Yorkshire CCC emergency general meeting: 'Dissolution' of club at stake in pivotal vote

Julian Knight, chair of the Digital, Culture, Media and Sport Committee which has investigated the club's racism scandal affecting whistleblower Azeem Rafiq, today urged Yorkshire CCC members to "continue the process of the club’s rehabilitation" by backing a reform plan put forward by new chairman Lord Kamlesh Patel.

Mr Knight said: "This should be just the first step in cricket putting its house in order. Such a move however will not only secure the long-term future of the club by restoring international matches to Headingley but will act as signal to the wider cricketing world that, with the right will, strong and determined action can be taken to tackle the scourge of racism that has stained the game."

When is the emergency general meeting and why is it needed?

A high-stakes emergency general meeting is to take place at Headingley on Thursday, March 31 at 6pm - the same day as a deadline set by the ECB for club reforms to be agreed that will allow international cricket to return.

The ECB suspended Yorkshire CCC from hosting international matches in November but said in February it felt sufficient progress had been made under Lord Patel that the suspension could be lifted - meaning that a planned England Test Match at Headingley against New Zealand in June and a One-Day game against South Africa in July should be able to go ahead.

Hosting international cricket is vital to the club's finances - its most recently-published accounts showed in 2019 that from its overall £18m revenue, £10.4m came from international games. A circular sent to members earlier this month said the entire future of the club would be in doubt if Test cricket does not return.

It warned: "On the basis of independent insolvency advice and in light of the financial position of the club if Test cricket is not returned to Yorkshire, the leadership of the club will have little choice but to seek a restructuring solution and that includes the potential dissolution of the club."

However, the ECB's decision that international cricket could return came with two vital conditions - that by the end of March, Yorkshire must have resolved issues relating to rule changes and decisions which had been subject to "procedural flaws" and that club rules must be amended relating to the appointment and operation of the board, including the removal of powers currently held by the Graves Trust.

What are the "procedural flaws" concerning the ECB?

The circular sent to members earlier this month explained that an "oversight" in notifying the Financial Conduct Authority about club rule changes allowing people who had not been club members for at least two years to become board members had come to light just before it was originally due to hold the emergency general meeting in February.

That issue, which was made public by former Yorkshire CCC chairman Robin Smith, meant that when Lord Patel and club secretary and acting CEO Paul Hudson joined the board late last year, previous rules preventing people who had not been club members for over two years becoming directors still applied.

The circular said: "The existing directors knew that Lord Patel had not been a member for 24 months but mistakenly believed that the 2021 Rules were applicable. However, because of the lack of registration of the 2021 Rules, this provision was not in fact available to the Board, nor could Lord Patel be co-opted (as a co-opted member had to have been a club member for at least 24 months). Consequently, Lord Patel's appointment was invalid."

A second issue relates to that of Mr Hudson, who was appointed on December 3.

At that stage, the club had fewer directors than the four required by the rules of the club to constitute a quorum allowed to make decisions.

The circular said: "Board decisions could not be validly taken after that point. The subsequent appointment of Mr Paul Hudson on December 3 was therefore also invalid because his purported appointment was made by an inquorate board. As a result, the Board has remained inquorate since November 5, 2021. Formally, it consists of only two validly-appointed directors, Mr Neil Hartley and Mr Trevor Strain."

What are the consequences of the procedural flaws?

Yorkshire's circular to members said the existing directors and Lord Patel and Mr Hudson "have continued to act throughout in good faith and what they consider to be in the best interests of the club".

But it accepted there have been a number of "regrettable consequences" as a result of the issues. In addition to not having a properly appointed board, the directors face potential legal liability over decisions they have made in the past three months which have included a settlement agreement with Azeem Rafiq and the sackings of 16 staff members.

The circular said:

• The club does not presently have a properly appointed board. The progress of the club is therefore potentially stymied unless and until the appointment of Lord Patel and Mr Hudson can be confirmed by the members.

• The validity of the actions taken by the two validly-appointed and the two invalidly-appointed directors since November 5 2021 needs to be put beyond doubt. This generates a regrettable level of uncertainty unless and until their actions on behalf of the Club in this period are ratified by a resolution of the members.

• Because those persons were acting without formal authority as board members, they are potentially liable for the work they have done for the Club despite having acted in good faith and in the Club’s best interests throughout. The members will be asked to release them from liability by a ratification resolution.

• These matters can only be put right by a members’ resolution at an EGM. Following the receipt of sufficient member requisition requests, an EGM is now convened to put things right.

What is the Graves Trust issue?

According to the club’s most recent accounts, Yorkshire owes £14.9m in the form of three separate loans to trusts which are linked to the family of former Yorkshire and England Cricket Board chairman Colin Graves.

Under the current rules of the club, approval from the trusts is required before any person is appointed to the board of directors until those debts are fully repaid. Previous chairman Roger Hutton had raised concerns about these arrangements.

Yorkshire CCC has now reached agreement with the Graves Trusts that their current right of approval over Board appointments and Rule amendments is no longer required. The club say: "This will return control to the members and permit the Nominations Committee greater freedom to select the best candidates as nonexecutive directors."

Colin Graves himself said earlier this week that he has voted in favour of the reforms.

He said: "As a Yorkshire vice-president and member, I have voted to support the changes as outlined by YCCC to its members. I really hope that the legal advice taken by the club on these issues is sound and solid.

“The club now needs to move on, and get back to staging international matches and playing cricket at the highest level in England and Wales.”

What are members being asked to support?

Yorkshire say the resolutions have the following purposes:

• To end the potential paralysis of the board by confirming the appointment of Lord Patel and Paul Hudson as fully-functioning members of the board, and as chair and chief executive officer respectively;

• To confirm the validity of recent club decisions by ratifying the actions taken by the board since November 2021;

• To improve the transparency and oversight of the board through the appointment of a diverse range of independent non-executive board members; and

• To remove barriers to the club’s smooth operation by introducing a three-year default term of appointment and (with the Graves Trusts’ agreement) removing the Trusts’ veto over board appointments and rule amendments.

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