McIlroy left with €21.8m bill

Golfer Rory McIlroy’s case against former management company Horizon Sports Management has been settled. It is understood the golfer will pay the firm over $25m (€21.8m) in a once-off payment plus costs.

Following negotiations on Tuesday, Paul Gallagher, for Mr McIlroy, told the Commercial Court yesterday the parties were grateful for the time given for talks and the matter had been settled.

Counsel said no order from the court was required but the case could be put back to February 24 for mention. Such an adjournment is usually so that the court can be advised of the formal settlement. Mr McIlroy was not in court yesterday.

Mr Justice Brian Cregan congratulated all parties on reaching agreement in a long-running case.

A brief joint statement afterwards said the case had been “settled to the satisfaction of both parties who wish each other well for the future”.

The hearing was due to get under way on Tuesday when the judge was told the case was scheduled to last eight weeks and there were many issues involved.

Both sides were seeing if they could narrow those issues and the case was adjourned twice to allow discussions continue which went on into yesterday.

Mr McIlroy attended court on Tuesday. The case was against Dublin-based Horizon Sports Management and two associated special purpose firms, Gurteen, with a registered address in Malta, and Dublin-based Canovan Management Services over what the golfer claimed were improvident representation deals made in December 2011 and March 2013.

The defendants denied the golfer’s claims and also counter-claimed. The case was fast-tracked to the Commercial Court in October 2013. While mediation talks were advised by judge, they were not successful.

According to court papers, Horizon managing director Conor Ridge initially made a verbal agreement for the firm to act as the golfer’s agent following a presentation made by Mr Ridge at Mr McIlroy’s Belfast home

In December 2011, the formal agreement was entered into at the offices of solicitors William Fry during Horizon’s Christmas party in “circumstances of great informality” when Mr McIlroy says he had received no independent legal advice and without receiving any draft of the agreement.

That agreement gave Horizon complete control over his affairs, including his commercial activities, and placed the defendants in a “position of great trust”, it was alleged.

In 2013, there was an amendment to the December 2011 agreement, which was for three years, in which Gurteen was to be entitled to 20% of all pre-tax sums paid to Mr McIlroy under a contract signed with sportswear giant Nike in late 2012.

Mr McIlroy claimed the appropriate fees should have been 0% on his golf earnings and 5% to 7% on off-course earnings. He claimed he paid over US$6.8m to Horizon based on unreasonable fee rates “many times greater” than is standard in the sports agency industry.

In seeking a court order cancelling the agreement, he said it was “restrictive”, “unconscionable” and “oppressive” on grounds including alleged negligence, breach of contract and breach of fiduciary duty.

The defendant companies argued the golfer received “extraordinary benefits” from their work and was seeking to avoid his contractual responsibilities.

At a hearing last March the defendants contended Mr McIlroy freely entered into the agreement and denied any undue influence or that the terms were unreasonable or unconscionable.