Ashley v SFA: CoS-Outer House 4-5 Feb 2016

This is a record of what I am sure I heard, as it was said. People spoke sometimes quickly, sometimes softly, sometimes changing their sentence in mid-stride, sometimes ‘umming and erring’, sometimes abandoning their line of thought or a half-asked  (or, maybe, half-arsed, question). I scribbled down what I clearly heard as best I could. (I did hear the ‘rising from the ashes’ bit that eJ posted, but I think I was laughing with incredulity and didn’t write it down).

I have left blank spaces where I could not read my own writing or simply hadn’t heard at all, or heard only partly. And here and there I have put in a suggestion as to a word or phrase that might have been used but which I either did not hear or for some reason did not scribble down. I have not deliberately invented anything or put words in people’s mouths that changed the meaning of what they were saying.

Nevertheless, I don’t claim this to be anything other than my personal notes, honestly written. John Clark. 07/02/16

Comments on any of the content should be made on the main blog thread.


 

Thursday 4th February 2016

Court of Session-Outer House, Court 10, First Hearing

P989/15Pet Michael Ashley for Judicial Review. Before Lord Brodie

Brodies LLP Burness Paull LLP

Court sat at 10.00 a.m

Judge Brodie formally disclosed that when he was at the bar before 2002 he chaired the SFA’s Arbitration Panel up to 2008 and thereafter he may have been a name available to the SFA. He has not acted for them in any capacity since 2008.

He asked Counsel for each party whether they had any objections to him presiding over the proceedings. Neither had.

Mr Sandison ,Counsel for Ashley, was on his feet all day.

He set out the various rules governing the SFA’s Judicial Panel Protocol ( particularly Rule 19, which deals with ‘dual ownership’ of clubs) and the Articles of Association( especially Article 13.1, which members of the SFA and Leagues sign up to, and which form the context in which the charge against Ashley was brought.

These are the rules supposedly contravened by Ashley: ” …in already having an interest in Newcastle United FC ……you entered into a credit facility with Rangers FC……..resulting in Derek Lambias being appointed as a Director of Rangers FC……..”

Mr Sandison: “Rangers FC” is formally “Rangers Football Club Ltd, the shares of which are wholly owned by Rangers International Football Club plc”

Mr O’Neill, Counsel for the Respondent (interjecting): ” Rangers FC is the club as defined in the Articles of Association….there is a distinction between incarnations…”

Mr Sandison:.”..our position remains as I said..”

Judge: The court relies on the professionalism and good humour of Counsel.

Mr Sandison: Rangers Football Club Ltd is NOT Rangers International FC plc…. The Petitioner is NOT a member of the SFA, or a shareholder in Rangers Football Club Ltd. In October 2014 MASH held a minority stake in RIFC plc [ 8.92%]

Now, we say there is jurisdiction in this Court for the Judicial Review process. ( He referred here to a number of cases)

Now, on the one hand we have the SFA. On the other, a separate organ, the Judicial Panel, which exercises [edit: disciplinary? Sundry? ] functions

Now , there is no dispute that this is a dispute in Private law. [refers to the case of a prison officer (Forbes?) in which a decision by the Prison Authorities on the officer’s removal expenses was held as being a matter for Judicial review, and an SFA 1985 case, defining the tripartite relationship , and a question of whether there had been a departure from the rules of natural justice.]

That’s the basis of our position, …..

Is the Petitioner excluded from Judicial Review? Can be, but it must be clearly stated in the organisation’s rules and contracts.

[He referred to ‘agreements’ that excluded an approach to the Courts, and cited a case in which Lord Reid said “ it is a well-established principle “………..[edit:I think he then modified that, and said “ there is a strong presumption that the Courts cannot be excluded.]

The agreement in 65.5 of the SFA Articles of Association makes it clear that the fact of membership shall require members not to take questions to a Court of Law.

I submit that this article excludes an approach to the Supervisory function of the Courts.

  • But Ashley is NOT a member of the SFA.
  • ‘Member’ is either a ‘full member’ or a ‘registered member’
  • full member is a ‘club or association’
  • registered member is ‘ club or association which has been admitted’.
  • It is not possible for an individual to be a member of the SFA!

Is Ashley subject to the Judicial Panel at all?  And if he is, is he excluded from the exercise of the Supervisory function of the Courts?

