[1937] 1 All ER 178

Gaming - Club - Card games - Counters sold on credit to member - Winner paid by club on behalf of loser - Action by proprietor of club against loser for amounts so paid and price of counters - Gaming Act 1845 (c 109), s 18 - Gaming Act 1892 (c 9), s 1.

The plaintiff was the proprietor of a club where card games were played for money, chips or counters being used for money in the actual play. The defendant purchased from the club chips to the value of £30 for which he gave the cheque of a third party, which was subsequently dishonoured. There was a practice in the club whereby, in the event of the loser having insufficient chips to pay his losses, both winner and loser proceeded to the office of the club and the office paid the sum agreed as won direct to the winner. The office had so paid £18 19s on behalf of the defendant. In an action for £30, the price of the counters, or, alternatively, for the same sum as money lent, and for the sum of £18 19s, money lent:-

Held - (i) the giving of the counters on credit was a transaction in the nature of a promise void and unenforceable under the Gaming Act 1892, s 1, as it was a promise to pay money paid under contracts void under the Gaming Act 1845, s 18.
   (ii) the sum of £18 19s, being paid direct to the person who had already won the money upon wagers, was money lent to the defendant for the purpose of gaming or wagering and therefore irrecoverable under the Gaming Acts.
   (iii) bridge is not an unlawful game, but qu¾re whether poker is an unlawful game.

Notes
The practice of using chips or counters for money in gaming is well known. It was sought in the present case to set up the exchange of money for counters at the office of a gaming club as a sale of goods, but this contention was rejected. Such a proceeding must be treated as a loan of money for the purpose of gaming. In the second part of the case, where money was paid on the loser's behalf direct to the winner, the case of Re O'Shea, Ex p Lancaster was distinguished, since in that case the money was paid to the loser. Where it is paid to the winner, such a payment is within the Gaming Acts and irrecoverable.
   As to Loans for Gaming Purposes, see Halsbury (Hailsham Edn), Vol 15, pp 486, 487, paras 885, 886; and for Cases, see Digest, Vol 25, pp 414-416, Nos 180-192.

178

Action
Action for balance of money lent and the price of food and goods supplied by the plaintiff to the defendant, tried as a short cause under RSC Ord 14, r 8a.
   The plaintiff was the proprietor of a bridge club, of which the defendant was a member. The club was patronised by persons desirous of playing bridge or poker for money. The practice was for members to purchase chips or counters corresponding to sums of money from the proprietor of the club in exchange for their equivalent in money. These chips or counters were used as stakes in the play, and could be exchanged with the proprietor for money of a corresponding amount. The proprietor also sold food to the members and gave credit to them in various ways, particularly by advancing chips or counters to them; and this, usually, by giving chips or counters directly to the winners on behalf of the losers. At the close of play each day, the players received from the office of the club the value of the chips they returned. On 14 March 1935, the defendant obtained from the club £3 10s in cash, and chips or counters to the value of £30, and gave in return a cheque for £33 10s, drawn and indorsed by a third party. This cheque was dishonoured. At various times the plaintiff had paid on behalf of the defendant sums amounting to £18 19s under the following circumstances. In cases where a loser had insufficient chips or counters to pay his losses to the winner, both went to the office of the club and the club paid the winner and gave credit for the amount so paid to the loser. In such circumstances, such sum of £18 19s had been advanced to, or paid on behalf of, the defendant. The plaintiff claimed these various sums as money lent, and in the alternative he claimed £33 10s as damages arising out of the dishonour of the cheque, and in the alternative for goods supplied, treating the counters as goods supplied; but this view of the transaction was abandoned in the course of the argument.
   The defendant, in his affidavit in opposition to the application for summary judgment, admitted the claim for 10s 2d for food supplied, but as to the other sums pleaded that they were loans for gaming purposes, and recoverable under the Gaming Acts.
   The Gaming Act 1845, s 18, enacts as follows:

   The Gaming Act 1892, s 1, enacts as follows:

   C Doughty KC and C J A Doughty for the plaintiff: As the cheque was not indorsed by the defendant, no action lies against the defendant on the cheque; the claim is therefore for money lent or goods supplied. The games played were bridge and poker, and these are not unlawful games. Collateral transactions were therefore not vitiated. The club premises were not a gaming house so as to make all wagering thereon unlawful. Debts incurred to pay losses already incurred are recoverable. [Counsel referred to Halsbury (Hailsham Edn), Vol 15, pp 486, 487, para 886; Re O'Shea, ex p Lancaster, Tatam v Reeve, Shoolbred v Roberts, Carlton Hall Club v Laurence.]
   I Springer for the defendant: The games here played are unlawful games, and therefore the loans are irrecoverable. The club is a gaming house, and the wagers are therefore illegal. The direct payment to the loser distinguished this case from the cases where payments in respect of losses already incurred were held to be recoverable. [Counsel referred to R v OK Social & Whist Club Ltd, Jenks v Turpin, Davis v Parker.]

