RNSW asked the ATC in September to show reasons why the regulator should not appoint an administrator to run the club, citing concerns about its financial situation. RNSW gave the ATC two weeks to submit a formal response, which was later extended by three weeks to October 24.
ATC chairman Tim Hale SC said at the time that the ATC would cooperate with that process, saying it would promote long-term viability, while also adding: “I would like to emphasize that the ATC remains rich, resilient and strong.”
However, on Monday morning, RNSW issued a press release announcing the appointment of “an administrator” to manage the club’s affairs.
The regulator said this was the result of an ‘extensive’ and ‘exhaustive’ show-cause process undertaken ‘to ensure that the ATC was given every reasonable and indeed ample opportunity to address the serious concerns’.
“Throughout the Show Cause process, the ATC Board was repeatedly invited to make detailed submissions, present the proposed strategy to improve the Club’s financial performance and its future solvency and respond comprehensively to corporate governance concerns,” the press release said.
“In particular, the ATC board was unable to demonstrate that it could develop and implement a strategy to improve the club’s commercial performance, or to rectify its serious financial problems. In addition, concerns about corporate governance had not been appropriately addressed.”
RNSW said it has “appointed a professional director who will report to a committee to be established. This committee will consist of appropriate expertise and may include a mix appointed from current ATC board members, ATC members using a best practice skills matrix and other appropriate individuals.”
The manager was not named in the RNSW press release. The Sydney Morning Herald later named the administrator as Morgan Kelly of Ernst and Young.
RNSW said the committee and administrator would replace the functions of the ATC board, while day-to-day operations would continue to be managed by the ATC executive team and “there will be no impact on the running of race meetings or events at ATC venues.”
“This term of governance will provide the ATC with the opportunity to improve its financial performance, address its serious financial challenges and develop a robust and best practice long-term strategy for the club, utilizing the best possible skills and expertise,” the press release said.
Hours later, the ATC board responded by saying it believed RNSW did not have the authority to take the announced step.
“The ATC board does not accept that Racing NSW has the legal power to remove or remove the duly appointed directors of the club, or to appoint an administrator in their place,” the board said in a statement.
“The Board of Directors remains in office and continues to regard itself as the legitimate governing body of the ATC under the ATC Constitution, the (Commonwealth) Corporations Act 2001 and the Australian Jockey and Sydney Turf Clubs Merger Act 2010 (NSW).”
That statement was quickly followed by ATC directors filing an emergency injunction in the High Court late on Monday, a club spokesperson told ANZ.
The Sydney Morning Herald reported that Scott Robertson SC, appearing on behalf of the ATC’s four board members, told the court that the appointment of an administrator by the regulator was made for an “improper purpose” and was “invalid”.
Oliver Jones SC, representing the RNSW, responded by saying the controlling body had the legal authority to take such action and that it had “serious concerns about the ability of the Australian Turf Club to manage itself”, the Herald reported.
The newspaper added that the case would be heard on December 16, after RNSW agreed not to take any further action until then.
#ATC #requests #injunction #appointment #administrator