Highlights of the Opinion by Lord Nimmo Smith’s Commission
The “EBT” charges cover a period from 23rd November 2000 to 3rd May 2011.
This includes a charge of fielding ineligible players.
There is a further charge against Rangers (In administration) for failing to co-operate after March 15 this year, which is capable at the very least of causing Duff and Phelps embarrassment.
There is a clear distinction between the Independent Commission set up by the SPL and the SPL itself.
No fair-minded and informed observer would consider the possibility that the Commission or a member thereof was biased.
Rangers dropped the bias argument before the hearing on 11th September.
Mr Green has said the SPL refused to reply to his lawyers.
The Commission says that the SPL’s lawyer did so by letter and in numerous emails.
Which of the two statements above is correct?
Oldco and NewCo were going to turn up, represented by the same lawyer, to argue that the SPL had no jurisdiction. At the last minute they declined to attend.
The SPL undoubtedly has jurisdiction over OLDCO.
The SPL undoubtedly has jurisdiction over THE CLUB.
The club is a separate but non-legal entity which continues notwithstanding transfer from one owner to another. Rangers Football Club therefore continue as before even though ownership has been transferred.
The SPL has no jurisdiction over NEWCO, but as it has power to impose sanctions on the club, owned by newco, newco has a direct interest in proceedings.
Therefore newco could face all of the punishments for the offences if proved, on the basis that the club it bought was guilty of them.
The administrators’ argument that this was a legal process and as such ought to be stopped without their consent failed. The case can go forward to a full hearing.
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The most clear cut and most informative analysis of the saga of Rangers Football Club (apart of course from that on this site 🙂 ) has come from the courts or from legally qualified people presiding over regulatory matters.
The opinion of Lord Hodge in the case of Martin Bain v Rangers spelled out in detail the financial perils for Rangers and included the assessment by his Lordship that Rangers faced “a real and substantial risk of insolvency if the tax appeal were to be decided against Rangers in the sums which have been discussed”.
We had the decision of Sheriff Ross in One Stop v Tixway, which blew any remaining credibility Mr Whyte had to smithereens. In that case the Sheriff said of the former Rangers Chairman “I reject the evidence of Mr Whyte as wholly unreliable. It is not possible to ascertain whether he is not telling the truth or is simply unable to recollect the true position, and has convinced himself that this arrangement is something that he would not have entered into. Either way, his evidence is contradicted by virtually every other piece of evidence.”
Gary Allan QC chaired the SFA Judicial Panel which found that Rangers and Mr Whyte were guilty of various offences against football’s rules. Their judgement laid bare a concerted campaign by Mr Whyte to avoid paying millions of pounds of taxes, which money was used to keep Rangers Football Club running as far as February (and as the administrators started with around £3 million in the bank which should have been paid to HMRC, that non-payment probably enabled Rangers to make it to the end of the season).
Lord Glennie then overturned the transfer embargo imposed by Mr Allan’s Panel and confirmed by the Appellate Tribunal under Lord Carloway.
We also had Lord Hodge’s opinion on the application by the administrators to regularise their appointment when it turned out they had failed to notify all relevant parties.
We can now add to the ever growing pile of judicial consideration the Opinion published yesterday by the SPL. This is written by the SPL Independent Commission, consisting of Lord Nimmo Smith, Nicholas Stewart QC and Charles Flint QC.
It deals with their hearing last week to determine further procedure in the so-called Rangers EBT investigation. This is the procedure condemned by Mr Green as unfair and seeking to arrive at a pre-determined conclusion.
So, now that these three legal luminaries have considered preliminary matters and issued their opinion, where does it take us?
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After referring to the appointment of the Commission, the opinion narrates some of the relevant history.
At paragraph 4 it states-
The SPL was incorporated in 1998. Its share capital consists of sixteen shares of £1 each, of which twelve have been issued. Oldco (Rangers Football Club PLC) 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”).
This confirms what seemed rather odd, namely that oldco, even though no longer owner and operator of a football team, remained a member of the SPL for almost two months after the sale of its entire assets.
Para 6 says:-
On 14 June 2012 a newly incorporated company, Sevco Scotland Limited, purchased substantially all the business and assets of Oldco, including Rangers FC, by entering into an asset sale and purchase agreement with the joint administrators. The name of Sevco Scotland Limited was subsequently changed to The Rangers Football Club Limited. We shall refer to this company as Newco.
This comes back again to the point I discussed earlier this week namely that the purchaser seemed to change from Sevco 5088 Ltd to Sevco Scotland Ltd, although this statement by the Commission does not tally with the Rangers spokesman mentioned in the piece I quoted.
Para 7 states:-
Newco was not admitted to membership of the SPL. Instead it became the operator of Rangers FC within the Third Division of the Scottish Football League (“the SFL”). It also became a member of the Scottish Football Association (“the SFA”), the governing body of the sport in Scotland. These events were reflected in an agreement among the SFA, the SPL, the SFL, Oldco and Newco which was concluded on 27 July 2012 and in this Commission’s proceedings is referred to as “the 5-Way Agreement”.
Let’s look at that again. Newco became a member of the SFL and became a member of the SFA (not that it had the existing membership of oldco transferred to it).
Para 8 summarises the definition of the notorious EBTs to be considered by the Commission. It states:-
“Payments made by or for [Oldco] into an employee benefit trust or trusts for the benefit of Players, including the Specified Players, employed by [Oldco] as Professional Players, Registered and/or to be Registered as Professional Players with the Scottish Premier League and Playing and/or to Play for Rangers FC in the Scottish Premier League and payments made by or for [Oldco] into a sub-trust or sub-trusts of such trust or trusts of which such Players were beneficiaries, payments by such trust or trusts and/or sub-trust or sub-trusts to such Players and/or for the benefit of such Players and any and all arrangements, agreements and/or undertakings and the like or similar relating to or concerning any of such Players and payments.”
Para 9 indicates that the periods covered in the “complaint” run from 23 November 2000 to 21 May 2002, 22 May 2002 to 22 May 2005 and 23 May 2005 to 3 May 2011 in relation to EBT payments and after 15 March 2012 in relation to failure by Rangers to co-operate with the SPL and to comply with the SPL Rules. Bearing in mind that this last charge is effectively levelled against Duff & Phelps, who were running the company as administrators, it makes the declaration by them that they would have nothing more to do with these proceedings remarkable. A finding that administrators had failed to comply with the regulatory body’s investigations in an industry where they were administrators would at the very least be embarrassing and at worst could have serious financial and disciplinary consequences for the firm and the partners involved.
The “charges” allege that Oldco and Rangers FC breached the relevant Rules of the SPL, and also those of the SFA, by failing to record EBT payments and arrangements in the contracts of service of the Specified Players and/or other Players and by failing to notify them to the SPL and the SFA. There is one Issue directed only against Rangers FC, alleging that the club was in breach of the Rules by playing ineligible players. The fourth chapter alleges that during the period from 15 March 2012 Oldco and Rangers FC failed to co-operate and to respond to requests for documents.
The Notice of Commission was served on Oldco, Newco and Rangers FC by letters dated 2 August 2012.
The Commission then goes on to comment on certain preliminary matters.
Independence
They state in para 10:-
It is fundamental to the constitution of a body with investigatory and disciplinary powers, such as the present Commission, that it must act independently of the person or body appointing it. We must of course operate within the terms of our remit, and apply any rules which are applicable, but in reaching our final determination of the Issues, and in making any incidental decisions, we shall exercise our own judgement, on the basis of the evidence which is adduced, in accordance with the principles of natural justice, and unfettered by the influence of the Board or of anyone else. None of us would have accepted his appointment on any other basis. We have the use of SPL premises and are assisted by SPL staff, but this is because we have given instructions to that effect; the members of staff, in particular, act under our instructions.
The Minute of the Board Meeting appointing the Commission is referred to:-
“The Secretary advised that once appointed a Commission is wholly independent from the SPL and SPL Board and manages its own process.”
The Commission then goes on to consider the position of Lord Nimmo Smith. Some have argued that his roe in an SFA inquiry into issues surrounding Rangers means he ought not to deal with this matter.
This is answered in robust fashion. Lord Nimmo Smith’s role was as part of an SFA Independent Committee. Its investigations formed the basis for the Judicial Panel proceedings against Mr Whyte and Rangers, and most importantly dealt with Mr Whyte’s period of stewardship. For all the criticism of Mr Whyte, he is not accused of paying anything out in the form of an EBT!
Once the Independent Committee report went to the SFA, the business of the Committee was concluded and Lord Nimmo Smith took no further part in proceedings. However, some say, surely he must have found things out which prejudice him!
Apart from that being a wholly offensive accusation to level at such a distinguished judge as Lord Nimmo Smith, he points out why it is unfounded as a concern.
Para 14 states:-
The topic of the employee benefit trust (“EBT”) referred to in the Issues before this Commission was touched upon in two paragraphs (and only those two) of the report of the Special Committee of the SFA, but no recommendation was made to the Board in that regard. The main reasons for not making a recommendation were: (1) the EBT came into existence several years before the period with which the Special Committee was concerned; and (2) there was in any event no sufficiently clear evidence of a breach of SFA Article 12.3 to justify any further action at that stage. Now that the present Notice of Commission has been prepared, it can be seen that there is no overlap between the period with which the Special Committee was concerned and either the period to which the first three chapters of the Issues relate or the subsequent period to which the fourth chapter relates.
Para 15 points out that newco’s lawyers did raise the issue:-
In a letter dated 23 August 2012 solicitors for Newco expressed concerns about the appointment of the Chairman to this Commission. In short, while it expressly did not allege actual bias on his part, it suggested that by reason of his previous Chairmanship of the SFA Special Committee the Chairman might not be seen to be impartial. Following receipt of this letter authorisation was obtained from the Board of the SFA – to whom the Special Committee’s report remained confidential – to disclose to the solicitors the terms of the two paragraphs of the report in which reference was made to the EBT, together with two preceding formal passages to explain the context in which it was discussed. Newco did not respond to the Commission on this point, and in the event no application has been made that the Chairman should recuse himself from these proceedings.
I turn now to Mr Green’s statement on 10th September where he said:-
“Our lawyers have made that point repeatedly to the SPL in correspondence and yet our requests for an explanation from the SPL have been completely ignored. The SPL’s silence on these issues is deafening.”
That suggests to me one of the following:-
- The Commission is telling an untruth;
- Mr Green is telling an untruth;
- Newco’s lawyers have omitted to tell their very high profile and vocal client that the Commission actually replied; or
- Mr Green is being deliberately obfuscatory in saying that the SPL did not reply, when in fact it was the Independent commission which responded.
Observers may have views on which one is most likely. I know which my money is on…
The Commission outlines the legal tests re bias as follows:-
The test for establishing apparent bias is authoritatively laid down in Porter v Magill [2001] UKHL 67, [2002] 2 AC 357, in which Lord Hope of Craighead said at paragraph 143:
“The question is whether the fair-minded and informed observer, having considered the facts, would conclude that there was a real possibility that the tribunal was biased.”
To this may be added that the “fair-minded and informed observer” is “neither complacent nor unduly sensitive or suspicious”: Johnson v Johnson (2000) 201 CLR 488, paragraph 53.
Para 17 goes on to say:-
Bearing this test in mind, the Chairman, in consultation with the other two members of the Commission, has given careful consideration to this question, and has concluded that the fair-minded and informed observer, having considered the facts, and in particular the terms of the SFA Special Committee report quoted above, would not conclude that there was a real possibility that the Chairman was biased. The main reasons are, as already indicated, that: (1) those of the present Issues which relate to the EBT arise from a period which ended before the period with which the SFA Special Committee was concerned; and (2) not only did the SFA Special Committee not reach any conclusion about the EBT, it did so because there was insufficient material to enable it to reach any conclusion. The mere fact that the Chairman has reached conclusions adverse to Oldco on another occasion in respect of other issues does not preclude him from continuing to act as Chairman of this Commission, any more than a judge would be precluded in comparable circumstances in court. The Chairman therefore sees no need to recuse himself and that view is shared by the other two members of the Commission.
Para 18 then says:-
The question raised as to the position of the Chairman was not referred to again in correspondence after the release to the solicitors for Newco of the relevant passage from the report of the SFA Special Committee. More importantly, it was not mentioned in the list of preliminary issues which we discuss below.
This statement might have a bearing on the assessment of the veracity of Mr Green’s statement referred to above.
Procedure So Far
After detailing various procedural steps, the Opinion continues:-
[The Chairman] directed that a hearing into the Issues set forth in the Notice of Commission, and any preliminary issue, take place on 11 September 2012 and following days.
The order continued:
“Any preliminary issue, in particular the issue of jurisdiction raised by Messrs. DWF Biggart Baillie on behalf of RFC 2012 Plc (in administration) by letter to the Secretary dated 17 August 2012, will be heard and determined before any hearing on the merits of the Issues. For the avoidance of doubt, in the event that the Commission determines that it has jurisdiction in respect of the Issues, any hearing on the merits of the Issues will take place immediately following such determination.
So the jurisdiction issue had been raised. A hearing had been set to deal with the issue. It would be dealt with before the substantive matters. This is a common procedure in court cases where a fundamental preliminary point, such as one about jurisdiction, is raised by or on behalf of a party.
Para 21 states:-
In the course of a letter dated 15 August 2012 on behalf of Newco Mr McLaughlin (of DFW Biggart Baillie) disputed the jurisdiction of the SPL, and thus of the Commission, in relation to Newco and Rangers FC. He stated that Newco would not be in a position to decide whether or not it was necessary or appropriate for it to appear or be represented before the Commission until he had been provided with clarification in relation to these matters. By letter dated 17 August 2012 Mr McLaughlin stated that he acted for Oldco and that he had been instructed to advise that Oldco wished to appear and be represented before the Commission. The letter also disputed that the SPL, and thus the Commission, had jurisdiction in relation to Oldco and Rangers FC.
Mr McLaughlin was therefore acting for both oldco and newco. Was this a conflict of interest? As matters stand, I do not think so – there seems to be a singularity of mind between Mr Green and the administrators. The mere fact that a solicitor acts for more than one party in a matter is not necessarily proof of conflict. As I have commented before, the legal definition of such a conflict is actually far narrower than the public perception of the issue. No criticism of Mr McLaughlin or his firm is intended nor should any be inferred from what I say above. In fact it could be argued that the dual instruction would reduce costs payable by the administrators and thus they are acting in the interests of the creditors by reducing costs to the bankrupt company.
