Case Name: Chevremont et al v. The People of Porto Rico
Court: Supreme Court of Puerto Rico
Jurisdiction: Puerto Rico
Decision Date: 1903-01-23
Citations: 3 P.R. 215
Docket Number: No. 1
Parties: Chevremont et al v. The People of Porto Rico.
Judges: Messrs. Chief Justice Quiñones and Associate Justices Fi-gueras and Sulzbacher, concurring.
Reporter: Puerto Rico Reports
Volume: 3
Pages: 215–261

Head Matter:
Chevremont et al v. The People of Porto Rico.
Appeal from the District Court of San Juan.
No. 1.
Decided January 23, 1903.
Provincial lottery — 'Tickets.—The tickets of the provincial lottery were government paper payable to hearer and the holders thereof must he reimbursed by the administration for a failure to carry out the drawings.
In. — An aleatory contract of chance not in violation of law, is a valid and enforceable contract.
Contracts. — The terms of a valid contract must govern without reference to extrinsic matters in absence of express provision for such reference.
Lotteries. — The forwarding of lottery tickets through the mails of the United States is prohibited by the postal laws, but lotteries are not-prohibited by the general laws of the United States.
Tickes of the provincial lottery. — The “Diputación Provincial” of Porto' Rico in issuing and selling lottery tickets, under the laws and regulations then in force, contracted an obligation to carry out the drawings thereof, and having failed to do so, the non-fulfillment of that obligation entitles the holders of such tickets to the reimbursement of the money paid by them, the Government of Porto Rico being bound to satisfy their claims.
Statement of the case.
This is an appeal taken by The People of Porto Rico in a “litigative-administrative” action instituted by Luis Che-vremont and others, against the Liquidating Commission of the late “Diputación Provincial”, for the recovery of the value of lottery tickets, the judgment appealed from being literally as follows: ' '
“In the City of San Juan, Porto Bico, this 4th, the day of October, 1901, in the matter of a litigative-administrative action instituted by Antonio Alvarez Nava, Esq., on behalf of Luis Chevremont, Adolfo Bobert, Andrés Cueto, Mullenhoff & Korber, Pedro Cardona, Bivera & Co., Cerecedo Hermanos & Co., Pedro Giusti and Anfiloquio Gándara, holders of lottery tickets, against the Liquidating Commission of the late “Diputación Provincial”, for reinbursement of the value of lottery tickets held by them, said Corporation being represented by the Attorney General.
I. — The Corporation known as the .“Diputación Provincial” of Porto Bico, having'been abolished by General Order No. 17, of November 20, 1898, of the Military Government of the Island, which held that it was unnecessary and incompatible with the Administration of public affairs, its various functions to be distributed among the Departments of “ Gobernación”, “Fomen- to ” and “Hacienda”, then existing, a Commission was created to ascertain the amount of its assets and liabilities and to distribute the same among the aforesaid Departments. A liquidator was appointed who presented a statement which prompted the promulgation of General Order No. 84, of April 18, 1900, providing “that all outstanding claims, against the abolished Corporation be presented and disposed of as speedily as possible, and the debts ■due the said body be collected”; and constituting “a new Commission to receive, hear and decide upon all claims against the said late “ Diputación Provincial”, or arising out of such contracts- with that body as may be presented within the period of six months from the date of said order ”, which among other provisions contains one to the effect that “in case any award of the Commission shall be disapproved by the Governor, or where the decision of the Commission is not unanimous, or where the claimant declines to accept the award of the Commission, the certificate of said award, together with the ■claim and the evidence in support thereof, shall be forwarded by the Governor to this Court, with such statement as the Governor shall desire to submit in the premises, and thereupon this Court shall proceed to consider and determine the claim under the proceedings known as “ Contencioso-Adminis-trativo ”.
