Premier Swiss Group (Australia/Asia) Pty Ltd v. Robins Haigh McNeill Pty Ltd and Anor
13 ACLR 547
Supreme Court of New South Wales - Equity Division
Waddell CJ in Eq
Leveraged foreign currency contracts
Whether void as contracts by way of gaming or wagering
(NSW) Gaming and Betting Act 1912 - s 16
Universal Stock Exchange, Ltd v. Strachan, applied -  1 AC 196
Morley v. Richardson, applied - (1942) 65 CLR 512
Hearing date: 16 November 1987
Judgment date: 9 June 1988
The liquidator of the plaintiff company applied for directions as to the basis upon which claims by persons who had entered into leveraged currency contracts with the company should be admitted. The question was whether the contracts were illegal under s 16 of the Gaming and Betting Act 1912 (NSW) which provides that "all contracts ... by way of gaming or wagering shall be null and void".
The effect of the contracts was that the company agreed to deliver a "leveraged sum" of foreign currency to the client on the delivery date on condition that the "purchase delivery price" was paid to the company seven days beforehand, or, at the option of the client, to pay the amount by which the leveraged sum had appreciated against the pound sterling at the time of exercise of the option.
The company solicited business by newspaper advertisements which indicated that making quick profits by the exercise of the option was the primary object of each investment rather than the purchase of actual currency.
- If the written contract reflected the true arrangement between the parties it would not be a contract of wagering because part of the contract provided for actual delivery of foreign currency and it could not be said that neither of the contracting parties had no interest in the contract other than in some sum which might be won or lost.
- Universal Stock Exchange, Ltd v Strachan
 1 AC 196
; Morley v Richardson (1942)
65 CLR 512
- Although it was likely that in most investments neither the client nor the company contemplated payment of the purchase delivery price and actual delivery of the foreign currency, there was no evidence to indicate that the client was not entitled to claim delivery of foreign currency or that the company was not obliged to give it. The written contract did actually record the true arrangement between the parties, and the contracts were not void under s 16.
Liquidator's summons for directions
The liquidator of the plaintiff company sought directions as to admission of claims by persons who had entered into certain contracts with the company.
Cur adv vult.