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[1993] ZASCA 200
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Minister of Mineral and Energy Affairs v Lucky Horseshoe (Pty) Ltd (285/1992) [1993] ZASCA 200; 1994 (2) SA 46 (AD); (1 December 1993)
LL
Case No 285/1992
IN THE SUPREME COURT OF SOUTH AFRICA APPELLATE DIVISION
In the matter between:
MINISTER OF MINERAL AND ENERGY
AFFAIRS
Appellant
and
LUCKY HORSESHOE (PTY) LTD
Respondent
CORAM
: CORBETT CJ, VAN HEERDEN, VIVIER,
KUMLEBEN and NIENABER JJA
HEARD
: 18 NOVEMBER 1993
DELIVERED
: 1 DECEMBER 1993
JUDGMENT
VAN HEERDEN JA
:
2 During 1991 the respondent initiated a scheme whereby it supplied
tickets to certain retailers who had become partakers in the scheme
("the Lucky
Horseshoe scheme"). Those retailers, about 23% of whom were eventually filling
station operators, bought the tickets
from the respondent. In turn they
distributed the tickets free of charge to members of the public. Such a ticket
entitled the recipient
to participate in a monthly draw which determined
prizewinners by chance.
There is no doubt that the respondent
originally encouraged partaking retailers to give a ticket to every customer
buying some article
or commodity from them. Indeed, the perceived
raison
d'etre
of the scheme was that once having procured a ticket a customer would
regularly return to the same outlet to obtain more tickets
by making further
purchases. However, after the legality of the scheme
3 had been
queried, the respondent began distributing amended guide-lines. In it partaking
retailers - or at least filling station
operators - were advised to distribute
tickets to all members of the public visiting their outlets whether or not they
made any purchases.
Some time after the inception of the Lucky
Horseshoe scheme the appellant and two other parties, the Motor Industries
Federation and
its executive director, took up the attitude that as far as
filling stations were concerned, the scheme was hit by regulations ("the
petroleum regulations") published under the Petroleum Products Act 120 of 1977
(Regulation 1100, Government Gazette 10260 of 2 June
1986). In response to what
it considered to be threats or veiled threats, the respondent then brought
motion proceedings against
the appellant and the other two parties in the
Transvaal Provincial Division. In the
4 main it sought orders
declaring that a phrase in regulation 1(b) of the petroleum regulations was
ultra vires
the enabling provisions of the Act, and that hence the Lucky
Horseshoe scheme did not offend against those regulations. The application
was
opposed by the appellant and the other two parties who disputed the alleged
invalidity of the phrase in question. In a supplementary
opposing affidavit the
appellant moreover contended that the scheme was a lottery in contravention of
the Gambling Act 51 of
1965.
The court a
quo
(Van Dijkhorst J) found that the
scheme did not contravene the relevant provisions of the Gambling Act; that the
said phrase was
ultra vires
the enabling section of the
Petroleum
Products Act, and
that once that phrase is excised the scheme does not fall foul
of the petroleum regulations. Hence it allowed the application
with
5 costs, but subsequently granted the appellant leave to appeal
to this court. (The judgment has been reported:
Lucky Horseshoe (Pty) Ltd v
Minister of Mineral and Energy Affairs
1992 (3) SA 838
(T): the other two
parties did not seek leave to appeal.)
On appeal the appellant again
submitted that the Lucky Horseshoe scheme is hit by the provisions of the
Gambling Act. Although the
respondent did not seek a
declarator
that the
scheme was not in conflict with those provisions, its counsel, in his heads of
argument, wisely did not contend that the
appellants were precluded from relying
upon them. In this court he submitted, however, albeit not with much vigour,
that the appellant
is indeed so precluded. The submission is without
substance.For if the Lucky Horseshoe scheme is illegal on that score, the
question
whether it also contravenes the petroleum regulations would be of
academic interest
6 only, and an order declaring that it does not do
so would therefore be a
brutum fulmen
creating the false impression that
it is legally unassailable. I therefore proceed to examine the appellant's first
submission.
