Appeal RIU v PJ Scaife – Decision dated 25 September 2012
ID: JCA16475
Decision:
BEFORE THE APPEALS TRIBUNAL OF THE JUDICIAL CONTROL AUTHORITY
UNDER THE RACING ACT 2003
IN THE MATTER of the New Zealand Rules of Harness Racing
BETWEEN THOMAS RODNEY CARMICHAEL, Chief Racing Investigator for the Racing Integrity Unit (RIU)
Appellant
AND PETER JOHN SCAIFE of Foxton, Licensed Public Trainer
Respondent
Appeals Tribunal: Prof G Hall, Chairman - Mr K Hales, Member
Appearing: Mr C Lange for the appellant - Ms M Thomas for the respondent
Decision: 25 September 2012
DECISION OF APPEALS TRIBUNAL
[1] Following the filing of written submissions, the respondent admitted a charge that:
On the 9th day of February 2012, [he] was the trainer and person for the time being in charge of the horse Innes Lad which was presented to race in race 6, The Whistle Blowers Mobile Pace, at a race meeting conducted by the Manawatu Harness Racing Club at Manawatu Raceway, when a pre-race blood sample taken from Innes Lad was found upon analysis to have a TCO² level of 37.2 mmol/L, in breach of the provisions of Rule 1004(1A), 1004(1) and 1004(3) of the Rules of Harness Racing.
[2] Rule 1004 of the Rules of Harness Racing provides as follows:
(1) A horse shall be presented for a race free of prohibited substances.
(1A) A horse shall be presented for a race with a total carbon dioxide level at or below the level of 35.0 millimoles per litre in plasma.
(3) Where a person is left in charge of a horse, and the horse is taken or is to be taken to a racecourse for the purpose of engaging in a race, otherwise than in accordance with sub-rule (1), the trainer of the horse and the person left in charge both commit a breach of these Rules.
(7) Every person who commits a breach of sub-rule (2) or (3) shall be liable to: a fine not exceeding $20,000; and/or be disqualified or suspended from holding or obtaining a licence for any specific period not exceeding five years.
(8) A horse connected with a breach of sub-rule (1), (2) or (3) shall be disqualified from any race entered and/or liable to a period of disqualification not exceeding five years.
[3] The Judicial Committee (the Committee) imposed a penalty of a fine of $2,000 upon the respondent and disqualified the horse INNES LAD from race 6 pursuant to r 1004(8).
[4] The RIU has appealed against this penalty on the grounds that it is inadequate or inappropriate (r 1207(2)(b)) and has contended it should be quashed and that a disqualification for a period of 4 months should be substituted.
[5] With the consent of the parties we heard the appeal by way of the exchange of written submissions. We do not believe that we need the further assistance of oral submissions.
Facts
[6] We recount the summary of facts as recorded in the Committee’s decision of 22 June last.
Mr Scaife is a Public Trainer and Open Horseman. He has held a trainer’s licence for about 20 years.
On 9 February 2012 the horse, INNES LAD, was officially trained by Mr Scaife at Foxton.
On 9 February 2012, INNES LAD was correctly entered for and started in Race 6, The Whistler Blowers Mobile Pace, for horses with 2 wins for lifetime and horses with a claiming price up to and including $3,500 at a race meeting conducted by Manawatu Harness Racing Club at Manawatu Raceway. INNES LAD finished 10th of 12 starters in the race, was 11/11 in the betting and earned no stake money.
INNES LAD was one of twelve horses pre-race blood tested in Race 6. All twelve horses had previously been tested for TCO² levels.
The identification of the horse and the witnessing of the sample collection were carried out in accordance with the Regulations by the Veterinarian, Lucy Cahill, in the presence of the Racing Investigator and Mr Scaife. Mr Scaife signed the “Notice to Owner, Trainer, or Authorised Representative”.
On 16 February 2012, the Racing Laboratory reported that the sample from INNES LAD had recorded a TCO² level of 37.2 mmol/L.
Results from the 19 samples collected at the meeting ranged from 27.3 to 37.2 mmol/L. The second highest level recorded was 35.5.
INNES LAD had been tested on two previous occasions (32.6 on 24/4/2009 and 35.5 on 24/4/2011) and on one occasion subsequent to 9 February 2012 (32.3 on 23/2/2012).
Mr Scaife was interviewed at his stables on 20 February 2012. He has denied the administration of any alkali, by any means, to INNES LAD on 9 February 2012. He was unable to explain the elevated TCO² level that was recorded. He said that it was “a while ago” when he last used the product calcium propionate and he had none on his property.
On 22 February 2012, Stipendiary Stewards from the Racing Integrity Unit went to Mr Scaife’s stable in Foxton as part of a routine stable inspection in the area. Samples of two products found at the property were subsequently analysed by NZ Racing Laboratory Services. One, which did not contain any significant amount of calcium, was found to be creatine and not calcium propionate. The other was a product known as “Jet Breath” which was found to not contain calcium propionate but an amount of carbonate species, probably sodium bicarbonate.
Committee’s decision
[7] The Committee found that the informant had “not been able to present any evidence whatsoever of administration” and was not prepared to make a finding of administration in the absence of any such evidence, notwithstanding an article by Hibbert, Armstrong & Vine that had been referred to in the informant’s submissions (see [18], below). It observed that the informant acknowledged that it was not possible to establish who had been responsible for any administration to the horse.
