Playboy-Elsinore Associates v. Strauss

Decision Date22 February 1983
Docket NumberPLAYBOY-ELSINORE
Citation459 A.2d 701,189 N.J.Super. 185
PartiesASSOCIATES, Plaintiff, v. David L. STRAUSS, Defendant.
CourtNew Jersey Superior Court

Elliot L. Marvel, Tinton Falls, and Russell P. Goldman, Little Silver, for plaintiff (Elliott L. Marvel, Tinton Falls, attorney).

Howard W. Segal, Oradell, for defendant.

PERSKIE, J.S.C.

This matter presents for determination on first impression questions relating to the construction and application of that portion of the Casino Control Act which regulates the granting and issuance of credit at New Jersey casinos. 1 The parties have each moved for summary judgment, asserting the lack of any genuine issue of material fact. A review of the pleadings and affidavits submitted incident to the moving papers establishes that the issue is ripe for determination on a motion for summary judgment. R. 4:46-2; Judson v. People's Bank and Trust Co. of Westfield, 17 N.J. 67, 74, 110 A.2d 24 (1955).

The essential facts are not in dispute. On or about May 2, 1981 defendant applied for, and was granted, a "line of credit" at the casino hotel operated by plaintiff in Atlantic City. A "line of credit" approved by a casino hotel permits a patron to receive, in accordance with established statutory and regulatory procedures, "cash or cash equivalents" in exchange for a personal check issued to the casino hotel. In this instance defendant sought and received a line of credit in the amount of $40,000.

Thereafter, defendant issued eight checks drawn against this line of credit. Each of the eight checks was in the sum of $5,000. Two of such checks were executed on January 10, 1982, four on January 22, 1982 and the remaining two on January 26, 1982. Each of the eight checks was executed at the gaming table where the defendant was gambling, and each was subsequently deposited and presented for payment by plaintiff. Each of the eight checks was, in due course, returned to plaintiff by defendant's bank marked "insufficient funds," and plaintiff's complaint seeking collection of the $40,000 debt evidenced by the checks ensued.

Plaintiff has established that the procedure then (as now) in effect at its casino hotel for the issuance of credit had previously been submitted to, and approved by, the Casino Control Commission, in accordance with the provisions of the Casino Control Act requiring prior approval of all systems of internal procedures and administrative and accounting controls, including, with particularity, "procedures for the cashing and recordation of checks exchanged by casino patrons." 2 In relevant part, the procedure is as follows:

1. A patron at a gaming table who desires to request an advance against a previously established line of credit notifies the dealer, who calls the pit clerk (sometimes also called a casino clerk). This pit clerk, or casino clerk, is a part of the accounting department, not a part of casino operations, and is accountable to the accounting department.

2. A patron completes a request slip setting forth his name, his mother's maiden name (apparently for purposes of identification), patron's date of birth, and the amount of credit requested. The pit clerk checks to verify that credit in this sum is available.

3. A counter check is prepared by the clerk in the pit, either manually or by computer. The clerk completes the check except for the patron's signature, presents it to the patron, and receives the signed counter check from the patron.

4. The counter check is prepared in an original and four duplicates, each completed simultaneously. The original, a redemption copy, and an acknowledgment copy are each sent to the casino cashier through a pneumatic tube process. An accounting copy is retained by the pit clerk. The last copy, the "issuance copy", is given to the dealer or boxman, who lays it out on the table, exchanges the copy for chips, deposits the issuance copy into his cash drop box at the table, and transfers the chips in question to the patron.

The applicable portion of the statute 3 provides as follows:

No casino licensee ... may accept a check ... from any person to enable such person to take part in gaming activity as a player, or may give cash or cash equivalents in exchange for such check unless:

(1) The check is made payable to the casino licensee;

(2) The check is dated, but not post-dated;

(3) The check is presented to the cashier or his representative and exchanged only for a credit slip or slips which total an amount equal to the amount for which the check is drawn, which slip or slips may be presented for chips at a gaming table; and

(4) The regulations concerning check cashing procedures are observed by the casino licensee and its employees and agents.

The Casino Control Commission, pursuant to statutory mandate 4, has adopted regulations governing check cashing procedures. In relevant part, the regulations in effect in January 1982 provided as follows: 5

For Counter Checks exchanged at a gaming table, the casino clerk 6 shall:

1. Examine the patron's identification credentials or perform such other procedures as required by the Casino licensee to ensure the patron's identification.

2. Determine the patron's remaining check cashing limit from the cashiers' cage.

3. Prepare the Counter Check for a patron's signature by recording, at a minimum, on the face of the original and all duplicates of the Counter Check with the exception of the acknowledgment copy which shall only have recorded on it the game and table number, or in stored data, the following information:

i. The name of the patron exchanging the Counter Check;

ii. The name of the patron's bank (required on the original copy only);

iii. The current date and time;

iv. The amount of the Counter Check expressed in numerals;

v. The game and table number;

vi. The signature of the casino supervisor authorizing acceptance of the check; and

vii. The signature of the preparer or, if computer prepared, the identification code of the preparer.

