JUDGEMENT DAY
LIVERPOOL fans, players and directors are on tenterhooks this morning as they await a momentous and potentially historic High Court judgement that has huge ramifications for the club’s future.
At 10:30am the judge, Mr Justice Floyd, is due to deliver his verdict on the civil war that has engulfed Anfield and now threatens to see one of the biggest names in world football suffer the humiliation of administration.
He was yesterday asked by Royal Bank of Scotland to issue a mandatory injunction preventing Liverpool’s owners Tom Hicks and George Gillett from sacking members of the board and replacing them, as they have sought to do.
Hicks and Gillett, in turn, entered a counter-application that Liverpool’s board be prevented from pushing ahead with their plans to sell the club to New England Sports Ventures, owners of baseball’s Boston Red Sox.
Liverpool board members, led by chairman Martin Broughton, are hopeful that victory for RBS, which is owed more than £200m by Hicks and Gillett, will allow the £300m sale agreement already in place with NESV to be rubber-stamped without delay.
The club have also taken legal action to seek a declaratory judgement from the courts that affirms the board’s right to sell to whoever it deems the right bidder, despite Hicks and Gillett’s reluctance. But if RBS win today then Liverpool’s QC Lord Grabiner said it was “likely it won’t be necessary to complete our claim” in order to push through the sale.
However, in a sign that this saga may yet contain a few more twists, Mr Justice Floyd warned: “The mandatory injunction isn’t quite going to give you what you need.” That view was in light of the contract between Liverpool’s board and NESV containing a get-out clause for either party if the club do not make every attempt to get that declaratory judgement by 1 November.
Liverpool’s legal team countered that the contract did not necessarily demand the declaratory judgment be obtained; merely that both parties had the right to walk away if it was not. Assuming the club and NESV still want the sale, that would prove no obstacle.
If it all seems mind-bendingly complicated, then one thing is clear: Hicks and Gillett are not letting the club be sold without a fight, despite their debts to RBS being due for payment by Friday and their own acceptance that a sale is now inevitable.
Paul Girolami QC insisted they were not seeking to put “a spanner in the works” by opposing the sale to NESV, just trying to ensure they got the best deal. With two other bids on the table, from Asian billionaire Peter Lim and American hedge fund Mill Financial, they believe they are being sold short, he said.
Hicks and Gillett asked that the trial be postponed until next week, in order for minutes of board meetings to be submitted and key figures questioned, but Mr Justice Floyd proceeded with almost five hours of arguments. Mr Girolami also argued that there was “no reason” to rush matters, as the contract between Liverpool and NESV locks in both parties until 1 November, and RBS would be unlikely to exercise the administration option while a deal hung in the balance.