Whelan v. Ontario Racing Commission et al., 2010 ONSC 3118

JudgeMolloy, Swinton and Cullity, JJ.
CourtSuperior Court of Justice of Ontario (Canada)
Case DateApril 14, 2010
JurisdictionOntario
Citations2010 ONSC 3118;(2010), 265 O.A.C. 85 (DC)

Whelan v. Racing Comm. (2010), 265 O.A.C. 85 (DC)

MLB headnote and full text

Temp. Cite: [2010] O.A.C. TBEd. JL.045

James Whelan (applicant) v. The Ontario Racing Commission and Woodbine Entertainment Group (respondents)

(562/09; 2010 ONSC 3118)

Indexed As: Whelan v. Ontario Racing Commission et al.

Court of Ontario

Superior Court of Justice

Divisional Court

Molloy, Swinton and Cullity, JJ.

June 30, 2010.

Summary:

A trainer and owner of standardbred horses (Whelan) was licensed by the Ontario Racing Commission to participate in horse racing at all tracks in Ontario. The Woodbine Entertainment Group (Woodbine) refused to permit Whelan to enter any horses to race at its tracks unless he first signed an access agreement. Whelan objected to signing the agreement. The dispute eventually went before the Ontario Racing Commission which ruled in favour of Woodbine. Whelan applied for judicial review.

The Ontario Divisional Court, Swinton, J., dissenting in part, held that Woodbine was entitled to insist on an executed access agreement for those who sought admission to its property and trainers or owners who sought to have their horses admitted there. Woodbine was also entitled to insist upon an executed waiver of liability and indemnity as part of its private property owner rights. Further, the Commission was entitled to decline to interfere with the requirement of an agreement to revenue sharing. However, the Commission acted unreasonably by permitting Woodbine to insist on an access agreement containing provisions that purported to give Woodbine absolute unfettered power to exclude horse racing participants who were licensed by the Commission and who had committed no fault. Until the agreement was amended to address the concerns identified by the court, it was not reasonable to require Whelan to execute the agreement as a condition to racing at Woodbine's track.

Gaming and Betting - Topic 602

Horse racing - Racetracks - Track rules - A trainer and owner of standardbred horses (Whelan) was licensed by the Ontario Racing Commission to participate in horse racing at all tracks in Ontario - The Woodbine Entertainment Group (Woodbine) refused to permit Whelan to enter any horses to race at its tracks unless he signed an access agreement - Whelan objected - The dispute eventually went before the Ontario Racing Commission which ruled in Woodbine's favour - Whelan applied for judicial review, asserting that, inter alia, Woodbine had no power to impose conditions that were not part of the Commissions Rules of Racing (the Rules) and since the Commission did not require participants to execute an access agreement, Woodbine could not do so either - The Ontario Divisional Court rejected the assertion - The Rules contemplated the existence of track rules that the Commission might or might not adopt - If adopted, they were enforceable by the Commission in the same manner as the Rules - Otherwise, they were merely additional requirements imposed by the racetrack - The two sets of rules could coexist subject to the proviso in rule 1.03 of the Rules that if there was a conflict the Rules governed - Since the Rules did not prohibit racetracks from requiring participants to sign agreements as a condition of racing, there was no conflict with the track rules - See paragraphs 30 to 36.

Gaming and Betting - Topic 602

Horse racing - Racetracks - Track rules - A trainer and owner of standardbred horses (Whelan) was licensed by the Ontario Racing Commission to participate in horse racing at all tracks in Ontario - The Woodbine Entertainment Group (Woodbine) refused to permit Whelan to enter any horses to race at its tracks unless he signed an access agreement - Whelan objected - The dispute eventually went before the Ontario Racing Commission which ruled in Woodbine's favour - Whelan applied for judicial review, asserting that, inter alia, the Commission's interpretation of the agreement was unreasonable - Whelan asserted that he was simply applying as a trainer to enter horses to race and did not seek access to the racetrack for himself - When his horses came to race, they were accompanied by qualified persons who were both licensed by the Commission and signatories to the agreement - Whelan's assertion focussed on the fact that the only reference to the agreement in the racetrack's rules was the stipulation that a signed agreement was required to obtain a stable area access sticker, without which there could be no access to the backstretch or the area where horses were stabled - The Ontario Divisional Court rejected the assertion - The Commission interpreted the agreement within the context of various competing interests in the industry - It took a contextual approach to its interpretation as was appropriate - The area was squarely within its expertise - The Commission's decision was entitled to deference - Its determination that the agreement also applied to any person who had care and control of a horse brought to the stable was not unreasonable - Further, in the administration of its business interests, it was open to Woodbine to require an agreement respecting things such as waiver of liability, insurance and wagering distribution agreements, even if that requirement was not specifically mandated in its written rules - Therefore, even if the situation did not fall within the strict language of the agreement or the racetrack's rules, it was open to Woodbine to require the trainer of any horse entering its stable area to sign an agreement with content equivalent to the access agreement, subject to the Commission's supervision - See paragraphs 37 to 42.

