The only major case on it is Inland Revenue v Wimbledon Football Club Ltd & Ors  EWHC 1020 (Ch) in which the Inland Revenue attempted to argue that the Rule breached s.4(4)(a) Insolvency Act 1986 in that it provided for a third party to make payment of football creditors ahead of their preferential debts. They failed on grounds that appear to be nothing to do with the Rule. However, from reading this case and the appeal, there is much to still be investigated about this Rule.
Rules 47 and 48 of the Rules of the Premier League state:
Power to Deduct
47. If any Club or Relegated Club (“the debtor Club”) fails to make any payment due to any creditor of the description set out in Rule C.48, upon being reasonably satisfied to that effect, the Board shall be empowered to deduct the amount of any such payment from any distribution of UK Broadcasting Money, Overseas Broadcasting Money, Commercial Contract Money, Radio Contract Money or Title Sponsorship Money payable to the debtor Club, paying the same to the creditor to which it is due.
48. The creditors to which Rule C.47 applies are:
Another way of looking at C55 in particular is to consider it as a trust with the board as trustees with discretionary powers. In that case, if the assets of the debtor are held in part on trust for a creditor, is that another form of security from the point of view of the creditor? Is it a setoff issue instead?