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Bury FC Courtcase

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Re: Bury FC Courtcase

Postby Marky Mark » Wed Jun 26, 2019 8:38 am

part time pete wrote:CVA’s need 75% approval to be allowed. Number of votes depends on the amount of debt for each individual or organisation. HMRC now have a policy to vote against any CVA’s unless they repay 100p in the pound. So if the HMRC debt is more than 25% of the total debt then there is no chance of the CVA getting through.

However a good way around this is to inflate the debt owed to certain individuals.

A good way unless you get caught fiddling the books.

That’s why the administrators need to be totally independent but they really are.


He owns 52% of the debt himself so he just needs another 23% for it to pass. Looks like a moving around of cash, he'll get £900k back from the 25% for the non-football creditors with which he'll pay the 100% to the football creditors and then be left with a football club with no debt to work on recouping the rest. Haslam-esque, without the cash.
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Re: Bury FC Courtcase

Postby NorthLondonStag » Wed Jun 26, 2019 12:36 pm

That's not quite correct. There are two tests:

(1) 75% + of those that vote (referred to above). So if he has 52% of the votes and nobody else votes then it goes through. He only needs the other 23% if the other 25% all choose to vote against.

For example if there are a total of £10m of claims, but only £5m bother to vote then the proposal is approved if more than £3.75m of that £5m vote in favour (ie 75% + of those voting).

(2) There is then a separate test which deals with 'connected' creditors forcing through the vote. This test says that the CVA fails if 50%+ of all of the 'unconnected' creditors vote against (and whether they vote or not).

So if (say) there were £10m of debts and £7m are 'connected' then if more than half of the £3m 'unconnected' votes vote against then the CVA fails, even IF the 75% majority is also achieved.

The purpose of the second rule is to try and stop connected creditors forcing through CVA against the wishes of a 50% majority of unconnected creditors.

HMRC do not have an official policy of voting against CVAs. However they have a long history with football clubs, because (i) they have never liked the rule that football creditors get preference (they tried to challenge this in Court, but lost); and (ii) clubs have often delayed in paying their PAYE and NI, for cashflow reasons. A lot of football insolvencies are triggered by HMRC applying to court for a winding-up order for unpaid taxes.
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Re: Bury FC Courtcase

Postby yorkshire stag » Wed Jun 26, 2019 12:54 pm

TBH i don’t really care what happens to them now, it’s not gonna effect or impact on us
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Re: Bury FC Courtcase

Postby Marky Mark » Wed Jun 26, 2019 1:01 pm

NorthLondonStag wrote:That's not quite correct. There are two tests:

(1) 75% + of those that vote (referred to above). So if he has 52% of the votes and nobody else votes then it goes through. He only needs the other 23% if the other 25% all choose to vote against.

For example if there are a total of £10m of claims, but only £5m bother to vote then the proposal is approved if more than £3.75m of that £5m vote in favour (ie 75% + of those voting).

(2) There is then a separate test which deals with 'connected' creditors forcing through the vote. This test says that the CVA fails if 50%+ of all of the 'unconnected' creditors vote against (and whether they vote or not).

So if (say) there were £10m of debts and £7m are 'connected' then if more than half of the £3m 'unconnected' votes vote against then the CVA fails, even IF the 75% majority is also achieved.

The purpose of the second rule is to try and stop connected creditors forcing through CVA against the wishes of a 50% majority of unconnected creditors.

HMRC do not have an official policy of voting against CVAs. However they have a long history with football clubs, because (i) they have never liked the rule that football creditors get preference (they tried to challenge this in Court, but lost); and (ii) clubs have often delayed in paying their PAYE and NI, for cashflow reasons. A lot of football insolvencies are triggered by HMRC applying to court for a winding-up order for unpaid taxes.


