Horner v. United States
delivered the opinion of the court.
This is an indictment found May 16, 1892, in the Circuit Court of the United States for the Southern District of New York, founded on § 8894 of the Revised Statutes, as amended by the act of September 19, 1890, c. 908, 26 Stat. 465.. The section, as so amended, reads as follows: “ No letter, postal card or circular concerning any lottery, so-called gift concert,
Section 3894, as originally enacted in 1874, was an embodiment of § 149 of the act of June 8, 1872, c. 335, 17 Stat. 302, and read as follows:
“
Sec. 3894. No letter or circular concerning illegal lotteries, so-called gift concerts, or other similar enterprises, offering prizes, or concerning schemes devised and intended, to deceive and defraud the public for the purpose of
The present indictment contains two counts. The first count alleges that Edward H. Horner, on December 29, 1891, did unlawfully and knowingly cause to be deposited in the post office at the city of New York, in the Southern District of New York, a certain circular to be conveyed and delivered by mail, “ which said circular in the contents thereof, hereinafter set forth, concerned a lottery, and which was then and there addressed to Joseph Ehrman, 70 Dearborn Street, Chicago, Illinois, and was enclosed in an envelope with postage thereon prepaid and carried by mail, and which said circular contained, among other things, the following, to wit: ” as is set forth in the margin, with the rest of said count.
1
The second count
After the prosecution had rested, the counsel for the defendant moved the court to direct the jury to acquit, on the following grounds: (1) The defendant is not shown by the evidence to have committed any offence against any statute law of the United States or against the common law; (2) The circular, with causing the mailing whereof the defendant is charged in this prosecution, is not a matter prohibited under section 3894 of the Revised Statutes; (3) Said circular does not concern or relate to a lottery, so-called gift concert or similar enterprise offering prizes depending upon lot or chance, or concerning schemes devised for obtaining money or property under false pretences, nor does the same concern or relate to a lottery or similar- scheme or a lottery ticket or part thereof; (4) That the bond or bonds mentioned in said circular which have been proved herein are not a lottery, so-called gift concert, or similar enterprise offering prizes depending upon lot or chance, or concerning schemes devised for the purpose of obtaining money or property under false pretences, nor are the same a lottery or similar scheme or lottery ticket or part théreof; (5) That the bond or bonds mentioned in the indictment, and proved upon the trial herein, are government bonds issued by the Empire of Austria, and not within the language, meaning or purview of the statute for any violation of which the said Edward H. Horner, the defendant, has been charged herein. The counsel for the defendant also moved that the prosécútion be dismissed' on the same grounds severally as above enumerated. The court denied each of those motions, and the counsel for the defendant took, and was duly allowed, exceptions to such denials.
The, Circuit Court of Appeals, on the 31st of October, 1892, pursuant to § 6 of the act of March 3, 1891, c. 517, 26 Stat. 828, certified to this court the following questions or propositions of law, concerning which it desired the instructions of this court for its proper decision: “ (1) Do the bonds mentioned and described in the first and second counts of the indictment herein represent a ‘ lqttery or similar scheme ’ within the meaning of section thirty-eight hundred and ninety-four of the Eevised. Statutes of the United States? (2) Is the circular described and set forth in the first and second counts of the indictment herein a
‘
circular concerning any lottery, so-called gift concert or other similar enterprise offering prizes dependent upon lot or chance ’ within the meaning of section thirty-eight hundred and ninety-four of the Eevised Statutes of the United States? (3) Does th¿ circular mentioned and set forth in the first and second counts of the indictment herein consti-' tute a ‘ list of the drawings at any lottery or similar scheme ’
It is contended on behalf of Horner that it is not a proper' test to apply to the government bonds in question, whether or not they have an element of chance in them; that the test ought to be, whether they are a “ lottery or similar scheme; ” that they are not a “ lottery or similar scheme; ” and that ‘all the questions certified should be answered in the negative.
