Derby County

[Davefevs]

Pressure now on Quantuma.

From a footballing point of view, pressure on Rooney now too.  They’ve got themselves back in it, but sometimes that’s just the start, and there is probably some expectation they will get out of it.  Expectation they’ve not had all season.  They’ve been able to play with freedom / siege mentality.  That dynamic might’ve changed.

Its a bit like Blackburn, chased 2nd place for weeks and weeks, get there, then fail to win their last 3.

Would be funny if Mel causing this problem on the thinking of points deduction means relegation, and then Derby stay up!!  I do want them to go down…but if they garner enough points, then fair enough.

Football is unpredictable!

[BTRFTG]

24 minutes ago, Yellow&Blue&Red said:

If you threaten to sue me for... whatever. And a friend offers to pay you to go away and sign documents promising not to never sue me for that, then you may choose to sign those documents. The lack of a legal relationship between me and my friend is irrelevant.

Not quite. The agreement would be between you and I though consideration would be made by your friend. Should your friend fail to substantiate the contract through consideration then that would be relevant to you. It also assumes you've agreed for your friend to act on your behalf. Could be you don't think the settled sum is valid or fair, or the consideration you receive might incur difficulties for you down the line and therefore your friend should not have acted as they did. That's why such arrangements are odd, to say the least.

[PHILINFRANCE]

3 minutes ago, BTRFTG said:

If true, that somebody who has no authority within an entity has agreed a personal arrangement for another party to drop prospective action against that entity, then in reality there can't have been much hope of said action ever having been successful.

We'd love to see the wording of that arrangement....

Most likely, in my opinion, is that MM, who whilst no longer having any formal 'legal' authority to handle Derby's affairs, is in regular contact with both Derby and Quantuma and, most likely, has/had the means to make informal, direct contact with SG. and simply suggested, 'Look, Steve, How much do you (Middlesbrough) want to drop your claim?'.

Steve and MM have agreed on X, and Middlesbrough have/will withdraw their claim.

It just remains for Quantuma to draw up the appropriate legally binding agreement between Middlesbrough and Quantuma, MM being a simple intermediary and, of course, not party to said agreement.

    

[BTRFTG]

3 minutes ago, PHILINFRANCE said:

Most likely, in my opinion, is that MM, who whilst no longer having any formal 'legal' authority to handle Derby's affairs, is in regular contact with both Derby and Quantuma and, most likely, has/had the means to make informal, direct contact with SG. and simply suggested, 'Look, Steve, How much do you (Middlesbrough) want to drop your claim?'.

Steve and MM have agreed on X, and Middlesbrough have/will withdraw their claim.

It just remains for Quantuma to draw up the appropriate legally binding agreement between Middlesbrough and Quantuma, MM being a simple intermediary and, of course, not party to said agreement.

    

In practice that's probably what's happened but to push the point who else needs to agree/assure what are private arrangements between two member clubs? At minimum one assumes the EFL would have a governance role to ensure an agreement wouldn't compromise their rules or other members interests? It also questions why the detail couldn't be shared with the consideration being kept confidential?

[semblar]

11 minutes ago, BTRFTG said:

In practice that's probably what's happened but to push the point who else needs to agree/assure what are private arrangements between two member clubs? At minimum one assumes the EFL would have a governance role to ensure an agreement wouldn't compromise their rules or other members interests? It also questions why the detail couldn't be shared with the consideration being kept confidential?

I suppose that is my problem - it potentially opens so many loopholes where what is effectively a brown paper envelope can be passed from a private individual to a club and the "official" transaction between two clubs looks far better in terms of FFP than it would have if everything went through the books. I hope that those more knowledgeable than me on such matters can explain why not?

[ExiledAjax]

Seems broadly fine and eminently sensible to me. MM enters into an agreement with Boro. He pays money - or promises to pay, whatever - and Boro agree to withdraw the claim. The word 'accord' means nothing legally, so I imagine you dig out a settlement agreement precedent document and start with that. Derby County FC don't really need to be involved. Settlement agreements generally avoid saying that anyone admits any fault for anything, they basically say "it's cheaper and quicker to settle now than drag this through the courts, so let's just swap some money and promises and all go about our lives".