By letter dated 23 August 2012 Mr McLaughlin, on behalf of Newco, wrote:
“Purely to preserve any position that may require to be protected in this matter my client wishes to be regarded as a respondent as defined in paragraph two of the orders for the time being. This should not in any way be regarded as an admission that the SPL has any form of jurisdiction over my client in respect of this and/or any other matter or that my client [sic]. It has ‘entered appearance’ simply to allow the preliminary jurisdictional issues to be resolved.” (Italics in original)
Among other concerns, the letter raised the question of apparent bias on the part of the Chairman already discussed.
By letter dated 24 August 2012 Mr McLaughlin, on behalf of Oldco, stated:
“Having reflected on your process as a whole following on from receipt of [the Chairman’s] orders my client is now firmly of the view that the Commission constitutes a legal process pursuant to Paragraph 43, sub paragraph 6 of Schedule B1 to the Insolvency Act 1986 and accordingly it can only be progressed with the Joint Administrators’ consent or with leave of court. My client does not give its consent. … Accordingly, the orders of the Commission dated 20 August 2012 must be vacated unless and until such time as leave of court has been obtained.”
The Commission referred the matter back to the SPL, as it would be the body requiring to seek court approval, if the same was considered necessary.
By letter dated 27 August 2012 Rod McKenzie of Messrs Harper Macleod LLP, Solicitors, on behalf of the SPL, replied to Mr McLaughlin’s letter, setting out a contrary argument. In addition to these letters, numerous emails were being exchanged, some of which the Commission have seen.
Again returning to Mr Green’s statement, he said:-
“Our lawyers have made that point repeatedly to the SPL in correspondence and yet our requests for an explanation from the SPL have been completely ignored. The SPL’s silence on these issues is deafening.”
So maybe Mr McLaughlin only received these emails and letter as Oldco’s Lawyer, and not as Newco’s lawyer? Maybe he felt that he ought not to disclose to newco that he had received replies, including “numerous emails”, to his correspondence?
This seems familiar to the situation earlier this year when Mr McCoist demanded that the identity of the Judicial Panel be revealed, when in fact colleagues of his within Ibrox had been aware of the identities before the hearing and had sat in the room whilst the case was being dealt with. In that case Mr McCoist could have strolled along an Ibrox corridor to find out what he demanded publicly. Maybe here Mr Green should have asked Mr McLaughlin, his lawyer, if there had been any response before decrying the SPL for a failure to reply?
Or else he is being 100% accurate in his words, in that the SPL did not reply, but the SPL’s lawyer did?
The Chairman then made an order regarding further procedure:-
1 The hearing to commence on Tuesday 11 September will consider all jurisdictional and procedural issues raised by the parties and give all necessary case management directions for the determination of the substantive issues. Two days [have] been allowed for this hearing.
- The parties should exchange and serve on the Commission by 4pm on Friday 7 September outline arguments identifying all the issues to be raised at the hearing commencing on 11 September.
- Subject to the outcome of that hearing, the Commission is minded to fix the substantive hearing for 13 – 16 November, with 20 and 21 November available if required.
- Subject again to the outcome of the hearing on 11 September, the Commission is minded at that hearing to make a direction that the SPL serve an outline argument (to the extent that such argument is not covered by the outline argument referred to in paragraph 2 hereof) which should:
(a) Set out by reference to a small number of example cases the precise facts which constitute the alleged breaches of the Rules or SFA articles;
(b) Explain which persons are alleged to have been responsible for the making of the EBT Payments and Arrangements, without disclosing them in the contracts of service disclosed to the SPL;
(c) If it is alleged that any entity or person other than The Rangers Football Club Plc (ie. RFC 2012 Plc (in administration)) is subject to sanction under Rule G 6.1, set out a detailed legal argument addressing the rules of the SPL and the general law explaining how such liability arises.
5. In the meantime the parties are not required to comply further, and to the extent that they have not already been complied with, with paragraphs 4, 5 and 6 of the directions issued on 20 August.”
On 5th September 2012 Mr McLaughlin wrote to clarify the position of Newco in relation to the preliminary hearing. He raised again questions of jurisdiction – which were of course to be considered at the preliminary hearing – and stated:
“Newco is prepared to appear and be represented at next week’s hearing because as SPL Limited’s own correspondence recognises, it has an interest in any process that purports to involve business and assets which it acquired from Oldco, namely Rangers FC.”
Enclosed with the letter was a document entitled “List of Preliminary Issues for Determination”, containing eight paragraphs. In addition to this, by email dated 4 September 2012, Mr McLaughlin stated that he would lodge and intimate a bundle and a Note of Arguments on 7 September 2012. In the event this was not done
Para 27 states:-
The Commission expected that both the SPL on the one hand and Oldco and Newco on the other would be represented at the hearing on 11 September 2012. During the afternoon of 10 September, however, letters were received from Mr McLaughlin on behalf of both Oldco and Newco stating that he had been instructed by each of them that it would not appear or be represented at the preliminary hearing and did not intend to take part in any further procedure. The letters reiterated the argument about jurisdiction which had previously been made and was reflected in the list of preliminary issues, and which was of course due to be considered the next day
So, having raised the issue of jurisdiction, and having had a session set aside to decide it, Oldco and Newco took their ball home and refused to play. It is also noteworthy, as recorded by the Commission, that no accusations of bias were out forward in the List of Preliminary Issues.
This seems very odd, as Mr Green, a few days later, made a great song and dance about bias and lack of independence.
In addition, it is a legally risky tactic to raise an issue about jurisdiction and then to refuse to attend to argue it. It places any appeal in jeopardy. If Rangers “lose” in these proceedings and were to seek the protection of the court in an appeal, then it would be argued that they had failed to engage with the process and to “exhaust their remedies” prior to going to court. When a party decides deliberately not to come to court, it makes it very hard to argue about what happens in its absence!
After explaining why the hearing had continued in the absence of newco and oldco, as permitted by the rules, para 29 states:-
In the course of the hearing we had regard not only to the outline argument for the SPL, as developed in oral argument by Mr McKenzie, but also to the arguments as set out in Mr McLaughlin’s letters and as focused by his list of preliminary issues. We ensured that Mr McKenzie’s contentions were thoroughly tested, at least as rigorously as they would have been had Mr McLaughlin appeared. The hearing lasted for a full day, and we adjourned overnight to consider our decision.
I am sure the suggestion is not that Mr McLaughlin would have been an unnecessary participant! However, bearing in mind the issues raised, and the calibre of the Commission members, I have no doubt that there would have been a very detailed and through analysis of the legalities before the Commission arrived at its decision.
That decision was as follows:-
“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:
- 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.
- Oldco and Rangers FC, who are named in the Issues contained in the Notice of Commission and alleged to have been in breach of 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.
- Newco, as the current owner and operator of Rangers FC, although not alleged by the SPL to have committed any breach of 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.
- Written reasons for this decision will be made available in due course.”
The Opinion then expands upon that decision.
Jurisdiction
Para 31 states:-
As has been seen, one of the main preliminary issues which we have to consider is whether the SPL, and thus this Commission, has jurisdiction in relation to Oldco, Newco and Rangers FC. At the outset, Mr McKenzie accepted – as he was bound to do – that the SPL has no direct jurisdiction in relation to Newco: Newco is not and never has been a member of the SPL, is not and never has been bound by its Rules, and is accordingly not liable to have any sanction imposed on it for any alleged breach of the Rules. It does however, for reasons which we shall explain, have a direct interest in these proceedings. What we propose to do is to give our reasons for holding that Oldco, as a former member of the SPL, remains subject to the jurisdiction of the SPL and of this Commission in respect of the Issues contained in the Notice of Commission, and is accordingly liable to have sanctions imposed upon it for these alleged breaches of the Rules, committed while it was a member of the SPL, should such breaches be established. We shall also consider the position of a Club in terms of the Articles and Rules of the SPL and explain why in our opinion Rangers FC remains liable to the imposition of sanctions for breaches of the Rules committed while it was owned and operated by Oldco, even though it is now owned and operated by Newco. It is for this reason that Newco has, in our opinion, a direct interest in these proceedings.
I turn aside to the statement by the administrators on 10th September, where it was said:-
“The SPL have been in contact with RFC 2012 PLC with regard to the SPL’s Commission which is examining Rangers’ historic use of EBTs. However, having taken legal advice, it is the Joint Administrators’ opinion that the SPL is not able to pursue RFC 2012 PLC in this matter.”
Oddly, until the letters sent by Mr McLaughlin on 10th September, Oldco was set to attend the hearing. There must have been a late change in the legal advice, it appears. I am sure it would be wrong to suggest that the administrators were meekly going along with exactly what Mr Green told them to do.
The Commission go on to quote some of the provisions of the SPL Articles and the SPL Rules as follows:-
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”.
Articles 5 and 6 provide:
“5. The authorised Share Capital of the Company at the date of adoption of these Articles is £16 divided into 16 Shares of £1 each.
6. A Share may only be issued, allotted, transferred to or held by a person who is the owner and operator of a Club and if a Member shall cease to be the owner and operator of a Club then such Member shall cease to be entitled to hold a Share.”
Articles 11, 12 and 13, so far as relevant, provide:
“11. Except where the transfer of a Share is occasioned by the promotion of an association football club from and relegation of a Club to the [Scottish Football League], the approval of the Members in General Meeting shall be required before the transfer of any Share shall be registered and the Members may, in their absolute discretion, refuse to approve the registration of the transfer of any such Share.
12. The Members shall not approve the registration of the transfer of a Share for the purposes of Article 11 unless the Board shall first have confirmed that the Board has approved the instrument of transfer and that there exists [sic] no circumstances in which the Members shall refuse to approve the registration of the transfer of the Share in terms of Article 13.
13. The Members shall refuse to approve the registration of the transfer of a
Share:-
(i) to a person who the Board is not satisfied is or, at the time that the transferee will be entered in the Company’s Register of Members as the holder of the Share, will be the owner and operator of a Club; …”
Finally, Article 97 provides:
“97. Each Member shall be responsible for the discharge of the obligations and duties and shall be entitled to the benefits and rights accruing under and in terms of the Rules of and to the Club which it owns and operates.”
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
…
Company means The Scottish Premier League Limited
…
Contract of Service means a contract of service for a Player in the standard form of the League and/or SFL and references to any particular type of Contract of Service shall be construed accordingly
…
League or Scottish Premier League means the combination of association football clubs comprising the Clubs known as The Scottish Premier League
…
Player means a player who is or has been a Professional Player or Amateur Player of a Club
…
Registration means the registration of a Player with the League to a specified Club in accordance with Section D of the Rules and the words Register and Registered shall be construed accordingly”.
It should be noted that this definition of “Club” is wider than that in the Articles, as it includes its owner and operator.
Rule A2.1 provides:
“A2.1 The League shall consist of 12 leading association football clubs in Scotland. The association football clubs eligible to participate in the League in any Season shall, subject to the Articles of Association and Rules, be those Clubs which participated in the League in the immediately preceding Season, except that, subject to Rules A2.2, A2.3 and A2.4, the Club finishing in last place in the League in the immediately preceding Season shall not be eligible to participate in the League and shall be relegated to the SFL and the Candidate Club shall be promoted from the SFL and admitted entry to the League.”
Rule A4 provides:
“A4 The owner and operator of a Club participating in the League shall become a member of the Company by acquiring one Ordinary Share therein at par for cash, such Ordinary Share to be acquired, through the Secretary, in accordance with the provisions of the Articles of Association. The owner and operator of a Club ceasing to be entitled to play in the League shall cease to be a member of the Company and shall relinquish its Ordinary Share at the end of the relevant Season in accordance with the Articles of Association.”
Rule A7.1.1 provides:
“A7.1.1 Membership of the League shall constitute an agreement between the Company and each Club, and between each of the Clubs, to be bound by and to comply with:
(a) these Rules and the Articles of Association;
(b) the SFA Articles and the statutes and regulations of UEFA and FIFA.”
Rule A7.2 provides:
“A7.2 Such agreement shall have effect from the date of the Club’s admission to the League and terminate upon the Club ceasing to be a member thereof (but without prejudice to any rights or claims which may have arisen or arise in respect of circumstances prior to such date and to any Rules which, by their terms, establish rights and obligations applicable after such date).”
Para 43 stated:-
Oldco argues that all contractual rights and obligations between the SPL and Oldco were terminated by the SPL on 3 August 2012, i.e. the date when its share in the SPL was transferred to The Dundee Football Club Limited. The answer to this appears to us to be straightforward. Although a contract has been terminated, obligations arising from it may continue to be enforceable after termination: see Lloyds Bank Plc v Bamberger 1993 SC 570, Lord Justice-Clerk Ross at p 573. Rule A7.2, quoted above, expressly provides that termination of a Club’s membership shall be “without prejudice to any rights or claims which might have arisen or arise in respect of circumstances prior to such date.” The definition of “Club” in Rule I1, also quoted above, includes the owner and operator of a Club. The initiation by the SPL of disciplinary proceedings against a former member of the SPL appears to us to constitute enforcement of rights or claims which may have arisen or arise in respect of circumstances prior to the date when it ceased to be a member, given that the alleged breach or breaches of the Rules were committed during the period of membership.
So, the allegation that the SPL Rules were broken whilst Rangers were members of the SPL means that, even when no longer members, the SPL still has jurisdiction over them. That had seemed a very straightforward position, but the strident arguments to the contrary sought to drown that out.
Para 44 makes that clear:-
To take the hypothetical example of a Club which has been engaged in match-fixing in the last game of the season, but is then relegated and consequently ceases to be a member of the SPL, there is every reason why it should still be liable to disciplinary action at the instance of the SPL – whether or not the breach comes to light before or after that Club has relinquished its SPL membership. We can think of many similar hypothetical examples. Oldco appears to us to be in no different a position.
Rangers FC
It was argued also that, with Oldco having disposed of the assets which made it a football club, the SPL could have no further jurisdiction over it.
Para 46 states:-
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.
This suggests an answer to the Rangers – alive or dead – conundrum. The Club can pass from owner to owner, although it cannot do anything legally itself, not being a legal entity. Here the club has passed from oldco to newco. Whilst the SPL do not have any jurisdiction over newco, they still have jurisdiction over the club. In this way, newco has an interest in the case, even if not a direct one.
Insolvency Act Moratorium
Are the SPL proceedings a “legal process (including legal proceedings, execution, distress and diligence)”? If so, then they cannot proceed as regards oldco without consent of the administrator or the court.
The Commission’s analysis runs from para 49 as follows:-
Paragraph 43(6) (of the Insolvency Act 1986) and its predecessor provisions have been interpreted and applied in a number of court decisions to which we were referred by Mr McKenzie, and which we list here: Air Ecosse Limited v Civil Aviation Authority 1987 SC 285, Re Olympia & York Canary Wharf Limited [1993] BCC 154, Bristol Airport Plc v Powdrill [1990] 1 Ch 744 and In Re Frankice (Golders Green) Limited (in administration) [2010] EWHC 1229 (Ch), [2010] Bus LR 1608. The first of these, a decision of the Second Division of the Inner House of the Court of Session, is binding on us, while the others, which are decisions of the English courts, may be persuasive or, in the case a decision of the Court of Appeal, highly persuasive.
