As widely publicised, Buckingham Group ceased work on the East Stand project at Northampton Town, for a second time, at the end of May 2015 for reasons of non-payment by our client County Developments Northampton Ltd (CDNL).
CDNL is a company jointly owned by Northampton Town FC Chairman David Cardoza and his father Anthony Cardoza.
Naturally, the current status of this project, the finances of the football club, and the position in relation to a £10.25million council backed loan extended to the football club has been attracting a great deal of local interest. Recent press and online reports have contained several inaccuracies relating to the construction contracts. Therefore, in order to assist in delivering accurate information to the Football Club’s Supporters, Buckingham Group has this week issued the Supporters Trust with a detailed statement setting out the history of the respective contracts under which Buckingham Group has been engaged at the stadium.
In summary, Buckingham Group has been paid a total of £442,000, net of vat, by its initial client 1st Land Limited.
1st Land Limited had been in receipt of significant proportions of the public loan monies through its client, Northampton Town Football Club.
This initial contract stalled as a result of a dispute between 1st Land and the Football club, at which stage Buckingham Group was owed £1.85m. At the end of March 2015 Buckingham reached agreement with David Cardoza to return to Sixfields to recommence work on the East Stand. This agreement was based on assurances that there were adequate, additional, Public Loan Monies that remained available to fund the completion of the East Stand Works.
A new JCT Contract was signed with CDNL to complete the East Stand and we returned to Site to resume work in April 2015. Under this new arrangement, CDNL also accepted liability within the contract to pay Buckingham the outstanding debt left owing by 1st Land Ltd.
As stated, monies due under this contract were not paid on time in May, and as a result Buckingham Group suspended work at the end of May 2015. Despite certificates being issued for the design, construction and procurement work undertaken, to date no monies whatsoever have been paid by CDNL under the contract. For the avoidance of doubt there has been, and is, no dispute at all in relation to the performance of Buckingham Group under either of the two construction contracts.
Inclusive of an element of VAT, CDNL is currently liable to Buckingham Group for circa £3million for works completed and certified on the East Stand and for the debt that CDNL took over from 1st Land. This explains why Buckingham Group is engaged in legal action against CDNL and will continue to pursue all possible legal avenues to recover monies owed to it.
This regrettable situation has arisen through what we can only conclude is the gross mismanagement and/or the misappropriation of a very significant public loan by those in receipt of that loan. The loan sum advanced to 1st Land Ltd via Northampton Town Football Club was approximately double the value of the original construction contract for the East Stand work.
In addition to legal recourse, Buckingham Group is working co-operatively with other innocent parties such as the clubs supporters who may ultimately become victims of these unprecedented circumstances, the likes of which Buckingham Group has never experienced previously.
In spite of this situation, Buckingham Group’s finances remain in a very strong position. We are a £400million per annum contracting business, with a balance sheet exceeding £16 million, that has grown successfully and continues to operate by re-investing and retaining a significant proportion of its profits, which enables us to operate on a largely self-financed basis. Appropriate provisions have been made for the possible outcomes of the East Stand contracts, which could take a considerable period to be resolved, but which are having no significant impact upon our finances or ongoing operations.