Thurrock Council issues claim against businessman Liam Kavanagh and his firm

Thurrock Council says it has begun High Court proceedings against businessman Liam Kavanagh

A council has made a High Court "fraud" claim against a businessman and a firm he ran.

Thurrock Council was left with debts of more than £1bn after a series of investments largely in solar farms.

A council spokesman said proceedings had been issued against Liam Kavanagh and Rockfire Capital.

The BBC has tried to contact Mr Kavanagh, and law firms that may be representing him, but had no response.

Court files show that "Thurrock Borough Council" has made a "commercial fraud" claim in the Commercial Court - part of the High Court.

Thurrock Council has been listed as the claimant and Liam James Kavanagh and Rockfire Capital Ltd as the defendants.

"The council can confirm that it has issued proceedings in the High Court against Liam Kavanagh and Rockfire Capital," the council spokesman told the BBC.

"We are unable to say more at this stage but will provide further information when we are able to do so."

'Inspection'

Detail of Thurrock Council's financial problems were outlined in a government-commissioned report, published in June 2023.

The Department for Levelling Up, Housing and Communities explained how Thurrock Council had incurred an "exceptional level of external borrowing" and was one of the most "indebted" of all local authorities.

Officials said at the end of June 2022 the council's "total external borrowing" was about £1.5bn.

The department had asked Essex County Council to write a best value inspection and produce recommendations.

Gareth Davies, a reporter from the Bureau of Investigative Journalism who investigated the council's spending, was interviewed as part of the inspection.

'Serious issues'

A council finance director had been given "unlimited authority to invest in anything he felt fit", an inspection report said.

The authority had lost "substantial sums of public money" because of systemic weaknesses and a "dereliction" in leadership, it added.

The report said the council's "unique investment strategy" could be traced back to May 2016, when it invested £24m in a solar farm in Swindon operated by Rockfire/Toucan.

Tony McArdle, the report's lead author, said "serious issues" had been raised by July 2021 when £655m had been lent solely to Rockfire/Toucan for solar farm investments.

Thurrock Council was left with debts of more than £1bn

Detail of Mr Kavanagh's links to Rockfire/Toucan were outlined in a ruling by a High Court judge three years ago, after Mr Kavanagh became involved in separate litigation.

Toucan had sued a contractor that designed and built solar parks.

Lawyers representing Toucan argued that, "by reason of" contract breaches, the solar parks contained "defects".

The contractor had counterclaimed and made separate complaints relating to another contract.

Mr Justice Henshaw reached a number of conclusions - some in favour of Toucan and some in favour of the contractor.

The judge said in his ruling - which was published online - that Toucan Energy and Toucan Gen Co formed part of a group of companies "ultimately owned by Mr Liam Kavanagh".

He said the group also included Rockfire Capital.

Hearings in the Commercial Court - part of the High Court - are normally staged in at the Rolls Building in London

Thurrock Council said in late January that it had taken an "important step" on the road to financial recovery.

A spokesman said, in a statement, that Toucan Energy Holdings had entered administration in November 2022.

The spokesman said Thurrock Council had been Toucan Energy Holdings' primary creditor.

He said Toucan's portfolio of 53 solar farms had been sold for about £700m.

"This marks an extremely important step in our financial recovery," added Graham Snell, the council's cabinet member for finance.

"The sale of these assets, and the income we will receive as a result, will allow us to pay down a significant proportion of our debt."