Solomon v Spence - Gambling Act 2005 Interpretation

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  Solomon v Spence [2026] EWHC 645 (Ch) (20 March 2026)

URL: https://www.bailii.org/ew/cases/EWHC/Ch/2026/645.html
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[2026] EWHC 645 (Ch) | | |
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| | | Neutral Citation Number: [2026] EWHC 645 (Ch) |
| | | Claim No: BL-2024-000457 |
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
BUSINESS LIST (ChD)

| | | Royal Courts of Justice, Rolls Building
Fetter Lane, London, EC4A 1NL |
| | | 20 March 2026 |
B e f o r e :

STUART ISAACS KC
(sitting as a Deputy Judge of the High Court)

Between:
| | Alan David Solomon | Claimant |
| | - and ? | |
| | Alan Spence | Defendant |

**Mr Duncan Heath (instructed by Clarke Mairs Law Limited) appeared on behalf of the Claimant
Mr Reuben Comiskey (instructed by Child & Child Law Limited) appeared on behalf of the Defendant

Hearing dates: 2 to 5 and 11 March 2026**

HTML VERSION OF APPROVED JUDGMENT ____________________

Crown Copyright ©

3. This judgment was handed down by the judge remotely by circulation to the parties' representatives by e-mail and release to The National Archives. The date and time deemed for hand down is deemed to be 4.00pm on 20 March 2026.
6. Stuart Isaacs KC:
8. Introduction
9. This case provides a glimpse into the world of unlicensed betting. The betting in question took place between the parties on a wide range of sporting events over an extended period of time. It involved frequent deception of each other and of third parties which at the time neither party seems to have considered was either legally or even morally wrong. The case raises previously undecided questions of interpretation under the Gambling Act 2005 ("the Act") and questions of statutory and common law illegality.
12. The claimant and the defendant are retired businessmen in their late seventies. The claimant worked as a senior buyer for a supermarket chain and later owned and ran a furniture supply company. After selling that company, he retained and ran its former binding division until his retirement. He has enjoyed gambling throughout his entire adult life. The defendant, a vice-president and a member of the board of the Racehorse Owners' Association (the "ROA"), is a man of very substantial means resulting from the sale of his travel business some 20 years ago to a global travel business now known as Flight Centre. His interest in gambling, which became compulsive, sprang from his enjoyment of horseracing and his ownership of racehorses since the 1970s. Because he could afford it, he bet in large sums and, over his lifetime of gambling, has accrued losses of several million pounds.
15. The present claim arises out of debts allegedly due to the claimant from the defendant resulting from their betting activities between June 2018 and September 2022 (the "Relevant Period"). Specifically, the claim relates to four alleged debts: debts 1 and 2 referred to below arise from losing bets made by the defendant with the claimant; debts 3 and 4 referred to below are alleged to arise from bets which the claimant asked the defendant to place (or lay) with bookmakers for individuals with whom the claimant dealt and which on occasions the claimant followed (that is, added his own money to the bet).
18. The claimant has a long history of placing bets with bookmakers and betting with friends and acquaintances. During a holiday in Jersey in the 1960s, at a time when the United Kingdom government imposed a 10% betting duty, he learned from the head porter at his hotel that there was no tax on betting in Jersey. He consequently made an arrangement with the head porter for his bets to be placed by the head porter in Jersey and also placed bets in that way for a group of some five to 10 of his friends, in return for a 5% commission. He followed some of the successful bettors (known in betting circles as sharp punters) by adding his own bets to theirs. When betting duty was abolished in the UK, he continued to take bets directly from others. Sharp punters, with whom bookmakers did not want to continue to deal because of their successful betting, used him to place bets on their behalf. By opening bank accounts under pseudonyms ? thereby misleading bookmakers - and by betting in cash, he made it difficult for himself (and therefore those on whose behalf he placed bets) to be identified as persistent winners with whom bookmakers would not deal.
22. The claimant explained in his evidence that he frequently referred to his activities for others as his "business" and those others as his "clients" since they involved a lot of work and made a profit for him but that in practice he was simply placing bets with bookmakers, with the benefit of expert advice from professional tipsters. He said that, when asked what he did for a living, he would say that he placed bets for professional gamblers because he "did not feel like mentioning Office Furniture". Once access to bookmakers' odds became instantly available on the internet in around 2000, no one (apart from a Mr Tom Dry, who is referred to below) was willing to pay him a commission but his betting activities continued and he was often able to place bets on their behalf at better odds than they themselves could obtain. He became a member of several betting exchanges such as Betfair, which can be useful for laying off (or, in other words, hedging) bets. Unlike traditional bookmakers, betting exchanges do not place or accept bets themselves but allow customers to place and accept them with each other. In paragraph 32 of his first witness statement, the claimant described his activities as follows: "The bets were among a small group of people. They were all my friends, or at least social acquaintances with whom I was on friendly terms. We all shared an interest in gambling. We each put our money on the line and one of us celebrated the outcome of any given event. By the time of the events which this claim is about, this group was largely the Noble Rot group".
25. The Noble Rot is a wine bar and restaurant in the Holborn area of London which became the name of the group of individuals with an interest in gambling who met several times a year for lunch there, or elsewhere with a television when their lunches coincided with a particular sporting event. When the claimant joined the group, at the invitation of a Mr Aidan MacEchern (a financial adviser who was a long-standing friend of both the claimant and the defendant), it comprised Mr MacEchern, Mr Graham Triefus and Mr Derek Lucie-Smith, who is now deceased. Mr Martin Mitchell, Mr Nick Brookes and Mr John Livingstone-Learmonth became members of the group subsequently. The claimant first met the defendant in or around late 2016 when the defendant was invited to a lunch with the group by Mr MacEchern. The defendant met the other members of the group at the lunch and was then invited to join the group. During the course of the trial, I heard evidence not only from the parties themselves but also from Mr Mitchell, Mr Brookes, Mr Livingstone-Learmonth and Mr Triefus, with whom the defendant was already acquainted. I found the evidence of those other members of the group to have been truthful and accept it.
29. Mr Mitchell already knew the claimant. At a lunch hosted by Mr Lucie-Smith at the Sydney Arms in Chelsea on 6 October 2013, on the occasion of the Prix de l'Arc de Triomphe horserace in Paris, he and others at the table had placed some bets with the claimant. The following day, the claimant emailed Mr Mitchell with a spreadsheet of the four bets he had placed and in respect of which he owed the claimant ?360. Mr Mitchell next met the claimant some three years later when invited by Mr Triefus to attend a Noble Rot group lunch. He subsequently became a member of the group. According to his recollection, the group members only placed bets with the claimant and not with each other. He regarded the claimant as a bookmaker who, on occasions, appeared to be touting for business.
33. Mr Brookes joined the Noble Rot group after being introduced by the claimant. He placed bets with the claimant after having been recommended to him by Mr Livingstone-Learmonth as a private bookmaker but ceased doing so after there was a falling-out between Mr Livingstone-Learmonth and the claimant over a disputed bet. The stakes of Mr Brookes' bets averaged about ?1,000 per month during the national hunt season and were placed over the phone and sometimes confirmed by text messages from the claimant. He had a credit facility of ?500 to ?2,000 and received a statement about fortnightly from the claimant if he had been betting. He recalled that the claimant regularly took bets from Noble Rot group members at lunches.
36. Mr Livingstone-Learmonth is a long-standing friend of Mr Triefus and Mr MacEchern who has been keen on race-going and betting from a young age. He first met the claimant in about the early 1990s through a professional gambler friend who told him that the claimant would take bets with prices from a wider range of bookmakers that he himself had accounts with. He continued to bet with the claimant until a dispute over a winning bet between them. The claimant ended up paying him in full but not before the claimant had unfairly accused him of being a late payer and the two have not spoken since. The dispute gave rise to some bad feeling within the Noble Rot group which resulted in the claimant being asked to leave the group.
