Herefordshire Council won't fight for Hereford United debt in court

Council confirms that it won't fight for its Hereford United debt in court

Council confirms that it won't fight for its Hereford United debt in court

First published in News
Last updated
Ledbury Reporter: Photograph of the Author by , Reporter

HEREFORDSHIRE Council will not fight in court for what it is owed by Hereford United saying the debt doesn’t affect the authority’s “financial viability”.

United escaped liquidation again at the High Court this week, but Herefordshire Council is still not on the list of those owed.

The council is landlord to the club’s Edgar Street ground but was not put to the court as a creditor of Hereford United Football Club (1939) Ltd despite being owed around £65,000 in rent arrears, business rates and legal fees.

However, the council was listed as a creditor during the attempt by the club to set up a Company Voluntary Arrangement (CVA).

But the council took no part in the CVA as it considered that other creditors were likely to be more affected by the outcome.

Defending its stance in a statement, the council said the amount owed would not affect its own financial viability as opposed to smaller creditors, where the amount owed could be the difference between remaining in business or not.

The statement confirmed that the council has not joined in the current legal proceedings by other creditors seeking the winding up of the club. 

 But, if those proceedings are successful, the council will recover the same percentage of the debt owed as the other unsecured creditors.

A recent memo sent to councillors said that following the rejection of the Company Voluntary Agreement (CVA), the council’s position over the club had not changed.

That position had the council not making any move over the leases on Hereford United’s Edgar Street ground until the outcome of Monday's hearing was known.

The council is already under pressure from members to hold an “official investigation” into the authority’s part in the crisis at Hereford United.

There have even been calls for an outside agency to investigate any culpability the council may have.

The council has already admitted that no “separate” due diligence report was done on the financial state of Hereford United ahead of the ground leases being re-assigned.

Instead, members have been told that an “appropriate level” of due diligence was carried out given that the club was a current tenant.

Meetings and telephone conferences between council representatives and representatives of Hereford United have gone on since January without minutes being taken.

 

Comments (20)

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11:28am Wed 3 Sep 14

AndyM442 says...

Absolute cowardice from Herefordshire Council. They don't have the backbone to take decisive action on any matter.

People joked when the Supporters Trust called on Councillors to not transfer leases that doing nothing was what the Council did best. Now it seems it's the only thing they are capable of.

Tony Johnson should resign if he cannot make decisions.
Absolute cowardice from Herefordshire Council. They don't have the backbone to take decisive action on any matter. People joked when the Supporters Trust called on Councillors to not transfer leases that doing nothing was what the Council did best. Now it seems it's the only thing they are capable of. Tony Johnson should resign if he cannot make decisions. AndyM442
  • Score: 10

12:10pm Wed 3 Sep 14

Cambridge fan says...

This isn't an easy situation for the Council, as they don't want to be seen to put the club out of a home and out of business,. Yes, I do understand everything that is said about the club in it's current situation, but it's not the council's job to judge the suitability of the current incumbents to run the football club and act accordingly. How would everyone have reacted had they taken action, say, in the middle of last season? I'm not surprised that the council are sitting tight for the current days and weeks in full knowledge that they have ownership of a piece of real estate with a value of, what, £10 million.
For supporters there is a greater game to play, as I feel the future of the club (whatever 'club' means) is dependent upon retaining Edgar Street. The task of setting up a Phoenix club would be much harder if it is starting life without a home, so be careful what you wish for.
I, for one, am glad that Herefordshire Council aren't playing hard ball and that they are showing flexibility towards the club, something that will auger well for the long term future of football in Hereford.
I would like to add that as a Cambridge fan I have been following this from a distance with a feeling of 'but for the grace of god', I hope things work out for all Hereford supporters.
This isn't an easy situation for the Council, as they don't want to be seen to put the club out of a home and out of business,. Yes, I do understand everything that is said about the club in it's current situation, but it's not the council's job to judge the suitability of the current incumbents to run the football club and act accordingly. How would everyone have reacted had they taken action, say, in the middle of last season? I'm not surprised that the council are sitting tight for the current days and weeks in full knowledge that they have ownership of a piece of real estate with a value of, what, £10 million. For supporters there is a greater game to play, as I feel the future of the club (whatever 'club' means) is dependent upon retaining Edgar Street. The task of setting up a Phoenix club would be much harder if it is starting life without a home, so be careful what you wish for. I, for one, am glad that Herefordshire Council aren't playing hard ball and that they are showing flexibility towards the club, something that will auger well for the long term future of football in Hereford. I would like to add that as a Cambridge fan I have been following this from a distance with a feeling of 'but for the grace of god', I hope things work out for all Hereford supporters. Cambridge fan
  • Score: 15

12:11pm Wed 3 Sep 14

Densell says...

