The High Court this week solved a knotty problem: what do you do with the land owned by a club that has long since stopped meeting, has few existing records, and all the trustees are dead?
A question that is made more thorny by the fact that it is situated on land originally bought for less than £20,000 that is now worth almost 20 times more.
The club in question was formed by a group of railway workers in Chesterfield, Derbyshire, possibly as early as the 1960s and run for 30 years from the 1980s as a sports and social club for railway workers and their families.
It bought one plot of land from the local council in 1986 for £7,500 and another, upon which it built a clubhouse, from British Railways for £19,125 in 1990.
The second plot is now worth £390,000.
The club, although it never formally dissolved, has not met since at least 2013, the club’s records are in “disarray” and there are no provisions as to what should be done with the club’s assets on dissolution.
Although it has been used for car boot sales, the clubhouse is now derelict, and the executors of the club’s trustees have been left with the problem of what to do with it. The local council has offered to manage the land and let the local residents’ association use it.
However, the case ended up in the High Court, where Mr Justice Roth gave his ruling this week.
After considering all the authorities, he ruled out the council’s suggestion.
“I do not know if the council took any legal advice on the matter,” he wrote in the judgment, “but I see no basis as a matter of law principle whereby the property of a dissolved club could either pass to a wholly distinct club or association with different membership or be held on trust by the council,” he said.
He ruled that the club was dissolved in 2013.
“It seems to me clear that the land should now be sold. There is no benefit to anyone in it being retained.”
But what should be done with the money? “The only real asset of the club is the land… and that was acquired a long time ago. I shall therefore… direct that, when sold, the net proceeds should be divided between those who were members as of March 2013, or their estates.”
There were around 25 members at the time, although she said there should be a “mechanism” set up for claimants. Legal costs, he ruled, should be paid from the sale of the land.
