Do I get this right, if you have not been caught, the ride would have been free? It is still essentially an honor system?
You are supposed to buy your ticket at a kiosk or if it's available a machine at the tram stop, if you are in a rush and jump on the tram, you can purchase a ticket from the driver when he stops.
Once you have your ticket you have to stick it in a machine on the tram to activate it.
It is the same procedure for the buses.
There are also monthly passes and student passes, they may work differently.
I remember an Irish gangster being caught not paying his ticket in Amsterdam and he was extradited back to Ireland, where he had several warrants for his arrest.
On a side note, the public transport in this country is marvellous, especially when compared to Ireland.