Court Opinion

ID: 5744141
Source: CourtListenerOpinion
Date Created: 2022-01-12 16:46:34.495841+00
Date Added: 2024-06-11T08:41:07.361775
License: Public Domain

Stevens, J. (dissenting).
Plaintiff sued here for the recovery of the total sum of $12,000. The first cause of action to recover the sum of $3,000 was based upon a check made and delivered by defendant in Puerto Rico to the plaintiff. The other causes of action were to recover the total sum of $9,000 which defendant had lost at gaming in the plaintiff’s establishment in Puerto Rico. Defendant had established a credit before the losses, which he asserted was limited to $7,000. The money was given directly to defendant as he requested it while gambling. It is not disputed that the $12,000 represented a loss at gaming, and that gaming is legal in Puerto Rico. Thus the consideration for the contract was good according to lex loci.
On this appeal by defendant from a judgment for plaintiff, defendant-appellant asserts gambling is a heinous offense, repulsive to New York’s concept of morality, contrary to its public policy and is unenforcible here.
The single question is whether the general principle that a contract will be upheld whenever possible (sometimes referred to as the Rule of Validation) applies here, or whether enforcement must be denied for some or all of the reasons advanced by appellant. Should New York, as a matter of comity, recognize the obligation?
*51No question of the individual view as to the morality or rightness of gambling is involved. The bases of rejection must be broader. "To render foreign law unenforceable as contrary to public policy, it must violate some fundamental principle of justice, some prevalent conception of good morals, or some deep-rooted tradition of the common weal.” (8 N. Y. Jur., Conflict of Laws, § 4; Loucks v. Standard Oil Co., 224 N. Y. 99, 111.) The mere fact that a contract sought to be enforced would be illegal if such contract had been made in New York, is not alone sufficient grounds to deny recovery (Thatcher v. Morris, 11 N. Y. 437 [1854]). In the Thatcher case, plaintiff sought to recover the amount of prizes drawn by tickets in a Maryland lottery. At that time lotteries were illegal in New York. The court denied recovery because the plaintiff failed to plead and prove the legality and validity of the contract where made and that it was to be performed without the State. If such had been shown, the contract would have been upheld though illegal in New York, the court saying in such instance: “ [i]t is as if an exception had been engrafted upon the statute * * * excluding from its operation all contracts made without the state ” (ibid, p. 439). In the case on appeal, the pleading and proof met the test enunciated in Thatcher v. Morris (supra). (Cf. Russell v. Societe Anonyme des Etablissements Aeroxon, 268 N. Y. 173 [1935], which involved Statute of Frauds, but, also, cited Thatcher v. Morris [p. 182]; Harris v. White, 81 N. Y. 532; Ormes v. Dauchy, 82 N. Y. 443, which held an agreement for publication of lottery advertisements outside New York State is enforcible in the courts of New York.)
‘ ‘ At common law gambling was neither illegal nor considered immoral. This may account for the fact that prohibiting legislation has usually been held not sufficiently expressive of forum policy to invalidate gambling agreements entered into outside the forum. In England, and in the majority of American jurisdictions, the Rule of Validation has prevailed.” (Ehrenzweig, Conflict of Laws, p. 482.) ‘ ‘ Cases in which a strong forum policy is given effect to invalidate a contract valid under a pertinent foreign law, are becoming increasingly rare and may be virtually limited to contracts concluded outside the forum for the very purpose of evading the forum’s law.” (Ehrenzweig, Conflict of Laws, p. 474.) No contention is advanced here that the contract was entered in order to evade the laws of New York.
It can hardly be argued with any degree of validity that enforcement of the contract here involved would tend to disturb the peace, require the production of indecent evidence to support it, be in sharp and substantial conflict with the morals of the age *52or be inconsistent with the established interests of society in general. Certainly it does not affect the pecuniary or the legal interests of the community. A common-sense appraisal of the requirements of justice, the contract having been fully and validly entered, would support its enforcement.
The doctrine of Nielson v. Donnelly (110 Misc. 266 [1920]) upon which appellant places great stress, is of doubtful validity in the present state of our law. (See Thuna v. Wolf, 132 Misc. 56 [1928], where the Appellate Term, in reversing Thuna v. Wolf, 130 Misc. 306, in which recovery had been allowed upon a check given in Florida in payment of a gambling debt, said the check was an executory contract and governed by the laws of New York.) The court referred to the fact that it was not a family or friendly game, and a contention had been advanced that there was cheating. Since it was given for an illegal consideration it would not be enforced. The court said: “ [h]ad plaintiff sued on the contract rather than on the check, it might perhaps have been presumed that such a gambling debt is valid in Florida and an argument might be made that it could be enforced in the courts of this State. (* * * Thatcher v. Morris, 11 N. Y. 437 ”) (p. 57); see, also, Tropicales, 8. A. v. Drinhhouse, 15 Mise 2d 425 (1959), recovery allowed upon a check given for a gambling debt; cf. Tropicales, S. A. v. Milora, 7 Misc 2d 281.
As to judgments of a sister State, the general view is that such judgment is entitled to full faith and credit even ‘ ‘ though the cause of action upon which the judgment was based is against the law and public policy of the state or territory in which enforcement is sought” (Goodrich, Conflict of Laws [3d ed.], pp. 620-621; Fauntleroy v. Lum, 210 U. S. 230). “ The result ”, says Goodrich, “ while not comforting to local prejudices, seems an extremely desirable one from the broader point of view” (p. 621).
It is recognized, in the instant case, the claim was not reduced to judgment when plaintiff sought to utilize our judicial facilities. But if the general principle is applicable, redress should not be denied. “Indeed, in these days [one] cannot afford to be too pious about this matter of gambling [and] to be shocked or to prate of public morals or public policy when confronted with an application for relief upon a contract lawful at the place of its performance ” (Ehrenzweig, Conflict of Laws, § 181, p. 482, citing Nevcal Enterprises v. Cal-Neva Lodge, 194 Cal. App. 2d 177). The observation quoted is of especial pertinency when the forum, as here, recognizes gambling in divers forms, though not cards or dice, as is here involved. Whether the reason assigned for the *53deviation be ‘ ‘ improvement of the breed ” or revenue (horse racing), or the fostering and aiding of charity or religious causes (bingo), the stark fact is that gambling is permitted. Thus, gambling per se is not so contrary to public policy or so offensive to public morals as to demand complete prohibition. Nor should judicial process be denied when one seeks to enforce an obligation of this nature, valid at the place of creation. The identity of the beneficiary and the avowed purpose, rather than the nature of the activity, governs the attitude of New York toward gambling.
The constitutional prohibition, and permissive exceptions (N. Y. Const., art. I, § 9) are guidelines of conduct for, and limitations on, activity of the citizenry of New York within the territorial borders of the State. Such prohibition and exceptions do not, and were never intended to, proscribe the citizens’ activity without the confines of this State. New York does not hold, as an absolute, that gambling is injurious to the interests of the State, or contrary to the public good, for the revenue derived from pari-mutuel betting is to be used for the support of government. To condemn by implication, or nonrecognition of the validity of the contract, the laws of another State which has merely gone a step further in its permitted exceptions, is to erect a standard of dubious value.
The judgment appealed from should be affirmed, though there may be some doubt as to the $3,000 represented by the check which is an executory contract.
Rabin and Noonan, JJ., concur with Valente, J.; Stevens, J., dissents in opinion in which Beeitel, J. P., concurs.
Judgment reversed, on the law, and the complaint dismissed, with costs to appellant.