Iris Amusement Corp. v. Kelly

• Decision Date: 03 June 1937
• Docket Number: Gen. No. 24041.
• Citation: 8 N.E.2d 648,366 Ill. 256
• Parties: IRIS AMUSEMENT CORPORATION et al. v. KELLY et al.
• Court: Illinois Supreme Court

366 Ill. 256

8 N.E.2d 648

IRIS AMUSEMENT CORPORATION et al.

v.KELLY et al.

Gen. No. 24041.

Supreme Court of Illinois.

April 16, 1937.

Rehearing Denied June 3, 1937.

Suit for injunction by the Iris Amusement Corporation against Edward J. Kelly and others, wherein Balaban & Katz corporation and others intervened as coplaintiffs. From a decree of dismissal, the plaintiff and the interveners appeal.

Affirmed.Appeal from Superior Court, Cook County; Grover C. Niemeyer, judge.

Edmund D. Adcock, Edward Blackman, Arthur Goldberg, and John W. Day, all of Chicago, for appellants.

Barnet Hodes, Corporation Counsel, of Chicago (Joseph F. Grossman, Charles P. Horan, and William V. Daly, all of Chicago, of counsel), for appellees.

SHAW, Justice.

The Iris Amusement Corporation filed its amended complaint for injunction in the superior court of Cook county, seeking to restrain the mayor and commissioner of police of the city of Chicago from interfering with its conducting a gift enterprise known as ‘Bank Night.’ Afterwards, the Balaban & Katz corporation and several other theater owners intervened as coplaintiffs and they will all be referred to as the plaintiffs. The defendants filed a motion to strike the amended complaint for insufficiency, specifying seven particulars wherein it was said to be deficient, which motion was sustained by the trial court and the complaint dismissed for want of equity. The trial judge has certified that the validity of a municipal ordinance is involved, and that the public interest requires the appeal in the case to be taken directly to this court. The record is before us for review on such direct appeal.

The decision of the case having turned on the pleadings alone, we will state them with some particularity. The amended complaint alleged the original plaintiff's ownership and operation of a certain motion picture theater in Chicago, and the intervening plaintiffs allege the operation of thirty or more other picture houses similarly situated. It was alleged that plaintiffs held licenses from the city of Chicago pursuant to section 1901 of the Municipal Code, which, in part, is as follows:

‘All licenses for entertainment of any of the foregoing classes (motion picture theatres being included) shall contain a proviso that no gaming, raffle, lottery, or chance distribution of money, gift or article of value, shall be connected therewith or allowed by the person obtaining such license, or in any wise permitted to be held out as an inducement to visitors;’ etc.

‘When any licensed person or corporation shall be charged with having violated the provisions of his or its license as aforesaid, the mayor is directed to give the parties accused reasonable notice thereof and to inquire into the truth of said charge, and if the accusation be sustained to his satisfaction he may revoke the license of any such person or corporation, and every such person or corporation so offending shall be subject to a penalty of not more than one hundred dollars.’

Plaintiffs allege that approximately 150 theaters in Chicago have adopted an advertising plan known as ‘Bank Night,’ the operation of which is alleged in the pleadings and plaintiffs' brief to be as follows:

‘In operating Bank Night, thousands of persons outside of the theatre in the surrounding neighborhood of the theatre registered their names in certain books kept for this purpose. Each name registered in the books was given a number. Patrons attending the theatre from time to time are also permitted to register their names in said book kept for the same purpose, which patrons who have so registered are also given a number. Any one desiring to register in said books may do so without paying admission or giving any consideration of any kind therefor. Duplicates of the numbers appearing in said registration book are placed on a small ticket approximately an inch square and all of said numbers contained on said tickets are placed in a small container. All persons whose names are so registered in said registration book, whether said registration was obtained outside of the theatre or in the theatre are notified that on certain days during the performance at a certain hour one of the tickets in said receptacle will be drawn out by some person chosen from the audience of the theatre and that the person whose name is registered in the book having the number corresponding to the number on the ticket so drawn would be given a substantial cash prize by the theatre operator, varying in amounts, and the winner of said cash prize or Bank Night need not be a patron of said theatre. The winner is announced to the audience of said theatre and is also announced to all persons standing outside said theatre. Any person standing outside of said theatre whose number has been called as a winner of said Bank Night is admitted into the theatre without any admission price or cost to him and is given the cash prize. At no time does any person whose name is registered in the book, whether registered outside of the theatre or inside of the theatre, pay any consideration for having his name so registered in said registration book.