II. — -Luis Chevremont, Adolfo Robert, Andrés Cueto, Mullenhoff and Korper, A. Rivera & Co., Cerecedo Hermanos & Co., Anfiloquio Gándara, Pedro Giusti and Pedro Cardona, filed with the Liquidating Commission their respective petitions setting forth that they held tickets pertaining to the two last drawings of the Provincial Lottery of Porto Rico; those of the first being one hundred and twenty-seven, which at the official rate of two forty-two and a half pesos, amounted to three hundred and seven pesos, and ninety-seven centavos, provincial money. In their petition they made oath that these tickets belonged to the two last drawings, and in the list it wras stated that sixty-three and nine-tenths tickets appertained to drawing No. 2 of April 5, 1898; those of the second petitioner consisted of .three thousand five hundred and nine tickets of the regular drawing No. 382 that should have been held on May 20, 1898, and nineteen and five-tenths of the extraordinary drawing of August 5th, same year, amounting to eight thousand five hundred and six pesos, sixty-one centavos, of the same money, at two forty-tw'o and a half pesos each; those of the third, one hundred and eighty-four tickets of drawing No. 382 of May 20th, amounting to four hundred and forty-six pesos, and twenty centavos, same -money; the fourth held two hundred and eighteen tickets, of drawing No. 382, amounting to five hundred and twenty-eight pesos, and sixty-five centavos, same money, at two forty-two and a half pesos; the fifth held fifty-twm and seven-tenths tickets of the extraordinary drawing of August 5th, which, with two acquittances, Nos. 11 and 40, for security on account of reserved tickets, aggregate one hundred and seventy-six pesos, and fifty-five centavos; the sixth held three hundred and ninety-nine and four-tenths tickets.of drawing No. 382, and one hundred and sixty-nine and two-tenths of extraordinary drawing No. 2, the whole amounting to oue thousand three hundred and seventy-eight pesos, and eighty-five centavos, provincial money; the seventh held three and eight-tenths tickets of extraordinary drawing No. 2, of August 5, 1898, amounting to nine pesos, and twenty centavos, same money; the eight held ninety-seven tickets and seven-tenths of extraordinary drawing No. 2, aforesaid, amounting to two hundred and thirty-six pesos, and ninety-two centavos, same money; and the ninth held one hundred and twenty-eight and nine-tenths tickets of No. 382 aforesaid, amounting to three hundred and twelve pesos, and fifty-eight centavos, same money. Each of the claimants presented a list showing the numbers of the tickets, and fractions of tickets, which they delivered in accordance with their respective petitions or invoices.
III. — For the purpose of deciding the aforesaid claims, there was attached thereto, and appears in the record, a copy of the Royal Order issued by the Minister of the Colonies, of the Spanish Cabinet on July 27, 1876, published in the Official Gazette of Porto Rico, August 17th, of the same year, authorizing the “Diputación Provincial” of this Island, to establish a Provincial lottery, pursuant to which order the proceeds of said lottery were included in the budget of 1877-78, the tickets. being sold at two forty-two and a half pesos each; regular drawing No. 382, and extraordinary drawing No. 2, of aforesaid lottery having been suspended. There also appears 'in the record opinions of two members of the Commission opposing the allowance of the claims on the ground that the lottery is an institution which tends to degrade and impoverish the community in which it flourishes; that from the affidavit of the claimants it was impossible to know whether the tickets had been obtained directly from the “Diputación”, or from authorized agents; and because the drawing of some of the tickets was to have taken place on May 20, 1898, and that of the others, those of No. 2, on April 5, 1898, which should agree with the memorandum, whereas from the declaration of Lar roca it appears that drawing No. 2, was to have been held on August 5, 1898; that the drawing of the lottery had to be suspended on account of the war, and could not take place afterwards by reason of the laws of the United States; that it is true that it was authorized by the Spanish Government, and its proceeds applied to the service and maintenance thereof; that there was no Royal Decree, Regulation or Statute authorizing any indemnification to purchasers in case the drawing should not take place, this being a risk taken by each purchaser; that only by equity and fairness could a purchaser of lottery tickets expect to have his money returned to him in such cases; that if the drawing had been held, only a limited number of prize-winners would have been benefited; that if there existed anything in the nature of a contract or right by reason of which equity and fairness would require the “Diputación” to reimburse the purchase-money, the war was sufficient cause to release it from such an obligation. The other member of the Commission favored the return of the money to the claimants, for the following reasons: That inasmuch as it was through the fault of the “Diputación” that the drawing did not take place, said Corporation had legally no right to appropriate the money for the purpose of meeting its own obligations; that the money collected from the public through the sale of tickets must be returned, because this matter should be decided in accordance with the Spanish law in force when the sale was made in conformity to the law, and it would be immoral for a public office to take money under false pretenses from the public, and then apply the same to the payment of public services; the state of war being no excuse, because as soon as said cause disappeared, the “Diputación” should-have either proceeded with the drawings or returned the money it had received from the sale of tickets belonging to the drawings that had not taken place.
