The Kids Company founder Camila Batmanghelidjh “kicked back” against trustee attempts to impose financial controls in the months leading up to the charity’s collapse, the High Court heard yesterday.
Richard Handover, a former Kids Company trustee and ex-WHSmith chief executive, was being questioned by Lesley Anderson, on behalf of the Official Receiver, about the period between November 2014 and the first few months of 2015.
The OR is seeking to secure disqualification from senior positions for periods of up to six years against Handover and six other trustees, plus former chief executive Batmanghelidjh, after the charity collapsed in 2015.
The court heard that Handover and other trustees had insisted staff adhered to restrictions imposed on expenditure at the end of 2014 – namely that trustee approval was needed before new financial commitments were made.
Anderson suggested that a series of emails sent by Batmanghelidjh showed she was “kicking back” against some of these proposals.
But her skeleton argument contests that she battled to hold the charity together in the face of insubordination, rumour and misinformation.
Anderson put it to Handover that the fact the board of trustees was meeting at five day intervals throughout December 2014 was an indication of how serious a time this period was for the charity.
“We were concerned, absolutely,” replied Handover.
Anderson also suggested that Batmanghelidjh turned up at one such meeting uninvited, but Handover could not remember whether she had been invited or not.
Handover’s skeleton argument said it was not a surprise that such tensions should arise at the time, given the structure of the charity.
The issue of the charity’s structure also came up in a series of questions about Adrian Stones’ appointment as director of human resources in April 2013.
Anderson said that one of the issues Stones identified was “a flat organisational structure” that meant some people felt they reported directly to Batmanghelidjh.
Handover said: “It became less flat as we grew and we tried to get the right directors in place[…] we tried to strengthen the senior management team.”
Anderson said this attempt was undermined by the time Stones and two other directors left in early 2015.
Handover said it was true that by this time there had been a breakdown of some of the relationships in the organisation.
But Anderson suggested this was not just a falling out, but was indicative of structural problems that had Batmanghelidjh at the centre.
The obligations of trustees in relation to the finance committee was also highlighted by Anderson in an email exchange about wording that Handover was a part of.
She put it to the former trustee that language used to describe those responsibilities was “watered down” in a way that represented a “diminution from standards as set by the Charity Commission”.
Handover said the wording was a reflection of their role as unpaid non-executive directors.
Previous sessions had examined problems with payments to self-employed contractors and paying payroll late in November 2014.
Handover conceded he became aware of these issues later on.
“I said to the finance team that every attempt should be made to pay on time,” he added.
Last week, the court heard that “payroll was a struggle every month” at the charity.
The 10-week trial continues.