Judge orders ex-chairman of developer to pay council £2m in legal costs

Leeds City Council has been given permission to pursue legal costs from the former chairman of a property developer that lost a bitter dispute over the development rights for a £60m arena.

In the High Court Mr Justice Supperstone also ordered Jan Fletcher, former chairman of Montpellier Estates Ltd, to pay £2m in interim costs before 14 November, pending a final decision on the total amount due.

This followed the judge agreeing to Leeds’ application to join Fletcher to its claim for costs against Montpellier.

The council based its application on a written personal undertaking given by Fletcher in July 2012 – ahead of the High Court hearing into the claim – to cover the costs should the company be unable to do so.

In its £43.5m claim, the company had alleged procurement breaches and, initially, deceit when the local authority ended a competition to build the Leeds Arena and chose to develop a separate site it owned.

Montpellier, which took part in the original competition and owned one of the two sites in the running, claimed to have received assurances from the council that it did not intend to build the arena itself.

In February 2013 Mr Justice Supperstone dismissed the claim, saying that the deceit claim in particular should not have been brought.

In April the judge awarded the council £2m in interim costs against Montpellier, but the company subsequently failed to pay up.

Leeds served a winding up petition on the company in July.

A spokeswoman for the local authority: “We’re pleased that Mr Justice Supperstone has granted this order. As we have stressed previously we gave MEL and Ms Fletcher every opportunity to meet the interim costs, including agreeing to extend the legal deadline for payment.

“This has left us with no choice but to take this action and we would be failing in our duty to the council tax payers of Leeds if we did not actively pursue these very large costs.”