Non Raceday Inquiry – NZTR v Ms L K Cropp Decision on Penalty 05 June 09

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hearing_racingtype: thoroughbred-racing

startdate: 01/01/2001

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decisiondate: no date provided

hearing_title: Non Raceday Inquiry - NZTR v Ms L K Cropp Decision on Penalty 05 June 09

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Decision:

BEFORE THE JUDICIAL CONTROL AUTHORITY
 
UNDER THE RACING ACT 2003 AND IN THE MATTER of the New Zealand Rules of Racing

BETWEEN BRYAN F McKENZIE     Racecourse Inspector     Informant

AND LISA KATHRYN CROPP     Licensed jockey     Defendant

JUDICIAL COMMITTEE: Prof G Hall  Chairman
                                            Mr P Welch  Member

HEARING DATE:  20 May 2009

APPEARING:  Mr S Moore SC and Mr B Dickey for the Informant
                         Mr A Shaw for the Defendant

DECISION OF JUDICIAL COMMITTEE AS TO PENALTY DATED 5 JUNE 2009
 
 
Background
[1] In our decision of 11 March last this Committee found information number 64994 to be proved and, as a consequence, that the defendant was in breach of R 528 of the Rules of Racing, in that she presented herself to ride at the Te Rapa racecourse on 7 May 2005 and a sample of urine taken from her at that time contained the prohibited drugs methamphetamine and amphetamine.

BEFORE THE JUDICIAL CONTROL AUTHORITY
 
UNDER THE RACING ACT 2003 AND IN THE MATTER of the New Zealand Rules of Racing

BETWEEN BRYAN F McKENZIE     Racecourse Inspector     Informant

AND LISA KATHRYN CROPP     Licensed Jockey     Defendant

JUDICIAL COMMITTEE: Prof G Hall  Chairman
                                            Mr P Welch  Member

HEARING DATE:  20 May 2009

APPEARING:  Mr S Moore SC and Mr B Dickey for the Informant
                         Mr A Shaw for the Defendant

DECISION OF JUDICIAL COMMITTEE AS TO PENALTY DATED 5 JUNE 2009
 
 
Background
[1] In our decision of 11 March last this Committee found information number 64994 to be proved and, as a consequence, that the defendant was in breach of R 528 of the Rules of Racing, in that she presented herself to ride at the Te Rapa racecourse on 7 May 2005 and a sample of urine taken from her at that time contained the prohibited drugs methamphetamine and amphetamine.

[2]  In our minute of 19 March we required the parties to prepare written submissions as to penalty and costs. One day, (May 20) was also set down for the hearing of oral submissions. Written submissions were prepared by both the informant and the defendant, however in neither case were these submissions received by this Committee by the appointed time, with the defendant’s submissions not being received until the afternoon of 19 May (the day prior to the hearing).

[3] The general penalty provision is R 1003 which, so far as it is relevant, provides as follows:
“(1) Every person who … commits or is deemed to have committed a breach of these Rules or any of them, or any sub-Rule of any of them for which no penalty is provided elsewhere in these Rules shall be liable to:
(a) be disqualified for a period not exceeding 12 months; or
(b) suspended from holding or obtaining a licence, permit, certificate or registration for a period not exceeding 12 months …; and/or
(c) a fine not exceeding $10,000.”

[4] No penalty is provided elsewhere in the Rules for a breach of R 528.

Counsel’s submissions as to penalty

[5] In written and oral submissions, which emphasised the gravity of the defendant’s conduct and the need both for a deterrent penalty and to uphold the integrity of racing, the informant asked for the imposition of the maximum penalty that is available under the Rules: 12 months’ disqualification and a fine of $10,000.

[6] Mr Shaw for the defendant submitted that Ms Cropp’s level of culpability, as found by this Committee, should attract a moderate penalty in line with the penalties imposed on first-time offenders. A deterrent penalty was not required, he said, but if this Committee considered such a penalty to be appropriate, it would be severely disproportionate for us to impose the maximum penalties available.

[7] At the hearing we sought further information from the defendant as to the effect upon her of disqualification and, in particular, the extent of her involvement in the racing industry at the present time; and also with respect to her ability to pay any financial penalty or costs. The defendant responded by way of written submissions dated 27 May. The informant did not wish to reply to these submissions.