As at October 2014, he was not a shareholder himself, but as MASH, in the public company, not the private company

The degree of clarity [edit:of the charge?]is not sufficient to catch him by Article 65.5. Ashley did NOT become a member of the SFA

He said he would ‘abide by’………but it is only the FACT of membership that binds.

We can look at the ‘elasticity’ of words, [ edit; presumably meaning different meanings of the same word being allowed by the rules] but there is no express provision that allows a change in the the meaning.

What then is the basis for the respondent’s claim that Ashley is excluded..?

Judge :the scope of Article 65.5…….?

Mr Sandison: Turn to letter of 6 August 2012 by Ashley “ I Michael Ashley .. shareholder, director , manager of Newcastle FC and of SDI……..I intend to become a shareholder of Rangers FC Ltd which owns the club known as Rangers Football Club…… I agree as long as I am a shareholder of Rangers Football Club Ltd ……….”

Is he subject to the Judicial panel at all? And if he is, is he excluded from the exercise of the Supervisory function of the Courts?

As at October 2014 he was not a shareholder himself, but as MASH, of the public company, not the private.

Judge: Distinction between member and not member… .. is it your position that Art 13.1 …….

Mr Sandison: Art 13.1 says ‘no person’ can be a ‘member’.Rangers Football Club Ltd, a private company, is a member. They might have been restrained.

But if I’m wrong in this, then what is the actual true import of 65.5? Is he required to go to the Judicial panel rather than law?

He went to the Panel, and lost., and to the Appellate body, and lost.

Now, I’m aware that this Court is not acting as another ‘appeal’ level.

But there is the quite separate issue: whether they transgressed in the exercise of their functions falling within the limits or outside the limits the law allows?

Art. 99 of the Articles of Association ( 99.5, 99.6, 99.7) purports to recognise that ‘Arbitration’ and such are NOT to be adopted. That is, there is recognition of the function of the Court as a means of checking and ensuring proper exercise of powers.

So much for jurisdictional issue 1.


Jurisdictional issue 2: concerns the nature of the Court’s power to supervise. The Respondent argues that the Court cannot review the decisions arrived at on account of an ‘intra-vires’ error in law.

I submit there is no such limitation [references Lord Reid’s view of the extent of jurisdiction, and quotes a longish passage].

We’ll come to the substantial point of Ashley’s complaint. The Panel failed on natural justice, and on a factual basis made a decision unsupported by evidence, or a decision which no reasonable person could arrive at. I state that these matters properly fall within the scope of the supervisory powers of the Court.

If we turn to the judgement of Lord Hope in ‘Watt v Lord Advocate’ “ … the Court of Session has power………”

and the case of [Diplock?] …………………

I conclude that the matters this Court can deal with are those NOT in ‘Watt’ but in [Diplock?]

Judge: Go back to to examples where the Court could intervene. How would you help me with what Lord Reid has to say about the mistakes Panels are entitled to make that would NOT come to Court?

Mr Sandison; I cannot ask the Court to re-look at the case, and invite the Court to say that it was a decision that no reasonable person could come to.

It is suggested by the Respondent that the scope of review is limited to the situations in the ‘Watt’ case. See the Report of 1993, case before Lord Cullen. The decision was that ‘procedural mistake’ was amenable to review by the Courts.[reads a long piece from Lord Cullen]

And there is another case, Diamond v TJW Enterprises, which was in respect of the question whether there is particular scope for judicial review against the determination of an Adjudicator, [edit: in Housing disputes?] .It was held that it was NOT open to the Court to review.

But the cases cited by the Respondent don’t answer.

The Court is being asked to review the decision of an expressly ‘Judicial’ panel. And therefore it is properly in scope for the Court to look at whether the requirements of natural justice were met, and what the facts were, and whether the conclusion was ‘reasonable’.

If we turn now to substantive matters, the first one I want to discuss is the assertion that the application [for judicial review] is being treated as though this was an ‘appeal’.

I am NOT arguing that the Court should re-hear . But the matters are the same, not surprisingly. The way those matters were dealt with are in question.

The second point, that the Courts should give special consideration to decisions of ‘specialised tribunals’: but I submit that that applies only where the specific matters of the complaint require specialist expertise.

Judge: Who was on the Judicial appeal panel? [What] specialist knowledge [did they have]? What degree of deference [ is owed to their decision]?

Mr Sandison: There might be scope if the complaint related to ‘specialist’ business. But in this case the complaint is not ‘specialist’

Judge: By football business I mean not the playing…. You say the complaint is essentially a legal matter.

