Sunday, 11 October 2015

Manston Airport cpo, the fat lady has started to sing and the tune is oh so Thanet.

As I guess most people know the two main protagonists in this one Thanet Council and RiverOak have just come to the end of the 30 day period of calm negotiations where they both promised regular updates would be published jointly on both their websites.

In the last 24 hours the fat lady has sung two songs.

In one song RiverOak who hoped to be chosen as the council’s indemnity partner, putting up the millions to finance the cpo (the main aspect of this being could the council trust them.) have published the confidential correspondence between them and the council leader Chris Wells on their website.

Here is what they have published:

From: cllr-Chris Wells [mailto:cllr-Chris.Wells@THANET.GOV.UK]
Sent: Wednesday, October 07, 2015 6:34 PM
To: George Yerrall
Subject: Liabilities outline as discussed

Hi George

I have tried to lay out the risks we feel we are likely to carry under your current proposals.  Hope it makes sense and you can explain how and where we can be sure you can cover these risks.

In parallel with the CPO process the Council has to seek to acquire the land by negotiation, and if the owners agree to sell before confirmation, the Council need to be assured that the money will be available if required to buy the land before the confirmation of the CPO.

Alternatively, in order to test the resourcing of this CPO, the landowners might tactically offer to sell the land (with no intention of selling it) and if we had no resources at that stage, then the objectors/landowners could use this as evidence in support of an argument that the CPO process was not properly financially resourced and cast doubt on the financial viability of the Scheme as a whole.
There may be persons with an interest in the land who can serve a blight notice requiring the Council to buy their interests in the land before the confirmation of the CPO, again, funding needs to be in place for this.

The identity of the contracting party who will be signing the Indemnity Agreement has yet to be confirmed. If that (yet to be confirmed) indemnity partner were to fold prior to the confirmation of the CPO, the Council would be left with the funding shortfall.
RiverOak are not themselves funding the scheme but are instead relying on  external private  investors to fund the scheme after the confirmation of the CPO. Given the lack of certainty over the funding then a bond/surety is a sensible way to proceed.

The potential private investors are not known to the Council and they have themselves not provided any contractual commitment to funding the land acquisition and delivery of the scheme. A willingness by Riveroak/its investors to provide monies to put in place a Bond provides a further level of reassurance to the Council that Riveroak and its investors are committed to the Scheme.

The confirmation of the CPO may be up to two years away and the potential investors and the appetite for investment may have changed by then.

The CPO Circular says that the Council in justifying its proposals must show that all necessary resources are likely to be available to achieve the end use. Where details on resources cannot be finalised, the Council must identify how any shortfalls might be met. The Council require a bond/surety to cover any such shortfalls.

RiverOak responds to Cllr Chris Wells
Oct 10, 2015 | Media statement

Dear Chris,

I have received your emails of October 7th.
I am disappointed and distressed because your response leaves me with the clear message that you have no interest in doing a CPO with RiverOak in your role as the Leader of TDC.

I find your list of eight issues to be completely without merit and nothing more than another attempt to inexplicably throw one road block after another in front of us in order for you to carry out whatever your real agenda might be.  Whatever it is, that agenda does not appear to recognize the will of your constituents, which is that Manston Airport be opened and operating at the earliest possible moment.  I need not remind you that the Airport has been closed for a year and half, during which time the community, whom you represent, has seen an asset (and national treasure) produce absolutely nothing of value and, in fact, it has been systematically disassembled and stripped.  As to your specific eight points, I have spoken to my solicitor and have written my point-by-point responses below.

Point 1)  That in parallel with the CPO process the Council has to seek to acquire the land by negotiation and the Council needs to be assured the money is available.
As you are aware this statement is nonsense. You have been made aware that repeated attempts were made by RiverOak to acquire that Airport from its multiple owners.  Theses attempts were unconditionally refused and since that time the Airport has been stripped of assets.