In so far as it is material, s 1 of the Gambling Act defines a "lottery"
as
"any lottery in the generally accepted meaning of the word, and more
particularly every scheme, arrangement, system, plan or device
by which any
prize is or may be gained, won, drawn, thrown or competed for by lot, dice or
any other method of chance, either with
or without reference to the happening of
any uncertain event other than the result of the application or use
of
such lot, dice or other
method of chance
...."
S 2(1) provides
inter alia
that no person shall establish or
commence a lottery or perform any act with the object of assisting any other
person to acquire
from any source any ticket in a lottery. In terms of s 8 any
person who contravenes any provision
7 of s 2(1) shall be guilty of
an offence. S 10(b) provides, however, that nothing contained in the Act "shall
apply in relation to
any lottery ... in respect of which no subscription is to
be made". And in terms of s 1 "subscription" includes "the payment or delivery
of any money, article, matter or thing ... for and in consideration of the right
to compete".
The Gambling Act repealed legislation pertaining to
lotteries which had been enacted in the pre-Union colonies and republics. The
relevant contents of those laws are set out in the reported judgment of
Dijkhorst J (at pp 842-3) and no purpose would be served
by repeating his
concise summary. It suffices to say that Transvaal Law 7 of 1890 defined a
lottery in much the same way as does
the Gambling Act, but subject to the
requirement "waarbij inteekenen plaatsvind". "In te teekenen" was in
turn
8 defined as:
"te betalen of af te leveren, hetzij door tusschenkomst van een agent of
niet, aan eenigen persoon, wien ook, eenige som gelds of
eenig artikel, zaak of
voorwerp, roerend of onroerend, hetzij zoodanig artikel of voorwerp in zich zelf
van geldswaarde is of niet,
voor, en in consideratie van en met net oogmerk om
van eenigen persoon of eenige personen, wie ook, eenig recht of de erkenning van
eenig recht te ontvangen om deel te nemen in, of eenige kans te verzekeren om
eenigen prijs in een loterij te winnen."
In
R v Lew Hoi
1937 AD 215
,220 this court held that the following
were the essential characteristics of a lottery under Law 7 of 1890:
"(a) some payment by the participant in the form of a stake,
(b)
in return for
this payment or in consequence of it, acquisition by the player of a right to a
prize on the occurrence of an
event,
(c)
determination of
the occurrence of the event by
chance."
It was rightly
common cause that by virtue
of the provisions of s 10 of the Gambling Act those
9 are
also the characteristics of an
illegal
lottery under that Act, and in
particular that a scheme which does not require some or other participant to
make a subscription does
not contravene the Act's substantive provisions (cf
Commissioner for Inland Revenue v Insolvent Estate Botha t/a 'Trio
Kulture'
[1990] ZASCA 2
;
1990 (2) SA 548
(A) 554, 561 and 563). It was furthermore, and
again rightly, common cause that if the Lucky Horseshoe scheme involves payment
of
subscription (a stake) it satisfies the above requirements. As regards the
application of the Gambling Act the only issue therefore
was whether a
participant (or a retailer-partaker) in the scheme pays something in the nature
of a stake in order to obtain a ticket,
i e, whether he makes a
subscription.
The court a
quo
firstly found (at p 845) that the only persons who
make subscriptions are the retailers who, however, cannot be regarded as
par-
10 ticipants (or "players"), since they do not obtain a "right
to compete". The retailer is therefore "in the camp of the organizer
of the
lottery [and] not in the camp of the participant who is to pay or deliver" the
subscription. Secondly, the court found (at
p 846-8) that because a customer
cannot compel the issue of a ticket, there is no subscription made by him, and
that
dicta
in
R v Morrison
1914 TPD 329
, and the decision of this
court in
R v Ellis Brown Ltd
1938 AD 98
, do not assist the
appellants.
