The Scottish Government has been accused of holding up the demolition of the fire-ravaged Lundin Links Hotel.
The body is the main creditor of liquidated company Kapital Residential, which owned the C-listed building.
And it must agree to its demise before any work can start on the site.
The Scottish Government provided Kapital Residential with an £850,000 Covid Recovery Loan and only £150,000 was paid back.
The building is in a perilous state following the catastrophic blaze on August 18.
And the A915 past the site is still closed for safety reasons.
Two 15-year-old boys have been charged in connection with the fire.
Liquidators have until September 12 to begin demolition and work must be complete by October 10.
However, while they have appointed a contractor and are keen to go ahead as soon as possible, they are still waiting for the Scottish Government’s say so.
The Scottish Government said the claim was “categorically untrue”.
Possible court action over Lundin Links Hotel demolition
Liquidator Claire Middlebrook said she had been in daily contact with Holyrood officials but they have yet to confirm their position.
She is now taking legal advice with a view to possible court action.
“The legislation we operate under means we have to liaise with the secured creditor,” she said.
“That’s not been an easy task for me.
“One option is to look at potential court action in order to make the creditor come along with me.”
Ms Middlebrook confirmed that once a demolition company was on site, it would take three or four days to bring the building down.
“We are teeing everything up and as soon as we are able to, we will begin all the work,” she said.”
Liberal Democrat MP Wendy Chamberlain described the situation as “utterly shocking”.
“If this were happening outside the First Minister’s residence or in the middle of a city centre, we would not be in this situation,” she said.
The Scottish Government has been approached for comment.
Road closure is causing chaos
Around 160 residents who crammed into a public meeting on Monday reacted with shock at the news.
The ongoing road closure is causing chaos, with scores of drivers ignoring diversion signs and blocking the narrow streets of Lundin Links and Lower Largo.
HGVs have continued to enter the villages, where they have to cross a weak bridge.
And business people in Leven Road have seen customer numbers plummet.
Zaphar Iqbal, who runs the Premier Store, says he may have to close.
“It’s really affecting me and other businesses,” he said.
“A third of my business has gone and I don’t know how long we can keep going.
“I may as well shut my business.”
And it’s not just people in Lundin Links who are suffering.
The ongoing diversion affects people across the East Neuk who are having to make long detours to get anywhere.
Meanwhile, people living in tiny villages away from the diversion route face a huge increase in traffic as drivers seek shortcuts.
Neil McKeown, of New Gilson, said: “I know you can’t stop people coming this way but the roads aren’t built for this kind of traffic.
“It’s a C-class road and traffic is just ploughing through.”
Fife Council to review diversions
Fife Council has resolved to tackle the issue and it will review the road signs in place.
Head of protective services Nigel Kerr said: ““Public safety is our number one priority.
“Traffic diversions have been in place since the fire for safety reasons until the building can be demolished, and we appreciate the concerns that have been raised in terms of traffic management.
“As promised, we will review those measures.”
Another public meeting will be held to discuss progress as soon as possible.
A date and venue will be confirmed soon.
Lundin Links and Largo community council chairman Peter Aitken said: “I’m pleased we were able to have a public meeting and people were able to have their voices heard.”
Conversation