How innovative is the common law of tendering?

Traditional design-by-owner remains an important procurement option despite the advances made by design-build in recent years. Contractor-led innovation is important and desirable in both procurement options, yet traditional design-by-owner procurement processes prevent, restrict or even discourage such innovation. Developments in common law are revealed which result in contractual obligations for the procurer which might further inhibit innovation, as the procurer becomes obliged to treat all tenderers equally and fairly. The theory of the tendering contract is introduce and the problems for the procurer discussed when presented with a non-conforming alternative tender that offers a significant cost-saving against conforming tenders. However, if accepted, puts the procurer in breach of contract to at least one aggrieved tenderer. The conclusion is reached that in order to properly consider alternative tenders without failing in its obligation to treat all conforming tenderers equally and fairly, the owner must make specific provisions within tender conditions which create the power to consider alternative proposals. The owner must also define the permitted scope of such alternatives, and set evaluation criteria and any relevant weighting of criteria which will be applied in a contract evaluation and award process. The owner needs to strike a balance between, on the one hand, restricting or inhibiting innovation, and on the other, permitting such a wide scope of innovative proposals that the solution adopted bears no relationship to the original project for which tenders were invited. It therefore becomes important for the procurer to design the tender process rules so as to encourage contractor-led innovation, yet at the same time place some limit on the scope for such innovation. The limits must be such that the project delivered is still the project for which tenders were invited. A contract awarded to one tenderer for a product quite different from that which was tendered for probably results in the procurer's breach of the tendering contract' and consequent liability to pay damages to the other injured tenderer(s).