Fiji Rugby Union board operated illegally - Siromi Turaga

Fiji's minister for justice and attorney general Siromi Turaga has clarified the reason for the dismantling of the Fiji Rugby Union board was because it was operating illegally.

In a statement released this afternoon the attorney general explained that anomalies in the creation of its 2018 constitution rendered it null and void.

Turaga said in a meeting on Wednesday he advised the now former board of directors of the Fiji Rugby Union that it could not operate as a charitable trust for the following reasons:

1. FRU is being run by its board using the articles of association of the FRU Company, which is illegal for charitable trusts.

2. There is no link between the Fiji Rugby Football Union Trust Board (the charitable trust) and the Fiji Rugby Union Pte Limited (the company limited by guarantees) for the governing instrument of one to apply to the other, and vice-versa.

3. The 2018 constitution being used by the FRU Board to make appointments to run its affairs, set the AGM, call for nominations, defend appeals by Suva, Naitasiri and Namosi, and operate thus far is NOT registered under the Charitable Trust Act, nor at the Registry of Titles, and is therefore illegal.

Siromi Turaga said this was due to the fact that the constitution was unsigned and undated by the Trustees, unaccompanied by the minutes of the meeting of the Annual General Meeting (AGM) or Special General Meeting (SGM) of the FRU wherein the constitution was adopted, not witnessed, signed and stamped by any Commissioner of Oaths or solicitor and not endorsed, signed and stamped by the Registrar of Titles at the time it was lodged for registration.

He said in light of these anomalies he informed the FRU board of directors that under

the laws of Fiji:

i. The FRU will need to regularise and legalise its status as a charitable trust to be consistent with the provisions of the Charitable Trusts Act 1945.

ii. Until and unless the status of FRU as a charitable body is regularised, the AGM cannot be convened.

iii. Unions and members of the FRU will have to be notified of the new AGM date by a new Board of Trustees in due course, and:

iv. Its AGM planned for this Saturday (29 April 2023) has to be deferred

Following the Wednesday meeting with the FRU Board of directors Siromi Turaga said those in attendance

acknowledged by consensus to resign voluntarily while absent directors were to resign by flying minute.

Turaga said this meant that using his powers as Minister for Justice under Fiji's Charitable Trust Act he has moved to:

A. Protect the assets and operations of the FRU.

B. Appoint interim Trustees of the FRU to take it forward to a SGM.

C. Appoint an interim administrator to act on behalf of interim trustees.

FRU losses

Unions have raised questions about financial management, with a reported loss of $FJ1.3 million in the FRU's 2022 annual report.

Rugby House put it down to the absence of sponsors for programmes, losses in domestic competition due to reduced sponsorships, and under-collection from the budgeted income.

In 2021, FRU made a profit of $269,554.

Sale Sorovaki wrote in his report that 2022 posed huge financial challenges for Rugby House.

"While our borders had opened and business started to recover, our sponsor levels did not return to pre-Covid-19 levels and several of our teams did not have major sponsors although we tried our level best to find alternative sponsorship," he wrote.

"The major programmes that remained without sponsors were the Fijiana Drua, the Fijiana XVs for the Rugby World Cup 2021 and its test matches, and the Flying Fijians.

"Whilst being minded of costs, these teams still had to participate out of contractual obligations with World Rugby. The financial impact of participation was always anticipated.

"We report a financial loss position of $1,354,816 for the financial year 2022, compared to a financial profit of $269,554 in 2021."

Suva's grievances

Suva Rugby Union secretary Nemani Tuifagalele said the FRU trustees needed to come out strongly about what the national union was doing, especially in the uncertainty of whether the FRU is still a charitable organisation or a registered company.

He said unions were confused because of what has transpired and there seemed to be confusion on the part of the FRU.

Answers needed to be provided if the charitable trust was still active or if the union has become a company.

Tuifagalele said that inspection records from the Titles (Registrar of Companies in Suva) reflected that FRU as a charitable trust has been de-registered on January 24 2022 and this is confirmed by the new constitution (post 2018) as it made no reference to the trust at all.

"The fact that the audited financial account will reflect either a profit or loss to FRU shows that that's how a company's success is measured, not for a trust. So what happened to the trustees?

"It's simple, if the trust is gone, the trustees have gone out the window too. On the other hand, if FRU is a charitable trust as claimed, then how can it be regulated by an articles of association, which is the current constitution of FRU meant to regulate a company?

"All notices of the AGM, objections to unions nomination and motion, revelation of non-compliance by unions emanates from this constitution," he said.

"Moreover, if FRU is a trust entity, then the trustees are the current bosses of FRU and not the present board members who were nominated out of a company set up under the new constitution. The trust then should be regulated by the pre-2018 constitution and not the present one.

"Has there been a transition of FRU as a trust to being a company? The answer is quite tricky. If yes, then the trustees have evaporated. If the answer is no, then the anticipated AGM on April 29th cannot be convened under the provisions of the present articles of association or constitution of the company.

"So this coming AGM really should be spearheaded by the trustees of FRU as a trust entity and should be regulated by the pre-2018 constitution of the trust. Trustees, do your job."

Tuifagalele said the company as registered only has one shareholder.

That means there is no need for an AGM.

"We can all agree that only shareholders of a company can vote, have a voice at the AGM of a company depending on what the articles say about its company meeting protocol. If FRU Ltd as a company has one shareholder with 100 percent shares, then that person is the only one who can attend/vote/has a voice in that AGM and no one else.

"That sounded silly as that person might not need to convene the AGM at all as he's the sole owner of the company," he said.

"If it's argued that there are others who were registered as members of the company, then their membership holds no water as 100 percent shares are held by one person and he decides alone over the affairs of the company.

"If we assume that FRU is a company now, then it can't be a charitable trust at the same time, so the question is, what is FRU really as a legal entity?"

The FRU had said last week that all nominations and motions filed by unions for the AGM planned for Lautoka on Saturday were null and void.