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Thursday 28 August 2014

Rory McIlroy email indicated no problem with agents' commission, court told

Tim Healy

Published 20/03/2014 | 02:30

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Rory McIlroy is embroiled in a court case with his former agent
Rory McIlroy is embroiled in a court case with his former agent

GOLFER Rory McIlroy indicated in an email that he had no difficulty with a proposed representation agreement – which would see him pay agents' commission rates of 20pc of his off-course earnings, the Commercial Court has heard.

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Mr McIlroy is suing the agents claiming he signed a December 2011 representation agreement under "undue influence" when he was just 22 years old and inexperienced.

In addition, the email showed the proposed agreement would see the golfer pay agents' commission of 5pc on his on-course earnings.

The sports star sent the email in October 2011. He replied to an email from Conor Ridge, managing director of Dublin-based agents Horizon Sports Management, setting out the proposed commission rates, counsel Paul Sreenan, for Horizon and two other companies, told the court.

In his action, Mr McIlroy claims he has paid more than $6.8m (€4.9m) based on "unreasonable" fee rates "many times greater" than standard in the sports agency industry.

He also alleges the defendants are not entitled to be paid certain fees into the future related to his $20m (€14.5m) a year sponsorship deal with sportswear giant Nike.

However, the defendants contend Mr McIlroy freely entered into the December 2011 agreement and deny any undue influence or that the terms of agreement were unreasonable.

They have counter-claimed for monies allegedly owed under the agreement – including some $3m fees for off-course gross revenues.

Mr Sreenan told the court that Mr Ridge had also stated that another company may be set up to exclusively manage the golfer's affairs. A company later set up was both for the benefit of Mr McIlroy and for "tax planning" purposes of his agents, the court heard.

Mr Sreenan said Mr Ridge and law firm William Fry had both suggested Mr McIlroy could get independent legal advice before he signed a representation agreement in December 2011 – based on the terms set out in the October 2011 email – but he chose not to do so.

DISCLOSURE

Mr Sreenan was making submissions to the court in opposition to an application by Mr McIlroy seeking court-ordered disclosure of certain other documents for his action.

The case against Dublin-based Horizon is also against Gurteen Ltd, with a registered address in Malta, and against Dublin-based Canovan Management Services. The case is expected to be heard later this year.

A central issue in the action concerns the nature of the relationship between Mr McIlroy and the three defendants and the validity of the December 2011 representation agreement. Mr McIlroy insists he is not bound by it.

Ms Justice Mary Finlay Geoghegan will today continue hearing applications for discovery of documents concerning those and other issues.

Mr McIlroy wants all documents concerning the legal and beneficial ownership and shareholdings of all three companies but the defendants contend he is only entitled to those documents concerning Gurteen and Canovan, not Horizon.

The ownership and shareholdings of Horizon are not relevant in circumstances where Mr McIlroy had been told a separate company might be set up to manage his affairs, it was argued.

Gurteen was set up to assist in managing Mr McIlroy's affairs and there were also advantages, including tax planning, to the defendants, Mr Sreenan said.

Mr McIlroy insisted he only dealt with Horizon as his agent and with Conor Ridge and Colm Morrissey.

Irish Independent

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