Point 2) That the owners would now offer to sell the Airport (without as you say “not really intending to sell it”) to test whether the CPO process was properly resourced.
This point is also nonsense.  If the current owners wish to sell the Airport at appropriate value we are happy to entertain that offer, but the theory that they will offer to sell but “not really sell it” as some type of strategy is a statement that requires no further elaboration by me.

Point 3) That there may be someone that can serve a Blight notice on the Airport requiring immediate capital.
Given that the Airport is completely uninhabited and closed the whole “blight” concern (which I would point out has never been raised before) is completely specious and irrelevant.

Point 4) You query as to who the contracting party would be for the CPO.
We have repeatedly and exhaustively answered this question.  We will not yet again pretend that this issue has not be examined and satisfied.

Point 5 – 6 and 8)  You are concerned that there may be 3rd party investors participating with RiverOak and therefore feel the need to have a bond in place.
The Airport is an exciting investment and the concept that we have numerous outside parties expressing interest should make you feel more confident, not less, about the ultimate success of the project.  One would think that the community would welcome all sorts of investors many of whom will bring capital and jobs. When you and I spoke of my partners recent trip to Paris to further progress our joint venture discussions on a major portion of our business plan, your dismissive tone to me on the phone about this was telling.  You don’t seem to be even remotely focused on inward capital expenditure and the chance to generate 400+ jobs associated with this singular facet of our business plan.

We nor our counsel are aware of other CPO’s where bonds were provided in circumstances analogous to this one.   We want to be perfectly clear, as we have in the past, we will not provide a bond.  It is neither economically nor commercially viable to do so and is absolutely not required by the governing law.  We know your counsel is well aware of this.  As a result I can only suggest to you that this issue is one you have drawn from thin air in an attempt to thwart the CPO process.
Point 7) You have a concern that given the potential length of the CPO process investors may lose interest.

The CPO process is a well-traveled and regulated path and both we and our investors are quite familiar and understand them.  Every single CPO carries those risks.  Given that we will be expending considerable sums during the CPO process we would not embark on this path and spend our own capital if we were not fully prepared for it. The point is a total red herring.
In addition, as you are well aware, the analysis you sent to me from KCC Legal (whom you originally intended on using as counsel) outlined their fundamental agreement of our original Indemnity Agreement.  You had expressed to us that KCC had excellent experience in this field and that you were very comfortable with KCC Legal being counsel on this matter.  Needless to say, when Sharpe Pritchard were introduced as your counsel, we were surprised.

In your email exchange with from Wednesday night you stated “…and let’s get one thing straight. However many cllrs jump up and down about it, if any decision goes forward against legal and officer advice any CPO is fatally doomed before it starts.”  The explicit threat in that statement is clear. I am no longer willing to jump through hoops based on “advice” from officers who are clearly inexperienced in CPO practice.

What I don’t understand is this.  You were elected on an extremely strong mandate to launch a CPO with RiverOak and you claimed before you were elected that you had reviewed the Indemnity Agreement and had no basic issues with it.  Here we are, six months later and you send me what amounts to a legal opinion, under your own signature, that is filled with factual inaccuracies and irrelevancies that attempt to rewind the process back to zero in the name of “progress”.  What I had asked you on the phone earlier this week was for you to explain to me, in plain English, what the financial risk to TDC was, if for some reason, after putting up all the money and winning the CPO, RiverOak were to walk away.  You never answered that question because the answer is that there isn’t any.

I’ve told you on numerous occasions that all I wanted was to get a deal done with you that would indemnify you against the costs of the CPO.  I hired an excellent firm and a specialist within that firm to advise me and have produced an agreement, the guts of which have been successfully used time and again in partnering CPO agreements in the UK.  Everything we have received from TDC since you decided not to use KCC Legal as your counsel attempts to obscure and confuse that fact.  And that is why I am convinced that you have no interest in partnering with RiverOak as an Indemnity Partner on a CPO.

Your public response to this email will undoubtedly be some form of “the great care being taken to ensure that Thanet has no risk” and/or that “RiverOak has not been able meet the strict requirements that you have set forth on Thanet’s behalf”.  You are, of course, entitled to try to influence the voters in any way that you choose.  If we weren’t sure of the legal ground we stand on and sure of our ability to be successful in a CPO then we would not be here.

