Non Raceday Inquiry – Written Decision as to Penalty and Costs dated 21 March 2025 – Bruce Negus

[1]  In our reserved decision of 6 December last we found that the Respondent, Mr Bruce Negus, committed a breach of r 1004AB(5) (now r 1004J(1)) of the NZ Rules of Harness Racing in that he was the Trainer in control of the horse MISSANDEI from which a blood sample was taken that had detected in it an Out of Competition Prohibited Substance namely Testosterone Cypionate (TC).

[2]  This is a serious racing offence. The maximum penalty is a fine not exceeding $30,000, and/or suspension for life, and/or disqualification for life.

[3]  We have received comprehensive written submissions from the parties as to penalty and costs. We summarise these.

Informant’s submissions as to penalty

[4]  The Informant submitted that a penalty in the range of $6,000 to $8,000 should be imposed.

[5]  Mr Negus had been found guilty of being a trainer in control of a horse that during out of competition testing had TC, a permanently banned substance, detected in it. This was the first and to date the only positive identification of TC in a horse that has occurred in New Zealand.

[6]  The Informant accepted that there was no evidence suggesting that Mr Negus himself administered the prohibited substance to the horse. But under the Rules, as the Trainer of MISSANDEI he was responsible for the breach and had to bear the consequences of the decision made by another person close to the horse to administer the prohibited substance to give the horse an unfair advantage.

[7]  It was crucial to the Industry’s social licence that it was not only free from doping, but that it was seen by the Industry and the public to be a clean sport. A horse that tests positive for a prohibited substance that was clearly designed to provide it with an unfair advantage seriously undermines this.

[8]  The relevant purposes and considerations of penalty were said to be helpfully stated in the Appeals Tribunal’s decision in RIU v L 13 May 2019 at [25] and [28]:

Proceedings under the Rules of Harness Racing, as is the position in all cases involving professional disciplines, are designed not simply to punish the transgressor, but crucially are to protect the profession/public/industry/and those who are to deal with the profession….

A common thread in cases involving serious misconduct is for the regulatory tribunal generally to focus on the interests and reputation of the profession as being more important than the fortunes of the individual offending member…. The Tribunal must endeavour to reach a proportionate balance between:

• the public interest
• the interests of the offending member
• the interests of the professional body as a whole
• the seriousness of the offending
• any aggravating and mitigating factors.

[9]  The Harness Racing Penalty Guide dated 1 February 2023 provides that for a presentation offence, a first offence attracts a starting point of $8,000 and a second offence attracts a starting point of two-year disqualification and a fine of up to $20,000. (The Adjudicative Committee observes that the more recent Harness Racing Penalty Guide dated 1 October 2024 has similar starting points.) As an out of competition positive not involving any suggestion of liability for administration, this breach was analogous.

[10]  Mr Negus had one other presentation offence (RIB v Negus, 2018). This involved presentation of a horse that tested positive to Ketoprofen, an anti-inflammatory medicine. Mr Negus admitted the breach and a fine of $5,500 was imposed. However, this conduct occurred after the breach that was the subject of the present penalty hearing. The Informant accepted that it was open to the Committee to treat Mr Negus as a first offender for the purposes of the Penalty Guide.

[11]  The Informant emphasised that the Penalty Guide was, as the name suggests, a guide only and the Committee would need to determine whether, and if so, to what extent, the penalty should reflect the absence of any evidence indicating that Mr Negus bore responsibility for TC being in the horse’s system. The Informant’s position was that no such departure was required as the Guide provided a penalty for presentation, as distinct from administration. Further, the need for general deterrence and the primacy of upholding the integrity of the Industry were paramount.

[12]There were no cases involving TC. The Informant identified two historical cases involving an anabolic androgenic steroid (Boldenone):

• RIU v GJ and CF Lee (2012). In that case, the respondents argued that the source of the Boldenone was the horses eating mouldy oats rather than via intramuscular injection. The Committee heard extensive evidence on this issue but ultimately was unable to reach a view. The Committee imposed modest penalties in the circumstances, of $300 per breach for a total penalty of $600.
• RIU v S Pinfold (2013). There was no evidence that Mr Pinfold had administered the prohibited substance Boldenone to the horse. The Committee imposed a penalty of $6,000.