So far as the EFL are concerned, the matter is resolved when Boro withdraw their claim against Derby County. Do they really care how that comes about? Honestly I don't think so.

As an aside, I guess this might take some heat off of the fixture this weekend.

[lenred]

39 minutes ago, semblar said:

I suppose that is my problem - it potentially opens so many loopholes where what is effectively a brown paper envelope can be passed from a private individual to a club and the "official" transaction between two clubs looks far better in terms of FFP than it would have if everything went through the books. I hope that those more knowledgeable than me on such matters can explain why not?

You’ve far more eloquently put what my quandary is with it! 

[Mr Popodopolous]

2 hours ago, BTRFTG said:

Doesn't explain why Morris was even in the negotiation as he doesn't represent Derby County FC, or is the suggestion he's now accepting liability for debts through his beneficial stakes in the linked enterprise?

 

1 hour ago, lenred said:

But surely it sets further precedents for other interested Parties? 

This is interesting, because if I'm HMRC, existing Football Creditors but of course these don't need to be settled instantly as transfers paid in instalments, or of course existing Unsecured Creditors- he's at least open to settling with Gibson, I would guess a few million maybe but the rest of the actual existing debt, "Can't/won't pay".

Regarding MSD, there are differing stories or claims of a Personal Guarantee.

Also have to wonder where the Wycombe claim now stands- assuming no settlement has been reached, if they actually believe they have a case they should keep on.

Edited February 11, 2022 by Mr Popodopolous

[Mr Popodopolous]

In respect of settlement of an exceptional debt there might be a precedent in EFL terms although the background differs, as do the details.

When Randy Lerner sold to Tony Xia in 2016, there was a clause that said in the event of promotion within 3 seasons, Tony Xia (or the club) pay Randy Lerner £30m. Was there a discount on initial takeover? Maybe.

As we all know, Xia ran out of cash by summer 2018 or couldn't get cash out of China and Aston Villa were purchased by a pair of billionaires. They got promoted in May 2019 and the new owners settled the debt. It went through the club accounts, but was settled by the new owners and appears that it didn't count towards P&S/FFP.

Irrespective of this, the EFL needed a stricter Business Plan on takeover to properly factor in not only 2018/19 but the next stages of the P&S cycle, although that's a different debate...I think they had the power under Regulations with Future Financial Information in mind etc. 

In respect of P&S/FFP I'm unsure that claims against clubs would count towards the £39m (also adjust for division) loss limit in any event, costs of exceptional litigation? Same way that QPR's fine doesn't count towards the £39m limit.

Edited February 11, 2022 by Mr Popodopolous

[BTRFTG]

45 minutes ago, ExiledAjax said:

Seems broadly fine and eminently sensible to me. MM enters into an agreement with Boro. He pays money - or promises to pay, whatever - and Boro agree to withdraw the claim. The word 'accord' means nothing legally, so I imagine you dig out a settlement agreement precedent document and start with that. Derby County FC don't really need to be involved. Settlement agreements generally avoid saying that anyone admits any fault for anything, they basically say "it's cheaper and quicker to settle now than drag this through the courts, so let's just swap some money and promises and all go about our lives".

So far as the EFL are concerned, the matter is resolved when Boro withdraw their claim against Derby County. Do they really care how that comes about? Honestly I don't think so.

As an aside, I guess this might take some heat off of the fixture this weekend.

So how does that work with FFP? If it's all as easy as you make it sound isn't that a surefire loophole for how to improve ones income? X settles with Y for whatever spurious and non-verified claim Z makes in whatever quantum they chose and that's ok, is it?

Say SL sets up a shirt company with whom City contract for kit. The kit company produces nothing and City sue citing all sorts of losses. SL personally settles to see City drop the case. Surely that wouldn't be allowed to ameliorate losses?

[ExiledAjax]

Just now, BTRFTG said:

So how does that work with FFP? If it's all as easy as you make it sound isn't that a surefire loophole for how to improve ones income? X settles with Y for whatever spurious and non-verified claim Z makes in whatever quantum they chose and that's ok, is it?

