In his failed defamation action against the publishers of The Sunday Age and The Sun-Herald in the NSW Supreme Court 10 years ago, Robbie's lawyers cited a statutory declaration - sworn on September 9, 1997 - in which David made an alarming claim.

Robbie had confided in 1986 that he feared he would be arrested over the murder of a horse trainer whose tortured body was found in a burnt-out car, David alleged in the statutory declaration to the NSW Thoroughbred Racing Board.

Robbie Waterhouse rejects this as ''lies and false allegations'' and has refused to further respond to questions about his brother's statement, which has gone unreported until now.

The Herald does not suggest Robbie was involved in the unsolved murder of the trainer George Brown in 1984.

Nor does his brother. But David, who has not spoken to his parents or siblings since 1992, stands by his sworn statement in which he recollects Robbie's remarks - about fearing arrest - to him and their legendary bookmaker father, Bill Waterhouse, on November 21, 1986.

On that day, Robbie was at St James Court in Sydney and was among five people committed to stand trial on charges - later quashed - of conspiracy to cheat and defraud bookmakers over the Fine Cotton ring-in scandal.

Robbie and his father had already been banned from every race track in the world since late 1984, when racing authorities deemed they had ''prior knowledge'' of the sting on August 18 that year at Eagle Farm in Brisbane. The winning horse, Bold Personality, had been substituted for a slower runner, Fine Cotton.

By David's account of events of November 21, 1986, Robbie had been shown a copy of that day's Daily Mirror, which splashed its front page with: ''Racehorse trainer murder: Bookie link - fresh lead.''

The Mirror did not name the bookie, but David's statutory declaration claims Robbie told his father: ''They're going to arrest me over the George Brown murder.'' David had asked Robbie: ''Why are you worried? This story refers to 'a leading bookie' - you don't have a licence, it can't be you.''

He alleged Robbie replied: ''But when George Brown was murdered, I did have a licence and I was a leading bookie.''

David: ''What would you have to do with George Brown?''

Robbie: ''He was involved in a couple of ring-ins for me but don't ask me any more questions - I don't want to talk about it.''

Questioned by the Herald, David denied he fabricated this conversation as part of a long-term campaign against his older brother.

In 1995, when Robbie tried but failed to have his ban from race courses lifted, David had told an inquiry that his brother was the mastermind of the Fine Cotton ring-in - a claim never proved and which Robbie has always denied.

When Robbie tried again in 1997, David submitted his statutory declaration mentioning the Brown murder. Robbie then withdrew his application, so the statement was not read in evidence.

A report 19 days later in The Sunday Age and Sun-Herald said Brown had been tortured and killed - his arms and legs broken before his skull was fractured - because he ''got cold feet'' and refused to carry out a ring-in.

The story, by Andrew Rule, suggested Brown was meant to substitute a faster horse for an outsider called Risley in the last race at Doomben, another Brisbane track, on March 31, 1984. Brown's remains were found in a burning car, off the freeway at Bulli Tops, after midnight on April 3, 1984, four months before the Fine Cotton substitution.

In the story, a form and breeding analyst called Arthur Harris said a heavy punter had told him that ''a couple of men'' had been sent to teach Brown a lesson, but they were ''high on drugs and went too far''.

Rule's story made no mention of David's statutory declaration.

But Robbie Waterhouse sued over the report. His lawyers alleged it carried imputations, including that he was a murderer and a torturer and had paid two men to kill Brown.

The Supreme Court dismissed those imputations. Then, in an amended statement of claim, Robbie's lawyers added an edited version of David Waterhouse's statutory declaration.

The statement of claim said David - along with Arthur Harris, who had been Robbie's form analyst in 1984 - had engaged in a campaign to prevent the Thoroughbred Racing Board from lifting Robbie's racecourse ban. Robbie's lawyers alleged Harris sought to convey the impression to Rule and other journalists that their client was involved in the murder of Brown.

Harris was also quoted saying that Robbie had asked him to check on the betting price for Risley in the Doomben race, and that Robbie revealed he had a bet on the horse.

Harris was named as a defendant alongside the newspapers in the defamation case, although Robbie did not sue his brother.

In August 2000, Justice David Levine dismissed the imputations alleged and ordered Robbie to pay the newspapers' costs and Harris's expenses.

While David's account was included in the judgment, it has not been reported until now.

David claims Robbie told him in 1992 he was out of the family trust, and they no longer wanted to see him at their office. David believes the ''turning point'' for this split was his refusal to use a multi-million-dollar painting he owned, a Frederick McCubbin called Bush Idyll, as a guarantee for Robbie and Bill's tax debt.

Bill Waterhouse, in his autobiography published last year, What Are the Odds?, refers to another art battle concerning his son.

In the Supreme Court in Melbourne, Justice Bill Ormiston had described David as a ''devious and unreliable witness'' and ''a person whose commercial morality was of the lowest order'' in his dealings in the mid-1980s with an art dealer, Brian Pearce.

The judge had dismissed a claim that David defrauded Pearce of $1.8 million in oil painting and race horse purchases, but he also dismissed David's counterclaim over an unpaid cheque worth $25,500, saying both men were involved in ''questionable dealings''.

David now says Pearce, who has since died, had tried to sell him a fake Van Gogh.

Bill's book also accuses the late underworld figure George Freeman of manipulating behind the scenes to make him and Robbie the ''fall guys'' of the Fine Cotton affair.

The conspiracy and other charges against Robbie and his co-accused were quashed and permanently stayed in 1988.

In 1992, however, Robbie was convicted of lying to the Racing Appeals Tribunal and he was sentenced to eight months' periodic detention at Long Bay jail. Admitting ''gross stupidity'', he denied being the ring leader, said he was following the money, and he claimed he lied to protect a punter and distance himself from the scandal.

His wife, the celebrated horse trainer Gai Waterhouse, had wept as she told the court: ''He has expressed remorse on many, many occasions and begged my forgiveness that he caused such shame on our family.''

Bill and Robbie finally succeeded in having their racecourse ban lifted 14 years after the Fine Cotton ring-in.

David, meanwhile, tried to sue for a share of the family trust but walked away with not a cent in 2000, claiming a ''nil-all draw'' when the judge also removed Bill and his brother Jack as trustees.

Last night, ABC1 featured a mini-documentary on the Waterhouse family. All but David were asked to contribute to the show.

However, the program had been edited following a complaint to the ABC from David. Gone from the preview version was the reference to brother betraying brother. Also gone was the suggestion that the family had funded his flamboyant lifestyle.

After years of family division and court battles, the narrator said the family has ''refused to be broken''.

David the broken-away member of the family, told the Herald: ''It's a terrible legacy having the Waterhouse name.''

On the day of Australia's biggest racing scandal, Fine Cotton's ring-in, Bold Personality, ran first - but with an unconvincing dyed coat and bandages on its legs to cover a bodged paint job.

The stewards were right onto it. They asked Hayden Haitana, the horse's trainer, for its papers. Haitana and two others would end up in jail over the fix, but when confronted by the stewards he fled the track and disappeared until a few days later.

Then he appeared on 60 Minutes claiming that his and his family's lives had been threatened if he did not go through with the ring-in. A man had shown him a gun and said: ''Do you want to end up like trainer Brown?''