Western Force appeal: ARU win case to axe club

THE Western Force have lost their case to overturn the ARU’s axing of the Super Rugby club and the news has devastated the playing group.

Western Force players have discovered the fate of the club.

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THE Western Force have lost their case to overturn the ARU’s axing of the Super Rugby club, with the NSW Supreme Court today ruling against them.

Justice David Hammerschlag handed down his decision this morning at the NSW Supreme Court.

WA Rugby had appealed the decision of arbitrator Bernard Coles QC, who ruled that a new SANZAAR broadcast agreement of 15 teams was legally binding, therefore nullifying a participation agreement between the ARU and Western Force guaranteeing them survival until December 31, 2020.

FORCE v ARU EXPLAINED: Scroll down for a breakdown of the what, why and how of the Supreme Court ruling

Western Force players have discovered the fate of the club.

That date is when the old broadcast agreement of 18 teams ends, but it is also the date the new agreement with reduced teams and games ends, creating confusion as to whether there was any firm difference.

This became the major point of contention between the lawyers of WA Rugby and the ARU in the Supreme Court when the matter was heard 10 days ago.

Robert Newlinds SC, arguing for WA Rugby, said it would be moot for the Force to have a participation agreement if they could be axed without notice.

ARU barrister Justin Gleeson SC countered by saying the new broadcast agreement – which is for the same value and includes the same networks but has less teams and games – made the premise of the alliance agreement redundant.

Billionaire and philanthropist Andrew Forrest has thrown his support behind Western Force players.

SANZAAR decided to reduce the competition after the clunky four-conference 18-team model was spurned by fans and led to a drop-off in viewers and attendees.

The ARU announced that it would assess the business cases of the Force and the Melbourne Rebels, before deciding the Perth team was the franchise they intended to cut in August.

This led to the legal action by WA Rugby to save the team.

The Force reacted angrily to the decision, releasing a statement suggesting the ARU never seriously considered axing the Rebels, while keeping open its options to continue legal action.

“We are disappointed to announce that RugbyWA has been unsuccessful in appealing the arbitration decision in the Supreme Court of New South Wales allowing the Australian Rugby Union (ARU) to terminate the Alliance Agreement,” the statement said.

“This now means the ARU have the ability to remove the Western Force from the Super Rugby competition. Based on previous correspondence we are expecting the ARU to confirm the termination of the Western Force’s participation in the Super Rugby competition. We understand that the ARU intend to continue with the Perth Spirit in the National Rugby Championship.

“RugbyWA will evaluate its legal options and consider grounds to seek leave to appeal to the NSW Court of Appeal in the coming days. RugbyWA also welcome the proposed Senate inquiry proposed by Senator Linda Reynolds into the conduct of the ARU.”

They were supposed to be allies, but they were not friends

We break down the NSW Supreme Court ruling which has cleared the way for the ARU to kick the Western Force out of the Super Rugby competition.

THE FACTS

The ARU is one of three member of SANZAR.

SANZAR operates the Super Rugby competition.

In 2017 SANZAR took the decision that the Super Rugby competition needed to be trimmed from its existing 18 teams structure to a 15 team competition.

The restructure would result in one of the 5 Australian teams dropping out. The Australian team nominated to drop out of Super Rugby was the Western Force.

The restructure required the renegotiation of the broadcast agreements for the Super Rugby competition. This renegotiation was completed in July 2017.

The ARU owns the Western Force having bought them from the WARU in 2016.

A condition of the sale was the 'Alliance Agreement' - an agreement which required the parties to, amongst other things, 'co-operatively work in an alliance to grow and develop rugby in Western Australia'.

The Alliance Agreement expired: 'on the expiry date of the last of the SANZAR Broadcast Agreements (being 31 December 2020) or, subject to clause 2.4, if the last of the SANZAR Broadcast Agreements is terminated or renegotiated earlier as a result of the renegotiation of the commercial terms of a broadcast arrangement, such earlier date.'

THE ARGUMENTS

The WARU argued that dropping the Western Force from the Super Rugby competition breached the Alliance Agreement.

The ARU argued that the 'Alliance Agreement' had expired as a result of the broadcast agreement renegotiation that ended in July 2017.

THE JUDGMENT

The case was a simple matter of contractual interpretation and the court applied the words as written in the agreement not with the implied meaning the WARU assigned those words.

The judge opined that 'hopefully they (ARU AND WARU) both had the interests of furthering the game of rugby union in mind. It is to be remembered that ARU owns the Force. If the alliance comes to an end, it owns the Force unconditionally without any potential obligation to sell it back in the future, and can do with it what it likes, even destroy it.

"As the facts of this case demonstrate, they were supposed to be allies, but they were not friends."

THE RESULT

The Alliance Agreement was terminated when the broadcast agreements were renegotiated. The ARU is free to cut the Force from Super Rugby.

Originally published as Western Force appeal: ARU win case to axe club