Say SL sets up a shirt company with whom City contract for kit. The kit company produces nothing and City sue citing all sorts of losses. SL personally settles to see City drop the case. Surely that wouldn't be allowed to ameliorate losses?

Have Boro said that they will include any payment from MM in their 'income' column for P&S purposes? 

Do the current P&S rules allow for such extraordinary income to be included for P&S?

[BTRFTG]

3 minutes ago, ExiledAjax said:

Have Boro said that they will include any payment from MM in their 'income' column for P&S purposes? 

Do the current P&S rules allow for such extraordinary income to be included for P&S?

Clearly, we don't know but whichever column the 'compensation' falls under the net impact is it will, over time, improve that club's financial position against their competitors.

[Mr Popodopolous]

3 minutes ago, ExiledAjax said:

Have Boro said that they will include any payment from MM in their 'income' column for P&S purposes? 

Do the current P&S rules allow for such extraordinary income to be included for P&S?

Perhaps it would appear in accounts as "Confidential Settlement Payment" -  whether it would count towards P&S would likely only be known by the EFL and Middlesbrough.

Sheffield Wednesday had one of £6-6.5m in 2019, appeared to have been compensation for Steve Bruce and his staff. 

Then the other way, should the Aston Villa owners paying Lerner £30m as part of a clause made at time of takeover have been included in or excluded from P&S.

Also of note was a £14.4m "Other Operating Income" which was compensation for HS2- should there not have been some corresponding disposal of land/buildings to reflect this?

[CyderInACan]

11 minutes ago, ExiledAjax said:

Have Boro said that they will include any payment from MM in their 'income' column for P&S purposes? 

Do the current P&S rules allow for such extraordinary income to be included for P&S?

If their claim was for “loss of income” (or potential thereof) then surely they’ll be able to include any settlement of that claim as “income”?

Like Cardiff. If they don’t have to pay the Sala fee that goes back in the pot. If Boro get paid for money they never had the chance to earn, same applies? 

Edited February 11, 2022 by CyderInACan

[ExiledAjax]

2 minutes ago, BTRFTG said:

Clearly, we don't know but whichever column the 'compensation' falls under the net impact is it will, over time, improve that club's financial position against their competitors.

True, but I guess Boro's argument is that they should/could have had some financial gain a few season's ago. Equally had they pursued the claim to conclusion they would have won a compensation amount and so would again have this same financial gain. If it's financial gain that you're worried about then we need a rule that EFL clubs cannot sue each other for money, only principle or some other nominal item.

Worrying about how Boro account for their settlement amount is a step beyond the actual matter of getting them to drop the claim. It's also crucially distinct from your shirt company example as the matter at hand clearly involves a true third party, and presumably everything can be proven to have been decided at an arm's length. That wouldn't be the case in the SL/Shirt company example where all parties are related, and have the same UBO, and it would be much clearer that the whole thing was a sham way to inject income.

1 minute ago, Mr Popodopolous said:

Perhaps it would appear in accounts as "Confidential Settlement Payment" -  whether it would count towards P&S would likely only be known by the EFL and Middlesbrough.

Sheffield Wednesday had one of £6-6.5m in 2019, appeared to have been compensation for Steve Bruce and his staff. 

Then the other way, should the Aston Villa owners paying Lerner £30m as part of a clause made at time of takeover have been included in or excluded from P&S.

Also of note was a £14.4m "Other Operating Income" which was compensation for HS2- should there not have been some corresponding disposal of land/buildings to reflect this?

I have no idea really. My gut is that P&S income should be limited to 'everyday' income generated through football and a narrowly defined list of commercial activities. But I'm no expert on P&S and I would also think that the EFL need to have an element of discretion to cover exceptional things such as HS2 comp.

[ExiledAjax]

7 minutes ago, CyderInACan said:

If their claim was for “loss of income” (or potential thereof) then surely they’ll be able to include any settlement of that claim as “income”?

Perhaps. I would argue that it isn't the same though. The money going from MM to Boro is to induce Boro to drop their claim against DCFC. If it is described as comp for previous loss of earnings then MM is implying his own guilt/culpability for that loss of earning. He won't do that, or at least shouldn't. Therefore I'd expect (although we will never know for sure) that the legal documentation surrounding the payment from MM to Boro will not frame the money as being for loss of earnings, but will relate it purely to the dropping of the claim.

