Glasgow & West Scotland

Rangers administrators face £28.9m damages claim

Administrators David Whitehouse (left) and Paul Clark prepare to address the media Image copyright SNS Group
Image caption David Whitehouse (left) and Paul Clark handled the administration process at Rangers

The liquidators of Rangers Football Club plc have launched a multi-million pound legal action against the company's former administrators.

The claim has been lodged by BDO against Paul Clark and David Whitehouse of accountancy firm Duff & Phelps at Edinburgh's Court of Session.

BDO are seeking up to £28.9m following Clark and Whitehouse's handling of the administration process.

Duff & Phelps said they were surprised and disappointed.

Rangers entered administration in February 2012.

Four months later, the company's business and assets were sold to a consortium led by Charles Green for £5.5m.

BDO were then appointed as liquidators, and have since conducted a review of the events leading up to administration through to the sale of the assets.

In November 2014, BDO agreed a settlement for £24m in a claim against Collyer Bristow, the legal firm that acted for Craig Whyte in his purchase of Rangers Football Club plc from Sir David Murray in May 2011.

'No other option'

Those funds were added to the creditors' pot, as will any monies raised from the legal action against Clark and Whitehouse.

In a statement, BDO said: "The joint liquidators, following extensive deliberations with their professional advisors and the liquidation committee, have taken the decision to issue a claim against the former Rangers' administrators Paul Clark and David Whitehouse, of Duff & Phelps.

"During the course of the liquidation, questions have arisen regarding the strategy previously adopted by the former administrators, which have not, to date, been adequately answered.

"In seeking clarity, the joint liquidators have been left with no other option but to pursue the matter via the Scottish Court. The joint liquidators look forward to the resolution of this matter."

BDO added: "The joint liquidators consider that the former joint administrators failed to take actions which would have reduced costs during the administration period and realised additional value from the company's assets over and above that obtained from the sale of the business and assets to Sevco."

David Whitehouse, Duff & Phelps managing director, has described the move as disappointing.

He said: "We were surprised to receive notice of proceedings today, one week before expiration of the limitation period, and we are disappointed that this has been leaked to the media.

"In essence, BDO is now alleging that as the former administrators we should have achieved a better return for creditors by selling the clubs assets on a piecemeal basis, including Ibrox and its playing squad.

"This is a strategy with which we fundamentally disagree both in terms of its deliverability and its relevance to achieving the statutory purpose of administration.

"We will be consulting with our legal advisers in order that our position is set out fully before the court. Any further comment at this stage would be inappropriate given that there are now live proceedings."

Criminal charges against Clark and Whitehouse relating to their involvement with Rangers Football Club plc were dropped in June 2016.

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