IN THE SUPREME COURT OF MISSISSIPPI

NO. 97-SA-01621-SCT

MISSISSIPPI GAMING COMMISSION AND THE MAYOR AND ALDERMEN OF THE

CITY OF VICKSBURG, MISSISSIPPI

v.

E. L. PENNEBAKER, JR., AND HORSESHOE GAMING, INC.

DATE OF JUDGMENT: 12/16/1997

TRIAL JUDGE: HON. L. BRELAND HILBURN

COURT FROM WHICH APPEALED: HINDS COUNTY CIRCUIT COURT

ATTORNEYS FOR APPELLANTS: OFFICE OF THE ATTORNEY GENERAL

BY: CHARLENE R. PIERCE

R. STEWART SMITH

JOAN MYERS

NANCY DAVIS THOMAS

WALTERINE LANGFORD

ATTORNEYS FOR APPELLEES: WILLIAM E. SPELL

SCOTT E. ANDRESS

BEN HARRY STONE

NATURE OF THE CASE: CIVIL - STATE BOARDS AND AGENCIES

DISPOSITION: REVERSED AND RENDERED- 06/06/2002

MOTION FOR REHEARING FILED: 6/20/2002; denied 9/5/2002

MANDATE ISSUED: 9/12/2002

CONSOLIDATED WITH

NO. 1998-SA-01077-SCT
THE MAYOR AND ALDERMEN OF THE CITY OF VICKSBURG, MISSISSIPPI,

MISSISSIPPI GAMING COMMISSION, RIVERBOAT CORPORATION OF MISSISSIPPI --

VICKSBURG, AMERISTAR CASINO VICKSBURG, INC., AND HARRAH'S CASINO

v.

E. L. PENNEBAKER, JR., AND HORSESHOE GAMING, INC.

DATE OF JUDGMENT: 6/12/1998

TRIAL JUDGE: HON. L. BRELAND HILBURN

COURT FROM WHICH APPEALED: HINDS COUNTY CIRCUIT COURT

ATTORNEYS FOR APPELLANTS: NANCY DAVIS THOMAS

WALTERINE LANGFORD

CHARLENE R. PIERCE

R. STEWART SMITH

JOAN MYERS

JANE W. CRAIG

DAN M. McDANIEL

R. SCOTT LEVANWAY

DANIEL G. HISE

ATTORNEYS FOR APPELLEES: WILLIAM E. SPELL

SCOTT E. ANDRESS

BEN HARRY STONE

NATURE OF THE CASE: CIVIL - STATE BOARDS AND AGENCIES

DISPOSITION: REVERSED AND RENDERED- 06/06/2002

MOTION FOR REHEARING FILED:

MANDATE ISSUED:

EN BANC.

COBB, JUSTICE, FOR THE COURT:
¶1. Horseshoe Gaming, Inc. (Horseshoe) sought approval of a gaming site on the Big Black River in

Warren County, Mississippi. The Mississippi Gaming Commission (the Commission) determined that the

site was not suitable for gaming. E.L. Pennebaker, Jr., who claimed he owned real property adjacent to the

proposed site, filed an appeal from that decision, as an "aggrieved person", in the Hinds County Circuit

Court, Second Judicial District. Horseshoe later intervened. The circuit court reversed the Commission's

decision, finding that the decision of the Commission was arbitrary and capricious. The Commission, the

City of Vicksburg (the City), and three of the Vicksburg casinos, Riverboat Corporation of MississippiVicksburg, Ameristar Casino Vicksburg, Inc., and Harrah's Casino, (the Casinos) appeal(1) asserting

numerous assignments of error committed by the circuit court, which have been combined and edited as

follows:

I. HEARING THE APPEAL WITHOUT HAVING JURISDICTION

II. REVERSING THE COMMISSION'S DECISION

III. FINDING THAT HORSESHOE'S INTERVENTION CURED PENNEBAKER'S

LACK OF STANDING

IV. FINDING VENUE WAS PROPER

V. RULING ON PENNEBAKER'S MOTION FOR CONTEMPT

VI. DENYING THE CASINOS' MOTION TO INTERVENE

¶2. Concluding that the circuit court erred in reversing the Commission's decision, we reverse the judgment

of the circuit court and reinstate the decision of the Commission. Because the resolution of Issue II is

dispositive of this appeal, we decline to address the remaining assignments of error.

FACTS

¶3. In November 1996, Horseshoe filed a state gaming license application for a specific site located in

eastern Warren County, near Hinds County and Interstate 20, on the Big Black River. After conducting a

public site assessment hearing, the Commission, by majority vote, found that the proposed site was not

suitable for gaming operations. In December 1996, Pennebaker filed a petition for judicial review of the

Commission's decision. The City and Horseshoe were later allowed to intervene. The City and the

Commission subsequently filed a motion to dismiss the appeal, which was denied.

