Rohan v. Detroit Racing Ass'n

Decision Date10 April 1946
Docket NumberNo. 45.,45.
Citation22 N.W.2d 433,314 Mich. 326
PartiesROHAN et ux. v. DETROIT RACING ASS'N et al.
CourtMichigan Supreme Court

OPINION TEXT STARTS HERE

Appeal from Circuit Court, Wayne County, in Chancery; Guy A. Miller, judge.

Suit by Edward J. Rohan and Josephine Rohan, his wife, against the Detroit Racing Association, the Michigan State Racing Commission, and the Department of Agriculture of the State of Michigan to enjoin the operation of a race track at the state fair grounds and to have the statute creating racing conditions declared unconstitutional. Decree for plaintiffs, and defendants appeal.

Decree vacated and decree entered in accordance with opinion.

BOYLES, J., BUTZEL, C. J., and NORTH, J., dissenting in part.

Before the Entire Bench.

George E. Day and Arnold F. Zeleznik, both of Detroit (Bert D. Chandler, of Hudson, of counsel), for plaintiffs.

David H. Crowley, of Detroit, for defendant and appellant Detroit Racing Ass'n.

John R. Dethmers, Atty. Gen., Edmund E. Shepherd, Sol. Gen., of Lansing, and Ben H. Cole, and Daniel J. O'Hara, Asst. Attys. Gen., for appellants.

STARR, Justice.

Defendants appeal from a decree which determined, among other things, that Act No. 199, Pub. Acts 1933, as amended,1 was unconstitutional, and which permanently enjoined defendants from conducting horse-racing meets with pari-mutuel betting at the State fair grounds in Detroit.

The material facts are not in dispute. Plaintiffs Edward J. Rohan and wife have owned and occupied their private residence property on the south side of west State Fair avenue in Detroit for about 19 years. The Michigan State fair grounds are located directly across the street from plaintiffs' residence. In April, 1921, the Michigan State Agricultural Society conveyed said fair grounds to the State of Michigan. Thereafter, and until about 1934, the grounds were used for the conducting of an annual State fair and for other purposes. 1 Comp.Laws 1929, § 5004, Stat.Ann. § 12.4,2 provides in part:

‘The control of all lands and other property that now is, or hereafter may be, vested in the state of Michigan, or in the people of said state, for the purpose of holding and conducting agricultural and industrial fairs, and for other agricultural purposes, is hereby placed in the state department of agriculture.’

In 1933 the legislature adopted Act No. 199, and the constitutionality of that act as amended is involved in the present case. It provided that the terms ‘commissioner’ and ‘commission’ should be construed to mean the Michigan racing commissioner, and in this opinion we shall use the term ‘commissioner.’ The act created the office of racing commissioner, provided for his appointment and for the employment of a secretary and necessary assistants. It defined the powers of the commissioner and authorized him to prescribe the rules, regulations, and conditions under which all horse racing should be conducted in Michigan, and also rules governing and regulating betting on horse races. It also provided that the commissioner should fix admission fees and regulate the size of the purses, stakes or rewards to be offered. Section 8 of the act prohibited any person from holding a horse-racing meet for a stake, purse or reward unless licensed by the commissioner. Section 9, after providing for the issuance of licenses to conduct horse-racing meets, further stated as follows:

‘The commission shall issue no license or award any dates for racing on any tracks or places for holding races in Michigan, unless such tracks or places have been used for horse racing: Provided, That the Detroit area shall be permitted one new track within twenty-five miles of the corporate limits of the city of Detroit, and one new track more than twenty-five miles and less than forty miles from Wayne county, which shall be eligible for license under this act in the discretion of the commission: Provided, however, That if the Michigan state fair track is unavailable or inadequate properly to accommodate such horse racing in the opinion of the commission, then the commission may grant license for not more than two new tracks located not more than twenty-five miles from the corporate limits of the city of Detroit. The intent and purpose of the above provisos is that no new or additional tracks or places for holding races shall be licensed or awarded dates for holding or conducting races and thus bring into profitable use the state, district and county fair tracks of this state. The state department of agriculture is hereby authorized to lease on behalf of the state, for the conduct of horse racing and other lawful purposes, any lands subject to the control of the said department of agriculture, said lease to be subject to the approval of the state administrative board.’

