Supreme Court

Andrew Madden
										(Plaintiff)

v.

Irish Turf Club, the Irish National Hunt Steeplechase Committee,  Cahir O’Sullivan and John Harvey
										(Defendants)

No. 140 of 1993
[17th of February, 1997]

Status: Reported at [1997] 2 ILRM 148

O’Flaherty J. (Blayney and Murphy JJ concurring) 
This is an appeal brought by the defendants from the judgment and order of the High Court (Morris J) of 2 April 1993, awarding the plaintiff £18,930.80 damages as a result of the defendants’ alleged negligence.

Background
The plaintiff is a solicitor by profession. He is also a keen racegoer. On 12 January 1989, he went to a race meeting at Punchestown. The races that day were over jumps, with the exception of the sixth and last race on the card which was a race run on the flat under national hunt rules. All the races that day were under the rules as contained in a book entitled ‘Rules of Racing and Irish National Hunt Steeple Chase Rules’. The edition which was relevant to this case is dated 1989, and reference to ‘rules’ in this judgment are to the rules as contained in that edition. The first and second named defendants are respectively concerned with the management of flat and national hunt racing in this country. The remaining defendants are officers of the defendants.

The races and the tote
The Racing Board controls the tote. The tote management provided for a jackpot on the occasion in question. A jackpot bet is a pool bet on four races. The punter decides which horses to bet on and then buys a ticket to cover the horses, a selection is made in four races and, seemingly, these are always the third, fourth, fifth and sixth races on the card. The plaintiff entered for the jackpot and duly selected the winning horse in the third, fourth and fifth races and for the sixth race he selected a horse named Lucky Bucket. The race was won by Dell of Gold. Lucky Bucket came second.
The plaintiff testified at trial that he was a serious follower of form. He knew that Dell of Gold had run in jump races and had not shown a lot of form. He did not know that the horse had run in England, at Wolverhampton and Ripon. So, he was not disposed to nominate this horse as a potential winner of the race in question.

Winner not qualified
Dell of Gold was not qualified to run in the race. This is because of rule 79(v) of the rules which provides:-

No horse shall be qualified to start for an Irish National Hunt flat race which has run in a flat race as a two year old or three year old or in a hurdle race at three years old.

Dell of Gold had run on the flat as a two year old in England and that had disqualified it under rule 79(v) of the rules.
The defendants found out that the horse had not been qualified to race and so it was disqualified on 27 January 1993, and Lucky Bucket was declared the winner. It appears that Lucky Bucket had beaten the third horse home by five lengths.
The totalisator betting conditions provided at paragraph 37(2) as follows:-

The result of any race shall be deemed to be the result as determined under the rules governing racing at the ‘All right’ and no subsequent event shall have any effect whatsoever and when the manager has ordered the winnings or refunds to be paid, no backer of any other horse in that race, or of any combination containing any other horse in that race, shall be entitled to receive winnings or refunds on that race notwithstanding that by a decision of the stewards or the racing authority or otherwise the race is declared void or any horse shall be declared to be the winner or to have been placed in that particular race instead of the horses declared at the “All right” to be the winner or to have been placed or whatever may afterwards result, any rule of law or rule of racing of any nature or kind to the contrary notwithstanding.

The term ‘All right’ is defined in the conditions to mean the time at which the stewards authorise the appropriate signal to be given indicating that the riders in a race have weighed-in to the satisfaction of the clerk of the scales in accordance with the rules governing the race, irrespective of whether the signal is in fact given.
So, as far as the tote management was concerned, the winner of the race was and would always be deemed to be Dell of Gold, notwithstanding subsequent events.

Defendants’ function and obligation
It is part of the defendants’ function and obligation to make sure that horses that are not qualified do not enter races for which they are not qualified. While there seems to have been an extensive debate at the court of trial as to whether it would be expecting too much of the defendants to have picked up the fact that this horse was not qualified that submission, having been rejected by the trial judge, was not pursued before us to any degree. It appears that only about 150 horses (not 190 as stated in the High Court judgment) come from England each year. On the other hand, there is no doubt that since racing is such a worldwide sport and business nowadays, and horses are shipped from one end of the globe to the other, an argument based on hardship of performance might be sustainable if we were concerned with a horse brought from far away, but it is sufficient to say that issue was not raised for resolution as far as this case is concerned.

