Contract Questions to Ask Before You Start a Lottery Pool Group

We at PlayUSALotteries don’t involve ourselves with any syndicates or lottery pools but many players like to create their own lottery pool as it is an effective way to increase your odds of winning a jackpot without having to spend any additional money. It also seems to raise morale in the workplace or allows neighbours to become closer together and give them all something in common to talk about. That said, things can sometimes become a bit tricky and can cause hard feelings so it is always a good idea to have a contract for your lottery pool. All it will do is to outline the way that the pool is controlled and run and make sure that every member of the pool is on the same page and is aware of what to expect. 

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Lottery Pool Contract

The Lottery Pool Contract doesn’t have to be too formal as the idea is to be sure that all involved are aware and understand and agree to a certain set of rules. It ticks the box and helps avoid any problems with the lottery pool such as lawsuits or just hurt feelings. Before you create this legal document, you need to get the correct information that is needed and a Lottery Pool Manager needs to be put in place and be in charge of the pool. The Lottery Pool Manager can delegate some of the work involved but is the person to contact if there are any concerns or questions. They have to make sure that all participants have a copy of the contract and they also have to keep track of the signed copies plus make the decisions such as where to keep the tickets that have been bought and who should be delegated to buy the tickets each week.

It should be decided when tickets should be purchased as some lottery pools like to buy on a regular schedule such as once a week or even once a month. Other pools just buy tickets once the jackpot has reached a certain value and some pools are valid for a single draw then change things such as when there is an interesting lottery draw such as one with a big jackpot win when it comes up. The Lottery Pool Agreement needs to specify which draws will be covered and should also include any of the lottery games the pool will play and the specific draws that will be participated in.

Lottery pool members

Before the contract is created, you need to know who all the pool members that participate will be, as should the group win the lottery jackpot, there will be some that regret not participating and could try to make things difficult for the other members of the group. The contract will stop this sort of thing happening. The players are either in via the contract or out altogether with no argument. Certain coworkers have sued winners and claimed that they were excluded unfairly from participating in a pool that won a jackpot. So it is vital to be sure to record who will be invited to play and how others can find out all about the lottery pool.

Included in the Lottery Pool Agreement should be whether and when new players can join the pool and whether players can pick and choose which draws they want to be included in and pass on others. Some lottery pools will allow members to invest more money into the pot for a bigger share of the prize money if they win. For example, if a single lottery ticket costs $2, a member can up his investment to say $10 into the pot to be able to receive five shares of the jackpot prize money. The pool will purchase five extra tickets which would raise everybody’s odds of a win.

More often than not, other lottery pools prefer to keep things simple with an even split where all members put in the same amount of money and share the winnings evenly in the case of a win. Your lottery pool contract should outline exactly how the jackpot will be split.

When it comes to choosing the numbers that will be played within the pool, there are two different ways for them to be chosen. Firstly you can let the computer randomly choose the numbers or you can pick the numbers yourselves. It must then be agreed which method the lottery pool will choose. The easiest option is to let the computer choose the numbers randomly. If it’s agreed that some members want to use their own numbers to play with, it will need to be specified how and by whom the numbers are chosen. If that option is taken, you may want to have in the pool contract to waive responsibility if the person choosing the numbers and buying the tickets chooses the wrong numbers. There would be a bit of an uproar if the right numbers would’ve come up and won.

Winning the jackpot as a pool

The target for everyone in the lottery pool is to win the jackpot prize but it is far likelier that smaller prizes will be won. So what happens with the smaller prizes your lottery pool wins? Your Lottery Pool Contract should state clearly what will happen to the lower tier prizes. The prize can be shared among all participants no matter how small they are or the money can be put towards buying tickets for another lottery draw. You can also choose to give small amounts to charity or to buying tea and coffee for the office or save the money until there is enough for a group lunch somewhere.

Of course if you do choose to add the money towards the next lottery draw, it must be pointed out that only those that contributed to participate in the next draw will reap the benefit. For instance, if this week your pool of twenty people wins $5, that $5 is added towards the following week’s draw. If in the following week’s draw only fifteen people participate with each putting in $2 to buy a ticket, this would mean only the fifteen participating players would have the chance to win in the new draw. Even though twenty tickets are actually bought, the fifteen will split any prize money fifteen ways. The lottery agreement should not only say what to do with any small prizes, but what the cut-off for a small prize should be. It could be anything from $5 to $1000?

How about a scenario where you’re part of a lottery pool and you find out the pool manager has won the jackpot but refuses to share the winnings? Why would he not share? He says that he bought the winning ticket privately and not with the lottery pool’s money. This sort of thing has happened in the past and has resulted in bitterness. To avoid this happening, make sure the Lottery Pool Contract states whether any participants including the person in charge of buying the tickets for the whole group, can buy lottery tickets outside of the lottery pool as well. Should your contract allow members of the pool to buy lottery tickets privately, make sure to make copies of the group’s tickets making sure that it’s clear which tickets belong to the lottery pool? It should be done as a matter of course anyway and each member should get a copy of the tickets.

Let’s assume the lottery pool wins a huge jackpot, it must be decided whether to take the lump sum option straight away or take the annuity spreading the prize money over a number of years. The best idea is to decide this before anything is won and put it into the Lottery Pool Contract to avoid any argument over the answer if the pool actually won. The favourite option historically is the lump sum option as it allows access to a large sum immediately.

Remaining anonymous

The big question is often will it be possible for the lottery pool to remain anonymous if you win? A few of the states allow lottery winners to stay anonymous once they have won the jackpot which helps the winners to avoid any negatives that seem to happen after a big win. Players often end up losing friends who become jealous or having reporters swarming all over your house for an interview or being overwhelmed with people asking for handouts. It is a lot harder to keep your identity private if some of the pool members aren’t bothered about the publicity. To avoid this scenario, it is best if once everyone has agreed to remain anonymous or announce their lottery win and they are in a state that allows anonymity, then it should be added to the Lottery Pool Contract.

This article is not supposed to be a fully comprehensive list of every issue that needs to be covered in a Lottery Pool Contract but rather to encourage a discussion of the goals of your lottery pool group. When legal advice is required, you should always consult a professional lawyer who is familiar with this type of contract. If a legal document is drafted, it is important that all members of the pool read it and understand it properly then have each member sign it. It is prudent to have a third party who can witness the signatures especially if they are a notary and the Lottery Pool manager should keep all of the copies safe.

It’s a good idea to check out any state laws that may or may not influence the Lottery Pool Agreement as in some places like your state or your company or your region may prohibit any lottery pools. It is worth talking to your company’s HR or legal departments if you’re not sure whether they allow a lottery pool or not.

We hope this has been a little helpful to you and wish you or your lottery pool good luck with your next draw.

 

 



This post was written by
Jason L - who has written 3106 articles
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