I think everyone on SFM knew that when the new club won its first trophy, whatever that trophy was, the old “same club” mantra would surface. Over the years, and since the nature of the debate is in the “santa exists” ballpark, we have largely discouraged discussion of it.
On the “old club” side, that reluctance to debate is largely because there is little value in arguing the toss with someone who either ;
- knows the idea is preposterous, but won’t admit it for whatever reason; or
- has been lied to by the person at (a) above and can’t be bothered to look at the facts for themselves.
On the “new club” side, the discouragement to discuss is mainly because we are in the main already equipped with the facts, and there seems little need to go over them again and again.
So why republish stevensanph’s blog and Hirsute Pursuit’s response from almost a decade ago?
Well firstly because it is an excellent piece of forensic scrutiny cutting through the fog which had begun to be induced by the MSM merely weeks after they had unanimously heralded the death of the old club.
Secondly because it was written as a response to the (at the time very unpopular) decision we made on SFM to close down the debate on the subject (for the reason stated above.
And lastly because the course of the truth – even if it is only shifted by a few degrees – can get completely lost as time goes by. Consequently, there are possibly many who take sides because of a leap of faith. This is a course-correction that demonstrates the absence of any need to do so.
So here then is a reprise of stevensanph’s remarks from 2013, on his own blog.
The Newco/Oldco debate has been ended over on TSFM, with the deletion of the excellent post from HirsutePursuit marking the end. While some think we need to keep reinforcing the message that its a totally new club, others are bored of the subject, so I can’t blame TSFM for wanting to move on.
Personally – I have read all the arguments – I am yet to be shown any factual proof that Green’s Gers are the old club. People will, and can believe whatever they want. For Rangers fans who want to believe its the same club, then, as long as they are happy, then fine. However, on paper, and in law, its a new club, and thats all that I care about!
TSFM posters wanting to continue the debate can do so below following on from HP’s excellent deleted post!
TSFM
This blog, as far as I have been concerned, is widely regarded as a forum for people who wish to highlight the inequalities and skewed reporting of the issues within the Scottish football arena. If it is not, perhaps you can make it clear what you see as its purpose.
Perhaps the biggest ever story within the Scottish game has been the circumstances surrounding the demise of Rangers Football Club. It is a multi-layered story and one that that is still moving. In many ways, it may be a story that is only just beginning.
Central to the debate (that should be completely on-topic) for this blog, is whether or not the authorities (at all levels) have acted in an equitable manner and whether or not the “free press” have given life to events in a truthful and balanced way.
With absolute regard to these matters, there is a fundamental issue surrounding the status of the club incorporated in 2012 and currently playing in the 3rd division of the Scottish Football League.
If you genuinely believe that the club incorporated in 2012 are the same club as was founded in 1872/1873 then you have every right to be outraged at the behaviour of the footballing authorities. You will probably accept that UEFA were right to “ban” the club from European competitions because of its holding company’s insolvency event; but feel completely persecuted by your fellow Scottish clubs who demoted your team to the arse-end of the game. You will see this “demotion” as a punishment far too severe for the actions of the rogue ex-owner of the club’s former “holding company”. To compound matters, you will see the LNS enquiry as just another opportunity for the clubs who have already revelled in meting out a severe punishment, to have another fly-kick. You would, no doubt, believe that whatever the previous owner of the club’s “holding company” did in terms of player payments, the trophies were won fairly by the club on the field of play and can never be taken away. You will be – in the main – satisfied with the narrative of the “free press” in referring to your club as the same entity as played in the SPL.
All of the attitudes and beliefs rely 100% on the tenet of a “club” existing as a separate entity from the legal entity (“company”) responsible for a football team.
If you genuinely believe that the club incorporated in 2012 are a different club as was founded in 1872/1873 then you will still have every right to be outraged at the behaviour of the footballing authorities. UEFA would rightly refuse European Club Licence for the new club – if one was applied for – as the new club do not meet the criteria; but you will feel completely let down by the self-serving nature of the SPL and the weakness shown by the SFA in attempting to place the new club in the top tier of Scottish football. You will see the new club’s fast-track acceptance into the SFL as without precedent and their award of full member status (of the SFA) as against existing rules. You will wonder how – when the members of the SFL voted to give them associate membership as new club – the SFL executive list them on their website as the old club. As the old club had ceased footballing activities in June, there should have been no SFA membership or SPL share to transfer in August. Since the old club is no more, you will not recognise any punishment for the actions of the rogue ex-owner of the club. You will see the LNS enquiry as an opportunity for some sort of justice in relation to years of outrageous cheating by the now dead club. You will think that trophies and prize-money were stolen from clubs who played by the rules. You will think that a correction of results is simply a consequence of the old club being found guilty of cheating. You will probably think that the LNS enquiry has nothing to do with the new club; but may wonder if the enquiry orders the repayment of the old club’s prize-money, would this create a new “football debt” that has to be repaid by the new club to continue using the old club’s SFA membership? You will be aghast at the apparent repeated mis-reporting of the situation by the “free press”.
All of the attitudes and beliefs rely 100% on the tenet of a “club” being the legal entity (“company”) responsible for a football team.
You may feel that these positions are “just a matter of opinion” and do not ultimately matter.
I disagree. The indeterminate status of the club incorporated in 2012 is a huge sore in the Scottish football landscape. This is the biggest story that just cannot go away. If the schism created by this sense of injustice is not resolved, Scottish football will implode. Attitudes may already be too entrenched; but that should not stop us trying to find a way forward.
The principal difficulty (again totally on topic) is that it appears – from both sides of the debate) -that people in positions of power within the game have made decisions that cannot be justified by their rules and articles of association.
We can – as you wish us to – stop talking about the status of the club incorporated in 2012, or we can continue to argue our respective positions as a crucial factor in this controversy.
In my view we can only hold the SFA, SPL and SFL to account if we insist that a definitive answer to all of the important questions are given.
The status of the club incorporated in 2012 is – in my view – a simple matter of fact. It is only because it is being considered to be a matter of opinion that we are where we are.
The Origins of the concept of a football club having an owner from whom it can be separated and its subsequent misuse by the SPL/SFA in 2012.
The following are taken from a well informed contributor to SFM who points out that pre 2005 no such concept existed in SPL rules and the meaning subsequently applied by LNS and The 5 Way Agreement is a danger to the fundamental integrity of the Scottish football industry and its member clubs.
The very short version of what follows is this:
The SPL articles state that its definitions and expressions need to be given the meanings as described in the Companies Act 2006.
The Companies Act 2006 says that an “undertaking” is “a body corporate” i.e. a company.
Lord Nimmo Smith has ignored this definition and instead accepted (or created) an alternative meaning for “undertaking” (as used in Article 2) which is fundamental to the concept of being able to separate Club from Company.
The principle of Club and company being distinct entities was expressly stated in the commissions terms of reference.
Lord Nimmo Smith has accepted the terms of reference as “facts”.
The SPL articles and rules apply to Clubs and to their “owners & operators”.
LNS asserts that the Club “Rangers FC” was owned & operated by Rangers Football Club plc.
He asserts that the Club “Rangers FC” transferred from Rangers Football Club plc to Sevco Scotland Ltd.
The Club (if found guilty) is still liable for the alleged breaches of SPL rules, even though the Club is no longer a member of the SPL.
He asserts that Sevco Scotland Ltd – as the new owner & operator of the Club – have a material interest in his commissions findings.
However…
Instead of his accepting LNS logic that allows the ethereal Club to be transferred between companies, the truth is – read in conjunction with the Companies Act 2006 – Article 2 really says that the Club is the “body corporate”. The Club is the Company.
The Club is Rangers Football Club plc. That Club is in liquidation.
Since Sevco Scotland Ltd did not purchase Rangers Football Club plc, Sevco Scotland did not buy the Club.
*On the simple basis of Sevco Scotland’s purchase of Rangers FC’s assets, the Commission cannot legally apply sanctions that would fall to Sevco Scotland for remedy.
This issue should have been fairly straightforward. We need to understand why it is not.
It is surprising to me that an experienced high court judge accepted the commission’s terms of reference without first checking its validity. It would be interesting to understand if the statement of reasons was really his own thoughts or a re-hash of the SPL legal advice that framed the commissions work.
It does not surprise me that the SPL have framed the commission in the way that they have. The “transferable Club” logic was first used to unsuccessfully argue that Newco should have Oldco’s share in the SPL. They are acting in their own commercial interest. Sporting Integrity has never been high on their agenda. We know what they are about.
It is hugely disappointing – but perhaps not surprising – that the SFA have not stepped in to clarify matters. Conflicted and/or incompetent probably best sums up its contribution.
Longer version.
The SPL – essentially as a trade association – will correctly do what they can to maximise revenue for their members. It falls to the SFA – as the game’s regulators – to ensure that the SPL’s existing procedures, articles and rules are adhered to.
It is almost without dispute that the SPL have not functioned well in following protocol. The SFA have been incredibly weak in insisting that they do so. In fact the SFA – by being party to the 5-way agreement – are themselves seemingly complicit in going off-plan. Again, regardless of your own beliefs and agenda, the SPL (by their actions) and the SFA (by their inactions) are not TRUSTED to act as fair brokers.
Lord Nimmo Smith is due to reconvene his enquiry in just over a week’s time. When writing my previous (and quickly deleted) post earlier in the week, my mind was already moving towards (what I consider to be) the insurmountable difficulty the retired High Court judge will face in steering his commission to a logical conclusion.
In football parlance, I fear that the SPL have given him a “hospital pass” that will eventually leave him just as damaged as the game. I had already prepared an outline of why I think his enquiry will ultimately flounder; but, wonder if this topic too will fall foul of the new censorship policy on this blog.
As I think Lord Nimmo Smith’s remit is an important point that needs discussion – and out of respect to those people who have supported this blog as the spiritual successor of RTC – I will attempt to post my thoughts here first. If this post gets removed or doesn’t get past moderation, I’ll do as TSFM (Big Pink?) suggested earlier and find another, more open, forum to engage in.
I apologise in advance for the length of this post; but the points, I think, are fairly straightforward. Please do bear with me.
We should probably start at the SPL Press Release of 12th September 2012:
Independent Commission Preliminary Hearing
The Commission has considered all the preliminary issues raised in the list submitted by Newco and points raised in letters from solicitors acting for Newco and for Oldco. It has decided:
1. The Commission will proceed with its inquiry in the terms of the Notice of Commission and will now set a date for a hearing and give directions.
2. Oldco and Rangers FC, who are named in the Issues contained in the Notice of Commission and alleged to have been in breach of SPL rules, will continue to have the right to appear and be represented at all hearings of the Commission and to make such submissions as they think fit.
3. Newco, as the current owner and operator of Rangers FC, although not alleged by the SPL to have committed any breach of SPL Rules, will also have the right to appear and be represented at all hearings of the Commission and to make such submissions as it thinks fit.
4. Written reasons for this decision will be made available in due course.
Further to the decision made today the Commission make the following procedural orders:
1. We set a date for a hearing to commence on Tuesday 13 November 2012 with continuations from day to day as may be required until Friday 16 November 2012. We will also allocate Tuesday 20 and Wednesday 21 November 2012 as additional dates should any further continuation be required.
2. We direct that the solicitors for The Scottish Premier League Limited lodge any documents, additional to those already lodged, together with an outline argument and a list of witnesses by 4 pm on Friday 19 October 2012.
3. We direct that Oldco, Newco or any other person claiming an interest and wishing to appear and be represented at the hearing give intimation to that effect and lodge any documents together with an outline argument and a list of witnesses, all by 4 pm on Thursday 1 November 2012.
4. We direct that intimation of the aforesaid decision and of these directions be made to the solicitors for Oldco and Newco.
No further comment will be made.
Couple of points worth noting:
1. The Commission will proceed with its inquiry in the terms of the Notice of Commission and will now set a date for a hearing and give directions.
2. Oldco and Rangers FC, who are named in the Issues contained in the Notice of Commission and alleged to have been in breach of SPL rules
So it is clear here that Oldco and Rangers FC have, in the terms of the Notice of Commission, been described as separate entities. It is important to realise that this distinction is made before the commission has had any opportunity to consider the circumstances.
This is a non-negotiable “fact” – as supplied by the SPL – that LNS either accepts or stands aside. He has chosen to accept it.
This “fact” was later given reasoning by way of the Commission’s Statement of Reasons and carried the names of the Commission members:
History
[3] Rangers Football Club was founded in 1872 as an association football club. It was incorporated in 1899 as The Rangers Football Club Limited. In recent years the company’s name was changed to The Rangers Football Club Plc, and it is now called RFC 2012 Plc (in administration). In line with the terminology used in the correspondence between the parties, we shall refer to this company as “Oldco”.
[4] The SPL was incorporated in 1998. Its share capital consists of sixteen shares of £1 each, of which twelve have been issued. Oldco was one of the founding members of the SPL, and remained a member until 3 August 2012 when the members of the SPL approved the registration of a transfer of its share in the SPL to The Dundee Football Club Limited. Each of the twelve members owns and operates an association football club which plays in the Scottish Premier League (“the League”). The club owned and operated by Oldco played in the League from 1998 until 2012 under the name of Rangers Football Club (“Rangers FC”).
…
[33] It is now necessary to quote some of the provisions of the Articles of the SPL. Article 2 contains definitions which, so far as relevant are:
“Club means the undertaking of an association football club which is, for the time being, entitled, in accordance with the Rules, to participate in the League
…
Company means The Scottish Premier League Limited
…
League means the combination of Clubs known as the Scottish Premier League operated by the Company in accordance with the Rules
…
Rules mean the Rules for the time being of the League
…
Share means a share of the Company and Share Capital and Shareholding”.
…
[37] It is also necessary to quote certain of the Rules. Rule I1 provides definitions of various terms in the Rules. Of these, we refer to the following:
Club means an association football club, other than a Candidate Club, which is, for the time being, eligible to participate in the League and, except where the context otherwise requires, includes the owner and operator of such club
…
[46] It will be recalled that in Article 2 “Club” is defined in terms of “the undertaking of an association football club”, and in Rule I1 it is defined in terms of an association football club which is, for the time being, eligible to participate in the League, and includes the owner and operator of such Club. Taking these definitions together, the SPL and its members have provided, by contract, that a Club is an undertaking which is capable of being owned and operated. While it no doubt depends on individual circumstances what exactly is comprised in the undertaking of any particular Club, it would at the least comprise its name, the contracts with its players, its manager and other staff, and its ground, even though these may change from time to time. In common speech a Club is treated as a recognisable entity which is capable of being owned and operated, and which continues in existence despite its transfer to another owner and operator. In legal terms, it appears to us to be no different from any other undertaking which is capable of being carried on, bought and sold. This is not to say that a Club has legal personality, separate from and additional to the legal personality of its owner and operator. We are satisfied that it does not, and Mr McKenzie did not seek to argue otherwise. So a Club cannot, lacking legal personality, enter into a contract by itself. But it can be affected by the contractual obligations of its owner and operator. It is the Club, not its owner and operator, which plays in the League. Under Rule A7.1.1 the Club is bound to comply with all relevant rules. The Rules clearly contemplate the imposition of sanctions upon a Club, in distinction to a sanction imposed upon the owner or operator. That power must continue to apply even if the owner and operator at the time of breach of the Rules has ceased to be a member of the SPL and its undertaking has been transferred to another owner and operator. While there can be no question of subjecting the new owner and operator to sanctions, there are sanctions which could be imposed in terms of the Rules which are capable of affecting the Club as a continuing entity (even though not an entity with legal personality), and which thus might affect the interest of the new owner and operator in it. For these reasons we reject the arguments advanced in paragraphs 2 and 6 of the list of preliminary issues.
Here we were introduced to a few new ideas:
1. That SPL members “own and operate” association football clubs
2. That “Rangers Football Club” was “owned and operated” by Oldco (Rangers Football Club plc).
3. Club means the undertaking of an association football club
4. An “undertaking” is “a recognisable entity which is capable of being owned and operated, and which continues in existence despite its transfer to another owner and operator. “
5. “A Club cannot, lacking legal personality, enter into a contract by itself. “
6. “A Club is an undertaking which is capable of being owned and operated.”
So, the principle, by which Lord Nimmo Smith, purports to connect Oldco and Newco is by the alleged transference of a non-corporate entity between the two owners and operators of the “Club”. The Club is the non-corporate entity he identified as the “undertaking” referred to in Article 2.
However, this is where he gets into some very serious difficulty. It is very strange that – when quoting the relevant articles – the retired High Court Judge did not notice or think the following did not have a part to play.
