Affiliated Enterprises, Inc. v. Waller

5 A.2d 257, 40 Del. 28, 1 Terry 28, 1939 Del. LEXIS 25
CourtSuperior Court of Delaware
DecidedMarch 14, 1939
DocketNo. 36
StatusPublished
Cited by41 cases

This text of 5 A.2d 257 (Affiliated Enterprises, Inc. v. Waller) is published on Counsel Stack Legal Research, covering Superior Court of Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Affiliated Enterprises, Inc. v. Waller, 5 A.2d 257, 40 Del. 28, 1 Terry 28, 1939 Del. LEXIS 25 (Del. Ct. App. 1939).

Opinion

Layton, C. J.,

delivering the opinion of the Court:

It is accepted as a legal truth that the law will not lend its aid to a claim founded on its own violation. If, then, the plan or scheme, which is the substance of the contract declared on, is in violation of the statute, the plaintiff will unavailingly seek the protection of the Court.

There was a time when lotteries were entirely legal in this State, so much so that it was held that lottery tickets sold were properly chargeable in a book account. Gregory & Co. v. Bailey’s Adm’r, 4 Harr. 256. A changed public opinion resulted in the constitutional provision and the enactment of the statute to effectuate the prohibition of the organic law.

The defendant denies liability on the ground that the contract entered into is offensive to the public policy of this State, in that it embraces a plan or scheme essentially [33]*33a lottery in its nature. The plaintiff denies that the scheme is a lottery, for the reason that there is lacking the material element of consideration as that term is, or ought to be, properly understood with respect to lotteries. This is the crucial point of the case.

It is best, perhaps, not to define the word “lottery” too precisely, for the reason that human ingenuity is too frequently successful in evolving a scheme entirely within the mischief, but not quite within the letter of the definition. People v. McPhee, 139 Mich. 687, 103 N. W. 174, 69 L. R. A. 505, 5 Ann. Cas. 835. In this State the word has been judicially defined as “a scheme for the distribution of money or prizes by chance.” State v. Sedgwick, 2 Boyce 453, 81 A. 472, 473; State v. Gilbert, 6 Boyce 374, 100 A. 410. This is the English definition. Taylor v. Smelton, 112 B. C. 207. It seemingly ignores consideration as an element; but, undoubtedly, that element is implied; and it is agreed that a lottery has three essentials, prize, chance and consideration. An acceptable definition is one offered by the Missouri Courts where a lottery is defined as any scheme ■ or device whereby anything of value is, for a consideration, allotted by chance. State v. Emerson, 318 Mo. 633, 1 S. W. 2d 109.

The statute in this state does not attempt formally to define the term. It amounts to a broad and comprehensive denunciation of those persons concerned in interest in selling or disposing of any number, ticket or anything by which such persons promise or guarantee that any particular number shall on the happening of any contingency in the nature of a lottery, entitle the purchaser, or holder, thereof to receive money or property.

The language of the statute is important in determining the quality of the consideration as related to a lottery.

The plaintiff admits that the elements of prize and [34]*34chance are inherent in the plan; but it contends first, that the requirements of registration and attendance in the lobby of the theatre or outside at a fixed hour are but conditions for a gratitous promise, and not a consideration of the promise; and second, that peculiarly within lottery agreements, consideration, in the sense of something of value, or price, must be paid for the right to participate, a mere formal and technical consideration, while sufficient to support a contract in the ordinary sense, being insufficient to constitute value or price in the lottery sense.

It has never been denied in this State, broadly, that consideration consists in either a benefit to the promisor or a detriment to the promisee. Szymanska v. Equitable Life Ins. Co., 7 W. W. Harr. (37 Del.) 272, 183 A. 309; and the Court is called upon here to determine first whether, generally, in a lottery sense, consideration is restricted to something of value, or price, for the privilege of participation in the scheme; and, second, whether the statute was designed to permit the use of the word in such restricted sense.

Every agreement springs from an offer and acceptance. A general offer made to the public may be accepted by anyone within the terms of the offer; and any lottery scheme or plan resolves itself into offers and acceptances. A lottery is nothing more or less than a number of offers and acceptances upon considerations.

Whether an act, or other detriment, is but a condition precedent to performance of the promise, or whether it has the quality of consideration, depends on how it was dealt with by the parties as viewed from the standpoint of a reasonable man of average intelligence and discernment. Holmes Common Law, 292, 293; Street, Foundations of Legal Liability, Vol. 2, 70.

Professor Williston in his authoritative work on con[35]*35tracts, Vol. 1 (Rev. Ed.), Sec. 112, makes this clear. The writer says: “The same thing, therefore, stated as the condition of a promise may or may not be consideration, according as a reasonable man would or would not understand that the performance of the condition was requested as the price or exchange for the promise. If a benevolent man says to a tramp, — ‘if you go around the corner to the clothing shop there, you may purchase an overcoat on my credit’, no reasonable person would understand that the short walk was requested as the consideration for the promise, but that in the event of the tramp going to the shop the promisor would make him a gift. Yet the walk to the shop is in its nature capable of being consideration, and the only reason why the walk is not consideration is because on a reasonable interpretation, it must be held that the walk was not requested as the price of the promise, but was merely a condition of a gratuitous promise. It is often difficult to determine whether words of condition in a promise indicate a request for consideration or state a mere condition in a gratuitous promise. An aid, though not a conclusive test in determining which interpretation of the promise is more reasonable is an inquiry whether the happening of the condition will be a benefit to the promisor. If so, it is a fair inference that the happening was requested as a consideration.” See Allegheny College v. National Chautauqua County Bank, 246 N. Y. 369, 159 N. E. 173, 57 A. L. R. 980.

Strictly speaking, the adequacy of a consideration is not a question for judicial determination at all. That is a thing for the parties to settle. Upon this point of legal theory the law has never wavered. 2 Street, supra, 69, “If a person chooses to make an extravagant promise for an inadequate consideration, it is his own affair.” Holdsworth, Hist. Eng. Law, 17; Sturlyn v. Albany, Cro. Eliz. 67. It is well settled that a detriment suffered by the promisee at the promisor’s request and as the price for the promise is [36]*36sufficient, though the promisor is not benefited. 1 Williston, swpra, Sec. 102. A mere expectation or hope of benefit is sufficient. Collins v. Hutchins, 2 Penn. 496, 47 A. 1004; Garrow v. Davis, 15 How. 272, 14 L. Ed. 692; 13 C. J. 318.

In cases such as the one under consideration the natural question is, were the requirements of registration and attendance in the lobby or outside the theatre at a particular time mere incidental or friendly detriments, not intended as ingredients of a bargain, or were they a bargained for consideration? 1 Williston, supra, § 101.

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Bluebook (online)
5 A.2d 257, 40 Del. 28, 1 Terry 28, 1939 Del. LEXIS 25, Counsel Stack Legal Research, https://law.counselstack.com/opinion/affiliated-enterprises-inc-v-waller-delsuperct-1939.