FLINDERS LAW STUDENTS’ ASSOCIATION INC.
QUESTION BANK SUBMISSION COVER SHEET
BASIC DETAILS
Name
SA Lotteries Commission of South Australia v Riley
Competition
Open Moot
Year
2011
Round
Grand Final
Author
Christopher Kwong
QUESTION DETAILS
Primary Area of Law
Contract
Judges Notes
Not provided
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IN THE FEDERAL COURT OF AUSTRALIA
No: SAD 78 of 2011
SOUTH AUSTRALIA DISTRICT REGISTRY
GENERAL DIVISION
On appeal from a Single Judge of the Federal Court of Australia
BETWEEN:
LOTTERIES COMMISSION OF SOUTH AUSTRALIA
Appellant
AND
PENELOPE RILEY
Respondent
STATEMENT OF AGREED FACTS
BACKGROUND
1
The appellant, Lotteries Commission of South Australia, operates lottery games in
South Australia pursuant to the State Lotteries Act 1966 (SA). Its trading name is SA
Lotteries.
2
The respondent, Ms Penelope Riley, claims to be entitled to prize money of $100,000.
She claims that she won this prize money through an Instant Scratchie game operated
by the appellant. The appellant denies this claim.
3
On 17 May 2010 the respondent was doing her weekly shopping at her local
supermarket in Unley Park, South Australia. As she loaded her shopping into her car
she found an Instant Scratchie ticket (‘the Scratchie’) on the ground by her driver’s
door. There was no one around to claim the Scratchie, so the respondent decided to
take the Scratchie home with her.
4
In South Australia Instant Scratchies are promoted and conducted by the appellant.
The Scratchie was a $5 Scratchie based on the game ‘Pictionary’. It consisted of nine
squares. Each square was a game. To win you had to match a word and picture within
a game. The games were concealed under a removable latex material which could be
easily scratched off to reveal the hidden word and picture in each game.
5
On the reverse side of the Scratchie there were instructions.
The instructions
relevantly provided:
PLAY INSTRUCTIONS
•
Scratch Game 1 to Game 9 to reveal a word, a picture and a PRIZE in each
Game.
•
If the word shown in any one Game matches the picture shown in the
same Game, you win the prize shown for that Game....
(emphasis added)
Below the instructions were examples of winning games and a reference to Mattel Inc
having licensed the use of ‘Pictionary’, followed by:
THIS TICKET IS GOVERNED BY THE
STATE LOTTERIES ACT 1966 (SA)
1. Prizes (maximum $1,000) are payable at any SA Lotteries Agent. 2. Other
prizes are claimable at any SA Lotteries Agent or SA Lotteries, 24-25 Greenhill
Road, Wayville SA 5034, by completing the details below (in pen in one name
only). 3. Further details as to the conduct of Instant Scratchies and Promotional
Instant Scratchies may be obtained by reading the Lotteries (Instant Scratchies)
Rules available at any SA Lotteries Agent or www.salotteries.com.au. 4. The
serial number on the front of this ticket is not part of the game. 5. You could
win up to three (3) times on this ticket. Not all tickets are winning tickets. 6.
The maximum prize of $100,000 may be available once on this ticket.
6
The applicable rules relating to Instant Scratchies, the Lotteries (Instant Scratchies)
Rules, are included in Appendix A to this Statement of Agreed Facts.
7
As soon as the respondent arrived home she decided to play the Scratchie she found.
She was immediately surprised and overjoyed to discover the word ‘POINT’ together
with a picture of a hand that appeared to be ‘pointing’ in Game 1 of the Scratchie.
She thought she had a matching word and picture and had thus won the relevant prize
of $100,000. Game 1 appeared as follows:
8
The respondent immediately went to the nearest SA Lotteries’ Agency, a newsagency,
to claim her prize. The newsagent that served the respondent, who was also the
owner of the newsagency, looked at the respondent’s Scratchie and agreed that it
appeared to be a winning ticket.
9
Following SA Lotteries’ verification process, as provided for in the Lotteries (Instant
Scratchies) Rules, the newsagent entered the serial number of the Scratchie into the
SA Lotteries’ central computer system. The Scratchie’s serial number, also referred
to as its ‘security code’, was printed at the bottom of Game 1 (as in paragraph 7
above).
This verification process is used to verify the authenticity of Instant
Scratchies and also identify whether an Instant Scratchie was a winning ticket. The
central computer system verified that the respondent’s Scratchie was authentic but
was not a prize winning ticket. The appellant therefore refused the respondent’s claim
for $100,000 in prize money (‘the prize money’).
THE PROCEEDING AT FIRST INSTANCE
10
At first instance the respondent brought a claim for breach of contract, and for
misleading and deceptive conduct under the Trade Practices Act 1974 (Cth), against
the appellant.
Breach of Contract Claim
11
The respondent claimed that there was a contract between the respondent and the
appellant, and that the instructions on the Scratchie (in paragraph 5 above) formed
part of the terms and conditions of that contract. The respondent said that the picture
of a ‘pointing hand’ matched the word ‘POINT’ as per the instructions, and she was
therefore entitled to the prize money.
