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Appeal - J Walker v NZTR - 11 August 2010 - Decision

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Heard at Te Rapa Racecourse Hamilton

Friday 6th August 2010


APPEALS TRIBUNAL:  Mr Murray McKechnie, Chairman and Mr Bruce Squire QC


PRESENT:             Mrs Jan Walker

                             Mr Tony Ryan, Counsel for Mrs Walker

                             Mr John McKenzie, Chief Racecourse Inspector

                             Mr Bryan McKenzie, Racecourse Inspector

                             Mr Tony Enting, Registrar




1.            INTRODUCTION

1.1          At a hearing before a Non Raceday Judicial Committee at Te Rapa on the 12th July this year Mrs Walker pleaded guilty to a breach of Rule 804(2) of the New Zealand Rules of Racing. Mrs Walker is the trainer of the horse Speeler. On the 16th June this year at the Waipa Racing Club meeting Speeler was the winner of the SL & Computing Services Maiden for 3yr olds. The horse was ridden by Lynsey Satherley and won by 3¼ lengths. The horse was swabbed following the race and tested positive to caffeine.

1.2          At the commencement of the hearing on the 12th July Mrs Walker entered a guilty plea and the Non Raceday Judicial Committee then heard extensive submissions from Mr John McKenzie. Mrs Walker did not make any submissions on penalty other than to say that she asked for leniency and she said “she had worked hard and money was not easy to come by”. The Judicial Committee imposed a fine of $9,500.00 and ordered costs in favour of NZTR of $1,000.00 and in favour of the JCA of $550.00. The Committee further ordered the disqualification of the horse Speeler. In consequence the stake money was forfeit and the placings in the race amended.

1.3          Mrs Walker was represented at the Appeal Hearing by Mr Tony Ryan. NZTR was represented by Mr John McKenzie. Mr Bryan McKenzie the informant was also present.

1.4          In the week of the hearing the Chairman gave directions in relation to the conduct of the appeal and in consequence Mr Ryan on Wednesday 4th August made available an outline of his submissions. That was sent both to the JCA and Mr John McKenzie. The Tribunal is grateful to Mr Ryan for making that material available. At the hearing on Friday 6th August both Mr Ryan and Mr John McKenzie (all references hereafter to Mr McKenzie will be to Mr John McKenzie unless otherwise stated) presented detailed written submissions and addressed the Tribunal in support of that material. The wide ranging nature of the material caused the Tribunal to reserve its decision.

1.5          The Tribunal has read with care the transcript of the hearing on the 12th July. That runs to some sixteen (16) closely typed pages. The Tribunal has also carefully considered the decision of the Judicial Committee. Notwithstanding that Mrs Walker made very limited submissions, as outlined above, the decision runs to almost ten (10) pages and sets out in detail the circumstances of the administration of the prohibited substance, the explanation which Mrs Walker gave and the submissions of NZTR. More will be said of that decision at a later point in this judgment.

2.            GROUNDS OF APPEAL

2.1          By her counsel Mrs Walker contends that the penalty imposed was manifestly excessive. In support of this proposition Mr Ryan advanced a series of submissions. To some extent these overlap. In recognition of the detailed material prepared by Mr Ryan we shall consider each submission in turn.

2.2          It was contended that the Judicial Committee had not properly applied the principles set out in the decisions in P v NZRC (1994) and in the more recent decision in NZTR v C (2009). The latter decision places some refinement upon the earlier P v NZRC judgment. In NZTR v C five (5) sentencing principles were identified. These are:

(a)          The need to hold the defendant accountable for her actions. The penalty imposed must reflect the gravity of the defendant’s conduct and punish her for her wrongdoing;

(b)          The need to denounce the defendant’s conduct;

(c)           The interests of specific and general deterrents;

(d)          The need to prevent the defendant from re-offending by removing her from the industry by way of disqualification; and

(e)          The therapeutic aspect.

Mr Ryan acknowledged that it was necessary that there be punishment and a deterrent. Beyond that Mr Ryan contended that the sentencing principles had little application to the facts of the present case.

