The High Court decision against Betfred once again raises questions over the terms and conditions on gaming websites. We are all regularly asked to accept online terms, whether setting up a new online account, placing an order for goods or services, or when a supplier updates its terms and conditions. Tick the box to confirm you “agree the Terms and Conditions” – we have seen such “click wrap” terms many thousands of times.
But does anyone, other than the lawyers who drafted them, ever actually read those terms? For businesses, this poses a serious question; how can they enforce terms they know customers are unlikely to read and how do they make sure they are “fair and transparent” as required by the Consumer Rights Act 2015?
This, of course, is an issue after online casino player Andrew Green won a High Court case against Betfred’s refusal to pay him £1.7m winnings. The David slaying Goliath story is compelling. Mr Green played Blackjack on the Betfred casino. After a couple of hours' play he had won chips worth over£1.7m. He went to withdraw them and his request was declined. Eventually, Betfred told Mr Green that a glitch in the software meant Mr Green had won in error.
Betfred sought to rely on wording in several different sets of terms to limit its liability. In a summary judgement, the High Court held that Betfred could not rely on them. Betfred has said it will not appeal the decision and will now pay Mr Green his winnings, plus interest and costs.
The parts of Betfred’s terms that are quoted in the judgement are fairly typical of other click wrap T&Cs. The judgement does not break new ground, but it does give a detailed insight into how the courts will interpret online terms if they are challenged. It is fair to say the court was fairly damning of Betfred’s terms, describing them as: “iterative and repetitive”, “obscure and unclear”, “long and complex”, “singularly ineffective” and “opaque and difficult”. So what could have saved Betfred?
One of the key points in the case was whether an exclusion for a “computer malfunction” would cover an error in the software. The judgement is clear: it does not, as a user would have associated that term with a hardware error rather than a software error. Had Betfred better described what the term malfunction meant and explicitly included software errors, it would have had a better chance of it covering the liability it was seeking to exclude.
Other than some generic language at the beginning of the terms, Betfred made no attempt to bring exclusions to a user’s attention. The law has long required a party that wants to rely on “onerous or unusual” terms, such as limits or exclusions of liability, to bring it to the attention of the other party. It is not enough to include the terms in among the other terms of the agreement.
Online businesses should consider how they highlight any exclusions or limitations to users. For instance, the wording by the tick box of the click wrap terms could specifically refer to important exclusions and include hyperlinks to the specific clauses, so that users do not have to trawl through all of the terms to find the relevant clauses. Regularly reminding users of the terms will also increase the chances terms will bind them.
Finally, if an online business wants to impose exclusions or limits on their liability, they will need to consider whether the term meets the test of fairness and transparency required by the Consumer Rights Act. To quote the judgement, “the terms must be expressed fully and clearly and contain no hidden traps or pitfalls, especially clauses that may operate to the customer’s disadvantage.”
Drafting suitable clauses is not an easy task when dealing with consumers, especially when a user is unlikely to understand the underlying technology that is used to run an online platform. Careful thought is needed to make sure terms can be understood by users.
It will be interesting to see how online businesses react. Will we see a different approach to online terms emerge? There is a delicate balance to be struck between user experience and taking steps to ensure the terms will apply if they are challenged.
In light of the judgement, Betfred is likely to review its terms and how key exclusions are communicated to customers, to improve the chances it will be able to enforce them in the future. If you run an online business, you might want to do the same. Failing to do so may be a bet too far.