[8] In determining that “a monetary penalty [would] suffice” the Committee stated that “it was persuaded” by two matters: Ms Thomas’s submission that fines were the norm for breaches of the prohibited substance rule and its predecessor, the so-called drug negligence rule; and, “in particular”, Jo 2010 and Ju 2012. The Committee also had regard to Mr Scaife’s good record and character, and his admission of the breach.
[9] In determining the quantum of the fine, the Committee used, as a starting point, the graduated scale of fines originally produced by HRNZ for charges arising out of elevated TCO² levels. The Committee also recognised that the fine had to reflect the fact that the maximum fine for a breach of r 1004 was increased by HRNZ in 2011 from $10,000 to $20,000.
Counsel’s submissions
[10] Mr Lange, counsel for the RIU, stated the Committee erred in that it was not prepared to make a finding of administration; and when it said that fines are “the norm” for a breach of the prohibited substance rule.
[11] He submitted that the adequacy and appropriateness of any penalty must be considered against:
• the purpose of the Rules;
• the purpose of the disciplinary proceedings;
• the standard of conduct expected of trainers; and
• an assessment of the circumstances which gave rise to a breach of the Rules.
[12] Mr Lange addressed each of these matters in turn. With respect to the purpose of the rules relating to prohibited substances, after citing a number of New Zealand and Australian authorities which emphasised the need for drug-free racing, he summarised this as being (at 8):
• to ensure that horses in the sport of racing compete on level terms and do so free of prohibited substances; and
• to maintain integrity in horse racing for the betting public with whom the financial well-being of the industry depends.
[13] His next submission was that judicial proceedings in racing were the sporting code’s disciplinary proceedings, and were akin to professional disciplinary proceedings. He quoted at length from the Supreme Court decision in Z v Complaints Assessment Committee [2009] 1 NZLR 1. The thrust of these passages was that the purpose of statutory disciplinary proceedings was to protect the public by ensuring appropriate standards of professional behaviour and not to punish, although it was recognised that often this would be the practical effect of the body’s decision.
[14] Mr Lange viewed the role of disciplinary proceedings in a racing context to be:
• to enforce a high standard of propriety to maintain the high standards and good reputation of a those involved in the sport; and
• to protect the betting public and others involved in the sport from future breaches by the individual or others who might be like-minded to breach the Rules.
[15] Mr Lange then cited cases that stated that the obligation upon a trainer under the prohibited substance rule was a heavy or an onerous one, requiring a high degree of vigilance in order to ensure drug-free racing.
[16] Finally, with regard to the need to address the particular circumstances of the case, Mr Lange stated that there was no set tariff for a breach of the prohibited substance rule. At one end of the spectrum there were cases where there was a complete absence of fault, such as the administration of a substance after a trainer made full enquiry with his or her veterinarian but received erroneous advice. At the other end of the spectrum were circumstances, which involved gross negligence or recklessness. Where the circumstances of the breach fell on this spectrum of seriousness was directly relevant to the penalty. By way of illustration, he said, where the breach arose but there was a complete absence of fault a fine, at most, might be appropriate and, in cases involving negligence, periods of suspension or disqualification would be appropriate.
[17] Mr Lange applied the principles he had identified to the facts of this case.
[18] He said the circumstances of the case under appeal were that the horse returned a TC02 level of 37.2 mmoi/L. The respondent denied administering an alkali substance to the horse. In a published paper Hibbert, Armstrong and Vine, “Total C02 Measurements in a Horse: Where to Draw the Line”, he said the authors had investigated the likelihood of a non-doped horse returning a positive test and had concluded:
For TC02 in horses, the present action threshold of 37.0 mmoi/L is quite generous and would give a chance of conviction of an innocent trainer of less than 2,000,000 to 1.
[19] Accordingly, he submitted (at 20) that the appropriate basis on which the Committee should have proceeded was that the elevated level in the respondent’s case was “more probable than not to have resulted from an administration of an alkaline substance to the horse.”
[20] The appellant submitted that the Committee had erred in its approach (at [40]) by not being prepared to make a finding of administration in the absence of evidence of administration. Mr Lange said the appellant was not alleging that the respondent had administered an alkali, but rather, based on the study by Hibbert et al, the elevated TC02 level arose from an administration by an unknown person. It followed, he said, the respondent’s conduct reflected a failure to have in place expected standards of security or control and such a failure was negligent.
[21] The second error made by the Committee, the appellant believed, was that it had proceeded on the basis that fines were the norm for breaches of the prohibited substance rule. In so doing, Mr Lange said, the Committee appeared to have overlooked the comments of the Appeals Tribunal in cases such as L (1998) where it was stated that it must be expected that repeat offenders and those guilty of high levels of negligence will incur periods of suspension; B (1998) where Bentley’s failure to put in place expected standards of control and security over the horse was a major aggravating feature and a strong warning was given that future cases could well be met with a period disqualification or suspension; and Justice (2012) where the Tribunal said: “Once a breach is established, general deterrence and denunciation are appropriate in imposing penalty. There is a need to bring home to trainers/owners the heavy responsibility of presenting horses free of prohibited substances. Previous penalties have failed to do this, as illustrated in decisions such as B.”
[22] Mr Lange concluded the appellant’s submissions by stating that the Appeals Tribunal had made it clear in a number of cases that fines were not the norm for a breach of the prohibited substance rule and in cases involving negligence periods of suspension or disqualification were appropriate. The circumstances of this case fell into a category where the elevated TC02 level arose from the respondent’s failure to have in place the expected standards of control and security of the horse. As the Appeals Tribunal in B had commented, a period of disqualification or at least suspension was appropriate.