Is there a duty of care?
	Instead, Mr. Feeney SC, for the defendants takes a more pre-emptive position: which is to submit that in the circumstances of this case there was no duty of care owed by the defendants to the plaintiff. He rests this on two bases. He submits, in the first instance, that the frame, so to speak, in which the plaintiff was operating was that he had a contractual relationship with the tote management. The plaintiff knew the number of horses that were in the particular race; he had a choice as to which horses he would nominate; he knew the rule that once the ‘All right’ was given then that was to be the result for all time as between the tote management and himself – no matter what was uncovered afterwards. Further, he submits that there was not such a relationship of neighbourliness between the parties as to give rise to a duty of care. In this regard he referred us to two decisions of this Court, Ward v. McMaster  [1988] IR 337;  [1989] ILRM 400 and Sunderland v. Louth County Council  [1990] ILRM 658 as well as to the High Court decision of Blayney J in McMahon v. Ireland  [1988] ILRM 610. He submits that the correct test is to be found in these cases rather than in the two cases on which the learned trial judge relied: McNamara v. ESB  I[1975] R 1 and Purtill v. Athlone Urban District Council  [1975] IR 205. The latter cases dealt with the duty of care that may be owed by an occupier to persons coming (even as trespassers) on his premises. The three cases on which Mr. Feeney relies establish, so he submits, that it is essential in the case of a claim for economic loss – whatever about claims for personal injuries or physical damage – that a duty of care must be established through the relationship of the parties.

Analysis of the cases cited
In the Ward case the local authority advanced a loan to an indigent couple in respect of a dwelling-house which turned out to be totally uninhabitable. The council took the view that a valuer’s report would suffice to show that the house provided sufficient security for the amount advanced. And so it appeared to the valuer. The council did not think it necessary to go further and have the house professionally surveyed.
This lack of care would not have given the plaintiff a right of action in the absence of the special relationship that arose between the parties because under the Housing Act 1966, the council had obligations to provide housing for those otherwise unable to fund the purchase of a house. As Henchy J said (at p. 342):-

It is necessary for [the plaintiff] to show that the relationship between him and the council was one of proximity or neighbourhood which cast a duty on the council to ensure that, regardless of anything left undone by the plaintiff, he would not end up as the mortgagor of a house which was not a good security for the amount of the loan. A paternalist or protective duty of that kind would not normally be imposed on a mortgagee in favour of a mortgagor, but the plaintiff was in a special position.

McCarthy J (at p. 349), in taking a somewhat different stance to the trial judge, said that he would:-

…prefer to express the duty as arising from the proximity of the parties, the foreseeabiity of the damage, and the absence of any compelling exemption based upon public policy. I do not, in any fashion, seek to exclude the latter consideration, although I confess that such a consideration must be a very powerful one if it is to be used to deny an injured party his right to redress at the expense of the person or body that injured him.

Sunderland’s case decided that a planning authority in the exercise of its power under the Local Government (Planning and Development) Act 1963, owes no duty of care at common law towards the occupiers of buildings erected in its functional area to avoid damage due to defective siting and construction.
McCarthy J, speaking for the court (at p. 663) pointed out the fundamental difference between planning legislation and housing legislation when he said:-

…the first is regulatory or licensing according to the requirements of the proper planning and development of the area but the second is a provision in a social context for those who are unable to provide for themselves; if they are unable to provide for themselves then the duty on the provider reaches the role that would be taken by professional advisers engaged on behalf of the beneficiary. This is in marked contrast to the watchdog role that is created under the Planning Act, a watchdog role that is for the benefit of the public at large.

He also went on to refer to the role of An Bord Pleanála and thought that if a duty lay upon the board it would be a very wide one and it could not have been the intention of the legislature to make the board liable on what would be a vast scale.
See, too, the judgment of Keane J in Convery v. Dublin County Council Supreme Court 1995 No. 401, 12 November 1996.
In the McMahon case, Blayney J was concerned with whether there was a sufficient relationship of proximity between the Registrar of Friendly Societies (having regard to his statutory duties and obligations) and the plaintiff, as a depositor with a provident society who had lost money, as to place the registrar under a duty of care towards her. He said (at p. 613):-

It seems to me that the first issue that has to be considered is whether the registrar owed any duty of care to the plaintiff as, in the absence of such a duty, he could not have any liability in negligence. And this involves considering whether there was a sufficient relationship of proximity or neighbourhood between the registrar and prospective depositors as to place the registrar under a duty of care towards persons who came within that class, as did the plaintiff. It is clear that there was nothing the registrar could have done to save the plaintiff from loss after she had deposited the money. So the inquiry is limited to the question of whether the registrar owed her a duty when she was still a prospective or would-be depositor.

