La Mesa Racetrack & Casino v. State Gaming Control Board , 2 N.M. 241 ( 2012 )

I attest to the accuracy and
integrity of this document
New Mexico Compilation
Commission, Santa Fe, NM
'00'04- 15:45:48 2012.08.08
IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO
Opinion Number: 2012-NMCA-076Filing Date: June 12, 2012
Docket Nos. 31,156 & 30,862 (consolidated)
LA MESA RACETRACK & CASINO,
RACETRACK GAMING OPERATOR’S
LICENSE NO. R-009,
Petitioner-Appellant,
v.
STATE OF NEW MEXICO
GAMING CONTROL BOARD,
Respondent-Appellee.
APPEAL FROM THE NEW MEXICO GAMING CONTROL BOARD
M. David Chacon, Hearing Officer
Bregman & Loman, P.C.
Sam Bregman
Eric Loman
Albuquerque, NM
for Appellant
Gary K. King, Attorney General
Santa Fe, NM
Frank A. Baca, Special Assistant Attorney General
Peggy A. Hardwick, Special Assistant Attorney General
Albuquerque, NM
for Appellee
OPINION
VIGIL, Judge.
1
{1} The New Mexico Gaming Control Board (Board) ruled that a gaming license it
issued to La Mesa Racetrack and Casino, L.P. (La Mesa) was rendered void by statute when
La Mesa failed to conduct any live horse races during the 2010 meet pursuant to a license
issued by the New Mexico Racing Commission (Racing Commission) to conduct such races.
La Mesa appeals the Board’s ruling in two separate appeals, which we have consolidated.
For the reasons stated herein, we affirm.
I. BACKGROUND
{2} La Mesa appeals from two final orders issued by the Board pursuant to NMSA 1978,
Section 60-2E-60(A) (2002) (providing that any person adversely affected by an action taken
by the Board after its review pursuant to NMSA 1978, Section 60-2E-59(A) (2002) may
appeal to the court of appeals).
{3} On January 22, 2009, the Racing Commission granted La Mesa a license (racing
license) to conduct live horse races in Raton, New Mexico for the 2010 meet. The racing
license required La Mesa to conduct sixty days of live horse racing from May 28, 2010, to
September 6, 2010.
{4} As a racetrack licensed by the Racing Commission, La Mesa was entitled to apply
to the Board for a gaming operator’s license (gaming license) to operate gaming machines
on its premises where the live racing is conducted. NMSA 1978, § 60-2E-27(A) (2005)
(amended 2009) (“A racetrack licensed by the state racing commission pursuant to the Horse
Racing Act . . . to conduct live horse races or simulcast races may be issued a gaming
operator’s license to operate gaming machines on its premises where live racing is
conducted.”). La Mesa applied for a gaming license, and on June 11, 2009, the Board
granted La Mesa a conditional gaming license, subject to La Mesa satisfying seven
conditions. Conditions Nos. 2 and 3 were that:
2. [La Mesa] shall submit an unconditional letter of commitment for
funding sufficient to complete the construction of the racetrack
facilities necessary to conduct live racing, as outlined in phase 2 in
[La Mesa’s] license application, and do so on or before December 31,
2009.
3. [La Mesa] shall submit a plan to be approved by the Board,detailing
its legal and financial [divestiture] from LLMN Investments, LLC,
within 30 days of the issuance of this Decision and Order, which
should include the proposed restructuring of Horse Racing at Raton,
L.P. and Horse Racing at Raton Management, LLC, as necessary and
the [divestiture] shall be completed by December 31, 2009.
A. La Mesa’s First Appeal
2
{5} On May 4, 2010, the Board held a special meeting to consider whether to take action
against La Mesa for its failure to satisfy Conditions 2 and 3 of the conditional gaming
license. The Board made findings that in La Mesa’s original application for the gaming
license, La Mesa represented its casino would open by September 2009; that it thereafter
represented its casino would open on or before January 31, 2010; and that it subsequently
represented it would open the casino by the end of April 2010. The Board further noted that
on March 4, 2010, it had placed an additional condition on the gaming license that the casino
be open for gaming on or before May 1, 2010. The Board determined: (1) La Mesa failed
to satisfy Conditions 2 and 3 under which the conditional gaming license was issued; (2) La
Mesa failed to satisfy the additional condition that the facility be open on or before May 1,
2010; and (3) that the gaming license expired because a gaming license is only valid for one
year and must be renewed annually, and La Mesa had failed to timely submit a proper
renewal application, accompanied with the proper fee.
