Appeal RIU v S Lawson – Reserved Decision (Reasons) for Decision of Appeal Tribunal dated 13 May 2019 – Chair, Hon J W Gendall QC

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hearing_title: Appeal RIU v S Lawson - Reserved Decision (Reasons) for Decision of Appeal Tribunal dated 13 May 2019 - Chair, Hon J W Gendall QC

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BEFORE THE APPEAL TRIBUNAL OF THE JUDICIAL CONTROL AUTHORITY

UNDER THE RACING ACT 2003 and in the matter of an appeal under Part XII of the NZ Rules of Harness Racing

BETWEEN RACING INTEGRITY UNIT (RIU)

Appellant / Informant

AND SIMON LAWSON

Licensed Open Horseman and Public Trainer

Respondent

APPEAL TRIBUNAL

Hon J W Gendall QC – Chair

Mr L N McCutcheon – Member

APPEARANCES

Mr S Symon and Ms E Smith for RIU

Ms M-J Thomas for Simon Lawson

Present: Messrs A Cruickshank and N Grimstone (RIU)

Messrs Rob Lawson and Hank Habraken

Mr Simon Lawson did not attend

Hearing held at Hamilton on May 6 2019

Reserved Decision (Reasons) for Decision of Appeal Tribunal

[1] This is an appeal by the Racing Industry Unit (RIU) against a penalty decision of a Judicial Committee of the JCA, delivered on 5 March 2019, imposing sanctions upon Simon Lawson, a licensed horseman, for breaches of a Rule of Harness Racing deemed to be “Serious Racing Offences”.

[2] A licensed horseman (driver) he had admitted two charges of offending against Rule 505(1) of the New Zealand Rules of Harness Racing, they being serious racing offences under Rule 505(2). The essence of the charges were that he:

(a) On 25 May 2018 he bet on a horse MR NATURAL in a race at Alexandra Park, Auckland in which he drove another horse MY ROYAL RUBY. His futures bet was $50 to win (at TAB bookmakers odds of 35-1) and $50 to place (at odds 6-1).

(b) On 20 July 2018 he bet on a horse MADAM CONNOISTRE in a race at Alexandra Park Auckland in which he drove another horse ZIYAD. His futures bet was $100 to win (at TAB bookmakers odds of 21-1 and $100 to place (at odds of 3.50-1).

[3] After hearing submissions from the RIU and on behalf of Mr Lawson, the Judicial Committee imposed penalties (concurrent for each offence):

(a) Suspension of his open horseman licence for a period of 18 months from 15 January 2019 until 31 July 2020.

(b) A fine of $8000.

(c) (By a later decision) that he pay costs of $3500 to the RIU and $1000 to the JCA.

[4] The RIU has appealed against those orders contending that they are manifestly inadequate.

[5] Appeals are by way of rehearing except to the extent the Appeal Tribunal otherwise directs. Evidence was not formally given before the Judicial Committee which proceeded on submissions by counsel and the representatives of the parties. The Committee did not decide the truth or otherwise of certain facts in the summary of facts, that Mr Lawson said he disputed. Instead the Committee said the validity of those allegations would not have been material to its decision. We have the benefit of a transcript of the hearing and the submissions made by counsel and Mr Lawson’s lay advocate and the answers to questions put by the Committee.

[6] We had directed that if Mr Lawson continued to dispute any particular fact or allegation contained in the summary of facts, then as a preliminary matter a "disputed facts" hearing had to take place. Those facts contained in the RIU Summary of Facts, then disputed, were;

(a) “Mr Dixon was also fully aware that Mr Lawson was driving [another horse] in Race 10”.

(b) “Mr Lawson explained [to Mr Habraken] that he was unable to place the bet as he was driving another horse in the same race [on 20 July 2018]”.

(c) “Mr Lawson stated that the betting voucher he created was for the benefit of himself and Mr. Dixon and they usually bet together. He also stated that Mr Dixon had previously placed bets for him when he was unable to as he was driving in a race”.

