A LEGAL battle which could have seen Daventry District Council (DDC) lose £3 million has been settled in the council’s favour.
The High Court announced the council had won its appeal against a ruling over its pension dispute with Daventry and District Housing (DDH).
The Court of Appeal also rejected Daventry and District Housing’s request for permission to appeal to the Supreme Court.
In addition to not having to pay out the £3 million, DDC will also be able to recover its legal costs – expected to be around £425,000.
Chris Millar, leader of DDC, said: “We always believed we had a strong case and the court would put right what was nothing more than a simple mistake on the face of the stock transfer contract.
“I hope that the Court of Appeal judgment draws a line under this unhappy saga and the council and DDH can now move forward.
“The council decided to commence legal action only after strenuous attempts to resolve the dispute with DDH failed and in the interests of protecting the public funds which the council holds for the benefit of the people it represents.
“This outcome vindicates the approach we have taken.”
The row dates back to 2007 when DDC sold 3,000 council homes to DDH and transferred its staff to them.
The council said during the handover DDH agreed to pay £2.4 million less for the homes and instead put the cash towards the workers’ pension fund deficit.
But a clause in the contract said DDC was responsible for this money – an error the council claimed DDH was aware of all along.
However, DDH went on to say it never made such an agreement over the payment.
Referring to comments from a previous judge that some of DDH’s witnesses were “unsatisfactory” and “not telling the truth”, Cllr Steve Osborne at a council meeting on Thursday last week, said: “It’s a shame as I thought we were dealing with a quality organisation.”
Ian Vincent, managing director of the council, told the same meeting: “An important thing is that the money doesn’t come to us as a council. It goes to Northamptonshire County Council [which runs the pension scheme].
“DDH will pay up to £2.4 million and therefore at the next pension assessment, it will see us paying less, up to the same amount.”
Currently DDC’s pension deficit is believed to be around £15 million.