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Page last updated at 15:54 GMT, Monday, 14 June 2010 16:54 UK
Developer sues Leeds City Council over Arena tendering
Leeds Arena Claypit Lane site
The outlined area shows the Claypit Lane site chosen by the council

Leeds Arena is the focus of new controversy, as Leeds City Council is sued by a local developer.

Montpellier Estates Ltd (MEL), a Harrogate-based property development company is arguing that the procurement rules have been broken.

They are claiming to be millions of pounds out of pocket in what they see as a flawed process.

The court case follows criticism from civic leaders in Sheffield, worried about adverse affects on their Arena.

A Leeds City Council spokeswoman commenting on the court action said:

"Montpellier Estates Ltd have indicated that they may seek an injunction to prevent Leeds City Council from entering into any contract for the development of the Leeds Arena.

"In view of this the council took pre-emptive action at the High Court last week to strike out this and other aspects of their claim, to ensure that the much-needed Leeds Arena can progress as planned."

The dispute arose in November 2008 when the council announced it had chosen a site on Claypit Lane, then owned by Leeds Metropolitan University, as the preferred site for the £75m Arena development.

Leeds Arena decision is made

In September 2004, the Council had commissioned PMP Consultants to produce a feasability study into "the Future Provision of Concert, Arena and Other Music Related Facilities in Leeds".

Proposed interior of Leeds Arena
The proposed interior of Leeds Arena, which will have a capacity of 13,500

The council opted to buy the land from LMU and undergo the development themselves, thus cancelling the tendering competition that had included MEL's site at Sweet Street in Holbeck and another site on Elland Road. The council believed that this was the only financially viable option.

Montpellier Estates has issued the following statement:

Montpellier explained that the costs incurred in tendering for a multi-million pound development are considerable. All tenderers each need to employ their own professional teams of architects, planning consultants, regeneration consultants, arena and sports advisers, quantity surveyors, highways consultants, lawyers and accountants.

MEL believe that they have been misled by the council over the whole affair. Managing Director Jan Fletcher commented:
"The business community needs absolute confidence in any public procurement process, so that businesses can weigh up the genuine risks involved."

"It is not in the best interests of the region if the private sector refuses to take part in important procurement competitions (such as that for the Leeds Arena) because they are worried they may not be conducted fairly and transparently."

UPDATE (24-6-2010):

Mr Justice Eady, presiding over the case, has thrown out the council's application to strike out parts of Montpellier's claim. He believes that in the light of developing law in this area, the conclusion should be that Montpellier should have the opportunity to argue its case at trial.

A council spokesman commented on the decision: "We are disappointed that the High Court has ruled against the council's application to strike out certain aspects of Montpellier's claim."

"We will vigorously contest this case. In the meantime we want to reassure Leeds people that it is still very much business as usual and work to build the arena will continue as normal."

Jan Fletcher of MEL stated: "The business community needs absolute confidence in any public procurement process, so that businesses can weigh up the genuine risks involved."

"It is not in the best interests of the region if the private sector refuses to take part in important procurement competitions (such as that for the Leeds Arena) because they are worried they may not be conducted fairly and transparently."




SEE ALSO
Leeds Arena: a sneak preview
17 Mar 10 |  People & Places
MP welcomes arena funding refusal
10 Oct 09 |  South Yorkshire

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