Section 13 of the act provided that any licensee conducting a horse-racing meet may provide a place in the race-meeting enclosure for the conducting and supervision of the pari-mutuel system of wagering, and further provided that the parimutuel system ‘shall not under any circumstances be held or construed to be unlawful, other statutes of the state of Michigan to the contrary notwithstanding.’ Section 14 provided that no other place or method of betting shall be permitted by the licensee of the race track. It also provided that the licensee could retain as a commission the ‘breaks' and not less than 6 and not to exceed 7 1/2 per cent. of the money wagered. This section was amended by Act No. 56, Pub.Acts 1944, 1st Ex.Sess.3 to provide that the licensee could retain as a commission the breaks ‘computed at 5 cents,’ and also 10 per cent. of the money wagered. Section 16 of the act provided that any applicant for a license to hold horse races should pay a license tax to be fixed by the commissioner and that for running races on mile tracks in the Detroit area the tax should be not less than $2,500 nor more than $5,000 for each day of racing. This section was amended by Act No. 56, Pub.Acts 1944, 1st Ex.Sess., and Act No. 289, Pub.Acts 1945,4 to read in part as follows:

‘Each licensee under this act shall pay a daily racing tax in accordance with the following schedule for the various types of racing, and in such manner and time as the commission shall require: * * *

‘For running races the license tax shall be:

State Pari-mutuel Tax.

‘2% of the pari-mutuel pool up to $200,000.

‘6% of the pari-mutuel pool over $200,000 and up to $400,000.

‘8% of the pari-mutuel pool over $400,000.’

In pursuance of the above-quoted provision in section 9 of the act, the State department of agriculture on December 18, 1934, leased a portion of the State fair grounds to defendant Detroit Racing Association for the period from May 1, 1935, to November 1, 1948, at an annual rental of $12,000. In addition to the above rental, the lease further provided that the lessee would ‘conduct horse racing on the * * * premises for not less than 60 days in each year of the term of this lease, and pay therefor a license fee of $2,500 per day.’ This lease was approved by the State administrative board. In August, 1939, it was amended in some particulars not important to decision in the present case. About 1934 defendant Detroit Racing Association rebuilt the grand stand and built nine horse barns on the premises which it leased from the department of agriculture, and in 1935 it built two additional barns. These 11 barns were located two to three hundred feet north of a wire fence which marked the southern boundary of the fair grounds along west State Fair avenue. Since 1934 the association has annually conducted horse-racing meets on the premises, and has operated the so-called parimutuel system of betting on the races. Under this system bets are made on horses through ticket-selling machines leased or owned by the racing association. Bets made through these machines are relayed to a central control room where employees manually determine the approximate odds on the horses running, which odds are posted on a field board for observation by patrons of the race track. The computation of odds, the amount to be paid upon each ‘win,’ and the total amount paid upon each race are checked by auditors employed by defendant racing commissioner. Each day during the racing meet the amounts due the State and defendant racing association from the proceeds of the pari-mutual betting are determined. The races are conducted under rules and regulations prescribed by the racing commissioner.

The two barns built in 1935 were destroyed by fire in 1944, and defendant racing association began the construction of a new barn at a point 35 to 50 feet north of the wire fence along west State Fair avenue. In Ausust, 1944, while the erection of this new barn was in progress, plaintiffs filed bill of complaint in the present suit, naming the Michigan State racing commission and the Detroit Racing Association as defendants. In their bill they alleged that the construction and use of the new barn would subject them to odors, noise, and other unpleasantness; would create a fire menace to their property; and would create a public and also a common nuisance. They sought a decree determining that Act No. 199, Pub.Acts 1933, was unconstitutional and void; and that the construction and use of the new barn created a public and common nuisance. They asked that defendants be permanently enjoined from constructing and maintaining said barn for the housing of horses and from operating said race track. Upon the filing of this bill the trial court ordered defendants to show cause why a temporary injunction should not be issued as prayed for. The defendants named in the bill filed answers denying in substance that the operation of the race track and the construction and use of the new barn constituted a fire hazard or a common and public nuisance. They denied plaintiffs' right to injunctive relief and asked that the bill be dismissed.

On September 1, 1944, plaintiffs filed an amended bill in which they added the...

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