{6} The Board denied the conditional gaming license granted to La Mesa on June 11,
2009, for failure to meet Conditions Nos. 2 and 3 and ordered that the license was deemed
void, effective immediately. In the alternative, the Board directed that an administrative
complaint be filed to revoke the conditional gaming license because La Mesa failed to meet
the condition that it be open for gaming by May 1, 2010. Finally, the Board concluded that
the gaming license had expired because La Mesa failed to timely submit a complete renewal
application, together with the proper fees.
{7} On June 3, 2010, La Mesa appealed from the Board’s May 4, 2010 order and
requested a hearing pursuant to Section 60-2E-59(A) (“Any person aggrieved by an action
taken by the [B]oard or one of its agents may request and receive a hearing for the purpose
of reviewing the action.”). The Board appointed a hearing officer to conduct the hearing.
See § 60-2E-59(B)(2) (stating that the Board shall adopt regulations for the appointment of
a hearing officer to conduct the hearing and make recommendations to the Board not more
than thirty days after the hearing is completed). The positions of the Board and La Mesa
were presented at the hearing by their respective attorneys.
{8} The Board filed a motion to dismiss the appeal with prejudice on August 9, 2010, on
the basis that La Mesa’s gaming license was void as a matter of law because La Mesa had
not run any live horse races during its 2010 licensed race meet, and La Mesa had no actual
ability to run live horse races for the remainder of its 2010 race meet. See § 60-2E-27(B)(2)
(providing that unless a statutory exception applies, a racetrack’s gaming operator’s license
“shall automatically become void” if “the racetrack fails to maintain a minimum number of
four live race days a week with at least nine live races on each race day during its licensed
race meet”). The Board argued that because the gaming license was void, La Mesa’s appeal
of the Board’s revocation of the license was moot. In response, La Mesa argued that because
La Mesa had filed a request with the Racing Commission to vary its live racing dates, it
satisfied a statutory exception for maintaining fewer than the required number of racing days
or races. See § 60-2E-27(F) (stating that obtaining written approval from the Racing
Commission to vary the minimum number of live race days or races, when the variance is
3
due to specified reasons, does not constitute maintaining fewer than four live race days or
the minimum number of live races on each race day).
{9} The hearing officer held a hearing on the motion to dismiss on September 17, 2010.
The Board and La Mesa were given a full opportunity to present testimony, submit exhibits,
and make arguments in support of their respective positions. At the hearing, it was
undisputedly established that La Mesa held no horse races during its scheduled race meet
from May 28, 2010, to September 6, 2010. Further, evidence was presented that La Mesa
had no ability to hold live horse races at Raton because it had none of the facilities necessary
to conduct live horse racing. “[T]here are no barns built, there is no grandstand, there is no
furnished track, no rail, no infield, no paddock nor any jockey’s quarters.” In addition, the
director of the Racing Commission testified that the Racing Commission had not granted
approval to La Mesa to change its race dates and that the original race meet lasting from May
28, 2010, to September 6, 2010, was still in effect.
{10} Based on this evidence, the hearing officer concluded that La Mesa had failed to hold
the required live races and that La Mesa had not established an exception under Section 60-
2E-27(F). Thus, the hearing officer concluded that Section 60-2E-27 rendered La Mesa’s
gaming license void and recommended that the Board dismiss La Mesa’s appeal as moot.
The Board adopted the hearing officer’s recommendation in a decision and order dated
October 27, 2010, and dismissed La Mesa’s appeal. La Mesa now appeals to this Court
pursuant to Section 60-2E-60(A).
B. La Mesa’s Second Appeal
{11} While the first appeal was pending, the Board’s executive director sent La Mesa a
letter on August 9, 2010, notifying La Mesa that pursuant to Section 60-2E-27(B)(2), its
gaming license was automatically void due to its failure to hold live races during its licensed
meet. La Mesa appealed from this determination as well and requested a hearing. The same
hearing officer who presided over the first appeal was appointed to preside over the hearing
on this appeal, and the same attorneys also appeared on behalf of the Board and La Mesa.
