Monks Eleigh is in turmoil after the collapse of a project to build a new community hall left the village divided over how to pay back creditors.
Village group Mesch - Monks Eleigh School Community Hall - was registered as a charity in 2008 to raise £500,000 to replace the existing defective village hall with a new shared facility on land at Monks Eleigh Primary School.
But with the school closing, education authority Suffolk County Council has withdrawn support for leasing the land and grant funding, leading to the winding up of the charity.
Villager and Mesch member Kathy Haddow says the village has been left in turmoil, adding “it’s friends against neighbours”.
Problems started when Mesch trustees decided to take professional advice from accountancy firm BDO, deciding to wind up the charity using a creditors voluntary liquidation agreement.
Mrs Haddow feels the decision to use BDO to liquidate the charity was unnecessary and feels the money could be paid back without them.
In a balance sheet seen by the Free Press, the charity is shown to be financially solvent – due to the county council deeming its grants of nearly £51,000 ‘spent’ and not needing to be paid back – able to reimburse all creditors, and still have £6,697 left, potentially to use on a new village hall project.
Mesch chairman Sarah Hodgkinson, however, said the Charity Commission had advised the group to take professional advice and follow this, which it has done.
Consultations and meetings with creditors have cost more than £6,000 and Mrs Haddow said if a plan to use the firm to wind up the company goes ahead, it would result in further fees totalling in the region of £18,000, putting this solvency and the ability to pay back creditors at risk.
“Our aim, as trustees, is to refund all the funders as far as possible,” said Mrs Hodgkinson.
She added that if all the money could not be paid back, this would be paid out on a pro-rata basis, nevertheless Mrs Haddow is worried about the future of the village.
“The whole thing stinks,” she said. “We are risking our village reputation here – if we don’t pay the grant funders back, we will have burnt our bridges.”
Mrs Hodgkinson vowed the issue “would be sorted”.
A vote to wind up the company using BDO has now been defeated in a vote of members twice.
Mrs Haddow has complained to the Charity Commission on the way Mesch has been run, disappointed that, in her view, its first duty has not been to protect the interests of creditors.
“They didn’t even have indemnity insurance,” she said. “And they spent £65,000 towards planning without a lease. It beggars belief.”
The commission has told the Free Press it is “satisfied the trustees are dealing with the matter”.
With no lease agreed by Mesch and the county council the parish council decided to make alternative plans for the building of a new village hall as a plan B.
It has since been given planning permission for homes to be built on the current site, and is now planning to build a new village hall on the recreation ground.