The former occupant of knitwear firm Judane’s large factory in Lerwick is calling for a full inquiry into how the company has been able to walk away without settling £400,000 of debts owed to the public purse.
Chris Hodge, a budget salesman who was bankrupted by the whole affair, said he was “flabbergasted” that Judane had been able to get off so lightly.
Last week The Shetland Times revealed that the SIC had agreed to settle for around a third of the £600,000 it was owed by the company relating to two separate loans because of the spectre of legal action by Judane over bad planning advice it had received back in 2005.
The planning department had advised that a change of use application for the building would not be required, before changing its mind when Judane was on the verge of selling the factory to Mr Hodge.
Mr Hodge said he was mystified because his lawyers had been informed that he would not be able to pursue a legal claim against the council for the losses he suffered as a result of not being able to go ahead with the purchase.
“I can’t comprehend in any way how the hell they can justify that,” he told The Shetland Times. “They [the SIC] made me bankrupt, made me lose everything. The Millers lift the assets and walk away with the lot. I’m really flabbergasted by the whole idea – words fail me.”
Shetland West councillor Gary Robinson has also called for a full enquiry into the matter.
Mr Hodge said last week’s revelations suggested that his own insurance claim, for around £800,000, against the council should now surely be able to proceed, though he does not expect to be able to raise enough money to fund the legal support required to press ahead. He is particularly annoyed having spent what he estimates to be around £500,000 on improvements to the building.
“My claim against the council should stand and be settled. What exactly was the loss they [the Millers] had? They kept the building. I make it to be a saving, not a loss. I spent the money, did the improvements to the building for retailing – what exactly did they lose?”
He has also provided copies of receipts for rent payments totalling £21,530 which he made for the building between January and November 2007. They were paid to an account held by Caroline Miller as a sole trader of Northern Isles Knitwear, whereas most of the other payments he made for rent of the factory were to Judane (Shetland) Ltd. Towards the end of his tenancy, Mr Hodge had ceased making his £5,000 a month rent payments to the Millers before he eventually vacated the premises last December.
Mr Hodge raised the matter of making payments to Northern Isles Knitwear with the council but said it refused to respond. “They did not want to know when I mentioned the fact that she was [receiving] the money. I was advised there was no impropriety whatsoever. They wouldn’t give me a proper answer.”
He continued: “A lot of the money was paid directly to Caroline Miller – the councillor who claims she has nothing to do with it. I don’t see how they couldn’t be asked to hand over that money to pay off some of their loans.”
In an email to Mr Hodge on 16th June 2008, Mrs Miller stated that if Mr Hodge or his representatives “have an issue with payments made to Northern Isles Knitwear” they should contact her solicitor and accountant, both of whom also acted on behalf of Judane (Shetland) Ltd.
The Millers have still not responded to enquiries from The Shetland Times. Shetland Islands Council has yet to make any public comment on the matter after councillors reached their decision to effectively write off the £400,000 behind closed doors last Wednesday.