Reasons for Issuing a Cash ‘Settlement’ to the Nicklaus Joint Venture Group

The request was refused by Wirral Metropolitan Borough Council.

Dear Wirral Metropolitan Borough Council,

On 11th Sept 2020 I submitted a request asking if the Development Agreement (DA) between Wirral Borough Council (WBC) and the Nicklaus Joint Venture Group (NJVG) for the Hoylake Golf Resort/Celtic Manor Resort left WBC to any obligations to be the developer’s financial provider, or would leave WBC in a potential ‘breach of contract’ situation. I did not ask these questions without research and they were deliberately worded to test my perception about what I understood about the DA, as a layman.

As far as I could understand, the DA was written to keep WBC in the driving seat at every ‘phase’ stage outlined in the DA.

The DA also clearly stated that WBC were under no obligation whatsoever to be the funding provider for the developer.

Furthermore, your reply to me confirmed as I suspected, that WBC were not aware of anything in the DA which would put them in a ‘breach of contract’ situation with the developer if the development was not completed.

According to the written DA, the commencement of each ‘phase’ of the project was dependent on the preceding ‘phase’ being completed to the council’s satisfaction. There was also mention of using independent arbitration should there be an unresolved disagreement between WBC and the developer about the completion of a ‘phase’.

In summary, the DA was written very much in favourable terms for the council and with little scope for the developer to cut corners or under-perform in their delivery. I really must commend the council’s legal contractors who constructed the DA knowing it to be a master-stroke in protecting the council and residents against under-performance by the developer. They really knew how to make the developer commit and clear the necessary hurdles before there was a chance of reaching the land-sale part of the agreement.

As we know, the NJVG have failed to complete even ‘phase 1’ of the DA, the all important funding strategy. We also know, WBC had no obligation to be the funding strategy provider for the developer and exercised their right not to do so, as stated in the DA.

Therefore, it comes as a surprise to see WBC issuing a seemingly ‘no fault settlement’ to the NJVG as a precautionary measure to avoid potential litigation costs against the council by the developer. It is well known that the NJVG are merely a cash-poor ‘steering group’ and unlikely to be able to finance litigation over a DA which they knew was not in their favour, yet willingly accepted as a risk. We know their likelihood of success in court would be extremely slim, yet WBC have decided to voluntarily compensate the developer for exercising their right not to provide a funding source to the developer.

We see the sum WBC have awarded to the NJVG falls a little short of half a million pounds of council-tax payers money. Therefore, on behalf of all of Wirral’s council-tax payers, please can you publish exactly what the payment represents in terms of which clauses from the DA it covers where the developer has real potential to claim for losses against the council for non-fulfilment of the project.

On face value, the developer has failed to provide a funding strategy for ‘phase 1’ yet we are supposed to believe this leaves WBC open to litigation. If the developer has failed, then why must the Council Tax payers fund their failure? What is missing from the DA which has put WBC in such an awkward position and failed to protect us?

Yours faithfully,

NJT Lauro

Dear Wirral Metropolitan Borough Council,

I am writing to enquire if there is any progress on the request I have made as the statutory 20 days have elapsed since I submitted my request.

I understand I may have to wait a little longer due to current conditions and it is not my intention to apply unnecessary pressure to the 'non-executive' people who do the real work at WBC.

However, those who make the decisions at WBC have a duty to provide their FoI officers with the information necessary to furnish requests within the time scales set out under The Freedom of Information Act. Therefore, it is not unreasonable for me to enquire if the decision-makers at WBC are experiencing problems in providing their FoI officers with the information I require.

Whilst I would rather not pursue for an answer to my query via the ICO, I wish to notify WBC that this 'prompt' for the body to respond with the information I have requested or provide a reason why it is being denied, will be my last before before escalating to the ICO.

Yours faithfully,

NJT Lauro

InfoMgr, FinDMT, Wirral Metropolitan Borough Council

1 Attachment

Dear  N J T Lauro

 

Thank you for your FOI request of 22 August 2021.

 

Your request is in effect seeking the disclosure of the legal advice given
to Councillors regarding the matter of the NJVG Development Agreement.   I
confirm that a confidential report of the Director of Law and Governance
was considered at a meeting of Wirral's full Council meeting of 11 August
2021.  This contained legal advice which is information in respect of
which a claim to legal professional privilege could be maintained in legal
proceedings.

 

Due to the nature and content of this report, it is the view of the
Council  that the document contains legal advice to members and as such is
considered to be legally privileged. Under s42 of the Freedom of
Information Act  2000 matters covered by Legal Professional Privilege are
exempt from disclosure and the Council relies  on the exemption provided
in s42(1) to refuse your request for disclosure of this report.

