Lottery prize dispute

Press, 5 December 1989, Page 16

Lottery prize dispute

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Over the years Ombudsmen have from time to time become involved in investigating events surrounding establishments of entitlement to winning prizes. It is surprising the number of claimants when prizes are unclaimed in the first instance, and this inevitably leads to disputes over the merits of the claims. In this case ownership was soon determined, but the question arose as to whether interest was due on the prize because its pay-out had been delayed.

The complainant had purchased a winning lottery ticket in the name of her infant son. The lottery organiser sought a declaratory judgment to determine who was the rightful claimant, which delayed payment of the prize by eight months. The complainant, who had originally claimed the prize, was adjudged to be the person entitled and sought interest on the prize money for the period between her entitlement to the prize and payment of jthe monies, plus reimbursement of her legal costs. The. claims were

resisted of ’*l Internal Aftairaaadthe. com- \ i plainant sought assistance of the Ombudsman. 'T / An unsuccessful application for costs had been made to the ,court and that qspecOas therefore outside jurisidlctien. While the : question of Interest,could also have beemtsased in court, it was not, and an.investigation of the' decision not to pay interest was agreed. $ The department had resisted • ' J payment on , the . grounds that such payment was not contemplated by the relevant legislation, .me Gaming and Lof- ■ teries Act 1077*.The investigation revealed that the * department was also concerned to avoid the creation of a precedent for the payment of interest where there is a delay in, establishing a claim to a prizes. The prize money in this case had, in fact, been placed in aninterest-eamingac-count until required, together

- with other funds, with the result that the interest earned could ; not be separately identified. - The circumstances of this case \ could be distinguished from a .case of late establishment of a /claim, in that it Was clear from the time the prize was claimed that a rightful claimant existed, ■ although there was a reasonable doubt as to who it was. In the Ombudsman’s view any benefit accruing from the use of the . money . after that- time belonged . to , whoever was identified as being entitled to the prise: \- The Ombudsman concluded . .that the refusal to pay interest to the complainant was ufifeaaon- • able, and that interest , at/the maximum rate of interest under the Judicature (Interest oh Debts and Damages) Order 1980 should be paid for the period between the entitlement?and actual pay-' ment. The Secretary , and the Minister for Internal Affairs accepted that conclusion and made payment of the interest to the complainant, thus respiring the grievance. —John Robertson, Chief Ombudsman.