*1 Argued petition 19, 1962, October reversed December rehearing January 23, denied
CUDD et al v. ASCHENBRENNER 2d 150
377 P. *2 argued Brown, Pass, L. Grants cause for Gene him the was R. appellants. With on brief Gene Smith, Pass. Grants argued Aschenbrenner, Grants Pass, A. the cause
L. respondent. him on the brief was William H. With for Ferguson, Pass. Grants Attorney Adams, Assistant General,
Harold W. Attorney argued cause behalf Salem, With, General as amicus curiae. him on the brief was Attorney Robert Y. Oregon, Thornton, General of Salem.
Before McAllister, Chief Justice, Rossman, Jus- Perry, Sloan, O’Connell, Goodwin Lusk, tices. J.
ROSSMAN, appeal by plaintiffs This is an from a decree ;by declaratory judgment entered the circuit court in a proceeding promotion which held scheme con- plaintiffs purpose attracting ducted grocery customers to two stores awas under provisions Oregon of ORS 167.405and XV, Article Constitution. The defendant is Mr. L. A. Aschenbren- attorney Josephine County. district ner, promotion program scheme which is in *3 weeHy “lucky essence a is known as draw,” “Strike it Anyone desiring Rich.” to do so enter one of using plaintiffs’ register. the stores scheme and obligation purchase. He under is no to make a The registrant telephone writes his name, address and paper provided given number therefor and is employеes pre- number. Prom this information store pare “registration one of card,” which is used drawing. registration, the actual at Also the time of given coupon participant upon signs is which he name. It his has numbers from 1 to 52 around edge. eligible In order to be for the cash award a coupon must have his “validated” each by having punched week one of the numbers out. Cou- pons may any be validated at the store at time and obligation, except coupons without that are not vali- Wednesday, day drawing dated on on which the place drawing each week on takes once held. The is adjoining person parking If the the store. lot present receives a cash drawn is he whose number is present he not at that at least If is award of $100. following award for the week amount of the time, jackpot to in- is allowed increased The $100. prize reaches crease until the $500. many stipulated parties of those register are of the store and make
who customers many registration. purchases Likewise, the time of at they persons purchases make at the time have their purchases pre- coupons axe not a validated. But registration requisite the validation or coupons. Oregon
Article XV Section 4 Constitu provides: tion lottery tickets, and the sale of for “Lotteries,
any purpose prohibited are and the whatsoever, assembly by penal legislative laws.” prevent shall the same legis- mandate, Pursuant constitutional says, part: lature enacted ORS 167.405which any “(1) Any person promotes up who or -sets any thing, or other valuable or any by way disposes property or means value, lottery, any way or or concerned in aids lottery, managing, drawing setting up, or such shed or or any building shop, who in house, boat, occupied by control, owned or him or under his management, knowingly permits setting up, ox any lottery any lottery, drawing or the sale of any writing, or token, of a tickets, ticket, share purporting intended to entitle the other device *4 any person, other to thereof, holder or bearer any prize to be drawn thereof, or interest or share any lottery, punished upon conviction shall be [*] # #
Clearly illegal Oregon. legislatures are lotteries But among generally, ours have been reluctant them, “lottery.” may define the term This reluctance be due precise “to the fact that a definition will enable in- genious 'unscrupulous persons plan and to devise some may which not be within the letter of the definition given scope but nevertheless is within the remedy.” the mischief which the law seeks to State (1959). v. Bussiere, 155 Me 331, A2d 702 “* * * techniques varied So have been the used by promoters joint prize, to conceal the factors of they chance and so consideration, clever applying techniques feigned been these as legitimate well as business that it has activities, apply often been difficult to the decision of one case to the facts of another.” FCC American Broadcasting Company, L 347US 98 Ed 699, 74 (1953). S Ct 593
In our .state the courts have been left decide what ease-by-case are schemes lotteries on a basis. lottery
The determination
what
constitutes
easy
is no
matter.
v. Schwemler,
State
154 Or
“any
P2d 938
whereby
defined a
scheme
thing
paying
or other valuable
one,
becomes entitled to receive from him such
another,
nothing,
a return in
as some formula of
value,
Accordingly,
determine.”
chance
this court has
accepted the almost universal formula that the three
prize,
elements of
chance and consideration are es
lottery.
any
It
sential to a
follows
the absence of
one of these elements removes the scheme from that
category.