2. In these Articles:-
2006 Act means the Companies Act 2006 including any statutory modification or re-enactments thereof for the time being in force;
…
4. Unless the context otherwise requires, words or expressions contained in these Articles bear the same meaning as in the 2006 Act but excluding any statutory modification thereof not in force when these Articles or the relevant parts thereof are adopted.
The SPL articles make specific reference to the Companies Act 2006. Specifically “words or expressions contained in these Articles bear the same meaning as in the 2006 Act”
So when the articles refer to “undertaking” we must refer to the 2006 Act to check what meaning we should apply. If we do so, we find:
http://www.legislation.gov.uk/ukpga/2006/46/section/1161
1161Meaning of “undertaking” and related expressions
(1)In the Companies Acts “undertaking” means—
__(a)a body corporate or partnership, or
__(b)an unincorporated association carrying on a trade or business, with or without a view to profit.
(2)In the Companies Acts references to shares—
__(a)in relation to an undertaking with capital but no share capital, are to rights to share in the capital of the undertaking; and
__(b)in relation to an undertaking without capital, are to interests—
____(i)conferring any right to share in the profits or liability to contribute to the losses of the undertaking, or
____(ii)giving rise to an obligation to contribute to the debts or expenses of the undertaking in the event of a winding up.
(3)Other expressions appropriate to companies shall be construed, in relation to an undertaking which is not a company, as references to the corresponding persons, officers, documents or organs, as the case may be, appropriate to undertakings of that description.
This is subject to provision in any specific context providing for the translation of such expressions.
(4)References in the Companies Acts to “fellow subsidiary undertakings” are to undertakings which are subsidiary undertakings of the same parent undertaking but are not parent undertakings or subsidiary undertakings of each other.
(5)In the Companies Acts “group undertaking”, in relation to an undertaking, means an undertaking which is—
__(a)a parent undertaking or subsidiary undertaking of that undertaking, or
__(b)a subsidiary undertaking of any parent undertaking of that undertaking.
Everything that LNS uses to connect Newco to Oldco relies on a Club being a non-corporate entity. Without that interpretation, his original acceptance of the commissions remit would look very foolish. In my opinion, the commission’s statement of Reasons were always poorly framed
Using the 2006 Act – as it appears it is bound to do – I cannot see how any interpretation of “undertaking” can be used in the context of the SPL articles, other than “a body corporate”.
If I am correct and the correct interpretation of an undertaking in this context is “body corporate”, SPL Article 2, specifically (and quite clearly) states that a Club is the company. Since the Club that played in the SPL is in liquidation and the current version of Rangers has never been a member of the SPL, any attempt to sanction the new club for the sins of the old will be laughed out of court.
The real question – for me at least – is why has this ridiculous proposition has been put forward in the first place? Perhaps we can assume that the SPL chose to frame the commission’s remit in this way for purely commercial reasons; but, more worryingly, why have the SFA allowed it to progress?
Cluster One 6th June 10.48
Nothing to do with the “new club” theory.
A rival bid involving Jim McColl, Douglas Park & Walter Smith was the preferred option.
There is no hearing tomorrow in the BDO v RFC 2012 case, btw.
On Tuesday, some ‘property experts’ are scheduled to give their evidence.
I suspect that their stuff will be as boringly ‘technical ‘as that of the brand valuers last week.
I ‘ll tune in if I can .
The difficulty I have is that to my ears, the max volume on my phone speaker is not loud enough to listen to without strain unless I’ve got the phone jammed to my ear.
If I leave it lying on the table beside me when I’m making notes, any other noise, like the kettle going on, or wife going in and out or opening cupboards , or the landline phone ringing, causes me to miss what’s being said.
And to try and hold the feckin thing to my ear for any kind of length of time brings its own problems.
Any advance on putting the phone in a coffee mug, speaker end up, placed near my favourite left ear as I listen and try to scribble?
If the ‘virtual’ links are poor or if the particular speakers speak rapidly, or disjointedly, or are long-winded or sit too far from their own device or what-not, and all the rest of it, it’s quite easy sometimes to miss several questions/answers in a row.
This afternoon Mrs C and I went down to Selkirk .I’m kind of embarrassed to say that we had never before been there. It’s only about 40 miles from Edinburgh!
Very interesting place, which includes the Court wherein Sir Walter Scott ‘dispensed justice’ as a Sheriff.
On the way back up the road, we turned in to have a gander at Abbotsford, which was yer man’s house.
What an honourable man!
In the days before the kind of charlatans that the ‘saga’ has exposed to us in recent years had dreamed up the concept of ‘limited liability’ and passed it into law so that rogues could dodge their debts by saying ‘it’s the company’s debts, not mine’ , he refused to avoid the shame of bankruptcy.
And worked to pay off his debts ( c.£10 million in today’s terms) by his writing, and by selling the rights to his tremendously successful novels and other literary work.
Oh, what it must be , to be the kind of cheat that causes a football club to die, having shafted it right left and centre for more than a decade, lining your own pockets while piling debt on it!
Must make you feel great, eh?
But, oh, what must it be like to be leeches who latch onto the cheating in order to profit from it?
Or, worse, to be a member of a governance body which endorses cheating?
Sir Walter Scott’s shade will doubtless agree with me that being in either category marks a man as being not even worth a well-aimed spit of contempt.
John Clark 6th June 2021 At 22:25
“Any advance on putting the phone in a coffee mug, speaker end up, placed near my favourite left ear as I listen and try to scribble?”
John, did your phone perhaps come with a small set of earphones? I think I have a set in the box my phone came with although I’ve never used them. Otherwise, depending on the type / age of the phone you might find any set of headphones, if you have any lying around, will do the same job. Just a thought!
Can I also add please add my appreciation for all the hard work you do for us in following these cases. I for one am very grateful to you.
Mordecai 7th June 2021 At 05:47
‘..did your phone perhaps come with a small set of earphones.’
“”””””””””””””””””””””””
Now there’s a thought! I know I’ve seen earphones lying around somewhere in the house, that I used with my language learning cds .
I shall forthwith institute a search for them in the usual dumping places-the attic and the garage.
Thank you for the suggestion.
John Clark 7th June 2021 At 09:20
Come into the modern world , JC , and buy yourself a pair of earbuds . You can get them online for not more than a fiver and you can listen remotely to your phone (10ft anyway) .
https://twitter.com/BBCchrismclaug/status/1401910547696730112/photo/1
……………………….
Mr Ahmad gets his letter of Apology june 7, 2021
Part of the problem for John C and others following court cases, is that it is explicitly forbidden to record proceedings and transcribe them later.
In this D&P case, the judge actually mentioned doing the trial that he was aware that this practice was in place amongst ‘certain bloggers’.
Scarily, we were approached by the court a day or so after the judges remarks, and we were reminded of our obligations.
I telephoned the court in reply and made it very clear how we were reporting, and assured the court that we were absolutely not recording the proceedings.
It is though a reminder that there is a fine line to tread when reporting on, or commenting upon such cases.
The recent contempt trial of Craig Murray is a good example of how you can find yourself in trouble easily. Working within these restrictions is a challenge, and John deserves great credit for his efforts as well as our gratitude.
So the Scottish taxpayer will now have to foot the bill for many more millions for another two men who were maliciously prosecuted. That’s four in total. If we (the taxpayers) are not going to get an apology for OUR money being wasted on this pursuit of innocent men, then the least we should expect is an explanation of why it happened. What was their end game? Given that so far no-one has even tried to explain what went on then in my view we are entitled to wonder if the end game was to save the name of ‘Rangers’, even if that meant innocent people going to prison. If that’s not the case, then they need to explain exactly what it was. It truly is shocking, and I am amazed that the media are not making a massive issue of it…well actually I’m not amazed. Not asking questions if you might not like the answers and all that!
Royal Mail ‘track and trace’ tell me that my letter to the Master of the Rolls was delivered today.
The question now arises:
a) will it be ignored completely?
b) will receipt of it even be ‘acknowledged’?
c) will it be replied to with a ‘ thank you for your letter but the Master has no observation to make about any Court judgment’
d) will it be acknowledged courteously with the suggestion that I refer to the SFA on whose judgment and statements Counsel in the case, and the Courts ,relied?
e)will it be acknowledged with a letter saying ‘hmm, I see your point. Let me look into it?’
Will my letter even be seen by Sir Geoffrey Vos?
Hard to say.
A hand written address on the envelope? Would it be opened in the general post-room? or passed up the line in case it was ‘personal’? Are there ‘liquidation deniers’ in the post-room of the English Royal Courts of Justice? Or further up?
We await with bated breath..
@UTH – personally it increasingly feels to me that there should be an independent review. Obviously the Lord Advocate’s Office cannot be involved. Personally I think the CPS in England and Wales should be asked to lead this review – not holding my breath that our First Minister will ask the CPS to help though…
Court proceedings over for the day at, 2,45.
3 property experts giving evidence relating to the range of realistic property advice options that might have been considered by the Joint Administrators.
Court adjourned till 10.00 a.m tomorrow
Wokingcelt 8th June 2021 At 09:38
@UTH – personally it increasingly feels to me that there should be an independent review. Obviously the Lord Advocate’s Office cannot be involved. Personally I think the CPS in England and Wales should be asked to lead this review – not holding my breath that our First Minister will ask the CPS to help though…
+++++++++++++++++++++++
I doubt that the FM will ask anyone from the English and Welsh CPS for help. However, a non-Scottish Judge to lead an inquiry is a must in my opinion. This simply can’t be overlooked, but I’m not sure it is possible for a Scottish led investigation to be truly independent. At face value in this case the establishment in Scotland would circle the wagons in my view.
@JC
They could have got 20m from Tesco , retained the main stand facade as the basis for offices or even a museum sold off the seats , turf, floodlights and goalposts to football fans(or other clubs) demolished the 3 other stands and recouped some costs from the scrap . To allow Green to buy it for 1.5m was scandalous.
There was no need for Sevco to play there (they could have sought to groundshare at Hampden or Firhill) unless of course they needed the stadium to carry on the same club* pretence . Of course if Green’s plan had collapsed because the fans failed to back it (which they were doing) then Green could have then initiated the above to ensure he made a large profit at the expense of the creditors.
Now Green is sitting waiting for millions in compensation , Whyte has the film rights, Sir Dupe still has his title and not one penny of this unlawful tax scam has been recovered.
Upthehoops 8th June 2021 At 16:29
‘..However, a non-Scottish Judge to lead an inquiry is a must in my opinion…’
++++++++++++++++++
What I wonder is whether the Westminster Parliament /UK Government has any power to set up an inquiry into the operation of the Scottish judicial system? That is, is the Crown Office and Procurator Fiscal Service answerable to Westminster/Downing Street, or ONLY to the Scottish Government and people?
If it is answerable only to Holyrood and if the Scottish Government decides that a public enquiry is called for I cannot imagine that they would countenance using an English judge to head it.
On a separate but connected point, I gather that the budget for the COPFS for 2021/22 is about £156 Million. Damages already agreed plus the amounts likely to be claimed by others who were wrongfully arrested/ held in custody over the unfathomable and mysterious cock-up of a prosecution will make a bloody big hole in that!
Back in 2012, my working assumption was that Charles Green (and Craig Whyte before him) would have no interest in actually running a football club.
It appeared to me then – and still does today – that if there is money to be made in football, it would be in the bricks and mortar.
In 2005, Bournemouth sold the freehold of its fourteen thousand stadium to a property company in a sale-and-leaseback deal.
Bournemouth received £3.5m and agreed to pay around £300k a year in rent.
Manchester City (capacity 55k) pay around £4.4m annually to lease the Etihad Stadium from the local council.
Newcastle, Chelsea and others all rent their stadia from 3rd parties.
While the stadia are of a similar size, I doubt – due to the different financial landscapes – if Ibrox and the Etihad would be closely matched in value. Nevertheless, if the current inhabitants were looking to sell and leaseback Ibrox, it wouldn’t surprise me if they could raise around £20/£25m for something like a £2.5/£3m rent.
It has always puzzled me why Duff and Phelps did not look to market the stadium and training ground separately from the remaining assets. They may not have achieved ‘top dollar’ from a liquidation sale; but, a shrewd speculator would have the safety net of the basic property values if the new football club did not survive into the long term. To my mind at least £12/£15m should have been easily achievable – if sold with a rental agreement in place to the purchaser of the Rangers trademarks.
Breaking up the assets would not necessarily have meant the end of football at Ibrox – but it surely would have resulted in a better deal for the old club’s creditors.
https://www.heraldscotland.com/news/19358596.rangers-administrators-criticised-not-selling-off-ibrox-part-club-break-up-sale/
……………
LIQUIDATORS of Rangers suggest Ibrox and Murray Park training ground should have been sold off separately when the club went into administration after it emerged they ended up being bought for just £1.5m.
An expert for Rangers oldco liquidators BDO says that a sale and leaseback of the iconic club assets should have been pursued. It would have raised millions more for the club which under Craig Whyte financially collapsed nine years ago.
Albertz11 Nothing to do with rival bid by walter smith jim McColl and douglas park as they walked away in june 19. Only 250 season tickets were sold by july 6. Fans did not want to follow what they knew was a new club until Green served cups of tea a d Ally was claiming still the same club. Don’t try and convince me otherwise, as someone who sat with ibrox friends and said they would not follow the new club and were not buying a season ticket
Cluster One @13.32
And in addition to the efforts of Mr Charles and Mr McCoist the stunning volte-face by the entire SMSM ensured that season books were sold and the ground work laid for the IPO.
Albertz11
Simple question, out of idle curiosity,..
Would you consider the outfit currently operating within the state of Govania to be the same club as the one which was consigned to liquidation in 2012 once the legal process is completed?
A short, simple answer will suffice.
I was also thinking – whatever became of reasonablechap (RC) ?
I find Dave King’s comments on Malcolm Murray quite interesting, almost like they were spoken with tongue well and truly placed in cheek. King bemoans the actions of Murray but didn’t that group have the club within months of being in a break even position, an area that is and was quite foreign to whatever entity is/was operating out of Ibrox. With King at the helm the losses soared and even as his stepped aside him hand was on the tiller for a number of years. Pot kettle black comes to mind.
If Billy Gilmour had not been involved in Ranger’s youth set up would he be garnering all the press currently and during the past season being lavished on him. Has anyone done any in-depth look at his playing time at Chelsea of is the thinnest of Ranger’s connection leading to elevation as a star.
@Vernallen – re Billy Gilmour. No doubt the young man is seriously talented. He is getting game time in a Chelsea team that are Champions League winners and probably since turn of the year most consistent team in England (with City). He has the potential (which doesn’t guarantee anything of course) to be one of the break-out stars in the EPL next season. The Euros may just be a season too soon for him to really shine.
Bect67 9th June 15.14.
Yes.
@wokingcelt – re Gilmour . Granted he is getting Chelsea game time but predominantly the starts are in “dead rubbers” and the appearance as sub have mainly been when the game or tie are beyond doubt. Very much the approach of keeping a fringe player sweet even if that does suggest one they want to keep as backup.
SPFL announce new sponsorship deal.
https://www.bbc.co.uk/sport/football/57426594
Not linked to gambling or alcohol is a positive i suppose.
@Tykebhoy – his game time and profile of matches is following a similar trajectory to that of Phil Foden at Man City (1 year his senior). It’s unlikely that Foden would have made the English Euros squad if it had been played last summer. Of course lots of young players don’t “train on” (to use a horse racing term for two year olds as they move up) and time will tell.
(Ps – it’s Gilmour’s birthday tomorrow…I expect the DR to send him a birthday cake…)
https://find-and-update.company-information.service.gov.uk/company/SC425159/charges/Cx1BDOpVbXMd0e-QL_eZt-E3HGA
charge for The Scottish Sports Council Trading as Sportscotland was satisfied yesterday
The 3 charges giving security to Close Leasing remain.
Does this satisfaction of charge now allow them to raise funding using the training ground as security ?
BDO case: all evidence now gathered, Counsels’ submissions to be with the judge by 5.00 p.m on wednesday 16th june for judge to study and arrive at at his judgment and write it up on Thursday 17th.
Court adjourned until Friday 10.00 a.m.
Timtim 10th June 2021 At 13:28
‘..charge for The Scottish Sports Council Trading as Sportscotland was satisfied yesterday’
+++++++++++++++++++++
There was something about the the Sports Council suddenly realising in 2015 (?) that the Rangers to which they had loaned money [on the back of a ‘charge ‘ on Murray Park ] had gone into liquidation in 2012 and that TRFC Ltd could have refused t o repay on the grounds that it wasn’t their debt,. ?
..Whatever, there was a necessary ‘transfer of original contracts of award’ agreement , which made TRFC liable.