Decision as to penalty
[8] We first note R 1122(2), which provides:
“On finding a breach proved the Judicial Committee may impose any penalty provided by these Rules. In imposing a penalty provided in these Rules the Judicial Committee may have regard to such matters as they consider appropriate including: … (d) the need to maintain integrity and public confidence in racing.”

[9] This leads us to take as guiding principles:
(a) the need to hold the defendant accountable for her actions — the penalty imposed must reflect the gravity of the defendant’s conduct and punish her for her wrongdoing — it must be a realistic punishment but not excessively retributive;
(b) the need to denounce the defendant’s conduct — in our Ruling No. 5 of 14 February 2007 we identified at para [68] that the primary purpose underpinning R 528 and the NZTR jockey drug testing regime is a concern with health and safety issues to ensure that jockeys, who are prepared to take controlled drugs or illicit substances do not ride and thereby endanger themselves, and fellow jockeys. (We are fortified in our conclusion by the fact that this statement was approved in Cropp v A Judicial Committee [2008] 3 NZLR 774 where the Supreme Court stated at para [28]: “The opinion of the Judicial Committee, endorsed by the High Court, that the racing of horses is potentially very dangerous is amply justified, as is their opinion that drug-use increases that inherent danger.”) With reference to a US decision (Dimeo v Griffin 943 F.2d 679 (1991) at 683), the Court said the underlying point concerning the enhancing of the risk in an already dangerous occupation cannot be denied;
(c) the interests of specific and general deterrence — the penalty must deter the defendant from re-offending and it must also deter jockeys (or more accurately “riders”) from committing like offences. All persons involved in the racing industry need to be given a clear signal that the use or consumption of prohibited drugs will not be tolerated;
(d) the need to prevent the defendant from re-offending by means of her removal from the industry through the imposition of a penalty of disqualification;
(e) the interest of assisting, where possible, with the defendant’s rehabilitation, thereby inducing her to abide by the Rules in the future. There has been no acceptance by the defendant of her wrongdoing, but rather a steadfast denial of having consumed the drug methamphetamine, and, in addition, a reaffirmation in her submissions as to penalty, that the methamphetamine found in her urine may have been as a result of the “spiking” of liquids consumed by her on the day, and she had said in her evidence that there had been such an opportunity. In this regard, we accept counsel for the informant’s submissions that there is no supporting evidence from any source, either directly or inferentially, which would lead this Committee to draw this conclusion. Thus, we believe there is little foundation upon which we can build or fashion a reformative penalty. That said, we do not overlook the defendant’s personal circumstances, which we refer to later in our decision.

[10] Both counsel referred us to NZTR v JJM (Hamilton, 8 May 2009) where a penalty of 9 months’ disqualification was imposed. M was one of a number of riders randomly sampled at Matamata racecourse on 22 April and he returned a positive test to the drugs methamphetamine and amphetamine. He admitted to smoking that drug the previous day. M’s level is not identified in the decision. He had a previous breach of R 528, in respect of the Class C drug cannabis, some 2 years earlier, and had been fined $450 on that occasion. Unlike Ms Cropp, M pleaded guilty at the first opportunity, he had a previous conviction, and acknowledged he had a problem with drugs and had undergone treatment and counselling. We can only obtain limited assistance from this case in that, unusually, no starting point is identified in the decision but presumably it must have been close to or at the maximum period of disqualification. No additional fine was sought by NZTR.

[11] A more helpful decision is that in NZTR v EL (Palmerston North, 14 July 2006) where a term of 5 1/2 months’ disqualification was imposed upon a remorseful first offender who, like the defendant, had returned a positive result to methamphetamine. L admitted the breach. Again, no additional fine was sought by NZTR. A very significant factor in this case was “the shared view of all parties at the hearing that L’s use of methamphetamine was an isolated incident intended to assist her wasting efforts for her raceday commitments.” It was this feature that persuaded the Committee in EL to temper what would otherwise have been a significant period of disqualification. The Committee in that case commented:
“The use of amphetamines, methamphetamine or other Class A drugs by any licensed person in racing must be met with a level of penalty which will deter not only the offender but also others. The sentence must also serve to maintain the integrity of racing and advance public confidence in the industry. Those affected by these substances when working in the industry present considerable risk and potential harm to other participants.”