Great knowledge...far better than my assumption based way of operating. Thanks

So unconnected creditors are worth £3.4m, and with HMRC being owed £1m, then it follows (hopefully) that if another £700k of the £2.4m remaining creditors vote against/don't vote then it will get rejected?
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Re: Bury FC Courtcase

Postby NorthLondonStag » Wed Jun 26, 2019 2:08 pm

Marky Mark wrote:
NorthLondonStag wrote:That's not quite correct. There are two tests:

(1) 75% + of those that vote (referred to above). So if he has 52% of the votes and nobody else votes then it goes through. He only needs the other 23% if the other 25% all choose to vote against.

For example if there are a total of £10m of claims, but only £5m bother to vote then the proposal is approved if more than £3.75m of that £5m vote in favour (ie 75% + of those voting).

(2) There is then a separate test which deals with 'connected' creditors forcing through the vote. This test says that the CVA fails if 50%+ of all of the 'unconnected' creditors vote against (and whether they vote or not).

So if (say) there were £10m of debts and £7m are 'connected' then if more than half of the £3m 'unconnected' votes vote against then the CVA fails, even IF the 75% majority is also achieved.

The purpose of the second rule is to try and stop connected creditors forcing through CVA against the wishes of a 50% majority of unconnected creditors.

HMRC do not have an official policy of voting against CVAs. However they have a long history with football clubs, because (i) they have never liked the rule that football creditors get preference (they tried to challenge this in Court, but lost); and (ii) clubs have often delayed in paying their PAYE and NI, for cashflow reasons. A lot of football insolvencies are triggered by HMRC applying to court for a winding-up order for unpaid taxes.


Great knowledge...far better than my assumption based way of operating. Thanks

So unconnected creditors are worth £3.4m, and with HMRC being owed £1m, then it follows (hopefully) that if another £700k of the £2.4m remaining creditors vote against/don't vote then it will get rejected?


In principle you are correct, but it may not pan out like that for the following reasons:

(1) the football creditors are likely to get a vote, even though they are getting paid in full [this is an oddity in the legislation - all creditors of the company get to vote, even if they are not being compromised]. As they are being paid in full then why would they vote against?

(2) HMRC may not vote against. They could vote for or abstain (ie not vote at all).

(3) Of the remainder, if they are being offered 25p/£ then they would normally only choose to vote against if the insolvency outcome is better (or they want to see the club out of business for some other reason). And remember some will be ongoing suppliers who want the club to continue so that they can get future business.

The full insolvency comparison is normally contained in the CVA proposal and will usually demonstrate that the insolvency outcome is (much) worse for creditors than the projected CVA outcome.

In football that's often because (a) football clubs in financial difficulties have usually sold (and leased back) or mortgaged their grounds (and have next to no other physical assets - they are unlikely to have any cash and the football league registration is mentioned below) and (b) the main point - you can't sell the football league registration to a new company, so you can't do an insolvency of the company and sell the registration to a new company. The registration must remain in the existing company.

A football club without an EFL registration can't play in the EFL, and therefore in practice the only way you can therefore keep going in the EFL is through doing a CVA. And to do that you have to pay your football creditors in full, as that's also an EFL rule. [If there is a full insolvency process and the assets are sold to a new company (say, owned by the fans) then the 'new' club can't then compete in the EFL. They have to start over again at a much lower level (league's discretion, but at least 3 leagues below, as I understand it)].

So the offer is normally to pay the football creditors in full (from a third party, to avoid legal issues which are too tedious to explain) and offer a decent amount to the unsecured creditors, which is significantly better than in an insolvency.

So if you are looking at this as an external creditor then you might be thinking that you can get 25p/£ out fo the CVA or much less in a formal insolvency. You might dislike the football club for what they have done but you may also prefer £25k for your £100k claim than next to nothing.

