NEWCASTLE Jockey Club will take legal action or ask Racing NSW to withhold prizemoney from embattled entrepreneur Nathan Tinkler to settle an outstanding debt of about $100,000.
Some of the sponsorship money has been owed for more than six months.
NJC chief executive officer Cameron Williams said yesterday that while "no one likes to see a business relationship sour", correspondence to Patinack Farm about the debt went largely unanswered.
The club was left with "no choice" but to pursue every avenue to get the money paid.
"There are businesses out there, large and small, that have for some time reported having money owing from Patinack Farm and other Tinkler companies," he said.
"NJC has been by no means been treated anywhere more favourably; we're in the mix with all the others."
It was reported in News Limited newspapers yesterday that Sydney and Melbourne race clubs had withheld almost $600,000 from Mr Tinkler's racehorse winnings to offset the mining tycoon's debts.
According to the report, Racing NSW, acting on behalf of the Australian Turf Club, withheld prizemoney to the value of what Patinack Farm owed for stable rental, sponsorship and other debts.
The Melbourne Racing Club reportedly took similar action over $400,000 Mr Tinkler owed it, mainly involving unpaid sponsorship.
While Mr Williams declined to reveal the exact amount of the debt, the Newcastle Herald understands the club registered a loss of about $600,000 last financial year, including about $100,000 in unpaid sponsorship by Patinack Farm.
Mr Tinkler's racing empire sponsors three of the club's five feature annual races, including the Cameron and Newmarket handicaps and the Tibbie Stakes.
"We have been providing hospitality, as well as advertising and promotion, for a company that is not paying up," Mr Williams said. "We are now experiencing a cash flow shortage that was not initially budgeted for . . . I don't believe any business should have to carry this sort of provision for debt."
A spokesman for Patinack Farm said the company had been a "major supporter of the NJC over the last five years".
"We are committed to maintaining a long-term relationship with NJC and will continue to sponsor some of Newcastle's most important races," he said. "Patinack Farm has an excellent relationship and are in constant communication with NJC's chairman, board of directors and management team and look forward to working with them in future."
Mr Williams said the "best outcome" would be if the debt was paid immediately and the two organisations could move forward. But, he said NJC members and the public were "missing out" and the situation had gone on "too long".