County
Multnomah
Fair Association v.
(1932).
Langley,
P2d 354
277
present
very
given
“chance” are
in a
real
instance,
problem has
as to what
arisen
constitutes “considera
anti-lottery
purposes
for
tion”
statutes. In some
jurisdictions
principles
apply
ordinary
which
the
rigidly
been
contracts have
adhered to. Such courts
participation
by pa
have found mere
in the scheme
constituting
trons of the business as
consideration.
They
inconsequential
partici
have deemed it
that the
pants
required
pay nothing
were
of value for the
participate.
example, Lucky
chance
for
See,
Cal
(1955);
Cohen,
endar Co. v.
19
In which contrivances are lot duty it ascertain, teries is the the court to where possible, what authors of constitutional and lottery. statutory anti-lottery provisions deemed to be a arriving legislative In at RS 174.020. in O many factors must be considered such as the tention language object accomplished be and the used, history provision behind one of which is com —no controlling. Galloway, pletely Fox v. 174 Or (1944). it said in P2d 922 Thus was State Schwem ler, 154 Or P2d 938 that: lottery,’ “It settled that word as used state, the constitution of this has no technical, popular signification legal one different from the meaning generally given to be and the word is popular accepted time use at the when ** adopted constitution was antiquity, beginnings in had their Lotteries, Europe. American colonists America from came to extensively raising of funds used this method carrying governmental functions. In *6 operate were lotteries licenses to some instances lottery companies, private granted which conducted profit. lottery Per- own a business for their powerful haps of these was most famous Lottery. promoters made enormous Its Louisiana great expense participants. profits Their of its at the politics powerful gave on the influence them a wealth lottery Opponents it in- found of the state. creasingly influence. But to combat this difficult by gradually drain caused this financial the serious high of fraud in con- incidence and lotteries, other public depressions ducting led to and economic them, passed against agitation laws State after state them. disrepute. they prohibiting See, were in them 'Until Organized generally, and Law Enforcement, Crime (1952); Organized ABA Crime on Commission Obscenity in the Mails, and Frauds Thomas, Lotteries, Chapter page Laws and Lotteries, Williams, 1; I, page Chapter 28. Morals, II, goal important that the to our consideration It is popularly known as which were schemes, of these money directly raising from of was the “lotteries,” by participants. These con- made contributions invariably and were al- cash, were almost tributions participation ways prerequisite in the scheme. Encyclopedia in its sec- Volume 10, Britannica, The Wagering,” popular “Gaming on describes the tion “lottery” concept of a as follows: of the mechanics “* * * bearing are Tickets different numbers drawing. placed and date is set for On sale, up a date set device which contains num duplicates all bered the tickets and one sold, more are drawn at random. From the numbers money pro tickets, realized sаle of lottery prietors of the deduct some arbi amount, trarily expenses profits; determined, paid remainder is to the holders of tickets cor responding to those drawn.” many procedure.
