Case Looks At Whether Contract Can Be Enforced

Fresh off his first tournament win of the year in Dubai, Rory McIlroy will today start his multimillion-dollar case against Horizon Sports Management - his former management company.

The World’s number one golfer signed a management agreement with Horizon in 2011 which entitled them to 20% of McIlroy’s off-the-course income from sponsorship deals together with 5% of his tournament winnings.

In January 2013 McIlroy signed a sponsorship deal with Nike said to be worth as much as €190m making him one of the highest paid sports stars in the world.

By September 2013, he had parted company with Horizon and established Rory McIlroy Incorporated, to manage his affairs.  McIlroy sued Horizon claiming that the agreement was ‘unconscionable’ and indeed claims that he was coaxed into signing the deal at the Horizon Christmas party.

He argues that he was subjected to undue influence and the commission fees due to Horizon are much greater than the industry standard. McIlroy is seeking to recoup the excessive fees paid meanwhile Horizon has launched a counter-claims alleging breach of contract by McIlroy and seeking $2.4million in unpaid fees.

Expert Opinion

McIlroy has claimed that the Horizon contract signed when he was 22 is an ‘unconscionable bargain’ and is invalid and unenforceable on a number of grounds. McIlroy states that he was inexperienced, did not have independent legal advice at the time and he had to pay his agent excessive fees compared to Graeme McDowell who was on superior terms with Horizon. <br/> <br/>“The case will rest on whether McIlroy can successfully argue that the contract was so grossly oppressive and one sided that it would be unfair to enforce it. We have seen a number of high profile disagreements with sport management agents in recent years including Wayne Rooney’s dispute with Proform Sports Management. The difference with that case however is that Rooney was a minor and the contract was voidable. <br/> <br/>“McIlroy was 22 when he signed the Horizon contract and also of course shortly after signed a 10-year lucrative contract with Nike, putting him amongst highest earners in global sport. It will be interesting to follow if McIlroy can convince the court that he was manipulated to enter into the Horizon deal and it was ‘unconscionable’ and unfair especially as it coincided with the multi-million Nike deal.” <br/> Sarah Riding - Partner