Jan Fletcher agrees deal with council over Leeds Arena case costs

JAN Fletcher has agreed an out-of-court settlement with Leeds City Council over the costs involved in her failed legal action over Leeds Arena.

A deal has been reached in principle for Mrs Fletcher to pay £2m towards the council’s costs.

Discussions between lawyers representing both sides took place at a behind closed doors hearing at Harrogate County Court this morning and an agreement has been reached dependent on Mrs Fletcher releasing assets connected to a third party.

The council said the settlement was in the best interests of taxpayers and it hopes to finalise terms in the next few days.

A Leeds City Council spokeswoman said: “We can confirm that the council has agreed in principle with Jan Fletcher, dependent on her getting further guidance on the release of assets, to a £2m settlement of our costs. We are satisfied, based on legal advice, that this is a good deal for council taxpayers and we hope to be finalising the details of the terms of the arrangement over the next few days.”

In October, a judge gave Ms Fletcher four weeks to pay £2m in interim costs, but she missed the payment deadline.

Leeds City Council brought the bankruptcy action saying it had a duty to recover the money on behalf of council tax payers.

When a person is made bankrupt they are required to hand over their assets to a trustee such as the official receiver who then handles the sale of their assets, which could include their home, in order to pay their debts.

In October, a High Court judge gave the council permission to pursue the former Montpellier Estates Limited (MEL) chairman personally for its costs defending her failed court bid.

Mr Justice Supperstone issued an order that Ms Fletcher pay the costs before November 14, pending a final decision on the total amount due.

This was after he agreed an application from the council at the High Court in Leeds to join her personally into its claim for costs against MEL.

The council’s application was based on an earlier personal undertaking from Ms Fletcher to cover the costs should the company be unable to do so.

It emerged that she gave the written undertaking to the council in July 2012, guaranteeing payment in the event of MEL both losing the case and not being able to pay up.

Mr Justice Supperstone had originally handed down a ruling in February last year dismissing entirely claims in damages for alleged deceit and flawed procurement under European regulations brought by MEL against the council.

The dispute centred on the 2007 tendering process for the Leeds Arena when MEL put forward its 10-acre “City One” site, in Holbeck, as a potential location.
MEL had already prepared and 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.

The judge said that the council was perfectly entitled to bring the competitive tendering exercise to a close when other bids were found not to be good value for money and then develop the arena itself.

The original hearing took place in London’s High Court over nine weeks towards the end of 2012.