So a council that is over £200 million in debt and is cutting back services like grass cutting to save a few thousand pounds here and there will not pursue a debt of £65,000 that it is owed. Can the council clarify up to what amount wouldn't affect their financial viability and can we then have services that have been cut reinstated to that amount? These people make my blood boil, they should not be in charge of a child's piggy bank, let alone a multi million pound budget. If they were to actually leave their gold plated jobs and go and work in the private sector they would not last 2 minutes!
So a council that is over £200 million in debt and is cutting back services like grass cutting to save a few thousand pounds here and there will not pursue a debt of £65,000 that it is owed. Can the council clarify up to what amount wouldn't affect their financial viability and can we then have services that have been cut reinstated to that amount? These people make my blood boil, they should not be in charge of a child's piggy bank, let alone a multi million pound budget. If they were to actually leave their gold plated jobs and go and work in the private sector they would not last 2 minutes! Densell
  • Score: 24

2:00pm Wed 3 Sep 14

yokelyokel says...

Can I assume that if I don't pay my council tax the council will also come to the conclusion that the relatively small amount of debt wouldn't affect its financial viability?
Can I assume that if I don't pay my council tax the council will also come to the conclusion that the relatively small amount of debt wouldn't affect its financial viability? yokelyokel
  • Score: 35

2:32pm Wed 3 Sep 14

DaveyJonesLocker says...

Herefordshire Council = Absolute Joke

They can waive £65000 debt but they would soon be hounding normal people like you or me for money if we had a parking ticket or hadn't paid our council tax.

They moan that there's no money in the pot, yet they say that a £65000 debt owed to them wont affect their financial viability. Come on HC you really are joking aren't you!!??

The sooner you are gone next year the better.
Herefordshire Council = Absolute Joke They can waive £65000 debt but they would soon be hounding normal people like you or me for money if we had a parking ticket or hadn't paid our council tax. They moan that there's no money in the pot, yet they say that a £65000 debt owed to them wont affect their financial viability. Come on HC you really are joking aren't you!!?? The sooner you are gone next year the better. DaveyJonesLocker
  • Score: 25

2:51pm Wed 3 Sep 14

littlewhitebull says...

Football at this level is a business. I am a great fan of the Bulls (although not the present regime) .
The council is owed money by the club and it should pursue the debt as it would any other creditor, or non-payer of council tax.
Money used by the council is that provided by the tax payers. The council must not let sentiment get in the way of its execution of legitimate business.
If I decide to pay money to watch football matches that is my privilege; I do not expect taxpayers to subsidise my leisure activities.
Football at this level is a business. I am a great fan of the Bulls (although not the present regime) . The council is owed money by the club and it should pursue the debt as it would any other creditor, or non-payer of council tax. Money used by the council is that provided by the tax payers. The council must not let sentiment get in the way of its execution of legitimate business. If I decide to pay money to watch football matches that is my privilege; I do not expect taxpayers to subsidise my leisure activities. littlewhitebull
  • Score: 32

4:46pm Wed 3 Sep 14

phil Morris says...

So this Council dont want to get the debt paid to them then, Short of monies then, rubbish, if they are not going for the debt of HUFC, dont hound me for parking tickets and council tax. The council members get paid for meetings, but what do they do at them then ? Play cards, have a drink ? Nor wonder this is the worst Council in the UK, TRY TALKING about the debts, get the monies in and Get grass Cutting, filling holes up in the road. You lot get paid for attending meetings, so DO something. I have no faith in our council.
Come on Council Members, stop playing cards at your meetings, get the debts in and Spend it on this city.
So this Council dont want to get the debt paid to them then, Short of monies then, rubbish, if they are not going for the debt of HUFC, dont hound me for parking tickets and council tax. The council members get paid for meetings, but what do they do at them then ? Play cards, have a drink ? Nor wonder this is the worst Council in the UK, TRY TALKING about the debts, get the monies in and Get grass Cutting, filling holes up in the road. You lot get paid for attending meetings, so DO something. I have no faith in our council. Come on Council Members, stop playing cards at your meetings, get the debts in and Spend it on this city. phil Morris
  • Score: 11

4:46pm Wed 3 Sep 14

Steve Harris 1957 says...

I feel there are so many factors involved now, the Hereford public have no idea just how deep this all goes. I've read time and time again how this current regime are going to pay this and pay that, yet money is still outstanding in huge amounts and the little people as well as the HMRC are still kept waiting.

It may sound like the council are considering the little guys in this statement but in the long run, I think it can only get worse for them. Surely the council have an absolute duty to chase monies owed (think about any other situation, not much consideration for the little guys then is there?)

Ignoring the fact that the council are no doubt obliged to check out the credentials of people they deal with for a minute, surely the FA and other bodies involved should not have allowed this to go so far given the background of these people, now in charge.

