Northampton Borough Council’s cabinet has been provided a behind-closed-doors update on how the authority intends to recoup some of the £10.25million Cobblers loan.
In January the council won a civil court case against former Northampton Town FC owners David and Anthony Cardoza.
Judge Simon Baker QC ordered Anthony to pay back £2.1million, while David was told to pay back sums used to fund the development of his Cheriton house in Church Brampton. He said the duo had ‘breached their fiduciary duties’ as directors of the football club.
Since then, the borough council has been putting together its strategy on how to recoup the sums. But the discussions are taking place in private, with an item on Wednesday’s cabinet meeting (March 13) being exempt from the public and press.
The Local Democracy Reporting Service challenged the exemption and argued that the public interest now outweighed the interest in maintaining the exemption.
But after considering the request, the cabinet agreed to keep the agenda item private as the council didn’t want to let ‘the other side’ know their strategy.
Borough solicitor Francis Fernandes, referring to the challenge, said: “They are challenging the exemption and it refers to Schedule 12a of the Local Government Act, which is the correct act. The argument is that it’s in the public interest to have this item held in public.
“They are right on a general matter of principle because of the publicity surrounding this and the interest from members of the public.
“We very rarely go into private session so our approach is very much to have issues considered in public where possible. However, the reason for this being exempt is a very good reason.
“The issue is that I will be giving cabinet an update, however, I am giving this update as a lawyer when we have live litigation issues, and that plays a part.
“We would not want our strategy to go into the public domain and we wouldn’t want to let the other side know what our plans were.
“My conclusion is that, while I do understand why the challenge has been made, I maintain that this should be held in private because of legal issues.
“I haven’t been asked by any member to hold this meeting in private, this is an officer decision based on risk and legalities.”
Council leader Jonathan Nunn added: “This is so important and everyone on the streets is really interested in this. But having heard what’s been said on recovering this money for the taxpayer, I think we should consider this in private.”
The borough council’s own chief finance officer has already stated that the authority is unlikely to recover all the money.
A criminal investigation into the ‘misappropriation’ of the loan money, given to the Cobblers to redevelop Sixfields, is ongoing as Northamptonshire Police says its investigation is 'nearing completion'.
And a recent investigation by the Insolvency Service found that the sole director of the developer that received the bulk of the loan money, Howard Grossman of 1st Land, had ‘blatantly disregarded’ his duties as a director.
The Insolvency Service found that it had ‘not been possible to determine the exact nature of more than £5.6million worth of payments made to various parties from 1st Land’s accounts’.
Mr Grossman, 57, of Bushey, has been banned from running companies for 10 years.