[23] Mr Lange also drew attention to the fact that on 26 June 2011 the Racing Integrity Unit had issued a notice following 11 positive swabs in five months that it would be seeking harsher penalties for breaches of the rules relating to prohibited substances.
[24] The appellant submitted the appeal should be allowed and that a period of 4 months’ disqualification should be imposed.
[25] Ms Thomas, counsel for the respondent, agreed with the appellant’s summary of the purpose of the rules relating to prohibited substances that we have recorded at [12]. She agreed that the standard expected of trainers by r 1004(1) was a high one.
[26] Ms Thomas stated that the appellant’s submissions blurred the distinction between the actus reus under r 1001(1)(q), which was administration, and r 1004(1), which was presentation. She said the essential thrust of the appellant’s argument was that if a person admits to administering an alkaline substance he or she would be charged with administering, which was a strict liability offence. If a person denied administering an alkaline substance, he or she would be charged with presenting, which was an absolute liability offence. She further alleged that the informant would argue that because there was no other explanation for the level (or the presence) of the substance that person must have been responsible for the elevation/presence because it must have been administered. Because there had been administration (although not by the defendant as that was not the charge) the level or presence could only be because the person had failed to take reasonable precautions to ensure that the other person (whoever that person was) did not administer the substance. The informant, she said, would not bring any evidence to support what was the required duty of security or care, or evidence as to how the duty was breached.
[27] She expressed the view that the appellant’s submission that there was no tariff decision for a breach of the prohibited substance rule ignored the decision in Jones (2010). In that case the Judicial Committee accepted a graduated scale of penalties for elevated TCO² levels, as had been submitted by HRNZ. These were:
A reading under 36.2: prosecution would not be undertaken;
Between 36.2 and 37.2: the level of fine should be $500;
Between 37.3 and 38.5: a fine of $2,000 and/or suspension for a period in the vicinity of three months was appropriate;
Above 38.5: a fine in the region of $5,000 and/or disqualification of up to six months was appropriate.
The defendant in Jo was fined $2,000, as the TCO² reading was between 37.3 and 38.5. No period of disqualification was imposed.
[28] The respondent questioned the significance of the Hibbert et al study when the threshold level for TCO² was meant to be at a level that would not be reached but for the administration of an alkaline substance.
[29] The respondent also noted that the appellant did not clearly set out the standard of security or control that was expected of trainers in their stables nor the manner in which this standard was being breached, just that it was being breached because of the elevated TCO² level.
[30] Ms Thomas pointed out that the appellant had failed to identify any case that was authority for the proposition that a fine was not the norm for a first elevated TCO² breach.
[31] With reference to the RIU notice to trainers of 26 June 2011, Ms Thomas submitted that had the industry wished to, it could have, through the appropriate body, HRNZ, regulated for a “minimum” period of disqualification for first time breaches involving elevated TCO² levels. It had not done so.
[32] The respondent observed that HRNZ had increased the penalties for a breach of the prohibited substance rule since the RIU notice. The latest Rules (dated November 2011) had increased the monetary penalty from $10,000 to $20,000. There was no increase to the periods of suspension or disqualification. In its decision the Committee had specifically acknowledged, and taken into account, this increase to the maximum monetary penalty in determining the appropriate penalty for Mr Scaife.
[33] In his reply to the respondent’s submissions Mr Lange encapsulated his reasoning by stating that, in the context of the case under appeal, the fact that a horse had been administered an alkaline substance by persons unknown prior to racing, reflected a failure by the trainer to put in place the appropriate standards of proper care and vigilance, which was required at all times. Such conduct fell towards the upper end of the scale of culpability for which the appropriate sanction was a short term of disqualification.
Decision
[34] Rule 1004 provides that a horse be presented to race free of a prohibited substance. Where administration can be established, there is a separate rule, r 1001(1)(q), under which the charge can be laid and significantly harsher penalties apply, as this is deemed to be a serious racing offence.
[35] Understandably, both parties agree that the duties on trainers with respect to prohibited substances are high and appropriately so. As stated in Lamb, proper care and vigilance is required at all times at the stables and the track.
[36] We are satisfied that the Committee did not err in failing to find that it was more probable than not that the elevated level in INNES LAD was the result of an administration of an alkaline substance to the horse.
[37] There was simply no evidence before the Committee upon which it could have drawn such a conclusion. If the appellant wishes a committee to conclude from the authors of one article on the topic that a level of 37.2 is indicative of administration, then these persons, or at least the primary researcher, should be called to give evidence to substantiate their findings so they can, if necessary, be subject to cross examination as to the methodology adopted and the validity of the study. It might well be that a committee would be slow to draw the conclusion that there has been administration on the basis of only one study and might require there to be a more rigorous investigation of or more extensive submissions on the matter.
[38] Mr Lange has not sought to introduce this evidence on appeal and we believe he is correct to adopt this approach. There is nothing before us that would indicate that the appellant was not able to take the appropriate steps to adduce this evidence before the Committee. We would not therefore view this as fresh or new evidence that might lead us to direct that it be admitted on an appeal by way of rehearing (r 1205(2)).
