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ALAN C NEWHAM v DIAMOND LEISURE PTY LTD
No. AP10 of 1993
Number of pages - 25
Cheques - consideration
(1994) 4 NTLR 111
COURT
IN THE COURT OF APPEAL OF THE NORTHERN TERRITORY OF AUSTRALIA
ANGEL(1) MILDREN(2) AND PRIESTLEY(3) JJ
CWDS
Cheques - consideration
HRNG
DARWIN, 9-10 March
#DATE 5:9:1994
Counsel for appellant: B Walker SC, R Brender, J Moore
Solicitors for appellant: Barr Moore and Co
Counsel for respondent: G Hiley QC, M Spargo
Solicitors for respondent: Mildrens
ORDER
Appeal dismissed
JUDGE1
ANGEL J The facts and circumstances of this appeal and the issues argued are
set forth in the reasons for judgment of Mildren J which I have had the
advantage of reading and I will not repeat them.
2. Mildren J has set out the form of the instruments sued on by the
respondent which were signed by the appellant. As Mildren J has related, the
appellant contends, for reasons raised for the first time on appeal, that the
completed instruments were not cheques as defined in the Cheques and Payments
Orders Act, 1986 (Cwlth), the relevant provisions of which Mildren J has set
forth. I agree that the instruments are clearly addressed to the Commonwealth
bank and that in that respect they comply with s10(1)(a) and s13 of the
Cheques and Payments Orders Act, 1986.
3. The appellant's other contention was that because the instruments used the
word "payable" rather than the word "pay" they did not amount to an order or
direction to the Bank to pay. It was said that the word "payable" is not the
imperative of the verb "to pay", and that therefore the instruments could not
be said to be unconditional orders in writing for the purposes of s10.
4. I am of the view that this argument should be rejected.
5. The word "payable" means, inter alia, "that must be paid, due" (Concise
Oxford Dictionary), "that is to be paid, due, owing" (OED), "that should be
paid" (Chambers Dictionary), "to be paid, due" (Macquarie Dictionary). Thus in
the context of these instruments the words "payable to" mean "that is to be
paid to" or "to be paid to". The word "payable" in each instrument is an
adjective - made from adding the living suffix "able" to the transitive verb
"pay" - which qualifies the denoted monetary sum. Addressed as they are to
the Bank, the instruments are to be construed as referring not to a sum
payable by the appellant drawer but by the Bank to which they are addressed.
Thus construed, ("payable to" meaning "to be paid by you to") each completed
instrument is a direction to the Bank to pay the denoted sum i.e. it is
imperative and more than a mere authorisation or request to pay. It is
therefore an order for the purposes of s10 of the Act.
6. It may be true that other possible meanings are capable of being
attributed to the word "payable" in the instruments. It may be construed in
the sense of payable by the appellant drawer, ie no more than an
acknowledgment of debt. Alternatively the word "payable" might be considered
as having an alternative dictionary meaning, namely, "that can or may be paid"
ie, as meaning that payment is optional rather than mandatory; but it is to be
noticed that the Oxford English Dictionary describes such usage as rare.
However I do not so read the instruments. Nor do I think they can properly be
so read.
7. If there is any ambiguity in the matter (a view not shared by the
appellant's Bank) the words of Barwick CJ in Upper Hunter County Districts
Council v Australian Chilling and Freezing Co Ltd (1968) 118 CLR 429 at 436-7
are to be remembered - each instrument is capable of meaning and bears that
meaning which the Court decides in its proper construction. In my opinion the
instruments are a direction to the Bank to which they are addressed to pay the
respondent the denoted sums upon due presentation of the instruments and that
they are cheques as defined by s10 of the Act.
8. At the time of dishonour the appellant had received value for the cheques
- he had received the "Cheque Credit Facility" forms; he had received the
respondent's promise to give him chips in exchange therefor; he had received
the respondent's promise to permit him to play lawful games at the
respondent's casino; he had received the chips.
