£100m Cancellation Fee for the ACC/Muse contract
7.1 How is the £100m penalty/termination cost of cancellation of the contract, as mentioned by Willie Young, calculated?
7.2 Why have we not seen the contract yet Willie Young is able to tweet and disclose details of the contract. Has ACC/Muse authorised him to disclose?
7.3 Is the £100m penalty contingent upon the ownership of the land resting with ACC (i.e. prior to being transferred to Muse)?
There is no penalty or cancellation clause in the contract however as the council has previously stated there would be a loss in income of approximately £100million if the project were not to proceed. In addition, the Council would almost certainly have to pay damages arising from breach of contract. As is standard practice in the public sector such contracts are commercially sensitive and are not published.
7.4 Under planning legislation, ACC can cancel the contract. What is the cost of contract cancellation and how is it calculated? [Loss of profit should not be included.]
The transaction is a commercial transaction. The Council is not aware of any such planning legislation that could allow the cancellation of the contract.