[12] We endorse these comments.

[13] We approach the imposition of penalty by first adopting the starting point which we believe to be appropriate for the defendant’s breach of R 528, and then, by factoring in aggravating and mitigating factors personal to the offender, we will move upwards and/or downwards from that point.

[14] Mr Moore for the informant, in response to questioning from this Committee, resiled from contending (as he had in his written submissions) for a starting point at the maximum period of disqualification and indicated that a lesser starting point, but one close to the maximum, was appropriate. We believe this concession to be appropriate. In determining the gravity of the defendant’s conduct we make reference to both the nature of the drugs to which Ms Cropp has returned a positive test and also the level of that result. Rule 528 encompasses all classes of drugs prescribed in the Misuse of Drugs Act 1975: Class A, Class B and Class C. Clearly a breach which involves the consumption of a Class A drug is to be viewed more seriously than one related to Class B or Class C drugs. The reading was extremely high. The defined cut-off point for the Class A drugs methamphetamine and amphetamine is 300 nanograms. At an estimated level of 20,000 to 30,000, the defendant’s level of methamphetamine was far in excess of this mark.

[15] These factors, in our view, point to a very serious breach of the Rules. But, that said, we can envisage a worse case scenario. In our decision of 11 March we indicated we were not satisfied that Ms Cropp had deliberately set out to frustrate the testing process; nor had she deliberately put her finger in the urine sample in order to tamper with it; nor had she tried to avoid being drug tested on the day. This was a random test, and had there been placed before us evidence to the effect that it was readily apparent the defendant was under the influence of a drug when she presented herself for riding, we would have adopted a starting point at the maximum. However, the defendant’s riding did not cause any riding mishap, and indeed those persons that witnessed her riding (eg the stipendiary stewards and the witness, Mr Trevor McKee) did not notice any adverse effects as a consequence of her consumption of the drug, methamphetamine. There was no evidence before this Committee as to any concern regarding Ms Cropp’s riding performance on the day in question: she rode 3 winners and a second placing. We also observe the defendant gave a clear sample on 12 May, the day that she was notified of the result of the 7 May test, and she has given numerous clear samples subsequently.

[16] We believe a starting point close to the maximum is appropriate and take a starting point of 10 1/2 months’ disqualification. There are no personal aggravating factors. With reference to mitigating factors, there has been no evidence of remorse nor any acceptance of guilt, and thus no reduction from our starting point is appropriate for these factors. This is a significant distinguishing feature from the decision in NZTR v EL where, as we have previously noted, a 5 1/2 month disqualification was imposed. However, Ms Cropp has not previously breached this Rule and is otherwise of good character. Indeed, she is an extremely successful rider who has been held in high regard by members of the racing community over a number of years. We believe these factors merit a discount of six weeks. Thus the period of disqualification is 9 months.

[17] We turn to the issue of whether a fine in addition to the penalty of disqualification is appropriate. We believe a period of disqualification by itself, while forcing the defendant to distance herself from the racing industry would be an inadequate response. We do not overlook the financial implications that disqualification will entail. Ms Cropp has described her involvement in the industry in written supplementary submissions which were received by this Committee on 27 May. She states that she has been unable to ride since October 2008 due to injuries and that she has been developing her training property as a source of future income. She further states that disqualification would not allow her access to training tracks and trial meetings with either her own or her clients’ horses, which would be crippling financially and would seriously affect long-term client relationships. These are unfortunate but inevitable consequences of disqualification and are matters which the defendant should have considered before presenting herself for riding with the drugs methamphetamine and amphetamine in her system.

[18] The informant submitted that a significant fine was called for given the financial gain to the defendant since she tested positive. Under the Rules of Racing, as they then were, Ms Cropp was entitled to continue riding. In these circumstances, we believe the earnings of the defendant during the period of the hearing of the matter to be irrelevant to our determination of the appropriate penalty.