9. Discrete lawful value having been received, and, or alternatively,
discrete lawful valuable consideration sufficient to support a simple contract
(cf Chappell and Co Ltd v Nestle Co Ltd (1960) AC 87) having been given for
the cheques (ss 35, 36 Act), and the cheques having been dishonoured on due
presentation, the appellant is liable on them; (ss 70, 71, 76 Act).
10. On the question of interest, I generally agree with Mildren J. I agree
that the learned trial judge's discretion miscarried and that allowance should
be made for the drop in interest rates since the date of dishonour.
11. In the circumstances, in lieu of the order of the learned trial Judge, I
would order that the appellant pay the respondent interest at the rate
prescribed by the regulations at the time of dishonour, viz. 16.965% from the
date of dishonour until payment and further order that so much of that
interest as exceeds the rate from time to time ruling by virtue of the
regulations be withheld.
12. Otherwise I would dismiss the appeal.
13. The interest point occupying very little time on the hearing of the
appeal, I would order the appellant to pay the respondent's costs of the
appeal.
14. The appeal should be dismissed with costs.
JUDGE2
MILDREN J Between 3 and 8 August 1989, the appellant, his wife and
sister-in-law came to Darwin as guests of the respondent for the Darwin Cup
Carnival. The respondent paid for the appellant's and his family's first
class return airfares and provided free accommodation, food, drinks and other
services. The appellant had previously visited Darwin as a guest of the
respondent on a similar basis.
2. At all material times, the respondent was the holder of a gambling casino
licence pursuant to the provisions of the Casino Licensing and Control Act
1984, which permitted it, subject to the conditions of the licence, to
organise and play certain authorised games. It will be necessary to discuss
the terms of the respondent's licence and the legislative scheme which applied
to the respondent's casino more fully later.
3. During the period of his stay in Darwin, the appellant played blackjack
and baccarat at the respondent's casino. He ended up, in effect, with a loss
of $620,000. However, the appellant had not given cash to the respondent in
order to acquire the chips with which he needed to gamble. What he did was to
sign a number of instruments, totalling in all $620,000, which the respondent
claims were, or became, cheques within the meaning of the Cheques and Payment
Orders Act 1986 (Commonwealth), in return for which he acquired cheque credit
slips which he used to obtain chips to the same face value. The appellant
stopped payment on these instruments when they were presented by the
respondent to the appellant's bank. The respondent sued on these instruments
as dishonoured cheques or alternatively promissory notes;
alternatively the respondent claimed (a) restitution of the sum of $620,000 on
the basis that the appellant had been unjustly enriched or (b), the sum of
$620,000 for goods sold and delivered, viz. the chips. The appellant raised a
number of defences to the action. He denied that the chips were sold to him;
he claimed that the instruments were never cheques or promissory notes; he
claimed that the whole transaction leading to the grant of the instruments was
tainted with illegality and that the respondent's causes of action were
therefore unenforceable; and he also claimed that the actions were
unenforceable because of the provisions of s12(5) of the Casino Licensing and
Control Act, 1984, inter alia because the respondent lent the appellant
$620,000 for the purposes of gambling. The respondent by its reply maintained
that the appellant was estopped from denying that the instruments were
cheques, and was estopped from asserting that the respondent lent the
appellant the sum of $620,000.
4. The learned trial judge, Thomas J, held that the instruments were cheques,
that all of the defences raised by the appellant failed, and accordingly, she
entered judgment for the sum of $620,000 in favour of the respondent. Thomas
J did not find it necessary to consider the alternative claim based on unjust
enrichment. At a later time, Thomas J further awarded damages to the
respondent in the amount of interest fixed by s76(1)(a)(ii) of the Cheques and
Payment Orders Act 1986 and regulation 4 of the Cheques and Payment Orders
Regulations.
5. The appellant appeals to this court both in respect of his liability to
the respondent and in respect of the quantum of interest and damages awarded.
