Lottoland (Australia) Pty Ltd v Minister for Racing, Gaming and Licensing and Another (No 2)

• Jurisdiction: Northern Territory
• Court: Supreme Court
• Judge: Southwood J
• Judgment Date: 18 August 2022
• Neutral Citation: [2022] NTSC 66
• Docket Number: FILE NO: 2020-03129-SC; 2021-00179-SC

[2022] NTSC 66

SUPREME COURT OF THE NORTHERN TERRITORY

IN THE SUPREME COURT OF THE NORTHERN TERRITORY OF AUSTRALIA AT DARWIN

JUDGMENT OF:

Southwood J

FILE NO: 2020-03129-SC; 2021-00179-SC

Between:

Lottoland (Australia) Pty Ltd

Plaintiff

and

Minister for Racing, Gaming and Licensing

First Defendant

and

Northern Territory Racing Commission

Second Defendant

REPRESENTATION:

Counsel:

Plaintiff: NC Hutley SC with him SH Hartford Davis and DJ Reynolds

First and Second Defendants: WJN Wells QC with him C Jacobi

A v Corruption and Crime Commissioner [2013] WASCA 288, Anthony Hordern and Sons Ltd and Ors v The Amalgamated Clothing and Allied Trades Union of Australia (1932) 47 CLR 1, Australian Workers' Union v Registered Organisations Commissioner (No 9) [2019] FCA 1671, Betfair Pty Ltd v Racing NSW (2012) 249 CLR 217, Cann's Pty. Ltd. v The Commonwealth (1946) 71 CLR 210, Comcare v Lilley (2013) 216 FCR 214, Ex parte Yuco Pty Ltd [1978] Qd R 235, Flanagan v Commissioner of the Australian Federal Police (1996) 60 FCR 149, Genkem Pty Ltd v Environment Protection Authority (1994) 35 NSWLR 33, Gerner v Victoria [2020] HCA 48, Hunter v The Minister for Planning [2012] WASC 247, King Gee Clothing Co. Pty. Ltd. v The Commonwealth (1945) 71 CLR 184, Lottoland Australia Pty Ltd v Australian Communications and Media Authority [2019] NSWSC 1041, Lukin Enterprises Pty Ltd v Director of Fisheries (1986) 42 SASR 463, Minister for Immigration and Multicultural and Indigenous Affairs v Nystrom (2006) 228 CLR 566, National Aboriginal and Torres Strait Islander Legal Services Secretariat Ltd v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 129 FCR 155, Northern Land Council v Quall (2020) 271 CLR 394, Pyneboard Pty Ltd and Ors v Trade Practices Commission and Anor (1982) 57 FLR 368, Rathborne v Abel (1964) 38 ALJR 293, Roads Corporation v Dacakis [1995] 2 VR 508, R v Anderson; Ex parte IPEC-Air Pty Ltd (1965) 113 CLR 177, R v Senge [2021] NTSC 80, Television Corporation Ltd v The Commonwealth (1963) 109 CLR 59, Victoria v Sportsbet Pty Ltd (2012) 207 FCR 8, referred to

Gaming and Control Act 1993 (NT) s 3

Interactive Gambling Act 2001 (Cth) s 15

Interactive Gambling Amendment (Lottery Betting) Act 2018 (Cth)

Northern Territory (Self-Government) Act 1978 (Cth) s 49

Racing and Betting Act 1983 (NT) s 3A, s 4, s 17, s 18, s 19, s 24, s 70, s 80, s 83, s 89, s 90, s 91, s 92, s 102, s 102B, s 109B, s 109C, s 109D, s 109E, s 109G, s 109H, s 148

Racing and Betting Amendment Act 2004 (NT) s 12

GAMING AND LICENSING — Jackpot betting — Whether the imposition of additional conditions on sports bookmaker licenses under s 92 of the Racing and Betting Act 1983 (NT) is ultra vires — Section 24(3) of the Racing and Betting Act 1983 (NT) implicitly grants the second defendant power to impose conditions on licences — The power conferred under s 92 of the Racing and Betting Act 1983 (NT) is not confined to the imposition of conditions relating to “the structure and assets” of the plaintiff — The additional conditions do not preclude the plaintiff from offering or accepting bets on declared sporting events including stock market indices — The additional conditions do not destroy the plaintiff's rights under the license Statutory construction — Whether the first additional condition possesses reasonable certainty of meaning and application — Meaning of “reasonable person” — Meaning of “lottery” — Meaning of “constitutes or approximates” — The second limb of the first condition ((a)(ii)) contemplates the plaintiff's state of mind — ((a)(ii)) is vague and not reasonably certain — Held ((a)(ii)) is ultra vires and invalid

GAMING AND LICENSING — Jackpot betting — Whether the first defendant's direction to the second defendant to impose additional conditions on sports bookmaker licenses is ultra vires — Section 19 of the Racing and Betting Act 1983 (NT) — Whether the first defendant's direction was made under the dictation of the Chief Minister — Whether the direction was made for the improper purpose of suppressing lawful competition — Protecting lottery operators and newsagents from competitors gaining an unfair advantage by mimicking their products is not anti-competitive — Direction valid

