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Fylde's Tyranny

Fylde's TyrannyJust when you think it couldn't get any worse;  it does.

counterbalance has previously exposed the underhanded and deceitful way the last incarnation of Fylde Council discharged the duty and responsibility that everyone (except the Conservative Group on the Council) understood it had to operate Melton Grove as a retirement haven for worthy local residents of meagre means, and to make sure that opportunity stretched out into the future, thus ensuring the needs of future worthy people in need were also protected.

Now, as the endgame approaches, it gets even worse.

When those in charge find they come under pressure to be open and transparent,  they simply change the rules.

This article is a story of tyranny, of the abuse of power, and the silencing of dissent.

It disgraces those directly involved in its doing, and those who stand by and watch as it happens.

Many good people have supported the Melton Grove Residents Association in their campaign to secure justice. They should have the same sort of fair treatment given to residents of other council housing areas in Fylde, (as happened when the Council previously considered the transfer of the bulk of their housing stock to a Registered Social Landlord).

Some supporters have given money. We set out in 'A Humbling Experience' how we had been deeply touched by the generosity of counterbalance readers in response to our appeal for support to help fund a barrister's opinion. The latest Melton Grove Residents Newsletter thanks them all, saying "Counterbalance's very kind readers have now raised an amazing 1650. Very close to the 1800 we needed."

Some people have given of their time and expertise. Several professionals - Solicitors, accountants, housing specialists, and those with business experience - have worked pro-bono to offer their support; and the advice of the barrister has been sought.

The process to provide the barrister with information about the case included an analysis of the minutes of the meetings of the Clifton (Lytham) Housing Association - and that exercise turned up some - shall we say - 'interesting trails' that have been, and are still being, followed further.

Melton Grove is currently 'owned' by the Directors of the Clifton (Lytham) Housing Association. Each of these has a share in the Company. The Directors are appointed by a meeting of the full Fylde Borough Council. Thus - as it says in the Company Accounts - "by virtue of the fact that the shareholders of the company were also Councillors for Fylde Borough Council, the company was effectively controlled by Fylde Borough Council"

Furthermore, their letter heading, which shows the company address as being the Town Hall says "The Clifton (Lytham) Housing Association is a company controlled by Fylde Borough Council"

And that was the case until 11 January 2011 when the tyranny began and the requirement to be a Councillor ceased to be a prerequisite for Directors.

That change was made to the Company's Articles of Association without the matter being voted for by the full Council and, so far as we can ascertain, it was not even put for consideration to the Council.

It was changed by a majority vote of the Directors of the company.

If this is allowed to stand, it is the first tyranny. It abused the right of the Council to "effectively control" the actions of their Directors. We believe it was also intended to silence opposition by hiding the change that had been made from the other 46 Councillors (who were not Directors of the Company).

Even today, we suspect few (if any) of the other 46 Councillors know this has happened.

It was probably done as a prelude to the sale of the company to a local developer (who was not a councillor). But the change has also produced an interesting side-effect.

Two of the people who were Directors - Patricia Fieldhouse and Roger Small - stood down in the May elections and from 6th May 2011 they were no longer Councillors. So the Board now has four Directors who are Councillors and two who are not.

It is a moot point whether the Council can now "effectively control" (or even remove) those two people as Directors, since they are no longer under its control. We wonder how the remainder of the Council feels about that, and how such a situation could have come about without the Council being consulted.

Equally, the position has changed for the two involved.

When they were Councillors, they enjoyed the protection of something akin to 'professional liability' insurance that was provided by the Council. That was intended to protect them from legal claims made against them in respect of their actions as councillors.

But now they are no longer Councillors, that protection will have evaporated, and we doubt that C(L)HA has any such insurance in place (because it wouldn't need it in addition to the Council's insurance).

It follows that these two Directors are on their own now, and decisions they make as Directors would, in our view, render them personally liable to actions for damages if any of the residents of Melton Grove who are disadvantaged and lose out financially as a result of the Director's decisions, choose to pursue an action for their loss.

The second act of tyranny is even worse, but is a bit more complex to explain, so bear with us as we try.

In September 2009, after receiving an updated report from Fylde's Chief Executive Philip Woodward called 'Shaping the Future', the C(L)HA Directors decided to buy the freehold of the Melton Grove land, and to receive an 'Options Appraisal'

(We may deduce from this that the driving force behind what is happening at Melton Grove stems from Mr Woodward's vision of the future).