[50] We find it convenient to start with a reference to a passage in the Canary Wharf case, in which Millett J at pages 157-158 considered the legislative purpose for which the statutory provisions then in force (which do not materially differ from those now in force) where enacted. He said:
“They are intended to impose a moratorium upon the creditors of the company in order to assist the administrator in his attempts to achieve the statutory purpose for which he was appointed. They are couched in procedural terms and are designed to prevent creditors from depriving the administrator of the possession of property which may be required by him for the purpose of the administration. … Their construction should be approached with that legislative purpose in mind. They are not intended to interfere with the rights of creditors further than is required to enable the administrators to carry out their functions, and in particular they are not intended to interfere with the creditors’ contractual rights to crystallise their rights or discharge their own contractual liabilities.”
In the course of the same judgment Millett J also considered the meaning of the word “process”, which was defined in Stroud’s Judicial Dictionary (5th Ed, 1986) as “the doing of something in a proceeding in a civil or criminal court, and that which may be done without the aid of a court is not a ‘process’.”
[51] In the Air Ecosse case the Second Division considered the meaning of the word “proceedings”. An application had been made by another airline company to the Civil Aviation Authority (“CAA”) for revocation of the air transport licences of Air Ecosse Limited, which was then in administration. It was held, affirming the judgment of the Lord Ordinary, Lord Jauncey, that the word “proceedings” referred to proceedings by creditors or in relation to actual assets or property of the company and that the hearing before the CAA did not amount to “proceedings” in terms of the statute: see in particular Lord Justice-Clerk Ross at p 295. We have examined the other two English cases to which we were referred, and have found nothing in them that appears to us, on a proper analysis, to be incompatible with this approach which is, as we have said, in any event binding upon us.
[52] Applying that approach to the present proceedings, we have concluded that they do not constitute a “legal process” within the meaning of paragraph 43(6), and accordingly that there is no statutory prohibition on their being continued without the consent of the joint administrators or the permission of the court. There are three main reasons why we reach this conclusion. First, these disciplinary proceedings arise from the operation of the Articles and Rules by which the SPL and Oldco were – and, for the reasons we have given, still are – contractually bound. Secondly, by initiating these proceedings under the Rules, the SPL is not acting as a creditor of Oldco and the proceedings are not at any stage capable of depriving the joint administrators of the possession of property which may be required by them for the purpose of the administration of Oldco. Thirdly, these proceedings do not in any event constitute a legal process because they can be conducted from beginning to end without the aid of a court.
We accept that, in our final determination, should a breach or breaches of the Rules be established, we have the power to impose a financial sanction, which might constitute the SPL a creditor of Oldco. But this Commission has no power to enforce its determination on any sanction, nor to deprive a company in administration of the property available to the administrators The SPL might require the assistance of the court to enforce a sanction determined by a Commission and, depending on the form of any such sanction, at that stage a question might arise as to whether there was a “legal process” within the meaning of the statute. We are satisfied that in exercising our powers under Rule G1.2 firstly in making any determination as to breach of the rules and secondly (if it arises) in imposing any sanction this Commission is not engaged in any “legal process”.
So, as this is not a court case, then it is not a “process” and as such the moratorium does not apply. As the Commission says, the enforcement of any financial order made against oldco may well constitute proceedings against which the moratorium would operate, but it is not a bar to these proceedings.
Personal Bar
Para 53 reads:-
The list of preliminary issues (also) seeks to advance arguments to the effect that the SPL is, by its conduct, barred from seeking the imposition of sanctions, or at least of a particular sanction, in the event of a breach or breaches of the Rules being established. We do not propose to deal with these arguments at this stage, as they appear to us to be premature. They would only arise if we had already held that a breach or breaches of the Rules had been established, and there is therefore nothing in them which could affect our consideration of the merits of the Issues set out in the Notice of Commission. Moreover, a plea of bar is for the party advancing it to substantiate, and in the absence of evidence in any form from Oldco or Newco to substantiate these arguments we have no basis upon which would could uphold them at this stage.
This seems to relate to Mr Green’s assertions about a pre-determined punishment. As the Commission says, arguing about the sentence before there is a verdict is premature. In any event there requires to be evidence and someone there to argue it. In the absence of representation, it is very hard to see how the Commission can be faulted for ignoring the matter, as it would not have been attempted to be made out, nor would a judicial appeal be looked on favourably on that ground where there has been a wilful decision to ignore the process.
The Commission concluded by giving directions as follows:-
“Further to the decision made today we make the following procedural orders:
- 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.
- 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.
- 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.
- We direct that intimation of the aforesaid decision and of these directions be made to the solicitors for Oldco and Newco.
And the final words make the position of the Commission clear:-
We wish to emphasise that, as is plain from our decision and directions of 12 September, the door remains open for Oldco and Newco to appear and be represented at the hearing in November. We would invite each of them to reconsider, in light of what we have written above, the decision they took on 10 September not to participate in the proceedings.
Will Oldco or Newco respond to the invitation? Who knows!
Posted by Paul McConville
Random Thoughts Re Scots Law by Paul McConville 
i don’t think your EBT dates are correct 😉
Typo in first section. You say SPL has jurisdiction over newco. You mean oldco.
The big thing for me is that the commission reckon the current Rangers club is the same as the old Ranges club. I’m surprised about that and wonder how HMRC will view this. Who owes them tax – rangers the club or oldco?
I’m also interested how the SFA will play this. They are identified as the appeal body should he SPL find rangers guilty. What about fielding illegally registered players in Scottish cup matches? If the SFA pursue this, who will be the appellant body?
Obviously the commisssion are wrong and haven’t kept up to date with events on this site and on PMacG’s where the definitive version of events can be found.
There hasnt been a legal definitive yet, but the above is very interesting.
Daddy.
Yes?
What are EBTs?
Well they’re … er … “Payments made by or for [Oldco] into an employee benefit trust or trusts for the benefit of Players, including the Specified Players, employed by [Oldco] as Professional Players, Registered and/or to be Registered as Professional Players with the Scottish Premier League and Playing and/or to Play for Rangers FC in the Scottish Premier League and payments made by or for [Oldco] into a sub-trust or sub-trusts of such trust or trusts of which such Players were beneficiaries, payments by such trust or trusts and/or sub-trust or sub-trusts to such Players and/or for the benefit of such Players and any and all arrangements, agreements and/or undertakings and the like or similar relating to or concerning any of such Players and payments.”
Oh. … Can I have one?
No.
Mr Green is strarting from the position that if you instigate charges against anyone that you are immediately biased.
He is not wrong, nor right. We have had a long history of sophistry and outright bias leading to the current complex and wordy legal process.
Rangers were a major football team in Scotland. They went burst (not a legal term), not because of Popery or any other plot just stupiidiity.
Mr Green and his backers bought Rangers.
Where does the ownership start and end ?
.
It seems like Rangers fund their solicitor’s from the same no-win-big-fee website as D&D
“This is not to say that a Club has legal personality, separate from and additional to the legal personality of its owner and operator.”
I thought that when the club incorporated in 1899 it became a legal entity.
I thought incorporation personifies the club in law.
Why is the club no longer viewed as a legal entity?
Has a new legal definition of an incorporated football club just been invented that makes them impervious to liquidation?
I’m confused.
Sorry, but the second part of the paragraph is important and I missed it out.
“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 the incorporated club founded in 1899 has no legal personality.
I can’t get my head around this.
I think what this is is a legal way of saying what most people recognised and has been debated on this site and others and that in the parallel football universe the club exists independent of companies. Therefore Rangers can survive as a “club”, but not a company. The downside for green is that the club can be penalised and newco has to pay.
So Rangers are not dead according to our learned friends, as the club is separate from the legal personality of its owners, which is what some posters have been arguing for months. Open the freezer Desmond, the ice cream needs to go back in, as the party is indefinitely delayed.
If I am interpreting this statement correctly – the club exists under the umbrella ‘legally’ of whomever owns it. It has no separate legal personality – it requires the symbiotic relationship with its owner in order to conduct it’s affairs legally. Its not an admission of whether the club is alive or dead but simply that it cannot be treated as a legal entity. Legal Proceedings cannot be taken against the club, any ramifactions from the clubs actions under the rules can only be answered legally by the owner. So depends on whether you believe that transference of the club from one legal entity to another as part of a sale of assest under an insolvency event where no CVA has been approved proves or disproves the continuance of the club.
I could be wrong though as I have now read this twice
Who’s on First ? – Abbot & Costello anyone ? – it was easier to follow 🙂
Paul McGinty, the report does say:
“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 ”
This to me is saying that the current rangers is the same as the old rangers as far as the commission is concerned. I am still interested in who owes the tax on the EBTs. Is it Rangers the club or oldco? I think it is the former.
That’s easy. It’s oldco as they are the legal entity employing the players and responsible for tax payments.
I don’t think it as easy as you suggest. The contracts were between the club and the players. All the commission is saying is that the club cannot enter contracts on their own.
“……….Club, it would at the least comprise its name, the contracts with its players, its manager and other staff”
Whilst I have no direct proof my understanding is that the players contacts were with oldco, which is why some players walked under TUPE as they were being transferred to newco. If the club had the contact then the club would need to a legal entity, which it isn’tand also no transfer would have taken place. Given that the SPFA lawyers gave it the thumbs up then I would suggest that the contracts, tax etc all rested with oldco.
The company only exists to operate and form contracts and be held responsible for the the legal processes as required by the club therefore if the club is not liquidated and still exists .. then they are surely responsible for the club no matter which company they use to conduct their affairs.
Otherwise the whole process is flawed and it is a case of having your cake and eating it.
@RayCharles. What Para 46 of the Opinion is saying is that the Club never had a seperate legal personality. It could not on its own enter into a legal contract. It is the Company (which owned the Club) which became a legal entity upon incorporation in 1899.
But the club was, at that time, the company which it was incorporated into out of private ownership, and into a private limited company.
When the company ceases to exist, either by virtue of liquidation, or by virtue of disincorporation, then surely the club, as it is the company at that point in time, cease to exist too?
A company cannot be an asset of itself, that defies logic, and the law.
The Craic
If the CocaCola Company ceased to exist, the CocaCola brand would continue to exist, would be bought by another company, and would retain its goodwill, heritage, and loyalty of its customers. Just like Rangers, but without the bitter after-taste.
Let us say that, for example, that I decided to set up a Cola company, let’s call it Craics Cola, using the assets of the now defunct Coca Cola company.
No matter how many people bought the product of Craics Cola, and no matter how it was marketed, Craics Cola company will never be the original Coca Cola company, and nothing can change that.
If I wanted to claim that I was the Coca Cola company, I would have bought sufficient shares in the Coca Cola company prior to it being liquidated to hold a controlling majority.
At no point in time would I be able to claim to be the original Coca Cola company.
True. But that is not the point. The point is not that you claim to be the original CocaCola company, but that you claim to be the original CocaCola brand. Which you are.
If your new coca cola company had an old van and went around the schemes selling coca cola is it the same as the old coca cola company ?
All the same prestige and heritage etc ?
MG’s are now built in China. Do they have the same prestige and branding as the old MG Sports models ?
If it is the same recipe, and the customers believe that it is the same CocaCola, then yes.
If the customers of MG believe that it is the same MG, with its heritage and tradition and its propensity to break down, then yes.
I think Green’s pronouncements point towards an intention by the Club to just ignore any removal of titles rather than actually challenge the issue in Court. I can see an outcome where RFC continues to assert it holds /won the titles even though the SPL commission has decided otherwise.
I think it is wrong for the Club not to be represented at the commission, and think that would restrict or perhaps remove the Club’s rights to take the matter to the Courts.
The club just ignoring the removal of titles is not, for me, an at all satisfactory outcome. If it is indeed Green’s intention to proceed this way then whilst in the short term it might be seen by some supporters as defiance and so supported, for most I think it will mean the honeymoon with Green is over.
As others have noted above, the ruling does provide support for the argument that the club is not the same as the company, and is instead something akin to “the business” run by the company – which may be transferred between corporate entities.
To be fair, the ruling is dealing with how the SPL rules deal with the concept of club and company rather than deciding the issue in general. That said, the position seems to be along the lines adopted in the various English administrations and liquidations which have been mentioned in earlier posts.
In passing it’s interesting that the SPL commission refers to the club becoming a member of the SFA rather than having the old membership transferred. That is different to what was said at the time of the agreement ahead of the Brechin game, and to the follow up press release made by the SFA in early August, both of which confirmed the transfer of the old membership. The reason why transfer rather than new membership was seen as important though was that it might support the continuing club hypothesis. Given Lord Nimmo-Smith’s decision appears to support this hypothesis anyway, it may not be so important. I would still tend to believe it was a transfer given that is what the SFA themselves say, though.
Green’s pronouncements about silence from the SPL or their lawyers seemed to me to be specifically related to the issue of the SPL’s jurisdiction in respect of the current company (her refers to the club, but its difficult to know whether he is referring to the same concept as the commission when he uses this word) rather than generally, so I think he may have chosen his words to appear to be saying more than he was.
a but details of titles belong to the body that owes then…
e.g. Newco cannot list any details of SPL matches oldco won… as SPL own that information.
So best case newco say 54 titles – but there are 5+ they cannot detail!!!!!
@ Duplesis
I think one of the fascinating things that comes out of this the more I look at it is the continuing club concept.
Does this allow HMRC to act against newco for tax liabilities of oldco – I’m not actually saying that it could happen under current legislation but I can see a situation where Hector speaks to Osborne and points to the use of phoenix company loophole so easily employed in a football scenario and has the necessary enabling regulation made which might not even require primary legislation.
After all if the Commission legal ruling on the continuing club isn’t successfully legally challenged and is then subsequently adopted by the industry Regulator in the shape of the SFA I think it raised interesting issues.
Of course I think it puts Green in a bind as he can’t really challenge the Commission’s continuing club concept – or can he?
ecojon
Try swapping the term ‘club’ for the term ‘brand’, and things become much clearer in respect of the continuing concept. Then compare it with a well known brand such as CocaCola, or Nike, or Persil. Any awards these brands have won remain part of their history, and it is irrelevant which corporate body actually owns the brand.
