Francis Hyland v Dundalk Racing (1999) Ltd t/a Dundalk Stadium

• Jurisdiction: Ireland
• Judge: Mr. Justice Hogan
• Judgment Date: 19 February 2014
• Neutral Citation: [2014] IEHC 60
• Judgment citation (vLex): [2014] 2 JIC 1901
• Court: High Court
• Date: 19 February 2014

[2014] IEHC 60

THE HIGH COURT

[No. 907 P/2008]

Hyland v Dundalk Racing (1999) Ltd t/a Dundalk Stadium

BETWEEN/

FRANCIS HYLAND

PLAINTIFF

AND

DUNDALK RACING (1999) LIMITED TRADING AS DUNDALK STADIUM

DEFENDANT

HUGHES v DUNDALK RACING LTD T/A DUNDALK STADIUM & ASSOCIATION OF IRISH RACECOURSES LTD UNREP (CASE NO 2008/3304P)

COMPETITION ACT 2002 S4

MATTHEWS v IRISH COURSING CLUB 1993 1 IR 346 1992/8/2479

QUIRKE v BORD LUTHCHLEAS NA HEIREANN 1988 IR 83 1989 ILRM 129 1988/6/1650

JACOB v IRISH AMATEUR ROWING UNION LTD 2008 4 IR 731 2008/30/6618 2008 IEHC 196

IRISH HORSERACING INDUSTRY ACT 1994 PART III

ANDERTON & ROWLAND (A FIRM) v ROWLAND UNREP JACK 30.7.1999 (TIMES 5.11.1999)

COLLOONEY PHARMACY LTD v NORTH WESTERN HEALTH BOARD; HOLLY HILL PHARMACY LTD v SOUTHERN HEALTH BOARD 2005 4 IR 124 2005/11/2348 2005 IESC 44

IRISH HORSERACING INDUSTRY ACT 1994 S59

IRISH HORSERACING INDUSTRY ACT 1994 S59(1)

INDUSTRIAL RELATIONS ACT 1990

CONSTITUTION ART 40.6.1.ii

DPP v KEHOE 1983 IR 136 1983 ILRM 237 1983/1/244

CONSTITUTION ART 40.6.1

CONSTITUTION ART 40.6.1.i

CORNEC v MORRICE 2012 1 IR 804 2012/7/1939 2012 IEHC 376

CONSTITUTION ART 40.5

SULLIVAN v BOYLAN & ORS (NO 2) UNREP HOGAN 12.3.2013 2013 IEHC 104

CONSTITUTION ART 5

NON-FATAL OFFENCES AGAINST THE PERSON ACT 1997 S9

NON-FATAL OFFENCES AGAINST THE PERSON ACT 1997 S9(1)

NON-FATAL OFFENCES AGAINST THE PERSON ACT 1997 S9(2)

COMPETITION ACT 2002 S4(1)

CHICAGO BOARD OF TRADE v UNITED STATES 1918 246 US 231

SHERMAN ANTITRUST ACT 1890 S1 (USA)

TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 101

COMPETITION ACT 2002 S5

TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION ART 102

OSCAR BRONNER GMBH & CO KG v MEDIAPRINT ZEITUNGS-UND ZEITSCHRIFTENVERLAG GMBH & CO KG & ORS 1998 ECR I-7791 1999 4 CMLR 112

UNITED STATES v COLGATE & CO 1919 250 US 300

ALLEN v FLOOD & TAYLOR 1898 AC 1 1895-99 AER REP 52

QUINN v LEATHEM 1901 AC 495 1900-03 AER REP 1

A & N PHARMACY LTD v UNITED DRUG WHOLESALE LTD 1996 2 ILRM 42 1996/1/1

VERIZON COMMUNICATIONS INC v TRINKO 2004 540 US 398

BRITISH MIDLAND AIRWAYS LTD v AER LINGUS PLC 1993 4 CMLR 596

Litigation - Bookmakers - Contract - Regulations - Enforceability - Capital contribution - Interpretation of rules - Redevelopment of racecourse - Allocation of pitches - Anti-competitive practice - Collective boycott - Damage to competition - Competition Act 2002

Facts: In these proceedings, the defendant was the owner of the Dundalk racecourse, which had been subject to a €35 million redevelopment that had been completed in 2007. The plaintiff was a bookmaker who had purchased the no. 13 in the seniority list at Dundalk Stadium for IR£8,000 in the mid 1990"s. These proceedings arose when the plaintiff objected to the plans by the defendant to ask for a capital contribution of €8,000 to the cost of the redevelopment of Dundalk in exchange for taking a pitch at the racecourse when the new stadium re-opened. It was argued by him that pursuant to the Racecourse Executives" Seniority and Pitch Rules of 2007 ('the Pitch Rules'), the defendant was not entitled to ask for a payment from the bookmakers. As a result, the defendant sought a ruling from the Pitch Tribunal, which had the power to give binding interpretation of the Rules and to determine disputes arising thereunder. The defendant claimed that the ruling that was obtained made it clear that they could seek a capital contribution because the Pitch Rules did not apply to the allocation of pitches at a new racecourse. The plaintiff then brought proceedings to determine whether he was liable to pay the requested fee.