39. Mr Triefus was first introduced to the claimant in the mid-1990s. The claimant told him that he would guarantee the best odds on fixed odds bets and that, on spread betting, he would offer a more generous spread than was available elsewhere. Mr Triefus placed bets with the claimant most weeks with stakes up to about ?500 in a week for some six to eight years and the claimant provided him with fortnightly statements. He stopped betting with the claimant in the early 2000s because he valued their friendship and no longer wanted to bet with a friend and also because he became uncomfortable with the fact that sometimes the claimant would ask him to pay third parties of whom he had never heard and sometimes he would receive winnings from people whom he did not know. According to Mr Triefus, taking bets was basically the claimant's life. He was aware of many other punters in years gone by who bet with the claimant and that the claimant's activities were disapproved of by several licensed bookmakers. The members of the Noble Rot group did not bet with each other.
43. The claimant's evidence was that, over the course of their friendship, Mr MacEchern made bets with him in the ?100s but that, by the time of the Noble Rot group, ?100 would be a big bet and he later bet ?10 stakes. Mr Lucie-Smith was a successful racehorse owner and breeder with whom the claimant socialised regularly. He was a serious gambler who 10 to 20 years ago had frequently bet ?200 or more with the claimant. He ended up a net loser, gave the claimant some shares in his company which covered his losses and thereafter did not bet with the claimant. Mr Triefus is a chartered accountant who also owned racehorses. He bet with the claimant for a short time some 20 years ago but then told him that he would prefer not to bet with a friend. During the Relevant Period, Mr Livingstone-Learmonth, a wine writer, made only two bets with the claimant which gave rise to a dispute between them which Mr Livingstone-Learmonth was not prepared to compromise. The claimant ended up paying him in full and the two have not spoken since. The dispute gave rise to some bad feeling within the Noble Rot group which resulted in the claimant being asked to leave the group. Mr Brookes bet with the claimant a handful of times in the Relevant Period at stakes of some ?100s. The claimant does not recall making any bets with Mr Mitchell but says it is possible that a few bets were made between them.
46. The claimant described his betting arrangement with the defendant as follows. The defendant would send him by WhatsApp a list of events on which he wished to bet. He would then message the defendant back, quoting the best odds he could offer and the maximum stake he was prepared to accept, being typically the best or better odds than those offered by any mainstream bookmaker. The defendant almost always accepted the quote and placed the bet. From his investigations, the claimant was reassured that the defendant could afford to bet at the bigger stakes than the claimant had ever previously been asked for. However, in view of the magnitude of the bets which the defendant was seeking to place, the claimant sought guidance from a respected individual in the racing community, Andrew Riddle, who referred him to a gambler and bookmaker in South Africa, Henry Mansell. After taking their advice, the claimant placed half of the defendant's bets with them and retained the other half. The arrangement was disclosed to the defendant.
50. According to the claimant, the arrangement went well at the start but began to go awry when the defendant went on a losing streak. Because the defendant was not paying the claimant on losing bets, the claimant was unable to pay Mr Mansell. The claimant eventually settled his obligations to Mr Mansell who then dropped out of the picture, with the claimant placing the defendant's bets only with licensed outlets. The defendant continued to bet with the claimant and, when the defendant subsequently went on a winning streak, made considerably more money than he had lost, which the claimant paid, in part out of monies inherited from his mother who passed away at around that time. However, by July 2020, the defendant owed ?115,629 as the result of further losing bets ("Debt 1"). The claimant refused to extend more credit to him and the betting paused but later resumed after the defendant adhered to a schedule proposed by him under which he would pay the claimant ?5,000 twice every three months until Debt 1 was repaid in full. When the defendant occasionally wanted to place a particularly large bet, the claimant would lay it off with a betting exchange, almost exclusively Betfair.
53. The claimant's evidence was that he would email the defendant initially on a Monday and then with greater frequency with a spreadsheet of the bets made and the current balance. Each spreadsheet had an opening balance showing the state of accounts at the beginning of the day. It then listed the bets made during the course of the day and listed the outcome of those bets, if known by the end of the day. It then set out a closing balance showing the state of accounts at the end of the day. When the outcome of bets made during the course of the day was not known by the end of the day, the amount of the stake was deducted from the balance figure at the point at which the bet was made and, once the outcome was known, it was recorded for the day in which it became known. If the claimant won the bet, this was recorded as a credit in the balance column. When there was the occasional error, the defendant was astute to bring it to the claimant's attention and once corrected, the balance was agreed.
57. By October 2021, following a losing streak by the defendant, the amount shown on the spreadsheets as owing to the claimant was ?621,887 ("Debt 2"). Although the defendant put the claimant to proof of that amount, I accept the accuracy of the spreadsheets in that regard. The defendant subsequently made payments of ?87,686 and ?17,696, thereby reducing Debt 2 to ?516,515.
60. The defendant gave evidence that, during their initial lunch, the claimant told him that he was a bookmaker. The defendant took issue with the suggestion that the Noble Rot group members bet meaningfully with each other but said that he and the other members bet with the claimant at various times. For the defendant, the attraction of betting with the claimant was that, unlike traditional bookmakers who had closed his accounts for regulatory reasons because of perceived irresponsible gambling, the claimant was not under any such restraints. The defendant started betting with the claimant in or about early June 2018 largely on football rather than horseracing. His early betting was successful such that the claimant came to owe him a significant sum of money. The defendant did not keep many of the spreadsheets sent to him by the claimant, in part to conceal his gambling habit from his then wife, from whom he is now divorced. He accepted that while there are gaps in the records disclosed by the claimant, in so far as they are accurate they were a much better record of the claimant's betting through the defendant between 1 November 2021, when the claimant started placing bets through the defendant, and 2 October 2022, than the claimant's records of the defendant's betting with him. During the Relevant Period, the claimant made payments to him of ?1,228,400 and he made payments to the claimant of ?1,605,815 ? sums by which the defendant was not surprised. In December 2022, under pressure from his family, the defendant registered with Gamstop Online, an organisation which blocks people from accessing gambling websites and apps licensed in Great Britain. He has since then placed only small bets in betting shops and has had no dealings with the claimant.
63. Debts 1 and 2
64. Debts 1 and 2 arise from the direct betting between the parties referred to above. As the result of the defendant's ?5,000 payments in every two months out of three, totalling ?50,000, by August 2021 Debt 1 had been reduced to ?65,629. The balance currently alleged to be due to the claimant in respect of Debt 2 is ?516,515.
67. At this point, it is necessary to refer briefly to an argument raised by the defendant and abandoned only in his written closing submissions that his liabilities to the claimant had been compromised at, according to the defendant's oral evidence, ?175,000. The defendant maintained that position in his oral evidence, which I would not have been prepared to accept if the argument had not been abandoned and it had been necessary to decide the matter. The claimant's case was that any alleged compromise was induced by fraudulent misrepresentation on the defendant's part to the effect that his accountant had informed him that his creditors had agreed to accept 28.2p in the pound in settlement of his liabilities to them. The defendant acknowledged in his first witness statement the untruth of his statement in a WhatsApp chat on 19 November 2021 that his accountant had advised him that 28.2p in the pound was the correct figure at which to settle with his creditors: the defendant had had no such discussion with his accountant and had reached no such agreement with his creditors. He nonetheless submitted that the claimant had not been induced by the misrepresentation. In light of the evidence at the hearing, about which it is no longer necessary to make any findings, that submission was wisely not pursued.