[7] Mr Simon Lawson did not attend at the Appeal hearing so we have not heard from him, but his counsel advised us that there need not be a disputed facts hearing as the facts contained in the prosecution Summary of Fact were no longer in dispute. We make it clear that this only means that Mr Lawson SAID those things and not necessarily the truth of them as they may implicate others.

[8] Although an appeal is a rehearing, nevertheless careful consideration is always given to the initial Committee’s decision. It was comprehensive, encompassing 77 paragraphs. It sets out in detail the submissions for the RIU and Mr Lawson, the background circumstances, and discussion of other cases referred to it (such as Walker, Rasmussen, Bull, Ahern, and McDonald). The reasons given by the Committee in declining the submission of the RIU that a disqualification of up to 3 years was necessary, we distill as follows:

(a) Although this was a "serious racing offence" it arose out of a “Betting Offence” rule and followed on two “mistakes”.

(b) The breaches "could fairly be described as stupidity".

(c) The offences did not involve "race fixing".

(d) A "crushing" penalty was not required; Mr Lawson had pleaded guilty at an early stage; he had been frank with the police and the RIU, was remorseful, and rehabilitation was important.

(e) There was a distinction between "the corrupt practice rule” and the seriousness of his actions.

(f) The impact of disqualification would be serious on him and have untoward effects upon other licence holders (his training partner father) and those with whom he dealt as a trainer.

(g) There were mitigating personal factors such as previous good character, being a successful junior driver, and said to be attending counselling to address problem gambling (if such was his problem).

FACTUAL SUMMARY

[9] Mr Lawson is aged 27 years and had been a licensed horseman and trainer (in partnership with his father) in harness racing. He did not acknowledge to the Judicial Committee any serious gambling problem or worrying betting habits, although he had said to the police he had a “gambling problem.” He saw a counsellor after becoming aware of the RIU inquiry but before charges were laid. In terms of his exchanges with the Judicial Committee there was some suggestion that counselling may have been undertaken in efforts to avoid disqualification. But counselling has happened although the committee was told (confirmed to us) that he was still gambling but not as much. He has been a good friend of fellow licensee Gareth Dixon for some time.

[10] On 24 May 2018, together with Mr Dixon, he placed a shared cash bet of $100 cash at the Patumahoe Hotel TAB on a combination of multi bets spanning five races at the Manawatu Harness race meeting taking place that day. They had the good fortune to win $744.70 for such wager.

[11] In the afternoon of the next day, 25 May 2018, Mr Lawson and Mr Dixon were together at the Pukekohe TAB. They obtained a betting voucher as a means of collecting their winnings from the Manawatu Harness wagers. Over about the next 10 minutes a number of bets were made using the credit voucher (and additionally a cash bet of $50 by Mr Dixon).

[12] Four minutes after receiving the voucher, Mr Dixon in the presence of Mr Lawson, placed a two leg multi bet using the joint voucher, on two separate races to be run that night at the Auckland Trotting Club meeting at Alexandra Park. That bet was for their joint benefit. It was on race 6 (LA PRIX for a place at fixed odds 3.8 -1) and race 10 (MR NATURAL for a place at fixed odds 6-1). Mr Lawson was to drive another horse in race 10. If each horse in the multi bet ran into a place the return for $40 would have been $912. Less than a minute later Mr Lawson, having been given the voucher, used it to place a $100 bet on LA PRIX ($50 to win at odds 18-1 and $50 to place at odds 3.80 -1. It eventuated that LA PRIX was unplaced so that bet as well as the multi bet failed.

[13] At the same time as the each way LA PRIX bet, Mr Lawson used the voucher to place bets of $50 to win at 35-1 odds, and $50 to place at 6-1 odds, on MR NATURAL in race 10.

[14] Under a minute later Mr Dixon placed a cash bet of $20 to win and $30 to place, at the same odds, on MR NATURAL in race 10.

[15] Three hours later, Mr Dixon, who then had possession of the voucher, was at the Patumahoe Hotel TAB. He used the voucher to place further bets on MR NATURAL - $25 to win and $25 to place (by then the fixed odds had reduced to 25-1 win and 4.5 place).

