Case ID: ny_56/html/0424-01.html
Source: Caselaw Access Project
Author: {"author": "Folger, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

David H. Hull, Appellant, v. Samuel H. Ruggles et al., Respondents.
    Where a pecuniary consideration is paid, and it is to be determined by lot or chance, according to some scheme held but to the public, what and how much he who pays the money is to receive for it, that is a lottery and falls within the prohibitions of the Revised Statutes (1R. S., 665, § 26) declaring every lottery, game, or device of chance in the nature of a lottery, unlawful.
    Plaintifi sold to defendants a quantity of candies and silverware; the candies were put up by plaintiif in packages known as “ prize candy packages; ” in some of the packages were tickets, each with the name of a piece of silverware upon it. The intent of the defendants was to sell the packages for more than the value, the purchaser taking the chance of getting a package containing a ticket; in which case he was entitled to the article of silverware named, in addition to the package. Held, that this was a lottery within the meaning of the statute; that the sale having been for the purpose of aiding in a lottery was void (1 R. S., 668, § 38), as was also the contract of sale, and that plaintiff could not recover.
    (Argued April 22, 1874;
    decided April 28, 1874.)
    
      Tracy v. Talmage (14 N. Y., 162) distinguished.
    Appeal from order of the General Term of the Supreme Court in the fourth judicial department, reversing a judgment in favor of plaintiff entered upon the report óf a referee and granting a new trial.
    The action was for goods sold and delivered. The defence was that the goods, which consisted of what is known as prize •candy packages with some articles of silverware, were intended to be used as a lottery, of which plaintiff had notice, and that he prepared the goods for that purpose.
    The referee found the following facts : That, on the 27th day of July, 1871, the defendants ordered of the plaintiff 300 packages of candy and sixty pieces of silverware, which the plaintiff delivered. The defendants promised to pay the plaintiff therefor the sum of seventy dollars on the 27th day of August, 1871 ; that sixty of said packages contained tickets, and each of said tickets had printed thereon the name of one of the said pieces of silverware; that said defendants disposed of said goods, or a part thereof, as follows : The packages of candy were exposed for sale with said silverware in view, and any person proposing to purchase one or more of said packages was informed that if he bought a package containing one of said tickets he would be entitled to the piece of silverware corresponding with the name on the ticket; that none of said tickets were visible, all being concealed in the packages; that in this manner the defendants sold a part of said packages of candy, and distributed a part of said articles of silverware ; that said candy and silverware together were worth the sum of seventy dollars, but that said packages of candy alone were not worth more than the sum of fifteen dollars; that the object of the defendants in so disposing of said goods was to sell said packages for more than their intrinsic value by offering to the purchaser thereof a chance in the distribution, by lot, of said silverware; that the plaintiff had reasonable cause to believe, when he sold said goods to the defendants, that they intended to use them in violation of the statutes against lotteries; and, as conclusions of law, he found that the bare knowledge of the plaintiff that the defendants intended to use said goods unlawfully is not sufficient to vitiate the contract of sale and render it illegal and void, and that the plaintiff was entitled to judgment.
    
      W. Sanders for the appellant.
    Mere knowledge on the part of plaintiff that the defendants intended to use the goods in an illegal manner was not sufficient to vitiate the contract of sale. (Tracy v. Talmadge, 14 N. Y., 162; Kneiss v. Seligman, 5 How., 425; affirmed, 8 Barb., 439.)
    
      Peter H. Van Auken for the respondents.
    The transaction was a lottery within the statutes. (Webster’s Dict.; Rees’ Cyclopedia; 12 Brewst. Ed. En., 258; Governors of Alms-house v. Am. Art. Union, 7 N. Y., 237; People v. Payne, 3 Den., 80.) The contract of sale is void and plaintiff cannot recover thereon. (2 R. S. [5th ed.], 929, 931; Rolfe v. Delmar, 7 Robt., 80; Hunt v. Knickerbracker, 5 J. R., 327.)
   Folger, J.