[13]  The Committee was also referred to the UK case of British Horseracing Authority v H Morrison. In that case, the prohibited substance Nandrolone was detected in a horse trained by Mr Morrison. The Panel concluded that Mr Morrison was not involved in administration of the substance, but as the Trainer he was still responsible and had to be held to account for the breach. The penalty imposed was £1,000. This was reached by analogy to penalties imposed for raceday presentation offences in that jurisdiction.

[14]  The Informant observed that Mr Negus has had an extensive career in the Harness Racing Industry and is a well-respected trainer, although his previous breach for a presentation offence might negate a substantial discount for previous good character. MISSANDEI was also ineligible to race for a period of 12 months, which was to Mr Negus’s detriment.

[15]  No reduction in the fine was appropriate for matters Mr Negus raised during the proceeding in support of his argument that there had been an abuse of process:

(a) That the B Sample was sent for analysis by the RIU was found by the Committee to have been “unwise” and in breach of the Rules, but the Committee also found that this did not prejudice Mr Negus in any way.

(b) The Committee did not find any impropriety in the RIU’s conduct during the search of Mr Negus’s property.

(c) Mr Negus had raised a number of issues regarding disclosure, but there were no material disclosure breaches. Mr Irving’s evidence was that he forwarded any requests for disclosure onto NZRLS. Mr Howitt’s evidence was that he provided everything that was required to comply with the IHFA Guidelines. While Dr Wan’s two supplementary statements were provided late, they were disclosed as soon as they were received by the Informant, which had no control over when Dr Wan completed them. It was also relevant that there were avenues available to Mr Negus to obtain the disclosure that he complained of that could have been pursued, such as non-party disclosure applications.

Informant’s submissions as to costs

[16]  The Informant submitted that costs involved in the matter were high. This was said to be unsurprising given the duration of the proceeding and the manner in which the defence was advanced.

[17]  The usual approach where a defended charge was found proved was to award costs to the Informant of 60 per cent of actual costs incurred. The rationale for this was that the Informant was funded by the Industry through income generated by Industry participants and revenue generated by the TAB. It was not reasonable, where a person unsuccessfully defended a charge, for the Industry to have to bear the full cost of prosecuting that charge.

[18]  The Informant recognised that the costs sought were substantial, but there was no compelling reason to depart from that usual practice. The RIB did not have an unlimited budget to investigate and prosecute under the Rules of Harness Racing. The result of Mr Negus’s decisions about how to run his case had prevented the RIB from spending this money elsewhere.

[19]  Mr Negus had chosen to challenge every possible aspect of the Informant’s case. The Informant recognised that he was entitled to defend the charge against him in any way he chose. But having made that choice, it was appropriate that he, rather than the Industry, bore a significant portion of that cost.

[20]  The costs incurred by the Informant included:

(a) legal costs of current counsel;

(b) legal costs of previous counsel; and

(c) costs of expert witnesses, including witnesses from NZRLS, Racing Analytical Services Ltd and the Hong Kong Jockey Club Racing Laboratory.

[21]  The Informant set out a detailed breakdown of the costs incurred in tabular form. All amounts were GST inclusive. The overall total was $196,846.26.

[22]  The Informant submitted that an order for costs of $118,107.75 (60%) should be made.

[23]  The Informant also noted that it was the Adjudicative Committee’s usual approach to also order a contribution to its own costs.

Respondent’s penalty submissions

[24]  The Harness Racing Penalty Guide dated 1 February 2023 provides that for a presentation offence a first offence attracts a starting point of $8,000. The Respondent submitted that Mr Negus must be treated as a first offender since the 2018 offending (which he admitted) post-dated the current proved charge.

[25]  The Informant in support of its submission that a penalty in the range of between $6,000 – $8,000 should be imposed identified two Boldenone cases. The first RIU v JG and CF Lee (2012) was similar to this case in that the Respondents vociferously denied injecting horses with an intramuscular injection and spent thousands of dollars on veterinarians to establish this. They were fined a total penalty of $600. It was a precedent for the obvious argument that guidelines are just that – guidelines, and each case has to be considered on its own facts.

[26]  Mr Negus was entitled to a substantial discount for previous good character. At the time that this proven charge occurred he had an unblemished record. Mr Negus was before the Committee having been a trainer for 42 years. During that time, Mr Negus had trained about 1000 plus horses, and participated in about 8,800 races, resulting in about 550 wins and about 1260 placings.