Finally, the 25p/£ probably also comes from the EFL Rules. As far as I'm aware these prescribe that on any CVA the unsecured creditors must be paid a minimum of 25p/£ in one go or 35p/£ over a three year period. I think this was done to prevent clubs offering derisory sums to creditors, which were minimal but better than the insolvency outcome.
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Re: Bury FC Courtcase

Postby NorthLondonStag » Wed Jun 26, 2019 2:26 pm

"So unconnected creditors are worth £3.4m, and with HMRC being owed £1m, then it follows (hopefully) that if another £700k of the £2.4m remaining creditors vote against/don't vote then it will get rejected?"

PS - the "don't vote bit doesn't work'. At least 50% of the unconnected creditors must VOTE against.
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Re: Bury FC Courtcase

Postby Gruff » Wed Jun 26, 2019 3:10 pm

and if it is accepted or rejected Notts County will still be non-League with Chesterfield
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Re: Bury FC Courtcase

Postby Tippy Tappy Football » Fri Jul 12, 2019 3:35 pm

HMRC voted to turn down the CVA. The creditors' meeting has now been adjourned until 18th July for further negotiations. The supporters trust is now pushing for the club to be put into administration so it can be sold.

One of Stewart Day's companies is seeking repayment of £8 million for an unsecured loan. Steve Dale is only owed £3.6 million as he took over loans from Stewart Day. They were probably transferred to him for nothing. Total debt could be as high as £16 million.

Gigg Lane is valued at less than secured loan on it.

Bury's remaining 7 contracted players have been told they can leave for free.

.....and the EFL now amazingly announce that they never approved the takeover of Bury in December.

Time for an Independent Football Regulator.

https://www.theguardian.com/football/20 ... mbargo-efl

https://www.dailymail.co.uk/sport/footb ... leave.html

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Re: Bury FC Courtcase

Postby Sneag » Fri Jul 12, 2019 4:06 pm

Sympathy for the real fans and all that old raspberrys but what about the fans of team(s) who missed out on promotion due to Bury playing with money they didn't have.
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Re: Bury FC Courtcase

Postby Captain Cunno » Fri Jul 12, 2019 4:22 pm

No sympathy whatsoever.
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Re: Bury FC Courtcase

Postby Amber Andy » Fri Jul 12, 2019 4:26 pm

Sneag wrote:Sympathy for the real fans and all that old raspberrys but what about the fans of team(s) who missed out on promotion due to Bury playing with money they didn't have.
I agree.
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Re: Bury FC Courtcase

Postby ST4GS » Fri Jul 12, 2019 4:29 pm

Sneag wrote:Sympathy for the real fans and all that old raspberrys but what about the fans of team(s) who missed out on promotion due to Bury playing with money they didn't have.

Whoever finished 8th must be spitting blood as they missed an opportunity to compete in the play-offs.
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Re: Bury FC Courtcase

Postby Tippy Tappy Football » Fri Jul 12, 2019 4:31 pm

Someone at Bury still has a dark sense of humour as they tweeted this yesterday

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Re: Bury FC Courtcase

Postby Sneag » Fri Jul 12, 2019 4:56 pm

ST4GS wrote:
Sneag wrote:Sympathy for the real fans and all that old raspberrys but what about the fans of team(s) who missed out on promotion due to Bury playing with money they didn't have.

Whoever finished 8th must be spitting blood as they missed an opportunity to compete in the play-offs.


And the team finishing 23 may have finished 22nd. So every cloud has a silver lining. :lol:
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Re: Bury FC Courtcase

Postby cassellswasmagic » Fri Jul 12, 2019 5:03 pm

Sneag wrote:
ST4GS wrote:
Sneag wrote:Sympathy for the real fans and all that old raspberrys but what about the fans of team(s) who missed out on promotion due to Bury playing with money they didn't have.

Whoever finished 8th must be spitting blood as they missed an opportunity to compete in the play-offs.