IV. — Antonio Alvarez Nava, Esq., having entered an appearance on behalf of the nine claimants aforesaid fileddherewith the communications addressed to aforesaid petitioners, notifying them that their claims had been referred by the Governor to the District Court of San Juan, pursuant to paragraph 6, of General Orders No. 84, Series of 1900, and asked for the 'papers that had been forwarded by the Governor, in order to draw the complaint. This being granted, he set out in his complaint the foregoing-facts, stating further that the Liquidating Commission had dismissed the petitions of some of the claimants on the 8th, that of others on the 11th and those of the rest on the 15th of June; that inasmuch as the question at issue was one of a “litigative-administrative” character, the period within which an action could be brought was three months; that the parties concerned have capacity to sue;' citing articles 1 and 7 of the Law of Litigative-Administrative matters, paragraph 6, of aforesaid General Orders No. 84, and articles 1091 and 1124 of the Civil Code, he prayed that the question be finally decided by ordering that .claimants be paid the amount of the cost of their tickets with. interest at six per cent reckoned from the date when the drawings should have taken place to that of payment. This complaint, dated the 27th of June last, was admitted and notice thereof served upon the Office of the Attorney General.
V. — The representative of said Department, the Fiscal, asked that the complaint be dismissed on the ground that there is no obligation to pay the claimants any sum of money on account of tickets pertaining to lotteries the drawings of which had not taken place owing to force majeure, with costs against the plaintiffs, and alleged as facts: the authorization granted the “Diputación Provincial” by Royal Order, which took effect in 1877; that by reason of tlie war the sale of tickets was rendered difficult, and the drawings of July 15th, and August 5, 1898, could not be effected; that the“ Diputación” was abolished by General Order No. 17, of 1898, and the drawings could not be held as the game of lottery was held to be immoral by the new Government; that a liquidating commission was created to which were presented claims of ticket-holders, the decision of said commission being to the effect that these claims were not just and should not be paid; whereupon an appeal had been taken to the tribunal having cognizance of administrative cases, under the laws in force. And from a legal point of view he alleged that lottery was prohibited by existing laws as being immoral; that the purchaser of tickets is a gambler who risks his money on the hazards of fortune; that the laws do not provide what should be done in case the drawing of a lottery could not take place, after' selling tickets thereof; that the tickets were sold in the Island, and in foreign countries at a price higher than the official one paid by speculators, being treated as articles of commerce, and when they once left the hands of the “Diputación” the latter had nothing further to do with them; that a reimbursement had never been contemplated in the event of the failure of a drawing. to take place, purchasers of tickets accepting them without any express agreement upon this point, and that no responsibility attaches to the “Diputación” and the Treasury of Porto Rico, the ease being one of force majeure.
VI. — The complaint having been answered, and the parties agreeing as to the facts, there is no necessity for the taking of evidence. An abstract of the case was ordered to be made, and a day was set for the hearing, the parties being cited to appear, argued in support of their respective claims as set forth in the pleadings. All the rules of procedure have been observed in the hearing of this case. Associate Judge, Juan Morera Martinez, having prepared the following decision:
I. — Although it is true that the game of Lottery encourages a vice, which is fatal alike to the tranquility of families and the prosperity of the nation, because of its pernicious influence upon the customs of the people, wherefore to permit it is an economical, social and administrative error, it being for these reasons prohibited by the laws of the United States of North America, yet, it is no less true, that it was established here by the “Diputación Provincial” and has been in existence since 1877-78, with the consent of the Home Government; that it existed before the American occupation, having been created as an ordinary source of revenue and included in the budget of the “Diputación Provincial”, which retained twenty per cent of all the proceeds of each drawing toward meeting its expenditures, five per cent of said proceeds being turned over to and counted on by the State, and included in its budget, which facts exempt the Lottery from the characterization of an illicit game or one not legally permitted, although the characterization hereinbefore set forth and inherent thereto could not be eliminated or set-aside.
II. — Inasmuch as the administration and the Government have treated it as an income similar to other revenues, that is to say, a business operated by both for the porpose of obtaining sufficient revenues to cover their expenses,, it is not possible, so long as it was not prohibited by the Government, to ' apply to acts which took place prior to the' prohibition the reasonings upon which the prohibition is now based, not only because the law cannot have a retroactive effect, but also because no one can be. allowed to enrich himself to the prejudice of another person exercising a legitimate right under the protection of the law and the administration by virtue of which the tickets are delivered, their value received for the purpose of carrying out the drawings, and pay the prizes drawn, without which solemn obligation, the tickets would have been worthless, and sought by nobody.
III.' — -The tickets of the National Lottery were and are still considered in the Peninsula as Government paper payable to bearer; those who counterfeit, amend or alter them being amenable to the provisions of the Penal Code; and pursuant to said legal provision, the tickets of the Provincial Lottery were similarly considered and subject to the same penal prescriptions in aforesaid cases, all of which shows that, being of the same nature, their value should be reimbursed by the Administration, since the drawings to which they refer did not take place.