[27]  Mr Negus has a high personal standing withing the Industry, and his opposition to any form of cheating (especially doping) or misconduct was well known.

[28]  Mr Negus mentored young drivers (on and off the track), by readily coaching them and providing them race opportunities to allow them to develop and reach their full potential.

[29]  Mr Negus had been recognised by the Industry and appeared in the media regularly, as shining a positive light on the Industry: being described in a 26th May 2022 Industry article as “Veteran trainer Bruce Negus – known as the Burnham Battler during his association with Courage Under Fire…”.

[30]  As it was accepted by the Informant that (if someone injected the mare) it was not Mr Negus, then there was no need for an individual deterrent. If the mare was injected there was nothing that Mr Negus could do to stop it, and he was of course caught by the strict liability offence.

[31]  In relation to general deterrence, the oft-quoted case of RIU v L noted that proceedings were designed not simply to punish the transgressor but to “protect the profession/public/industry”. A fine or penalty had no impact on deterrence for a presentation case, whereas it did in an administration case. The administration penalty regime recognised this fact, and the penalties were aimed at sanctioning the perpetrator with deservedly harsh penalties, aimed at sending a strong message to Industry participants and the public.

[32]  It was relevant that the monetary cost to Mr Negus of the positive was that the horse who at the time of the positive test had earned around $130,000 was ineligible to race for a period of 12 months. During that time Mr Negus had lost not just training fees but potential percentages of stake money.

[33]  MISSANDEI was stood down for over 12 months (by 6 days), as Stipendiary Steward Mr Ydgren stood MISSANDEI down until 18 October 2018, when the Judicial Committee had stood her down until 12 October 2018 (12 months from the positive test result).

[34]  A TC standdown was not equivalent to a non-steroid standdown. There was no standdown and thus no additional financial impact for a non-steroid presentation charge.

[35]  The 12-month standdown imposed a significant Industry financial impact (estimated as $20,000) and the Respondent submitted this should be taken into account when determining the level of penalty.

[36]  The Respondent accepted that the Adjudicative Committee found that the intentional breach of the Rules by the RIB did not prejudice Mr Negus in any way. It was ironic that the Informant relied upon case law which states that proceedings under the Rules of Harness Racing are to protect the reputation of the profession when the very body that polices the law was found to have intentionally acted in contravention of one of the very basic rules in relation to testing. The fact that both Mr Negus and other members of the Industry may have suffered a significant loss of confidence in the Informant due to this intentional breach of the Rules should be of concern to the Committee, however, it was accepted that this was not something that the Committee was likely to take into account when assessing penalty, although Mr Negus submitted it should be.

[37]  Mr Negus said he had sought third party disclosure. NZRLS which was the prime focus of disclosure, and which fell under the Rules and was a party with respect to disclosure, simply would not respond, as it considered it had provided all relevant disclosure. The problem was that what the Informant considered as relevant differed significantly to what Mr Negus’s experts considered relevant.

[38]  Mr Negus contended that information was withheld by Mr Howitt (NZRLS) by not providing all available data, thus restricting independent expert scientific review of the data and analytical processes. As Mr Howitt is not an expert in matters toxicology or biochemistry, he would not know what the Respondent’s experts were looking for in order to conduct a detailed review of the data. Mr Negus accepted that the Committee had rejected his submission that this lack of readily available data disclosure impacted negatively on the defence. However, Mr Negus submitted that delays in disclosure were responsible for additional delays which led in turn to additional costs.

[39]  The Respondent maintained that ongoing failures by the Informant to provide relevant and timely disclosure were directly responsible for the length of the proceedings, adjournments and the subsequent costs for both parties. Mr Negus submitted that the various failures to disclose relevant material resulted in him taking an understandably rigorous approach to defending this matter. A number of alleged failures by NZRLS were identified. This was submitted to be relevant to penalty as well as to costs.

Respondent’s submissions as to costs

[40]  The Respondent stated that throughout the hearing he had made numerous criticisms of the manner in which the Informant had advanced its case. The Respondent had put the Informant to proof and suffered from ongoing issues with disclosure (which were previously described in the penalty submissions). Mr Negus said that delays had incurred and the need to reconvene the hearing arose from the failures of the Informant and not the Respondent.