There were variations this But essential to all of them was the contribution participants something which was of participation. economicvalue to as a them, condition possible concept It is not true obtain a what those who framed our constitution and statute considering conceived to be a without the evil they prohibition. Encyclo at which directed the pedia supra, desсribes that evil as Britannica, follows: principal charge against “The lotteries is that *7 they penalize poor, hope the who in ill-advised or desperation buy most of tickets; the Count Camillo
Benso Cavour called £a tax on imbeciles * * ? £ ?? appointed In 1808 the Government British a Select inquire Committee to into of the evils lotteries and the effect of the laws which had been instituted to regulate following quote them. We the discussion of report Participation from Williams, its Flexible Lot- (1938), page Chap. II, teries 5: many report “In the of committee, this instances arising were adduced of the most evils serious from people
lotteries. These included cases where liv- ing respectability in comfort and had been reduced abject speculations their most state of ‘the poverty quarrels, and distress’; eases of domestic family peace; of and the .ruin fathers assaults, deserting disgrace; falling their families want and into and neglecting
mothers their some- children, leaving robbing them wives their destitute; times earnings years; of months and husbands of pawning clothing, wedding and the of beds and rings indulge speculation. ‘In in order to other parents, cases children had robbed their servants masters; their suicides had been committed, imаgined every that can almost occasioned, crime be had been directly indirectly, through either or ” influence of lotteries.’ baneful abundantly description from It is clear this commonly attending “lotteries,” as that term was evils they speculation. that were result of understood, upon wagering by operation depended Their something monetary participants of or of they something win of value on the chance that would greater Supreme of value. Court Maine, far Thus, supra, Bussiere, v. said: State go along, the facts of this cannot under
“We
jurisdictions
that con-
which hold
case, with those
lottery,
with
оr
an element of
sideration
not
jurisdictions which hold that consideration
those
necessary,
anything consist
but
to the
or
benefit
is a
detriment
plan
promoter.
lacks one
defendant
We feel
all evil
the source of
element which is
gambling;
or
with lotteries
connected
risking
something
hazarding
person
value,
opportunity
hope
small, with
however
obtaining
larger
chance.”
sum
P2d 104
136 Mont
Cox,
In
State
said:
the court
of the Montana
the framers
our ¡mind,
“To
* * *
seeking
suppress
were
Constitution
*8
spirit
gambling
restrain
which is cultivated
whereby
by
and stimulated
schemes
one is induced
earnings
hope
large
his
to hazard
with the
win-
nings.
prohibit
which define and
The
lot-
.statutes
interpreted
pur-
be
teries must therefore
with this
* *
pose in mind
attempt
interpret
In this statement we concur. To
anti-lottery
considering
laws without
the circum
spawned
stances which
them would eviscerate the
legislative
legis
mandate that the
is to seek the
Court
attorney general’s
lature’s intent. The
brief informs
us that the New York
Code had substantial influence
legis
the framers of our constitution and on our
quote
history
lators. We
from discussion of the
anti-lottery
the New York
statutes in the
of In re
case
Dwyer,
Rep
14 Misc
204,
lottery is under the laws of this state. Our statutes concerning ginning early lotteries constitute from an be- legislation. subject a distinct line of * * * legal a has all literature its own. The debate over it in the constitutional convention of 1821 is interesting enlightening, and and forms and parcel legal literature of lotteries in this recurring state. No after one, to that discussion, any by can about what doubt was meant prohibition. word ‘lotteries’ in the The entire de- precise bate was conducted with and scientific reference state, lotteries then conducted prohibited private statute indi- * * *” viduals. and similar We have discussed those lotteries anti-lottery their evil effects. We have shown that the prevent impoverishment statutes were enacted of the individual and its attendant evils. Unless requires (1) participant part scheme with a *9 282 something (2) and the consideration be
consideration, participation of value to therein can economic him, purse his nor his accumulated rob him neither of worldly goods. that the conclude, We must therefore, anti-lottery provisions at of our statute are directed obligated participants to con which are schemes something to them tribute which is of economic value participation. a do as condition of We no violence lottery contracts hold that a to the law of when we generally greater contemplates a consideration than is required support Corbin, a contract. Professor page 1 discusses 'Contracts, 109, 346, Corbin on 'Sec. defining problem comes “consideration,” and following conclusion: “* * * reports all the can now read Who * * * dealing with law of consideration eases constructing laying the doctrines down Certainly of this ? not the writer volume. definitions merely enough of them feel well has read He enforcing informal that the reasons for assured many, promises doctrine of considera- are rightly many that no definition can doctrines, tion only up definition, as the one correct be set evolutionary is an law of contract and that ** changed product with time *.” has merely lottery special a a kind hold that We special requires kind a of considera- which contract impoverish can the indi- tion—consideration parts it. vidual who with holdings this since the enactment of court anti-lottery provisions are of our statute consistent Eggleston, 42 Quatsoe v. Or 71 this view.
