Householders in Lochgelly and Blairhall have welcomed news they will not have to fork out thousands of pounds as a result of Fife housebuilder Lomond Homes going into administration.
Members of Fife Council’s Executive Committee have agreed that the outstanding debts of Lomond Homes will not be passed on to homeowners.
At the executive committee meeting in Fife House on Tuesday, officers presented a report on the legal status of Section 75 agreements. These are used as part of the planning process to make sure the financial contributions required for amenities and local services are paid.
However, because they burden the land, house owners can be held liable for money owed.
There was unanimous support for a motion from executive member Mark Hood, Lochgelly Labour councillor, to agree that, given the circumstances, individual householders should not be held liable for Lomond Homes’ financial obligations.
Mr Hood said: “Lomond Homes repeatedly failed to honour their legal and moral obligations to both the council and the people who bought new homes from them in good faith. And, now that the company is in administration, it’s unlikely we will recover any money from them.
“Council officers worked in good faith with the company in a difficult economic climate and tried to be flexible to support a local business but we all acknowledge that there are lessons to be learned from the way the case was handled.
“The homeowners have been caught up in an extremely stressful situation, through no fault of their own, and we have no intention of adding to this by burdening them with a large bill. I’m delighted that we have been able to confirm this position once and for all.”
Committee members heard that invoices will now be automatically sent to developers as trigger points are reached in building projects and the council will quickly start recovery proceedings, including obtaining interdicts to stop further building if payments are not made promptly.
Fife Council Leader Alex Rowley said: “Developers must understand that we will not allow this situation to happen again. We have changed our planning and financial procedures to make sure obligations will always be met in the future, so that neither the council nor home buyers are ever left high and dry again.”
Fife councillor Ian Chisholm, who is the SNP member for Lochgelly and Cardenden, welcomed the decision.
He said:“Good sense seems to have prevailed and pressure from the residents’ association, with support from myself, seems to have concentrated minds on the immorality of pursuing this dubious claim of more than £4,000 on homeowners.
“The administration are now saying that individual owners should not be held liable in the specific cases in Lochgelly and Blairhall.
“I just wonder why the issue had to go to the extreme lengths of an executive meeting, with the worry that the owners have had to put up with. Given that officers were tardy, at the very least, in pursuing the debt from Lomond Homes, I do believe there would have been a breach of natural justice should the council have taken dubious legal action.”
Ethne Brown, who moved from Stirling with her husband Ian to New Farm Vale in Lochgelly last October, said: “We are obviously very, very pleased councillors agreed unanimously that Lomond Homes’ directors were wrong in what they are doing in relation to Section 75 agreements.
“Also, that they highlighted some inconsistencies with the practice that was going on in the council and an acknowledgement that this was the first time Section 75 payments were not paid. This has set a precedent and we hope lessons have been learned.”