One of Scotland’s biggest local authorities is facing a £45million lawsuit over a maintenance contract with a pothole repair company.
Infrastructure firm Amey is suing North Lanarkshire Council over its decision to hand a 12-year road repair deal to a German company.
Amey, which has managed road repairs and maintenance for the authority for 13 years, argued the winning bidder Hochtief PPP Solutions had made an “abnormally low” submission and its offer should have been excluded.
The contract is worth up to £450million and includes the management of roads, footpaths, street lighting cable, three reservoirs, more than 3000 signs and 200 traffic management systems for up to 12 years.
In the Court of Session, Amey accused the council of “failing to act transparently” by not listening to its concerns about how the contract was awarded and failing to give answers to questions.
Amey argued the council had not “provided certain information…including the reasons why it was unsuccessful in the tender and the relative advantages of [Hochtief’s] tender” within the legal time limit to do so, court papers stated.
The firm also said the council “ought to have excluded Hochtief’s tender as non-compliant… in relation to its demonstrated capability to perform the contract works” and accused the council of wrongly scoring its tender.
The decision to award it to Hochtief was initially suspended but the judge, Lord Craig Sandison lifted the suspension in June last year and the council announced the German firm was the winner in August.
The Court of Session will now hear arguments from Amey and the council about how the contract was handed out and decide if the construction firm should be awarded the £45million in compensation it is seeking.
Several councillors are understood to have been called to give evidence. The contract is part of the council’s Enterprise Project which seeks to offer long-term deals to firms for management of housing repairs and road maintenance.
Council chiefs previously came under fire for awarding Scotland’s biggest ever public service contract, for £1.8billion, to a firm found to be manipulating its performance figures.
As we revealed last year a whistleblower alleged Mears had been falsifying its figures to make it look like staff were carrying out property repairs faster than they were. A probe found the completion dates had been changed on more than 13,000 repair jobs over two years.
A month after the investigation concluded, councillors voted to award the company the deal for housing repairs and maintenance lasting up to 12 years.
A North Lanarkshire Council spokeswoman said of the Amey case: “All procurement exercises carried out by the council are conducted strictly in accordance with statutory requirements.”
Amey said that it would not comment on the legal proceedings.
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