CHUUK STATE SUPREME COURT TRIAL DIVISION
Cite case as Pacific Coast Enterprises v Chuuk, 9 FSM Intrm 543 (Chk. S. Ct. Tr 2000)

PACIFIC COAST ENTERPRISES, PACIFIC GARDEN
HOTEL, MNL ENTERPRISES and FONO MUNICIPALITY,
Plaintiffs,

vs.

CHUUK STATE GOVERNMENT,
Defendant.

______________________________________________________

CSSC CA NO. 85-2000

ORDER GRANTING INJUNCTION AND JUDGMENT ON THE MERITS

Wanis R. Simina
Associate Justice

Hearing: August 15, 2000
Decided: October 11, 2000

APPEARANCES:

For the Plaintiff:
Johnny Meippen, Esq.
P.O. Box 705
Weno, Chuuk FM 96942

For the Defendant:
Joses Gallen, Esq.
Assistant Attorney General
Office of the Chuuk Attorney General
P.O. Box 189
Weno, Chuuk FM 96942

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HEADNOTES

Constitutional Law - Chuuk - Interpretation; Statutes - Construction
When a case's disposition and the plaintiffs' sought relief do not require construction of statute as to its constitutionality, courts will not undertake a decision based upon a constitutional issue. Pacific Coast Enterprises v. Chuuk, 9 FSM Intrm. 543, 545 (Chk. S. Ct. Tr. 2000).

Constitutional Law - Chuuk - Interpretation
While courts will not refuse to pass on the constitutionality of statutes in any proceeding in which such a determination is necessarily involved, the courts' invariable practice is not to consider the constitutionality of state legislation unless it is imperatively required, or unavoidable. Pacific Coast Enterprises v. Chuuk, 9 FSM Intrm. 543, 545 (Chk. S. Ct. Tr. 2000).

Constitutional Law - Chuuk - Interpretation; Separation of Powers - Chuuk
The principle of avoiding constitutional questions was conceived out of considerations of sound judicial administration and is in accord with the principle of separation of powers of government. Pacific Coast Enterprises v. Chuuk, 9 FSM Intrm. 543, 545 (Chk. S. Ct. Tr. 2000).

Constitutional Law - Chuuk - Interpretation; Statutes - Construction
The court will not rule on a statute's constitutionality when it can limit the case's disposition to interpretation of the statute's language as it applies to the question. Pacific Coast Enterprises v. Chuuk, 9 FSM Intrm. 543, 545 (Chk. S. Ct. Tr. 2000).

Constitutional Law - Chuuk; Gambling
While under the Chuuk Constitution the "powers and functions of a municipality with respect to its local affairs and government are superior to statutory law," the key phrase in this constitutional provision is "local affairs." Gambling is of statewide concern and an area properly within the state legislative function and does not fall under the cloak of "local affairs." Pacific Coast Enterprises v. Chuuk, 9 FSM Intrm. 543, 546 (Chk. S. Ct. Tr. 2000).

Constitutional Law - Chuuk
The Chuuk Constitution provision granting municipalities "superior" powers is of such unique character that no similar constitutional provision has been found which gives municipalities such extensive control over legislative affairs. Pacific Coast Enterprises v. Chuuk, 9 FSM Intrm. 543, 546 (Chk. S. Ct. Tr. 2000).

Gambling; Statutes - Construction
When an act lists 23 different and distinct prohibited gaming devices, including "slot machines," but makes no mention of "poker machines" whatsoever, by its failing to list "poker machines" in an extended list of prohibited items, the legislature excluded such machines from the application of the law, and the court will not include the machines into the proscription of the statute something which the Legislature intended to exclude. Pacific Coast Enterprises v. Chuuk, 9 FSM Intrm. 543, 547 (Chk. S. Ct. Tr. 2000).

Gambling
Although there is an element of chance involved in the operation of both slot and poker machines, the fundamental difference between a slot machine and a poker machine is that a poker machine, as opposed to a slot machine, allows the user to exercise his skill to affect the odds and thereby the manner and result of its operation. Pacific Coast Enterprises v. Chuuk, 9 FSM Intrm. 543, 547 (Chk. S. Ct. Tr. 2000).

