Llangollen Railway

Sadly there were many cases of ad hoc groups being formed to purchase a prized heritage asset with little or no thought given as to how it would be owned and who would be responsible for it. Many of these groups were unincorporated so could not legally own assets in their own right or conclude agreements as the group for hire/use of their stock ( although it didn't stop some from mistakenly believing that they had such enforceable contracts). The reality is that legal ownership would vest in committee Members or Trustees to own the asset on express or implied trust for the others. Sometimes individuals thought they were purchasing "shares" in the asset whereas in reality they were simply making donations. The other downside of unincorporated status is that individuals can be liable without limit and without any right of contribution from other group members or expectation that they will be indemnified. So if, for instance, a coach owned by such a group must have asbestos removed the entire cost could fall on one member. In the rush to preserve some made "investments" that are not asset backed and may have naively taken on potentially life changing financial exposure.

 

I strongly agree. I'll extend that further - and observe that whenever any business fails, there is always a focus on the damage to it but too little on the businesses that lose out when their bills can't be paid, and the jobs that are at risk as a result.

 

I don't believe that the LR Trust is the "guilty" party in all this.
Ray.

 

I would hope that every Board already has access to a decent lawyer that they regularly consult for anything that may have legal implications.

 

When I was in debt recovery I learned that it's all very well winning your case at court, but before starting legal action, make sure there is money at the end. Otherwise you end up with nothing but a Pyrrhic victory.

 

The Trust must bear some responsibility - the PLC was its legal responsibility and the Trust should have had oversight of what the PLC was up to and what is was liable for. If the PLC directors did not disclose the true position to Trust officials then they presumably could be sued - unless of course the two Boards were essentially the same people in which case the new Trust Board should be chasing after them! I doubt if resignations would protect them, but I think we can take a stab at guessing why so many have resigned! I wonder how many have been busy transferring assets to their uninvolved spouses!

 

The Trust and the PLC are intrinsically linked with the former being the major shareholder in the latter, holding 23.2% of the shares according to the latest published accounts.

The failings of the engineering department have not happened overnight, they have been happening for years. Whilst the trust is not the direct cause of the issues, the representatives of the trust would’ve known about the PLC issues and would’ve been involved in decisions that have been taken as a result.

Which elements of the Llangollen Railway family is/are responsible is not really relevant. The family as a whole could be argued as being jointly responsible. The fact of the matter is however that the issue has been at the Llangollen end. There is no question however about the innocent parties, they are the groups who have paid for a goods or service, not received what they purchased, had to resort to legal proceedings (which didn’t happen without issues trying to be resolved behind closed doors first) which wouldn’t have been taken lightly, and are now trying to minimise their losses.

I’m confident that this whole situation has unfortunately risen due to mismanagement rather than something more intentional. All involved were trying to benefit the railway one way or another, but unfortunately it’s now a lose-lose situation all round.

 

And that profit would go into the scrap-man's pockets - is that who people want to benefit? (Not that I have anything against scrap-men, per se; oddly enough, my dad was one aeons ago.) Not bidding on the assets only harms the Llangollen and their creditors; for them to get the fair, true, full value of the assets being sold is ultimately in everyone's best interest.

Noel

 

The Festiniog slate waggons were not private owner but were all owned by the company. The colour markings just indicated which quarry they were allocated to (and who owned the slate) and allowed them to be directed to the appropriate wharf at the other end.

 

Also, finding out where the scumbags have hidden their assets is a very vital skill. County Court bailiffs weren't, in my experience, the sort of guys to extract the gold from a debtor's teeth, let alone one of their kidneys to sell off to someone who needed a transplant.

 

I was under the impression that the Trust board had changed in recently. No one is denying the mismanagement (and I have commented on it before.) It isn't about who is the wounded party but about what is good for the industry as a whole in terms of culture and ethos, and because I think the sector as a whole is better with a stronger Llangollen Railway than without. (The same goes for if this were any other line).

Irrespective of that, I don't really think asset stripping (which is what this is) is something to be welcomed because this situation could arise at any line.

If it were a case of a.n.other railway bidding against the scrapman then that makes sense, if it were a.n.other railway bidding against Llangollen, I don't think that is very good collective behaviour, especially in a small industry such as heritage.

 

Given the need to sign a nda, I don't think anyone outside the process knows who's bidding. So it would actually be best for other railways to have expressed an interest, to stop the stuff going to the scrapman, surely? Esp given the railway aren't exactly awash with funds?

 

Considering there has been much made of asking members to bid on some assets, it is probably a fair assumption they have put a scrap price + 10% (or similar) bid on anything of huge value (it would be foolish not to). As has been said many time now, I don’t think there is any serious risk of the MK1s going for scrap.

Maybe if the administrator decides the PLC have a reasonable claim to ownership of some of the scrapyard condition wagons, and after advertising them can’t find a buyer. Then these might go to scrap, but at the moment the administrators are struggling to find value, so will probably think twice before selling some of the few things (MK1s) of value at scrap price.

Maybe this conversation is also highlighting why there is some anger amongst LR volunteers/members that the former directors have all so quickly moved on to other railways taking their locos/new build/auto coaches/MK1s with them.

 

Yes it is, but at the same time do we know that the scrapmen are the alternate bidders? That seems like a bit of a get out clause.

I can accept the reasons for others bidding but that doesn't necessarily mean that I think that it is a good thing collectively or something pleasant.

 

The scrap metal market is quite unsentimental be it in ferrous scrap or precious metal. I recall a well known T.V. antiques specialist referring to the time when an extreme spike in silver prices led to good Georgian pieces being melted. Unless by prestigious makers or of unusual design, the scrap value of silver items is what they are worth. I don't know if, away from the excitable world of the railway enthusiast, old railway carriages are worth more than their scrap value. However, those selling off these vehicles will have no option but to accept the best offer.

As I said quite unsentimental!

 

At the 1994 auction following the closure of Chatterley Whitfield Mining Museum the 16T mineral wagons sold for scrap for considerably more than the going scrap rate . The unsubstantiated rumour at the time was that the '16 Ton' description had been misinterpreted by the buyer,

Jon

 

Yes very unsentimental. However as been said numerous times in this thread the going rate for a decent MK1 far exceeds scrap value, so this won’t be a concern.

 

I might be a bit out of date with this but I think scrap metal is somewhere around £150 a tonne. I believe a MK1 weighs about 35 tonnes.

Are people seriously suggesting there aren’t 10-12 buyers out there willing to pay more than £5-6k for a decent MK1?

 

I wonder if any of them will find their way back on to the main line with rail tour companies.