R. J. Williams Furniture Co. v. McComb Chamber of Commerce

Anderson, J., delivered the opinion of the court. The appellants, R. J. Williams Furniture Company and others, merchants of McComb city, filed their bill in the chancery court of Pike county, against the appellees, the McComb Chamber of Commerce and certain merchants of McComb city, members of the chamber of com *655 merce, to enjoin the latter from carrying out what is denominated in the bill and the testimony in the case as “trades day” or “profit-sharing campaign,” conducted in McComb city under the auspices of the chamber of commerce. There was a hearing before the chancery court on bill, answer, and proofs, resulting in a decree denying the injunction prayed for and dismissing the appellants ’ hill, from which decree appellants prosecute this appeal. The bill alleged that the proposed “trades day” or ‘ ‘ profit-sharing campaign, ’ ’ conducted under the auspices of the McComb Chamber of Commerce, was violative of the ató-trust laws of this state, and also that it was a lottery and a gambling scheme, and therefore illegal, immoral, and inimical to the public welfare. There was little, if any, conflict in the material-evidence in the case. The “trades day” or “profit-sharing campaign” was by the chamber of commerce, and the merchants of McComb, who were members of the chamber of commerce, inaugurated to promote trade. It was conducted under the auspices of the chamber of commerce through its board of directors. The chamber of commerce sold to the retail merchants of McComb city, who were its members, tickets in lots of five hundred and one thousand, for which the merchants paid at the rate of seven dollars per thousand. The proceeds of the sale of tickets were paid -into the treasury of the chamber of commerce and constituted a fund out of which prizes were given to customers of the retail merchants holding numbers corresponding to the numbers on the prizes drawn. The tickets were perforated in the middle with the same number on each end, the retail merchant selling goods to a customer retaining one end and the customer taking the other. The retail merchants were not permitted to give these tickets away to their customers, but were allowed to give each customer one ticket on either the purchase by the customer of one dollar’s worth of goods or the payment by the *656 customer of one dollar on account. Nor were the merchants allowed to sell the tickets to their customers, and nothing was added to the usual price of the goods sold to them on account of their receiving’ the tickets. Each customer holding’ a ticket was entitled to a chance in the drawing’ of eig’ht prizes offered by the Merchants’ Exchange. These prizes consisted of two ten-dollar prizes, two fifteen-dollar prizes, two twenty-five-dollar prizes.' and one fifty-dollar and one one hundred-dollar prize. The prizes were paid for by the Merchants’ Exchange out of the proceeds of the sale of tickets to the merchants in McComb1 city, who constituted its members. The “trades day” covered a period of sixteen weeks, from September 11 to December 27, 1926. The prize drawings were held on every Saturday of each' week during that period. The customers of the retail merchants, holding the tickets with numbers corresponding to the numbers on the prize tickets drawn at the weekly drawings received the prizes in cash. Appellants contend that this “trades day” scheme of the McComb Chamber of Commerce and its members constituted a trust or monopoly in the retail mercantile business of McComb city, in that it was a combination between them in restraint of trade, in violation of section 5002, Code of 1906 (sections 3281 to 3283, inclusive, Hemingway’s Code). Appellants’ position, we think, is without, foundation. We are of the opinion that instead of the “trades day” scheme in question being a trust or combination in restraint of trade, it was rather a plan calculated to stimulate trade, and that instead of having the effect of stifling competition among the retail merchants of McComb city, its effect would be to stimulate such competition; and, furthermore, whatever benefits the retail merchants, who were members of the chamber of commerce, received by virtue of the plan were open to all the retail merchants of the city on becoming nfembers of the Merchants’ Ex *657 change. Nor do we see anything in the plan that would be detrimental to the public morals or inimical to the public welfare. Appellants contend that the “trades day” scheme constituted a lottery or a gambling device, in violation of sections 1277 to 1280, inclusive, Code of 1906 (sections 1009 to 1012, inclusive, Hemingway’s Code). It will be observed from those statutes that they do not undertake to define what shall constitute a lottery. Resort therefore must be to the common law for that purpose. Three essential elements are necessary to constitute a lottery: (1) The offering of a prize; (2) the awarding of a prize by chance; (3) the giving of a consideration for the opportunity to win the prize; and all three of these elements must concur in order to constitute a lottery. The offering and the award of a prize by chance are not sufficient. There must be added, in order to make it a lottery, that the prize winner give a consideration for the opportunity to win the prize. 38 C. J., p. 289, section 1; 17 R. C. L., section 10. A lottery is a form of gambling. Under the law, in order to constitute gambling, the winner in the game must' either pay a consideration for his chance to win, or he must, without paying anything in advance, stand a chance to lose or win. As stated, the retail merchants of McComb, taking part in this scheme to promote trade gave away to their customers the chances to win the prizes, the customers paying nothing whatever therefor and standing no chance to lose. Affirmed.