SCOTLAND ON SUNDAY REPORTS

Edinburgh Rugby and SRU remain poles apart as debacle hits court
MARTIN HANNAN
COURT action is under way in the long-running dispute between the Scottish Rugby Union and the privately financed Edinburgh Rugby Ltd.

Scotland on Sunday can reveal that caveats have been lodged at the Court of Session by Edinburgh Rugby. These are legal devices designed to ensure that Edinburgh Rugby is immediately informed of any action in the court by the SRU. Edinburgh Rugby's owner, Bob Carruthers, confirmed yesterday that lawyers for the club had lodged the caveats following newspaper reports that the SRU were contemplating actions which he described as "a pre-emptive strike" against the club. "When we saw that the SRU were planning to move against us, it seemed the only appropriate course of action to us was to lodge the caveats," said Carruthers.

This paper reported last week that Edinburgh Rugby was preparing two writs against the SRU, one for £250,000 and the other for £5m.

A last-minute plea for mediation by Carruthers was turned down by the SRU. Carruthers was insistent yesterday that the problems between the governing body and the club could be resolved "within a week to ten days".

He is concerned that the preparations for the World Cup by the Scotland squad should not be affected by the continuing impasse between the SRU and Edinburgh Rugby.

Scotland on Sunday has obtained evidence to show that the two sides are nevertheless further apart than ever before. The SRU is hampered by the fact that none of chief executive Gordon McKie, chairman Allan Munro or finance director Eamon Hegarty is able to speak on the record to the press. They have been advised by the SRU lawyers not to make any reportable comment in advance of what most observers think is an inevitable lengthy court action. Carruthers, however, has been able to state matters on the record and it is mystifying how the two sides can take such a different view, especially after so many matters have been put into the public domain. There is also no question of any SRU comment being in contempt of court as this is a civil and not a criminal case, and it is a fundamental principle of Scots law that a judge cannot be influenced by any participant in a court action.

Until the SRU do comment on the record, they are bound to be at a disadvantage in the propaganda war being waged by the two sides. This paper's report last week regarding the details at the heart of Edinburgh Rugby's case against the SRU are unlikely to be discussed by the Scottish Rugby Council, the body which oversees the SRU's board, when it meets on Thursday.

Council members are not entitled to see the contracts and documentation signed on behalf of the SRU by its executives, although it is understood that some members will raise questions on the performance of the board in the matter of Edinburgh Rugby.

This paper further understands that the SRU is playing down the significance of the issues of the late payment of money due to Edinburgh Rugby from the Heineken Cup and Magners' League last November. It is the alleged lateness of that payment, and a shortfall of £194,000, which led to Edinburgh Rugby bringing the action.

The SRU consider the lateness issue to be irrelevant, and something which happens in businesses from time to time. This is despite the explicit clause in the contract which states that the money would be paid on November 30, when in fact it was not paid until December 4. Edinburgh Rugby is also questioning an alleged problem with VAT payments, but again the SRU will maintain that this was an irrelevant technicality. The SRU may find it rather more difficult to sustain its position that the resignation of Hegarty from the board of Edinburgh Rugby was not linked to the payment problems in November. Hegarty resigned on December 7, and Edinburgh Rugby wrote to him four days later in very strong terms about his directorship.

With the affair now in the courts, it appears that, unless wiser counsel prevails in the next few days, Edinburgh Rugby and the SRU face a long and costly battle in Scotland's Court of Session.

This article was posted on 22-Jul-2007, 07:42 by Hugh Barrow.