Councillors agree to write-off a £100k debt owed to the local authority

Members of Scottish Borders Council's executive committee agreed a recommendation that a sundry debt of £100,731.45 owed by Beaune Properties Ltd and Beaune Properties North Ltd was "irrecoverable and appropriate for write-off as the debtor is insolvent."

The debt relates to works carried out in Hawick over a seven-year period from October 2008.

The first invoice was a charge of £2,050.04 for the provision of boarding to secure the site at Harriers Hut in Bath Street, Hawick.

There followed a further 24 invoices incurred between 2008 and 2015, amounting to £99,680.71, in relation to stabilising a dangerous building and enforcement works at Wilton Mill, Commercial Road, Hawick.

Councillor Simon Mountford said: "I fully understand that we have got to write this off because we have no alternative. What I don't understand is why when the company was dissolved in 2016 it has taken us six years to write the debt off."

David Robertson, the council's director of finance and corporate governance, responded: "It has purely been a workload issue, there has also been a change of personnel within the team who were dealing with this. The person who was dealing this and should have brought this forward has now retired. We're now bringing this forward with apologies for lateness."

Councillor George Turnbull said: "Are we still tracking those involved with this company? Have they been involved and created new companies and are the council protected against any future projects?"

Mr Roberson said: "We know exactly who the directors of the company were. My understanding is that at least one of the individuals is still active in the Borders in business in a variety of enterprises and we are keeping are eyes on the situation in terms of the council's future involvement with the directors of these companies."

Councillor Hamilton asked: "How do we ensure that this doesn't happen again?"

Mr Robertson responded: "This is a unique set of circumstances and the first time in over ten years I have brought one of these reports to you for a specific write-off and this has been a long-running and very difficult experience for the council, involving court action and mediation and the dissolution of these companies. We could only seek to monitor these people that we are dealing with here. The debt was very much incurred because we had to step in on public safety grounds when the mill and in particular the clock tower associated with it became dangerous."

Council leader Mark Rowley sought and was given reassurance that there were no similar debts "in the cupboard" - due to more robust measures now being in place.

In his report to the committee Mr Robertson says: "Court proceedings were raised against Beaune Properties in 2010/11. These proceedings were defended by the company and with a view to avoid going to full evidential hearing the court asked both parties to go to mediation.

"Mediation took pace in 2012 where a qualified mediator oversaw the meeting. The meeting was attended by senior officers from Scottish Borders Council and representatives of Beaune Properties. The outcome was for Beaune Properties to pay SBC the sum of £40,000 in full and final settlement of all sums due with an agreement drawn up in the names of Beaune Properties Ltd and Beaune Properties North Limited.

"Despite entering into mediation agreement Beaune Properties North Limited failed to make the agreed payment of £40,000. All correspondence seeking payment of the sum were met with a response asking for further time to pay and then wanting to enter into further discussion on the amount that was agreed to be paid.

"No payment was received from Beaune Properties North Ltd and they were dissolved in August 2016."