Court Case / Move from Oakwell - Further BFCST Update

The extent to which any covenant is easily identifiable depends on whether the land is registered at HM Land Registry. Registration has been mandatory upon a sale of property for many decades. When you buy a residential property it is almost certain to be registered land and all the solicitor needs to do its look at the relevant registered title at the land registry. Land which has not changed ownership fora long time may be unregistered. Keep in mind that a sale of shares in a company which owns land is not a sale of the land itself, so this would not trigger any activity at the Land Registry. Where land is unregistered the solicitor needs to review all the deeds to establish ownership of the property and identify covenant and other encumbrances.

In a corporate transaction like the takeover of the club the vendor would usually make available a virtual data room Containing documents relevant to the transaction. It’s up to the purchase to decide which documents to review, whether to ask for more etc.

 

No way a man like Chien goes into a deal worth millions without having his team go through it with a fine tooth comb.
Given the size of his company, I would expect he either has employed Solicitors or at worst retained ones.

 

There's one easy way for Mr Conway to end all this negative speculation about him and his colleagues.

To make an honest statement about the current situation.

The more time that fans are left to speculate then the more we argue amongst ourselves and end up turning on each other.

With the record of our board though, I'm not sure a statement will be forthcoming - unless it's to the Scottish Press about the purchase of another club.

 

Thanks Paul,

this argument about the RC sounds like complete and utter ******** to me

I think @mansfield_red ’s supposition above sounds fairly likely

 

Oakwell (and surrounding land) appears to have transferred to OCAL in the financial year ending 31 March 2004. One assumes that registration would have occurred then at the latest, if registration had not taken place before. It's common of course for the Property Register section of the register of title to state that the transfer takes place subject to any specified retained easements or restrictive covenants recited in an earlier conveyance of the land, so far as they are capable of subsisting and taking effect. So that still leaves open the question of enforceability of the earlier covenants, such as they are. But it may be that BMBC would not wish to be party to overriding the earlier covenants or may even wish to re-state or reinforce the covenants in any sale of it's 50% interest to Lee/Conway et al (see my earlier post at #18). The Crynes may feel that the covenants are unenforceable, but BMBC may take a different view, and may even be determined to ensure that they are reinforced and made enforceable by any disposal of it's 50% interest. Easy to see how that would be a sticking point for Lee/Conway etc.

 

Stadium maintenance? Really? Must be the driers in the bogs again

 

But it may not be minor for BMBC. They may even wish to revive the covenant!

 

Are we saying that this restrictive covenant, and whatever/whoever it involves, and the "third party" are one and the same?
It appears that the Crynes are happy to sell their 50% but are also held back by the covenant.
It seems that the 80%ers are saying to the Crynes, get this covenant sorted or we are done and will move the footballing side elsewhere. Oh, and by the way, contribute to the high maintenance costs cos we owe you 2.75m and you won't get any of it until you do.

 

Just to put in my bit on the maintenance costs/rent scenario. (I am manager of a UK Arena/multi purpose events space)

There are two standard agreement types when it comes to operation of a stadium/venue - either the operating company pay rent and costs, or they are paid to operate the venue and pay costs. In either instance they take a percentage of the profits from activity in the space, obviously a larger cut in the event of the rent paying option.

Oakwell to me seems a very unattractive proposition. The catering is on a concession contract, the opportunity for other events is very limited as the conferencing space isn't particularly impressive, and all stands are aging to various degrees so I can believe a 1m operating cost (although I suspect this covers contracted and general reactive works to the site, and not just the stadium). The profit percentage on operation is going to be very inefficient given the high costs of operating a club.

If we look at another example, the KCOM in Hull is operated by a company run by the owner, and they receive a payment from the council for doing this.

If I were the owners I'd want to make sure my money wasn't being used to improve somebody else's asset, so naturally would want to buy the venue. I can't comment on the legalities regarding the covenant, however I suspect they may be concerned at the effect it would have on future sale, value, and ability to do other licensable activity beyond football on the site.

I do think the council need to reassess what is perhaps an unfairly weighted deal if they want to stave off this threat (and I suspect that is the owners intention) - given the 9 year term remaining. Again, these deals usually have 5 year break clauses in them but I'm assuming this one doesn't or else it would have come up last year.

 

The size of which company though? His main registered company that I could find has just one employee. Him.

 

This covenant that seems to be the big issue, is it the rumoured "ransom strip" that someone kept when gifting the land to the club originally? If so, then I thought it only applied while for 2 generations of the owners family were still alive(would that be their great, great grandkids?). If so, then it would be very simple for the Crynes to pay a solicitor to find out if a)they are still alive(proving BFC have nothing to worry about), and b)if they are still alive, see if they would waive it/sell it(meaning the club have nothing to worry about). With the money the Cryne family stand to make from the sale, the investment in a solicitor would be well worth it to them.

It would also show the world that it is the club's majority owners that are the villains of the piece if they still carried on playing silly buggers after it is proved beyond doubt that there is nothing legally stopping them buying the ground...

 

Man alive if I knew about this covenant 20 years ago I’m sure some swanky mcswanky lawyers uncovered it whilst negotiating a multi million pound deal. When JD told me about it he said it was unenforceable then and that he had never really had to consider it because what else would you use Oakwell for other than sport.

 

The Cryne's have already done this.

 

Mentioned it on another thread. It's a combative measure by the new owners to wriggle out of paying what's owed.

 

Is it possible that John Dennis bought some of the land before the club entered admin and it was only the footballing side that went down the toilet?

 

As I understand it, covenenants that are deemed to be unfairly restrictive can be easily overturned, especially as time goes on. I think it very wrong of the 80% owners to backtrack on the money they agreed to pay for the sale of the club. It must make the day to day working relationship very difficult.

 

Thanks Gally.

So potentially £16 million quid PLUS the land for a club that we are continually told is lowest budget, lowest payer, lowest crowds etc ?

pmsl

What was it bought out of admin for ? £3.5m ?

See ya