Before this court counsel for the appellant challenged
both findings. He repeated his argument in the court a
quo
, viz, that s
10(b) of the Gambling Act saves a lottery only if no subscription is made; that
a subscription includes a payment made
by any source other than the organizer
(in
casu
the respondent), and that under the Lucky Horseshoe scheme
retailers do make subscriptions. I shall,
11
however, assume that the first finding is unassailable . I therefore
proceed to examine, in the context of the second finding, the
applicability of
the above cases.
In
Morrison
the appellant had offered to
give a coupon to any person purchasing for cash five shillings worth of goods at
his store. In terms
of the offer the holder of one of the coupons to be issued
would eventually win a prize determined by lot. It was held that the scheme
constituted a lottery within the meaning of Transvaal Law 7 of 1890. In arriving
at this decision the court rejected an argument
that prospective customers would
not make subscriptions since they would not pay more for goods (plus the coupon)
then they would
in any event have paid for the goods as such. In this regard
Mason J said (at p 333):
"The appellant offers to sell his goods and offers every purchaser of goods
an option
12
to take one of the coupons. Now the acceptance of the offer by the
purchaser constitutes a complete contract of sale. If the contract
were entirely
valid, there is no question about it that every person who went into the
appellant's shop and purchased for cash five
shillings' worth of goods could
compel the delivery to him of a coupon. It seems to me impossible to say that
that is in part a contract
of sale, and in part a contract of gift - if one may
use such a phrase. However difficult it may be to apportion the consideration
(namely, the five shillings) which is given for the goods between the price of
the goods and the coupon, and even though, as admitted,
the goods are worth the
price, nevertheless in my opinion that consideration includes both the price of
the goods and the right to
receive a coupon. I think, therefore, that where a
person buys goods under these circumstances he has subscribed or paid money for
and in consideration of the coupon and with the object of receiving the coupon,
to secure a chance of winning a prize in a lottery.
It is true that in some
cases, perhaps, the persons who purchase goods do not accept the option of
taking the coupon. But nevertheless,
when once they accept it, and take the
coupon, it all forms, to my mind, one contract, and that contract includes not
only the goods
but the coupon."
In
Ellis Brown
this court endorsed those
13 views. The
appellant had sold tea and coffee in sealed tins, and had enclosed in
some
tins coupons entitling the purchaser of such a tin to a prize. It
was held that the scheme was a lottery under s 2(a) of Natal Act
3 of 1902
because the element of subscription for the right to participate in the chance
of winning a prize was present in the scheme.
In the words of Watermeyer JA (at
101) the chance of a prize was inseparable from the tin of tea or coffee and was
bought with it,
so that the purchasers paid for their chance in the price which
they paid for the tin of tea or coffee.
In
Imperial Tobacco Ltd
and Another v Attorney-General
(1980) 1 All ER 866
, the House of Lords
reached a similar conclusion. In that case a tobacco company had launched a
sales promotion campaign whereby
every packet of cigarettes contained a ticket.
If spaces on the ticket were rubbed possible
14 prizes were
disclosed and if three of them corresponded the ticket holder, i e the purchaser
of the cigarettes, was entitled to
collect that prize. It was held that the
scheme constituted a lottery even though the purchasers paid no more for the
cigarettes
plus the ticket than they would have paid for the cigarettes as such.
In this regard Viscount Dilhorne (at p 874c) thus formulated
the
ratio
decidendi
of a number of cases of which he approved:
"That ratio I take to be that where a person buys two things for one price,
it is impossible to say that he paid only for one of them
and not for the other.
The fact that he could have bought one of the things at the same price as he
paid for both, is in my view
immaterial."
In the light of these
decisions it seems clear that if under the Lucky Horseshoe scheme a customer
becomes entitled to a ticket when
making a purchase from a partaking retailer -
or when purchasing a particular commodity or for more than a
15
stipulated minimum price - the customer in fact pays a subscription when so
purchasing. Subject to an argument to which I shall
advert, this much was not
really disputed by counsel for the respondent. He relied, however, on the
factual approach underlying Van
Dijkhorst's J second finding.