¶4. The circuit court entered an order in December 1997, finding that the proposed site was in compliance

with all statutory requirements and was a legal site for the purpose of gaming, and entered its final judgment

in June 1998, reversing the Commission's decision. The circuit court found that the application should be

approved, and it remanded the matter back to the Commission, with instructions to proceed with

Horseshoe's application in accordance with its rules and regulations.

STANDARD OF REVIEW

¶5. The deferential standard of review the courts afford an administrative agency is even more deferential

for review of decisions and orders of the Mississippi Gaming Commission. Pursuant to the applicable

statute:
(3) The reviewing court may affirm the decision and order of the commission, or it may remand the

case for further proceedings or reverse the decision if the substantial rights(2) of the petitioner

have been prejudiced because the decision is:

(a) In violation of constitutional provisions;

(b) In excess of the statutory authority or jurisdiction of the commission;

(c) Made upon unlawful procedure;

(d) Unsupported by any evidence; or

(e) Arbitrary or capricious or otherwise not in accordance with law.

Miss. Code Ann. § 75-76-125(3) (2000) (emphasis added). See also Mississippi Gaming Comm'n v.

Bd. of Educ., 691 So.2d 452, 455 (Miss. 1997). Additionally, "a rebuttable presumption exists in favor of

the administrative agency, and the challenging party has the burden of proving otherwise." Clancy's Lawn

Care & Landscaping, Inc., v. Miss. State Bd. of Contractors, 707 So.2d 1080, 1082 (Miss. 1997).

DISCUSSION

ISSUE II. REVERSING THE COMMISSION'S DECISION.

¶6. The Commission argues that there is no reasoning or evidence to suggest that its decision was arbitrary

or capricious. It argues that the record clearly proves the opposite conclusion, because the record is replete

with substantial evidence of negative archeological, paleontological, historical, and economic consequences.

Horseshoe responds that the evidence submitted in opposition to the proposed site was flawed, unreliable,

and based upon incorrect assumptions. We agree with the Commission.

¶7. During the hearing, two of the Commissioners voiced their opinion that the proposed site was legal.

However, a vote was never taken as to the legality of the site, only the suitability of the site for gaming.

These opinions concerning legality of the site were not a part of the Commission's official minutes. The

Commission objected to the inclusion of these opinions as evidence before the circuit court, and it objects

to the inclusion of this evidence before this Court on appeal. The Commission argues that an agency can

only speak through its minutes, thus comments made by the members of the Commission are of no force.

The Commission is correct, and it was error for the circuit court to consider same. We have stated this

principle as follows:

A board of supervisors can act only as a body, and its act must be evidenced by an entry on its

minutes. The minutes of the board of supervisors are the sole and exclusive evidence of what the

board did. The individuals composing the board cannot act for the county, nor officially in reference to

the county's business, except as authorized by law, and the minutes of the board of supervisors must

be the repository and the evidence of their official acts.

Smith v. Bd. of Supervisors, 124 Miss. 36, 41, 86 So. 707, 709 (1920). See also Nichols v.

Patterson, 678 So.2d 673, 682 (Miss. 1996)(holding that "A Board of supervisors can act only as a body,

and its act must be evidenced by an entry on its minutes. The minutes of the board of supervisors are the

sole and exclusive evidence of what the board did."). The same principle applies to the individual members
of the Mississippi Gaming Commission. They can not speak for the Commission, and the Commission only

speaks through the official act of memorializing its minutes. Thus, it was error for the circuit court to

consider this evidence.

¶8. In reversing the decision of the Commission, the circuit court found it to be arbitrary and capricious.

There was no finding by the circuit court that the Commission violated the Constitution, exceeded its

statutory authority or jurisdiction, or performed an unlawful procedure. The statute clearly authorizes the

Commission to make certain decisions such as site suitability. Thus, in making such a determination, the

Commission does not exceed its statutory authority. See Miss. Code Ann. § 75-76-29(3) (2000); Casino

Magic Corp. v. Ladner, 666 So.2d 452, 459 (Miss. 1995). Further, as will be demonstrated, the

Commission's decision was supported by substantial evidence, even though "any" evidence would have

sufficed. Thus the decision was neither arbitrary nor capricious.(3)

A. Was the Commission's Decision Supported by Any Evidence?

¶9. In 1990, the Mississippi Legislature enacted the Mississippi Gaming Control Act, Miss. Code Ann. §§

75-76-1 to -313 (2000). In doing so, the Mississippi Gaming Commission was created in order to regulate

the gaming industry effectively. Id. § 75-76-7. Further, the Legislature declared the following:

Public confidence and trust can only be maintained by strict regulation of all persons, locations,

practices, associations and activities related to the operation of licensed gaming establishments and the

manufacture or distribution of gambling devices and equipment.