12
On the other hand, the appellant first alleged that there was no contract with the
respondent. It argued this based on the fact that the respondent did not purchase the
Scratchie but merely found it. The primary judge rejected this argument.
13
Secondly, in the alternative, the appellant submitted that the word ‘DIRECT’, under
the picture of a ‘pointing hand’, was a caption and should be taken to form part of the
picture. The appellant contended that the caption therefore showed that the picture
did not match the word on the Scratchie. Therefore the respondent was not entitled to
the prize money.
14
In reply to the appellant’s alternative argument, the respondent first submitted that the
terms of the Scratchie did not provide for the incorporation of the caption in
determining whether the word matched the picture. Secondly, the respondent said
that even if the caption ‘DIRECT’ formed part of the picture on the Scratchie, the
picture still matched the word ‘POINT’ for the purposes of the Scratchie because the
dictionary meaning of ‘POINT’ includes ‘DIRECT’. The primary judge accepted the
respondent’s arguments on this point.
15
Thirdly, the appellant submitted that the State Lotteries Act 1966 (SA) and the
Lotteries (Instant Scratchies) Rules were incorporated into the terms of the Scratchie.
It contended that pursuant to section 18 of the State Lotteries Act 1966 (SA) and Rule
7.3 of the Lotteries (Instant Scratchies) Rules, it was able to rely on the fact that the
‘verification process’ (as described in paragraph 9 above) deemed the Scratchie as a
non-winning ticket and was therefore able to refuse the respondent’s claim for the
prize money. The primary judge rejected this argument.
Claims under the Trade Practices Act 1976 (Cth)
Section 52 Claim
16
The respondent alleged that the appellant engaged in conduct that was misleading or
deceptive or likely to mislead or deceive in the creation for sale, and sale of, the
Scratchie because the play instructions did not convey that its winning status:
(a) must be verified by entering its security code into SA Lotteries’ central
computer system; and/or
(b) requires that the word and picture, including the caption, must match.
17
The primary judge accepted the respondent’s claims made under the Trade Practices
Act 1974 (Cth).
18
The primary judge ordered that:
(a) the appellant pay the respondent $100,000 plus interest.
(b) the appellant pay the respondent’s costs.
GROUNDS OF APPEAL
19
The appellant now appeals the decision of the primary judge on the grounds that his
Honour erred in finding:
(a) that a contract existed between the appellant and the respondent; and
(b) that the terms of the Scratchie did not provide for the incorporation of the
caption in determining whether the word matched the picture; or
(c) in the alternative to paragraph (b), that the caption ‘DIRECT’ matched
‘POINT’ for the purposes of the Scratchie; and
(d) that the appellant could not rely on Rule 7.3 of the Lotteries (Instant
Scratchies) Rules to refuse the respondent’s claim for the prize money; and
(e) that the appellant engaged in conduct that was misleading or deceptive or
likely to mislead or deceive in the creation for sale, and sale of, the Scratchie.
JURISDICTION OF THE COURT
20
Both parties accept that matters in relation to the State Lotteries Act 1966 (SA) and
the Rules made pursuant to that Act, and the claim in contract, may be heard by the
Court. It is taken that such matters are associated with matters arising under the
Trade Practices Act 1974 (Cth) pursuant to section 32 of the Federal Court of
Australia Act 1976 (Cth).
APPENDIX A
LOTTERIES (INSTANT SCRATCHIES) RULES
STATE LOTTERIES ACT, 1966
LOTTERIES (INSTANT SCRATCHIES) RULES
1.
2.
Preliminary
1.1
These Rules may be cited as the Lotteries (Instant Scratchies) Amendment Rules,
2010 (No. 1).
1.2
The Lotteries (Instant Scratchies) Rules made under the State Lotteries Act, 1966 and
published in the Government Gazette on 19 July 1999, as amended by the amendments
published in the Government Gazette on 27 March 2003 are hereinafter referred to as
the "Principal Rules".
1.3
The Principal Rules are hereby amended effective from 16 May 2010 and these Rules
will take effect immediately thereafter, except as provided in these Rules.
Amendment of Rules
The Principal Rules are deleted and the Rules as annexed are to be substituted therefor.
The Common Seal of the Lotteries Commission of South Australia was affixed pursuant to a
resolution of the Commission in the presence of:
Dated: 13 May 2010.
(L.S.)
ANNE LINDSAY, Commission Member
SUZANNE MACKENZIE, Commission Member
Approved,
GAIL GAGO , Minister for Government Enterprises
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STATE LOTTERIES ACT 1966
LOTTERIES (INSTANT SCRATCHIES) RULES
This consolidation includes amendments as at 16 May 2010
It is provided for convenient reference only and regard should be had to the full text of the Lottery
Rules and amendments as published in the South A ustralian Government Gazette from time to
time.
ARRANGEMENT
1.
Preliminary
1.1. Citation
1.2. Commencement
1.3. Lotteries (General) Rules
1.4. Application
2.
Interpretation
2.1. Definitions
3.
General
3.1. Ticket number
3.2. Series and lots of tickets
3.3. Relevant day
4.
