Tag Archives: Sheriff Ross

Remember One Stop v Tixway UK Ltd – Mr Whyte Has Appealed against the Judgement!

We have seen the release by Duff & Phelps of their comprehensive report regarding Rangers. I suspect that the detail therein is far more than many expected, even if it raises a great deal of questions about the previous involvement of MCR with Rangers/Mr Whyte/Liberty Capital etc.

It also details, in stark terms, the effects on businesses, many being small traders, of Rangers’ financial mismanagement. Whilst the big creditors, like Ticketus and HMRC get the most publicity, there are many smaller creditors to whom the unpaid sums, and the prospect of a “pennies in the pound” CVA will cause problems.

For example, the Copland Road newsagent owed over £500 won’t, one hopes, go bust for that, but that is a decent chunk of income lost.

Many of these creditors will have been dealing with Rangers in good faith, and taking the general information from the media, would have had few concerns. And anyway, they might have thought, it is Rangers we are dealing with here!

All of which brings us back to Mr Whyte and Tixway UK Ltd.

I have written about this case before here and here.

£89,127.18 is the sum owed to One Stop. That, for any business, is a lot of money, especially as this has been due since 2008. It is the sort of debt which can affect the stability of a business, and the jobs of those employed there.

You may recall that Mr Whyte’s evidence was shredded by Mr Clark QC for One Stop, and Sheriff Ross found against the company owned by the “wholly unreliable” witness, Mr Whyte. Continue reading

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Filed under Civil Law, Craig Whyte's Companies, One Stop Roofing Supplies Ltd v Tixway UK Ltd

The Longer Rangers Hang On, the More Chance Craig Whyte Has to Give Evidence Again!

Craig Whyte will be smarting from the verdict of Sheriff Ross in the Tixway UK case.

His evidence was found to be “wholly unreliable”. The Sheriff was, in a polite way, scathing about Mr Whyte’s manner of giving evidence.

Following that, one would expect him to be reluctant to venture near a court again.

To be fair though he has managed to keep Rangers operating past various dates when many assumed, and some hoped, the shutters would come down. With every successful hurdle crossed, he comes closer to what might be a Becher’s Brook for him.

When Martin Bain’s case was set down for proof in July, few neutral observers would have thought it likely that there would be a Rangers to defend it.

However, July is getting closer.

This poses a dilemma for Mr Whyte and his legal advisers. Whilst Mr Whyte could settle the claim brought by Donald McIntyre despite public comment about the cheek of him pursuing the claim at all, different considerations apply regarding Mr Bain.

Many Rangers supporters blame him, along with Sir David Murray, for the financial mess inherited by Whyte.

Whyte’s refusal to surrender to Mr Bain brought him praise and support from much of the fan base. However, how would fans who still had confidence in him react if he settled with Mr Bain? For many that might prove to be the last straw.

I would imagine that Rangers’ lawyers would want Mr Whyte as far from court as possible, whilst Mr Whyte has rarely shown a desire to shirk a fight. I suspect counsel for Mr Bain would view Whyte in the box as a hunter views a defenceless fawn, or even a succulent lamb!

Bearing in mind previous speculation that Messrs Murray, McClelland and Johnston were lined up to support Bain, the case would be well worth watching!

However, even if Rangers do suffer an Insolvency Event, this does not guarantee that the case will be prevented from going ahead. After all, they are pursuing a substantial counterclaim. Therefore, depending on the legal advice to any liquidator, receiver or administrator, the company might still, in the end, go ahead with the action to recover the counterclaimed funds.

How effective would Mr Whyte be in a case where he had no incentive and where the only benefit would be for creditors?

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Filed under Bain v Rangers, Civil Law, Football, Insolvency, Rangers

Craig Whyte – “Wholly Unreliable” – Tixway UK Loses One Stop Case

The BBC has reported the outcome of the One Stop Roofing v Tixway UK Ltd case.

Mr Whyte has been unsuccessful and his company Tixway UK Ltd has been ordered to pay One Stop Roofing the full sums claimed. A later hearing will assess who pays the costs of the case, but these will probably be awarded in their entirety against Tixway UK Ltd.

In a case where credibility of witnesses was to be the deciding factor, it appears that Sheriff Ross has been left in no doubt as to the position.

“I accept the evidence led by the pursuer (One Stop Roofing) as credible and reliable, and supported by the available documentation.

“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.”

