Watch former pupil open rally (7)

I believe the answer is:

observe

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'watch' is the definition.
(I know that watch can be written as observe)

'former pupil open rally' is the wordplay.
'former pupil' becomes 'OB' (abbreviation for 'Old Boy' - private school pupil).
'open rally' becomes 'serve' (I can't explain this - if you can you should give a lot more credence to this answer).
'ob'+'serve'='OBSERVE'

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(Other definitions for observe that I've seen before include "Obverse (anag.)" , "What this newspaper does?" , "Watch, take note of" , "Look at" , "Watch closely" .)

I've seen this clue in The Telegraph.

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