[39] With reference to the wording of the passage from the Hibbert et al article, we assume “an innocent trainer” is a reference by the authors to the trainer of a horse that has reached the level of 37.0 mmo/L through natural means; ie as a consequence of the metabolism of this particular horse. In these circumstances a trainer would be found to be in breach of r 1004 through the application of absolute liability. As Justice (2012) demonstrates, frequently it will be impossible to determine how the horse came to have the elevated level and the appropriate charge will be one under r 1004. It would be rare for there to be independent evidence. An admission by a trainer is perhaps a more likely scenario. In these circumstances, a penalty less than that that imposed under the administration rule is likely to be appropriate, unless there is evidence of gross negligence. There is no such evidence in this case and we are most reluctant, indeed we believe it would most unfair to the respondent to draw such a conclusion simply on the basis of the level returned by the horse and the conclusions reached in a sole academic article.
[40] Ms Thomas is correct when she says the base TCO² level has been set on the basis that a horse cannot reach that level through “natural” means. The corollary of this is that the horse has ingested in some form a substance that has resulted in an elevated level. It may be that this “ingestion” is as a consequence of administration by persons unknown (as the Committee and this Appeals Tribunal have been asked to infer on the basis of the Hibbert article) but that is not a sufficient basis on which to reach a conclusion the trainer has been grossly negligent and, therefore, that an increased penalty is appropriate.
[41] A more helpful guide as to level of penalty is the extent to which the horse is over the legal maximum TCO² level, as established in Jones and earlier cases. We do not believe it is helpful or appropriate for a committee to conclude for the purpose of r 1004 that where the level is “high” (and we have not received any submission as to what the cutting point might be; on the basis of the Hibbert article, it could arguably be any point above 37.0) there has therefore been an administration by persons unknown and the penalty should be greater to reflect the licence holder’s negligence.
[42] We accept Mr Lange’s submission that an assessment of the circumstances as to how the prohibited substance came to be present in the horse is an appropriate consideration in assessing culpability for the purpose of penalty. However, there must be evidence before a committee to enable it to make such an assessment. As we have said, in this case there was simply no such evidence before the Committee.
[43] The appellant submits that what is required when determining the appropriate penalty for a breach of the prohibited substance rule is that there be an assessment of the circumstances, which gave rise to the breach; and where the culpability falls on the spectrum of seriousness.
[44] We accept Mr Lange’s submission that where the breach involves low culpability the appropriate sanction may be a monetary penalty; and cases at the other end of the spectrum involving high levels of negligence, in light of the decisions in L and B, may be met with penalties of suspension or disqualification. However in this case, there was simply no evidence before the Committee, in contrast to Bentley, of a failure to put in place expected standards of control and security over the horse, which was the major aggravating feature identified in that case.
[45] The parties agree it is imperative for the future of the industry that racing be perceived to be, and indeed is, drug free. To this end, in imposing penalty we believe the relevant considerations were correctly identified by the Appeals Tribunal in Ju (2012) when it stated at [81]:
Once a breach is established, general deterrence and denunciation are appropriate in imposing penalty. There is a need to bring home to trainers/owners the heavy responsibility of presenting horses free of prohibited substances.
[46] We accept the appellant is not barred in subsequent cases from arguing that a level of penalty indicated in an earlier case is no longer appropriate, especially where there has subsequently been notice (in this case, on 26 June 2011) by the RIU that it would be seeking harsher penalties for a breach of the prohibited substance rule.
[47] We accept, as did the Committee, that the increase in the maximum fine available for a breach of r 1004 requires reconsideration of the penalties scheduled in Jo (2010). We have not received submissions as to the manner in which the levels of penalty set out this case might be adjusted and, for this reason, we do not believe it is appropriate that we address this matter further.
[48] With respect to whether a fine is the “norm” for a breach of the prohibited substance rule, we do not believe the use of this expression is helpful in this context. The imposition of penalty is a fact specific exercise conducted with reference to the maximum penalties prescribed in the Rules and those imposed in comparator cases.
[49] To summarise with reference to the two matters identified by the appellant, which we accept to be relevant to penalty. The circumstances that gave rise to the breach are not known. Mr Scaife has accepted responsibility on the basis that r 1004 is one of absolute liability as held by an Appeals Tribunal in Ju 2012. Where the culpability falls on the spectrum of seriousness is best determined by reference to the extent to which the elevated level is in excess of the statutory limit.
[50] The penalty that is imposed upon Mr Scaife has to be at a level that protects the public by ensuring appropriate standards of professional behaviour. We can only interfere with penalty if it is inadequate or inappropriate (r 1207(2)(b)). The Committee correctly regarded as mitigating factors that this is the respondent’s first breach of this rule, he is of good character, and he has admitted the breach. We believe the fine of $2,000 is at the bottom of the range that was legitimately open to the Committee. It is thus not inadequate and it follows that we do not believe the imposition of a fine as opposed to a disqualification or a suspension is inappropriate.
Penalty:
We confirm the penalty and dismiss the appeal.
[51] We have not received submissions as to costs on this appeal. We now require submissions from counsel as to costs. To that end the following timetable is to apply:
• Ms Thomas is to file and serve on Mr Lange her submissions on costs within one week of the date of this decision;
• Mr Lange will have a further week from the date of receipt of Ms Thomas’s submissions to file his submissions in reply;
• Leave is reserved to apply if for any valid reason there is difficulty with this timetable.
