## Facts

- Harold Pearsall and Joe Alexander, friends for over 25 years, regularly bought and “shared” D.C. Lottery tickets while drinking together at Alexander’s home.
- Their routine, occurring about twice a week, included buying two tickets and treating any small winnings as money for additional tickets.
- On December 16, 1982, Pearsall bought a first “package” that included two lottery tickets; when Pearsall asked Alexander if he was “in on it,” Alexander said yes but did not pay because he claimed he had no money.
- At Alexander’s home, Alexander took the tickets from Pearsall and scratched them; both were losers.
- Later that evening, Alexander bought a second “package” himself; Pearsall took the tickets but then gave Alexander one ticket.
- Pearsall’s ticket lost; Alexander’s ticket won $20,000.
- Alexander redeemed the winning ticket and refused to share any proceeds with Pearsall.
- Pearsall sued for breach of an alleged oral agreement to share lottery winnings equally.

## Issues

1. Whether an oral agreement between friends to share proceeds from D.C. Lottery tickets is void under D.C. Code § 16-1701 as a contract arising from gaming.
2. Whether the parties formed an enforceable contract to split lottery winnings supported by consideration.

## Decision

- The trial court found an agreement to share proceeds existed but ruled it unenforceable under D.C. Code § 16-1701 and dismissed the complaint.
- The District of Columbia Court of Appeals reversed.
- The court held § 16-1701 did not apply to this co-participant lottery-sharing agreement.
- The court remanded with instructions to enter judgment for Pearsall, enforcing the agreement to share the winnings.

## Legal Principles

- A mutual promise to share lottery winnings can supply consideration because each party undertakes a legal detriment by agreeing to surrender part of any potential prize in exchange for the other’s promise.
- An agreement allocating proceeds among joint participants in a lawful government lottery is not treated as the type of gaming-related obligation invalidated by D.C. Code § 16-1701.
- A course of dealing and the parties’ words and conduct may establish mutual assent to a continuing arrangement to share jointly acquired lottery tickets and any resulting proceeds.

## Conclusion

The court enforced an oral agreement between long-time friends to split D.C. Lottery winnings, ruling that the anti-gaming statute did not void an arrangement between joint participants to divide proceeds from a lawful lottery and that the mutual promises to share winnings provided consideration.


Pearsall v. Alexander, 572 A.2d 113 (D.C. 1990)