Phillip Ivey v Genting Casinos UK Ltd (t/a Crockfords Club) (2016)
A casino had been entitled to withhold a gambler's winnings on the basis that he had breached the implied term in their contract that he should not cheat. Although the gambler had believed that his technique in a card game was honest, his view of his conduct was not determinative. His conduct fell within the ordinary meaning of cheating. The court's members disagreed as to the mens rea of cheating contrary to the Gambling Act 2005 s.42.
A professional gambler appealed against a decision that the respondent casino had been entitled to refuse to pay him winnings on the basis that he had cheated.
In a card game of chance, Punto Banco, the gambler had used the technique of "edge-sorting", which relied on noting tiny differences in the cards. By claiming to be superstitious, he persuaded the croupier to use the same pack of cards and to turn "lucky" cards around, enabling him to use the technique. That increased his odds of winning. The gambler believed edge-sorting was an honest technique. Rejecting the gambler's claim for his winnings, the judge held that although the gambler had been honest, he had cheated, thus breaching the implied term against cheating in his contract with the casino.
The issues were whether dishonesty was an essential element of cheating, and whether the fact that the gambler was known to be an "advantage player" liable to use such techniques altered the view of whether his conduct amounted to cheating.
(Sharp LJ dissenting as to result, all judges differing as to reasoning)
(Per Arden LJ) There could be cheating without dishonesty. The Gambling Act 2005 s.42, which made cheating at gambling an offence, did not require dishonesty to be shown. Section 42(3) provided that cheating could consist of deception or consist of interference with the process of the game. There was no reason to mention deception if dishonesty was already required. Since s.42(3) expressly said "consist of", interference with the process could be the sum total of the facts constituting the offence. "Interference" was neutral as to mental state. A person could be liable to a criminal penalty for cheating if he deliberately interfered with the process of a game so that it was played to his or another's advantage in a way not intended by the participants. That was so even if he thought that that was a proper mode of play. Whether particular conduct was cheating was to be decided on the ordinary meaning of "cheat". There was no constraint meaning that Ghosh test dishonesty had to be shown (see paras 37-48 of judgment). The only issue was the meaning of "cheat" for the purpose of the implied term. The implied term reflected the common law rule that a contract for an unlawful act was not enforceable. Accordingly, the meaning of "cheat" had to follow s.42. A term giving wider meaning to cheating than the criminal law could not be implied. Unless there was a breach of s.42, there was no reason for the gambler to agree that his winnings should be irrecoverable (paras 58-60). There was no special meaning of cheating according to whether or not someone was an advantage player. The casino had acceded to the gambler's requests, but it had not acceded knowing that he was about to change the nature of the game by altering the odds through edge-sorting (paras 73-75). It was not necessary for the court to provide a definition of cheating covering all cases, provided it gave adequate reasons why particular facts amounted to cheating. The judge had correctly found that the gambler had cheated. Punto Banco was a game of pure chance. The gambler had caused the casino's staff to take steps that materially increased his chance of winning. He had planned to play using the knowledge of the reorienting of the cards. Those matters amounted to interference in the process. It differed from legitimate card-counting, which involved memorising where particular cards were. The casino could have taken steps to prevent the gambler's activities, but its weaknesses only gave him an advantage because of the steps he had taken (paras 80-90).
(Per Tomlinson LJ) The court should not, on the instant civil appeal, espouse a meaning of s.42 which might prove insufficiently certain in the criminal jurisdiction. The appeal could be determined without deciding the content of the criminal offence. It could not be correct to impute an intention that the agreement not to cheat extended only to a self-denying ordinance against criminal conduct. The concept of cheating long antedated s.42; the implied term must have had content independent of it. It was of the essence of Punto Banco that neither player nor croupier had an idea of the cards to be dealt; the gambler had given himself an advantage which the game precluded. The judge had erred in concluding that the gambler's conduct did not amount to a deception such as to vitiate the gaming contract. The gambler had set out to deceive. He had created an air of superstition and used it to persuade the staff to do what they would not have done had they appreciated the gambler's purpose. The gambler's view of his conduct was not determinative. He had physically interfered with the cards in a consciously deceptive manner. That was conduct falling within the ordinary meaning of cheating (paras 104-113).
(Per Sharp LJ) The mens rea of cheating contrary to s.42 was one of dishonesty. Adding the word "dishonestly" to the word "cheat" would be a solecism. The suggestion that someone could be guilty of "honest cheating" was startling and not mandated by the statutory language. The Ghosh test therefore applied. The judge had found that the gambler was honest but had cheated. He had been wrong to construe the issue of cheating in the way he had (paras 116, 128-140).
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