Stirling Bloodstock Limited v New Zealand Thoroughbred Racing Incorporated
[2017] NZHC 464
•16 March 2017
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
CIV-2015-485-1057 [2017] NZHC 464
UNDER Part 30 of the High Court Rules and the
Judicature Amendment Act 1972
IN THE MATTER
of an application for judicial review
BETWEEN
STIRLING BLOODSTOCK LIMITED Applicant
AND
NEW ZEALAND THOROUGHBRED RACING INCORPORATED Respondent
Hearing: 23 May 2016 Counsel:
D R Bigio and A J Sinclair for Applicant
M G Colson and E A M Waston for RespondentJudgment:
16 March 2017
JUDGMENT OF CLARK J
Introduction
[1] In general terms people may call their horses by whatever names they please. But if a horse is to be raced in New Zealand it must be registered and its name approved by New Zealand Thoroughbred Racing Inc (NZTR).
[2] Stirling Bloodstock Ltd (Stirling Bloodstock) seeks orders quashing decisions of NZTR declining to register horses under the names ‘Lip Up Fatty’ and ‘Rotten Culture’.
NZTR’s rules relating to naming
[3] NZTR is an incorporated society responsible for overseeing the thoroughbred racing industry in New Zealand. Pursuant to s 29 of the Racing Act 2003, NZTR
STIRLING BLOODSTOCK LIMITED v NEW ZEALAND THOROUGHBRED RACING INCORPORATED [2017] NZHC 464 [16 March 2017]
must make and maintain rules for the conduct of racing. One of NZTR’s functions, and a matter in relation to which it has made rules, is to administer the registration and naming of thoroughbred horses.
[4] Rule 408 generally enables NZTR to approve or not an application for registration of a horse and provides relevantly:1
REGISTRATION OF HORSES
…
408(1) A horse shall only be registered if the application for registration of the horse is approved by NZTR.
…
(4) NZTR has complete discretion whether or not to approve an application for registration of and register a horse, and may approve registration of a horse on such terms and conditions as it sees fit in its absolute discretion …
[5] Rule 402 concerns names:
APPROVAL OF NAME OF HORSES
402(1) The Owner of a horse must propose the name under which the horse is to be registered at the time he or she applies for registration of the horse … and may only use that name for the horse once NZTR has approved that name for registration in accordance with sub-Rule (2) below.
(2) NZTR may approve a name for registration, or require a
change to a registered name …
[6] The parties were agreed that these rules confer on NZTR a discretion to approve or not a proposed name for a horse.
[7] NZTR is a signatory to the International Agreement on Breeding, Racing and Wagering (International Agreement). The International Agreement is administered by the International Federation of Horseracing Authorities the principal aim of which organisation is to identify and promote best practice in the administration of
horseracing worldwide.
1 Rules of Racing 2015, r 408.
[8] It was not in dispute that NZTR regarded art 14 of the International Agreement to be its operative guideline in considering approval of horse names at the time of the decisions under review. Article 14 prohibits the use of certain names, for instance if it has more than eighteen characters, or is the name of a public person, or is made up entirely of initials or punctuation marks. More relevantly, art 14 provides:
Article 14 (RACING/BREEDING) – REGISTRATION OF NAME
…
IV. Names cannot be accepted if they are already registered subject to the condition on re-use of names set out above, nor if:
…
3.– they are the name of a public person, without that person’s or their family’s permission, or names of commercial significance without the appropriate permission,
…
6.– they are suggestive or have a vulgar, obscene or insulting meaning; names considered in poor taste; or names that may be offensive to religious, political or ethnic groups,
[9] Since the decisions which are the subject of the present proceeding were made NZTR has developed and published its naming policy.2
NZTR’s decisions
[10] While the application for judicial review relates to two decisions in September 2015, earlier decisions of NZTR refusing to approve horse names proposed by Mr Dawson, Stirling Bloodstock’s racing manager, provide context to the decisions under review.
[11] On 16 September 2014 Mr Dawson, then on behalf of Whangateau Thoroughbreds Ltd, applied to register a horse under the name ‘Dotcom Go Home’. When advised by NZTR that ‘Dotcom Go Home’ would not be approved as it may be offensive to Mr Kim Dotcom, Mr Dawson’s wife proposed the name ‘Lip Up
Fatty’ as an alternative way of expressing the sentiment ‘Dotcom Go Home’.
2 New Zealand Thoroughbred Racing Inc NZTR Naming Policy (2016).
Ms Dalley, the registration officer who was processing the application, indicated that this name would probably be rejected also.
