In yet another case of insolvency issues ravishing sport, Queensland Rugby have clashed with Brisbane Roar Soccer Club in the Court room.
On 24 July 2015, Queensland Rugby Union (QRU) Limited filed winding up proceedings against Brisbane Roar Football Club Pty Limited. The matter is listed for directions on 19 August 2015. It is understood that a consent to act has been obtained from a liquidator.
It is alleged that Brisbane Roar owe the QRU approximately 12 months of outstanding rent payments for the use of Ballymore Stadium. If Brisbane Roar do not make the payment, QRU will seek to have liquidators appointed to the Company – potentially resulting in the end of one of the most successful teams in the A-League’s history.
The solvency of the Brisbane Roar club has been in question for some time, with numerous media reports indicating payment obligations to players and staff had not been met. Following the resignation of former managing director Sean Dobson, long time major sponsor The Coffee Club announced they would not be renewing their sponsorship.
The owners of the club, Indonesian The Bakrie Group, have been attempting to sell the club for the last month. While the Group announced their intentions to sell the club, they have assured creditors that all debts would be met through the sale process. The Group have been extremely critical of the action taken by QRU in filing to have the club wound up, stating that such action may “scare off” any potential buyer – and ultimately detriment the position of creditors.
This is not the first time that solvency issues have caused problems for clubs in the A-League – with Newcastle Jets being placed in administration in May 2015. The FFA have been operating the club since the appointment of administrators.
As was the case with the Jets, it is possible that Brisbane Roar will lose their A-League licence as a result of an act of external administration. It is yet to be seen whether the FFA have the financial power to operate two clubs at once.
An interesting time in the world of insolvency and sport surely awaits.
For the more information contact ERA Legal.
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