Could a South Carolina charity hold a casino night with chips but no cash prizes?

Plain-English summary

In October 2017, a Pickens County sheriff’s captain asked about a private organization’s “Monte Carlo-style” charity casino night. The South Carolina Attorney General restated its long-standing view that charitable motives did not exempt gambling events from the state constitution’s lottery restrictions.

The letter focused on the value of continued play. Citing earlier cases and AG opinions, it explained that amusement or entertainment could have value to a player. A casino style event that removed money or merchandise prizes could still violate gambling law if betting chips in chance games let winners keep playing. The opinion did not supply a definitive list covering every event design; it referred readers to prior opinions for the fuller legal analysis.

The letter gave a general statement of the AG’s view and did not set out detailed facts about a specific ticketed event.

Currency note

This opinion was issued in 2017. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Q: Did the charity’s purpose make the casino night exempt?
A: The AG said no. Its reading of the constitutional exceptions did not create a general exception for charity casino events.

Q: Did removing cash or merchandise prizes settle the gambling question?
A: No. The letter said winning the chance to continue playing could itself supply value.

Q: Did this letter assess a specific ticket price or chip policy?
A: No. It gave a general response to the captain and did not supply a detailed event plan for approval.

Background and statutory framework

The opinion quoted the state constitution’s limited exceptions for state lotteries, certain bingo games, and legally authorized nonprofit raffles. It then relied on South Carolina cases concerning free games and entertainment value to explain why a casino night without a material prize could still be unlawful.

Citations and references

• The letter quoted the state constitution’s restriction on lotteries and its specified exceptions.
• It said casino games with chips that let a winner continue playing still violated state law under the AG’s prior analysis.

Official title

On the legality of gambling in the context of a "casino night" held by a private organization as a charity fundraiser.

Requester

Captain Chad Brooks, Pickens County Sheriff's Office.

Source

• Landing page: https://www.scag.gov/opinions/opinions-archive/october-11-2017-2/
• Original PDF: https://www.scag.gov/wp-content/uploads/2017/10/Brooks-C.-OS-10200-FINAL-Opinion-10-11-2017-01494744xD2C78.pdf-01497856xD2C78.pdf

Original opinion text

1

Alan Wilson
ATTORNEY General

October 11, 2017

Captain Chad Brooks
Pickens County Sheriffs Office
216 C. David Stone Rd.

Pickens, SC 29671

Dear Cpt. Brooks:

We appreciate you reaching out to our Office regarding the legality of gambling in the context of a "Monte Carlo-style" casino night held by a private organization as a charity fundraiser.

Let it be known that the South Carolina Attorney General's Office unequivocally and resolutely holds to its long-standing position that such gambling events are illegal under the law of this state, no matter how noble the cause. See, e.g., Op. S.C. Att'y Gen., 1997 WL 811909 (December 4, 1997)(concluding that the South Carolina Law Enforcement Officers' Association could not legally hold a fund-raising raffle under then-current law, even to fund a line-of-duty death benefit). We have opined on this matter on several occasions, so we will only summarize some of the relevant law here, while reiterating that we stand by the reasoning and conclusions of each of those opinions. See, e.g.. Op. S.C. Att'y Gen., 2011 WL 782313 (February 18, 2011) The primary purpose of this opinion is to reiterate our commitment to upholding the law on this subject as set put in the Constitution of South Carolina and expounded by the South Carolina Supreme Court. See Darlington Theatres, Inc. v. Coker, et al, 190 S.C. 282, 292, 2 S.E.2d 782, 786(1939); also Harvie v. Heise, 150 S.C. Ill, 287, 148 S.E. 66,69(1929). The voters of South Carolina have enshrined the prohibition of lotteries and games of chance, with certain narrow exceptions, into the South Carolina Constitution. S.C. Const, art. XVII,§ 7 provides, in relevant part: Only the State mav conduct lotteries, and these lotteries must be

conducted in the manner that the General Assembly provides by law. The game of bingo, when conducted by charitable, religious, or fraternal organizations exempt from federal income taxation or when conducted at recognized annual state and county fairs, is not considered a lottery prohibited by this section.

A raffle, if provided for bv general law and conducted by a nonprofit organization for charitable, religious, fraternal, educational, or other ReniBERT C. Den-nis Building • Post Office Box 11549 • Columbia,SC 29211-1549 • Telephone 803-734-3970 • Facsimile 803-253-6283