71. Therefore, subject to the defendant's primary submission that Debts 1 and 2 are irrecoverable on the ground of illegality, in my judgment the claimant is entitled to recover the sums of ?65,629 in respect of Debt 1 and ?516,515 in respect of Debt 2. The illegality defence is considered separately below.
74. Debts 3 and 4 ? the Spreadex Agreement
75. Apart from the direct betting between the parties, according to the claimant, in or about December 2019, the defendant asked the claimant to place as many of the claimant's clients' bets with the defendant as possible in order to bolster the defendant's own turnover with his regular bookmakers and in particular on the betting platform known as Spreadex, which was important to the defendant as it sponsored some of his horses. The proposal was of mutual benefit since, for the claimant, it would involve far less work on his part. The arrangement reached (the "Spreadex Agreement", although not confined to bets on Spreadex) comprised the following: (i) the claimant would WhatsApp the defendant with the bets he wished to place, after ensuring that they complied with the so-called "two bookmaker rule" about which the defendant had informed him, namely that for Spreadex to accept bets at the best available price, the price requested for the bets had to be available with at least two major bookmakers from a restricted list of William Hill, Victor Chandler, Bet Fred, Paddy Power and Ladbrokes; (ii) the claimant would fund all stakes for the bets and ensure that the defendant was holding a ?20,000 positive balance as of the beginning of the Monday of each week, which the claimant would have to top up by the following Monday morning if the outcome of the bets placed during the course of the week was a ?10,000 loss; and (iii) the defendant would contact the Spreadex traders to confirm that he could place the bets and advise the claimant accordingly, almost always on WhatsApp. The claimant was told by the defendant that Spreadex paid out on winning bets fortnightly on Wednesdays and so, on the bottom of each spreadsheet, the claimant recorded the dates when he could expect to be paid monies owing to him.
78. According to the claimant, by reference to a list of all payments between the parties under the Spreadex Agreement of the bets which he placed prepared by his solicitors, more than 90% of them were placed for Mr Dry, a professional gambler who bet on darts and tennis events and from whom the claimant took a 1% commission on the stakes on the tennis events; a few bets were placed for a nonagenarian backgammon player called Lewis Deyong on tennis and American football; bets totalling about ?30,000 annually, of which some were placed with Spreadex, were placed for a friend of the claimant known as Bettor A, whose name emerged during the course of the trial as Mr Nigel Sealey, a professional tipster; the bulk of persistently losing bets totalling about ?150,000 were placed with Spreadex for one Thomas Bradley (known as Scottish Tommy), another nonagenarian, on Scottish football; small and persistently losing bets were placed for one Darren Easton on boxing; and, for a brief period, bets totalling about ?30,000 on horses were placed for one Scott Rivolta. The claimant also placed his own bets "mirroring" those of some of his other clients and also placed season-long bets mostly in cash based on a computer model created and updated weekly by one Justin Worrall.
81. The defendant's evidence was that, by December 2019 at the latest, the claimant asked him whether he could place bets for him. The defendant understood that he was assisting the claimant to place bets on behalf of the claimant's clients, whose names he did not know although some of the bets may have been for the claimant himself. He did not know at the time of placing any bets for the claimant that they were bets for Mr Dry or Mr Sealey. According to the defendant, the Spreadex Agreement was intended to disguise bets from sharp punters which bookmakers would not accept. The defendant said that the Spreadex Agreement was unconnected with his sponsorship deal with Spreadex. There was never any understanding that bets would be placed only through Spreadex. but, according to his first statement, the majority were.
84. However, in his second statement and in cross-examination, the defendant accepted that his previous evidence that, as far as he could recall, he did place the majority of bets with Spreadex was untrue. In cross-examination, he agreed that he had consciously decided not to place the bets on with Spreadex. The defendant put these "inaccuracies" down to having seen further documentation after making his first statement and to the personal and health problems which he was experiencing during the time he was betting with the claimant. He accepted that he was in effect himself standing (that is, accepting) the vast majority if not all of the claimant's bets and not only concealed that information from the claimant but gave the claimant the opposite and misleading impression that the bets were being placed with third-party bookmakers.
87. It follows that the defendant's evidence in his first statement that he did not stand the bets himself, giving the justification that it would have been very foolish to do so because he understood the bets to be sharp bets which would win over time and because if a bookmaker had any inkling that the bets he was placing were for other people, then that bookmaker would inevitably have refused to pay out, was also untruthful. The same is the case in relation to his evidence that the claimant was well aware that he did not accept any risk in connection with the bets placed through him and that he was really doing it for the sake of having something to do. While I accept that the defendant was experiencing personal and health problems, I do not consider those circumstances provide an adequate explanation for the untrue evidence in his first statement. The defendant's corrected evidence is consistent with the claimant's evidence that the defendant never told him that he was not in fact passing on bets to Spreadex or other bookmakers and that, had the claimant known that this was the case, he would have been able to place bets himself with other mainstream bookmakers, apart from those placed with him by Mr Dry. In his second statement, the defendant said that his suggestion throughout to the claimant that bets were indeed being placed with third-party bookmakers was untrue: he could not remember and did not know why he did not in fact place them with a third-party bookmaker prior to the summer of 2022, when he started placing them with a bookmaker called George.
90. In both his first statement and in cross-examination, the defendant gave elaborate details of his supposed relationship with a bookmaker called George. George had approached him at the Glorious Goodwood race meeting in July 2022 and wanted his business. George told him he lived in Spain but that his bookmaking business was based in Dubai. He could not recall George's family name or contact details. George mentioned that he understood that the defendant lived in Esher and that his elderly parents lived nearby and that he would be staying with them for several months. They arranged to and did meet the following Sunday at the C?te restaurant, when they agreed to meet each morning thereafter for George to accept bets which the defendant received by the defendant via WhatsApp from the claimant. They agreed that George would honour the bets and that each day the defendant would show him his phone so that George could see what bets the claimant had placed. George would honour bets notwithstanding that some of the sporting events may have finished by the time they met, because George could see the bet had been placed from the WhatsApp messages that the claimant had sent him. He would also show George the claimant's spreadsheets and they agreed that they would settle up at the end of August and then at the end of September.
93. Thereafter, according to the defendant, he and George would meet daily during August and part of September 2022, most often behind The Bear pub in Esher in the car park. George would get into the defendant's car where the defendant would show George the WhatsApp messages and the spreadsheets. George made detailed notes in his notebooks. The defendant also placed a couple of his own bets with George. After the claimant hit a big winning streak in September 2022, the claimant continued to instruct him to place bets in that way. At their daily meeting, George told the defendant in late September 2022 that he was unable to pay out in respect of the September bets. George never provided the defendant with his contact details, despite saying that he would provide them. The defendant accepted that he never told the claimant that his bets were being placed with George and that the claimant would have assumed that they were continuing to be placed with his usual bookmakers and mainly with Spreadex. Shortly after his last meeting with George, the defendant telephoned the claimant to tell him that the bookmaker he had been using was offshore and unlicensed and that he was not going to be able to pay the winnings. The defendant said that it was obvious that the claimant did not believe him at first but that, by the end of the call, the claimant appeared to have accepted his explanation as genuine.
96. In his written closing submissions, the defendant conceded that any betting through George was a breach of the Spreadex Agreement (in light of the defendant's evidence that the Spreadex Agreement allowed bets to be placed by him only with mainstream bookmakers and because George was not a licensed bookmaker). The concession was made, in my judgment, with a view to the court not making any findings about George's existence: the defendant submitted that the relevance of George fell away. However, while the issue about the terms of the Spreadex Agreement may have fallen away, the defendant's evidence about George remains relevant in the context of the common law illegality argument maintained by the defendant and (as Mr Comiskey accepted) to the issue of the defendant's credibility. The detail about George provided by the defendant is implausible and was, in my judgment, intended to lend credibility to a story which is entirely fictitious. There was no evidence as to how George knew the defendant, came to approach him at Goodwood or knew where he lived. It is improbable that the defendant would not have recalled George's full name or telephone number, particularly if, as the defendant said, George had given him a business card which he had later thrown away. There was no documentary evidence of George's acceptance of the bets or any other evidence of their meetings. In short, George did not exist and I find that the defendant's evidence about George was untruthful.