Prof G Hall Mr K Hales
Chairman Member
25 September 2012
Appeal Decision: 7ab842de8fc85caf2df30f9b5849ca25
Decision Date: 04/10/2012
Publish Date: 04/10/2012
JCA Decision Fields (raw)
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decisiondate: 04/10/2012
hearing_title: Appeal RIU v PJ Scaife - Decision dated 25 September 2012
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appealdecision: 7ab842de8fc85caf2df30f9b5849ca25
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Decision:
BEFORE THE APPEALS TRIBUNAL OF THE JUDICIAL CONTROL AUTHORITY
UNDER THE RACING ACT 2003
IN THE MATTER of the New Zealand Rules of Harness Racing
BETWEEN THOMAS RODNEY CARMICHAEL, Chief Racing Investigator for the Racing Integrity Unit (RIU)
Appellant
AND PETER JOHN SCAIFE of Foxton, Licensed Public Trainer
Respondent
Appeals Tribunal: Prof G Hall, Chairman - Mr K Hales, Member
Appearing: Mr C Lange for the appellant - Ms M Thomas for the respondent
Decision: 25 September 2012
DECISION OF APPEALS TRIBUNAL
[1] Following the filing of written submissions, the respondent admitted a charge that:
On the 9th day of February 2012, [he] was the trainer and person for the time being in charge of the horse Innes Lad which was presented to race in race 6, The Whistle Blowers Mobile Pace, at a race meeting conducted by the Manawatu Harness Racing Club at Manawatu Raceway, when a pre-race blood sample taken from Innes Lad was found upon analysis to have a TCO² level of 37.2 mmol/L, in breach of the provisions of Rule 1004(1A), 1004(1) and 1004(3) of the Rules of Harness Racing.
[2] Rule 1004 of the Rules of Harness Racing provides as follows:
(1) A horse shall be presented for a race free of prohibited substances.
(1A) A horse shall be presented for a race with a total carbon dioxide level at or below the level of 35.0 millimoles per litre in plasma.
(3) Where a person is left in charge of a horse, and the horse is taken or is to be taken to a racecourse for the purpose of engaging in a race, otherwise than in accordance with sub-rule (1), the trainer of the horse and the person left in charge both commit a breach of these Rules.
(7) Every person who commits a breach of sub-rule (2) or (3) shall be liable to: a fine not exceeding $20,000; and/or be disqualified or suspended from holding or obtaining a licence for any specific period not exceeding five years.
(8) A horse connected with a breach of sub-rule (1), (2) or (3) shall be disqualified from any race entered and/or liable to a period of disqualification not exceeding five years.
[3] The Judicial Committee (the Committee) imposed a penalty of a fine of $2,000 upon the respondent and disqualified the horse INNES LAD from race 6 pursuant to r 1004(8).
[4] The RIU has appealed against this penalty on the grounds that it is inadequate or inappropriate (r 1207(2)(b)) and has contended it should be quashed and that a disqualification for a period of 4 months should be substituted.
[5] With the consent of the parties we heard the appeal by way of the exchange of written submissions. We do not believe that we need the further assistance of oral submissions.
Facts
[6] We recount the summary of facts as recorded in the Committee’s decision of 22 June last.
Mr Scaife is a Public Trainer and Open Horseman. He has held a trainer’s licence for about 20 years.
On 9 February 2012 the horse, INNES LAD, was officially trained by Mr Scaife at Foxton.
On 9 February 2012, INNES LAD was correctly entered for and started in Race 6, The Whistler Blowers Mobile Pace, for horses with 2 wins for lifetime and horses with a claiming price up to and including $3,500 at a race meeting conducted by Manawatu Harness Racing Club at Manawatu Raceway. INNES LAD finished 10th of 12 starters in the race, was 11/11 in the betting and earned no stake money.
INNES LAD was one of twelve horses pre-race blood tested in Race 6. All twelve horses had previously been tested for TCO² levels.
The identification of the horse and the witnessing of the sample collection were carried out in accordance with the Regulations by the Veterinarian, Lucy Cahill, in the presence of the Racing Investigator and Mr Scaife. Mr Scaife signed the “Notice to Owner, Trainer, or Authorised Representative”.
On 16 February 2012, the Racing Laboratory reported that the sample from INNES LAD had recorded a TCO² level of 37.2 mmol/L.
Results from the 19 samples collected at the meeting ranged from 27.3 to 37.2 mmol/L. The second highest level recorded was 35.5.
INNES LAD had been tested on two previous occasions (32.6 on 24/4/2009 and 35.5 on 24/4/2011) and on one occasion subsequent to 9 February 2012 (32.3 on 23/2/2012).
Mr Scaife was interviewed at his stables on 20 February 2012. He has denied the administration of any alkali, by any means, to INNES LAD on 9 February 2012. He was unable to explain the elevated TCO² level that was recorded. He said that it was “a while ago” when he last used the product calcium propionate and he had none on his property.
On 22 February 2012, Stipendiary Stewards from the Racing Integrity Unit went to Mr Scaife’s stable in Foxton as part of a routine stable inspection in the area. Samples of two products found at the property were subsequently analysed by NZ Racing Laboratory Services. One, which did not contain any significant amount of calcium, was found to be creatine and not calcium propionate. The other was a product known as “Jet Breath” which was found to not contain calcium propionate but an amount of carbonate species, probably sodium bicarbonate.
Committee’s decision
[7] The Committee found that the informant had “not been able to present any evidence whatsoever of administration” and was not prepared to make a finding of administration in the absence of any such evidence, notwithstanding an article by Hibbert, Armstrong & Vine that had been referred to in the informant’s submissions (see [18], below). It observed that the informant acknowledged that it was not possible to establish who had been responsible for any administration to the horse.