And the team finishing 23 may have finished 22nd. So every cloud has a silver lining. :lol:

:lol: you devil.
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Re: Bury FC Courtcase

Postby Stags 2002 » Fri Jul 12, 2019 7:10 pm

Tippy Tappy Football wrote:Someone at Bury still has a dark sense of humour as they tweeted this yesterday



Its a parody account. ;)
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Re: Bury FC Courtcase

Postby Tippy Tappy Football » Sun Jul 14, 2019 11:54 am

Bury's team for the 1-1 draw at Nantwich yesterday

Byron Moore is still there. He would be a useful back up striker to bring on off the bench.

FIRST HALF TEAM
No 1, GK – Joe McDonnell – was released by AFC Wimbledon at the end of the 2018/19 season More info
No 2, RB – (unknown)
No 3, LB – Adam Chicksen – was released by Bradford at the end of the 2018/19 season More info
No 4, DM – Stephen Dawson
No 5, CB – Alex Bruce – played at Kilmarnock last season and has played at Bury a couple of seasons ago under Lee Clark More info
No 6, CB – (unknown)
No 7, AM – (unknown)
No 8, AM – Danny Rooney – was on loan at Truro City last season from Plymouth. More info
No 9, ST – Marko Mitrovic – won the 2010 FA Youth Cup with Chelsea & he scored. More info
No 10, RW – Chris Dagnall
No 11, LW – Byron Moore

SECOND HALF TEAM
No 21, GK – (unknown)
No 2, RB – (unknown)
No 3, LB – (unknown)
No 4, M – (unknown)
No 4, RM – (unknown)
No 11, ST – Jordan Archer
No 12 – (unknown)
No 14, LM – Harry Bunn
No 15, CM – Neil Danns
No 17, CB – Anthony Kay – has rejoined the Shakers on trial after leaving Port Vale at the end of last season.
No 18, CB – Tom Miller

SUB ON: No 9, ST (unknown) replaced Archer on 81 mins
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Re: Bury FC Courtcase

Postby SINA STAG » Sun Jul 14, 2019 1:10 pm

Why would you go n play for bury when they dont know when their next payday is coming

Beggars belief some players are totally thick or know more than the fans n creditors
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Re: Bury FC Courtcase

Postby Dan » Sun Jul 14, 2019 1:32 pm

They know that whatever happens they’ll get their money because if the club can’t pay them the PFA pay them instead.
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Re: Bury FC Courtcase

Postby I am Spartacus » Sun Jul 14, 2019 1:35 pm

And yet the silence from the EFL as a club spirals through owner after owner, deeper and deeper into debt and then into liquidation is deafening.

Still, all the ‘customers’ that pay for sky will be happy to know that the Premier League is awash with money.

The Fit and Proper person test is regularly failed by those appointed to the management boards of the FA, EFL and the Premier League. The so called custodians of OUR game.
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Re: Bury FC Courtcase

Postby Tippy Tappy Football » Sun Jul 14, 2019 2:14 pm

What is outrageous is that the EFL did not even approve the takeover of Bury in accordance with its rules. If I were JR I would be considering making a claim against the EFL for loss of income. It might be worth a few formal letters of complaint. You also have to wonder as to whether Bury were complying with the Salary Cost Management Protocol.
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Re: Bury FC Courtcase

Postby Chrisuknottm » Sun Jul 14, 2019 4:25 pm

I've posted previously that the EFL appears to be perpetually more interested in looking politically correct and pandering to every minority interest with trumpeted schemes that most of us don't give a toss about but when it comes to managing the well being of the leagues and clubs they disappear behind a wall of silence
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Re: Bury FC Courtcase

Postby Field Mill » Sun Jul 14, 2019 9:00 pm

Can anyone really see them fulfilling their fixtures? This is a major scandal in the making.
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Re: Bury FC Courtcase

Postby Spiritater » Mon Jul 15, 2019 8:32 am

we're league 2 cos our boys bottled it. not because anyone cheated
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Re: Bury FC Courtcase

Postby tillydog123 » Mon Jul 15, 2019 10:03 am

Fully agree Spiritater, only 1 point required and could not manage it with all the big wages and perks they had had all season.
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