Clays Lane Housing Cooperative in east London has failed to get a judicial review of a Housing Corporation order that it transfer its stock to the Peabody Trust.
The corporation chose Peabody because of its perceived financial strength, but the association has since suffered high-profile money problems (HT 19 December 2003, page 7).

However, the High Court of Justice rejected Clays Lane's argument that Peabody's financial troubles should preclude the transfer.

The judge said the Housing Corporation could not have known of Peabody's financial issues when it demanded the transfer in September 2002.

Clays Lane, which manages 450 homes in east London, has been under supervision for 16 years.

It would have preferred to merge with Tenants First, a co-operative based in north-east Scotland.

A source close to the case said he would be surprised if Clays Lane appealed because of clear evidence suggesting that the co-op had been mismanaged over a number of years.

The corporation has issued a statement confirming it intends to transfer Clays' stock to the Peabody Trust.

Source

Housing Today