[12] Mr Dawson telephoned Ms Dalley and challenged the indication she had given to Mr Dawson’s wife of the likely outcome. Mr Dawson said this would not happen in Australia where he also raced horses.
[13] Ms Dalley emailed Racing Australia to seek its view:
Hi Glen,
Can you please tell me if you would call a horse LIP UP FATTY? We have said no. It is a song by a band called Bad Manners however we deem this as inappropriate.
Your help on this would be much appreciated.
[14] An employee of Racing Australia replied that his “gut feeling” was “no”. Ms Dalley responded that NZTR was “not budging” on the refusal to approve ‘Lip Up Fatty’ “especially after [Mr Dawson’s] first choice of name [‘Dotcom Go Home’].”
[15] A written application made by Mr Dawson to register the name ‘Lip Up
Fatty’ was not approved. The horse in question was instead registered on
26 September 2014 as ‘It Aint Over’, Mr Dawson’s subsequent proposal.
[16] Mr Dawson, again on behalf of Whangateau Thoroughbreds Ltd, made
another application to register a horse under the name ‘Lip Up Fatty’ on 19 May
2015. Again NZTR declined to approve the name, saying that the name was not
acceptable. This horse ended up with the name ‘Buster Bloodvessel’.
[17] Following this second refusal NZTR was contacted by counsel for the applicant, Mr Bigio, with a request for its naming guidelines.
[18] The Chief Executive Officer of NZTR, Mr Purcell, replied setting out art
14(6) of the International Agreement and the text of r 408(4), both of which I have quoted at [8] and [4] above. Mr Purcell also elaborated upon the decisions to decline approval of ‘Dotcom Go Home’ and ‘Lip Up Fatty’:
Looking at our records the three name applications submitted by your client that have been declined by NZTR are:
…
·Dotcom Go Home — this was deemed inappropriate by our registrations staff as it maybe offensive to some people, including Mr Kim Dotcom.
·Lip Up Fatty — this was deemed inappropriate by our registrations staff because, despite being the name of a band, maybe offensive to some people.3
[19] I turn now to the decisions which are the subject of the application for judicial review.
[20] On 17 September 2015 Mr Dawson applied once more, this time on behalf of Stirling Bloodstock, to register a horse under the name ‘Lip Up Fatty’. The horse in question was Australian-born and, pursuant to art 14(I) of the International Agreement, concurrence of Racing Australia was required before the name could be approved:
IThe registration of a name for a horse can only be made by or with approval of the competent Authority of its country of birth.
…
[21] Accordingly, and on the same day, NZTR forwarded the correspondence set out above at [12]–[14] to Racing Australia, asking whether Racing Australia remained of the view that ‘Lip Up Fatty’ should not be registered. Racing Australia replied later that day affirming its view that it would not approve the name.
[22] On 23 September 2015 NZTR advised it had refused to approve the name:
Dear Malika
Mr Dawson has previously been advised that the name LIP UP FATTY is not acceptable.
Further, the 2013 filly by BENETEAU (AUS) ex LA LUNE is Australian- bred so any name submitted for her has to be approved by Racing Australia.
Please submit a further selection of names for this filly […]
3 ‘Lip Up Fatty’ is in fact the name of a song by a band, Bad Manners.
[23] Later that day Mr Dawson, on behalf of Stirling Bloodstock, applied to register the same horse under the name ‘Rotten Culture’. Ms Dalley deposed that because the phrase was associated with dysfunctional organisations she saw it as a “dig” at NZTR. She emailed Racing Australia:
We have been asked to check the name ROTTEN CULTURE for the 2013 filly by BENETAU x LA LUNE. Unfortunately this is for the disgruntled owner who was advised his previous name LIP UP FATTY (referring to a derogatory situation) was unavailable. When put into a google search this comes up as the following:
What It takes To Change a Rotten Organizational Culture… Bigthink.com/…/what-it-takes-to-change-a-rotten-organisational- culture
How do corporations that have perpetuated dysfunctional, despicable and illegal cultures turn those around. Is it even possible?
NZTR have deemed this inappropriate under the circumstances. Can you please advise whether this would be available in Australia as this is an Australian bred horse.
[24] Before Racing Australia responded NZTR contacted the applicant to advise that ‘Rotten Culture’ was “unacceptable” and the name would not be approved. After a further exchange of emails the horse was eventually registered with the name
‘Dontpokethetiger’.
The application for judicial review
[25] The decisions are challenged on several and related grounds of review. The case advanced for the applicant in written submissions differed in material ways from its pleaded case. Unpleaded grounds were argued and some pleaded grounds were not.