We’re still here and we are ready to execute our Indemnity Agreement, immediately.  We hope to move forward in a more open and transparent process.
Thirty days have come and gone. The only “progress” we have made is that we are now certain that you have no interest in a CPO.

We will be posting this email thread on our web site by day’s end.

George Yerrall”

The other song relates to the Managing Director of RiverOak Tony Freudmann, I have copied this next bit from The Manston Pickle facebook page although it’s all over the internet today in different shapes and forms.

"It would seem that a story is doing the rounds to the effect that Anthony Freudmann's striking from the 'roll of solicitors' was the result of having 'fallen on his sword' having covered for his colleagues. 

This pickle has spoken to the current senior partner of the firm and can confirm that this is palpable nonsense. In fact so incensed were his co-partners on discovering his deeds, that having called him into the office to confront him, they let the tyres down on his company car, something Freudmann made much of before the Solicitors Disciplinary Tribunal. The Solicitors Disciplinary Tribunal also fell for his charms and dealt with his case with ridiculous leniency. The, then, Solicitors Complaints Bureau were not so gullible and appealed the case to the High Court. Lord Justice Taylor allowed the SCB appeal and on the basis that Mr Freudmann's deeds were so serious that he was not a fit and proper person to practice law and should not be trusted to have access to client funds in the future, struck him from the roll. For the doubters please find attached the original SDT judgement. In fact far from falling on his sword, when he was dismissed from the firm, he tried to continue with his judicial duties as a Deputy District Judge. It was only when the firm advised the Lord Chancellors Department why Freudmann was dismissed and that the matter was in the hands of the Complaints Bureau, that he was suspended by them. Similarly he sought agency work with the Crown Prosecution Service and they were similarly alerted by the firm. At this time Freudmann was also Leader of Shropshire County Council with a budget of £2 million under this control. Again it was not until the County Solicitor got wind of the 'problems' that he resigned from the council. Give this man his due, he tells a good yarn! For those inclined to believe the nonsense spouted by this man, I will happily forward a copy of the original SDT Judgement. As it is in PDF format, I am seemingly unable to post it here."

The pictures below are of some of the supporting documents, they should expand if clicked on the sequence may be a bit jumbled as it is sunday and I have used my Raspberry phone to publish the post.


  1. The whole thing has become farcical and embarrassing. So many people have played politics with it that the truth has been obscured. It's high time the truth was told. The CPO is a non-starter, irrespective of how many people want it or how much they want it. Councillors who can't accept this will need to resign so that we can move on.

  2. The Fat Lady didn't get a chance to sing, the opera was canceled the day Ann Gloag announced the sale of 80% of the site to the owners of the Discovery Park.
    Ever since then it has been abundantly clear that a CPO would never reach a successful outcome.
    Now, the question you have to ask yourself is why, when it has been so clear a CPO wouldn't be possible, the main political parties have been so united in the pursuit of something that will never be.
    My take, and I know it sounds a little far fetched, is that all the political parties have known for a long time Manston was failing and that it would be a prime target for development, how would the council stop an unfavorable development from happening? Well maybe by having a cross party agreement for a CPO on the site and force the developers into submitting plans to counter the CPO threat, as we have seen from the Discovery Park team, the plans they have proposed are clearly with a CPO threat in mind.
    What will TDC do now after finding RiverOak are as bad as Ann Gloag said they were? Will they stop looking for a indemnity partner and stop trying to CPO the site or will they reopen their tender for another partner to come forward to keep the developers on track, would another company be so stupid? would the pro-aviation supporters continue to waste their time and money on such a futile cause?
    We will have to wait and see what happens, as TDC can't continue with the RiverOak farce.
    Will the pro and anti airport supporters join forces to ensure something great it built on the site?
    It's clear if TDC end a CPO threat tomorrow this story will not be over for a long time yet.


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