Threats by a property developer have led to Northumberland councillors agreeing to cover the legal costs of two senior colleagues and the authority’s chief executive.
At Tuesday’s meeting of the county council’s cabinet, members unanimously approved legal indemnities for council leader Peter Jackson, chief executive Daljit Lally and cabinet member for planning John Riddle, none of whom were present.
They would be capped at £10,000 initially and would also not apply if ‘their actions were fraudulent, deliberately wrong or reckless or not authorised by the council’, among other restrictions.
The indemnities relate to serious allegations made by Lugano over the ‘unlawful’ way the Conservative-led council has handled its application for the Dissington Garden Village, a development of up to 2,000 homes near Ponteland.
The Newcastle-based company also alleged wrongdoing by the three individuals mentioned before recently announcing that it had issued formal legal proceedings.
It is the council’s position that no action has been launched yet, although a lawyer’s letter has expressed that intention, and that the claim ‘is without merit on the evidence provided to date’.
Referring to the caveats placed on the indemnities, Coun Nick Oliver, cabinet member for corporate services, said: “There’s a lot of protection for the council in this structure.
“If there was anything found to be wrong, the council is protecting itself in the most appropriate way.
“This mechanism has been very carefully considered and set out really well.”
He added that providing this support to councillors and employees of the local authority was a very important principle.
“Otherwise you would have a situation where anyone who could afford an expensive London lawyer, who didn’t agree with a policy or project, could threaten legal action, and officers and members, who don’t always have deep pockets, could feel cowed.
“If we want good quality officers to work in the authority, we need to provide them protection to do their jobs properly.”
Coun Richard Wearmouth said: “People in an organisation have to be able to go about their business knowing that, if they have followed the law and due process, that organisation has a duty of care for them.”
Coun Glen Sanderson added: “It’s not unusual for this type of arrangement to be set up and it’s only right and proper that it is.”
Coun Oliver said that he hoped this was something that all political parties could support, but a spokesman for the opposition Labour group described it as ‘a reckless decision’.
He said: “We’ve just seen a Tory cabinet open up the taxpayers’ wallet to the tune of a £125,000 down payment to protect acts which were not risk-assessed at the time of the core strategy removal and have been universally described as reckless.
“This report and decision has been rushed through and raises serious concerns about the actions over the last three months since the developer set out its concerns to the Tory administration.
“Since then, the council has denied and buried its head in the sand over the true implications of this legal action.
“By not seeking to understand allegations of criminal wrongdoing and serious breaches of planning and local government law and ignoring them, we are now faced with a hugely expensive legal action which could have been avoided.”
It was agreed that an indemnity is provided to Couns Jackson and Riddle and Mrs Lally ‘for the purposes of obtaining independent legal advice and representation in respect of the action proposed by the developers of the Dissington Garden Village, and a similar indemnity is provided to Coun Jackson and Mrs Lally OBE in respect of action proposed by a former employee’.
The indemnity would be restricted to £10,000 at first, but could be extended in tranches of £15,000 ‘if it is reasonable’ for the council to do so.
However, the indemnity would not apply for any action committed ‘which is outside their authority from the council; where their actions were fraudulent, deliberately wrong or reckless or not authorised by the council; were outside the powers of the council; or where the matter exceeded their own powers and it was not reasonable for them to believe that their actions were within those powers’.
Plus, if a court finds that the trio ‘behaved improperly, illegally and outside their authority in relation to the developers, then the council is entitled to be refunded all costs paid out under the indemnity’.
Any costs recovered during the legal process would also have to be repaid to the county council.
Ben O'Connell, Local Democracy Reporting Service