Purpose

This matter relates solely to a
proposed confidential offer of settlement of a claim made against
the Council for statutory compensation in connection with
acquisition of land pursuant to the London Borough of Croydon
(Whitgift Centre and Surrounding Land bounded by and including
parts of Poplar Walk, Wellesley Road, George Street and North End)
Compulsory Purchase Order 2014 (“the CPO”) confirmed by
the Secretary of State in September 2015.
 
Under the terms of the CPO
Indemnity and Land Transfer Agreement (known as the ILTA) with
Croydon Limited Partnership (“CLP”), the developer has
indemnified the Council for all its costs associated with the CPO,
including in respect of claims for compensation such as
this.  The costs of any settlement would
be met from sums paid by CLP held in an Escrow Account, whilst the
Council’s professional fees (including those for its in-house
lawyers) are covered by the general indemnity in the ILTA. As such,
this decision does not have cost implications for the
Council.
 
This decision also has no
implications for the wider Town Centre regeneration and the ILTA
remedies / projects (agreed by Cabinet in September 2024), as it
relates to legacy CPO compensation.
 
Important:
The Chair of Scrutiny & Overview has consulted
with Officers and approved the use of Special Urgency for
this decision, as of 25 April 2025 and
also a Waiver from Call-In has also been agreed for
this decision, so if and once agreed, the Officer recommendations
can be implemented immediately.
 
Details are included in a
confidential Part B report which is exempt under paragraphs 3 &
5 of Schedule 12A to the Local Government Act 1972 as the public
interest in maintaining those exemptions outweighs the public
interest in disclosure. This is because the report contains advice
which is subject to legal professional privilege relating to a
legal claim against the Council and information relating to the
financial and business affairs of the claimants, the developer and
the Council.
 
REASONS FOR RECOMMENDATIONS
 
If attempts are not made to
settle, the matter may involve lengthy, complex and costly legal
proceedings. The Council’s costs are indemnified in full by
CLP and the Council must work in partnership with CLP to seek to
resolve the compensation claim. The recommendations in this
report offer the possibility of
settlement of the claim and may, in any event, provide some
protection against the costs’ implications.
 
ADVICE ON SETTLEMENT
 
The Council’s external
legal and property advisers agree that a settlement offer, on the
terms proposed in the Part B report, would be a prudent course for
the Council to adopt.
 
 
CONTRIBUTION TO THE MAYOR’S BUSINESS PLAN
 
This will enable the Council to
meet corporate priority OUTCOME 1: The Council balances its books,
listens to residents and deliver good, sustainable services. This
is because settling the matter will avoid time spent on litigation.
Also OUTCOME 2: Croydon is a place of
opportunity for business, earning and learning- Priority: support
the regeneration of Croydon’s town and district centres,
seeking inward investment and grants.
 
FINANCIAL IMPLICATIONS
 
VAT will be payable by the
Council on the compensation settlement amount.   Recovery of the amount of VAT paid out will
be sought from HMRC.
 
Otherwise, there are no direct
financial implications in relation to this report. This is because
compensation monies are held in Escrow and CLP fully indemnifies
the Council.
 
LEGAL
IMPLICATIONS
 
Pursuant to clause 1(1) of the
Localism Act 2011 a local authority has power to do anything that
individuals generally may do. The Executive Mayor has the power to
exercise executive functions pursuant to s9E of the Local
Government Act 2000 and has the power to delegate those functions.
The delegations in the Cabinet report on 11th June 2018 have
subsequently been confirmed as still relevant on 16th August 2021.
Further legal implications are set out in the Part B
report.
 
OPTIONS CONSIDERED
 
Alternative options are to
agree the claim in full, or to make no offer of
settlement.  Further details are
included within the confidential Part B report.
 
BACKGROUND PAPERS
 
Cabinet report September 2024
“Whitgift Indemnity and Land Transfer Agreement (ILTA) Remedy
– Update”
 

Content

For the reasons set out in the
confidential Part B report, the Corporate Director of Sustainable
Communities, Regeneration & Economic recovery, acting in
consultation with the Director of Legal Services & Monitoring
Officer, AGREED to:
 
1.1      
Authorise the making of an unconditional offer of
settlement on the terms set out in the Part B report (without
prejudice, save as to costs) of a claim for statutory compulsory
purchase compensation which has been referred to the Upper Tribunal
(Lands Chamber)
 
1.2      
Agree the additional recommendations as set out in
the confidential Part B report.