Our Olympics: ‘Chariots of Ire’

Purely for amusement, and to compliment all the remeniscing prompted by the 2012 anniversary, here’s a post that first appeared on this blog in 2015, one of a series on ‘Our Olympics’ (see links for the others).

Who can forget the sight of no less a figure than LBWF CEO Martin Esom scurrying round the borough’s public libraries to collect in as many copies of the council’s Olympic guide to Leyton as he could, lest he and his chums be blamed for the evolving fiasco that was the Leyton Market?

A ‘Gold medal for ineptitude’, indeed.

‘Our Olympics’: (1) LBWF and Leyton Market – the Council wins a ‘gold medal for ineptitude’

In the immediate run-up to the start of the Olympic Games in July 2012, LBWF proudly promoted a ‘new international food market’ in Marshall Street, adjacent to Leyton underground station, and, more important, metaphorically ‘just a stone’s throw away from the Olympic stadium’. In a press release, Cabinet Member for Economic Development and Corporate Resources, Cllr. Mark Rusling, enthused: ‘This is a great opportunity for Waltham Forest to celebrate the Olympics by creating trade for local businesses and offering a diverse selection of international food and drink for residents and visitors to enjoy. We have worked with the whole community – including local retailers – to get their support for this unique project.’ Altogether, 30 hot and cold food stalls were promised, run by local restaurants and café owners, with ‘an assortment of delicious Italian, Caribbean, Indian, German and British food and beverages on sale’.

However, within a few days, the mood had drastically changed. Stallholders complained that that footfall along Marshall St. was non-existent, and they were losing money hand over fist. Soon, the situation had deteriorated further. In early August, the Waltham Forest Guardian reported that only a ‘handful of traders’ were still clinging on, opening for limited hours during the morning and evening, while the majority appeared to have decamped, even though all were contracted to operate continually until the end of the Paralympic Games in September. According to another report, the experience of stallholder Nameem Akhtar was typical: ‘Having spent £23,000 on rent, stock and equipment for a Thai food stall, by 7 August Akhtar had had enough and packed up, his stall having failed to sell a single meal’ (Private Eye, no. 1321, 24 August 2012). On 21 August, the market was closed for good. Cllr. Rusling’s ‘great opportunity’ had fizzled out, and the talk turned to exactly how such ‘a catastrophe’, as one stallholder described it, had happened.

In its public pronouncements, LBWF had repeatedly claimed to have ‘created’ the market, but it now transpired that this did not mean what most people reasonably assumed. The contract for organisation and management, LBWF explained, had been tendered and then awarded to the sole bidder, a ‘joint venture’ comprising Skateco (UK) Ltd. as the day-to-day operator of the site, alongside North London Business (NLB), the trading name of North London Ltd. (for which see previous posts). So attention quickly turned to exactly how these two organisations had functioned, and in particular what they had promised traders.

This took some untangling. The ‘stallholder pack’ initially circulated was predictably upbeat about the market’s prospects and included the following key statement: ‘Footfall during this period will be significant. With the expansion of Leyton tube station there will be a significant number of visitors throughout the day wishing to gain access from Leyton tube station to the Park and vice versa. Initial estimates indicate that on some days over 40,000 spectators will make their way along this route for the park, which equates to 80,000 when the return journey figures are added’.

The figures quoted appeared genuine, having apparently originated with Transport for London (TFL), and been passed on by LBWF. However, it was also a fact that they had subsequently been modified. For shortly before the Games were due to start, TFL had determined that, because of improvements elsewhere on the underground system, Leyton station would not be recommended as a major gateway to the Olympic Park, nor even would be needed as an ‘overflow’, which inevitably made the predictions about footfall in the area redundant. The problem seemed to be that no one had thought to tell the stallholders.