[26] Because the respondent claimed no prejudice from this departure from the pleadings, and responded to the applicant’s case as it was put in submissions, I propose to determine the application by reference to the case as it was submitted rather than as it was pleaded.
[27] In relation to the September 2015 ‘Lip Up Fatty’ decision, the applicant says:
(a) NZTR erred in law by misinterpreting its naming policy which,
properly interpreted, does not prohibit the name ‘Lip Up Fatty’. (b) NZTR took into account irrelevant considerations being:
(i)the opinion of Racing Australia on whether the name should be approved; and
(ii) the fact that Mr Dawson initially sought the name ‘Dotcom Go
Home’.
(c) NZTR exercised its discretion inconsistently because it had previously
registered names which included the word ‘fat’.
[28] In relation to the ‘Rotten Culture’ decision, the applicant says:
(a) NZTR erred in law by misinterpreting its naming policy which, properly interpreted, does not prohibit the name ‘Rotten Culture’.
(b) NZTR took into account an irrelevant consideration being the result of
a Google search of the phrase “rotten culture”.
(c) NZTR erred in law by failing to await Racing Australia’s response as to whether it approved the name ‘Rotten Culture’ before declining the applicant’s application for that name.
[29] On those bases the applicant seeks a declaration that the challenged decisions were illegal and invalid and an order that they be quashed.
[30] NZTR does not dispute that these decisions are susceptible to judicial review.
Error of law?
[31] The primary controversy in this case concerns the effect of art 14 of the
International Agreement on NZTR’s power to decide whether to register or not
register a horse under a particular name. As I have said, it is not disputed that the decision to register is discretionary.
[32] The applicant’s position is that:
(a) NZTR erred in law by misinterpreting its naming policy. NZTR adopted art 14 as its naming policy. NZTR refused to approve ‘Lip Up Fatty’ because it may be offensive to some people. But, the applicant contends, “only names that are offensive to religious, political or ethnic groups constitute names that are offensive” according to the terms of art 14. NZTR thus erred in refusing to approve ‘Lip Up Fatty’ on the basis that it was offensive because it could not constitute an offensive name under the naming policy.
(b)Neither ‘Lip Up Fatty’ nor ‘Rotten Culture’ have a vulgar, obscene or insulting meaning, are in poor taste, or are offensive to religious, political or ethnic groups.
(c) NZTR erred in declining the name ‘Rotten Culture’ before receiving
approval from Australia.
[33] First, it is useful to return briefly to the reasons NZTR gave for its decisions. (a) In relation to the ‘Lip Up Fatty’ decision, NZTR wrote to the
applicant on 23 December saying Mr Dawson had already been
advised the name was “not acceptable”.
(b) In the earlier communication so advising Mr Dawson, Mr Purcell had
explained ‘Lip Up Fatty’ may be “offensive to some people”.
(c) In advising the applicant of the ‘Rotten Culture’ decision, NZTR said that the name was “unacceptable”.
Error in applying naming policy?
[34] The question whether NZTR erred in law is to be approached by considering the scope of art 14 and the extent to which art 14 constrains NZTR’s discretion in processing applications for registration.
[35] Article 14 prohibits from approval many categories of names. Relevant to this proceeding is the prohibited category in art 14(IV)(6) which I set out once more:
IV. Names cannot be accepted if …
6. – they are suggestive or have a vulgar, obscene or insulting meaning; names considered in poor taste; or names that may be offensive to religious, political or ethnic groups.
[36] Crucially, art 14 leaves a large measure of discretion to individual authorities. It will be for them to assess in their local contexts what they consider to be “insulting” or in “poor taste”. The process of approving names that do not attract outright prohibition will reflect different considerations, tolerances and thresholds in each jurisdiction. The assessment of whether a name is insulting or in poor taste will be in the eye of the relevant jurisdictional authority which, in New Zealand, is the NZTR. What may be considered vulgar or in poor taste in Mexico, for example, may be inconsequential or innocuous in another jurisdiction. By contrast, there will be less scope for debate when determining whether a name may be offensive to religious, political or ethnic groups. Largely that ground of disqualification will be objectively assessed.
[37] Article 14 is best understood as establishing a minimum standard while leaving considerable scope in the areas beyond. In New Zealand the discretion which NZTR exercises in regulating the registration and naming of horses is reflected in rr 408 and 402 which must be read together. Without NZTR’s approval of a name for registration the application for registration, in respect of which NZTR “has complete discretion”, will not be approved.