Mr Sandison: Yes. [ Edit: I suppose he meant that it was not a matter that required particular expertise in the world of the ‘football business’ whether on the playing side or the running of a club]

 

So, now to the substantive issue in the note of argument: the nub of it is that the charge is against Ashley as a person, NOT as a member of the SFA. The credit facility agreement was between MASH Holdings and Rangers Football Club.

If we look at the notice of complaint, delivered to Ashley, the notice of complaint should clearly state the Rules breached, and the name of the person or body, and the date of the alleged offence.. and there is a range of remedies if… [ cited some cases]

The charge should be precisely framed. In this case the charge is done very well, and it is clear that Ashley was charged!

Ashley says he did not enter a contract. The relevancy of that charge could have been debated.

Judge: thinking of relevance of charge?

Mr Sandison:  I can’t speak to the question of whether being merely a creditor of RFC would give someone ‘power’.

Judge: I don’t want to take up time if you ..

Mr Sanderson; No, no: let us look at the rules about ”no person who is………”

Judge: So he is a person managing Newcastle United, he may not be in power at another club..He is the sole director of MASH ,then MASH does something……. to what extent is Ashley separate from MASH?

Mr Sandison: The charge is very clearly addressed to Mike Ashley, NOT to MASH [quotes: “ you entered ….]

Convenient time? Lunch.


 

Court resumes at 2.00 pm.

Mr Sandison: My Lord, your question before lunch [ edit: I think I missed that] , about what was attached to the credit arrangement? There is a redacted document from the SFA about the facility.

Judge: We don’t see a definition of ‘lender’?.

Mr Sandison: No. You will see that Ashley signed ‘for and on behalf of’ lender.

Judge: There was no doubt about which document the charge was founded on?

Mr Sandison: No doubt. The case is that Ashley/ MASH by lending became liable as a ‘member’

Judge: If the charge had read ‘..you, as the controlling party of MASH….’? If the charge had been differently worded,well and good. But the charge said ‘Ashley’

Judge: if the charge had read “ ..you, as controlling party of MASH..’

Mr Sandison: But we are here to look at the charge as formulated .The Respondent has to show that Ashley is MASH.

Judge: I understand that point.

Mr Sandison: the decision of the Judicial Panel shows no evidence of ‘lifting the corporate veil’. See the case of Crest v [?].Simply no material whatsoever. Nothing to show the Mash connection with ‘Ashley’. The mere fact that Ashley controls Mash provides no basis. The judicial panel expressed themselves in brief terms: refers to position adopted by Ashley. And records correctly that it was signed ‘for and on behalf of’ MASH, NOT by Ashley as a member.

Judge: Was the corporate veil pierced?

Mr Sandison: Attributing the action of a company to the action of an individual…takes us into [edit: I didn’t catch the words that followed,, but the import seemed to be that it’s basic to capitalism that there is a distinction between the owner of a company as a person, and the owner as being the company, or some such]

Judge: You accept there can be circumstances….

[ a wee discussion followed about ‘lifting the corporate veil’ and the legal implications of treating the actions of the owner of a company as being the actions of the company. ]………….

 

Judge: You said it was not an area where the expertise of footballing people might supersede…

Mr Sanderson : Now, the appellate panel.’ Permitted grounds of appeal’.[ read the various grounds of appeal- among which are : failure to give a fair hearing and reaching a decision which it could not properly …Tribunal averment “ and RFC Ltd” ….the Appeal tribunal is ‘contrary to the clear wording’… [ I dozed off for a second or two at this point and picked up at ]

‘ …. it’s not fair process to found a decision on a differently worded charge. What MASH did was done by MASH, not Ashley. There is no evidential data to justify the Appellate Tribunal’s decision.

The second substantive argument: There was an error of law: no evidence to support the view that Ashley is MASH.

  • There is the statement by Lambias himself, about his relationship to Ashley, and the disagreement between Ashley and Lambias.
  • And Mr Somers, what he wanted as Chairman,in October 2014,
  • and the suggestion by Ashley that Lambias could be a consultant at RFC ,
  • and Somers pleased with his good performance appointed him to the Board
  • and Justin Barnes : “ Mr Shackleton [ NOMAD] called me -Mash have to make 2 nominees to the plc….Mash’s other nominee…..only discussion was between NOMAD and me ..”
  • and letter -MASH has not sought to appoint a director,
  • and the waiver of right-to-nominate

Judge: Witnesses didn’t appear?

