                  T~EA~OWNEYGENERAL
                            OFTEXAS

PRICE DANIEL
ATTORNEYGENERAL

                         19ovember 30, 1948

     Hon. Homer Oarrison, Jr., Director
     Department of Public Safety
     Camp Mabry
     Aus tin, Texas           Opinion No. V-727.
                                R4:   jhether plan to make up
                                       purse” for midget auto
                                      races from entrance tees
                                      of drivers and psrtlclpe-
                                      tion by drlverls friends
                                      and fans Is illegal.
     Dear Cal. ffarrlsonz
               Your letter of September 24, 1948, outlines
     a plan to conduct midget auto recea, and to award and
     distribute purses to those~postlng and contributgga;E-
     ward the entrance fees of drivers in the race.
     asked whether the plan is contrary to the penal laws of
     the State.
                The proponents are constructing a stadium to
     seat approximately 12,000 peraonr, and desire to attraot
     outstanding driver8 by the offer of a large “purse” or
      rize for winning drivers. They propose to charge a
     8500.00 entrance fee of each driver, which will go into
     the exhibitors1 fund for the sole purpose of increasing
     the “regular” purse, which repreaisntn4056 of the gate
     receipts . Drivers will be permitted to “sell” a por-
     tion of the entry fee to “friends” and “fans” in cases
     where a driver does not have sufficient funds to poet
     the full fee, or for other reason does not desire to
     do no.  Those buying interests, or so contributlng,wlll
     partlcQate In proportion to their,lnterest in the added
     purse, if their man places first or second. They will
     not participate in the “regular”   purse, made up of a per-
     centage of the gate receipts. The proponents will aet
     up “drivers’ quarters” for the convenience of the friends
     of the drivers  who wish to purchase a portion of the fee
     not purchased by the driver.    The driver, or his agent,
     will collect the winnings and disburse them to the lnter-
     ested parties C If the driver posts the full fee, there
     will be no further distribution of his winnings.
                                                                                 .       _
                                                                                     -




Hon. Homer Osrrieon,                 Jr.,     Page 2,     V-727.



          Article              6521~‘       Vernonte    Penal   Code,    provider,
la part, a8 followsl

               “section         1.      Any perron       who takes      or
           OP pl6080 for raothor a brt OF wages
     rocrptr
     Of8o noorjlnt’thk6 Of value on 1. home
     race,      dog mar,             automobile        risoo,motorojcle
     race or an other raoe of any kind whatro-
     ever, foot c rll gme, brrrbrll games fith1etl.o
     contmt  or rport8                  went      of whatroevor      kind
     or obarrotrsj or  an prraon who offem to
     t&r or roorpt or pI loo for mother any ruoh,
     bat OF wrqorj o r lnv prrron who l8 (Ln agent,
     8ervmt  or em 10900 or othrrwl88,  aid8 or one
     ooura~er mot & r to t&o or roorpt or plroe
     any ruoh bet or WI erj                     or an) prrron      who di-
     rrotly    or indlrrot f y suthorlcw,                    side or rn-
     ooumger my a&ant, rrrvrnt or                          employer or
     othrr   prrron  to t&r or rooopt                      or lror or
     trmrait      an euoh brt or wrgrr                     rha P 1 br guilty
     of book mrlc 3ng.   I I

            “S4CE  4,  Any owner, agmt,   lraror or
     lr64aer of my real or prrronrl     proprrty who
     rhrll   knowlnglf  u80 or knowi  19 pormLt ruoh
     property to br urrd in oonneoY ion with book
     making, a8 ruoh term 18 herrin doflnod, rhall
     be uilty of l frlony and upon oonviotlon
     rh8f 1 be puaLlwd    41 ret fssth under 88otlen
     1 of thir ht.

               “B.C.      It shall
                          5.             br unlbwful for l;l
     prrron or thr agent,           rrrvmt    or aplofrr       of
     an7 permn,       oorporation        or ~88ooirtlon     of
     por8on8,     knowlngl~       to furnlrh    trlrphoae,     tale-
     graph, trlrt$po,         tile    rint or radio arr*loo
     or rqulpsmtj or to p PMI the rrma on my
     pro rrt? la thL# 8tatr uard for the ur 010
     proii lbltrd    b;l thtr Aot or to rr8i8t          1 a ? ho
     violation     of my of the provirlonr             of thlr
     Aot by fumi~hln            of ~9 trlrphoar,trlr~ruph,
     trlrtrpo, trlr r nt or radio rrrvioo or rquip-
     mnt. It rhal Pf rlno be unlawful for ant                     r-
     8on or rrmoalrtlon of prr8onr              ‘or oorporat r 081
     knowlnglj to pwmlt l9 trlrphonr,                  telwr4gL,
     tielrtjpr,    trlrprlat,       radio or other maam of
     oamunio~tlon        whatrvor       to cmrin     on ra9 prop-
     rrty u8rd for the purpoar prohibltmd                 br thlr
     Aot. a a”
’   .




