A court case claiming that the tender for accommodation at Lews Castle was awarded unfairly collapsed in Edinburgh today.
At the Court of Session, Lord Tyre accepted the Comhairle’s case that the claim against the tendering award had not been made timeously, and dismissed the claim by Kenman Holdings at the first stage.
Kenmans did not submit a tender for the contract.
A major row erupted earlier this year when Kenman Holdings Ltd, the holding company for the Cala Hotels Group, announced it was seeking a judicial review of the tendering process relating to the accommodation aspect of the project.
The tender was awarded to global accommodation provider ‘Natural Retreats’ through its parent company ‘Natural Assets Investments Ltd’.
Kenman Holdings claimed that the tender process was not genuine and was significantly non-compliant with applicable European laws.
They also asserted that European rules on the award of concessions and the rules on state aid had been breached.
Welcoming today’s announcement, Cllr Angus Campbell, Leader of Comhairle nan Eilean Siar and Chair of the Lews Castle Project Board, said: “The Comhairle was always confident that its processes in the awarding of the contract were proper and competent.
"The restoration and development of Lews Castle is hugely popular and will provide a major economic boost for the islands when the museum and the luxury hospitality development opens next year.”