527 N.W.2d 20 | Mich. Ct. App. | 1994
INTERNATIONAL RECOVERY SYSTEMS, INC
v.
GABLER
Michigan Court of Appeals.
Nathanson & Nathanson, P.C. (by Leonard M. Nathanson and Keith M. Nathanson), for the plaintiff.
*50 Gerald Hale Ladue, for the defendant.
Before: MARILYN KELLY, P.J., and J.H. GILLIS[*] and M.D. SCHWARTZ,[**] JJ.
PER CURIAM.
Plaintiff, International Recovery Systems, Inc., appeals as of right from dismissal of its action seeking enforcement of a foreign judgment based upon an underlying gambling debt. We affirm.
I
Defendant, John Gabler, issued four checks to the Las Vegas Sands Hotel for $5,000. He used the sum to purchase gambling chips and ultimately dishonored the checks. The hotel assigned defendant's debt to plaintiff, which obtained a default judgment against defendant in a state court of Nevada on November 20, 1991. The judgment awarded plaintiff the amount of the debt plus interest and costs.
Plaintiff sought to enforce the judgment in the courts of our state under the Full Faith and Credit Clauses of the United States Constitution and the Uniform Foreign Money-Judgments Recognition Act. US Const, art IV, § 1; MCL 691.1151 et seq.; MSA 27.955(1) et seq.
Plaintiff moved for summary disposition pursuant to MCR 2.116(C)(9) and (10), and the trial judge found no cause of action against defendant. He reasoned that contracts made in furtherance of gambling are unenforceable as contrary to Michigan public policy.
Later, the judge agreed to reconsider his ruling *51 if plaintiff could present a Michigan appellate court case supporting enforcement of a foreign judgment based upon an underlying gambling debt. Plaintiff conceded that no such case law existed. The judge then denied the motion for reconsideration.
On appeal, plaintiff argues that the trial court erred in failing to render full faith and credit to the Nevada judgment.
II
A
We review a trial court's grant of summary disposition de novo, examining the record to determine whether the prevailing party was entitled to judgment as a matter of law. G & A Inc v Nahra, 204 Mich. App. 329, 330; 514 NW2d 255 (1994). MCL 691.1154(2); MSA 27.955(4)(2) provides:
A foreign judgment need not be recognized if:
(c) The cause of action on which the judgment is based is repugnant to the public policy of this state.
Courts in our state have long held that, as a matter of public policy, contracts made in furtherance of gambling are unenforceable, and loans made for gambling purposes cannot be recovered. Gibson v Martin, 308 Mich. 178; 13 NW2d 252 (1944); Raymond v Leavitt, 46 Mich. 447; 9 N.W. 525 (1881). The conclusion is amply supported by the language of MCL 600.2939(3); MSA 27A.2939(3), which provides:
All notes, bills, bonds, mortgages, or other securities or conveyances whatever, in which the whole or any part of the consideration, shall be for any *52 money or goods won by playing at cards, dice, or any other game whatever, or by betting on the sides or hands of such as are gaming, or by any betting or gaming whatever, or for reimbursing or repaying any moneys knowingly lent or advanced for any gaming or betting, shall be void and of no effect, as between the parties to the same, and as to all persons, except such as shall hold or claim under them in good faith, and without notice of the illegality of such contract or conveyance.
B
The viability of similar default judgments has been considered in the federal District Court for the Eastern District of Michigan on two separate occasions, in 1987 and 1990 respectively. Nat'l Recovery System v Kasle, 662 F Supp 139 (ED Mich, 1987); Boardwalk Regency Corp v Travelers Express Co, 745 F Supp 1266 (ED Mich, 1990).
In Kasle, the judge concluded that enforcement of a judgment based on a gambling debt did not violate Michigan public policy because: 1) otherwise the Michigan statute voiding gambling debts would be given an extraterritorial effect beyond that anticipated by the Legislature; 2) Michigan's interest in prohibiting a competent adult Michigan resident from voluntarily choosing to leave the state and wager in another state is minimal; 3) the facts did not indicate that Kasle was the victim of an illicit activity. The judge also reasoned that, as bingo and the state-run lottery are acceptable enterprises within the state, he could not conclude that gambling is morally and socially unacceptable here.
However, in Boardwalk, decided some three years later, a different judge again applied Michigan *53 law and came to the opposite conclusion: the courts of our state have long held that contracts made in furtherance of gambling were unenforceable, and loans made for gambling cannot be recovered. Gibson, supra; Raymond, supra. He denied plaintiff's request to honor stolen money orders that defendant signed in order to discharge a prior gambling debt and obtain gambling chips.
The Boardwalk court reasoned that MCL 600.2939(3); MSA 27A.2939(3) is the conclusive statement of Michigan public policy regarding the validity of gambling contracts or conveyances. Furthermore, it explicitly rejected the reasoning of Kasle, concluding that our Legislature has made limited exceptions to MCL 600.2939(3); MSA 27A.2939(3). Thus, Michigan does not prohibit "legal" gambling here or "legal" gambling in other states. However, that fact does not alter the explicit public policy statement against the enforcement of gambling debts set forth in the statute. Boardwalk, supra, p 1271.
Conclusions of the federal district court are not binding upon this Court. By contrast, public policy pronouncements of the Michigan Legislature enacted as statutes certainly do bind us. Lieberthal v Glens Falls Indemnity Co, 316 Mich. 37, 40; 24 NW2d 547 (1946). MCL 600.2939(3); MSA 27A.2939(3) renders gambling debts unenforceable as against public policy. Moreover, MCL 691.1154(2); MSA 27.955(4)(2) authorizes the court to refuse to enforce a foreign judgment which is repugnant to public policy.
Since enforcement of gambling debts is repugnant to Michigan public policy, the trial court correctly entered a judgment of no cause of action for defendant.
Affirmed.
NOTES
[*] Former Court of Appeals judge, sitting on the Court of Appeals by assignment pursuant to Administrative Order No. 1994-7.
[**] Circuit judge, sitting on the Court of Appeals by assignment.