Court Opinion

ID: 3547751
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:00:16.945042+00
Date Added: 2024-06-11T13:56:11.389882
License: Public Domain

This case in mandamus brings under review the proceedings and resolutions of the board of commissioners *Page 379 
of the city of Las Vegas respecting the issuance and refusal to issue gambling licenses following the enactment by our last legislature of the so-called "Open Gambling Law" providing for the operation of slot machines, gambling games, and gambling devices enumerated therein under license; providing for certain license fees and the use of the moneys obtained therefrom. Stats. 1931, p. 165. The act became effective from the date of its approval on March 19, 1931, and repeals all acts and parts of acts in conflict with it. Section 13b of the act provides that nothing contained therein shall affect the powers conferred by the provisions of the charter of any incorporated city to fix, impose, and collect a license tax.
Prior to the enactment of the open gambling law it was made a felony to conduct or operate in this state the gambling games and gambling devices involved in this proceeding for profit.
The admitted facts of the case are substantially as follows:
Upon the adoption and approval of the so-called open gambling law, the city of Las Vegas at the same session of the legislature on, to wit, March 27, 1931, procured an amendment to certain sections of its articles of incorporation. Section 31, subsec. 10, was amended so as to give the board of commissioners the power to "license and regulate gambling as allowed by law, and to prohibit gambling in all of its various forms." Stats. 1931, p. 374.
Pursuant to the state law and said amendment, the board of commissioners on, to wit, March 30, 1931, proposed an ordinance entitled "An Ordinance to Prohibit Gaming and the Operation of Slot Machines in the City of Las Vegas, without first obtaining a license therefor, regulating the same, fixing the amount of such licenses, providing penalties therefor, and repealing Ordinances Nos. 77, 82, 88, 103, and 115, and all Ordinances and parts of Ordinances in conflict therewith." Section 7 of the ordinance is as quoted in the opinion of Justice DUCKER. It appears, in fact it is conceded, that the *Page 380 
ordinance did not and could not, under the city charter, become effective until on May 5, 1931. In the meantime a number of persons and association of persons, on and prior to April 7, 1931, filed with the clerk of the board of commissioners applications for licenses to conduct and operate the gambling games and gambling devices allowed by law. On said date there were on file the applications of petitioners and applications of the Boulder Club, the Las Vegas Club, the Exchange Club, and the Northern Club. Upon consideration of these applications it was moved, seconded, and carried that the applications of said clubs be approved and allowed. Upon this approval a discussion arose as to granting other licenses. This discussion was participated in by a number of citizens of Las Vegas who were present, and upon discussion the following resolution was adopted: "Resolved: That this Board of City Commissioners of the City of Las Vegas not grant any gambling licenses except to those places of business that held gambling licenses in the previous quarter, and that new licenses not be considered until a zone is established for the operation of gambling houses, and a policy is adopted by the Board governing the issuance of new licenses."
On April 9, 1931, at a recessed regular meeting of the board, a number of citizens being present, the board again entered upon the discussion of granting of gambling licenses and placing of a zone. On motion it was resolved as follows: "Resolved: That until the further order of this Board it be and is hereby established as the policy of this Board that no further gambling licenses be granted except those already granted for this quarter, and to those who held gambling licenses for the immediately preceding quarter; provided that this resolution shall not be construed to prevent the consideration of an application for and the granting of a license to a person of the Ethiopian Race for the conduct of a game or games in a place catering exclusively to persons of the same race only." *Page 381 
On April 17, 1931, the minutes of a recessed regular meeting of the board show that upon motion gambling licenses were granted Leo Kind and Thomas Rowan and the Big Four Club. At this meeting on motion duly made and carried a blanket resolution was adopted, the preamble of which reads as follows: "Whereas six gaming licenses under Ordinance No. 165 of this City (exclusive of licenses solely for slot machines) have already been issued in the City of Las Vegas, or a provision for about one licensed gaming house (exclusive of places where slot machines only are operated) to every one thousand five hundred (1500) of our population."