        Hon. Homer Qarrlson, Jr., Page 3,   V-727.


                  Article 652a makes “book making" on automobile
        race8 a felony. Betting and wagering, thereon, are not
        there prohibited, but acting for someone else, aiding
        sotn4on4else, 8nCOuraging 8om4on4 41S4s in making such
        bet or wager on a race, and offerlng to take, accept or
        place 8uCh a bet for another are ptiohlbited. Knowingly
        permitting the use of property in connection with OUCh
        activities ia also prohibited. Und8r this Article, no
        one may act as any sort of intermediary, or em9109 lnter-
        mediaries, or Oth4rWi.84facilitate, aid or encourage
        others Wmaklng   Ouch bet8 or wagers, nor may ho offer
        to take such a bet or wager for another.
                  The test of lllegalitg under this Article, re-
        gardl888 of what 1s actually lntendsd under the plan, is
        whether betting and wagering by anyone will in fact be
        facilitated, aided, or encouraged by some or all of thO88
        engaging in or furnishing facilities and services to the
        enterprise. Obviously, no hypothetical outline of such
        an enterprise can state or even antlCipat8 all of these
        things, and we must'necesaarily decline to venture an
        oplnl.onthat .the law will not or cannot be violated there-
        under. We will not do so. The t4nd4nCi48 are quite ap-
        parent, and ViOl&tiOtl# Of ths blf ar4 pO88iblO .Stld
                                                            Won
        probable.
                  We have found no statute prohlblting betting
        as such upon automobile races.  It is "book making"
        which is prohibited. Before the offense of book making
        c&n be committed, however, there must be a bet or wager
        Involved, or at least the tender or offer of a bet or
        wager.
                   There 18 no question but that where two or more
        contestants contMbute sums of money making up a fund
        which is to belong to the winner of the contest, the agree-
        ment or transaction h a bet or wager. Equally certain
        it is that for two or more persons to conteat for a prite
        offered by one not a contestant, the agreement or trans-
        action  18 not a wager. 27 C. J. 1051. The queatlon here
        18: Uhere both the contestants and the exhibitor contrl-
        but8 auma of money toward prizes, is the transaction a
        bet or wager as to either the contestants or the exhibitor?
        On the face of the statement, It would appear that the
        money contributed by the contestants would constitute a
        stake or wager, while that contributed by non-contertants
        is a mere prize.
                                                           .,
HOG. Homer Garrison, Jr.,   Page 4,   V-727.



           But, the 8OlUti4~  18 llOt 88 8i.lll91.  @.I &ll tbt.
If the ContPibUtiOn   by th4 ~~t48tMlt8    do.8 not 80 %8-
mediately md blmctlj to the purse or prlee, it may not
in fact be a bet or wagor. For example,         where a racing
association offer8 a prim to the winner but charger,an
entrance fee for the right to participate, the entrance
fee going into the funds of the association from which
the expenses of aalntalnlng &he track and quarters are
paid in addition to the making up of a prize, there is
missing the necessary   identity of the entrance fee a8 a
part of the purse or prize; and, without more, it cannot
be said that the entry fee Is not In fact charged to off-
set the expense of such maintenance and is not paid aalo-
ly for the prlvllege of entering the contest. This ap-
pear@ to have been the basls for the decisions in a number
of cases that the mere fact that entrance fees are paid
by contestants, which fees go into vr lnorease the purse
or prlee offered by the exhlbltorr,of the race, does not
make an entry fee a bet or wagers OT the purse or prize
a stake. As we aee it, all of the facts and circumstances
surrounding the particular transaction are necessary to
determine the character of the transaction as being a bet
or wager. It cannot be said, en the other hand, that be-
cause of the ruer4 fact that the contestant's contribution
is called an "entrance fee", the transaction is not 3x1
fact a bet or wager. The cases aloe bear this out, acme
by express lamguage and others by necessary implicatlen.
                In Toclaeyv. Penwell, 76 Mont. 166, 245 Rc.
943# 45 A.L.R. 993, a leading case on the subject, the
Court denied recovery fronta Stat4 Fair A#@OCiBtiOn,
under a statute authorielng recovery of losa4a in 8 wager,
of the sum of $2.99 prld by a centertant for the right to
eater a horse in a raae for a.purae of $3750OO, on the the-
cry that the fee was not shown to be a bet or wager under
a statute prohibiting betting on contest8 of the like. The
purses were definite U4Ud4         9h8   UOUIItO   "4qUd to” the
entrance      fee8 paid la eaah race. The Court quwtw 27 C .J.
 1051 to the effect that where the entrance fee deer not
a eciflcoll make up the purse, the 84~4 fact that the
jiikn-3     8 u   4 up prrtly of fee8 and inpartot      an added
#\p     dws   not  make the oontwt  a wager.     The CeuHi said:
           “The reason fer the rule is apparent.
     Uhen plolntlff p8ld the entrance Pee, he re-
     ceived the adequate consideration for It -
     the privilege of having the horse ‘Florence
     Fryer' participate In the race.   He parted
     with the title to the money and the $2 at
Hon. Homer Gbrrhon,           Jr.,          Page 5,        V-727.


