English Football Team Port Vale Get Sued by Shirt Sponsors

February 16, 2012

English Football League Two team Port Vale Football Club are feeling the heat after being sued by its own shirt sponsor over the repayment of a £125,000 loan.

Papers filed with the High Court yesterday show Harlequin Property first demanded repayment of the loan in December.

Now Harlequin is suing Vale for breach of contract for failure to repay the loan and said it has refused the chance to renew its shirt sponsorship at the end of the season as a result of the dispute.

The papers state Harlequin agreed the £125,000 loan with former chairman Bill Bratt to assist “cash flow and purchase players for the team”.

Harlequin says it agreed the loan would become repayable, and interest would begin to accrue, if control of the club’s board changed.

Mr Bratt resigned in October with Perry Deakin and Peter Miller appointed in the same month.

Harlequin acknowledges it owes Vale £51,000 as part of the sponsorship agreement and has deducted the sum from its claim. Therefore Harlequin says it is owed £74,000, plus £1,926 in interest since the board changes in October.

The papers also reveal Harlequin paid £5,000 towards the players’ Christmas party, but is not seeking that back.

If the court judges that Harlequin is properly owed the sum it would allow the company to instruct bailiffs to recover assets from the club or issue a winding up petition.

That would leave Vale with the option to repay the cash or, if the court judged the club to be insolvent and unable to pay, it could have to appoint administrators to avoid liquidation.

It comes a week after it emerged the cash-strapped club missed the January 31 deadline to pay last month’s loan payment of £19,616 to Stoke-on-Trent City Council.

The club has already twice breached the terms of the £2.25 million council deal by taking out a mortgage worth £277,000 against Vale Park and missing a deadline to file company accounts.

A spokesman for Harlequin confirmed the legal action, but said: “We are not prepared to comment on the details of the claim.

“It was hoped that discussions with the club would lead to an amicable resolution, but this was not possible.

“As a result of the current situation, Harlequin Property has declined to renew the shirt sponsorship agreement at the end of this season.”

Port Vale director Perry Deakin, said: “This is a loan that the former chairman took out quite a while ago and we’re in the process of trying to clarify exactly what the terms were.

“We’re in dialogue with Harlequin. I fully expect the matter to be resolved within 14 days.

“It will be resolved amiably, without question.”

by Ismail Uddin