The Scottish Rugby Union is set to decide by Monday whether their dispute with Edinburgh must be fought out in court.
Edinburgh, as had been expected, failed to meet last night’s SRU-set deadline for repayment of £1.4m (€2m) in advance funding.
The SRU had told Edinburgh to find the money by the close of business, after claiming on Thursday the professional club terminated their ’operating agreement’ with the union.
The SRU insist they have written notification of the termination, while Edinburgh owner Bob Carruthers has questioned whether such an agreement even exists.
There has been little to suggest peace could be on the horizon, however, the SRU plan to consult with Carruthers as well as the union’s legal team before taking their next step.
SRU chief executive Gordon McKie said: “Our main focus now is to bring this matter to a speedy conclusion, in the best long-term interests of rugby in Scotland.”
McKie has denied planning to force Edinburgh into administration by cutting off funding to the professional club.
Edinburgh have also been ordered to leave Murrayfield, and told they have no right to train or play matches at the stadium complex, leaving them without a home.
Meggetland, home to Boroughmuir Rugby Club, has been mentioned as a possible future venue for games, as has Meadowbank Stadium.
In a statement, the SRU said last night: “Scottish Rugby confirmed today that it had not received repayment of almost £1.4m (€2m) outstanding from Edinburgh Rugby.
“In conjunction with its legal advisers, Scottish Rugby will review its options over the weekend to determine its next step to recover the outstanding funds.”
The dispute began as a row over match fees which Edinburgh claimed they were due.
It escalated when Edinburgh, owned by businessman Carruthers for the past year, pulled their 12 Scotland players out of training with Frank Hadden’s national squad for a week in early July.
Edinburgh were the first to raise the possibility of legal action, in their attempt to recoup the match fees Carruthers claims are outstanding, however the SRU maintain the situation as it now stands means it is they who are owed money.
Under the terms of the franchise agreement which brothers Bob and Alex Carruthers struck with Edinburgh in July 2006, the SRU have provided partial funding for the club.
Weekend talks between McKie and Bob Carruthers may be a last-ditch effort to resolve the row before it causes further harm to the Scottish game, with the World Cup approaching.
Edinburgh risk being forced out of the Heineken Cup and Magners League if they no longer remain affiliated to the SRU.