2.3          The next submission made for Mrs Walker was that there should be compatibility between the penalties imposed in New Zealand and Australia. Mr Ryan had undertaken some considerable research. Under the Rules of Racing in Australia the maximum penalty for a breach of the like Rule is $50,000.00. Mr Ryan made available a number of recent decisions from Australia. Regrettably these are all abbreviated in that the decisions do not contain detailed reasoning by the respective Tribunals to explain how the penalty level was arrived at. Mr Ryan further contended that the stake money in Australia was considerably higher than in New Zealand and that this was a circumstance which should reflect in greater penalty levels in Australia. The range of penalties in the cases identified by Mr Ryan were fines ranging from $1,500.00 to $3,500.00. In comparison Mr Ryan categorised the penalty imposed upon Mrs Walker as draconian and invited the Tribunal to hold that such a penalty level should only be adopted in extreme cases. It is appropriate to point out that the Rule provides not only for a monetary penalty but for suspension and/or disqualification. In the Tribunal’s view what counsel has described as an extreme case would almost certainly result in a suspension or in the worst case a disqualification.

2.4          It was contended that not only should there be compatibility with Australia but there should also be a measure of compatibility between penalties imposed under the NZTR Rules and those which govern harness racing and greyhound racing. Mr Ryan pointed to two (2) recent cases – in harness racing C and S. Both had to do with harness racing. From greyhound racing Mr Ryan pointed to B, a decision given on the 9th July this year. In that case where the prohibited substance was caffeine a penalty of $1,500.00 was imposed. In answer to questions from the Tribunal Mr Ryan advised that the maximum financial penalty under the Rules of Harness Racing NZ and those which govern greyhound racing were in each case $10,000.00. That contrasts significantly with the maximum financial penalty which can now be imposed under the NZTR Rules of $25,000.00.

2.5          The next submission advanced for Mrs Walker was that the Judicial Committee had been overly critical of the failure by Mrs Walker to read the reverse side of the container which contained the medication known as Itz Magic. That medication is used to treat respiratory infections in horses. The Tribunal was told that its use is very widespread. The container, which was shown to the Tribunal, contains on the reverse side a statement that caffeine is present and further that the medication should not be administered within ten (10) days of the horse racing. That warning is in small print and some concentration is required to read it. It is nonetheless plain enough. Mrs Walker acknowledged that she had used Itz Magic over an extended period. This circumstance is relevant to the Committee’s finding that her conduct in relation to the horse Speeler was to be categorised as grossly negligent.

2.6          Mr Ryan drew attention to the decision in NZTR v N. That is a decision of a Judicial Committee as recent as the 31st May this year. It involved a breach of the same Rule. The substance there was Clembuterol. Mrs Walker is a Class C owner/trainer currently with two (2) horses in the stable. N is Class A public trainer who at the relevant time had a large number of horses in work at Matamata Racecourse. By contrast Mrs Walker’s training establishment is some distance from Te Awamutu and not ordinarily open to public access. In the case of N it was not possible to establish how the prohibited substance came to be administered. The trainer was thus charged under the vicarious liability provisions of the relevant Rule. The prohibited substance was not locked away in the public trainer’s stable. There is no rule which requires the secure storage of medications that contain prohibited substances but good practice would clearly dictate that some degree of security does exist. Those considerations do not occur in this case as it has been acknowledged by Mrs Walker that she administered the Itz Magic medication to the filly Speeler. In essence Mr Ryan’s proposition was that the Committee had made an unwarranted distinction between the vicarious liability provision under which N was prosecuted and pleaded guilty and the circumstances of Mrs Walker. N was fined $6,000.00, ordered to pay costs of $1,000.00 to NZTR and $550.00 to the JCA. Both costs awards against N are precisely those which were imposed upon Mrs Walker. It is the quantum of the fine to which Mr Ryan directed his principal criticism. In this part of the submission reference was also made to the case of NZTR v B & B (October 2008). In that case three (3) horses were involved and a fine of $5,000.00 was imposed in each case. That prosecution preceded the Rule change in October 2009. Reference was also made to a case in the 1970’s (no written decision is available) involving I,I & H. That case, details of which are sketchy at best, is of no material assistance.

2.7          It was submitted that the Committee had not given sufficient consideration to Mrs Walker’s good character and previously unblemished record. It is not in dispute that Mrs Walker had held a licence for more than twenty (20) years and has never previously come to notice. Further Mr Ryan emphasised Mrs Walker’s early guilty plea and her complete co-operation.

