THE saviours of Morecambe's Midland Hotel have been barred from being company directors - throwing the future of the art deco landmark into doubt once more.

Only last month Lincoln Fraser and Jared Brook were unveiled as the new owners of the Midland with ambitious plans to spend £3 million restoring the hotel to its 1930s hey day.

But at Blackpool County Court last week, Mr Fraser and Mr Brook's involvement in the Morecambe hotel in the early 1990s came back to haunt them.

The court heard that their company, Progressive Leisure Corporation Ltd, had traded while insolvent, failed to maintain proper accounts and tendered cheques to creditors which could not be honoured.

Worse still, they allowed the hotel's owner, the late Les Whittingham, to misappropriate cash from the business and incorporated the debts of another company, Otan Ltd, without any benefits to Progressive.

Mr Brook and Mr Fraser claim the case against them was based on 'technical issues' and insist there was 'no suggestion that either of us acted dishonestly.'

They still intend to go ahead with the ambitious multi-million pound make-over but a stunned City Council is seeking reassurances from their new company, Kalber Leisure.

Mr Fraser and Mr Brook have issued a statement saying that the court's decision "will have no impact because the development is self-capitalised by ourselves." They added: "We were all disappointed that the judge was not allowed to take into account the companies that we have both been involved in since that time, which have been extremely successful."

An embarrassed City Council, who had made stringent checks on the company buying the Midland, are now trying to discover Kalber Leisure's future plans.

The Director of Regeneration, John Donnellon, said: "Whilst the city council does not own the Midland Hotel it does have responsibility for the stewardship of this important listed building. We will be seeking urgent talks with Mr Fraser and Mr Brook to find out precisely how they plan to and even if they can proceed following their disqualification."

The court's ruling looks certain to have finished off hopes for a deal on the Bubbles site. Bubbles will probably be demolished before the end of the year to make way for a festival arena site.

Kalber Leisure had wanted a 999 year lease on the complex at a cost of £225,000 with a view to developing the site into a family aqua park.

At a meeting last week, many councillors said they were concerned about Kalber's proposals for the complex and requested that Mr Fraser and Mr Brook attend the next Full Council in order to present their proposals and answer questions from the floor.

Mr Donnellon said that following the court's revelations it was unlikely that the meeting would now take place.

The cabinet will now consider a report which will reconsider the demolition option.