Taxpayers’ £4m bill over failed court case

Teesworks and corporation face costs in port access row

THE taxpayer could pay more than £4m as a High Court judge ordered South Tees Development Corporation and Teesworks Ltd (STDC) to pay a port company’s legal costs after they brought unsuccessful litigation over land access rights.

A hearing was held at the High Court on Wednesday to decide on costs after Mr Justice Rajah determined in February that Teesport operator PD Ports had successfully argued they had access rights across three routes at the former Redcar steelworks site.

The judge ruled that STDC, which is chaired by Tees Mayor Ben Houchen, and Teesworks Ltd were liable to pay 80 per cent of the port company’s legal costs incurred before September 21, 2023 – two weeks before the trial to determine the rights of access began – and all of PD Ports’ costs thereafter.

Final costs will be determined at a later date, however PD Ports’ costs stand at £2.1m subject to assessment. Board papers from February show STDC has so far spent £3.1m on the failed action.

STDC brought legal action against PD Ports in March 2021 to determine whether or not the port operator had rights across former steelworks land the development corporation had acquired the year previously. Teesworks Ltd, run by joint venture partners Chris Musgrave and Martin Corney, were added as a third party to the case after they purchased remediated land that was subject to the litigation in December 2022.

Crucial to the judge’s ruling was an offer made by PD Ports to the claimants two weeks before the beginning of the trial, in which Mr Justice Rajah said they offered to “compromise all claims”. They dropped their claim to access across one of the routes, on the South Bank area of the Teesworks site, and offered for each party to pay all their own costs as long as they retained access across the other two routes.

Andrew Walker KC, representing PD Ports, said: “If this offer had been accepted, there wouldn’t be a need for the trial.”

The outcome of the trial, which provided PD Ports access to all three of those routes, had “substantially beaten that offer”, according to the judge. Had it been accepted, “significant costs would have been avoided”, Mr Justice Rajah said.

It was for this reason that he ruled PD Ports were to be awarded 100 per cent of costs they incurred from September 21, the date their offer was “rejected out of hand” by the litigants.

Mr Justice Rajah discounted 10 per cent of PD Ports’ legal costs for both STDC and Teesworks Ltd to reflect the fact work had gone into building a case against a large number of other claims of access made by the port company which they dropped before the trial began.

Zoe Barton KC, representing STDC, said they would accept the ruling on costs, however Katharine Holland KC indicated Teesworks Ltd would launch an appeal.