Endgame at Southend?
Posted by John Beech on July 8, 2010
The key outcome, at least in the short term, of today’s appearance in court over a winding-up petition from HMRC is that the club has been given another fourteen days to settle the debt of £238,710 (1). However, the club has been asked to show that it is financially solvent if it is to avoid being put into Administration when it returns to court on 2nd August. This has an all too familiar ring to a Pompey fan.
The club website (2) paints a picture, as one might expect on past form, of HMRC being unreasonable:
Yesterday the Club had arranged funds for the full amount to be sent to HMRC’s solicitors.
At the last minute HMRC added costs and a further sum to the petition which the Club was unable to arrange to transfer in time.
Despite an offer to pay this further sum in three to five working days the proposal was not agreed by the Revenue and they continued their request for administration.
The Club has now until 22nd July to produce evidence that it is able to meet its liabilities on an ongoing basis going forward.
The Southend Echo however paints a rather gloomier picture (3):
SOUTHEND United has won a temporary reprieve against going into administration over a £238,000 tax debt.
Her Majesty’s Revenue and Customs today applied for an order at the High Court to send administrators in to run the company, branding it “demonstrably insolvent”.
The court heard the club had not filed any evidence to defend the application since it was served on June 28.
Again, this rings some bells with a Pompey fan.
It’s a busy time in court for Chairman Ron Martin, which might explain why the latest of his ‘blogs’ is dated 13 April (3), where he informs us:
In my efforts and intention to discharge the HMRC indebtedness I have had little to no time today to turn my attention to the intended “third and final phase” blog.
My apologies for this but I am sure supporters will understand the importance and I will ensure that the blog is completed and dispatched on Wednesday.
You might feel that you have been caught in Groundhog Day (the ‘third and final phase’ blog has not appeared, and he is of course referring to an earlier court appearance against HMRC – keep up at the back!).
Due next week is the court appearance regarding the winding-up petition brought by Charterhouse Commercial Finances. The club website purrs “With regards to Charterhouse Commercial Finances’ petition funds are in place to meet that liability“. According to the Southend Echo this is over a debt of £140,000. Let’s hope the Groundhog Day theme is not continued and that at the last minute Charterhouse Commercial Finances does not add costs and a further sum to the petition which the Club is unable to arrange to transfer in time.
Meanwhile, the Southend Echo also highlighted (4) the fact that a Ron Martin company is in trouble, with, erm, HMRC, would you believe. Martin Dawn PLC, a property development company, is facing its sixth winding-up petition since 1999 apparently. The current debt is one of £96,367.
Between the court appearances Chairman Ron has been recording video interviews for the club website. In the latest (5), he speaks about the great stadium saga, saying “We have moved mountains to get where we are“. Unfortunately, after 12 years that remains Roots Hall, with Fossetts Farm still remaining the stuff of dreams.
All in all, I fear there is not much hope of a nomination for best management practice this year at Southend United.
In court today, Charterhouse Commercial Finance Plc was granted an adjournment of their winding-up petition over a debt of £140,000 (A). The new hearing will thus be after the HMRC hearing, which is due on 2nd August.
The HMRC winding-up petition has been withdrawn, the club having paid the debt (B). HMRC, who had argued that the club was insolvent, warned however that any future late payment will see the club back in court. Chairman Ron Martin said that the payment had in part been met by Sainsburys, and commented “I would have liked to have said some months ago that this is what I was anticipating, but the outcome is what I thought it would be“, the meaning of which has escaped me so far.
The club still faces a winding-up petition from Charterhouse Commercial; Ron Martin said “We’ve made provision in our cashflows to make sure all debts, as they fall due, are covered over the next 12 months“. For the fans’ sake, here’s hoping.
The transfer embargo remains in place, but Martin is hopeful of it being lifted very shortly.