{12} In this appeal, La Mesa contended that the Board’s executive director did not have
authority to declare that La Mesa’s gaming license was invalid without action by the Board.
La Mesa further argued that any contention that its gaming license was void under Section
60-2E-27(B)(2) was premature, because on March 18, 2010, it had applied to the Racing
Commission for a variance of its minimum number of race days or races, and the Racing
Commission had not yet made a ruling on the request. La Mesa said that on April 15, 2010,
the Racing Commission had tabled the variance request and that a hearing on its request was
scheduled for December 21, 2010, before the Racing Commission’s hearing officer.
{13} On October 27, 2010, the Board filed a motion for summary judgment. The basis
was that under the doctrine of res judicata, La Mesa was bound by the Board’s decision in
the first appeal in which the Board determined that La Mesa’s gaming license was
4
automatically void under Section 60-2E-27(B)(2). The Board subsequently filed a
supplemental submission in support of the recommendation for summary judgment. This
consisted of legal arguments concerning the executive director’s authority to send La Mesa
the August 9, 2010 letter notifying La Mesa that its gaming license was automatically void
due to its failure to hold live races during its licensed meet, and an order of the Board dated
January 6, 2011, in which the Board affirmed and ratified the authority of the executive
director to make the determination set forth in his August 9, 2010 letter to La Mesa. In
addition, the Board submitted an affidavit of the Board’s executive director stating that La
Mesa had not provided to the Board written approval from the Racing Commission allowing
La Mesa to vary its minimum number of live race days or races.
{14} The hearing officer held a hearing on the motion for summary judgment on
November 23, 2010. The Board and La Mesa were both represented by counsel and were
once again given a full opportunity to present testimony, submit exhibits, and make
arguments in support of their respective positions. On January 31, 2011, the hearing officer
issued his recommendation in the second appeal. The hearing officer found that the
executive director had authority to send La Mesa the August 9, 2010 letter, or in the
alternative, that the Board had affirmed and ratified the determination made by the executive
director in the August 9, 2010 letter. Further, the hearing officer recommended that under
the doctrines of res judicata or collateral estoppel, the Board grant summary judgment
against La Mesa, or in the alternative, dismiss La Mesa’s second appeal because La Mesa’s
gaming license was automatically voided by Section 60-2E-27(B)(2). The Board accepted
the hearing officer’s recommendation in an order dated February 28, 2011. La Mesa also
appeals from this order of the Board pursuant to Section 60-2E-60(A).
II. ANALYSIS
{15} La Mesa contends that the Board erroneously concluded that its gaming license was
void and consequently erred in dismissing its first appeal as moot and that the summary
judgment entered by the Board on its second appeal must be reversed. We will set aside
administrative action of the Board only if it is “(1) arbitrary, capricious or an abuse of
discretion; (2) not supported by substantial evidence in the whole record; or (3) otherwise
not in accordance with law.” Section 60-2E-60(B). In addition, we note that the Board
made extensive findings of fact in support of its conclusions and that La Mesa does not
challenge those findings of fact on appeal. We therefore deem the Board’s findings of fact
binding on appeal. Cf. Alfred v. Anderson, 86 N.M. 227, 228, 522 P.2d 79, 80 (1974)
(stating that where the district court findings are not attacked on appeal as inaccurate,
incomplete, or inadequate, they are binding on appeal).
A. Dismissal of La Mesa’s First Appeal as Moot
{16} The Board dismissed La Mesa’s first appeal as moot on the grounds that no relief
could be granted to La Mesa because its gaming license had been rendered void by Section
60-2E-27(B)(2). On appeal, La Mesa asserts that its gaming license was not void due to an
5
exception contained in the same statute. Because these arguments require statutory
interpretation, our review is de novo. See Att’y Gen. v. N.M. Pub. Regulation Comm’n,
2011-NMSC-034, ¶ 10, 150 N.M. 174, 258 P.3d 453 (“Statutory interpretation is an issue
of law, which we review de novo.” (internal quotation marks and citation omitted)).
