Cleveland v. Wolff

The opinion of the court was delivered by Valentine, J.: The defendant in error, Frederick GL Wolff, and one Joseph Kellam, bet two hundred dollars each on a horse-race, each betting on his own horse, and deposited the money with the plaintiff in error, James S.. Cleveland, as a stakeholder. The horses were to run five heats, but before the last heat was run, and before it was determined which of the parties had won, or would win, the said Wolff became dissatisfied, refused to let his-horse run the last heat, demanded of the said stakeholder his part of the said money, and notified him not to pay it to any one else. The last heat was run by Kellam’shorse alone; Kellam was declared to be the winner, and the stakeholder paid all the money over to Kellam. Wolff’ then sued the stakeholder for the money he had deposited with him. The only question that has been raised in this court,, or that was raised in the court below, is, whether the stakeholder is liable. At common law, all betting or wagering contracts, which affected injuriously the interests, feelings, or character of third persons, or led to indecent evidence, or were contrary to public policy, or tended to immorality, or a breach of some law, were held to be void; and such is now the law. Formerly, in England, it was supposed that a great proportion of the wagering contracts were not subject to any of said objections, and were therefore not void, but valid. Such is not the case in this country, and at the present day. Now, as a rule, all betting or wagering contracts are considered as inconsistent with the interests of society, at variance with the laws of morality, against public policy 7 [188] and therefore void. The contract between the parties to •the wager being void, the stakeholder is held to be the mere agent or bailee of the respective parties, and he holds the money deposited with him subject to their •orders. If his authority be not revoked, he may pay it over to the winner without rendering himself liable to an action; but if his authority be revoked by either party before he pays the money over to the winner, he must then ■return the money to the parties respectively who deposited it with him, and he cannot pay it to any one else' Under the decisions of adjudicated cases, it seems that the stakeholder is not held to be in pari delicto with the ¡persons who are the parties to the wagering contract. He does not share in their guilt. That portion of the transaction with which he is connected is innocent; or at most, it is not in violation of any statute, and if in contravention of public policy or morality at all, it is so slightly so that in a suit like this, the rule that the law will leave all who share in the guilt of an illegal or immoral transaction where it finds them, has no application-The betting is wrong, but the depositing the money in ■the hands of an agent or bailee, to be paid out by him in accordance with the instructions of the depositors, seems do be an innocent transaction. Were it otherwise, another rule might prevail. Were it illegal to deposit -the money, then the rule applied in the case of Dolson v. Hope, (ante, p. 161,) that “courts cannot become auxiliary to the consummation of violations of the law,” and the rule applied in some of the cases referred to by counsel for plaintiff in error, would have some application in this case. (But see Jennings v. Reynolds, 4 Kas., 110, and Comp. Laws, 335, § 242.) The judgment of the court below is affirmed. All the Justices concurring.