Brian reads the contract!

Dire Straits: O what a tangled web we weave…

These last few days have seen a sudden spate of information from the Club. Complex documents with figures and claims have landed in the collective inbox.  Let’s take a look.

Why isn’t the Club going back to Queen St.

First we got the President’s 13 March 2020 letter finally admitting the obvious – the Club won’t be returning to 316 Queen St. He blames everyone but himself as usual.  This time it’s all the fault of Beulah and his own lawyers.  You have to wonder just how happy his lawyers are going to be about this. He is essentially accusing them of writing an unenforceable contract. Supposedly the builder has committed major failures in meeting contractual obligations. The President cites these as the reason for the Club not returning to Queen St. and the lawyers have advised not fighting it.

What was the Committee, and the lawyers, doing in all these many years of secret, confidential, prolonged, intense negotiations over the contract when one of the breaches the President cites is “failure to provide lifts to the Club other than the goods lift.” ?

Labelling this a breach of contract would be so much more convincing if the contract of sale did not state in paragraph 1.1 that a ‘cold shell’ is defined as:

Definitions section of the Sale Contract

This definition appears in both the Sale and Purchase Contracts. So the President has known about the lifts issue since 2016.  Why is it a problem now? If Committee’s crack negotiating team missed it, why didn’t his renowned international lawyers, paid $59,164 in the most recent financial year, explain the definition to them?

Will the President now admit that the ‘no-sale’ group were right? Selling the building has exposed the Club to massive losses – $13 million and counting – and has left it with no suitable place to call home. Is it time to climb down and admit that he was wrong?

Two summaries of expenditures

Then we have two versions of the ‘Summary of Major Celtic Club expenditures..’ Seriously, nothing absolutely nothing, instils confidence in the audience like a financial summary which has to be corrected in a matter of days! Doesn’t the President check his figures before he sends them out?

The second version of the expenditures is still wrong.  The first item labelled ‘4% Stamp Duty’ is NOT stamp duty.  As he recently bought a lovely home in Ballarat, surely the President would know:

  1. The vendor is not liable for stamp duty
  2. Stamp duty is not a Commonwealth tax.

This item has already been queried by concerned members who practise as property lawyers. In any case the 4% represents the Club’s craven agreement to pay the Foreign Purchaser Additional Duty on Beulah’s behalf as per clause 24 of the contract:

24 Price Adjustment

At settlement, the Vendor must pay to the Purchaser an
 amount equal to 4% of the Purchase Price plus or minus
 adjustments (as applicable).

The President agreed to the price adjustment because the ‘Foreign Purchaser additional duty’ (a state tax) increased by 4% after 1 July 2016. It was the foreign purchaser – Beulah – who were liable (https://www.sro.vic.gov.au/foreignpurchaser). The President gave a vast foreign multinational land developer a gift of one million dollars because he was so desperate to sell the Club’s only real asset. So they never got the much touted $25.6 million – they only got $24.576 million.

The fact that the Capital Gains Tax (NOT in fact GST) was paid in 2019 shows that the decision not to move back to Queen St was made last year, not in March 2020 as pretended.  The deposit – now returned – should not be included in the total cost because the Club has got it back.

So will this mean that a third version of the expenditures is issued? We wait with bated breath.

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