Tag Archives: Mark Daly

Rangers, Sevco and the Law – Threatened Court Actions – Duff & Phelps v BBC

Following the BBC Inside Story, Part 2, recently it was made clear by Duff & Phelps that they were poised to embark on court action against the BBC.

As the Scotsman reported on 24th May, “RANGERS administrators Duff & Phelps last night threatened to sue the BBC over claims a senior partner in the firm was aware of Craig Whyte’s scheme to buy Rangers using cash from the controversial Ticketus deal.”

The piece quoted the statement from Paul Clark which said:-

“The allegations made in tonight’s programme against Duff & Phelps are untrue, a distortion of the facts and highly defamatory. Discussions are already underway with our solicitors with a view to bringing legal proceedings against the BBC.

 “We made a number of offers to assist the BBC in order they would not make the fundamental errors broadcast this evening and for some inexplicable reason the reporter Mark Daly declined these.

“We had also hoped to give interviews stating our case on camera but received strong legal advice against this course of action, bearing in mind the legal proceedings Duff & Phelps have raised against Collyer Bristow. The BBC were informed in writing from our solicitors.” Continue reading

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Filed under Administration, BBC, Defamation, Rangers

The BBC and Duff & Phelps – Emails Re Fees Quotation and Questions for David Grier

In which I:

Comment on the response of Duff & Phelps to the emails published by the BBC regarding the “fee agreement” with Craig Whyte;

Point out apparent differences between what D&P are saying now and what they said at the start of the administration process; and

Consider whether in fact Mr Daly could sue Mr Whitehouse for defamation, and thus leave D&P in court proving that they have acted properly, rather than having the BBC prove that D&P acted improperly (allegedly).

I also ask the following question:- What justified Mr Grier, in the summer of 2011, going to HMRC, a substantial creditor of his client, and telling them that he, they, the sellers of the business and the supporters and media have all been “duped”? Presumably Mr Grier got his client’s permission to breach confidentiality. If not, and he viewed this as such a fundamental breach of trust in the client-accountant relationship that he was justified in telling the major creditor that Mr Whyte was, to put it bluntly “at it” (allegedly), how could he, or his partners, continue to act for Rangers/Whyte/Wavetower/Liberty Capital?

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After Mark Daly’s further BBC programme about Rangers, its tax and financial affairs, and the role of administrators Duff & Phelps, there was a vigorous response from the Insolvency Practitioners. I wrote about their response and the questions that remained for D&P and its partner David Grier hereContinue reading

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Filed under Administration, Football, Rangers

Well Done to the Orwell Prize-Winning RTC!

I am delighted to see that rangerstaxcase.com has won the Orwell Prize for blogging!

The full story can be read here.

The judges commented:-

“The 2012 Blog Prize showed that not only could blogs comment on current events, they could drive stories forward.

“Rangers Tax-Case takes what might be a dry topic – the tax affairs of a sports team – and shows how a striving for transitory success has severely distorted sporting, legal and ethical boundaries.

“Displaying focused contempt for those who evade difficult truths, and beating almost every Scottish football journalist to the real story – Rangers Tax-Case shows how expertise and incisive writing can expose the hypocrisies the powerful use to protect themselves from the consequences of their actions.

It is a worthy winner which not only proves that independent blogging is as healthy as it ever was, but also offers a mirror in which our times are reflected.’

I have added the emphases.

This shows that the story is beyond the west of Scotland bubble – national recognition is entirely deserved.

And not just RTC, but Phil Mac Giolla Bhain, Paul Brennan, Alex Thomson and Mark Daly, not to mention many wise commenters and posters on websites, including those who make their contributions here…every one of you deserves credit for showing that big news stories can still get out, even if there is a deliberate or uncoscious wish to keep them under wraps.

Tonight maybe marks a watershed, or even a Wattereus, where the recognittion given to RTC combined with the BBC programme might ensure that sporting intergrity and values triumph over mere money.

There is a lot to write about, and I will get some thoughts up soon. Other pressing matters need my attention first, but I will make sure I post some thoughts…

HERE…

SOON…

Posted by Paul McConville

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Filed under BBC, Blogging, Rangers

Craig Whyte and Vital UK Ltd – The BBC About to Jog his Memory regarding his Disqualification?

Newsnight Scotland on 6th February 2012 will show more about Mr Whyte, unless his lawyers manage to stop the programme.

The programme will include a piece by Mark Daly, whose Inside Story in October brought threats of immediate court action upon the BBC from Mr Whyte (although no action has yet been raised.)

According to the BBC website, they have obtained a transcript of the judgement by which Mr Whyte was banned for seven years from holding a post as a company director.

This has been unobtainable up to now, although it is believed that it was being sought by lawyers acting for One Stop Roofing Supplies in its case against Tixway UK Ltd, a company where Mr Whyte is the sole director.

The BBC report quotes an exchange between Mr Whyte and the QC for One Stop, Alastair Clark.

“In court, he said: “This is going back to matters some time ago. I don’t have any recollection of what it was about just now.”

He was then asked: “You can’t remember why you were banned for seven years?”

Mr Whyte replied: “Well, I’m not going to say in open court and get it wrong.”

The Rangers owner was then asked: “Was it anything to do with the treatment of creditors?”

He replied: “No.”

The decision of Registrar John Simmonds regarding the disqualification was handed down on 13 June 2000.

In it, Registrar Simmonds is stated as having said “the assets of the company (Vital UK) were put out of the reach of the creditors on a somewhat dubious delayed basis”.

