Rugby Australia preparing counter-claim against Rebels directors

Rugby Australia (RA) is preparing a legal counter-claim against directors of the defunct Melbourne Rebels who are suing the governing body over the demise of the Super Rugby club.

The directors lodged a claim at Australia's Federal Court this week and are seeking $33 million in damages from RA.

RA spurned a rescue deal in May for the indebted club which was shuttered at the end of the Super Rugby Pacific season in June.

RA said it rejected the directors' "ambit claims" and "attempts to shift blame for their financial mismanagement".

"RA is preparing a counterclaim against MRRU (Melbourne Rebels Rugby Union) and its directors for misleading and deceptive conduct concerning the financial position of MRRU dating back to 2018," the governing body said in a statement.

"Had RA not been misled or deceived, it would not have provided MRRU with a participation licence and thus not lost in excess of $38 million that was paid to MRRU since at least 1 July 2018."

Responding to the statement, the Rebels directors said RA had made false and self-serving counter-claims.

"We believe this to be a desperate attempt to deflect attention from the reality of the situation that the RA Executive and Board have put the sport into," the directors said.

"We want an independent person to decide whether the conduct of Rugby Australia meets the standards required by law - and that will now be a Federal Court Judge."

The Rebels went into voluntary administration in January with debts of more than $22 million.

RA stepped in to fund the Rebels' operations, including paying player and staff wages, to ensure the team could play out the season.

The Rebels' administrator said this year that the club may have been trading while insolvent from 31 December, 2018. It recommended creditors accept a deal put forward by them to save the debt-ridden team.

Creditors accepted the deal but RA rejected it, saying it was not sufficiently viable.

- Reuters