The respondent has delivered a notice of contention, on two minor issues
neither of which were pursued at the hearing of this appeal. It is important
to note that the notice of contention does not raise for this court's
consideration any alternative basis upon which the judgment might be supported
if the instruments were not cheques. In these circumstances, the appellant
contended that if it is successful in persuading this Court that the
instruments were not cheques or promissory notes, or, that if they were, and
the appeal should be allowed on any other ground argued, the action should be
remitted to Her Honour to enable formal findings to be made on the question of
estoppel, and also on the cause of action based on unjust enrichment. At the
hearing of the appeal, this Court indicated that it accepted that submission,
and did not require Mr Walker SC, who appeared for the appellant, to develop
that submission further.
Were the instruments cheques?
6. Thomas J found that, during the relevant period, the appellant signed a
number of instruments which he delivered to the respondent. These
instruments, when delivered, were each in the form (of which instrument 6803
is an example) set out below:
6/8/1989
BANK
BRANCH
ACCOUNT No.
Payable to DIAMOND LEISURE PTY LIMITED
AMOUNT IN WORDS THIRTY THOUSAND DOLLARS
$30,000---
A. NEWHAM A. NEWHAM
(Signed
PRINTED NAME SIGNATURE
6803 CAS 410
7. Once these instruments, or `house cheques' as they were called, were
delivered to the respondent, the respondent gave to the appellant cheque
credit slips to the same value. For example, in relation to instrument 6803,
the appellant gave the respondent four cheque credit slips, two for $10,000
and two for $5000. An example of one of these slips is set out below:
DIAMOND BEACH CASINO
N.T.R.G.C.
CHEQUE CREDIT
(STAMPED) $5,000and00cts
ISSUED: 6/8/89 10.45PM
33849
NAME A NEWHAM
AMOUNT IN WORDS FIVE THOUSAND DOLLARS
$ 5000 ---
CASHIER D2277
INSPECTOR (Signed) 0190
DEALER (Signed) 2413
PIT BOSS (Signed)
THIS VOUCHER IS VALID FOR CHIPS AT THE GAMING TABLES ONLY AND SHOULD
BE EXCHANGED ON DAY OF ISSUE.
TABLE B3 16
CHQ
T/CQ
F/c
29-57 Government Printer of the Northern Territory
8. The appellant then exchanged at one of the gaming tables each cheque
credit slip for an equivalent face value in chips.
9. Thomas J found that the appellant and the respondent entered into a cheque
cashing contract, which contained a term that each 'house cheque' could be
redeemed by the appellant within 14 days of the transaction, at the end of
which time the respondent was authorised to complete these instruments as
cheques and, if not redeemed, would present them for payment. It was an
agreed fact that the instruments were completed on 30 August 1989 by a member
of the respondent's staff. For example, instrument No. 6803 when completed,
is set out below:
XXXX
6/8/1989
BANK COMMONWEALTH BANK
BRANCH CIRCULAR QUAY 062 004
ACCOUNT No. 400 123
Payable to DIAMOND LEISURE PTY LIMITED
AMOUNT IN WORDS THIRTY THOUSAND DOLLARS
$30,000---
A. NEWHAM (Signed A. NEWHAM)
PRINTED NAME
0003000000
6803 062 004 400 123 CAS410
10. Thomas J found that on 31 August 1989 the appellant signed a direction to
his bank to stop payment of the 'cheques'; that the 'cheques' were presented
for payment and subsequently dishonoured. Thomas J also found that the
instruments, when completed, were cheques within the meaning of the Cheques
and Payment Orders Act 1986 and that, up until 31 August 1989, the appellant
intended to honour them.
11. The appellant contends that the instruments, when completed, were not
cheques for two reasons: (a) because they did not name the drawee bank on
their face, and (b) because they were not unconditional orders requiring a
bank to pay on demand. I should add that the appellant did not contend that
the respondent was not authorised to complete the instruments from their
inchoate state, nor did the appellant contend that the appellant had revoked
the respondent's authority to do so at any relevant time.
