The claim against Scottish Borders council was raised in the Court of Session in August 2013, dating back to claims made in 2011 by Barry Phelps, director of London-based management consultancy D&P Management Enterprises.
Mr Phelps was engaged by the local authority in December 2008 to lead on the procurement of the local authority’s long term waste treatment contract, believed to be worth around £80 million, which was signed by waste treatment firm New Earth Solutions in 2011 (see letsrecycle.com story).
The claim related to payments worth up to £4.2 million, which D&P Management Enterprises had claimed to have been due through a ‘gain-share’ agreement with the council, whereby the consultancy would be due a percentage of savings achieved through the contract.
The council contested that as the proposed facility that would have been built to service the contract – a 60,000 tonnes-per-year capacity gasification plant at Easter Langlee, near Galashiels – had not been built, no savings had been achieved, and it did not owe any payments to the consultancy.
Savings
But, Mr Phelps had argued that savings had been made through interim arrangements for the council’s dry mixed recycling and green waste which were handled by New Earth.
The contract with New Earth was last month scrapped by Scottish Borders council following concerns over funding and the waste treatment technology to be used, a decision which the council claims had no bearing on the case (see letsrecycle.com story).
An 11 day Court of Session hearing on the case was due later this month, but on March 5 D&P Management Enterprises agreed to drop the case and to pay £20,000 towards the council’s legal fees. A final court order was granted on Friday (March 13) absolving the council from the claim.
Tracey Logan, chief executive of Scottish Borders council, said: “The council disputed this claim in its entirety and argued that no sum was due. We have been confident since the claims were submitted nearly four years ago and the court case was raised 19 months ago that our stance was the correct one. We are obviously very pleased that Mr Phelps has, belatedly, agreed that the council’s position should not be challenged.”
Costs
However, Mr Phelps has claimed that as a result of the contract having been scrapped he would have had to alter the terms of his claim, at significant cost, and has instead opted not to pursue the action.
Speaking to letsrecycle.com today (March 18), the consultant said he was disappointed with the outcome of the proceedings, but did not feel it was appropriate to continue with the case.
He said: “I took the opinion that if they have terminated the contract it is not suitable to pursue it.”
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