The legal battle over part of the 40-acre Middlehaven development site, in
Local developer Chilli Developments is suing English Partnerships (EP) and Tees Valley Regeneration (TVR) for almost £10m in loss and damages for allegedly going back on a 2004 “lock-out” agreement relating to the redevelopment of five acres of the site.
In November 2006, TVR signed a deal with BioRegional Quintain to develop a 1m sq ft mixed-use scheme at the site of the former
Architect Will Alsop master planned the £200m scheme to include over 800,000 sq ft of offices, around 500,000 sq ft of leisure facilities and 750 homes.
In January 2007, Chilli sued alleging that during the lock-out period EP, induced by TVR, invited tenders and entered into negotiations with Quintain for the sale of the property.
Chilli also alleged that TVR spoke to Chilli’s lender, Allied Irish Bank, behind Chilli’s back and that EP and TVR undermined, insulted and ridiculed Chilli in the presence of a potential backer, with the result that the backer pulled out.
Opening the case for Chilli, Philip Noble said that the defendants were thereby “undermining the whole purpose of the agreement and effectively acting in bad faith” and “effectively sabotaging the progress of the bid by Chilli Development”.
In papers before the court EP and TVR’s barrister Tom Leech submitted that “the pleaded allegations are thin and there is next to no evidence to support them.”
He said the witness statement of Simon Brown, managing director of Chilli Developments, was “filled with innuendo and, at some points, scurrilous allegations”.
The case is scheduled to last up to five days.