99. The claim made in respect of Debt 3 is for ?251,008 and, in respect of Debt 4, for ?8,368.25 and, in each case, in the alternative for damages in that amount for breach of the Spreadex Agreement. Although the defendant, in paragraph 24(h) of the re-amended defence, denied that Debt 3 was due, the denial was based on the nature of the agreement between the parties, as pleaded in paragraph 24(a) to (g) of the re-amended defence, and not on there being any dispute as to the quantum of Debt 3. Based on the spreadsheet at schedule 2 to the re-amended particulars of claim and the spreadsheets at pages 264 to 540 in hearing bundle D, I accept that the quantum of Debt 3 is ?251,008. In relation to Debt 4, in paragraph 25 of the re-amended defence the defendant denied liability in view of the lack of particularisation of the long-term ante-post bets said to have given rise to his liability. However, the claimant gave evidence of the quantum of Debt 4 in paragraph 142 of his first statement by reference to the documents at pages 557 to 559 in hearing bundle D, which identify the winning bets in question totalling the ?8,363.25 claimed, which I accept to be the correct quantum of that claim.
102. The claimant maintains an alternative claim for damages in deceit in the sum of ?203,335 on the basis of repeated representations by the defendant, which in cross-examination the defendant accepted to have been untrue, and which were made fraudulently, that, with respect to bets made by the claimant with him, the defendant was making corresponding bets with Spreadex or other mainstream bookmakers. The defendant also failed to advise him of any change in his intentions. The claimant submitted that the representations caused him to place himself under a contractual liability to Mr Dry since he would otherwise not have taken Mr Dry's bets or would have placed them with other bookmakers.
105. At this point, it is necessary to determine the precise nature of the Spreadex Agreement. As stated above, it was the claimant's own evidence that he was asked by the defendant to place as many of the claimant's clients' bets with the defendant as possible; and it was also the defendant's evidence that he understood that he was assisting the claimant to place bets on behalf of the claimant's clients. In cross-examination, the claimant referred to himself as "the facilitator" of bets, which he was always placing with the defendant. The claimant accepted that Mr Dry was "not personally betting" with him and that he was notifying the defendant of bets which Mr Dry wished to get on. Nevertheless, the claimant agreed that he assumed a personal responsibility to Mr Dry and guaranteed to pay Mr Dry on winning bets whatever happened.
108. The claimant submitted that the defendant was accountable in debt for both Mr Dry's winnings and his own winnings when he followed Mr Dry's successful bets or, if not for Mr Dry's winnings, at least his own. The defendant submitted that his liability, if any, was for damages and not in debt because there was no debt owed to the claimant himself. In light of the evidence referred to above, with regard to Mr Dry's winnings, I prefer the defendant's submission and, accordingly, hold that the defendant's liability, if any, sounds in damages and not debt. The evidence in question does not support the claimant's different pleaded case, in paragraph 38(i) of the re-amended particulars of claim, to the effect that the claimant was placing bets with the defendant and that the defendant would then place bets of at least identical size with Spreadex or other mainstream licensed UK bookmakers. In my judgment, the same position prevails in relation to the stakes which the claimant added to those of Mr Dry when he followed Mr Dry's bets: the claimant was thereby increasing the amount of Mr Dry's bet so as to include his own stakes. I am not satisfied that the evidence established that the claimant's following bets were separate and distinct.
111. I conclude, therefore, that the defendant's liability sounds in damages for his breaches of the Spreadex Agreement by failing to place the bets with Spreadex or any other reputable licensed bookmaker and to pay the claimant the winnings on successful bets. The quantum of the damages claimed ? to be calculated, as the defendant accepted, by reference to the winnings from the bets that had been placed as agreed - is the same amount as that of the debt claim, which was not disputed. The defendant raised the question whether the defendant had suffered any loss in circumstances where mainstream bookmakers had the ability to void bets made on behalf of third parties. However, there was no evidence to the effect that the bets in question would, on the balance of probabilities, have in fact been voided by mainstream bookmakers and therefore that question does not arise.
114. Accordingly, subject to the defendant's primary submission that no damages are recoverable in respect of the amounts of Debts 3 and 4 on the ground of illegality, the claimant is entitled to recover damages in the sums of ?251,008 (Debt 3) and ?8,368.25 (Debt 4). The illegality defence is considered separately below.
117. Consequently, it becomes unnecessary to consider the alternative claim for damages in deceit.
120. Illegality under the Act
121. The relevant provisions of the Act
122. Section 3(b) of the Act defines " gambling " to include " betting " within the meaning of section 9 of the Act. It is not in dispute that the activities with which the present case is concerned constituted " betting " and, accordingly, " gambling ".
125. Section 5(1) of the Act provides that:
128. " For the purposes of this Act a person provides facilities for gambling if he?
130. (a) invites others to gamble in accordance with arrangements made by him,
132. (b) provides, operates or administers arrangements for gambling by others, or
134. (c) participates in the operation or administration of gambling by others. "
136. Section 13 of the Act provides that:
139. "(1) In this Act "betting intermediary" means a person who provides a service designed to facilitate the making or acceptance of bets between others.
141. (2) For the purposes of this Act acting as a betting intermediary is providing facilities for betting."
143. Under section 33 of the Act:
146. " (1) A person commits an offence if he provides facilities for gambling unless ?
147. ?
148. (b) an exception provided for by any of the following provisions applies ?
149. ?
151. (v) section 296 (private gaming and betting)
153. ?
154. ?
156. (3) Subsection (1) does not apply to any activity by a person if ?
158. > (a) he acts in the course of a business carried on by a person who holds an operating licence authorising the activity, and
160. > (b) the activity is carried on in accordance with the terms and conditions of the licence. "
163. Section 296(3) of the Act provides inter alia that a person does not commit an offence under section 33 " by making or accepting a bet, or by offering to make or accept a bet, if he acts otherwise than in the course of a business ".
166. Section 335 of the Act provides that:
169. " (1) The fact that a contract relates to gambling shall not prevent its enforcement.
171. (2) Subsection (1) is without prejudice to any rule of law preventing the enforcement of a contract on the grounds of unlawfulness (other than a rule relating specifically to gambling). "
173. Was the claimant acting in the course of a business?
174. In the present case, central to the question of illegality under the Act is whether the claimant was acting otherwise than in the course of a business. If so, the exception to section 33(1) of the Act in section 296(3) of the Act will apply in the case of Debts 1 and 2 so that the claimant, if he provides facilities for gambling, will not have committed any offence under section 33(1). In the case of Debts 3 and 4, the claimant admitted that, if he was acting in the course of a business in relation to the Spreadex Agreement, he was a " betting intermediary " within the meaning of section 13 of the Act and that, if so, the section 296(3) exception was inapplicable and his activities were in breach of section 33 of the Act. However, he submitted (contrary to the defendant's submission) that a betting intermediary is not included within the section 296(3) exception to section 33 of the Act because a requirement that the betting intermediary be acting in the course of a business had to be read into section 13 and he was not acting in the course of a business.
177. The Act contains no definition of " a business " and so the parties sought to draw on authorities where the expression was considered in other contexts.
