The law firm TARK successfully represented the Municipality of Haljala in a legal dispute against the State Shared Services Centre (RTK). On 25 January 2022, RTK issued a financial correction decision, declaring 25% (€170,700) of the grant funding allocated to the Municipality for the development of the Võsu beach recreational infrastructure project as ineligible.
According to the decision, Haljala Municipality had allegedly breached public procurement regulations during the execution of the project, and RTK asserted that these breaches had resulted in financial loss. The central legal issue concerned whether the Municipality had modified the terms of the procurement contract during project implementation within the limits permitted under the Public Procurement Act.
Both the administrative and circuit courts concluded that Haljala Municipality had not violated the Public Procurement Act when it amended certain terms of the procurement contract. The courts found that the changes made were in line with the legally permissible conditions for contract modifications and were, therefore, lawful.
In their judgments, both instances provided meaningful legal guidance on evaluating the permissibility of procurement contract amendments, offering interpretative clarity likely to reduce the risk of similar disputes in the future.
Haljala Mayor Anti Puusepp underscored the significance of the circuit court’s ruling: “This dispute resulted in the Municipality losing a substantial amount of grant funding three years ago, which we were required to cover using our own resources. The final court decision brings some relief to the Municipality’s strained budget,” he stated, adding that the decision to pursue judicial clarification was both necessary and justified.
The client was advised by partner Tanel Küün and senior associate Rahel Behrsin.
Photo: Haljala Municipality
