Case Name: LASSETER v. O'NEILL
Court: Supreme Court of Georgia
Jurisdiction: Georgia
Decision Date: 1926-09-28
Citations: 162 Ga. 826
Docket Number: No. 5157
Parties: LASSETER v. O’NEILL.
Judges: All the Justices concur, except
Reporter: Georgia Reports
Volume: 162
Pages: 826–839

Head Matter:
LASSETER v. O’NEILL.
No. 5157.
September 28, 1926.
James Maddox, for plaintiff. Denny & Wrighl, for defendant.

Opinion:
Beck, P. J.
The Civil Code (1910), § 4256 provides: "Gaming contracts are void, and all evidences of debt or incumbrances or liens on property, executed upon a gaming consideration, are void in the hands of any person. Money paid or property delivered up, upon such consideration, may be recovered back from the winner by the loser, if he shall sue for the same in six months after the loss, and after the expiration of that time it may be sued for by any person, at any time within four years, for the joint use of himself and the educational fund of the county." In § 4117 of the same code it is provided: "A bare contingency or possibility can not be the subject of sale, unless there exists a present right in the person selling, to a future benefit; so a contract" for the sale of goods to be delivered at a future day, where both parties are aware that the seller expects to purchase himself to fulfill his contract, and no skill and labor or expense enters into the consideration, but the samé is a pure speculation upon chances, is contrary to the policy of the law, and can be enforced by neither party." In §'4253 it is provided: "A contract which is against the policy of the law can not be enforced; such are contracts tending to corrupt legislation or the judiciary, contracts in general in restraint of trade, contracts to evade or oppose the revenue laws of another country, wagering contracts, contracts of maintenance or champerty." The above several sections of the Code of 1910, counted in the order above set out, appeared in identical language in the first Code (Code of 1861) as § 2717, 2594, and 2714. And they have been embodied in the several succeeding Codes. Each of them outlaws contracts of the character specified in each. Contracts that are illegal will not generally be enforced. The law will leave the parties where it finds them. In Ingram v. Mitchell, 30 Ga. 547 (5), applying this principle it was said: "When money is actually paid over upon an illegal contract, it is clear that it can not be recovered back, the contract being executed, and both parties being in pari delicto." See also Dorsett v. Garrard, 85 Ga. 734 (11 S. E. 768).
It would require a statute, in the circumstances mentioned in the foregoing excerpt, to authorize the person who had paid out the money to bring an action to recover it back. The above quoted § 4117 and 4253 of the Code of 1910, though having the effect of statutes, do not contain any provision authorizing a suit to recover money paid out on the contracts specified therein. Section 4256 alone contains such a provision. The first part of that section outlaws the contracts, while the latter part authorizes suit to recover back money paid out under the contract. In virtue of the adoption of the Code of 1910 by the legislature, that section has all the binding effect of a statute. A marginal note to that section cites the acts of 1764 and 1765 (Cobb, 725-727) as the source from which it was codified. That note is entitled to consideration as a part of the statutory law, as indicating the legislative intent in adopting that provision of law. The first section of the act of 1764 related entirely to lotteries and transactions in the nature of lotteries, and was intended to suppress them. The second section was for the purpose of suppressing other forms of gaming. Neither of them authorized the bringing of suits to recover money or property that had been paid out on account of losses incurred by practices condemned in the statute; but in the succeeding year the act of 1765 provided that persons who might lose money or goods by "playing" or "betting" at "any game whatever" might, after having "paid or delivered" the money or goods so lost, maintain a suit for its recovery against the "winner," if instituted within six months "next following;" and in case the loser failed to institute such suit within six months, any other person might bring the suit within four years, "one moiety of the money or effects" to be recovered to be for the use of the person suing for them, and "the other moiety" to be for "the use of the poor of the parish where the offense shall be committed." This act made special reference to the act of 1764, but did not authorize suits to recover money or property paid out on account of losses by lotteriés or transactions in the nature of lotteries. It only authorized suits for such recoveries for money paid out or property delivered on account of losses sustained by "playing" or "betting" "at any game whatever." So, in the adoption of section 4256, the word "gaming" was used in the sense of "playing" or "betting" at a game; and the provision thereof, "money paid or property delivered up, upon such consideration, may be recovered back from the winner by the loser [italics ours], if he shall sue for the same in six months after the loss, and after the expiration of that time it may be sued for by any person, at any time within four years, for the joint use of himself and the educational fund of the county," had reference to recovery of money or property paid or delivered up on account of losses by playing or betting at a game. All gaming and gaming or wagering contracts are denounced, but the foregoing is the only instance in which there is legislative enactment authorizing a loser to recover from the winner money or property after it has been paid by the loser to the winner.