12. The Cheques and Payments Orders Act 1986, provides:
Cheque defined
10.(1) A cheque is an unconditional order in writing
that:
(a) is addressed by a person to another person (being a
bank);
(b) is signed by the person giving it; and
(c) requires the bank to pay on demand a sum certain in
money.
(2) An instrument that does not comply with subsection
(1), or that orders any act to be done in addition to
the payment of money, is not a cheque.
Order to pay
11. An order to pay must be more than an authorisation
or request to pay.
Unconditional order to pay
12.(1) An order to pay on a contingency is not an
unconditional order to pay and the happening of the
event does not make the order an unconditional order to
pay.
(2) An order to pay shall not be taken not to be an
unconditional order to pay by reason only that the order
is coupled with either or both of the following:
(a) an indication of a particular account to be debited
by the bank to which the order is addressed;
(b) a statement of the transaction giving rise to the
order.
Order addressed to a bank
13.(1) An order to pay is not addressed to a bank
unless:
(a) the order is addressed to a bank and to no other
person;
(b) the order is addressed to one bank only; and
(c) the bank is named, or otherwise indicated with
reasonable certainty, in the instrument containing the
order.
(2) An order to pay may be an order to pay addressed to
a bank notwithstanding that a person other than the bank
on which the instrument containing the order is drawn,
the payee or the drawer is specified in the instrument.
13. The appellant's first contention may be shortly disposed of. The
instrument, in my opinion, is clearly addressed to the Commonwealth Bank. It
is true that words on the instrument do not include the word "to" immediately
before the word "bank", but in my opinion, that does not matter. It is common
knowledge that printed cheque forms provided by Australian banks contain no
more than the name of the bank to whom a cheque is intended to be addressed.
I have no doubt that the instruments complied with s.10(1)(a) and s.13 of the
Cheques and Payments Orders Act, 1986.
14. The appellant's second contention was that because the instruments used
the expression "payable to Diamond Leisure Pty. Limited" rather than "pay to
....", there was no order to pay within the meaning of the Act. This point was
not argued before Thomas J, but the question being a pure question of law I
think that it is proper that we should deal with it. It was submitted that the
word "payable" describes a characteristic or potential of the particular sum,
rather than unequivocally conveying a command to the bank to pay. Mr Walker
submitted that the use of the word "payable" characterised these instruments
as IOUs, or alternatively, as promissory notes. The only case Mr Walker was
able to find touching upon the topic was an obiter dictum of Nelson J in the
Supreme Court of New York, in Kimball v Huntingdon (1833) 10 Wendall's Reports
675; 25 American Decisions 590, to the effect that an instrument which read
'Due Kimball and Kinnerston, $325 payable on demand' was a promissory note.
Mr Walker frankly conceded that this case was of no assistance, and I agree
with him. Clearly the circumstances of the instrument in that case are
distinguishable from the present case.
15. The Cheques and Payments Orders Act 1986 does not specifically require
the use of the word 'pay'. No particular form of words is required so long as
it is an order to pay; and is something more than an authorisation or request
to pay. As a matter of English grammar, 'pay' or 'pay to' is the imperative
of the verb 'to pay' whilst 'payable to' is not imperative in form. In Glass
v Defence Force Retirement and Death Benefits Authority (1992) 38 FCR 534, at
537, the Full Court of the Federal Court of Australia held that, the word
'payable' is an ordinary English word signifying that something is capable of
being paid. Thus, it might be thought that 'payable to' is a mere
authorisation to pay. In Glass' case, the Full Court held that the word
'payable' as used in the context of an Act did not indicate a discretion to
pay. At p538, their Honours said:
"The appellant did not deny that the ordinary English
meaning of "payable" is "capable of being paid" as
indicated by a number of general and legal dictionaries.
