Judgment: 2011-07-28 · Court archive

High Court dismisses QDM Capital challenge to Galway pool heating tender

The court held the Leisureland boiler replacement was properly classified as a public works contract and that the tender notice adequately indicated its scope.

High Court · [2011] IEHC 534

Who, what, where, when and why

Who
  • QDM Capital Limited (Plaintiff)
  • Galway City Council (Defendant)
  • Kevin Feeney (Judge)
What

The court held the Leisureland boiler replacement was properly classified as a public works contract and that the tender notice adequately indicated its scope.

Where

Places mentioned in the report

  • Leisureland swimming pool complex
  • Salthill
  • Galway
When

Judgment:

Why

Reasons reported in the judgment

The project involved supplying a combined heat and power unit and two boilers, removing the existing system, and installing and integrating the replacement while the leisure complex remained operational. The existing heating system had stopped working and a temporary system was in use. The court noted the goods accounted for significantly less than 45 per cent of the estimated total price, and that the work involved technical removal, including asbestos, several disciplines and an estimated 18-week duration. It concluded the contract’s predominant purpose was construction and installation work, making it a public works contract rather than a supply contract.

The High Court dismissed QDM Capital Limited’s applications for judicial review of Galway City Council’s tender process for replacing the heating system at the Leisureland swimming pool complex in Salthill, Galway.

In a judgment delivered on 28 July 2011, Mr Justice Kevin Feeney considered two proceedings, numbered 2011/305 JR and 2011/365 JR. The court said the earlier application had been based on misconceptions and incomplete information. The later proceeding was brought under Order 84A, for which leave was not required.

The dispute concerned a contract notice published on 6 April 2011. QDM argued the contract was a public supply contract, while the council treated it as a public works contract. Both sides accepted it involved a mix of goods and works, so the court applied a “main purpose” test to decide which element characterised the contract.

The project involved supplying a combined heat and power unit and two boilers, removing the existing system, and installing and integrating the replacement while the leisure complex remained operational. The existing heating system had stopped working and a temporary system was in use. The court noted the goods accounted for significantly less than 45 per cent of the estimated total price, and that the work involved technical removal, including asbestos, several disciplines and an estimated 18-week duration. It concluded the contract’s predominant purpose was construction and installation work, making it a public works contract rather than a supply contract.

QDM also argued the notice did not disclose enough about the contract’s nature and scope to allow it to be understood and challenged. The court compared the case with the European Court of Justice’s Lämmerzahl judgment, which concerned a notice lacking information about the quantity or scope of a software contract. Here, the notice described the replacement low-pressure hot water system, the CHP unit and associated equipment, and required the heating system to remain operational during the work. Although the notice incorrectly estimated construction at eight weeks, the court found it still gave an adequate indication of scope. It also noted that further information would be available after expressions of interest and before tenders were submitted.

The court rejected the challenge on both issues and dismissed QDM’s applications in both proceedings. It did not decide several other complaints, including those concerning a €1.25 million minimum turnover requirement, time limits, procurement guidelines and use of a restricted procedure, because QDM did not pursue them at the hearing.

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