VB Football Assets (VBFA) v Blackpool Football Club (Properties) Ltd & Ors

The court may appoint a receiver by way of equitable execution where the demands of justice require it and ordinary enforcement methods present a practical or legal hindrance. The jurisdiction is flexible but must be carefully controlled. The applicant must provide evidence explaining why existing enforcement methods are inadequate. A receiver should not be appointed where the order would be fruitless, but may be appointed where there is a reasonable prospect of assisting enforcement and it is the only realistic short-term prospect. The court may extend the order to all assets within a mixed class where separating assets would create uncertainty and disputes.

The petitioner sought the appointment of receivers by way of equitable execution over assets belonging to the first and second respondents. A judgment debt exceeding £25 million remained substantially unsatisfied despite charging orders and orders for sale. The assets included real property, shares in the first respondent, shares in Closelink, and assets connected with the operation of Blackpool Football Club.

The central issues were whether ordinary execution methods presented sufficient hindrance or difficulty, whether receivership would realistically assist enforcement, and whether the order should extend to assets for which the evidence was less specific.

1. Applicable test. The court adopted the formulation in Cruz City 1 Mauritius Holdings v Unitech Ltd [2014] EWHC 3131 (Comm) at [47]. The overriding consideration was the demands of justice. The jurisdiction was not unfettered, but could develop incrementally and was not confined to historical equitable circumstances.
2. The court required a hindrance or difficulty in using ordinary execution methods. The hindrance could be practical or legal, and all the circumstances had to be considered. Appointment was just and convenient where enforcement by other means would be difficult and receivership offered the only realistic short-term prospect. The order would be inappropriate if it were fruitless, although a reasonable prospect of assisting enforcement was sufficient.
3. The evidence did not adequately explain why receivership would improve enforcement against the non-footballing assets. The application was therefore refused in that respect. Submissions and inferences from tenancies could not replace proper evidence.
4. Receivership was justified for the shares in the first respondent and its assets because a sale of the football club as a going concern could not realistically be achieved through ordinary orders for sale alone. The order extended to all the first respondent’s assets because separating footballing from non-footballing assets would create uncertainty and disputes and make the order unworkable.
5. The risk of cost and a possible league points deduction did not outweigh the interests of justice. The evidence was insufficient to show that receivership over the Closelink shares would provide an advantage over ordinary enforcement, so that part of the application was refused.