Nevertheless, he went on to submit that "capable" in
that definition implies only a discretionary power or
capacity to act. However, the epithet "payable" is
attached as a matter of ordinary usage to an inanimate
object, as it is in this legislation to a "lump sum" and
a "transfer value". Used in that way, it imports no
discretion or choice in the presumptive payer whether or
not to make the payment. Any discretion is only as to
whether or not to require payment and resides solely in
the presumptive payee."
16. All this case demonstrates is that 'payable' may, in context, amount to
more than an authority or request, both of which confer a discretion on the
part of the payer.
17. There is remarkably little authority which discusses the circumstances
under which words used have been construed to be unconditional orders, as
opposed to an authorisation or request. We were referred to a few ancient
authorities, Ruff v Webb (1794) 1 Esp 129, Little v Slackford (1828) 1 Mood
and M. 171 and Hamilton v Spottiswoode (1849) 4 Ex.200, but I have gained
little assistance from them. That mere fact that the imperative form of the
verb 'to pay' is not used does not necessarily mean that the instrument is not
an unconditional order to pay. I consider that it is necessary to look at the
whole instrument to see what is intended. The instrument is a formal looking
document made out on a printed form with pre-printed numbering. In appearance
it is like a cheque. There is nothing about the instrument to give it the
appearance of an authorisation or request. The words 'payable to' are not
words of courtesy and are not the equivalent of 'please pay': cf Little v
Slackford, supra. I think it is clear that the instruments are not mere
requests. Are they mere authorities to pay?
18. Dictionary definitions of 'payable' include, in reference to a sum of
money, or a bill, that which is due to a specified person (Shorter Oxford);
owed, to be paid or due (MacQuarie Dictionary). In the context of cheques,
the word is often used in the context of indicating the payee: e.g. "to whom
shall I make the cheque payable?" If the word was intended to mean no more
than 'due to' or 'owed to', it might signify that the instruments were
acknowledgments of debts. Although an acknowledgment of debt would not
require any reference on the form of the instrument to a bank, this does not
necessarily mean that the instruments are not acknowledgments of debts.
19. The word 'order' contained in s.10(1) also needs to be considered. The
words used are "an unconditional order in writing that .... requires the bank
to pay on demand a sum certain in money." "Order" is defined to mean 'a
command' or 'direction' or 'mandate' (Macquarie Dictionary; see also Shorter
Oxford Dictionary). S11 provides that an order to pay "must be more than an
authorisation ..." presumably because an order to pay is in itself an
authorisation to the bank.
20. My conclusion is that the instruments are not cheques because they are
not orders in writing requiring the bank to pay the respondent.
21. In my opinion, for an order to exist within the meaning of the section,
given that cheques are negotiable instruments, it must be clearly expressed on
the face of the instrument and cannot be implied from the appearance of the
rest of the document or the circumstances generally. I do not see how the
words "payable to" in themselves can amount to an order, and there is nothing
else on the face of the instrument which amounts to an order or which would
give the words 'payable to' such a context.
22. These words, as they are addressed to the bank, indicate to the bank that
the relevant amounts are due to the respondent by the appellant, and authorise
the bank to pay the amounts and debit the appellant's account, but they do not
command the bank to pay. It is one thing to say to one's bank that a sum
ought to be paid to another; it is quite another thing to say to the bank,
'and you must pay it.' Similarly the instruments are not bills of exchange
which also require there to be an unconditional order in writing: s8(1) of
the Bills of Exchange Act 1909.
ARE THE INSTRUMENTS PROMISSORY NOTES?
23. A promissory note is defined by s89(1) of the Bills of Exchange Act 1909
as an "unconditional promise in writing made by one person to another, signed
by the maker, engaging to pay, on demand or at a fixed or determinable future
time, a sum certain in money, to or to the order of a specified person, or to
bearer."
24. The question is whether the instruments are unconditional promises in
writing. Chalmers and Guest on Bills of Exchange, 14th Edition, at p658
state:
"The subsection requires a note to contain a promise to
pay. The actual word "promise" need not, however, be
used, and any other words which clearly constitute a
promise to pay are sufficient. But a mere
acknowledgment of indebtedness, though it imports a
promise to pay, is not a note."
