On arrival at a Premier League commission of inquiry into his club's affairs, the Tottenham chairman had praised Venables as a potential World Cup winner. The man he sacked last summer was the best candidate for the job, he said. Once inside, however, it seems he took a different tack. By all means England should have his erstwhile partner as manager, but if Venables was to be given a clean bill of health over his spell as Spurs' chief executive, the club would have to have one, too.
Sugar's warning was taken sufficiently seriously for the FA to abandon plans to install Venables in time for the European Championship draw in Manchester on Saturday.
Sugar, according to his spokesman, Nick Hewer, saw it all as a matter of 'natural justice'. Hewer said: 'Alan's view is that if Venables is appointed manager of England he is cleared of any breach of FA rules, and then it is only fair that the club is cleared, too.'
Alan Watts of Herbert Smith, Sugar's solicitors, said: 'Should Venables be cleared and Tottenham not, then Tottenham would ask for our advice on what legal redress they would have against the FA, and legal action could not be ruled out.'
Graham Kelly, the FA's chief executive, last night accused Sugar of trying to cloud the two issues, and said he would not succeed. The five- man sub-committee responsible for hiring England's new manager was still unanimously behind Venables as 'the best man for the job'.
They prefer to regard Tuesday's setback as no more than a temporary hindrance, and there was a suggestion last night that the obstruction could be overcome by hiring Venables for the rest of the current season, with his position to be reviewed as soon as the Premier League's verdict is to hand.
In Kelly's estimation, that will be a matter of weeks rather than days. He could not 'recall precisely' what Sugar had said to him on the day the FA drew back from an early appointment, but did remember the computer magnate mentioning his solicitors, Herbert Smith.
After a lengthy pause to gather his thoughts, Kelly said: 'He mentioned putting me on notice that Herbert Smith would be on my track, and I told him to bugger off, or words to that effect.
'That conversation was not directly on the question of whether Spurs would be cleared or not. It was on the question of information I was releasing to the press. I wrote a letter to Sugar, because he had written to me the previous day, and I released a copy of my letter to the Press Association.
'He came on the phone, hopping mad, and asked me why I had released the letter to the press. I said because I don't want to receive any more letters from you, trying to cloud the issue on Terry Venables. He said, if you release the contents of my letter to you outside Lancaster Gate, Herbert Smith will be on to you. I said bugger off.
'We will do what's right, irrespective of all that. I'm not frightened of the High Court, believe me. I have no qualms whatever about it. We've won in the High Court against Herbert Smith on many occasions - the FA and the Football League.'
So had Sugar told Kelly that if the FA cleared Venables they would have to clear Tottenham if he was not to take them to court? 'He didn't say it to me, but he said it to the newspapers, and I suspect he may have said it to the Premier League inquiry, but I think he's calmed down quite a bit today, and I wouldn't want to get him back up on the roof again if the things he said yesterday are water under the bridge.'
Kelly saw no reason for the FA and Tottenham to be in contact again until the commission's report is available. In the meantime, the recruiting sub-committee, of which Kelly is a member, had met again, and were still as one over Venables. 'It is the view of the committee that if we can clear away all the surrounding issues, he would be the best man for the job, football-wise. That is accepted unanimously.'
The great imponderable was when. There was a need for 'due diligence'. Kelly explained: 'If we appoint him as manager and then we get a report that he's a rogue and a villain, and that he's broken every rule in the FA handbook, we'll be in a sticky situation.
'The sub-committee met on Monday, and on that day the Financial Times carried a long article. I had an argument yesterday with a reporter who accused us of prevaricating, which was most unfair. If you get a critical article in the FT - and we're not talking about the Sun or the Mirror here - which says, in effect, that your prospective employee is a million-pound fraudster, you've got to take steps to address that.
'What we have done is to make enquiries and move to resolve that issue. It seems that the situation is not as black as it has been painted by Panorama.' It would be 'very, very difficult indeed', Kelly said, to give Venables the job before the Premier League investigation was complete.
The delay in hearing the case had been down to Sugar's absence in Florida for a month. 'He wasn't available until yesterday (Tuesday). He has been seen now, but there are other people the commission want to see. After that, they've got to reach their conclusions, write a report and, presumably, if there's been a breach of football rules, hand it over to the FA.
'We're talking a matter of weeks rather than days, and the appointment of Venables in the meantime would be very difficult indeed. That accounts for the delay.'
Difficult, but not impossible. 'We might cut through the morass somehow, and get him appointed before the Premier League report is to hand. I hope we can. Personally, I hope it will happen, but it won't be this week.'
The talk last night was of a temporary appointment next Wednesday, with Venables in charge for England's next match, the friendly at home to Denmark on 9 March.
England friendly cancelled, page 12