A “sorry history” of alleged broken promises and thwarted money dreams emerged in London’s High Court yesterday (July 29) as Flaxby developer, Skelwith Leisure battled with a Knaresborough farming family over a stalled £7million land deal.
The tortured High Court dispute revolves around Skelwith Leisure Ltd’s long-running project to develop the Flaxby site - near the A59 between York and Harrogate, near Knaresborough.
The company has floated a variety of different plans for the land, which was sold to them by the Armstrong farming family in 2008.
Most recently it has mooted the idea of building 2,500 new homes as part of a new “village” scheme after abandoning plans to build a £100 million luxury golf resort complete with five star spa hotel.
But lawyers for the Armstrongs, who have farmed in the area for generations, say the company’s development proposals have stalled amid a lack of financing and willpower, and the case has now reached court as teams of lawyers argue over the fall-out from the purchase.
Mark Warwick QC, for 80-year-old Alan Armstrong and his family, disclosed that his clients have now “lost all confidence” in Skelwith Leisure’s ambitions, and are now seeking to develop the land through another venture project.
He related how Mr Armstrong had built up his farming business based around Allerton Grange Farm, acquiring increasing parcels of land over the years since 1959. Much of the family’s farming activity in those days involved rearing pigs.
In the 1990s, the family exploited part of its land for development as a “highly successful” 18-hole golf course through a local developer.
However, in 2008, the Armstrongs agreed to sell part of their land to Skelwith Leisure for £7 million after the company suggested taking the golf club “up market” by building a substantial hotel on site.
Of the £7million total, around £650,000 represented “payment for the goodwill”, said the barrister.
But the project unravelled as the recession took hold, the court was told, and the Armstrong family now complain that Skelwith Leisure have failed to make key “capital repayments” over the years.
“The history has been a sorry one - of failed refinancing proposals and broken promises,” Mr Warwick told the court.
“By January this year the family had lost all confidence in the claimants’ ability to repay them,” he added.
Faced with this deadlock, the Armstrong family began dealing with an alternative buyer and developer, the Ward family.
And, in February this year, Skelwith Leisure secured a court order preventing “any dealings with the property” pending the outcome of the legal dispute.
The case has now come before Mr Justice Newey as Skelwith Leisure urge him to “strike out” the Armstrongs’ defences.
The company says “summary judgment” should be granted in its favour.
The hearing continues today.
Last week the Skelwith Group announced that its subsidary Skelwith Leisure had gone into provisional liquidation, and another arm of the firm which owns luxury hotel Raithwaite Hall in Whitby Skelwith Leisure (Raithwaite) Limited went into administration a few days later.
Skelwith Leisure blamed the costs of a legal dispute over the ownership of the land at Flaxby Golf Course as the reason it entered liquidation, but said the move would have no impact on its plans to build 2,300 homes which it put to Harrogate Borough Council’s planning department in June.