25. Byles on Bills of Exchange, 26th Edition, at 338, is to similar affect,
the learned authors adding, however, that there must be evidence of the
intention of the parties to make a promissory note: see also Riley, Bills of
Exchange, 2nd Edition, p277; Conrick, The Law of Negotiable Instruments in
Australia, 2nd Edition, at 158.
26. In my opinion, the words used in the instruments do not clearly
constitute a promise to pay. In Nawab Major Sir Mohammed Akbar Khan v Attar
Singh (1936) 2 All ER 545 at 549, in respect of a document which stated 'this
amount to be payable after 2(two) years', Lord Atkin observed that
"it is indeed doubtful whether a document can properly
be styled a promissory note which does not contain an
undertaking to pay, not merely an undertaking which has
to be inferred from the words used. It is plain that
the implied promise to pay arising from an
acknowledgment of a debt will not suffice ..."
27. Mr Walker SC submitted that the instruments were probably I.O.U.s. In my
opinion that is not strictly correct. An I.O.U. is an abbreviated form of an
acknowledgment of debt: see Byles on Bills of Exchange, 26th Edition, at
348-9. None of the instruments are in this form, but they are, by implication
an acknowledgment of the appellant's indebtedness to the respondent in that
they authorise the Commonwealth Bank to pay monies to the respondent and to
debit the appellant's account.
28. The instruments, therefore are not negotiable instruments, and cannot be
sued upon, although they are evidence of a debt but not of a loan: see Byles,
supra.
29. Counsel for the respondent did not seek to argue that a cause of action
based on any sale of the chips was reasonably open on the evidence. In the
result, the judgment in favour of the respondent cannot be supported because
none of the causes of action upon which the respondent sued were made out,
unless the appellant is estopped from denying that the instruments were
cheques, or unless the respondent's claim based on unjust enrichment is
successful. As these issues were not decided by Thomas J and not argued in
this Court, in my opinion the only course now open is to allow the appeal and
to remit the matter back to Thomas J to determine the outcome of these issues
and to pronounce such judgment as the parties may be entitled to in accordance
with the decision of this Court.
30. As the question of estoppel is still alive, and as a number of other
issues were fully argued at the hearing of the appeal on the assumption that
the instruments were cheques, I think it is desirable that these issues be
dealt with at this stage, particularly if, assuming that the appellant is
estopped from denying that the instruments were cheques, the appellant is
correct in his submission that the actions based on the cheques are not
maintainable. I will therefore deal with these issues, including the issue as
to interest.
THE CREDIT ILLEGALITY ISSUE
31. The appellant's submission was that the instruments were not cheques at
the time they were delivered to the respondent because, at that time, they
were not addressed to a banker. This was properly conceded by Mr Hiley QC,
counsel for the respondent. Mr Walker SC submitted that the consequences of
this were that the respondent was seeking to recover contrary to s.12(5)(a),
(b) and (c) of the Casino Licensing and Control Act.
32. At this point, it is convenient to refer to the provisions of that Act as
it existed in August 1989. Section 4 permits the Minister to grant a licence
under the Act to conduct a casino for the playing of games to a person who had
entered into an agreement in accordance with s.3 of the Act. Section 4(2)
provides that the licence shall be subject to the terms and conditions of the
agreement. "Casino" is defined by s.2 to mean premises licensed under the Act
for the playing of games, and 'game' is defined to mean a game of chance.
Section 5 empowers the Minister to terminate a licence by notice in writing to
the licensee on the ground, inter alia, that the licensee has failed to comply
with a condition of the licence or has failed to comply with a direction
lawfully given by the Minister pursuant to an agreement relating to the
licensing and conduct of a casino. Section 6 empowers the licensee,
notwithstanding any other law of the Territory, to conduct a casino in
accordance with the terms and conditions of the licence, and "to the extent
that any such condition would, but for this section, be in conflict with a law
of the Territory, that law shall be deemed to be of no effect." Section 11
empowers the Minister to declare a game to be an authorised game for the
purposes of the Act, provided that the Minister has approved the rules under
which the game is to be played. Section 11(3) empowers the Minister to alter
the rules of a game by notice in writing. Section 11(6) requires a licensee
to ensure that an authorised game conducted in the casino is conducted in
accordance with the approved rules of the game.
