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A council says it will "vigorously defend" itself against a potential financial claim from a financially troubled local authority.

South Tyneside Council, along with Stockton Borough Council and 21 other local authorities, may be sued by Thurrock Council in Essex over solar farm investments which resulted in huge losses.

A spokesperson for South Tyneside said it was "aware Thurrock is considering legal action" against it and considers this "completely unjustified".

Stockton Borough Council confirmed it is "considering our next steps".

'Significant legal costs'

Thurrock, in south Essex, became effectively bankrupt two years ago after it borrowed and invested hundreds of millions of pounds and racked up a £1.5bn debt.

It received valuations for its solar investments from the Association for Public Service Excellence (APSE), which is owned by local councils.

The authority "believes that valuations of the solar assets undertaken by APSE, which they allowed the council to rely on, were negligent and overvalued those assets".

APSE said it "entirely rejected" Thurrock's statement that valuations "led to significant financial losses to Thurrock with negative impact on taxpayers".

Thurrock Council told the ������̳ the potential claim was "against a representative group" of councils who are APSE members "to reduce the impact and cost of the legal action for all the councils involved".

But Mo Baines, chief executive of APSE, said this would lead to "significant legal costs on other councils which we believe has no merit".

She said she "remains hopeful there is a positive resolution".

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