2.8          It was next contended that the Committee had been overly influenced by the increase of penalties effective from 5th October 2009. That is when the maximum fine was lifted from $15,000.00 to $25,000.00. The submission made for Mrs Walker was that the change in the maximum financial penalty should not significantly alter the level of fines that are imposed. This submission is contrary to accepted judicial reasoning. Any persons exercising a judicial function, at whatever level, must have regard to changes in the law (or rules) which fix altered levels of penalty. The clear intention of the rule makers here was to make plain the seriousness of breaches of the prohibited substance rules. This submission is also contrary to the clear statement of the Judicial Committee in NZTR v M & M 12th February 2010. That was a case where licensed public trainers working in partnership had breached the relevant Rule on a second occasion within a period of eighteen (18) months. Unfortunately Mr Ryan appeared to have little acquaintance with this recent significant decision in NZTR v M & M. That case was widely publicised. On that occasion the Judicial Committee made it very clear that a significant increase in penalties would follow from the rule change and, in the most serious cases, result in suspension or possibly disqualification: refer paragraph 6.5 of the decision of 12th February 2010.

2.9          In conclusion Mr Ryan pointed to what he described as the present day value of the dollar. He referred to cases in previous years – one in particular from 2005 where a fine of $4,000.00 had been imposed. The proposition was that if the fines had increased at the same level as the value of the dollar had risen then the lift in the fine would have been around 1.14%. This would have resulted in a fine of $4,560.00. Mr Ryan submitted that Mrs Walker had been fined a sum which involved an increase of almost 100% over the figure of $4,000.00 imposed in the case of NZTR v H in 2005.

3.            THE CASE FOR NZTR

3.1          Mr McKenzie explained to the Tribunal that when Mrs Walker said she would plead guilty she had been told that perhaps she should seek legal advice about her appearance before the Judicial Committee. Mr McKenzie further explained that when Mrs Walker was spoken to she was told by the NZTR investigator that a fine would be sought in the region of $10,000.00. At the hearing before the Judicial Committee on the 12th July Mrs Walker did not have legal representation.

3.2          It was Mr McKenzie’s submission that the summary of facts presented to the Judicial Committee was fair and balanced. He pointed to those matters which were in the summary in Mrs Walker’s favour. These included her previously unblemished record and her prompt admission of responsibility.

3.3          In support of the decision under appeal NZTR emphasised that the Committee members were both very experienced and had significant previous acquaintance with cases involving  prohibited substances.

3.4          It was said on behalf of NZTR case that the conduct of Mrs Walker was properly categorised as grossly negligent (emphasis added). It was submitted that there was a material distinction to be made between a licence holder, at whatever level, administering the substance personally and a situation where as a result of some carelessness a staff person may have inadvertently administered a prohibited substance. In this regard Mr McKenzie emphasised the labelling of the Itz Magic container and Mrs Walker’s acknowledgment that she had used that medication for some period of time.

3.5          As to the comparison with Australia Mr McKenzie told the Tribunal that there was no formal communication between the enforcement authorities across the Tasman. The Tribunal for its part takes the view that if there is to be some greater degree of uniformity between the position in New Zealand and Australia that is for the governing bodies of thoroughbred racing.

3.6          Mr McKenzie contended that any comparison with the position in harness racing and greyhound racing was inappropriate given the maximum financial penalty available in those codes. Reference has already been made to those figures. The Tribunal observes that the financial penalties imposed in other codes for similar breaches do not of themselves demonstrate an error in the present case. The circumstances within the different codes are necessarily different. In thoroughbred racing the decisions in NZTR v M & M in February this year and NZTR v N in May this year demonstrate that the level of penalties in more recent times has been lifted. Neither of those decisions given by Non Raceday Judicial Committees were the subject of appeals.

3.7          With reference to Mrs Walker’s previously unblemished record NZTR contended that the Committee had, in truth, given this proper consideration. Mr McKenzie pointed to passages in the decision (paragraph 23 and the penultimate paragraph on page 9) which he said demonstrated that the Committee had given appropriate weight to Mrs Walker’s personal circumstances.

3.8          In conclusion Mr McKenzie submitted that in order for the appeal to succeed Mrs Walker was required to demonstrate that the penalty imposed by the Judicial Committee was manifestly wrong or that the penalty was manifestly excessive.  He pointed to the words in Rule 1007(2).

