Leeds City Council this week emerged victorious in a court battle with Jan Fletcher’s Harrogate-based property developer Montpellier Estates over construction plans for Leeds Arena.
Montpellier failed in its £43.5m damages bid over a contract to develop the city’s new venue.
Mr Justice Supperstone ruled in favour of Leeds City Council following a lengthy High Court process.
Montpellier had claimed damages from the Council, accusing it of deceit and breach of contract under European procurement law. The company claimed to have been millions of pounds out of pocket because of a flawed process.
Leader of Leeds City Council, Councillor Keith Wakefield said the Council would now be looking to recover the £4m of legal costs it had incurred defending the case.
Mr Justice Supperstone also rejected allegations of fraud and dishonesty against eight named individuals connected to LCC, including former council leader Andrew Carter and professional consultants.
The dispute centred on the 2007 tendering process for the Leeds Arena when Montpellier Estates put forward its 10-acre ‘City One’ site, in Holbeck, as a potential location.
Montpellier had already put in its bid when, in November 2008, Leeds City Council terminated the process. The council went on to build the arena on a site off Claypit Lane which it owned along with Leeds Metropolitan University. Montpellier had claimed the procurement exercise had been a sham.
The judge ruled, however, that the Council was entitled to bring the competitive tendering exercise to a close when other bids were found not to be good value for money and then to develop the arena itself. He added that the authority acted both in good faith and lawfully.
All of the individuals facing allegations of deceit were found not to have acted dishonestly.
Leeds City Council chief executive Tom Riordan welcomed the ruling and said: “This is absolute vindication of the honesty and integrity of Leeds City Council, its members, officers and professional consultants.
“Cancelling the competition to develop the arena and progress with the scheme at Clay Pit Lane was always a difficult decision to take, but was a correct one given the state of the economic crisis in November 2008. There was certainly never any deceit involved.”
Fletcher expressed surprise at the judgment and said she was considering grounds for an appeal, adding: “I continue to remain committed to and passionate about the city of Leeds and wish every success for the opening of the Leeds Arena later this year.”
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