[38] To regard art 14 as exhaustive of the NZTR’s discretion would produce anomalous results. As Mr Colson submitted, it would prevent NZTR from refusing to register names that were, for example, pejoratives relating to gender or sexuality,
because art 14 does not identify gender or sexuality as categories in relation to which a name might be considered offensive.
[39] Under the policy which NZTR has now developed a name will not be approved if it “appears to be designed to harass, humiliate or disparage a specific individual, group of individuals or entity.”4 The fact that NZTR had no such policy in place at the time it made the decisions now challenged does not, of itself, mean its decisions were in error of law. The exercise of the discretion available to it was (and remains) to be guided by the purposes underlying legislation that grants NZTR the authority to make and enforce its rules, one of which purposes is to promote the long-term viability of New Zealand racing.5
[40] I therefore conclude that art 14 is not exhaustive of NZTR’s discretion to approve names or not. The applicant has not established that NZTR misconstrued or misapplied art 14. I find no error of law in NZTR’s refusal to approve the names
‘Lip Up Fatty’ and ‘Rotten Culture’. The refusal to approve the names was within the discretion exercisable by NZTR and NZTR was not in error in determining that
‘Lip Up Fatty’, and ‘Rotten Culture’ were unacceptable against NZTR’s standards.
Error in refusing ‘Rotten Culture’ before receiving approval from Australia?
[41] Also under the head of error of law the applicant contended that NZTR erred by refusing to approve ‘Rotten Culture’ prior to hearing Racing Australia’s response as to whether it approved the name ‘Rotten Culture’.
[42] Ms Walker, Keeper of the Stud Book, deposed for NZTR that art 14 of the International Agreement required concurrence of Racing Australia as to the proposed name because the horse was Australian-born. The force and source of this obligation is not disputed by the applicant, though it disputes NZTR’s approach.
[43] I reach the view that NZTR did not err in law in not waiting for Racing
Australia to approve the name. Article 14(I), (set out at [20] above), requires concurrence of the two authorities for a registration to occur, not consensus as to the
4 New Zealand Thoroughbred Racing Inc NZTR Naming Policy (2016) at 2.
5 Racing Act 2003, s 3.
outcome. Only if NZTR intended to approve the name would it need to await Racing Australia’s response before approving the registration. Because NZTR refused to approve the name it was not necessary to await Racing Australia’s response. Its response could not change the outcome.
Inconsistent exercise of discretion?
[44] NZTR has previously approved the names that include the word ‘fat’:
(a) ‘Fats’;
(b) ‘Fatboy Slim’; (c) ‘Fat Kid’;
(d) ‘Fatimite’;
(e) ‘Fat Knight’; and
(f) ‘Fat Albert’.
[45] Mr Bigio submitted that decision-makers are under an obligation to treat like cases alike.6 The applicant maintains that ‘Lip Up Fatty’ is very similar to those names previously approved. NZTR has therefore failed to treat like cases alike. Moreover, the applicant points to the affidavit evidence of Ms Walker to the effect that ‘Fats’ and ‘Fatboy Slim’ were registered because those names were understood to refer to musicians. It was therefore inconsistent to refuse approval of ‘Lip Up Fatty’ which, the applicant says, is a reference to a song by a band and is no more offensive than the other names incorporating a musical reference and using the word
‘fat’.
[46] The respondent’s position is that there is a sufficient difference between ‘Lip
Up Fatty’ and the historically-approved names employing the word ‘fat’ to justify a
different outcome.
6 Citing Ding v Minister of Immigration (2006) 25 FRNZ 568 (HC) at [36]; Minister of Immigration v Vileceanu HC Wellington CIV-2007-485-377, 11 December 2007 at [36]; PP and G Basra Ltd v Rangitoto College Board of Trustees [2010] NZAR 372 (HC) at [49].
[47] The applicant seeks to establish its case by seizing on a single word (‘fat’) which appears in registered names and reasons that, therefore, the proposed name cannot be properly refused because there is sufficient similarity between them. With respect to the applicant that approach fails to understand the nature of the exercise in which art 14 requires NZTR to engage and also the very broad discretion which accompanies that function. Besides, NZTR did not refuse to register ‘fat’. It declined to register ‘Lip Up Fatty’.
[48] I do not accept that NZTR’s decisions were inconsistent. The converse of the principle that like cases must be treated alike is that dissimilar cases may be treated dissimilarly in proportion to their difference. I accept Mr Colson’s submission that none of the names relied on used the expression ‘fatty’ which may be sufficiently different in tone to justify a different outcome. That was and remains a judgement that is for NZTR to make, not the Court. The applicant has not established this ground of review.
