Tuesday, 15 September 2020

Wishin' and hopin'

Nobody’s in any doubt that we want Thomas Sandgaard to emerge as the owner of our club, including its associated assets, as soon as humanly possible, and for Duchatelet, Nimer, Southall, Elliot and all their actual or possible contacts/backers etc to disappear (we are I suspect willing to see the Varney/Barclay partnership still be in the picture, in case money runs out further down the line). Just that earnestly desiring such an outcome doesn’t make it happen – and there does seem to be some wishful thinking involved in some quarters. In the words of the immortal Dusty Springfield (or rather whoever actually wrote the song), “wishin’ and hopin’ and thinkin’ and prayin’, plannin’ and dreamin’ each night of his charms, that won’t get you into his arms.”

We do I think, however regrettably, have to acknowledge the fact that Elliot has a realistic case, not necessarily a winning one, as to date the courts have ruled (which is to say absolutely nothing with regard to his recent statement of intentions concerning our club). There is no doubt that Duchatelet sold us to Nimer/Southall, ie East Street Investments, and that ESI in turn readily acknowledged that it had sold us on to Elliot. It said as much – and for a period Elliot acted, without contradiction from any other party, as if the purchase had been finalised and he was the owner.

If indeed the deal between Nimer (dragging Southall with him) and Elliot took the form of a binding and exclusive agreement to sell subject to certain conditions, presumably Elliot and his people passing the EFL’s fit and proper person test, that agreement stands I assume unless and until Elliot’s appeal against the EFL’s rejection of him has been heard. In that context the fact that Elliot has not yet paid the £1 for the shares in ESI is I think irrelevant, as implied by the fact that the first judge did not throw out his claim for an injunction; after all, the original judge’s verdict was not that Elliot did not have a case, only that the case needed to be fully explored with a trial and that the risks involved with an injunction on a further sale in the interim outweighed the benefits of an injunction (the line that was overturned by the court of appeal).

We’ve subsequently seen the rumours that ESI has not made a scheduled rent payment and that on this basis Duchatelet could tear up the original sale of the club to ESI, rendering irrelevant whether or not Nimer actually sold us on to Elliot. Love to see that happen, but I find it hard to believe that Elliot would not have another case to put before the bench. I would imagine he could reasonably claim that as the shares in ESI have not formally been transferred and he is not yet formally the owner of ESI (the company) he is not yet liable for the rent payment (or indeed able to make it other than in the form of a loan to ESI) but that he stands ready to make the payment as soon as the EFL accepts his appeal and declares him fit and proper and he completes the purchase of ESI.

I would imagine (but I’m not a lawyer) that a court would be sympathetic to such a position, especially if Elliot can indeed point to his already having spent £0.5m keeping Charlton going. That Duchatelet may be furious that he hasn’t had his due dosh is his problem and his alone, one he brought on himself by pricing decent buyers out of the market for our club and dealing with chancers. I’m also inclined to believe that if the original sale to ESI could have been scrapped by this means it would already have happened.

That leaves us with the possibility that the ex-directors could still emerge as the white knights to contest/reverse the original sale by Duchatelet to ESI, which would I imagine take some time to work its way through the courts, or that for whatever reason/incentive Elliot agrees to stand aside and tear up his deal with Nimer, leaving the way clear for Sandgaard to pay Nimer his £1 and then cut a new, clean deal with Duchatelet, or for ESI to go into liquidation (which as things stand we assume Duchatelet does not want to happen). That too has not yet happened, which means that either no incentive has been offered to Elliot, no acceptable incentive has been offered to Elliot, or that he – and/or whoever is behind him - is not interested in walking away at any price.

Here too wishin’ and hopin’ doesn’t look likely to cut it, but the court’s ruling on Thursday will presumably change the picture for better or worse. If Elliot gets an injunction on a sale until a November trial at the least the price for him walking away goes up (and vice versa). So too would an EFL ruling on Elliot’s appeal. If he passes the test I imagine he pays the £1 for the shares, pays Roland his rent, and then argues the toss over whether or not he will after all sell. The only upside to that scenario is that at least presumably the EFL’s restrictions on our transfer spending would be lifted.

I’ve no idea of the chances of either or both decisions going our way. Presumably the EFL decision is the more important since if Elliot is blocked again by the EFL, which could not be down to ‘technicalities’, surely his purchase agreement with Nimer goes by the board, even if he gets his injunction. One day there will be clarity, but in the interim wishin’ and hopin’ is what we are left with – including of course when it comes to tonight’s game.


Anonymous said...

Non-payment of the agreed sum by any party to the contract will definitely defeat their argument that the contract is completed, regardless of how small or token that sum might be. That's precisely why these things happen for the £1 price. There has to be valuable, measurable consideration from both parties to the contract for that contract to be fulfilled. Shares in ESI from one side, and £1 from the other. The alleged transfer of shares was never recorded where the law requires the record to be made: persuasive evidence of non-completion. £1 not paid: prima facie non-completion. Balance of probability is that the contract has not been fulfilled. Equity demands that either the contract be fulfilled which requires all terms to be completed, or the parties are restored to their state before the contract existed i.e. no payment and no share transfer.

Sciurus Carolinensis Nemesis's view is that the £1 stays in one pocket and the shares stay with the recorded holder, enabling said holder to subsequently sell the shares to whomsoever he chooses at his absolute discretion.

Blackheath Addicted said...

Sounds good Anon. I'd still point out that the formal transfer of shares is not the be all and end all if Elliot has a binding contract for sale/purchase. If there is such a contract it would prevent the legal owner of the ESI shares from selling them to someone else - unless of course some condition of the contract has not been fulfilled/complied with such that the contract can be broken. If it had been straightforward surely the original judge would have thrown out Elliot's case for an injunction.