Hospitality and leisure – Credit – Debts – Dishonour of cheques – Gambling

Aspinall’s Club Ltd v Fouad Al-Zayat: QBD (Comm) (Mr Justice Teare): 3 September 2008.

The claimant gaming club (C) claimed for repayment of a debt by the defendant (F). F issued a counterclaim for sums he had lost during a period when C had allegedly unlawfully provided him or allowed him to have credit.

F had provided C with a cheque for £2m in respect of money he had lost during the course of one evening while gambling at C’s club. He subsequently informed C that he believed that the gambling had not been conducted fairly, and the cheque was dishonoured on his instructions. Nevertheless, F continued to gamble at the club. Approximately 11 months after the cheque was dishonoured, F met with C and asked it to allow him one year to pay the money on the basis that, during that period, he could continue to play at the club and make repayments from his winnings. C’s director stated that he had informed F that C was prepared to allow F to make the repayments in that way. F continued to gamble at the club but failed to make repayments. F submitted that from the date that C received notification that the cheque had been dishonoured C provided, or allowed F to have, credit in respect of the £2m, contrary to section 16(1)(b) the Gaming Act 1968. F also argued that the credit unlawfully provided or allowed fell within section 16(1)(a) because the grant of the credit enabled him to purchase gaming chips, and therefore he should be granted restitution for sums lost during that credit period. C contended that its actions had amounted to forbearance from suing F, and that that could not amount to providing or allowing F credit.

Held: (1) The ordinary and natural meaning of ‘credit’ in the context of section 16 of the act was ‘time to pay’ in the sense of deferring or postponing the punter’s obligation to pay for the chips he was about to use, or had used, in gambling at the casino. Credit might be provided unilaterally in the sense that a bank might state that it would defer or postpone the obligation to pay. However, having regard to the purpose of section 16, any such unilateral provision of credit must at least be communicated to the punter. Prior to their meeting, while C had permitted F to continue to gamble, there was no evidence that C had decided to defer or postpone the time for payment of the debt in return for future payment of the debt from winnings, or that C had communicated any such election to F. However, when C had assented to F’s request to allow him one year to pay his debt out of winnings at C, C had deferred or postponed for one year F’s liability to repay the £2m of losses. That decision had been communicated to F at the meeting. That exchange, therefore, amounted to providing or allowing credit contrary to section 16(1)(b), and the claim on the cheque and the underlying loan agreement was consequently unenforceable. Thus, C’s claim was dismissed.

(2) The word ‘enabling‘ in section 16(1)(a) of the act was used in the sense of purchasing cash or tokens with which a person was able to gamble; those with which F had been able to gamble over the period of the agreement were purchased by the provision of third-party cheques endorsed in favour of C, or by means of payments by debit card. The provision of credit to pay his losses might have given F the opportunity to gamble at the club during that period in the sense that had he been sued he would not have been willing to visit it and purchase cash or chips with which to gamble. However, it did not follow that the provision of credit to pay his losses enabled him to gamble during that period. The counterclaim was, accordingly, dismissed.

Judgment for claimant in part.

Christopher Moger QC, Patrick Goodall (instructed by Beachcroft) for the claimant; David Lord (instructed by Quastel Midgen) for the defendant.