Not sure I understand the ‘Brand’ reference as I dont really see Rangers FC as a ‘brand’ The recipe for Coke Cola is an intangible asset of the operating company and the Value of this could be classed as IP. I would have thought Rangers FC if comparable IP, would have been listed as an intangible asset since it is capable of attracting 50K supporters on a regular basis and capable of generating £30M annually. I would therefore have thought that Goodwill listed by the administrators would have been valued in excess of £1. Where they unaware of this intangible asset of the ‘club’?
The goodwill would have been set at £1 for tax reasons, nothing to do with its actual value.
Rangers does have IP – the whole bigoted, nae surrender, simply the best, we are ra peeepul, nonsense. I might not like it, but it drags thousands every week towards spending on the brand.
Rangers is a brand, not as large as CocaCola certainly, but still one all the same.
If it was as straightforward as you suggest, the club as a brand would have been set out as a business asset included in the asset purchase agreement from Rangers Football Club PLC to Sevco Scotland Ltd – an item would have been listed as ‘The brand that is the club’ or something like it. A brand is a well recognised concept. A club is not its brand.
It was. It is included in goodwill, as is the case on the balance sheets of thousands of other companies.
Marching on Together on September 22, 2012 at 5:13 am So Rangers are not dead according to our learned friends, as the club is separate from the legal personality of its owners”
MOT: So if you accept the.premise that what this independent commission decides is correct and binding, for example Rangers “are not dead” (in the eyes of SFA/SPL – we still have BDO to hear from) then newco will be liable for any punishment that the commission decides to levy against it for the rule breaches alleged to have taken place for a decade and more. Right? You, and Charlie Green, can’t keep playing the newco/oldco shell game in order to dodge responsibility.
Personally I am much happier to see Rangers, the club, paying the price for their breaking the rules rather than dodging punishment.by changing the brass plate above the door.
>>> Independent commission: you’re up!
@jockybhoy
Yea a tricky one that for Rangers supporters – to avail themself of the Past/Present/Future concept they have to accept what everyone else has been saying all along and that is you can’t do a pic ‘n’ mix. You either take it all or nothing – good and bad.
I’m not sure that Marching on Together has got it quite right with his statement: ‘So Rangers are not dead according to our learned friends, as the club is separate from the legal personality of its owners.”
I think it more correct to say that the club has no separate legal personality of its own which means that any sanctions would need to be borne by oldo or newco in an almost joint and several liability scenario.
Perhaps this is why CW had the ultimate ownership vested offshore and, who knows, perhaps it still is 🙂
ecojon
I accept your more accurate rendition of what the Commission actually decided. My only defence was that it was 5.13 in the morning, and I was try to post something quickly to convey my sense of gloating at having been proven right on this all along, before rushing out the door.
As for the sanctions being borne by oldco and/or newco, it is only oldco which will bear them, as it was the owner of the Rangers brand at the time, if it is financial (so that the SPL can be added to the list of unsecured creditors and receive a fraction of a penny in the pound in payment), but as part of what was sold to newco was the titles, tradition and history, then newco will be affected when they are stripped, and theoretically newco might have a claim against oldco for this loss (unless this is ruled out by the asset sale agreement between D&P and newco).
Having said all that, I am sure that as a condition of SFA membership, newco had to accept responsibility contractually for sanctions on oldco.
@ecojon. I thought that we had converged on the concept that the club is simply a brand operated by the legal entity? Certainly you gave me the impression of this when you commented on a post of mine last week.
jockybhoy
“newco will be liable for any punishment that the commission decides to levy against it” If newco have agreed contractually that they will accept the sanctions as a condition of the SFA granting them membership, then yes. If not, then no, with the exception of the titles being stripped – oldco cannot sell to newco something which does not exist, and that I think will be the status of some league titles after the Commission has completed its work.
“You, and Charlie Green, can’t keep playing the newco/oldco shell game in order to dodge responsibility.” You seem to have confused me with a bigoted moron.
According to the guidelines the “club” is not a legal entity. If so can “the club”actually be “owned” by anybody. Can some legal mind please clarify?
So the SPL and the SFA sit down with Chico, tell him that if he signs up for a wee deal admitting that the mighty Gers shot Kennedy,caused world hunger,and are the baddest bad people in the badlands then they can get to play on the roulette table at Regan and Doncasters casino,where the ball stops just where its told!
Just play ball Chico there’s a guy out east that wants your head so sign this and we can move on.
Chico tells them to shove their deal and in a strop the two stooges set up an independent commision to come to the conclusion that they had already reached??
Who do they hire to do their bidding?,,,,why Celtics lawyers of course,praised by Coyote Pete,led by rotund Rod who seemingly has a bee in his bunnet regards the case.
All of the above couldn’t really be true,its just nonsense of course,the ramblings of a delutional(thanks Mick) mind.
“Darling could you bring me up todays paper?”
WTF! your shi**ing me! paperwork of a deal like that actually exists???
What type of newspaper could print rubbish like that?
Oh its the Sun,that damned rag that was gonna serialise that pamphlet cobbled together by a guy tarred with a sectarian brush.
Woof! that explains it,its all nonsense.
“Darling could you cancel this paper and bring me a brandy”
@Cam, kinda thought you would come out with a better and more reasoned and informed point of view then your 2 posts so far. I don t think its very funny that RFC are in everyone in authorities current opinion having a case to answer for apparent wrong doings and no matter oldco or newco, NEITHER are concerns enough to have representation at the hearing or supply any relevant defense of these claims.
If this was my club, then I can assure you that we would be picketing the board memebers insisiting that they have the responsibility to represent the fans WHO ULTIMATELY own the “CLUB”. CG is quick enough to bang the drum when he wants the masses to pay money into his operating companies coffers…………….lets see how far he gets when they are baying for his blood because they have been suspended from playing in the Scottish Leagues, make no mistake the reversal of match results where ineligible players were fielded is only the start of sanctions available and the way he is going on currently the few freinds he had in SFA HQ will be able to do nothing to assist and basically patience and time has run out for him.
My serious worry and concern is that as has been written in many posts on here CG is only in it for the short game, just look at his business CV, I truly believe now that instaed of saving RFC he will be the one who finally sticks the dagger in.
Look at what the commission are saying in their close…….it is almost an appeal for oldco / newco to represent RFC at the hearings as to not do so will leave the most importantly the fans of RFC effectively no defense. Not something I would ever have thought possible from the Govan part of Glasgow, No Surrender – No walking away – NO DEFENSE???
apologies for the typos but bit of a vodka head this morning, specially after reading through all the above………………..
Michael a man of your vintage should leave the vodka alone,far better to stick to the grape which i find far more conducive to internet bampottery.
My first point is actually one of my best as it acknowledges the superior intellect and grasp of the situation held in these forums.Nimmo and his fellow wiggies fail to understand the fitba arena is outside of the legal realm and its my understanding that he has a blot on his scorecard regards dispensing justice to the mighty Gers ,one which another wiggie had to overturn and which the SFA ignored.
It has been suggested by that doyen of chip wrappers the Sun that HMRC contacted the SPL 2 years ago regards EBT’s,that Neily and the bhoys have already concluded Gers guilt and fixed a punishment deemed suitable by all very interested parties.Lets see an integrity omelette made out of that pile of rotten eggs.
As to Chico giving this trial by newspapers all the contempt it deserves then i back him fully,even all the way to the stooges handing down their ultimate sanction of withdrawing the Gers licence to play.
Doncaster and Regan are IMHO the biggest disaster to hit Scottish football since Craig Paterson and the spotlight will soon be shining on them.
My own thoughts are that once the wiggies shuffle some papers for a day or so and let Roddy bhoy wax on, the guilty verdict will be rubber stamped and Neily will try the financial road as the SPL are a wee bit short at present.If his advisors tell him its the titles we want then he can get out as much tippex as he likes, but Scott McDonald still scored those Motherwell goals and i still celebrated with my mates in a helicopter a week later.
cam
You are mixing up your Lords. Lord Nimmo Smith has not had any decison about RFC overturned by the “wiggies” as you put it.
Did you read the opinion of Lord Nimmo Smith’s Commission?
Did you note that RFC refused to turn up and withdrew the bias accusation?
Did you see that the personal bar case was deemed premature, but that no evidence of it was submitted anyway?
Or is it your position that Lord Nimmo Smith and the 2 QCs are all part of a conspiracy?
Sincere apologies to Nimmo,it was Carloway.
The 3 gents in question will ponder over the evidence presented by Rod and deliver their verdict,if their is any agenda then i don’t believe for a moment that these 3 guys would lower themselves to be a part of it.
Rangers and the fans will take their lumps and get on with it.
I don’t sift through the minutiae of law, its boring and its my understanding that an accused patently guilty of something can be freed due to admin errors which combined with my only experience as a juror left me feeling that the law is indeed an ass.
Paul
Sadly Cam suffers from what I described once before as ‘inherited ignorance’ which no amount of education can eradicate.
@Cam
specifically regarding the disclosure from the HMRC to SPL re EBT’s you are forgetting in your narrative that SFA/SPL were very much buddy buddy at that time with the lamb and red wine providers at Ibrox, SFA being run by good old bluenoses who actually were receipiants of the EBT’s themselves, there are still one or two lurking so when or if this goes to appeal to the SFA where do they stand on conflicts of interest?
Just because current situation has had TRFC faithful rebel against them, ( I still don’t understand why as they have all bent over backwards to accomodate TRFC, its the clubs and Scottish fans who have enforced the rules through the authorities and even then not completely with regards to the articles). This does not discount that they were hardly likely to ask very difficult questions when they themselves were potentially involved in this situation.
The fact is that within the accounts presented to SPL/SFA the disclosure of EBT payments to the playing staff had been “masked” as the beneficiaries and were not detailed was deliberately misleading.
Therefore while I agree that SPL/SFA ( both authorities equally share the blame for ineffectiveness as the both sign off on fit and proper checks respectively for UEFA), should have conducted an indepth investigation at that time, they have not been supplied , as far as we know, sufficient information to make those enquiries.
There was, IMO, deceit from DM, MGH, in the accounting procedure by “grouping together” the payments of playing and non playing staff. Rightly so any non accountant, and even some accountants, would look at the figure and assume that this sum being so large would be directors or shareholder payments.
It is something for the future that more specific and detailed accounts should be required to be filed by ALL clubs and both SFA/SPL/SFL require to do proper strict fit for purpose and due diligence checks, no matter what the cost, in relative terms it is smaller than the chaos and loss of revenue for ALL parties, never mind the embarassment.
We all understand that the articles of association of all 3 authorities require to be rewritten in plain undisputable terms so that nothing like this occurs again.
“Scottish fans who have enforced the rules through the authorities” Mmmm. It seems that there are a lot of fans who now wish to cast aside the rules as clearly set out in the rules of the SFA and SPL in order to cling to a fiction that Rangers are no more.
Michaelk1888
Hmm .. refusing to recognise the court. Where have I come across that tactic before?
It’s called the Lance Armstrong tactic.
Cam,
Nobody had Chicos arm up his back with this deal, but instead he was free to refuse. He was free to allow the SFA membership/registration to pass to another new club and he could take his assets off to auction to the highest bidder.
Which of Chicos two options would you prefer he had chose?
The one every Bear wanted,drop down to the bottom of the pile and start again,no deals,no jiggery pokery.
If the Hampden Cosy Nostril wanted to refuse a licence application by the Gers then that would have been their perogative,,its their bowling club,their greens that we want to use and if they say no then fine we will join another club.
“Cosy Nostril” – hehe :O)
Thats just it, though, it wasnt a straightforward application in the sense that a number of clubs were in the running (in the case of Annan replacing Gretna recently). It was a deal done by a number of parties to their mutual satisfaction at the time. But as I say, nobody had Groan’s arm up his back on this one. He was free to refuse the deal if he saw fit.
“I think Green’s pronouncements point towards an intention by the Club to just ignore any removal of titles rather than actually challenge the issue in Court. I can see an outcome where RFC continues to assert it holds /won the titles even though the SPL commission has decided otherwise.
I think it is wrong for the Club not to be represented at the commission, and think that would restrict or perhaps remove the Club’s rights to take the matter to the Courts.
The club just ignoring the removal of titles is not, for me, an at all satisfactory outcome. If it is indeed Green’s intention to proceed this way then whilst in the short term it might be seen by some supporters as defiance and so supported, for most I think it will mean the honeymoon with Green is over.”
Indeed – Green’s posturing may be popular in the short-term but, longer term, he will not be forgiven by the fans for failing to actively defend Rangers’ interests at the commission’s hearings.
The revelation that neither Newco nor Oldco will be represented at the hearing is an admission that there is no sensible defence to the charges, as the evidence looks so overwheling as to be irrefutable.
The legal foreplay is now concluded and the charged parties have packed their bags and gone home to hunker down in their bunkers.
They’ll need to be nuclear shelters as the fallout from Nimmo is likely to be severe.
Even after reading the excellent anaylsis by the legals, i still struggle to get my head around the “common sense” of the legal interpretation of club and company.
When I started reading RTC last year, I heard what the experts called a pre-pack liquidation and I thought this type of thing could not happen. An effective legal tool to shed your business (football club) of millions of pounds, cherry pick your desired assets and then continue life a day after calling yourself the same name, playing out of the same stadium, wear same crest and colours.
Paul, what legal rules are in place to stop this type of thing happening? Please give me some hope that our corporate legal system affords us some protection.
I hope BDO play a blinder in all of this and firstly challenge the deal between the administrators and SevCo 5088. That may be a good start.
Its about time people like SDM, CW and CG pay their dues in what is effectively “pass the parcel”.
@ Paul thanks for taking the time to put this together with understandable narrative, even the terms used by the commission are i suggest meant to be able to be understood and NOT cloaked in legal jargon. They lay out the details clearly for all to follow.
At exactly what point in time did “the club” become a seperate entity from the company that owns and operates it? I’m sure the shareholders of the former Rangers FC PLC would appreciate an answer to that question. Did they ever hold shares in “the club”? To me it appears the answer is no, they didn’t, although I’ll bet you a pound to a penny they thought they did. Do they then have redress against the vendor from whom the shares were purchased, or was it clear from the offset that they bought shares in the operating company and not “the club” itself?
Where does this leave shareholders of other clubs or operating companies or whatever they are? Thousands of people bought shares in Celtic….or so they thought……
This is an important issue. Why was the notion that the club and company could be seperated so easily never mentioned until Bill Miller (remember him?) proffered the idea? Is this concept worldwide, Europe wide, UK wide, Scotland wide or confined to the south of Glasgow?
If “the club” in question, namely Rangers FC is unconnected with the owners/operators and can simply be transferred from one owner/operator to another without interruption to it’s history and achievements, why was it necessary for Sevco Scotland Ltd to change its name to The Rangers Football Club Limited? After all, they already owned and operated the etheral spirit that we are being told is Rangers FC.
