O'Hare & Hughes v Dundalk Racing (1999) Ltd (t/a Dundalk Stadium)
| Jurisdiction | Ireland |
| Judge | Mr. Justice Hogan |
| Judgment Date | 30 January 2015 |
| Neutral Citation | [2015] IEHC 198 |
| Court | High Court |
| Date | 30 January 2015 |
[2015] IEHC 198
THE HIGH COURT
AND
AND
Contract – Damages – Breach of Contract– Racecourse Executives' Seniority and Pitch Rules – Specific Relief.
Facts: The plaintiffs contended breach of contract by the defendant when asked to make certain payment in respect of debts relating to bookmaking. Earlier, Mr. Justice Hogan had held that the conduct of the defendant amounted to breach of contract of Pitch Rules in the first judgment in the case Hyland v. Dundalk Racing (1999) Ltd. [2014] IEHC 60. Following which the plaintiffs now sought an order for quantum of damages and mitigation of losses. The first named plaintiff sought specific relief by way of an injunction for the restoration of his original pitch to him.
Mr. Justice Hogan held that an order for quantum of damages and mitigation of losses would be granted. The Court observed that the plaintiffs were entitled to recover 100% of losses suffered in the first 12 months from when the racecourse reopened and there would be abatement of damages by a factor of 80% for subsequent years. The Court awarded the damages for the loss of pitches to the plaintiffs. The Court declined to grant specific relief by way of an injunction to the first named plaintiff restoring his original pitch to him due to excessive and unreasonable delay.
1. In these proceedings the plaintiffs claim damages by reason of a breach of contract on the part of the defendant racecourse operator. This matter has already been extensively dealt by me in my judgment in Hyland v. Dundalk Racing Ltd. [2014] IEHC 60 (" Hyland No. 1") and Hyland v. Dundalk Racing Ltd. (No.2) [2015] IEHC 57 (" Hyland No. 2"). The present claims accordingly represent the second and the third respectively of three test cases dealing with questions of damages and other relief which arise in the wake of my finding as to liability in Hyland (No.l). The three cases were heard one after each other (with some overlap in witnesses) in a 14 day hearing which addressed issues of quantum.
2. The following summary of the background facts must accordingly suffice for present purposes. Both plaintiffs held established seniorities to trade from a particular bookmaking pitches at Dundalk Racecourse. That racecourse closed in 2001 and reopened in August 2007 as an all-weather track following an enormous investment amounting to some €35m. The defendant ("Dundalk") sought a capital contribution of some €8,000 from each bookmaker holding a pitch at the racecourse. The plaintiffs claimed that this demand amounted to a breach of what are known as the Racecourse Executives' Seniority and Pitch Rules ("the Pitch Rules") and, hence, to a breach of contract.
3. In the first judgment in this case which was delivered by me on 19 th February 2014 ( Hyland v. Dundalk Racing (1999) Ltd. [2014] IEHC 60) I held that the Pitch Rules amounted to a legally binding contract and that the defendant had breached these Rules by seeking a payment of this kind from bookmakers holding established seniorities who wished to take a pitch at the re-opened racecourse. The essence of the decision was that the re-opened Dundalk Stadium did not amount to a new racecourse, at least for the purposes of the Pitch Rules, so that a payment of this kind could not be lawfully exacted from bookmakers (such as the plaintiffs) holding an established seniority at Dundalk. The nature and purpose of the Pitch Rules and the background to this dispute are all fully set out in that judgment. As I explained in that judgment, the Pitch Rules amounted to a detailed set of rules governing the allocation of pitches to bookmakers at the racecourse betting ring.
4. The present judgment deals solely with questions of mitigation of loss and the quantum of damages arising from the breach of contract findings in Hyland (No.l). Mr. O' Hare also claims to be entitled to an order restoring his specific pitch to him.
5. Mr. O' Hare claims the sum of €286,960 for lost profits by reason of an inability to trade at Dundalk in the period from August 2007 onwards. He also claims damages of €221,000 as the capital value of the pitch in the event that the pitch is not restored to him.
6. Mr. Hughes claims the sum of €483,560 for lost profits by reason of an inability to trade at Dundalk in the period from August 2007 onwards. He also claims damages in the sum of €60,000 in respect of the loss of his pitch.
7. This judgment is really in the nature of a supplementary judgment to those earlier judgments and it pre-supposes some familiarity with these decisions. For the sake of consistency and comprehensiveness, some of the analysis contained in Hyland (No.2) is reproduced in this judgment as well.
