New RSL-SA president Bronson Horan confirmed RSL National representatives – who it’s understood attended this morning’s meeting at North Adelaide’s Meridien Hotel by phone hook-up – conspicuously voted against a Deed of Company Arrangement proposed by administrators Rodgers Reidy, instead supporting a scenario that would see the not-for-profit going into liquidation.

Asked by InDaily if that account was correct, Horan said: “Yes it is – I’m still waiting to speak to them about that.”

“I did find that highly unusual,” he said.

“I believe we’ve developed a relationship with RSL National… moving forward, they’re still going to remain proud supporters of RSL-SA [so] it was a bit of a curveball, absolutely.”

The revelation is all the more startling because RSL National is one stakeholder with intimate knowledge of the state of RSL-SA’s finances, having instigated an independent forensic audit, as revealed by InDaily, even before the state branch went into voluntary administration in April.

“It’s concerning,” Horan conceded.

“The concern with that is that they did have a look at RSL’s finances… but they’re only one of five of our key stakeholders.

“They’re a board of directors, with different directors from different states, and some members may have a different view [from others].

“Now, maybe, it’s my job to win them over… I think I can do that.”

RSL National CEO Georgie Macris told InDaily the national office is a creditor of RSL-SA and “at the end of the day, the Deeds of Company Arrangements weren’t considered to be something that [we as] creditors could support”.

I took a business decision, nothing more, nothing less

“I requested additional information on how we were going to substantiate future trading, and I didn’t get that information,” she said.

“I had to make a decision on behalf of the members… I took a business decision, nothing more, nothing less.”

She said the national board did not vote ‘for’ liquidation, but rather ‘against’ the proposed Deeds of Company Arrangements.

“We are entitled to take a vote… based on the information provided, we decided we weren’t in favour of the DOCAs. We weren’t in favour of liquidation – we weren’t in favour of the DOCAs. You don’t vote on this or that, you vote on whether you support the DOCAs.”

She said now that the DOCAs had been supported by the majority of creditors, the new board “will rebuild this organisation and you’ll have a brand new RSL in 12 months’ time”.

Rodgers Reidy had previously told creditors, in a lengthy report to creditors last week, that if the DOCAs failed to win support it would create a “worst case scenario” whereby “a further pool of creditors” would be created by ongoing trading, with future creditors “expected to increase”.

That would include the State Government, which InDaily revealed last week has agreed to loan RSL-SA $200,000 to help it restructure.

Assets would reduce in value, while “liquidators and legal fees will likely increase”, with a reduced dividend expected for unsecured creditors.

The state RSL is still awaiting a decision from the national regulator over whether it is allowed to keep its charitable status, after the Australian Charities and Not-For-Profits Commission (ACNC) demanded it show cause as to why it should not be stripped of its tax-free status.

Horan said ACNC representatives had visited Adelaide in recent days for talks.

“When they left we had all agreed on a really strong way forward with regards to maintaining our charitable status,” he said.

However, he conceded ACNC had informed RSL-SA that, under its definition, the branch had been trading while insolvent in the months leading up to its administration.

That’s despite Rodgers Reidy’s report finding that an allegation of trading while insolvent was arguable but contestable.

“Overall, our investigations into the solvency of the Associations suggest that they collectively have had sufficient assets to meet outstanding creditor claims,” the document stated.

“The issues lie in their inability to easily and quickly convert their assets into cash to pay their debts, as and when they fall due.”

The latest bombshells overshadowed a positive day for the embattled state branch, with an asset fire sale given the green-light, in a move that will allow the not-for-profit to continue trading.

Bronson said the decision was “great news and the culmination of a lot of hard work”.

It will see the Royal Australian Regiment buy its Linden Park headquarters from RSL-SA for around $870,000 and control of the RSL’s ongoing operations revert back to its board. That will be, nonetheless, effectively a new regime after the recent resignations of longtime president Tim Hanna and his deputy Jill Hoare, with Horan taking the reins as president of a vastly reconfigured board.

The Linden Park sale will offset payouts for staff entitlements, while other creditors will await the proceeds of other property sales, including land at Victor Harbor and Alice Springs.

Creditor Mick Mummery, whose Spirit of Gallipoli had money held in trust for a student exchange program, told InDaily it was “generally a very good result for the RSL and the creditors”.

“I’m confident we’ll have the money that was previously missing returned to us,” he said.

But he warned “the RSL is not out of the woods yet”.

“They’ve still got a challenging time ahead, and for the next 12 months they’re going to have to put their nose to the grindstone,” he said.

“Certainly from my point of view, I’d like to know how it all occurred… whilst I’m confident that the RSL will now be able to move forward, unless we know how it all went wrong we won’t know which pitfalls to avoid.”

Horan said his message to the state RSL membership was: “Thanks for your support, and I’ll be in communication with you very shortly.”

He described the membership as the “lifeblood of the organisation” and lamented that they had not been kept in open dialogue with RSL management.

“That stops now,” he said.

“We will always have open lines of communication.”