Untitled Texas Attorney General Opinion ( 1990 )

THE ATTORNEY GENERAL
OF TEXAS
December 20, 1990
Honorable Terra1 Smith Opinion No. JM-1267
Chairman
Natural Resources Committee Re: Authority of the legisla-
House of Representatives ture to permit casino games of
P. 0. Box 2910 chance without a constitutional
Austin, Texas 78768-2910 amendment (RQ-2102)
Dear Representative Smith:
Article III, section 47, of the Texas Constitution
provides that the.legislature "shall pass laws prohibiting
lotteries and gift enterprises," while permitting the
holding of certain charitable bingo games and raffles. The
legislature has so provided, forbidding in chapter 47 of the
Penal Code the holding of lotteries. In addition, the
definitions and prohibitions set forth in chapter 47, which
proscribes "gambling`` as defined in that chapter, are broad
enough to effectively prohibit those types of games typical-
ly conducted in gambling casinos. See Searcy & Patterson
Practice Commentary, Tex. Penal Code g 47.02 (Vernon 1973).1
You ask about the proper construction of section 47 of
article III. Specifically you ask the following three
questions:
1. The Practice Commentary to section 47.02 provides
in pertinent part:
Section 47.02 as enacted appears to proscribe all
forms of gambling, from coinmatching and the weekly
football pool to lotteries and roulette to parimutuel
betting whether on track or with a bookie. As such
the section preserves, although with much greater
economy, the basic scheme of prior law that in Penal
Code arts. 615 to 618, 644, 645, and 646 to 652 out-
lawed most forms of gambling.
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Honorable Terre11 Smith - Page 2 (JM-1267)
1. May the legislature, without an amendment
to Article III, Section 47, of the Texas
Constitution, authorize any of the following
casino gambling games [in] this state:
(a) roulette;
(b) dice;
(c) slot machines; or
Cd) other games awarding a prize solely
by chance?
2. May the legislature, without an amendment
to Article III, Section 47, of the Texas Con-
stitution, authorize any of the following
casino gambling games in this state:
(a) poker;
(b) blackjack;
(c) sports pools: or
(d) other games involving an element of
skill?
3. May the legislature, without an amendment
to Article III, Section 47, of the Texas
Constitution, authorize casino gambling to
exist 9$& on Port Arthur's Pleasure Island?
There is no question that chapter 47 of the Penal Code
proscribes those gaming activities about which you ask. See
Penal Code 88 47.01, 47.02. The issue is whether those
gaming activities fall within the ambit of the phrase
"lotteries and gift enterprises" set forth in section 47 of
article III and are thereby prohibited by the Texas Consti-
tution. If they do, then the legislature may not authorize
those activities by amendins the Penal Code: if not, then it
may. &g 0, -494 S.W.Zd 866 (Tex. Crim. APP.
1973); barrv v. State, 45 S.W. 571 (Tex. Crim. App. 1898).
The Texas Constitutions of 1845, 1861, 1866, and 1869
each contained the following prohibition regarding lot-
teries:
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Honorable Terre11 Smith - Page 3 (JM-1267)
No lottery shall be authorized by this
State: and the buying or selling of lottery
tickets within this State is prohibited.
Tex. Const. art. XII, 5 36 (1869); Tex. Const. art. VII,
5 17 (1866): Tex. Const. art. VII, 5 17 (1861); Tex. Const.
art. VII, § 17 (1845). The constitution of 1876 contained
the following prohibition of lotteries set forth in section
47 of article III:
The Legislature shall pass laws pro-
hibiting the establishment of lotteries and
gift enterprises in this State, as well as
the sale of tickets in lotteries, gift enter-
prises or other evasions involving the
lottery principle, established or existing in
other States.
The addition of the language prohibiting 'I ift enterprises
or other evasions of the lottery principle" 9 apparently was
included in order to indicate the drafters' support of two
Texas Supreme Court cases that held that the 13th Legisla-
ture did not license the operation of "gift enterprises" by
- the enactment of an occupation tax on them and that a "gift
enterprise," as then understood, was essentially a lottery.3
See Randle v. State, 42 Tex. 580 (1875); State v. Randle, 41
Tex. 292 (1874); 1 G. Braden, The Constitution of the State
of Texas: An Annotated and Comnarative Analvsis 192 (1977).
2. It is apparent that the phrase was intended to
proscribe other forms of lotteries. See also Citv of Wink
v. Griffith Amusement Co., 100 S.W.2d 695 (Tex. 1936): State
V. Randle, 41 Tex. 292 (1874).
3. The licensing statute defined "gift enterprises" in
the following fashion:
Every person, firm, or corporation who shall sell
anything with a promise, either expressed or implied,
to give anything in consideration of such sale and
purchase, shall be regarded as the proprietor of a
gift enterprise.