[41]  Mr Negus continued to maintain that the processes followed by NZRLS were sloppy. For example, the decision to send the B sample outside the Rules was properly challenged. He had chosen to challenge every possible aspect of the Informant’s case due to various matters that were problematic: the change of evidence relating to the way the vials were placed following being drawn; the storing of samples; the losing of samples; the transportation of samples. The approach of Mr Negus was a direct result of concerning matters that arose from the manner in which the prosecution was conducted.

[42]  The Respondent submitted that the significant legal costs incurred by the Informant arose from its own failures rather than any culpable actions by Mr Negus. Whilst none of these failings by the Informant impacted upon the Committee’s decision as to guilt, these failings could and should impact upon the cost decision.

[43]  Mr Negus submitted that the Informant should not be awarded 60 per cent of its costs and that 20 per cent of costs was equitable. In this case confidence in the system required the Adjudicative Committee to penalise the Informant for actions which fell short of the professionalism required of Trainers and Drivers in the Industry.

[44]  Specific reference was made to costs with respect to counsel first engaged by the Informant and to Meredith Connell. The costs relating to initial counsel were only incurred because the Informant was frustrating disclosure, including the testing of the last two test tubes. No challenge was made to the reasonableness of the costs in terms of the time spent by counsel in the matter. However, it was submitted the late submission of evidence by Dr Wan was what had led directly to the adjournment, and thus any cost associated with the second hearing should not rightly be placed at the cost of Mr Negus.

[45]  Further, late and partial disclosure by NZRLS had dictated the length of the second hearing.

[46]  The Respondent submitted that Mr Negus should not be accountable for any costs incurred after the end of the first hearing.

[47] The Respondent further submitted that actions by the Informant deserved some condemnation by the Committee. The Informant clearly breached the Rules of Harness Racing with regard to the B sample. There were significant difficulties in relation to obtaining relevant disclosure. It was further submitted that the Adjudicative Committee costs should reflect this.

Penalty

[48]  The Harness Racing Penalty Guide dated 1 October 2024 provides that a first presentation breach attracts a starting point of $8,000 and a second offence attracts a starting point of two-year disqualification and a fine of up to $20,000. We add that the Penalty Guide operative at the time of the breach was the JCA Penalty Guideline, effective from 1 May 2015, which provided a similar starting point for a first breach. We accept that this out of competition positive which does not involve any suggestion of liability for administration, is analogous.

[49]  We further accept that while Mr Negus has one other presentation offence (RIB v Negus, 2018), the details of which are described above at [10], this conduct occurred after the breach that is the subject of the present penalty hearing. The Informant accepted that it was open to the Committee to treat Mr Negus as a first offender for the purposes of the Penalty Guide. We agree.

[50]  The starting point is therefore a fine of $8,000. While the Penalty Guide is just that, a guide, we believe this starting point is apt. We obtain little assistance from the cases cited by the Informant. The drug that is the subject of the charges is different in the New Zealand cases and the UK case is helpful only to the extent that it draws an analogy with penalties imposed for raceday presentation offences, as it is a different penalty regime.

[51]  In the circumstances of this case the need for deterrence or denunciation is not a primary consideration. The source of TC is not known. As we noted in our earlier decision at [384], the charge is not that Mr Negus administered TC to MISSANDEI. There is a need, nevertheless, to uphold the integrity of the Industry. We agree with the Informant that it is crucial to the Industry’s social licence that it is seen by participants and the public to be a clean sport. A horse that tests positive for a prohibited substance that is clearly designed to provide it with an unfair advantage seriously undermines this.

[52]  We accept the 12-month stand down of MISSANDEI from 12 October 2017 to 12 October 2018 (although we note the Respondent states it in effect it was until 18 October 2018) was a financial impost for Mr Negus.

[53]  Mr Negus has had a long and distinguished career in the Harness Industry. This has to be reflected in the penalty we impose. We do not accept the Informant’s submission that his subsequent breach of the presentation Rule should negate a substantial discount for previous good character. It is a matter to be considered in the round.

[54]  There was of course no admission of the breach but that is simply the absence of a mitigating factor. Mr Negus was well within his rights to defend the charge.

[55]  One matter not raised in penalty submissions but to which weight should be given, is the full co-operation of Mr Negus with the RIU when they visited his property on 18 October 2017. He conversed willingly with Mr Irving, answering all his questions, and did not object to the search of his property.

[56]  Giving weight to these mitigating factors, leads us to a one third reduction from the $8,000 starting point. This results in a fine which we round down to $5,300.

