Bunnies Fight Over Leagues Club Loan
By Brad Walter
SMH – 25/03/2006
A DISPUTE over more than $300,000 that the new privately run South Sydney football club claims is owed to it from an outstanding debt is set to cast doubt over the future of the Rabbitohs leagues club.
In a dramatic sequel to the battle for control of Souths that resulted in Russell Crowe and Peter Holmes a Court last Sunday being granted a 75 per cent stake in the football club for $3 million, George Piggins yesterday vowed to fight all the way to court if they now attempt to call in the 10-year-old loan he described as "a book entry" only.
With the Rabbitohs planning to move their football club offices from the third floor of South Sydney Leagues Club to Homebush Bay when Crowe and Holmes a Court formally take over on May 1, the situation is about to hit flash point.
Piggins said the football club had already asked for the money late last year, but Souths football club chairman Nick Pappas said no formal demand had yet been made.
However, Pappas expects the new board of the football club, which will be headed by Holmes a Court in his role of executive chairman, to take such action in the immediate future and was unable to say what would happen if the leagues club can not or will not pay.
"No formal demand has been made for the money at this stage but if a decision is made for the football club to move out of the leagues club then I would anticipate that happening," Pappas said.
"I imagine that it will happen fairly soon. It's a matter of need, the football club needs that money and has done so for some time. It is too big an amount to write off.
"This whole exercise has been about the football club's need to assert its financial independence and if that involves calling in a loan from the leagues club then so be it."
According to Piggins, the leagues club borrowed $600,000 from a $2.5 million grant to clubs loyal to the Australian Rugby League by Optus during the Super League war to help cover a shortfall in paying for a commercial project. In return, the football club received free rent on its office space in the leagues club indefinitely.
"It was a book entry and anyone who was involved with the football club and the leagues club at the time knew that," said Piggins, who controlled both clubs until three years ago and is still chairman of the leagues club.
"It was never supposed to be repaid in cash, the football club received free rent and after 10 years I think it might have been more than repaid anyway but that didn't matter. It was the leagues club helping out the football club. Nicholas Pappas knows all about that because he defended us over this issue during the court case against the Murdochs, but now he's got a different opinion on it.
"The football club has already had one go at getting their hands on the money three or four months back. [But] I'm comfortable that it's not a real loan and I'm comfortable that a court of law would recognise that if this was to go that far."
But Pappas countered: "It is a real loan, there is no doubt about that. There are entries in the books of both the leagues club and the football club."
Inflaming the situation is the fact that Holmes a Court has been banned from entering the leagues club - and, therefore, cannot gain access to the football club offices - after being accused of trespassing when he took a Channel Nine news TV crew on a tour of the building's empty second floor to highlight what he alleged were the shortcomings of Piggins's management.
Piggins said Holmes a Court, whose initial offer was for $11.5 million and included buying the licensed premises, had been sent a letter asking him to appear before the board of the leagues club.
Meanwhile, the Rabbitohs have received applications from 360 potential new football club members since last Sunday's decision to accept the offer from Holmes a Court and Crowe. A number of new sponsors have also come on board and a shorts sponsorship deal is close to being finalised.
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