Two months later, in November 2009, Mr Woodward provided his further report. This was about proposals to obtain the 'Housing Options Appraisal' in relation to Melton Grove. Mr Woodward recommended seeking quotations to provide this appraisal.

A copy of his report (which included a schedule of requirements) was circulated with the agenda.

A supplementary sheet was also circulated at the meeting detailing "four regional surveying practices with appropriate expertise of asset management and development."

In addition, details of four housing consultancies which specialised in providing advice, guidance and support to registered social landlords was also included in the supplementary information.

As a result of considering Mr Woodward's report, the Directors decided to approve his 'Housing Options Appraisal' report and invited the four surveying practices as detailed in the supplementary report to submit quotations (including a new valuation) for the work.

So, based on Mr Woodward's advice in those reports and, presumably, at the meetings he attended, the Directors decided to proceed as he recommended.

Readers will note that these documents have a curious status.

If they are the property of a private limited company and thus confidential, why was the Council's Chief Executive preparing and delivering them?

And if they were provided as part of the Council's work, why were they not appended to or reproduced in the minutes, and even more importantly, why were they not first reported to, and approved by, a meeting of Fylde Borough Council who appoint  the Directors of the Clifton Lytham Housing Association?

(As an aside at this point, you also see here exactly the sort of deception and lack of transparency that arises when Councils are allowed create and run private companies).

But, more specifically, what you also see, are documents that set out what was to be achieved, and who might be involved in bringing it about.

The Directors met again at the Town Hall, St Annes on 8 February 2010.

Also present were

  • Phillip Woodward, FBC's Chief Executive
  • Bemard Hayes, FBC's Finance supremo
  • Barry Dean - Morris Dean- Chartered Surveyors
  • Progeny Consultants

The minutes note that "Mr Barry Dean of Morris Dean, Chartered Surveyors and Property Consultants was in attendance at the meeting and presented a report on the provision of Housing Options Appraisal for Melton Grove. The report set out 8 Options for the future including 2 options relating to retention by the Association/Council and 6 options relating to asset sale."

As a result of his report to the meeting, the Directors decided to accept Option 3 (Asset Sale). They further agreed that expressions of interest be sought for the Company from Registered Social Landlords, to enable negotiations regarding protection of rent levels, covenant arrangements and development claw back potential to be undertaken prior to disposal.

On 13 November 2010, the Directors again met at the Town Hall.

This time they received a report from the widely respected Price Waterhouse Coopers. Chiefly this was about financial arrangements and the structuring of the disposal to minimise tax liability. (The proposals from the Registered Social Landlords that had been sought all wanted the Directors to transfer the land and buildings, but this would risk significant tax liabilities).

Mr Barry Dean, (again "of of Morris Dean, Chartered Surveyors and Property Consultants") presented a further report and recommended that "subject to tax planning measures Option 2 - Windmill Group would be the preferred option"

So what we have here is the Chief Executive's report which resulted in Mr Barry Dean being chosen as an adviser, and Mr Dean bringing forward a recommendation to sell to the Windmill Group (which is not a Registered Social Landlord) subject to a commitment that "there would be no pressure on current tenants to terminate their tenancies" (but no mention of protecting the future of Melton Grove for the worthy of meagre means in Lytham St Annes).

Now dear reader, a few things strike us here (and we think there is yet more to come out about this).

As we reported in 'Melton Grove Scandal' (when we broke the story last February), the Directors had been told of an "increased offer" by Windmill.

We said at the time: "The "increased offer" by the Windmill Group (so much for open tendering, so much for transparency, so much for honesty and openness) was said to increase the tax liability on the deal by 188,000. We figure that's a 'deal value' (God preserve us) of around 1.3 or 1.4 million."

The prospective purchaser actually wrote to us in forthright terms soon after we published to say "....the amount that the Windmill Group is purchasing Melton Grove for is the same level that we originally offered at the initial, tender stage."

(That statement was just before their paragraph threatening to instruct lawyers to take the appropriate action in the morning unless we removed the comment about the increased offer from counterbalance).

Evidence is still coming to light in this matter.

The Directors clearly believed they were in receipt of an increased offer. Their minutes of 3 November 2010 say "Michael Hope [of Price Waterhouse Coopers] referred to the Summary of Tax Liabilities in his report and informed the Directors that the increased offer by the Windmill Group would increase the tax liability on the asset deal to 188,000".