4 December 1936. The following judgment was delivered.

MACNAGHTEN J. In this case the plaintiff sues the defendant in order to recover £52 19s 2d, a sum made up of various items. A sum of 10s 2d for refreshments supplied is admitted. A claim for £3 10s for money alleged to have been lent in cash on 14 March 1935, has not been discussed. There is then a claim by the plaintiff for £30 as the price of counters or chips supplied on the same day. The last claim is one for £18 19s made up of various sums paid by the plaintiff to the defendant in the following circumstances. The plaintiff is the proprietor of a club, the object of which is to enable persons to play games of cards, most often bridge, but also poker, for money. The rules of the club show that it is open at various hours, mostly in the evening, but there is no evening session on Fridays. It is a rule of the club that losses incurred by one member to another shall be paid not in money, but in chips or counters, which can be bought at the office of the club for their equivalent in cash. When the players had finished their play, they went to the office and received from the office the face value of the chips or counters which they retained. Sometimes it happens that a player loses a sum in excess of the chips purchased. Strictly speaking he ought to go and buy more chips. The plaintiff says that the usual practice is for the winner and loser to go together to the office and agree the amount due to the winner, and the office pays the amount agreed to the winner. The office looks to the loser for repayment of180 the amount so paid. Amounts totalling £18 19s had thus been paid at the office by the plaintiff on behalf of the defendant.
   The sum of £30 paid on 14 March 1935, is the price of chips supplied on credit to the defendant. In respect of this sum and £3 10s, money lent, the plaintiff received a cheque of a third party for £33 10s, which was not honoured. The plaintiff is not suing on the cheque, but for £3 10s, money lent, and for £30, the price of counters and chips supplied.
   For my part, I see no answer to the claim for £3 10s, as there is nothing to show that the money was not lent to the defendant for a perfectly lawful purpose.
   As to the claim for £30 for counters sold on credit to enable the defendant to play cards for money, it is said that bridge is an unlawful game. It is certainly lawful to play bridge. In playing games of cards some skill is required. Bridge is a game of skill, but whether poker is a game of skill is more questionable. Bluff rather than skill appears to be the quality which is useful therein. The main objection raised on behalf of the defendant is that counters received on credit for the purpose of paying losses incurred in a game of bridge would be a debt which is void and unenforceable under the Gaming Act 1892, s 1. Such a transaction was in effect a promise to pay the plaintiff money paid by him in respect of contracts made void by the Gaming Act 1845, s 18. Now, in my opinion, that argument is right. Here is a man carrying on a club for the purpose of gaming or wagering at cards, and if the proprietor of such a club chooses to sell his chips on credit, or for a security which proves to be of no avail, then it seems to me that he cannot have resort to a court of law to enforce the obligation of that member. Therefore the sum of £30 for chips cannot be recovered by reason of the Gaming Acts.
   The claim for £18 19s stands in a different-position. It is said that this was lent by the plaintiff to the defendant not for the purpose of discharging gaming debts thereafter to be incurred by the defendant, but for the purpose of discharging gaming losses already incurred by him. Mr Doughty here strongly relies on the case of Re O'Shea, Ex p Lancaster as establishing the proposition that such a loan is one recoverable in law. In my view, the answer given on behalf of the defendant to that contention is effective. That case is distinguishable from the present in this way. In that case the money was paid to the person who had lost. Here it was paid to the person who had won. There is nothing in the case of Re O'Shea, Ex p Lancaster to show that, if the appellant there had paid the winner of the bets on behalf of the debtor and had then sought to recover from the debtor the amount so paid, the latter could not have successfully pleaded the Gaming Acts. That case, therefore, does not help the plaintiff, and, having chosen to pay to other persons in the club debts incurred by the defendant181 to them, he cannot now recover the amount from the defendant in a court of law. He can only rely upon the sense of honour which is said to exist among people who engage in that sort of gaming. I therefore give judgment for the plaintiff in respect of the first two items only, and he is entitled to recover the sum of £4 0s 2d. There will be no order as to costs.

Solicitors: Edgar H Hiscocks (for the plaintiff); W R Bennett & Co (for the defendant).