Acts 1873, 13th Leg., ch. 121, 5 3, at 200.
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Honorable Terre11 Smith - Page 4 (JM-1267)
Section 47 of article III was amended in 1980 to permit
the operation of bingo games by charitable organizations and
again in 1989 to permit such organizations to hold raffles.
Acts 1989, 71st Leg., H.J.R. 32, 5 1; Acts 1979, 66th Leg.,
S.J.R. 18, § 1. Subsection (a) of section 47 of article III
of the Texas Constitution now provides the following:
The Legislature shall pass laws prohibit-
ing Lotteries and uift enternriseq-in this
State other than those authorized by Sub-
sections (b) and (d) of this section -[which
authorize the legislature to permit under
certain circumstances the conducting of
charitable bingo games and raffles]. (Em-
phasis added.)
The Texas Supreme Court has declared that section 47
was not intended to condemn merely lotteries, but was in-
tended also to condemn separately stated schemes, which were
not lotteries, but which involved the lottery principle, or
chance:
In general, it may be said that chance is
the basic element of a lottery. Unless a
scheme for the awarding of a prize requires
that it be awarded by a chance, it is not a
lottery. . . .
There are, however, in a lottery, accord-
ing to the authorities, three necessary
elements, namely, the offering of a prize,
the award of the prize by chance, and the
giving of a consideration for an opportunity
to win the prize. 38 C-J. p. 289, § 2. But
the ons tut'o inas which
f all sor
h t 0 f containina all the essential
elements of a lotterv. namelv. those thinas
which involve the lotterv nrincinle. of which
qII ce" 's itutes the
verv basis of a lotterv. and without which it
w ul
o. (Emphasis added.)
[
C't of W'n o., 100 S.W.2d 695, 701
(Tex. 1936).
But it is equally clear that the drafters did not
intend section 47 of article III to proscribe a forms of
gambling. During the drafting of the constitution, an
amendment to section 47 was offered to add the words "and
4
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Honorable Terre11 Smith - Page 5 (JM-1267)
shall pass laws prohibiting gambling of every character in
all places." The amendment was not adopted. 1875 Texas
Constitutional Convention, Journal of the Constitutional
Convention of the State of Texas, Begun and Held at the City
of Austin, September 6, 1875, at 269. Moreover, it is clear
that the term wlottery'* was not thought at the time that
section 47 was adopted to include all forms of gambling
either. See Panas V. Texas Breeder & Racina Ass'n 80
S.W.2d 1020 (Tex. Civ. App. - GalvesEon 1935, writ diAm#d)
(construing section 47 not to prohibit wagering on horse
races); State v. Rand&, 41 Tex. 292 (1874); V.T.C.S. art.
179e (creating the Texas Racing Commission and permitting
parimutuel wagering on horse races and greyhound races).
Texas courts uniformly have held that three elements
comprise a lottery:
(1) a prize in money or other thing of
value:
(2) its distribution by chance: and
(3) payment, either directly or indirectly,
of a valuable consideration for the chance to
win the prize.
Citv of Wink * Brice v. State, 242 S.W.Zd 433, 434
(Tex. Crim. ipp?%;) ; Cole v. State, 112 S.W.2d 725 (Tex.
Crim. App. 1937); State v. Soconv Mobil Oil Co., 386 S.W.Zd
169 (Tex. Civ. App. - San Antonio 1964, writ ref'd n.r.e.)i4
see also Attorney General Opinions JM-513 (1986); H-820
(1976).
With your first two questions, you ask whether a list
of gaming activities typically conducted in gambling casinos
falls within the ambit of the phrase "lotteries and gift
4. Subdivision (6) of section 47.01 of the Penal Code
defines *llottery" in the following fashion:
*Lottery' means any scheme or procedure whereby one or
more prizes are distributed by chance among persons
who have paid or promised consideration for a chance
to win anything of value, whether such scheme or pro-
cedure is called a pool, lottery, raffle, gift, gift
enterprise, sale, policy game, or some other name.
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Honorable Terre11 Smith - Page 6 (JM-1267)
enterprises." For purposes of this opinion, we assume that
two of the necessary three elements of a lottery would be
present during the holding of the gaming activities about
which you inquire, h, the payment of consideration and
the awarding of a prize. We understand you to ask whether
the necessary third element, the award of the prize by
chance, as opposed to an award determined by skill, would
also be present.
