ATC wins court reprieve from administration until at least February
The Australian Turf Club will stay out of Racing NSW-imposed administration until at least February, after the Supreme Court of NSW issued a new order preventing any further action until the matter can go to a further hearing.
Directors of the Australian Turf Club will remain in charge of the club for the next nine weeks before returning to court in the New Year when they will argue that Racing NSW does not have the authority to put the organisation into administration.
The two-day preliminary hearing before Justice Francois Kunc in the NSW Supreme Court concluded on Friday, the last day of the judicial year, where he ordered an injunction remain in place until the matter can be heard in full in February.
The judgment was preceded by Racing NSW determining on Monday that the ATC, which runs Sydney’s four thoroughbred racecourses, should be placed into administration after a three-month show-cause period.
Racing NSW had appointed Morgan Kelly of Ernst and Young as the administrator after its board claimed the ATC directors had ceased to be effective as a governing body while holding grave solvency concerns.
ATC directors Tim Hale, Caroline Searcy, David McGrath and Annette English’s legal team, led by Scott Robertson SC, were successful in seeking the injunction after two days of legal argument with a ruling that the ATC board retains its control of the club until further order.
They will return to court on February 19 and 20 with a directions hearing on February 6.
Racing NSW counsel Oliver Jones SC had argued that there was a serious risk of insolvency if the administrator wasn’t allowed to fulfil his duties.
But Justice Kunc said it was clear from evidence provided the risk of the club becoming insolvent before the end of February 2026 was negligible and that the club had $29 million in the bank.
“There is no evidence there is any real prospect (or any prospect at all), that there will be calls on those funds other than in the ordinary course of business in the next nine weeks,” he said.
Justice Kunc also said that the evidence is clear that the directors have been taking steps to address the concerns raised by Racing NSW.
He concluded that “there is a real public interest in allowing the club to continue to be operated by those who have been democratically put in place to do so”.
“I accept that Racing NSW has concluded those steps are variously inadequate, ineffectual and perhaps even incompetent. Whether that assessment is correct is not a matter for the court,” he said
Further on in his judgment, Justice Kunc said: “There is no evidence that what the directors are doing will have deleterious effects on the club and in the next nine weeks or that Mr Kelly’s appointment will bring substantial immediate benefit to the club in that period.”
Justice Kunc also denied an application for the administrator to start work examining the ATC’s financials prior to February’s hearing as had been called for by Oliver Jones SC after the injunction was formalised.
If an administrator was appointed immediately, Racing NSW’s legal counsel had argued earlier on Friday that it would “bring about $1 million in savings over the next six weeks”.
Justice Kunc also ruled that there was nothing stopping the ATC board appointing a member-elected director as a replacement for Ben Bayot, who quit in September, just a day before Racing NSW issued the club with a show-cause notice.
During the show-cause process, Racing NSW had prevented the ATC from filling the member-elected vacancy on the board, an issue raised by the directors in an update to its members on Monday after they had received immediate Interlocutory relief.
Racing NSW had sought to place the ATC under administration under section 14 of the Thoroughbred Racing Act, legislation which is under a state government ordered review by former NSW health minister Brad Hazzard.
Justice Kunc also ruled that the ATC directors would not be personally liable for costs associated with the case.
Hale, ATC’s chair, acknowledged the court’s decision.
“The board of the Australian Turf Club welcomes today’s decision and will now continue to work diligently and collaboratively with all stakeholders to continue normal racing and club operations,” Hale said in a statement.
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