A private company linked to Durand Academy has finally agreed to hand back land on the now-closed school’s site, but is demanding compensation from the government.

Durand Education Trust owns land occupied by a leisure centre and housing at the school in Lambeth, south London.

The school’s original sponsor, Durand Academy Trust, is being wound down after disputes over finances and allegations of conflicts of interests.

DET’s 2017-18 accounts revealed the Department for Education demanded assets associated with the school were returned to Lambeth Council by January 1, 2020, but trustees refuted this and sought legal advice.

But Schools Week can reveal an agreement has now been reached and the land, including leisure centre facilities and accommodation on the site, will be transferred to Lambeth by March 31.

A spokesperson for DET said the company is still taking legal action to secure compensation.

However, that appears to have taken a blow after an application for judicial review on the transfer was rejected.

The DET spokesperson said the implications were “much bigger than Durand – the refusal to properly compensate a private charitable trust for land which has been removed from them, which has had significant private money put into it to enhance it over the years.

“If the secretary of state is allowed to force the transfer of those assets, without compensation, then every voluntary-aided school, every Catholic school and every Church of England school – every school with any type of foundation – needs to be very, very worried.”

Lambeth Council owned the land and buildings on the school site until it academised in 2010, when they were transferred to DET.

When the school was rebrokered to Dunraven Educational Trust in September 2018 – becoming Van Gogh Primary School – its building transferred too, but DET retained control of the rest of the site.

Durand also operated a satellite boarding school in Sussex, which closed in 2017.

The school, which was on the market for £4 million, has now been sold. The DfE said it is still working with DET’s solicitors on recouping the money for the benefit of Van Gogh primary.

DET insisted the DfE has “no basis” to claim any proceeds.

In April, DET changed its charitable objectives to the educational advancement of Lambeth residents aged under 30. It previously specified helping Durand pupils.

Sir Greg Martin, the former head of the school who quit in 2015, is entitled to £850,000 from the profits of the leisure facilities under a “special payment” contractual agreement.