So to my mind if Boro then try and stick it into the P&S income column they are using the money for the wrong purpose.

I'm so far into the ocean of conjecture, speculation, and personal opinion that I could be wildly wrong, and the opposite arguments are completely valid, but this is kind of how I would frame it were I MM's lawyer.

[Mr Popodopolous]

14 minutes ago, CyderInACan said:

Like Cardiff. If they don’t have to pay the Sala fee that goes back in the pot. If Boro get paid for money they never had the chance to earn, same applies? 

Cardiff and Sala is a bit different as I understand it but see what you're getting it. Will post a bit about it on the FFP thread tomorrow.

[CyderInACan]

3 minutes ago, ExiledAjax said:

If it is described as comp for previous loss of earnings then MM is implying his own guilt/culpability for that loss of earning. He won't do that, or at least shouldn't.

The settlement agreement will likely be without prejudice and with the payment being made with no acceptance of the veracity or otherwise of the claim(s) made. 

[semblar]

3 minutes ago, ExiledAjax said:

Perhaps. I would argue that it isn't the same though. The money going from MM to Boro is to induce Boro to drop their claim against DCFC. If it is described as comp for previous loss of earnings then MM is implying his own guilt/culpability for that loss of earning. He won't do that, or at least shouldn't. Therefore I'd expect (although we will never know for sure) that the legal documentation surrounding the payment from MM to Boro will not frame the money as being for loss of earnings, but will relate it purely to the dropping of the claim.

So to my mind if Boro then try and stick it into the P&S income column they are using the money for the wrong purpose.

I'm so far into the ocean of conjecture, speculation, and personal opinion that I could be wildly wrong, and the opposite arguments are completely valid, but this is kind of how I would frame it were I MM's lawyer.

But I'm actually less worried about the 'Boro side of things.

 

Say they have settled on (for example) £1m to be paid by MM to 'Boro. All paid, all settled, the claim goes away. But what if Derby survive (perfectly possible) and their accounts for this year have a £12.9m loss? If Derby had agreed the £1m and paid it, their loss would have been £13.9m and therefore breached their reset P&S limits

[CyderInACan]

5 minutes ago, ExiledAjax said:

I'm so far into the ocean of conjecture, speculation, and personal opinion

Love this phrase. 

[Mr Popodopolous]

3 minutes ago, semblar said:

But I'm actually less worried about the 'Boro side of things.

 

Say they have settled on (for example) £1m to be paid by MM to 'Boro. All paid, all settled, the claim goes away. But what if Derby survive (perfectly possible) and their accounts for this year have a £12.9m loss? If Derby had agreed the £1m and paid it, their loss would have been £13.9m and therefore breached their reset P&S limits

Very good point, although I do believe the costs of exceptional litigation can be excluded from P&S- would these claims fall under this category had Derby themselves paid up?

[REDOXO]

I guess we can speculate at what the “accord” maybe. But in view of where we are I’m not sure I would trust Morris to actually pay money up front. 
 

Watch this space as I feel it’s all a bit convenient to lower the temperature for tomorrow!
 

 

[BTRFTG]

19 minutes ago, ExiledAjax said:

True, but I guess Boro's argument is that they should/could have had some financial gain a few season's ago. Equally had they pursued the claim to conclusion they would have won a compensation amount and so would again have this same financial gain. If it's financial gain that you're worried about then we need a rule that EFL clubs cannot sue each other for money, only principle or some other nominal item.

Worrying about how Boro account for their settlement amount is a step beyond the actual matter of getting them to drop the claim. It's also crucially distinct from your shirt company example as the matter at hand clearly involves a true third party, and presumably everything can be proven to have been decided at an arm's length. That wouldn't be the case in the SL/Shirt company example where all parties are related, and have the same UBO, and it would be much clearer that the whole thing was a sham way to inject income.

In this case Boro's argument remains untested conjecture, yet still generates monies for them.

Appreciate my SL example was lazy but it's only one small step to extrapolate to 'independent' yet 'friendly' third parties. Could become a cottage industry in contriving novel means of gaining compensation.