Mr Sandison: the central part of the conclusion that Mr Lambias’ appointment to RFC Ltd is down to Ashley is missing. There is no link. “Panel was drawn to witness statements.. MASH holding right to appoint 2 directors and to RNS statement. The Panel talked of vagueness. [] do suggest that the appointment of Lambias was at the instigation of the club.

There is no evidence that MASH ever nominated a director.

What did the Appellate tribunal say? “…would be the same persons nominated by the lender for the RFC Ltd”

There is no dispute that the appointment of Lambias to RIFC plc took place as a result of Shackleton/Somers discussion. Not by Ashley.

Judge: …….?( I think he asked what the agreement said)

Mr Sandison: The agreement between RIFC plc and MASH is that 2 persons would be nominated to the PLC Board and any nominees to the RFC Ltd board would be the same people.

The Tribunal refers to the statements of the witnesses…………..

The problem is a simple one: What was the evidence that the appointment to the RFC LTD was as a result of any nomination by MASH?The Tribunal cannot decide when there is no evidence.

And there is no evidence that Ashley had transgressed the rules….

The tribunal seem to have operated on assumption.

The third substantive matter: the suggestion that the tribunal were entitled to accept the appointment of Lambias to the RFC LTD is rejected. But even if they were there would be no basis that the power of nomination gives the power to affect the administration…

Judge: That’s not clear to me.

Mr Sandison: I accept that in the abstract a nominator could be influencing the company by nominating as a Director someone of talent who was going to use histalents for the club’s benefit.I don’t accept that there would be power to influence on the operational level.

Judge: the power to nominate must be thought to be some leverage, proper, over the business….

Mr Sandison: What’s the purpose? If you’re the creditor then you want to ensure the company’s prosperity by good governance. But that is a wholly different context from that in 13.1

In my opinion the power to nominate does not give power to direct how that nominee goes about his business, for example, the President of the US nominates…..?

It would have to be made out by evidence that Lambias would be contolled by Ashley. There are no relevant findings of fact that Mr Lambias was a place-man.

Judge: Is it possible that 13.1 is ‘preventative’, like the bladed-knife : merely having it is the offence?

Mr Sandison: No, no.Tribunal didn’t find any evidence that Lambias was susceptible

Mr Sandison: on the correct approach to interpretation of 13.1 there is a slight difference between the Judicial panel and the appellate body. The panel said (at 5.5) ……..relationship of Art 19 “……….”

[I read that as meaning even if there were no nomination of any director there would none the less have been a power for Ashley……]

Judge: ..seen that the credit facility gives right to nominate……

Mr Sandison: But there was a waiver. It would not be possible to draw down, the waiver did not remove the power of MASH – you can draw down despite not making a nomination, but the right to nominate remains.

Judge: That is the Panel’s interpretation?

Mr Sandison: Yes. The mere right brought him into the ambit of 19…but the Tribunal said the very granting of the right gives. [the power of influence]……. but the Compliance Officer did not really …[?] restriction.

So the Tribunal had a different view and the scope for conflict is clear.

I think there has to be a real possibility of conflict before Art 19 can be used . Would a sensible person conclude that there would be conflict?

Judge: Nomination of A N Other can never do, until something is done?

Mr Sandison: A sensible person wouldn’t see conflict in the circumstances. Lambias had had a major disagreement with Ashley, and had not spoken to Ashley since.

I hope the difference between my approach and the Tribunal’s is clear.

I say this is a perfectly legitimate application to the Supervisory power of the Court. And the substantive grounds I have advanced are within the proper scope of the exercise of supervisory power.

The upholding of the complaint cannot stand……….what happens thereafter will be up to the SFA.

Judge: [Is] that all the Court can do..?

Mr Sandison: All I ask is reduction of the decision. One final point. ‘Rangers Football Club’ are a reference to Rangers FootballClub Ltd only. The Petitioner denies any suggestion that RIFC plc is a member of the SFA or is any part of the entity referred to as Rangers Football Club. Should any of these matters impinge on the case, there would have to be an examination of the truth…

Judge: To begin with,give me some information on Ashley’s shareholding, 2012…

Mr Sandison: Shell company formed in 2012, came to be called Rangers Football Club Ltd. Ashley acquired shares in that entity...

Judge: That gave him 8%..

Mr Sandison: then there came the IPO..

Judge: PLC formed also in 2012?

Mr Sandison: Yes.