Otherwise we (the Scottish taxpayer) might well have have been f***ed again by the club that cheated us out of many millions
John Clark 10th June 2021 At 19:04
I have always thought there was a story about Murray Park that is worth looking into. It was built at the behest of Dick Advocaat at a time the Bank of Scotland were almost giving Rangers a blank chequebook. The much trumpeted cost was £14m, and very soon after Rangers debt rose to £80m, of which David Murray transferred £50m to another part of his group to bring the football debt down. As we know David Murray’s group had many millions written off by BOS, who in turn received massive taxpayer funding like other banks. My question is was Murray Park ever payed for and has the taxpayer picked up the bill for it? Let’s face it, the de-facto position seems to be that the taxpayer had to fund the previous Rangers anyway.
I have had several Rangers fans say to me how much better Murray Park is to Celtic’s training ground. My answer always is that Celtic paid for their ground with their own money, but that always seems lost on them. Sadly we are now seeing through the courts a challenge as to why Murray Park wasn’t sold to pay off creditors. Let’s not forget either that the Bank who gave Rangers money to build Murray Park, did all in its power to end Celtic for good, for a debt less than half of what Murray Park cost.
Albertz11 9th June 2021 At 14:33
Fears over Charles Greens ownership
………………………
There was no fear of ownership as Green had a binding agreement in place with the administrators. As of june 14 everything belonged to Green, it was his assets to do with what he pleased.
………………………
Assurances were sought by two of the unsuccessful consortiums that in exchange for certain conditions being met they would then in meetings with supporters representatives encourage the purchasing of Season Tickets.
……
The assets at ibrox and murray park were nothing to do with them, they could have had all the meetings they wanted.
Green told the consortium on june the 15 give me £20 and it is yours, they never did Green also assured the fans he would not sack Ally.
The consortium were told on 17 by Malcolm Murray nothing was for a quick sale the intention was to rebuild rangers.
The RFFF after a meeting with Green and Murray on june 20 put out a statement encouraging fans to buy season tickets.Green also released a statement encouraging fans to buy season tickets claiming ST Money would be ring fenced.
Still by july 6 only 250 fans wanted to follow the new club.
Here ends the history lesson
I’m happy to report that I have received an acknowledgement from the Assistant private secretary to the Master of the Rolls ( Full marks for traditional courtesy and quick response! ]
The letter reads:
“Dear ….(me),
Thank you for your letter dated 4th June 2021 addressed to the Master of the Rolls which was received by this office on 9th June 2021.
The Master of the Rolls has asked me to pass your letter to the constituition who heard the appeal and I have done that today.
Yours sincerely,
A C”
An interesting wee touch: just as I used pen and ink to address my letter, the address on the acknowledgement is handwritten.
Now, I’m not exactly holding my breath; however , even if the Master merely said to the presiding judge , ” Hey, Nick, have a look at this when you get the chance, and let me know if there’s anything in it?” that’ll be something. At least two judges will know that at least one person believes the Court put its name to an error!!
Cluster One 11th June 15.13
I’m well aware of the timeline of events back in June/July 2012 so no history lesson required from yourself.
Do you honestly believe that what Charles Green said in public was the same as what was said in private?.
Only 250-300 Season Tickets had been processed before they were suspended as talks continued in private.
Reassurances were eventually given leading to 38228 being sold.
Completely off topic, but just watched BBC News re G7 with the Queen visiting. Two observations:
1. What a class act Elizabeth Windsor is (and I say this as a died in the wool republican).
2. Joe Biden – another class act. Others crowding the Queen, he stands back in recognition of his democratic status.
Cluster One 11th June 2021 At 15:13
‘…Still by july 6 only 250 fans wanted to follow the new club.’
++++++++++++++++
Like the SMSM and the SFA and the SPL, the generality of the fans KNEW that RFC of 1872 was no more, that it was as dead in Liquidation as Gretna and Third Lanark.
In my view, those who had purchased some, but not all, of the assets [because they were not buying the whole club, debts and all] for buttons, must have had some assurance from authoritative quarters ( to whom had they spoken, one wonders!?] that ‘continuity’ as Rangers of 1872 was guaranteed!
And made sure that the SMSM very quickly bought into the notion that it was the ‘holding company’ that entered Liquidation
If there was a ‘holding company’ it was Wavetower, now the Rangers FC Group ,that would have entered Liquidation,
But, of course, the Rangers FC Group [previously Wavetower, ]is still alive and is NOT in Liquidation or dissolved [although presently dormant]
As an actual, indisputable fact, the entity in Liquidation is the RFC of 1872 .
[as I ventured to tell the Master of the Rolls… I will be astonished if their Lordships to whom the Master has referred that statement of mine , will be able to contradict it.
At the very least, hope I have given them a problem, not least in having to question what was told to them in Court as background to the case which they were hearing.
I would further hope that if they accept that my statement is true, they will acknowledge that fact.]
The 5-way Agreement , I imagine, gave SevcoScotland/TRFC/RIFC plc some comfort in that the SFA and SFL were prepared[ deceitfully, in my opinion] to allow them to CLAIM that they were simply the new owners of a 140 year old club that was the most successful club in the world, and not mere applicants for a share in a League ,and for first time membership of the SFA.
That emboldened them to put that claim in the Prospectus for the IPO : who would want to buy shares in a newly created football club?
I personally think that claim to be entirely unjustified and extremely questionable.
And I think I know in my heart that the Liquidation of RFC of 1872 is acknowledged quietly in the hearts of those who , credit to them, buy season tickets to watch a new club for wishful reasons related to emotion rather than reality.
The fans of other clubs which entered Administration had Insolvency Practitioners who managed to save them from entering Liquidation.
Unfortunately for the fans of RFC of 1872 , the Administrators of such a debt-laden football club were unable to save it .
It died the death of Liquidation.
The SFA and SPFL should come clean and acknowledge that fact.
And then we can all ‘move on’.
It’s that time to dish out the Knighthoods, Damehoods, MBE’s, OBE’s again. Personally I totally object to the honours system. So much of what is handed out is totally undeserved, including to ‘ordinary’ people. It’s farcical in my view.
Once again I am left to question why a man who implemented an illegal tax avoidance scheme which cheated the state out of tens of millions gets to keep his Knighthood? Not only did he do that, much of the rest of his business also went bust leaving many out of pocket.
Yet STILL the Scottish Media fall over themselves to address him as ‘Sir’ David, and frequently regale the successes his tax cheating brought. You really couldn’t make it up, and in my opinion shows that the media would not care how ‘Rangers’ achieve success, as long as they achieve it. Surely a media properly doing their job would have campaigned long and hard for his Knighthood to be rescinded, instead of celebrating what he did. Incredible.
Albertz11 11th June 2021 At 20:39
Reassurances were eventually given leading to 38228 being sold.
………………………
Reassurance that he would not sell the stadium and season ticket money would be ring fenced and he would not sack Ally. Does not take away the fact that only 250 fans bought into the new club in the first place and did not require reassurance of anything.
Now that all the evidence in the BDO damages claim against the D&P Administrators is in, and the decision of the Judge in the case cannot be in the least affected by anything I say, I’m happy to give you as much as I have been able to type up of the last day of evidence giving.
Remember that I have heard only some of the virtual hearings, and that while I try[faithfully ]to capture the guts of what the protagonists say in the words that they use, I don’t claim to be a Judith [ that’s the name of the official court reporter.] I heard her voice saying ” that’s us live, m’Lord’
“BDO v RFC 2012 plc Day 20.
9 June 2021
Lord Tyre: Good morning Mr Christie and Mr Blucher. [then followed the usual questions about whether they’re alone, mobiles on silent, have arranged not to be disturbed, and the swearing-in [ with one of the witnesses being asked to use his other right hand!] Then:
Mr McBrearty: M’Lord there is one preliminary matter I wish to raise. I have an objection to Mr Blucher giving evidence. I’ll explain it now if you wish ,but I don’t want to hold things up..
Lord Tyre: Yes, I’ve noted your objection , and you can proceed subject to that reservation.
Mr McBrearty, QC: Mr Christie, [ he then asked the witness to confirm name, age,address and occupation ; and that his expert report, supplementry report and a joint report agreed by him and shown on screen had been signed by him and that he he was content to have them stand , subject to anything he may wish to add today]
Lord Tyre: Mr Young?
Mr Young QC: Mr Blucher, [ then the same confirmation of name etc etc] Then: Mr Blucher, if we look at p148 of your first report, and p.149, we see in your CV “ experience in advising on insolvenct procedures for football clubs, for example Oxford United, Millwall, Bradford, Swindon Town…Could you tell us about that experience, about common features..?
Blucher: Yes, there were several common themes, redundancy, cost-cutting, football regulatory matters…
QC: Tottenham Hotspur?…Club for sale?
B: Yes, I was vice-chairman and CEO.
QC: How did that sale process turn out in terms of difficulty?
B: It was very difficult, because in 1991 the company owed about £10 million pounds to the bank, who were insisting on payment, serious enough money then. I spoke to the Administrators , there was no !0 million available. And there huge dispute about selling Paul Gascoigne for £8 million.We were able to market the business for sale. There were all sorts of bidders who didn’t have the money. It was not until Alan Sugar, Lord Sugar as he became, came through the door was a deal done.
QC: Can you say how many false bidders there were?
B: There was probably only 3 or 4 or 5 real bidders, and something like 35 or so false bidders.
QC: [ now addressing Mr Christie]
Mr Christie, on the subject of player redundancies, in your report you refer to wage ‘deferrls’ and wage ‘ waivers’, and say that ‘waivers’ are more attractive?
C: Yes. ‘Waivers ‘ take th cost of the wages out.
QC: Wage deferrals significant?
C: Yes
QC: [instructing Mr Hyde, who was operating the projection of documents on screen] Let’s look at the Joint Minute, please….. So, in the second joint minute, in the last table ‘marketable players’.. I’m not quite seeing how to..
C:.. there’s headings at the top if…
QC: Ah, yes…These 10 players , were paid £608,000 for three months.. The 4th column , £1.7 million, if there is no ‘waiver’.. So, if there had been ‘deferrals’ a million pounds would have to have been picked up by the new owners. Mr Christie can I ask if you have seen or heard any of the evidence in this case?
C: I’ve seen some transcripts..
QC: Let’s look at the Hearts administration, in Joint bundle 5, 6036 para 6.2, . In the context of the heart administration, the SPFL required satisfaction of the football debts. Have you seen this?
C: Yes. The point you’re making is that liability should be paid.
QC: If you make players voluntarily redundant is that not a deferral?
C: If depends on whether it’s a definite or possible liability.
QC: Could you explain?
C: well, can the liability be passed on to a purchaser.?
QC: The Administrators of Hearts talk about the purchaser having to satisfy football debt.
C: The wording….
QC: If there is a definite liability on the purchaser, is voluntary redundancy the equivalent of wage ‘deferral’?
C: Yes.
QC: Isn’t it even worse, because you lose their services?
C: There’s certainly an argument to that effect.
QC: Please look at your Supplementary Report at 272 para (d) “ Buchler’s comments did make ‘waiver’ attractive….purchaser would have no obligation …” Would you agree that if there was a football creditor rule requiring the purchaser to pick up liability for football debt..
C: If Court found that a purchaser was liable . But by making redundancies your reducing the amount…
QC: But ..[ed: I missed what he said]
C: That’s a valid point.
QC: Did you discuss the football creditor rue with Mr Pethybridge ?
C: No.
QC: f we look at your first Report,on page 28, th table at 6.11 .Your summary is that £2.7 saved over a 2 month period.On page 275 in your Suplementary report at 5.3 you finesse that to £2.8 million, with employers’ National insurance contributions.
C: I factor in bonuses and the way NICs re calculated.
QC: [ed: misseed what he said]
C: I think that’s correct.
QC: The list of non-playing staff. …immediate redundancies 4 months salaries that were paid , £955,623.The next table shows the players proposed for redundancy , 4 months period, nd at the top ‘ salaries …basic…. NIC…’ A total £1.4 million saved.
C: That’s based on what they were actually paid..
Mr McBrearty: Objection!. M’Lord, what does this document show?
Mr Young: I’m trying to show, m’Lord, the comparison between ‘wage waiver’ and redundancies.
Lord Tyre: Not a fair comparison..?
Mr Yung: I’ll come back to that.
Lord Tyre: Yes, you may want to discuss with Mr McBrearty.
Mr Young: Mr Christie, at 6033 p 38 of your report you say “ regardless of….” Is it your understanding that the Administrators were prevented from selling players because..[ ed: missed it]
C: Could you repeat the question, please?
QC: [ed: missed it again]
C: No, I’m not suggesting that a ‘waiver’ prevented prevented sale.
QC: Your proposal is that redundancies would be better?
C: Well, if you’re cutting costs and selling players that’s an attractive way of [ed: I can’t read the next two words!]
QC: But isn’t there an element of uncertainty of sales?
C: [ed: missed what he said]
QC: Wage ‘waiver ‘ don’t prevent further waivers?
C : But that was never considereed to be realistic.
QC: Mr Buchler, have you anything to say?
B: Redundandcy as a policy causes huge problems, requires delicacy in handling combined with something to give players comfort, and compassion..
QC: Mr Christie, anything to say in response?
C: I would not dispute that compassion is needed, but I don’t agree that you cannt make redundancies.
QC:It’s a judgment call as to how to save money?
C: It’s combination of how to save money and making the business attractive to buyers.
QC: but there are drawbacks in making redundancies?
C: There are also drawbacks if you use ‘waivers’.
QC: It’s a judgment call. The Joint Administrators’ approach was reasonable.
C I don’t agree.
QC: On page 31 of your first report , at para 16 you talk about immediate redundancy programme. [ed: I missed the tail end of what he said]
C: [ed: I missed what he replied]
QC: You refer to Portsmouth… your experience in football clubs is limited to Queens Park. When was that?
C: About 1999 or 2000.
QC: At a time when players were amateurs?
C: Yes.
QC: In the context did the Administrators make redundancies?
C: Yes.
QC: “ para 1166……So, under cash flow Staff ( non-playing)
para 1167…..imperative to sell players
para 1168….some player are sold
para 1169…compromise agreements with the following players, 6 agreed to leave.
Payments £230,000..” That doesn’t seem to be a widespread redundancy programme? Is that not different from what you are saying is normal?
C: I’d need to check..
QC: You’re suggesting that the normal practice is redundancy, players let go. Your comments?
C : In principle a redundancy programme would be normal.
QC : Where does your evidence come from?
C: there are clubs not mentioned.
QC: Page 32 of you report, your suggestion here is that maybe redundancies were the best way to go?
C: You take action at the start and the situation develops.
QC: Once the bidders came in there was……[ed: missed what he said]
C: [ed: missed his opening words]..if there had not been an agreement not to make further redundancies.
QC: On page [ed: didn’t hear the number] Indicative bid from Bill Miller , .p 976 (5) bullet point 4
“ all relevant players and key coaching staff transfer to his company [ed: then I have what looks like ‘cond 8’ ….Bill Miller is saying ‘I want key players and staff, and want to know the fabric of the team’
C: It’s not saying the squad as it is today, but only to meet the obligation of fixtures
QC: [ed: all I have here is.] .. evidence of Singapore consortium……recall?
C: No.
QC: Whilst none of the bidders may not have expressed that particular players be retained, some bidders would drop out..
C: I don’t see the two things as inconsistent
QC: You talk about indicative…?
C: illustrative
QC: yes, illustrative list of players. How’d you decide?
C: An initial view on how many players in each position, and their value. If a player is on a huge wage but is of no value he’d be on my list of redundancies.
QC: Did you take account of contracts?
C: Not at that time.
QC: But if players were going to leave?
C: That’s a point.
QC: Why did you not consider it?
C: I just didn’t.
QC: What about the rules relating to under 19s?
C: I didn’t specifically consider that.
QC: Did you consider it at all?
C: No
C: So you just needed to complete the season?
QC: And next season?
C: That would be for the purchasers
QC If the club was not able to register players?
C: That was a [ed: didn’t hear him]
QC: Mr Christie, damages in this action are claimed in relation to the list of players. Did you not consider in your supplementary report that the Administration was likely to continue into the following season? Did it occur to you?
C: I can’t say specifically
QC: did you not consider the need to look again at your list
C: No, that would be at the edge.
QC: Your list. Once Administrators go into a club don’t they speak to the football Authorities about redundancies, the under 19s?
C: There’s a huge number of considerations.
QC: Is it not optimistic to suppose that going down those routes you’e going to be able to make those redundancies?
C: Well, most insolvencies are difficult.
