The Prince of Wales was accused of grossly exceeding his constitutional powers after a High Court judge criticised him yesterday for an "unexpected and unwelcome" intervention in a high-profile £3bn property development which was then withdrawn by its billionaire Qatari backers.
The heir to the throne waged a two-month campaign to persuade Qatari Diar, a hugely wealthy property investment company owned by the Qatari royal family, to scrap the modernist scheme drawn up by the architect Lord Richard Rogers to redevelop Chelsea Barracks in central London. Prince Charles said his "heart sank" when he first saw the proposals.
Mr Justice Vos, sitting at the Royal Courts of Justice, ruled that Qatari Diar breached its contract with the millionaire developer Christian Candy when it withdrew its planning application for the 12.8-acre site last June. This followed a face-to-face meeting between Qatar's ruler, Emir Sheikh Hamad bin Khalifa al Thani, and Charles at Clarence House.
But the judge ruled that CPC Group, the company owned by Monaco-based Mr Candy which was Qatari Diar's partner in the scheme, was not entitled to a payment of £81m set out in the contract, finding that the Middle Eastern company had been left "between a rock and a hard place" following Prince Charles's complaints.
Lawyers for CPC Group argued that the project for the £1bn site foundered as a direct result of the Prince's decision to voice his disapproval of the "Brutalist" plans, which were taken off the table days before they were due to be considered by planners at Westminster City Council. Qatari Diar said the decision was taken due to planning concerns.
Last night, constitutional reform campaigners and the body representing architects attacked Charles for meddling in the democratic process and using "inappropriate behind-the-scenes methods" to kill off the complex drawn up by Lord Rogers, a long-standing target for the Prince's complaints about the lack of "traditional values" in modern architecture.
Graham Smith, campaign manager for Republic, which calls for an elected head of state, said the case raised wider questions about Charles. He said: "It is quite clear that the Prince is using his position to sway matters of public policy by approaching parties outside the democratic process. How many other government decisions are being influenced by the Prince's behind-closed-doors lobbying?
"Prince Charles must be made accountable for what he is doing. If it was not for a legal dispute between two private companies, we would never have known the full details of this case. Clarence House must come clean on what other issues the Prince has been dabbling in because he has to choose whether he is a prince or a politician. He cannot be both."
Ruth Reed, president of the Royal Institute of British Architects, said: "The Prince of Wales is entitled to raise concerns about architecture but we regret that on this occasion he failed to engage with the planning process entirely openly and appropriately. One person in a position of considerable influence in public life should not be able to exert undue influence on democratic decision making."
Lord Rogers said: "The way in which the Prince of Wales intervened in helping to get the original Chelsea Barracks planning application withdrawn was wrong."
The judge found that the Prince's lobbying, which began in March last year with a letter to the Qatari Prime Minister, Sheikh Hamad bin Jassim, calling on him to "reconsider" the plans, instantly complicated the efforts by Qatari Diar and CPC to secure planning permission.
Mr Justice Vos said: "Both Qatari Diar and CPC were faced with a very difficult position once the Prince of Wales intervened in the planning process. His intervention was, no doubt, unexpected and unwelcome."
But although the ruling found that Qatari Diar had been placed in a "very difficult political situation", it stopped short of stating that the proposal was withdrawn on the orders of the Emir and that this was because of the Prince's complaints.
Instead, the judge said that the global chief executive of Qatari Diar, Ghanem Al-Saad, had acted on a conversation with the Emir shortly after his meeting with Charles at Clarence House in which the Qatari ruler made clear he wanted the difficulties created by the Prince's objections resolved.
The judgment does not draw a line under the two-year legal battle between Qatari Diar and CPC Group. Mr Justice Vos said he would have been prepared to award damages against Qatari Diar while Neil Kitchener QC, for CPC, said his client would be seeking costs. Mr Candy said he was "very happy" with the ruling.
A spokesman for Prince Charles said: "He has every right to express an opinion privately, which he does with passion, because he cares. Now to whomever he expresses that opinion, they have the right to decide whether to pay attention to it or not."
Brothers with a gift for property
Their list of assets includes a helicopter, a fleet of fast cars, a £150m home in Monaco and a £60m yacht. Christian and Nick Candy have come a long way since 1995, when the two brothers scraped together a £6,000 loan hoping to make a modest return on a one-bedroom flat in central London.
The pair are worth an estimated £450m after 15 years of fast and furious real estate dealing. In the process, they have acquired a circle of celebrity friends and a lifestyle to match. Nick, 37, has been dating the Australian actress Holly Valance and the brothers donated £60,000 to the Conservative Party last year.
Despite recent setbacks caused by the credit crunch, the brothers insist that their finances remain in robust shape. As proof they point to the success of One Hyde Park, their prestige development of flats in Knightsbridge, where a penthouse sold for a world record £150m. According to one report, the anonymous buyer was none other than Sheikh Hamad bin Jassim, the Prime Minister of Qatar and one of their opponents in yesterday's court proceedings.
Royal with £44bn of pocket money
By an accident of geography and the world's thirst for hydrocarbons, the tiny Gulf state of Qatar has been transformed from a desert kingdom reliant on pearl fishing to a major player big-ticket property investments.
The emirate sits on top 26 trillion cubic metres of gas and has amassed a £44bn pot of spending money which it dispenses through its sovereign wealth fund, the Qatar Investment Authority (QIA). Overseen by Qatar's absolute monarch, Emir Sheikh Hamad bin Khalifa al Thani, and managed by his cousin, Sheikh Hamad bin Jassim, the Qatari prime minister, the QIA has built up impressive list of assets.
Along with holdings in Sainsbury's, Barclays and Volkswagen, the emirate bought Harrods to add to the US embassy building in Grosvenor Square and the Chelsea Barracks site. Qatar is now the world's single largest property investor. Prime minister Sheikh Hamad is directly responsible for many of QIA's purchasing decisions. Asked about his PM, the emir is said to have remarked: "I may run this country, but he owns it."