Citation: [2016] NSWLC 25
Court: Local Court of New South Wales
Date: 16 December 2016
Judge(s): McIntyre LCM
Background
The Office of Liquor Gaming and Racing prosecuted a major wagering operator for publishing gambling-related advertising in contravention of subclause 12(1)(h) of the Racing Administration Regulation 2012 (NSW). The alleged contraventions related to advertisements published on 27 and 28 August 2015, both online and in a metropolitan newspaper. The advertisements promoted offers including a 25% bonus on certain bets, a loyalty rewards programme, a competition called "Luck of the Draw" featuring a bonus bet, and related promotions tied to rewards programme membership.
The core dispute was whether those advertisements constituted an offer of a credit voucher or reward as an inducement to participate in gambling activity, including as an inducement to open a betting account. The operator denied several elements of the offences and also raised a statutory defence under subclause 12(4) of the Regulation, arguing that internal legal review constituted written approval for publication from an authorised person.
The operator accepted that it was neither a non-proprietary association nor a licensed wagering operator, meaning subclause 12(3) applied and rendered it subject to the same prohibition as the primary publishing entities.
Legal Issues
- Whether the Racing Administration Act and its Regulation are beneficial (remedial) in nature, requiring a wide construction, or punitive in nature, requiring a narrow construction against the prosecution
- What the word "offer" means in subclause 12(1)(h): the ordinary non-technical sense, or the strict contractual sense
- Whether each advertisement constituted gambling advertising under the Regulation
- Whether each advertisement offered a credit voucher or reward within the meaning of the Regulation
- Whether the credit voucher or reward was offered as an inducement to participate in gambling activity or to open a betting account
- Whether the subclause 12(4) defence applied: specifically, whether the operator's lawyers were employees or agents of TAB Limited, and whether email correspondence constituted written approval for publication
Decision
Issue 1: Nature of the Legislation
The court held that the Racing Administration Act and its regulations are beneficial in nature, not punitive. The objects of the Act expressly aim to minimise the adverse social effects of lawful gambling, and clause 12 addresses a range of harms associated with gambling advertising. Accordingly, the court adopted a wide rather than narrow construction of the regulation's provisions (at [8]-[13]). The principle of strict construction against the prosecution was treated as a last resort, consistent with the High Court's approach in Waugh v Kippen (at [5]).
Issue 2: Meaning of "Offer"
Drawing on the reasoning in Wallace v Walplan Pty Ltd, the court held that the word "offer" in the context of this consumer-protective regulation means "to make available" in the ordinary non-technical sense, not an offer capable of immediate acceptance in the contractual sense (at [28]-[30]). This interpretation applied across all advertisements under consideration.
Issue 3: The Individual Advertisements
The online "Ignite Your Friday Night" advertisement made available a 25% bonus on the advertised price in the first try-scorers market. The court found this constituted an offer of a reward and an inducement to participate in gambling activity (at [31]-[41]). The newspaper version of the same advertisement was found to contain the same elements (at [67]-[70]).
The TAB Rewards programme and associated promotions ("Owner for a Day" and "Make Your Socceroo Debut") were found to constitute gambling advertising because participation required either opening a wagering account or holding a Cash Loyalty Card obtained by placing cash bets. These promotions offered rewards as an inducement to open a betting account or to participate in gambling activity (at [48]-[59]).
The "Luck of the Draw" newspaper advertisement, which offered a bonus bet on a specific result market during August, was found to constitute an offer of a credit voucher or reward as an inducement to participate in gambling (at [60]-[66]).
Issue 4: The Subclause 12(4) Defence
The court held that subclause 12(4) was directed at publishers of advertisements (such as newspapers or website operators) who have written approval from the person placing the advertisement. The operator argued that its internal legal team, employed by a subsidiary called Tabcorp Assets, were employees or agents of TAB Limited for the purposes of the defence. The court rejected that argument: the lawyers' employment contracts identified Tabcorp Assets as employer, and no evidence established that TAB Limited was their client or principal (at [77]-[82]).
The court further rejected the argument that email correspondence in which lawyers reviewed promotional content for regulatory compliance constituted written approval for publication within the meaning of subclause 12(4). The emails were, in the court's view, legal advice on compliance, not authorisation to publish (at [83]-[92]). The defence therefore failed entirely.
Orders Made
- All offences proven
Key Takeaways
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Regulations aimed at minimising social harms associated with gambling advertising are beneficial in nature and should be construed widely, not narrowly against the prosecution; strict construction is a last resort (at [5], [8]-[13]).
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In the context of consumer-protective gambling advertising regulations, the word "offer" means "to make available" in the ordinary non-technical sense, not an offer immediately capable of acceptance in the contractual sense (at [28]-[30]).
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A bonus financial return advertised above the base odds or advertised price, whether described as a percentage bonus or a bonus bet, can constitute a "credit voucher or reward" within the regulation's prohibition, assessed from the perspective of the reader of the advertisement rather than the advertiser's internal financial position (at [33]-[37]).
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Loyalty rewards programme advertising that requires membership, which in turn requires opening a betting account or placing cash bets, constitutes gambling advertising and can constitute an inducement to open a betting account for the purposes of the regulation (at [48]-[53]).
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Legal advice provided by lawyers employed by a corporate subsidiary, reviewing promotional content for regulatory compliance, does not amount to "written approval for publication" by an authorised person sufficient to establish the statutory defence under subclause 12(4) of the Regulation (at [83]-[92]).
Legislation and Cases Referenced
Legislation
- Racing Administration Act 1998
- Racing Administration Regulation 2012
Cases
- R v Lavender (2005) 222 CLR 67
- Roads and Traffic Authority of New South Wales v Baldock [2007] NSWCCA 35
- Wallace v Walplan Pty Ltd (1985) 5 FCR 315
- Waugh v Kippen (1986) 160 CLR 156