Vindictive? Randwick Racecourse venue bans hirer

Sydney’s Randwick Racecourse offers a stunning venue for outdoor concerts and functions in the 2012 rebuilt Queen Elizabeth II (QEII) Grandstand. Run by the Australian Turf Club, its venue hire division ‘Events by ATC’ also offers Rosehill Gardens, Canterbury Park and Warwick Farm.

In early 2017 ENTECH Roashow hired the venue for the first time, and were impressed by the facilities and the enthusiastic staff. A second booking in May had a similar outcome, this time for SECTECH Roadshow which is partnership between ENTECH and a security technology publisher.

A fresh pair of contracts was issued by Randwick in May 2017 for the 2018 pair of events. Deposits were banked by the venue. Then in October 2017 the venue advised that the February 2018 date for ENTECH was not possible due to another booking. An alternative date was offered which meant rescheduling the five city roadshow.

At a meeting to discuss the matter ATC Events Manager Jimmy Busteed told ENTECH owner Julius Grafton that his job was to maximise revenue, and that the incoming client would spend more than ENTECH. This was possible since a seated lunch or dinner in the ballroom at Randwick would gross many times the floor rental that ENTECH pays.

Busteed reduced the rental on the replacement date by 7%, well short of the costs incurred to rebook and replan the roadshow. He failed to explain how the venue had not executed the hire contract which carries a highly unusual ‘self execution’ clause. Under this provision, after the hirer signs and returns the contract, the hirer ‘authorises the venue to execute the contract’.

ENTECH promoter Julius Grafton deals with venues across Australia, New Zealand and the USA and has not had a situation like this before. ‘We have had a venue offer us a date and then fail to issue a contract’, he said. ‘That goes against the spirit of the events industry which is fairly uniform on pencil dates being offered for a period, and we need that in order to get the other venues on a roadshow tour lined up in proper sequence. But to issue and contract and then – it appears – do nothing, well that smells like a strategy in this case. Randwick did it with both our 2018 events – they held the deposit, and didn’t return a countersigned contract’.

In the case of ENTECH 2018 and SECTECH 2018 the venue did not return a signed contract, and claimed that they did not hold one. Since the contracts were returned by email from the hirer it was impossible to prove that the venue held a signed contract. In this case the hirer asserted that the contract design was intended to give the venue an ‘out’ if a more lucrative event came along.

Subsequent letters to the board of the ATC containing this proposition met no response, until the acting CEO Matt Galinos wrote to apologise for the inconvenience and to reaffirm that the 7% reduction was all they would offer. They were in a winning financial position, having booked an open date at the expense of ENTECH rescheduling.

Grafton says he still doesn’t know whether the self-executing contract is a ploy, or a mistake. ‘I gave them plenty of chances to explain – at the meeting with Busteed, in letters to each board member, and in my final email to Galinos. I gave him a week to reply and he didn’t.’

The 2018 events were held at Randwick with a fresh set of enthusiastic staff – indeed across all four events at Randwick never the same staff were seen, with some saying there has been staff churn within the venue. Despite this the event day interactions between the hirer and the venue staff were efficient and pleasant. The decision was taken to rebook SECTECH at Randwick in 2019.

A terse email from Busteed’s team advised that they would not assist moving forward. They were, it appeared, banning SECTECH because of the problem of their own making that arose with ENTECH. A subsequent letter to Galinos seeking clarification was sent.

In that letter it was pointed out that ENTECH and SECTECH are not only separate companies but they have different shareholdings. The only thing in common is that ENTECH organiser Julius Grafton fronts both when it comes to venue logistics. It was put to Galinos that an apparent black listing of SECTECH was unfair to the other partners in SECTECH. There was no reply.

Grafton says the contract system at ATC gives them the power to cancel an event when it suits them. “They can say ‘hey, we didn’t get your signed contract’ and unless you mailed it back to them by registered mail you have no recourse. It flies totally the opposite to venue practice worldwide where if they get your deposit but don’t get your signed contract they call you. These guys are out of line”.