Does anyone else think this is just a load of made up pish to appease the thousands of Rangers FC PLC supporters who are (rightly) outraged at the thought of their “club” no longer existing?
The concept of separation of club from the company operating it has existed for some time. Most of the major footballing administrations in England over the last 15 years have worked on this basis – with the club being transferred from the company in administration to a new company, and the old company in administration being left to die.
The position seems to be that a club doesn’t have a legal personality – it is simply the undertaking or business.
Pre incorporation, the club is run by the individuals which operate it. Post incorporation it is run by the legal person those people created when they formed the company – but the club doesn’t become that legal person.
Thanks Duplesis, but “some time” is not exactly “when” and I have no examples of “the club being transferred from the company in administration to a new company, and the old company in administration being left to die”.
Why was there such a hullaballoo pre CVA rejection about preserving history, including comments by Charlie Green himself following Dave Kings’ plea to creditors, when it should have been perfectly clear that there was never any danger to “the club” as they were and are a seperate entity from the owner/operator?
Can anyone honestly tell me they actually thought Rangers FC and Rangers FC PLC were not one and the same thing prior to Bill Millers “incubator” theory?
Thanks Althetim,
I’ve posted a long list of examples previously and didn’t want to hijack thus discussion by doing it again.
The post was in response to A recent blog post by Paul relating to Green’s proposed share issue and what the shareholders would actually be buying into if they subscribed.
The example clubs I gave were Plymouth Argyle, Crystal Palace, Rotherham and Luton. All of these ended up as new companies after administration, with the club transferring between the old and new company.
There are many more examples. Basically it seems that any time – at least in recent years – that an English club has left administration, it has done so being operated by a new company.
Althetim
“I have no examples of “the club being transferred from the company in administration to a new company, and the old company in administration being left to die”.”
My own club, Leeds United, did exactly that, and we are same club as was before the administration and liquidation.
Not 100% accurate as Leeds not involved in Liquidation process – once HMRC withdrew legal challenge – company was sold as a job lot by the 2nd adminstrators appointed
Paul McGinty
Yes, and Rangers won the European Cup in 1967, and Celtic went into receivership before Fergus McCann bought the ground and the trophies.
For the umpteenth time on this site and Phil McG’s, it was not the company, but the club i.e. the assets that were sold. Just like Rangers. Leeds oldco went into liquidation in Feb 2008, after the assets had been sold. Just like Rangers oldco are going to do. The asset sale was completed prior to HMRC ‘withdrawing’ their challenge, not after, and it was only a technical withdrawal from court proceedings, as there was no CVA left for them to challenge. There were no second administrators in this administration, it was KPMG in Leeds throughout.
Your post was not even 1% accurate, never mind 100%.
As Marching on has pointed out, this isn’t quite true. The 2nd administration sale happened whilst the CVA was still under challenge by HMRC. That challenge was withdrawn subsequent to the transfer of the assets.
The company wasn’t sold as a job lot in the administration sale. The assets of the company – including on this analysis, the club – were sold from the old company to a new one.
Leeds were involved in a liquidation process – the old company was liquidated after the asset sale to the new one.
The Leeds company was The Leeds United Association Football Club Ltd, formed in 1920 with company number 00170600.
The current Leeds Utd company is different, it is Leeds United Football Club Ltd, formed in 2007 with company number 06233875.
The 2007 company bought the assets from the 1920 company whilst the 1920 company was in administration. The 1920 Leeds company then went into liquidation in 2008.
On 3rd July 2007 HMRC lodged a challenge to the CVA of Leeds United Association Football Club Ltd. The HMRC’s grounds for appeal were “based on procedural matters relating to the way which KPMG conducted the creditors’ vote”. The legal challenge would have stretched into the 2007/2008 football season and Leeds may not have been able to start the season. This led to the administrators, KPMG aborting the accepted CVA and selling Leeds United Association Football Club Ltd to Bates’ new company Leeds United Football Club Ltd.
Read more: Football Club Administration | Free Company Law Essay | Law Teacher http://www.lawteacher.net/company-law/essays/football-club-administration.php#ixzz27K0FKiKy
Yeah got that slightly wrong – , should have said 2 sales arranged not 2 administrators, but since the adminstrators sold the entire business in the best interest of the creditors slightly higher than 1%
Anyone interested should really read the ‘whole’ article it is quite informative although I did have to look up
Leeds United PLC went into compulsory liquidation on 6 March 2006. This is the company that was founded in 1919. Prior to going into liquidation they sold off the club trademark, history, playing staff and registration to play in the English leagues to a New Co Leeds United 2007 Limited.
The compulsory liquidation having been necessary once the entire assets had been stripped to the 2007 company – i.e. they did it to themselves.
Leeds United Association Football Club Ltd did not exit administration via a CVA, as the previous forty-one league clubs that experienced financial difficulties did. It was thought that LUFC were in danger of not being granted their ‘football share’ by the FL and not being able to start the football season. However, the FL eventually accepted the sale of Leeds United Association Football Club Ltd to Leeds United Football Club Ltd without a CVA under the ‘exceptional circumstance’ exception. This was done reluctantly and the FL stated that they could not allow the company to work outside their strict rules concerning administration and imposed a fifteen point penalty for the start of the next football season. LUFC appealed against this decision. Their initial appeal was dismissed by the chairman of the FL clubs. However, this appeal is ongoing and LUFC have recently accepted an offer made by the FL. Their appeal will be heard by a three man arbitration in private.
Read more: Football Club Administration | Free Company Law Essay | Law Teacher http://www.lawteacher.net/company-law/essays/football-club-administration.php#ixzz27K1Ww8XW
I interpret the above as follows – if Leeds Utd in whatever form had indeed been liquidated then it’s Football League Share would have been removed – Hence at least in the eyes of the FL liquidation never took place. As Leeds played in the FL the next season.
Feel free to comment constructively
1) “KPMG aborting the accepted CVA and selling Leeds United Association Football Club Ltd to Bates’ new company Leeds United Football Club Ltd” I see what you did there – you C& P’ed bits from the source you cite, but changed a crucial bit. Leeds United Association Football Club Ltd was never sold, but as the source you cite says “the administrators announced that they had sol the club to Newco” i.e. it was an asset sale, the sale of the business, and NOT the sale of the company.
2) “the FL eventually accepted the sale of Leeds United Association Football Club Ltd to Leeds United Football Club Ltd without a CVA” That statement in the source you quote is simply not true, and is contradicted by statements elsewhere in the article. The assets of Leeds United Association Football Club Ltd were sold to Leeds United Football Club Ltd, not the company or its shares. The article goes on to say: “The majority of the limited companies that hold the football clubs end up selling their assets, including the football club, to a newly formed company. This was certainly the case with the four football clubs that are companies studied in this dissertation.” Which is what I have been saying for months.
3) “Leeds United PLC went into compulsory liquidation on 6 March 2006. This is the company that was founded in 1919.” No, Leeds United Plc was incorporated on 17 Oct 1989 http://wck2.companieshouse.gov.uk/035a48010fb656ca95589dd6f35e2a21/compdetails The company which was the original Leeds company was The Leeds United Association Football Club Limited (Company number 00170600) incorporated on 2 Oct 1920. It was the one which went into administration in May 2007, and whose assets were sold to Newco, and which went into liquidation on 15 Feb 2008 http://wck2.companieshouse.gov.uk/035a48010fb656ca95589dd6f35e2a21/compdetails Leeds United plc, in previous ownership, had been the holding company of The Leeds United Association Football Club Limited.
4) “if Leeds Utd in whatever form had indeed been liquidated then it’s Football League Share would have been removed – Hence at least in the eyes of the FL liquidation never took place” True if that had happened when the liquidated company owned the club and the Football League share, but the liquidation happened after the sale of the assets to Newco – which is exactly the same as with Rangers.
@Duplesis
In reality a club has to find a way of creating a distinct and separate legal personality otherwise it could never operate beyond a tiny grass-roots level as all of its members in association are jointly and several liable for the debts and liabilities of the club.
That’s why football clubs and those of other sports start up with a core of usually playing members and as they grow and start to organise leagues they had to start incorporating themselves to financially protect the members.
It was a natural progression but personally I think it’s a good thing to think that there is the possibility of a beating heart existing sepaerately from the rip-off merchants who just want to liquidate assets and bugger-off. The club and the power which comes from mobilising its support is the only actual defence which fans actually have at the end of the day.
And it’s interesting in a sense in that buying season Tickets the way they did at Rangers that they actually lose that power for at least a season. It might have been better for the ‘club’ in the longer term just to buy tickets on a per game basis but that is something that only time will tell.
Exactly. It has puzzled me why those who insist that Rangers are dead are unwilling to have Rangers treated in the same way as any other football club which has been in this situation.
Like Gretna, Airdrieonians, and Third Lanark were?
None of those 3 are particularly good examples. There wasn’t an asset and business sale to a new company when Gretna and Third Lanark became insolvent. The clubs simply stopped altogether.
In Airdrie’s case, the new company bought the assets and business of Clydebank, then changed their name and moved to Airdrie.
But if the clubs and company are, as you postulate,seperate entities, then how can it be possible for the clubs to be discontinued merely because the company which ran them went bust?
Surely the club must still be around in some form, somewhere if that is the case?
@ Althetim
Nothing has been made-up it exists under the current rule book although as we have seen previously there can be different interpretations of rules:
The Commission states: ‘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.’
In reality a club does belong in the hearts and minds of its support and even when actually ‘dead’ it is still remembered as a club even though it died 50 years ago. As to shares well they are only a device to faciliate the financing of the operating or even holding company. Unless a majority of the club shareholding is bought by fans then they own nothing in reality. It’s no difference from buying kit or a pie and bovril.
Often with football shares there aren’t even any voting rights and in the proposed Rangers float only 15% of shares are anticipated to be available to supporters. For a whole load of reasons just about every football club that was floated on the various exchanges have now left and Green is virtually alone in bucking the trend and going for a public listing.
Of course Man Utd floated recently in New York on a much reduced issue price which has certainly failed to set the heather on fire and only amounts to 10% of the club. They even had to move the float from Singapore as they didn’t think it would be successful. So much for all these Far Eastern investors that are supposedly clamouring to force cash on football clubs.
Ecojon – that doesn’t answer the question.
“The Commission states: ‘It is the Club, not its owner and operator, which plays in the League.”
Where was this revelation prior to the Commission statement? The Commission, not the rules, have seperated “club” from owner/operator.
It is all conveniently contrived nonsense. They are one and the same.
Unfortunately due to time constraints, I must leave the discussion at this point but thanks to you and Duplesis for your input.
Althetim
It has always been the case that the club and its lergal owners are two separate things, and it has been pointed out on here and on Phil’s site repeatedly that this is the case according to UK football custom and practice, and the rules of the Scottosh football authorities. It is only those who were so deluded as to believe their own fantasies, that are surprised by what the Commission has said on this.
Marching on Together
Tell me then, what was all the fuss about when Rangers FC PLC went into administration last February? It must have been clear to you and the rest of the Ilumni that the “club” was in no danger, it would continue to exist regardless of the fate of it’s operator/owner. It (the club) merely had to find a new one.
This seperate entity nonsense is a recent phenomenon. I know of no reference to Rangers FC PLC “owning and operating” Rangers FC prior to 14th February 2012.
Prove me wrong.
This “the club is dead” nonsense is a recent phenomenon. I know of no reference to football clubs dying if their parent club goes into liquidation prior to 14th February 2012. It is a fiction made up by those of a green tinted variety. It was only when they started suggesting that without a CVA that Rangers would die, that it became necessary for those such as me, who actually understand the potion, to post and rebut the nonsense that was being spouted.
My own club, Leeds United, had exactly the same thing happen to them in 2007-2008, and nobody but nobody suggested that Leeds United were a different club founded in 2007, with all the honours won previously having been ditched.
As for me being an “Ilumni” (sic), if anything. I am Celtic-minded.
ecojon
“In reality a club does belong in the hearts and minds of its support ” I got pilloried on Phil McG’s site for saying exactly that by a lot of ill-informed morons, who let their own prejudices get in the way of seeing what actually is the case.
Look at AFC Wimbledon, recognised by everyone, except some green-tinted Rangers haters, as the successors to the history, tradition, and honours of Wimbledon FC of the Crazy Gang et al. Because the fans decided it was so.
You used the phrase ‘green tinted’ and then claim to be Celtic minded to add weight to your ridiculous claims. You sir are a liar,
You sir are a bigot who would not know the truth if it slapped you over the head with a wet fish,
althetim,
I am secure in the knowledge that M’noble Lord is not in the business of making up pish to appease anyone, including football fans, Rangers FC or otherwise.
@ Carl31
Glass of claret for that man to wash down his pork pie 🙂
That made me laugh. Nice one.
Outstanding sir, a diamond amidst a sea of dross,,,,,”just a load of made up pish”.
Gentlemen i give you the world according to Neil and Stewart.
It wasn’t necessary for sevco to change name only a good move by green in order to sell shares later on. After all that is the real end game and who would want a share certificate on their wall saying sevco when they could have “The Rangers Football Club Ltd”. Before the name change it was sevco trading as “Rangers Football Club” which is what a lot of EPL clubs do.
I think that what is very telling here is that no actual complaint has been made regarding the impartiality of the Commission in spite of all the mouth music and mumblings coming from Green.
When the chips were down no actual evidence could be produced. This is important because if any actual evidence existed the fitness of the tribunal should have been tested in an application to court. Obviously if the court held in favour of Rangers that, quite rightly, would have destroyed the SPL case and I really doubt if it could have been resurrected.
It seems to me that the ‘impartiality’ argument is now lost to Rangers and even if I am wrong in this and Green now turns to the court to find in his favour he faces the problem of the beaks asking him: ‘Well, why didn’t you put this argument to the Commission direct or indeed seek a legal remedy prior to the Commission starting its proceedings or even state the case in writing.’
It appears that Green’s defence can only be that the SPL and by extension the Commission have no legal grounds to act against newco and if the Commission have got the legal argument right then it appears they have.
Of course we don’t need to wait until the Commission meets in Novermber for the next round as the Disciplinary hearings on ‘bringing into repute’ take place in October. Is that when Green will unveil his ‘evidence’ of partilaity?
If it is methinks it will need to be a helluva Big Bazooka. If he has none then thinking Bears must surely ask themself just how safe a pair of hands that the future of the Ibrox club is actually in and I choose the word ‘club’ deliberately as I have always been of the opinion that a football club exists in the hearts and minds of its supporters and may be owned from time to time by a whole range of people ranging from philantrophists to gangsters but the club continues.