So firstly, the initial decision to dispose was to sell to a Registered Social Landlord, (not a property development company as is now the case).

That change appears to have come about because of money being offered - not because of the needs of the present and future tenants, and not because of the importance of the site in terms of its architectural and layout merits.

Second, we note there doesn't seem to have been a process recording the selection of Mr Dean "of Morris Dean, Chartered Surveyors and Property Consultants" from the other four quotations submitted. (Nor for that matter 'Progeny Consultants' - whoever they were)

Thirdly: if this was the case; and it was Fylde's officers who made the selection of advisors and consultants, then the Directors would probably have had no idea about the background or circumstances of the advisors they were presented with. They would be reliant upon the Council's officers doing that research on their behalf.

What we can now tell readers is that, at least superficially, the investigations into those who were selected to advise the Directors do not seem to have been very thorough.

For example Mr Dean "of Morris Dean, Chartered Surveyors and Property Consultants" had his appointment as a Director of Morris Dean Limited terminated on 7 July 2008. His appointment as Secretary was also terminated on the same date.

That's 18 months before he was introduced to the Directors as Mr Barry Dean "of Morris Dean, Chartered Surveyors and Property Consultants"

Furthermore, Property Week of 8th August 2008 reported that "Barry Dean has joined B&E Boyes as a non-executive director. He joins from Rochdale-based surveyor Morris Dean"

As at June 2011 the directory 192.com records Mr Dean as being a Director of

  • Barry Dean Associates (Incorporated 08.09.2008)
  • Rebecca Court (Milnrow) Freehold Co Ltd
  • Henbury Consulting
  • Rebecca Court (Milnrow) Management Co Ltd
  • He was also listed as being a past director of Morris Dean Ltd

Now, a couple of things spring to mind here.

Firstly, even if he was no longer Director or an employee of Morris Dean when he advised the Clifton (Lytham) Housing Association, he could still claim to be a freelance agent of some sort acting for them of course.

But in order to be sure about the competence, accuracy and reliability of the information they were given, the C(L)HA directors ought to have known about his status.

We can say with certainty that not all of them did, and we would not be surprised to find that none of them did.

Secondly we have to ask: if his selection was made by officers of the Council on behalf of the Directors, was proper checking of the credentials of potential advisors undertaken or not. And if not why?

In short we need to know whether the inaccurate or misleading status of Mr Dean was a cock-up or a conspiracy.

Was it plain incompetence (yet again), or is there some more sinister connection between the parties involved in this process of disposal?

Some of our readers have already alleged to us a closeness between one or more officers at Fylde and other players in this story which, if true, might well be inappropriate in the circumstances.

So in view of such allegations, we think the public has a right to know the full circumstances of the advice provided both by Mr Woodward and Mr Dean, and about how the "increased offer" came to exist.

We firmly believe the Directors of C(L)HA should know as well, and indeed that they have a duty know.

With that in mind, an approach was made to Cllr Louis Rigby.

Readers will recall he stood out against the dominant Conservative Directors of C(L)HA and has refused to sign documents to transfer his share. A process which, once agreed, would enable the disposal of the Company first to the Council (as a single shareholder), then to a developer.

We're told that after hearing the facts, Cllr Rigby was not aware of the confusing status of Mr Dean, and he wanted to re-visit the documentation with which Mr Dean was connected.

So on Monday 13 June, Cllr Rigby went to the Council's Solicitor Mr Curtis, and asked for a copy of the documents previously presented to the Directors (which he no longer had), namely:

  • Mr Woodward's 'Shaping the future' report,
  • Mr Woodward's report about how to obtain the Options Appraisal.
  • The Schedule of Requirements
  • The supplementary sheet detailing four regional surveying practices and the four housing consultancies who specialised in providing advice, guidance and support to registered social landlords, and
  • The Options Appraisal report itself, and the subsequent report, provided by Mr Dean.
  • He also asked for a copy of the "external advice" provided by Price Waterhouse Coopers about financial matters concerning the transaction.
  • Finally he asked for a copy of the draft Terms of Sale agreement which only one or two Councillors appear to have seen thus far, and which is supposed to safeguard the existing residents and future development of the site.

We understand Mr Curtis said he could have them, but it would take a few days to get them together.

However, by the end of the week, sources close to Cllr Rigby have told us that Mr Curtis sent Cllr Louis Rigby and other Directors a letter which began ....