Judge: Rangers International Football Club plc

Mr Sandison: Public shares.. Private shareholders swapped their shares for shares in the PLC. And Ashley ceased to be a member of Rangers Football Club Ltd: that shareholding transferred to MASH Holdings on 01/10/2014

Judge: And the full name is MASH Holdings?

Mr Sandison: Since December 2012, the only members of the Limited Company are the PLC, which holds ALL the shares.

Judge: At least at end December 2014.

Mr Sandison: Mr Ashley held 8.92% [ eJ had his phone out in a second, to check the percentage!] Mr Ashley transferred his shares into MASH [in] 2014. And MASH also got other shares.


 

Mr O’Neill for the Defender:

My Lord, first I should say there have been exchanges between the parties, and I formally adopt the Note of Argument.

I reply to certain points. A theme to the response is , ‘in the law, context is everything’.

The confusion is between Public Law and Private Law, and confusion in the approach to Judicial Review. And then interpretation of Rules, confusion between corporate law and Football. Made most evident in the relation that the 2012 new company is ‘the club’, and this is not a question of fact, but of interpretation and of law, which this Court can determine.

So I say, the context is a footballing context, but we are dealing with the internal affairs of the SFA. It’s an Association [whose aims are] to promote, foster, and develop in all its branches, the game of association football. Fair play,sport,communal activities and the like. Not simply about how companies might develop, but the promotion of the ethos of football. So, in that context, Rules have to be understood. Look at the judicial Panel protocol, at 7.2.4 .. Principles 1 and 2 underlie…

  1. economic expeditious justice… fair….
  2. in a civil and footballing context.

And apply to those submitting to this protocol

There is no doubt that the Pursuer submitted to the panel, we have a clear submission to the jurisdiction of the Judicial Panel, and any breach of Articles and Rules.

So, the acceptance of the context, that the Court is interested and is there possibility of application to the supervision of the Court..It’s worth looking at the ‘letter of undertaking’, the letter from Michael Ashley as an individual to the SFA. [ quotes] “I confirm …..of Newcastle United ….. or of parent companies…. I intend to become a shareholder of RFC Ltd which owns and operates a football club as Rangers FC…”

Therefore, a distinction between the private company known as the club , but is NOT the club

…” I hereby …and agree to abide by…”

Judge: Are you saying the club is any more than a business?

Mr O’Neill: People spend their money on a club, not a business. In the very association there is the notion of ‘club’: the club is the member that brings the passion, the meaning, all that it means..

Judge: Are you saying it is the club which is the member of the SFA?

Mr O’Neill: Yes… if you look at 7.1.9, 7.1.16- at 7.1.16 ‘members shall be’ … and at 7.1.9 back to full member, means club. The club is the member, now, the wholly owned Rangers Ltd and RIFC are the ‘corporate manifestations’

Judge: there’s been a jump here. You say the club is an entity, neither a legal or….

Mr O’Neill: The club is an idea, the law has to catch up with social reality.

Judge: The distinction… voluntary associations.. How jump to PLC?

Mr O’ Neill: My learned friend says Rangers FC the club is the Limited Company, and not the plc. But I contradict that. We’re dealing with ‘corporate surroundings’ a round the administration. My learned friend acknowledges nominations to the plc….

Judge: As a matter of generality, the director of a holding company could influence? Is that what you’re saying?

Mr O’Neill: No! I’m querying the identification of Rangers Football Club Ltd with Rangers FC..

Judge: I’ve written that down ‘the limited company is not the same as the club.’

Mr O’Neill: Ashley acknowledges…

We’ve been told there was a restructuring of Rangers FC Ltd which involves IPO, swop of shares for shares in the PLC, and the PLC became owner and operator. Then Ashley no longer owns shares in the Rangers Football Club Ltd. BUT there is an acquiescence in the judicial panel etc. And we can see why: because it reflects the share ownership, allowing Ashley to influence the Rangers FC.

So, we have an acceptance that he is subject to the Disciplinary tribunal. We then get to 6.2.1, the Complaint against Ashley. And that ties in with the analysis. As already a controlling interest in Newcastle ‘ ..you….( “as the controlling party of MASH “)did nominate Lambias to the club as Director.’ Which resulted in his nomination as director of RFC Ltd and RIFC plc.