The Revised Statutes (1 R. S. p. 665, § 26) declare that every lottery, game, or device of chance in the nature of a lottery, by whatsoever name it may be called, other than such as have been authorized by law, shall be deemed unlawful. It must have been set on foot for the purpose of disposing of property. (Peoples. Payne, 3 Denio, 88.) It cannot be doubted, but that the purpose of the defendants, in contracting for the goods sold to them by the plaintiff, was to dispose of them to the public at more than their real value. This was to be effected, by the incitement and temptation held out to each purchaser, that while he paid more than the real value of the package that he bought, he also bought the chance of obtaining another article much exceeding in value the price paid. He would it is true get some real value, but so much less than the price that he paid, that he would not have been likely to pay that sum for it, but for the chance, and the hope excited by the chance, that he might also get therefor, another article of greater value than the amount paid. This was a lottery within the meaning of the statute. It was to set up 'chattels, to be distributed by lot, to any person who should have paid a valuable consideration for the chance of obtaining such chattels. (Id., § 1.) It was a lottery, or device of chance in the nature of a lottery. (§ 26.) It is directly within the definition of Worcester: “A hazard in which sums are ventured for the chance of obtaining a greater value.”

Where a pecuniary consideration is paid, and it is determined by lot or chance, according to some scheme held out to the public, what and how much he who pays the money is to have for it, that is a lottery. (State v. Clarke, 33 N. H., 329; Governors, etc., v. Am. Art Union, 7 N. Y., 228.) It was unauthorized by law. It therefore fell within the prohibition of the statute. (§ 26.)

How is there any doubt, but that the plaintiff sold and delivered the goods to the defendants that they might be thus disposed of? The referee finds, that they were so put ‘ up by the plaintiff as that each package of lesser value either had concealed in it a ticket, or had in it no ticket, on which was the name of some one of the articles of greater value; that these packages of lesser value were exposed for sale with the packages of greater value in view; that each purchaser of a package of lesser value was made to know, before his purchase was made by him, that if he by chance got a package in which was concealed a ticket, he was also entitled to an article from those of greater value, which was named upon that ticket. The referee also finds, that the plaintiff had reasonable cause to believe, that when he sold the goods to the defendants, they intended to use them in violation of the statutes against lotteries. Upon these findings of fact, liis judgment for the plaintiff cannot he sustained, unless he is right in his conclusion of law : “ That the bare knowledge of the plaintiff that the defendants intended to use said goods unlawfully is not sufficient to vitiate the contract of sale, and render it illegal and void.”

We are not left to the rules of the common law alone, to determine whether this conclusion of law is correct. The statutes against lotteries have provisions touching the subject. Section 38 of the Revised Statutes above cited (1 R. S., 668, § 38) declares that every sale of any goods, for the purpose of aiding in a lottery, is void and of no effect. It is difficult to perceive how a sale of goods so packed and arranged as to enable the purchaser, without alteration or readjustment of them, to carry out a scheme, which'when accomplished is an unlawful lottery; and sold thus with knowledge, or with reasonable cause for belief, that the purchaser by the disposal to the public of the goods thus arranged intended to violate the statutes against lotteries, is not a sale for the purpose of aiding in such lottery. It cannot be otherwise. The sale by the plaintiff to the defendants was to aid in carrying on an unlawful lottery, and was void. ' As the sale was unlawful and void, the contract of sale was. the same and cannot be enforced. It is in violation of a penal and prohibitory statute, and the court cannot .lend the aid of the law to carry it out and enforce it in favor of a party to it.

Nor does this conclusion rest alone upon the prohibition of section 38 above cited. The plaintiff cites, as an authority in his favor, Tracy v. Talmage (14 N. Y., 162). That case does hold, that mere knowledge by the vendor, that the purchaser intends to make an unlawful use of the property, is not a defence to an action for its price That is perhaps all that was necessary to decide in that case, for the determination of the questions there involved. But it is also said there, that if the vendor, with knowledge of the intent of the purchaser, do anything beyond making the sale, to aid or further the unlawful design, he cannot recover for the property. And in the opinion given there, are cited the not unfamiliar English cases, in which it is held, that if goods be bought with the purpose of smuggling them into' England, though the vendor have knowledge of the purpose, he may recover the price of the goods, if he do nothing to aid in carrying out the design (Holman v. Johnson, Cowp., 341); but if he has so packed the goods as to facilitate the smuggling, he is regarded as particeps eriminis and cannot recover. (Biggs v. Lawrence, 3 T. R., 454; Clugas v. Penaluna, 4 id., 466; Waymell v. Reed, 5 id., 599.)

The acts of the plaintiff bring him within the principle established by those authorities. We know of no authority in this State which is in conflict with that principle. '

The order appealed from should be affirmed and judgment rendered for defendants on the stipulation.

All concur.

Order affirmed and judgment accordingly.