QC : In respect of staff redundancies your list is not based on what the individuals did.You didn’t look at the business case for making each redundant?
C: No.
QC: Jackie Gourlay, Ken Olverman …. did you speak to them about their jobs?
C: No. I didn’t consider that as an option.
QC: You have no idea whether the business could operate without [ ed: I have no note of any further words that finished the sentence, but I have no ‘full stop’ or dots .He may have finished, but maybe he just stopped there. ]
C: That’s unfair. You look at the obvious things , Youth Development and such… others are more difficult, need refinement
QC: ‘Football in the Community’… Were you aware that that earned income?
C: No.I would have expected something from the Administrators
QC: If you didn’t look into it, you are not in position to say it should be cut
C: illustrative [ ed: that’s the only word I see in my notes. I assume that that was my understanding of the gist of his reply?]
QC: Why didn’t you discuss with Mr Dickson?
C: I was not aware I was able to.
QC: Were you aware that the Scouting Operation was funded by the fans?
C:….I read something about it.
QC: document p 1184 .. email 19 February 2012 “ SJ spoke openly …..JG could easily do Ally Russell’s job..” This is within the bundle. It’s some evidence that JG was highly regarded.
C: You could argue on various individuals.
QC: I’m looking at what you could have done. … Ken Olverman, look at the documents and consider the importance of his role?
C: That’s a possibility that that might have been ..
QC: You simply divided up? [ed: here I have a wee scribble of my own to remind myself; ‘damages being claimed point’]
C; That’s why it’s illustrative not final.
++++++++++++++
Geez, it’s taken me an age to type this much! Christies evidence goes on for several more pages, before we get to Blucher.
I have earlier stuff to type up of course, and I’ll do that as and when.
But again I have to say that I have not heard all the evidence, and that it’s entirely possible that I may have mis-heard, or misunderstood the context of the hearings that I heard.
Basically I just want to give a flavour of the court proceedings.
This might (probably will) come back and bite me on the bum… but having watched England-Croatia today I am a wee bit more confident about Friday (especially if England stick with the same team). One game at a time though – any sort of win tomorrow will do just grand!
My post of 12th June 2021 At 23:53
For anyone interested, this is a continuation of my notes of the evidence-giving session of Mr Christie.
“Continuation of day 20 [9 June 2021]of the virtual hearing in the BDO v RFC 2012 plc case’
“QC: The table on page [ed: missed the number], a list of possible redundancies drawn up by Jacqui Gourlay. You put Goodall on the same list as ..[ed: didn’t catch the name] Why was that?
C: I couldn’t say.
QC: Joint Bundle , vol 2 p 4779, email on 9 March …?
C: I’m not sure it’s the same…..different salaries?
QC: There is a reference in the Joint report…We’ll leave it there for the moment.[ed: he asked another question only one word of which I heard, ‘optimistic”]
C: Not optimistic. You’ve got to move quickly.
QC: Mr Manning assumed redundancies before March, not February?
C: Payroll and wages were the biggest costs though.
QC: Let me ask Mr Blucher about the relevance of that schedule.
B: [silence]
Lord Tyre: I’m not hearing you, Mr Blucher. Perhaps if you drew a little nearer to your microphone?
B: [presumably adjusting] Apologies, m’Lord. I do agree with Gordon, the early days are particularly difficult. One thing is that the most important aspect is that there is regulatory interest in every case by the authorities- match days securities, crowds, tickets ,very time- and people-consuming to keep your people. It’s difficult to cut staff immediately because you might have difficulty in meeting the regulatory requirements.
Christie: But you would have two teams looking at regulations etc before you finally decide.
Mr Young: M’Lord, would now be good time for the break?
Lord Tyre: Yes. We’ll break now, and resume at ten to twelve.
[Court rose for ten minutes or so]
On resumption,
Lord Tyre: Mr Young?
Mr Young QC: thank you , m’Lord. Now, Mr Christie, in the matter of player sales there seems to be two main points where you disagree with the Respondents. The first is on the lack of independent advice obtained by the Joint Administrators. The second is on the absence of a pro-active policy?
C: Yes: and a third is the lack of completion of the sale of Naismith.
QC: Let’s just focus on the pro-active policy lack. Can we agree that the Joint Administrators did not set their faces against transfers?
C: That’s probably fair enough.
QC: Discussion with clubs in China, Norway, and Blackpool about Fleck, for example?
C; [ed: I did not catch his words]
QC: Your view is based on?
C: My view is based on insolvencies generally. If you have surpluses that you don’t neeed, you would sell.
QC: Can I ask Mr Blucher for his view?
B: Every case is different. The Administrators have to consider carefully what their strategy should be. Every case as I say is different. The challenges are different. Redundancies always ? No. Waivers? Deferrals?..
QC: In relation to player transfers, Mr Christie has no personal experience but says he can read across from general insolvencies. Does this apply to Football Clubs?
B: They’re fairly unique. In terms of players transfers, Rangers would have its unique circumstances, with the transfer window closed.
QC: Mr Christie, one of your touchstones is Portsmouth. If we look in the Joint Bundle vol 1, p1168, in the second paragraph : ‘ the Premier league opened the window early.’ From your report you say Portsmouth created an organisation to try to sell players but despite that it was a while before a sale?
C: The achievability of football sales I beyond my expertise.
QC: But would you still be suggesting negligence if there is no pro-active policy?
C: Yes.
QC: But if having or not having a pro-active policy had no effect would you still consider it negligent?
C: Yes
QC: There would be expense incurred?
C: You could appoint an agent ,paid on commission
QC: Mr Blucher, would you have a view, on negligent?
B: I’m not sure I have a view on that..
QC: Mr Christie, on the subject of Steven Naismith..page 273 of your Supplementary report, sub-para (h) [ed: that might have been ‘8’] You say it was ‘irrational’ not to sell Naismith. Is it right that you think buy-out clauses should not have been put in?
C: Yes
QC: Because the purchaser woud offer less?
C: Yes, because it wasn’t linked to ‘waivers’ but was a permanent change.
QC: Isn’t it rational to seek at least the buy-out clause price?
C: [ed: I didn’t hear his response]
QC: The £2.75 million allocated by Sevco to the playing squad- was that a fair price for the contracts?
C: Unless the interested parties [ed: I missed the rest of his reply, and the next exchange]
QC ——?
C: —–
QC: Moving on to talk about the ‘brand’. You’ve not had to deal with seeking a football club valuation?
C: Correct.
QC: Did you look at the Leicester City or [ed: I missed the name of th club]
C: No
QC: Did you go down the route of looking at other instances?
C: No, I’m just generally aware of others.
QC: You didn’t look at how the Liquidators looked at brand valuation?
C: The fact that it was done in other cases doesn’t mean that it was appropriate in Rangers case.
QC: But wouldn’t you expect brand valuations of other clubs?
C: You’ve confirmed that the Rangers situation was different.
QC: [ ed: I caught only the words ‘in-house valuation’..]
C: [ed: I caught something like ‘ there would only be objectivity if out-of-house’]
QC: Didn’t Hearts think it worthwhile?
C: Cases are unique.
QC: On the question of fault, others had looked over things before you?
C: Yes
QC: BDO itself reported?
C: Yes
QC: Mr Manning?
C: Yes.
QC: You had Manning’s and BDO’s reports in August 2020?
C: Yes
QC: Are you the first to mention ‘fault’?
C: I was asked to look at it.
QC: Did you have the brand valuation reports?
C: I think I may have seen a draft
QC: If we look at pages 93, 94 of the Experts Bundle………there’s the draft report from Mr Forbes, then the final report on page 96. The reason why you come to a diferent view may be that you already had the report of valuation by Mr Forbes, you were triggered by that report?
C: I’m not sure what you mean by ‘triggered’……I was asked to look ..
QC: At para 11.8 page 76, you describe ‘normal practice’ …?
C: In any insolvency if you think you have an asset of value you would get it valued. I don’t think I was ‘triggered’….Just normal practice.
QC: Can I ask Mr Blucher?
C: I don’t know of any football case I’ve been involved in where there was a brand evaluation.
QC: Mr Christie, Mr Forbes states that it would take 6 to 12 months to market the brand. Do you say that the Joint Administrators should have taken that time?
C: Not necessarily. It emphasises how necessary it is at the start to know your plan.
QC: On the basis of Mr Forbes’ report it is likely that the Joint Administratrs would go into the following season?
C: If you agree with the estimate.
QC: Did you look into trading loss account?
C: No
QC: How would you integrate the brand value with a sale and lease-back ?
C: [ed: no idea what he said]
QC: A period of months… did you think in terms of timescale
C: [ed: missed what he said]
QC: What about the fans’ reaction to delays?
C: Yes, but there would have to be a media manager
QC: [ ed: I missed his question]
C: Fans support their clubs through thick and thin.
QC: Mr Blucher… Mr Blucher ? I can’t hear you
Lord Tyre: Mr Blucher you’re on ‘mute’……..
B: My apologies. Can you hear me now
Lord Tyre: Yes, can hear you now.
B: Can you repeat the question, please?
QC: If the Administration goes on for longer than expected does that cause problems?
B: The Administrators set their cash and cash flow to end at May, or the middle of June. If they fet that their timing was wrong they might have to trade on……
Lord Tyre: Mr Christie, you have something to say?
C: Yes, m’Lord. I don’t disagree. Cash is king. How to maximise the cash available.
QC: Mr Christie, Mr Blucher talked about the end of May. You talk about the ‘artificial deadline’ when waivers cease, but it was a natural deadline that the Administrators were working to?
C: But if you were working to waivers and that period ends, it’s an artificil deadline.
QC: Let’s look now at heritable property. Mr Blucher, what is your view about the need for Administrators to seek professional advice?
B: I always take advice. But the Administrators have to make the strategic decisions………
QC: Mr Christie?
C: You need to take advice about alternative options If you don’t take strategic advice.
B: …. any valuation you had from your agents you’re working with…..[ ed: I missed the beginning and end of his remarks]
QC: Mr Christie, Mr Hutchison envisaged the Joint Administrators setting up a structure for the fans to enable them to put forward a bid?
C: That was one option, though you might have to help. I’ve no problem with tht suggestion.
QC: No point of conflict?
C: No, I don’t think so- you’re only going to sell for the benefit of the creditors, or in a management buy-out.
QC: [ed: he referred to a document but I missed which one! The reference was to ‘10.30 of page 32 or 33 of whatever , maybe the Expert bundle?] This talks of a parallel approach ( sell) the club with all its property, or sell each separately. You envisage that if the offer for the club was too low, you would try sale and lease-back?
C: Yes, thats almost a simple arithmetical point.
QC: Mr Hutchison woud sell the club first without the heritable property, and then arrange a lease?
C: You’d have to refer to property experts.
QC: Again, with a lease-back and sale approach , bidders for the whole might walk away?
C: It’s a balance.
QC: On a discrete point, the Rangers Youth Develoment monies. If we look at page 294 of your Supplementary report, this wasn’t in your first report. Why?
C: I had not been asked to look at it.
QC: So you are asked to look at specific topics?
C: Yes
QC: Can we look at the documents , 342, you were sent, 343, 344 up to 352. These were the documents relating to Youth Development?
C: Yes.
QC: To be quite clear: this is not the grounds of fault against the Joint Administrators. Were you given any information about Ian Hart and a loan to Rangers Youth Development?
C: Part of the ….[ed: didn’t catch the rest]
QC: Mr Hart sought repayment., and bought shares.
C: I was aware of that.
QC:Had you carried out any investigation into the £250,000?
C: No. I based myself on what was given to me.
QC So ..[ed: I didn’t catch his point]
C: Passing the money to one creditor is inappropriate.
MR McBREARTY intervening : M’Lord, it would be fair to put to Mr Christie that he had..[ed: ?]..
Lord Tyre: Let’s see the passage.
[ed: I assume that the passage in question was put on screen for the judge and others to read?]
Then, the next person to speak was
C: Paying all the money to one creditor.
QC: Did you do any further investigation into other creditors?
C: No.
QC: Did you investigate further debts up to 2012. No?
C: That’s correct.
Lord Tyre: Let’s stop now, and adjourn for lunch till 1.45. “
@WokingCelt
The Queen has done nothing for the poor of this country , she is happy to strip the public purse to upkeep her many castles and palaces , her extended family are paid a fortune and when the country is surviving on foodbanks she is quite happy for a new Royal yacht in memory of her husband to come before funding the NHS. The heir to the Dutch throne who has just finished school has refused to take any money from the State . Our Royal family are crucial in the subservient domination expected on its subjects which filter down the pyramid system of nobility and entitled to the Lords and most honourables.
The next Queen is Camilla Parker Bowles and it’s just fate that it isn’t Sarah Ferguson , it is bad enough that the next head of State will be the very good friend of Jimmy Saville , it could have been the very good friend of Jeffrey Epstein.
As for Biden , he is just a mass murdering war criminal
Wokingcelt. 11th June @11.31
I don’t, as a rule, comment on here about establishment/ political issues, but in off topic response…
It seems a bit odd for a ‘died (dyed?) in the wool republican’ to praise the ‘noble Queen’ (in fairness, not Lizzie’s fault) in such a glowing fashion, but I’m more taken by your Joe Biden comment about ‘standing back in recognition of his democratic status’.
To me that he, sadly, is a mere figurehead/puppet of his progressive masters, and a bit slow in the uptake these days (to put it mildly). To be brutally honest, he is becoming ever more confused about his surroundings. That’s why Sleepy Joe is ‘standing back’
His cognitive difficulties (by and large covered up by the liberal leaning and Trump hating American MSM) are evident for all to see (e.g unable to operate without a teleprompter – which, if it breaks down, leaves him stranded). He is being used and ought to be removed from the ‘firing line’.
That’s just my ‘tuppence worth’ mind!
Tremendous work JC , without your dedication and input nobody would have a clue to what was going on , a fascinating insight .
My post of 13th June 2021 At 22:48 brought Day 20 of the BDO v RFC 2012 plc case up to lunch on 9 June
This picks up after lunch:
Continuation of 9 June evidence session:
[ I apologise for getting Mr Blucher’s name wrong from time to time. It is Blucher (like the Prussian general at Waterloo) but I frequently typed Bulcher!]
Lord Tyre: Mr Christie, unmute, please. Mr Young?
Mr Young QC: On another topic, Mr Christie, the Craig Whyte shares. There’s no discussion in your first report. Why?
C: I wasn’t asked
QC: Can we look at p 258 para 3.14 in your Supplementary report? So you say that the Administrators had no control over the shares such that they could deliver the shares. Can I suggest there were three elements in the Administrators’ strategy? One, get agreement from Whyte, two, leverage of Ticketus, three, getting legal advice about taking legal action?
C: Arguably. But they should have had a clear strategy to remove all doubt immediately.
QC: but ….
C: but immediately on appointment get a mandate.
QC: What are you envisaging?
C: That you have the shares under the control of the Administrators
QC: Let’s say they tried but Whyte refused?
C: They could take early legal action to force control
QC: Are you suggesting there was a legal process that the Joint Administrators overlooked?
C: I’m suggesting that if you’re going to take legal action you want to do so as soon as possible
QC: If those are taken and there is no clear route, persuasion only?
C: If there is no voluntary handover ,or legal route, then there is no possibility of deliverability.
QC: [ addressing Mr Blucher] As an Administrator taking control of shares what was your experience?
B: It’s a normal situation ,when you’re trying to get a CVA to rely on shareholders to vote for;
Lord Tyre:or to hand over their shares when going for ‘going concern’
QC: Mr Blucher have you any examples of having taken control through a mandate at the outset?
B: Can’t think of one.
QC: Mr Christie , have you?
C: Not in shares, but we took a mandate to get control of a licence that we needed.
Lord Tyre: Mr Christie , obtaining legal advice: are you aware of a legal route whereby Whyte couldn’t refuse to hand over his shares?
C: The obvious route, m’Lord, would be if there was a debt to be called up.
Lord Tyre: Thank you.
QC: Mr Christie, what is your position in relation to looking at both CVA and an asset sale: is it your view that a CVA was inapplicable?
C: A CVA would have avoided the need to transfer the SPL share, but overly focussing on a CVA was ..[ ed: didn’t catch the end]
QC: A CVA was an option until June: are you accepting that it was reasonable to keep it on the table?
C : If it were kept in mind that it might not be deliverable.
QC: But how did they focus on one rather than the other? It was a parallel option-What can you point to to show there was undue focus on a CVA?
C: I’m not sure there is a specific point.
QC: [ citing ] “ it’ not clear…” Have you seen Mr Baird’s view?
