The Court of Appeal has overturned a decision by the Public Contracts Review Board (PCRB) to scrap the original Evans Building concession.
In a ruling today, Chief Justice Mark Chetcuti, Judge Christian Falzon Scerri and Judge Josette Demicoli, ruled that Valletta Luxury Projects’s winning tender was scrapped due to an obvious and easily fixable error.
Eden Leisure CEO Simon De Cesare
Valletta Luxury Projects (VLP), a consortium composed of Eden Leisure and Iniala owner Mark Weingard, had won an initial competitive bid with a proposal to bring the luxury hotel brand Anantara to Malta’s shores.
It pledged to pay a total of €78 million over the 65-year concession period, more than any other tenderer. However, its tender response format wrongly listed its total bid as the annual fee of €1.2 million, prompting two rival bidders – European School of English Ltd and Katari (now PLAN Group) – to appeal to the PCRB.
While the PCRB sided with the rival bidders, the Court of Appeal ruled that the concession should be returned to VLP.
The Court pointed out that VLP had clearly listed €78 million as its total concession fee and €1.2 million as its annual fee.
When it spotted the mistake, the evaluation committee asked VLP to clarify whether it actually meant to list €78 million and the consortium responded in the affirmative.
This is in line with the general rules governing tenders, which allows evaluation committees to give tenderers up to five working days to fix price error corrections.
“VLP’s mistake cannot be considered a substantial one, because it ultimately still offered €78 million as a grand total in concession fees,” the court stated. “The correction of this mistake couldn’t lead to a new offer being submitted but only served as a tool to crystallise the original €78 million pledge.”
It said that just as bids shouldn’t be discarded when a tenderer forgets to declare a price in a relevant section if that same price can be inferred from other parts of the document, the same principle should apply if the tenderer accidentally inserts one price instead of another.
“This is precisely what happened in the present case, and in light of the principles mentioned above, the Court firmly holds that nothing could have prevented the evaluation committee from proceeding as it did, by applying the principle of proportionality.”
