Time for Scots Government to Take Bull by the Horns

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There seems to me to be a fairly simple way …

Comment on Time for Scots Government to Take Bull by the Horns by HirsutePursuit.

There seems to me to be a fairly simple way of sorting this out.

Forget, for a moment the issue in terms of titles. Think instead in terms of prize money.

The SPFL board have a fiduciary duty to ensure that its shareholders interests are protected.

If prize money has been paid to a member and it is later established that the club had been cheating, that prize money can lawfully be reclaimed and reassigned to its rightful owners.

The SPFL should be making a claim against Rangers (IL) as an unsecured creditor for an amount equal to all prize money paid to Rangers (IL) during the EBT years.

Clubs that have been underpaid (due to the overpayment to RFC IL) should now be seeking payment from the SPFL of all outstanding sums.

Assuming the SPFL submits a claim with the liquidators, it will have complied with its fiduciary duty to achieve the best result for its shareholders – even if the sum ultimately achieved is no more than a couple of pence in the pound. It is unlikely, in these circumstances, that the SPFL itself could be held liable for the difference.

However, if the SPFL makes no claim with the liquidators, it may well be leaving itself open to claims from individual clubs or groups of clubs for the entire amount now owed to each.

The amounts owed to Celtic and probably Aberdeen, Hearts and others could well be in the millions. Most other ex-SPL clubs will be owed six figure sums.

The difference between finishing second and third was huge. For example, Livingston, who finished 3rd in 2001/02 may have lost out on 1/2 million on that season alone.

The SPFL simply cannot afford to do nothing.

HirsutePursuit Also Commented

Time for Scots Government to Take Bull by the Horns
It’s probably worth pointing out that the SFA cannot effectively sanction a club that is in liquidation and is no longer a member of its association.

Of course, the SFA is an association of members. Only clubs and affiliated associations can be admitted as members. The Rangers Football Club PLC and The Rangers Football Club Ltd (formally Sevco Scotland Ltd) are different clubs and cannot be treated as a single entity by the SFA.

My interpretation of today’s statement is that:
1. The ex-SFA member known as Rangers FC is not capable of answering any disciplinary charges put to it. It may even be dissolved before proceedings come to a conclusion.
2. As it did not exist at the time of the offences there can be no question of charges against the current member using the same name.
3. Even if the former member was found guilty, the only realistic sanction available to a Judicial Panel would be a financial penalty that would ultimately be of very limited value.
4. The responsibility for managing SPL games and competitions lies with the SPL (now SPFL). Only the SPFL can take sporting sanctions against the original Rangers FC for its failure to follow the correct registration processes.
5. As the SPL/SPFL has already ruled on this matter, it is that organisation that must consider if the LNS decision should be reconsidered.

My own view is that the circumstances of this debacle require a completely external review of the SPL’s remit and processing of the LNS Commission.

As I have said before, LNS decided (or was told) that the commission must be adversarial (like a trial) rather than inquisitorial in nature. This meant that, without conducting its own research, the commission could accept as fact those elements of ‘evidence’ that were agreed by both sides. As the continuity myth was financially beneficial to both the SPL and Sevco Scotland, it became a ‘fact’ of the commission that Rangers FC continued despite a change in owner and operator.

He presumably did not know that the SPL articles he confidently quoted in support of the absurd notion that club and company were separate entities did not exist until 2005.

Similarly, the commission could accept the idea that the EBT arrangements were legal in all cases. Ignoring completely that there was an outstanding and agreed debt on the original DOS scheme and that a number of the later EBT payments were already found to be ‘irregular’.

With no appetite to ‘strip’ titles, the interpretation of improperly registered players being nevertheless eligible to play in official matches was not properly tested.

I could go on…

The SPL/SPFL cannot honestly revisit the LNS Commission decision unless it opens itself up to unwanted scrutiny over its remit and delivery.

I wish I could believe it will happen.

Recent Comments by HirsutePursuit

Who Is Conning Whom?
I am with you in most of what you say, but there are some important differences.

SFA Article 6.1 & 6.2 say:

Clubs or associations undertaking to promote Association Football according to the Laws of the Game and these Articles and other rules of the Scottish FA may be admitted as registered members, associate members or full members, subject to the provisions of Articles 6.2 to 6.7 (both inclusive).
6.2 A club or association shall be admitted as a registered member automatically by reason of its being admitted as a member of an Affiliated Association or an Affiliated National Association, or in the case of a club through membership of or participation in an association, league or other combination of clubs formed in terms of Article 18 and in the case of an association by being formed in terms of Article 18, provided it is not already an associate or full member. A registered member shall not be a member of more than one Affiliated Association or more than one Affiliated National Association. A registered member may apply at any time to become an associate member.

We are in complete agreement, I think, that SFA Article 6.2 made Sevco a registered member of the SFA from the date it was accepted by the SFL – 14th July 2012.

But, and I think this is important, the nearest the SFA get to insisting that a club has associate or full SFA membership is Article 6.2 which simply says, ‘A registered member may apply at any time to become an associate member.’
Note: no timescale applies… and no consequences (from an SFA perspective) if a club chooses to not make that application.

So I think we are on common ground that Article 6.2 was applicable as far as the registered membership was concerned – and Sevco did not take the opportunity to apply for associate membership by this method.

If we then go back to what the SFL Rules actually said:

6. REGISTRATION WITH SFA A CONDITION OF MEMBERSHIPA Member or Associate Member who is not already a full or associate member of the Scottish Football Association must make application to become a full or associate member of the Scottish Football Association (as the case may be) within fourteen (14) days of being admitted to membership of the League failing which its membership of the League will lapse, and in the event that the application is unsuccessful, its membership will lapse upon that decision being intimated to the League.

