State ex rel. Six v. Kansas Lottery

Decision Date27 June 2008
Docket NumberNo. 99,957.,99,957.
Citation186 P.3d 183
PartiesSTATE, EX REL. Stephen N. SIX, Attorney General, Appellant, v. KANSAS LOTTERY and Ed Van Petten, Appellees.
CourtKansas Supreme Court

Michael C. Leitch, deputy attorney general, argued the cause, and Steven W. Allton, assistant attorney general, was with him on the briefs for the appellant.

Dan Biles, of Gates, Biles, Shields & Ryan, P.A., of Overland Park, argued the cause and was on the briefs for the appellees.

Nathan D. Leadstrom, Wayne T. Stratton, and Arthur E. Palmer, of Goodell, Stratton, Edmonds & Palmer, L.L.P., of Topeka, were on the brief for amicus curiae Stand Up for Kansas, Inc.

David Prager, III, of Mayetta, and William P. Tretbar, Lyndon W. Vix, Stephen E. Robinson, and Brooks G. Kancel, of Fleeson Gooing Coulson & Kitch, LLC, of Wichita, were on the brief for amicus curiae Prairie Band Potawatomi Nation.

Michael J. Davis, of Stinson Morrison Hecker LLP, of Kansas City, Missouri, was on the brief for amicus curiae The Woodlands.

Teresa L. Watson and David R. Cooper, of Fisher, Patterson, Sayler & Smith, L.L.P., of Topeka, were on the brief for amici curiae Cherokee County, Kansas, and Sumner County, Kansas.

The opinion of the court was delivered by ROSEN, J:

This case comes before the court on a direct appeal pursuant to K.S.A.2007 Supp. 60-2102(b)(2). The appellant seeks review of an order of the district court upholding the constitutionality of the Kansas Expanded Lottery Act (KELA), K.S.A.2007 Supp. 74-8733 et seq.

This appeal asks us to resolve tension among the historical ban on lotteries contained in the Kansas Constitution, later amendments to the constitution that permit lotteries under certain circumstances, and recent legislative action seeking to increase state revenues by establishing supervised gambling venues. The issue before this court is narrow: Does the legislative scheme provide for a lottery that is owned and operated by the State of Kansas? An integrated study of the history of lotteries in Kansas, the language of the Kansas Constitution, the interpretation of similar laws in other states, and the legislative provisions contained in KELA leads us to conclude that KELA complies with the constitutional prohibitions and mandates.

Background

Since the admission of Kansas into the Union in 1861, art. 15, § 3, of the Kansas Constitution has provided: "Lotteries and the sale of lottery tickets are forever prohibited." A series of cases proceeded to define what constitutes a lottery. See, e.g., State ex rel. Kellogg v. Mercantile Association, 45 Kan. 351, 25 P. 984 (1891) (distribution of prizes by chance drawing is illegal lottery); In re Smith, Petitioner, 54 Kan. 702, 39 P. 707 (1895) (constitutional ban on sale of lottery tickets is self-executing); Davenport v. City of Ottawa, 54 Kan. 711, 39 P. 708 (1895) (purchase of goods entitling entry in chance drawing is illegal lottery); The State ex rel. Dawson v. Fair Association, 89 Kan. 238, 131 P. 626 (1913) (betting on horse races is gambling); State, ex rel. Beck v. Fox Kansas Theatre Co., 144 Kan. 687, 62 P.2d 929 (1936) (theater bank night is lottery even though no purchase required); City of Wichita v. Stevens, 167 Kan. 408, 207 P.2d 386 (1949) (punch boards are form of lottery); State v. Brown, 173 Kan. 166, 244 P.2d 1190 (1952) (punch boards constitute illegal lottery); State, ex rel. Moore v. Bissing, 178 Kan. 111, 283 P.2d 418 (1955) (parimutuel betting on dog racing is a lottery); State ex rel. Frizzell v. Highwood Service, Inc., 205 Kan. 821, 473 P.2d 97 (1970) (giveaway radio show involves no consideration; game is not a lottery); State v. Nelson, 210 Kan. 439, 502 P.2d 841 (1972) (slot machines are form of lottery).

In the 1974 general election, the state adopted a constitutional amendment permitting games of bingo to be conducted by certain nonprofit organizations. This amendment was later amended to allow instant bingo games. Kan. Const. art. 15, § 3a. On November 1, 1986, the citizens of Kansas voted to amend the Kansas Constitution to permit parimutuel wagering in horse and dog racing and to authorize a "state-owned and operated lottery." Sixty-four percent of Kansas voters approved the lottery amendment. The lottery amendment reads:

"Notwithstanding the provisions of section 3 of article 15 of the constitution of the state of Kansas, the legislature may provide for a state-owned and operated lottery, except that such state-owned lottery shall not be operated after June 30, 1990, unless authorized to be operated after such date by a concurrent resolution approved by a majority of all of the members elected (or appointed) and qualified of each house and adopted in the 1990 regular session of the legislature. The state shall whenever possible provide the public information on the odds of winning a prize or prizes in a lottery game." Kan. Const. art. 15, § 3c.

