Not just pies and beer – Court rules Racing NSW cannot appoint an administrator to ATC

The Supreme Court of New South Wales has set aside Racing NSW's appointment of an administrator to the Australian Turf Club (ATC) in Australian Turf Club Ltd v Racing NSW (No 2) [2026] NSWSC 184.

In September 2025 Racing NSW issued a show cause notice to ATC raising concerns about the club's financial position, governance and strategic direction. Following that process, Racing NSW resolved in December 2025 to appoint an external administrator to the ATC.

ATC challenged the appointment in the Supreme Court.

The decision

Justice Kunc held that the appointment was invalid and of no effect.

The judgment emphasised that the case was not about whether Racing NSW's concerns about ATC were justified. The issue was whether the Thoroughbred Racing Act 1996 (NSW) (NSW Act) authorised Racing NSW to intervene and appoint an external administrator.

The NSW Act does contain an express power allowing Racing NSW to appoint an administrator to a race club. Section 14(2)(g) provides that Racing NSW may "appoint an administrator to conduct the affairs of a race club".

The existence of that power was not in dispute. However, the powers in s 14 must be exercised "for or in connection with" Racing NSW's statutory functions, including its core function under s 13(1)(b) to "control, supervise and regulate horse racing in the State". The Court held that the decision to appoint an administrator to the ATC was not made in the exercise of that function.

In explaining the limits of Racing NSW's statutory role, the Court referred to the well-known line from the Temby review of the racing industry that if too many functions were taken away from race clubs it might leave them with little to do but "staff the turnstiles and keep the pies hot and the beer cold". The reference illustrates the distinction drawn by the legislation between regulating racing itself and managing the commercial affairs of race clubs.

The Court also held that the decision was affected by jurisdictional error, including a material misunderstanding of accounting information relied upon by Racing NSW when assessing ATC's financial position.

Why the decision matters

The decision draws a clear boundary around the statutory role of Racing NSW. While the regulator has extensive powers in relation to the conduct and integrity of racing, the Court confirmed that those powers do not extend to intervening in the internal financial management or corporate governance of a race club simply because the regulator considers those matters unsatisfactory.

That point will be of particular interest to regional and provincial race clubs, many of which operate independently of Racing NSW but remain dependent on industry funding and infrastructure support.

At a policy level, the judgment also highlights a potential gap in the legislative framework. If the intention is that the regulator should be able to intervene in the governance or solvency of race clubs in circumstances where industry funds are at risk, that power would need to be clearly conferred by legislation.

Racing NSW has indicated that it will appeal Justice Kunc's decision.

Position in Victoria

The Victorian legislative framework is structured differently.

Under the Racing Act 1958 (Vic) (Vic Act), Racing Victoria is the controlling body responsible for the conduct and integrity of thoroughbred racing. Race clubs operate as separate entities with their own boards and management.

Unlike the NSW Act, the Vic Act does not confer a statutory power on Racing Victoria to appoint an administrator to take control of a race club comparable to s 14(2)(g) of the NSW Act.

Instead, the primary statutory control mechanism is licensing.

If serious concerns arose about the governance or financial position of a Victorian race club, the more likely regulatory pathway would involve a show cause process in relation to the club's racing-club licence. The Minister for Racing ultimately has power under s 24A of the Vic Act to suspend or cancel that licence.

In reality, the existence of that power would likely create strong pressure for the club to address the issue itself, for example by appointing its own administrator or restructuring adviser. Licence cancellation would likely be the ultimate regulatory sanction if those steps were not taken to the satisfaction of Racing Victoria.

Pointon Partners has a long history acting for participants across the thoroughbred and harness racing industries, including trainers, breeders, syndicators and industry bodies.

If you would like to discuss the decision or any related regulatory or governance issues affecting racing industry participants, please get in touch.

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