Manthellan demanding Prostějov to pay CZK 40 million in compensation

by   CIJ News iDesk III
2023-03-15   13:34

The developer Manthellan is demanding CZK 40 million in compensation from Prostějov for not being able to invest CZK 1 billion in the construction of the Galerie Prostějov shopping centre in the city centre. The financial demand for compensation for the costs incurred and lost profit is contained in a proposal for an out-of-court settlement of the dispute, which Manthellan sent to the town hall. The proposal will be discussed by the city council and then by the town council. The Prostějov Gallery project was prepared by a group of investors around businessman Richard Morávek, who built the Šantovka shopping centre in Olomouc.

According to Jura, Manthellan's proposal for an out-of-court settlement of the long-running dispute includes a demand for compensation of CZK 20 million. According to the mayor, the company does not intend to discuss this amount any further. The second item is the demand for payment of lost profits worth CZK 20 million, where Manthellan is willing to accept the city's offer of land worth CZK 15 million.

Councillors are expected to discuss Manthellan's proposal in two weeks' time and then propose a resolution to councillors, which the Jury said is likely to include both a yes and no option. It will then be up to the council to either grant or reject the proposal, which could result in a court hearing of the dispute. Jura noted that the courts have previously ruled that the city's contracts with Manthellan are absolutely void.

The Prostějov gallery was to be built in the city centre on the site of the cultural and social centre. The shopping mall project failed to come to life after the town hall changed its mind in 2018, after consulting with lawyers, about the validity of the 2010 agreement on the future contract, which concerned the preparation of this business plan. The council's position was upheld by the Court of Appeal in 2019, which upheld the invalidation of the contract with the developer. The investor subsequently filed an appeal to the Supreme Court, but failed.

In 2018, the City Hall filed a lawsuit to evict the land used by Manthellan in the city centre. The court then ruled that the lease agreement for the city land between the city hall and Manthellan, which planned to build a shopping centre on the plots, was also invalid. Manthellan had demanded CZK 320 million in damages from the town hall in a pre-suit notice in 2019, but dropped its demands after mediation.

Source: CTK