C: Yes, I have
QC: Sale of the whole, if the Joint Administrators believed that HMRC might go with a CVA it was reasonable for them to keep it on the table?
C: That’s true.
QC: [to Blucher] Mr Blucher, what is your view of keeping the CVA on the table for as long as it did?
B: It seemed to me that the CVA was part of the discussions and it was reasonable to keep that live.
QC: Can you look, Mr Christie, at page 81 [ed: I didn’t hear what document he was referring to] .this clarifies : -you would be asked to comment on matters, but also be able to raise issues’
No further questions.
Lord Tyre: Mr McBrearty?
Mr McBrearty: QC Good afternoon Mr Buchler. You mentiond that you had dealt with ‘thousands’ of cases.How many?
B: Age has taken that away, I’m afraid, the memory is not what it was… [ ed: said with humour]
QC: Bedlow Manor plc. You were appointed. Who was your Joint Appointee?
B: No recollection.
QC: David Whitehouse……You did not disclose this.
B: I’ve made it clear in my documents that I’ve worked with Whitehouse, .. Gordon.. [ed: I think that’s a reference to Mr Christie] … nothing inappropriate.
QC: In your first report you didn’t mention this
B: [ed: I missed his reply]
QC: You took joint appointments with Whitehouse. Did you not think it proper to inform the Court?
B: [ed: again, his reply was not clear to me, but I think I heard the word ‘irrelevant’]
QC: Being in partnership with someone not relevant when you’re involved in a case..[ed: ‘concerning him’??]
B: I did think it relevant to mention it, but I don’t think that the fact that I was in partnership with Whitehouse and Clark……[ed: I’m not sure whether he finished or was cut off]
QC: You didn’t mention it.
B: [ed: he made some reply which I didn’t catch ]
QC: You were involved with Bradford City. So was David Whitehouse. What were your respective roles, you were senior?
B: yes
QC: Would you have been supervising Whitehouse?
B: No
QC: how many other appointments have you worked on with David Whitehouse?
B: I can’t say.
QC: A ball-park figure?
B: A handful.
QC: With Paul Clark?
B: A handful
QC: Is there a reason why you did not include this in your first report?
B: I can’t remember
QC: You recall that it was David Whitehouse’s mention of it in his report?
B: I didn’t focus on David Whitehouse’s report until March
QC: Were you asked to add this?
B: No.
QC: Did you discuss it?
B: Yes, with the instructing lawyers
QC: [quoting] “ I did not have any business contact with David Whitehouse” ?
B: I ws instructed in late 2020 approximately.
QC: what do you mean by approximately?
B: A reasonable time
QC: But you might be out by a couple of years?
B: I can’t remember
QC: But you know it was important ?
B: That… [ed: missed it]
QC: {ed: missed that question]
B: You are reminding me of dates I had forgotten
QC ——–
B:———–
QC: ———
B: ——–
QC: the precise number of years may not be important but you’ve been a little bit casual in expressing it in the way you have.
B: I wasn’t being deliberately casual
QC: You say that Whitehouse and Clark joined Duff and Phelps to set up the Manchester office?
B: Yes, but Clark was based in London.
QC: Blucher Phillips has 13 partners?
B: Yes
QC [ed: I didn’t hear the question]
B: [ed:didn’t hear the reply]
QC: Close working relationships?
B; Yes.
QC: In Joint appointments you would be the overseer as the more senior?
B: That’s more than likely.
QC: ‘Mentoring’ , in effect?
B: I don’t remember mentoring.
QC: Were you impressed by them?
B: They were good people.
QC: [ed: I missed the question]
B: Like most of the people I’ve worked with I don’t remember anything negative about Whitehouse and Clark.
QC: When you first heard of the criminal charges what was your first reaction?
B: I never really followed the Rangers cases, I’m not sure I had a specific view. There was something not quite right about it. They were never criminal people.
QC: When you write your reports you choose your words?
B: I write my report.
QC: You say you had no business contact with Whitehouse and Clark, what about other contact? We know from your CV that you’ve been involved in four football club Administrations. Football Club Administrations are at one every ten years. You’ve had four over 40 years or so, and the clubs involved were not on a par with Rangers.
B: Yes
QC: There were certain similarities; how to control the cost base, cash is king, continue trading…
B: Yes
QC: In an Administration one would try to make the company as attractive as possible to potential buyers?
B: Yes
QC: And if there was a specialist area you would seek advice?
B: You would use your own experience and expertise.
QC: But if it was outwith, you would seek advice?
B: Yes
QC: The Experts Bundle… the terms…“ please provide your expert opinion ” “appropriate to criticise” “ ..alleged deficiencies.” Agreed?
B: I was asked to comment on whether an ordinarily competent administrator would…
QC: How were you informed of the relevant facts?
B: I worked on all of the expert reports
QC: Par 5.6 , “ I understand that the Singapore consortium ….action of the SPL” From what source did your understanding come?
B: It would have been from information provided to me
QC: And what kind of documents?
B: The bundles, documents sent by my instructing lawyers (CMS)
QC: Have you different sources?
B: I can’t remember
QC: Did you meet with David Whitehouse to discuss?
B: No, I only met him this year in March, April.
QC: Let’s look now at page 194, para 8.11. If you would read that to yourself….
B: [ after reading] Yes
QC: The point you’re raising is that voluntary redundancies might be in breach of the regulations of the SPL.Is it a fair reading that you saw this as reading like part of the Joint Administrators’ thinking?
B: I’m sure the Joint Administrators would have had their thoughts..
QC: Do you know that they took it into account, or are you saying it?
B: [ ed: I missed the reply]
QC: There’s a distinct difference there
B: [ed: never heard his reply]
QC: We’ve seen that the Joint Administrators were on the cusp of making redundancies on 3 and 4 March 2012..We don’t see anywhere that they were considering whether they would be in breach of SPL regulations..?
B: Well, they would be aware of the need not to breach any rules
QC: Did you speak to the SFA and SPL?
B: No
QC: what I’m trying to be clear about is whether you are providing an ex post facto rationalisation?
B: I don’t understand.
QC [ ed: he explained what he meant,]
B: [ ed: all I could pick up of the reply was ‘…any action that would attract disciplinary measures..’
QC: Naismith? a close judgment call?
B: Yes
QC: Read what you say about that?
B: Yes
QC: [quoting] “it is my understanding that it would….. less attractive”. On what basis did you arrive at that understanding?
B: I got that from Paul Bobroff, my colleague and Chairman of Tottenham Hotspur. We discussed Naismith. He was very clear that the club would be less attractive if Naismith was sold.
QC: So that was not contemporaneous?
B: It was part of a discussion that I had..
QC: Do you think a bidder would be put off because of the sale of a single player?
B: [ed: I didn’t catch his reply]
C: It must be true that the Administrators were ready to sell?
B: Yes
QC: The final offer for Naismith was on 17 April 2012. By then the best and final bids were in. The best and final bids were around £10 million. So the Joint Administrators knew that the value [ed: I missed the next clause of the sentence] … and the PFA had indicated that players would not necessarily transfer under TUPE.
[ There then followed an exchange about Naismith and the possibility/ desirability of selling him given that he might leave for nothing. The exchange ended with
B: It’s a judgment call. And I wasn’t there so I can’t judge it.
Mr McBrearty suggested that perhaps his Lordship might think it was break-time.
Lord Tyre: Yes, we’ll break now and resume at 3.10.
On resumptionat3.12.
Mr McBrearty : Mr Blucher, as a formality I have to put it to you that no ordinarily competent administrator would have failed to sell Naismith. Your comment?
B: I just don’t agree with that.
QC: If Naismith had been the subject of report in the Press, mightn’t you have contacted other clubs?
B: It’s a very small market. Anyone reading would know what was going on in Rangers. If there had been interest it would have come to Rangers.
QC: If there was reported interest, wouldn’t you go to look?
B: If there was a specific club….
QC: Let me ask the question again: if you know there is an interest wouldn’t you go and ask?
B: Wouldn’t it be the other way round? The ‘interested’ club would trigger other interests?
QC: But what I’m not getting from your answer is what would be lost by phoning other clubs?
B: Probably very little.
QC: You are not an expert on the value of players. On page 19 , para [?], you say “ I also note that Mr Lombardi’s valuation”… Why do you call his methodology arbitrary?
B: I remember his methodology being discussed with Paul Bobroff and Cathie Gledhill.
QC: Mr Lombardi is an expert, why did you comment?
B: I’m not an expert but I have a degree of knowledge as to how the market works
QC: But you haven’t been instructed to give a report?
B: [ ed: missed what he said]
QC: The paragraph above, 7.33 , has “ Naismith injured” You’re not a medical expert. Why are you speculating as to his injury affecting performance?
B: Just a general observation.
QC: Nothing to do with your area of expertise?
B: I don’t have knowledge ….I said ‘the injury’
QC: When you use the words ‘my understanding is’ what do you mean?
B: It’s just part of my language
QC: Based on facts provided from discussion with colleagues?
B: It could be.
QC: What you are saying may or may not match up with what happened in 2012?
B: I wasn’t there.
QC: Let’s assume that at 5 April 2012 the wage reductions had been agreed and at that date the bids were around £10 million , they would not [ ed: I lost the rest of his question]
B: I don’t necessarily agree, but I’m waiting for you to get to your point
QC: They should have sought to realise their value as soon as possible.
B: I think there’s a lack of understanding about what it’s like with a closed transfer window. The ability to sell players is rare. I cannot see that the disposal of players as possible..
QC: 5th April 2012, at that point, take advice on the prospect of sales?
B: Take advice from those who know , those in the club.
QC: If they did not know whether they could sell or not they would have needed to ask?
B: In a closed window, sales are minimal
QC: Why wouldn’t you sell ?
B: Why would you sell a whole load of players when you’re trying to sell on a ‘going concern’ basis?
QC: Why would it destroy the hierarchical values?
B: Because it’s not the way the market works. When you’re thinking of buying a player it’s in the needs of your own club.
QC: Again, why would you not try?
B: [ed: missed that]
QC: para 5.11: is it your understanding that the cash flow deficit was £4.5 million? Were you aware of that?
B: No
QC: The trading deficit was just over £4.5 million.If they had attempted to sell some players?
B: It is so difficult to see how the sale of players would……….I don’t believe it.
QC: But that is not your specialism
B: You asked me to comment
QC: But the market could have been tested?
B: [ ed: didn’t hear his reply]
QC: The signing of Daniel Cousin, Mr Blucher. Within the first week of the Administration the Joint Administrators had supported the wish to sign him. What do you make of that?
B: I wasn’t there at the time
QC: So you dont’ want to comment on that?
B: It’s not something I think I would have done, but not having all the facts…
QC: On another point, wage reductions or redundancies? Is that a matter of judgment?
B: Yes, a judgment made on the facts.
QC: a de facto creditors rule, would that have the same effect as ‘deferral of wages’?
B: Yes
QC: It’s not your area. If it were to be the case that there was no de facto creditor rule then there was no equivalence to deferral of wages?
B: Yes
QC: The purpose of Administration is re-structure in the context of cost reduction?
B: Yes
QC: page 3774, an internal email , Whitehouse,11 March , right hand side “and what I’ll come on to shortly….bid for business..” There would be an attempt to change the cost base ?
B: They’re going to have to save cash..
QC: [ began to ask a question]….
Mr Young QC: Don’t answer, Mr Blucher, for the moment. M’Lord, what Mr Whitehouse meant is for Mr Whitehouse to answer.
Mr McBrearty: Very well. I’ll ask Mr Blucher: do you believe that the cost base should be restructured so that a new purchaser doesn’t inherit a failed structure?
B: [ ed: I have no note of what he said],
QC: Major cash flow problem, cash deficit £3.5 million, and structure that caused that problem needs to be changed?
B: ———
QC: ——-
B: They found a buyer prepared to take the structure on.
QC: Deferrals didn’t have the effect of restructuring the cost base
B: But it reduced the cash need.
QC: The contracts making the club nearly unbuyable points to something having gone wrong in the way the Administrators approached matters.
B: there’s no doubt that the club was loss-making
QC: The Administrators had entered a deal with the players NOT to make redundancies.
B: [ if they hadn’t] there would have been loss of goodwill etc
QC: Do you accept that making redundancies would have cut the cost base?
B: [ ed: I have no note of reply by Blucher. If he replied I didn’t hear it ]
and the next thing Lord Tyre brought business to a close with a “we’ll leave it at that, till tomorrow morning 10 o’clock. Hearing is adjourned till then.”
Now, I have to repeat that I have written only what I heard for sure was the essence of what was asked and answered., using as far as I could the actual words and expressions used by Counsel and witnesses. I have not made anything up or knowingly distorted anything that anyone said, and certainly did not deliberately report inaccurately.
I also have to say that although I have notes, or partial notes, of about 12 or 13 days hearings, I have not heard all the evidence from all of the witnesses. And , of course, it’s axiomatic that until all the evidence has been heard, any attempt at ‘judgment’ is not on.
As a civil action, judgment is made on ‘the balance of probability’, where the court weighs up the evidence and decides which version is most probably true.
I should maybe add that the ‘virtual hearing’ technology in itself worked pretty well. There were no serious malfunctions. When I had difficulty hearing was when ,for example, the speaker was too far from his mic , or when Mrs C was going about her lawful business in the kitchen, emptying the dishwasher or washing machine , or when the phone rang or an Amazon delivery arrived and such like.
I will try to get round to typing up some of the rest of what I’ve got before Friday.
[Quite entirely unconnected, I enjoyed Willie Miller this afternoon as the upbeat comforter of Richard Gordon and Craig Levein and Billy Dodds!
And he was right to be upbeat, in my opinion. The result did not reflect the game.
Thanks again JC
Cluster One 14th June 2021 At 23:53
‘ ..Thanks again JC.’
++++++++++
Not that I’m looking for thanks !
There are, I am sure , many of the people who could see me far enough!
Truth can hurt.
But the denial of Truth ?
That kills!
There is a lot of talk that out of the Covid loan fund, Rangers accessed £3.2M, while every other club got £1.6M. One club did not take the loan. Why was the extra available £1.6M not offered equally between all other clubs instead of being given in whole to just one? Rangers themselves have confirmed they owe the SG £3.2M.
Can the punters and media layoff the call for Gilmour and Patterson to come to the rescue of Scotland’s national team. While both maybe young and exciting players to expect them to lift the Scotland team to success against England and further advancement in the Euros might be too much to bear for the young men. The expectations of the country should not rest on their shoulders. Neither has much experience at this level and while playing in CL and EL games is good for development throwing them into the pressure cooker on Friday and having the team come up short could affect their future development if they don’t perform as the punters and media seem to think they can/will.
John Clark 15th June 2021 At 00:09
………………………….
You will get it from me all the same;-)
UTH 15th June 17.00
Can i ask where “the lot of talk” emanates from?
@UTH – any idea which club didn’t take up the loan option? On the face of it, it does seem extraordinary. Maybe that the loan was available on some sort of jobs to loan ratio. Having said that would I (or indeed HMG) lend a punter money (our money) when the same punter still owed me from previous dealings and had no intention of paying? Of course not – there goes the “same club” argument right there.
@Vernallen – couldn’t agree more. I would argue against Steve Clarke’s starting 11 against Czech Rep but:
1. The man got us there
2. Lumping such expectation on to these young players is gambling with promising futures for our own gratification.
I am sure that Steve Clarke is doing his level best (which is a heck of a lot better than I could do) to put the right team on the pitch through the 90 minutes. To read Tom English (amongst others) to give views with hindsight is sickening, not least when they refuse POINT BLANK to hold our football authorities to account for consistency and (heaven help us) honesty and decency.
Off to watch France v Germany (you would think England fixed the draw!)
Wokingcelt 15th June 2021 At 19:37
@UTH – any idea which club didn’t take up the loan option? On the face of it, it does seem extraordinary. Maybe that the loan was available on some sort of jobs to loan ratio. Having said that would I (or indeed HMG) lend a punter money (our money) when the same punter still owed me from previous dealings and had no intention of paying? Of course not – there goes the “same club” argument right there.
+++++++++++++++++
The conclusion being made is Celtic didn’t take up the loan offer, but there is no evidence provided to confirm that.
Here are my notes of Day 19 ( 8 June 2021) of the BDO v RFC 2012 plc.
Lord Tyre: Mr McBrearty?
McBrearty QC: Good morning, m’Lord. I want to introduce Mr Hutchison.
Lord Tyre: Good morning, Mr Hutchison. Can I ask you to confirm that you’re alone, mobile on silent, and have arranged not to be disturbed?
