The possiblity of legal action

I have had a pro bono consultation with Jeremy Marshall of Bracher Rawlins, a London law firm. This note must not be taken as definitive advice, but is intended to let you know which way the wind blows.

1. In the likely event of legal action such as calls for a judicial review of the Northern Rock nationalisation bill and the basis of the share valuation, it may not be possible for the assessors to start working on a valuation of the shares until the turn of the year.

2. Further legal action when a value is announced seems likely. The Government may make come under pressure to make an an interim payment to shareholders. But if they offer something as full and final settlement , ex shareholders will have to think carefully before accepting - because if court action resulted in more money, those who've taken full and final wouldn't get anymore.

3. Jeremy has approached the lawyers for the largest shareholder to see if they would be interested in joining a few small ex shareholders in this action (and at their cost). Their lawyers are considering this, and their strategy may emerge shortly.

4. There might be a legal case against the discredited former directors, but ex shareholders have lost their focus. It's down to the owner - the Government - to pursue them. This may be a campaign strand, and we'll be running a poll on the issue on the blog (www.nrssg.blogspot.com) to test your opinion.

5. Talking of which , the final vote was over 80% thought that a fair compensation level for our expropriated shares was 438p or more.

6. And on the subject of legal action, the UK Shareholders Association is still planning this, and would run a financed appeal. We'll keep you informed about this. Please let Robin Ashby know separately whether you would be willing to make a financial contribution and if necessary allow yourself to be joined in future legal action.

7. I have (belatedly) received a letter from Bryan Sanderson, the former Chairman , "I was very grateful and encouraged to receive such overwhelming support from the Small Shareholders at the recent EGM."

With best wishes,

Robin Ashby