Legal proceedings after developer misses deadline to complete purchase of Knowle in Sidmouth

East Devon District Council has confirmed that the sale of Knowle, its former Sidmouth offices, has been delayed. A developer has failed to complete the purchase by the agreed contract date, which was yesterday (December 18).

Lifestory Group Limited (also known as PegasusLife Ltd) was recently in contact with the council seeking an extension rather than meet the existing contracted obligation to pay the outstanding total, says the council.

However, the company has confirmed to it is committed to meeting its obligations and expects to complete the purchase in the New Year.

According to the council, the company said it believes it can complete following external legal advice. The council has resolved to protect its position which means it will commence legal proceedings to secure the agreed and contracted £9m payment as well as any associated costs and damages.

The council says it considers this a necessary and appropriate step as ‘it has an over-riding responsibility to protect the public purse’.

In a statement Mark Dickinson, Chief Executive Officer of PegasusLife, said: “PegasusLife remains committed to meeting our obligations regarding the purchase of the site at the Knowle, Sidmouth.

“Unfortunately, due to the need to secure funding from alternative sources we have been unable to meet the 18th December sale and purchase completion date.

“We believe we will be in a position to do so by 14th January 2020. This position has been shared with the council over the past couple of months, we hope to be able to continue to work in a positive manner with the council, completing the sale of the site in the early New Year.”

Councillor Ben Ingham, Leader of the council, said: “It is deeply disappointing and surprising that a developer such as Lifestory Group Limited should seek an extension of this nature.

“The council has taken expert legal advice which has confirmed the strength of the council’s position and remains confident that it will secure the £9m sale price plus associated costs and damages.”

There is no immediate impact on council finances for this financial year, the council has confirmed.  As legal proceedings can take time the council will consider the position again if Lifestory does not settle the matter early in the New Year.

In the meantime the council will continue to maintain security and other arrangements on the Knowle site.

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