I also wouldn’t be that sure that stripping of titles is anywhere near on the cards now because of the continuing nature of the ‘club concept’ as spelt out by the Commission. Legally, if found guilty, titles can be stripped but I really have the feeling that the punishment will not be aimed at supporters but at the owners and that makes me think that it is now more likely than ever to be a financial one,
Does anyone have any ideas on the ineligible players angle or is it just that the operation of dual-contracts makes them ineligible?
The question is, what exactly did green sign up to when at the 11th hour he got the SFA membership. This could easily include liability for the past actions of the”club”. No wonder he’s worried
@ Grabthegrass
I’m sure the snake-oil salesman will be able to explain-away anything to his attentive and adoring audience at least for the moment.
Right now it is only the possible dual contracts that make them ineligible as it seems that they were officially registered by the SFA and the SPL. I think it would have been too easy for any club to protest against, lets say, 8 players on a pitch, who are not known to the SPL 🙂
And it is not the operation of dual-contracts by itself that makes them ineligible but the missing notification of these second payments to the authorities. You can have as many contracts as you want as long they are in writing and approved by the SPL.
I would like to refer to a previous point made by you: HMRC and Newco.
I can’t see a scenario where Newco can be seen liable for oldco tax debts.
First of all this is now the real world and not football. Here it is all about legal entities and as oldco has been the employer of the footballing staff and therefore responsible for PAYE and NI and not the club. The club seems to be just an asset. Compare it to the situation Coca Cola is in administration and sells the intellectual property rights to Coca Cola to you. Can you now be held responsible for the debts of Coca Cola just because you produce the product now?
Secondly if HMRC regards NewCo as phoenix they are just entitled to demand a disposit for the VAT from phoenix up to 6 months of VAT payed by the oldco but not liability for oldco debts
Interesting point by the way: this seperate entity of a club when the holder is a company only exists in Britain. Germany now has something similar but better regulated as the club still stays to be an association but can transform it’s professional footballing section into a corporation with the club the major sharholder. So if this corporation gets liquidated the club lives on. It is actually the other wa round than the UK system. Here the club holds the company and not vice versa.
Last thing that caught my eye (and Paul’s as well as I have seen) is that the SPL breeched its own articles of association and the commission confirming that Rangers ceased to be a shareholder with the transfer of the share to Dundee.
Article 6. A Share may only be issued, allotted, transferred to or held by a person who is the owner and operator of a Club and if a Member shall cease to be the owner and operator of a Club then such Member shall cease to be entitled to hold a Share.
So actually with the sell of Rangers FC to Sevco Scotland Rangers FC plc ceased to be entitled to hold the share. Strange that the SPL didn’t notice this mistake.
@ Mícheál
I accept that it is highly unlikely that under current legislation that HMRC could recover oldco debts from newco but what I was trying to say is that it might create a catalyst to tweak existing legislation or indeed introduce new legislation to cover the loophole. HMRC haven’t covered themselves in glory over Rangers and the revenue lost and if they can deflect Treasury heat by suggesting legiuslation change then they most ceertainly will take that road especially if the industry Regulator is in broad agreement.
On the share ownership issue I wondered about whether this could have arisen because of the need to protect the value of creditors’ assets in administration?
Ecojon, you think that any punishment will not be aimed at (rangers) supporters. The problem with this approach is that supporters of other clubs lose out if match results are not reversed due to rangers fielding ineligible players.
@ Michael
I think the biggest bar to deciding on punishments is that you have to first establish whether legally there is guilt and the actual extent to that guilt and period covered. I would expect, say for argument, that if only one season was declared to be in breach of regs then the punishment would be much less than if it was 10 seasons.
So till we get to that stage I’m not sure how productive it is to discuss sentencing as it is a bit of cart before horse.
Excellent analysis Paul – my legal knowledge has increased significantly since I started reading your blog
Can anyone request to defend the Rangers case at the commission if newco and oldco arent comin out to play? Could i declare myself as an interested party that believes, hypothetically, there is a defence to be put, and request to make legal representations and arguments? Whats the legal position? Can the Rangers Supporters Trust send a lawyer along to argue their case?
@ Carl
They don’t have any legal locus to act as they do not represent the parties viz oldco and newco but are purely third party entities who may be interested in the actual outcome but have no legal input to make.
I certainly feel for Rangers supporters whose ‘club’ and again I deliberately choose the word could be in real ‘danger’ and I ain’t just talking about stripping titles and yet no one has the balls to appear and put the argument for them.
Of course the problem is that they know they haven’t a shred of evidence to prove bias and that is what their ‘defence’ was predicated on to whip-up supporters.
Hot-headed words whether in English or Old French don’t cut it with their Lordships who quite rightly know that: “The question is whether the fair-minded and informed observer, having considered the facts, would conclude that there was a real possibility that the tribunal was biased.”
To this may be added that the “fair-minded and informed observer” is “neither complacent nor unduly sensitive or suspicious”.
Well that certainly seems to describe a helluva lot of Rangers supporters and would seem to exclude them from appearing in front of the tribunal as well.
I think that opportunity does exist but you must make case for the right to appear by a certain date. Can’t remember that date.
@ Michael
Don’t think there is a right as the tribunal remit is:
“G1.1 The Board and, where appointed by the Board, a Commission, shall have the power of inquiry into all financial, contractual and other arrangements within, between and/or amongst Clubs and Players and all matters concerning compliance with the Financial Disclosure Requirements and into all matters constituting or pertaining to any suspected or alleged breach of or failure to fulfill the Rules by any Club, Club Official and/or Player or any matter considered by the Board or, where appointed by the Board, a Commission, to be relevant to an Adjudication or an Appeal and every Club and Club Official and Player shall be liable to and shall afford every assistance to the Board or, as the case may be Commission, as may be requested or required of it or him.
No way anyone else such as supporters’ organisations covered by remit and what would they actually have to offer in way of evidence as opposed to suspicion or belief?
ecojon, the commission stated in 54.3 that:
….. anyone claiming an interest can make a case to appear
@ Carl31
Have also copiued this to Michael.
Don’t think there is a right as the tribunal remit as remit is:
“G1.1 The Board and, where appointed by the Board, a Commission, shall have the power of inquiry into all financial, contractual and other arrangements within, between and/or amongst Clubs and Players and all matters concerning compliance with the Financial Disclosure Requirements and into all matters constituting or pertaining to any suspected or alleged breach of or failure to fulfill the Rules by any Club, Club Official and/or Player or any matter considered by the Board or, where appointed by the Board, a Commission, to be relevant to an Adjudication or an Appeal and every Club and Club Official and Player shall be liable to and shall afford every assistance to the Board or, as the case may be Commission, as may be requested or required of it or him.
No way anyone else such as supporters’ organisations covered by remit and what would they actually have to offer in way of evidence as opposed to suspicion or belief?
Thank you Ecojon.
I asked as a Celtic fan, but wondered if the RST would be up for using their fighting fund to pay for a lawyer or two, if allowed?
I posted a week or so ago that Groan was leading the once great institution of Scotland to the fringes. This dummy out strategy seems to be a further step of disengagement with mainstream football opinion (but agreed he has form) and makes Rangers look ridiculous. Groan, in effect, argues that seeking for the rules to be applied is a form of bias.
Perhaps you could buy the right to defend.:)
@ Michael
Obviously the range of sanctions that could be employed is vast and I was just really extrapolating from the continuing club concept. Any financial penalty on the club could impinge on supporters as it might mean less being spent on players and facilities or even in payments to mystery investors who I very much doubt are supporters.
The problem I have always felt about altering match results is not so much the re-distribution of prize money at the top which would require to be funded from Rangers I would imagine. No the problem for me is how do you adequately deal with the relegation aspects and financially compensate the teams that shouldn’t have been relegated.
Of course there is an interesting comparison here with chico’s old club – well at least where he put in a fleeting appearance before being removed from dealing with team affairs – it is of course the case that Sheffield United brought against West Ham for fielding a supposedly ineligible Tevez.
United were relegated from the SPL and I think West Ham ended up paying £20 odd million to Sheffield in compensation. Other teams also sued but from memory I can’t remember the amounts. The whole affair is well documented on the internet for anyone seeking more info.
Could Rangers afford to pay the kind of money involved as we couldn’t ask clubs who were ‘wrongly’ paid money to pay it back as they didn’t do anything wrong and to be fair they might have a good argument that the authorities should have been running a tighter ship. There is no doubt in my mind that Scottish Football couldn’t afford it.
So do we liquidate the assets of Rangers newco to pay it and would that really be in the best interests of Scottish football or just vindictiveness. I think there are a helluva lot of difficult questions which surround the issue and not a lot of answers to resolve it.
Personally I don’t want Rangers destroyed as I do believe that as a ‘club’ helping generate finance they are important to Scottish football and that is why I go for a hefty fine if found guilty which is redistributed to SPL members clubs. The SFL not wanting to upset the gravy train from their new-found friends are happy to leave Rangers with titles so that’s up to them.
However, if Rangers continue with this nonsense of clubs not being welcome at Ibrox and deliberately boycotting teams whose chairmen have the misfortune to have a glass eye then rangers cease to be of any value to Scottish Football and can play behind closed doors to an empty stadium. If you don’t want to be part of an Association in the fullest sense then you can GTF in my book.
I have more or less always thought that the titles concerned are ‘tainted’ and I wouldn’t want Celtic to accept them if they were stripped but at the end of the day the Commission are the ones who will make the decision and, of course, we should remember that they may well impose more than one sanction.
OOPS – Freudian slip again – United were never relegated from the SPL but who knows if chico hadn’t walked then I’m sure that would quite possibly have been achievable 🙂
Most people don’t want the titles and trophys a do a paid gOod money throw the years and always thought it funny about there signings a think Celtic should take the titles and highlight what happened as its only fair on the fans who want them there tainted but the are soon to be legally ours
@ Mick
To be honest I’m easy on the issue and will accept the Commission decision althogh I would rather see the punishment put money into the SPL as I think that more important than the titles as there is no absolute proof IMHO opinion that the financial doping did actually produce results.
Don’t get me wrong, I believe that the intention at the top was that it would but gang aft agley comes to mind 🙂
I would be a lot happier with the ‘club duality’ concept if the assets listed in the asset purchase agreement set out what constitutes ‘Rangers FC’ for those purposes.
I grasp that a ‘Club’ is the entity with legal personality, rights etc, and that there also can exist a ‘club’ within it, that has none and needs the ‘Club’ that operates it in order for it to exist at all, but I would be happier with this if the ‘club’ had been defined in some way before now and maybe could be pointed at.
I’ve long held the opinion that the law has to be set aside to argue the ‘eternal club’ case, so its no surprise that LNS states the ‘club’ has no legal personality, but I would think the footballing minds and legal minds would have been able to get together and define it.
Duplesis set out a range of cases in brief of UK club insolvency on these pages some days ago – a very interresting post it was too – and this state of ‘club duality’ wasnt shown. It was mentioned that authorities ‘consider’ clubs to have continued or clubs are ‘regarded’ as having continued, but the latest from the SPL Commission seems to be the first instance of setting it out.
I suggest that the Rangers Saga leading to where we are is unique in that the authorities have to investigate and rule on potential wrongdoing of a club/Oldco upon an unprecedented scale and impact.
@ Carl31
I think it might be easier to only refer to ‘club’ when we talk about the enduring concept with no actual legal personality and to use operating company for the legal personality which runs a football business. There may also be a holding company with another separate legal personality where assets are held and indeed there can be many layers of this which even spread offshore.
I had sought to describe my thoughts for that one post alone – not propose terms to be used henceforth.
There are problems with that too. Greatest respect to LNS, but there appears in the document produced here some new football concepts, for legal purposes.
Consider how the terms you advise would have applied for last season’s Rangers. If the principles as set out LNS are applied to then, Rangers FC was the club but the company owner and operator was Rangers Football Club Plc. These terms would have been required to be used. And then MHL? If we had referred to the operating companies when required and the ‘club’ when required it would have resulted in footballing reportage or dealings referring to something different from the business pages.
(but each was referred to as Rangers, without issue since they were one and the same).
Ante insolvency event, this use of different names would have been daft, because the activities were of Rangers – club and company as one, and nobody had any issue at all with this. No ethereal/eternal/other idea of the club was even considered until post insolvency event.
I suggest FC and Clubco be used :O)
I’m confused.
Think of Rangers the club and Rangers the company as parasite and host, locked together in a parasitic relationship. Once the host was sucked dry, the parasite moved on to a new host.
Or CocaCola the drink/brand and CocaCola the company. Different things, but inextricably linked.
@carl31
You may well be right that the RFC case will end up being the definitive authority on the question of the distinction between club and company – as you say, due to the level of investigation which is being undertaken in this case.
That said, the idea doesn’t seem to be a new one, the English clubs I referred to did simply continue in their newco form, and have retained their history as far as the governing bodies are concerned, which when all is said and done is really what the issue is about for RFC supporters. For the reasons I mentioned in the earlier post, the position in the earlier cases doesn’t seem to have been analysed by the Courts though.
The idea is also at least alluded to by Lord Hodge in the Ticketus case, and by Lord Glennie in the judicial review case, albeit the concept wasn’t necessary to either decision, so is probably obiter.
As I said in that earlier post, I think “club” is analogous to “business” in a normal business sale from administration/pre-liquidation. Lord Nimmo-Smith uses the term “undertaking” to describe the club and says it is no different from any other undertaking, and may be bought and sold. I think that’s really the same point.
“Undertakings” and “businesses” are regularly bought by one company from another, and can be so bought and transferred whether the transferor is insolvent or not. In that sense, the concept of a business/undertaking surviving the extinction of the company which owns it isn’t that novel.
I’m not sure the “club” or “business” or “undertaking” is a completely separate asset to things like IP/goodwill. Its may be better seen as a parcel of these individual assets, which together form the “business,” so I’m not sure that a separate entry showing a sale of “the business” or “the club” is always necessary in the sale.
Cracking post. Spot on.
The decisions reached by the commission are, as you would expect, well made and backed up by legal reference. I don’t think there can be any doubt now that there are matters of some significance to be considered and that both “Oldco” and “Newco” would be served better by representation than not. While I defend anybody their right not to take the stand and be cross examined, as doing so may incriminate them, I’d advise strongly that some form of legal representation should be present to ensure fair play.
I can understand that Charlie may not be fully informed of the dalliances of his predecessors and in the limited period available to him may never get up to speed, but he must be well enough briefed to realise the damage that may be inflicted upon his fledgling company by any adverse outcome. surely adopting the ostrich approach in neither in his best interests or sensible.
Regarding the “club” / “company” ruling. In my opinion this is the correct decision and Paul pointed this out many months ago on this blog.