IV. — He who, availing himself of a contract, demands the delivery of the price, virtually recognizes the validity thereof; and as the aleatory contract of chance entered into was not in violation of the express provisions of any prohibitory law in force at the time, its validity cannot be questioned.
V. — Valid obligations efficaciously contracted have the force of law upon the contracting parties, and to decide any question that may arise as to the scope and limits thereof the clauses and conditions under which they were entered into must be abided by, and compliance with no others can be enforced except such as have been expressly stipulated, save such as naturally appertain to contracts, unless otherwise agreed, and this does not appear from the record to be the case nor from the rules, regulations and instructions governing the lottery, and the form of the tickets issued in conformity therewith.
VI.- — Ifj owing to force majeure, such as the state of war the Island was in,'or even after the termination of the war, the “Diputación” was unable to effect the drawings, it is neither just nor lawful that for this or any other-reason it should fail to return to purchasers of tickets, whereof the drawings did not take place, the money it had received from them and disposed of, because said force majeure, in the case at bar, only entitled it to an extension of time, either to reimburse said money or hold the drawings, which term of extension has more than expired. And as it is not a case of the loss of. property due, the legal provisions in regard to which are not applicable to the “Diputación Provincial”, a reimbursement must be made of the price of the tickets whose drawings were postponed and did not take place, inasmuch as the purchase of lottery tickets was legal at the time said purchase was made, because the sums received from the sale thereof were used to pay the expenses of the “Diputación”.
VII. — The aforesaid tickets being considered as government paper “payable to bearer”, no need was there to ascertain whether they had been obtained directly from the “Diputación” or from agents, the bearer being recognized as the sole owner thereof, without prejudice to third parties, which latter declaration was the province of the ordinary Courts; it being the duty of the Administration to make an official examination in cases of torn or damaged tickets, to ascertain whether or not the requirements and measures adopted to guard against conterfeit, had been complied with, and to pay the prizes within the term prescribed by the 1 ‘ Diputación ”; one of these measures being for the purpose of ensuring the sale of tickets, to dispose of a certain number by allotment to regular customers, who complied with the terms imposed by the Corporation, while the remaining tickets were left for sale to the public by the Director of Lotteries at his office, after the delivery of the reserved tickets had been made. The only one of the claimants who through error mentioned in the accompanying list April 5, 1898, as the date of drawing No. 2, vras Luis Chevremont, but in his sworn petition he stated that the tickets appertained to the two last drawings, and therefore the date could not be the one mentioned in the list, especially when the commissioners did not assert that the tickets belonged to a drawing to be held April 5th, which is not and could not be the case, because said drawings took place every twenty days, and No. 382 being fixed for May 20th, those for April had necessarily to be held on the 10th and 30th of said month, this being the resolution adopted for holding drawings; and because this was to be inferred from the notice published in the “Gazette” of this Island, under date of May 5th, announcing the suspension of drawing No. 382, and the notice which appeared in the Porto Eico “Gazette”, under the date of June 24th, and August 3th, stating that the extraordinary drawing to which the tickets of No. 2 referred, had to be held August 5th, the former having taken place on July 15th, as declared in said notice. The immaterial error appearing in the list of tickets presented by Chevremont should not be taken into account for the foregoing reasons, and because said error is made evident by the tickets themselves, upon which his claim is based, and as it has not been incurred by any of the other claimants, it would not be equitable, just nor legal to attach importance to such an immaterial error. In the notices published by the “Diputación Provincial” in the “Gazettes” of March 5th, and August 4, 1898, announcing the suspension of regular drawing No. 382 and extraordinary drawing No. 2, the tickets sold are declared valid for the postponed drawings which in due course would be announced and carried out. This implies the obligation to reimburse the value of said tickets or to pay the prizes in case the drawings took place, and therefore these tickets should be made good. As to the two receipts Nos. 11, and 40, presented by Rivera & Co. for sums deposited as security for two allotments of tickets, inasmuch as this question has not been decided by the Liquidating Office, said receipts having been separated on the 11th of last June, from the record, for the purpose of attaching them to the papers in the proceedings had in connection with the second part of Rivera & Co. ’s claim, as is shown by the communication addressed to him and filed with the complaint, wherein it is stated that the first part of claim No. 2, had been decided; and because no express claim having been made upon this point in the complaint, this Court can not consider the value of the aforesaid receipts. No temerity can be declared to have been evinced by the parties to this action. In view of the said announcements made in the “Gazette”; of'the Instructions and Rules and Regulations governing Lottery; articles 1 to 6, 16, 343, 345, 430, 433, 1088 to 1091, 1094, 1119, 1123, 1124, 1216, 1218, 1254 to 1258, 1790, 1798, of the Civil Code; General Orders No. 17, of November 29, 1898, and No. 84, of April 18, 1900, and particularly the doctrine of the Council of State, in deciding the appeals of administrative matters, of March 28, 1871, April 21, 1873, July 13, 1874, and January 19, 1889, we adjudge that we should and do sustain the action brought by the nine creditors or owners of tickets of the Provincial Lottery of this Island, mentioned at the commencement of this decision, the numeration whereof is set forth in the invoices or lists now in the possession of the Liquidating Commission of the “Diputación Provincial”, some of these tickets appertaining to regular drawing No. 382, which should have been held on May 20, 1898, and the others to extraordinary drawing No. 2 to have taken place on August 5th, same year, according to the notice published by the “Diputación Provincial” in the “Gazette” of Porto Rico, under date of June 24th, which drawings were postponed according to notices in said “Gazette” of May 5th and August 3rd and we adjudge the Administration to pay the value of said tickets, without special imposition of costs; and when this judgment becomes final an attested transcript thereof will be forwarded to the Auditor, through the Governor, as provided by paragraph 6, of General Order No. 84 herein before cited. Thus by this our judgment we pronounce, command and sign. Juan R. Ramos, Juan Morera Martinez, Jesús Romeu, Ramón Falcón.