[19] The primary influence upon our decision to impose a fine is the fact that we are firmly of the view that the defendant’s actions require a stern response from this Committee. Ms Cropp was prepared to ride with an extremely high concentration of methamphetamine in her system, with obvious attendant safety risks to not only herself, but other jockeys and their respective mounts. As the Supreme Court noted at para [30]:
“Counsel sought to say that there has been no evidence that drug-taking by jockeys is a particular problem in the racing industry but the unfortunate consequences of the taking of drugs in the community generally are too well known to need confirmation by evidence and there can be no reason to believe that jockeys as an occupational group are more likely to be abstinent than the general population.”

[20] In our view, the defendant’s conduct was not only in breach of the Rules of Racing but was foolhardy in the extreme. The need to firmly denounce such conduct should not need to be re-stated by this Committee. This is a serious breach of the Rules, which has brought the sport of thoroughbred racing into disrepute. This feature is exacerbated by the fact that the defendant is a high profile jockey, well known to and respected by not only followers of racing but many persons in the general community. We have regard to the totality of the penalty we impose, and also the quantum of the order for costs, and again we do not consider that the maximum fine is either necessary or appropriate. However, a fine at a similar level to the period of disqualification (ie 75% of the available maximum) is necessary in the interests of denunciation and deterrence. The defendant is fined the sum of $7,500.

[21] We feel constrained to comment that it gives this Committee no pleasure to have to impose these penalties upon such a well-respected and talented jockey, who has achieved so much in the sport and who has been a role model for many aspiring jockeys, female jockeys, in particular. We believe this breach of R 528 and the consequent penalties illustrate and, indeed highlight, the insidious nature of the drug methamphetamine and the serious consequences that can arise from its consumption. This should be a salutary lesson for any person in the industry who might be tempted to use the drug for recreational or weight loss purposes.

Costs
[22] This Committee also has the power to order costs pursuant to R 1122(3), which  states:
“The Judicial Committee may order that all or any of the costs and expenses of:
(a) any party to the hearing;
(b) any other person granted permission to be heard at the hearing by direction of the Judicial Committee;
(c) Thoroughbred Racing and/or any employee or officer thereof, or
(d) the Judicial Control Authority and the Judicial Committee
be paid by such person or body as it thinks fit….”

[23] This Committee thus has a wide discretion conferred upon it to order costs, which may relate to a broad range of individuals who have participated in the hearing.

Counsel’s submissions as to costs
[24] The informant submitted that costs should be awarded against the defendant.

[25] The informant’s costs with respect to the hearing before this Committee were originally set out in schedule B, which was attached to their written submissions. Mr Moore in his oral submissions informed us that only 2 counsel were charged for and that well in excess of 100 hours were written off. He also said the figure in schedule B did not include costs associated with the hearing as to penalty. The informant stated the length of the hearing was “extraordinary”, with the aggregate time of the hearing being in excess of 3 weeks. The informant alleged that the hearing of the case before this Committee was prolonged due to the several procedural points taken by the defendant and, in particular, the “no case” submissions and the cross-examination of witnesses on so-called “collateral matters”. The informant also submitted that from day one he put the defendant on notice that if she wanted to protract the hearings by taking technical points, in the event that the informant was successful, “she would pay”. The informant asked that the order for costs be of the order of 80% of the outgoings in order to reflect the fact that the defendant had caused NZTR significant costs in carrying out its duties as the industry regulator.

[26] In his oral submissions Mr Moore stated that the defendant’s case had been “characterised by a wanton disregard for the rights and courtesies which were deserving of others while these proceedings took place while steadfastly asserting that her own rights, whether real or illusory, needed to be maintained.” In the penultimate paragraph of his submission as to costs, he submitted this Committee should send a clear message to the industry that “if defendants unnecessarily delay and prolong a proceeding such a tactic will be reflected in costs”.

[27] The defendant resisted an order of the magnitude of 80% of the amount scheduled, submitting that the amount claimed by the informant was “extravagant and excessive having regard to all the circumstances”, and there was no justification for the award of what effectively was a claim for indemnity costs. The defendant submitted that no award of costs should be made in the absence of a fully-itemised breakdown of the amount of legal fees claimed by the informant, and the opportunity for Ms Cropp to comment on such a breakdown. The right to a fair hearing and the rules of natural justice, the defendant said, required such a process. The defendant further submitted that the opening by the informant on the basis that the defendant had deliberately set out to frustrate the testing process and the failure by the informant to accept that the Bill of Rights Act applied had prolonged the hearing. She asked this Committee to award only a modest contribution towards the costs of the hearing of the matter.