A club, in my opinion, survives because of the people who have been part of it over the years, who have supported it through thick and thin and who will still be there no matter how many owners come and go. Sometimes a club will fail – Third Lanark, Airdrie, Clydebank, Gretna – but supporters who were at the heart of these clubs still have memories and had they the facilities would readily resurrect them to their previous status . In the instances of these four clubs there is ample proof of clubs being entities beyond the corporate dabbling of “local businessman come good” or major financial players. The town of Airdrie found money men to come in and resurrect a team who bought the failing Clydebank FC thus claiming their league status. Clydebank has now re-established and is flourishing in the Scottish Junior league. Gretna is now operated by the Gretna Supporters Society and is playing in the East of Scotland premier division and even Third Lanark have re-established albeit it at a youth level for now.
Rangers, as a football club would never have been allowed to die. Not because of there are money men willing to invest (so CG continues to tell us) but because of the voluminous loyal fan base of the club. I don’t think for one minute that if Rangers had, or indeed do, lose their stadium, training facilities and other assets to the men from BDO that Rangers would not survive as a “club”. Charles Green would disappear like snow of a dyke along with any glory hunting fans but the loyal fans would, after the initial glitches, reform the club and move forward again.
There is also for me a clue in the rules of the SPL.
If a philanthropist of the kind of Andrew Carnegie for instance ( let’s not engage in talk of benevolent Arab sheiks ) wanted to “assist” a football club but not own them. He donates money to the committee to “assist” with ground ownership and running costs but stays always at a distance, who then would be the owner and operator of the “club”?
The “club” would be the only logical entity that could hold the SPL share. The committee of the club, would by fund raising (through a benefactor or not) be responsible for the day to day running and financing of the operation and the committee would be answerable to the SPL and SFA.
These are the rules as I see them. The owner and operator is the one who hold the share but their is nothing to say that the “club” and the owner and operator cannot be the same entity.
If therefore the committee of the club breach any SPL or SFA rules by, say playing incorrectly registered players, then it is they and therefore the “club” who are liable for any punishment arising there from. Mr Carnegie while supplying the operating cash and perhaps suggesting how best to run the club, is immune from prosecution. The club carries the whole burden.
If the benevolent Mr Carnegie were to leave the scene, let’s say he dies and leaves no legacy, and no other benefactor were forthcoming, the “club” would still be the “club”. As the money dried up they would not be able to operate a stadium and would therefore have to relinquish their SPL share. That share passing to some other organisation who could fulfil the operating obligations imposed by membership. The club would be eligible for a place within the SFL as at this stage would retain it’s membership of the SFA.
Depending on the fundraising capabilities and financial expertise of the committee the club could survive in a division of the SFL (let’s say division 1) for as long as it could fulfil it’s obligations to that league and it’s structure. They may be relegated from that league as they find their feet and establish a proper structure to sustain themselves.
The pendulum could go swing either way at this juncture. If it swung in a positive direction for the club, they may be promoted through the leagues and eventually regain their SPL status. If the pendulum swung in the opposite direction then the club may end up in the Junior League, Amateur League or Youth League.
They have no owner and operator other than a committee of dedicated individuals but they are a “club”
Am I the only one to wonder what exactly is in the 5 way agreement? Has it been made public? It would be really interesting to see what green accepted in terms of liability for past misdemeanours of the “club” he had just bought. This is what we really need to know.
@grabthe grass
Well for sure the VB make a big play re the 5-way agreement and how it reveals all the hidden SPL/SFA/Celtic manipulation.
Amazing it was produced just before the release of the Commission statement when one would have logically thought that the place to present it was to the Commission or a court to prove bias.
So I’m afraid that’s where the need to know basis lies. Perhaps the document will be provded for the October or November hearings so that it can be examined. I wonder how the VB got a hold of the agreement although I’m sure Mr Green couldn’t have been responsible for its dissemination.
These days when dealing with sensitive documents it is common practice to ‘mark’ them in a way that remains ‘invisible’ so that even photocopies can be traced back to the original person it was distributed to. So I await with interest to see if the original or a photocpy is produced so that the trail can be established. Oh what fun might lie ahead 🙂
@ Grabthegrass
I should have said, in case you are unaware, that various Darkside websites are running purported copies of the Zinoviev Letter erm sorry 5-way agreement if you wish to learn THE TRUTH 🙂
I would of course refer to the reasonable person test as outlined by the Commission.
@ Grabthegrass
I have posted on the 5 way agreement below which might interest you.
@ Robert D Bruce
I think the problem with the concept of the ‘club’ you envisage is that an unincorporated club can have no legal identity and that can be a very difficult barrier to operating anything beyond a very small organisation.
There is also the problem that there is joint and several liability of the ‘club’ memebrs so that if one of them runs up a fortune in debt and disappears then a creditor can pick any member to get the money back from or indeed all of them.
It really isn’t a basis for setting up anything operating even as a low-level commercial operation.
However it certainly seems that a ‘club’ with no inherent legal personality can exist without an owner and operator as far as the Commission is concerned which certainly takes a bit of getting the head round 🙂
@ecojon,
I don’t think for one minute that the scenario I set out is a feasible one in this day and age and I don’t mean to imply that it is a practical solution but I does address the point that the commission is making.
There need not be a corporate body. An unincorporated club with a wealthy benefactor to finance it ad infinitum would leave only the “club” and no “owner and operator”. Given that all the liabilities of the unincorporated club are borne by the benefactor there is no need for any member to be concerned with joint and several liabilities. An unincorporated club is not a person in law and CAN therefore exist devoid of an owner and operator.
@ Robert D Bruce
If only Carnegie were alive today 🙂
@ecojon
His philanthropy lives on ecojon.
As some wise old owl once said ” How do you get to Carnegie Hall son? —— practice” 🙂
@ Robert D Bruce
Never heard that one before – like it 🙂
parallel universes are operating here. is it very likely that anyone at the club be it owner player or supporter is going to say, gosh you know old nimmo is right, so we must take our medicine? nope, all they are interested in is the game and in some respects I have a sneaking sympathy for them ( but not much). when the legal boys get down to discussing what the definition of is is , it is difficult to reconcile this approach with the sometimes thrilling end product we all like to watch. in passing have the msm carried the Opinion and if not why not?
@ p groom
Haven’t actually noticed it anywhere but these days I tend only to buy Sundays which, as they deteriorate and decline, concentrate more on a reprise of the past week rather than earth-shattering exclusives.
To be fair it is a difficult one for them to handle other than just to note it has been issued.
I’m not so sure that all Bears are ignoring the problems ahead and more will increasingly wonder why no one is actually showing the evidence to the Commission and fighting for the blue corner.
Has anyone actually worked out what the various league positions would have been if every game in which Rangers allegedly played an illegal player was awarded three nil to the other team. The cups would be impossible to work out though and I suspect that they would be better off annulling the competitions for those years as the only alternative would be to replay all the games that would have been. And that would be daft.
Something that has been bothering me for some time is the notion that someone might or might not be punished enough. The argument has been put forward often enough by Rangers people at the club and in the media. Some of them even with the honourable intention of avoiding the complete destruction of Rangers as a football club. Others just trying to avoid just punishment. Now that we have proper legal minds involved as opposed to the altogether different kind of minds of the people at the SFA, SPL and SFL, I expect we will hear no more of this nonsense. After all when trying a serial offender, the courts don’t stop after allegation number seven because the accused has already been found guilty four or five times already, or because he has already been sentenced to life imprisonment.
If Rangers are found to have breached the rules, then I rust each and every instance of wrongdoing will be prosecuted. If that means the club fails to survive in its current or former form, then so be it. I say that not out of a desire to get rid of Rangers but out of a desire to regain some credibility for Scottish football. It is not above the law and cannot make wee deals on the side to fix what it sees as administrative problems.
WELL I’VE SEEN IT ALL NOW 🙂
The Sun has today run an exclusive story based on a secret document based on the stripping of Rangers titles. The source of the document was Charles Green according to the Sun.
However, the same ‘secret’ document was revealed by the Record on 18 July – Sun really is up to date. The source is unknown at this time.
More importantly though is the ‘slant’ put on the story by the Sun which states: ‘The package of punishments — instantly REJECTED by Green’.
Whereas the Record, almost two months earlier and therefore possibly closer to the actual truth, stated: ‘It remains a draft, and no agreement has been reached between Sevco and the authorities. But it appears Green’s firm were willing to accept some if not all of the draft – at least when the prospect of Division One football was on the table.’
I have the feeling that this may well backfire big-time because if Green actually felt there was anything of value to his case in this why didn’t he either go to the Commission hearing or take legal action to prevent is sitting. Quite simply because the draft proves nothing that isn’t publicly known and that it was an attempt to try and minimise the financial damage that could be done to Scottish Football.
Personally I think it was misguided but FFS Green was handed a copy of the draft so how was it a big secret. I really hope he goes before the court in Edinburgh to argue his case as they could charge for tickets.
The Record observes: ‘The document also contains an ultra-strict confidentiality agreement. It states: “Neither RFC nor Sevco may make any disclosure to a third party, press release or public announcement whatsoever about, concerning or relating to this agreement … except with the express prior written consent of each of the SFA, the SPL and the SFL”.’
Things must be getting desperate down Ibrox way – first the VB are roped-in and get a document that was handed to the Rangers Boss and now the Sun get it from him. But the Record published it in the middle of July.
Well it really does appear that you can fool all of the Bears all of the time – smoke and mirrors don’t have a look in with old snake-oil 🙂
Read more: http://www.thesun.co.uk/sol/homepage/feeds/smartphone/scotland/4551484/We-see-secret-document-that-says-Hampden-beaks-wanted-Gers-stripped-of-9-trophies.html#ixzz27CmxoaZN
http://www.dailyrecord.co.uk/news/scottish-news/revealed-football-chiefs-secret-plan-1167046
@ecojohn
The prize money: way back when this was first realised that by stripping the titles, implications might surface regards all the money awarded to Oldco over the years for “winning”. Once I realised how complex this hypothetical scenario was, I switched off.
Over the months I have calmed down a bit and decided (if guilty) that the best way forward would be for the titles to be removed and let history show that Celtic were never awarded or sought to claim these titles, but that Oldco were caught cheating.
I think that Ben Johnston although stripped of his Gold medal, is still shown as the man who won the race. History shows him as a disgrace to sport though.
Fines money awarded to other teams or God forbid into the SFA/SFL/SPL coffers, not for me either.
I have a dream and in my dream whatever we want to call them have been found guilty and ordered to re-brand themselves completely. A complete change of name, shirt colours and everything that makes me and many others, dispise their actions this century.
Or complete removal from football:)
@ jedi01
One of the reasons I have turned away from the title-stripping in a sense is because I think that there is some merit in the argument that since that is what Green continually bleats about preventing, then that isn’t actually what worries him.
The other thing about title-stripping takes us into the difficult area of players’ medals. How do you deal with that one and do you deal differently with players who had EBTs and those who didn’t.
Even with the ones that had EBTs I think there is a reasonably good argument that if they hadn’t been given the money they wanted then they wouldn’t have come to Rangers. I realise some bears argue that Murray could have paid the money anyway in a straight contract which, to coin a phrase from mick, is ‘delutional’ in the highest order as the club only ‘looked’ healthy in financial terms mainly due to the asset valuations.
These players knew what they were worth and didn’t care how that amount was paid as they weren’t breaking any law with the paperwork being the responsibility of Rangers and I doubt if the players would have understood the tax significance of side-letters – their agent probably did but were players told – who knows?
Sadly I don’t think a rebranding exercise would work as the ‘product’ would remain the same and as long as that is based on an unhealthy base with nothing to do with football then things won’t change just as the leopard can’t change its spots.
I had hopes that SFL3 would be the making of a strong decent support for Rangers which rose above the nonsense but I’m beginning to see SFL3 teams seduced by the money just as some SPL clubs were happy to take the money of the Celtic and Rangers travelling support and let them sing whatever they wanted.
One banner displayed recently by Rangers support at an SFL3 ground is sickening but it would appear nothing is being done about it as it would mean the SFL3 falling out with their new pals. I wait with interest to see what happens if Rangers are trounced away from home – that could well be an eye-opener. But they may well behave and accept that it is just a game of football.
“The other thing about title-stripping takes us into the difficult area of players’ medals. How do you deal with that one and do you deal differently with players who had EBTs and those who didn’t.” You deal with them the same way as the IAAF deals with relay medals – if one relay medallist has doped, then all lose their medals.
I agree, title stripping is a red herring? Fines, suspension or sine die from the top tier of Scottish Football would be a greater worry with flotation imminent.
And with flotation imminent what are the ramifications for Gratuitous Alienation if D and P still in charge of admin when this happens?
http://www.channel4.com/news/where-would-rangers-trophies-go
the medals and money via the financial doping years is just not possible to swap over but the titles and cup winner cliam is stripped and gave to nearest contender these are legal rules uefa fairplay ,its not just celtic due cups and titles theres a whole host of teams .
@Marching on To get her (Have you still not found her yet?)
“Look at AFC Wimbledon, recognised by everyone, except some green-tinted Rangers haters, as the successors to the history, tradition, and honours of Wimbledon FC of the Crazy Gang et al. Because the fans decided it was so.”
To every Celtic fan reading this. Tell every Celtic fan you meet, to claim that
it is Celtic, not Real Madrid, who have won the European Cup 9 times. Don’t worry, it doesn’t matter what anyone else says. Why? Because the fans decided it was so. Recognised by everyone? That must have been one hell of a survey you did. I am not a Rangers hater with green skin, but I believe you are wrong.
I just bought a 2012 London Summer Olympics, Mens 100 meters Gold Medal. Does that mean I ran 9.63 seconds on the 5th August?
If The Rangers want to be the same club, the one that is all but liquidated. Then I have no problem with that. As long as they accept responsibility for the debt that was amassed. That ain’t me saying that. That was Hector.
And Marching on Together, if you think that the club and the company are seperate:
If that doesn’t clear things up for you, nothing will.
So the SFA, the SPL, the SFL, Lord Nimmo Smith and his Commission, the Court of Session, the Football League, the Premier League, the FA, the fans of 92 clubs in England, and the fans of 41 clubs in Scotland, are all wrong eh? It is you and your green-tinted mates who are right, and Rangers and every other club which went into administration like Rangers, are dead just because you say so? Aye, right.
The club is different from the company that owned the club. Deal with it.
How did David Murray and Craig Whyte take control of the club?
Murray and Whyte acquired ownership by acquiring sufficient shares in the company which owned the club.
To put the question back to you though, how did the current owners of Crystal Palace, Plymouth Argyle, Rotherham, Luton, and Leeds acquire ownership of those clubs?
I have no idea, I don’t follow English football, nor do I see the relevance of it when speaking of Scottish football.