 

In making the decision to engage this exemption the principles set out in
the cases of Crawford v Information Commissioner and Lincolnshire County
Council (EA/2011/0145)  and

Bellamy v Information Commissioner and  the Secretary of State for Trade
and Industry (EA/2005/0023)  have  been  applied. The Information
Commissioner Decision  reference FS50803813
[1]https://ico.org.uk/media/action-weve-tak...
has been taken into account which  confirmed "that there is a significant
public interest in not undermining the  ability of a public authority to
freely seek and receive frank legal advice  in future. [The Information
Commissioner] considers that freely seeking and obtaining frank legal 
advice is crucial to a public authority’s ability to make informed and 
legally supported decisions."

 

The Council's position is that under the  Freedom of Information Act 2000 
there is no need to demonstrate prejudice or  adverse effect that could
arise from disclosure of the information.  Clearly the  public interest
test  is relevant. There is a strong presumption in favour of maintaining
the  concept of legal professional privilege and the rationale of ensuring
frankness in the exchange of views which serves the wider administration
of justice. Applying this to the current case,  the matter is recent and
there  is very likely to be harm in terms of administration of justice if
confidential legal advice is subject of  disclosure very shortly after the
settlement of a legal dispute.  There is a merit in maintaining that 
confidentiality so that in future counsel and solicitors are  not
constrained in terms of the way that they express their advice and
instructing solicitors are not inhibited in seeking advice, by risk of the
advice being published potentially  very shortly after settlement. 

 

Whilst clearly there is a level of public interest given the settlement
figure involved, this is not considered to outweigh the strong presumption
in favour of maintaining the presumption in favour of  the concept of
legal professional privilege. Your request for disclosure of the
information is therefore refused.

 

You have the right under Section 17 of the Act to ask for an internal
review in respect of this decision. This should be sent to
[2][Wirral Borough Council request email]. If you were dissatisfied with the
result of your internal review, you then have the right to complain to the
Information Commissioner who can be contacted at
[3]https://ico.org.uk/global/contact-us/

 

Yours sincerely

 

Lynette Paterson

Principal Information Management Officer

Wirral Council

PO Box 290
Brighton Street
Wallasey
CH27 9FQ

 

Email: [4][Wirral Borough Council request email]

 

Visit our website: [5]www.wirral.gov.uk

 

 

 

 

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References

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1. https://ico.org.uk/media/action-weve-tak...
2. mailto:[Wirral Borough Council request email]
3. https://ico.org.uk/global/contact-us/
4. mailto:[Wirral Borough Council request email]
5. http://www.wirral.gov.uk/

Dear Wirral Metropolitan Borough Council,

Please pass this on to the person who conducts Freedom of Information reviews.

I am writing to request an internal review of Wirral Metropolitan Borough Council's handling of my FOI request 'Reasons for Issuing a Cash ‘Settlement’ to the Nicklaus Joint Venture Group'.

The response to my request has as expected, come as a disappointment. The reasons given for refusal are somewhat ambiguous, given the public statement made on behalf of WBC by Phil McCourt (Director of Law & Governance & Monitoring Officer) and I quote:

“Dear Members,

I write to inform you that we have entered the settlement agreement with Nicklaus Joint Venture Group Ltd (NJVG) and they have this afternoon confirmed that the monies to be paid under that have been received.

This matter is therefore complete and, as such, the necessity for confidentiality on the grounds of privilege now no longer applies and the settlement agreement may be considered a public document. That reflects the decision made at Council last week that:

(i) the Council’s payment to NJVG of the sum of £495,000 is in full and final settlement of, all and/or any actions, claims, rights, demands and set-offs, that either party may have in relation to the Dispute and another agreement or matter arising or connected with the relationship between the parties;
(ii) the Council is released from any and all obligations under the Development Agreement;
(iii) no fault or admission of liability rests with the Council; and
(iv) no obligation of confidentiality shall apply to the content of the settlement agreement."

Point (iv) is of particular interest – “no obligation of confidentiality shall apply to the content of the settlement agreement.”

The questions I have asked are specifically about the settlement agreement in context with the original Development Agreement, (most of) which remains in the public domain. The refusal of my request is a complete antithesis to Point (iv) of the council's statement.

It would be interesting to see how the ICO interpreted the council’s statement of “no obligation of confidentiality” in conjunction with its refusal to supply information about the settlement agreement.

Furthermore, the nature of my request may not be strictly limited to the Freedom of Information Act 2000 and according to the ICO, may well be classed as ‘environmental information’ covered under the Environmental Information Regulations 2004. To quote from the ICO:

“…sometimes information might not seem to be obviously environmental but could still fall under the definition. For example, financial information would be classed as environmental information if it related to the costs of redeveloping land and building a new leisure complex.”

