Smart refusal to be out of the race (5)
I believe the answer is:
natty
'smart' is the definition.
(I've seen this before)
'refusal to be out of the race' is the wordplay.
'refusal' becomes 'nay' (archaic word for 'no').
'to be out of' means one lot of letters goes inside another (some letters on the outside of others).
'the race' becomes 'tt'.
'nay' enclosing 'tt' is 'NATTY'.
(Other definitions for natty that I've seen before include "Smart, fashionable (colloq.)" , "Stylish" , "Dapper (colloq.)" , "Informally neat and well-dressed" , "Smart, spruce" .)