180. The claimant referred first to Graham v Green (Inspector of Taxes) [1925] 2 KB 37, which concerned an appeal by Mr Graham, whose sole means of livelihood was derived from backing horses from his residence at starting prices, against the tax authority's assessment that he was liable under Schedule D(1) of the Income Tax Act 1918 as his winnings were annual profits or gains " arising or accruing ? (ii) from any trade, profession, employment, or vocation " or " other annual profits or gains not charged under Schedule A, B, C or E and not specifically exempted from tax ". In allowing the appeal, Rowlatt J held (at page 39) that the winning of a bet did not result in a profit or gain since a bet was merely " an irrational agreement that one person should pay another something on the happening of an event "; and that, in contrast to a bookmaker, the person placing a bet, even if doing so habitually or systematically, was not engaged in a " trade, profession, employment, or vocation ". At pages 41-42, the judge said that:
183. " it has been settled that a bookmaker carries on a taxable vocation. What is the bookmaker's system? He knows that there are a great many people who are willing to back horses, and find that they will back horses with anybody who holds himself out to give reasonable odds as a bookmaker. By calculating the odds in the case of various horses over a long period of time and quoting them so that on the whole the aggregate odds, if I may use that expression, are in his favour, he makes a profit. That seems to me to be organizing an effort in the same way that a person organizes an effort if he sets out to buy himself things with a view to securing a profit by the difference in their capital value in individual cases."
185. The claimant also referred to French v The Secretary of State for Work and Pensions and Kelly Beckam [2018] EWCA Civ 470, where the Court of Appeal held, allowing an appeal against the decision of the First-tier Tribunal, that a father whose only source of income was from gambling winnings was not a self-employed earner since his activities did not constitute a business and that his gambling earnings should therefore not have been included when assessing his liability for child support. The Court of Appeal held that the First-tier Tribunal (and Upper Tribunal) had failed properly to apply its decision in Hakki v Secretary of State for Work and Pensions [2014] EWCA Civ 530.
188. At [20(iv)], Hickinbottom LJ, with whom Coulson LJ agreed, said:
191. " Such winnings are only self-employed earnings for any of these purposes where they are an adjunct to a trade or profession in which the individual is engaged, e.g. where the individual makes his winnings as a dealer at a gambling club which he owns (Burdge v Pyne), or where a poker player receives a fee for regularly appearing on television to advise the audience as to how to play poker and makes winnings from other people participating in the programme (see Hakki at [17]). But, without such an association, as a matter of law a gambler's winnings cannot amount to profits or gains arising from a trade, profession or employment, and cannot be within the scope of the self-employed earning for the purposes of the child support scheme. "
193. , Also, at [27], the judge said:
196. " Just like Mr Hakki, the Appellant is a professional gambler in the sense that he derives his entire and not inconsiderable income from gambling; but, crucially, like Mr Hakki, he does not undertake any other income-generating activity linked to that gambling which could in itself be characterised as a trade or other form of self-employment. Consistent with the well-established line of earlier revenue cases, a gambler, however sophisticated, organised or successful, as a matter of law will never, on that basis alone, be carrying out an activity amounting to self-employment. It is only when gambling is linked to some other business activity, which in and of itself amounts to self-employment, that winnings from mere gambling may fall to be assessed as part and parcel of that business, as was the case in Burdge v Pyne (see paragraphs 19 and 20(iv) above). Whether that other business activity is such as to amount to self-employment may depend upon the facts of a particular case; but, whatever the factual background, mere gambling without more can never amount to self-employment. "
198. Based on these authorities, the claimant submitted that even a gambler whose only income is his winnings is not a self-employed gambler who acts in the course of a trade or profession, regardless of the regularity or frequency of the bets, the level of his organisation, whether or not he used a betting system to try to ensure he won more that he lost, however sophisticated, organised or successful he might be.
201. The defendant argued that those cases were not in point. Whether or not an activity was carried on in the course of a business depends on context, see Town Investments v Department of the Environment [1978] AC 359 at 383B-E per Lord Diplock. French and Hakki were child support cases and, as shown by Burdge v Pyne, in some instances, winnings could be taxable.
204. The defendant submitted that greater assistance was to be derived from moneylending cases since moneylending and gambling were both carried on in the hope of making a profit. Section 6 of the Money-lenders Act 1900 defines " money-lender " to include " every person whose business is that of money-lending, or who advertises or announces himself or holds himself out in any way as carrying on the business ". In Edgelow v MacElwee [1918] 1 KB 205, at 206, McCardie J said that someone does not become a money-lender by reason of the occasional loan to relations, friends or acquaintances or merely because he may on occasions lend money to a stranger: " There must be more than occasional and disconnected loans. There must be a business of money-lending, and the word 'business' imports the notion of system, repetition, and continuity. ? The line of demarcation cannot be defined with closeness or indicated by any specific formula. Each case must depend on its own peculiar features. It is ever a question of degree. " The defendant also referred to cases involving the law relating to consumer credit and consumer protection, for example Al Tamimi v Khodari [2009] CTLT 288, Davies v Sumner [1984] 1 WLR 1301, and financial services, see Helden v Strathmore [2011] 1 BCLC 45.
207. Based on those authorities, the defendant submitted that, in determining whether the claimant was acting otherwise than in the course of a business, it was relevant to consider the regularity with which and period over which the claimant undertook his activities, whether they were undertaken with a view to profit, the value of the betting undertaken by and through the claimant, the identity of the individuals with or for whom the claimant was engaged in betting, whether the claimant was engaged in ad hoc betting or something more systematic, the degree of his record-keeping, whether security was ever offered or sought in relation to the claimant's betting, whether he held himself out as acting in the course of a business and whether he published terms on which he was prepared to carry on betting.
210. The claimant, in his oral closing submissions, sought to show that the factors identified by the defendant as relevant were not present and, in any event, submitted that they are difficult to apply in the present context of betting.
213. The decisions cited by the parties are of limited assistance. As the defendant observed, whether or not an activity is carried on in the course of a business depends on context and the context of the authorities relied on by both parties is different in each case from the context of the Act. Apart from the differences in context, in both Graham v Green and French, the appellants' betting did not involve betting by other individuals and there was no commercial element to it. There was no trade or profession in which the appellants were engaged to which their betting was an adjunct.
216. The emphasis in the Act is on the activities which may constitute the provision of facilities for gambling. There is a clear linkage between the provision of such facilities and the carrying out of a business. If facilities for gambling are provided in the course of a business, they require to be regulated, subject to the specific and limited exceptions provided for in the Act. Whether those activities take place in the course of a business must be determined broadly. I consider that the approach of McCardie J in Edgelow v MacElwee is apt by analogy: the occasional bet with friends or acquaintances does not amount to the provision of facilities for gambling, which imports the notion of system, repetition, and continuity. There is no one formula for determining whether the activities in question are carried on in the course of a business: it is " ever a question of degree ".
219. Debts 1 and 2
220. In my judgment, Debts 1 and 2 were incurred while the claimant was acting in the course of a business. The betting in question was between the parties alone but it was far from occasional and, from the claimant's viewpoint, not recreational. While the scale of the betting in question is not of itself conclusive, against the background of the other circumstances it reinforces the view that the claimant was running a business, of which only part was the betting with the defendant. The claimant had been engaged in that business since the 1970s, taking a 5% commission on bets placed in Jersey. He regularly placed bets for sharp punters. He was paid by Mr Sealey for the services he provided and there was no evidence that the payments in question related, as the claimant said, to past gambling debts. He provided details of his availability during hours of the day so that those who wished to bet would know when he was not contactable. The claimant's detailed record-keeping through spreadsheets relating to the betting of the defendant and of others is not consistent with recreational betting. Although the extent of the hedging arrangements made by the claimant is unknown, since the records of it are incomplete, it is clear that the claimant, as he himself accepted, hedged a portion of the defendant's bets with Betfair. There is reason in the documentary evidence to suppose that whatever its actual extent may have been, it took place more that "occasionally" as the claimant maintained. I do not accept the claimant's explanation that when he mentioned hedging to the defendant, he was not telling him the truth but was telling the court the truth now. In my judgment, the converse is the case. The hedging of bets is not something which would ordinarily be expected in a recreational betting setting. Also, the evidence of the other Noble Rot group members referred to above is indicative of the claimant's activities going well beyond the occasional betting with friends and acquaintances. Their and the defendant's understanding that the claimant was acting as their bookmaker is, in my judgment, correct. As the claimant accepted in cross-examination, betting at bookmakers' odds, which the claimant did, includes a margin designed to achieve a profit over time. The fact that the claimant was not operating in the same way as traditional bookmakers by making a "book" and therefore not strictly a "bookmaker" does not mean that he was not in fact operating a betting business.