. It is urged that all the bonds are to be redeemed within fifty-five years from the date of their issue; that during the first year the Austrian government agrees to pay, as the minimum amount for any bond redeemed, 135 gulden; during the second year, 140 gulden; during the third year, 145 gulden; and so on, increasing 5 gulden in amount each year, until the minimum amount to be paid by the government on each bond redeemed is 200 gulden; that the primal object is only to raise money to carry on the government; that the money received by the government upon the bonds is not used as a fund out of which to pay prizes or to repay the loan; that the money for such purposes is raised by taxation and the usual means of raising revenue; that the bonds were issued in 1864, many years prior to the enactment of the original statute of the United States, which was passed in 1812; and that, as the government loan in question has for its primary object a.loan, it is not transformed into a lottery because it has attached, as a subsidiary feature, an element which is like that of a lottery, in the distribution by lot.or chance of certain larger premiums or awards.
But we are of opinion that the scheme in question falls within the inhibition of § 3894, as amended. The denunciation of that section is no longer against sending by mail a circular concerning an “ illegal-”Tottery, but is against mailing a “circular concerning any lottery, so-called gift-concert, or other similar enterprise offering prizes dependent upon lot or chance.”
Each “ premium bond ” states that the 100 florins ■ is a “ share of the loan of forty million florins,” for which will be paid to the bearer “ the amount resulting according to the
Under the plan, other and larger amounts aré provided to be paid on certain of the bonds, to be determined by the drawings, namely,.during the first year, on one bond, 250,000 gulden; on one, 25,000 gulden; on one, 15,000 gulden; on one, 10,000 gulden; on each of two bonds, 5000 gulden; on each of three, 2000 gulden; on each of six, 1000 gulden; on each of fifteen, 500 gulden ; and on each of thirty,' 400 gulden.
The first .count further alleges that during subsequent periods other provision is. made for such larger amounts ; that all of the bonds are in the same form, have the same drawing
In the Century Dictionary, under the word “lottery,” is the following definition : “ A scheme for raising money by selling chances to share in a distribution of prizes ; more specifically, a scheme for the distribution of prizes by chance among persons purchasing tickets, the correspondingly numbered slips or lots, representing prizes or blanks, being drawn from a wheel on a day previously announced in connection with the scheme of intended prizes; In law the term lottery embraces all schemes for the distribution of prizes by chance, such as policy-playing, gift-exhibitions, prize-concerts, raffles at fairs, etc., and includes various forms of gambling. Most of the governments of the continent of Europe have at different periods raised money for public purposes by means of lotteries; and a small sum was raised in America during the Revolution by a lottery authorized by the Continental Congress. Both State and private lotteries. have been forbidden by law in Great Britain and in nearly all of the United States, Louisiana and Kentucky being the two notable exceptions.” . Under that definition, the circular in question had reference to a lottery.
In Webster’s Dictionary, “lottery” is defined as “A distribution of prizes by lot or chance.”
In the Imperial Dictionary, the word is defined thus: “Allotment or distribution of anything by fate or chance; a procedure or scheme for the distribution of prizes by lot; the drawing of lots. In general, lotteries consist of a certain number of'tickets drawn at the same time, some of which entitle the holders to prizes, while the rest are blanks. This species of gaming has been resorted to at different periods by most of the European governments, as a means of raising money for public purposes.”
. Although the transaction in question was an' attempt by Austria to obtain a loan of money to be put into her treasury, it is quite evident that she undertook to assist her credit by an appeal to the cupidity of those who had money. So she offered to every holder of a 100-florin' bond, if it was redeemed during 'the first year, 135 florins, if during the second year, 140 florins, and so on, with an increase of 5 florins, each year, until the sum should reach 200 florins; ,'and she also offered to the holder, as part of the bond, a chance of drawing á prize varying in amount from 400 florins to 250,000 florins. Every holder of a bond has an equal chance with the holder of every other bond of drawing one of such prizes. Whoever purchases one of the bonds, purchases a chance in a lottery, or, within the language of the statute, an “enterprise offering prizes dependent upon lot or chance.”. The element of certainty goes hand in hand with the element of lot or chance, and the former does not destroy the existence or effect of the latter. What is called in the statute a “so-called gift concert” has in it an element of certainty and also an element of chance; and the transaction embodied in the bond in question is a “ similar enterprise” to lotteries and gift concerts. ' " ■
In
United States
v.