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COURT'S OPINION

WANIS R. SIMINA, Associate Justice:

This case comes before the Court after notice and hearing on Plaintiffs' request for Declaratory Judgment and for a Preliminary Injunction to prohibit the Defendant Chuuk State from enforcement of Chk. S.L. No. 2-94-21. The matter arises out of the closure of Plaintiffs business by Defendant Chuuk State, which was done under the authority and for the enforcement of the Gambling prohibitions provided for in Chk. S.L. No. 2-94-21. On July 18, 2000, this Court entered a Temporary Restraining Order that the Defendant Chuuk State refrain from enforcing said law and scheduled a hearing on Plaintiffs' Petition for a Preliminary Injunction for July 25, 2000. On this latter date, a hearing was held during which Counsel for Plaintiffs filed a Memorandum of points and authorities in support of his motion for Preliminary Injunction. Defendant Chuuk State then moved for a continuance, and without objection, the matter was continued to August 15, 2000, at which time the Court heard arguments and considered the Plaintiffs' Memorandum in support of the Motion for Preliminary Injunction and matters going to the merits of the Complaint for Declaratory Judgment.

Based on the pleadings and arguments, the parties have raised the issue of whether Chk. S.L. No. 2-94-21 is unconstitutional as being vague, overbroad and beyond the power if Chuuk State in view of Article XIII, § 5, of the Chuuk State Constitution. The disposition of this case and the relief for which Plaintiffs seek does not require construction of Chk. S.L. No. 2-94-21 as to its constitutionality and in such cases, courts will not undertake a decision based upon a constitutional issue.

As stated in 16 Am. Jur. 2d Constitutional Law § 160 (1979) (footnotes omitted):

While courts will not refuse to pass on the constitutionality of statutes in any proceeding in which such a determination is necessarily involved, they will not make a ruling on a matter of constitutional law where there is a lack of this necessary involvement, needless consideration of attacks on their validity and unnecessary decisions striking down statutes will be avoided. …..

It has been stated that the invariable practice of the courts is not to consider the constitutionality of state legislation unless it is imperatively required, or unavoidable. …..

The principle of avoiding constitutional questions has been described as one which was conceived out of considerations of sound judicial administration, and which has become a traditional policy of American courts. Moreover, it is in accord with the principle of separation of powers of government.

Based on the foregoing analysis, this court will limit its disposition of this case to the interpretation of the language of Chk. S.L. No. 2-94-21 as it applies to the action of the Defendants in closing the business property in question.

It appears to the court from the pleadings and matters stated in open court, that the defendants thought the Plaintiffs were operating a business wherein "poker machines" were used and that such use constituted a violation of Chk. S.L. No. 2-94-21. Based on such belief, the Defendant, through its police powers, summarily closed the businesses operated by Plaintiffs.

The Plaintiff, Fonoton Municipality, appears to be without standing to become a party in this case. However, the arguments of Counsel and the basic issue raised by the inclusion of Fonoton Municipality will be addressed.

The argument of Counsel that the business Plaintiffs are unconstitutionally denied equal protection due to the lack of adequate or limited enforcement personnel of Defendant, is totally without merit and further discussion is unnecessary. Further, the conclusion reached herein renders this issue moot.

On behalf of Plaintiff Fonoton Municipality, Counsel argues that Chk. S.L. No. 2-94-21 "infringes upon the power of the Municipality of Fonoton to regulate gaming and gambling within its own jurisdiction" and for this reason is contrary to Article XIII, § 5 of the Chuuk State Constitution which states in part as follows: "The powers and functions of a municipality with respect to its local affairs and government are superior to statutory law."

The key phrase in this constitutional provision is "local affairs." There is little doubt that gambling is of statewide concern and an area properly within the State legislative function. This rule is of such universal application as to make citations unnecessary. The Constitution of Chuuk State is of such unique character that this Court has found no similar constitutional provision which gives municipalities such extensive control over legislative affairs. Thus, the issue is whether gambling falls under the cloak of "local affairs." This Court thinks not.

