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The contract allows a manager to resign by mutual consent- both parties have to agree. Norwich have not agreed, so technically he is still our manager. If the talks do not go through with Villa, he will continue as Norwich manager.
There will be further clauses in the contract discussing what happens if Norwich don't release him- contrary to reports, we'll get some form of compensation (unless the board consent). This is the equivalent of them having just nicked him.
By tendering his resignation, Lambert has basically forced the board to allow him to speak to Villa, but by refusing the resignation the board have said fine, but we're still happy for you to return.