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'Buy British' cladding policy illegal

NEWS

A HIGH Court judge this week described a claim that John Laing Management told a joint American/French contractor it would 'never work in the UK again' after a dispute over a £33M cladding contract as 'entirely plausible'.

Judge Humphrey Lloyd made the statement during his judgement on the first stage of a long- running court case between cladding contractor Harmon-CFEM and the House of Commons Commission.

Judgement on the year-long case, concerning a dispute over the award of the cladding contract for new MPs' office building Portcullis House, was delivered last Thursday.

Harmon-CFEM had alleged that it had not been awarded the £33M contract to supply and fit special bronze cladding to the building because the House of Commons was operating a 'Buy British' policy. The contract was awarded instead to British-Austrian joint venture Seele-Alvis, despite the fact that Harmon-CFEM had submitted a tender price £2M cheaper.

The Technology & Construction Court - formerly the Official Referees court - found that the award of the contract to Seele-Alvis was made against European competition law.

The judge said tenderers had not been treated fairly by the Corporate Officer of the House of Commons Commission.

He also said the reasons given by the Commission for the decision to award the contract elsewhere were misleading and declared it 'responsible for misfeasance in public office'.

The judge said Harmon could win back its tendering costs and the equivalent to any profit it could prove it would have made on the work. Tender costs would be up to £438,000 and profit between £4.5M and £5.4M.

The firm may also be able to claim legal costs for the case which was initiated in August 1996. According to Harmon's solicitor, Birmingham firm Wragge & Co, more than £1.5M had been spent by each side. Decisions on costs and awards await a second stage of the hearings.

One factor affecting the size of any award will be that Harmon went into liquidation during the period of the Portcullis cladding work, the judge declared.

Harmon did not maintain in court that the contract would have saved it from liquidation. But it submitted a note from its marketing manager Ed Boyle concerning alleged efforts made by Laing Management to dissuade it from any legal action.

The note concerned an alleged conversation between Boyle and Ron Kerr of Laing, in which the comment about never working in the UK again was made.

The note also suggests that other contracts on which Harman was working in the UK, including contracts for SmithKline Beecham, Daiwa Bank and Scottish Widows, would be 'adversely affected' by any legal action.

'Ron related the British Government to the Mafia and said they have their own rules' the note says. 'It was obvious that Harmon did not understand the way the good old boys in the UK worked.'

It went on to claim that Kerr had had a conversation with British Government legal representatives. They allegedly 'suggested [that] the British Government tells people to F*** OFF and they obediently cease in their action.'

An appeal on the case is being investigated, which prevents much further comment.

But the Commons Commission said the conversation between Harmon and Laing 'in no way represented its views or actions'. Referring to the alleged comments in the note, a spokesman said the Commons 'disassociates itself totally'.

A Laing spokesman said: 'As we are not party to litigation Laing Management appears to have complied with its obligations under the Construction Management Agreement to give advice on EC matters.'

No comment was offered on the note from Boyle.

The Portcullis building, next to Big Ben over the new Westminster Tube station, is probably Britain's most expensive office block providing luxury offices for around 200 MPs for £250M.

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