[16] We find that this was a joint bet for the benefit (if successful) of both men. After it succeeded, the proceeds were shared 50/50 by both men. Although not the subject of a charge before the Committee, this was a separate bet or wager at different odds to that earlier made. It is a compelling inference from all the factual circumstances that Mr Lawson must have known of this additional wager and shared in its return.

[17] The horse driven by Mr Lawson in race 10 finished 7th and MR NATURAL won. Mr Lawson was seen to be making celebratory gestures as the horses pulled up on the track after the finish. No doubt this was because he realised that the joint voucher bets were to yield $2304 (apart for the cash bet of Mr Dixon which returned $674 which was not shared apparently).

[18] The betting voucher was used again on 1 June 2018 to place a futures bet of $200 on a thoroughbred apprentice jockeys challenge, which failed.

[19] On 5 June 2018 Mr Lawson, having received back the voucher from Mr Dixon in the interim, cashed it in at the Pukekohe TAB. He received $2552.20 which cash was shared 50/50 with Mr Dixon.

[20] Later, on 19 July 2018, Mr Lawson was at the Pukekohe TAB, and gave $200 cash to a friend, Jon Habraken, a licensed stable hand. He asked him to place bets of $100 to win (at fixed odds of 21-1) and $100 to place (at fixed odd of 3.5-1) on a horse, MADAME CONNOISTRE in race 1 at the Auckland Harness Club meeting the following night. Mr Lawson was to drive another horse in that race. He said to Mr Habraken words to the effect "Can you back one for me tomorrow night? Don't tell anyone.” The summary of facts state that he told Mr Habraken that he was unable to bet as he was driving another horse in the same race. He made Mr Habraken a party to his offence once his assistance was obtained, with Mr Habraken then knowing of the dishonest action and of course once Mr Lawson drove in the race. MADAME CONNOISTRE finished second and the horse driven by him finished last. Having received the betting slip from Mr Habraken, he collected $350.

[21] Mr Lawson was interviewed by the police and an RIU investigator in 2018 over alleged betting “irregularities”. He admitted the offences and, amongst other statements, said:

• he accepted he was jubilant at the completion of the race won by MR NATURAL
• he won over $1000 on his joint bets with Mr Dixon
• he had driven his horses in each race to the best of his ability and “on their merits”
• his asking Mr Habraken to bet for him was the first time he had done that with him
• apart from these two occasions he had never bet on another horse in a race in which he was driving a competitor
• he had a gambling problem
• he had previously had Mr Dixon place bets for him on races in which he had a drive

PRINCIPLES APPLICABLE

[22] The Judicial Committee referred to the emphasis to be given to deterrence – both specific and general. It regarded as "aposite" (sic) comments made in an Australian sentencing case, relied upon by counsel that:

"the sentence should not exceed that which is proportionate to the moral turpitude involved in the crime having regard both to the objective character of the wrongdoing and the qualities of the offender"

[23] The Committee acknowledged that those remarks were made in the context of criminal sentencing and make no mention of the need to protect the reputation of a profession and public confidence in it and its integrity. That is something to which we return later.

[24] Principles of sentencing in criminal cases as set out in the Sentencing Act 2002 may give some guidance to judicial committees, depending on the nature of the offences, but there are other features which are important in disciplinary cases. In Criminal cases principles include holding an offender accountable; promoting in him or her a sense of responsibility; denouncing the offending conduct; deterring the offender and others; providing for the interests of any victims; protection of the community; assisting in the rehabilitation and reintegration of the offender. Some well-known factors that Judges take into account include the gravity of the crime, the blameworthiness of the offender, the maximum penalty provided, the desirability of consistency, the personal circumstances and characteristics of the offender which may make a sentence disproportionately severe on that person. Whilst those principles may be applicable in some disciplinary cases, they are not exclusive.

