Just the Ticket

ON THE ISSUE OF SMALL SOCIETY LOTTERIES REGISTRATION, AND THE PROPER FORM OF LOTTERY TICKETS

I had an interesting query this week concerning the “proper” use of lottery tickets in relation to a local charity raffle. A complaint had been made concerning what someone saw as an improper use of raffle tickets for a lottery being promoted in a local supermarket and it was not clear to the parties involved and investigating whether any offence had been potentially occurring. So what is the law here?

The law surrounding local lotteries of this kind is contained in the Gambling Act 2005. The Act creates a general offence to promote a lottery (the definition of “promote” is fairly extensive, and would include, for example, selling tickets). The offence does not apply if the person promoting the lottery holds an operating licence from the Gambling Commission, or if the lottery is “exempt”.

Local charitable lotteries often conducted by community organisations or unincorporated associations are typically done via a registration with the local council. This is known as Small Society Lottery registration. Registering with the local authority allows a non-commercial organisation to conduct lotteries as long as certain rules and conditions are adhered to.

One of these conditions is about the actual tickets themselves. What constitutes a lottery ticket? Is your classic book of green, red or blue (or yellow) “cloakroom” style raffle tickets sufficient?

The condition applicable here is found under Schedule 11 Part 4 of the 2005 Act  (at Paragraph 36) and is as follows:

36(1)Where a person purchases a lottery ticket in a small society lottery he must receive a document which—

(a)identifies the promoting society,

(b)states the price of the ticket,

(c)states the name and an address of—

(i)a member of the society who is designated, by persons acting on behalf of the society, as having responsibility within the society for the promotion of the lottery, or

(ii)if there is one, the external lottery manager, and

(d)either—

(i)states the date of the draw (or each draw) in the lottery, or

(ii)enables the date of the draw (or each draw) in the lottery to be determined.

(2)For the purpose of sub-paragraph (1) a reference to a person receiving a document includes, in particular, a reference to a message being sent or displayed to him electronically in a manner which enables him to—

(a)retain the message electronically, or

(b)print it.

Note that the references here are to ensuring the person buying the ticket is given certain information. It is NOT the case that all of this information needs to be on each individual ticket, but it must reach the purchaser in the way described above.

So what if tickets are sold without this information on the face of the ticket or without a separate document making the information available?

One might argue that failure to adhere to this condition is, by a slightly circuitous route, an offence under s.258(1) (promotion of a lottery) on the basis that the lottery no longer meets the definition of “exempt” because it has not observed this condition. I note the terms of Paragraph 30 of Part 4 of Schedule 11 to the 2005 Act which says a lottery is exempt if “the other conditions of a small society lottery are satisfied”. In other words, even if registered, the lottery only remains exempt if the condition is also observed.

Technically, one could argue therefore that the use of tickets which do not conform to the above means an offence has been committed – that is, the offence under s.258(1) of the 2005 Act.

I note that there is a specific offence relating to this particular type of lottery at s.262 about a “breach of condition”, but the condition the offence relates to is not to do with the tickets but how the lottery reports itself back into the local authority. That to me suggests Parliament was of the view that this was a far more serious issue than incorrect tickets, hence providing for such a clear and specific offence.

I have not heard of a single prosecution in relation to small society lotteries where the tickets/information has not met the specific conditions above (that is not to say it has not occurred, of course). I would take the view that there is an implicit discretion here to advise the promoter of the rules to allow them to fall back into compliance rather than roll out the big guns. Whilst registered societies do of course have a legal obligation to understand and adhere to the law, I suspect many of these local community organisations are reliant on hard working volunteers who may not be entirely au fait with the foibles of Schedule 11 of the Gambling Act 2005, and perhaps some common sense can be applied. In other words, if the correct information has not been presented, advise the promoter and let them fix it.

I note that a defence is open to the person to show that he “reasonably believed” he was complying with the conditions (s.258(4)). A person selling raffle tickets in a supermarket for local charity of some sort no doubt has nothing but good intentions and not having the correct information may be oversight: perhaps the “reasonable belief” defence may apply. I doubt whether pursuit of a prosecution for a technical breach which is easily remedied is an appropriate use of police time. I would also have doubts over whether a Fiscal would consider pursuing a conviction is in the public interest in a case like this.

It seems to me that the correct response to discovering someone selling tickets which do not meet the terms above is to tell the operator and let them remedy the situation. I accept that a common sense response may be less appealing if the advice has been previously given and ignored, or if the person is knowingly and wilfully ignoring the provisions.

All of this hypothesising is based on the assumption, of course, that the person selling the tickets is doing so on behalf of a properly registered society. If there is no registration in place, then that is a clear offence under s.258 – unless another form of exempt lottery applies such as incidental non-commercial lotteries, private lotteries or customer lotteries (all blogs for another day!).

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About Stephen McGowan

Leading Scottish licensing solicitor at TLT. Chairman of BII Scotland.
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