Gaming and Betting - Topic 602

Horse racing - Racetracks - Track rules - A trainer and owner of standardbred horses (Whelan) was licensed by the Ontario Racing Commission to participate in horse racing at all tracks in Ontario - The Woodbine Entertainment Group (Woodbine) refused to permit Whelan to enter any horses to race at its tracks unless he signed an access agreement - The agreement, inter alia, required persons seeking to race their horses at Woodbine tracks to agree to the sharing of wagering revenue on a formula imposed by Woodbine - Whelan objected - The dispute eventually went before the Ontario Racing Commission which ruled in Woodbine's favour - Whelan applied for judicial review, asserting that, inter alia, the Commission exceeded its jurisdiction by requiring him to agree to the wagering revenue sharing - The Ontario Divisional Court stated that it was clear that the Commission had no jurisdiction to compel agreement to any terms respecting the distribution of wagering revenues between track owners and other interested parties - However, the Commission did not approve or adopt Woodbine's rules requiring the execution of the agreement - It was therefore not the Commission, but rather Woodbine, that required participants to agree to its terms on revenue sharing - In that sense, it could not be said that the Commission required Whelan to accept Woodbine's revenue sharing formula - All the Commission did was decline to intervene when Woodbine required Whelan to accept the agreement - See paragraphs 43 to 48.

Gaming and Betting - Topic 602

Horse racing - Racetracks - Track rules - A trainer and owner of standardbred horses (Whelan) was licensed by the Ontario Racing Commission to participate in horse racing at all tracks in Ontario - The Woodbine Entertainment Group (Woodbine) refused to permit Whelan to enter any horses to race at its tracks unless he signed an access agreement - The agreement and the racetrack rules empowered Woodbine in its sole discretion to determine if there was a breach of its rules and gave Woodbine the right to impose penalties for any breach including suspension of privileges, loss of all fees and eviction from the premises - Whelan objected - The dispute eventually went before the Ontario Racing Commission which ruled in Woodbine's favour - Whelan applied for judicial review, asserting that, inter alia, the agreement contained a number of clauses that were unfair, arbitrary and prohibited by principles binding on the Commission - Further, the agreement required Whelan to accept all terms of the racetrack's rules without regard to any overarching supervisory role for the Commission and without the preservation of any rights to notice or a hearing - The Ontario Divisional Court reiterated that the Woodbine could not contract out of the Commission's jurisdiction to protect the rights of individuals licensed by the Commission to participate in racing - Further, Woodbine could not set itself up as a second tier regulator entitled to arbitrarily exclude individuals from racing at its tracks, in its own discretion, without any fault and without an opportunity to be heard - The Commission's conclusion that Woodbine was entitled to do so in the public interest was not reasonable - It was no answer that Whelan was not excluded from racing generally - His livelihood depended on being able to race at Woodbine's tracks - The court rejected the suggestion that Whelan could avoid the problem by placing his horses with another trainer who had signed the agreement - The subterfuge of a transfer for convenience could not be condoned - Woodbine was not to prohibit Whelan from racing on the sole basis that he had not signed the current version of the agreement - See paragraphs 49 to 84.

Gaming and Betting - Topic 603

Horse racing - Racetracks - Access agreements - [See all Gaming and Betting - Topic 602 ].

Gaming and Betting - Topic 626

Horse racing - Regulation - Commissions - [See third and fourth Gaming and Betting - Topic 602 ].

Gaming and Betting - Topic 635

Horse racing - Regulation - Judicial review of decision - A trainer and owner of standardbred horses (Whelan) was licensed by the Ontario Racing Commission to participate in horse racing at all tracks in Ontario - The Woodbine Entertainment Group (Woodbine) refused to permit Whelan to enter any horses to race at its tracks unless he signed an access agreement - Whelan objected - The dispute eventually went before the Ontario Racing Commission which ruled in Woodbine's favour - Whelan applied for judicial review - The Ontario Divisional Court concluded that the appropriate standard for factual findings and decisions within the Commission's jurisdiction to regulate horse racing was the reasonableness standard - The first two issues raised involved the interpretation and application of the rules of racing and the interpretation of an agreement governing the relationships between a racetrack and a horse trainer, both licensed and under the Commission's supervision - Those issues were squarely within the Commission's core area of expertise and were entitled to deference - The court could only interfere if the Commission's decision was unreasonable - The other two issues had aspects that were jurisdictional and aspects that were discretionary - In deciding whether it had jurisdiction, the Commission had to be correct - Otherwise, the standard was reasonableness - Once the Commission had correctly determined that it had jurisdiction, a decision as to whether to exercise its discretion in a particular situation was only required to be reasonable - See paragraphs 22 to 29.

