MS GAMING COM'N v. Imperial Palace of Mississippi, Inc., 97-CA-01083-SCT.

• Decision Date: 02 September 1999
• Docket Number: No. 97-CA-01083-SCT.,97-CA-01083-SCT.
• Citation: 751 So.2d 1025
• Parties: MISSISSIPPI GAMING COMMISSION, General Paul A. Harvey, In His Official Capacity as Executive Director of the Mississippi Gaming Commission, W.W. Gresham, Jr., Robert Engram and Victor P. Smith, All In Their Official Capacity as Commissioners of the Mississippi Gaming Commission v. IMPERIAL PALACE OF MISSISSIPPI, INC., a Nevada Corporation.
• Court: Mississippi Supreme Court

751 So.2d 1025

MISSISSIPPI GAMING COMMISSION, General Paul A. Harvey, In His Official Capacity as Executive Director of the Mississippi Gaming Commission, W.W. Gresham, Jr., Robert Engram and Victor P. Smith, All In Their Official Capacity as Commissioners of the Mississippi Gaming Commission v. IMPERIAL PALACE OF MISSISSIPPI, INC., a Nevada Corporation.

No. 97-CA-01083-SCT.

Supreme Court of Mississippi.

September 2, 1999.

Rehearing Denied February 24, 2000.

Office of the Attorney General by M. Carole Brand, Attorney for Appellants.

Britt R. Singletary, Biloxi, Attorney for Appellee.

EN BANC.

BANKS, Justice, for the Court:

¶ 1. This case presents, as a matter of first impression, the issue of whether the Mississippi Gaming Control Act of 1990, Miss.Code Ann. §§ 75-76-1 to -281 (1991 & Supp.1999), legalizes the operation of race book in licensed casinos. We conclude that there is no express exemption to the general prohibition against such activities and that the Gaming Commission's conclusion that race book is not permitted under the statute should be given deference. Accordingly, we reverse and render judgment in favor of the Gaming Commission.

I.

¶ 2. Appellee Imperial Palace of Mississippi, Inc. ("IPM"), a Nevada corporation, has been licensed by the Mississippi Gaming Commission (the Commission or MGC) to conduct a gaming establishment in Biloxi, Mississippi. On June 18, 1997, IPM wrote the Commission to request approval to establish race book on the premises of its new casino in Biloxi.¹ The Executive Director of the Commission, denied IPM's request on July 2, 1997, stating that:

Although section 75-76-89(2) of the Gaming Control Act provides that "[a] person who has been issued a gaming license may establish a sports pool or race book on the premises of the establishment at which he conducts a gaming operation only after obtaining permission from the executive director," section 75-76-33(3)(a) does not allow wagering "on the outcome of any event which does not take place on the premises." Because the races will be disseminated from a remote track, it does not appear that Imperial Palace can comply with section 75-76-33(3)(a).

¶ 3. On July 30, 1997, IPM filed a complaint in the Chancery Court of the Second Judicial District of Harrison County seeking a declaratory judgment authorizing IPM to operate a race book on the premises of its casino and directing the Commission to promulgate rules and regulations to regulate race book.

¶ 4. The Commission answered IPM's complaint on August 6, 1997 and joined IPM in asking the court to issue a declaratory judgment on the legality of the operation of race book in a licensed Mississippi casino.

¶ 5. A hearing on IPM's complaint and the Commission's answer was held on August 6, 1997. Several witnesses testified in support of legally permitting the operation of race book in licensed casinos in Mississippi. They were: Scott Scherer, a Nevada Assistant Attorney General, who at the request of the Mississippi Attorney General, acted as an expert advisor in the drafting of the Mississippi Gaming Control Act; a State Senator and a State Representative who testified concerning the legislative intent and history behind the act; Sam Begley, an attorney who researched and testified on the legislative history of the act; Jay Kornegay, Race and Sports Book Director of Imperial Palace of Las Vegas, Nevada; and Bill Eddington, Ph.D., Professor of Economics and Director of the Institute for the Study of Gambling and Professional Gaming.

¶ 6. On August 11, 1997, the chancery court issued its declaratory judgment and memorandum opinion declaring race book lawful in Mississippi. The court found the race book to be expressly authorized pursuant to Miss.Code Ann. §§ 75-76-55 & -89 (1991). The court further found that Miss.Code Ann. § 75-76-33(3)(a) does not apply to prohibit the Commission from granting permission to IPM to conduct race book on its premises.

¶ 7. From that judgment, the Commission appeals.

II.