223. The Spreadex Agreement
224. As far as the Spreadex Agreement is concerned, the claimant was, in my judgment, providing facilities for gambling within the meaning of section 5 of the Act in that he was thereby affording others the opportunity to bet and thus inviting them to bet in accordance with arrangements made by him with the defendant. Alternatively, the claimant was providing arrangements for gambling by others. As he now accepts, he was acting as a betting intermediary within the meaning of section 13 of the Act in that, by virtue of the Spreadex Agreement, he was providing a service designed to facilitate the making or acceptance of bets between others such as Mr Dry and Spreadex or other mainstream bookmakers or, as it turned out, between those others and the defendant; alternatively, the Spreadex Agreement constituted facilities for betting provided by the claimant.
227. In my judgment, in engaging in the Spreadex Agreement, the claimant was acting in the course of a business. The descriptions by the claimant of his earlier activities as his "business" and of those with whom he dealt as his "clients" are not conclusive but, in relation to the Spreadex Agreement, they are an accurate reflection of the true position. I also have doubts about his explanation of why, when asked early on what he did for a living, his reply was that he placed bets for professional gamblers. The claimant's description of those who bet through him by the time of the events which the present claim is concerned as being largely the Noble Rot group is incorrect in relation to the Spreadex Agreement. It is also unnecessary for the claimant to have adopted the same system as that used by bookmakers in order for him to have provided facilities for gambling in the course of a business. His activities under the Spreadex Agreement as shown by the many WhatsApp chats were commercial in nature, having particular regard to the volume of bets made by Mr Dry and the other bettors and the continuity of those bets over the period of its operation. The claimant was also intending or hoping to profit from the Spreadex Agreement not only by the commission he obtained from Mr Dry but also by the winnings he hoped to achieve by following those whom he regarded as sharp punters. In cross-examination, the claimant accepted that he was charging 1% commission to Mr Dry not just on tennis bets as he had originally said but on darts and snooker events as well. The claimant's activities went beyond acting in a private capacity.
230. The claimant divided up his activities into three categories: (i) the placing of bets for others such as Scottish Tommy in respect of whom, except in the case of Mr Dry's tennis bets where the commission taken was negligible, he took no commission; (ii) his own betting where he was following the bets of other sharp punters; and (iii) the laying of bets with relatively small stakes (until the defendant came along) for a limited number of others with whom he was on friendly terms. The defendant submitted that it made no sense artificially to divide up the claimant's activities in that way. Furthermore, the placing of bets for others was done for profit and the claimant only acquired his knowledge from sharp punters, from whom he intended to make a profit on his following bets. The laying off of bets was just as much a business as placing bets on others' behalf.
233. I agree with the defendant's submissions and consider that the claimant was acting in the course of a business in relation to all his activities.
236. It follows that, in relation to the Spreadex Agreement, the claimant is outside the exception in section 296(3) of the Act to the circumstances when an offence is committed under section 33 of the Act. Sections 296(1) and (2) are concerned with private gaming or betting (as defined as defined in Schedule 15 to the Act). They focus on situations taking place in private environments and under specific conditions. Section 296(3) of the Act expands the exception so as to cover, for example, casual and non-commercial betting between individuals outside the requirements laid down in Schedule 15 to the Act. However, for the reasons stated, it does not extend to protect the claimant in the present case. Section 13 of the Act is applicable because, even if there is a requirement that the betting intermediary be acting in the course of a business ? which it is unnecessary to decide ? the claimant was acting in the course of a business.
239. Alleged unenforceability under the Act of the contracts giving rise to Debts 1 to 4
240. The defendant submitted that, insofar as the claimant committed offences under section 33 of the Act, the contracts giving rise to the offences were void ab initio and therefore unenforceable.
243. In Gibson v TSE Malta LP (t/a Betfair) [2025] EWCA Civ 1589, the Court of Appeal stated obiter that section 33 of the Act did not have the effect that, if a gambling operator's policies and procedures were not compliant with the code of practice issued by the Gambling Commission, all the gambling contracts it entered into were illegal and void. The court upheld the trial judge's decision that section 33 did not operate to void gambling contracts in that way.
246. The defendant submitted that the obiter statement in Gibson should not be applied in the present case. The claimant submitted that it should be followed.
249. In Gibson, the Chancellor, with whom the other members of the Court of Appeal agreed, stated as follows:
252. " 54. In law, a convenient starting point on the statutory illegality of a contract is Underhill LJ's comprehensive judgment in Okedina v Chikale [2019] EWCA Civ 1393, with whom Davis LJ and Nicola Davies LJ agreed. In his judgment, Underhill LJ took into account the earlier authorities, some of which were also cited to this court, including Cornelius v Phillips [1918] AC 199, Phoenix Insurance v Halvanon Insurance [1988] 1 QB 216 and Hughes v Asset Managers plc [1995] 3 All ER 669, CA.
254. 55. The question to be answered is whether the statute intends to deprive the contract of any legal effect with the result that it is unenforceable by either party, which depends purely on construction of the statute (Okedina [17]). The prohibition may be express or implied ([18]-[19]). When the issue is whether the statute contains an implied prohibition, normal principles of statutory construction apply, albeit there are points of particular relevance. One such point (citing Phoenix Insurance in particular) is that even if one party is prohibited from entering into such a contract, it does not follow that Parliament intended to render it unenforceable by either party. Whether that was the intention must depend on a consideration of all relevant factors including matters of public policy.
256. 56. Turning to s33 itself, it was common ground that it does not contain an express prohibition which would operate to render contracts void. The issue is about what the Act implies. The judge held that s33 did not have the effect Mr Gibson contended for in [176] to [182] with the conclusion on the law at [181]. He held that the Act:
258. > > " ?does not ban gambling as an activity and cannot have been intended by Parliament to operate so as to void contracts. It simply imposes a penalty on one party. In my view, public policy overwhelmingly favours the enforceability of gambling contracts even when the operator is in breach of his licence. A successful gambler should not be deprived of the fruits of his bet, but equally in my judgment a losing gambler should not be able to escape the consequences of his decisions. [...]"
260. 57. He went on to find support for that conclusion in s336 of the Act, which includes an express power for the Commission to void an unfair bet and provides that where a bet is voided "any contact or other arrangement in relation to the bet is void". Since this only gives rise to a power to void a bet when it is unfair, that would be inconsistent with the interpretation of s33 which would void all bets if there was a breach of the LCCP. The judge also thought that Mr Gibson's interpretation of s33 would lead to chaos because every unsuccessful gambler would potentially be able to claim lost stakes back on the basis of any breach of the LCCP. Finally, in terms of public policy, considering the position of a gambler who had placed a successful bet, the judge observed that it would (at least in the common case where the provider was a counter party to the bet) be contrary to public policy if that gambler was deprived of their winnings.
