Authority responds to legal threat from Thurrock Council

Preston City Council has said it will “vigorously” defend itself after it was threatened with being sued – potentially for more than £2m – by another local authority 240 miles away.

Town hall chiefs were responding to the prospect of a legal challenge by Thurrock Council in relation to solar farm investments made by the Essex borough which cost it an estimated £200m.

Preston has been identified as one of 23 ‘sample’ councils from which Thurrock intends to try to recoup £50m of those losses – based on the fact they are all members of Association for Public Service Excellence (APSE), the organisation that valued the energy-producing assets.

If the case was ultimately brought and succeeded, it could leave Preston with a £2.2m bill – should the full amount be awarded to Thurrock and split equally between the councils sued.  That would equate to around a tenth of Preston’s annual revenue budget, which pays for day-to-day services in the city.

However, The Bureau of Investigative Journalism (TBIJ) – which broke the story about Thurrocks’s plans and first uncovered the solar farm saga four years ago – says the now effectively bankrupt authority intends to argue that all of APSE’s more than 250 members should be liable if it wins its claim.  An equal share of the payout in that scenario would cost Preston just under £200,000.

A spokesperson for Preston City Council told the Local Democracy Reporting Service the authority was “extremely disappointed by the current legal threat by Thurrock Borough Council to recover sums it alleges it has lost as part of its investment in solar farms”.

“This is a case that has been ongoing for some time and Preston City Council vigorously defends its position as a member of the Association for Public Service Excellence (APSE) which is a not-for-profit, unincorporated association.

“Preston City Council is taking legal advice in respect of its position and is playing an active role in ongoing discussions with fellow members,” the spokesperson added.

The 53 solar farms in which Thurrock invested ended up being worth far less than the authority believed. APSE says it based its valuation on information provided by the then owner of the sites, Rockfire Capital – and that there were no mistakes in the association’s own calculations.

In a statement issued last week, APSE accused Thurrock Council of being “highly disingenuous” in suggesting the organisation had “not gone to great lengths to engage in dispute resolution”.

“As these matters are the subject of legal dispute, making such public statements, as made by Thurrock, risks undermining fairness and transparency, and opens up the potential for further legal action, which APSE may now need to consider,” it said.

However, Thurrock Council leader John Kent, also speaking last week, said it was “extremely concerning that APSE, in undertaking advisory work on commercial matters, has not had in place appropriate safeguards to limit the financial exposure and liability to its member local authorities.”.

“We are fully aware of the huge financial pressures facing local government, and we have no desire to increase that burden, but we do need APSE to take responsibility for the advice they provided and to help right those wrongs for the people of Thurrock,” Cllr Kent concluded.