Zeisler,
30 Fed. Rep. 499, the Circuit
In
Ballock
v.
State,
In
Long
v.
State,
In
Cohens
v.
Virginia,
As to what have been held to be lottery tickets by the courts of the several States, reference may be made to
Commonwealth
v. Chubb, in the General Court of Virginia, 5 Randolph, 715;
Dunn
v.
The
People, 40 Illinois, 465, where it was held that the character of the transaction would not be changed by assuming that the ticket represented an article of merchandise 'intrinsically worth the amount which the holder would be obliged to pay, and that if every ticket in any ordinary lottery represented a prize of same value, yet if those prizes were of unequal values, the scheme of distribution would still remain a lottery;
Thomas
v.
The
People, 59 Illinois, 160, where a ticket was a receipt for money in payment for the delivery of a copy of an engraving, and for admission to certain concerts and lectures, for which it was sold, and money was tó be distributed in presents amounting to a certain number, to the purchasers of engravings, and it was held that that was a scheme for the distribution of prizes by chance, and constituted a lottery, it being apparent that some of the purchasers would fail to receive a prize, and that even if the ticket to the concerts and lectures, and the engraving, were.-intrinsically worth the price paid, the scheme would still be a lottery;
Chavannah
v.
The
State, 49 Alabama, 396, where it was held that the venturing of a small sum of money for. the chance of obtaining a greater sum was a lottery;
Commonwealth
v.
The Sheriff,
Cases in England are to the same effect. In Reg. v. Harris, 10 Cox’s C. C. 352, it was held that a lottery in which - tickets -were drawn by subscribers of a shilling, which entitled them at all events to what purported to be of the value of a shilling, and also to the chance of a greater value than a shilling, was an illegal lottery within, the statute. In Sykes v. Beadon, 11 Ch. D. 170, 190, there were holders of certificates, who subscribed money to be invested in funds which were to be divided amongst them by lot, and divided unequally, that is, those who got the benefit of the drawings got a bond bearing interest ■and a bonus, which gave them different advantages from the persons whose certificates were not drawn; and it depended upon chance, who got the greater or the lesser advantage. The scheme was held to be a subscription by a number of persons to a fund for the purpose of dividing that fund among them by chance, and unequally; and Sir George Jessel, Master of the Rolls, characterized the scheme as a lottery. In Taylor v. Smetten, 11 Q. B. D. 207, packets were sold, each containing a pound of tea, at so much a packet. In each packet was a coupon entitling the purchaser to a prize, and that fact was stated publicly by the seller before the sale, but the purchasers did not know until after the sale what prizes they were entitled to, and the prizes varied in character and value. The tea was good and worth the money paid for it. It was held that the transaction constituted a lottery, within the meaning of the statute.
■ The onty case of importance to the contrary is that of
Kohn
v.
Koehler,
At the special term of the Supreme Court, the defendant had a judgment in his favor, which was reversed by an order of the general term.
It is to be noted that the New York statute under which the action-referred to ivas brought, ivas1 aimed against a share or interest'in an “ illegal’’lottery. The act of Congress of 'June 8, 1872,-now § 3894 of the Revised Statutes, as originally enacted, condemning only “illegal” lotteries, was amended by the act of. September 19, 1890, so as to cover “ any lottery, so-called-gift concert, or other similar enterprise offering prizes dependent upon lot or chance.” As the New York statdhe contained the word “illegal,’.’ it may be that the Court of Appeals gave force to .the view that the Austrian loan was a legal lottery, from the fact that-it dwelt so largely on the idea that the bonds were issued by the' Austrian government, in accordance with its laws, for the purpose of obtaining a loan of money, in connection with the further facts stated by it; that like bonds had been issued by several governments of other countries, and that the-bond in question was ah evidence óf debt and a public security of a foreign government, exposed for sale in the same manner as other securities upon which money is loaned. : It by no means follows that the Court of Appeals would have made a like decision on a statute with language in it like that of § 3894. • •
The case of Ex parte Shorbet, 70 California, 632, merely followed the ruling in Kohn v. Koehler, supr a.