The Sheriff went on to say that Mr Whyte’s firm Tixway had “offered its own credit rating to allow cover for the supply of large volumes of materials to Snowcast”.

He said this was “subject to a high degree of control by the defender over Snowcast and an understanding between the defender (Tixway) and Snowcast that Snowcast would make payment for those materials”.

Sheriff Ross concluded: “As a matter of legal liability, however, the defender remains the principal obligant.

“There is no dispute as to the sum outstanding, nor that it was properly incurred, and I accept the total brought out by the pursuer’s figures.”

The problem of course for Tixway UK is that Snowcast is in liquidation.

The Sheriff’s judgment could not really be more damning and must be of concern both to Rangers supporters and to the wider Scottish football community.

The SFA investigation into whether or not Mr Whyte is a “fit and proper person” to be involved in running a football club is continuing.

The only silver lining for him is that, if you squint hard enough at the decision, he will not, despite what the BBC suggested, be investigated for any alleged perjury.

However, that is on the basis that either (a) he was telling lies or (b) he had convinced himself that a version of events found not to be true was in fact true.

Sich a finding is probably even more damaging for his overall credibility than one which condemned him as an out and out liar.

As far as judgments go, this is akin to condemning Mr Whyte as a fantasist or Walter Mitty character.

Many wondered why a hugely successful businessman, with such a high profile, would risk his reputation in court like this over the comparatively small matter of £90,000.

If he had convinced himself that his alternate reality was true then that might explain it, but bearing in mind the comments from his spokesman whan the action was raised, namely that all the bills had been paid, this suggests that Mr Whyte’s alternative reality changed as the case continued.

His company can still appeal. However, Tixway UK would need to show that Sheriff Ross made a decision no reasonable Sheriff would have as regards credibility. Sheriff Ross is an excellent judge, and I have no doubt that his decision will be legally watertight.

There is not going to be a successful appeal in this case.

Will Mr Whyte come out all guns blazing looking to rally his dwindling band of supporters round him?

Or will this decision rip from him the final shreds of credibility he might have retained.

 

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Filed under BBC, Civil Law, Courts, Craig Whyte's Companies, Football, One Stop Roofing Supplies Ltd v Tixway UK Ltd, Rangers

Part 2a of the Craig Whyte + Rangers Catch Up – The Tixway Case and Why Hide His “Phoenix From the Flames” Story?

 

Yesterday I posted my roundup of the Rangers Football Club PLC and Rangers FC Group Ltd court actions. Helpfully there were rather more interesting developments in the Bain v Rangers case than I had expected. I will do an “add on” post to take account of what happened. However, it seems to me that there is not an imminent settlement on the way in that case. Paulie Walnuts (which I suspect might not be his real name), a commenter on the Rangers Tax Case Blog, has analysed yesterday’s events already. I intend shamelessly to purloin his thoughts, add a bit on, and put it up later on.

 

Now, as the Swedish DJ used to say on Radioactive, “On wit de music” (Joke inserted for fans of 1980’s Radio 4 comedy programmes – if there are any others out there!)

 

Mr Whyte is involved in various cases, or has threatened to take such action. I wanted to have a quick run through where matters stand, at present. As before, I am happy to be corrected should I be wrong in any of the analysis or deductions, or should my source materials turn out to be incorrect.

 

One Stop Roofing Supplies v Tixway UK Ltd

I will deal with this first as it is due to continue in Glasgow Sheriff Court tomorrow (19th January) before Sheriff Ross.

This is the debt action brought by a building supplies company against a company owned by Mr Whyte and in which he is now the sole director.

When the company was formed, Mr Whyte was still serving his ban from being a company director. Therefore the company’s original director was Mrs Whyte (more of whom below). On the expiry of the disqualification, Mr Whyte took up the director’s role, and Mrs Whyte resigned.

Suspicious people have wondered if, in fact, Mr Whyte was acting as a “shadow director” at this time, as his wife seems to have far less business experience than her husband does. However, there has been no evidence of such activity made public, and therefore we must assume that no such evidence exists. In that case allegations of acting in respect of this company as a “shadow director” would be unfair and unfounded, and for the avoidance of doubt, I make no such allegation.

This action, at first sight, seemed to be a straightforward payment action. The Pursuer, a company run by Albion Rovers manager Paul Martin, sued for just under £100,000. Building supplies had been provided, some of which were used to renovate the roof of Mr Whyte’s property, Castle Grant, and not paid for.