      oace     beoame the   property of the Fair
      Amoclatlon,        and & part of It8 gmrral
      fuadr,  vhich      It aould UIO to tis'i)rem-
      Ium Ih whole       or
      dlaary  WD
      JRlrDO8@, ‘*         purl8            ruppllrd)

Th@t the partioulrr       faot8 of my given 0180 could ohagr
th8 r88Ult      18 illU8tZWtrd   by the langlug Iam8dIatrly
follovIng      the abovr quotrtionl

             “But th88e Ob8WV&tiOn8 a d thr au-
      thO!'ith@r  oitod hvr to do VI-.
      tl’~n8~OtiOU8,   ld not vIth @mblIrq 80
      ;~I~l~o~i8~Ui80d    l8 to l PO&P t0 br Vh4t
                                                  ortrd upon tha
       theory t&t                lad latzuaor for la
      (LR rmouat of aowj     rotwlly    paid uadoadl-
      tIoar;lly   rnd Ia good faith   foa thr p~,Lvl-
      lo o of ratrslag Dlu oontelt,       8ad for, ao
      ot %or purporr1    If r& fact thr fro karnot
      paid toss ruoh pu~poal;                         I

                                   mg        orn 8bVO
      rotion     ta~m tha opd, martion                  of   ow     mtl-
      6mbling        8 tatUt0 a         t   fEm@i@ei~8 rupplird)

            AUthoPltIO8    referrod                t0 ln bddltion to OOrpu8
Jurlr &WI     Woarlron v, bnnott                    (Moat,),        40 L,R,A, 158,
ooataIaIag   dlotum to thr elirot                   that
                                               Offaring   psIbo8 oa
hor8, rao.8   18 not   OOntrrX’y     to
                                      bubllo    polioy   Vh.F@ the
pUX’8r 18 ofSered    in good faith    and not l8 l 8UbtWf             l
iOr b8ttIag   and g&mIagl       PortervI ho,     71 W*l.   296,%
11, W. 259, woo nlclng       that uhrro the prI88 I8 A marr
8UbtWlUg8      f0~ %8ttIPg rnd gaming It I8 prOhIbIt8dl              atr-
bi8 v, White, 81 NJ, Y, 532, rroogeIcIng           th a tl mtrrnor
Se0 would bo a brt If It wont        “Imraodirt8l~”     to marti up
thr purr.     0ontrrt.d fOT, inrtO&d    Of #Oin(l into the garb
-1    flUId Of th8 ~88OOirtiOllj and bllkbn8           Vt OttitlgOr,
115 Qrl, 454, 47 P, 254, 40 L,R,A,          76, whrro the ontrraor
?ro W8 admittedly not grid l8 l W4ger 02’brt, but for
the prlvllrge     of ontoring   the rIQee
           On thr other    hand, In OIbbOa8 v, OOUVODIUF, 1
 D8nIo 170, Wh8P8 tho noary paid by the ooatO8~at8       Va8
 for the OX)U?@88 pUPpO80 Of making & I-k8 t0 bo OOat@8t-
 ad for, and for no other    purpo8e,  and with the prrvIou8
 rgrwmrnt  that the vrry wm8 thU8 paid 8hOUld form tho
 Itake, ld to go, the whole oi' lt,     to the Winner of thr
raO0, OOIl8titUted b8ttIng    rnd Vagrrlng.
                 .
-.   .



         ,-




         Non. Homer Garrison, Jr., Page 6,   V-727.