[57]  We believe the Respondent’s criticism of the RIU investigation is best considered with respect to the costs award.

Costs

[58] The hearing of this matter took an inordinate amount of time. This was due in part to the Respondent challenging every aspect of the Informant’s case, which we hasten to add is his right, and the requests for further testing and then the testing of the two further vials of sample 129275, and the hair testing of MISSANDEI. Covid lockdowns both in New Zealand and the UK added substantially to the delay in the matter being heard.

[59]  The Respondent contends that the two-day second hearing was due solely to Dr Wan’s second brief of evidence (supplementary statement of 24 October 2023) being provided late. He also states that the further statement of 20 March 2024 was late. We accept that the Informant disclosed these as soon as they were received.

[60]  Dr Dunnett was not available to give evidence by way of AVL at the second day of the October 2023 hearing on the ground that he had not had sufficient time to read and digest the contents of Dr Wan’s supplementary statement, having only received it the day before. For example, he not been able to locate and read the articles that Dr Wan had referenced in his report. We thus adjourned the hearing to permit the Respondent to call Dr Dunnett. We asked that this be in a timely manner. As it transpired, this was not until the following year.

[61]  We further observe that the Respondent wanted Dr Dunnett to give his evidence in person and that due to Dr Dunnett’s personal circumstances he was not able to come to New Zealand for some months after the first two-day hearing. There was thus a delay, and the Informant had to work to Dr Dunnett’s schedule. This is relevant to the Respondent’s criticism of the timeliness of the presentation of Dr Wan’s last brief of evidence, which was a response to the briefs of evidence from the Respondent’s expert witnesses, including that from Dr Dunnett, which was provided on 29 February 2024 after an initial date of 15 January had been notified to the Committee (Respondent’s memorandum of 28 November 2023). We note that Mr Reeve, Dr Dunnett and Professor Shaw had the opportunity overnight to consider Dr Wan’s third statement (of 20 March 2024) (which the Informant ultimately did not rely on), and they commented on it when giving their evidence at the second two-day hearing. They were thus able to respond to any criticism Dr Wan had made of their reports and indeed did so, at length.

[62]  Mr Howitt and Dr Batty were also called to give further evidence and were cross-examined at the second hearing. The second hearing was a full two days and went well beyond the consideration of matters raised in Dr Wan’s latter two briefs. We do not accept the Respondent’s submission that Mr Negus should not be accountable for any costs incurred after the end of the first hearing.

[63]  We address the Respondent’s allegations of abuse of process.

[64]  We have previously held that the RIU’s actions in testing the B sample were not provided for in the Rules. The B sample is the Respondent’s sample. However, in the particular circumstances of this case we have not found that this prejudiced Mr Negus in his defence.

[65]  We heard evidence that a RIU vehicle was parked in such a manner as to prevent the front gate to Mr Negus’s property being opened inwards on the day the RIU visited his property and questioned him. However, there was no evidence before us that this was a deliberate ploy by the RIU to prevent entry to and egress from the property, and we did not draw that inference in our decision of 6 December. There was no evidence that Racing Investigators stopped anyone from leaving the property. The questioning of Mr Negus and the search of his premises we held was within the Rules.

[66]  Mr Negus has raised issues with disclosure. Mr Howitt has stated that he provided the information required by the IHFA Guidelines, and we further note there was no application for non-party disclosure.

[67]  We accept there appears to have been some delay in 2018 when the Respondent was seeking disclosure by the Informant of data from NZRLS. The Informant has not been able to address this issue in any depth in its penalty submission and this is perhaps understandable as it was Christchurch counsel, who was instructed by the RIU at that time, and not Mr Dow. We are not able to ascertain the source of this delay, but we observe that Mr Irving, the Racing Investigator, simply forwarded email requests to NZRLS upon their receipt. We factor this into our award.

[68]  The costs claimed by the Informant are high. The award must be just and reasonable, and the costs, of course, real.

[69]  The Informant requests that the award be 60 percent; the Respondent seeks 20 per cent. We are aware that 60 per cent is the usual figure, although this is simply a rule of thumb.

[70]  Looking at all the matters in the round, we make an award at the level of 50 per cent.

[71]  There are Adjudicative Committee costs. Having regard to totality, we limit these to the sum of $7,000.

[72]  Costs in the sum of $98,000 (approximately 50%) plus $7000 are awarded to the RIB. The total sum is thus $105,000.