Bechtel loses HS2 legal battle

Artist’s impression of Old Oak Common station (Image: HS2 Ltd)

Bechtel has lost its legal action against the company in charge of procuring the HS2 high-speed rail line, after losing out on a bid to build Old Oak Common station.

The BBVS (Balfour Beatty, Vinci, and Systra) joint venture ended up winning the £1bn deal, after tendering the lowest lump sum fee for the project of the four bidders. BBVS scored 75.38% in the competition, compared to Bechtel’s score of 73.76%. Bechtel scored higher than BBVS in some areas such as: technical, behavioural assessment, commercial and staff rates, but was “substantially outscored” by BBVS on the lump sum fee.

But Bechtel alleges that HS2 was in breach of its obligations under the Utilities Contract Regulations 2016 (UCR 2016) in the way it conducted its evaluation of the bids. It claimed that its own tender and that of BBVS were not evaluated correctly and maintained that BBVS’ bid should have been given a lower score on some questions, while Bechtel should have been given a higher score.

Bechtel argued that BBVS ought to have been disqualified from the competition or that the competition ought to have been abandoned.

In its defence, HS2 denied that it was in breach of its obligations and maintained that the score awarded to Bechtel was correct and that BBVS was the winner. It also denied that the BBVS tender was abnormally low. HS2 also argued that Bechtel’s challenges were time-barred and that it had included a “fundamental” qualification to its tender that was not acceptable to HS2.

Bechtel was told by a letter dated February 2019 that it had been unsuccessful in the competition and issued proceedings later that month to prevent HS2 from entering into a contract with BBVS. In August 2019, Bechtel compromised with HS2 and lifted the automatic suspension under UCR 2016, allowing HS2 to enter into a contract with BBVS.

High Court judge Mr Justice Fraser praised the two sides for conducting the litigation and trial in a “highly constructive and professional manner”, with no “interlocutory warfare between the parties”.

In his conclusion, Mr Justice Fraser said: “In reality, this case could have been decided merely on the disqualification point alone…In any event, I have considered all the other issues so that the parties can see that, regardless of my finding on the disqualification issue, this makes no difference to the outcome. BBVS would still have been the winning bidder, and Bechtel’s claims in these proceedings all fail.”

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