State v. The Kansas Mercantile Association

• Decision Date: 07 February 1891
• Citation: 45 Kan. 351,25 P. 984
• Parties: THE STATE OF KANSAS, on the relation of L. B. Kellogg, Attorney General, v. THE KANSAS MERCANTILE ASSOCIATION et al
• Court: Kansas Supreme Court

25 P. 984

45 Kan. 351

THE STATE OF KANSAS, on the relation of L. B. Kellogg, Attorney General, v. THE KANSAS MERCANTILE ASSOCIATION et al

Supreme Court of Kansas

February 7, 1891

January 1891, Decided

Original Proceeding in Quo Warranto.

THE opinion, filed on February 7, 1891, states the case.

Judgment entered.

L. B Kellogg, attorney general, for The State.

S. B. Bradford, for defendants.

HORTON C. J. All the Justices concurring.

OPINION

HORTON, C. J.:

This action is brought under subdivisions 3 and 4 of P 4767 of the General Statutes of 1889. It has for its object the forfeiture of the charter of the Kansas Mercantile Association, and the prevention of the individual defendants from acting as a corporation or exercising corporate rights. The charter states that the purpose for which the corporation was formed is to sell various articles of merchandise with premium numbers attached, the premium numbers entitling purchasers holding the same to a selection of other articles. The testimony of P. W. Kline, the general manager of the association, shows that the object in obtaining the charter was to enable the association to carry on the identical business which the evidence discloses is carried on by the association. The testimony of witnesses shows that the association has on hand a number of lead pencils, probably of the value of a small fraction of a cent; that a five cent investment or a dollar investment, in the purchase of one of the "vendor's certificates," as the defendants are pleased to call their tickets, entitles the purchaser to one of these lead pencils; that the purchaser of a certificate or ticket selects certain numbers, say 3-9-13, and hands these numbers into the office of the association, and if all the same numbers come out in the next drawing, the purchaser gets a prize, ranging from forty-five cents to $ 2,500; if the numbers selected do not come out, the purchaser gets no prize; that twice a day seventy-eight numbers are placed into a wheel on the stage of Hanson's opera house, at Kansas City, in this state; that the wheel is revolved for half an hour; that a blindfolded boy draws out twelve numbers at a noon drawing and thirteen numbers at an evening drawing; that such persons as choose to be present at these drawings attend and make up the audience; that the numbers drawn are posted on a blackboard, and are sent to the various agencies in Atchison, Wichita, Leavenworth, St. Joseph, Mo., and two or three points in Texas, where the association has agencies established for the purpose of assisting in carrying on its business. The business of the association is called and generally known as "playing policy."

Section 3, article 15, of the constitution of the state, ordains that "lotteries and the sale of lottery tickets are forever prohibited." Of course, there is no provision in the statute concerning private corporations authorizing the formation of any corporation or association in this state to carry on lotteries or to sell lottery tickets.

Paragraph 4767, General Statutes of 1889, reads:

"Such action [in the nature of quo warranto] may be brought in the supreme court or in the district court, in the following cases: . . .

"Third: When any association or number of persons shall act within the state as a corporation without being legally incorporated.

"Fourth: When any corporation does or admits acts which amount to a surrender or forfeiture of their rights and privileges as a corporation, or when any corporation abuses its power or exercises powers not conferred by law."

Upon the pleadings and evidence, the sole question is, whether the business carried on by the Kansas Mercantile Association is a lottery. The word "lottery" must be construed in the popular sense, with a view of remedying the mischief intended to be prevented, and to suppress all evasions for the continuance of the mischief.

A "gift sale" of books is a lottery. (The State v. Clarke, 33 N.H. 329.)

A "prize-candy" business is a lottery. (Hull v. Ruggles, 56 N.Y. 424; Holoman v. The State, 2 Tex. Ct. App. 610.)

"Prize concerts" are lotteries. (Commonwealth v. Thacher, 97 Mass. 583; The State v. Overton, 16 Nev. 136; Negley v. Devlin, 12 Abb. Pr. 210.)

"Prize tickets" to induce subscriptions to a newspaper, constitute a lottery. (The State v. Mumford, 73 Mo. 647.)

"Raffles" at fairs are lotteries. (Commonwealth v. Manderfield, 8 Phila. 457.)

"Drawing works of arts" constitutes a lottery. (Governors of Almshouse v. American Art Union, 7 N.Y. 228.)

"A public exhibition during which, and as a part of the advertised proceedings, presents were distributed among such of the audience as held tickets which answered to the numbers called at will by the exhibitor, held to be a lottery." (The State v. Shorts, 32 N.J.L. 398.)

"When a city or a government, in order to make an inducement for people to buy their bonds, holds out large...