CONSTITUTIONAL LAW — Whether the direction contravened s 49 of the Northern Territory (Self-Government) Act 1978 (Cth) — Whether the plaintiff engaged in trade between the Northern Territory and New South Wales — Plaintiff engaged in intraterritory trade — Direction constitutionally valid

PROCEDURAL FAIRNESS — Decision maker exercising discretionary power — Whether the defendants genuinely considered the material submissions made by the plaintiff — Procedural fairness accorded

REASONS FOR JUDGMENT

(Delivered 18 August 2022)

Introduction

1 On 22 December 2015, the second defendant granted the plaintiff a sports bookmaker licence under s 90 of the Racing and Betting Act 1983 (NT). The licence permitted the plaintiff to conduct a sports bookmaker business in the Northern Territory at specified premises in Darwin. The plaintiff's original licence was to expire on 30 June 2020, and on 18 June 2020, the second defendant renewed the plaintiff's licence. The plaintiff's current licence expires in 2025.

2 Between December 2015 and September 2018, the plaintiff offered betting products to consumers that allowed bets to be placed on the outcomes of domestic and foreign lotteries. However, in 2018 the Australian Government introduced legislation 1 which prohibited betting on the outcome of a contingency that may or may not happen in the course of the conduct of a lottery, including a Keno draw. While the Commonwealth Act was enacted on 29 June 2018, its commencement was delayed for six months after assent to allow gambling operators and consumers to adjust their business and betting practices respectively. The Commonwealth Act commenced on 9 January 2019.

3 After the commencement of the Commonwealth Act, the plaintiff started marketing new products which enabled consumers to place bets on the outcome of stock market indices of another country. On 23 August 2018, the plaintiff wrote to the second defendant requesting approval of its new products. On 13 September 2018, the second defendant sent a letter to the plaintiff stating that as stock market indices were an approved sporting event under the Racing and Betting Act no further approval was required.

4 After the plaintiff started offering its new products to customers, a number of concerns were raised about the plaintiff's products by various people and

entities including: (i) Mr Chris Gibson, (ii) Senator Mitch Fifield MP, Commonwealth Minister for Communications and the Arts, (iii) a competitor, Tabcorp Holdings Limited, (iv) the Honourable Yvette D'Ath MP, the Attorney-General and Minister for Justice for Queensland, and (v) the Australian Lottery and Newsagents Association. The expression of these concerns culminated in the first defendant directing the second defendant on 29 July 2020 under s 19 of the Racing and Betting Act to impose the following conditions on all sports bookmakers and betting exchange licensees, by no later than 31 October 2020.

First

• (a) Except as set out in paragraph (b), the Sports Bookmaker and Betting Exchange Operator must not, in or through any format or media:

  • (i) describe, depict, or market its bet types in a manner that would lead a reasonable person to infer that the bet type constitutes or approximates a lottery; or

  • (ii) take any action to cause, or intended to cause, a person to believe that a bet type constitutes or approximates a lottery.

• (b) Condition (a) does not apply to:

  • (i) a ‘mystery bet’ on races or sporting matches or competitions where the combination relates to direct outcomes of identified races or sporting matches or competitions; or

  • (ii) a ‘fantasy sport’ bet where the contingencies arise from the same identified type of sporting match or competition; or

  • (iii) a description, depiction or form of marketing approved by the Commission in writing for the purpose of this licence condition.

Second

• (a) Except as set out in paragraph (b), the Sports Bookmaker and Betting Exchange Operator must not offer or accept a bet which is based on a combination of contingencies each of which form part of a sporting event or events (as defined in the Act) where:

  • (i) the selection of those contingencies:

    • (A) occurs in a way that does not allow the customer to make a specific evaluation of, or an informed decision about, the contingencies for the purpose of placing the specific bet; or

    • (B) arises from the extraction, matching or adaptation of data by the Sports Bookmaker from data sets generated by the relevant event or events; or

    • (C) involves a material element of chance or produces a jackpot; or

  • (ii) the bet relates to a proxy or surrogate for a part of the sporting event rather than relating directly to that part of the sporting event.

• (b) Condition (a) does not apply to:

  • (i) a ‘mystery bet’ on races or sporting matches or competitions where the combination relates to direct outcomes of identified races or sporting matches or competitions; or

  • (ii) a ‘fantasy sport’ bet where the contingencies arise from the same identified type of sporting match or competition; or

  • (iii) a bet type approved by the Commission in writing for the purpose of this licence condition.

5 Accordingly, on 3 August 2020, under s 92(2) of the Racing and Betting Act, the second defendant resolved to impose the two new licence conditions on all sports bookmakers and betting exchange operators licensed in the Northern Territory, and on 7 August 2020, the second defendant notified the plaintiff of the new...