Paddy Power’s high-profile loss in court should serve as a reminder to operators that terms and conditions need to align with the rest of their messaging if they are to protect themselves from errors, according to Anna Soilleux-Mills, Partner CMS.
Terms and conditions were at the heart of Paddy Power’s defence as a “mapping error” displayed that Corinne Pearl Durber had won the over £1m “monster jackpot” on the Wild Hatter Slot before paying out just £20,000.
The Flutter Entertainment subsidiary explained to Durber that the slot’s Random Number Generator (RNG) takes precedence over the jackpot displayed on screen, as per its terms and conditions.
Not satisfied, the disgruntled player took Paddy Power to court and Mr Justice Ritchie sided with the claimant, stating that the rules promoted to customers should take priority over terms and conditions.
Speaking to iGaming Daily in the aftermath of the decision, Soilleux-Mills said: “The case is a good reminder of the rules that operators need to bear in mind when trying to rely on these so-called error terms in their terms and conditions.
“This is a great illustration of all the different consumer protection rules that you need to bear in mind when operators are drafting these standard terms and conditions.”
Reflecting on the case, Soilleux-Mills noted a key contradiction between Paddy Power’s game rules and its subsequent terms and conditions, which ran to 45 pages of rules and guidelines.
The rules of Wild Hatter set out before a player begins state that the jackpot you win is determined by spinning the wheel, however, this is contradicted by the game’s rulebook, which states that the RNG’s result takes precedence over what is displayed on screen.
The “unfairness” in the contradiction between the two terms, Soilleux-Mills explained, led to the judge taking issue with the clauses and deeming they were “too broadly drafted”.
“It’s a really good illustration of why all these things are very important,” she continued. “The first issue to look at when looking at your terms and conditions is are they consistent? Are they potentially saying different things in different places?
“Then, how binding are your terms and conditions? Generally, the courts accept that click to accept is fine to create a legally binding contract. However, if there are any terms in your terms and conditions that are deemed to be onerous or unexpected for a consumer, you need to do more to bring them to a consumer’s attention in order for them to be binding.
“So you may have individual terms and conditions which aren’t legally enforceable against a consumer if they’re unexpected or onerous. Again, this was a problem in this case. And then, finally, you can have terms which aren’t fair because of the way that they’re drafted. You need to get all of that right in order for them to be enforceable.”
This is not the first time that a UK operator has been forced to pay out a seven-figure sum following a court case.
In 2021, the High Court ordered Betfred to pay out a £1.7m jackpot to Andrew Green after initially refusing his withdrawal, claiming a “defect” in the Frankie Dettori Magic Seven Blackjack meant it was paying out higher sums in winnings than intended.
This latest case will no doubt have been eyed with keen interest from the rest of the sector, however, Soilleux-Mills doesn’t believe that it will set a new precedent for terms and conditions for the industry.
Instead, it is more a case of operators reviewing and strengthening their terms and conditions and presenting them with greater clarity to consumers in a bid to avoid a similar costly mistake.
She said: This case doesn’t mean that operators are always going to have to pay out in the event of an error or that their RNG result can never take precedence.
“There are a lot of good reasons why an RNG result should take precedence.”
She added: “It means that games are paying out in accordance with their published RTP, and RNGs have to be tested.to ensure their fairness. But it just needs to be clear to a consumer because their initial expectation is going to be that what they see on screen is the right answer.
“It will be a case of the way that terms are presented, how are you highlighting those really important clauses that you want to rely on, like error clauses. You might even go as far as to flag these terms as disclaimers in the user journey. You’ve got to balance the user experience with wanting to be able to enforce these clauses.”
The outcome of the case, Soilleux-Mills added, may well have been different for Paddy Power if it had “better signposted to the consumer” its error terms prior to play.
Although Paddy Power will ultimately be responsible for paying out Durber, the financial burden may not sit completely on the shoulders of the operator.
Wild Hatter was developed by Red Tiger, and Soilleux-Mills revealed that Paddy Power “might look to recover some or ideally all” of the jackpot pay out from the developer, depending on the terms of the pay out error clause between the two entities.
As well as internal scrutiny on terms and conditions, consumer rights have also been an increasing focus for the UK Gambling Commission (UKGC) amid its implementation of widespread gambling reforms led by the UK Gambling White Paper.
Soilleux-Mills said: “For some time now, there was a competition and markets authority investigation triggered by the [UKGC] back in 2019 and the [UKGC] have said that fairness of terms and conditions will be, and continue to be, a focus for them this year.
“I think it is likely that the operators will see more scrutiny on terms and conditions from the gambling commission, not necessarily just triggered by this case, but just generally as an area of focus for the Gambling Commission.”
