Phalen & Morris vs. The State of Maryland.—1841. the drawing of the lottery by them offered and proposed to be drawn in the city of Baltimore, on the I8th day of February, 1840, and purporting to be so offered and proposed by authority of acts of the General Assembly, for the benefit of Washington and St. John's Colleges, till their right to draw the same can be determined; and also the State's writ of subpœna, &c. Upon this bill the county court ordered an injunction to issue. The joint and separate answer of James Phalen and Francis Morris alleged, that it is true as stated in said bill of complaint, that by the various acts of Assembly in said bill mentioned, certain lotteries were authorised to be drawn, in order to raise funds for Washington and St. John's Colleges, and by said acts the governments of said colleges were authorised, either to draw said lotteries or to sell the right of drawing the same to any other person or persons whomsoever. And these respondents further admit, that the right of raising the sums of money in said acts mentioned, was duly and regularly assigned, for value received, to Palmer Canfield, of the city of New York. And these respondents further answering, admit, that said Canfield submitted for approval to the Governor and Chancellor of the State, the system of schemes of lotteries, amounting to a large sum nominally, and these respondents admit that ten of said schemes, amounting in the gross to the sum of six hundred eighty-seven thousand three hundred and sixty-five dollars, were drawn by said Canfield or his agents, but these respondents deny that any other schemes were drawn by said Canfield, and they also deny that tickets to any extent, in any other schemes, were sold by him or his agents; and they also deny that any of such tickets of the few which were sold, remains outstanding, unless they be in the hands of dealers who never paid for them, Canfield having redeemed all which were paid for. And these respondents further answering, admit, that the prizes in each of the schemes submitted by, and approved for said Canfield, and by him advertised, amounted to the sum which would have been raised by the sale of the whole of the tickets in such scheme, and that cach and every ticket Phalen & Morris vs. The State of Maryland.-1841. issued in each and every scheme, contained upon its face a stipulation, that the holder should submit to a deduction of fifteen per cent. from such prize as it might draw; but these respondents expressly deny, that either one hundred and sixty thousand dollars, or any other sum exceeding thirty thousand dollars, was raised, either by said Canfield or by any person drawing lotteries under the aforesaid grants, so assigned as aforesaid to said Canfield, including the drawing of Yates and McIntyre and Francis W. Dana; but these respondents verily believe, that said Canfield made large losses by such drawings, never having sold one-third of the tickets in said schemes, and several very high prizes having been drawn by holders of said tickets sold as aforesaid; and in confirmation of this denial, these respondents state, that from the 1st of December, 1838, to the 1st of December 1839, schemes were issued by the Commissioners of Lotteries for this State, amounting to about five millions of dollars, from which they derived but about twenty thousand dollars; and further, that said commissioners require of the contractors for such schemes, merely an allowance of five per cent. upon the tickets sold, and not upon the gross amount of the schemes. And these respondents utterly deny, that the lottery privileges by said act granted, have been exhausted or extinguished. And these respondents further answering, admit, that under such grants Yates & McIntyre drew several schemes, amounting in the gross to three hundred eighty-three thousand seven hundred and forty-five dollars, for which said Yates & McIntyre paid said Canfield eight thousand dollars, and no more; and they also admit, that Dana did draw one scheme, and no more, and that the gross profits were three hundred forty-eight dollars and seventy-five cents, and no more. Whether such last drawing took place on the approval of the Commissioners of Lotteries, these respondents do not know, and cannot therefore admit or deny. And these respondents admit, that no other security, except that given by Canfield and Yates & McIntyre, has been given, but aver that these respondents are ready and willing to file any bond with such satisfactory security as may be required by the pro Phalen & Morris vs. The State of Maryland.-1841. per authorities. And these respondents further answering, admit the recovery of the judgment of the said State in the manner and at the time stated in said bill of complaint, and that said Palmer having been ruined by the loss upon the drawing of said lotteries, and other causes, died at or about the time stated, insolvent, not having satisfied said judgment; and they further admit, that letters of administration upon the estate of said Canfield, have been granted in Maryland to Robert B. A. Tate, the clerk of the Commissioners of Lotteries, who your respondents verily believe obtained said letters under the direction, and at the instance of said commissioners or their counsel; and they also admit the pendency of said actions of debt against said Tate, as is alleged in said bill. And these respondents further admit, that they did propose and offer to draw the scheme of a lottery on the 18th day of February, now last past, but they deny that they