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HIE reaches £11m out-of-court settlement over Cairngorm funicular failings

By Gavin Musgrove

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The Cairngorm funicular was out of action for more than four years because of safety concerns about the concrete pillars supporting the two kilometres of track.
The Cairngorm funicular was out of action for more than four years because of safety concerns about the concrete pillars supporting the two kilometres of track.

Highlands and Islands Enterprise has reached an out-of-court settlement with the owners of the firm over failures in the building of the Cairngorm funicular.

A deal has also been struck with the previous operator of the resort for failures to fulfil guarantees given when Natural Retreats took over the operation.

HIE is receiving a total sum of £11m.

An agency spokesperson said: "Parties involved in legal cases relating to the original design and construction of the Cairngorm funicular railway in the 1990s and early 2000s and guarantees in place with the previous operator have reached an out-of-court settlement.

"This means the cases will not proceed to a court proof hearing which had been scheduled to begin in August."

Highlands and Islands Enterprise (HIE), which owns Cairngorm Estate and commissioned the funicular, had been pursuing legal action in the Court of Session against construction company Galliford Try Infrastructure Limited and designer A.F. Cruden Associates Limited.

HIE was also seeking payment relating to guarantees issued by Natural Assets Investments Ltd (NAIL) which was the parent company of previous operator CairnGorm Mountain Ltd (CML), and from NAIL’s main shareholder.

Built at a cost of £19.5m, Scotland’s only funicular railway opened in 2001.

Construction was publicly funded through HIE, with around £2m in support from the European Regional Development Fund.

The service was withdrawn in September 2018 by then-operator CML, after an inspection raised safety concerns about the integrity of the two kilometre concrete viaduct.

In December 2018, HIE took over operations through a new subsidiary, Cairngorm Mountain (Scotland) Ltd, which continues to manage the resort at present.

The funicular returned to service in January this year, following a four-year programme of inspection, design and engineering works at a cost of around £25m.

Related articles:

Cairngorm funicular is back on track and here's the proof

HIE given go-ahead to continue legal action over funicular failings

HIE reveals the true cost of repairing the Cairngorm mountain railway

Stuart Black, chief executive of HIE, said: “We are pleased to have reached this settlement which enables us to recover a significant amount of public funding and brings closure to these long-standing matters.”

HIE said there is no further breakdown for the settlements at this time.

Strathspey MSP Fergus Ewing had responsibility for snowsports in Scotland for more than a decade and has been an ardent support of the mountain railway.

He said: “It is excellent news that HIE have successfully recovered £11 million in litigation settlements.

"Given the criticism to which they have been subjected over the years – mostly unfair in my view – this outcome does prove that the contractual arrangements HIE put in place provided reasonable protection for the public money invested.

"I hope the vocal critics over many years – the Cairngorm carpers of which many are from outwith the area – will now pack their bags and seek other targets or just travel to Cairngorm and our other outdoor ski resorts to enjoy snowsports and other leisure facilities.

"I trust that all local politicians will also follow suit.

"Let’s now all get fully behind our outdoor snowsports centres and work to provide them with a sustainable future all year long.

"I hope funds recovered can now be used for further investment in updating facilities.

"My congratulations go to all at HIE who have brought about this successful result."

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