Opinion ID: 852327
Heading Depth: 2
Heading Rank: 1

Heading: Duration of the Agreement

Text: The City argues the trial court erred by holding that the contract represented by the letter agreements reflected an implied durational term lasting as long as the river boat license. (City's Br. at 10-11, quoting App. at 58.) Even if that is true, says the City, the original license began in 1997 and expired after five years. (City's Br. at 10.) Second Century, by contrast, submits that the trial court correctly concluded that the economic development agreement reflects an implied term that is coterminous with the duration of the existence of a license to operate a boat at East Chicago and is therefore not terminable at will. (Second Century's Br. at 10.) It is ordinary law that a contract containing no specific termination date is terminable at will and that where the parties fix no time for the performance or discharge of obligations created by the contract they are assumed to have had in mind a reasonable time. House of Crane Inc. v. H. Fendrich, Inc., 146 Ind.App. 478, 256 N.E.2d 578 (1970). The original license was issued to Showboat effective April 15, 1997. The initial term of the license thus would have expired on April 15, 2002. See Ind.Code § 4-33-6-10(d) (2008) (five-year term for riverboat licenses). Before that date arrived, Showboat desired to transfer the license to Harrah's, and the City and various other parties entered into a series of subsequent agreements in 1998 and 1999, which effectively allowed the City to reaffirm the original agreements. (App. at 340-41.) The Commission approved the transfer to Harrah's on February 26, 1999. (App. at 341.) In the course of the 2004-05 transactions, transferring the license from Harrah's to Resorts, the parties plainly intended to honor the same commitments contained in the letter agreements. (App. at 342.) After a hearing on April 21, 2005 (a few months after Mayor Pabey took office), the Gaming Commission unanimously approved the transfer. (App. at 343.) The Commission's role in these events is a central one. Indiana's Riverboat Gambling Act provides: A license to operate an excursion gaming boat: (1) is a revocable privilege granted by the state; and (2) is not a property right. Ind.Code § 4-33-6-17 (2008). The Commission may renew an existing license. Ind.Code § 4-33-4-1(a)(14) (2008). The Code also provides that any sale or transfer of a license is subject to the approval by the Gaming Commission, requires that a proposed acquirer must meet the same criteria applicable to any initial applicant, and directs the Commission to adopt rules reflecting the standards applicable to transfers. Ind. Code § 4-33-6.5-12 (2008). Moreover, the Commission has the authority to revoke or cancel the licenses and their attendant conditions. See Ind.Code § 4-33-4-1(a)(11) (2008). We agree with Second Century that even if the City could terminate the agreements at will, the City alone could not redirect gaming revenue presently flowing to the private entities by means of the ordinance it adopted in 2005, or by other means, for that matter. ( See Second Century's Br. at 11.) The City does not have the authority unilaterally to terminate or alter the terms and conditions of a license issued by the Gaming Commission. Such alterations lie within the duties and powers that the Riverboat Gambling Act confers upon the Gaming Commission, which has historically acted by taking into serious account the views and arrangements of the cities in which gaming operations are conducted. While the Foundations and Second Century are correct that the agreements imbedded in the license do not appear terminable at will, the City is correct that they are subject to periodic alteration (through the administrative processes of the Gaming Commission). As the City's motion for summary judgment sought a court order to turn over to the City all funds that Second Century and the Foundations had received and would receive from the riverboat operations, the trial court was warranted in denying the motion.