Id. § 75-76-3(b).

¶10. While administrative agency decisions are generally afforded great deference, that deference is

enhanced when that administrative agency is the Mississippi Gaming Commission. The Gaming

Commission's decision will not be disturbed if it is supported by "any" evidence. See Mississippi Gaming

Comm'n v. Bd. of Educ., 691 So.2d at 455; Casino Magic Corp. v. Ladner, 666 So.2d at 458. In the

case sub judice, besides the testimony of thirty-six different individuals, for and against the proposed site,

sixty documents and other types of evidence were submitted to the Commission for consideration. It is

undeniable that substantial evidence was introduced at the public hearing supporting the Commission's

decision that the Big Black River site was not suitable for gaming, including the following:

1. Allen Huffman, of the research firm Huffman & Rejeban, submitted a detailed analysis of the

adverse effect the project would have on the historical and archeological sites along the river.

2. David Dockery, Chief of Office of Geology for the State, presented evidence showing the negative

impact the project would have on the paleontological significance of the location.

3. Allen Rachels of the accounting firm of Crow, Chizek and Company, presented evidence of the

adverse economic impact of the project in a detailed study.

4. Further adverse economic impact studies were presented by the Vicksburg/Warren County

Economic Development Foundation, the Mayor of Vicksburg, and the City of Vicksburg.

5. The City of Vicksburg also presented evidence of the detrimental impact the project would have

on employment opportunities and tourism.
¶11. In sum, the above listed items satisfy the "any"evidence requirement, and the Commission's decision

was amply supported by the evidence presented.

B. Was the Commission's Decision Arbitrary or Capricious?

¶12. The circuit court reversed the Commission's decision because it was arbitrary and capricious.

However, it did so without enlightening us with its reason for this conclusion. This Court has defined the

term "arbitrary" as follows: "An administrative agency's decision is arbitrary when it is not done according to

reason and judgment, but depending on the will alone." Mississippi State Dep't of Health v. Natchez

Comty. Hosp., 743 So.2d 973, 977 (Miss. 1999). This Court has defined the term "capricious" as follows:

"An action is capricious if done without reason, in a whimsical manner, implying either a lack of

understanding of or disregard for the surrounding facts and settled controlling principles." Id. Further, in

City of Biloxi v. Hilbert, 597 So.2d 1276, 1280-81 (Miss. 1992), we said: "'Fairly debatable' is the

antithesis of arbitrary and capricious. If a decision is one which could be considered 'fairly debatable,' then it

could not be considered arbitrary or capricious ...."

¶13. After a thorough review of the record before us, we find that the Commission's decision was neither

arbitrary nor capricious. There is no indication in the record that the Commission's decision was not done

according to reason and judgment. There is no indication that the Commission's decision was done in a

whimsical manner. Even if we assume, without agreeing, that the Commission's decision was "fairly

debatable," it would necessarily mean that the decision was not arbitrary or capricious. The Commission

argues that it acted prudently, within its scope of authority, and upon evidence presented when it decided

that the proposed site on the Big Black River was not a suitable location for gaming. We agree.

¶14. As we have stated, "this Court ought and generally will affirm a trial court sitting without a jury on a

question of fact unless, based upon substantial evidence, the court must be manifestly wrong." Ezell v.

Williams, 724 So.2d 396, 397 (Miss. 1998). In the case sub judice, based upon the evidence before it,

the circuit court's decision was not based upon substantial evidence, and was thus, manifestly wrong. In

Mississippi Bd. of Pub. Accountancy v. Gray, 674 So.2d 1251, 1253 (Miss. 1996), we stated:

A reviewing court cannot substitute its judgment for that of the agency or reweigh the facts of the

case. Chancery and Circuit Courts are held to the same standard as this Court when reviewing

agency decisions. When we find the lower court has exceeded its authority in overturning an agency

decision we will reverse and reinstate the decision.

It was not the place of the circuit court to sit in the shoes of the Commission and decide whether or not the

proposed sit is suitable for gaming, nor is it our place. Pursuant to the standard of review, we can not, nor

need not make that determination. Because the circuit court exceeded its authority by substituting its

judgment for that of the Commission, we must reverse and reinstate the Commission's decision.

CONCLUSION

¶15. The Commission's decision was supported by ample evidence, and was not arbitrary or capricious.

Thus, the circuit court committed manifest error in reversing it. We therefore reverse the judgment of the

circuit court and reinstate the decision of the Commission.