33. Section 12 provides as follows:
"12. PLAYING OF AUTHORISED GAMES
(1) Notwithstanding any other law of the Territory, it
is lawful in a casino for -
(a) the licensee and his employees and agents to
organise or play an authorised game; and
(b) a person, except a person in respect of whom a
direction under section 15 is in force or who has not
attained the age of 18 years, to play any such game.
(2) A casino shall not be deemed to be a nuisance,
public or private, by reason only that it is used as a
gaming house.
(3) The Police Administration Act does not apply to or
in relation to implements or articles used or intended
to be used in the playing of authorised games in a
casino.
(4) The Lotteries and Gaming Act does not apply to or
in relation to a casino or an act performed in a casino.
(5) A person shall not, except against a licensee,
bring legal proceedings to recover -
(a) money won at gaming in the casino;
(b) money on a cheque or other instrument given in
payment of money so won; or
(c) a loan of money with which to play a game in the
casino,
that could not be brought if this Act had not been
enacted."
34. Section 13 empowers the Minister to give directions to a licensee in
relation to certain matters. There are no other relevant provisions. The Act
has since been repealed and replaced by a new Act.
35. As envisaged by s.3 of the Act, the respondent and the Minister (as well
as other parties) had entered into an agreement relating to the licensing and
conduct of the casino. This agreement became Exhibit P20 at the hearing.
Clause 8.3 of the agreement required the respondent to comply with certain
ministerial directions. Clause 9.1 conferred upon the Minister an absolute
discretion to cancel the licence and terminate the agreement or to suspend the
licence in certain circumstances, including, vide Clause 9.1(m) in the event
of default in due compliance with the agreement, if action has not been taken
to remedy the default within 14 days of notice of the default having been
served by the Minister upon the respondent.
36. The Minister had also issued certain directions to the respondent which
became Exhibit P6 at the hearing. These directions are stated to have been
given pursuant to s.13 of the Act, but no doubt, could also have been given
pursuant to Clause 8.3 of the agreement. Clause 3(7) of the directions
provides that, "subject to subclause (8), the licensee shall not accept a
credit bet for any game and shall ensure that credit for the purpose of gaming
is not extended to any person." Clause 3(8)(a) provides:
"(a) Sub-clause 7 does not prevent the cashing of
personal cheques, travellers cheques or bank cheques,
except that -
(i) cheques shall not be exchanged for chips at a
gaming table
(ii) personel (sic) cheques shall not be exchanged for
cash, but will be exchanged for cheque credit slips
issued at the cash desk to the value of the cheques
tendered
(iii) personal cheques are redeemed by the drawer of
the cheque before any winnings are paid
(iv) patrons shall not be permitted to consolidate or
redeem personal cheques with later dated cheques for
the purpose of evading cheque presentation
requirements."
37. Mr Walker submitted that
(1) from the time the instruments were handed over by
the appellant until the time the instruments were
completed by the respondent's staff, (and at all times
when the appellant gambled at the tables) the
instruments were not "cheques" within the meaning of the
Commonwealth Act.
(2) the subsequent completion of the inchoate
instruments did not relate back in time to, as it were,
require the instruments to be treated as if they were
cheques during the period of gambling;
(3) therefore, at the relevant times, the respondent had
breached Clause 3(7) of the directions by accepting
"credit bets".
(4) consequently,
(i) each transaction evidenced by an instrument was a
loan of money within which to play a game at the
casino "within the meaning of S12(5)(c); and
(ii) the loans were not protected by s.6 of the Act as