GAUNT v. UNITED STATES
No. 4479
United States Court of Appeals First Circuit
July 28, 1950
Rehearing Denied Sept. 18, 1950
Writ of Certiorari Denied Jan. 8, 1951. See 71 S.Ct. 350.
But the right of every American to equal treatment before the law is wrapped up in the same constitutional bundle with those of these Communists. If in anger or disgust with these defendants we throw out the bundle, we also cast aside protection for the liberties of more worthy critics who may be in opposition to the government of some future day.
If, however, I were to be wrong on all of these abstract or theoretical matters of principle, there is a very practical aspect of this application which must not be overlooked or underestimated that is the disastrous effect on the reputation of American justice if I should now send these men to jail and the full Court later decide that their conviction is invalid. All experience with litigation teaches that existence of a substantial question about a conviction implies a more than negligible risk of reversal. Indeed this experience lies back of our rule permitting and practice of allowing bail where such questions exist, to avoid the hazard of unjustifiably imprisoning persons with consequent reproach to our system of justice. If that is prudent judicial practice in the ordinary case, how much more important to avoid every chance of handing to the Communist world such an ideological weapon as it would have if this country should imprison this handful of Communist leaders on a conviction that our own highest Court would confess to be illegal. Risks, of course, are involved in either granting or refusing bail. I am not naive enough to underestimate the trouble-making propensities of the defendants. But, with the Department of Justice alert to the dangers, the worst they can accomplish in the short time it will take to end the litigation is preferable to the possibility of national embarrassment from a celebrated case of unjustified imprisonment of Communist leaders. Under no circumstances must we permit their symbolization of an evil force in the world to be hallowed and glorified by any semblance of martyrdom. The way to avoid that risk is not to jail these men until it is finally decided that they should stay jailed.
Their bail as fixed by the Court of Appeals is therefore continued until the Supreme Court of the United States shall deny their petition for certiorari or, if it be granted, shall render judgment upon their cause.
Fred G. Folsom, Special Assistant to the Attorney General (Theron Lamar Caudle, Assistant Attorney General, Ellis W. Slack, Special Assistant to the Attorney General, George F. Garrity, United States Attorney, and Philip T. Jones, Assistant U. S. Attorney, both of Boston, Mass., with him on the brief), for appellee.
Before MAGRUDER, Chief Judge, and CLARK and WOODBURY, Circuit Judges.
WOODBURY, Circuit Judge.
The defendant-appellant was indicted in six counts for alleged offenses with respect to his federal income taxes for the calendar years 1944, 1945, and 1946, during which period he was on the cash-calendar year basis and filed joint returns with his wife. In counts 1, 2, and 3 it was charged that he “did wilfully and knowingly attempt to defeat and evade a large part of the income tax due and owing by him and his wife to the United States of America” for each of the above calendar years, respectively, “by filing and causing to be filed with the Collector of Internal Revenue for the Internal Revenue Collection District of Massachusetts, at Boston, Massachusetts, a false and
A trial by jury on pleas of not guilty as to each of the four counts above described resulted in a verdict of not guilty on the first count, but verdicts of guilty on counts 2, 3, and 5. The court below thereupon sentenced the defendant to concurrent terms of imprisonment for 18 months on each of those three counts, and also sentenced him to separate fines of $2,000 on each, and this appeal is from the judgment and commitment embodying those sentences.
The defendant first attacks the sufficiency of the indictment as to counts 2 and 3 on the ground that “The mere making and subscribing of a false return, even though done willfully and with an intent to evade or defeat the tax, is not an ‘attempt’ to evade or defeat the tax under
In the Spies case it was held that mere proof of a wilful failure to file any return at all, coupled with failure to pay any tax, will not support a conviction for the felony described in
The defendant‘s argument is that in the case at bar the Government has proved at the most that he wilfully made and subscribed a tax return which he did not believe to be true and correct as to every material matter, and hence proved only the offense described in
The defendant‘s argument rests upon the fallacious premise that an indictment under
Section 35(A) of the old Criminal Code,
We concede the force of the contention, as did the court below. We incline to the view, however, that the court below was correct in its conclusion that the contention is ruled against the defendant in United States v. Gilliland, 312 U.S. 86, 61 S.Ct. 518, 85 L.Ed. 598. See also Bartlett v. United States, 10 Cir., 166 F.2d 920, 927; United States v. Heine, 2 Cir., 149 F.2d 485, 487, certiorari denied 325 U.S. 885, 65 S.Ct. 1578, 89 L.Ed. 2000, and Ex parte Berkoff, D.C., 65 F.Supp. 976. But however this may be, the point is now moot for it is authoritatively established that a conviction may be sustained on the basis of a statute other than that cited in the indictment, if the error in citation did not mislead the defendant to his prejudice, Williams v. United States, 168 U.S. 382, 389, 18 S.Ct. 92, 42 L.Ed. 509; United States v. Hutcheson, 312 U.S. 219, 229, 61 S.Ct. 463, 85 L. Ed. 788; Rule 7(c) of the Federal Rules of Criminal Procedure,
But the defendant contends that counts 3 and 5 allege one and the same offense, and for that reason his motion to require the Government to elect between them should have been granted. What we have already said with respect to the difference in the scope of
We turn now to the defendant‘s contention that “The evidence did not prove beyond a reasonable doubt that the defendant acted ‘wilfully‘, and the Court erred in refusing to give requested instructions as to the meaning of the term.”
