Full details from the High Court - For all Q&A attendees

[Smudger]

With thanks to Shrimpacus on the "Stadium" forum.....

Fw: HIGH COURT COPY FROM UK LAW NEWS​

League One side Southend United were today given one final chance to pay debts of more than £400,000 to the taxman - all thanks to supermarket giants Sainsbury's.

Mrs Registrar Derrett adjourned the winding up moves brought against the club by Her Majesty's Revenue and Customs for 35 days to give it time to settle their debts of ££410,000, after hearing that a new stadium and retail development with Sainsbury's is set to come to fruition after years of planning.

Counsel Matthew Smith for HMRC had argued that the club should be wound up today, arguing that it was a "habitual defaulter" which is "plainly insolvent".
He said that the club had failed to take the steps it promised at the previous hearing a month ago, and had now failed to pay an additional £183,000 in VAT and PAYE on top of the original £228,000 debt.
He added that the local press had reported that staff had not been paid.
However, counsel for the club - who declined to give her name - said that Southend was a football club that "actually has proper plans for recapitalisation". She said that the club's problems had been caused by the "banking crisis", which had delayed the new stadium and retail development deal with Sainsbury's.

However, she said that it has now secured all necessary planning permissions from the Government, and should enable the club to pay all its debts within 28 days.

She said that there is £60,000 in the club's solicitor's account for immediate payment to the taxman, and that a sponsor is providing a further £170,000 on 31 March. She added that the club is also entering a period of high seasonal turnover, from mid-March to May, at which time £800,000 to £1million is brought in by season ticket sales for next season.

She said: "This isn't like the usual football club, where we are waiting for third party to come in as white knight."
She said that the deal had enabled the club to pay £2.1million last November, and would benefit both the club and the taxman in the long term, and added that staff are set to be paid on Monday.
"It is just beginning to see light at the end of the tunnel," she said.

Granting the adjournment, the Registrar said that the only thing making her hesitate about winding the club up was the development, "which looks like it has gone some way down the road".

She said: "What isn't clear to me is whether there is a real prospect of that providing sufficient means to properly refinance this company.
"But I will adjourn for 35 days. That is a final adjournment for settlement in full."

 

[Hotman]

Interesting.

I hope he is asked why moneys were paid to solicitors for forwarding to HMRC, and arrangements made for sponsors to pay further liabilities, whilst he was saying that it was a HMRC error??

And for all the fluff about taking it to Tribunal, certainly when I've lodged tribunal forms against HMRC an assessment was raised but no collection takes place, and certainly not winding up petitions, until the resolution of the tribunal (although this was under the old system, superseded about a year ago, the mechanism might have changed but I doubt it)

 

[Somerset Ex-TTB]

So thats the trust £60k, next years sponsorship and a quarter of next years season ticket money (not to mention the "World Cup" season ticket money) all being spent on historic and current debts.

How are we going to build a squad in the summer when Macca, Francis, Mildy, Moussa, JFC and Grant all ask for moves to clubs that pay their players, when all the cash has been spent?

 

[seany t]

Good God.

Yeah, if that's right we really are ****ed aren't we?

 

[Beefy]

So thats the trust £60k, next years sponsorship and a quarter of next years season ticket money (not to mention the "World Cup" season ticket money) all being spent on historic and current debts.

How are we going to build a squad in the summer when Macca, Francis, Mildy, Moussa, JFC and Grant all ask for moves to clubs that pay their players, when all the cash has been spent?

If work has started at Roots Hall and Fossetts Farm then chances are we'll have some additional revenue thrown our way to help build some sort of squad for next season (we'll be a far more viable entity to invest in once a single brick has been laid).

If work hasn't started then our cashflow problems next season will make anything we've seen this one look like a minor irritation.

 

[Beefy]

Good God.

Yeah, if that's right we really are ****ed aren't we?