The
grounds upon which Van Dijkhorst J sought to distinguish the facts of this case
from those of
Morrison
and
Ellis Brown
may be summarised as
follows. The amended guide-lines of the respondent do not provide that a
partaking retailer must give a ticket
to a customer who makes a purchase, or a
stipulated purchase, at his outlet. Hence, a customer who has concluded a
purchase, cannot
compel the retailer to issue a ticket to him. Moreover, the
element of inseparability referred to in
Ellis Brown
is absent in
casu
. This is so because (at p 846): "All customers do not necessarily
get tickets and
16 whether the customer does or does not obtain one
the customer still pays the same price".
It is true that in the
amended guide-lines retailers are urged to avoid any suggestion that a ticket is
given to a customer in consideration
for the purchase of petrol; that tickets
should be made available to any person who visits an outlet for any purpose
whatsoever,
"whether that be for workshop services, spares, restaurant
facilities, cloakroom facilities or the purchase of petrol"; that the
issuing of
tickets to customers is at the sole discretion of the retailer, and that it must
be borne in mind that the
quid pro
quo for the issuing of a ticket is
simply that the "customer" has visited the outlet. Two points should be made.
The first is that
the amended guide-lines relate only to filling stations and
not also to other retail outlets. However, since this appeal is concerned
with
the
17 lawfulness or otherwise of the operation of the Lucky
Horseshoe scheme at filling stations, this aspect may be ignored. The second
and
more important point is that the guide-lines were not intended to govern the
agreements concluded between the respondent and
partaking retailers. Indeed, in
the guide-lines, contained in its circular to operators of filling stations, the
respondent
recommended
that the "guidelines be implemented as far as
possible".
On paper the present guide-lines can hardly be reconciled
with the true purpose of the scheme as set out in the respondent's original
promotional material. It was there said that:
"The Lucky Horseshoe Marketing method is based on the simple precept that
whenever a customer makes a purchase she is given a gift
for doing so at your
store. Not just a gift of nominal or little value, but a gift in the form of a
Lucky Horseshoe draw ticket which
could possibly win for your customer a prize
ranging from R10 to more than R250 000 or even greater."
18
And the first of a number of examples
given
to explain how the scheme could be used to benefit a
retailer's business, was thus phrased:
"You can give a Lucky Horseshoe ticket to every customer buying from your
shop. This will prompt the shopper to return again and
again."
The court a
quo
held that
the matter before it had to be judged on the amended guide-lines and that would
appear to be correct. As will appear, however,
the original guide-lines cannot
simply be ignored.
It is true that in terms of the amended
guide-lines a partaking retailer is not contractually bound to the respondent to
issue a ticket
to a customer who buys from him. But neither is he bound not to
do so, or to issue a ticket to a prospective customer who eventually
refrains
from buying, or to somebody who without commercial intent makes use of
a
19 portion of his premises, such as a rest room. And it is here
that the original promotional material and guide-lines loom large.
As has been
pointed out, the very essence of the Lucky Horseshoe scheme is that if a
prospective purchaser knows that when he buys
from a retailer he will receive a
ticket, he will make a point of again purchasing from that outlet. From the
retailer's point of
view little purpose would therefore be served in not giving
a ticket to such a customer, or to distribute tickets to persons who
have not
made purchases. To adapt the catch lines in that material, a customer's sure
knowledge that he will receive a ticket every
time he makes a purchase - or at
least one of a certain value - will prompt the customer to return again and
again. By contrast,
if he does not obtain a ticket he will feel aggrieved and
take his custom elsewhere.
Hence, when amending its guide-lines, the
20 respondent must have appreciated that in all probability partaking
retailers would issue tickets to purchasers, and seldom would
provide tickets to
mere "visitors". That this is precisely what happened in practice after the
distribution of the amended guidelines,
is illustrated by a number of affidavits
filed in the court a
quo
. From these it appears that when requests were
made at filling stations for the issue of Lucky Horseshoe tickets, the
solicitors
were told that in order to obtain tickets they first had to buy
petrol.