"The chairman Councillor Patricia Fieldhouse has asked me authorised me to call a board meeting of Clifton (Lytham) Housing Association Ltd to consider proposing a special resolution to further amend the constitution of the company in preparation for the transfer to Windmill Oaks Ltd."

Readers will note Mrs Fieldhouse is not a Councillor (and has not been since 6 May), that Mr Curtis appears unsure whether he has been asked or instructed by her, and he believes the Company is governed by a 'Constitution' rather than Articles of Association.

This sort of thing happens when things are prepared with undue haste.

So an extra-ordinary meeting of the Directors is to be held tomorrow (Thursday 23rd June at 6pm) to vote on a Special resolution to the Memorandum and Articles of Association.

One of the changes clarifies how a Director can be removed from office by notice being served on them.

The letter concludes "If the board of directors agrees to propose the special resolution, the meeting will then adjourn for the shareholders to consider the special resolution. On the meeting being reconvened, the board will be asked to consider releasing certain documents that have been requested by Councillor Louis Rigby, one of the directors."

Fighting talk.

And absolute tyranny.

What has happened here is that a majority of the Directors, without Cllr Rigby's acceptance or authorisation, has applied to amend the Memorandum and Articles of Association of the Company once again.

The effect of their resolution is to remove almost all the restrictions on the Company.

Apart from removing clauses wholesale, the other point of note is the addition of a clause that says simply "The liability of the members is limited"  There are no more articles left, not even the name of the Company.

Given that the two 'non-council' Directors will have made this decision when their liability is not limited, we're not altogether sure if they will remain personally liable for its future actions or not.

But the change seeks to remove the company from any control by the Council.

Readers can follow this link to see the latest amendments to the M&AA

It appears to us as though those involved are preparing the ground to remove the brave and stalwart Councillor Louis Rigby who morally and ethically towers above them.

And to do it by the back door.

When no-one is looking.

When you can't win by the rules; you simply change the rules. Easy Peasy.

For a company whose own accounts say "by virtue of the fact that the shareholders of the company were also Councillors for Fylde Borough Council, the company was effectively controlled by Fylde Borough Council" we wonder how the Directors can be allowed to institute a change to remove themselves from the control of the body that appointed them in the first place.

But sadly, the effect of this, if it goes ahead, will be to see the removal of Cllr Louis Rigby from the Board of Clifton (Lytham) Housing Association, and to prevent the documents that we suspect - especially given the draconian moves being made that could prevent their being seen - would show up misdealing and underhanded practice that has led to this situation.

Much of this has happened because of Mr Woodward's failure to discharge the Notice of Motion for the Council itself to debate the future of Melton Grove.  (As proposed by Cllr Elaine Silverwood and seconded by Cllr David Chedd at the last Council meeting), and his failure to produce accurate minutes of the meeting (as we reported in 'Call for Help: Melton Grove').

This has forced him into accepting it as a Notice of Motion to be debated on the next Council meeting in July.

It also means the minutes of the Council meeting of 28 March have yet to be approved, so we believe there is yet no finality on Cllr Fiddler's decision, (which was called in by Scrutiny and referred to Council so that Cllr Fiddler or the Cabinet could reconsider the decision they were about to take with the benefit of the Council's view).

Nor can there be such finality, until the minutes of that Council meeting are confirmed.

We heard gossip at one point suggesting Mr Woodward had hoped to persuade Cllr Silverwood to withdraw her notice of motion. But we currently have no proof of that, so whether it is accurate or not we simply can't say. What we can say that Cllr Silverwood isn't the sort of pink and fluffy person to knuckle under at the request of a Chief Executive who was shown to be administratively incompetent at the March meeting.

So rather than risk the full Council coming to a different view about the disposal at their next meeting in July, (and overriding the Directors they both appointed and, - up to tomorrow -, that they "effectively control") - it looks as though Mr Woodward is progressing toward removing the company from the "effective control" of the Council altogether, and might be heading toward doing so before the Council Meeting that will debate the disposal in July.

Those involved in this process, and those who stand on the sidelines watching and doing nothing, need to hang their heads in shame.

We know some of them personally, but by their actions - and in some cases inaction - on Melton Grove, they have put themselves beyond the pale.

Barring intervention by an external agency such as Government or the Courts, (and that is still just possible, but increasingly unlikely) the Conservative majority - if it performs as it has done before and works as a block vote - will not stop this process.

Those prosecuting this matter are a public disgrace.

Fylde Council has become a tyrant in its own borough.

