MUMBAI: Gallops, the racecourse restaurant popular with food lovers across the city, has got a taste of the legal whip and will soon be turfed out from the club. The 2-horse feud that trotted on for years between the Royal Western India Turf Club (RWITC) and BJR's, the firm that runs Gallops at the Mahalaxmi racecourse, has been adjudged in the club's favour. The arbitrator has directed BJR's to vacate the club's premises and pay RWITC Rs 34 crore in damages. It will also have to pay the club an additional sum at a rate of Rs 6.3 crore per annum till it hands over possession.

The club had terminated its contract with Gallops, prompting the legal battle to land in the Bombay high court in 2011, when an arbitrator was first appointed. In the intervening years, there was a change in the constitution of the arbitral panel.

Former Bombay high court judge, Justice F I Rebello, the sole arbitrator, finally held that "RWITC has been able to establish that the contract was validly terminated for breaches on part of Gallops''.

The award passed on September 25 was made available on Tuesday.

"Based on orders of city civil court, the respondent—Gallops—continues to be in possession,'' said the arbitral award before adding that such continued possession deprived RWITC of profits and possession of its premises.

The club, which has prized fillies, and the restaurant, which served prized fillets, were locked in a long-drawn legal dispute over whether the restaurant was its tenant, as it claimed.

Gallops had even gone to the small causes court to claim its tenancy rights and to protect itself from being dispossessed after the club terminated its contract.

The HC had initially appointed former chief justice of India S P Bharucha as the arbitrator to resolve their issues. He recused himself. Later, former chief justice of Delhi high court A P Shah was appointed and when he too recused, Justice Rebello was the choice of both parties.

Gallops claimed it is the club's tenant at the Mahalaxmi racecourse since 1986. The club, itself a lessee of the Municipal Corporation of Greater Mumbai since 1914, said it was not authorized to induct any sub-tenants. The club's case was that it had only entered into a "conducting agreement" with BJR to run the restaurant and provide catering services to its many members and their guests.

The club said that in 2008 it had invited catering bids and had appointed BJR's as its catering contractor. Calling themselves tenants is incorrect and illegal, the club had argued.

Each side had dug their hooves in. The small causes court had in 2010 prima facie held that the restaurant run by BJR was a sub-tenant and must be permitted to serve non club members too.

The restaurant management had argued that the club was only in the business of conducting horse racing and not of running restaurants. The club had "camouflaged its agreement to circumvent the provisions of the lease between the corporation and the club'', argued the restaurant.

The arbitrator heard both sides even on the preliminary point of maintainability of the arbitral panel. In May, he first held that arbitral panel had jurisdiction to hear the dispute and now has found that the club was on the right track. It had argued that its memorandum of association allows it to "establish any Clubs, Hotels or other conveniences in connection with the property of the Club".

Welcoming the order, Geoffrey Nagpal, managing committee member of RWITC, said, "We have a strong order in our favour for Rs 34 crore. We have to consult our legal team to recover our dues in the best way and at the earliest."

Courtesy TOI
Swati Deshpande | TNN