Exclusion of liability: Don’t bet on it!

Exclusion of liability: Don’t bet on it!

Paddy Power consumer hits the jackpot in High Court decision

In the recent publicised case of Durber -v- PPB Entertainment Ltd ([2025] EWHC 498 (KB)) the High Court considered and commented obiter on exclusion clauses it found were unusual and onerous and had not been brought adequately to the attention of the claimant consumer, with the result that they were not incorporated into the relevant contract and therefore could not be relied on.

Monster Jackpot “win” payout refused

The claimant was a customer of Paddy Power who played an online game, “Wild Hatter”, on the company’s website. A software mapping error occurred which meant that the game initially showed she had won a “Monster Jackpot” of £1.1 million but subsequently updated to show a much lower “Daily Jackpot” of £20,000. She brought a claim for the Monster Jackpot which Paddy Power had refused to pay out.  

The key arguments

Paddy Power submitted that under the relevant terms its server records (which were determined by a random number generator) were definitive over any screen display. It also sought to rely on exclusion clauses set out in its contract terms dealing with discrepancies/errors. The exclusions in question were set out in its terms as follows:

"You fully accept and agree that random number generator (“RNG”) software will determine all outcomes of Games on the Games Website.  In the event of a discrepancy between the results displayed on your computer and a Game’s records on our server, our records shall be regarded as definitive”

(referred to as clause B1); and

"In the event of systems or communications errors relating to the generation of any result, bet settlement or any other element of a Game, we will not be liable to you as a result of any such errors and we reserve the right to void all related bets and plays on the Game in question”

(referred to as clause B2).

The claimant maintained that the (separate) game rules which said that winnings would be determined by what was on screen should take precedence over the wider terms. She also submitted that the relevant exclusions were unfair under consumer law.

High Court judgment

The High Court ruled in favour of the claimant, finding that on a proper interpretation, the game rules did take priority over the terms and did provide that the screen display would determine a player’s winnings. The court held that the exclusion clause for errors did not cover the human error in software programming that had occurred in this instance.

Notably, the court commented obiter that the exclusion clauses here were unusual and onerous and further that they were not brought adequately to the attention of the claimant.  

Even if they had been incorporated into the contract, the exclusions were deemed unfair under the Consumer Rights Act 2015, and unenforceable as a result. 

Key considerations on exclusion clauses

The judgment provides some useful reminders as regards exclusion clauses:

Bring unusual or onerous clauses to the consumer’s attention

The court noted that the words “onerous or unusual” are not terms of art but,

"are a way of putting the general proposition that reasonable steps must be taken to draw the particular term in question to the notice of those who are bound by it and that more is required in relation to certain terms than to others depending on their effect”.  

The Court referenced the familiar wording of Lord Denning in this regard:

"Some clauses which I have seen would need to be printed in red ink on the face of the document with a red hand pointing to it before the notice could be held to be sufficient”.

It stated that the more unusual, outrageous or onerous the clause is, the more necessary it is to bring it to the notice of the consumer.  

The court in this case was firmly of the view that the common intention of the parties was that what the consumer sees is what she gets, and hence the purported exclusions were onerous and unusual in context.  

The judgment expressly recorded for example here that the game rules were 1.5 pages long and noted,

"I consider a consumer would be seen as more likely to read those before playing a game than the [terms] (45 pages long with cross references to other documents)”;

and further that the rules did not even mention the terms, errors in programming or the RNG.  

The Judge concluded that Paddy Power could have made it clear to the consumer in the Rules at the date of the contract that, for instance, verification will determine the result (at least for big jackpots) but chose not to do so.  

The exclusions in question were not for example listed in the index to the terms. Nor did Paddy Power put a warning on any pre-contract screens or even in the game screen, put the clauses in a bold box, or put the text in capitals.  

The failure to bring these unusual and onerous clauses to the attention of the consumer meant they were simply not incorporated.   

Consistency in drafting: always say what you mean

The error in question here was caused by a human who mis-mapped the software which affected the “result” shown on screen. Paddy Power’s terms contained various references in different clauses to “human errors” as distinct from “system errors”. In light of this, the court arrived at the view that it was objectively intended that those words have separate meanings. It applied the contra proferentem rule to construe clause B2 in the way most favourable to the consumer, concluding that,

“if [Paddy Power] wanted to include human errors it could have said so … but it did not”.

Clause B2 was therefore construed to apply only to systems errors and not human errors and the relevant error in this case.

Establish priority

Here a preamble to clause B1 provided that the game rules prevailed over the wider terms where there was inconsistency. It pays to consider carefully any prevail or priority clauses. 

Enforceability under the Consumer Rights Act 2015: causing significant imbalance

The court noted that a term in standard terms is unfair if it causes a “significant imbalance” in the parties’ rights and obligations under the contract to the detriment of the consumer.  

The court recognised that,

"game rules and procedures setting out clearly how an online game will only be won if no error has occurred and/or requiring verification of wins, in particular large jackpots, do not inherently cause an imbalance”.

However, it went on to conclude on the facts that:

"It is the contradiction between the Rules and the Conditions which creates the imbalance. Under the Rules the player knows what is being determined and sees the outcome. Under B1 the player does not know her result and, under the second sentence of B1, her screen provides no probative evidence of the result. This combination of secret determination off screen and abolishment of the evidential probative value of the player’s screen display, put all the power into the Defendant’s hands and disempowered the player. The equivalent in live roulette, would arise where the player who bet on number 13 and sees the ball stop on the roulette wheel on number 13, is not allowed to rely on what she sees”.

The court found the exclusions unfair and unenforceable as a result.  

Conclusions

This case serves as a further reminder to contract drafters and to business relying on terms and conditions especially in a business to consumer context of the need to ensure that any potentially unusual or onerous exclusions of liability are adequately brought to the attention of the counter party. Fairness is also of course a key consideration when contracting with consumers.  

The takeaway from the case is: don’t take a gamble when it comes to excluding liability. Businesses should proactively review and refine existing terms and conditions, initial sign up/acceptance processes, and day to day user experience for repeat users for any online contracting regularly, and also consider, for example, summarising any unusual or onerous provisions in an obvious and accessible place.