DOCUMENTS filed yesterday in the NSW Supreme Court allege Manly Leagues Club was sold to Sea Eagles benefactor Max Delmege for $3 million less than its book value and for half an earlier offer.

Phil Franks, a northern beaches property developer and former Balmain, Norths and Penrith player, has taken action against the club for the recovery of $550,000, negotiated down from $1 million, which was the figure Franks claims was agreed if he could increase the value of the premises in order to relieve pressure from the club's bankers. The $15 million sale to Delmege, together with the re-purchase for $3.5 million of the adjacent football club premises (previously sold to Delmege) and the settlement of $10 million in debts, left the club with only $1.5 million, Franks's affidavit stated.

"There appears to be simply insufficient funds to go around," he said in the affidavit, pointing out the club had further obligations additional to monies owing to him, such as possible capital gains tax, legal and stamp duty costs, and the need to upgrade the small football club building.

Franks maintains that financial statements show an excess of current liabilities over assets of $1.125 million, a net profit of $58,000, achieved only after the sale of fixed assets of $445,000, and a negative movement of funds of $870,000 during 2007-08.

Franks argues in his affidavit he was used as a trick pony in a flawed tender process, designed to deliver the Brookvale premises to Delmege, a leagues club director.

Delmege flagged the withdrawal of his sponsorship of the Sea Eagles, before tonight's preliminary final against the Warriors, but pledged to revive it if an alternative naming rights sponsor was not found.

The court matter was adjourned until Tuesday.

Asked to comment on Franks's legal action, leagues club chief executive Peter Spray said: "I have legal advice that I am not at liberty to comment."

Franks also refused to comment.

Roy Masters