As well as the arguments that had been advanced prior to the ruling of the Pitch Tribunal, the defendant argued that the Pitch Rules were not enforceable by an individual bookmaker and that the Pitch Rules violated s. 4 of the Competition Act 2002 because they were anti-competitive. The defendant also argued that there was a collective boycott of bookmakers at the racecourse, which the plaintiff was a part of, that had the effect of damaging competition.

Held by Hogan J. that the context, wording and intent of the Pitch Rules made it clear that they were regulations to govern, inter alia, the relationship between individual bookmakers and individuals racecourses. It was also noted that individual bookmakers were personally bound to follow these Rules and operated for the benefit of all interested parties. As a result, it was determined that bookmakers affected by the operation of the Pitch Rules could potentially seek to legally enforce them in the same way that they could as if they were enforcing a contract. In regards to the decision of the Pitch Tribunal, it was held that although the wording of the judgment made it clear that the Pitch Rules did not apply to a new racecourse, it did not determine whether the redeveloped track at Dundalk constituted a new racecourse. In deciding that question, it was said that although the racecourse had undergone significant changes following redevelopment, it could not be described as a new racecourse given the clear continuity in terms of ownership, location, track and tradition. In regards to s. 4 of the Competition Act 2002, it was determined that the Pitch Rules provided a consistent pitch allocation system, which helped regulate the betting ring system. Because the betting ring system itself promoted open competition, it was held that the Pitch Rules could not be described as anti-competitive. For all these reasons, it was held that the defendant had not been entitled to ask the plaintiff for a capital contribution.

Finally, it was said that it was clear that there had been a collective boycott of bookmakers who took up pitches at the racecourse, which had seriously damaged competition. It was also said that the boycott amounted to anti-competiveness of the kind described in s. 4(1) of the 2002 Act. As a result, it was held that the Court would grant a declaration that the boycott was unlawful, and that it would, if necessary, be prepared in principle to grant an injunction directed at named persons preventing the continuation of the boycott.

PART I - INTRODUCTION

1 1. Sunday, 26 ^th August 2007 was an auspicious day in the annals of Irish horseracing, as on that day the first all weather racetrack in Ireland was opened at Dundalk racecourse. This major project had cost €35m. and entailed the construction of a major new stadium along with a new purpose built all weather track. The doyen of Irish racing journalists, the late lamented Colm Murray, was on hand to report on this major event for RTÉ. Yet what ought to have been an occasion for unalloyed joy and celebration was clouded by a bitter dispute between the racecourse (which is owned and operated by Dundalk Racing (1999) Ltd. ("Dundalk")) and the bookmakers who had heretofore frequented the course concerning the operation of what are known as the Pitch Rules.

2 2. This bitter dispute has abated but little in the intervening seven years. It colours the present proceedings which is but one of perhaps thirty or so similar claims brought by members of the bookmaking fraternity, of which the plaintiff is a prominent member. The plaintiff himself has held a bookmaker's licence since 1975 and he is currently the Honorary Secretary of the Irish National Bookmakers' Association. Sometime in the mid-1990s he purchased the no. 13 in the seniority list at Dundalk Stadium for the sum of IR£8,000. (The seniority concept is central to this case and it is explained in detail later in this judgment.)

3 3. The outcome of these proceedings also govern another companion case, John Hughes v. Dundalk Racing (1999) Ltd., 2008 No. 3304P. Mr. Hughes lives in Warrenpoint, Co. Down, just about 10 km. or so from Dundalk racecourse. He held the No. 2 seniority on the racecourse line, but in strictness he shared the No. 1 seniority with eleven other bookmakers. This seniority dates from 11 ^th October 1945, which was the date of the first meeting held at Dundalk under the auspices of the Racing Board. He was a prominent supporter of the racecourse, even to the point of sponsoring the last three races held on the course before it closed in September, 2001. Yet both he and Mr. Hyland (along with a majority of the other bookmakers who held seniority at Dundalk) objected strongly to the plans by Dundalk to ask for a capital contribution of €8,000 to the cost of the re-development of Dundalk when the new stadium re-opened in 2007. This is at the heart of the present dispute.

4 4. The proceedings themselves raise unusual and difficult issues in the fields of contract law, constitutional law and competition law. I will endeavour to summarise these issues at a later stage in this judgment, but it is first necessary to set out the factual background to this litigation, commencing with an outline of the nature and purpose of the Pitch Rules.

The Pitch Rules

5 5. The latest version of the Pitch Rules - or, to give them their formal title, the Racecourse Executives' Seniority and Pitch Rules - date from 2007. The background to and the evolution of these Rules is, however, a little more complex. In his evidence Mr. Hyland - who, in addition to being a prominent bookmaker, has surely an honoured place as a font of knowledge in all matters relating to the sporting and social history of racing and bookmaking - gave the Court what all acknowledged was a riveting account of the evolution of racing and bookmaking, with the specific reference to the evolution of these Rules. The account of that history which follows is based upon that evidence.

6 6. Racecourse bookmaking dates from the 1850s. Grandstands, cloak rooms, restaurants and bars were all built to facilitate the public. All of this facilitated bookmakers who had ready access to the racegoers. At that...