with gambling “a (1903), as contract 66 defined P parties on the one side risk or more in which one greater, obtaining small the chance sum
283 * * winner or winners to be determined lot whereby “any paying money and scheme one, thing valuable becomes entitled another, to receive nothing, from him such a return in value, as some formula of chance determine.” This definition approved in National Association v. Crews, Thrift (1925), 241 P Or and in Schwemler, State v. supra. Olney, In United 1 Abbott, States v.
Judge Deady, in the convention which spoke framed the constitution of state, this as follows defining “lottery.” the word “ prizes ‘A distribution of and blanks chance; *10 game a in which hazard, small sums are ventured obtaining larger for the chance of a value either money in or other articles.’—Worcester’s Die.” “ gaming ‘A sort of contract, for a which, may by valuable one consideration, favor of the prize superior lot obtain a or poedia.” of a value to the amount Cyclo-
value of
which
that
he risks.’—American
McFadden v. Bain, 162
Or
“It is, if course, lawful, not resorted to a person give away device to evade the for a law, property by his lot or chance. The vice payment in of a consideration for the chance [*] [*] * J? language throughout
It will be noted that has “payment,” “money,” reference to a “.small ¡sum,” thing.” or “other valuable In each scheme which this lottery, court has declared to be a it has been careful monetary find consideration. That it has done holding present this warrants our in the case that consideration of some economic value must be exacted participant scrutiny of the if the scheme under tois lottery. be deemed a are aware of the substantial number of cases
We jurisdictions held to con- various fallacy trary. position in their in the lies mechani- preconceived “prize, application cal notions of attempting look chance without consideration,” concepts behind those words order to discover what convey. their users intended to Those' words were prefer interpret not to not written in a vacuum. We them in one. urges that even if it be conceded
The defendant lottery requires a consideration economic participant, present consideration is value to such participants in the case at bar because some of registering bought groceries they were for the while assumption upon the The contention ’based draw. groceries price paid was that paid compete the chance to as consideration for prize. immaterial that some He claims that it is groceries, participants bought and that no no ’buy. any obligated way He con paid person one taints cludes consideration category it into the and thus easts the whole scheme lottery. of a Gruninger, Philpot 20 L 14 Wall. Ed 743
In Supreme (US 1871), Court said: States the United *11 “* * * Nothing is not is consideration by parties. price regarded It is the such both as promisor’s undertaking. voluntarily paid for a *& opinion following of Mr. Jus quote from the the We Railway Michigan & in case of Wisconsin the
tice Holmes (1903): L Ed 48 229 370, 191 Powers, v. US o. C building and the of course at bar, “In the case a sufficient detriment operating railroad was of
385 change position to constitute a consideration or present. if the othеr elements were But the other promise elements are that the are the conventional and the detriment for
inducements each may matter other. No what the actual motive have by express implied terms of the con been, pur promise and the consideration must tract, port each for the in other, to be the motive whole # # *” part. or at in least City Mr. And in New Cardozo, Justice McGovern (1923), expressed York, 234 NY senti- same following ment in the words: “* * * ‘Nothing is it has been consideration,’ regarded parties’ ‘that is not such both
held, ** * presence The fortuitous in a transaction possibility unthought (cid:127)some 'latеnt but detriment, * * * enough promisee is not of, Promisor and must have dealt it with as the inducement to the * * * promise (Holmes p. Common Law, * * *” 309). p. Williston, Contracts, .Sec. 139, p. See also Corbin Contracts, Sec. Wil- 118, 364; p. liston on Contracts, Sec. 3rd ed. 100, 369, Section p. Corbin on follows: Contracts, “If the term ‘consideration’ is restricted to a ‘bargained-for equivalent given exchange promise,’ parties agree it is clear that must upon what it is. It is one of the elements of agreement mutually that must be assented to party order that there a be contract. If one offers to sell his car for a thousand dollars party says accepts price the other that he at the of