Following approval of the 1986 amendments, Kansas enacted legislation allowing horse and dog racing (K.S.A. 74-8801 et seq.) and enabling a state-owned and operated lottery (K.S.A. 74-8701 et seq.). In 1987, the legislature created the Kansas Racing Commission to supervise parimutuel betting, which in 1996 was renamed the Kansas Racing and Gaming Commission. L.1987, ch. 112, sec. 3; L.1996, ch. 256, sec. 18. In 1990, the Kansas Legislature extended the life of the state-owned lottery. L.1990, ch. 370. The lottery is now scheduled to expire on July 1, 2022. K.S.A.2007 Supp. 74-8723(a).

Two earlier cases before this court have addressed the interplay between the constitutional ban on lotteries and the subsequent amendments permitting limited lotteries: State ex rel. Stephan v. Finney, 254 Kan. 632, 867 P.2d 1034 (1994) (definition of lottery includes gambling enterprises in general); and State ex rel. Stephan v. Parrish, 256 Kan. 746, 887 P.2d 127 (1994) ("instant bingo" exceeds constitutional boundaries for legal bingo games). No constitutional challenges under the constitutional lottery provisions have come to this court since Parrish was decided in 1994, and this court has never been asked to address the constitutionality of the 1987 Kansas Lottery Act.

During the 2007 legislative session, the Kansas Legislature passed, and the Governor signed, SB 66, "An act concerning lotteries; enacting the Kansas expanded lottery act, authorizing operation of certain gaming facilities, electronic gaming machines and other lottery games at certain locations. ..." KELA became effective April 19, 2007. L.2007, ch. 110. It is codified at K.S.A.2007 Supp. 74-8733 et seq. It generally provides for gaming in casinos and parimutuel racetracks in four gaming zones. K.S.A.2007 Supp. 74-8734(d); K.S.A.2007 Supp. 74-8737; K.S.A.2007 Supp. 74-8741(a). The four zones are the northeast Kansas gaming zone, consisting of Wyandotte County; the southeast zone, consisting of Crawford and Cherokee Counties; the south-central zone, consisting of Sedgwick and Sumner Counties; and the southwest zone, consisting of Ford County. K.S.A.2007 Supp. 74-8702(f).

On August 23, 2007, the attorney general filed an original action in quo warranto and mandamus with this court under case number 99,128. K.S.A.2007 Supp. 74-8733(c) expressly provides that "[a]ny action challenging the constitutionality of ... this act ... shall be brought in the district court of Shawnee county," and we therefore transferred the case to the Shawnee County District Court. The district court filed a 41-page memorandum decision and order on February 1, 2008, holding that the statute passed constitutional muster. The State of Kansas, through the attorney general, filed a timely notice of appeal and amended notice of appeal.

The attorney general is the proper party to pursue this action. See K.S.A.2007 Supp. 75-702; Rowlands v. State, 187 Kan. 174, Syl., 354 P.2d 674 (1960) (action questioning authority of governmental agencies should be brought in name of the state on the relation of the attorney general or county attorney); see also State ex rel. Stephan v. Parrish, 257 Kan. 294, 891 P.2d 445 (1995) (mandamus is proper remedy to obtain authoritative interpretation of law for guidance of public officials); Parrish, 256 Kan. 746, 887 P.2d 127 (attorney general challenged constitutionality of instant bingo statute); Finney, 254 Kan. 632, 867 P.2d 1034 (attorney general brought action to determine Governor's authority to negotiate tribal casino compacts; action brought pursuant to Senate resolution).

We will not address arguments raised or advanced solely by nonparty amici curiae. These include policy concerns regarding the wisdom of raising revenues by means of a lottery and arguments about the validity of an election authorizing a gaming facility in Sumner County. A party must file a notice of appeal or cross-appeal in order to raise an issue for appellate review, see Mid-Continent Specialists, Inc. v. Capital Homes, 279 Kan. 178, 191-92, 106 P.3d 483 (2005), and the amici do not have standing to file appeals. We will not consider issues argued by nonparties when those issues are beyond the ones raised by the parties. See Jones v. Bordman, 243 Kan. 444, 450-51, 759 P.2d 953 (1988).

Standard of Review

The constitutionality of a statute is a question of law, and this court applies a de novo standard of review to the judgment of the district court. Tolen v. State, 285 Kan. 672, 673, 176 P.3d 170 (2008).

In State ex rel. Morrison v. Sebelius, 285 Kan. 875, 883-84, 179 P.3d 366 (2008), we stated the appropriate standard for reviewing the constitutionality of a statute:

"[T]he separation of powers doctrine requires a court to presume a statute to be constitutional. [Citation omitted.] `A statute is presumed constitutional and all doubts must be resolved in favor of its validity. If there is any reasonable way to construe a statute as constitutionally valid, the court must do so.' [Citation omitted.]"

It is not the duty of this court to criticize the legislature or to...

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