‘The seating capacity of plaintiff's theatre is approximately one thousand seats, and the number of names appearing upon the register books for Bank Night as above described, exceeds the said seating capacity several times. In operating said Bank Night only adults are permitted to register their names in said register books. Said Bank Night as described herein is in the belief of plaintiff not a violation of any of the statutes of the State of Illinois or any lawful ordinance of the city of Chicago.

‘In connection with the operation of Bank Night at plaintiff's theatre, it had placed a notice in a prominent position in the lobby outside its theatre, which notice is in words and figures as follows:

‘Notice.

‘If you are registered for Bank Night it is not necessary to purchase and admission ticket to claim the award should you be the winner, and anyone may register without paying admission. The name of the winner will be announced in the lobby and outside the theatre and the winner will be given three minutes in which to reach the stage to claim the award. The winner may enter the theatre free of charge in order to claim the award.

‘Plaintiff has operated, is operating and intends to continue to operate Bank Night at its said theatre as said Bank Night is described in the complaint, and intends to conduct drawings for Bank Night strictly in accordance with said notice and in accordance with the Bank Night system as above described.’

The complaint further alleges that the commissioner of police threatens to prevent the continued operation of the foregoing scheme and that if permitted to do so, the plaintiffs will suffer irreparable injury and damage to their business; that if section 1901 of the Municipal Code of Chicago is so interpreted as to prohibit Bank Night it would violate the Constitution of Illinois and of the United States and would deprive the plaintiffs of liberty and property without due process of law.

Defendants' motion to strike asserts the validity of section 1901, supra; insists that the licenses issued to plaintiffs are subject to all other ordinances of the city; that Bank Night violates the terms and conditions of the licenses; that Bank Night constitutes a chance distribution of money contrary to the provisions of the ordinance; that Bank Night will attract large crowds in front of the plaintiffs' theaters, thereby creating a public nuisance and interference with travel on the public streets and sidewalks, in violation of the ordinances of Chicago; that the requirement that the winner of the award must reach the stage inside of the plaintiffs' theaters within three minutes after the announcement of the winner, when such winner is in the crowd outside of the theater, would tend to create a disturbance of the peace and that the operation of Bank Night will tend to create congestion in and about the exits of the theaters and thereby create a fire hazard and menace to the lives of the patrons of the theaters.

For a reversal of the judgment plaintiffs advance several propositions of law, many of which do not require discussion in this opinion. Thus, they say that under the State and Federal Constitutions the city may not arbitrarily interfere with private business, or impose unnecessary restrictions upon lawful occupations unless the acts prohibited are detrimental to public health, safety, morals, or welfare; that conditions imposed under a municipal ordinance or license must have a reasonable relation to the police power, and that the question of the validity of an ordinance falling within the police power is a judicial question. Their main contention, and one upon which there appears to be some diversity of opinion among courts of different states, is as to whether or not the scheme described and outlined in the complaint, constitutes a lottery; whether, if it is not a lottery, it is an evasion of the lottery statute, and whether in any event plaintiffs have stated such a case as entitles them to the aid of a court of equity.

Our public policy in opposition to lotteries is ancient and is imbedded in our fundamental law. By section 35 of article 3 of our Constitution of 1848, it was provided that the Legislature should have no power to authorize lotteries for any purpose. In our Constitution of 1870, it is provided by section 27 of article 4, that ‘the general assembly shall have no power to authorize lotteries or gift enterprises for any purpose, and shall pass laws to prohibit the sale of lottery or gift enterprise tickets in this state.’ It will be observed that the Constitution of 1870 adds the words ‘gift enterprises,’ which were not found in the Constitution of 1848. Pursuant to this constitutional mandate the Legislature, without attempting any exact definition of the term ‘lottery,’ has made the setting up of a...