[8] In determining that “a monetary penalty [would] suffice” the Committee stated that “it was persuaded” by two matters: Ms Thomas’s submission that fines were the norm for breaches of the prohibited substance rule and its predecessor, the so-called drug negligence rule; and, “in particular”, Jo 2010 and Ju 2012. The Committee also had regard to Mr Scaife’s good record and character, and his admission of the breach.
[9] In determining the quantum of the fine, the Committee used, as a starting point, the graduated scale of fines originally produced by HRNZ for charges arising out of elevated TCO² levels. The Committee also recognised that the fine had to reflect the fact that the maximum fine for a breach of r 1004 was increased by HRNZ in 2011 from $10,000 to $20,000.
Counsel’s submissions
[10] Mr Lange, counsel for the RIU, stated the Committee erred in that it was not prepared to make a finding of administration; and when it said that fines are “the norm” for a breach of the prohibited substance rule.
[11] He submitted that the adequacy and appropriateness of any penalty must be considered against:
• the purpose of the Rules;
• the purpose of the disciplinary proceedings;
• the standard of conduct expected of trainers; and
• an assessment of the circumstances which gave rise to a breach of the Rules.
[12] Mr Lange addressed each of these matters in turn. With respect to the purpose of the rules relating to prohibited substances, after citing a number of New Zealand and Australian authorities which emphasised the need for drug-free racing, he summarised this as being (at 8):
• to ensure that horses in the sport of racing compete on level terms and do so free of prohibited substances; and
• to maintain integrity in horse racing for the betting public with whom the financial well-being of the industry depends.
[13] His next submission was that judicial proceedings in racing were the sporting code’s disciplinary proceedings, and were akin to professional disciplinary proceedings. He quoted at length from the Supreme Court decision in Z v Complaints Assessment Committee [2009] 1 NZLR 1. The thrust of these passages was that the purpose of statutory disciplinary proceedings was to protect the public by ensuring appropriate standards of professional behaviour and not to punish, although it was recognised that often this would be the practical effect of the body’s decision.
[14] Mr Lange viewed the role of disciplinary proceedings in a racing context to be:
• to enforce a high standard of propriety to maintain the high standards and good reputation of a those involved in the sport; and
• to protect the betting public and others involved in the sport from future breaches by the individual or others who might be like-minded to breach the Rules.
[15] Mr Lange then cited cases that stated that the obligation upon a trainer under the prohibited substance rule was a heavy or an onerous one, requiring a high degree of vigilance in order to ensure drug-free racing.
[16] Finally, with regard to the need to address the particular circumstances of the case, Mr Lange stated that there was no set tariff for a breach of the prohibited substance rule. At one end of the spectrum there were cases where there was a complete absence of fault, such as the administration of a substance after a trainer made full enquiry with his or her veterinarian but received erroneous advice. At the other end of the spectrum were circumstances, which involved gross negligence or recklessness. Where the circumstances of the breach fell on this spectrum of seriousness was directly relevant to the penalty. By way of illustration, he said, where the breach arose but there was a complete absence of fault a fine, at most, might be appropriate and, in cases involving negligence, periods of suspension or disqualification would be appropriate.
[17] Mr Lange applied the principles he had identified to the facts of this case.
[18] He said the circumstances of the case under appeal were that the horse returned a TC02 level of 37.2 mmoi/L. The respondent denied administering an alkali substance to the horse. In a published paper Hibbert, Armstrong and Vine, “Total C02 Measurements in a Horse: Where to Draw the Line”, he said the authors had investigated the likelihood of a non-doped horse returning a positive test and had concluded:
For TC02 in horses, the present action threshold of 37.0 mmoi/L is quite generous and would give a chance of conviction of an innocent trainer of less than 2,000,000 to 1.
[19] Accordingly, he submitted (at 20) that the appropriate basis on which the Committee should have proceeded was that the elevated level in the respondent’s case was “more probable than not to have resulted from an administration of an alkaline substance to the horse.”
[20] The appellant submitted that the Committee had erred in its approach (at [40]) by not being prepared to make a finding of administration in the absence of evidence of administration. Mr Lange said the appellant was not alleging that the respondent had administered an alkali, but rather, based on the study by Hibbert et al, the elevated TC02 level arose from an administration by an unknown person. It followed, he said, the respondent’s conduct reflected a failure to have in place expected standards of security or control and such a failure was negligent.
[21] The second error made by the Committee, the appellant believed, was that it had proceeded on the basis that fines were the norm for breaches of the prohibited substance rule. In so doing, Mr Lange said, the Committee appeared to have overlooked the comments of the Appeals Tribunal in cases such as L (1998) where it was stated that it must be expected that repeat offenders and those guilty of high levels of negligence will incur periods of suspension; B (1998) where Bentley’s failure to put in place expected standards of control and security over the horse was a major aggravating feature and a strong warning was given that future cases could well be met with a period disqualification or suspension; and Justice (2012) where the Tribunal said: “Once a breach is established, general deterrence and denunciation are appropriate in imposing penalty. There is a need to bring home to trainers/owners the heavy responsibility of presenting horses free of prohibited substances. Previous penalties have failed to do this, as illustrated in decisions such as B.”
[22] Mr Lange concluded the appellant’s submissions by stating that the Appeals Tribunal had made it clear in a number of cases that fines were not the norm for a breach of the prohibited substance rule and in cases involving negligence periods of suspension or disqualification were appropriate. The circumstances of this case fell into a category where the elevated TC02 level arose from the respondent’s failure to have in place the expected standards of control and security of the horse. As the Appeals Tribunal in B had commented, a period of disqualification or at least suspension was appropriate.