{17} We begin with the language of the statute. Section 60-2E-27(B)(2) in pertinent part
states: “A racetrack’s gaming operator’s license shall automatically become void if . . . the
racetrack fails to maintain a minimum of four live race days a week with at least nine live
races on each race day during its licensed race meet, except as provided in Subsection F of
this section.” (Emphasis added.) The plain language of Section 60-2E-27(B)(2)
automatically voids a gaming license if the licensee fails to hold the requisite number of live
horse races during its race meet, unless Subsection F applies. See Att’y Gen., 2011-NMSC-
034, ¶ 10 (stating that in construing statutes, “[w]e follow classic canons of statutory
construction, looking first to the plain language of the statute, giving the words their ordinary
meaning, unless the Legislature indicates a different one was intended.” (internal quotation
marks and citation omitted)). La Mesa does not dispute that it failed to hold the number of
live race days or races required by Section 60-2E-27(B)(2).
{18} However, La Mesa contends that its gaming license is not automatically void
pursuant to Section 60-2E-27(F)(6), which provides:
F. Maintaining fewer than four live race days or nine live
races on each race day during a licensed race meet does not constitute a
failure to maintain the minimum number of live race days or races as
required by Paragraph (2) of Subsection B of this section if the licensee
submits to the board written approval by the state racing commission for
the licensee to vary the minimum number of live race days or races, and
the variance is due to:
....
(6) any other act, event or occurrence that the board finds
is not within the control of the licensee even with the exercise of
reasonable diligence or care.
(Emphasis added.) La Mesa argues that Section 60-2E-27(F)(6) applies because it
submitted a request to the Racing Commission to vary its minimum number of race days or
races, which was at first tabled by the Racing Commission and then set for a hearing before
its hearing officer. La Mesa further asserts that the applicable “other act, event or
occurrence” was due to the failure of one of its contractors to have a proper license, resulting
in a delay in building a portion of the racing and gaming facilities imposed by the New
Mexico Construction Industries Division. See § 60-2E-27(F)(6). Thus, La Mesa asserts that
the Board was premature in ruling that the gaming license was void before the Racing
6
Commission ruled on its variance request and that the gaming license was not rendered void
by Section 60-2E-27(B)(2). We disagree.
{19} The plain meaning rule of statutory construction requires us to give effect to the
language of a statute and refrain from further interpretation when the language used in the
statute is clear and unambiguous. See Marbob Energy Corp. v. N.M. Oil Conservation
Comm’n, 2009-NMSC-013, ¶ 9, 146 N.M. 24, 206 P.3d 135. To prevent its gaming license
from becoming automatically void, Section 60-2E-27(F)(6) clearly and unambiguously
required La Mesa to submit to the Board written approval obtained from the Racing
Commission to vary the number of its live race days or races, and La Mesa failed to submit
the required approval to the Board. We acknowledge that La Mesa submitted its variance
request to the Racing Commission in March 2010, before the meet ended and that the Racing
Commission, for reasons not disclosed by the record, tabled the variance request and then
set it for hearing before a hearing officer in December 2010. However, the undisputed fact
is that when the Board’s hearing officer heard the motion to dismiss the first appeal on
September 17, 2010, La Mesa had no track, no rail, no infield, no paddock, no jockey’s
quarters, no grandstand, and could not conduct live horse racing. As of September 17, 2010,
the race meet had already expired, and the statute says nothing about the effect of a variance
request that is pending before the Racing Commission after the meet has already expired.
The undisputed fact is that La Mesa did not obtain written approval from the Racing
Commission to vary its minimum number of live race days or races. We therefore affirm the
Board’s conclusion that Section 60-2E-27(F)(6) is inapplicable and that Section 60-2E-
27(B)(2) rendered La Mesa’s gaming license automatically void when La Mesa failed to
maintain a minimum number of four live race days a week with at least nine live races on
each day during its licensed race meet.
{20} La Mesa argues that the issues in its first appeal are not moot because its gaming
license could be reinstated by the Board, which would then revive the same issues raised in
the first appeal. See 15.1.10.42(F) NMAC (2/28/2005) (amended 12/15/2010) (“Voiding of
a license by the [B]oard pursuant to Section 60-2E-27(B) of the act and these rules does not
constitute a denial, permanent suspension or revocation of the license for cause by the
[B]oard or a limiting action by the [B]oard on the gaming operator licensee.”). We disagree.
