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Court of Appeal: Awards made to Dundalk bookmakers for breach of contract overturned

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In a dispute involving bookmakers and Dundalk Racecourse, the Court of Appeal has found that the loss of betting ring pitches in the redevelopment of the racecourse in 2007 did not constitute a breach of contract. In a joint judgment by Ms Justice Mary Finlay Geoghegan and Ms Justice Mary Irvine, the awards made to the bookmakers were set aside.

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About this case:

The Pitch Rules

The “Racecourse Executives’ Seniority and Pitch Rules”, were an agreement between the Association of Irish Racecourses (AIR) and the Irish National Bookmakers’ Association (INBA). In respect of each racecourse, the “Executive” is defined as meaning the person “who owns or exercises control over that racecourse”. The preamble to the Pitch Rules states:

“These Rules represent the conditions upon which individual bookmakers are entitled to carry on the business of bookmaking at a particular pitch on any authorised racecourse, excluding point-to-points, together with details of how such pitches are to be allocated to or transferred between bookmakers.”

High Court

Bookmakers Mr Francis Hyland, Mr John Hughes, and Mr Patrick O’Hare claimed that the Pitch Rules were a contractually binding agreement between Dundalk, and each bookmaker which obliged Dundalk on the re-allocation of pitches in 2007 to respect or honour the bookmakers’ seniorities as they existed at Dundalk prior to September 2001, and precluded it demanding an €8,000 capital contribution from the bookmakers.

Dundalk disputed the enforceability of the Pitch Rules by an individual bookmaker against it as a racecourse owner. It also disputed that the Pitch Rules applied to the allocation of pitches at Dundalk in August 2007 primarily upon the basis that it was a new racecourse. It also maintained that the Pitch Rules did not apply to the allocation in August 2007 in reliance upon Rule 19 as the new racetrack was an all-weather racetrack. Dundalk also counterclaimed that the Pitch Rules violated s. 4 of the Competition Act, 2002 and that there was an illegal trade boycott of Dundalk Racing.

The trial judge’s findings in the liability judgment were summarised as follows:

  1. The Pitch Rules are enforceable by the individual bookmakers against the individual racecourse owners and the bookmakers may sue to enforce them in the same manner as any other contract to which they are expressly named as a party.

  2. The decision of the Pitch Tribunal on 30th July 2007 was merely to the effect that the Pitch Rules (as they then stood) would not apply to a new racecourse. It did not decide the fundamental question as to whether the redeveloped track at Dundalk constituted a new racecourse.

  3. Dundalk racecourse in 2007 remained in substance the same racecourse it was in 2001, at least in the sense contemplated by the Pitch Rules. Dundalk, in its allocation of pitches in 2007, was bound by the Pitch Rules and had no entitlement to require the bookmakers pay €8,000 as a capital contribution.

  4. The Pitch Rules do not violate s. 4(1) of the Competition Act 2002.

  5. There was a collective boycott by “certain bookmakers” of those bookmakers who took up pitches at Dundalk which amounted to concerted action within the meaning of s. 4(1) of the 2002 Act and unlawful. The protests outside Dundalk racecourse in which Mr. Hyland was identified as participating were lawful.

    6. Court of Appeal

    Dismissing the appeal of Dundalk Racing against the trial judge’s findings, the Court of Appeal concluded that Rule 19 in the 2007 Pitch Rules meant that in the absence of a meeting and agreement between the AIR and the INBA as to how the Rules were to apply to all-weather racing, the Pitch Rules then currently in force remained applicable to all weather racing in Dundalk.

    The Court concluded there was not evidence to substantiate the finding of the trial judge that Mr. Hughes participated in the unlawful collective trade boycott of bookmakers who stood at Dundalk in 2007 and 2008.

    The Court also dismissed the appeal of Dundalk in respect of the failure of the High Court Judge to award damages against Mr. Hughes. Further, the declaration in relation to the unlawful trade boycott made on the counterclaim in each proceeding in the orders of 13th July 2015 will be vacated as there is no subsisting finding that any of the three plaintiffs participated in such boycott.

    The Court decided that the matters which the trial judge relied upon to support his conclusion that the bookmakers acted reasonably in refusing to agree to stand at Dundalk on the terms available in August 2007, were either not supported by the evidence or were matters to which he ought not to have had regard. In those circumstances, the Court considered the issue of mitigation de novo, while remaining mindful of the facts found by the trial judge

    Accordingly, the conclusion of the Court was that the bookmakers failed in their lawful obligations to mitigate their loss when they rejected the offer made by Dundalk on 8th August 2007 of terms on which they might stand at the redeveloped Dundalk racecourse. Had that offer been accepted the bookmakers would have been allocated pitches at Dundalk in accordance with the old seniority list and would have suffered no loss due to the breach of the Pitch Rules by Dundalk, save for the payment of €8,000, which could have been recovered in whatever proceedings they deemed appropriate.

    In conclusion, the appeals of Dundalk against the awards of damages were allowed and each of the awards of damages made in favour of the plaintiffs must be set aside.

    • by Seosamh Gráinséir for Irish Legal News

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