Captain Chad Brooks
Page 2

October 1 1, 2017

eleemosynary purposes, is not a lottery prohibited by this section. The general law

must define the type of nonprofit organization authorized to operate and conduct a raffle, provide standards for the operation and conduct of raffles, provide for the use

of proceeds

for

religious,

charitable,

fraternal,

educational,

or

other

eleemosynary purposes, provide penalties for violations, and provide for other laws necessary to ensure the proper functioning, honesty, and integrity of the

raffles. If a general law on the conduct and operation of a nonprofit raffle for charitable purposes, including the type of organization allowed to conduct raffles,

is not enacted, then the raffle is a lottery prohibited by this section. S.C. Const, art. XVII, § 7 (emphasis added). Accordingly, any examination of a contemplated lottery or game of chance must begin with these constitutional mandates in mind. The inclusion

of specific exceptions here implicitly invokes n[t]he canon of construction, "expressio unius est exclusio alterius" or "inclusio unius est exclusio alterius" [which] holds that "to express or include one thing implies the exclusion of another, or of the alternative." Hodges v. Rainey, 341

S.C. 79, 86, 533 S.E.2d 578, 582 (2000) (quoting Black's Law Dictionary 602 (7th ed. 1999)). Indeed, as our Office has previously opined regarding lotteries specifically, "it goes without saying that the General Assembly may not permit what the Constitution expressly prohibits." Op. S.C. Att'y Gen., 1997 WL 811909 (December 4, 1997); cf. Alexander v. Martin, 192 S.C. 176, 6 S.E.2d 20 (1939) ("The licensing of these machines by the State Tax Commission cannot make a lawful machine out of a gambling device, and the payment of the license does not authorize the operation of machines which come within the prohibition of [state law].").

While this Office cannot set out a definitive list of all factual scenarios which constitute

illegal gambling, we have thoroughly discussed the relevant law in our prior opinions. See, e.g., Op. S.C. Att'y Gen., 201 1 WL 782313 (February 18, 201 1) (discussing the three-part test set out

by the South Carolina Supreme Court in Darlington Theatres, Inc. v. Coker, et al, 190 S.C. 282, 292, 2 S.E.2d 782, 786 (1939).). For the purposes of your question, we note specifically that our

Office has previously opined that "our Supreme Court, at least on one occasion, interpreted the amusement or entertainment as having value to the person engaged in the activity."

Id.

This

opinion relied in part upon the 1929 case of Harvie v. Heise, where the Court stated "the

amusement or entertainment furnished the player is worth something to him if it constitutes the inducement for him" to continue playing the game of chance, which in that instance was a slot machine.

Harvie v. Heise, 150 S.C. 277, 287, 148 S.E. 66, 69 (1929).

Our Supreme Court

elaborated on this holding ten years later in Alexander v. Martin, where it described a gaming machine where "contingent upon the score recorded for a player, free games are awarded." Alexander v. Martin, 192 S.C. 176, 6 S.E.2d 20 (1939). The Court concluded:

Therefore, it is clear that the lure and inducement to the player to operate the machine is the chance of occasionally being allowed to play a game or games

Captain Chad Brooks
Page 3
October 11,2017

without additional cost. This feature, we think, clearly pertains to a game of chance. And this is true, whether the machine is played for amusement or for

other returns, such as money.
Id. (citing Harvie v. Heise).

For that reason, where a casino-style event attempts to circumvent

South Carolina gambling laws by removing the element of a material or monetary prize but

attempts to preserve the feel of a casino with the betting of chips in poker, roulette, or similar games of chance that allow a person to continue playing if they win, it is the opinion of this Office that such an event still violates state law. See Op. S.C. Att'y Gen., 2011 WL 782313 (February 18,2011).

While this result may seem harsh given the charitable motives of many persons involved, it is the duty of this Office to uphold the rule of law in this state. The people of this state have enshrined exceptions.

the

prohibition

on

gambling

S.C. Const, art. XVII, § 7.

in

our state's

constitution,

with

narrowly-limited

This provision has been amended before, and it is the

prerogative of the people to do so again, if they desire. See, e.g., Act No. 3, 2015 S.C. Acts 26 (amending S.C. Const, art. XVII, § 7).

But until such an amendment is passed, our Office is

duty-bound to ensure that the state's constitution, as currently written, is not rendered a nullity merely because it leads to an unpopular result in this instance. We note that this advisory opinion is based only on the question presented, the current law, and the information which you provided to us. This opinion is not an attempt by this Office

to establish or comment upon public policy. This opinion is not an attempt to comment on any pending litigation or criminal proceeding.

Until a court or the General Assembly specifically

addresses the issues presented in your letter, this is only an opinion on how this Office believes a court would interpret the law in this matter.

You may also choose to petition a court for a

declaratory judgment, as only a court of law can interpret statutes and make such determinations. See S.C. Code Ann. § 15-53-20 (2005).

If it is later determined that our opinion is erroneous in

any way, or if you have any additional questions or issues, please do not hesitate to contact our Office. A copy of this opinion is being provided to Adam Whitsett, Esq., as Chief Counsel for the South Carolina Law Enforcement Division.

Sincerely,

-p^r=

"David S. Jones
Assistant Attorney

:neral

Captain Chad Brooks
Page 4

October 11,2017

REVIEWED AND APPROVED BY:

•Robert D. Cook
Solicitor General