262. 58. I agree with the judge, essentially for the reasons he gave. Looking at the words used in s33, they are focussed on penalties addressed to one side (the operator) rather than applying to both parties. In that sense, it is very like the situation in Phoenix concerning insurance contracts, and I refer to the points on public policy made there by Kerr LJ at 273 at A-E. The statutory prohibitions in that case (as here) were designed to protect the customer, but as Kerr LJ pointed out drawing a comparison with money lending contracts, the way the prohibitions work in policy terms depends on the context. Therefore, one can see why it would be good public policy to refuse to enforce the former (moneylending contracts) but bad policy in the case of the latter (insurance contracts). As Kerr LJ explained in the insurance context:
264. > > "? The statutory prohibitions are designed to protect the insured by seeking to ensure that undesirable persons are not authorised to carry on insurance business and that authorised insurers remain solvent. Good public policy and common sense therefore require that contracts of insurance, even if made by unauthorised insurers, should not be invalidated. To treat the contracts as prohibited would of course prevent the insured from claiming under the contract?"
266. 59. Although not exact, there is an analogy between this observation and the position of a gambler who placed a successful bet in this case. There is no policy reason why successful bets should be unenforceable (by the gambler against the operator) even if the operator is in breach of the LCCP.
268. 60. In other words, reading s33 against the scheme of the Act as a whole, it would in my judgment be a very odd conclusion that this section was intended to render all gambling contracts void if the operator was in any breach of their licensing conditions. That conclusion does not sit easily with the power of the Commission in s336. Nor does it sit well with the terms of s24(8) (above), in which the legislator positively turned their mind to the consequences of a failure to comply with the code, but did not provide for the voiding of all contracts in such circumstances.
270. 61. A submission made on Mr Gibson's behalf was that the protection of vulnerable customers was "the" priority of the Act and so this was said to support the argument about implying this effect in s33. However, while protection of the vulnerable clearly was one of the most important priorities in the Act, it was not the only one. Modernising the law was also important, as well as setting up a new regulatory scheme. Furthermore, even if protecting the vulnerable could be said to be the primary priority amongst the Act's overall purposes, that would not in my judgment go far enough to find an implied prohibition of the relevant kind in s33.
272. 62. Mr Gibson's argument is that any breach of the LCCP has the effect of rendering the contract void. That would therefore allow a losing gambler to avoid paying his gambling debts irrespective of any vulnerability and irrespective of whether the breach of the licence conditions was of any relevance to the bet in question. Such a result would be entirely contrary to the policy of the Act which, so it seems to me, is that in general gambling debts are enforceable. "
274. The defendant correctly submitted that Gibson concerned the exception provided for in section 33(1)(a) of the Act. He submitted that none of the factors in the case in respect of a person with a licence is applicable to the exception provided for in section 33(1)(b) (in particular, the section 33(1)(b)(v) exception under section 296(3)) in respect of a person who has never held a licence.
277. In my judgment, the distinction sought to be drawn by the defendant between Gibson and the present case is not well-founded and the obiter statement that section 33 did not operate in that case to render a gambling contract unenforceable is applicable to the present case. First, although the Court of Appeal was dealing with section 33(1)(a), paragraph [52] of the judgment indicates that the court's conclusion was applicable to section 33 as a whole. The section 33(2) exception is only one of the exceptions under section 33. Section 33 provides for only a single offence and does not differentiate between the various exceptions for which it provides. It would therefore be odd if a gambling contract was unenforceable in one instance but not another. Second, any implied statutory prohibition on enforcement of a gambling contract is contradicted by section 335 of the Act, which expressly provides that the fact that a contract relates to gambling shall not prevent its enforcement, without prejudice to the enforcement of the contract being prevented by inter alia the contract being illegal at common law. Similarly, in Gibson, one of the considerations which influenced the court was that section 24(8) of the Act provided inter alia that a failure to comply with a provision of a code of practice does not of itself make a person liable to civil proceedings: see at [60]. Third, the unenforceability of a gambling contract would be contrary to the public policy acknowledged in Gibson that a successful bettor should not be deprived of his winnings and to what the court described in [62] as the policy of the Act that in general gambling debts are enforceable.
280. For the above reasons, the defence of statutory illegality fails.
284. Common law illegality
285. It remains to consider the alleged illegality at common law of the contracts giving rise to Debts 1 to 4, of which the ability to rely is preserved by section 335(2) of the Act. This issue involves consideration of the Supreme Court decision in Patel v Mirza [2017] AC 467, in which the court held that a claimant who satisfies the ordinary requirements of a claim for unjust enrichment should not be debarred from enforcing his claim simply because he was seeking to recover money paid pursuant to a contract to carry out an illegal activity.
288. Lord Toulson JSC set out the principles to be applied when considered the common law doctrine of illegality as a defence to a civil claim:
291. " 120 The essential rationale of the illegality doctrine is that it would be contrary to the public interest to enforce a claim if to do so would be harmful to the integrity of the legal system (or, possibly, certain aspects of public morality, the boundaries of which have never been made entirely clear and which do not arise for consideration in this case). In assessing whether the public interest would be harmed in that way, it is necessary (a) to consider whether that purpose will be enhanced by denial of the claim, (b) to consider any other relevant public policy on which the denial of the claim may have an impact and (c) to consider whether denial of the claim would be a proportionate response to the illegality, bearing in mind that punishment is a matter for the criminal courts. Within that framework, various factors may be relevant, but it would be a mistake to suggest that the court is free to decide a case in an undisciplined way. The public interest is best served by a principled and transparent assessment of the considerations identified, rather by than the application of a formal approach capable of producing results which may appear arbitrary, unjust or disproportionate.
293. 121 A claimant, such as Mr Patel, who satisfies the ordinary requirements of a claim for unjust enrichment, should not be debarred from enforcing his claim by reason only of the fact that the money which he seeks to recover was paid for an unlawful purpose. There may be rare cases where for some particular reason the enforcement of such a claim might be regarded as undermining the integrity of the justice system, but there are no such circumstances in this case. I would dismiss the appeal."
295. The claimant additionally referred to the decisions of the Court of Appeal and the Supreme Court in Henderson v Dorset Healthcare University NHS Trust [2021] AC 563. There, the Supreme Court at [116] to [125] considered how under the " trio of considerations approach " laid down in Patel, relevant policy considerations are to be weighed. This must involve a balancing between considerations arising at stages (a) (policy reasons which support denial of the claim) and (b) (policy reasons which support denial of the illegality defence); stage (c) relates to proportionality and factors specific to the case rather than general policy considerations. Stage (b) is meant to operate " conversely " to stage (a).
298. In relation to stage (a) (whether it would be contrary to the public interest to enforce a claim if to do so would be harmful to the integrity of the legal system) it is necessary to consider whether that purpose will be enhanced by denial of the claim. The prevention of a person from profiting from his own wrong, while not the rationale of the illegality defence, is a relevant consideration linked to the need for consistency and coherence in the law and so cause damage to the integrity of the legal system (but not therefore the only one), as is enabling a person to profit from behaviour which is treated as being criminal. Great weight should be given to those factors where present. The closeness of the connection between the claim and the illegal act may also be of relevance.
301. It is only necessary to consider stage (c) (whether denial of the claim would be a proportionate response to the illegality, bearing in mind that punishment is a matter for the criminal courts), when the balancing of policy considerations comes down firmly in favour of the denial of the claim. If stage (c) is engaged, four factors are likely to be of particular relevance: the seriousness of the conduct, its centrality to the transaction, whether it was intentional and whether there was marked disparity in the parties' respective culpability. Centrality will often be a factor of particular importance.
