FIFE Council has won a £3.1 million court battle and will use the money to restore a disused opencast coal mine near Oakley.

It instructed lawyers to go to the Court of Session in Edinburgh in a bid to recover the sum from the Royal and Sun Alliance Insurance PLC.

The council took legal action following the ending of mining at the Blair House site in November 2013.

It had entered into an agreement with UK Coal Mining, the mine’s owners, that within one year of production ceasing, the site would be returned to “woodland, countryside and agricultural use.”

The mine was then taken over by Scottish Coal, which assumed responsibility for returning the site to its original condition.

The Court of Session heard that as part of the agreement, a bond was arranged with Royal and Sun Alliance.

The bond dictated that if no remedial work was carried out, the council would receive payment for £3.1m.

Royal and Sun Alliance refused to hand over the money, arguing that the exact terms of the bond meant they only had to pay out in certain circumstances.

The company stated that the circumstances surrounding the closure of Blair House meant that the bond didn’t apply.

Today, judge Lady Wolffe issued a written judgement in which she ruled in favour of Fife Council.

She wrote: “It follows that the pursuer’s case succeeds.”

Fife Council's Robin Presswood, Head of Service, said: "Fife Council is delighted at the outcome of the court process today.

"This brings the much-needed restoration of a difficult site a step closer. 

"Whilst conscious that Royal Sun Alliance has an opportunity to appeal the court’s judgement, we are hopeful that, in the light of safety concerns regarding abandoned quarries in Fife and elsewhere, they will accept today’s decision and allow restoration of the Blair House site to begin as soon as possible."

The Scottish Mines Restoration Trust took over Blair House in 2014 and chairman Professor Russel Griggs OBE said: “If Royal and Sun Alliance does not appeal Lady Wolffe’s decision, this is a very positive development for the future of Blair House and has the potential to have a significant impact on the site and the surrounding community.

"Our objective has always been to deliver a pragmatic approach to the restoration of the site by bringing it back into community use. 

“While we have been looking after the care and maintenance of the site for the last four years, the ruling (if not appealed) has unlocked the next stage of the process, meaning that a sustained programme of restoration – which incorporates significant land and environmental works – can take place, funded by the restoration bond monies which Lady Wolffe’s decision requires Royal and Sun Alliance PLC to pay to Fife Council. 

“We’re committed to continuing our work with all of the stakeholders involved in the project, and to making Blair House an important and useful part of the Fife community.”