falsely alleged themselves entitled to do so by virtue of any pretended assignments, but on the contrary aver, that they are bona fide assignees for valuable consideration of the grants to said colleges, and they herewith state the dates and times of such assignments, which they are ready to produce and prove, when and where this court shall require. Palmer Canfield, on the 29th day of July, 1829, assigned to Felix Pascales the said grants, in trust to sell the same, and from the proceeds thereof to pay a debt due to said Pascales, and another one to James Raymond, with interest on such debts; that said Felix died, having first made his last will and testament, bequeathing all his estate to his son, Cyril O. Pascales, and also appointing him executor of such will; that said Cyril advertised and sold such grants at auction, to Alexander G. Anderson, and on the 19th day of February, 1834, assigned and conveyed the said grants to said Anderson; that on the 22nd day of February, 1834, the said Anderson conveyed the same to James Raymond, of the city of Baltimore, and on the 13th day of December, 1838, the said Raymond, for full value, assigned and transferred the same to these respondents, and these respondents verily believe, that all of said assignments were fairly made, and for a Phalen & Morris vs. The State of Maryland.--1841. valuable consideration. And these respondents further answering, admit, that the schemes by them proposed to be drawn, were not submitted for approval, or approved by the Commissioners of Lotteries, these respondents submitting that they were not by law bound to submit the same for approval to such commissioners, and these respondents well knowing that no scheme submitted by them would be approved. And these respondents further answering, deny, that the assignment made by said Canfield to Felix Pascales was fraudulent, or without consideration, or fraudulently or otherwise to defeat and delay the aforesaid judgment rendered against said Canfield, or any other judgment. And these respondents insist, that said Canfield had the power of transferring the said lottery grants, and that these respondents are the assignees of such lottery grants; and these respondents admit, that said Felix Pascales is dead, and that no letters testamentary, or of administration, upon his estate have been granted in Maryland. And these respondents pray to be hence dismissed with costs. After this, the cause was prepared for a final decree by admissions of facts and the filing of documentary proof, all of which, so far as is necessary to the understanding of the opinion. and application of the principles decided in this court, sufficiently appear in the opinion delivered in this cause. At the final hearing, Baltimore county court (PURVIANCE, A. J.,) decreed that the defendants be, and are perpetually enjoined and restrained from proposing or offering to draw, or disposing of any scheme or schemes of lotteries under or by virtue of the acts of Assembly in the bill in this cause mentioned. From this decree the defendants appealed. The cause was argued before BUCHANAN, C. J., STEPHEN, ARCHER, DORSEY, CHAMBERS, and SPENCE, J. By G. R. RICHARDSON and R. JOHNSON for the appellants. By J. MASON CAMPBELL and MCMAHON for the appellees. DORSEY, J., delivered the opinion of this court. Phalen & Morris vs. The State of Maryland.-1841. It is admitted, that if all the tickets had been sold in the schemes, which have been drawn under the lottery grants in favor of Washington and St. John's Colleges, that a larger amount would have been raised than was authorised by the acts of Assembly under which the drawings took place. But it is insisted on the part of the appellants, that notwithstanding the competency of the schemes drawn (had all the tickets been sold,) to have raised the sum of $160,000, as authorised by the Legislature of Maryland, yet, that but a small portion of that sum was, in point of fact, realized, by reason of a great portion of the tickets remaining unsold when the schemes were drawn, and by the loss of the wheel, in the high prizes coming up to the tickets which had been sold. The first question, then, raised for our determination, is, have the lottery grants in question been exhausted by the drawing of lotteries, competent, upon the face of the schemes, to have realized the prescribed amount, or, as contended for by the appellants, are the owners of the privilege at liberty thereafter to continue their drawings, until, by the gain of the wheel or the sale of tickets, the specified amount shall have been actually raised? But the act of 1816, chap. 89, and by the supplement thereto of 1823, chap. 193, the Visitors and Governors of Washington College are authorised to propose a scheme or schemes of a lottery or lotteries, for raising a sum of money, not exceeding eighty thousand dollars; and by the act of 1821, chap. 46, the Visitors and Governors of St. John's College are authorised "to propose a scheme or schemes of a lottery or lotteries, for raising a sum of money not exceeding eighty thousand dollars." The assignees of the franchise possess no greater powers than did the visitors and governors of these colleges. The terms in which the authority is communicated to them, are clear and unambiguous, to wit, to propose a scheme or schemes for raising a limited amount; when the schemes for raising that amount have been proposed and drawn, the authority given has performed its office, according to the letter of the acts of Assembly by which it is conferred. And if we |