¶16. REVERSED AND RENDERED.
PITTMAN, C.J., WALLER, EASLEY AND CARLSON, JJ., CONCUR. DIAZ, J.,

DISSENTS WITH SEPARATE WRITTEN OPINION JOINED BY McRAE AND SMITH,

P.JJ. GRAVES, J., NOT PARTICIPATING.

DIAZ, JUSTICE, DISSENTING:

¶17. I respectfully dissent to the majority's reversal of the circuit court and reinstatement of the Gaming

Commission's determination that the proposed site is unsuitable for gaming. The majority believes that the

decision could not have been arbitrary and capricious because it was supported by substantial evidence. As

demonstrated by the majority, a number of witnesses who were opposed to the new gaming site offered

opinion testimony as to their belief that the new gaming site would adversely affect historical, archeological,

paleontological, and economical aspects of the proposed gaming site and surrounding areas. The economic

impact study and other studies were submitted by the City of Vicksburg. In addition, witnesses testifying as

to the historical, archeological, and paleontological impact appeared on behalf of the City of Vicksburg, a

biased party that would obviously oppose any competition from casino's outside of Vicksburg. Horseshoe

Gaming sets forth several reasons why this evidence is flawed and unreliable. Whether this evidence is

flawed or not, a decision based on studies and testimony influenced by the wishes of the City of Vicksburg

and its existing casinos is in itself arbitrary and capricious. The decision of the Gaming Commission should

only turn on whether the proposed site was a legal and suitable site for gaming, not whether Vicksburg

faces a threat of competition. Choosing to rely upon anti-competitive studies and testimony submitted by

parties that are clearly biased and opposed to competition is clearly inappropriate. The majority concludes

that the evidence and testimony is substantial evidence. I disagree.

¶18. There was no evidence presented that would suggest that the proposed site was a poor choice for a

gaming site. On the contrary, all of the evidence presented suggests that the proposed site is an excellent

site to build a competitive gaming operation. Any evidence suggesting that Vicksburg might be damaged

from a casino outside of Vicksburg is only an indication that Vicksburg fears the competition this new casino

could bring. This type of evidence should not have been considered. Furthermore, as per Miss. Code Ann.

§ 97-33-1(b) and according to a majority of the Commission panel, the proposed site is a legal site for

gaming. The opposing evidence, listed by the majority, merely amounts to a politically influenced attempt to

keep an outside casino from competing with the Vicksburg casinos. In the Gaming Commission's order, the

finding was that gaming development at the proposed site would adversely affect the City of Vicksburg and

its existing casinos. Not only is this finding arbitrary and capricious, it also directly conflicts with Legislative

mandates.

¶19. The Mississippi Legislature requires the Mississippi Gaming Commission to regulate gaming so as to

promote competition. The statute provides:

(3) The Legislature hereby finds, and declares it to be the public policy of this State, that:

(a) regulation of licensed gaming is important in order that licensed gaming is conducted honestly and

competitively, that the rights of the creditors of licensees are protected and that gaming is free from

criminal or corruptive elements. (emphasis added).

Miss. Code Ann. § 75-76-3 (Rev. 2000). In addition, the Gaming Commission has stated, "[the

Commission] is not charged to protect existing licensees from additional competition, and we do not intend

to allow perpetuation of oligopoly through challenges to sites of competitors."
¶20. The Commission has turned its back on its own principles, allowing Vicksburg and Vicksburg casinos,

fueled by the potential threat of competition, to influence the Commission's decision in denying the gaming

site. The bulk of the presentation in opposition to the proposed gaming site consisted of testimony that a

casino on the Big Black River location would disrupt the gaming industry in Vicksburg. The decision should

not turn on whether Vicksburg approves of the gaming site. The decision, as per legislative mandate, should

be based solely on whether the site was a legal and suitable site for a casino. The proposed gaming site

would only foster healthy competition. For these reasons, I would affirm the decision of the circuit court and

its holding that the Commission's decision was arbitrary and capricious.

McRAE AND SMITH, P.JJ., JOIN THIS OPINION.

1. The Vicksburg Casinos were allowed to present oral arguments at the public hearing. The Casinos later

filed a motion to intervene in the appeal which the circuit court denied. The Casinos then appealed to this

Court, and we, by order dated December 8, 1998, consolidated the three different causes (two filed by the

Commission and the City and one filed by the Casinos) into the one appeal that is before us today.

2. Pursuant to Miss. Code Ann. § 75-76-3(5) (2000), a gaming license is a privilege, not a right.

3. Horseshoe argues that when the circuit court determined that the Commission's decision was arbitrary

and capricious, it was really saying that the Commission had exceeded its statutory authority. However,

because the circuit court held that the decision was arbitrary and capricious, we will address that

determination, notwithstanding Horseshoe's creative interpretation of what the circuit court really meant.