A MULTI-million pound legal dispute over a recently opened road in Taunton is set to rumble on - despite the collapse of the firm that built it.

Somerset County Council says it will resist "excessive and inflated claims" from construction company Carillion following the completion of the Northern Inner Distributor Road (NIDR).

The mile-long road from Staplegrove Road's junction with Chip Lane through to Priory Avenue finally became operational in July, 27 months late.

The council and Carillion have both remained tight-lipped about the reasons behind the delay, but it is believed the firm slapped in a bill for almost double the £22 million contract agreement.

County Hall is thought to have earmarked a further £3 million for the project, but it is refusing to meet Carillion's demand for tens of millions of pounds extra.

And the local authority has mounted a "substantial claim" against Carillion, which went into liquidation this week with a £900 million debt and a £587 million pension fund deficit.

Cllr David Fothergill, leader of Somerset County Council, said: "Our thoughts are with all Carillion’s employees and their subcontractors who will be understandably concerned about the future.

"However, today’s announcement would seem to reflect the difficult relationship that we have had with them as a contractor.

"We are fortunate that the NIDR has been completed, though it was of course subject to major delays.

"We remain in dispute with Carillion and have repeatedly and robustly resisted its excessive and inflated claims for costs.

"We also still have a substantial claim against Carillion for delays and will continue to pursue this.

"This is a developing situation and we will be working with the official receivers to resolve this matter as soon as possible."

A county council spokesman said the authority is not commenting on costs or figures at this stage, adding that it has no other contracts with Carillion.

He also declined to say if any taxpayers' money has so far been paid to Carillion following the building of the NIDR.

Carillion chairman Philip Green said efforts had been made to restructure the firm to deliver "its sustainable future" ahead of going into compulsory liquidation.

He added: "In recent days however we have been unable to secure the funding to support our business plan and it is therefore with the deepest regret that we have arrived at this decision."

Cabinet Office Minister David Lidington said: "It is regrettable that Carillion has not been able to find suitable financing options with its lenders but taxpayers cannot be expected to bail out a private sector company."