There is also very little doubt that generally a partaking
retailer will endeavour to make it known - if only by conduct - that a
ticket
will be issued to all purchasers, and that this offer will in the course of time
be accepted by customers. I therefore cannot
agree with the view of the court a
quo
that a purchaser at the outlet of a partaking
21 retailer will not be able to compel the issuing of a ticket to him.
Ignoring the invalidating effect of the Gambling Act, he will
as a rule be
entitled to do just that.
In the result I am of the opinion that
even on the amended guide-lines the Lucky Horseshoe scheme is in essence one
whereunder a customer
purchases not only a commodity, such as petrol, but also
the chance of winning a prize. A portion of the price, albeit a small one,
therefore constitutes a subscription as defined in the Gambling Act. (Judging by
the price payable by a retailer to the respondent
a ticket appears to be worth
some 25 - 30 cents). To paraphrase the above quoted dictum of Watermeyer JA in
Ellis Brown
: it is only, or at the very least mainly, by the purchase of
petrol that a chance of receiving a prize is acquired; hence that chance
is so
inseparable from the petrol purchased that it is
22
bought with the petrol. In sum, in purchasing the petrol the customer
also buys the chance.
At the outset of his argument counsel for the
respondent seemed to have suggested that there can be no prohibited lottery
unless the
participant makes a subscription to the organizer, i e the person
providing the prizes. It is clear, however, that the definitions
of "lottery"
and "subscription" in s 1, read with s 10, of the Gambling Act postulates no
such requirement, In
casu
the Lucky Horseshoe scheme results in a
participant making a contribution to the retailer who has purchased the tickets
from the
respondent who will in turn provide prizes to some of the participants,
and there is consequently a very real link between the three
cogs of the scheme.
In any event, in
Ellis Brown
and
Imperial Tobacco
it was regarded
as immaterial that the prizes were provided by the manufacturer whereas the
subscription was made
23 to the dealer.
In view of my
above conclusion it is obviously unnecessary to consider whether the Lucky
Horseshoe scheme also falls foul of the petroleum
regulations.
The
appeal is allowed with costs, including the costs of two counsel, and the order
made by the court a
quo
is altered to read:
"The application is dismissed with costs,
including the costs of two counsel."
H J O VAN HEERDEN JA
CORBETT CJ
VIVIER
JA
CONCUR
KUMLEBEN JA
JUDGMENT
NIENABER
JA:
2
I have had the benefit of reading the judgment of Van Heerden JA. I
arrive at the same conclusion but I do so along a different route.
Hence this
judgment.
Van Heerden JA refers to two findings of the court
a
quo. The first (to be found at 845C-G of the judgment
of
the court a quo, reported in
1992 (3) SA 838
(T)) is that
retailers are "in the camp" of the organiser of the
scheme and not in the camp of their customers; a payment
made
by the retailer to the organiser is accordingly to
be treated as if
it were a payment of the subscription by
the organiser itself; and (so the finding concludes):
"A subscription cannot, in my view, be called that if it does not
originate with the participant but is in fact donated by the
organiser."
The second finding of the court a quo (at 846A-B of the
reported judgment) is that the customer acquires no
contractual right to obtain a ticket; accordingly he
cannot compel the retailer to give him one even if he
3
concluded a purchase; and that it is this feature (referred to as "the
element of inseparability"), which distinguishes the present
case from leading
cases such as R v Morrison
1914 TPD 329
and R v Ellis Brown Ltd
1938 AD
98.
Van Heerden JA assumed the first finding to be unassailable and
held the second to be wrong. My approach is the reverse: to regard
the first
finding as being wrong and to disregard the second. Either way the appeal is to
succeed.
To be a prohibited lottery there must be a contribution or, as it is
referred to in the Gambling Act 51 of 1965 ("the Act"), a subscription.
In the
instant case two forms of subscription are at stake: first, the 25-30 cents per
ticket paid by the retailer to the organiser
of the scheme and second, the
undeterminable proportion of the fixed petrol price which is apportioned to the
unsolicited ticket
given to the customer and which
4
the customer is said to pay to the retailer when he fills his car with
petrol (cf R v Morrison supra 333). Van Heerden JA considers
the latter payment
to be the required "subscription"; on my approach it is the former which is to
be scrutinised. And that pertinently
raises the question: must the subscription,
for the game of chance to be a lottery in terms of the Act, necessarily be
ventured by
or on behalf of the player (sometimes called "the adventurer": cf R
v Cotterill
1927 CPD 48
51) who qualifies for the draw?