Now, if the SFL was being prescriptive about which SFA Article was to be used (to apply for full or associate membership), and that Article 6 was the only valid route, why mention full membership as an option. If ‘application’ is meant to mean only applications in terms of SFA Article 6, the only relevant option would be to apply as an associate SFA member.

No, the SFL rules are not prescriptive in the manner of that application. I think Rule 16 is clearly written to allow a transfer of associate or full membership from an existing club to a new club or entity under SFA Article 14. 

In fact the only method by which this could be achieved is SFA Article 14

14. Prohibition on Transfer of Membership14.1 It is not permissible for a member to transfer directly or indirectly its membership of the Scottish FA to another member or to any other entity, and any such transfer or attempt to effect such a transfer is prohibited, save as otherwise provided in this Article 14. Any member desirous of transferring its membership to another entity within its own administrative group for the purpose of internal solvent reconstruction must apply to the Board for permission to effect such transfer, such consent not to be unreasonably withheld or delayed. Any other application for transfer of membership will be reviewed by the Board, which will have complete discretion to reject or to grant such application on such terms and conditions as the Board may think fit.

…which allows the board to grant an application for transfer of an existing membership on such terms as it sees fit.

Importantly, the discretion only applies to which terms and conditions to a transfer of a membership that already exists.

Having complete  discretion on how or if that transfer (of full membership) took place is completely within the board’s power via Article 14.

What it doesn’t do is empower the board to create a new type of membership. 

And, even if it does claim to have done so, I still don’t understand how the SFA ‘conditional’ membership would satisfy the SFL requirement for an application for associate or full membership?

Remember, this transfer application was an SFL requirement. The SFA had no interest in whether or not Sevco applied for associate or full membership.

It seems to me that the SFA and SFL approached the Sevco scenario in a similar way as they did when Inverness Caledonian were admitted (as a new club) in 1994.

Difference is ICT, the SFL, SPL and SFA all recognise that that club was founded in 1994.

As I said earlier with regard to the birth of Sevco, the deceit is not so much in what they all did, but in what they said and continue to say.

Who Is Conning Whom?
The new club (Sevco) was issued with written permission to use the name of a club in full membership (Rangers).

This was necessary because both existed as SFA member clubs at the time.

Who Is Conning Whom?
This was the nub of the ‘conditional membership’

10.7 Each club in full membership or associate membership shall in its Official Return register its ground and playing field dimensions and no such club shall remove to another ground without first obtaining the consent of the Board. Any club in full membership or associate membership wishing to make any alteration to its name, its registered ground or its playing field dimensions must first obtain the prior written consent of the Board. No club in registered membership shall adopt in whole or in part the name of a club in full membership or associate membership without the prior written consent of the Board.

Who Is Conning Whom?
The 14 day application deadline was an SFL requirement – not something that the SFA had any locus in considering.

As long as Sevco was a member of the SFL it was a member of the SFA.

It would have been up to the SFL management committee to decide if the application for transfer (rather than application for a new associate membership) met its requirements. If it did not, it would have been within its powers to revoke Sevco’s league membership. It is an arguable point, but there is no suggestion, as far as I’m aware, that the SFL league management committee ever met to even discuss the matter.

Nevertheless, I think you are saying that Sevco was no longer a member of the SFL at the time of the SFA statement – therefore needed this ‘new’ SFA membership category to play Brechin.

But how would any type of membership of the SFA help if it was no longer a member of the SFL? If its membership of the league had already lapsed or been revoked, another SFL EGM would have been required to try and vote the club back in. I’m 100% sure that did not happen.

On 29th July, Sevco must still have been a member of the SFL as the Ramsden Cup was only open to members of that league.

There was simply no mechanism for the club to rejoin the league in the available time. If it did not rejoin (and I’m as certain as I can be that it did not) then it cannot ever have been removed as a member of the SFL.

And as I keep saying, as a member of the SFL, it was also a member of the SFA.

The SFA’s deceit was not in its actions – but was in its words.

Don’t forget that the SFA had to consider the use of the Rangers name. The ‘conditional’ membership squirrel has been particularly useful in covering up the SFA board’s approval for Sevco to play Brechin under the Rangers name.

That, in reality, was the big announcement on that day. The rest was sleight of hand.

Smoke and mirrors.

Who Is Conning Whom?
The golf club analogy has been used before.

Dear old dad is a member of St Andrews (other golf clubs are available). To make best use of the facilities new members must apply to a ‘house’ that will give access to their respective lounges and bars. After 15 years of continuous membership Mon pere was awarded the status of ‘Gold Member’.

Gold Members have their own lounge and gain a range of additional benefits. 

Recently poor old dad has become poorly and suggests that l join the golf club and take over his ‘Gold Membership’.

I join the club and, with a letter of agreement from sickly pater, apply for the transfer of his ‘Gold Membership’ status.

The committee meet and decide that I can only take on the enhanced membership status if old pop dies.

I tell them that father is on his last legs and won’t last the weekend.

As an existing member I can enter the club’s Saturday medal competition. On a conditional basis, they tell me I will be eligible to use the ‘Gold Members’ facilities. They issue me with a letter to confirm this arrangement.

They will reconvene in several weeks to confirm the transfer of membership status – assuming that by then papa will be gone. If he makes a miraculous recovery I must then apply to join one of the standard houses.

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