A cautionary account of a significant Supreme Court ruling based around interpretation of "unauthorised gambling" of some 270 bets under the Bookmaker Telephone Betting Rules 2001 (Victoria).
The story could simply read that the punter owes the bookie - and the not insignificant amount of $150,000.
But it is quite some story and with possibly serious ramifications for punters, bookmakers and regulators.
There is no dispute that the bets involved here (and read on), some 270 of them were placed, or that were recorded properly within the required regulatory Racing Victoria framework, though the bookie admitted to a breach of some paperwork.
And with that, Judge Douglas Trapnell, after a two-day hearing in the Country Court in August 2022, found in favour of the bookie who had taken his “client” to court to redeem the outstanding debt.
But after subsequently being granted leave to appeal, a Court Of Appeal bench handed down a landmark decision last Wednesday, ruling in favour of the punter and that the debt no longer stood.
The reason? Too simplify, before exploring the legal discussions - because the bookmaker failed to obtain a signed authorisation to accept telephone bets and lodge it with Racing Victoria as required under the rules or in terms of the Act – it hence constituted “unauthorised gambling.”
Or as relevant: Critical to the decision is that all gambling is illegal unless it is authorised and a strict procedure is set down for telephone betting, which is quite different from in person betting.
And what does that mean? It means the law stands alone.
In what might be seen as a David V Goliath battle, though the David in this case is the seeming Goliath in bookmaker of 50 years, David McLauchlan, the David, a Melbourne businessman, horse owner and the punter, in Allen Ng.
Ng says he fought the law and now suggests that law won.
The obvious easy perception is that he “taken a knock” on the $150,000.
Not so he says. Or more so the law.
“It has cost me multiples of that to even get this far. It would have been easier to pay the bookie then to get to the Supreme Court, simply to prove a legal point, not just for me, but maybe for all punters,” Ng said.
“It has cost me more dollars than what I owed. It’s a hollow victory, if you call it that, add in the mental and financial stress along the journey. I was never out to bash bookies, I sought advice and help from Racing Victoria, but I was left to fend for myself, I was just trying to ensure all the rules were being complied with.”
Legally the appeal and decision simply relied upon statutory interpretation of the Bookmakers’ Telephone Betting Rules (2001) – or telephone bets placed without signed authority of client and without lodging authority with Racing Victoria – were gambling unauthorised unless authorised.
The Supreme Court found in favour of Ng’s argument – the telephone bet in breach of r 4.2 of the Telephone Betting Rules is ‘unauthorised gambling’ and underlying agreement void under s 2.4.1 of Gambling Regulation Act 2003.
The term “unauthorised gambling” is mentioned 76 times in the Supreme Court findings, with notation that a breach carries a relevant penalty of 1000 units or imprisonment of two years (or both).
It should raise alarm with all authorities and have punters perhaps checking their own engagements.
And before you ask if the punter had won, would he have been entitled to take the money, the Supreme Court address that in findings: Finally, the respondent (McLauchlan) submitted that it would be an absurd outcome if participants who, by no fault of their own, engaged in unauthorised gambling and were not entitled to collect the winnings of that unauthorised gambling. We reject this submission in light of the provisions of the Gambling Act set out above at [11] to [13] which address the consequences that flow from ‘unauthorised gambling’ namely: (a) (b) section 2.4.1 which deems wagering agreements void if they relate to unauthorised gambling; and section 2.2.2 which enables the participant who has paid or staked money or other valuable consideration to recover that amount from each person who conducted the unauthorised gambling on a joint and several basis. “
Putting aside the legal jargonise, though it will be more relevant for all participants, punters regulators and bookmakers to address if not at least refresh, the background to the case is as colourful, if not unfamiliar.
Ng was introduced to McLaughlan by a mutual associate, he took his details and entered those into a RV computer program (without the central paperwork this case revolves around) before starting credit betting transactions.
The County Court case revealed McLauchlan paid out $104,894.50 to Ng while the punter returned $88,600 for losses incurred before the period in question re the $150,000 that was over April 14 and 18 of 2020.
The actual sum for the losing bets April 14-18 was $152,000 and it is uncontested that Ng paid $2000 on September 21, leaving the original “disputed” figure at the $150,000.
The outcome gets back to that interpretation of “unauthorised gambling” via the betting act and written authority.
As the Court wrote re “Written Authority” (a) (b) 28 Unless otherwise expressly authorised by the relevant Controlling Body, prior to a Bookmaker conducting any betting transactions with a client using a Telephone Betting System, the Bookmaker must obtain a written authority from the client authorising the Bookmaker to accept bets from the client or the client’s authorised agent.
“The written authority must disclose the full name, address and date of birth of the client and any person that is authorised by the client to conduct betting transactions for and on behalf of the client.
“Except where otherwise expressly authorised by the relevant Controlling Body, a Bookmaker must not accept bets using the Telephone Betting System from any person unless: (i) (ii) the person placing the bet has signed and completed the written authority referred to in Rule 4.2(a) or is the authorised agent of a client as disclosed in the written authority and is transacting the bet on behalf of his or her principal; and the Bookmaker has first lodged with the Controlling Body a true and complete copy of the person’s signed and completed written authority.
“There was no evidence that the respondent received authorisation from Racing Victoria as the ‘Controlling Body’11 exempting him from complying with the requirements of r 4.
There is no despite in the interim that Ng provided a driver’s license to Racing Victoria stewards on February 26, 2020 (after the focussed betting period which had ended over a week earlier.)
The County Court accepted that Ng’s home address, banking details, email and mobile telephone were entered into to an RV approved computer.
But Ng emailed Ian Durrant on October 7, 2021, Racing Victoria’s Betting Administrator, who gave evidence at the County Court trial, seeking advice as to his status knowing he had not signed any paperwork or advised of any credit limits or received a responsible gambling message.
He says he was (and has emails to prove) referred to seeking Freedom of Information at his cost to further the matter.
“I wasn’t trying to be smart, just seeking clarification of rules, terms and conditions, just to be inquisitive and know where I stood.”
“To me, all this has been a matter of principle. Perhaps there are other punters in a similar situation or that is something they could look at, maybe it’s something that helps them.”
“I’m still well out of pocket despite what they say is winning and maybe the matter isn’t over or closed, there are still legal options maybe, but all I was after was what I thought was justice, nothing else or more.”
And though the maters are finalised by last week’s Supreme Court decisions, Ng, says he is considering his position.
“We are still going through the matter of costs which are substantial obviously, but there has been personal and professional hurt and injury, family strain, financial and real, all things that still remain after all this time.”
The Supreme Court decision is compelling reading in its 27 pages. Obviously, it sets aside (though relies upon) the 2022 Country Court case.
The Victorian Court of Appeal's decision illustrates the critical importance of regulatory compliance in the gambling industry. By ruling that the unauthorised telephone bets were void, the Court reinforced the legislative intent to prevent unauthorised gambling and protect the integrity of gambling activities.
The court had regard to the purposes of the legislation relating to gambling in construing the meaning of the legislation and the rules.
It serves as a cautionary tale for bookmakers about the potential legal and financial repercussions of failing to adhere to statutory and regulatory requirements.
Read the Decision of the Court of Appeal here:
Allen Ng was represented by Marcus Clarke K C and Ms Vanessa Plain (instructed by Kenneth Tng of Lim and Tng Lawyers.
David McLauchlan was represented by Damien Sheales and Tim Purdy.
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