## Facts

- Two licensed card clubs in Gardena provided card games for money and charged players time-based table rental fees tied to betting limits.
- The clubs offered check-cashing privileges to patrons, primarily to fund gambling.
- Robert H. Wynn’s wife was a compulsive gambler known to the clubs and had check-cashing privileges there.
- In late 1973, she incurred heavy gambling losses and cashed $1,750 in checks at the clubs that were returned for insufficient funds.
- It was conceded her gambling debts were not chargeable to the spouses’ community property.
- Wynn contacted a general partner of the clubs and alleged an agreement: Wynn would pay the $1,750 in exchange for the clubs’ promise to deny his wife access and deny further check-cashing privileges.
- A letter from the partner confirmed the amount and nature of the wife’s dishonored checks; Wynn paid the $1,750 the next year.
- By about 1977, Wynn discovered his wife had again been allowed to gamble and cash checks at the clubs, allegedly resulting in about $30,000 in losses, additional borrowing, and eventual divorce proceedings.
- Wynn sued for breach of contract, fraud, and negligence, seeking consequential damages including emotional distress tied to marital breakdown.
- The trial court granted summary judgment for defendants on condition they refund $1,750 plus interest; Wynn appealed.

## Issues

1. Whether the alleged agreement to bar Wynn’s wife and deny check-cashing privileges, supported by Wynn’s payment of $1,750, was void or unenforceable as illegal or against public policy due to its gambling context.
2. Whether consequential damages, including claimed emotional distress and marital harms, were categorically unrecoverable as a matter of law on the alleged breach.
3. Whether summary judgment was proper given disputed facts about contract formation, scope, breach, causation, and damages.

## Decision

- The Court of Appeal reversed the summary judgment and remanded.
- The court held the alleged agreement was not void as an illegal gambling contract as a matter of law and could be viewed as collateral to gambling and intended to restrain it.
- The court concluded triable issues existed regarding the existence and terms of the agreement, including whether the letter and Wynn’s account established a bargained-for promise to exclude his wife and deny check-cashing.
- The court held it could not determine on summary judgment that all claimed damages beyond return of $1,750 were unrecoverable; foreseeability and causation presented factual questions.

## Legal Principles

- A contract connected to a gambling setting is not automatically void; an agreement that aims to restrict gambling and protect against foreseeable harm may be enforceable if not clearly contrary to public policy.
- On summary judgment, courts may not resolve credibility disputes or interpret ambiguous evidence in a way that forecloses reasonable inferences supporting the nonmoving party’s theory of contract formation and scope.
- Consequential damages for breach of contract turn on foreseeability, causation, and remoteness; in sensitive contexts, substantial personal and financial consequences are not categorically barred as a matter of law, though they remain subject to proof and limitation at trial.
- Summary judgment is improper where material factual disputes exist on contract terms, breach, and the nature and extent of compensable damages.

## Conclusion

The appellate court reversed summary judgment because the alleged bargain to pay prior dishonored gambling-related checks in exchange for barring a known compulsive gambler was not illegal as a matter of law, and disputes over contract terms, breach, and foreseeable consequential damages required trial-level factfinding.


Wynn v. Monterey Club, 111 Cal. App. 3d 789, 168 Cal. Rptr. 789 (Cal. Ct. App. 1980)