There's nothing there that we didn't know. I wouldn't put too much stock in the words of a Magistrate. The are just a normal person practically off the street. One of my mates was one for a couple of years, and I wouldn't consider him particularly learned.

 

[seany t]

There's nothing there that we didn't know. I wouldn't put too much stock in the words of a Magistrate. The are just a normal person practically off the street. One of my mates was one for a couple of years, and I wouldn't consider him particularly learned.

It was a bit new to me in places, but that's because I spend most of my time on here sticking my fingers in my ears and patronisingly posting on threads about 3DTV and obscure American dramas. Hearing this bit from someone in the room as opposed to an Echo back page splash worried me:

"Counsel Matthew Smith for HMRC had argued that the club should be wound up today, arguing that it was a "habitual defaulter" which is "plainly insolvent". He said that the club had failed to take the steps it promised at the previous hearing a month ago, and had now failed to pay an additional £183,000 in VAT and PAYE on top of the original £228,000 debt"

But hey... time will tell!

 

[Smudger]

There's nothing there that we didn't know. I wouldn't put too much stock in the words of a Magistrate. The are just a normal person practically off the street. One of my mates was one for a couple of years, and I wouldn't consider him particularly learned.

From what I can see here, a Registrar in the High Court has a lot more power than a magistrate.

Judicial profile

 

[Beefy]

Yeah I think I've got my Magistrates and my Registrars mixed up. I blame a post-Paddys Day hangover.

 

[Yorkshire Blue]

It was a bit new to me in places, but that's because I spend most of my time on here sticking my fingers in my ears and patronisingly posting on threads about 3DTV and obscure American dramas. Hearing this bit from someone in the room as opposed to an Echo back page splash worried me:

"Counsel Matthew Smith for HMRC had argued that the club should be wound up today, arguing that it was a "habitual defaulter" which is "plainly insolvent". He said that the club had failed to take the steps it promised at the previous hearing a month ago, and had now failed to pay an additional £183,000 in VAT and PAYE on top of the original £228,000 debt"

But hey... time will tell!

That's what HMRC are claiming and they are always going to paint the worst possible picture. The club's solicitors however will paint a completely different picture which listening in court you probably wouldn't recognise that they were talking about the same case. As ever, the truth is somewhere in between. You really need to look at both sides.

Or you could just distort a quotation from the registrar as many prefer to do.....

 

[Benfleet Blue]

That's what HMRC are claiming and they are always going to paint the worst possible picture. The club's solicitors however will paint a completely different picture which listening in court you probably wouldn't recognise that they were talking about the same case. As ever, the truth is somewhere in between. You really need to look at both sides.

Or you could just distort a quotation from the registrar as many prefer to do.....

But didn't RM state that an officer from HMRC visits monthly to assess liabilities.

I don't think that HMRC would be quoting figures if they weren't fully aware of the extent of the debt. With computerised records they should know the liability to the penny.

 

[Lancashire shrimper]

This is an interesting read on the High Court action too;

http://www.twohundredpercent.net/?p=4796

" . . . In Martin’s latest “statement” on the club web-site, he opined: “I have read three news reports upon (sic) yesterday’s ten minutes in court and from what I have read, I must have been in a different place.” As unintended ironies go, that’s the best yet. On planet Earth, meanwhile, Southend were . . . "

 

[Yorkshire Blue]

This is an interesting read on the High Court action too;

http://www.twohundredpercent.net/?p=4796

" . . . In Martin’s latest “statement” on the club web-site, he opined: “I have read three news reports upon (sic) yesterday’s ten minutes in court and from what I have read, I must have been in a different place.” As unintended ironies go, that’s the best yet. On planet Earth, meanwhile, Southend were . . . "

That's a strange read. He seems to want football clubs to be treated like any other businesses, then when football clubs are treated like any other business and given every opportunity to pay up, he gets all upset and rails against it.

I think it's quite sad that he wants clubs to fail.