H: Yes
Lord Tyre: Will you take the oath? [ administers the oath]
Mr McBrearty: Mr Hutchison, can you confirm your name, age, address, occupation [chartered surveyor] , and that the statements on page 379 of the Experts Reports bundle and the Supplementary report on page 492 and the note of a Joint meeting between Mr Timney and Mr Plum have your signature?
H: Yes
QC: Have you had a chance to re-read them and are you content to have them as your evidence subject to anything you might wish to add today?
H; Yes.
Mr Young QC introduces Mr Timney and Mr Plum.
Lord Tyre: [ usual spiel, and swears each in individually]
Mr Young: [ takes them through the same name, age, address stuff] You’ll see the Experts bundle on the screen. And a copy of the Joint report.Mr Timney, this is a joint report. Why?
T: The normal practice. Alan specialises in football stadia. I focus on trading practices.
QC: Do you have particular expertise in Insolvency
T: I worked for some years with Bank of Scotland/Lloyds.
P: I have.
QC: If we look in the Joint Bundle at p 3032. This is an email from a Morris Rothbart, an offer on behalf of a Mr McKenna, proposing a sale and lease-back of Ibrox for 20 years at £1.8 million a year, with the possibility of a buy-back at the end of ten years, for £14.185 million. Have both of you seen this?
T: Yes
P: Yes
QC: Mr Timney, how deliverable would such an arrangement be?
T: I would have had some concerns,particularly about Murray Park, the planning belt conditionality, the Planning Commission, and why rent would be guaranteed by Capita, a third party.
QC: Mr Plum, do you have any comments on the level of rent, £1.8 million?
P: It’s extraordinarily high.I cannot imagine a distressed football club being able support a rent such as that.Even doing well, Rangers would have struggled.
QC: Mr Plum, Capita guaranteeing- would you ever see a guarantor?
P: I’ve never seen it. A very rich man might possibly..
QC: No further questions.
Lord Tyre : You can begin your cross-eamination of Mr Hutchison
Mr Young QC: Thank you, m’Lord. Mr Hutchison, a lease-back structure , you’re envisaging the lease being between the purchaser and the Joint Administrators?
H: Yes.
QC: In the situation where the club emerges from Administration?
H: It could be, or another party later.
QC: In broad terms ..[ed: missed it]
H: [ed: missed the reply]
QC: The terms of lease-what were you envisaging in your report, para 5.85 on page 405, last sentence , ‘short lease’?
H; There could be another option, a licence to occupy until the purchaser …
QC: Isn’t it more likely a longer lease would be wanted by a buyer?
H: That’s a fair comment.
QC: Under a fan ownership model……12 months……..3rd party 6 months?
H: Yes
QC: If it was a valid option you’d set out the pit-falls? Anyone purchasing the club even without a stadium would need to be encouraged to keep their bids active….The price woul reduce?
H: They would not be getting the heritable property.
QC: [ ed: missed
H: [ ed: missed]
QC: There’s a risk that they would drop out?
H: A risk, certainly
QC: In an arrangement between the Joint Administrators and prospective tenant….The terms: you say an option to purchase later would be attractive?
H: Yes
QC: Necessary?
H: Not absolutely, but helpful
QC: [ ed: missed the question]
H: [ed: missed any reply]
QC: The rent level would be crucial?
H: Yes
QC: You suggest £1-2 million, based on turnover and profitability
H: There are various comparables
QC: To be affordable to Rangers, profitability is key?
H: If the club is run in a viable way
QC: You refer to the accounts in 2013-2017, but 2012 onwards is in your report?
H: The club had not been run in a sustainable manner
QC: Had you looked at profitability for 2012 onwards?
H: Not in any great detail
QC: There are serious questions about whether Rangers could have paid that level?
H: I disagree.
QC: Mr Plum, profitability or turnover?
P: Turnover is one thing, ability to pay is another. Unless you are making a profit you’re not in a position.Profit is the key, otherwise you need subsidy.
QC: Mr Hutchison?
H: What you need to look at is whether the operation .. [ed: I can’t say whether he finished his sentence before Lord Tyre spoke}
Lord Tyre: Mr Hutchison, “ ongoing subsidy” – Football clubs are run differently: do you assume that there will be an owner prepared to subsidise?
H: No
Mr Young: Mr Hutchison, can we look at the first bundle, p 1944, of the Expert documents: operating loss 2013 £17.5 million.Year 2017 , p 2705, bottom of pge, in the Premier league. £6.5 million loss.
H: Yes
QC: If we have the lease in place , look at the Joint Administrators’ next need: to find a commercial investor.Would a Pension Fund be interested?
H: Possibly, but it’s more likely that high net worth individuals would be
QC: Can you flesh that out?
H: Yes, property companies, overseas investors, private investors
QC: They would be looking for a 7.5% yield?
H: Yes
QC: That’s not realistic,really. Wouldn’t they be looking for a better yield?
H: In Peterborough United ‘s case as an example the yield was much lower, and there are some other parallels.
QC: Mr Timney, ?
T: Pension funds wouldn’t look at such an arrangement, and 7.5 is only a shade over what prime office properties in Glasgow were fetching.Buy-back arrangements make an asset difficult to sell.
QC: Mr Hutchison, thhere’s a difficulty if there is no certainty as to buy-back option?
H: Yes
QC: [ed: missed the question]
H: The likelihood of ‘no club’ was not going to happen. Effectively investors were given a ‘covenant’ by fans
QC:; Another insolvency event…?
H: The Dundee example… covenant to successor club
QC: Mr Timney?
T: A property investment is just another investment- fraught with risk.
QC: Mr Plum?They’re not transactions at all. If you want a responsible club to come in, you wouldn’t be paying rents of £1 million.
QC: Mr Hutchison, one of the other differences is the ‘alternative use’ values. You refer to…
H: Am I allowed to come back to Mr Plum, please?
QC: Yes.
H: Arms-length purchases in smaller clubs…
QC: But can I ask you about your description of Savil’s alternative use as being misleading?
H: I think it’s unlikely that Rangers would have shut up shop.
QC: Any investor has to look at worst case scenario, so ‘alternative use’ is relevant
H: It is unrealistic that Rangers would not continue…Investors look at current use as being highest value, alternative use considerations are less relevant
QC: Mr Timney, do you accept that?
T: No. It’s not misleading to look at worst scenario- the back-stop position in case of arrears, failure to pay…
QC: Mr Hutchison?
H: The worst case realistic scenario
QC: You may be aware that the fans groups were well informed. They knew the bids were going down from about £10 million downwards.Wouldn’t there have been great difficulty in persuading the fans to pay £20 million?
H: I think the Joint Administrators backed themselves into a corner. I think they should have made the running, taking property advice.
QC: Of the two models wouldn’t fans want to minimise the cost?
H: [ed: didn’t catch his comment]
QC: The assumption would be that fans would have sought…?
H: The Joint Administrators would set up a company for the fans…
QC: 15 to 20 million pounds? What drives that sale price, 20,000 fans paying so much each?
H: [ ed: all I got was ‘.. debentures… a scheme different from mine..’]
QC: Completely driven by the number of fans prepared to pay?
H: Ultimately, yes.
QC: What incentive would there have been to purchase after the club had been saved?
H : Obtaining an element of control
QC: But there is a difference between when the club has been saved by a new owner, and the danger is passed ?
H: t The danger is not necessarily passed
QC: If you were advising the JA’ s you would be hoping that the fans will still feel so energised
H: There’s always a risk with property investment
QC: This is a different risk- a key investor….
H: [ed: again I missed his observtion]
QC: Let’s have a different look at this. Lease-backs , in general. Have you personally any experience in leasing stadia?
H: No
QC: The timescale, broad estimate?
H: Informed, but broad, yes
QC: Have you any knowledge of an actual ?
H: No
QC: Any example in the UK of fans owning stadia separate from the clubs?
H: Not aware of any.
Lord Tyre intervened: [ed:@11.36] I think we should have a break for the transcriber.15 minutes till 10 to 12.
On resumption
Mr Young : Mr Hutchison, in terms of lease-back of stadia in general, do you accept that often the the common situation is lease-back from a Council or club-related body?
H: Yes
QC: Bournemouth, the only example of an ordinary commercial example?
H: [ed: missed it]
QC: Council tenant, related company, rents not necessarily market rent?
H: Not necessarily
QC: At p 1221 on p 498 of the Experts Bundle, you refer to similar structures- Aston Villa, Derby County, Sheffield Wednesday. Have you looked at these in detail?
H: No, they’re of limited relevance, 2018
QC: Do you know who the landlords are?
H: All related parties
QC:; and the ‘driver’?
H: ‘Fair Play’ arrangements
QC: Look at para 5.4 You say that there is separation of ownership from the club. Are you saying a professional adviser would be negligent in not suggesting separation?
H: Yes, it would be negligent not to suggest different options.
QC: You go a little further: “ the better option IS to separate”?
H: I do believe that.
( the voice of Judith, the transcriber, intervened, informing the judge that there was a glitch, her machine had not recorded the last few exchanges. This was sorted, and business resumed at 12.11)
Mr Young : Would you be critical of advisers who did not flag up the better option?
H: Yes
QC: Only critical of the £5.5 million offer?
H: I think the JA s should have been monitoring as they went along
QC: So, for example, we know that when the final bid came in at £10 million, the adviser should have been looking at separation?
H: Yes
QC: But one option is fan ownership, a risk, and the other option a high risk?
H: There is risk in everything, risk must be managed.
QC: the fan option has never been done
H: there were still two options.. and fans could be epected to..
QC: [ed: missed his actual words]
H: they could have set up a structure, do a proper job….
QC: To be run by the Joint Administrators…. that’s not in your report as such
H: My apologies.
QC: Huge risk. Joint Administrators having to hold for year or more?
H: They could have set up a company to manage the process
QC: My proposition I that you don’t acknowledge the high degree of speculation. Mt Timney, hve you view?
T: Incredibly speculative from my perspective.I don’t think an Adviser would be incompetent if he did not put separation forward .
Mr Plum: We discussed this at our joint meeting with Mr Hutchison. We are at completely opposite ends.
QC: The 6 to 12 months for fan ownership. Mr Plum, what do you think of those timescales?
P: Extremely tight, I believe. 6 months is not a reasonable time.
QC: Mr Timney, anythingto add?
T: 6 months was highly ambitious at that time, and a pioneering venture? 6-12 way too short.
QC: Mr Hutchison?
H: We just agree to disagree
QC: In relation to Murray Park, there is agreement that it might have been sold for circa £3 million.In Savils report ,p1025, pge 475, te suggestion is that that could take 18-24 months. Do you agree the timescales?
H: my figure is not too different, butv there is some agreement about time scales.
QC; No further questions,
Lord Tyre: Mr McBrearty?
Mr McBrearty QC: Mr Timney, the Lambert Smith Hampton property valution, unusual?
T: Yes
QC: Planning condition make it uncertain what the Ibrox land would be worth?
T: Yes
QC: Look at the land around?
T: Yes, listed building..
QC: LSH looked at the surroundings, no difficulty with that approach?
T: No
QC: Break-up values,… assets sold separately?
T: Yes
QC: Need to provide a valuation that is reliable?
T: Yes
QC: At para 10.18 you say “ unique circumstances opinion guesstimate” Are you not doing down you own profession?
T: No. It’s not as though you have row of shop and such like, there’s high degree of valuation tolerance
QC:[ ed; missed the question]
T: The Red Book is quite clear ,we don’t have lots of Ibrox stadiums being sold.
QC: Sale and leaseback. Mr Plum, sale and lease-back is well known, agreed?
P: Agreed
QC: It has been used for football stadiums?
P: It has been known.
QC: Bournemouth?
P: Yes, 2005
QC: Peterborough?
P: I didn’t look in detail at smaller outfits
QC: Arms-length transaction?
P: I can’t answer,don’t know the detail. I have a note about Leeds.
QC: Can you read yo…
Lord Tyre: Mr Plum, I’d rather you didn’t read your note if it is not a document lodged with the Court
QC: Leyton Orient?
P; Not arms-length
QC: You agree that there are property experts who specialise in stadia?
P: I don’t know any
QC: There is a flier….?
P: That would be Alan Whittaker. He would not claim to be an expert.
QC: Are you aware of the offer from Rothbart on behalf of high net worth individual?
P: Yes
QC: You said that rent level at £1.8 million was higher than Mr Hutchison’s?
P: Yes
QC: But that was a first offer?
P: [ed: missed his reply]
QC: Might have been room to increase the price?
P: [ed; missed it]
QC: Only one way to find out?
P: You’d expect it to be explored.
QC: There might have been others, there would be a market?
P: Not everything sells. But the rent..
QC: But the point is, the only way is to test the market.
P: But the time required…
QC: What would be the downside of exploring? Wouldn’t your job be to advise of all possible…?
P: As long as they didn’t have time constraints
QC: Wouldn’t you just see what offers you could get?
P: You could, but you need to have things established , a data room
QC: But if you had been approached?
P: We do turn work away.
QC: Rothbart was prepred to make an offer
P: He didn’t have a position.
QC: He made an offer without prompting- you’d be expected to… [ ed: missed it]
P: ‘Hope’ might be a better word.
QC: The difficulties. First the ‘covenant’ of the fans. .. Clubs survive?
P: Yes, in some shape or form
QC: Because of the fans
P: Yes
QC: [ed: missed his question]
P: The guys at Rangers were in a desperate position.
QC: [ed; missed ]
P: [ed: missed]
QC: [ed: missed]
P: There’s no way that the club could have afforded £1-1.5 million rent. There’s only one club in Scotland that makes a profit, Celtic.
QC: But Rangers, 55 titles, qualifying for Europe, 50,000 fas every two weeks, elite fans, 5 million worldwide?
[ed: What I have next is ‘ Mr Hutchison …. properly managed Rangers could afford that rent ‘. It’s not clear whether the QC was saying that that was what Mr H utchison’s already stated view was, or whether he had addressed Mr H and that was Mr H’s response]
LordTyre: We’ll break for lunch now, till 1.50.
After lunch:
Mr McBrearty: Rent is paid out of profit, not turnover?
P: Yes
QC: You look at income and expenditue?
P: You work out rent and wht you can afford.
QC: So we go back to the dispute about the level of rent?
P: Yes
QC: Someone will reduce their bid if they’re not getting the property?
P: Yes
QC: Clubs need access to the stadium,agreed?
P: Absolutely.
QC: But they don’t have to own it?
P: No
QC: Their bid is likely to be less ,and depend on all sorts of factors?
P: Anybody buying a club will want to know where they will play. Buying a club without the property is a different thing
QC: There are other factors that a bid for the whole shooting match will depend .. Sevco £5.5 million?
P: Where did that price come from?
[ ed: I have blank spaces and a few scribbles that I can’t make sense of ]
then
P: There’s no question that £1.5 million is a realistic sum!
QC: [ed: didn’t catch the remark]
P: £5.5 million.
QC: If what was on offer was £5.5 million and you had a third party offering £10 million?
P: You would test deliverability
QC: And if …[ ed: another short quick-fire echange that I missed]
then, QC : [ to Mr Timney] … because the landlord can rent to only one party
T: [ed; missed it]
QC: There’s only one tenant and one landlord and retain…[ed: missed it]
T: [ ed: didn’t hear what he may have said]
QC: To either. Now, on a third party investor, “ he fans might not have liked”?
T: Yes.
QC: A fans’ group purchasing the heritable property: would you not have looked at it?
T: [ed: I caught only] “………how would we deliver a higher price?”
QC: If you’ve got a club for sale you want as many bids as possible .The Administrators would be looking to the fans to get organised?
The nub of the difference : Mr Hutchison has greater optimism about the fans’ ability and
willingness?
T: Yes. But how to do that in practical terms?
QC: Negativity….
Timney interrupts: It’s about being realistic and robust about something that hs never been done…
QC: I hadn’t finished my question ..
[ ed: my next line is ‘whether it is worth..’ I can’t say who said it and in what immediate context]
then,
QC: Mr Hutchison, if the offers were [ed: didn’t hear the full question]
Mr H: [ed: didn’t hear any reply tht was made]
QC: [addressing both Mr Timney annd Mr Plum] It would hve been reasonable to look at the fan’ record?
P: Agree.
QC: a new stand built 20 years ago, by the fans,unsecured debenture holders…?
P: [ed: missed his reply]
QC: To own outright the whole of Rangers?
P: [ed: missed his observation]
QC [ed: missed it]
P: If the club were already saved , the fans might not step up.
[QC: It may be that money is going to the creditors but the fans would own the home ground?
P: But why would the fans not have bought the whole thing?
QC: There were lots of fans willing to….
P: 20 000 fans-why did they not submit a bid?