The ruling continued: “Shortly after that Mr Whyte put the company into a members’ liquidation disclosing promissory notes as an asset. This seems to me to be a self-seeking action with regard to the company. If this is too harsh, then the degree of recklessness shows Mr Whyte to be thoroughly unfit to be a director.”

Registrar Simmonds’ ruling concluded: “I have heard mitigation from Mr Whyte’s counsel that he is a young man and that some voluntary recompense has been made. There is nothing that I have heard that the self-seeking behaviour and deliberately placing of assets beyond the liquidators that would not make this a middle bracket case and I consider seven years the correct order and I so order.”

I have been trying to get to the bottom of this issue, and have been hugely helped by BillyBhoy68, but alas, we do not have the resources of the BBC.

It is interesting though to look at the paperwork I have been able to find regarding Vital UK Ltd.

I wrote about it here in December. As I wrote then and I apologise for quoting myself extensively:-

Vital UK Limited was incorporated on 15th April 1994 as Vital (UK) Ltd. The name changed to Vital UK Ltd (the brackets having been removed) on 31st August 1994.

On 27th October 1995, the company passed a special resolution (Vital Spec Res) resolving that it should be wound up. The resolution was signed by a “David Anderson”. This was a voluntary liquidation by the members of the company, and as such a Declaration of Solvency (a Form 4.70) had to be completed. The Declaration must:-

  • be based on a full inquiry into the company’s affairs;
  • state that all debts and interest can be paid within 12 months;
  • include an up-to-date statement of the company’s assets and liabilities; and
  • be made by the majority of directors of a company no more than five weeks before the passing of a resolution for voluntary winding-up of a company.

It is a criminal offence to make a declaration of solvency without reasonable grounds.

I have not been able to access the Declaration of Solvency. (But now see below!)

The liquidator was appointed with immediate effect and the relevant papers were received at Companies House on the 2nd November 1995.

The London Gazette of 7th November 1995 reported the appointment of the liquidator. The company was described as a “Dealer in all goods”. The same edition of the Gazette also reported the passing of the Special Resolution.

Vital UK Ltd (in liquidation) then lingered on for far longer than it had existed as a solvent company. The liquidation continued until, finally, the Company was dissolved in 2003.

The liquidator prepared a statement of affairs (Vital Statement of Affairs) detailing the financial position of the company as at 25th October 1996 and produced the statement on 6th November 1996. The liquidator noted that the company would not, despite the terms of the Declaration of Solvency, pay its debts within the required period of one year (which was by this point about to expire).

This disclosed the following:-

The only assets were Bills Receivable with a Book Value of £649,139 but an estimated sum recoverable of only £100,000.

The preferential creditors were as follows; VAT £33,039; PAYE + NIC £279,976.

The estimated trade creditors totalled £66,674.

There was £2 of issued share capital and therefore an estimated shortfall for members of £279,691.

Listed in the creditors is a balance of £40,042 owed to Custom Cleaning Services of Wishart Street in Glasgow. A quick search of Companies House shows that “Custom Cleaning Services Ltd” changed its name in 1996 to CCS 1996 Ltd. This company was wound up in 1998. Amongst its directors were David Anderson, who had signed the Special Resolution to wind up Vital UK Ltd, Craig Whyte and Kenneth McLeod.

Vital UK Ltd had a liquidator appointed on the basis that it could pay its debts. The directors, or at least a majority thereof, put their names to the Declaration of Solvency.

However, once the liquidator discovered that less than one sixth of the bills receivable were likely to be recovered, this made it clear that the debts would not be paid. At that stage the tax man was a preferential creditor, but even he was not getting anything near what he was due.

In fact, bearing in mind the length of the liquidation (and subject to looking at the liquidator’s income and expenditure accounts) I suspect the tax man got back little or nothing. The cost of a liquidation running nearly 7 years would be enormous normally.

On the information available therefore the issues seem to be (a) was the Declaration of Insolvency filled in falsely and (b) why were the bills receivable in the books so far above what the liquidator thought could be recovered.

One wonders too how a cleaning business based in Glasgow came to be owed £40,000 by a company based in Essex. Could there have been an issue here which brought the attention of the Insolvency Service to bear?

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To bring matters up to speed, I now have a copy of the Declaration of Solvency (thanks BillyBhoy68!)

You can see it here – VitalDeclaration.

It is completed only by the same Mr Anderson who signed the Special Resolution.

Page 3 of the form lists the Company’s assets and liabilities. Interestingly, though I am sure just a clerical error, the declaration states that a statement of affairs up to 31st August, being the latest date practicable, is attached. The statement of affairs is dated 23rd October.

The Company seems to have had little variety of material available to it. The only asset listed is £649,139 of “Bills Receivable”. There are no other assets of any kind listed. This perhaps is what Registrar Simmonds is referring to when he talks about assets being pout out of reach. The only liabilities disclosed are Bills Payable of £56,266 and “Other Liabilities” of £537,503, leaving a surplus of £55,410.

As I detailed above, the recovery from the surprisingly precise figure of “Bills Receivable” was far less, and, according to the BBC, involved the liquidator pursuing “Pelcroft”, stated to be another of Mr Whyte’s companies. (Which is the subject of my next post).

We shall see what the BBC has to add to this – the judgment of the Court sounds damning, ironically as Rangers and Mr Whyte await decisions from the Tax Tribunal and from Sheriff Ross in the Tixway case.

The story has a long way to go before it ends, I feel.

 

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Filed under BBC, Craig Whyte's Companies, Football, Insolvency, One Stop Roofing Supplies Ltd v Tixway UK Ltd, Rangers, The Company Directors Disqualification Act 1986.