There are the odd references, scattered throughout the cases, which seem
to suggest that the subscription or stake must emanate from
the player (and
therefore not from anyone else) before the scheme can be said to be a prohibited
lottery (cf R v Cotterill supra
51 52; R v Livingston
1924 TPD 45
50; R v Lew
Hoi and Others
1937 AD 215
219; S v Mbonambi
1986 (3) SA 839
(N) 844E-H;
Commissioner for Inland Revenue v Insolvent Estate Botha
5
t/a "Trio Kulture"
[1990] ZASCA 2
;
1990 (2) SA 548
(A) 561I-J;
Imperial
Tobacco Limited and Another v Attorney-General
[1980]
1
All ER 866
(HL) 872c-d; 874d-e; 880b-881h). Other
dicta
describing the characteristics of a lottery are
neutral
(cf R v Clapp
1902 TS 106
; R v Cranston
1914 AD 238
; R
v
Gondo
1951 (3) SA 509
(A) 511B-E; S v Midas
Novelties
(Pty) Ltd and Another
1966 (1) SA 492
(A) 498A-H).
In
none of these cases did the point now under
discussion
crisply arise and in none of them was a principle in
that
regard formulated. A possible exception is R v
Cotterill
supra 51 52, but the issue in that case was again
a
different one: whether the scheme as a whole was
a
lottery when only some of the competitors made
a
contribution.
The definition of "lottery" in the Act (quoted in the judgment of Van
Heerden JA) opens with the words: "any lottery in the generally
accepted meaning
of the word.. ." The locus classicus in our law as to the
6
generally accepted meaning of the word remains the dictum
in R v Lew Hoi and Others supra 220:
"...[t]he essential characteristics of a lottery under Law 7 of 1890, are:
(a) some payment
by the participant
in the form of a stake, (b) in return
for this payment or in consequence of it, acquisition
by the player
of a
right to a prize on the occurrence of an event, (c) determination of the
occurrence of the event by chance." (My emphasis).
According to Van Dijkhorst J, at 845F-G of
the
reported judgment, the words "participant" in (a)
and
"player" in (b) "obviously refer to the same person".
With respect I am not sure that it does. The selection
of two separate words when, if a single concept was
intended, either would have been appropriate in (a) or
(b), may well have been deliberate. Mostly, of course,
it will not matter. The subscription will usually be
payable by the person who is a contender for the prize.
But the facts of this case illustrate that it is not
invariably true. The participant in the respondent's
scheme, the retailer, is not a player and the player, the
7
customer, is not a participant in the scheme. In my
opinion
the dictum quoted above does not purport to lay
down a rule that the
subscription must in all cases be
contributed by or on behalf of the
player. It is also
not without significance that the definition of
"subscription" in section 1 of the Act is entirely
noncommittal on the point. The legislature presumably
had the dictum in mind when this definition was enacted.
It reads:
" 'Subscription' means the payment or delivery of any money, article,
matter or thing (including any ticket, coupon or entrance form
purporting to be
supplied free of charge to the readers of any newspaper or other periodical
publication) for and in consideration
of the right to compete".
It is a matter for comment that there is nothing in that
definition or in the definition of "lottery" to indicate
by or to whom the subscription is to be made.
It was argued on behalf of the respondent that the
expression "for and in consideration" is a clear
indication that the subscription must of necessity be
8
made by the party who obtains "the right to compete". I disagree. The
argument entails a petitio principii: it presupposes the addition
(at the end of
the definition) of the very words ("by the person making the subscription")
which are needed to clinch the argument.
Here it is the retailer who makes the
payment to the organiser; in return ("in consideration of") he is given a
ticket; the ticket
carries with it "the right to compete". That right to compete
is not, either in terms or by necessary implication, confined to the
person who
makes the payment.