With these unfortunate facts seeping into the public domain, claim and counter-claim escalated. LBWF was insistent that ‘NLB and their partners Skateco’ were ‘solely responsible for the success of their market’, having ‘won the ability to locate, organise, manage and run the event, receiving income through their contracts with stall holders,’ and thus the problems were for them to resolve. Skateco (UK) Ltd., on the other hand, argued that far from being the villain, it was the victim, with its sole director and shareholder, Brian Jokat, complaining: ‘“The council…told us and other local businesses that in excess of 30,000 people could realistically be expected on some Games days…that there would be a regular flow of visitors to the Olympic Park from nearby Leyton Underground station and that people would be drawn to the market by local signage and council-produced leaflets. All this would have generated significant passing trade for the market and its stalls but, sadly, none of it has been delivered in reality”’ (Waltham Forest Guardian, 9 and 15 August 2012).

In the weeks that followed, negative media comment snowballed. The Jamaica Observer highlighted the despair of some Afro-Caribbean stallholders under the headline ‘“We were robbed” – Olympic dream turns nightmare’, while the Huffington Post ran an in-depth piece on a similar theme (‘Olympic Food Market” Leaves Leyton Traders £25,000 In Debt After Blunders’). An online petition at Change Org., which asserted that the stallholders had been mis-sold pitches and should be given refunds, rapidly attracted 5,621 signatories and coverage on the BBC, feeding into a wider narrative popular in some quarters that the Olympics had been dominated by corporates, with small businesses and long-term residents largely sidelined.

Meanwhile, local press and social media comment threw up further nuggets. Gary Ince, described in press stories about the market as ‘chief executive of North London Business’, in other words North London Ltd, turned out to be company secretary of Skateco (UK) Ltd., as well, plus a recently retired director of North London Ltd, and director of an entirely separate dormant company called, surprisingly, North London Business Ltd. – a somewhat confusing situation to say the least. It appeared, too, that Mr. Jokat’s disappointment with ‘council-produced’ publicity was amply justified. LBWF had spent £4,000 on 70,000 copies of a special Olympic guide to Leyton, true, but this had hardly done the stallholders any great favours. For although the featured map showed the position of the market, the suggested pedestrian route from the underground station to the Olympic Park avoided Marshall Street altogether. Moreover, inquiries revealed that the guide anyway had been quickly withdrawn, officially because of insufficient demand, but according to rumour because the Council feared it might attract derision.

Predictably, the main protagonists remained guarded. LBWF insisted that Mr. Ince’s ‘alleged dual position’ was a matter for North London Ltd. alone. The once ebullient Cllr. Rusling declined an invitation from the Waltham Forest Guardian to comment. For its part, North London Ltd. regretted ‘the apparent failure of the project’, and announced that it had accepted Mr. Ince’s resignation. As a statement explained, what it wished for now, being ‘an honourable, not for profit company’, was positively to support the stallholders, while continuing to investigate the situation ‘including consulting with interested parties’ (Waltham Forest Guardian, 9 August 2012).  As to Skateco (UK) Ltd., there was only silence, reflecting the fact that on 12 September 2012 Mr. Jokat had appointed a liquidator, Geoffrey Martin and Co..

For most of the stallholders, this latter development represented an opportunity. They had been preparing a case against Skateco (UK) Ltd. for ‘misrepresentation’ anyway, and so they simply took this to Geoffrey Martin and Co. for inclusion in the liquidation process, submitting ‘proof of debt’ forms valued at £275,011, £175,081 for rental monies paid and £99,930 for ‘consequential overheads and loss of earnings’ (Geoffrey Martin and Co., ‘Return of Final Meeting in a Members’ Voluntary Winding Up’, 20 August 2014).

In response, the liquidator sought legal opinion, and was advised that though an action to enforce any such claim was quite likely to fail (‘Many of the statements made [by Skateco (UK) Ltd.] could be interpreted as mere statements of opinion which cannot form the basis of a claim for misrepresentation’) the court costs might reach somewhere between £30,000 and £40,000, a sum that for obvious reasons would be difficult to recover. Accordingly, Geoffrey Martin and Co. decided that its best course of action was to offer the stallholders 20 per cent of the rental monies that they had lost, in total £35,016, which was conveniently ‘less than the legal fees payable to defend the claims, and without the risks and delays of taking the matter to Court’.

