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State v. Fiola

Decided: July 11, 1990.

STATE OF NEW JERSEY, PLAINTIFF-APPELLANT,
v.
ANGELO FIOLA, A.C. FIOLA, INC., T/A LOTTO EXPRESS AND LOTTO EXPRESS, INC., DEFENDANTS-RESPONDENTS



On Appeal from Superior Court of New Jersey, Law Division, Hudson County.

J.h. Coleman, Muir, Jr. and Skillman. The opinion of the court was delivered by Skillman, J.A.D.

Skillman

Defendants are engaged in a business which involves the solicitation and receipt of money in New Jersey for the purchase of lottery tickets issued by other states, the transport of money to other states to purchase lottery tickets and the return of the tickets to New Jersey for delivery to customers. The Attorney General brought this action to enjoin defendants from engaging in this business, contending that it constitutes a continuing violation of New Jersey's constitutional and statutory prohibitions against gambling.

The trial court denied the Attorney General's application on the ground that injunctive relief would be inconsistent with the principle that equity will not enjoin the commission of a crime. Accordingly, the court dismissed the Attorney General's complaint without deciding whether defendants' business activities are illegal.

We conclude that defendants' business violates New Jersey's constitutional prohibition against gambling and that an injunction should be entered to prevent defendants from conducting this illegal business. Therefore, we reverse.

The New Jersey Constitution prohibits the Legislature from authorizing gambling "unless the specific kind, restrictions and control thereof" are approved by public referendum. N.J. Const., Art. IV, § 7, par. 2. The constitutional prohibition against gambling has been broadly construed. See, e.g., Atlantic City Racing Ass'n v. Attorney General, 98 N.J. 535, 489 A.2d 165 (1985); Carll & Ramagosa, Inc. v. Ash, 23 N.J. 436, 129 A.2d 433 (1957); Lucky Calendar Co. v. Cohen, 19 N.J. 399, 117 A.2d 487 (1955), on rehearing, 20 N.J. 451, 120 A.2d 107 (1956). This broad construction is reflective of New Jersey's "comprehensive," "clear" and "long standing" policy against gambling "except where specifically authorized by the people." Carll & Ramagosa, Inc. v. Ash, supra, 23 N.J. at 445, 129 A.2d 433; see also Caribe Hilton Hotel v. Toland, 63 N.J. 301, 307, 307 A.2d 85 (1973) ("our policy has become one of

carefully regulating certain permitted forms of gambling while prohibiting all others entirely.").

In light of the state constitutional prohibition against gambling, we conclude that the Attorney General is empowered to seek injunctive relief to prevent unauthorized gambling activity. Our courts have long recognized their power to enforce constitutional provisions even absent implementing legislation. See, e.g., Peper v. Princeton University Board of Trustees, 77 N.J. 55, 76-80, 389 A.2d 465 (1978); Cooper v. Nutley Sun Printing Co., Inc., 36 N.J. 189, 196-200, 175 A.2d 639 (1961). Our courts also have recognized that the Attorney General is an appropriate party to seek injunctive relief enforcing constitutional provisions where public interests are involved. See, e.g., Sills v. Hawthorne Board of Education, 84 N.J. Super. 63, 200 A.2d 817 (Ch.Div.1963) aff'd o.b. 42 N.J. 351, 200 A.2d 615 (1964) (injunction prohibiting conduct of religious ceremonies in public schools); Kimmelman v. Burgio, 204 N.J. Super. 44, 497 A.2d 890 (App.Div.1985) (injunction prohibiting use of misleading interpretative statement on ballot in connection with state constitutional amendment).

We further conclude that defendants' business constitutes gambling within the intent of Article IV, § 7, para. 2 of the New Jersey Constitution. In State v. Western Union Telegraph Co., 12 N.J. 468, 490, 97 A.2d 480 (1953), app. dism. 346 U.S. 869, 74 S. Ct. 124, 98 L. Ed. 379 (1953), the Court held that Western Union and one of its local managers engaged in gambling by regularly receiving betting messages and telegraphic money orders from its customers and transmitting them to a bookmaker at another location. Similarly, defendants' business of receiving money to purchase lottery tickets, transporting the money to another state to purchase lottery tickets and transporting the tickets back to New Jersey for delivery to its customers, constitutes gambling activity involving the transmission of gambling messages and money for gambling operations conducted by others.

Moreover, defendants' gambling activity is clearly unauthorized. Although the voters approved a constitutional amendment authorizing the New Jersey state lottery, N.J. Const., Art. IV, § 7, par. 2(C), this amendment did not authorize anyone to participate in another state's lottery within New Jersey. As the court observed in Atlantic City Racing Ass'n v. Attorney General, supra, 98 N.J. at 546, 489 A.2d 165, "[i]n construing the provisions of a constitutional amendment that effect a limited exception to a comprehensive constitutional prohibition of gambling it is the long-standing general policy of our courts to interpret those provisions narrowly and to refrain from extending them beyond their normal and common usage." Consistent with this strict approach to the construction of gambling referenda, the authorization of a lottery operated and regulated by the State of New Jersey cannot be construed to authorize defendants' unregulated activities involving lotteries operated by other states.

This conclusion is reinforced by various statutory provisions establishing criminal liability for illegal gambling activity. Thus, N.J.S.A. 2C:37-2a(2) provides in pertinent part that "[a] person is guilty of promoting gambling when he knowingly . . . [e]ngages in conduct, which materially aids any form of gambling activity" and N.J.S.A. 2C:37-3a(2) provides in pertinent part that "[a] person is guilty of possession of gambling records when, with knowledge of the contents thereof, he possesses any writing, paper, instrument or article . . . [o]f a kind commonly used in the operation, promotion or playing of a lottery . . . ." Although defendants' criminal culpability is not before us, the conclusion appears inescapable that the transport of gambling requests and money to out-of-state gambling sites and the return of lottery tickets to gamblers in New Jersey "materially aids [a] ...


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