[23] Mr Lange also drew attention to the fact that on 26 June 2011 the Racing Integrity Unit had issued a notice following 11 positive swabs in five months that it would be seeking harsher penalties for breaches of the rules relating to prohibited substances.
[24] The appellant submitted the appeal should be allowed and that a period of 4 months’ disqualification should be imposed.
[25] Ms Thomas, counsel for the respondent, agreed with the appellant’s summary of the purpose of the rules relating to prohibited substances that we have recorded at [12]. She agreed that the standard expected of trainers by r 1004(1) was a high one.
[26] Ms Thomas stated that the appellant’s submissions blurred the distinction between the actus reus under r 1001(1)(q), which was administration, and r 1004(1), which was presentation. She said the essential thrust of the appellant’s argument was that if a person admits to administering an alkaline substance he or she would be charged with administering, which was a strict liability offence. If a person denied administering an alkaline substance, he or she would be charged with presenting, which was an absolute liability offence. She further alleged that the informant would argue that because there was no other explanation for the level (or the presence) of the substance that person must have been responsible for the elevation/presence because it must have been administered. Because there had been administration (although not by the defendant as that was not the charge) the level or presence could only be because the person had failed to take reasonable precautions to ensure that the other person (whoever that person was) did not administer the substance. The informant, she said, would not bring any evidence to support what was the required duty of security or care, or evidence as to how the duty was breached.
[27] She expressed the view that the appellant’s submission that there was no tariff decision for a breach of the prohibited substance rule ignored the decision in Jones (2010). In that case the Judicial Committee accepted a graduated scale of penalties for elevated TCO² levels, as had been submitted by HRNZ. These were:
A reading under 36.2: prosecution would not be undertaken;
Between 36.2 and 37.2: the level of fine should be $500;
Between 37.3 and 38.5: a fine of $2,000 and/or suspension for a period in the vicinity of three months was appropriate;
Above 38.5: a fine in the region of $5,000 and/or disqualification of up to six months was appropriate.
The defendant in Jo was fined $2,000, as the TCO² reading was between 37.3 and 38.5. No period of disqualification was imposed.
[28] The respondent questioned the significance of the Hibbert et al study when the threshold level for TCO² was meant to be at a level that would not be reached but for the administration of an alkaline substance.
[29] The respondent also noted that the appellant did not clearly set out the standard of security or control that was expected of trainers in their stables nor the manner in which this standard was being breached, just that it was being breached because of the elevated TCO² level.
[30] Ms Thomas pointed out that the appellant had failed to identify any case that was authority for the proposition that a fine was not the norm for a first elevated TCO² breach.
[31] With reference to the RIU notice to trainers of 26 June 2011, Ms Thomas submitted that had the industry wished to, it could have, through the appropriate body, HRNZ, regulated for a “minimum” period of disqualification for first time breaches involving elevated TCO² levels. It had not done so.
[32] The respondent observed that HRNZ had increased the penalties for a breach of the prohibited substance rule since the RIU notice. The latest Rules (dated November 2011) had increased the monetary penalty from $10,000 to $20,000. There was no increase to the periods of suspension or disqualification. In its decision the Committee had specifically acknowledged, and taken into account, this increase to the maximum monetary penalty in determining the appropriate penalty for Mr Scaife.
[33] In his reply to the respondent’s submissions Mr Lange encapsulated his reasoning by stating that, in the context of the case under appeal, the fact that a horse had been administered an alkaline substance by persons unknown prior to racing, reflected a failure by the trainer to put in place the appropriate standards of proper care and vigilance, which was required at all times. Such conduct fell towards the upper end of the scale of culpability for which the appropriate sanction was a short term of disqualification.
Decision
[34] Rule 1004 provides that a horse be presented to race free of a prohibited substance. Where administration can be established, there is a separate rule, r 1001(1)(q), under which the charge can be laid and significantly harsher penalties apply, as this is deemed to be a serious racing offence.
[35] Understandably, both parties agree that the duties on trainers with respect to prohibited substances are high and appropriately so. As stated in Lamb, proper care and vigilance is required at all times at the stables and the track.
[36] We are satisfied that the Committee did not err in failing to find that it was more probable than not that the elevated level in INNES LAD was the result of an administration of an alkaline substance to the horse.
[37] There was simply no evidence before the Committee upon which it could have drawn such a conclusion. If the appellant wishes a committee to conclude from the authors of one article on the topic that a level of 37.2 is indicative of administration, then these persons, or at least the primary researcher, should be called to give evidence to substantiate their findings so they can, if necessary, be subject to cross examination as to the methodology adopted and the validity of the study. It might well be that a committee would be slow to draw the conclusion that there has been administration on the basis of only one study and might require there to be a more rigorous investigation of or more extensive submissions on the matter.
[38] Mr Lange has not sought to introduce this evidence on appeal and we believe he is correct to adopt this approach. There is nothing before us that would indicate that the appellant was not able to take the appropriate steps to adduce this evidence before the Committee. We would not therefore view this as fresh or new evidence that might lead us to direct that it be admitted on an appeal by way of rehearing (r 1205(2)).