Irrelevant considerations?
[49] The applicant contends that the decisions were tainted by irrelevant considerations.
(a) In relation to ‘Lip Up Fatty’, the fact of Mr Dawson’s earlier attempt to register the name ‘Dotcom Go Home’ was not relevant and nor was the opinion of Racing Australia.
(b) In relation to ‘Rotten Culture’, the result of a Google search of the
expression was not relevant.
[50] The respondent’s position is that these considerations are permissible. Alternatively, to the extent they are irrelevant, Mr Colson submitted that consideration of irrelevant factors is only unlawful if, but for such consideration, the decision-maker would have reached a different outcome.
[51] Mandatory relevant considerations are expressed or implied by the statute under which a decision is made.7 Similarly, irrelevancies may be inferred from statute. In between there may be a range of factors that are not required to be considered but which nonetheless are permissible matters for a decision-maker to take into account.
[52] In determining whether the impugned considerations are permissible it is helpful to have regard to the context in which decisions whether to approve horse names are made. Mr Campbell Moncur, the Deputy Chief Executive Officer of NZTR, deposed to the nature and function of the respondent and its approach to exercising its various powers. NZTR’s functions include:
(a) encouraging participation in thoroughbred racing.
(b) improving the economic welfare of thoroughbred racing.
(c) liaising with other international thoroughbred racing jurisdictions to ensure a consistency of approach on certain issues.
(d) providing an administrative function for thoroughbred racing.
[53] NZTR is a modestly sized organisation relative to the breadth of its functions and responsibilities. It has 37 employees and an operating budget of approximately
$7.3 million. It receives and processes roughly 2,200 applications for registration each year. Applicants may put forward a number of alternative names and some are in the habit of consulting with NZTR on proposed names prior to filing an application.
[54] Mr Moncur’s evidence was that one of the broad principles guiding NZTR’s approach to applications to register names is that NZTR will not register a name that is offensive, insulting or obscene.
[55] Assessing these impacts requires, according to Mr Moncur, a balancing of competing interests. Owners enjoy choosing the names of their horses. That is
recognised as an important part of racing for owners. NZTR recognises that people take pride or pleasure in choosing a name that may relate to the horse’s breeding, personal events or is simply humorous. On the other hand racing is an entertainment industry and is required to maintain a positive image. NZTR therefore attempts to avoid names which could be viewed as “negative or objectionable”. To that end NZTR regards as a good test what a family, if it was enjoying a day at the races, may think of a potentially objectionable name.
[56] Having regard to the context in which NZTR operates none of the considerations to which the applicant points are, in my view, irrelevant considerations.
(a) Mr Dawson’s earlier attempt to register the name ‘Dotcom Go Home’ was, in the context of this case, a permissible consideration when deciding whether to approve ‘Lip Up Fatty’. Mr Dawson’s wife informed NZTR that ‘Lip Up Fatty’ was intended as another way of expressing the sentiment ‘Dotcom Go Home’. That the applicant
sought to evade the prohibition on names referring to public persons8
by referring to Mr Dotcom indirectly by way of the name ‘Lip Up Fatty’ is a relevant consideration when determining whether to approve that name.
(b)The opinion of Racing Australia was not an irrelevant consideration when determining whether to approve ‘Lip Up Fatty’. Indeed it was nothing short of conscientious on the part of Ms Dalley to inquire with Racing Australia given Mr Dawson’s assertion that his proposed names would not have met resistance in Australia. Consistency of decision-making with Racing Australia is desirable given that horses may be moved between jurisdictions, as was the case with one of the horses in the present case. Racing Australia’s opinion may therefore be relevant.
(c) Ascertainment of the meaning of ‘Rotten Culture’ was not an irrelevant consideration when determining whether to approve ‘Rotten Culture’. Ms Walker deposed that as a matter of practice NZTR uses Google searches and refers to urbandictionary.com to check that proposed names do not have a meaning unknown to NZTR that might constitute a reason to refuse to approve the name. Consulting reference sources, popular or technical, to determine what proposed names may connote to thoroughbred racing participants, including especially spectators, is a logical approach to discharging NZTR’s responsibilities to administer registration and naming in a way that best promotes thoroughbred racing as an entertainment industry.
[57] Accordingly neither decision is tainted by any irrelevant consideration.
Result
[58] The application for judicial review is dismissed.
[59] The respondent is entitled to costs.
Karen Clark J
Solicitors:
Pidgeon Law, Auckland for Applicant
Bell Gully, Wellington for Respondent
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