Minutes of Part 2 of the Committee meeting held at 1100 on Tuesday 9 January 2024, via Zoom
Present
Committee members:
Andy Martin (AM) Chairman
John Dalglish (JD) Secretary
Colin Rayson (CR)
Peter Barnes (PB)
Crown Golf and St Mellion Management:
Paul Stephens (PS)
Thierry Delsol (TD)
Robbie Smith (RS) Finance Director
Matthew Pressman (MP) Resort Director
Kirstine Hitchcock (KH) Operations Manager
Stephanie Latham (SL) Time Share administrator
Minutes of Previous Meeting
The last meeting had been held on 27 June 2023. The minutes had been approved by email after the meeting. Actions 1 and 3 from the meeting had been overtaken by events and would be addressed at this meeting.
Purpose of This Meeting
An agenda had been sent out by PS prior to the meeting, along with copies of the Crown Golf group structure, draft statutory accounts for the year ending 31 March 2023, management accounts for the period ending November 2023 and the latest version of the time share occupancy grid.
The committee would review the documents and for clarification of any data, where required. Principal aims of the meeting were to discuss the consolidation process and strategy for time share owners, who do not wish to move lodge or week, also to agree the way forward for the delayed 10-year Review.
After some initial IT glitches, the meeting convened with all participants at 1115.
Introductions
The Time Share committee members briefly introduced themselves, explaining their links to St Mellion as time share owners.
• AM – chairman, owner for 28 years along with family members.
• JD – secretary to the committee, owner for 7 years but has relinquished membership from end of March 2024.
• CR – owner for 36 years, with intention to pass on lodge ownership to family members.
• PB – retired GP, owner for 20 years.
AM explained that the committee numbers had declined recently from 6 to 4, coincidental with the large reduction in time share members. The committee constitution states that there should be 6 members but 4 is now considered appropriate, with a minimum of 3 in attendance for quorum purposes.
The new Crown Golf personnel introduced themselves.
• TD – has worked in golf and leisure industry for 30 years. Set up a company with PS called Aravis Leisure, which is an advisory and management company, specialising in the Wellness and Golf industry.
• PS – has worked with TD for many years. See above.
• RS – having worked on the accounts at Crown Golf for many years, took over as Finance Director after predecessor Andrew Merritt left in September 2023. Intention is now for St Mellion finances to be fully integrated into the company structure.
• MP, KH and SL are all known to the committee. SL was welcomed back from her recent period of maternity leave.
• MP is due to leave post at the end of January 2024. A recruitment process is ongoing.
Corporate Structure
PS added some flesh to the outline corporate structure provided to the committee before the meeting (see email with att.). The Bennelong Foundation comprises 3 parts, of which Broadbat Pty Ltd is the key player as far as St Mellion is concerned. Broadbat owns all of Crown Golf Ltd, consisting of all 9 golf clubs in the UK owned by Crown Golf. Within the structure the property company grants a lease to the operating company to run the business. In the case of St Mellion an additional entity is St Mellion Property Management Ltd.
TD and PS are both directors of Crown Golf, together with Chris Marshall, who is a Non-Executive Director. TD makes regular visits to St Mellion, usually monthly. TD explained that there will be times when he and PS will need to consult Jeff Chapman in Australia on certain decision making. Jeff Chapman is one of 6 members of the foundation board and is the dominant personality in the board room. The long term aim of the foundation is to realise its assets and distribute them to charity.
St Mellion is the top-ranking golf course within the Crown Golf portfolio. The owners and directors appreciate it has been through a turbulent time since Covid-19 and it is still not profitable. There are more positive signs recently but it is costly to run, e.g. the site uses more energy than the rest of the golf clubs put together.
Accounts
RS stated his intention to file the accounts within a week, as they are already late. In response to a couple of questions, RS clarified that the item described as Other Debtors on P6 under 2023 related to VAT and Corporation Tax due and pre-payment of business rates. On P7 the discrepancy between the amounts accrued under the heading of Turnover in relation to Time share buyout income is explained by virtue of the fact that 2023 was a break year in the scheme, where owners had the option to surrender their leases at no or minimal cost.
Finally, RS confirmed that the heading of wages in the statutory accounts is synonymous with the heading of salaries in the P&L presentation.
It was agreed that the statutory accounts and up to date P&L for current year should be sent to time share owners in February along with the calling notice for the next Annual Meeting.
