Edinburgh Council Settles Legal Claim Over Tram Project Advice
The City of Edinburgh Council has reached a settlement in its multi-million pound damages claim against DLA Piper, the law firm that provided legal advice during the initial tram project.
The council had sought compensation exceeding £200 million, alleging that DLA Piper failed to adequately warn about the potential cost escalations of the tram line.
However, the terms of the settlement with DLA Piper include a confidentiality clause, preventing the council from disclosing specific details of the agreement.
The original tram project, which connected the city centre to the airport, exceeded its budget by £400 million and was completed five years behind schedule.
The settlement was reached prior to a scheduled hearing at the Court of Session.
A report prepared for a full council meeting on Thursday stated:
"The litigation against DLA Piper Scotland LLP was resolved out of court in March 2026."
DLA Piper has been contacted for comment regarding the settlement.
Investigation into Council Oversight and Inquiry Findings
The report also disclosed the findings of an internal investigation conducted by the council's monitoring officer concerning criticisms made by Lord Hardie in his tram inquiry report.
The £13 million inquiry, concluded in 2023, determined that failures by the City of Edinburgh Council and its associated arms-length companies were responsible for the tram project's delays.
The council's monitoring officer has now formally stated that the local authority was guilty of maladministration.
This conclusion was initially reported privately to councillors in December 2023 due to ongoing legal proceedings but has since been made public.
The report noted:
"The deputy monitoring officer has reviewed the Edinburgh Tram Inquiry Report and agrees with Lord Hardie that the council failed in a number of important respects to properly oversee the project.
This contributed to the project being delivered late, at an increased cost and with a restricted scope."
Furthermore, the deputy monitoring officer concluded:
"There were serious and systemic failings on the part of the council which, overall, could be described as organisational incompetence."
Council Leader Addresses Past Failures and Future Plans
Council leader Jane Meagher acknowledged the mistakes made during the first tram project and expressed regret for its impact on Edinburgh's residents and businesses.
She stated:
"We've long recognised that mistakes were made on the first tram project and apologised for the impact this had on Edinburgh's residents and businesses.
As a result of this, we made significant changes to project management, governance and independent oversight across the organisation, drawing on lessons from the original project and the findings of Lord Hardie's Inquiry.
The successful delivery of the trams to Newhaven project in 2023, which came in on time and on budget, clearly demonstrates that we've learned these lessons."
Meagher emphasized the council's continued commitment to expanding the tram system:
"One thing we won't apologise for, however, is building a tram system, or our ambition to develop it further.
Edinburgh is Scotland's capital and economic powerhouse – the fastest growing city in the country, and recently overtaking London on GDP [Gross Domestic Product] per head.
Our success drives Scotland's success and a modern, reliable public transport infrastructure is fundamental to sustaining that growth."
She also indicated plans to engage with the new Scottish government:
"I will be writing to the new Scottish government to remind them of the significant benefits a new North-South tram line would bring."