The case of Alford v. Burke, 21 Ga. 46, was a suit against a stakeholder to recover money deposited by the plaintiff as a wager with another on a dog fight. The dog fight did not occur, and consequently there was no "winner," and the suit was not brought against the winner but against a stakeholder. It was held that the plaintiff could recover from the defendant stakeholder. This case was referred to in Dyer v. Benson, 69 Ga. 609, in which it was held: "Betting on a horse-race is gaming in- the sense of the Code; and since its adoption, one who has lost a horse by betting on such a race may recover it by suing therefor within six months." That case was decided after adoption of the first Code, and construed the provisions of the Code as now embodied in § 4256, supra. After referring to the decision of Alford v. Burke, 21 Ga. 46, it was said in the opinion: "That was a dog fight; this is a horse-race. If betting on one be gaming, betting on the other is also gaming. It is true that that was a suit against the stakeholder for the plaintiff's half of the bet on the dog fight deposited with him, and that makes a case between one of the parties to the bet and the stakeholder, and not between winner and loser. [Italics ours.] The court there does not decide that the winner should respond to the loser if the money had been delivered; but the entire reasoning goes to the point that the bet on the dog fight is illegal. The court say that 'the great rule of public policy established by our legislature is, that the winner shall not be protected in his unlawful gains, and that the loser, though party to an illegal wager, may sue and recover back the money.' It is true that the same opinion, in the next and concluding paragraph, referring to the remedies then given in Cobb's Digest, pp. 726, 727, contains the words, 'that those statutes give remedies only in the cases mentioned in them' but the Code now — section 2759 [4256 of the Code of 1910] — extends the remedy to all gaming. Is horse-racing and betting thereon gaming? A game is any sport; originally racing was one of the games of antiquity. Thence, from foot-racing came chariot-racing, horse-racing, etc., etc., which, all are sports or games for the diversion and amusement of spectators, and betting on any of these games becomes illegal, and gaming in the sense of the Code; and the loser of any money or other article lost on such bet may recover the article delivered, under the Code, from the winner of it. This must be the true sense of the section 2759 of the Code [4256], or it would have been limited, as the acts in Cobb's Digest, pp. 727, 728, were, to the games of cards, dice, etc., etc., therein enumerated. The codifiers wove into those old statutes the broader policy indicated by the opinion of Judge McDonald, in 21 Ga., p. 46, and the legislation adopting the Code made it lawful for the loser to recover, within six months from the loss of his goods, from the winner the goods so lost, not only in the games specified in Cobb's Digest, but in all cases of gaming."
