Why I pulled out of Zurbarán deal

15 December 2011

The Church Commissioners’ conditions made the deal unworkable, says Jonathan Ruffer

The First Church Estates Com­missioner and the chief executive of the Church Com­missioners are good eggs. I have come to know them both intimately over the past year. Andreas Whittam Smith is by nature a buccaneer: quick to offer the hand of friendship, decisive and brave. He generously accepted an apology for a remark I made which had hurt him. Andrew Brown is a very different character, the antithesis of the smutty joke: he is wholesome, serious, and dutiful. He would make an excellent minor royal.

Yet these men have managed to torpedo two deals, to the detriment of one of the neediest regions of the UK.

Two years ago, I decided that I would work with urban deprivation in my native north-east, and take more of a back seat in my investment firm. I wanted to be a bridge-builder and an encouragement in the area. So, at the news that the Commissioners were going to sell the Zurbarán pic­tures in Auckland Castle, I offered to buy them, to be held in trust for the people of the north-east (News, 12 November 2010, 1 April 2011).

Andreas accepted the offer, and it was confirmed by the assets commit­tee and the Board of Governors with unconditional assent.

The Second Church Estates Commissioner, Tony Baldry MP, the formal representa­tive in Parliament, spoke to the House of Commons and reinforced this unconditionality. He stated that “the paintings will be sold to a new Trust, which will have a specific ob­liga­tion to ensure their preservation and continued display at Auckland Castle.” There were rejoicings all round.

ANDREAS and Andrew had other ideas, however. Between 22 February (when the deal was agreed initially) and 28 March, they unilaterally added three conditions that are (and I quote): “The transfer of the Castle and ancillary buildings to some form of public ownership, the grant of plan­ning consent for a new See House as a home for future Bishops of Durham, and the satisfactory grant of planning consent for a mixed use but largely residential scheme on agricultural land owned by the Commissioners nearby. . . As I am sure you would ex­pect, all agreements between us must remain subject to contract.”

The effect of these three “con­ditions” is to render the agreed pur­chase unachievable. The first, the project to revitalise the Castle, may yet happen. The Church Commissioners have now abandoned the idea of a new see house; so the second is in­capable of being met. And the third is in the gift of Durham County Council, and on land not even in a develop­ment zone.

Andreas and Andrew are neither mischievous nor malicious. They are decent men who have gone wrong. Through a historic accident, and a few “myths of convenience”, they appear to be no longer accountable to dio­cesan bishops or even the arch­bishops.

When the Commissioners first appeared in the 1835 legislation, they were little more than financial beadles. They were promoted in the 1947 legislation, but they remained the secular servants of a Commission dominated by the diocesan bishops. But the bishops got busier, the legis­lation got more complex, and the rules were changed: it was easier to let the three Estates Commissioners run the show.

True, the diocesans get to elect an acting chairman, and the Archbishop of Canterbury is the actual chairman, but I have seen at first-hand how the present incumbents are treated. The acting chairman’s offerings are treated as “suggestions”, and I witnessed last month the Primate of All England pleading for the future of the Castle. The Archbishop pleading; Andreas untouchable, untouched.

It suits the First Church Estates Commissioner to promote this chimera of absolute power. Here is Andreas in the General Synod, swatting the bluebottles of outrage at the disposal of the Octavia Hill Estates: “The assets committee of the Church Commissioners under the law establishing the Church Commis­sioners has exclusive control over the assets.”

He goes on to cite a legal case known as the Oxford Judgment, of which he says: “I am not disposed myself to ignore a statement so solemnly given, addressed to the Commissioners.” That is the very judgment where the vice-chancellor added an important rider regarding the assets committee: “Subject to any general rules made by the Board for the committee’s direction and guidance, the assets committee has the exclusive power . . .”

To anybody outside the rarefied world of the ecclesiastic, it is obvious that a board has the power to con­strain a committee; but the complete absence of constraints here allows Andreas and Andrew to ignore the pleas and suggestions of both their chairmen. This time, they have gone one further, and overruled even the assets committee. And if the House of Commons seems to have been misled, then so be it.

I have had to deal with these people not only with the Zurbaráns but also in my position as chairman of the Auckland Castle regeneration project. The evasions and disappointments have come like grouse — sometimes singly, sometimes in coveys.

There were four undertakings from Andreas that the Castle would be transferred to the consortium for no cost, another to a plenary meeting of the project, yet another to Lord Rothschild — at the exact moment a valuer had been invited to establish a value of the Castle on the basis of vacant possession (vacant possession requiring no pictures, no public ac­cess, and no bishop). In September, it had come to my attention that they were asking for a further £1.7 million for the transfer of the freehold.

All through this we have spent money to keep up the project’s mo­mentum — mostly my money. As we approached a deadline to sign for £200,000 of consultancy work to pro­duce an architectural proposal, I warned them that this would be wasted money if they did not act realistically, and I gave them a dead­line.

The deadline passed, and I resigned from the regeneration project and withdrew from the Zurbarán deal — thereby making it two slaps in the face for County Durham from the First Church Estates Commissioner and his chief executive.

Jonathan Ruffer is chairman and chief executive of Ruffer LLP.

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