A multi-million pound dispute centering on a property deal in Reading has reached the High Court, as Russian millionaire Pavel Lisitsin attempts to sue a group of individuals, including the aristocratic Honourable Charles Balfour (heir to the Earl of Balfour).
It has further emerged that, according to
the Telegraph
, former Conservative Minister and QC David Mellor was also named in court as being caught up in the development land purchase in question. The deal, which faces allegations of fraud and misrepresentation, involved the acquisition of land from housebuilder Hicks Persimmon. According to claims made in court, Mr Mellor was paid a consultancy fee of £500,000 after helping to push the deal through.Mr Mellor’s business partner Mr Maggs, who was allegedly paid £1 million for his part in the deal, said in court: “He [Mr Mellor] was actually very crucial. In fact, he was probably the most crucial person in the finish of the transaction and actually getting the transaction over the line,” the
Telegraph reports
.The Russian millionaire is suing the defendants, including Wharf Land Investments – Mr Mellor is a director and 50 per cent shareholder – after investing £2 million in Sandford Farm on the understanding that this money would be used to buy the land for £12.3 million. However, the land was actually purchased for £9.3 million before being sold on to Mr Lisitsin and others for the increased price. It is this £3 million profit that has led to the court battle.
Mr Lisistin claims that he was not told about this extra money, and lost his own money after the company which owned the land went into administration.
With Mr Lisitsin no longer an investor in the land, half of it was subsequently sold to a property developer, earning a net profit of £8.2 million.
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