[28] Although Mr Moore assured us that the informant’s figures were accurate, Mr Shaw submitted that there should be some documentation before this Committee. In addition, we had no figures before us as to the Judicial Control Authority’s costs. We thus directed in a Ruling dated 29 May that the Judicial Control Authority provide us with a total figure broken down by the various heads of costs. We also directed that the informant itemise the “legal fees” component of his costs figures.

[29] The Judicial Control Authority responded to our direction and provided a figure of $66,979.06, which was broken down by heads of costs, including venue, accommodation, travel, stenographer, conference calls, and panellists fees. The informant reiterated disbursements were $16,733.65 and that legal costs, including invoices for 29 April and 28 May were $100,947.32. This is a total of $117,680.97. Adding informant’s and Judicial Control Authority’s costs we reach a figure of $184,660.03. Having regard to the length of the hearing and the complexity of the issues raised, there is nothing in these figures to suggest that they are not reasonable costs.

[30] Following the receipt of these figures, the defendant made further written submissions dated 2 June, to which the informant replied by way of written submissions dated 4 June, and to which the defendant responded on 5 June.

Decision as to costs
[31] As we have previously noted, this Committee is vested with a broad discretion to order costs, but we accept that any award has to be “fair and reasonable” and is not intended to indemnify any party nor to punish the defendant.

[32] This Committee is aware that in the wider legal system the guiding principle is that, except where there is a special reason for awarding costs on a solicitor/client basis, orders should be limited to a reasonable contribution towards the successful party’s costs on a party/party basis – that is to say, fair and reasonable costs including fees, charges, disbursements, expenses and remuneration incurred by a party in enforcing or defending his or her rights.

[33] Counsel for the informant referred us to two decisions relating to disciplinary bodies. The first was Vasan v Medical Council of New Zealand (HC, Wellington CP43/91, 18 December 1991, Eichelbaum CJ, Jeffries and Greig JJ) where $180,000 by way of costs was ordered — a significant amount for that time (the decision itself notes it is “exceptionally high and will cause hardship to a person in the appellant’s position”) and still a large award in today’s terms. The Court said, at p 15: “We do not wish anything we have said to derogate from the right of any person to defend charges levelled against him but say simply if he adopts that course, with full knowledge of the consequences of cost awards should his defence be unsuccessful, then it is a decision for which he must accept the financial responsibility.”

[34] The second case was Moore v Nursing Council (HC, Wellington AP100/00, 18 December 2000, Gendall J). The award in that case was for $14,420 and was not one of full indemnification. The Court said if there was no order for costs the profession would be left to carry the financial cost for disciplinary proceedings. With an order for 50% of costs, the profession was observed to still bear a burden.

[35] These cases recognise that it is appropriate that the costs of the enforcement of the relevant provisions (in this case, the Rules of Racing) be borne partly by the regulator (NZTR) and partly by the industry participant (the defendant). Our research has found the decision in Cooray v The Preliminary Proceedings Committee (HC, Wellington AP23/94, 14 September 1995, Doogue J) to contain a helpful survey of the cases. This sweep reveals that the proportion of the actual costs ordered varies according to the facts and circumstances of the particular case but, as was established in Cooray, disciplinary bodies have in a general way taken 50% of total reasonable costs as a guide to a reasonable order for costs, and have in individual cases, where the tribunal has considered it to be justified, gone beyond that figure. The High Court in that case found there was nothing in the defendant’s conduct, personal circumstances or the manner in which he conducted his case that justified the Council imposing costs in excess of the 50% figure, which the Court described as being the “apparent benchmark”. An award at the level of 75% was reduced to 50%.

