Sunwest International wins first round in dispute over MVG loyalty credits

The Western Cape High Court has found in favour of Sunwest International in an ongoing legal battle concerning allegations that three MVG loyalty programme members unlawfully accrued millions in credits at GrandWest Casino from a machine that had malfunctioned.

The matter concerns an application by Sunwest International opposing a counter-claim made by the loyalty programme members arguing that their claim is “vague and embarrassing”, lacking the necessary details to establish a case.

Sunwest International is a subsidiary of Sun International which owns and operates the Sun MVG loyalty programme across its licensed casinos and sports betting businesses in South Africa including GrandWest Casino.

Sunwest alleges that between January 26 and 29, 2023, the members entered their GrandWest premises and partook in gambling activities including playing slot machines.

On January 26, by playing on machine 72504, one of the members recognised that the machine had malfunctioned. In this regard, the credits that were transferred to machine 72504 remained on their MVG card and thereby increased the number of credits on the card.

“The plaintiff furthermore contended that the first defendant, having recognised that machine 72504 was malfunctioning, through intentional and fraudulent use of his MVG card, unlawfully accrued credits from machine 72504 in the sum of R1 075 772.90.

“The first defendant withdrew R24 000 in cash and requested the sum of R1 047 433.80 to be transferred from GrandWest to Sibaya (Casino in Durban) where he withdrew the sum of R1 million in 2 tranches of R100 000 and R900 000 respectively, in cash from the cashier,” court documents read.

Sunwest argues that in terms of its regulations, it has various disclaimer notices situated at places such as the entrance to GrandWest, the cash desks in the casino area and all the slot machines in the casino area, that read: “It is possible for electronic equipment and slot machines operated on these premises to malfunction. The operator reserves the right to verify such equipment and machines prior to making payments or rewards in respect of winnings and/or prizes.”

The loyalty programme members however argued that they had a tacit agreement, or a contract formed based on the actions or behaviour of the parties involved, rather than through written or spoken words, with the casino.

They argued that the terms of the tacit agreement were that they would participate in gambling activities at the plaintiff's premises; in participating in the gambling activities, the defendants would make use of MVG cards and/ or day visitor cards; would deposit monies into the loyalty card, alternatively make use of accumulated credits available on the loyalty cards.

“The defendants were entitled to withdraw any accumulated credits from the loyalty cards at their exclusive discretion and on demand; the plaintiff would be liable to pay to the defendants any accumulated credits that the defendants sought to withdraw at their exclusive discretion and on demand,” the members submitted.

The main issue in question at this stage raised by Sunwest was around the members’ failure to allege “the date the tacit agreement was concluded; the place; the identity of the plaintiff's authorised representative and the conduct upon which the respondents intend to rely to establish the tacit agreement,” among others.

Ultimately Acting Judge Pearl Andrews said: “In my view, the vagueness relates directly to the defendants' cause of action which requires particularity insofar as it relates to the date when the tacit agreement was entered into, the specific place where the tacit agreement was entered into and the specific person with whom the tacit agreement has been entered into.

“The first, second and third defendants' are afforded the opportunity to amend their counter-claim within 20 days of the granting of this order in terms of Rule 28.”

Sunwest International welcomed what they described as a well-reasoned interlocutory judgment handed down which upheld their exception that the tacit agreement alleged by the defendants in their counter-claim was vague and embarrassing and Sunwest could not plead to it.

“Sunwest now awaits the defendants’ amended counter-claim so as to progress the trial action.”

Cape Times