Lodge Occupancy Grid
AM: Projected loss for current year is about £21k. At last meeting we had agreed that retention of 7 lodges was not viable, 5 would be too tight to accommodate majority wishes and 6 should be feasible – subject to a financial examination. This has not been confirmed, however, by management. MP acknowledged that the business was aiming for 6 lodges as a solution and that is the working assumption for KH. AM added that we want to be on a stable footing with the consolidation process complete for next year and handing surplus lodges back to the hotel. There are 9 identified non-movers.
After some discussion regarding viability of asking people (again) to move lodges to enable principle of 6 lodges to be realised, the meeting recognised, as affirmed by MP and KH, that we are left with 9 non-movers, despite numerous attempts to persuade owners to accept alternatives without disadvantage to themselves. The peak summer weeks are the main stumbling block, especially Weeks 30-33.
CR gave the meeting some background to the reason why he had not signed the Deed of Variation set up in 2018. There was some distrust of the then Crown Golf management team handling the issue, also there was no discernible benefit to CR and family. CR would be willing to reconsider in the future, depending on the conditions – too many negatives at the time.
AM considers there could be deals to be made with owners. TD accepts it will take something to unlock the current impasse, some compromise. So far St Mellion have tried persuasion with owners but not made any “offers”. AM urged everyone to think about this before our next meeting.
On the subject of non-responders, KH will ask SL to contact them by telephone, once she is back up to speed.
On the subject of debtors, AM expressed the view that non-payers should hand back their leases. MP said that St Mellion, on legal advice, cannot simply kick out debtors. They would have to be taken to court.TD suggested that they use the small claims process, supported by PS, whose experience in such instances is that people do not usually respond and the judge invariably rules in favour of the plaintiff. In his view we should press ahead with this initiative. All agreed with CR that we should not ignore these debts and should seek to recover the monies, or leases.
KH explained that the previous Finance Director had a full list of offenders, which he had sent to the company’s solicitor. KH has access to this list and can re-send if required. PS confirmed that St Mellion would initiate this process via their solicitor.
10-year Review
JD read out the relevant paragraph from the last minutes for the benefit of the meeting. Bottom line is that the review is inextricably linked to the issue of consolidation, as it will impact on the scheme’s finances.
There was much discussion about the future viability of the scheme and what a new 10-year review should aim to achieve. The following key points emerged:-
• Numbers have declined in past few years from over 900 to the accepted “hard core” current total of 124; last year was an exit year, which saw numbers reduce from 258 to 124; this figure should remain set (KH)
• It is not yet clear what number is palatable to ensure the scheme remains viable in the future (MP and others)
• The last 10-year review was not implemented in full, viz. refurbishment programme (AM); of necessity, recent history has been more about maintenance than improvements, for which there has been no spare funds (RS and MP)
• Owners expect to pay an annual fee increase linked to RPI but including a programme of scheduled improvements (CR)
• Under the Deed of Variation, 5-year break options were introduced, when members could exit the scheme for a fee of 3 x the annual maintenance fee of their lodge (JD)
• A number of debts were historically written off and a significant portion of the revenue from initial sales under the Deed of Variation scheme, expected to be allocated to the St Mellion Time Share Owners’ account, were not accrued to the account – a substantial sum – exacerbating the shortfall of funds available for a refurbishment programme (Secretary’s note)
TD agreed that the scheme need to be made more viable but considered a solution by the end of March this year unlikely. A good compromise would be to set an RPI-linked increase for next year and create a plan for the following 10 years. In effect, deferring the 10-year Review by one year (RS). This would give time to work out a refurbishment budget for the lodges.
AM thought this to be a good compromise and suggested asking owners for suggestions for future improvements. KH reminded the meeting that invoices need to be sent by mid-March, as owners should have 21 days’ notice to pay their fees (SL). Payment needs to be made by owners before first lot of owners arrive in April to take up their weeks (KH). CR agreed that this move made sense.
Action: TD and PS to put the proposal to board members in Australia, to defer the 10-review by one year and issue invoices for 2024-25 with a fee increase predicated on the annual RPI figure as per the time share lease. Subject to green light, St Mellion will communicate decision to owners.
Date of Next Meeting and Annual Meeting
The date of the next meeting will be 20 February 2024 at 1100.
Action: St Mellion to issue invitation to all for Zoom meeting.
The date of the next Annual Meeting will be Friday 22 March 2024, to be held at St Mellion. Detail for the meeting will be agreed at the meeting on 20 February. AM asked that the technology be enabled so that members can join the Annual Meeting via video conferencing means.
John Dalglish )Secretary)