Council's Faraday Road court costs top £363,000

Local authority has spent six figure defending itself against legal challenges

LEGAL disputes over plans to regenerate Newbury’s London Road Industrial Estate (LRIE) have cost West Berkshire taxpayers £363,545.66.

The Newbury Weekly News can reveal that the district council spent the six-figure sum defending itself against legal challenges in the High Court and the Court of Appeal.

However, the overall cost of the major project, which has been in the pipeline for 14 years, is expected to run into the millions.

Last month, the council was found to have breached EU procurement law by entering into an agreement with St Modwen, the multi-billion-pound developer it appointed to carry out the scheme.

The Court of Appeal ruled that the development agreement, signed in 2015, constituted a public works contract and found the council had not followed the correct tendering process.

As a result, the agreement has been declared ineffective and the council must go back to square one and start the whole process again.

It has been confirmed that in November 2014, the council’s executive committee gave chief executive Nick Carter the authority to enter into the agreement.

However, the council says it is not planning to carry out any kind of internal review and reiterated that it is still considering going to the Supreme Court – the highest court in the land – to try to get the ruling overturned.

This is despite the Court of Appeal refusing the council permission to appeal the decision.

News of the council’s six-figure legal spend comes just weeks after the cash-strapped local authority announced plans to cut funding to vital services for the elderly and vulnerable in a bid to save £295,000.

The council’s opposition leader Lee Dillon (Lib Dem, Thatcham North) said: “The council need to explain how it committed over £350,000 on legal fees on a case which it has lost.

“When you add this to the other costs associated with LRIE, it appears that taxpayers have been funding poor decisions after poor decisions.

“It should be noted that the council are currently consulting on budget cuts to vulnerable services which this £363,000 could easily cover.

“Instead, the council have thrown good money after bad trying to win a court case because of a decision to shortcut the procurement process.”

West Berkshire Council’s executive member for corporate services Dominic Boeck said: “This is a misleading statement that refers to a drawn-out legal process where many points were found to be invalid.

“The council has invested significant resources into the redevelopment of Faraday Road, and it remains committed to the principle of redevelopment of that area of the district.

“The council was challenged by a local developer and was obliged to respond to that in order to protect the investment that it had made for the benefit of all the residents of West Berkshire.

“The High Court found robustly in favour of the council when it considered the challenge, and although the Court of Appeal (CA) found against the council, this was on a limited technical point of law.

“It is perhaps of note that this issue has not previously been considered by the courts, including the CJEU (Court of Justice of the European Union) or the Attorney General.

“The council is understandably disappointed with the decision of the CA and is considering its options in that regard.

“In terms of the current budget proposals that the council is consulting on, these potential changes to service delivery in a number of areas are being considered to ensure that the council can set a balanced budget for 2019/20.”

The case was brought by Faraday Development Limited (FDL), which was awarded planning permission for its £50m Faraday Plaza scheme comprising retail and housing space, a hotel and restaurant and an additional exit and entrance road on to the A339, in 2009.

It had to resubmit its application in 2012 after the three-year time period for works to commence lapsed.

But despite it being an identical application to the previous one, the council refused it.

The council later announced that St Modwen was its preferred developer and entered into a development agreement.

FDL had previously appealed the council’s decision to refuse its planning application for the Faraday Plaza scheme and a planning inspector upheld the appeal in favour of FDL.

In a damning report, the inspector accused the council’s planning officers of misleading councillors in their decision to reject the application.

The council’s Lib Dem opposition asked for the matter to be discussed at the council’s overview and scrutiny commission.

But councillors voted to refer the item to the planning advisory group, whose meetings are not held in public.