Tort/Negligence – Duplicate Lottery Tickets – Failure to Exhaust Administrative Remedies

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Plaintiff purchased five Mega Millions lottery tickets that he later discovered included four duplicate tickets; subsequently, he filed this action in which he specifically sought damages for the purchase of winning tickets. Even though the South Carolina Education Lottery Act does not mandate exhaustion of administrative remedies, the circuit court did not abuse its discretion when it dismissed plaintiff’s claims for failure to do so.

We affirm the circuit court’s grant of defendants’ motion to dismiss.

Where an adequate administrative remedy is available to determine a question of fact, one must pursue the administrative remedy or be precluded from seeking relief in the courts.

Plaintiff argued the administrative process was only applicable to tickets that were alleged to have been produced or issued in error. Plaintiff’s argument misconstrues the South Carolina Education Lottery Act (the Act).

The Act and the South Carolina Education Lottery Commission’s (SCELC) regulations provide an administrative remedy to determine whether a prize should be paid on a lottery ticket.

S.C. Code Ann. § 59-150-230(C) provides, “[SCELC] shall promulgate regulations and adopt policies and procedures to establish a system of verifying the validity of lottery games tickets or shares claimed to win prizes and to effect payment of prizes.” Regulations 44-70(E)-(F) of the South Carolina Code of Regulations state the SCELC executive director may deny awarding a prize to a claimant if the ticket was issued or produced in error and the executive director’s decision is subject to an appeal to SCELC.

S.C. Code Ann. § 59-150-300(A) provides that any “lottery game ticket holder aggrieved by an action of the [SCELC] board may appeal that decision to the Administrative Law Court.” A final decision of the Administrative Law Court (ALC) involving SCELC must be appealed to the circuit court.

Although § 59-150-230(C)(3)(a) provides, “A prize must not be paid if it . . . arises from claimed lottery game tickets that are . . . unissued, [or] produced or issued in error,” we find the administrative procedure was applicable to all claims concerning the payment of a prize on a lottery ticket regardless of whether the claimant alleged there was an error. The determination of whether the ticket was issued or printed in error was a factual determination to be made by SCELC through the administrative process.

Furthermore, we reject plaintiff’s assertion that the circuit court accepted defendants’ claim the lottery tickets were printed in error in determining plaintiff was required to exhaust his administrative remedies. Accordingly, we hold the circuit court did not abuse its discretion in finding plaintiff was required to exhaust his administrative remedies under the Act and SCELC regulations.

Finally, the circuit court did not abuse its discretion in finding plaintiff’s failure to exhaust his administrative remedies was not excused by the futility exception. Plaintiff failed to provide any evidence showing SCELC had made any decision on his claim. Thus, plaintiff failed to satisfy his burden to show the futility exception applied.

Affirmed.

Cox v. South Carolina Education Lottery Commission (Lawyers Weekly No. 011-059-23, 10 pp.) (Jerry Vinson, J.) Appealed from Lee County Circuit Court (Kristi Curtis, J.) Joseph Clay Hopkins for appellant; William Stevens Brown, Miles Edward Coleman, Joseph Preston Strom, Bakari Sellers and Mario Anthony Pacella for respondents. South Carolina Court of Appeals