Membership exposure to litigation costs to be addressed after heated owners' AGM

The status quo won out at a heated AGM of the Association of Irish Racehorse Owners on Tuesday night as attendees voted against a motion to allow any member of the association to be eligible to stand for election as its representative on the HRI board.

However, the council was challenged from the floor by James Mescall – who withdrew his candidacy for the council on the night – as to whether the membership is indemnified against any liability arising out of current or future litigation proceedings. It also emerged that the association has no trustees, as required in its constitution.

The issue has come into focus due to the fact that James Gough, a council member, is suing the association for costs and damages after seeking an injunction to prevent the appointment of Caren Walsh as his successor to the HRI board, citing an undemocratic process. Costs alone are expected to be upwards of €60,000.

James Mescall: withdrew his candidacy for the councilCredit: Caroline Norris

Speaking subsequently, the council's outgoing treasurer Dr Brendan Doyle accepted that the 2,000-plus members – of which over 100 attended an AGM that was described by some attendees as particularly acrimonious – aren't indemnified.

Doyle stated that the issue of incorporating the association to protect members against personal liability will be discussed at an upcoming council meeting.

"We are not indemnified, but we don't anticipate having any issues for the members," he said. "We are having a council meeting next week and we will be discussing that as a matter of priority.

Dr Brendan Doyle, AIRO's outgoing treasurer, confirmed the membership are not indemnified against potential liabilities

"No member is going to be in any way out of pocket. That was stated at the AGM in my treasurer's report. I reassured the members that the costs for the existing case are anticipated in the region of €60,000 or €70,000, and that we have over €100,000 in the association's account. And in the event that the association is successful, we will pursue the other side for our total costs with vigour."

It was also put to the top table, which was chaired by Brian Polly, that the council might have engaged with the minister for agriculture Michael Creed prior to Gough initiating legal proceedings, on the basis that it is within the minister's remit to rule on such disputes as per the Horse Racing Ireland act, and that doing so might have avoided a potentially costly legal row given that Gough had already expressed his objections in writing to AIRO.

"John Power responded to that at the meeting," Doyle said, referring to his fellow council member, a Limerick-based solicitor. "He said that once James Gough initiated the high court action, we were legally obliged on behalf of our members to defend the case. It was only subsequently Gough started invoking the minister."

AIRO has been without any trustees since the death of Johnny Harrington in 2014. Its constitution states that its property shall be invested in two or three trustees on behalf of its members, so the absence of any undermines its legal status.

"It was acknowledged at the meeting that we don't have trustees and we will be addressing it," Doyle said.

The rejection of the motion to allow any member of the association stand for election to the HRI board, or be able to propose and second a candidate, means those privileges remain the preserve of AIRO's 12-member council.

The motion was one of five proposed by restricted trainer Denis Coakley. Although the council had not formally met since the motions were issued, it explicitly opposed each motion. One, which proposed all motions be published on the AIRO website ten days ahead of an AGM, was passed by the membership.

In the end, the two candidates on the ballot paper due to contest the outgoing council seats held by Doyle, Judy Maxwell and John Weld withdrew from the process, meaning the sitting trio were all returned.

Mescall and Roy Clarke withdrew during the meeting as they felt the preclusion of those who hadn't been members 14 days ahead of the AGM compromised their prospects, while Stephen Thorne had withdrawn ahead of the event.

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Richard ForristalIreland editor

Published on 28 March 2019inNews

Last updated 17:25, 30 March 2019

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