High Court denies applicability of an exclusion clause due to convoluted terms and conditions

Green v Petfre (Gibraltar) Ltd (t/a Betfred) [2021] EWHC 842 (QB)

The question

In what circumstances will website terms and conditions effectively exclude liability?

The key takeaway

 Those providing online services to consumers are not precluded from the possibility of excluding liability, provided that the exclusions are clearly drafted, transparent, fair and adequately signposted.

The background

Mr Green had been a Betfred customer since around 2006 or 2007. Having played Blackjack on an online platform hosted by Betfred for several hours, Mr Green’s total winnings were shown as £1,722,500.24. When he tried to withdraw them several days later, Betfred stated that due to a “glitch” (in this case, an undiscovered fault where much better odds were applied for continuous play), he could not be paid out. 

Mr Green issued a claim for his winnings by way of summary judgment, arguing that Betfred had breached its promise that customers could withdraw funds at any time from their account so long as all payments had been confirmed. In its defence, Betfred argued that the applicable contract terms excluded them from liability to pay Mr Green’s winnings in these circumstances, relying on exclusions for errors or malfunctions set out in the relevant website terms and conditions (T&Cs), the End User Licence Agreement (EULA) and the individual game rules. 

The decision

The Court granted Mr Green’s application and rejected Betfred’s submission that the case was unsuitable for summary judgment. The case involved the resolution of short points of contractual construction. English common law of contract is founded on principles of offer, acceptance, intention to create legal relations, consideration and certainty. Website contracts fall squarely within these principles. 

The Court found that the exclusion clauses that Betfred sought to rely on did not cover the circumstances of this case. Further, the clauses were opaque and difficult, making them unclear to the average and informed consumer and therefore unenforceable. In particular: 

• the relevant clauses of the T&Cs did not cover a failure to pay out winnings at all, nor did it deal with errors or glitches in the system that were undetectable to either party
• the exclusion clause contained in the EULA sought to avoid liability for obvious failures of connection but made no reference to the voiding of a bet or non-payment of winnings in these circumstances, and
• the EULA was long, complex, repetitive and obscure and had the appearance of a standard form software licence agreement (which was not a natural place to determine the rights and obligations of parties to a gaming contract). The layout and terminology used (including typographical errors and absent or inconsistent numbering) also made it unclear as to what a player was obliged to agree to, or where to find it. 

Regardless of their true meaning, none of the terms relied upon by Betfred to exclude liability were sufficiently brought to Mr Green’s attention to be incorporated into the gaming contracts he entered. Instead, the relevant clauses were buried amongst other materials, making it unlikely that Mr Green would have been able to easily spot the key terms before agreeing to them. Betfred’s failure to signpost the exclusion clauses and explain their consequences to Mr Green was inconsistent with the fairness envisaged by the Consumer Rights Act 2015.

Why is this important?

This decision reiterates the need for clear and unambiguous terms and conditions at the outset, particularly for consumer contracts. It does not preclude the possibility for online providers to exclude liability, if exclusions (and the T&Cs in general) are clearly drafted and adequately signposted. 

Any practical tips?

All online service providers should ensure their terms and conditions are clearly and carefully drafted, so that they are easy to follow, onerous provisions are highlighted/brought the counterparty’s attention, and (for consumer contracts) that they comply with applicable consumer legislation. 

There are many practical solutions, but the judge suggested that it may be prudent to include a full “click and scroll” mechanism before a website user makes a contract via the platform.