Cases Noticed:

New Brunswick (Board of Management) v. Dunsmuir, [2008] 1 S.C.R. 190; 372 N.R. 1; 329 N.B.R.(2d) 1; 844 A.P.R. 1; 2008 SCC 9, refd to. [para. 24, footnote 7].

McNamara v. Ontario Racing Commission (1998), 111 O.A.C. 375; 164 D.L.R.(4th) 99 (C.A.), refd to. [para. 25, footnote 8].

Scott v. Ontario Racing Commission (2009), 253 O.A.C. 73 (Div. Ct.), refd to. [para. 25, footnote 9].

Sudbury Downs Case - see Ontario Harness Horse Association v. Ontario Racing Commission et al.

Ontario Harness Horse Association v. Ontario Racing Commission et al. (2002), 161 O.A.C. 99; 62 O.R.(3d) 44 (C.A.), refd to. [paras. 27, footnote 10 et seq.].

Ontario Racing Commission v. Ontario Jockey Club, [1967] O.J. No. 217 (C.A.), refd to. [para. 45, footnote 12].

Horsemen's Benevolent and Protective Association v. Ontario Racing Commission et al. (1997), 109 O.A.C. 24; 37 O.R.(3d) 430; 154 D.L.R.(4th) 104 (C.A.), refd to. [para. 45, footnote 12].

Flamboro Downs, Re, [1996] O.R.C.D. No. 5, refd to. [para. 45, footnote 12].

Woodbine Entertainment Group v. Hamather et al. (2008), ORC Ruling Number Com SB 017/2008, affd. (2009), 250 O.A.C. 16 (Div. Ct.), dist. [paras. 53, 89, footnote 13].

Robinson v. Ontario Racing Commission (2004), 186 O.A.C. 43 (Div. Ct.), dist. [para. 63, footnote 19].

Friedman v. Ontario Racing Commission et al. (2008), 237 O.A.C. 101 (Div. Ct.), dist. [paras. 67, 90, footnote 21].

Counsel:

Arlen Sternberg and Afshan Ali, for the applicant;

Brendan Van Niejenhuis and Brennagh Smith, for the respondent, Ontario Racing Commission;

P. David McCutcheon and Reena Goyal, for the respondent, Woodbine Entertainment Group.

This application was heard at Toronto, Ontario, on April 14, 2010, by Molloy, Swinton and Cullity, JJ., of the Ontario Divisional Court. The judgment of the Ontario Divisional Court was delivered on June 30, 2010, with the following opinions:

Molloy, J. (Cullity, J., concurring) - see paragraphs 1 to 85;

Swinton, J., dissenting - see paragraphs 86 to 107.

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2 practice notes
  • Whelan v. Ontario Racing Commission et al., 2011 ONCA 299
    • Canada
    • Ontario Court of Appeal (Ontario)
    • February 16, 2011
    ...of Woodbine. Whelan applied for judicial review. The Ontario Divisional Court, Swinton, J., dissenting in part, in a decision reported at 265 O.A.C. 85, held that Woodbine was entitled to insist on an executed access agreement for those who sought admission to its property and trainers or o......
  • Harness Horse Assoc. v. Racing Comm., 2012 ONSC 821
    • Canada
    • Ontario Superior Court of Justice of Ontario (Canada)
    • April 2, 2012
    ...A.P.R. 340 ; 2011 SCC 62 , refd to. [para. 35]. Whelan v. Ontario Racing Commission et al. (2011), 280 O.A.C. 104 (C.A.), reving, (2010), 265 O.A.C. 85; 2010 ONSC 3118 (Div. Ct.), refd to. [para. Morrissey, Armstrong and Ontario Racing Commission, Re (1958), 12 D.L.R.(2d) 772 (Ont. C......
2 cases
  • Whelan v. Ontario Racing Commission et al., 2011 ONCA 299
    • Canada
    • Ontario Court of Appeal (Ontario)
    • February 16, 2011
    ...of Woodbine. Whelan applied for judicial review. The Ontario Divisional Court, Swinton, J., dissenting in part, in a decision reported at 265 O.A.C. 85, held that Woodbine was entitled to insist on an executed access agreement for those who sought admission to its property and trainers or o......
  • Harness Horse Assoc. v. Racing Comm., 2012 ONSC 821
    • Canada
    • Ontario Superior Court of Justice of Ontario (Canada)
    • April 2, 2012
    ...A.P.R. 340 ; 2011 SCC 62 , refd to. [para. 35]. Whelan v. Ontario Racing Commission et al. (2011), 280 O.A.C. 104 (C.A.), reving, (2010), 265 O.A.C. 85; 2010 ONSC 3118 (Div. Ct.), refd to. [para. Morrissey, Armstrong and Ontario Racing Commission, Re (1958), 12 D.L.R.(2d) 772 (Ont. C......

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