When Australian Turf Club directors front a Racing NSW show-cause hearing to argue why the host of Sydney racing shouldn’t be placed into administration, they face the considerable obstacle of history in their fight for ongoing independence.
The four remaining members of the ATC board - chair Tim Hale, deputy Caroline Searcy, Annette English and David McGrath - were last week granted a three-week extension to respond to the show-cause notice issued by Racing NSW on September 19.
In the days following the show-cause notice to the ATC, Racing NSW chair Dr Saranne Cooke expressed “significant doubts about the club’s ability to survive” due to concerns about solvency and accusations directors breached their code of conduct.
In a quite extraordinary “notice to participants”, Cooke outlined Racing NSW’s motivations for issuing the show cause, essentially front-running its case for the ATC to defend against.
The ATC is mounting what it believes is a strong case to ward off administrative intervention, but precedents suggest the club which runs Randwick, Rosehill, Warwick Farm and Canterbury could be in an uphill battle at the show-cause hearing on October 24.
Two NSW provincial and two country race clubs have previously fallen foul of the state’s thoroughbred regulator and asked to show-cause as to why they shouldn’t have an administrator put in place to run the clubs due to financial and/or governance concerns.
Wyong (2014), Hawkesbury (2021), Queanbeyan (2014) and Tamworth (2021) race clubs were all placed into administration by Racing NSW after being issued with show-cause notices over the past 12 years.
Hawkesbury Race Club, which is currently run by chief executive James Heddo, struck financial trouble owing to a legal dispute between it and a former staff member, court action which saw Racing NSW step in December 2021.
Hawkesbury remains under the control of administrator Jo Moore, who took over from David Jewell in 2023, although it is believed that could soon be coming to an end.
Bren O’Brien
In its most recent annual report, Hawkesbury reported an operating profit of $134,000.
“Since my appointment in August 2023, my focus has remained on embedding robust governance frameworks, resetting the club’s strategy, progressing on essential capital works and ensuring the Club’s financial sustainability. FY25 has delivered solid results across these areas,” Moore said in the report.
While three club directors resigned when Hawkesbury was placed into administration in 2021, a race club board has remained in place throughout its extended period of administration.
The three current elected directors on that board are Dean Halliwell, Chris Lawlor and Nicole Ryan. They were all appointed in July 2024. Heddo has been operating as Company Secretary since 2022.
That model, where a Racing NSW administrator oversees the board and the operations of a club, would appear to be one possible outcome of the ATC show cause hearing.
Warwick Barr
However, the Wyong Race Club board, which attempted to defend themselves and the club at a show-cause hearing, was suspended and later removed as were the directors of the Queanbeyan Race Club and the Tamworth Jockey Club.
All three of those clubs are now back under club management with boards in place.
In the lead-up to the show-cause notice, the ATC removed its long-serving executive Matt Galanos as its chief executive and installed Steve McMahon in an interim capacity.
McMahon is overseeing the club during its peak spring season in the lead-up to The Everest on October 18 and the Golden Eagle and Big Dance meetings, also at Randwick in early November.
A day before the issuing of the show-cause notice by Racing NSW, ATC member-elected director Ben Bayot resigned and independent director Natalie Hewson quit.
Hewson did not provide reasoning for her decision while Bayot told The Straight last month: "The actions of the board do not align with my personal values.
“The board lacks alignment, recently shown poor corporate governance and faces significant financial strain. I don't see a positive future for the club under this board."
Former ATC chair Peter McGauran, a staunch proponent of the plan to sell Rosehill for housing in a deal he claimed would future-proof racing in Sydney, resigned in July
The unsolicited sale process was the subject of a NSW Upper House Select Committee inquiry last year. Racing NSW chief executive Peter V’landys as well as ATC executive McMahon, a close friend of NSW Premier Chris Minns, were called before the inquiry and endured strong questioning, especially from Independent MP Mark Latham.
In May, after more than 18 months of debate and conjecture as well as a postponement on the vote at the behest of Racing NSW, ATC members voted against the motion to continue the process to sell Rosehill in a 56 per cent to 44 per cent split.
Bren O’Brien
Hale last week responded to Racing NSW’s agreement to postpone the show-cause hearing.
“It allows ATC further time to respond in more detail to Racing NSW’s notice, which we will do with diligence and integrity,” Hale said last week in an ATC statement.
“Importantly, our teams can focus on delivering a world-class racing carnival and raceday experience for our members and customers at the peak of spring.’’
The state Labor government reacted to the recommendations of the Select Committee inquiry by agreeing to conduct a review of the NSW Thoroughbred Racing Act.
The review is being overseen by former NSW health minister and Attorney General Brad Hazzard who has already called for public submissions in a discussion paper. Submissions close on Monday, November 24.