The defendant rests the first part of this contention on the broad proposition that “wilfulness within the meaning of any of the statutes in question cannot be inferred merely from proof of understatement of income on the defendant‘s tax returns,” and that “such proof was the only proof offered by the Government in the course of its case.” At the outset it must be pointed out that the defendant by offering evidence on his own behalf elected to abandon his motion for acquittal made at the close of the Government‘s case and to rely upon a subsequent motion to the same effect made at the close of all the evidence, United States v. Goldstein, 2 Cir., 168 F.2d 666, 669, 670; Mosca v. United States, 9 Cir., 174 F.2d 448, 450, 451 and cases cited3 which he made, so that this later motion is the only one for consideration on this appeal. Hence the sufficiency of the evidence as a whole to establish the defendant‘s wilfulness must be considered, not merely the sufficiency of the evidence offered by the Government alone on that issue. And an examination of all the evidence convinces us of its sufficiency with respect to the defendant‘s wilfulness.
Wilfulness is, of course, a question of fact. But direct proof thereof is not essential. It may be inferred from acts and circumstances, and the inference may be drawn from a combination of acts and circumstances, although each separate act and circumstance standing alone is inconclusive. Battjes v. United States, 6 Cir., 172 F.2d 1, 5. Moreover, in cases of this sort “affirmative willful attempt may be inferred from * * * any conduct, the likely effect of which would be to mislead or to conceal.” Spies v. United States, supra, 317 U.S. 499, 63 S.Ct. 368. Thus mere understatements of income by the defendant are not by any means the sole criterion for determining the wilfulness of his alleged attempts to evade or defeat his taxes. His understatements of income must be viewed in their setting, and so viewed we are convinced that the jury could well find that the understatements were wilful, for if the jury accepted
And the trial court‘s instructions on the issue of wilfulness were clear and adequate. Without going into a detailed analysis of each of the defendant‘s requested instructions on this issue which the court below denied, it will suffice to say that an examination of the evidence and the charge discloses that such of those requests as were not given in substance were either erroneous or misleading, or if given would have unduly burdened the charge with unnecessary and confusing detail. The charge as given seems to us accurate and adequate, and eminently fair to the defendant on the issue of wilfulness as the excerpt therefrom in the margin indicates.4
The defendant also complains of the charge in that the trial court refused his requests to instruct the jury as to the law with respect to the taxability of income received by the defendant as the result of several business transactions entered into by the defendant during the years involved, which income the Government contends he grossly understated in his returns—his theory being that “In order for the jury to conclude with respect to any transaction that the defendant did what he did with a fraudulent purpose to defeat and evade his tax, it would be essential for the jury first to find that in his treatment of the transaction he did defeat and evade the tax.”
A careful examination of the record discloses no basis for the conclusion that the defendant reported any one of the business transactions in question in compliance with the applicable tax law or Treasury Regulations. Indeed his defense at the trial was not to deny that he had illegally understated his taxable net income from those transactions, but that his understatements with respect thereto were not wilful, but were the result of carelessness, stubborness, or negligence, and that certain other misstatements in his returns as to minor matters, although technically erroneous, did not in fact result in an understatement of his taxable net income. The Government‘s evidence, on the other hand, tended clearly to disprove all this. The issue at the trial, and as we read the record the only issue there, was whether the understatements were made wilfully or innocently, not whether the returns complied with the applicable law and regulations, and from this it follows that there was no occasion to burden the charge, and undoubtedly confuse the jury, with a discussion, which could only be complicated, of several intricate aspects of income tax law.
This brings us to the defendant‘s last contention which is that the court below abused its discretion in denying his motion for a new trial. We deem it necessary to discuss only two of the grounds advanced in support of this motion.
Counsel for the defendant in the course of his argument to the jury called attention to the fact that the defendant had been elected to the Governor‘s Council in November 1946, that his term of office began in January 1947, that investigation of his income tax returns for the years involved began in February 1947, that at no time had he been sent a thirty day letter, a ninety day letter, or been given by the Government “an opportunity to pay what he owed” and then asked rhetorically: “Is it possible, Mr. Foreman and Gentlemen, that the Government, the Internal Revenue Bureau, the agents, jumped in with alacrity upon him as a Governor‘s Councillor?” Subsequently, no doubt moved by these remarks, the court below said in its charge: “I am very sorry that there was an issue of politics raised in this case. No man in this courtroom, I am sure, is interested in considering political questions with respect to this case. You are not here as Republicans or Democrats or Socialists, and I have no reason to believe that anyone else is here in a partisan capacity. A man is here to be judged on the basis of his tax record, not his political record. And I have no reason to suppose that the Grand Jury differed one bit from you gentlemen in acting according to their consciences and their views of justice. A man who is or has been a member of the Governor‘s Council is entitled to just as good a break as a man who has not been, and he is not entitled to one bit better break.”
