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Borough council calls in leading local government lawyer to review actions over £250m stadium loan

Woking Borough Council has appointed prominent local government lawyer Gifty Edila to conduct an independent review of its actions over a controversial stadium development in which it offered a developer a £250m loan.

This followed a scrutiny report in the summer and the release this month of a 40-page redacted document that described the roles of individuals.

Ms Edila was Corporate Director of Legal, Human Resources and Regulatory Services for the London Borough of Hackney from 2009-16 and before that Director of Law and Administration at the Royal Borough of Kensington and Chelsea.

She will make recommendations arising out of the saga of the council’s dealings with Woking Football Club following on from the initial scrutiny report.

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The council resolved after this to adopt a project management framework and create an officer conflict of interests protocol.

It also decided: “All councillors should be more careful in accepting information without reasonable evidence, and unsubstantiated statements should be more rigorously tested prior to agreement of council (officer) recommendations.”

Key findings from the scrutiny task group included that the council’s decision to support the Woking Football Club and its associated proposed development “was given on unclear evidence regarding the financial state of the football club”.

Due diligence “appears wholly inadequate being conducted on a far too restricted basis with no additional checks on the key people behind the development, their business history or any of the other aspects normally conducted by banks when considering a loan of this magnitude”.

The task group found there was “little if any documentation to explain why the council offered the developer a £250m loan”.

This revolving loan facility was “unprecedented” for an external developer and “appears high risk as no actual values have been attributed to the assets of [the developer] to cover the loan until such time as tangible assets have been built”.

Decisions appeared to have been made under delegated authority “which puts into question the authority of the key officer making them and his/her authority to so do”, the report group noted.

Mark Smulian

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