Japan club axes Aussie great
The 37-year-old loose forward was arrested in Tokyo on New Year's Eve, after he allegedly refused to pay his taxi fare and then punched the driver.
Smith was also suspected of running away from the taxi without paying roughly ¥10,000 (US$90) for the fare, according to Tokyo Metropolitan Police.
He was released after 18 days in police custody after prosecutors decided against pressing charges.
Smith denied the allegations.
Nevertheless, the Japanese club said it treated the matter as a grave concern and expressed "heartfelt" apologies for the trouble caused.
"No indictment was made as a criminal case, but the company takes this incident seriously and decided to discontinue our contract with George Smith as of the end of January and make him leave the club while strictly reprimanding his supervisor," the club said in a statement.
Suntory said it would also take "thorough measures" to educate players to ensure such an incident does not occur again.
Smith won 111 caps for his country and twice won the prestigious John Eales Medal for best Australian rugby player.