A case is rendered moot “when no actual controversy exists, and the court cannot grant
actual relief.” Gunaji v. Macias, 2001-NMSC-028, ¶ 9, 130 N.M. 734, 31 P.3d 1008(internal quotation marks and citations omitted). It is completely speculative whether La
Mesa’s racing license will be reinstated by the Board in the future and what circumstances
will exist between the parties at that time. La Mesa offered no evidence at the hearing or on
appeal that it had reapplied for a license or was otherwise entitled to reinstatement of its
license. Thus, we affirm the Board’s dismissal of the first appeal as moot.
B. The Entry of Summary Judgment on La Mesa’s Second Appeal
{21} La Mesa’s second appeal arose when it appealed from the letter sent by the director
of the Board notifying La Mesa that its gaming license was rendered void by Section 60-2E-
7
27(B)(2). Two issues were raised by La Mesa in the second appeal: (1) whether the gaming
license was void under Section 60-2E-27(B)(2) when the Racing Commission had tabled La
Mesa’s request for variance of its race dates; and (2) whether the director had the authority
to unilaterally conclude the license was void without the Board’s action. See
15.1.10.42(D)(1) NMAC (providing that “[u]pon the determination by the [B]oard that a
racetrack gaming operator licensee has failed to maintain the minimum number of live race
days or races as required by the act and these rules: (1) the gaming operator’s license shall
become automatically void and of no legal effect”). The Board again concluded that La
Mesa’s gaming license was automatically void under Section 60-2E-27(B)(2). Additionally,
the Board ruled that res judicata barred La Mesa from again arguing in the second appeal
whether the gaming license was rendered void by Section 60-2E-27(B)(2). Finally, the
Board determined that the director had the authority to notify La Mesa that its gaming
license had become void. We address the issues in turn.
{22} “Summary judgment is appropriate where there are no genuine issues of material fact
and the movant is entitled to judgment as a matter of law.” Self v. United Parcel Serv., Inc.,
1998-NMSC-046, ¶ 6, 126 N.M. 396, 970 P.2d 582. “We review these legal questions de
novo.” Id.{23} We have already concluded that Section 60-2E-27(B)(2) automatically voided La
Mesa’s gaming license because La Mesa failed to hold live horse races and failed to satisfy
the exception enumerated in Section 60-2E-27(F)(6). La Mesa has presented no additional
disputed facts requiring further analysis, and we therefore conclude that the Board properly
granted summary judgment against La Mesa in the second appeal. Because summary
judgment was properly granted on this issue, we deem it unnecessary to determine whether
the Board correctly ruled that res judicata also required dismissal of La Mesa’s second
appeal.
{24} Moreover, the issue pertaining to the authority of the director to send the letter to La
Mesa has been rendered moot. It is undisputed that after the director sent La Mesa the letter,
the Board approved and ratified the director’s action in stating that La Mesa’s gaming
license was void. See Bd. of Cnty. Comm’rs v. Chavez, 2008-NMCA-028, ¶ 17, 143 N.M.
543, 178 P.3d 828 (“Ratification is the adoption or confirmation by a principal of an
unauthorized act performed on its behalf by an agent.” (internal quotation marks and citation
omitted)). Thus, even if we assume that the director had no authority to determine on his
own that La Mesa’s gaming license was void, the Board’s approval and ratification of the
director’s act renders La Mesa’s argument moot. See Chavez, 2008-NMCA-028, ¶¶ 1, 21-22
(concluding that summary judgment was properly granted on a claim alleging that the mayor
took unauthorized unilateral action because it was undisputed that the city council
subsequently ratified the mayor’s action).
III. CONCLUSION
8
{25} We hold that the Board’s action in dismissing both appeals was not arbitrary,
capricious, or contrary to law and was based on substantial evidence in the whole record.
It is therefore unnecessary for us to address any other issues raised by La Mesa. The orders
of the Board are affirmed.
{26} IT IS SO ORDERED.
____________________________________
MICHAEL E. VIGIL, Judge
WE CONCUR:
____________________________________
JONATHAN B. SUTIN, Judge
____________________________________
LINDA M. VANZI, Judge
Topic Index for La Mesa Racetrack & Casino v. NM Gaming Control Board, Docket Nos.
31,156/30,862
ADMINISTRATIVE LAW AND PROCEDURE
Administrative Appeal
Arbitrary and Capricious Actions
Judicial Review
Sufficiency of Evidence
CIVIL PROCEDURE
Summary Judgment
MISCELLANEOUS STATUTES
Horse Racing Act
STATUTES
Interpretation
Legislative Intent
9