Can a council have a maintenance contract for 85 years?

Question

My thanks first of all to all who answered my other question , Can a council give away assets?

My second question is because in a draft head of terms for the sublease it proposes that the council pays £20k per year to the charity towards maintenance for the next 85 years upgraded inline with inflation annually. This is not a grant that they can choose to give or not but would be part of an obligation on a legal document. Last years cost was only just over £18k. Can you force future councils to pay such a sum? To me it is a maintenance contract for £1,700,000 and that is without putting in the inflation increase.

Answer 1

See my previous advice (and that of DavetheClerk).

Comments

Thank you. Have shared that advice but wanted to be clear that this is not a grant. The proposal is to tie the council in legally for 85 years to a payment without allowing any other body to offer to do the maintenance. The suggestion of the 20k reducing annually is an interesting one and has merit. The draft lease also has that the council and councillors should unreservedly support development and I do not see that any lease can force a councillor to support something if they believe it is not in the public interest.

Answer 2

Do not do this under any circumstances. Every aspect of this is wrong. From the information you have provided, I believe that the Council would be acting ultra vires if they proceed. Councillors and Officers of the Council enjoy statutory immunity from civil liability where they act within the powers of the Council, in good faith and without negligence. However they can incur personal, civil, and criminal liability whilst acting on behalf of the Council if they go beyond the powers of the Council or act in bad faith or negligently, or when they are acting on outside bodies to which they have been appointed by the Council.

Comments

I am an ex councillor and believe the action the current council are trying to take is wrong, possibly breaking financial regulations. If it is legal then I can not complain but there are many residents that are worried. The current clerk has only one years experience and only two members of the council were on the last council and both of these are current or previous trustees of the charity/company that they propose to sublease to. Three other new members of the council have connections also to the sports clubs, I believe.

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Does the charity have limited liability status or is it an unincorporated association? Either way, an annual payment to the charity is a grant, whether decided annually or written into a legal agreement. The charity is clearly not a suitable body to take on such a responsibility. The Council must write stringent safeguards into any lease, which should be for a short time initially to allow the charity to demonstrate that it has the capability to manage the facility. Who wrote the draft lease and are they suitably qualified? Has anyone discussed this with your local NALC association and ACRE branch? What is the perceived benefit of letting the property to a third party? Have the VAT implications been explored?

If this lease is signed, the members of the Council at the time, whether voting for the motion or not, could be personally liable to reimburse the Council for the full value of its losses.

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Thank you. I will pass your comments to residents who are very concerned.

Answer 3

Are you asking this question as a clerk, a Cllr in favour, a Cllr not in favour or a member of public?

The answer (recklessly irresponsible madness) is essentially the same which ever the basis for the question - but the phrasing of the answer would differ slightly depending on the status of the OP

Comments

I am an ex councillor and now a member of the public. I believe it could be illegal and am not alone in being concerned. The conflicts of interest are great, though only one has a pecuniary interest. I share information with concerned residents and try to only base things only documents I have read or law. Other ex councillors feel the same. Usually one council or government can overturn a decision of the previous one but the draft lease submitted by a councillor would mean, if agreed, all future councils would be committed to the terms. Worse. The charity/company has only £45 and has no written business plan, nor maintenance plan and I have asked for a trustees report to get a response saying the person concerned was too busy. I agree it is madness.

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You are absolutely right to be concerned as a tax payer. It sounds like an unfathomable example of ego(s) overtaking common sense.
If you believe there are “interests” which should be declared you might report the facts to the MO (for all the good that will do) apart from that - you might generate public interest and mass attendance at council meeting.
Mass declaration of public objection can be a very effective tool.

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PS   Other things to do to avert this madness - complain to the charity (written) and when no reply complain to the Charity Commission re the charity.  Complain to the district councillor, write to the MO, write to your MP.  In all probability the lease would be illegal, so even if signed by the then councillors and clerk, it would be easily overturned.   Crowd fund for a judicial review if the councillors are so inept that they do sign up to it.

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Thank you everyone. I will pass your comments to residents who are very concerned.