4.            DISCUSSION

4.1          In the Tribunal’s view it is important not to give too great an emphasis to the qualifying adjective manifestly. There are no guidelines cases.  This is in part because the circumstances which give rise to a breach of the prohibited substance rules are many and varied. Further, as the Tribunal wishes to make clear, the change in the maximum penalties (both with reference to fines and suspension and/or disqualification) from October 2009 brought new considerations to bear. Decisions of Judicial Committees or of the Appeal Tribunal which predate October 2009 are now necessarily of much less significance. The word manifestly has sometimes been described as meaning obviously, or very clearly or beyond doubt. This Tribunal considers that the right approach in considering whether the penalty under appeal is appropriate is to have careful regard to the facts of the case and determine if the fine was properly within the discretion which the Judicial Committee possessed when fixing the penalty level.

4.2          The circumstances of this case are very striking. Mrs Walker administered the medication Itz Magic notwithstanding the plain advice on the container that caffeine was present and that the substance should not be used within ten (10) days of racing. There was no adequate excuse for that.  Mrs Walker had been using Itz Magic for some time. It is difficult to believe that she had no knowledge whatever that this widely used medication was not subject to a warning. The Tribunal was told that the racing calendar had up until November of last year published warnings in relation to the medication Itz Magic. Mrs Walker and her partner Mr Ian Vincent have been in racing for an extended period.

4.3          The Tribunal does not accept that the Committee was wrong in adopting the categorisation of the conduct of Mrs Walker as grossly negligent.

4.4          For reasons already spoken of the Tribunal declines to draw comparisons with the position of thoroughbred racing in Australia or the harness racing and greyhound codes. Any attempt to bring penalties imposed in those areas into some sort of proportionality with the penalties imposed under the Rules of Racing is for the governing bodies of the respective codes. This is an issue which is beyond the business of a Judicial Tribunal on appeal.

4.5          The Tribunal believes that the Committee did take proper account of Mrs Walker’s unblemished record and her personal circumstances. Both are referred to in the decision in some detail: refer paragraph 3.7 above.

4.6          As to the sentencing principles enunciated in NZTR v P 1994 and NZTR v C 2009 the Tribunal does not believe that the Committee departed from those principles or that they were in some way misapplied.

4.7          The two (2) most useful recent decisions are NZTR v M & M and NZTR v N. The circumstances in the former bear little comparison to the present situation. As noted earlier that was the second offence within a relatively short period. The strongest submission for Mrs Walker is that the fine she was ordered to pay is out of proportion or inappropriate having regard to the fine imposed in NZTR v N in May this year.  It is worthy of note that the Chairman of the Judicial Committee in NZTR v N was a member of the Committee in the instant case. Much of the discussion at the Appeal Hearing on the 6th August centred around comparison between the circumstances in that case and this.

4.8          In NZTR v N the Judicial Committee found a number of mitigating circumstances. In the present case, save for Mrs Walker’s good record and early admission, there are no such mitigating circumstances. In its submissions before the Judicial Committee NZTR drew attention to all the relevant circumstances including all of the matters which could be advanced in Mrs Walker’s favour. The decision under appeal is careful and detailed. All of the relevant circumstances were considered.

5.            DECISION

5.1          The fine imposed was severe. It was however less than half the maximum available under the rules. The breach by Mrs Walker was inexcusable.

5.2          It is not appropriate for an Appeal Tribunal to make adjustments to penalties imposed by a Judicial Committee. To uphold the appeal the Tribunal must be satisfied that a serious error was made resulting in a penalty that was clearly wrong. The Judicial Committee went about its business very thoroughly. We are not persuaded that this Tribunal should make any change or adjustment to the fine. The appeal must fail and is dismissed.

5.3          The appeal was not without merit. In the circumstances the costs which will be awarded are modest. Mrs Walker will pay to NZTR the sum of $700.00. From that sum NZTR will settle the cost of the venue for the Appeal Hearing. Mrs Walker will pay the sum of $500.00 towards the costs of the JCA. The actual costs incurred by the JCA are considerably more than this figure.

5.4          The Tribunal thanks Mr Ryan and Mr McKenzie for their assistance.

DATED  this 11th day of August 2010




Murray   McKechnie                                                       Bruce Squire QC



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