Folau: I'll continue to stand up for the freedoms of all Australians. Photo: Reuters/Jason Reed

SYDNEY – Fallen star Israel Folau and Rugby Australia looked headed for a long and costly court battle over his sacking for homophobic comments Friday after last-ditch conciliation talks collapsed.

The country's Fair Work Commission had ordered the two sides to a closed-doors mediation hearing in a bid to avoid legal action over a dispute that has polarised Australia.

But Folau and his camp emerged some four hours later with no settlement.

“Very, very disappointed by the outcome today,” said the devoutly religious Folau. “I'd like to thank those who've supported me throughout this time. I'll continue to stand up for the freedoms of all Australians.”

The case is now expected to head to the Federal Court and could potentially drag on for years.

Folau, who was on a Aus$1 million-a year (US$700,000) four-year contract, is reportedly seeking Aus$10 million, including for lost sponsorship and marketing opportunities, a sum that reports say could be ruinous for Rugby Australia.

“It appears as though that unless things change we'll be heading to court,” George Haros, a lawyer for Super Rugby's record try-scorer, added outside the hearing in Sydney.

Folau was fired in May for breaching Rugby Australia's code of conduct after posting that “hell awaits” gay people and others he considers sinners.

The fullback took his case to Australia's Fair Work Commission, asserting that he simply posted sentiments from the Bible and was unfairly dismissed.

However, Rugby Australia insist his sacking was purely contractual, saying Folau had agreed not to disparage anyone over their sexual following a similar controversy last year.

Hopes of a resolution were slim with the two sides trading barbs beforehand.

Folau claimed in a television interview Thursday evening that Rugby Australia offered him money to take down the offensive post, but said, “I couldn't live with that”.

The governing body issued statement calling the allegation “completely false”.

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Earlier Friday, Folau released a video on his website demanding an apology from Rugby Australia and an admission that his sacking was wrong.

“Hopefully Rugby Australia will accept that my termination was unlawful and we can reach an agreement about how they can fix that mistake,” the 30-year-old said.

“First and foremost, I am hoping for an apology from Rugby Australia and an acknowledgement that even if they disagree with my views, that I should be free to peacefully express my religious beliefs without fear of retribution or exclusion.”

Israel Folau arrives for a conciliation hearing at the Fair Work Commission in Sydney. Photo: Reuters
Israel Folau arrives for a conciliation hearing at the Fair Work Commission in Sydney. Photo: Reuters

Rugby Australia chief Raelene Castle set out the organisation's stance in an email to the rugby community, saying it had “acted with complete professionalism and integrity at all times through the process”.

“This is an employment matter and does not concern his religious beliefs or his ability to express them freely,” she said.

The dispute has proved divisive, with many outraged over Folau's comments but others, including the Christian lobby, defending his right to free speech with calls for better guidelines on religious expression.

Prime Minister Scott Morrison, himself an evangelical Christian, said such disputes showed the need for legislation protecting people against discrimination based on their religious beliefs.

“Religious freedom is one of the cornerstones of what we are as a country, and it's important our laws reflect that,” he said in a televised interview Friday from Japan, where he is attending the G20 summit.

“Now we committed to put in place a Religious Discrimination Act. We're going to do that. We're working very hard on that right now,” he said.

Folau launched a crowdfunding campaign to pay his legal fees, but it was shut down after raising more than Aus$700,000, with the GoFundMe platform saying it would not “tolerate the promotion of discrimination or exclusion” and that the donations would be refunded.

In response, the Australian Christian Lobby launched a new fund and raised more than Aus$2 million in two days before pausing the appeal Thursday, saying it had enough money “for now”.

Agence France-Presse (AFP)