QC: [addressing Mr Hutchison] Mr Hutchison, your observations?
H: To my mind the Joint Administrators were in a position to help the fans set up.Remember the fans were very nervous when the Bank held security.
QC: Mr Plum I do think you are looking at things from the emotional side…
P: I’ve been doing this for a long time: a pioneering situation? I don’t think ..
QC: Well, we’ll accept that we’ve been round the houses on this..
As regards Murray Park do you agree that Murray Park would have sold?
P: Broken up.
QC: What do you mean, broken up?
P: Broken up, smaller units
QC: Would it have been possible for the club to have kept part of it?
P: Possible.
QC: A sale of the whole thing, with a lease-back?
P: Possible, yes.
QC: I have no further questions for Mr Timoney and Mr Plum. Mr Hutchison, there are two sets of accounts of losses. Does that detract from your view that a rent of between £1 million and £1.5 million was possible?
H: No. If Celtic could be profitable, so could Rangers.
QC: No further questions, m’Lord.
Lord Tyre: Mr Young?
Mr Young QC: Thank you, m’Lord; Now, Mr Plum, you remember Mr Rothbart, Joint Bundle 4, p 3032. O ne of the things you would expect this offer to be explored. Did you know of the discussion between Mr Rothbart and Mr McKenna?
P: I don’t know a lot.I couldn’t say whether Mr Rothbart was broking for a position.
QC: Were you aware of the signing [ed; my manuscript is ‘sign.’ ] of 11th May?
P: No
QC: no further questions.
Lord Tyre: Mr Plum, Mr Timney, Mr Hutchison , you’re free to switch off and leave us.
T, P and H variously ; Thank you, m’Lord.
Lord Tyre:Any further business? No? Mr Christie and Mr Blucher tomorrow.
We’ll adjourn till tomorrow at 10.00.
.
Great work, JC. I particularly liked this line from the above….
“No. If Celtic could be profitable, so could Rangers.”
Said with absolutely no understanding that e.g. Celtic has 10k more seats at the stadium for every home game, was starting with more money in the bank as at 2012, had access to all their season ticket money for the next X years as opposed to Ticketus taking their share etc etc. Where do they dig these ‘experts’ up from?
Nawlite 16th June 2021 At 14:27
‘…Where do they dig these ‘experts’ up from?’
+++++++++
That’s an interesting question, which prompts another: in the abstract, who defines what an ‘expert’ is?
Who checks that any particular ‘expert’ HIRED by someone is going to give evidence that won’t help that someone?
What price ‘objectivity’?
Particularly in those areas where there can be no ‘hard’ scientific ‘absolute’ truth?
I come back to reflecting on the Del Boy type of barra-boy ‘financial adviser’ in the silver-haired, pin-strip- suited , but cockney- accented type of con-person we have seen during this saga.
Are we to assume that ‘professional men /women’ are by definition honest, and free of any bias in favour of those who are going to pay them?
I speak in the abstract, of course, and not in connection with any current litigation. I think its an interesting philosophical question.
But then what do I know?
[ except maybe that the football that led to Locatelli’s second goal was absolutely brilliant!]
Nawlite 16th June @ 14.27
In this case, ‘experts’ are recruited and delusional propagators of the ‘Big Lie’ narrative. All their comments are linked to that. Keep the faith on that eventually being exposed.
They should be ignored by rational people like your good self and JC!
Judging by comments from elsewhere then the full transcript of the BDO VRFC 2012 case will make interesting reading for some whose long held beliefs may be challenged.
Best wishes to Bertie Auld who has been diagnosed with dementia.
upthehoops 15th June 2021 At 17:00
There is a lot of talk that out of the Covid loan fund, Rangers accessed £3.2M, while every other club got £1.6M. One club did not take the loan. Why was the extra available £1.6M not offered equally between all other clubs instead of being given in whole to just one? Rangers themselves have confirmed they owe the SG £3.2M.
============
From what I have been told, the fund was available to all 12 Scottish Premiership teams, equaling a loan of £1.6m per club, only 6 clubs took up the loan option (which to mind mind seems crazy) I’d bite your hand off for a £1.6m 20year interest free loan, just to let it sit in a bank and accrue interest. So TRFC and 5 other clubs apparently had double the spoils to take the loan option on, making theirs around £3.2m.
I’m sure with their flawless record of paying their debts, all will be fine 🙂
Fitbawfan 17th June 2021 At 18:01
‘…I’m sure with their flawless record of paying their debts, all will be fine’
+++++++++++++++++++
Do we know whether the loan fund was to the SPL as the principal borrower, and they then offered loans to those clubs that asked?
And, if so, and any club defaults, does the SPL pick up the tab for that club’s loan? Or is each borrower directly liable to the Government ?
If it’s the former, how very brave of the SPL board to underwrite a £3.2 million loan to TRFC Ltd!
Well, tat was a bit of a dissy. That’s the proceedings in the BDO v RFC 2012 plc case finally concluded. I had thought (unthinkingly) that judgment was to be given today. But Counsel had their oral submissions to give. Began at 10.00 this morning and finished at 3.35, with Lord Tyre thanking all and sundry.
The judge said he would deliver his judgment as soon as he could.
Counsel more or less summarised all the main points they wanted to make , while dealing with counter points made by each other.
The judge made one or two observations about the weight he would attach to the evidence given buy some witnesses, and had some questions about the significance of some of the arithmetical calculations relating to various bases of comparing savings under redundancies v wage reductions + player sales.
And, apparently, while Regan former CEO of the SFA had provided a written statement , he did not give oral testimony (about any de facto football creditor rule )
Just two comments tonight from me:
1. Billy Gilmour – just wow. A superb performance from him and our team overall.
2. Harry Kane – he didn’t bite me in the bum!
Croatia – who knows…
Yesterday I received a reply dated 15th June from the Assistant Private Secretary to the Master of the Rolls.
The full text of the letter is as follows:
” Dear [ me],
Further to my letter of 9th June.
Your letter of 4 June 2021 has been considered by the Vice-President of the Court of Appeal ( Civil Division}, Lord Justice Underhill ,who presided in this appeal.
He appreciates the care with which you have read the judgment of Phillips LJ, but he is not persuaded that his summary of the background involves the misleading implication which you suggest; and in any event a point of this kind could not justify recalling and re-issuing the final judgment of the Court.
Yours sincerely,
A. C. ”
I will of course acknowledge receipt of that very courteous reply.
But I will have to consider carefully what else I should or may say!
I may discuss with my MP, who, I believe, is a Hearts supporter very proud of how hearts exited Administration honourably enough rather than opt for Liquidation and create a new club begging for admission into Scottish Football.
Wokingcelt 18th June 2021 At 22:38
‘..Just two comments tonight from me:’
++++++++++++++
And one comment from me.
Apart from anything else, that was a great game of football by a whole team. Akind of reminder of the 1967 victory over the World cup winners of ’66.
I wish I could read the European newspapers’ comments tomorrow to get their perspective.
https://www.heraldscotland.com/news/19384210.ex-rangers-administrators-accused-negligence-failure-consider-ibrox-sale/?ref=ebln
……………………………….
Former Rangers administrators have been accused of negligence through a failure to get advice on a sale of parts of the club including Ibrox and effectively selling the brand for nothing after it financially collapsed and was sold for £5.5m.
The claim has been made by club liquidators BDO case who are suing the former administrators of the business David Whitehouse and Paul Clark of Duff and Phelps for £56.8m claiming a flawed strategy in raising money to reimburse thousands owed money from the club’s 2012 insolvency under then-owner Craig Whyte.
…………………………………..
The claim has been made by club liquidators BDO…..What sacrilegist is this? Don’t they know it was the engine room holding company thingy.
The fellows who write for the DR surely have their blue tinted glasses on suggesting/hinting Steve Clarke might introduce Nathan Patterson into the line up for the game against Croatia. If you look at this realistically this is a must win for Scotland and scoring a few goals wouldn’t hurt in their quest to advance. Yesterday’s line up was quite impressive and performed very well. Why would Clarke want to break up that combination. Sometimes you have to look at the big picture and realize that its not all related to anyone connected to Rangers. Leave this group intact and the odds on advancing are very good, start tinkering, unless injuries dictate, and the hope of advancement could go out the window.
I know that not everyone is interested in the BDO v RFC 2012 plc case.
The case has little to do with TRFC , who of course are not the football club that entered Liquidation :the Administrators having signally failed to bring it out of Administration as a ‘going concern’ and being obliged to sell the assets extraordinarily cheaply to a new a company ,which then had to apply to be a football club. Oh ,the nonsense of ‘club 12’.
[How can guys like Regan and Doncaster live with themselves, as being the paid mouthpieces of Boards which instructed them to create a myth, and throw reality and truth to the wind? God help them to cope with the opprobrium they brought upon themselves as being suspected of being men of untruth, ready to obey untruthful superiors. Ja!]
But for any who are interested , I give you such part that I have so far typed up of my notes of the hearing on Friday 18 June, when Counsel made their final oral submissions.
I’ll get round to typing up the rest of my notes of that day’s hearing.
“Friday 18 June 2021 BDO v RFC 2012 plc (IL)
Lord Tyre: Good morning, gentlemen. I have read all the submissions, but have not followed up the Authorities.
Mr McBrearty QC: Good morning, m’Lord. With regard to the authorities, first, on a point made by the Respondents, I refer to Davey v Money ,Lord Justice Snowden, and the duties of Administrators, page 4, paras 255 and 256: the first para quoted , dealing with the standard of review of administrator’s decisions, the standard is “..of good faith and rationality”. Parliament has allowed latitude in regard to the hierarchical objectives.
Para 3(4)(b) of Schedule B1 is the 3rd of the objectives
Para 3(2) of Schedule B1 is the general .. not framed in terms of ‘thinks’ but of a more objective measure.
Para 256, ‘that latitude does not also extend to methods. ‘
That’s the territory we are in here. BDO do not criticise the CVA, but only the method used .
Another theme, in the authorities ie in para 2.11 of the Noters is failure to take professional advice: failed to take advice in the matter of sales outside the window, on brand valuation, on alternative disposals of heritable property.
There is support in the authorities; in passing: Ary Digital v Iqbal -flawed process ( cites his Lordship Walker in Pitt and Holt in relation to flawed process);
“In re Home and Colonial Insurance Co Ltd”, failure to take advice on the enforceability of creditor claims;
“American Express International Banking Corporation v Hurley”-failure to take advice on sound and lighting equipment;
In re One Blackfriars.( a virtual hearing, lengthy judgment , the importance of understanding context and the passages that the respondents rely on;
the breaches of duty were, one, too ‘light touch’ ( not sufficiently independent)
two, the Administrators had failed to investigate available planning consent for property, and three, a general allegation that the bidding process was not appropriately conducted.
Para 101-103 -agents appointed, paras 123-124-marketing strategy, 141-145 -administrators had [ ed: didn’t catch the end of the phrase]
The expertsi n the case thought it was appropriate to take professional advice , the Court had found that the Administrators had done,
367, the above shows they followed …[ed: lost what he said], but did not follow the advice, but followed a strategy . Nevertheless , acceptable.
In contrast with the current case in which advice was not taken.
Part of page 6 of the Respondent’s written submission: what I say is this : the administrators had kowtowed to the secured creditor. That doesn’t necessarily ..[ed: missed what he said].. but strategy needs to be continually assessed and revised…..
and later, ‘exposure of an asset to the market’ . Not enough, though, simply to leave it at that, but in the case the two pre-existing evaluations in different sums the administrators just put it on the market to see which. Not good enough
In the present case the Administrators 330-332 not in the same territory. [ ed: that’s what my note says.]
The Blackfriars case is consistent with the Noters’ case.
The other [ed: indecipherable scribble] “standard of care” and how it is to be judged, even if Blucher evidence is admissible.
Lord Tyre: Are you saying that Christie and Blucher is not…?
Mr McBrearty: In relation to Blucher and Christie, your Lordship is not bound to accept Blucher’s evidence.[ed: I have in parenthesis the words ‘ Mr Hyde v JG?’ . I assume that was a note to myself to remind me of context, not any words spoken by Mr McBrearty.]
Lord Tyre: The Hunter and Hanley case was just about.. broader admission of doing something..?
Mr McBrearty: Lord Justice Sedley, Lord Justice Ward… where no ‘specialism’ is involved for example, ‘getting under the skin of a different profession’. In this case are Insolvency practitioners, no ‘specialists’ Your Lordship is to decide , not ‘having to get under the skin’
and, two, Nye Williams case ,’”this is what I have done’ is not expert.
Three [ed: I missed what he said]
Four , ‘Dunvale’ [ ed. presumably some case that his Lordship was familiar with]
About the admissibility of Blucher’s evidence, there was not just a proven connection, but a late and incomplete disclosure. It’s for Blucher to do it, not for the Noters to point it out.
And [ ed: next word indecipherable] ..2020, 2021: he should have thought about what might be thought.
And report by Lee Manning in brand evaluation, CVA strategy. A considerable irony: Manning was Joint Administrator in Millwall, and the Respondents had complained , not to retain Manning. Now they seek to rely on his submissions.
I’m happy for your Lordship to read the whole [ed: can’t read the scribbled word] but it might be ‘thing’]
They can’t cherry-pick.
Lord Tyre: Why not cherry-pick? If you’re right, we have Christie making a point about brand which Manning doesn’t… On Mr Blucher,, [ ed: if he continued, I missed what he may have said. I have a number of dotted lines indicating that there were exchanges that I missed in terms of note-taking for some minutes because I had lost the thread . I next have
McBrearty: more generally, not surprising that questions arise later. “ Rangers is a social, political, footballing, religious phenomenon”
Redundancy, sale of players etc. One fundamental response. There was no proper preparation. Both the Administrators and David Grier had been involved for a year before. “ Crazy to wait for appointment before preparing” [ed: this seemed to be a quote from the text of an email]
Upthehoops 15th June 17.00.
Simply not true i’m afraid.
Amounts borrowed were as follows.
Rangers £3,200,000
Aberdeen £ 3,119,000
Motherwell £ 2,959,000
Hibernian £2,882,000
Dundee U £ 2,818,000
St Johnstone £ 2,600,000
Kilmarnock £ 1,828,000
Livingston £ 1,783,000
St Mirren £ 1,764,000
Ross County £ 1,158,000
Hamilton £ 1,151,000
Celtic Nil
Albertz11 20th June 2021 At 10:07
where did you get the loan amounts from Albertz. they total over 25 million pounds. The spfl loan allocation from scotgov was 20 million. Source?
My post of 20 June refers:
I give below the continuation of my report of the last day of the BDO v RFC 2012 (IL) case
I pick up from Mr McBrearty’s words:
Continuation of the Friday 18 June 2021 hearing of BDO v RFC 2012 plc.
“ Crazy to wait for appointment before preparing- cash flow deficit of £ 3 million. Took over 3 weeks to agree wage reductions.
If properly prepared, there was no reason not to make a plan of redundancies. The 16 February meeting with the regulatory bodies the SPL and SFA …
Lord Tyre: The arithmetic, player and non-player savings, didn’t create a deadline of 31 May…the question, are there separable bits of it? If the Administrators should have made the players redundant would the same savings have been made?
Mr McBrearty: There is no evidence of any comparison being carried out. They didn’t give proper consideration to non-playing staff , two and a half weeks in, by which time they were nearly ‘unbuyable’.
To answer your question, m’Lord, the point we make in para 86/87 of the Respondent’s submission, £2.5 million against £2.848 million player redundancies [ four]. Instead of keeping the club’s value, they made it nearly unbuyable.
Lord Tyre: It wasn’t exactly a secret , every club knew what was going on? Once the deadline was in place , that shifted power to potential purchasers?
Mr McBrearty: Ashworth- the advantage of not waiting for ‘window’ to open, Rothbart …Pethybridge ..[ed: these are witnesses who had given evidence relating in part to transfer/sale possibilities during closed window periods]
The quantification of redundancies- Your Lordship has the figures, they’re in the schedules.
Lord Tyre: I looked at the schedules yesterday..I think I’ve got an understanding.
McBrearty: p116 of the Respondents’ submission- a credit for those players who were retained ,against savings?
Lord Tyre: I think we’ll break now, till 11.45.
After the break:
Mr McBrearty resumed: We see Paul Clark throwing up his hands saying “ we can’t sell Naismith because the bidders will drop off” We see the clubs to which players would go… Norwich…. It’s unlikely that McGregor and Whittaker would not have gone. Naismith didn’t have it in mind that he might become a free agent.
The respondents are a bit unfair on Mr Lombardi [ed:he had been a witness ] He wasn’t saying what a player would sell for, but indicating a starting point. Pannick wouldn’t value, the Respondents put the buy-out clause in.
