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Developer agrees £2m costs settlement after failed procurement claim

Leeds City Council has agreed in principle to accept a £2m settlement in legal costs from a businesswoman whose property development company lost a high-profile procurement challenge against the authority.

In February 2013 the council successfully defended a £43.5m claim brought by Montpellier Estates Ltd (MEL), which had alleged procurement breaches and, initially, deceit.

The dispute centred on the local authority’s decision to terminate the procurement process for a new arena in the city.

In October last year Mr Justice Supperstone ordered MEL’s chairman Jan Fletcher, who had agreed to guarantee paying Leeds in the event the company could not foot the bill, to pay £2m in interim legal costs, pending a final decision on the total amount due.

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The council later brought bankruptcy proceedings against Fletcher but has now settled the case.

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."

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