Allegations of missing and tampered documents and a possible conspiracy to conceal information have been levelled against two government departments embroiled in a multi-million-pound civil claim.

Development company Sondica Group Inc is seeking damages of between £50m to £90m in relation to its ultimately unsuccessful bid to redevelop the North Quay site in Douglas.

No trial date has been set in Sondica’s long-running case against the Department of Infrastructure, the Treasury and London-based consultants Lambert Smith Hampton (LSH).

But in a case management hearing at the high court on Friday, Sondica’s advocate Vicki Unsworth claimed there are in excess of 100 documents that the two government departments had failed to disclose.

She said, ‘one could be forgiven’ in believing there has been a ‘conspiracy to conceal’. ‘It’s suspicious that we have such a significant number of documents missing,’ she told the court.

Ms Unworth said an order for disclosure has been made in February 2019 but six and half years on there had still not been compliance with that order, and the claimant had had to ‘spoon feed’ the government to push for documents.

‘We are told they don’t exist, or they can’t find them and then ultimately produce them. It’s extremely painful and costly,’ she said.

LSH had disclosed documents relating to its correspondence with government departments, but those departments had failed to provide a significant number of the corresponding emails and paperwork, the court heard.

Ms Unsworth said this showed that ‘either the government departments have not searched properly, or they had destroyed or deleted documents’.

She held back from alleging that documents had been deliberately destroyed.

But she did allege that some of the documents had been tampered with and gave the example of an email produced by government which ‘stopped in mid-air’ but the same email, as supplied by LSH, had ‘a whole host of additional words’.

Ms Unsworth said LSH had taken a ‘reasonable approach’ to disclosure.

Sondica is claiming negligent misstatement and misfeasance in public office. Its specific disclosure application will be heard in early November.

But advocate representing the DoI and Treasury, David Keates, insisted: ‘We are doing the best we can to find these documents.’

He said some had already been disclosed while others fell outside the parameters of the agreed search.

Deemster Andrew Corlett said the issue of missing documents was a concern - and he suggested the claimant’s claim needed to move swiftly now to trial.

He said: ‘The timescale is disturbing for all sorts of reasons. This has gone on long enough. This matter needs a trial date fixing. We are looking at early next year really.’

The dispute dates back to early 2015 when the Department of Infrastructure (DoI) invited expressions of interest in the development of 3.17 acres of land on Lord Street and Parade Street, which included the former bus station site.

It was described as a ‘unique development opportunity’.

Douglas-based Sondica acted as part of a consortium of businesses known as the North Quay Consortium which put together a tender for the development.

LSH was appointed by the DoI as professional advisers to assess the bids received.

Sondica’s first tender, submitted in September that year, involved a £55m investment which included a Marriott ‘Courtyard’ Hotel, a four-screen cinema, a Marco Pierre White New York Italian restaurant, a Winter Gardens, new bus station facilities, a multi-storey car park, nine apartments, 55,000 sq ft of office space and small retail units.

Its tender was placed on a shortlist of three.

Approval was sought from then DoI Minister Phil Gawne to appoint Sondica as the preferred bidder.

But then in March 2016, the Chief Minister’s regeneration steering group rejected its tender bid and decided to start a new tendering process.

This decision came after the DoI, whose evaluation team had previously agreed Sondica had the best bid, claimed that the consortium now required government to provide an ongoing financial guarantee believed to be £1.9m a year.

In July 2016 a fresh call for interested bids was issued by the DoI.

Kane Limited, which submitted an offer of £600,000, far below Sondica’s initial one of £4.1m, went on to secure the tender - despite it having been rejected at an early stage in the first round.

Sondica’s claim alleges ‘undue pressure’ was put on LSH by an officer in DoI to change its independent expert opinion on what was the best bid which resulted in it not being recommended as a preferred bidder.

Sondica is claiming damages for breaches of contract and duty as well as losses, plus interests and costs.

It alleges ‘negligent misstatement’ against an officer in the Treasury for describing the request for a guarantee as ‘irregular’ and having the potential to compromise the tender agreement.

It also alleges misfeasance in public office against a named individual for which it says the DoI is vicariously liable.

A new planning application by Lord Street Development SPV Ltd for a major redevelopment of the long-vacant Lord Street site was resubmitted towards the end of May (25/90516/B).