nine hundred dollars, there is no contract. The parties reason that there is none is agreement expressed no as to the consideration promise to sell the car. in mak Therefore, ing be be called bargain, always such the consideration must expressed intelligible way. some It need not by any the name ‘consideration,’ specific agreed upon other but it must name; be *12 way agreement in some the must be evidenced satisfy the court.” that will foregoing that consideration It clear from the agreed parties something be which must important dis- becomes to be It therefore shall such. exactly agreement parties between the what the cover Eligi- promotional us entailed. device before to bility prizes depended upon the fulfillment for the prerequisites to the issues before us. three relevant appear participant at the had to store First, person registration. he had to 'Second, initial coupon appear validated each at the store to have his eligible prize. for a in which he wished to be week present parking personally on the he had to be Third, drawing. each of the store аt the time of To lot requirements, participant three who met these promised prize. a at the owner of the store chance bargain. It is clear were the elements of the Those in the that there is sufficient consideration fulfillment ordinary support an contract. of these conditions greater a we have shown that consideration is But lottery. necessary a constitute the scheme The de- purchase argument those who com- fendant’s paying the store are valuable considera- modities at neither fact that the .storeowners tion overlooks the making pur- particiрants nor the considered participation. prerequisite making chase a expressly by implication purchase nor neither bargain. And in the words of .of the Justice Car- presence quoted “The fortuitous in the above, dozo, possibility of of some latent detriment, transaction enough.” Viewing unthought not of, facts but analysis light gone which has of this ease that there was no we must conclude considera- before, passed from the to the owner tion before scheme sufficient constitute o£ the store lottery. aus *13 hasty reading, supra, upon Bain,
McFadden contrary the appear -one to view to subscribe reveals, the decision But in that as case, taken above. part and, theatre those who entered the drawing, participated paying had actu- in the audience ally purchased that the decision held tickets. they price paid for theatre tickets included which the drawing. By something participation in their the for they buying getting theatre inside the a ticket drawing. It is true that those who could watch the given par- tickets that enabled them to had been free though they ticipate drawing remained in the even possibly prize, the decision outside could win the but held, immaterial since those that that fact was who only paid the had not for their were inside theatre participation theatre but also for in the draw- tickets ing. lottery. As them held to be a the scheme was actually They parted in had with consideration money. supra, Bain, form of In McFadden v. the situ- language we ation as described in the new was quote from it:
“ * * not it So here test is whether was possible paying win for admission to without group is whether who did theatre. The test pay paying were for admission ” prized chance of assaying in mind in That fact must be borne de- night Bain bank cision. McFadden v. Thus, were in held a because those who the theatre only paid partеd not for their had with participation drawing. but also for admission remained outside had received their tickets Those who neighborhood. in the was made free when distribution No one of them conld enter the 'theatre unless the given number which had been to him free was declared lucky lucky number. If it was the number, presence holder had to enter the theatre in the purchased upon those who had stage walk tickets, prize. and receive the Some cases take note of the person usually strong fact that a compulsion feels a buy through a ticket rather than walk a crowd and being thought facе the embarrassment of a freeloader cheap purchased skate who those tickets. Possibly only very boys, paid nothing, small who have they prize feel like heroes when win a in the midst purchased of those who have tickets. We do not em- compulsion brace the rule and have no need to so; do pertinent but it is to take note of the fact that this scope. case does not fall even within its *14 every participant In the case now at bar is like those in McFadden v. Bain who remained outside the purchased theatre. anything