Initial court proceedings have already taken place between the Ibrox club and Glasgow-based Levy & McRae over a bill understood to be around £35,000 and dating from earlier this year.
The bill was for advice given to Rangers on how to handle the Uefa investigation into sectarian singing at Europa Cup games against Dutch side PSV Eindhoven. Rangers were fined €40,000 (£35,652) by Uefa in March and its fans banned from the next away European game for sectarian singing in the match in Holland with PSV. The club also received a suspended ban on its fans for a second away game, for a probationary period of three years.
The latest financial woes to hit the Scottish champions have emerged as former owner Sir David Murray made clear the businessman he sold Rangers to, Craig Whyte, was “fully aware” of an outstanding tax liability of £2.8 million before buying the club.
On Friday, the same day a preliminary hearing in the Levy and McRae case was heard at the Court of Session in Edinburgh, Rangers had £2.8m seized after an arrest order was issued to the club’s bank over an unpaid tax bill. The order was delivered on Thursday following an application by Her Majesty’s Revenue and Customs (HMRC). The club’s bank then acted by putting the money into a holding account
Levy and McRae, which provides legal advice to many of Scotland’s leading newspapers, including The Herald, is also representing former Rangers chief executive Martin Bain in his breach of contract case against the Ibrox club.
Sources close to both parties have told The Herald the legal action is a clear indication that relations between the club and its previous lawyers had broken down irrevocably, with one claiming: “Rangers were furious when Levy & McRae took on Martin’s case.”
Although the bill dates from the dying days of the Murray era, Rangers under Mr Whyte, who bought the club for a nominal £1 in May, are still liable for the money, the law firm has claimed.
Peter Watson, senior partner at Levy & McRae, said: “We don’t wish to comment while the case is progressing through the courts.” A spokesman for Rangers also refused to comment on the case.
Meanwhile, Sir David has insisted that the new owners knew of the outstanding tax bill before May’s takeover.
A spokesman for the Murray Group said: “Craig Whyte and his advisers were fully aware of the £2.8 million tax liability before buying the club. The liability was included in our accounts for the six months ending on December 31, 2010.
“In fact, specific provision was made and assurances given by Mr Whyte that funds were in place to enable him to pay that.”
The liability includes approximately £900,000 of interest on a bill of £1.9 million stemming from deals that were done during Dick Advocaat’s reign as manager.
But HMRC has also hit Rangers with a £1.4 million late payment fee, which the club is disputing, taking the total bill to £4.2 million.