Can a court put conclusion of an agreement by a contracting authority on hold pending review of a complaint contesting a National Appeals Chamber ruling?
In Poland, filing a complaint with the KIO concerning the outcome of a tender or the wording of tender documentation (the first instance) is the principal legal remedy. Under the Public Procurement Law of 11 September 2019, a KIO ruling can be contested before the Warsaw Public Procurement Court (second instance). A complaint is not a very appealing legal remedy, however, because under the law, once the KIO has delivered a ruling, the contracting authority is not required to wait for the ruling on the complaint, and may proceed to conclude an agreement with a contractor even if a competitor intends to contest the KIO ruling in the second instance. In this scenario, even if the contractor successfully contests the KIO ruling in court, it still will not be awarded the contract. At best, the contractor can expect the court to find the contracting authority to be in breach of the act of law, and can seek compensation in a separate lawsuit that will be expensive, difficult to win, and lengthy.
The sole means whereby a contracting authority can be forced to desist from concluding an agreement once a KIO ruling has been given is obtaining injunctive relief from a court, temporarily stopping conclusion of the agreement, pending a ruling on an appeal.
In recent years, the Warsaw Regional Court has found motions filed by contractors seeking injunctive relief to secure claims by stopping conclusion of an agreement to be inadmissible. In my view this has caused a significant decrease in the number of complaints filed.
The court now evidently takes a different view, as in a ruling of 23 February 2021 (case XXIII Zo 3/21) the XXIII Commercial Appeal and Public Procurement Division of the Warsaw Regional Court dismissed, on substantive grounds, a motion for injunctive relief sought by a contractor contesting a ruling made by the KIO. Dismissal on substantive grounds (oddalenie) and not formal grounds (odrzucenie) means that the Warsaw court examined the merits of the case, thereby acknowledging a contractor’s right to seek injunctive relief.
At this point it is difficult to say whether this ruling is an exception, or represents a permanent shift in the line to be adopted in the court’s adjudications. If this new line in adjudication becomes firmly established, it will be more feasible for a contractor in Poland to win a tender following a ruling by a court of second instance.
It is unlikely to be easy to obtain injunctive relief of that kind (the court has to find the statement of reasons convincing), but the most important thing would be that the court, which as of 1 January 2021 is the only public procurement court in Poland, turned away from what I see as a flawed interpretation of the law, and has stopped finding injunctive relief stopping conclusion of an agreement to be impossible. It remains to be seen, based on future rulings by the court in this regard, whether ruling XXIII Zo 3/21 represents a permanent shift in the court’s approach to interpretation of law, or whether this was just an ‘isolated incident’.