COVENTRY taxpayers face a seven-figure compensation payout after a damning ombudsman ruling concerning a council ‘witch hunt’ against a charitable company which supports disabled people.
As revealed in the Coventry Observer, the Local Government Ombudsman two years ago accepted Coventry housing company Open Doors’ claims, in finding the council had conducted a long ‘unreasonable campaign’ against the not-for-profit firm.
Ombudsman Dr Jane Martin – who investigates complaints against councils – delivered a rare finding of ‘maladministration with injustice’ and ordered Coventry City Council to apologise for conducting multiple inappropriate investigations. Martin Reeves formally apologised in writing as the council’s chief executive, accepting the charity had been mistreated.
Now a High Court court judge has thrown out a ‘costs order’ application by the council concerning the terms of any payment of the council’s legal costs by Open Doors, should the housing firm lose its case for damages at a later hearing.
Judge Davison dismissed the council’s application that the housing firm should pay £75,000 as security against costs to the court in advance, based on a mistaken assertion that the company might not be able to meet the costs.
He added such a costs order would be ‘undesirable’ given the company’s ‘duties’, including to its vulnerable clients.
Open Doors’ barrister, Gideon Roseman, also told the court in London last Thursday (July 7) the application was a ‘veiled attempt’ to ‘oppressively stifle a genuine claim’, in other words to apply pressure on the housing firm to drop its claim.
He also claimed the council was in breach of civil court procedure rules by failing to outline its defence beyond single word responses that the allegations were being ‘denied’.
The costs application alone is thought to have cost at least £15,000 of taxpayers’ money alone, amid cuts to jobs and services.
It was revealed in court last week the council could eventually face a compensation bill of £1.5million to Open Doors Housing and Support Limited, based in Far Gosford Street, Coventry city centre.
That is the estimated loss to the business which it states could otherwise have been ‘invested into its important services to the disabled people’.
The housing firm, and its director John Kavanagh, who has lodged an unlimited claim for personal injuries in addition to the company’s compensation claim, allege harassment by the council, unlawful interference in its business, negligence, and Misfeasance in Public Office.
Open Doors claimed it was ostracised after it raised concerns about the council in 2006 at what the housing firm perceived as poor treatment of vulnerable people.
It alleges this escalated into a full blown ‘witch hunt’ in 2009 after the company restructured and increased rents paid via housing benefit.
Several safeguarding investigations by the council – one of several local authorities which had provided grants for the firm to provide services – followed.
The ombudsman ruled the safeguarding investigations were inappropriate and not relevant to the council’s reasonable concerns about the disabled tenants’ escalating debts.
She ruled it was hard to understand why they took place.
The ombudsman ruled the company had nothing to gain from putting its tenants in a position where they could not pay their rents.
The council later accepted they had wrongly restricted Housing Benefit claims, settled them in full, and apologised for delays.
Two previous ombudman’s rulings concerning the organisation had also found against the council.
The council said last year it had implemented the Local Government Ombudsman’s recommendations.
As we reported, Open Doors director John Kavanagh last year accused the council of a cover-up in failing to adequately address the issues in public – in councillors’ scrutiny meetings and public documents, including an annual safeguarding report.
Mr Kavanagh said of the costs application: “This was a disgraceful attempt without any justification by the city council to further distress an organisation who support some of the most vulnerable people in the city.
“After the Ombudsman’s ruling, Chief Executive Reeves promised that the council would learn from the outcome of the Investigation, it seems they never do.
“It is pertinent that at the same time that the council were throwing unlimited resources in pursuing a witch hunt against an organisation described as exemplary by a neighbouring authority, they were neglecting their genuine safeguarding duties which were desperately required in other areas such as the tragic death of child Daniel Pelka and, as reported this week, several vulnerable children in Coventry.”
A council spokesperson said: “This is an ongoing claim and it would not be suitable to comment at this stage.”