We hope there are some Conservatives amongst the new intake who are as appalled by what they will be asked to support in this matter as we, (and many other local people) are, and that they will vote with their consciences.

And to that end we can probably do no better than quote one of the new intake of Conservative Councillors.

In 2008 Mr Tim Armit, writing about the closure of St Annes Swimming Pool said....

"What is a council for? Think back to our small villages choosing the elders to look after them, to represent them, to ensure all that the village needed was in place. When did Fylde borough change from being the people's representative and enabler to, in most people's opinion, the enemy? The people stopping things happening, the people damaging the very town we want them to represent? Is this right? Is this what a council should be? "

Perhaps in 2011 Councillor Tim Armit's views will have more poignancy, as he and others from the new intake are required to support the collective decision of the Conservative group on this matter which, of course, is actually made in private.

But at least the vote at Council will still be taken in public.

We end this article with the words of Emma Duffy whose dad is a resident of Melton Grove.

She told us...

"The Council does not need the money and refuses to reduce its debt with the proceeds. The sale agreement has not been seen by anyone else but the Portfolio holder and the Councils' solicitor and they refuse to show it to anyone.

They will not release the tender documents and the developer who is buying it came in with a high bid after one of the three preferred social housing landlords had been chosen.

The developer claims to have social housing experience but has absolutely none.

The existing tenants have had two letters and that is all the consultation they have received.

The 13 year waiting list has been reduced to nothing as the criteria has been changed so no one fits and two properties have remained empty for two years.

The directors stressed that existing residents would not be put under any pressure to leave their homes and their tenancies would stand for life.

Since the sale was agreed, the developer has been a regular visitor to Melton Grove, calling on residents to "discuss the situation" and exercising his dogs off the lead. His dogs weren't the only ones marking their territory. He was often there mowing the lawns in front of the tenants' houses and measuring up between the trees. He has keys to the two empty properties and has visited them on many occasions. One resident explained to my Dad how Mr Whitehead and his wife were going to move in next door, adding that her cat would probably be safe from his dogs as he was going to build a fence around 'his' bungalow. Another resident was understandably upset when asked if he would not prefer to look out of his window at a lovely new-built house {instead of the beautiful lawns and trees where his late wife's ashes are scattered}.

The youngest tenant is in her 60's the majority are over 80 and one couple are in their 90's. No pressure??? They are distraught.

We know one tenant has been offered a financial package as his house is the first earmarked for demolition. They will have to live with bulldozers and redevelopment for the rest of their lives as one after another of the houses are demolished and developed. No pressure?

The whole process has been underhand and wrong.

I have three hundred signatures of people who have come to me to complain, the whole town is appalled at what is happening. When the vote on the sale took place at the last full Council Meeting the Conservative majority all voted together (no surprise there) and won by only one vote. Some left the meeting before they HAD to vote and some apologised to me after and said they had no choice. Not one Councillor from any other party or group voted for the sale. And still they plough ahead.

The loss of this town asset and the upset to the residents will benefit no one but the developer and no one will listen to us. Not the Council Officers, our MP or Government Office. We cannot keep paying out on solicitors and Barristers as the residents meagre savings are being reduced to nothing.

There is no need for this sale. the Melton Grove Residents Association has a Board of qualified professionals who can manage the Grove

No one wants this sale but a few Councillors and the developer and no one benefits but the before mentioned.

Please will someone do something about this now??

counterbalance says this tragedy can be stopped.

Cllr David Eaves has either supported - or at least failed to stop - elements within the Conservative party he leads from pressing ahead with it. He could still stop it at the 11th hour. Or he could do the honourable thing and step down as Leader so we can see who is really calling the shots.

The top officers at FBC seem to be in the driving seat of this matter, and some seem ready to assume significant 'reputational risks' in the process. They need to be careful in the associations they form.

Government - including senior people in Saint Eric Pickles' department - seems ready not to intervene from the housing angle, but they could (if they chose to do so), easily intervene in a party political sense, but they, and even our MP on this occasion, do not appear ready to exert the influence they undoubtedly have in this matter.

It is to the shame of all of them that they do not.

The betrayal of current and future residents of Melton Grove for thirty pieces of silver is not something that will lie down quietly and go away, even if it is imposed on them. It will become a perennial, festering sore that will be a source of ongoing pain into the future.

And we would not be surprised to find there is yet more to come to light on this matter.

Dated:   22 June 2011


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