[39] With reference to the wording of the passage from the Hibbert et al article, we assume “an innocent trainer” is a reference by the authors to the trainer of a horse that has reached the level of 37.0 mmo/L through natural means; ie as a consequence of the metabolism of this particular horse. In these circumstances a trainer would be found to be in breach of r 1004 through the application of absolute liability. As Justice (2012) demonstrates, frequently it will be impossible to determine how the horse came to have the elevated level and the appropriate charge will be one under r 1004. It would be rare for there to be independent evidence. An admission by a trainer is perhaps a more likely scenario. In these circumstances, a penalty less than that that imposed under the administration rule is likely to be appropriate, unless there is evidence of gross negligence. There is no such evidence in this case and we are most reluctant, indeed we believe it would most unfair to the respondent to draw such a conclusion simply on the basis of the level returned by the horse and the conclusions reached in a sole academic article.
[40] Ms Thomas is correct when she says the base TCO² level has been set on the basis that a horse cannot reach that level through “natural” means. The corollary of this is that the horse has ingested in some form a substance that has resulted in an elevated level. It may be that this “ingestion” is as a consequence of administration by persons unknown (as the Committee and this Appeals Tribunal have been asked to infer on the basis of the Hibbert article) but that is not a sufficient basis on which to reach a conclusion the trainer has been grossly negligent and, therefore, that an increased penalty is appropriate.
[41] A more helpful guide as to level of penalty is the extent to which the horse is over the legal maximum TCO² level, as established in Jones and earlier cases. We do not believe it is helpful or appropriate for a committee to conclude for the purpose of r 1004 that where the level is “high” (and we have not received any submission as to what the cutting point might be; on the basis of the Hibbert article, it could arguably be any point above 37.0) there has therefore been an administration by persons unknown and the penalty should be greater to reflect the licence holder’s negligence.
[42] We accept Mr Lange’s submission that an assessment of the circumstances as to how the prohibited substance came to be present in the horse is an appropriate consideration in assessing culpability for the purpose of penalty. However, there must be evidence before a committee to enable it to make such an assessment. As we have said, in this case there was simply no such evidence before the Committee.
[43] The appellant submits that what is required when determining the appropriate penalty for a breach of the prohibited substance rule is that there be an assessment of the circumstances, which gave rise to the breach; and where the culpability falls on the spectrum of seriousness.
[44] We accept Mr Lange’s submission that where the breach involves low culpability the appropriate sanction may be a monetary penalty; and cases at the other end of the spectrum involving high levels of negligence, in light of the decisions in L and B, may be met with penalties of suspension or disqualification. However in this case, there was simply no evidence before the Committee, in contrast to Bentley, of a failure to put in place expected standards of control and security over the horse, which was the major aggravating feature identified in that case.
[45] The parties agree it is imperative for the future of the industry that racing be perceived to be, and indeed is, drug free. To this end, in imposing penalty we believe the relevant considerations were correctly identified by the Appeals Tribunal in Ju (2012) when it stated at [81]:
Once a breach is established, general deterrence and denunciation are appropriate in imposing penalty. There is a need to bring home to trainers/owners the heavy responsibility of presenting horses free of prohibited substances.
[46] We accept the appellant is not barred in subsequent cases from arguing that a level of penalty indicated in an earlier case is no longer appropriate, especially where there has subsequently been notice (in this case, on 26 June 2011) by the RIU that it would be seeking harsher penalties for a breach of the prohibited substance rule.
[47] We accept, as did the Committee, that the increase in the maximum fine available for a breach of r 1004 requires reconsideration of the penalties scheduled in Jo (2010). We have not received submissions as to the manner in which the levels of penalty set out this case might be adjusted and, for this reason, we do not believe it is appropriate that we address this matter further.
[48] With respect to whether a fine is the “norm” for a breach of the prohibited substance rule, we do not believe the use of this expression is helpful in this context. The imposition of penalty is a fact specific exercise conducted with reference to the maximum penalties prescribed in the Rules and those imposed in comparator cases.
[49] To summarise with reference to the two matters identified by the appellant, which we accept to be relevant to penalty. The circumstances that gave rise to the breach are not known. Mr Scaife has accepted responsibility on the basis that r 1004 is one of absolute liability as held by an Appeals Tribunal in Ju 2012. Where the culpability falls on the spectrum of seriousness is best determined by reference to the extent to which the elevated level is in excess of the statutory limit.
[50] The penalty that is imposed upon Mr Scaife has to be at a level that protects the public by ensuring appropriate standards of professional behaviour. We can only interfere with penalty if it is inadequate or inappropriate (r 1207(2)(b)). The Committee correctly regarded as mitigating factors that this is the respondent’s first breach of this rule, he is of good character, and he has admitted the breach. We believe the fine of $2,000 is at the bottom of the range that was legitimately open to the Committee. It is thus not inadequate and it follows that we do not believe the imposition of a fine as opposed to a disqualification or a suspension is inappropriate.
sumissionsforpenalty:
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penalty:
We confirm the penalty and dismiss the appeal.
[51] We have not received submissions as to costs on this appeal. We now require submissions from counsel as to costs. To that end the following timetable is to apply:
• Ms Thomas is to file and serve on Mr Lange her submissions on costs within one week of the date of this decision;
• Mr Lange will have a further week from the date of receipt of Ms Thomas’s submissions to file his submissions in reply;
• Leave is reserved to apply if for any valid reason there is difficulty with this timetable.
Prof G Hall Mr K Hales
Chairman Member
25 September 2012
hearing_type: Non-race day
Rules: 1004(1), (1A) and (3)
Informant: TR Carmichael - Chief Racing Investigator representing the Racing Integrity Unit
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Respondent: PJ Scaife - License Public Trainer
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