None had a ticket or else. participants In fact, the in this case were even more favorably situated than those in McFadden v. Bain, everyone upon equal footing for since was an none could feel embarrassment if his number was called platform prize. and he walked to the to receive his purchased anything Whether he or not in 'the store was a matter for his individual choice. There was no compulsion upon him. Unlike the situation in Mc drawing place Bain Fadden v. where the took in a plaintiffs’ drawing place theatre, took outside plaintiffs’ open store. In park fact, it occurred in an lucky ing lot. The prize individual who received рut pocket, go spend it in could his home not a penny plaintiffs’ in the stores. money
Very likely the prize constitutes the groceries; present comes from the sale of pur- but for poses inquiry that is immaterial. The crucial is: did participant part any The with consideration. money spends chances are that whatever the store attracting to itself customers comes from the spend that the latter in the store. material fact The participant drawing analysis is that no in the under impoverished going drawing. can become to the nothing parts nothing. It costs him and he with implies Defendant in his brief that this method advertising plaintiffs’ competitors. unfair He congested vicinity also intimates that the traffic in the plaintiffs’ night drawing of the stores on the problems police causes force and is a nuisance. ques- While these contentions these merit, tions are not before us to decide. We are to deter- plaintiffs may criminally mine whether the be held anti-lottery conducting liable under our statute for the scheme which we have considered. We hold that they may not for the reason that the scheme is not a lottery under the laws of this state.
We state once more that no one could be rendered poоr participating plaintiffs’ drawings. in happen anyone worst that could would be that he buy groceries. purchased would some any, But, if he qualify he would not do so in order to himself aas drawing—for participation in the voluntarily. purchase free—'but His would not en- slightest degree hance in upon his chances drawings. Participation drawings in the could not gambling tendency. him a become for There was *15 anyone nothing improve could do that would his anyone prospects winning. parted If any with money upon plaintiffs’ premises, while the he did so solely purchase in purchased the of merchandise. If he anything, price did at he so the same as others who
290 drawings, pur- participate their in the
did not winning. upon In had effect his chances of chase no drawings participate in the it was not neces- order to anyone sary spend a nickel in the store or drawings any place. Tickets for the and tickets other (where drawing parking occurred) were lot the to the Anyone They who wished to not for sale. were .free. parking could enter the lot and free watch, do so place. charge, drawings promotional take This the drawing scheme a mere means of customers to the is possibly plaintiffs’ The latter devote some stores. advеrtising budget the of the of their creation lottery prizes. although prize The scheme is not a lottery It not a be- is distributed chance. any way no consideration which is in cause there is parts participant. harmful to the The with nothing any value to himself.
The decree of the circuit court is reversed.
concurring.
specially
O’OONNELL, J.,
majority.
I
in the
reached
I
concur
result
agree
opinion
pur-
not
do
with
distinguish
present
ports to
case from McFadden
(1939).
Bain, 162
In necessary lottery, a it is not “To constitute for pay participants for their chances, all sufficient but it is though many pay if do not a some do legal The effect valuable consideration. changed by not the fact that some transaction is pay. lottery do not If it is as to those who do those who do necessarily lottery pay, not as to it pay their for chances. supra was said v. Wall, “As Commonwealth * * game does not cease to be a
[3NE2d28],‘* many, players or even because some, long play so free, are admitted to tinue as others con- ('Citing authorities.) pay for their chances. possible not it the test is whether was So here paying for admission to the win .without theatre. group pay who did test is whether paying admission were chance of prize.’ Malloska, Mich. 216, also Glover 219, was
“See A. L. R. where the above 213 N. W. approval.” quoted with supra, opinion prop- my v. Bain, McFadden In disposition erly and controls the ease decided I dissent. at bar. in 'this dissent. concurs J.
Sloan,