Counsel for the defendant contends that the above portion of his argument constituted “a legitimate comment upon evidence in the case” and that although the trial court “was entitled to comment on the evidence“, it was not entitled to take from the jury “the right to consider any inference based on evidence, however slight, of an attempt to use the criminal law against a citizen for political purposes.” Indeed, he says that the action of the court in so doing was so highly prejudicial as to warrant a new trial, not as a matter of discretion, but as a matter of law. We cannot agree. In fact we think the court below correctly refused to permit a charge so serious as that government officials were actuated by political motives in matters of this sort to rest upon so slight a foundation. Furthermore, the proper issue before the jury was the guilt or innocence of the defendant on the evidence presented; and pure speculation as to motivation of the prosecuting officials introduced an extraneous issue of the red herring variety. Certainly we cannot say that the court below abused its discretion in doing what it did. Nor do we need to pause for long over the defendant‘s further contention that the sentence in the above quoted portion of the charge with respect to the Grand Jury constituted highly prejudicial error in that it permitted the jury to give “weight to the action of the Grand Jury which it was not entitled to have.” It will suffice to say that the court‘s passing comment with respect to lack of reason to suppose any impropriety on the part of the Grand Jury was warranted under the circumstances, and that misinterpretation of that remark by the jury can hardly be supposed in view of the court‘s instruction at the outset of its charge that the indictment “is not evidence in the case“, but “a mere charge or presentment which was made by the Grand Jury after hearing only one side of the case. Moreover, the Grand Jury may or may not have heard some of the same evidence which you heard.”
Finally the defendant contends that a grave enough error to warrant a new trial as a matter of law occurred when the prosecutor toward the end of the trial asked a defense character witness: “Did you also hear that the defendant was convicted for violation of the labor laws in—.” Concededly the question was cut short as indicated
We agree with the court below that the question was properly cut short and excluded. The controlling cases, Michelson v. United States, 335 U.S. 469, 69 S.Ct. 213, 93 L.Ed. 168, and Malatkofski v. United States, 1 Cir., 179 F.2d 905, do not go further than somewhat unenthusiastically to permit in discretion questions of the kind under consideration with respect to offenses involving moral turpitude or dereliction of some sort, such as conspiracy to steal, or receiving stolen goods, respectively, whereas the broad general question in the present case with respect to some unspecified violation of the labor laws has no more direct tendency to show moral turpitude or dereliction than a broad general question with respect, for instance, to some unspecified violation of the motor vehicle laws. And it is more prejudicial. In short, discretion exists as to questions with respect to offenses from which defective moral character may be inferred, but does not exist as to questions with respect to offenses from which no such inference is permissible. Questions of the latter sort probe not only irrelevant but also prejudicial matter which must be excluded as a matter of law. But we are not by any means prepared to say that the question asked was so highly prejudicial as to warrant us in ordering another trial as a matter of law. The court below was in a far better position than we to judge the prejudicial effect of the question upon the jury, and the adequacy of the corrective measure taken. We cannot say that that corrective measure was so hopelessly inadequate as to warrant the conclusion that the trial court abused its discretion in refusing to grant a new trial on that score.
The judgment of the District Court is modified by striking therefrom that part imposing a fine of $2,000 on count 5, and by changing the total of fines from $6,000 to $4,000, and as modified said judgment is affirmed.
MAGRUDER, Chief Judge (concurring).
I concur in the judgment and in general in the opinion of the Court.
With reference to the question which the prosecutor asked of a defense character witness, “Did you also hear that the defendant was convicted for violation of the labor laws in—“: This type of question may be permissible in the discretion of the trial judge, provided the proper factual basis for it exists. Malatkofski v. United States, 1 Cir., 1950, 179 F.2d 905, 913, 914; Michelson v. United States, 1948, 335 U.S. 469, 69 S.Ct. 213, 93 L.Ed. 168. Here the judge excluded the question at the outset and directed the jury to disregard it. Counsel for the defendant did not ask for a mistrial at that point. After the jury brought in its verdict, the defendant moved for a new trial for the reason, among others, that he had been substantially prejudiced and deprived of a fair trial as a result of the action of the prosecutor in asking the character witness the foregoing question. The reasons given by the judge for denying a new trial on that score seem to me to be adequate. Defendant was not entitled to a new trial as a matter of law, and it seems to me obvious that the trial court cannot be said to have committed an abuse of discretion in denying the motion. See Sears v. United States, 1 Cir., 1920, 264 F. 257, 264.
The effect of what we do is that the defendant will have to serve concurrent sentences of 18 months and pay aggregate fines of $4,000. I think the conviction on count 5 is clearly invulnerable, for the reasons indicated in the Court‘s opinion. Therefore, though I agree that the convictions on counts 2 and 3 should also be affirmed, it may be worth while to point out that even if we had concluded that the defendant had been improperly convicted on those two counts, all we would have done would have been to set aside the judgment of conviction and the sentences as applied to counts 2