At this meeting the following resolution was adopted: "Resolved: That the application of Roy Grimes, D.J. McCauley and R.H. Davenport for gaming licenses to be operated under at Lorenzi Resort, in the City of Las Vegas, County of Clark, State of Nevada, be and the same is hereby denied for the reason that under Ordinance No. 165 of said City six gaming licenses (exclusive of licenses issued solely for the operation of slot machines) have already been issued in this City, and upon careful consideration of the question we believe that public interest requires that no additional licenses (other than licenses solely for the operation of slot machines, and for additional games, at the location for which license is already granted, under the provisions of Section 9, of said Ordinance No. 165, `Any licensee holding a valid existing license from the City of Las Vegas, and from the County of Clark, State of Nevada, for a current quarter may, during such current quarter, secure a license for additional slot machines, games or devices, as the case may be, over and above the particular number of slot machines, games or devices for which he, they or it holds a license, for the remainder of the quarter by paying to the City Clerk the license fee above provided, for the additional particular slot machine, game or device, as the case may be, and for which the City Clerk shall issue an additional license for the remainder of such quarter, and the additional *Page 382 
license shall be upon the same terms and conditions as though issued under the provisions of Section 8 of this Ordinance,' be granted in this city in excess of the number already granted, until the further order of this Board and until further or other gaming licenses (other than licenses solely for the operation of slot machines) are reasonably necessary for the accommodation of the public and the granting of such further or other licenses will not contravene public interest and will not require an excessive amount of police protection for a city the size of Las Vegas, Nevada, having in mind the funds provided for police protection under the City's 1931 and 1932 Budgets heretofore adopted and the state of the City funds applicable to police protection."
At this meeting a number of applications for licenses were for the same reason rejected by resolution.
I am of opinion that the resolution rejecting the application of petitioners is invalid and illegal in this:
First, the resolution purports to be based upon the authority of ordinance No. 165, which admittedly was not in effect at the time the resolution was adopted. Consequently the disallowance of the petitioners' application was upon the authority of a resolution, and not ordinance No. 165. A resolution is not the equivalent of an ordinance, but rather an act of a temporary character, not prescribing a permanent rule of government, but is merely declaratory of the will of a corporation in a given matter, and in the nature of a ministerial act. 43 C.J. 519.
Second, the resolution was invalid and illegal in that it purports to grant licenses only to those who held gambling licenses for the immediately preceding quarter. It is inferable from this that the board had, prior to the enactment of the open gambling law, issued gambling licenses to the Boulder Club, Las Vegas Club, Exchange Club, and the Northern Club without authority of law, as under the law existing at the time no such license could legally have been granted. *Page 383 
Third, the resolution was invalid and illegal in that it gives a monopoly of the gambling concessions in the city of Las Vegas to the Boulder Club, Las Vegas Club, Exchange Club, Northern Club, and the Big Four Club, by providing that the licenses granted are to continue until in the opinion of the board it is reasonably necessary for the accommodation of the public that further or other licenses be granted. In that event the holders of the licenses granted are privileged to increase the number of gambling games as public necessity in the opinion of the board may require.
Fourth, the resolution was not adopted in the exercise of the police power, but for revenue purposes.
It is a fundamental principle of our system of government that the rights of men are to be determined by the law itself, and not by the let or leave of officers or boards acting in an administrative capacity. This principle cannot be surrendered or in effect nullified for the sake of expediency. Thompson v. Smith (Va.), 154 S.E. 579, 71 A.L.R. 604.
I quite agree with my associates that a state or a city has the power to prohibit the doing of an act altogether. It has the power to permit the doing of an act upon any condition, or subject to any regulation, however arbitrary or capricious it may be. Thompson v. Smith, supra, and cases cited.