4. Place an impression on the back of the original Counter Check a restrictive endorsement "for deposit only" to the casino licensee's bank account.

5. Present the original and all duplicate copies of the Counter Check to the patron for signature.

6. Receive the signed Counter Check directly from the patron; the issuance copy, which is the equivalent of a Check Credit Slip, of the Counter Check shall be immediately and directly given to the dealer or boxman. In no instance shall the chips or plaques be given to the patron prior to the receipt of the issuance copy of the Counter Check by the dealer or boxman.

i. The original, redemption and acknowledgment copies of the Counter Check shall be expeditiously transported to the cashiers' cage where the original and redemption copies shall be maintained and controlled by the Check Bank Cashier;

ii. The accounting copy of the Counter Check, if manually prepared, shall be maintained and controlled at all times by the casino clerk; and

iii. The issuance copy of the Counter Check shall be deposited by the dealer or boxman in the drop box immediately after the issuance of chips or plaques to the patron.

Defendant raises, in essence, three challenges to the procedures adopted, pursuant to regulatory mandate, by plaintiff. He argues that:

1. Inasmuch as the person receiving the check must be the cashier or his representative, the individual who received the check must be designated in some formal fashion by the cashier as a part of the cashier's department. Insofar as the regulation expressly permits (in fact, requires) the check to be delivered to the casino clerk, as opposed to the "cashier or his representative", the regulation is invalid.

2. The statute requires that a check be exchanged "only for a credit slip ..." The plaintiff's procedure, and the regulation with which the procedure is consistent, requiring the credit slip to go to the dealer or boxman rather than to the patron are both violative of the statutory language and therefore invalid.

3. The statute provides that a credit slip "may be presented for chips at a gaming table." The use of the word "may" suggests that the patron who receives the slip must be given the option to present the credit slip for chips, rather than be required to do so. To the extent that the regulation denies the patron the opportunity to make a decision as to whether the slip should be promptly exchanged for chips at the table, the regulation is invalid.

Plaintiff, in response, argues that both its procedures and the regulations pursuant to which the procedures were adopted are valid and in compliance with statutory requirements, and that defendant's checks are valid and enforceable under the provisions of the statute.

It is clear that the Casino Control Act prohibits the enforcement of any debt evidenced by a check "cashed, transferred, conveyed or given in violation of this act." N.J.S.A. 5:12-101(f). It is equally clear that our courts have insisted upon strict compliance with the statutory provisions, by reason of their comprehensive nature and by reason of the sui generis nature of these "gambling debts." Resorts International Hotel, Inc. v. Salomone, 178 N.J.Super. 598, 605, 429 A.2d 1078 (App.Div.1981). In the Salomone case some of the same questions presented here for decision were also raised, but were not decided in view of the determination that violations of subsections (b)(2) and (c) of the statute prevented enforcement of the debt evidenced by the checks. Salomone, supra at 602, 429 A.2d 1078.

It is by now axiomatic that the casino industry has been invited to participate in the commercial life of the State of New Jersey pursuant to a statutory scheme that holds the industry and its practices to strict compliance with comprehensive requirements designed to create and maintain "public confidence and trust in the credibility and integrity of the regulatory process and of...

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4 cases
  • GNOC, CORP. v. Endico
    • United States
    • U.S. District Court — Southern District of New York
    • September 2, 1988
    ...policy view toward gambling, and its courts will not assist in the collection of most gambling debts. Playboy-Elsinore Assoc. v. Strauss, 189 N.J.Super. 185, 459 A.2d 701 (A.D.1983); see also, Caribe Hilton Hotel v. Toland, 63 N.J. 301, 307, 307 A.2d 85 (1973) (reviewing the history of New ......
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    • United States
    • U.S. Court of Appeals — Second Circuit
    • May 31, 1989
    ...494 A.2d 294, 297 (1985); In re Adamar, 222 N.J. Super. 464, 537 A.2d 704, 707 (App.Div.1988); Playboy-Elsinore Assocs. v. Strauss, 189 N.J. Super. 185, 459 A.2d 701, 704-05 (Law Div.1983). The Act reads in Notwithstanding the provisions of any law to the contrary, checks cashed in conformi......
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    • United States
    • New Jersey Superior Court — Appellate Division
    • August 2, 1991
    ...scrupulous conduct by the casino industry and regulatory officials." ... Further, the Law Division in Playboy-Elsinore Assocs. v. Strauss, 189 N.J.Super. 185, 191 (Law Div.1983), noted that "practices and procedures involved with the extension of credit by the casinos are among the most sen......
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    • United States
    • New Jersey Superior Court — Appellate Division
    • January 19, 1988
    ...Greenberg v. Kimmelman, 99 N.J. 552, 560, 494 A.2d 294 (1985). Further, the Law Division in Playboy-Elsinore Assocs. v. Strauss, 189 N.J.Super. 185, 191, 459 A.2d 701 (Law Div.1983), noted that "practices and procedures involved with the extension of credit by the casinos are among the most......

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