A humble "deemed satisfactory" next to each line: final bill 75,879.99 euros in damages
The Council of State awards POLYMAT SAV 75,879.99 euros in damages – 10% of its bid – because the Résidence Préfleuri approved GBM's price justifications with nothing more than "the response was deemed satisfactory" next to each line item.
What happened?
On 12 September 2019 the public-law association Résidence Préfleuri awarded a works contract for the supply and installation of kitchen equipment for its new retirement home to SA GBM for €655,708.41 ex VAT. POLYMAT SAV was ranked second at €758,799.98 ex VAT. During bid analysis, the project author had flagged seven prices as abnormal – six apparently abnormally low, one apparently abnormally high – and requested justifications under article 36 of the 18 April 2017 Royal Decree. GBM replied on 13 August 2019: the six low prices were attributed to "exceptionally favourable purchasing conditions" via GBM's membership of the Eurochef network. The high price (a technical wall, line 14.1) was backed by a supplier quote. For the other six line items: no purchase invoices, no catalogues, no Eurochef offers, no breakdown of labour, installation, overhead or margin – even though the project author had specifically asked. There were also unexplained mark-up coefficients: 5% on line 8.4, 9% on line 14.1, versus 16.7% on other lines. Despite this, the analysis report noted for each line: "the response was deemed satisfactory". The contracting authority adopted this wording in its award decision. POLYMAT filed for annulment. By judgment 257.369 of 19 September 2023 the Council of State annulled the award: the motivation was a mere style clause, containing no concrete examination of the price justifications, and the authority could not reasonably have concluded the prices were normal. By then, however, the contract had been performed by GBM. POLYMAT then claimed damages under article 11bis of the coordinated laws on the Council of State: €172,311.02 as a primary claim (lost gross margin) and €75,879.99 as a subsidiary claim (10% flat rate). The Résidence Préfleuri defended on three fronts. First: POLYMAT was supposedly not even qualifiable, lacking a €500,000 reference. The Council: "the award report concludes to the selection of the applicant" – once you have selected a bidder at award stage, you cannot undo that retroactively. Moreover POLYMAT had produced a certificate from SA Franki for works in Stembert for €530,974.22. Second: POLYMAT had supposedly only lost a "chance". The Council: nothing in the file suggests GBM could have provided adequate justifications on a new request – the claim that Eurochef membership "can easily be proven" is no proof of favourable purchasing prices. So this is a real loss, not a chance loss. Third: POLYMAT's detailed calculation at 16.59% of 2019 turnover with overhead absorption. The Council considers the calculation insufficiently substantiated and falls back on the 10% flat rate (by analogy with article 16 para. 3 of the Remedies Act). Final amount: €75,879.99 plus compensatory interest from 12 September 2019 until the judgment and default interest thereafter, plus €200 court fee, €20 contribution and €770 procedural indemnity. All at the charge of the Résidence Préfleuri.
Why does this matter?
This ruling is a useful benchmark for bid managers and contracting authorities alike. For authorities: a price check that amounts to "deemed satisfactory" without substantive analysis is a lottery. If you are annulled later and the contract has already been performed, it easily costs 10% of the second-ranked bid – here €75,880 on a €655,708 contract, plus five years of interest. For bid managers: when you are ranked second and you suspect abnormally low prices by the winner, look at the quality of the price justifications, not just the award decision. If the authority only writes "satisfactory" without substance, that is an annulment ground – and, once the contract has been performed, a damages ground. The ruling also relaxes the "chance loss versus real loss" threshold: if nothing in the file suggests a realistic alternative scenario, the ranking is the real loss.
The lesson
If you are ranked second and you suspect the winner's price justifications were not seriously examined: request the bid analysis report and the price correspondence under the formal motivation obligation. Phrases like "deemed satisfactory" or "acceptable" without substance are a style clause – and therefore an annulment ground. Once the contract is performed you obtain at least 10% of your bid amount as damages.
Ask yourself
Have you seen an award file where the price check consists of a single sentence per line ("satisfactory", "acceptable", "compliant") without the purchase prices, labour hours, overhead and margin being broken down per line? That is a style clause – and the motivation fails.
About this database
The Council of State (Raad van State / Conseil d'État) is Belgium's supreme administrative court. In disputes over public procurement — from contract awards to tenderer exclusions — the Council of State is the final arbiter. The rulings in this database are summarised by TenderWolf in plain language, with practical lessons for tenderers and contracting authorities. View all rulings →