The New South Wales branch of the RSL spent more than $93,000 defending a senior executive accused of vilifying a young, gay RSL member, documents obtained by the ABC reveal.

Key points: $213,000 spent by league in legal fees over last seven years settling internal disputes

$213,000 spent by league in legal fees over last seven years settling internal disputes Bill Harrigan accused of making homophobic remarks about a young veteran

Bill Harrigan accused of making homophobic remarks about a young veteran League covered Mr Harrigan's legal bill, young veteran had no financial support

The ABC can also reveal that the league has paid more than $213,000 in legal fees in the last seven years on settling various internal disputes.

Glenn Kolomeitz, CEO of RSL NSW, said it was disappointing that such a large amount of money had been spent on the disputes, "when it could be going towards the welfare of veterans and their families".

"I'm cap in hand in this organisation trying to fund our mission and that would be a very good amount to put towards our care and welfare initiatives," he said.

One of the most expensive battles fought within the league in recent years was a discrimination case brought against the state councillor with the NSW branch of the RSL, Bill Harrigan, in 2010.

"Having seen the file, it was spending money defending the indefensible," Mr Kolomeitz said.

Mr Kolomeitz said Mr Harrigan had made disparaging remarks about a young veteran and tried to have him expelled from the league.

"It was a homophobic attack on a young veteran, and in this day and age really, the RSL must be a safe and comforting place for all serving and ex-serving members," he said.

The young veteran lodged a complaint with the NSW anti-discrimination board, which was referred to the administrative decisions tribunal.

Mr Harrigan disputed the claim, and his $93,000 legal bill was covered by the league, while the complainant received no financial support.

The state councillor later apologised and the matter was settled.

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No damages were paid and Mr Harrigan was not sanctioned.

Mr Kolomietz, who was not in the job at the time, said the RSL had since improved its dispute resolution procedures.

"It's common sense really. You start at the lowest level, you don't go straight to the lawyers and start taking up these sorts of fights," he said.

The CEO of RSL NSW, Glenn Kolomeitz (L), says the money could have been better spent. ( Justin Huntsdale )

RSL 'must be a safe and comfortable place'

As recently as 2009, the National RSL had a policy stating that "the presence of homosexuals, transvestites and transsexuals in the armed services could lead to serious tensions and undermines morale and discipline".

It also stated that "the league is opposed to any legislation which would provide homosexuals, transvestites and transsexuals with enforceable legal rights to employment in the armed forces".

Mr Kolomeitz said he was hopeful that things had improved since then.

"But clearly back then — and it wasn't that many years ago — that problem surfaced and it came from the highest levels of the RSL in NSW and it's very disturbing," he said.

"As I said, we must be a safe and comfortable place for all serving and ex-serving defence members to come to regardless of any of these perceived differences — race, religion, gender or sexual orientation."