                   In Stoddard v. &Aullffe, 81 Hun. 524, 31 N.Y,S.
         38, affirmed by memorandum, 151 N. Y. 671, 46 H. E. 1151,
         a club put up a prize of #,OOO.OO, and two prize fighters
         put up an additional $1,500.00 each, all to go to the,vim-
         nor. This wan held to be a bet or wager within the etat-
         tltte
            .
                    In Porter v. Day, supra, the Court said:
                    “If two or more men owning trotting
               horses should contribute equally or other-
               vise a sum of money, and put it into the
               hands of some other person for the puruose
               of offering it as a premium or reward to
               themonlr. and to the owner of the horse
               who should win the race, such a transaction
               would undoubtedly coiuewithin the rule whlci
                rohlblts betting on a horse or other race.
               PEmphas la supplied)
                    In Dudlep v. Flushing Jockey Club, 14 Misc. 58,
          35 I.Y.S. 245, a 8tatut.eauthorlzlng’partlclpants in a
          horse race to join In furnishing the stake or purse was
          held to be an attempt to legalize the wager in contraven-
          tion of a constitutional provision against pool selling,
          book making and gasbllng.
                   In the plan before us, the entry fee Is for the
         oxpress purpose of making a “purse’ to be contested forP
         and for no other purpose, and with the previous agreement
         that the very auas thus paid should form an added purse,
         to go, the whole of it, to the winning drivers. It con-
         stitutes a bet or wager.
                    There la no distinction in principle between the
          plan and the playing of pool, the winner to pay the fees
          charged for use of the table, condemned as betting in Mayo
          v. State (Tax. Crlm.), 82 3. 1J.515.
                    The participation of “friends” and “fans” Is to
          be tested b  like principles. In Cbulter v. State, 53
          3. W. (2d) (77, where options were sold and redeemed on
          horses entered in races, the Court of Criminal Appeals
          held, in effect, that where the mutual understanding of
          the parties to the transaction vas that, dependent upon
          the result of the horse race, the money Invested in the
          options would be lost or increased, the transaction COW
          stituted betting on a horse race. The Court cites 9tato
          v. Falls Cities Amusement Co., 124 Ohio St. 518, 179 B.R.
Hon.   Homer   Garrison, Jr., Page 7,   v-72-f.


405> 408, 79 A,L,R. 568, and Pompano Rorse Club et al, v.
State of Florida, 93 Fla. 415, 111 So, 801, 812, 52 A.L.R.
51.  From the latter, it cites the following:
            ,I0 Q 0 when a group of persons, each
       of whom has contributed money to a common
       fund and received a ticket or certificate
       representing such contrihutlo:?.adept a
       horse race,.the result of ur~lzh 13 uncer-
       thin, as h means of deto~minlng, by chance,
       which members of the group have won and
       which have lost upon a redlvlsion of that
       fund, each contributor havLng selected a
       stated horse to vln such race, the redeem-
       able value of the certificates so obtained
       and held by the contributors to such fund
       being varied or affected by the result of
       such race, so that the value of some is en-
       hanced, while that of others la reduced or
       destroyed, D S those who chose the winning
       horse being paid from the fund so accumu-
       lated more than they contributed thereto,
       by dividing amongst them the money contrl-
       buted by those who chose loalng horses and
       who therefore receive nothlffg,that proces8
       becomes a 'game of chance'.
The definition of "bet or wager' Is taken by the Court
from Rich v. State, 38 Tex. Cr. R.199, 42 S. W. 291, 292,
38 A.L,R. 719 as:

            "Ordinarily an agreement between two
       or more that a sum of money, or some valu-
       able thing, in contributing which all agree
       to take part, shall become the property of
       one or more of them, on the happening in the
       futurz of an event at the present uncertain
       0 * 1
          The plan contemplates such a transaction on
the part of drl.versphis friends and fans. The plan Is
not dlstingulshable in principle from those considered
in Opinion No. O-1704 of the Attorney General of Texas,
where purses were made up by entry fees in a dog race;
Wellston Kennel Club v; Castlen (MO.), 55 S. W. (2d) 288,
considering a method of subscribing to purses; State v.
Feak, 60 Ohio Appi 223, 20 NC E. 534, consldsring an op-
tlon method; Reinmiller v. State. 93 F1a~ 4i5.+111 Soc
601, 5;!A.L.R,51, considering a method of "investing" IA
                                                   ._-__--I
                                                   _~    .-




lion,Homer G&orison, Jr., Page 8,   V-727.


the "eBrning8 Of a 1308"" Oklahoma Kennel Club Y. estate,
155 Okla. 233, 8 P. (2dj 753, considering a “donation”
plan; fi parte McDonald, 86 Cal. App. 362, 260 P. 842,
considering another "contHbutlon" system; and State v.
AK - SAh - EEB Expoaitlon Co,, 119 P&b. 051, 226 N. W
705, considering a plan to distribute amounts in excea8
of regular purses end expenses to those contributora
thereto who picked winners.
          You are respectfully advised that the plan
contravenes Article 6528, Vernon's Penal Code.
                       SUMMARY
          $500.00 entrance fee charged midget
     auto drivers for the sole purpose of mak-
     ing up or lncreaslns the purse offered to
     the winner by the exhibitor is a "bet or
     wager", and sponsoring such arrangement
     constitutes "book making" under Article
     652a, v. P. c. Contributions to such en-
     trance fee by others in exchange for an
     interest in drivers' winnings are "bets
     or wagers", and sponsoring such activity
     conat.ltutes"book making" under .the same
     ArPtlcle.
                          Yours very truly
                      ATTORNEY QENERAL OF TEXAS



                                    Ned McDaniel
                                       Aasletant




NMC :JPC
