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£2 million settlement saves property developer Jan Fletcher from bankruptcy order

A judge has formally dismissed a bankruptcy order against property developer Jan Fletcher on request from Leeds City Council after a £2 million out of court settlement of the council’s costs was reached.

An agreement that Ms Fletcher pay the council £2 million has been signed outside the court and the council therefore formally requested that a district judge dismiss the bankruptcy petition it had filed in order to retrieve its costs.

Deputy district Judge Buchan agreed the council’s request and dismissed the petition at Harrogate County Court today.

The £2 million costs had been awarded by High Court judge Mr Justice Supperstone nearly a year ago. This followed the failed attempt by Montpellier Estates Limited (MEL) to sue the council over the awarding of the contract to build Leeds Arena.

When MEL failed to pay the judge then granted permission to the council to pursue the company’s former chair Ms Fletcher personally for the costs.

She gave a written undertaking to the council in July 2012, before the original case began, guaranteeing payment in the event of MEL both losing the case and not being able to pay up.

Leeds City Council chief executive Tom Riordan said: “I’m very pleased that we have been able to recover a significant sum of the money we should never have had to spend in this case. I’m satisfied, based on legal advice, that this is a good deal for council taxpayers.

“This has been a long drawn-out and costly legal process and we are finally drawing a line under it by recovering as much as possible of public money at a time when our budget pressures are particularly severe.”

After the original High Court hearing Mr Justice Supperstone had ruled that the council had been perfectly entitled to cancel the competition to develop the arena and build it itself when other bids were found to be not good value for money. He also said that the deceit element of MEL’s claim should never have been brought.

This was posted in Bdaily's Members' News section by Clare Burnett .