By analogy, the case of In the Matter of Slot Machines, 3 FSM Intrm. 498 (Truk S. Ct. Tr. 1988) speaks of gambling as not just a matter of "local affairs," but a matter of both State and National affairs, and further, a matter of concern throughout Micronesia. The Slot Machine case, supra, quotes extensively from an Ad Hoc Committee Report to the High Commissioner, Trust Territory of the Pacific Islands entitled "Gambling in Micronesia," published March 24, 1975. The Court stated: "The current and potential socioeconomic impact to the gambler, family, clan and community resulting from the abuse of gambling is extremely destructive and can only cause further disintegration of Micronesian culture." In re Slot Machines, 3 FSM Intrm. at 501.

Based on the foregoing analysis, this Court is compelled to hold that gambling is a matter of state wide concern and does not fall within the "local affairs" reference of Article XIII, § 5 of the Chuuk State Constitution. And, as stated in 38 Am. Jur. 2d Gambling § 17 (1968): "It seems clear that a municipality cannot authorize by ordinance a particular gambling activity which is prohibited by statute."

An additional analogy is drawn from the concept of "home-rule" cities. Under "home-rule" provisions of a state constitution, municipalities have the power to determine their "local affairs" and government, subject only to such enactments of the legislature of statewide concern.

In applying this rule, the Court in Kansas City v. J.I. Case Threshing Mach. Co., 337 Mo. 913, 87 S.W.2d 195 (1935) observed that the preservation of order, the enforcement of law, the protection of life and property, and the suppression of crime are attributes of state sovereignty and matters of statewide concern, and when the legislature enacts a general law upon any of these subjects such law applies to home-rule cities.

On the issue of whether Chk. S.L. No. 2-94-21 prohibits the operation of a business involving the use of "poker machines," the case of In re Slot Machines, 3 FSM Intrm. 498 (Truk S. Ct. Tr. 1988) raises almost the identical question and under the doctrine of res judicata, this Court is bound by that decision and must conclude that Chk. S.L. No. 2-94-21 does not prohibit the possession and use of "poker machines" such as the ones which formed the basis for the closure of Plaintiff's businesses.

In the Slot Machine case, a case of over 12 years standing, the Court noted that the government had seized "poker machines" pursuant to a search warrant which named "slot machines." In denying the prosecutor's request for forfeiture and for providing for release of the poker machines, the Court said: "If the government desired to seize poker machines why did they not so state in their application for a search warrant?" Slot Machines, 3 FSM Intrm. at 500.

The same question can be asked of Chk. S.L. No. 2-94-21, if the legislature had intended to prohibit "poker machines" why did they not so state in the legislation? This Act lists 23 different and distinct gaming devices which the Law prohibits, including "slot machines," but makes no mention of "poker machines" whatsoever. This fact seems to bring the case within the well recognized rule that by its failing to list "poker machines" in an extended list of prohibited items, the legislature intended to exclude such machines from the application of the law.

To further clarify this Court's decision in the case at bar, it is necessary to quote at length from the Slot Machine case. The Court said: "This court recognizes that there is, without a doubt, an element of chance involved in the operation of both slot and poker machines." Slot Machines, 3 FSM Intrm. at 500.

In concluding that a poker machine was not a gaming device, the court further said: "However, the fundamental difference between a slot machine and a poker machine is that a poker machine, as opposed to a slot machine, allows the user to exercise his skill to affect the odds and thereby the manner and result of its operation." Id.

By paraphrasing the conclusions reached in the Slot Machine case, supra, this court concludes as follows:

The only gambling devices of the type here in issue subject to current legislative prohibition are "slot machines," and not "poker machines."

This court will not include the machines into the proscription of the statute something which the Legislature intended to exclude.

The machines subject to this hearing are currently not subject to government control.

Accordingly, this court concludes that all action of the government relative to the closure of Plaintiff's businesses based on the possession of "poker machines" was without legal authority and that all property of Plaintiffs seized by the government is due to be returned to Plaintiffs and that the Defendant government is permanently enjoined from interfering with Plaintiff's business in the use of "poker machines" under current law, and it is so ordered.