From the foregoing excerpt it appears that the case was brought within the provisions of the Code section by reason of the fact that horse-racing and betting thereon was gaming within the definition given, which may be quoted again: "A game is any sport; originally racing was one of the games of antiquity. Thence, from foot-racing came chariot-racing, horse-racing, etc., etc., which all are sports or games for the diversion and amusement of spectators, and betting on any of these games becomes illegal, and gaming in the sense of the Code." See also Thrower v. State, 117 Ga. 753 (4), 756 (45 S. E. 126); Quillian v. Johnson, 122 Ga. 49 (6), 58 (49 S. E. 801). In the case of Thompson v. Cummings, 68 Ga. 124, the suit was on a draft for $364.95. The defendants pleaded that the draft was drawn to pay the losses upon the purchase of cotton "futures" from the plaintiffs, both parties knowing that there was no cotton held by either, and that the same was nothing but a mere speculation upon chances. The defendants further pleaded, by way of set-off, that the plaintiffs were indebted to the defendants in the sum of $478.76 which defendants had "put up as a margin in the hands of the plaintiffs to cover losses in the event of a decline in the price of cotton." It was held by this court: 1. "The sale of cotton to be delivered at a future daj1, where both parties are aware that the seller himself expects to purchase to fulfill his contract, and no skill and labor or expense enters into the consideration, but the same is a pure speculation upon chances, is contrary to the policy of the law, and can be enforced by neither party. But where such a contract is executed, an agent who may be employed by his principal to make the contract can recover from him any money advanced in the transaction by his authority. 2. No court will lend its aid to either party engaging in an illegal or immoral act. Therefore, he who deposits 'margins' in the purchase of cotton futures can not recover them by set-off or otherwise." This was a ruling, in a case involving cotton-future speculations, that a party to the transaction who was the loser of money thereby could not recover it back after it had been paid over, and it would make no difference that he was trying to recover it by a counterclaim by way of set-off in a suit instituted against him by the other party to the illegal transaction. This ruling would not have been made if the subject-matter of the set-off had consisted of money that had been won by "betting" at a "game," and the affirmative relief sought by the set-off had been pleaded by a "loser" against a "winner." The same may be said of the ruling in Lawton v. Blitch, 83 Ga. 663 (3), 665, where it was said: "Under our law, the Tosses sustained by the buying or selling of what is commonly called futures can not be recovered in a court of law."
After the statutes as embodied in the Civil Code (1910), § 4256, 4117, and 4253, had been established law for a long period of time, the legislature, on February 15, 1906, passed an act which is now embraced in the Civil Code (1910), § 4258, as follows: "Every contract or agreement, whether or not in writing, whereby any person or corporation shall agree to buy or sell and deliver, or sell with an agreement to deliver any wheat, cotton, corn, or other commodity, stock, bond, or other security, to any other person or corporation, when in fact it is not in good faith intended by the parties that an actual delivery of the articles or thing shall be made, is hereby declared to be unlawful, whether made or to be performed wholly within the State or partly within and partly -without this State; it being the intent of this section to prohibit any and all contracts or agreements for the purchase or sale and delivery of any commodity or other thing of value on margin, commonly called dealing in futures, when the intention or understanding of the parties is to receive or pay the difference between the agreed price and the market price at the time of settlement: Provided, that nothing herein contained shall be construed to apply to transactions by mail or wire between a person in this State and a person outside this State, where the person outside this State is not represented in this State by any. broker, agent, or attorney in said transaction." Section 4259 provides: "Every person who shall become a party to any such contract or agreement as is by the two preceding sections made unlawful, and every person who shall as agent, directly or indirectly, participate in making or furthering or effectuating the same, and every agent or officer of any corporation who shall in any way knowingly aid in making or furthering any such contract or agreement, shall be guilty of a misdemeanor." This law does not apply to gaming as referred to in the Civil Code (1910), § 4256, and as defined in Dyer v. Benson, 69 Ga. 609. Nor does this act of 1906 authorize suits to recover money or property after it has been paid over in transactions such as are described in the act. The act shows that the legislature contemplated a penalty to be imposed upon persons engaged in such prohibited enterprises or transactions, because it provided for prosecutions of persons who might violate the statute, and for punishment therefor as for a misdemeanor; but it did not provide that any person losing money in such transactions could bring a suit to recover it back after it had been paid out under the illegal transaction. In accordance with the general rule where persons are in pari delicto in the violation of a positive law, the statute contemplated leaving the parties where it found them. In this view the first question propounded by the Court of Appeals is answered in the negative.
Having returned an answer in the negative to the first question, it follows that the second question should be answered in the negative. No answer is required to the third question, as it appears from the question itself that an answer to it is desired only in the event the first two should be answered in the affirmative.
All the Justices concur, except