Bradley v. Doherty
1973 Cal. App. LEXIS 1226, 106 Cal. Rptr. 725, 30 Cal. App. 3d 991 (1973)
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Rule of Law:
Under the doctrine of in pari delicto, courts will not grant relief to a party seeking to recover money lost in an illegal gambling transaction, even if the gambling game was fraudulent or fixed by the other party.
Facts:
- Respondents operated a cocktail lounge and bar known as the Orchid Room.
- Appellant lost approximately $70,000 at the Orchid Room by betting on the outcome of various games, including pinball.
- Appellant alleged that he was induced to play by respondents' misrepresentations that the games were ones of skill and chance.
- Appellant alleged that the games were not fair, but were 'fixed, rigged and manipulated' by respondents.
- The manipulation was allegedly accomplished through 'hidden electronic, magnetic and sonic devices' used to control the games.
Procedural Posture:
- Appellant filed a complaint against respondents in the San Mateo County Superior Court (trial court).
- Respondents filed a demurrer, a motion to dismiss for failure to state a claim.
- Appellant filed an amended complaint, which included a fifth cause of action to recover $70,000 lost in allegedly fraudulent betting.
- The trial court sustained respondents' demurrer to the fifth cause of action without leave to amend, effectively dismissing that claim.
- The trial court also dissolved a temporary restraining order and denied appellant's motion for a preliminary injunction that sought to freeze respondents' assets.
- Appellant appealed the trial court's judgment on the demurrer and its order on the injunction to the California Court of Appeal.
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Issue:
Does the doctrine of in pari delicto bar a plaintiff from recovering money lost in an illegal gambling game that was allegedly 'fixed' or rigged by the defendant?
Opinions:
Majority - Bray, J.
Yes. The doctrine of in pari delicto bars recovery because courts will not aid parties involved in an illegal contract or transaction. California law rigidly enforces the rule that parties to an illegal wagering contract cannot use the courts to recover their losses or winnings. This principle applies even when one party alleges being cheated, as public policy precludes courts from acting as arbiters for illegal activities or attempting to distinguish between the degrees of wrongdoing of the participants. Because both parties voluntarily engaged in gambling prohibited by the Penal Code, they are considered in equal fault, and the law will leave them as it finds them.
Analysis:
This decision reaffirms the stringent application of the in pari delicto doctrine in California to illegal contracts, particularly in the context of gambling. The court's refusal to create an exception for fraud or cheating solidifies the principle that a participant's 'unclean hands' will prevent them from seeking judicial relief for any wrongs suffered during the illegal activity. This precedent strongly discourages such litigation by closing the courthouse doors to participants, signaling that arguments based on being cheated or having a gambling compulsion are unlikely to succeed. The ruling reinforces the public policy of deterring illegal conduct by denying any legal remedy to those who engage in it.
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