HNP ENGINEERING has expressed its disappointment after Shetland Charitable Trust (SCT) and its property arm SLAP were ruled to have acted properly when selling land occupied by the Lerwick business.
Charities regular OSCR confirmed this week that trustees and SLAP directors “acted in line with their legal duties” when selling land occupied by HNP on the town’s Commercial Road.
The firm’s building will be demolished before an 80-room student hostel is constructed on the site by Chester-based developers Cityheart.
HNP Engineers, which employs 16 staff, is currently in the process of moving its business to a property at Lerwick’s Lower Staney Hill industrial estate.
In a letter to SCT chief executive Ann Black, OSCR’s head of enforcement Laura Anderson said that trustees acted in a proper manner throughout the sale.
“It appears that the charity trustees and directors of SLAP have acted in line with their legal duties throughout [the sale] process,” she said.
“We note that the charity trustees were kept abreast of developments on a regular basis by SLAP.”
Director Ian Walterson said he was disappointed by OSCR’s ruling and he totally disagreed with the regulator’s findings.
“The problem is that the charity owns SLAP and apparently the trustees of the charity seem to be content to endorse the ruthless and aggressive way with which the company carries out its business,” he said.
“Some of what has gone on recently is morally wrong in my opinion, and there is a lot of concern in the community about how both the charitable trust and SLAP is being run and how it operates.”
The company first complained to OSCR back in February, a couple of months after it went public about its dispute with SLAP to reveal it was set to be evicted from the property.
Trust chairman Bobby Hunter said he was pleased to have OSCR’s approval.
“We strive every day to comply with not only charity law but the exacting standards applied by HMRC and our own auditors,” he said.
The charities regulator, however, did suggest the trust review its wording surrounding making loans or grants in view of “promoting the development” of industries in the community.
“The reality is that there are only very limited circumstances under which ‘promoting directly or indirectly the development of any industry or industries among the community’ could ever be charitable,” OSCR’s Anderson said.
HNP boss Walterson previously said that SLAP knocked back an offer of £330,000 for the site last year.
He went public to suggest that the company would be “destroyed” if it was removed from the property, with its heavy machinery likely to be difficult to move.
SLAP acquired the site in 2004 and shifted HNP’s long-term lease to a year-on-year agreement before putting the land up for sale in 2015.
The site was ultimately sold to Cityheart, which was granted planning permission in June to build student accommodation for the University of the Highlands and Islands.
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