The scheme amounts to this: the retailer pays an agreed amount to the
organiser of the scheme in return for which he receives an agreed
number of
tickets. These he is at liberty to distribute as and to whom he pleases. When he
hands a ticket to a customer the latter
is free to enter the competition or not.
If he chooses to do so he completes the prescribed form, inserts his name
and
9
submits it to the organiser. If his number is drawn, which is a matter
governed entirely by chance, he is entitled to the promised
prize. There is no
question, on that analysis, of the retailer being "in the camp" of the
organiser, as was held by the court a quo.
With respect, the payment for the
ticket by the retailer to the organiser cannot be equated, as was also held, to
a gift by the organiser
of the ticket to the customer. All three parties are at
arms' length to one another. The organiser of the scheme promotes it for
the
profits it generates; the retailer participates in it for the additional custom
he hopes to attract by distributing tickets free
of charge; and the customer
accepts the ticket and enters the competition in the hope of winning a prize. In
purchasing a ticket
from the organiser the retailer is acting primarily in his
own interests but in order to do so he is, at the same time, stipulating
a
benefit for a yet to be ascertained third party. That
10
benefit is the right to compete for the prize. The third party is
identified as the beneficiary when he submits the completed form
to the
organiser. By doing so he accepts the benefit stipulated for him by the retailer
and obtains the right to participate in the
organiser's draw. This triangle of
contracting parties conforms in every detail to the prototype of a contract in
favour of a third
party (cf Van der Merwe et al. Contract: General Principles
par 9.2.5). As such it exhibits all the elements of a lottery: a stake,
the
opportunity, in return, to compete for a prize, the capturing of which is
dependent on lot or chance.
And if that is the correct analysis it becomes unnecessary to grapple
with a problem which would arise, on the view favoured by Van
Heerden JA, if the
retailer should give a ticket to a customer (or his family or friends) who does
not buy petrol but, say, visits
the retailer's cloak room; or to a customer who,
without
11
prior knowledge of the scheme, does buy petrol but receives a ticket only
after the sale had been concluded. It is not easy to appreciate
how the customer
in either of these situations can be said to pay a subscription to the retailer:
in the one instance he pays nothing
at all and in the other he clearly does not
intend to buy two items (petrol and the ticket) for the price of one. Yet that
is the
construction which, on the other view, must perforce be placed on each
transaction involving the hand-out of a ticket if it is to
be characterised as a
prohibited lottery. In addition the retailer's intention must also be
considered, which might well be to regard
the ticket not as part of the sale of
petrol but as a bonus to his customer.
Upon the construction advanced above - that a subscription is made
whenever the retailer, on payment of the prescribed sum, stipulates
a benefit
for his future customers in the form of a lottery ticket - the "element
12
of inseparability", which was the deciding factor in the Ellis Brown case
supra, becomes immaterial. This construction has the added
advantage that it
avoids the necessity of making a finding to the effect that the amended
guidelines were designed to disguise the
true nature of the scheme (viz, that
tickets are only to be handed to actual purchasers of petrol and that any such
purchaser has
a right to compel delivery of a ticket to him). On the view
espoused above these issues no longer matter since the true nature of
the
transaction can objectively be gauged from the respondent's own version of the
facts.
Looked at as a whole and from a practical standpoint, as one is enjoined
to do (cf s v Midas Novelties (Pty) Ltd and Another supra
500A), the scheme
unfolds itself as, in essence, a prohibited lottery. It is no less one because
of the technicality that the stake
is not paid by the designated player but by
an
13
intermediary (the retailer) who is not an agent but is nevertheless
acting both for his own and for his customer's ultimate benefit.
The
subscription which is a requirement for a prohibited lottery is the amount which
the retailer pays to the organiser for the tickets
which he in turn distributes
to his customers. And because a subscription, as defined, is paid, s 10(b) of
the Act cannot assist
the respondent.
In the result I concur in the order proposed by Van Heerden JA.
P M Nienaber JA