304. Patel v Mirza was applied by the Supreme Court in Grondona v Stoffel & Co. [2021] AC 540 in the context of a claim for negligent breach of a conveyancing solicitor's retainer. The court emphasised that where stage (c) is engaged, it involves giving close scrutiny to the details of the case in hand. On the facts of Grondona, the court determined that to permit the claimant's claim to proceed would not undermine the public policies underlying the criminalisation of mortgage fraud and that, conversely, denial of the claim would run counter to other public policies. Although not strictly necessary to decide the issue. the court reached the conclusion that denial of the claim was not a proportionate response to the claimant's illegality.
307. Stage (a)
308. The defendant submitted that it would be contrary to the public interest for the claimant to be able to enforce his claims as to do so would be harmful to the integrity of the legal system. The defendant drew attention to the three objectives set out in section 1 of the Act, namely (a) preventing gambling from being a source of crime or disorder, being associated with crime or disorder or being used to support crime, (b) ensuring that gambling is conducted in a fair and open way, and (c) protecting children and other vulnerable persons from being harmed or exploited by gambling.
311. With regard to (a), he submitted that the claimant was prepared to act on behalf of individuals he had only just met or only spoken to on the telephone and took no steps to minimise the risk of crimes such as money laundering. With regard to (b), he submitted that, because of the claimant's dishonesty, he was not gambling in a fair and open way and indeed his activities were designed to hide from bookmakers the identities of sharp punters. With regard to (c), he submitted that his gambling addiction and other vulnerabilities were known to the claimant and the claimant attempted to persuade him to resume better even when he thought the defendant was insolvent.
314. The claimant submitted that it would not be contrary to the public interest to enforce his claims as to do so would not be harmful to the integrity of the legal system. In his submission: (i) the response to the claimant's conduct lay in criminal sanctions under the Act and not the unenforceability of the gambling contracts in question; (ii) the present case is fact-sensitive and does not set a precedent; (iii) any breach of section 33 of the Act has not wronged the defendant: the claimant was not cross-examined on whether a licensed bookmaker would have refused the bets and there was no cogent evidence that the claimant caused the defendant to suffer loss which would not have been suffered if the bets had been placed with any licensed bookmaker; (iv) the dishonest impression given by the claimant to the defendant, for which the claimant was unable to provide any explanation, that "Multiples Man" was a third party and not the claimant himself affected only a small part of the claim; (v) there was no medical evidence of the defendant's vulnerability; (vi) the debts were and are plainly affordable by the defendant and so the purpose of the Act is not enhanced by refusing to enforce the claims; (vii) the integrity of the court system requires that the defendant should honour his debts; and (vii) in relation to the Spreadex Agreement, no mainstream bookmaker was in fact affected because the defendant stood the bets himself.
316. Stage (b)
317. The claimant submitted that there was no other relevant public policy on which the denial of his claims might have an impact. He referred to the Court of Appeal's explanation in Gibson at [9] of the public policy behind the Act:
320. " As the judge explained at [2] and [18]/[19] of his judgment, the Gambling Act 2005 represented a watershed in gambling regulation. It was intended to recognise the economic benefits that safe gambling can bring whilst at the same time to introduce protections to safeguard vulnerable people against its dangers. The Act came after a review by the Gambling Review Body in 2001, which made various recommendations on regulation, and the Government's response to that review, in a paper called "a Safe Bet for Success", which recognised a need to modernise the law but acknowledged the need to protect children and the vulnerable from the dangers presented by gambling. "
322. He submitted that that public policy is generally best served by allowing gambling contracts to be enforced. As the Court of Appeal said in Gibson at [56], quoting the trial judge, " public policy overwhelmingly favours the enforceability of gambling contracts even when the operator is in breach of his licence. A successful gambler should not be deprived of the fruits of his bet, but equally in my judgment a losing gambler should not be able to escape the consequences of his decisions " (and see also at [58].
325. The defendant submitted that the public policy that individuals should be required to pay their debts carried little weight in circumstances where the liabilities arise only as a result of gambling which is unlawful.
328. Stage (c)
329. On proportionality, the defendant submitted that there would be nothing disproportionate "in leaving matters as they are": the claimant has received a net payment of ?377,416. If the claimant complains that he is out of pocket with respect to his third-party (professional bettor) clients, the obvious answer is that his debts are equally unenforceable.
332. The claimant submitted that it would not be a proportionate response to the illegality to render the defendant's gambling contracts illegal at common law and thus unenforceable. The defendant is a multi-millionaire who can afford to pay. It was his choice to bet with the claimant and he did so with his eyes open for his own benefit. It was the claimant who was exposed.
335. Discussion
336. Balancing the considerations arising at stages (a) and (b), I have come to the conclusion that the policy reasons which support the denial of the claimant's claims are outweighed by those which support the rejection of the common law illegality defence.
339. In terms of the policy of the Act being to prevent exploitative gambling, making due allowance for the defendant's at times compulsive gambling and his personal and health worries, I do not consider that he can properly be treated as a vulnerable person requiring protection by the claimant. There was no professional evidence of any vulnerability. The defendant is a multi-millionaire, with a responsible position in the ROA, who had the financial means to indulge his passion for owning race horses and betting on horseraces and other sporting events. He was unconcerned about the financial impact on him of his gambling losses and he could afford to gamble and lose substantial sums without his lifestyle being affected. The defendant's own evidence was that the claimant never put undue pressure on him to resume or increase his gambling. He engaged with the claimant with his eyes open, at first suspecting and then being clear that the claimant was not a licensed bookmaker. Even a licensed bookmaker would not necessarily have imposed controls on the defendant since his gambling was plainly affordable and there was no actual evidence other than from the defendant to the contrary effect or that any mainstream bookmakers did in fact do so by closing his accounts with them or otherwise, even though the defendant thought that this might have happened in the past.
342. With regard to ensuring that gambling be conducted in a fair and open way, that objective in my judgment is not of great weight in the present case. The present case is concerned with the conduct of betting between two individuals. As explained already, in their different ways neither the claimant nor the defendant acted with propriety and honesty towards each other and towards third parties but each transacted with the other knowingly and without qualms. I do not regard the deception practised by the claimant on bookmakers by the use of pseudonyms and otherwise not disclosing to third-party bookmakers that he was placing bets for sharp punters as sufficient to merit rendering his claims unenforceable.
345. Similarly, the nature of the betting about which the present case is concerned does not, in my judgment, give rise to any or any significant danger of preventing any risk of criminal or disorderly activities and certainly none which would be sufficient to merit rendering the claimant's claims unenforceable.
348. For those reasons, in my judgment, none of the matters relied on by the defendant would be harmful to the integrity of the legal system. I also accept the claimant's submission that there is no other relevant policy on which the denial of his claims might have an impact. On the contrary, it is clear from Gibson, in particular at [56] and [62], that in general gambling debts are enforceable and that a successful gambler should not be deprived of the fruits of his bet and, equally, that a losing gambler should not be able to escape the consequences of his decisions. I therefore do not accept the defendant's submission that the admitted public policy that individuals should be required to pay their gambling debts carries little weight because they only arise as the result of unlawful gambling.
351. Since the balancing of policy considerations in my judgment does not come down firmly in favour of the denial of the claimant's claims, the need to consider whether denial of the claim would be a proportionate response to the illegality does not arise. Had it arisen, I would have determined that denial of the claim would not have been a proportionate response. The sanction for the claimant's conduct lies in the offences committed under section 33 of the Act, if proved to the criminal standard of proof, and not to deny his claims against the defendant, who himself displayed dishonest conduct and who is far from blameless for the situation in which he finds himself.
354. Accordingly, the claimant is entitled to recover the amounts of Debts 1 and 2 as debts and to damages in the amounts of Debts 3 and 4. Counsel are requested to provide the court by 7 April 2026 with a draft order which reflects the terms of this judgment and which deals with any consequential matters which can be agreed. In so far as there remain matters which cannot be agreed, they can be dealt with either on paper or at a subsequent hearing.

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