[25] Proceedings under the Rules of Harness Racing, as is the position in all cases involving professional disciplines, are designed not simply to punish the transgressor, but crucially are to protect the profession/public/industry/and those who are to deal with the profession. Disciplinary sanctions are designed for some important different purposes, and although guidance can be gained from the criminal jurisdiction, there are broader considerations. The Harness and Thoroughbred racing "industry " is a profession where key participants are required to be licensed in order to practice in various ways within that sphere. Comprehensive rules of practice, behavior, procedure and the like are set down in extensive detail in the Rules which govern the codes and behavior. As with most professions, a careful internal disciplinary and regulatory process is set up. Those who practice within professions (whether law, accountancy, medicine, teaching, real estate, and the like) are subject to sanctions for breaches of standards of conduct or rules designed to protect members of the profession as well as the public. Such sanctions can at the highest end include removal from a profession for serious breaches of professional rules and standards involving dishonest or immoral conduct. Such behavior if unchecked may greatly harm the reputation of the profession and "bring it into disrepute" – that is, the public loses confidence in it.

THE GENERAL PURPOSE OF DISCIPLINARY SANCTIONS

[26] The range of sanctions available to disciplinary tribunals will vary widely according to the nature of the profession. Most will have the power to:

• exclude from membership
• suspend from membership
• reprimand or admonish
• order a fine and/or costs
• order publication

[27] For a Serious Racing Offence under Rule 1001, the sanctions are fine, costs, suspension or disqualification. Clearly the latter is the most severe sanction. In many professions it is frequently imposed where the professional has acted dishonestly or unethically, or so far outside the standards required of him/her as to forfeit the privilege of working within the profession. Although naturally severe sanctions will "hurt" the transgressor, the primary purpose of sanctions by the regulatory body is not punitive in nature but is to:

• protect members of the public
• maintain public confidence in the profession
• declare an uphold proper standards of conduct, performance and behaviour

[28] A common thread in cases involving serious misconduct is for the regulatory tribunal generally to focus on the interests and reputation of the profession as a whole as being more important than the fortunes of the individual offending member. Of course, Tribunals are required to consider all available sanctions, starting with the lowest; and a sanction must be sufficient, but no more than is necessary to achieve its purpose. The Tribunal must endeavour to reach a proportionate balance between:

• the public interest
• the interests of the offending member
• the interests of the professional body as a whole
• the seriousness of the offending
• any aggravating and mitigating factors.

[29] Mitigation may include evidence of adherence to good practice and unblemished record, acceptance of wrongdoing (which ought to include, insight, genuine remorse), remedial actions, personal factors (eg stress, illness). Aggravating factors may include repeated misconduct, intentional/ deliberate actions, poor personal record, harm or adverse impact of the offending on the public, members of the profession, and others.

[30] Exclusion from the profession is obviously the most serious sanction. As we have said in many professional disciplinary cases it is likely to be imposed as appropriate when the behaviour is fundamentally incompatible with being a member of that profession. Serious failure to act with complete honesty and integrity may lead to exclusion as the consistent approach is that dishonesty undermines confidence and trust in the profession. Where there has been serious lack of probity and deliberate dishonesty, exclusion from a profession has often followed.

[31] We have set out in some detail the foregoing general considerations often applied in disciplinary cases, so that those involved in the wide racing industry realise that the disciplinary sanction and penalty process is not the same as that adopted in a court. The Rules and decided cases make it clear that such Rules apply to any and all persons who acts so as to bring himself within their purview. Counsel, and the public, understand that the sport is dependent on the scrupulous honest, probity and integrity of licence holders and others and the imposition of sanctions does not necessarily equate to that of the criminal sentencing process. The standard of proof on the balance of probabilities, as well as the general enquiry process and the Rules which give broad powers to a Judicial Committee illustrate the difference.

[32] The 5th Schedule to the Rules of Harness – relating to practice and procedure, make this clear, namely that the purpose of proceedings before a judicial or appeals committee include:

(a) to ensure racing is conducted in accordance with the code rules;

(b) to uphold and maintain the high standards expected of those participating in the sport of racing and the racing industry;

(c) to uphold and maintain the integrity of the sport of racing and the racing industry

(d) and to protect the participants in the sport of racing, the racing industry, and the public.

Nothing could be more clear.

