Marianas General Corp. v. Government of the Northern Mariana Islands
Opinion of the Court
OPINION
Defendant-Appellant Commonwealth of the Northern Mariana Islands (NMI) appeals the trial court's grant of summary judgment to plaintiff-appellee Marianas General Corporation (MGC) The lower court ruled that the NMI must refund a license application fee paid pursuant to a statute repealed by referendum after MGC paid the fee. The court so concluded
The material facts are undisputed. On July 4, 1979, MGC paid to the NMI Treasury a $10,000 application fee hoping to be awarded a gambling license later. Section 21(a) of Public Law 1-14 (The Casino Gambling Act)' required remittance pf the fee and specified that it was non-refundable.
MGC initiated this action on August 27, 1981. The parties filed cross-motions for summary judgment. On February 13, 1981, the trial court granted MGC's motion and denied the NMI's. The court found that the Casino Gambling Act's repeal frustrated the basis for which MGC tendered the fee. It reasoned that Section 21(a)'s non-refundability provision therefore could not be applied. It based its ruling for MGC upon general equitable restitutionary principles as well as upon contract doctrines of frustration, failure of consideration, impossibility of performance, supervening illegality and anticipatory repudiation.
Because the facts are undisputed, the questions on appeal are purely legal. We find that the trial court erred in holding that the Casino Gambling Act's repeal frustrated the statutory purpose for which MGC paid the application fee, and thus caused a failure of consideration. A gaming act's provision must be construed in a manner so as to render them compatible with each other. State v. Rosenthal, 93 Nev. 36 559 P.2d 830, 836 (Nev. 1977), appeal dism. 434 U.S. 803, 98 S.Ct. 32, 54 L.Ed. 2d 61 (1977). Our reading of the Casino Gambling Act convinces us that the sole purpose of the Section 21(a) application fee was to enable MGC to obtain a preliminary investigation of its qualifications pursuant to Section 13. The application fee entitled MGC
If the money which MGC paid had been a license fee, we would have a different case. As'the'NMI concedes,
In Section 21(a), the context suggested otherwise. Section 21(a) clearly contemplated two distinct fees. One was the initial application fee. The second was a "$1,000,000 - or - 20Z -of- revenue" fee to be paid by applicants who had been granted licenses. The second fee is the license
Citing Ex Parte McCardle, 74 U.S. 506, 19 L.Ed. 264, 265 (1869) and 1A Sutherland, Statutory Construction §23.33 (4th Ed. 1972) (1A Sutherland), MGC states that a repealed Act is treated as if it never existed. MGC contends that therefore it is entitled to a refund because the repeal of the Casino Gambling Act nullified Section 21(a)'s provision that the application fee was nonrefundable.
The Court rejects this creative but fatally flawed argument. Unless express or implied legislative intent indicates otherwise, the repeal of a statute operates only prospectively; - it does not undo the consequences of its operation while it was in force. Chism v Phelps, 228 Ark. 936, 311 S.W. 2d 297, 77 ALR 2d 329, 335 (Ark. 1958).
The Court accordingly rejects MGCs additional assertion that the NMX’s retention of the application fee violates the Fifth Amendment to the United States Constitution by depriving MGC of property without due process. As noted above, the NMI is legally entitled to retain the application fee. The NMI gave MGC what it paid for: an assessment and disposition of its application. Moreover, assuming arguendo that MGC claims a constitutionally protected property interest in a gaming license, we find no basis for that claim. To have a constitutionally protected property interest in a benefit, one must have a legitimate claim of entitlement to it. Board of Regents v. Roth, 408 U.S. 564, 577, 92 S.Ct. 2701, 2709, 33 L.Ed.2d 548 (1972). A legitimate claim is one which is something more than a unilateral expectation of the benefit. Id. A person who receives a gaming license arguably obtains a property interest in the license; a person who has never been given a license clearly receives no such interest.
In paying its application fee to .the-NMI, MGC took a chance on the future of casino gambling in the Northern Mariana Islands. In November, 1979, the electorate decided that casino gambling was to have no future. MGC "cannot be permitted to speculate upon the community’s not exercising Its constitutional powers and' then claim that the community is barred from interfering with the'speculation." Primm v. City of Reno. 70 Nev. 7 252 P.2d 835, 838 (Nev. 1953).
• The Judment is REVERSED. The cause is REMANDED for entry of judgment for the NMI.
ENTERED: March 4, 1983
. The NMI also argues that the trial court erred by not fulfilling the NMI's request to take judicial notice of newspaper articles about the impending referendum. The NMI sought judicial notice to establish that the repeal of the statute was reasonably foreseeable. By demonstrating foreseeability, the Mill apparently intended to defeat MGC's asserted equitable grounds for relief. Transcript (Feb. 13,-T981) at- 3- Since we reverse on other grounds, we do not reach the judicial notice issue.
Section 21(a) of Public Law 1-14 (The Casino Gambling Act) provided in part:
Before issuing a gaming license to an applicant for his initial license under this Act, the Commission shall charge and collect from each applicant a nonrefundable application fee of TEN THOUSAND DOLLARS ($10,000.00).
Appellant's Opening Brief at 20.
Reference
- Full Case Name
- MARIANAS GENERAL CORPORATION v. GOVERNMENT OF THE NORTHERN MARIANA ISLANDS
- Status
- Published