13 July 2023 , 15:29
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It's not been easy supporting Scunthorpe United in recent years. Numerous off-the-field issues and multiple relegations have seen a painful descent from EFL football to playing in the National League North this coming season.
Just 12 years ago, the Northern Lincolnshire-based side found themselves near the top of the football pyramid, competing in the Championship. In 2017 and 2018, the Iron came close to a lucrative return but twice lost out in the League One play-offs.
A downward spiral began with subsequent relegations, prompting owner Peter Swann to actively seek a buyer for the struggling club which was losing millions each season.
In 2021, Swann transferred ownership of the Glanford Park ground to his company Coolsilk in exchange for £11m worth of loans that he had put into the club.
Things took a turn for the worse this January when an unpaid tax bill saw HMRC issue the club with a winding-up petition.
Ex-England star Gale preparing for future off pitch while starring for Keighley
Fortunately, in the same month David Hilton, a Nottingham businessman, arrived as the new owner, offering renewed hope for a brighter future as the crowds returned and positivity grew.
However, this soon ignited a contentious ‘civil war’ between the former and current owner, primarily revolving around the agreed-upon deal for the club’s land and ground.
As a result, the club’s future at Glanford Park has become uncertain, marked by an upcoming court case and allegations of the club 'trespassing' on the premises.
In an exclusive interview with The Mirror, both parties have shared their views on the matter, aiming to offer some transparency amid a vacuum of reliable information which has left them to fight it out on social media and message boards.
A general view of Glanford ParkFrom the end of Swann's era to Hilton's new beginning
Amid growing concerns over the future of the club, property developer and Ilkeston Town owner Hilton stepped in on January 25th as he was officially announced as the club’s new owner.
He told The Mirror: “The club was weeks away from disappearing and I saved it. There was no one else at the table at all. The local consortium had withdrawn and the other one had never provided proof of funds. There was no one who could have completed in time before the winding up hearing, the club would have been wound up.”
Initially, it was announced that the deal included the club’s land and ground, currently owed by Swann. However, it has now emerged that Hilton agreed to pay a nominal fee for the club and an additional £3million for the ground and surrounding land. The financial commitment was sustained at the time by proof of Hilton’s funds which he says he provided through insolvency firm Begbies Traynor who worked on the deal.
To facilitate thorough checks and ground searches, both parties entered into an exclusivity agreement, granting them a dedicated period of four months. This agreement, which was set to conclude on May 24th, aimed to provide sufficient time for all necessary legal processes to be completed.
Hilton explained: “What I said to Peter Swann was that there was far too much to go through and I am going to save Scunthorpe United. I don’t have time to look at the property side of things. That is going to have to go through the conveyancing process and the lawyers are going to have to work through the process to make sure everything is right.”
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Swann added: “He said he was happy with the price for the land which was £3m. He then requested a four-month exclusivity period to do the rest of his due diligence. We went forward with that exclusivity deal on the basis of that with our advisers and I believe that was signed on 27th January."
During this period, Hilton says he took steps to secure the club’s financial future by settling its debts, including paying the £192k tax bill to avoid the winding up petition and payments owed to other outstanding creditors. This ensured the survival of the club off the field but despite heavy investment in the squad, the Iron couldn’t avoid relegation from the National League.
By early April as the property searches progressed, Hilton proposed a change in the terms of the deal which was rejected by Swann. Soon after various issues had come to light through Hilton’s lawyers which prevented the already complex deal from reaching completion.
Hilton and his legal team raised concerns about the land’s valuation, a portion of unregistered land, issues created by expired planning permission, challenges related to land access involving a local farmer, and uncertainties surrounding the ground’s status as a community asset. These issues meant Hilton did not complete the agreed-upon January deal so the ownership of the land was due to revert to Swann at the end of the exclusivity period on 24th May.
Scunthorpe United fans haven't had much to cheer in recent yearsAt the same time, Hilton announced plans to build a new, alternative stadium in the town centre. Talks with the council are underway and he has expressed hope that the club will be able to move within two years.
Combined with an ongoing dispute over proof of funds and a severe breakdown in relationships between the two parties, Scunthorpe United are facing fresh uncertainty as the new season approaches.
Football Finance Expert Kieran Maguire is worried about the situation, telling The Mirror: "Scunthorpe have operating losses exceeding £27 million in the last decade and paid on average £140 in wages for every £100 of income during that period.
"The shortfall came from Peter Swann's pocket, which meant that the club's sustainability and future was reliant on him continuing to subsidise the losses. His relationship with David Hilton is clearly a frosty one and the potential consequences are concerning"
Explaining Hilton's 'lease' for Glanford Park
Despite the expiration of the exclusivity deal and the looming prospect of eviction, the football club remained at the ground after the May deadline.
In response to the issues faced over the ground and land, Hilton says he has been devising a contingency plan for the club. He claims his legal team informed him of a potential legal loophole - a lease that Hilton had acquired during the four-month agreement, which could offer temporary respite and enable to club to stay at Glanford Park for the time being.
He claimed: “We found a loophole, they had not put a standard requirement into the lease which means you could potentially give the club a lease. I spent a lot of money coming up with a contingency plan to keep the club at Glanford Park as long as possible.
“My lawyers told me to give the club a lease, he’ll come and sue you for his losses but I wasn’t bothered. My only priority was to protect the football club. He threatened to sue me and sent the letters but I knew it was the right thing to do.