¶ 8. The Commission raises the issue of whether the Mississippi Gaming Control Act of 1990 legalizes the operation of race book in licensed casinos, where races are disseminated from remote tracks. In reviewing the factual findings of a chancellor sitting without a jury, we apply the substantial evidence standard. We will not disturb those findings which are supported by substantial evidence unless the chancellor abused his discretion, was manifestly wrong, clearly erroneous, or applied an erroneous legal standard. Church of God Pentecostal, Inc. v. Free-will Pentecostal Church of God, Inc., 716 So.2d 200, 204 (Miss.1998). In reviewing the chancellor's legal conclusions, we apply a de novo standard and conduct a plenary review of all legal issues. Mississippi State Tax Comm'n v. Oscar E. Austin Trust, 719 So.2d 1172, 1173 (Miss.1998).

¶ 9. Miss.Code Ann. § 75-76-55 (1991) provides that it is unlawful to carry on any gambling activity, including race book, without first obtaining a gaming license. § 75-76-55, specifically states that:

(1) It is unlawful for any person, either as owner, lessee, or employee, whether for hire or not, either solely or in conjunction with others, without having first procured and thereafter maintaining in effect a state gaming license:

(a) To deal, operate, carry on, conduct, maintain or expose for play in the State of Mississippi any gambling game, including without limitation any gaming device, slot machine, race book, or sports pool;

(b) To provide or maintain any information service the primary purpose of which is to aid the placing or making of wagers on events of any kind; or

(c) To receive, directly or indirectly, any compensation or reward or any percentage or share of the money or property played, for keeping, running or carrying on any gambling game, including without limitation any slot machine, gaming device, race book or sports pool.

(2) It is unlawful for any person knowingly to permit any gambling game, including without limitation any slot machine, gaming device, race book or sports pool to be conducted, operated, dealt or carried on in any house or building or other premises owned by him, in whole or in part, by a person who is not licensed pursuant to this chapter or by his employee.

(Emphasis added). Miss.Code Ann. § 75-76-89(2) (1991), further provides, however, that:

(2) A person who has been issued a gaming license may establish a sports pool or race book on the premises of the establishment at which he conducts a gaming operation only after obtaining permission from the executive director.

(Emphasis added).

¶ 10. Relying on § 75-76-89(2), IPM sought permission from the Executive Director of the Commission to operate a race book on its licensed premises in Biloxi, Mississippi. The Executive Director denied IPM's request stating that Miss.Code Ann. § 75-76-33(3)(a) prohibited race book. That section provides that:

(3) Notwithstanding any other provision of law, each licensee shall be required to comply with the following regulations:

(a) No wagering shall be allowed on the outcome of any athletic event, nor on any matter to be determined during an athletic event, nor on the outcome of any event which does not take place on the premises.

Miss.Code Ann. § 75-76-33(3)(a) (Supp. 1999).

¶ 11. There are obvious conflict and ambiguity between several provisions of the Mississippi Gaming Control Act with regard to race books. Where statutes are ambiguous or in conflict with one another, it is proper to resort to the rules of statutory construction. The polestar consideration for this Court is legislative intent. In City of Jackson v. Lakeland Lounge of Jackson, Inc., 688 So.2d 742, 747 (Miss. 1996) (quoting Quitman County v. Turner, 196 Miss. 746, 759-60, 18 So.2d 122 (1944)), we said:

Legislative intent as an aid to statutory construction, although often elusive to the unaided vision, remains nevertheless the pole star of guidance ... We are not to construe clarity out of obscurity but intent out of inconsistency.... It is our duty to support a construction which would purge the legislative purpose of any invalidity, absurdity or unjust inequality.

¶ 12. In determining legislative intent we first look to the words used in the statute. "[w]hatever the legislature says in the text of the statute is considered the best evidence of the legislative intent." Pegram v. Bailey, 708 So.2d 1307, 1314 (Miss.1997) (quoting McMillan v. Puckett, 678 So.2d 652, 657 (Miss.1996) (Banks, J., dissenting)). It is only upon reading the two statutory provisions together that any ambiguity arises. It cannot be assumed, from a plain reading of the statutes, that race books are excluded from the general prohibition against betting on events which take place off premises, where § 75-76-33(3)(a), expressly prohibits betting on off premise events "notwithstanding any other provision of law." An exception must be clear from the language of the statute and cannot be created by construction. Mississippi Dep't of Wildlife, Fisheries & Parks v. Mississippi Wildlife Enforcement Officers' Ass'n, Inc., 740 So.2d 925, 931 (Miss.1999). If the Legislature had wanted to exempt race books from the prohibition, it could have done so by including language excluding race books. However, as it stands, the Legislature provided for no exemptions to the blanket prohibition against betting on off-site events.

¶ 13. In resolving the issue, the trial court relied on testimony as to legislative history and legislative intent. However, testimony below regarding the legislative history of the statute, does not aid in resolving the ambiguity. There was testimony to the effect that a proposed amendment to § 75-76-33(3)(a) (Supp.1999), which specifically prohibited horse and dog racing, was defeated, thereby, inferring that the Legislature's refusal to include specific prohibitions against horse and dog racing, indicates the legislative intent to allow race book....