However as the court action progressed, it became clear there was more to it. One Stop alleged that they had supplied materials to Snowcast, a company involved in the work on Mr Whyte’s castle.

That company is now in liquidation.

One Stop claims that Tixway owned 51% of Snowcast, and that Mr Whyte had agreed to pay for these materials. Mr Whyte denies this.

One Stop say that hundreds of invoices were sent to Tixway, but it is Mr Whyte’s position that these were all wrongly sent, and should have gone to Snowcast.

When giving evidence when the case last called, Mr Whyte was examined by One Stop’s QC.

From the report in the Daily Record law reports:-

“In a terse exchange with Alistair Clark QC, acting for One Stop Roofing, [Whyte] denied ever saying that the bills were due to be settled by Tixway.

Mr Clark put it to Whyte that he had received text messages and emails from Jenkins about the outstanding debt and a plan to pay it off at £5000 a month.

But Whyte said he had never accepted it was a Tixway debt and that since he was owed money by Snowcast as well, it was in both their interests to discuss Snowcast debts.

Whyte is sole director of Tixway but until April 1, 2008, the only director was his wife Kim.

Mr Clark asked if this was because Whyte had been banned from being a director until that point.

Whyte said: That is a matter of public record. Mr Clark said: Was the ban for trading while insolvent? Whyte said: I don’t have a recollection of why I was banned without legal documents. I am not going to say in open court and get it wrong.

Whyte told Sheriff Nigel Ross the case was an attempt to embarrass him. He said of Martin and Jenkins: They thought I would settle to avoid the publicity of coming here today and that’s why were here. They have attempted to do that already. They went to the press several months ago.”

I have highlighted the part of the exchange which is most important in the wider story of Rangers and Mr Whyte’s involvement with them.

He has been slow to volunteer information he later has acknowledged ought to have been provided, such as his director disqualification. Concessions and settlements seem to have to be dragged out of him. That, in itself, is not necessarily wrong. There is no requirement for a person taking up a position in a public company to subject himself to a “This Is Your Life” analysis, unless the points raised are relevant.

Concerning Mr Whyte there are, I submit, various relevant matters, such as his history as a director, allegations regarding his actions whilst disqualified, and questions as to the source of the “Billionaire’s” funds.

Interestingly, for a man who has threatened litigation previously over “inaccurate” reporting, I am unaware of him seeking an apology or correction for the references to him as a “Billionaire” when he first came on the scene.

Here, under oath, Mr Whyte told the court that he could not recall, without seeing the papers, why he received a 7-year ban in the year 2000.

Previously however, he has been aware of it, suggesting that this arose from “technicalities”.

As I wrote previously, it must be a big “technicality” to get a 7-year ban!

The danger for Mr Whyte is, having said he cannot respond without paperwork in front of him, that he stands up in the witness box tomorrow, or is recalled to give evidence, at which time Mr Clark presents him with the paperwork, and asks him to confirm the reasons!

The records are public, in that they arose from court proceedings. One Stop would be entitled to have obtained them to put them to Mr Whyte.

In my own experience, I have seen many people be caught out by trying to be clever in answering questions in court. Things that one can say in press interviews, for example, and get away with, are not allowed in court.

When interviewed in October by Tom English, for Scotland on Sunday, there was this exchange.

“Question – Let’s look at this closely. They said you were disqualified as a company director. Is that true?

Answer – I’m not comfortable getting into the specific allegations.

Question – They had a government official – Robert Burns, head of investigations at the Insolvency Service – saying that you could, potentially, have faced a two-year jail sentence for your involvement in a company, Re-tex Plastic Technology while disqualified. Is that true?

Answer – I’m not going to comment on specific allegations other than to say on the basis of what I’ve heard the Insolvency Service said last night, I’m looking into the possibility of suing them personally.”

I suspect that Mr Whyte would not be permitted to repeat those answers in the court, or of he did, he would be politely reminded by Sheriff Ross, who is an excellent judge, that he had to respond properly.

 

A Digression – Rags to Riches to Rags to Riches

Mr Whyte appears to be a remarkably modest man.

HE did not come, despite my heading above, from “rags”. His father was, and remains, a businessman in the Motherwell area. As Mr Whyte disclosed previously however, he started to make money by investing whilst at school. This allowed him to build a fortune on leaving school which he used immediately to get started investing in businesses.

By the late 1990’s, he had received glowing profiles in the press, and all for a man who was not yet 30, or not yet 28, depending on which date was on the Companies House records. He had many and varied business interests.