8. As the issue of mitigation of loss has been dealt with comprehensively in Hyland (No.2) I propose to apply the analysis and the findings contained therein to the present case. I will accordingly allow the plaintiffs to recover 100% of the losses he sustained in the first 12 months from August 2007 to August 2008. So far as subsequent years are concerned, then in line with the reasoning of Henchy J. in McCord v. ESB [1980] ILRM 183,I will abate these damages by a factor of 80%, reflecting the extent to which the failure by the plaintiff to mitigate his loss by taking up a pitch objectively amounted to such fault for the purposes of s. 34(1) of the 1961 Act as would justify the reduction of damages by this amount.
9. In making that assessment, I am endeavouring to reflect the fact that there was continuing fault on both sides. I also take into account the fact by the time of the February 2008 offer from Dundalk to allocate additional pitches on payment of the sum of €863, 14 pitches had already been allocated to the other pitch holders who had applied for them in August 2007 after the breakdown of the negotiations which had been held earlier that month between the Irish National Bookmakers Association, the Association of Irish Racecourses and Dundalk Racecourse.
10. By definition, therefore, any pitch which the plaintiff could then have taken up would have been decidedly inferior to his existing pitch. It followed that his loss could not have been completely mitigated in this manner, even if the February 2008 offer had then been taken up on a without prejudice basis.
11. In addition, however, in the specific case of Mr. Hughes, I will further abate his total damages by a factor of 20%. In my first judgment, I found that Mr. Hughes was one of the persons who had participated in the illegal boycott, although I refrained from actually naming him in that judgment. While it is only fair to say that, following a complaint to HRI, Mr. Hughes apologised profusely for his behaviour, it is nevertheless only appropriate that persons who engaged in illegal activity of this kind should have their damages for breach of contract reduced to reflect to a proportionate extent their degree of objective "fault" within the meaning of s. 34(1) of the Civil Liability Act 1961.
12. The next issue concerned the actual capital valuation of the pitches which were lost as a result of the re-draw based on seniority of permit holder which was held in August 2007. It is important to state that it was common case that given that there was a new betting ring at Dundalk, the Pitch Rules required that there would, in any event, have had to have been a re-draw. There was, however, a critical difference between the re-draw envisaged in such circumstances under the Pitch Rules and that which actually took place. Both Mr. O' Hare and Mr. Hughes held an October 1945 seniority, which seniority ranked ex aequo with ten other pitch holders. In the re-draw envisaged by the Pitch Rules either of them might, for example, have obtained the No. 1 pitch or they might have been relegated to the No. 12 pitch or they might have obtained pitches somewhere in between.
13. The re-draw which actually took place in August 2007 was one which was not sanctioned by the Pitch Rules, chiefly because Dundalk (wrongly) believed that the Pitch Rules did not apply in these circumstances. The re-draw was not based on the 1945 seniorities, but was rather based on the seniority of the permit holders of those bookmakers who (unlike these plaintiffs and the other 31 seniority holders) were prepared to pay the €8,000 capital contribution which Dundalk had asked for.
14. Mr. O' Hare gave evidence that he owned a 1945 seniority, namely, No. 3 on the Parade Ring Side. Two other members of the O' Hare family also owned 1945 seniorities. He stated that under no circumstances would his own pitch have been for sale. He personally valued the pitch at €225,000. Mr. Peelo explained this valuation on the basis that it represented the capital value to Mr. O' Hare, as distinct from the market value. In other words, the pitch was intensely valuable to Mr. O' Hare because it gave him the right to annual earnings of €45,000 which when capitalised (using a multiplier of five) came to €225,000. Mr. Peelo accepted, however, that not every bookmaker would be in a position to earn such sums even if this premier pitch were to be allocated to them.
15. Mr. Hughes gave evidence that he held pitch No. 2 on the Racecourse line which he acquired by purchasing it sometime in the 1980s for the sum of approximately IR£30,000. Mr. Hughes personally valued that pitch at somewhere in the region of €60,000.
16. The principal expert...
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Hyland v Dundalk Racing (1999) Ltd
...will refer as the ‘Hyland assessment judgment’. 3. A judgment delivered on 30th January 2015 in Mr. O' Hare and Mr. Hughes' proceedings [2015] IEHC 198 to which we will refer as the ‘O' Hare/Hughes assessment judgment’. Background to Dispute 2 The background to the dispute is fully set out......