- The question whether the tranéactioh covered by this indictment was ah' offence against § 3894, was sought to be raised in the case of
Horner
v.
United States,
No. 2, (
The three questions certified must each of them be answered in the affirmative, and it is so ordered.
Notes
“ Banking-house of E. H. Horner, No. 88 Wall Street.
“New York, December 27, 1890. ' “ 110th redemption, December 1st, 1890, at. Wien. The following 26 series wrere called in.
“ Payment on and after March 1, 1891.
“ The next report of redemption will be published in the second half of 'the month of January, 1891.
“ Customers who have been notified by special letter of the redemption of \their bonds, can cash the respective amounts at my office.”
That the said words and figures of the said circular relate to and concern certain so-called bonds issued by the Empire of Austria, and state on which of said so-called bonds payments were to be made and. the amount thereof, a translation of the face of one of such bonds, so called, being as follows, to wit:
“ Series 921. 100 florins. Number 60.
“Premium Bonds.
“ One hundred florins, Austrian standard, as share of the loan of forty million florins, Austrian standard, made according to the law of November 17, 1868, (Law Journal of the Empire, No. 98,) for which the amount resulting according to the plan of redemption will be paid to the bearer by the Universal State Loan'Treasury.
■ “ Vienna, February 11, 1861.
“(Signed) Joseph Rudde,
“Imperial Boyal Minister Counsellor.
“ [Coat of Arms.] Pjoener,
“Imperial Boyal Minister of Justice.
“ For the board for controlling the State loans:
“(Signed) , Collerdo Mannsfeldt.
“(Signed) Winterstein.
“ For the Imperial Eoyal Universal State Loan Treasury:
* ‘ (Signed) Winter.
f‘ (Signed) Schimkowsicy.”
Each of said so-called bonds having upon its.face a series number and a number in the series, the amount of indebtedness which each of said so-called bonds purports to evidence being one hundred florins, the plan of drawing set forth on the back of each of said so-called bonds showing that up to April, 1871, there were to take place five drawings a year, on dates therein mentioned, to determine on which of the so-called bonds payments should be made, and the amounts of such payments, and that thereafter and until the end of the nineteenth year after the date of the .issue of the so-called bonds, four drawings per year were to take place at stated dates for the same purpose, and that thereafter to and including the thirty-first year, three drawings were to take place for the same purpose at fixed dates
On one bond............................................. 230,000 gulden
On one bond............................................. 25,000 gulden
On one bond............................................. 15,000 gulden'
On one bond............................................. 10,000 gulden
On 2 bonds, each at 5000 gulden...................-........ 10,000 gulden
On 3 bonds, each at 2000 gulden........................... 6,000 gulden
On 6 bonds, each at 1000 gulden.................. 6,000 gulden
On 15 bonds, each at 500 gulden........................... 7,500 gulden
On 30'bonds, each at 400 gulden.....................'...... 12,000 gulden
And during subsequent periods other provision being made for such large amounts, all of said so-called bonds being in the same form as said copy translation and. having the same drawing and redemption plan endorsed upon them and being identical in all respects, except that the series numbers and the number thereof vary as to each so-called bond, all of the drawings heretofore referred to by which, first, are determined the,series of the so-called bonds to be paid or redeemed in each year, and, second, are determined the particular bonds in the series whose holders shall be entitled to the larger sums aforesaid, the numbers of which are drawn from the wheel, being conducted in such a way as that, the determination of the numbers, both for redemption and for amounts, is wholly by lot or chance, the holder of each so-called bond having an equal chance with the holder of every other so-called bond, first, in securing an early payment of his so-called bond, and, second, in securing as a so-called payment for his so-called bond the very large prizes to which reference has been hereinabove made, the result in each case, as before alleged, being dependent wholly on .lot or chance.