In Attorney General Opinion C-619 (1966), this office
was asked whether a certain referral selling plan called a
"representative purchasing commission agreement" constituted
a lottery. In discussing the necessary element of chance,
the opinion declared:
The second element, the distribution of the
prize by chance, requires a closer analysis
in the light of the decisions as to whether
the dominatina element of the entire scheme
was that of chance, or that of skill, judg-
ment , or ingenuity, 54 C.J.S. 846, Lotteries,
Sec. 2b(2), and cases cited. If the plan or
game depends entirely on skill, it is not a
lottery although prizes are offered for the
best solution. Boatriaht . State, 118 Tex.
Crim. 381, 38 S.W.Zd 87 71931). If chance
predominates over skill or judgment and per-
meates the whole plan, a lottery is estab-
lished. &.9rwood & Robert Yakima. I c
Clvde . Le 67 W.D.Zd :;8, 409 P.:d' 1:;
(Wash.GSup.azti5).
Id. at 5-6 (emphasis in original). m Adams v Antonio, 88
S.W.2d 503, 505 (Tex. Civ. App. - Waco 1935,'writ ref'd)
(dicta to the effect that gaming statute was violated in
instance in which chance predominates over skill): see also
Attorney General Opinions WW-222 (1957); V-1483 (1952);
V-544 (1948); V-238 (1947).
We conclude that the legislature, without amending
section 47 of article III of the Texas Constitution, may
amend chapter 47 of the Penal Code to permit the holding of
those gaming activities that do not constitute a lottery,
i.e., that do not comprise the elements of consideration, a
prize, and chance. Whether any of the gaming activities
about which you ask involves the dominating element of
skill, as opposed to chance, is a question of fact that
cannot be resolved in the opinion process. It is the
character of the game, and not the skill or want of skill of
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Honorable Terre11 Smith - Page 7 (JM-1267)
the player, that determines whether the game is one of skill
or chance. m w v. AntOnlQ m (authorities cited
therein). Therefore, we cannoi answer your first two
questions.
Your third question is whether the legislature may,
without amending section 47 of article III of the Texas
Constitution, permit the holding of those gaming activities
typically comprising casino gambling a in Port Arthur.
You have not provided us with a draft of any proposed
amendment to chapter 47 of the Penal Code. We do not
provide general guidance or answer speculative questions in
the opinion process. Accordingly, we decline to answer your
third question. We note, however, #at any amendment to
chapter 47 of the Penal Code that permitted in Port Arthur
alone the holding of otherwise proscribed gaming activities
should be considered in light of article III, section 56, of
the Texas Constitution.5 But see V.T.C.S. art. 179e,
9 6.14(c) (provides that each greyhound track licensed under
the act must be located in a county that has a population of
more than 190,000 according to the most recent federal
census, and that includes all or part of an island that
borders the Gulf of Mexico).
We conclude that the legislature may, without amending
section 47 of article III of the Texas Constitution, amend
chapter 47 of the Penal Code to authorize gaming activities
that do not constitute a lottery or gift enterprise, i.e.,
5. Article III, section 56, of the Texas Constitution
prohibits the legislature from enacting, except as provided,
local and special laws and provides in pertinent part:
The Legislature shall not, except as otherwise
provided in this Constitution, pass any local or
special law, authorizing:
. . . .
For limitation of civil or criminal actions:
. . . .
And in all other cases where a general law can be made
applicable, no local or special law shall be enacted.
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Honorable Terre11 Smith - Page 8 (JM-1267)
?
that do not comprise the three elements of consideration,
prize, and chance. Whether any specific gaming activity
involves the dominating element of skill, as opposed to
chance, is a question of fact that this office cannot
resolve in the opinion process. Therefore, we cannot answer
as a matter of law your first two questions. Because we do
not answer speculative questions in the opinion process, we
cannot answer your third question.
SUMMARY
The legislature, without amending section
47 of article III of the Texas Constitution,
may amend chapter 47 of the Penal Code to
authorize the holding of those gaming activ-
ities that do not comprise the elements of a
lottery, i.e., consideration, prize, and
chance. Whether any specific gaming activity
involves the dominating element of skill, as
opposed to chance, is a question of fact that
this office cannot resolve in the opinion
process. I .
JIM MATTOX
Attorney General of Texas
MARY KELLER
First Assistant Attorney General
LOU MCCREARY
Executive Assistant Attorney General
JUDGE ZOLLIE STEAKIEY
Special Assistant Attorney General
RENEA HICKS
Special Assistant Attorney General
RICK GILPIN
Chairman, Opinion Committee
Prepared by Jim Moel,linger
Assistant Attorney General
p. 6775