[33] Furthermore, the imposition of general penalties in the Rules relating to disqualification and suspension (Rules 1301 -1304) can be ameliorated with the offender seeking some exemption for its effect through obtaining the Board's consent to certain activity (R 1303 (d) - (f)) and to apply under R1205 for cancellation after the expiration of the remainder of a disqualification after a certain period.

DECISION

[34] Counsel for the RIU submitted that a period of disqualification must follow for this offending and that the Judicial Committee erred in imposing an inappropriate sanction of 18 months suspension of the Open Horseman licence and a fine (substantial as that was). The RIU contend the penalty was manifestly inadequate. Counsel for Mr Lawson submitted that not only was disqualification disproportionate and not required, likewise the order for suspension and substantial fine was outside the range of applicable penalties and was manifestly excessive. She submitted that disqualification was inconsistent with penalties imposed by committees in a number of cases involving betting breaches. We have carefully considered those cases.

[35] There no longer being any dispute to the summary of facts, we conclude that Mr Lawson did tell Mr Dixon or make him aware (so he thought) that he was driving in the MR NATURAL race. Whether or not Mr Dixon heard or understood what he was told is not for us to decide, not having heard from him. Mr Lawson told the police and investigators that he believed this and that there were bets at other times that he had when another person bet for him. Mr Dixon unquestionably placed the later joint bet (although not the subject of the charge) of $25 each way at the Patumahoe TAB, the winning proceeds of which were shared. Likewise it is clear beyond doubt that Mr Lawson told Mr Habraken that he was driving in the race in which the $100 each way bet was placed, as he was unable to bet as he had a drive. Whatever Mr Habraken believed is not material to Mr Lawson’s guilt, as he knew he was driving another horse and knew why he was asking for his friend to place the bet.

[36] The actions of Mr Lawson comprised serious racing offences. Rule 505(1) is clear that a driver may not bet on any horse in a race in which he is driving and to bet on a horse other than one he / she is driving can properly be seen as more grievous He knew of the absolute prohibition, yet went ahead to twice successfully wager on longish odds horses. To wager or bet is simply to offer an amount one is prepared to risk in the hope of winning more from an undecided future event. That is what he was doing in races in which he was a competitor. He hoped the success of others would enable his wagers to succeed even if he was to drive to the best of his ability.

[37] Depending on its nature, a "serious racing offence" under Rule 1001 is widely defined as containing a common thread or element of dishonesty, corruption, willful (deliberate) neglect or breaches of duty or Rules. The Rule parallels the former "corrupt practice " rule, and indeed the words "corruptly", "fraudulently", surreptitiously" appear in a large number of the clauses in R1001. “Corruptness” is not contained as a necessary element of a charge under Rule 505 (1), (Rasmussen was said to be an oversight) but where there is deliberate, premeditated dishonesty - as we find to be the case here – there can be corrupt behavior which aggravates the offending. The actions of Mr Lawson cannot be explained away or minimised simply as "betting rule breaches or charges,” as counsel submitted to the Judicial Committee. In parts of its decision, the Committee appeared to accept that submission (yet not entirely) where it says:

"the breaches that were admitted were not ones involving a corrupt practice but were breaches of the betting Rule" (para [71])

[38] We take that the Committee meant that Mr Lawson did not face a merits charge and did not admit any dishonest/corrupt practice. But his actions were dishonest involving repeated, surreptitious, fraudulent secretive conduct or elements of corruption, knowing them to be wrongful and seriously in breach of his obligations as a driver. To be “corrupt” is to act willingly and dishonestly for personal or financial gain. That is what Mr Lawson did. He used others to assist in hiding what he was doing, and placed them in separate jeopardy should the events come to light. He would have hidden the fact of his wagers on other horses from the trainers and connections of the horses he drove, giving them no opportunity before the races of terminating his engagements. Having successfully earned significant reward from one race, he was apparently eager to bet $200 through Mr Habraken seeking further rewards aimed at over $2400 if successful.

