Rory email indicated no issue with fees, court told

An email sent by golfer Rory McIlroy in October 2011 indicated no difficulty with a proposed representation agreement under which he would pay commission rates of 20% and 5% respectively on his off- and on-course earnings, the Commercial Court in Dublin was told yesterday.

McIlroy is taking an action against Dublin-based Horizon Sports Management Ltd; Gurteen Ltd, with a registered address in Malta; and Dublin-based Canovan Management Services.

McIlroy’s email was sent in response to an email of Conor Ridge, managing director of Horizon Sports Management Ltd, setting out the proposed commission rates, Paul Sreenan SC, for Horizon and two other companies, outlined.

Ridge had also stated that another company may be set up to exclusively manage the golfer’s affairs, Sreenan added.

A company later set up was both for the benefit of McIlroy and for “tax planning” purposes of his agents, the court heard.

Sreenan said Ridge and the law firm William Fry had both suggested 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.

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

The defendants contend it was agreed with McIlroy the contractual rights under the December 2011 agreement were with Gurteen rather than Horizon, but he disputes that.

Horizon admits his relationship concerning the matters at issue in the case was “de facto” with Horizon but contends once the representation agreement was signed, Horizon provided the services as agent for Gurteen and, later, Canovan.

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

In his action, McIlroy claims he signed the December 2011 representation agreement under “undue influence” when he was just 22-years-old and inexperienced.

The Holywood star claims he has paid more than $6.8m 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-a-year sponsorship deal with sportswear giant Nike.

The defendants contend McIlroy freely entered into the December 2011 agreement and deny any undue influence or that the terms of agreement were unreasonable or unconscionable. They have counter-claimed for $3m in fees and damages.

The case is expected to be heard in the Commercial Court later this year.