Linklaters and Deloitte point finger at each other on Arsenal sale lawsuit

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Arsenal share dispute rumbles on as advisers blame each other for mistakes (Source: Getty)

Magic circle firm Linklaters and big four accountant Deloitte have blamed each other for errors made in the sale of a major stake in Arsenal Football Club in 2011.

Papers filed at London’s High Court last week reveal that the pair are blaming each other for allegedly negligent tax advice delivered to former Arsenal shareholder Lady Bracewell-Smith.

Bracewell-Smith engaged the pair to advise on the sale of her 15.9 per cent sale in the club to US businessman Stan Kroenke in 2011.

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Lawyers for Bracewell-Smith argued that negligent advice from the pair led to the siting of loan notes in the UK rather than overseas, opening Bracewell-Smith up to capital gains tax liabilities, prompting her to move to Monaco.

Linklaters said that it was not responsible for the commercial terms or the tax aspects of the deal, arguing that they were the responsibility of Bracewell-Smith and Deloitte respectively.

Deloitte in turn claimed that it “did not actually know that the loan notes would be sited in the UK and did not have any duty to check.” Adding that: “Linklaters knew or should have known … because they had been retained to advise her on the legal documentation relating to the sale of her shares.”

Bracewell-Smith claims she has incurred losses of more than £10m as a result of the errors made, as well as £1,249,815 for her move to Monaco and more than £400,000 in adviser fees.

Her claim also argued that if it was not for the allegedly negligent advice she received, she may have sold her stake in the club to current 30 per cent shareholder Alisher Usmanov “or some other purchaser".

Read more: Arsenal agrees £731m Kroenke takeover

In since deleted tweets Bracewell-Smith said that she “deeply” regretted selling her shares in the club to Kroenke.

Linklaters is being advised by Clyde & Co, Deloitte by Reed Smith and Bracewell-Smith by West End firm Gordon Dadds.

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