If the company owned the club, then surely it must have been listed as an asset in the accounts of the company for all these years?
Strangely enough, I can’t seem to find any mention of it being listed as an asset of the company at any time.
The reason that English clubs are relevant is that insolvency and administration law in Scotland is exactly the same as in England, and is set by the UK parliament.
Here’s a challenge – find the drink Coca Cola listed anywhere on the balance sheet of The Cola Cola Company. It’s not. So according to your logic, The Coca Cola Company don’t own the Coca Cola drink.
The club Rangers is made up of different aspects, which are listed in the balance sheet of its parent company under various headings.
Marching on Together….are you able to enlighten us on FIFA’s stance concerning a club being separate to company…in accordance to their Rules and Regulations?
the club died its a cloned pheniox tribute to fill greens pockets hes sold the toxic carcass now the law will kick in and it will be insiniraded and the buyers left out of pocket bar greens team “cash at the gate”
Mick,
invest in a spell checker or better still do your replies in Word first, which will check your spelling for free, then cut and paste them on here.
Otherwise it takes away from what you are trying to say and lets people take the piss with you.
HH
In my view the ‘Five-Way Agreement’ is a misnomer. It was really between the SFA and newco Rangers –
1) Only the SFA had the power to issue a Licence to newco Rangers.
2) Only newco Rangers could agree to the conditions required by the SFA.
Whilst the other 3 parties may have made input which helped the SFA formulate their conditions,they were not really party to the agreement to issue a Licence.
Or is this too simplistic?
@ hughmcvey
The 5-way agreement was never an agreement in the first place – it was part of the negotiation process designed to parachute Rangers into SFL1 because of the real fears of the authorities about the financial stability of Scottish Football especially with regard to the TV money.
I don’t think the authorities handled it too well but they knew that no matter what they did there was going to be pretty fierce opposition from various quarters.
There is no doubt that some of the things in the draft were agreed to by newco – it is unclear exactly what was and what wasn’t – but when the SFL1 option was taken off the table then it appears Rangers spat the dummy.
Then in mid-July the draft was leaked, it was leaked again to the VB a few days ago and then leaked again to the Sun yesterday by Green, according to the newspaper, despite the confidentiality clause.
I think that says quite a lot about Green but how anyone, even a crazed MSM jouno, can claim it’s a secret just bewilders me, The SFA, SPL, SFL, Rangers and presumably other clubs were aware of the draft. It was part of a process which was sunder discussion but which ceased to have any relevance when SFL3 became end of the line for Rangers.
What possible connection it has to the current Commision’s deliberation on EBTs escapes me. Punters that have never been involved in a complex multi-party negotiation process don’t understand that many drafts end up being worked through in a bid to find a resolution and with the 5-way one we just don’t know what was actually agreed to by Rangers prior to the draft being prepared.
The timing is important not just of the SFL1 parachute failure but in the determination of Rangers fans not to buy season tickets and the seeming absence of big investors. This would have caused massive pressure on Green and I wouldn’t be surprised if Rangers were happy to pay the price of title-stripping to get a guaranteed pass into SFL1 with the prospect of SPL football the following year.
It would make the AIM Flotation more attractive especially by bringing the possibility of European football so much closer. Are the nuts and bolts of what happened important – yea they are but they ain’t terribly urgent and will have no impact on the October or November hearings that Green faces.
But if Green really does think the draft reveals some kind of conspiracy by parties known and unknown and he didn’t actually agree to anything contained in the draft then he owes a duty to Rangers to take the matter to court to ascertain the truth and slay the paranoia dragon. Of course if he loses it could seriously the AIM Flotation and everything is riding on that.
the 5 way agreement is a made up cluse to produce a sevco for new season its not going to well the sfa and spl deal makers must be wondering what they are in for with all the toxic debt and saintions ahead
its looking like the end agian as the whole feel throw out the net is expultion and the title stripping is not a santion but part of the course of justice after sentance
when rfc died dundee got there spl share that left a gap no place was put out for bids to join the sfl and sfa let rangers in and have a licence not on merit the 3 years account rule also dont forget the olympics openning night ,the sfa are being blackmailed if greens behind the leaked document to the sun give me my own way or a will tell discredit sfa at time of nimmo smith report its all took a turn for the worst
http://celticunderground.net/index.php?option=com_content&view=article&id=787:did-the-sfa-deny-celtic-a-place-in-the-champions-league&catid=47:season-2011-2012&Itemid=83
The real scandal here is the position of the SFL in permitting one club, even if it is found to have fielded ineligible players, to remain to be the ‘winners’ of 7 League cup tournaments.
Is the SFL going to permit all clubs to field ineligible players without any action being taken, or will this permission only be granted to one club?
With regard the company/club debate.
I have a hypothetical question.
Some of this goes over old ground but I think my question is pertinent to the debate.
HirsutePursuit, SFM, posted this:
Click to access 03%20The%20Club%20as%20Licence%20Applicant%20and%20Licence%20(2).pdf
3.1 Definition of Licence Applicant
3.1.1 The Licence Applicant may only be a football club, that is the legal entity fully responsible for the football team participating in national and international competitions and which is the legal entity member of the Scottish Football Association (Full or Associate Member). The licence applicant is responsible for the fulfillment of the club licensing criteria.
Paul McConville posted this http://www.uefa.com/MultimediaFiles/Download/Tech/uefaorg/General/01/50/09/12/1500912_DOWNLOAD.pdf
“Article 12 – Definition of licence applicant
1 A licence applicant may only be a football club, i.e. a legal entity fully responsible for a football team participating in national and international competitions…
————————————–
I was under the impression that Lord Nimmo Smith was persuaded by the arguments put forward by SPL lawyer Rod McKenzie with regard to the definition of a club.
I was also under the impression that Rod McKenzie leant heavily on the SPL Articles of Association to prepare his arguments.
My question is this.
If the SPL fine Charles Green’s Newco after their Commission sits would he be able to win a civil court case on the basis that his club is not the old club and is indeed a new club?
I reckon there would be supporting evidence for such an action.
The SFA and UEFA Articles provide a far clearer definition of a club than the SPL’s, for instance.
Could Green’s layers persuade a judge that a club IS the legal entity and that both are one and the same.
They could point out that the recent court hearing involving Collyer Bristow in London saw the word club repeatedly used to represent the company.
“Initially Mr Withey responded by stating that Collyer Bristow did not hold any money for the club. Then he changed his story and said that Collyer Bristow was holding only £260,544.14 for the club.”
It appears that this did not confuse the judge sitting as he knew that the company and the club are the same and either term can be used interchangeably.
You could well argue to a court that in everyday parlance the club and the company are one and the same.
That’s why when fans buy shares in the club they are buying shares in the company. The fans know it is one and the same.
As do the quasi-judicial footballing authorities who spell this out in their Articles of Association.
So, to reiterate my question:
Could Green persuade a judge that Rangers Football Club Ltd are a new company and a new club?
With regard the company/club debate.
I have a hypothetical question.
Some of this goes over old ground but I think my question is pertinent to the debate.
The SFA articles say: 3.1 Definition of Licence Applicant 3.1.1 The Licence Applicant may only be a football club, that is the legal entity fully responsible for the football team participating in national and international competitions.
The UEFA articles say: 12 – Definition of licence applicant 1 A licence applicant may only be a football club, i.e. a legal entity fully responsible for a football team participating in national and international competitions…
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I was under the impression that Lord Nimmo Smith was persuaded by the arguments put forward by SPL lawyer Rod McKenzie with regard to the definition of a club.
I was also under the impression that Rod McKenzie leant heavily on the SPL Articles of Association to prepare his arguments.
I may be wrong about this but my question is this.
If the SPL fine Charles Green’s Newco after their Commission sits would he be able to win a civil court case on the basis that his club is not the old club and is indeed a new club?
I reckon there would be supporting evidence for such an action.
The SFA and UEFA Articles provide a far clearer definition of a club than the SPL’s, for instance.
Could Green’s lawyers persuade a judge that a club IS the legal entity and that they are one and the same.
They could point out that the recent court hearing involving Collyer Bristow in London saw the word club repeatedly used to represent the company.
“Initially Mr Withey responded by stating that Collyer Bristow did not hold any money for the club. Then he changed his story and said that Collyer Bristow was holding only £260,544.14 for the club.”
It appears this did not confuse the sitting as he innately knew the company and the club are the same for legal purposes and either term can be used interchangeably.
You could also well argue to a court that in everyday parlance the club and the company are one and the same.
That’s why when fans buy shares in the club they are buying shares in the company. The fans know it is one and the same.
As do the quasi-judicial footballing authorities who spell this out in their Articles of Association.
So, to reiterate my question:
Could Green persuade a judge that Rangers Football Club Ltd are a new club?
@RayCharles
One thing that is certain is that when you go to court then anything can happen as the perception of what rules mean can alter depending on the evidence presented, the arguments advanced, previous relevant legal decisions and precedents, and the way in which the whole ‘stew’ is devoured and then regurgitated as a decision by the Judge.
And then, of course, the decision is subject to appeal.
The process isn’t that far removed IMHO from a witch doctor picking over a chicken’s entrails and making a pronouncement to resolve disputes between attendant feuding parties 🙂
So the simple answer Ray is that we don’t know the answer to your question although we all have our own opinions 🙂
Sorry for two posts in a row and sorry for bringing religion into and sorry if this makes no sense to you but I can’t help thinking that Lord Nimmo Smith has ruled out resurrection while recognising reincarnation.
I have a lot of time for Hindu/Buddhist concepts about ethereal souls moving from one entity to the next but I am stunned that this sort of philosophical approach is recognised in company law.
This probably only goes to show my ignorance on the matter but I am genuinely perplexed.
As I’ve mentioned above, the concept of “the business” or “the undertaking” moving from one company to another isn’t unusual. In non-footballing insolvencies, “the business” is often sold from an insolvent old company to a new company.
“The club” equates to “the business” in this case, and I don’t think a court would find the concept particularly unusual. As I’ve noted above, the concept is at least alluded to by Lord Hodge and Lord Glennie in two of the recent cases involving a RFC. So 3 Scottish Judges appear to be comfortable with the idea.
Whilst it’s true Lord Nimmo-Smith’s judgement refers to the SPL rules, he makes the point that per these rules the club is just an undertaking, and like any other sort of undertaking outside the world of football, can be bought and sold by and from a corporate entity.
Lord Glennie made his comments in the context of a judicial review of the SFA articles and protocol – so not based on the SPL articles. Lord Hodge made his comment in the context of an analysis of the effect of a contract between the plc and Ticketus, so again not derived from the SPL articles.
I suppose the thing here is that it is relatively rare for a business or undertaking to be subject to disciplinary action by an external body. The only other example is possibly the financial industry where the FSA might impose fines on a “business” which had been sold to a new owner where the new owner is then responsiblefor the fine unless that had agreed with the seller that the seller remainedliable. All the indication s are that green agreed to be responsible for all
past debts and fines. We are in uncharted territory here and in the famous episode of blackadder when he went exploring and the foremost cartographers of the time gave him a blank sheet and asked him to fill it in, so the commission is being asked to do the same here.Good luck to them.
I agree with ecojon’s response to Mícheál:
“that it is highly unlikely that under current legislation that HMRC could recover oldco debts from newco but what I was trying to say is that it might create a catalyst to tweak existing legislation or indeed introduce new legislation to cover the loophole”
Looking back to the 12 June HMRC made the following statement (see http://www.hmrc.gov.uk/news/rangers.htm ) on Rangers Football club:
“A liquidation provides the best opportunity to protect taxpayers, by allowing the potential investigation and pursuit of possible claims against those responsible for the company’s financial affairs in recent years. A CVA would restrict the scope of such action. Moreover the liquidation route does not prejudice the proposed sale of the club. This sale can take place either through a CVA or a liquidation.
So the sale is not being undermined, it simply takes a different route. Liquidation will enable a sale of the football assets to be made to a new company, thereby ensuring that football will continue at Ibrox. It also means that the new company will be free from claims or litigation in a way which would not be achievable with a CVA. Rangers can make a fresh start.”
The key points draw from this statement is that HMRC from a tax point of view believed:
1/ Club can could be sold to the new company.
2/ New company would be free from claims or litigation.
However, that was the view held by HMRC back on the 12 June, which may have changed since then, and is clearly not the view held by some of the parties involved now.
@ Robert
I think that one area that it will have changed is the oldco £40 million tax loss, mentioned in Green’s share marketing pitch back in May, which it was thought could be retained by a newco. I just don’t see that being carried forward now but back then the loss was effectively another one of the very valuable ‘assets’ bought for a piddling £5.5 million.
“This suggests an answer to the Rangers – alive or dead – conundrum. The Club can pass from owner to owner, although it cannot do anything legally itself, not being a legal entity. Here the club has passed from oldco to newco.”
Hahaha.
Well said Paul. 😀
My big day of sport is not going well
Lewis with engine problem while leading
Score at Anfield not to my liking
Which leaves
Donegal for the All Ireland Final
(Just saw Neil being interviewed)
Rory going for $10 million in Atlanta this evening
Will not lose any sleep whatever happens.
My CPU is overloaded.Mr McBride used a tenth of 1% of his legal mind to drive a coach and horses through the SFA rulebook and was hailed as a hero,God bless his memory.
Sion attempted to use the law courts to overturn Uefa’s rulebook and were threatened with expulsion.
Carloway recommended a punishment that another wig overturned.
Rangers were castigated for taking football regulations to task in the law courts.The SFA ignored the other wigs ruling.
It was re-iterated that football clubs should process complaints through the footballing authorities and the CAS.
The SPL attempt to do a deal within their rulebooks remit?
The deal is refused and the SPL arrange a commission to investigate and rule using Scots law?
The edges of employment law and football contracts are blurred more and more by the day with Hearts wage disputes and Gers TUPE wranglings.
If Mr McBride was still with us it would be a joy to watch him destroy the SFA’s banner charge against Celtic.
He could use Nimmo’s ruling to prove that Rangers didn’t die,are therefore not zombie’s and that the banner wasn’t therefore offensive to anyone.
Insane?,,,yes!,,,wecome to Scotland.
Oh four more things, can anyone answer without me looking up the SPL rulebook,who pays for the commission members time?
Is it a no win no fee job?
Are the losers liable for costs?
Are we in a court of law?
After 20 years Sam is returning to Donegal.
A little tribute to Jim McGuinness the Donegal manager.
Sure with a name like that he couldn’t lose.
Cam,
I appreciate the overall sentiment of your post, but would point out that LNS hasn’t made a ruling. Its not been put to a court to decide yet. LNS through the commission paper of a few days ago has put an opinion.