Judge: You accept the club has no personality,can’t do anything…

Mr O’Neill: But there is a reality… The Limited company is NOT the club. We cannot let legal corporate fiction …[ ‘get in the way’ I assume. Certainly that is the import of the words used]

 

It is agreed that it is a Private law agreement. We did have ‘specialist’ members on each tribunal. The first one was chaired by a sheriff and also had an academic who studies the football world

the second was chaired by Lord Bonomy, the other members being the Managing director of a club, and the [edit: or ‘a’] head of coaches in the SFA.

These were bringing football expertise and qualified legal expertise. An arrangement that is well understood and accepted, for example, in Employment Tribunals and such like, whose decisions enjoy some deference and respect by the Courts.

So, we have expert adjudicators. No expectation to have to have recourse to Court. The matters were being dealt with under the jurisdiction of the the Judicial Protocol, which says that persons interested through the club shall not be permitted to go to law.

Judge: A person interested ‘through’ the club?.. Mr Sandison said “member” .. 6.1.1 ‘as long as he remains a shareholder of RFC Ltd?

Mr O’Neill: No, by interest in the club, and acquiescence in …

Judge: What are we looking at now?

Mr O’Neill: The Judicial Protocol at 7.2.8. Sets out the powers and jurisdiction of the panel, which Ashley accepted. General powers, e,g 8.1.3, 8.1.2 , “ weight of evidence” 8.5.2 ….. All of this have been acceded to. So Art. 65.5 does bite in this case, and what effects it has..

My learned friend relies on Lord Reid, but that’s in relation to Public Law. Here it is a matter of ‘private contract’ and 6.5.5 ..”.agreement..and shall not be permitted to take such questions to a court of law.”

And here the Public Law paradigm is being applied.

When Lord Hope…

Judge: he was recognising that Supervisory jurisdiction extends to contractual matters in the private sphere. ‘Intra vires’ errors in law are ‘ ultra vires’.

Mr O’ Neill: Can you contract to accept errors in law….. Finality doesn’t mean infallibility.

Judge: You accept that ‘IBAT,’ is the last word in Public Law ? [edit: IBAT might be be a case involving the independent banking association in 1974]

Mr O’Neill: (inaudible words)…private law/public law. What we clearly have is a private law application to the the Supervisory Jurisdiction , not the ordinary jurisdiction of the Court. Did the level below act outwith its powers? The Tribunal is entitled to make mistakes. Look at some cases: Lord Cullen says West [ the ‘West’ case?] was not entitled to dismiss errors of law as a breach of natural justice: the interpretation of the charge is for the Tribunal.

Judge: Can’t really be wholly in the Tribunal’s jurisdiction…?

Mr O’Neill: We look at what [ Ashley] was given notice of. It was the wording of the complaint. There can be no question of not understanding the complaint.

Judge: [ referring to the wording] Why the comma after ‘MASH Holdings’

Mr O’Neill; Is this what it comes down to, where the comma is?

Judge: Would it be convenient if you could give me your reading?

Mr O’Neill: [ reads the text of the notice of complaint]

Judge: When we see “ you” and then ‘MASH’ is that meaning they are the same thing..?

Mr O’Neill: It’s the fair reading…….the credit facility agreement.. If we look at that charge and the documents relevant to it, 7.5.1(3)…..

Judge: was everything at 7.5.153 sent at the same time… [ searches his bundle for Annex B. The bundle is big… Annex C..]

Mr O’Neill: Annex B and C were served, but I don’t know if at the same time…….So, among the documents we see excerpts from 2014, and we see Doc 15, Companies House return for MASH Holdings….

At 7.5.1 2 7, 7.5.1.2.1 “ “ The Board of Rangers announces……. Rangers has nominated a director….’ Rangers sees itself as interchangeable with RIFC plc, the ‘club’..

Judge: Is this a statement the wording of which was suggested by a journalist?

Mr O’Neill: No, the reality is that RIFC plc is the club.

MASH has the right to appoint director to RFC Ltd, and then the PLC invites nominees from MASH for seats on the PLC board… These are public documents…..

So, it is all about MASH Holdings Ltd and its dealing with the PLC and the Ltd Company. For Ashley to complain that “I didn’t receive the charge, it was MASH” is [nonsense]

But that is nothing to the point, and that is confirmed by Article 13.1.

MASH Holdings is clearly an ‘associate’………” YOU, as an associate of….”

It is just nonsense that he was not charged as a person.

Judge: Did the Tribunal take that line?

Mr O’Neill: Para 3.5 [reads ]

Judge: The Tribunal relied on written statements [ edit:or maybe the word used was ‘arguments’?] Do we have them as productions?