Having considered the decision of the Privy Council in Yuen Kun Yeu v. Attorney General of Hong Kong  [1988] AC 175, he followed the reasoning contained in the opinion of the Privy Council in that case and held that there was not such close and direct relations between the registrar - his essential function being supervisory and regulatory – and the plaintiff as to give rise to any duty of care on the part of the registrar towards the plaintiff.

The plaintiff’s stance
Mr. McCann SC, for the plaintiff agrees that, of course, there are cases where the parties are sufficiently remote from each other that a duty of care does not arise. However, he says that the activity of betting on horse racing is so integral a part of the racing scene that the parties are in sufficient proximity and that the defendants must be held to owe a duty of care to his client. The punter depends on those holding horse races to take reasonable care that only qualified horses are allowed to compete.

Policy considerations
There is no doubt that if this proposition were accepted, it would have very wide consequences. It would mean that if through any one of a myriad of circumstances a horse that should have won did not win, and it could be shown that this was due to carelessness on the part of the defendants, then there would be, to adopt the dictum of Cardozo CJ ‘liability in an indeterminate amount for an indeterminate time to an indeterminate class’: Ultramares Corporation v. Touche (1931) 255 NY 170 at p. 179. That, in turn, brings into play public policy considerations. While Mr. Feeney (who did not appear in the High Court) has drawn attention to the wide ramifications attendant on imposing liability in circumstances such as the present case in regard to horse races as well as sporting events in general, it must be said that the public policy argument was not advanced in the High Court.

Conclusion
I have come to the conclusion that no duty of care was owed by the defendants to the plaintiff in the circumstances of this case. The betting aspect of race meetings is separate from the defendants’ essential function which is to regulate and control horse races at various courses throughout the country. No doubt, from time to time, the defendants will incur obligations to owners, trainers and jockeys; just as these persons have duties and obligations towards the defendants. The rules expressly provide that the stewards are to take no cognisance of any disputes or claims with respect to bets (rules 19 and 23). Further, the plaintiffs contractual relationship was with the tote management and that erected a barrier so as to prevent such close and direct relations to occur as is necessary to give rise to a duty of care between the plaintiff and the defendants.
In this regard it is apposite to recall that Lord Atkin in his formulation of the duty of care in Donoghue v. Stevenson  [1932] AC 562 put it thus (at p. 580):-

You must take reasonable care to avoid acts or omissions which you can reasonably foresee would be liable to injure your neighbour. Who, then, in law, is my neighbour? The answer seems to be – persons who are so closely and directly affected by my act that I ought reasonably to have them in contemplation as being so affected when I am directing my mind to the acts or omissions which are called in question. (emphasis added)

It is clear from the rules, already referred to, that the defendants did not contemplate having any liability in respect of betting mishaps and, instead, expressly provided in the rules that they were to have nothing to do with them. I appreciate the point that this is not, of course, a case about a betting dispute but, nonetheless, the rules are relevant in indicating that the betting aspect of race meetings must be kept in a separate compartment.
In this case, it is clear that the defendants’ chief function is to administer horse racing in as orderly a fashion as possible and carry out their system of checks and balances in relation to owners, trainers and jockeys as well as horses in accordance with their rules. This case provides a good example of how they discharged their obligation to the owners etc. of Lucky Bucket. The horse was awarded the first place and the owner and trainer, no doubt, were given the relevant prize money and whatever else was due to the winner. The matter of how gambling, whether on the tote or otherwise, is conducted belongs to a different regime for which they have no responsibility.
As regards the public policy argument, since it was not debated in the court below and since it is not necessary for any decision in this case, I leave over consideration of that point to a case where it will be necessary for resolution of the matter in debate.
In the circumstances, I would allow the appeal.