Lawyer suggests compensation to avoid disaster could cause new ‘catastrophic’ outcome at Everton

Tue 5 December 2023 12:40, UK

Paying compensation to relegated clubs could help Everton avoid catastrophe, but could bring about new worries at Goodison Park, according to Matt Stanbury.

The lawyer shared on his Twitter account (5 December) that the Toffees are reportedly looking to settle compensation claims from clubs relegated from the Premier League, during the time they were found to breach profit and sustainability rules.

Should they settle these claims it will remove the uncertainty around Goodison Park, but would impact the Toffees’ sustainability. If compensation isn’t needed to be paid, paying it in an attempt to avoid catastrophe could still lead to a catastrophic outcome.

Settling the claims removes this uncertainty, but brings its own problems in terms of the sustainability of the Club. If compensation is not required to be paid, then paying it to avoid a catastrophic outcome may, in its own way, bring about one 11/13
— Matt Stanbury (@thepubliclawyer) December 5, 2023

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Leeds United, Leicester City and Burnley were initially reported to be interested in taking legal action in a £300 million case against Everton having been relegated from the Premier League while the Toffees were breaking the financial fair play rules [Daily Mail, 3 October].

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Catastrophic outcome

It is never a good sign when avoiding one type of catastrophe directly leads to another, but it seems almost certain that this will end badly for Everton if they look to pay some sort of compensation to the relegated clubs that want to take legal action.

You don’t have to be a lawyer to realise things are going financially wrong at Goodison Park currently, with the Toffees treading a very fine line between managing their finances well and the looming threat of administration and catastrophe.

The case that the relegated sides have seems very hard to prove given the lack of evidence that the Toffees’ overspending directly resulted in their relegation. Nobody is quite sure when exactly the overspending occurred so it is hard to prove which sides it impacted.

Should Everton look to financially compensate the sides in an attempt to brush the legal action away, they would in turn almost be admitting that they were at fault for their relegations. Therefore, the likes of Leeds and Leicester would have a case against the Toffees.

In other Everton news, 777 Partners’ projection has been proven wrong following the latest broadcast deal from the Premier League