[ExiledAjax]

1 minute ago, CyderInACan said:

The settlement agreement will likely be without prejudice and with the payment being made with no acceptance of the veracity or otherwise of the claim(s) made. 

True, true. A good point. But in my opinion not one that allows Boro to book the settlement money as "lost income now gratefully received". It's still a payment made purely to get them to piss off.

1 minute ago, semblar said:

But I'm actually less worried about the 'Boro side of things.

Say they have settled on (for example) £1m to be paid by MM to 'Boro. All paid, all settled, the claim goes away. But what if Derby survive (perfectly possible) and their accounts for this year have a £12.9m loss? If Derby had agreed the £1m and paid it, their loss would have been £13.9m and therefore breached their reset P&S limits

I do agree that it would be better if it was Derby settling the claim, that is certainly cleaner. But the whole point is they have no money to do so, and if they fight it they will be liquidated. The golden rule of litigation is to only sue people with money, and the silver rule is that if offered a deal that you can swallow you take it. 

This deal isn't perfect, and it may well cause problems down the line, but I can see how all parties are happy that the matter is settled and can be set aside.

[ExiledAjax]

Just now, BTRFTG said:

could become a cottage industry in contriving novel means of gaining compensation.

Shall we start drafting a set of precedent documents that we can flog to 72 EFL clubs? 

[CyderInACan]

4 minutes ago, ExiledAjax said:

True, true. A good point. But in my opinion not one that allows Boro to book the settlement money as "lost income now gratefully received". It's still a payment made purely to get them to piss off.

I get that. And it’s obvious that a commercial view has been taken.  But if the outcome of litigation specifically for “loss of income” (or any other term implying the same or similar) results in that litigation being settled for x amount then presumably they could demonstrate, on the balance of probabilities, that the monies received were in remedy of that litigation and thusly legitimate “income”. 

Anything can be argued til the cows come home obviously but it will be interesting to see how it is officially categorised. 

[Davefevs]

1 hour ago, semblar said:

But I'm actually less worried about the 'Boro side of things.

 

Say they have settled on (for example) £1m to be paid by MM to 'Boro. All paid, all settled, the claim goes away. But what if Derby survive (perfectly possible) and their accounts for this year have a £12.9m loss? If Derby had agreed the £1m and paid it, their loss would have been £13.9m and therefore breached their reset P&S limits

I was just about to post similarly.  I’m guessing that’s why Quantuma are involved.

[PHILINFRANCE]

1 hour ago, REDOXO said:

But in view of where we are I’m not sure I would trust Morris to actually pay money up front. 

Watch this space as I feel it’s all a bit convenient to lower the temperature for tomorrow!

I was thinking along the same lines.

There has been a lot of concern that tomorrow's match might turn violent, and it is extremely convenient for all involved that a last minute 'solution' has been found.

It remains only for Quantuma to draw up the necessary agreement, and then all is Hunky Dory: in the meantime, the fans, both Home and Away, can attend in good spirits. Problem solved.

It is now Friday evening, however, and, to my knowledge, no formal announcement has yet been made.

The cynic in me wonders whether an unforeseen 'problem' with the proposed agreement might be discovered on Monday morning. 

[Port Said Red]

It appears that someone has been busy editing Wikipedia.......

Morris was appointed Commander of the Order of the British Empire (CBE) in the 2017 Birthday Honours for services to business and charitable services.[3] Best mates with Steve Gibson chairman of Middlesbrough FC and fierce supporter of the EFL.

[Derby_Ram]

Fair warning that this is typical of many local newspaper sites - full of ads and ridiculous scrolling required - but Quantuma have broken cover in a joint interview with local radio and newspaper

https://www.derbytelegraph.co.uk/sport/football/football-news/derby-county-middlesbrough-efl-gibson-6646390

In summary they can't detail nature of the agreement with Morris/Gibson. Will reach out to Wycombe and don't forsee any issues. Progress should be quick from here and preferred bidder in 10 days or so. The audio version betrays a clear annoyance with the EFL.

Finally the pressure can be directed squarely at one group. They've been a disaster so far but over to Quantuma to deliver.