Before the passage by Congress of the Volstead act this doctrine was pronounced more often in cases involving the granting, refusing, and revoking of licenses to sell intoxicating liquors or do things, which, because of their character, are, or tend to be, injurious, as, for instance, keeping a gambling house or a bawdy house, or operating a junk or pawnshop.
In Nevada, however, a gambling house is a privileged institution operated under the sanction of the law. The city of Las Vegas, although it had under its charter the power to prohibit gambling and gaming in all of its forms as allowed by law, did not choose to do so. On the contrary, its board of commissioners, not in the *Page 384 
exercise of its police power, undertook by resolution to arbitrarily grant licenses for revenue purposes to some and refuse to grant licenses to others of like character, under like conditions and circumstances.
I concede that the city of Las Vegas has by legislative enactment under its police, power to grant, refuse, and revoke under rules of general application gambling licenses, but may not by an arbitrary resolution of its board of commissioners arbitrarily refuse or revoke or grant a license to one and refuse a license to others of like qualifications, under like circumstances and conditions. Thompson v. Smith, supra. In other words, its board under the guise of police powers cannot say that a gambling license shall be granted to A and the same right denied to B.
The opinion of Justice DUCKER concludes with this language: "The same reason was given by the board in the case before us. It is evidence showing that the board did not act arbitrarily in granting six licenses in the city and denying petitioners' application. This, together with the presumption that officers who are acting under the sanction of an oath will act lawfully, is sufficient in the absence of any evidence to the contrary to rebut the claim of unlawful discrimination."
Here the contrary is shown by the board's own resolutions to the end that one person is granted a license and another of like qualifications, under like circumstances and conditions is denied a license. Where an ordinance or resolution is enacted in pursuance of legitimate exercise of police power and it is manifest therefrom that there is an unjust discrimination, courts interfere. The policy of the board of commissioners in the instant case as declared by its resolution in refusing a license to petitioners is that public morals, the public welfare, and police protection will best be served by conferring all of the gambling privileges in the city of Las Vegas on those who held licenses prior to the enactment of the open gambling law.
The argument that the resolution in question as a police regulation was a legitimate limitation upon an *Page 385 
occupation inherently injurious to public morals and public welfare is without force. The resolution upon its face shows that it was not motivated by any such high ideals. Upon the contrary, it is made to appear therefrom that, so long as the "fortunate" six are able to cope with the public demand for gambling, there will be no necessity for granting other licenses or creating a zone for gambling houses. In this respect the legal effect of the resolution is to limit the number of gambling houses but not the number of gambling games, thus giving the proprietors of six gambling houses the exclusive right and privilege of carrying on and conducting all gambling games as public interest in the judgment of the board of commissioners shall require. Some better or stronger reason than that shown in the resolution must appear to support the contention that the board had the authority or right to grant six licenses and reject the seventh application to conduct one more game allowed by law at a place not shown to be objectionable.
The argument that the resolution limiting the number of gambling houses and not the number of gambling games is in the interests of economy in the matter of the cost of police protection is also without force. The tax imposed under the proposed ordinance is essentially a license tax for revenue purposes and not for police regulation. It is a matter of common knowledge that legalized gambling in this state is supposed to result in a continuous source of increased revenue by day and by night for the benefit of the state, the counties, municipalities, and quasi municipalities within the state, for their general purposes.
It is fair to assume that the city of Las Vegas will share in the benefits in proportion to the number of licenses issued the several persons or associations of persons, as the case may be, as in the opinion of the board of commissioners of the city public necessity may require. Thus the veil of good morals and public welfare is torn from the face of the resolution, and its real policy, purpose, and effect is laid bare. *Page 386 
Under the admitted facts I am compelled to conclude that no valid or legal reason is assigned for the refusal of the board of commissioners to allow petitioners' application for a license to conduct one more gambling game in the city of Las Vegas as allowed by law, and that the action of the board in denying the application was arbitrary and discriminative; that the denial of the application was an abuse of power and not the exercise of a reasonable discretion in a lawful manner. I think the wrong done should be remedied by mandamus.