The biggest question that concerns me now is that of leases and who stands to benefit from them. It's as if there is more to all this than meets the eye, I just hope the council havn't cocked up and somehow handed the reigns to the current regime (accidentally or otherwise)!
I feel there are so many factors involved now, the Hereford public have no idea just how deep this all goes. I've read time and time again how this current regime are going to pay this and pay that, yet money is still outstanding in huge amounts and the little people as well as the HMRC are still kept waiting. It may sound like the council are considering the little guys in this statement but in the long run, I think it can only get worse for them. Surely the council have an absolute duty to chase monies owed (think about any other situation, not much consideration for the little guys then is there?) Ignoring the fact that the council are no doubt obliged to check out the credentials of people they deal with for a minute, surely the FA and other bodies involved should not have allowed this to go so far given the background of these people, now in charge. The biggest question that concerns me now is that of leases and who stands to benefit from them. It's as if there is more to all this than meets the eye, I just hope the council havn't cocked up and somehow handed the reigns to the current regime (accidentally or otherwise)! Steve Harris 1957
  • Score: 14

5:09pm Wed 3 Sep 14

Holmerowan says...

Question to the council
How did you allow HUFC to run up debts to a staggering £65.000
That sort of sum can't just be a few months of debt but must be over a few years. Who authorised such allowed levels of debt for HUFC ?
Remember its the taxpayer's money were talking about here.
An independent in depth investigation is needed. Because the whole affair with Edgar Street stinks of incompetence and possible corrupt dealings.
Question to the council How did you allow HUFC to run up debts to a staggering £65.000 That sort of sum can't just be a few months of debt but must be over a few years. Who authorised such allowed levels of debt for HUFC ? Remember its the taxpayer's money were talking about here. An independent in depth investigation is needed. Because the whole affair with Edgar Street stinks of incompetence and possible corrupt dealings. Holmerowan
  • Score: 17

5:46pm Wed 3 Sep 14

redyoll says...

Perhaps they are insured for bad debts and simply are not saying.
Perhaps they are insured for bad debts and simply are not saying. redyoll
  • Score: 4

5:48pm Wed 3 Sep 14

WYSIATI says...

My initial reaction - chase the debt and get the money back - what so often is forgotten (mostly by companies milking contracts and people suing) is that public money is exactly that - yours, mine, rich and poor - it's not a free lunch for anyone.

But when you look a bit closer - if the club is wound up then the council gets paid pro rata with everyone else so no point in forcing the issue and cutting off any other options.

Maybe they are being sensible on this. But I would not want to see good money thrown after bad and the taxpayer deserves a good deal here.

The responsibility for getting into debt surely lies with the club, its owners and management I can't see how its the council's fault.
My initial reaction - chase the debt and get the money back - what so often is forgotten (mostly by companies milking contracts and people suing) is that public money is exactly that - yours, mine, rich and poor - it's not a free lunch for anyone. But when you look a bit closer - if the club is wound up then the council gets paid pro rata with everyone else so no point in forcing the issue and cutting off any other options. Maybe they are being sensible on this. But I would not want to see good money thrown after bad and the taxpayer deserves a good deal here. The responsibility for getting into debt surely lies with the club, its owners and management I can't see how its the council's fault. WYSIATI
  • Score: 4

6:30pm Wed 3 Sep 14

greenknight says...

Just when you think you have heard it all. Truth is HUFC as it currently stands is making an enemy of its own people! Perhaps this money could have been used f o r a just cause ..roads ,social care, local transport...the list is endless. The council should recover our money, the club should fall on its sword and a new club with a clean history start from the bottom and earn its stripes the hard way! If the council is savvy it would sell the assets surrounding the ground and use this to invest in business and ultimately more jobs! If the council feels charitable they could find a place for the new club to make its mark. It's time to end this.
Just when you think you have heard it all. Truth is HUFC as it currently stands is making an enemy of its own people! Perhaps this money could have been used f o r a just cause ..roads ,social care, local transport...the list is endless. The council should recover our money, the club should fall on its sword and a new club with a clean history start from the bottom and earn its stripes the hard way! If the council is savvy it would sell the assets surrounding the ground and use this to invest in business and ultimately more jobs! If the council feels charitable they could find a place for the new club to make its mark. It's time to end this. greenknight
  • Score: 15

7:44pm Wed 3 Sep 14

drowssap says...

What are hereford council on hufc owe 65K and the won't chase it,anybody late paying their council tax twice and your summonsed and they want the lot. My question is do the powers that be get a financial gain by being so lenient with them. I think a vote of no confidence should be brought against them.
What are hereford council on hufc owe 65K and the won't chase it,anybody late paying their council tax twice and your summonsed and they want the lot. My question is do the powers that be get a financial gain by being so lenient with them. I think a vote of no confidence should be brought against them. drowssap
  • Score: 19

11:00pm Wed 3 Sep 14

Brownface60 says...

