Hi @aphiso,

Yes, I think you got it! Liability is what you might lose when making a lay bet. If your lay bet wins, your profit is the backer's stake. No additional money changes hands. So, once you've won the lay bet your liability essentially becomes null, as you say.

"The odds were in favor of the backer so the larger profit goes to the lay?"
That's correct. If the odds had been 1.5, then the Backer's stake would have been 10 mBTC and the Layer's liability would have been 5 mBTC. In that case, the odds would be in favour of the layer, to use your expression.