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Last Updated: Saturday, 24 April, 2004, 15:09 GMT 16:09 UK
Dame Shirley agrees 12.3m deal
Dame Shirley Porter, ex-leader of Westminster council
Dame Shirley Porter led the council in the 1980s
Dame Shirley Porter has agreed a provisional 12.3m settlement with Westminster City Council over the so-called 'homes-for-votes' scandal.

The former Westminster City Council leader was disgraced over a plot to sell off cut-price council houses to potential Tory supporters.

The council and the Audit Commission announced the deal with Dame Shirley and her family on Saturday.

It is subject to approval in the British Virgin Island courts.

'I did nothing wrong'

The settlement follows negotiations and mediation in the past few days with Dame Shirley, the Tesco supermarket heiress, and her family.

Dame Shirley maintained her innocence, saying: "I have decided that it is time to bring this case to an end, despite my belief that I did nothing wrong."

Of the amount, 12m would be paid in cash and the rest in costs to third parties, the council said.

Dame Shirley originally faced a judgment debt of some 27m plus interest and costs, following a prolonged legal battle.

"This case has many lessons for others who give their time freely to serve their communities," Dame Shirley said.

It has blighted lives on both sides and this settlement gives all parties the chance to move on and look ahead
Kit Malthouse
Westminster Council

"As leader of the council I was repeatedly assured that the policies we followed were lawful. Others, it seemed, disagreed."

Deputy leader of the council Kit Malthouse said: "While we would have preferred that the debt be paid in full, we have had to be pragmatic and weigh in the balance the costs and risks of litigation overseas.

"Once this is taken into account, I believe this is a good settlement for the council.

"Over the last 15 years or so, many millions of pounds has been expended by the council on this issue.

"It has blighted lives on both sides and this settlement gives all parties the chance to move on and look ahead."

Frozen assets

On recovering an amount lower than the original charge, Mr Malthouse told BBC News 24: "We're broadly satisfied that Dame Shirley was never worth personally anything like the amount of the surcharge.

"There was no way we could have recovered more than she was actually worth."

Dame Shirley also spoke of the stress the case had caused.

"This case has already lasted 18 years and inflicted tremendous legal and emotional cost - in particular on my family, who have been unfairly drawn in."

Westminster council said it "had been successful in finding and freezing certain overseas trust assets connected to Dame Shirley and her family, and the prospective legal action in claiming those assets prompted the move to mediation".

'Complex case'

The audit commission was represented at mediation as it wanted to recover the costs of the original auditor's proceedings.

"We have been impressed by the council's persistence and determination throughout," said chief executive Steve Bundred.

Solicitors acting for Westminster described the settlement as "excellent".

"This has been a long and difficult case, involving complex forensic investigation and litigation across a number of jurisdictions," John Fordham from Stephenson Harwood said.

The BBC's Shaun Ley
"There will never be another case like this one"

Q&A: Dame Shirley's downfall
24 Apr 04  |  BBC Parliament
'Homes for votes' inquiry halted
03 Feb 04  |  London
Dame Shirley's 'assets frozen'
05 Nov 03  |  Politics
Dame Shirley misses 27m deadline
13 Sep 02  |  England

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