I have requested information surrounding a financial settlement pertaining to an abandoned golf resort project which can certainly be classed as a ‘leisure complex’ requiring a huge undertaking in terms of costs redeveloping the land.

I suggest to the council that the concept of “legal professional privilege” was waivered in very clear language in the statement made by the council’s Director of Law & Governance & Monitoring Officer in August 2021. Therefore, the council must either publicly declare their officer’s statement was erroneous and withdraw it or abide by its content and provide the information I am asking for.

The refusal for my request suggests the council must hold the information I am seeking and as such, do not have to create any information that does not already exist.

A full history of my FOI request and all correspondence is available on the Internet at this address: https://www.whatdotheyknow.com/request/r...

Yours faithfully,

NJT Lauro

InfoMgr, FinDMT, Wirral Metropolitan Borough Council

1 Attachment

Dear N J T Lauro

 

Thank you for your email of 23 September 2021 requesting an internal
review in which you stated:

 

‘The response to my request has as expected, come as a disappointment. The
reasons given for refusal are somewhat ambiguous, given the public
statement made on behalf of WBC by Phil McCourt (Director of Law &
Governance & Monitoring Officer) and I quote:

 

“Dear Members,

I write to inform you that we have entered the settlement agreement with
Nicklaus Joint Venture Group Ltd (NJVG) and they have this afternoon
confirmed that the monies to be paid under that have been received.

This matter is therefore complete and, as such, the necessity for
confidentiality on the grounds of privilege now no longer applies and the
settlement agreement may be considered a public document. That reflects
the decision made at Council last week that:

(i) the Council’s payment to NJVG of the sum of £495,000 is in full and
final settlement of, all and/or any actions, claims, rights, demands and
set-offs, that either party may have in relation to the Dispute and
another agreement or matter arising or connected with the relationship
between the parties;

(ii) the Council is released from any and all obligations under the
Development Agreement;

(iii) no fault or admission of liability rests with the Council; and

(iv) no obligation of confidentiality shall apply to the content of the
settlement agreement."

 

Point (iv) is of particular interest – “no obligation of confidentiality
shall apply to the content of the settlement agreement.”

The questions I have asked are specifically about the settlement agreement
in context with the original Development Agreement, (most of) which
remains in the public domain. The refusal of my request is a complete
antithesis to Point (iv) of the council's statement.

It would be interesting to see how the ICO interpreted the council’s
statement of “no obligation of confidentiality” in conjunction with its
refusal to supply information about the settlement agreement.

Furthermore, the nature of my request may not be strictly limited to the
Freedom of Information Act 2000 and according to the ICO, may well be
classed as ‘environmental information’ covered under the Environmental
Information Regulations 2004. To quote from the ICO:

“…sometimes information might not seem to be obviously environmental but
could still fall under the definition. For example, financial information
would be classed as environmental information if it related to the costs
of redeveloping land and building a new leisure complex.”

I have requested information surrounding a financial settlement pertaining
to an abandoned golf resort project which can certainly be classed as a
‘leisure complex’ requiring a huge undertaking in terms of costs
redeveloping the land.

I suggest to the council that the concept of “legal professional
privilege” was waivered in very clear language in the statement made by
the council’s Director of Law & Governance & Monitoring Officer in August
2021. Therefore, the council must either publicly declare their officer’s
statement was erroneous and withdraw it or abide by its content and
provide the information I am asking for.

The refusal for my request suggests the council must hold the information
I am seeking and as such, do not have to create any information that does
not already exist.’

 

The Council have reviewed your request and the response provided.   Having
done so we confirm as follows:

 

 1. We find no reason to revise the original decision.  The statement of
the Director of Law and Governance was waiving confidentiality of the
settlement agreement and there was no waiver of any legal advice
regarding the dispute. The legal advice  remains legally and
professionally privileged and confidential.
 2. The legal advice relates to a legal dispute in which  there was
monetary claim  against the Council  and is not sufficiently connected
to measures relating to environmental information to come within the
scope of EIR.

 

As such, we uphold our original decision under Section 42 exemption. If
you remain dissatisfied with the result of your internal review, you have
the right to complain to the Information Commissioner if you wish who can
be contacted at

[1]https://ico.org.uk/global/contact-us/

 

Yours sincerely

 

 

Tracy O'Hare

Information Management Officer

Wirral Council

PO Box 290

Brighton Street

Wallasey

CH27 9FQ

Email:[2][Wirral Borough Council request email]

Visit our website: [3]www.wirral.gov.uk

 

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This email and any files transmitted with it are confidential and intended
solely for the use of the individual or entity to whom they are addressed.
If you have received this email in error please notify the system manager.

References

Visible links
1. https://ico.org.uk/global/contact-us/
2. mailto:[Wirral Borough Council request email]
3. http://www.wirral.gov.uk/