“It’s just a rolling week-by-week lease as that would stand up better to keep us in there. The lease itself is irrelevant. What the lease gives the club is the landlord and tenants rights that I didn’t have as they hadn’t signed out of them, like I had when I signed the deal in January.
“The club now has the lease and that’s why Swann can’t get us out and will have to take us to court to do so.”
Peter Swann with former Scunthorpe manager Graham Alexander in 2017The court battle on the horizon
Swann is now seeking to get the club to vacate the ground with land possession proceedings filed at Leeds High Court.
"We are applying to him to honour the contract. He’s there under trespass, pretty much squatting," he claimed.
“Hilton has issued himself a lease, a 7-day periodical lease and we believe that was unlawful and we will contest that. In the agreement, it was stated that he couldn’t sublet or assign anything so it’s pretty straightforward for us.”
Swann also expressed concern about the Iron being able to start the season at Glanford Park due to a lack of tenure for the ground, which he says is a requirement for the National League.
He explained: “Can you imagine if it goes to court, taking perhaps four or five months but in December Scunthorpe are top of the league, doing really well but then they have no ground to finish the season. The National League cannot allow them to stay even for four or five months.”
However, Hilton disagrees with this view and claims that a deal is already in place with the National League to fulfill their games this season. Furthermore, if the club was forced to leave the ground, Hilton says he has an agreement signed with a local non-league side to host Iron matches, which he claims has also been approved by the National League. The Mirror has asked the National League about these comments but didn't get a reply.
“We have a plan B option to play at another club which is signed and it has been agreed by the National League. So If the worst happens and Peter Swann wins the case, we would still get promoted this year!" Hilton explained.
“That was one of the first things I did and the league has been working with us."
Confidence with both parties
The first court date now looms for Scunthorpe United as Swann plans to issue an injunction against the club with the case expected to be heard within a month or so.
That move could potentially result in the Iron being forced to vacate the land and consequently leave their ground. However, Hilton remains optimistic that the judge will rule in Scunthorpe’s favour considering the potential consequences of eviction against the club.
“My solicitors have advised me that it's very unlikely that the high court would give him an injunction given everything that has happened,” he explained.
“There’s so much going on and so much to sort out with a 120-year old club, there’s no way he will get a high court injunction to kick us out, knowing that it will potentially cost people jobs and local companies money, plus the impact on the local community.”
New Scunthorpe United owner David HiltonOn the other side of the ownership battle, former club owner Swann believes his argument regarding the lease is a solid one.
“This is a really strong case for us,” he claimed.
“We’re confident we will win in court, our lawyers would not go and do this if we didn’t think we were right. He has breached the lease, he should never have sublet or assigned it and there were other ways this could have been done.”
Should Scunthorpe successfully navigate the initial injunction case, the next step will involve a lengthy eviction court process, which both parties acknowledge could take several months before reaching court. If the eviction is eventually granted, the club will be required to vacate the ground immediately.
However, Hilton believes that even if such a situation was to arise, the majority of the Iron’s game could still be played at Glanford Park this season.
He said: “If they find in our favour at the injunction, my lawyers are 99% certain we’ll win and let the club stay where they are and let it go through the normal court procedure for eviction.
“That will take him between six to eight months at the minute, with Christmas sandwiched in between. That will pretty much allow us to see out the season. That’s why I did this and hopefully, fans can understand why.”
Scunthorpe United are set to start the new season in the National League NorthNew deal on the table
In response to Swann’s recent statement on a fan site, Hilton has now put forward a new proposal for the land and ground, hoping to break a deadlock in the legal battle.
The revised deal, reviewed by the Mirror, involves Hilton agreeing to pay the original sum of £3million for the ground. Additionally, he will pay rent towards the stadium while his legal team works on finalising the agreement for the land and resolving any outstanding issues.
Hilton stated: “The morning after his statement came out I emailed Peter through his lawyers with a new deal. I have offered him as originally agreed £3 million and I will pay him £10k a month in rent, which is double what the rent currently is while it goes through the lawyers. I have also said I will provide proof of funds through his lawyer again.”
“The only thing I ask from him is that he has to let it take its time and due process through the lawyers. He cannot try to rush it through in desperation and put timescales on it. It may be done in three months, it may be done in six months but it can’t be against a timer which will cause more issues”
“Accept the offer on the basis that the lawyers will work as quickly as they can but it has to go through the legal process. All these bits that need to be overcome are looked into and sorted out so the club is protected and I am protected. I will give you the £3 million and £10k a month rent when it goes through the lawyers.
He added: “I have done everything I can but Swann has put ridiculous boundaries up to stop it from happening. I’m not going to part with anything until I know I am protected.”
However, Swann has already rejected the latest offer, stating that he wants to see proof of funds and income from Hilton, and is only considering an upfront offer of half the originally agreed amount.
“I have to stick to the £1.5m upfront,” Swann said. “I took a mortgage out with the majority of that used to support the club as I had no choice. I have to pay that off and that would be paid using the land.
He added: "David owns the club but he has nothing else, he doesn’t have a freehold and doesn’t have the stadium. He can move that everywhere he wants and if he wants a new stadium that’s fine, but he isn’t staying at the ground"
The legal battle for Glanford Park appears to be an ongoing dispute with no resolution in sight, casting a shadow over the upcoming season for Scunthorpe United.