[36] We are aware that an award at the level of 66% was made by an Appeals Tribunal in C v NZTR (12 December 2007). However, in that case C’s appeal was described by counsel for the respondent as being “a meritless and frivolous appeal”. The Appeals Tribunal said, at paras [42] and [43], that it was “inclined to agree, to some extent, with that submission and the award of costs must reflect that.” We also note that the Calderbank principle was applied. We do not believe the decision in C is a helpful precedent.

[37] There is nothing in the defendant’s conduct or personal circumstances which justifies our adopting a figure in excess of 50%. This Committee has previously observed in its decision of 11 March that oral submissions as to “no case”, which the defendant indicated would take only a few hours, extended over a 4 to 5 day period and many matters appeared to have been traversed in a most meticulous fashion. While the patience and forbearance of this Committee was sorely tested by the inaccurate assessment by the defendant of the time required to present her submissions, we do not impute any deliberate delaying of the hearing of this matter. We accept much of the delay was the consequence of the applications to the High Court for judicial review and the hearing of subsequent appeals. The defendant was fully entitled to take such action in support of her case.

[38] As we have previously observed, the informant has asked for an award at the 80% level. We are aware that the costs of the informant and the Judicial Control Authority are quite unprecedented in a racing-related case, but there has never been previously a hearing of this length, raising issues of such complexity. While we accept some issues raised by the defendant were “collateral issues”, to adopt the expression used by the informant, they were not matters that we would regard as being frivolous. Had we been of this view, we would have given serious consideration to an award approaching the level requested by the informant.

[39] In the circumstances of this case, we assess fair and reasonable costs to be the 50% figure that has been consistently adopted in the cases. Despite the lengthy period of time that it has taken for this matter to be determined, we do not find that there are exceptional circumstances that warrant an award in excess of this percentage. We also have regard to the fact that the defendant, although a very successful jockey in previous years, has had a very restricted income since suffering an injury in October 2008, and, we are told, no ACC payments since riding at Ellerslie over the Xmas/New year period. She will be unable to derive racing–related income during what is a lengthy period of disqualification.

[40] In determining an order for costs at this level to be appropriate, we have had regard to the defendant’s submission of June 2, that this Committee “functions for the benefit of all parties with a right of audience before it. It is proper that the Committee’s costs, if they are to be the subject of an award, be shared amongst the parties and not be saddled on one party only.” By adopting a figure of 50% we believe we are balancing the concerns expressed in the authorities that the figure should not derogate from the right of the defendant to defend the charges levelled against her, but her defence being unsuccessful, then it is a decision for which she must accept financial responsibility. With an order for 50% of costs, the racing industry is still required to bear a substantial burden.

[41] The defendant further submitted, and reiterated in her reply of 5 June, that this Committee should “follow the invariable practice in all previous cases of which counsel is aware, namely fix costs on a capped pro diem [per diem] basis.” The informant responded that he was not aware of such a cap, nor in principle ought there be one. This Committee is not aware of such a practice being adopted, let alone invariably being adopted, and we adopt a principled approach based on the authorities that we have identified in this decision.

[42] In a recent matter heard by a Judicial Committee, which also was of lengthy duration, McKenzie v B & Ors (New Plymouth, 21 April 2009), fair and reasonable costs were awarded without reference to any daily limit. In that case counsel for the informant also referred the Committee to case law where awards were in the order of 50%. The costs requested, based on that figure, were $41,000. The Committee in that case stated that while it “would normally agree that a sum close to or at this figure would be appropriate”, in the peculiar circumstances of that case (the award would impact upon the members of the Stratford Racing Club) the Committee tempered the award.

[43] We do not believe the award needs to be a precise 50/50 split down to the last dollars and cents. We reiterate costs are not being ordered on an indemnity basis. We believe an order for costs in the sum of $92,000 is fair and reasonable. This is only marginally less than the “benchmark” of 50%. These costs are to be divided on a proportional basis between the informant’s costs (legal fees and disbursements), and Judicial Control Authority costs.

[44] To summarise, the defendant is disqualified for 9 months and ordered to pay a fine of $7,500 and costs of $92,000.

[45] We understand the defendant has horses in training on the property where she currently resides. In order to allow her time to make the necessary arrangements for the re-stabling of these horses, we order that the commencement of the period of disqualification be deferred. The defendant is disqualified from 25 June 2009 up to and including 24 March 2010.

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