Post by Greg Joos » Wed, 29 May 1996 04:00:00

   By Bruce Walkley of AAP

           SYDNEY, May 27 AAP - Australian Rugby League general manager
John Quayle lied to the league's clubs in a letter he sent them
before they signed five-year loyalty agreements last year, the
Federal Court heard today.
           Charles Sweeney QC made the comment while putting submissions on
behalf of Super League-aligned clubs at the hearing of an appeal by
News Limited against Justice James Burchett's judgment earlier this
year, when the judge made orders banning Super League until the end
of the century.
           Sweeney said Quayle wrote to the clubs after a meeting on
February 5 last year rejected the News Super League proposal, and
told them they would be guilty of gross disloyalty if they did not
sign the agreements approved at the meeting.
           He said Quayle drew the notice of clubs to a motion passed at
the meeting that any club not returning the signed agreement within
a specified time should be expelled from the league.
           However, according to Sweeney, Quayle knew that the league board
had already met and rejected the call from the meeting regarding
expulsion before he wrote the letter.
           "He wrote, in effect, misleading the clubs," Sweeney said.
           "Why was it necessary for Mr Quayle to tell a lie about the
consequences of not signing up?
           "At this moment in time it (the league) had the ability, because
it was the only organisation up and running, by a balanced and
slick routine, to force these clubs to lock in for five years."
           Sweeney said each club's actions in signing the agreements had
been "fuelled by the fear, reinforced by Mr Quayle's letter, that
if it didn't lock in for five years it would be locked out" of the
ARL competition.
           He described the ARL's motives in getting the clubs to sign the
agreements as "a market foreclosure strategy" to prevent News
Limited setting up as a rival competition organiser.
           Sweeney said the purpose of the agreements was "not to permit
the clubs to play for the league for five years".
           "The purpose of the agreement was to tie the clubs exclusively
to the league for five years," he said.
           Evidence of this was that ARL chairman Ken Arthurson had acted
as though he did not believe assurances to the meeting by News
chief executive Ken Cowley had given assurances that there would be
no rebel competition.
           "Mr Arthurson and Mr Cowley were in conflict -- Mr Cowley wanted
a product, Mr Arthurson had his foot on the product," he said.
           Arthurson had made statements at the February 5 meeting, after
Cowley had given the assurance to club delegates, in which he
referred to solidarity among the clubs and the need to know where
they stood on the Super League issue.
           "He went around the castle putting up the drawbridge, putting
down the moat, shoring up his defences," Sweeney said, adding that
these were not the actions of a man who believed there was no
further threat from News Limited.
           Counsel for News, Dyson Heydon QC, put similar arguments earlier
in the day.
           Heydon said Justice Burchett had found in his judgment that the
purpose of the agreement, and an earlier one signed in November
1994, had been to ensure the stability of the leagues' competition.
           This had come about as a result of Justice Burchett accepting
Arthurson's evidence about the agreements' purpose.
           But, Heydon submitted, "no-one could have signed the agreements
without realising what their purpose was".
           He said Justice Burchett had erred by not finding that the
agreements, which were signed in November 1994 and February 1995,
were meant to exclude News Limited.
           Heydon said evidence that the second agreement, in particular,
had this purpose was that it was signed to close a loophole in the
first agreement.
           This would have allowed the clubs to agree to release their
players from their contracts, and the second agreement contained a
clause prohibiting them from doing so.
           The appeal hearing, before Justices John Lockhart, John von
Doussa and Ronald Sackville, will resume on Wednesday.
           AAP bzw/ij/


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