Much as I love football in Hereford, it is unreasonable to expect all council taxpayers to subsidise the club by letting it get away with not paying what it should. The Council must get back what it is owed - from whoever owes it - to pay for services for all of us. Other contributors are absolutely right - there should be no double standards in getting what is owed.
Of course the leases are still an issue - any profits made from redevelopment should go into the council pot. This will protect and improve services. The leases should not provide money to line the pockets of asset strippers from outside the county, some with perhaps dodgy pasts, and with a sudden and very convenient enthusiasm for Hereford football!
Much as I love football in Hereford, it is unreasonable to expect all council taxpayers to subsidise the club by letting it get away with not paying what it should. The Council must get back what it is owed - from whoever owes it - to pay for services for all of us. Other contributors are absolutely right - there should be no double standards in getting what is owed. Of course the leases are still an issue - any profits made from redevelopment should go into the council pot. This will protect and improve services. The leases should not provide money to line the pockets of asset strippers from outside the county, some with perhaps dodgy pasts, and with a sudden and very convenient enthusiasm for Hereford football! Brownface60
  • Score: 12

8:27am Thu 4 Sep 14

Chaltis says...

I have no axe to grind on the subject of HUFC, but I believe the Council has an obligation under the various Local Authority Acts, to recover any and all debts it is owed. Not doing so would make the Council liable for complaint and prosecution.
I have no axe to grind on the subject of HUFC, but I believe the Council has an obligation under the various Local Authority Acts, to recover any and all debts it is owed. Not doing so would make the Council liable for complaint and prosecution. Chaltis
  • Score: 11

9:17am Thu 4 Sep 14

Steve Harris 1957 says...

Another interesting issue pertaining to payments is the alleged non-payment to current players! When is the list of people chasing money going to end? As things stand, the money owing is increasing all the time. With rumours of non-payment of (players) accommodation as well as wages, what else is going to surface? Surely the HMRC bill must be growing as well?
Another interesting issue pertaining to payments is the alleged non-payment to current players! When is the list of people chasing money going to end? As things stand, the money owing is increasing all the time. With rumours of non-payment of (players) accommodation as well as wages, what else is going to surface? Surely the HMRC bill must be growing as well? Steve Harris 1957
  • Score: 6

9:59am Thu 4 Sep 14

mizza21 says...

Good Lord the dealings between HUFC and the council over the past few years gets murkier and murkier.
I wonder what the council have weighed up here.
Perhaps they do not want certain things coming out in court which may cause significant embarrassment.
Perhaps they are worried about Jonathan Bretherton's name and Hereford Futures role in the demise of the club being raised in court.
Good Lord the dealings between HUFC and the council over the past few years gets murkier and murkier. I wonder what the council have weighed up here. Perhaps they do not want certain things coming out in court which may cause significant embarrassment. Perhaps they are worried about Jonathan Bretherton's name and Hereford Futures role in the demise of the club being raised in court. mizza21
  • Score: 10

10:57am Thu 4 Sep 14

AndyM442 says...

There seems to be a veil of secrecy surrounding Mr Bretherton's role and the dealings he signed off. Maybe a full Police investigation, as has already been called for by some Councillors, will be the only way to find out the truth with so many seemingly keen to hide their roles in Herefordshire Council's operations.
There seems to be a veil of secrecy surrounding Mr Bretherton's role and the dealings he signed off. Maybe a full Police investigation, as has already been called for by some Councillors, will be the only way to find out the truth with so many seemingly keen to hide their roles in Herefordshire Council's operations. AndyM442
  • Score: 12

1:44pm Thu 4 Sep 14

Mr.Herefordian says...

I am surprised regarding the above comments we should all know by now that our Cabinet does what it likes and couldn't care less about what we think. Maybe as some are jumping ship in next years election and the rest I would think would not be elected again is the answer.
I am surprised regarding the above comments we should all know by now that our Cabinet does what it likes and couldn't care less about what we think. Maybe as some are jumping ship in next years election and the rest I would think would not be elected again is the answer. Mr.Herefordian
  • Score: 3

6:25pm Thu 4 Sep 14

wyesider says...

I have heard the council refer to itself as 'cash-strapped' and that the council needs to make every penny count during these difficult times of cutbacks.
The amount owed by the football club is a significant amount by any standards when so much is being cut from budgets.
I have heard the council refer to itself as 'cash-strapped' and that the council needs to make every penny count during these difficult times of cutbacks. The amount owed by the football club is a significant amount by any standards when so much is being cut from budgets. wyesider
  • Score: 16
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