Development corporation faces pounds 2.8m writ: Lawsuit lashes Mersey marina

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A LEGAL BATTLE has erupted over the bankruptcy of the marina at the heart of Michael Heseltine's scheme to revive the Mersey waterfront.

Ten years of alleged mismanagement are charted in a damning 'dossier of failure' on the rescue of Liverpool. Private developers have served a pounds 2.8m writ on the Merseyside Development Corporation, alleging the government quango has mismanaged vast tracts of dockside development land and that its senior executives have been misleading journalists and developers for eight years.

The dossier lists a string of project failures, all sponsored by the Corporation, which stands accused of attracting virtually no significant private investment to 2.5 miles of quays in the city's South Docks.

Land around the Kings, Queens, Coburg and Brunswick Docks - which under Heseltine schemes cost the taxpayer pounds 100,000 an acre to clear of dereliction - is still worth no more than pounds 50,000 an acre, according to an MDC statement.

The fierce legal battle is being waged between the Corporation and South Quays Marina, the parent company of Liverpool Yacht Harbour. It could seriously embarrass Sir Desmond Pitcher, part-time chairman of the MDC and pounds 365,000-a-year chairman of North West Water. He is a former chief executive of the Littlewoods pools and retailing group, which gave pounds 160,450 to the Conservative Party between 1990 and 1992.

Liverpool is about to be granted another pounds 1.5bn slice of taxpayers' money, after winning a fight for Objective One funding from the European Union.

For the second time in five years, the EU has been persuaded to try to beat the structural decline in Liverpool with a cash injection to attract private investors. Between 1989 and 1993, the city received pounds 400m under Objective Two.

Sir Desmond is still president of the Liverpool Marina Yacht Club, despite the fact that the MDC has been trying to close down the operating company, which was put into administration by its own directors last winter when MDC, chaired by Sir Desmond, started rent arrears proceedings.

A 52ft twin-screw diesel motor yacht, the Samsoon, which was owned by Sir Desmond and sailed back from Spain on his orders, still rides at her berth by the clubhouse, but has now been sold.

The MDC is seeking legal powers to seize the marina from its administrator, Alan Sutton.

A bid by Bill Mullarkey, an electronics engineer and marina berth holder, who proposed to inject pounds 500,000 of new money into the Yacht Harbour company, has been stalled.

South Quays Marinas is suing the MDC for pounds 2.8m, claiming that Liverpool Yacht Harbour could not operate profitably - and lost pounds 750,000 in five years - because the Heseltine quango had failed over 10 years to get developers to build on the land around the marina.

The quango, much praised for its brilliant rescue of the Albert Dock, the world's first enclosed dock system, is now accused of 'misrepresentation' and making 'negligent mis-statements'.

Heavy spending and promotional publicity by the MDC has so far failed to attract private developers to the South Docks system.

Lawyers, briefed by Roger Fowler, a former director of the company, have listed more than a dozen failed projects, announced at different times by chairmen and public relations officials for the corporation.

Bob Lane, the MDC's assistant chief executive, said last week: 'We are contesting this writ very vigorously. I cannot say more than insist that we are confident of our record and that the look of the waterfront area speaks for itself.'

It was Mr Fowler's development of a marina in Manchester Docks, in Britain's first Enterprise Zone, and its inspection by Michael Heseltine on his 1981 visit to the area in the wake of the Toxteth riots, that led to the concept of a new Merseyside yacht marina to kindle the revival of miles of abandoned docklands in Liverpool.

Mr Fowler was a consultant during the planning of the marina, which opened in 1987 and attracted 200 yachts to permanent moorings within earshot of the bells of Giles Gilbert Scott's great Anglican cathedral.

'Everyone involved in the planning knew that the arrival of another 300 yachts in the marina depended on the building of waterside executive homes, which were always part of the plans,' said Mr FowIer.

'But the plans have never been realised. The chosen developers have failed.'

The dossier of failure, prepared for the pounds 2.8m writ, lists projects that the development corporation has at times announced for the empty quays around the marina, often quoting from the Corporation's own publicity material. They include:

A shopping mall, international leisure centre, 10-studio Imax cinema and five-star hotel;

500 residential houses and apartments;

A four-mile continuous landscaped waterfront walkway.

The biggest aquarium and 'shark park' in Europe, involving 'massive pools developed on the Queens Dock site, which was described by potential Japanese backers as the best they had seen,' according to John Ritchie, MDC's chief executive at the time.

A 'Brunswick Harbour Village' of 270 executive homes, to be ready by spring 1991.

A light railway.

Donald Forster, former MDC chairman, is quoted as saying in 1987: 'The next four years should see the whole of Liverpool's South Docks regenerated into a waterfront to rival any in the world. About 430 houses and 210 flats are to be built.'

Despite 10 years of effort by the development corporation, which is due to complete its work in 1997, not one of the projects has come to fruition.

The developer selected for the Brunswick Harbour Village went into receivership in 1993, after pounds 600,000 of taxpayers' money had already been spent on flattening the old grain silos on the site.

The only successful development around the marina has been Mariners Wharf, a group of apartments for rent, built by Wren Properties of Manchester. Malcolm Robinson, its managing director, is also a director of the company suing MDC. Wren's pension fund stands to lose pounds 200,000 that it invested in Liverpool Yacht Harbour in 1989.

Mr Robinson said: 'The MDC has been repeatedly unsuccessful in its task of regenerating the South Docks. The marina company would not have failed if the 400 homes promised by the MDC for Brunswick Dock had been built.

'The MDC are resisting the proposals for a recapitalisation of the business unless they get paid their rent in full.'

All attempts to persuade the MDC to alleviate the marina company's unpaid rent bill, on grounds that the marina's success depends on the construction of planned MDC developments around it, have been refused.

(Photograph omitted)