UNIPA News| London|30 June-The Court of Appeal has dismissed claims that public loans worth £140 million provided by the Greater Manchester Combined Authority (GMCA) for two major Manchester skyscraper developments were issued unlawfully, ruling there was no error of law in the authority’s decision-making process.

The judgment, handed down on June 29 following a hearing on June 9 and 10, marks the latest development in a long-running legal dispute between the GMCA and Manchester city centre landowner Aubrey Weis.

The case centred on loans granted to special purpose vehicles (SPVs) owned by developer Daren Whitaker, who operates under the Renaker brand. The funding supported the Trinity Islands and New Jackson high-rise developments in Manchester city centre.

Lawyers representing Weis Group argued that the loans had been provided on excessively favourable commercial terms. They told the court the financing carried a base interest rate of 5.65 percent with an additional one percent margin, contending that the margin should instead have been four percent to reflect market conditions.

The appeal also alleged that the GMCA had failed to carry out sufficient due diligence into Whitaker’s financial position and creditworthiness before approving the loans. It further claimed that documentation relating to the proposed interest rate was prepared after the funding decision had already been made.

The GMCA rejected those allegations, maintaining that the loans were subject to a comprehensive due diligence process and had been approved on commercial terms rather than as a public subsidy.

In its ruling, the Court of Appeal upheld an earlier decision by the Competition Appeal Tribunal, which had also found in favour of the GMCA.

Delivering the judgment, Lord Justice Zacaroli, with the agreement of Lord Justice Nugee and Lord Justice Miles, said the key issue was whether the GMCA had erred in law in concluding that the loans did not constitute a subsidy. The court found no legal error in that assessment.

Following the ruling, a GMCA spokesperson said the judgment confirmed the tribunal’s earlier finding that the loans had been made on commercial terms and rejected claims that developers had received favourable treatment. The authority added that its Housing Investment Loan Fund had contributed to the delivery of around 11,000 new homes while generating returns to support housing initiatives across Greater Manchester.

However, the Court of Appeal also stated that the GMCA should have considered official subsidy control guidance when assessing the loans. The judgment further noted there were “well-founded criticisms” regarding the absence of a personal guarantee from Daren Whitaker and the lack of due diligence into his overall financial position.

Responding to the decision, a Weis Group spokesperson said the company was disappointed that the appeal had been dismissed but argued that the judgment highlighted significant concerns over how the GMCA had managed more than £1 billion of public funds. The spokesperson said the company was reviewing the ruling with its legal advisers and was considering further legal options, including seeking permission to appeal to the Supreme Court.