Creating the Ultimate Bet Agreement Template: A Step-by-Step Guide

All About Bet Agreements

A bet agreement is simply a means by which two or more individuals enter into a contract with each other. In this case, the subject of the contract is the outcome of some event. In its most simplest terms, a bet agreement is a contract between two or more individuals where one party agrees to pay the other if a certain outcome occurs.
In the context of sports wagers in New Jersey, as well as in other gambling and/or betting jurisdictions, a bet agreement between two or more parties is a contract that will allow the parties to exchange something of value (i.e., money) based on the outcome of a sporting event.
A bet agreement typically involves the following:
Let’s look at an example of an NJ sportsbook wager:
Let’s assume that Evan and Emily are friends. They go to identical bars on Sundays and watch football on TV. They know each other because they had the same friends in college. However, the two have never had a conversation about football. Evan has been a lifelong Giants fan and Emily has been a lifelong Eagles fan. Let’s say that the Giants and Eagles have the same record coming into their Week 16 matchup. Therefore, the game determines who goes to the playoffs.
NJ sportsbooks are giving the Eagles a 7-point lead. This means that the NJ casino will allow you to wager on the Colts to win the game by 7 or more points. Separately, you can wager on the Titans to win by 7 or more points. That’s called buying 7 points.
Evan and Emily go to the local bar and decide to make a friendly wager. Evan is obviously betting that the Giants will win the game while Emily is hedging her bet on the Eagles. A big potential obstacle to Evan and Emily’s wager is that neither actually believes the Giants will win the game . In fact, the two would never agree to bet if they had to pay the casino the same amount as they are laying off on each other. This is where the Bet Agreement Template comes in.
Emily and Evan use the Bet Agreement Template to make a bet. The Bet Agreement Template provides that they will both wager $10 of their own money on the game. They are able to agree on the terms because, in this bet, whoever loses gets an extra $10 added as a penalty for losing on the biggest bet of the day – just like in Blackjack when a player makes a side bet on the outcome of a hand.
Evan and Emily want to place a $10 wager each on the following proposition bet: The Giants will WIN the game by MORE than 7 points.
Emily is ready to bet on the Eagles and immediately has $20 in $1 bills to put on the bet. Emily likes to consider herself a risk taker and is willing to lay off 2 points and lose the bet. In other words, Emily wants to add a $20 bounty onto the bet that will make her payment a total of $40 if she loses. Meanwhile, she wants Evan to pay an additional $20 on top of the $20 she owes him if the Giants lose by 2 points or less.
Taking both Evan and Emily’s side bets into consideration, they are able to agree to the following bet agreement.
Emily and Evan have a great time that Sunday and end up forgetting to take a picture of the Bet Agreement Template. The game is over – the Giants WON by 21 points. Evan sits down to collect his winnings but is soon told by FrenchY that he must also pay Emily $20 in make up money. Evan would not have agreed to the bet if he knew he had to pay the "make up". If Evan and Emily had signed the bet, he would have no choice but to pay Emily the $20.

Components of a Bet Agreement

A carefully crafted bet agreement includes several essential components that ensure clarity and minimize the potential for disputes. The following elements should be considered when creating your agreement:
Parties to the Agreement: In this opening section, you should clearly identify each party involved in the bet. Names and contact information for all individuals, legal entities, and any other involved third parties should be listed, along with a description of their roles in the bet.
Terms and Conditions: This critical component of the bet agreement should detail exactly what the bet entails. The terms of the bet should be described comprehensively, including any contingencies that may arise. The terms of the agreement should be unique to the specifics of each bet and are typically tailored to the particular wager being placed. In some cases, such as betting on the outcome of award shows or sporting events, the outcome may not be known until the event has concluded.
Stakes: Lay out in detail what is at stake for both parties will lose the bet. Is a lost bet a binding agreement to buy the winner a drink at the bar? Is it legal representation on the line? Whatever the stakes may be, be sure to describe them clearly.
Rules of the Bet: Although not all bet agreements need rules, it may be preferable to implement a set of rules that will dictate how the bet is won or lost. For instance, if you are betting on a sports game, you may want to include a statement that makes it clear that the outcome of the game will be settled according to the official league rules.

Legal Aspects

As with many contracts, the enforceability of a bet agreement can depend on a variety of factors, including relevant state and federal laws, the existence of consideration, and the definition of gambling. Generally speaking, consideration refers to the idea that each party is "trading" something as part of the agreement; for example, a service provided now in exchange for money later. The existence of consideration is important because it potentially makes it more likely that a bet agreement (or any contract) will be treated as legally binding if challenged.
The enforceability of the bet agreement can also depend on how it is deemed to fit within legal definitions of gambling or illegal gambling. Legal gambling generally involves three specific elements: When gambling is involved, the specific ways in which consideration is exchanged can also be legally problematic for the bet agreement. Some states limit gambling between family members, and instead require games to use a dealer and two players to be present. The interest of the State in regulating that activity – usually for reasons related to fairness and preventing fraud – can sometimes take precedence over private regulations.

How to Create a Bet Agreement Template

Creating the template for your bet agreement is a fairly straightforward process. We’ve had enough experience in doing these that we know how to guide you through the process without leaving something important out, but you should be aware that this is a one way legal document that is not meant to be vigilantly one sided against one party. The more clauses and conditions you add to the agreement that the other party does not also have to comply with, the less likely that agreement is to stand up to scrutiny in a court of law.
When you sit down to do your agreement, make a list of all the terms you want clearly defined. Once you’ve got your list, you can take the time to either write the entire agreement yourself or hire a lawyer to do it for you. Having a lawyer create the agreement is generally the safest way to go, but you’ll be paying for that extra security. Remember that terms that might sound like common sense to you might be mistaken for something else by the person you’re making the agreement with, so it’s important to use clear and concise language at all times. You can also look at other bet agreement templates online to see about wording and talk to your lawyer about how to phrase the legal jargon. For instance, you might not be able to say "worth his salt" in a bet agreement as that implies that the other person has some value to them, and so won’t be applicable to any situation. It’s little things like this that could prove very important. Once you’ve got an agreement you’re happy with, you will need to sign that agreement. It’s important that both parties sign the same copy of the agreement, and then you each take a copy with you. If you’re making a long-term bet agreement, such as a multi-thousand-dollar bet, you might want to sign and counter-sign multiple copies.

