Overview
The Court of Appeal has dismissed an appeal in Gibson v Betfair [2025] EWCA Civ 1589 seeking to overturn the High Court’s decision that gambling operators do not owe a general duty of care to their customers.
The Court of Appeal found that Betfair neither knew nor ought to have known that Mr Gibson was a problem gambler. Not only did Mr Gibson keep his gambling problem to himself, but he also appeared to be able to afford his gambling and assured Betfair of this on multiple occasions.
Background
Mr Gibson lost £1,480,728.84 gambling on the outcome of sporting events over a period of 10 years on the Betfair betting exchange. Mr Gibson sought to recover a significant portion of those losses from Betfair. Mr Gibson said he was a problem gambler and that Betfair had breached the terms of its licence by failing to take steps to protect him from losing money, and that this gave rise to a personal right of action in tort or contract and a right to damages. He also claimed Betfair had breached the terms of its licence and was operating unlawfully, and that each individual bet he placed during the relevant period was therefore void.
First instance decision
As to whether Mr Gibson was a problem gambler, whilst it was agreed that he suffered from a moderately severe gambling disorder, the judge did not consider that Betfair knew or ought to have known this. Not only had Mr Gibson kept his gambling problem to himself, he misled Betfair about it. Betfair had not breached its obligations under the Licence Conditions and Codes of Practice (“LCCP”) and was not required to go further than that.
In respect of the legal issues:
- Mr Gibson argued that every time he entered a betting transaction on the exchange, a new contract was made with his betting counterparty and Betfair, and each contract contained an implied term that Betfair would comply with its licence conditions. The judge disagreed and found that a contract with Betfair is formed when a customer opens an account. An implied term was not required in the contract – the contract works within the framework of the Gambling Act 2005, and the current regime does not provide direct redress to individuals against operators.
- Mr Gibson also argued that Betfair owed him a duty to take reasonable care to prevent him from suffering financial harm by the provision of gambling facilities, as he was a customer being actively managed, who Betfair knew (or ought to have known) was a problem gambler. Generally, a person does not owe a common law duty of care to prevent others suffering harm from their own actions. Based on Mr Gibson’s behaviour, the Court found that Betfair could not have been said to have assumed any responsibility, as they did not know (nor ought to have known) that Mr Gibson was a problem gambler. In addition, in applying the three-stage test established in the case of Caparo v Dickman [1990] 1 All ER 568, the Court found that the relationship between Mr Gibson and Betfair was not so proximate that it would be appropriate to impose a duty of care.
- As to illegality, the judge considered whether section 33 of the Gambling Act 2005 implies a prohibition on entering gambling contracts, other than where facilitated by a party complying in full with the terms of its licence, such that any breach of the licence in relation to a particular customer would render the contract with the customer void ab initio. The judge found that this was not the case.
You can read our earlier article in relation to the first instance decision here.
Appeal
The main question in Mr Gibson’s appeal was whether Betfair knew or ought to have known that he was a problem gambler. Permission to appeal was granted on the basis that the proposed appeal raised issues of some general importance as to the responsibilities of gambling organisations.
The Court of Appeal held that the judge at first instance made no errors of principle in considering the relevant evidence and came to an entirely reasonable conclusion on that evidence. In particular:
- Mr Gibson kept his gambling problem to himself – this was a conclusion supported by evidence (for example, Mr Rourke, who was Mr Gibson’s VIP manager at Betfair, said Mr Gibson always gave a clear impression that he enjoyed gambling and never mentioned anything remotely concerning).
- Mr Gibson could afford to fund his gambling – this was dealt with in considerable and appropriate detail in the judgment.
- Many of the interactions between Mr Gibson and Betfair over time involved AML checks, meaning he had provided detailed information about his finances and where the money he was gambling with came from.
- There was extensive evidence that Mr Gibson could afford his losses and that he presented evidence of this to Betfair. The issue was not what Mr Gibson could in fact afford, but what the information he presented to Betfair showed.
- The finding that Mr Gibson misled Betfair was clearly open to the judge. Related to it was the point that Mr Gibson repeatedly told Betfair he was comfortable with his gambling.
In light of the factual finding that there was no reason Betfair ought to have known Mr Gibson was a problem gambler, it was not necessary to decide the other grounds of appeal. However, in obiter dicta, the judge agreed that Mr Gibson’s interpretation of section 33 of the Gambling Act 2005 (i.e. that gambling contracts entered into in breach of the licensing conditions are void) would lead to chaos because every unsuccessful gambler would potentially be able to claim lost stakes back on the basis of any such breach of the LCCP. It would also be contrary to public policy to deprive a gambler who had placed a successful bet of their winnings.
Comment
The Court of Appeal’s factual finding that Betfair did not know, nor ought to have known, that Mr Gibson was a problem gambler was fatal to Mr Gibson’s challenge to the High Court’s judgment. Calvert v William Hill [2008] EWCA Civ 1427 continues to be good law: whilst gambling operators must meet their obligations under the LCCP they do not owe a general duty of care to customers.