Notice of the judgment haying been served upon Antonio Alvarez Nava, Esq., on the day after the same was rendered, namely, October 5, 1901, and upon The Honorable, The Attorney General, on December 3rd, of the same year, the Fiscal took an appeal therefrom which was allowed both for the purposes of review and for stay of proceedings, the parties being cited to appear on the 13th and 17th of December aforesaid. The record having been received in the Supreme Court, the Hon. Attorney General and Antonio Alvarez Nava, Esq., by an order entered January 24th, of the following year, were held to have entered an appearance, they having appeared respectively on January 15, 1902, and December 18, 1901. And it should be noted that in the document entering an appearance Antonio Alvarez Nava, Esq., stated that he wished to prosecute the appeal, but failed to do so in his brief.
Mr. Harlan, Attorney General, for appellant.
Mr. Alvarez- Nava, for respondents.

Opinion:
Mr. Associate Justice Hernández,
after making the above statement of facts, delivered the following opinion oí the Court:
The facts and the legal propositions set forth in the foregoing judgment are accepted, save the first of the latter, in so far as it seems to affirm that the game of Lottery is prohibited by the laws of the Congress of the United States, although the postal laws of the United States'do prohibit and punish the forwarding of lottery tickets through the mail. The "Diputación Provincial" of Porto Rico, in selling the lottery tickets which have given rise to this suit, contracted the obligation imposed by the regulation governing the matter of carrying out the drawings thereof, and having failed to do so, the non-fulfilment of that obligation entitles the holders of tickets to the reimbursement of the money paid by them, both because of the highly moral and juridical principle that no one should enrich himself to the prejudice of another, applicable not only to persons, hut to every legal entity, and because it is so provided by article 1124 of the Civil Code which declares that the right to rescind the obligation is considered as implied where the same is mutua], in case one of the obligated persons does not comply with what is incumbent upon him. The "Diputación Provincial", having been abolished by General Order No. 17, Series of 1898, in which it was ordered that the Secretary of the Treasury should take charge of the assets and liabilities and collect all the credits and liquidate all the debts thereof, and a Liquidating Commission having been created by General Order No. 84, Series of 1900, to receive, hear and decide upon all claims against the said late "Diputación Provincial", in order that such debts as were duly acknowledged might be paid as speedily as possible, it is evident that it devolves upon the Government of Porto Rico, through its Treasurer, to pay by way of reimbursement, the sums claimed by plaintiffs as holders of tickets of the Provincial Lottery the drawings of which did not take place in due time. The decision adjudging the Administration to pay the value of the tickets specified in the complaint, without special imposition of costs and taking no account of the interest, cannot be amended for the benefit of respondents as requested by them at the hearing, because for this purpose they should have signified their desire to continue the prosecution of the appeal when the papers were submitted to them; nor can the fact of their having' prematurely done so on entering an appearance in the Supreme Court, be of any benefit to them, inasmuch as this cannot be done either before or after the aforesaid step in the proceedings as is expressly provided in Article 467 of the Regulation for the execution of the Law of Litigative-Administrative matters. We adjudge that-we should affirm and do affirm the judgment rendered by the District Court of San Juan, on October 4, 1901.
Messrs. Chief Justice Quiñones and Associate Justices Fi-gueras and Sulzbacher, concurring.
Mr. Associate Justice MacLeary, dissenting.