A COUNCIL faces paying out half of its reserves to meet a compensation claim over its decision to close a pier over safety fears.

Hastings Borough Council could be facing a legal bill running into millions after their latest legal defeat at the Supreme Court over the closure of the town's pier in 2006.

The four-year long legal dispute with a firm which bought the claim from the bankrupt company which ran the pier’s bingo hall and amusement arcade will now be resolved in the upcoming months.

The authority has set aside £1.8 million in its accounts to meet the costs of the claim but Manolete Partners chief executive Steve Cooklin said he would be pursuing £5 million plus interest and the large legal and expert costs of taking the claim through three trials and an arbitration.

Mr Cooklin criticised the council for failing to agree to an early commercial settlement against his firm which has lost just one of its 144 cases.

Council officers said the authority would “argue forcefully” for any payout to be as low as possible and have taken heart from the law lords’ judgement that the poor state of the pier in 2006 would lessen any losses incurred by pier businesses.

It is the third successive victory for the claimants in the dispute having previously won in the Technology and Construction Court in 2012 and the Court of Appeal a year later.

The level of damages will now be resolved in arbitration with a decision not expected for several months.

Mr Cooklin said: "Most private companies and individuals who are the defendants of our claims, see the good sense in negotiating a sensible early commercial settlement, rather than expending large legal costs on both sides.

“However, this case amply shows that we are willing and able to go through an extended and expensive legal process if and when that is what is necessary to achieve justice for the creditors".

Council leader Peter Chowney said the local authority continued to believe they were “entirely correct” to close the pier.

He said: “Although we are obviously disappointed to lose the appeal, we absolutely believe it was the right thing to do.

“We do not think that the taxpayers of Hastings should have to pay significant sums of public money when all we have ever done is act in the best interests of public safety.”