due diligence sprang to mind when iread that, hypothetically speaking what are the implications of something not being declared / uncovered, professional negligence ?

Hypothetically speaking, when I sold my business it was on the firm (and contract binding) provision that myself and our Leeds team were to continue running the business as a subsiduary of the Birmingham based purchasers - if after successfully completing several months worth of negotiations and contracts I had suddenly revealed something that I had previously had knowledge of that inevitably would result in my and my teams dismissal, then at the very least I would expect my purchaser to come after me for compensation, at the very least for the substantial legal fees that they picked up the tab for.

Due diligence can be used by either the purchaser or the seller to verify the material facts of a transaction but is more usually the responsibility of the buyer to undertake this audit. Lawyers acting for the purchaser should include a 'full disclosure' clause in the contract to cover not just the financial elements but also any potential or pending legal actions that may effect the valuation or viability of the business.

Hypothetically speaking, and purely as an example you understand, when you sold your 'place of purveyance' known as "Ye Olde Cake Emporium" had you not disclosed the possibility of any impending legal action brought by say, the family of a late customer who demised after eating some of your 'fermented curd comestibles' you may have been liable to pay compensation.

I am not sure if failing to declare something seriously negative when there is a full disclosure clause in the contract could also be construed in law as fraud. If there is no 'full disclosure' clause in the contract it may prove difficult to win compensation unless it could be proved to have materially effected the valuation seriously or it incurred future liabilities that would have effected the valuation.

Maybe in this case it is only the former board members themselves who will be held responsible rather that the club. However if the club becomes liable for any fines and legal costs then the new owners could seek compensation from the former owners. It is usually very difficult to value 'goodwill' in a business purchase

The only other thing I'd add into the mix is never under estimate the vanity aspect of wanting to own a sporting club, whereas in a "normal" commercial world "normal" business heads would tear up a contract and sue the [iars[/ie off a seller who had withheld information (in our hypothetical example), the "normal" rules of doing business seem to go out of the window when sporting clubs are involved, Premier League football to one side there aren't too many sporting club owners who are in it to make another fortune, most of them usually find that they end up spending the fortune they had made "normally" in order to massage their egos each and every match day.

Let's hope Mr H does not have to cover financially Mrs H out of our salary cap headroom!

You are worthy of better comments than this. I doubt if these two Yanks you mention are even aware of any of the issues I have commented on let alone share an opinion, so your comparison is odious. I may disagree with, but still give respect to your outdated and discredited socialist/marxist viewpoint. But I would not resort to likening your postings to those of Stalin just because we disagree. 0/10