Mr O’Neill: Yes. At 7.6.5 8 response by Compliance officer,7.6.14 , Compliance Officer submission, 7.7.1 7.81 7.11

How the Judicial panel dealt with, at 3.7 (Page 12)

They knew what was being charged with, the Tribunal said [ and Mr O’Neill read out something I didn’t catch at all]……..And it’s about football law, not company law.

Judge: You stressed the importance of ‘context’, is it not legal rules?

Mr O’Neill: Yes, it is legal rules within the context of football. It’s about clubs, the game, competition….not a capitalist enterprise, swallowing up competitors. So one can see the need for the breadth of 13.1 .

So that’s as far the 1st point [ about the judicial review being appropriate and relevant]

Going on to the next issue: all we got was a rehash of selected evidence..It was accepted that the weight etc of evidence is for the Tribunal.

Judge: You will let me have the evidence?

Mr O’Neill:Legal inference can be drawn of nomination to the Ltd company.

Judge: date of appointment to the Ltd Company is 5 November 2014.

Mr O’Neill: nomination to plc. [ edit: I didn’t hear the date , if he mentioned it]

Judge: Does that come from Somers?

Mr O’Neill: It comes from 7.3.12. , 7.3.2 is [?] MASH Holdings Oct 2014

R.22

3.734 lender will lend only if nominee… lender means MASH Holdings

Judge: Assuming you had to borrow..

Mr Sandison; interjects: the Borrower in 7.3.3 is the Limited Company

Mr O’ Neill: But it’s the PLC that benefits….

There was the appointment of Lambias to the plc and to the Limited Company.

Judge: Vague, absence of evidence?

Mr O’neill: this is not criminal matter….. balance of probabilities…

Judge: Are you on this issue relying on the Tribunal’s expertise?….

Mr O’Neill: I….

Judge: the argument against you is that there is no evidence but only inference

Mr O’Neill: ..’deference’ due to ‘specialist tribunals’.

In relation to the determination of what the rules mean- and there should be some deference to specialist tribunals . Reading the whole of the note in context…..[edit: I didn’t hear quite what he said, but it was on the point that due deference should be shown by the Courts to decisions of specialist tribunals]

Lunch break’


 

Resumption at 2.00 p.m.

Mr O’ Neill: On the actual influence on a club, we have to look at the reality of independent directors, company law etc, and look at 7.3.6 (13.1) under clause 13 “ have the right to appoint and..” was made conditional on removal or placing directors at any time

Judge: You’re just drawing attention to the fact that the lender can change the nominee?

Mr O’ Neill: Going back to the 27 October regulatory announcement..

Judge: Does this publication satisfy the requirements of the LSE [ edit: London Stock exchange] : it is headed “Regulatory Story”.

Mr O’Neill; [ If Mr O’Neill answered that question, I missed what the answer was, but there was some waffle about market rules about announcements to inform shareholders, so I suppose he answered ‘yes’]…….Having looked at 13, MASH has the right to appoint a director to the Board of the Limited Company ,over at 149, appointment of Lambias as non-executive. Lambias has been acting a consultant for 5 days and only 5 days after MASH involvement. At 7.5.153 the 12/11/14 announcement this is when MASH agreed credit facility drawdown of £2M by the PLC. Notice explanation there ‘ MASH is a shareholder in the company….”

So, we have acceptance of Lambias as Director of PLC and the Limited Company., who together own and operate the club. We can infer influence on the club.

Judge: What has this got to do with Point 3?

Mr O’Neill: All I’m saying is in terms of influence, nomination was enough to give influence.

The regulatory announcement was just part of the evidence , but there is an indication of inf…[breaks off, and finishes the sentence as ] shows that the lender put in directors in order to look after their interests. In terms of Article 13……

Judge: In the context, is it relevant to consider the procedure set up. It is quite a legal procedure: the more a decision is coming from a very legal-like procedure, the more it comes under the Courts?

Mr O’Neill: No, the opposite: the Court’s fears are even more groundless. These matters are not legal fiction. They are law. Our approach is not that of corporate lawyers, but of any lawyer.

 

I move to to have all three [motions]to be upheld, and dismissal of the Petition.

Judge: Thank you, Mr O’Neill. Mr Sandison?

Mr Sandison: As regards the ‘proper structure’ I add: Rangers FC was the business carried on by Rangers Football Club Limited.