So that’s all I have to say about player redundancies etc.
On the bidding process, a better bid for the ‘whole assets’ or separation, whether all of the individual failures.. I mention the inheritable property gives a good idea…. They should have sought a valuation..
The Respondents’ response is weak., see p 121 [ed: the Judge reads it to himself]
Lord Tyre: Yes..
McBrearty: In my submission that’s not an answer to the charge of negligence……what was lost ,in my submission, the Respondents make a great deal more of the hurdles.
Mr Hutchison was giving property advice..
Lord Tyre:[quoting] “ yes, but give me a year or six months” at 11 May??
McBrearty: Mr Rothbart was a bidder.If the Administrators had worked pro-actively..
Lord Tyre: Buchler dismissed Rothbart’s figure of rental? Any evidence?
McBrearty: Ashford’s figure is £1-1.5 million.He carried out a detailed analysis of premier league club rentals
Lord Tyre: Rothbart included a buy-back option. Was this significant? I can see the potential difficulties whether for the owner or fans. Does buy-back have significance?
McBrearty:Hutchison says it was an attractive part……Leeds United buy-back. Buy-back doesn’t necessarily mean separation for ever. Why wouldn’t they test the market? And Murray Park?- there was a market that included accommodation of Rangers’ needs.Murray Park separate..
Lord Tyre: The interest of fans was not the benefit of HMRC: what’s in it for the fans for their contributions?
Mr McBrearty: [ed: quotes Mr Dingwall] “ In order to save the club we’re looking to get an increase by selling Ibrox. The fans were not unrealistic: if that wss the option, then yes ”
Lord Tyre: There is a difference between having shares and having ownership of heritable property?
McBrearty: Yes. It’s a novel approach, as Mr Hutchison agreed.There was a real chance of generating…
Lord Tyre: I would have an uneasy feeling about Ibrox being owned by ten thousand people.But there could be a vehicle..I’m just raising the possibiity of probems if the owner of the stadium went a different way from the owner of the club.That’s why the buy-back?
McBrearty: There’s a vehicle just now for buying shares.[ ed: he did not mention Club 1872, but I infer that that was the reference]
On the matter of brand, the only point I haven’t covered, in terms of value – Forbes said £20 million, but £16 million in the Jeffrey report.It would be naïve to imagine that Green would be surprised at the value of the brand. The brand monumentally important.
Bidders know what they’re buying.The Administrators did not know what they were selling:Ibrox didn’t have redevelopment value , the brand drives everything.The stadium is just a place to accommodate 50 000 people, players come and go, take all that away and you are left with ‘the brand’
Lord Tyre: I’m conscious, of time, Mr McBrearty: you can have till quarter to one.
McBrearty: Thank you, m’Lord, I’m nearly finished. Even at £10 million .. In Liquidation: the valuation is not going to be loston Liquidation.And another connection between brand and property?
On the Craig Whyte shares:the strategy was flawed.The Administrators had already been involved for a year before appointment. They regarded Whyte as untrustworthy and slippery. So, on the question of a mandate? Why not ask for a mandate?
Instead they’re forced to rely on …they have undifying conversation for an officer of the Court, disclosing details of the bids of others
So a mandate should have been asked for. If that failed, then legal advice should have been obtained on it on day one.
There were other conversations within the Administration team, pointing up issues that were not being dealt with.
Bidders were vying to get the shares from Craig Whyte.The Blue Knights fell, the Singapore consortium fell…
On 4th April there were three bids of aroud £10 million.You would expect bids to spiral upwards, in a properly handled bidding process.
I’ve nothing else to add, m’Lord, except to hope that you’ll make a reference to Aberdeen!
Lord Tyre: [ he made some pleasantry about mentioning Aberdeen, then] Mr Young?
Mr Young QC: thank you, m’ Lord. First, my prayer of note to be reviewed, and before lunch the expert report..
the admissability of Mr Buchler, and Mr McBrearty’s objections.M’Lord, we had a number of case appointments but there was no objection at those stages.What happened was that Mr Buchler was approached and did mention that he did have dealings with Whitehouse and Clark. The Agent had no difficulty in January. On 19th February it was realised from Whitehouse’s report that there had been an omission.It ‘s an administrative failure.
Lord Tyre: Even after the disclosuret there were disclosures that were not made.Did he disclose the joint appointments after?
Mr Young: Not the joint appointments.His recollection.. [ ed: I think the next words may have been ‘failed him’]
Lord Tyre: I’ll have to arrive at a judgment on that.There will be more to my assessment:I will get the tone of his report
Mr Young: Before I leave that, m’Lord, I refer to Mr Manning.He had in 2012 been advising HMRC in relation to the Rangers case
Lord Tyre: Yes
Mr Young: Buchler, criticism of him. There is no doubt that he would use a phrase such as “I would not have done that”.But if you look at the whole, he gave reasons, and on what factual basis he was looking at [ p 419(1) of the Notes], in relation to the SPL football creditor issue.We referred to that in 2012 and D&P had sought advice then.Buchler had a basis for looking at that.
I concede that in commenting on Naismith’s injury he went outwith his own role.
I comment on Mr Christie’s evidence and there are issues to be highlighted:first, his experience of Football Administrations is very limited. On all of the football issues he couldn’t help the Court.He was limited to Portsmouth document. Limited value.
Secondly, his evidence shifted between his report and his oral evidence. In essence his reports show that he thought the attempted progress of sale via a CVA was inexplicable.But his oral evidence changed, when he said that there was no undue evidence of change of focus……And that mirrored a shift in the Noters’ evidence, where they were happy to keep the CVA on the table so that players would not realise they could walk away as free agents.
Lord Tyre: I think we’ll stop for lunch at ths point. Adjourn until quarter to two.
On resumption at 1.45,
Lord Tyre: Mr Young?
Mr Young: The witnesses, Mr Clark and Mr Whitehouse.
There were criticisms of Mr Whitehouse’s long answers, ‘mini submissions’.What cannot be underestimated is the whole profound effect on both Clark and Whitehouse of the criminal action et cetera for the last decade or so.
This case was the first opportunity for them to give out what happened..
Lord Tyre: The events are a year before the Administration.
Mr Young: Other criticisms : ‘recollections’ or ‘reconstruction’of evidence.They are so immersed in litigation, perfectly understandable.The Court has a huge volume of documentation and can test whether anything is ex post facto or not.
There were other criticisms of Whitehouse as of being confrontational, but he is naturally robust.
Hart as ‘unreliable’ bordering on the incredible-he was speaking only of non-player redundancies.
He was also criticicised as being ‘mocking’.
Lord Tyre: His tone of evidence didn’t match the email content?
Young: there was [ed:I missed what he said}
Lord Tyre: I’ll look again.
Young: Walder unreliabe? Not so much as not very helpful one way or the other.
Lord Tyre:Why he found it appropriate to be uncooperative? At best I will not be attaching much weight to his evidence.
Young: Mr Pannick and Mr Wynne had the same reason for producing alternative values.
The property experts were instructed only to comment on sale and lease-back, and no alternative use of Murray Park
The Noters’ case has evolved and developed, for example, the CVA approach. One of the criticisms was that a CVA should not have been used. But that had changed.
The issue of the CW shares had gained prominence and also the brand claims developed.At face value,brand and heritable property 6-12 months at maximum, and maximising fans grouping
But at the beginning, very widespred plans to get things done. Dickson’s evidence …
And the Noters have not addressed the cost of running beyond 2012
Other comments I make are about how the Noters focus on the reason for a particular strategy or action, whether there was a good reason.But in for professional negligence, you’re looking at the result of actions taken.Was the action something that no reasonably competent Administrator would take?One has to be very careful not to focus…[ed: I’m not sure whether he finished the sentence and I missed it, or whether he stopped at that]
A final broad point:is just to look at how they deal with the fans. If the Administrators had done as suggested, there would have been a huge backlash . For example, if you made 24 players redundant and half of the non-playing staff, and yet you want to be going back asking fans if they want to buy Ibrox? Inconsistent.
The phone lines were being jammed even about who was going to buy the club.The idea that one could…
Lord Tyre:In practical terms, how did the fans react to the outcome? The Administrators knew to expect reaction-it’s part of the job?
Young: I’m not suggesting that the Administrators could allow the fans to take over. But the consequences of decisions have to be considered in the light of further actions they want to take., that the heritable property would be sold to the fans for more than £5.5 million, that the fans should raise the money. That assumes that the fans would not realise that they were paying more than they need. An unattractive proposition.
Mr McBrearty spent some time on Hunter v Harnley. 2.14 of the Noters’ submission: it may be that a simple test of common sense but one has to be careful. An administration is unusual, expert evidence should be involved. Eg, pages 8 and 9 of the Respondents’ submission, what the Courts did, were helped by expert evidence.
Exposure to the market was normal.
Player redundancies, the list: the Noters describe the report of the Respondents as showing wild swings of strategy. That is not a fair categorisation of their strategy. There were two mechanisms-involuntary redundancies or wage reduction. I don’t accept that they did not know.
There’s an error in 5.1 of the Noters’ submission.referring to the Joint Administrators’ justification of…..[ed: ?] but contemporaneous documents [JB 2, 3757] do show two scenarios, One, wage reductions, saving around £1 million per month, but retaining the substantial value of the squad; two, deep cuts in the playing squad “ 15 or more top players..”
This was not ex post facto rationalisations: Retaining the playing squad was in their minds.
“ noticeable that never re-visited”: but certain ‘sensitivities’ discussion. So it’s wrong to say there was no cost benefit analysis. Shipperlee was taken to this and….page [?] in JB 2494 an email of 8 March referring to ‘sensitivities’.
P 5.1.6, top of page 32 “Mr C expressly … Mr c was asked ‘ wage cuts v redundancies plus player sales “
p.5.24 page 35, , p5.30 page 38: “ no consideration of advantage of..’
Bill Miller wanted to get the bulk of the squad.Had the club been taken over as an SPL club….
para 5.51 suggestiont hat the fans would not come was a factor that the Administrators thought relevant
Was what Christie was proposing practical, with depleted squads?One might have gone to the SPL for assurance but if Admnistrators were , 5.53, 5.54 football debt issue? The evidence of the SFA that was being relied upon was that there was a de facto rule, and if one accepts that there is a de facto rule then that’s a relevant factor for the Administrators.
And ‘question of judgment’, p116 p63: Salaries and benefits actually paid……..Noters now accept £1,253,852, next, accepted by Mr McBrearty, some credit for wages £1,411,346 , total sales
£20, [?]19,409 that 10 players would have been paid over three months, actually paid £16,[?]08,463
the difference is the savings that would not have been made if the redundancy process had been adopted.
[ ed: I was totally bemused by this time, figures being rattled out at speed, so I stopped trying to jot them all down, and picked up again, when Mr Young arrived at ..]
wage reduction was a better route than redundancies.
Proposition, if redundancies are less expensive and …[ ed:missed a bit]
then either option is acceptable.
I don’t accept that the redundancy route had to be taken because of the deadline of the wage reductions which put pressure on the Administrators. The pressure was on already on.
The Craig Whyte shares: Althouh Lord Hodge’s decision had been given, the Administrators still couldn’t deal with things until they knew what the bidding was like.
Moving to player sales,para 9.5 on page 59,quantum, sale price, total price – sale price is not agreed by the Respondents.
Mr McBrearty’s question of ‘what’s the downside’– you’ve asked for bids, bids come in, and then you start selling? You’ll affect the bid. If a clear sales policy on 5 April, what would the Joint Administrators do when on 24 April a registration ban is imposed?Not to be able to purchase in the summer and the following window? You’d immediately have to roll back from player sale strategy. Even if you moved to such a strategy you’d only have a very short window to replenish.
The lower the price the sooner the sale? But players had buy-out clauses, their prices were lower and there was still no interest.
Another point on player sales: We talk about fair valuation or Mr Lombardi’s. Mr McBrearty talks about cross-check. Caution, once you get into Administration value drops, , Jelavic-the estimate for him was far higher than his sale price- which was largely deferred.
Naismith- I don’t accept that he was a near certainty to go to WBA.
There’s odd elements in Ashworth’s valuation: he couldn’t why he did not offer £2 million instead of £1’7 million.Maybe by mid-April , we know that an asset sale was a possiblity and that they didn’t need to transfer. He knew that Naismith might be a free agent, and he could sit on his hands and see what happened.Would Naismith agree to personal terms?His own evidence was a “ master class of saying not very much”, but it makes sense for Naismith to sit and wait., so there might have been a 20% chance of moving on transfer.
20% deduction on fee? For agent?
Lord Tyre: Shall we have a 10 minute break now?
Resumption at 3.07.
Mr Young: Peter McLean ‘orchestrating’? [ed: transfer to WBA] Just what a good agent would do.It does not imply that that was where Naismith or the agent want to go.There were no other approaches at the time.
Turning to the bidding process in general: p711 of the Noters’ submission:that because Ticketus had the shares the number of bids would drop. But Ticketus were willing to offer the same terms to others ,see JB 3, 4416, email of 10 April 2012.
Ticketus were trying to ride as many horses as possible. The Blue Knights had a joint offer, and the Singapore Consortium had bid. It’s quite wrong to imagine there was only one bidder for a CVA.
The mandate issue, this was not discussed in the expert reports…the pre-appointment position of Administrators?-it’s doubtful if that places an obligation on them.There will be cases where Shareholders are uncooperatve until Administrators are actually appointed. Mandates are not the norm.
But even with a mandate the evidence is that a CVA was scuppered anyway. £8.5 million CVA voted down by HMRC , it was not likely that HMRC would vote for £10 million CVA.
Even if Singapore dropped out, it could have dropped out because of the SPL etc.
Indicative submission, p 6.89 (4) ,page 10 “ the level of indicative bids was £4 million to £25 million. I have to accept that Buchler gave a figure near to Christie’s, in terms of practicalities
Mr Timney and Mr Plum accepted that sale and lease-back was possible but probably difficult.
Timneyhas experience of Bank of Scotland/Lloyds, he thought he would have had a hard time trying to pitch a sale and lease-back. Plum thought the market not sufficiently mature.Mr Paul thought that lease and sale-back would have been last option.
And the fans’ interest was in shares rather than the stadium
Lord Tyre: A no-brainer that fans would want to protect for the future?
Mr Young:the general view is that fans would do anything to save the club. But the timing ….? and if the club by that time was already saved? Para 6.16(2) of the Noters’ submission, last sentence “ Clark rejected fans’ funds ”( Joint Bundle 2, p3760) an email where Clark is explaining to Andy Kerr that money raised {ed: missed a bit] …….. and at the end of the day the creditors got the money.
As for third party investment, for example, Rothbar: I would caution m’Lord.That offer was from one individual who understood that Murray Park had planning potential. His proposition was to sell Murray Park for development and rent being guaranteed by Capita. We have Rothbar’s letter. It does not advance the position.
The buy-back clause would be more attractive, the point is that such a clause would dictate what a landlord would want.
Lord Tyre: The purchase price plus a percentge per annum?
Mr Young: but if the purchase price of buy-back is not known?
Lord Tyre: Yes
Mr Young: Difference [ed: missed a bit] inheritable prop was never tested
‘brand’ is slightly different -the market was tested BM and CG were well aware of the brand, If the brand was actually tested, there was no need for separate valuation.
And ‘duty’? Evidence of what happens in general as opposed to football clubs as regards brand. Not like Debenham’s.
Lord Tyre: as happened.
Mr Young: Can’t just attach brand to an under 19 boys’ club and lo and behold it’s ‘Rangers’.
Unless you have any other question, m’Lord, I have nothing more to add.
Lord Tyre: Thank you.
Mr McBrearty: the reference to fans’ giving is Ian Paton.
And Gordon Christie, I'm not accepting that he changes his position. That's unfair. , his supplementary report, 2.22-2.24, 2.32, 3.38.
And de factor creditor rule, relies on Regan, but he did not come to speak to his evidence.
Lord Tyre: Thank you. I have no further questions.
The Judge then thanked Counsel, and witnesses, Mr Hyde, and the transcriber, the Court staff and everybody else.
He will give his judgment as soon as he possibly can
+++++++++
Can I correct a correction? Bulcher’s name is indeed Bulcher. My Napoleonic war history made me think of Blucher!
Buteo Buteo 21st June 10.17.
The amount of loan funding was increased to £25 million this year.
Gilmour out of Croatia game!!!!
Positive for Covid
HS
@HS – got to feel for the boy.
Is it just me or does Scotland’s record for COVID instances in their bubble poorer than other nations?