Perhaps unsurprisingly, the stallholders response to this was ‘not encouraging’, and as a result the administrator contacted both LBWF and North London Ltd. to ascertain whether they would add to the sum on the table, pointing out that if they did not, they might be drawn into ‘secondary legal proceedings’. In the following months, LBWF offered between £750 and £1,000 per stall, on condition that North London Ltd. contributed, too; while North London Ltd. continued to plead poverty, arguing that since it was a not for profits organisation, it had no funds in reserve. After much further negotiation, in June 2013 all three parties finally came together, and proposed a joint settlement that would give the stallholders 34 per cent of the rent that they had paid in return for the termination of all claims.

There was one further twist in the story. For a few weeks later North London Ltd. suddenly withdrew from the arrangement that had been agreed, and so left all the parties back at square one. Thereafter, the saga stuttered to a close, with eight stallholders reluctantly accepting the 20 per cent goodwill payments originally offered – which amounted to £27,909 in all, or £3,489 per claimant – and the rest departing to lick their wounds.

Subsequently, Geoffrey Martin and Co. completed the details of the liquidation. There was £519,348 to distribute, most of it cash at bank, (presumably made up of Leyton Market rents plus accrued earnings from other ventures, principally the ice rink which Skateco (UK) Ltd. had previously operated at Canary Wharf). Of this, roughly £400,000 went to Brian Jokat as sole shareholder, £59,000 to the various professionals involved, and £27,000 to HMRC, with the goodwill payments for the stallholders really a matter of small change, in all only 5 per cent of the total.

One small detail perhaps provides a suitable epitaph for the whole Leyton Market fiasco. In the joint venture agreement it completed with North London Ltd. and LBWF, Skateco UK Ltd. was allotted the entire income stream from rents. But the actual collection of these monies was less straightforward. For while Skateco (UK) Ltd. collected from the majority of stallholders, North London Ltd. collected from the rest, in the process amassing no less than £69,489. So when Geoffrey Martin and Co. was completing Skateco (UK) Ltd.’s liquidation, it necessarily had to ask North London Ltd. for this money to be passed back. The latter of course willingly obliged, though it is amusing to find that the self-styled ‘honourable, not for profit company’ nevertheless made sure it held back the sum of £17,940 (26 per cent) in order, as it explained, to ‘offset costs’.

Oh yes, and Private Eye awarded LBWF a ‘gold medal for ineptitude’, having covered the story under the headline ‘Chariots of Ire’.

Postscript

In late 2013, some weeks after the final goodwill payments had been settled, a letter dated 31 August 2011 surfaced in which London’s Commissioner of Transport Peter Hendy told Cllr. Chris Robbins: ‘As you are aware Leyton station is not classed as a gateway station as only 200 extra passengers are predicted to use the station in the morning peak during the Games. However given its proximity to Stratford Station it is clearly appropriate to plan for the unlikely event of Central Line trains being unable to stop at Stratford. I should point out that our modeling indicates that Stratford Station will be able to cope with the numbers permitted…and we do not expect many trains to have to “non stop” at Stratford and certainly not the “one in two” trains mentioned at our last meeting’.

Shortly afterwards, the Waltham Forest Guardian posted a story referencing the contents of this letter on its website, but then rapidly pulled it.

The story has never reappeared.

Related Posts

‘Our Olympics’: (1) LBWF and Leyton Market – the Council wins a ‘gold medal for ineptitude’

‘Our Olympics’: (2) The National Construction College’s Cathall Rd. facility

‘Our Olympics’: (3) The Cann Hall – Cathall – Leytonstone – Wanstead 2012 Dispersal Order (DO)

‘Our Olympics’: an introduction

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