However, he over-reached himself and he was too successful, so the story goes. His companies collapsed. (He was a director of around 15 companies over that period, none of which remains active today.)

He was disqualified by the Court from being a Company Director in the UK for 7 years.

He left the country and travelled to Monaco, where he spent the next few years, until his return to Scotland in 2006, re-building his fortune.

When he came back, still a disqualified director, he was able to buy Castle Grant, a very famous and no doubt very expensive property in Grantown on Spey.

These business interests gave him access to funds to allow him to step up, when no one else had been willing to do so, and buy Rangers Football Club from Sir David Murray.

With this came far more scrutiny than the “under the radar” businessman had ever expected.

However, surely this is an inspiring story. Like many successful business people, Mr Whyte had taken his knocks, and yet bounced back better than ever. I recall a statistic that a large percentage, for example, of American millionaires had first been through bankruptcy (there is no suggestion Mr Whyte has ever been bankrupt.)

Surely Mr Whyte would be willing to share his experiences and insights, to inspire a further generation of entrepreneurs to help fire up the British economy.

In the same interview with Tom English, he was given the chance to share these insights with the public.

“Question – There is an air of mystery about you, though. Nobody really knows much about you – where you got your money from and how much you have.

Answer – Good.

Question – So where did you make your money and how much do you have?

Answer – If I asked you how much money you have, you would be within your rights to tell me to f*** off, it’s none of my business. All that matters is that I’m delivering on what I said I would deliver on. Rangers are in a better place now than they have been in the last three or four years. That’s what’s important. As long as I deliver on what I said I would deliver on what difference does it make?

Question – What other businesses do you have, we know nothing of this?

Answer – I’ve got more than 20 other businesses in the UK and across various parts of Europe and I’m involved in all sorts of things. I’m a prolific deal-maker, but the only one you get to hear about is Rangers. I’m doing deals constantly. This morning I’m working on a decent size deal with a fairly well-known business but it will never get any attention.

Question – Why not?

Answer – Because I don’t want it to.

Question – Again, why not?

Answer – Why should I? I’m stubborn.

Question – Give us the names of a few of your companies that you’re really proud of?

Answer – No. Good effort but I’m not going to name the companies because that’ll create a level of scrutiny for them and I don’t want to have that. I just want them to get on with business. Look, I can’t complain about it because I put myself in the position. David Murray told me what it would be like. I’m fortunate to be in the position I’m in. You know my thoughts, I’m not a publicity hungry type of guy. This stuff doesn’t sit naturally with me. I’m only doing this now because of that BBC thing.”

I think it is fair to say that Mr Whyte is reluctant to share the secret of his success with the world, and even to confirm which other companies he owns or is involved in.

Interestingly, Companies House records suggest he is presently a director of around 10 companies just now. One wonders in what capacity he has “got more than 20 other businesses in the UK and across various parts of Europe.”

A telling line too, I think, is “I’m not going to name the companies because that’ll create a level of scrutiny for them and I don’t want to have that.”

It appears that he would like the same standard of lack of scrutiny applied to Rangers as well!

Most prominent and successful businessmen are happy to share their secrets: Trump, Sugar, Branson, and Harvey-Jones. And the ones who are reluctant to are generally less robust in their rejection of such questions than Mr Whyte.

Perhaps, once the Rangers adventure is over and Mr Whyte again has time on his hands, he can write a best seller telling people how to do what he has already done?

 

Back to the Case

Unless the case settles by tomorrow, which is possible, it will move towards a conclusion. It is unlikely that a decision will be produced tomorrow. Sheriff Ross will consider the evidence and produce a judgment dealing with the facts and his legal findings.

Of course judgments are public documents, and often published on the invaluable Scottish Courts website.

A finding in favour of Mr Whyte would be a great victory for him, vindicating him against many of his critics.

However, should the Sheriff find that he was not a credible witness, even if the case is won by Tixway on legal grounds, then this would allow the media to refer to the decision constantly.

In a different context, Jeffery Archer and Jonathan Aitken are regularly described as “convicted perjurers” which they are, even in articles to which the convictions have no bearing at all.

Mr Whyte has staked a great deal on the Sheriff finding that he is truthful. As well as being in the hands of the Tax Tribunal, he will be in the hands of Sheriff Ross.

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Filed under Craig Whyte's Companies, Football, One Stop Roofing Supplies Ltd v Tixway UK Ltd, Rangers