Frequent Pitfalls in Bet Agreements

A typical mistake people make when preparing a bet agreement is a failure to provide that the bet is a legally enforceable debt. Obviously, if it is not a legally enforceable debt, it may be very difficult to have a judge or jury enforce your agreement. Thus, you should provide language in the bet agreement that indicates that the agreement is enforceable and is a legal debt.
Another common mistake is a failure to clearly define what is being bet on. For example, if your client is betting on who is going to win an election, it would be best to first define what election is as well as who has won that election before cashing the agreement .
In addition, many people mistakenly assume that the money they are placing as a bet is a legally enforceable debt. This is definitely not the case in many situations. If you are betting the money at a casino, the debt is generally thought to be legally enforceable. However, if you are betting a friend it could be more difficult to prove that the money is legally enforceable debt. In such a situation, it is often helpful to have a written agreement if only to counter the arguments of the loss that the money should not include in taxable income, but should instead be treated as a gift.

Options for Customizing Your Bet Agreement Template

When it comes to customizations, there are a lot of them that can be made to your bet agreement template. While the good news is that there’s quite literally no limit to what can be done, the bad news is that there’s no quick and easy way to do it. All forms of customization will cost you time and/or money.
The simplest and most effective customization is to add different provisions for different levels or types of betters. For example, you can define different terms for "Civilians" vs. "Players." Giving players a slight edge in the payouts might be just enough to get them to play. But make sure that the payout difference isn’t so extreme that it’s obvious to a civilian that he’s getting lesser value.
Another type of customization can be seen in the Microsoft Word doc that contains Example 7 "Wagering Rights". It can be particularly useful for campaigns with many players. It allows you to list the specific rights wagerers have to take a specific wager and you can even expire those rights. That means you can open the bet for wagering and allow wagerers to get in line for a position on the bet. Then, if you decide to lock the bet for wagers, all wagerers who tried to get in line got in line even if you never accepted their wager.
The final example is the payment clause – or maybe it’s just the liability clause. Here’s an example:
If I were to say: "Payable by either party using either $5,000 in 50 specific stocks at the higher of the high/low average price on the settlement date, or $5,000 cash using the minimum of the high/low average price on the settlement date." That’s unheard of. But I’d write it like this: Payment Windows. Let’s not get into specifics about cash or stocks. We have two windows during which either party can perform their obligations to pay. First, we have D Day, or the Declaratory Day. This occurs on the later of the day after the election determining the bet, or 15 days after either party invokes rights to make a claim. The second window is Settlement Day. This occurs on the later of the 15th day following D Day, or 30 days after either party invokes rights to make a claim. Each party has the sole right to determine and declare on what day its obligations to pay shall be performed, so long as that performance is completed during its window. No matter what we agree in advance, we’ll be able to decide, independently of each other, when we will perform, but no later than the deadline set forth above.

Bet Agreement Template Samples

Depending on the type of bet you and your friend want to make, the template of your bet agreement may differ. While there are no two bet agreements that are exactly alike, there are template options available to give you an idea of how to format your agreement. Below are just a few different types of agreements. If you’d like, you can download an example by clicking on the link under that type of bet agreement.
For a simple bet agreement, all you need is a few lines. You can simply agree to terms and reward as shown below:
Bet Agreement:
I, Betty, agree to pay my good friend James $50.00 (50 bucks) if the Chicago Cubs lose the first game of the 2017 regular season. I’ll pay in cash one day after the game.
There are many different aspects you might include when creating a bet agreement. However, sometimes you need something simple, like this agreement shown below:
BETTING AGREEMENT BETWEEN BETTY AND JAMES
BETTY and JAMES (collectively "PARTIES") agree to the terms as described below:
BETTING AMOUNT. BETTY agrees to give JAMES SEVENTY-FIVE DOLLARS ($75) paid in cash to JAMES on June 1, 2017.
LENGTH OF BET. This bet shall last until the 120th game of the 2017 regular season.
BETTING SPECIFICATIONS. This betting agreement shall be placed on the Chicago White Sox vs. New York Yankees match during the day of June 1, 2017. The ending score of this match-up shall be the betting agreement stake ("AGREEMENT").
VIOLATIONS OF AGREEMENT. If any of the PARTIES violate any of the terms of this AGREEMENT, and doing so will not damage the other PARTIES reputation, the following will occur:
As you can see from the templates above, the agreement will depend on the type of bet you and your friend agree to.

Conclusion: Significance of a Drafted Bet Agreement

This article has broken down the elements that go into a successful bet agreement template and how to customize your bet. It has covered the basics of betmaking, the background behind betmaking and how the courts have treated issues arising from wagers, and it has provided real-life examples of promises to pay and possible litigation scenarios. The wager has existed since time immemorial, and the need for a well-crafted bet agreement is as important today as it was in 1288 when the case of Casaubon v . Pichon was decided by the Parisian courts. However, in this year, the matter of gambling and the adjudication of gambling-related disputes can be judged not only within the court system but within the punitive realm of public opinion. And while bad faith disputes are always possible, having a well-documented bet agreement can spare you the time and monetary costs associated with litigation, and maybe even save you some face with your friends.