There is NO ‘club’ separate from Rangers football Club. A ‘member’ of the SFA is Rangers Football Club Limited.NOT Rangers Interntional Football Club plc., and NOT any ‘concept’ of the club.

What RIFC plc own is the shares of Rangers Football Club limited. It does not own Rangers Football club Ltd. It does not operate Rangers Football Club Ltd, and has no ‘business’ but to own the shares. These matters are not legal fiction: they are the Law

As regards the acquiescence of Ashley. It is a fact that on this occasion he chose to take no objection to the SFA panel. My learned friend tries to draw inferences. It is not that ‘he would never refuse to accept’ did not amount to an acknowledgement of the complaint, far less its truth. He did not accept the relevance of the charge.

Next, on the import of Article 65. My learned friend sought to argue that Ashley was not a ‘member’ but an ‘interested person’, such as a player, manager and such like. BUT his connection is only as a shareholder of MASH, which owns shares in RFC Ltd..

And even if I’m wrong in that, Article 65 imposes obligations on ‘members’, and not on a person’s interests. 7.1.67 “ “ ..shall constitute an agreement to be a member..”

Judge: [reading]” Fact of membership…..” but it goes on to say “it” shall… How can it bind, say, the boy who brings on the water, or a secretary.

Mr Sandison: Because it is a ‘members’ association. The SFA , it’s an agreement of members.

So, I say Article 65 is agreement by members . Ashley is NOT a member.

As regards Public/private law, I submit that Private law matter is in the very case cited that my learned friend relies on.

Proper construction of Charge: the charge at the end is unrecognisable. The placing of a comma makes it clear that it’s simply an explanation. Not trivial: placing of a comma affects the sense. [ edit: smiles on the Bench and in the court as he mentions ‘Eats, shoots and leaves’]. In a formal document, language rules are not trivial.

If it is correct to say that the ‘club’ is some sort of ethereal being floating underneath some [edit; I think he said ‘structure’, but it might have been some other word or phrase], what on earth does that mean?

This charge is by no means to be read as [ edit: missed what he said here]…

RNS announcements are the formal means for the LSE to inform shareholders. These announcements are written by NOMAD. It is an error to state that the credit facility was for RIFC plc, Rangers, the club, the company, to draw-down. It was for draw-down by Rangers Football Club Limited.

Judge: ..Is NOMAD a Director?

[ Mr Sandison explains that the Nomad was Daniel Stewart and Company, for whom Mr Shackleton works as the appointed Nomad etc]

Mr Sandison resumes: my learned friend says 13.1 is in broad terms.

A charge in breach of 13, subject so wide, all the more reason for precise charging.

Ashley understood the charge as being against him personally. The Tribunal said that doesn’t matter, we’ll convict anyway.

The clear factual position of the petitioner is that the ‘member’ is Rangers Football Club Limited., not RIFC plc.

There are no facts that Mr Lambias being on the plc would result in a nomination to Rangers Football Club Limited. It’s a huge logical leap… to conclude that Ashley…

The witness statements, I accepted that it was open to the panel………..[edit: missed what he said]

On the final substantive point, what is a proper understanding of Article 13. The Article is an article of a private limited company. My learned friend drew on the notion of the game, football, ‘ to facilitate competition in the game of football’.

If that is the interpretation of the SFA then Ashley is at one with them.

They have come no way to establishing lack of competition by Lambias being on the Board. That would have no effect on Rangers ability to play competitively.

Proper construction of a document is not only a matter of fact, but of law. NOT for a Tribunal, but for the Court.

 

Judge: Thank you, Mr Sandison. [to Mr O’Neill] I’ll let you respond but I won’t let you talk on Article 65, the right to reply being limited.

Mr O’Neill: I will just address three points.

First, to respond to the claim that the RNS statement was misleading. If we look at 17.24-this is a letter about the RNS statement 10/02/2015, Clarification; ‘the directors consider it was not misleading’.

Second, on the claim that Rangers FC is a trading name only, and ‘no directors appointed’ I refer to 7.5.32, amendment to official return form to be used for notifying the SFA. “ Rangers FC-appointment of Lambias

Thirdly, on 65,5 point, the phrase ‘any person interested through a member ..’ What is meant is seen in 1.3.1 “ members and associated persons shall be….” Ashley is not a member, but an ‘associated person’.

 

End of proceedings.

The judge asked Counsel if they were there any special time constraints requiring an urgent decision. There were not. He would of course produce his decision as early as possible.

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