[39] We agree with the Judicial Committee that the cases of Rasmussen, Bull, McDonald and Ahern do not assist measurably in determining the proper sanction in this case and Walker has only one similarity in that only one offence was riding in a race when betting, whereas he was guilty of the more grievous “merits” offence in respect of another race, which led to the deserved lengthy disqualification. It does not help us. In Rasmussen the decision said her breach only involved “oversight” which is far from the position with Mr Lawson. The other cases referred to us involved drivers betting on their own horse (although some were involved in “Boxed” bets). Bull upon which counsel relied, was a charge under a different penalty rule than the present “serious racing offence” rule, with a very reduced maximum penalty, and the decision said his actions arose “more from stupidity and stupidness than they did from any carefully conceived plan to breach the Rules. That is far from the case with Mr Lawson.

[40] Mr Lawson placed moderately sizeable bets at significant odds on two horses (not his own) in separate races in which he was driving. He did not have to drive. Without that there would have been no offending. As the Judicial Committee said “his actions have challenged the integrity of racing”. We agree. What he did - twice - strikes at the very credibility, integrity, probity and transparency of the sport of harness racing which it is vitally dependent upon in order to thrive. It is axiomatic that no participant in any sporting contest should wager on losing to an opponent –that is the bottom line of Mr Lawson’s action.

AGGRAVATING FACTORS OF THE OFFENDING

[41] They include

• offending twice, the second after achieving success on the first
• involving other licence holders so as to place them in jeopardy of facing charges, although Mr Dixon placed the later $25 each way bet at Patumahoe there was no charge in respect of that but was an aggravating separate joint bet for Mr Lawson’s benefit – but of course in the same race
• deliberate, dishonest actions where he was not mistaken of the Rules or his obligations. He twice acted dishonestly. The Judicial Committee’s comment that his offences “could fairly be described as stupidity” (para 67) is benevolent, and seeks to minimise the deliberate and dishonest actions, and we do not agree with it.

[42] There are no aggravating factors (eg past history for example) personal to Mr Lawson requiring any uplift from a starting point that is required for his offending.

MITIGATING FACTORS

[43] Personal factors of Mr Lawson submitted by his counsel before the Judicial Committee and us include:

• his good character and having been a successful junior driver
• his hitherto unblemished record and guilty plea at “first instance”
• his attendance at gambling counselling
• he did not lie about the offending and was cooperative at all times with the police and RIU
• he was and still is “extremely remorseful”
• his early acknowledgement of guilt and plea
• he has impressive character references which are before us.

[44] The discount for cooperation claimed on behalf of Mr Lawson has to be seen in the light of his attempting to resile from his earlier statements, giving evidence in another case (said in the published decision to be a “far from convincing witness”) and shifting his explanations to the police and investigators – yet now accepting before this Appeals Tribunal that the facts of what he said are not disputed. His “cooperation” has not been unqualified. That does not seem to accord genuine co-operation, remorse or insight. Of course, it is not an aggravating personal factor but counsel’s claims or credit for cooperation are to be seen in that light. Cooperation is a feature of genuine remorse.

[45] As to claims to remorse, it is well known that there is often a claim of remorse when there is merely regret or sorrow for the offender’s own predicament. As the Supreme Court said in Hessell v R SC102/2009 [2010] NZSC 135:

“Remorse is not necessarily shown by simply pleading guilty. Sentencing judges are very much aware that remorse may well be no more than self-pity of an accused for his or her predicament and will properly be sceptical about unsubstantiated claims that an offender is genuinely remorseful. But a proper and robust evaluation of all the circumstances may demonstrate a defendant’s remorse. Where remorse is shown by the defendant in such a way, sentencing credit should properly be given separately from that of the plea“ (para 64)

[46] No doubt Mr Lawson is sorrowful for his predicament but the Judicial Committee, and we, have only heard that in the form of counsel’s submission, and we have not heard directly from him. We have to assess whether there is true remorse and insight into his offending, by evaluating all the circumstances which may illustrate true remorse. If, objectively viewed, he was genuinely remorseful and insightful after the first offence he would not have reoffended again hoping for financial gain. He is still gambling but ”not as much”. His attempt to resile from statements he made to the police and investigators (given he now accepts he said those things) does not si

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