Security Code
4.1. Inclusion of security code
4.2. Composition of security code
4.3. Effect of security code
5.
Sale of Tickets
5.1. Notwithstanding that all prizes won
5.2. No release of information
6.
Prizes
6.1. Determined by Commission
6.2. Statement on ticket
6.3. Evaluation of prize winning ticket
6.4. Commission's discretion
7.
Prize Claims
7.1. Circumstances of claim
7.2. Requirements for lodging claim under Rule 7.1
7.3. Commission's discretion
Schedule
Date of commencement
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1.
2.
Preliminary
1. 1.
These Rules may be cited as the Lotteries (Instant Scratchies) Rules.
1.2.
These Rules will come into operation on the date specified in the Schedule to
these Rules.
1.3.
These Rules are to be read in conjunction with and are subject to the Lotteries
(General) Rules.
1.4.
These Rules apply to the lottery known as "Instant Scratchies".
Interpretation
2.1.
In these Rules and in each part of these Rules unless the contrary intention
appears:
"claim period" means the period of 12 calendar months commencing on the
relevant day. If the 12 months end on a Saturday, Sunday or public holiday, the
claim period will end at SA Lotteries' close of business on the immediately
succeeding business day;
"Instant Scratchies" means a lottery promoted and conducted by SA Lotteries in
which tickets are sealed or concealed in some way (whether by means of
removable latex material or otherwise) and the revealing of specified symbols or
the matching of symbols results in determining whether a prize has been won.
3.
4.
General
3.1.
Each ticket will be identified by a number.
3.2.
Each lottery will consist of a series of such number(s) of tickets as SA Lotteries
determines. Each series of tickets will be issued in lots of such number(s) of
tickets as SA Lotteries determines, which will constitute a separate lottery.
3.3.
For the purposes of section 16B(2)(b)(ii) of the Act, and unless SA Lotteries
determines otherwise, the relevant day for determination of the period in which
prizes may be collected will be the date on which the last ticket(s) in each lot of
tickets was or were issued by SA Lotteries to any selling point in respect of that
lottery.
Security Code
4.1.
4.2.
SA Lotteries shall include a security code on any part of a ticket for the purpose
of:
4.1.1.
verifying by the central computer system whether the ticket entitles the
bearer to a prize; or
4.1.2.
identifying counterfeit or reconstituted tickets.
A security code may be:
4.2.1.
characters, words, numerals, symbols or other markings; and
4.2.2.
printed, stamped, embossed or otherwise shown on the ticket.
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4.3.
5.
6.
7.
The security code included on a ticket is not part of a lottery or the lottery
conditions. It cannot be used to determine or enhance the value of a prize.
Sale of Tickets
5.1.
SA Lotteries may continue to distribute and sell tickets from a particular ticket
series or lot, even if any or all of the prizes for that series or lot have already been
won or claimed.
5.2.
Nothing in these Rules requires SA Lotteries to release to a person or to the
public generally information as to:
5.2.1.
whether any or all of the prizes for a particular ticket series or lot, or a
particular lottery, have been won or claimed;
5.2.2.
players who have won prizes in any lottery;
5.2.3.
the amount (if any) of the prize pool still available to be won from a
particular ticket series or lot, or a particular lottery;
5.2.4.
the date a prize is claimed; or
5.2.5.
the agency selling a prize winning ticket.
Prizes
6.1.
The prize structure will be as determined by SA Lotteries.
6.2.
A prize will be paid for a winning ticket as set out on the face of the ticket or as
otherwise determined by SA Lotteries.
6.3.
A prize will be paid on presentation of the ticket for evaluation by the selling
point terminal and the central computer system identifying it as a prize winning
ticket.
6.4.
SA Lotteries may in its absolute discretion accept or refuse to accept a prize
claim in whole or in part.
Prize Claims
7.1.
Any player who claims to be entitled to a prize but:
7.1.1.
whose ticket has not been identified by the central computer system as a
prize winning ticket;
7.1.2.
considers that their ticket has been incorrectly evaluated by
SA Lotteries; or
7.1.3.
has not obtained confirmation that the ticket has won a prize after its
evaluation by a selling point terminal
may lodge a claim with SA Lotteries.
7.2.
A claim under Rule 7.1:
7.2.1.
may be lodged with SA Lotteries either personally or by registered mail;
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7.2.2.
must reach SA Lotteries within the period specified for the
collection or taking delivery of a prize;
7.2.3.
must be accompanied by the ticket in respect of which the claim is
made, clearly endorsed with the claimant's full name and address,
and/or proof of purchase; and
7.2.4.
if posted, must be accompanied by a self-addressed envelope bearing
the correct postage.
7.3. SA Lotteries:
7.3.1.
will not be obliged to recognise any claim not identified as a prize
winning ticket by the central computer system within the period
specified for the collection or taking delivery of a prize; and
7.3.2.
may in its absolute discretion accept or refuse to accept a claim in whole
or in part.
SCHEDULE
Date of commencement of these Rules:
16 May 2010
© The Crown in right of the State of South Australia 2010
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