Kaufman v. United States

212 F. 613 | 2d Cir. | 1914

ROGERS, Circuit Judge

(after stating the facts as above). The plaintiff in error who was the defendant below has been convicted of. the crime of having aided and abetted the Daisy Shirt Company in concealing its assets in violation of section 29b' of the Bankruptcy Act. He was not charged with having concealed the assets of the company from the trustee in bankruptcy. The indictment charged the Daisy Shirt Company with having concealed its assets from its duly qualified trustee in bankruptcy to an amount exceeding $5,000, and further charged that the defendant “under the circumstances aforesaid did knowingly and fraudulently cause, procure, aid and abet, the Daisy Shirt Company while the said Daisy Shirt Company was a bankrupt as aforesaid, knowingly and fraudulently to conceal in the manner and form' aforesaid, from William P. Myhan, the duly qualified trustee in bankruptcy of the said Daisy Shirt Company, the aforesaid sums of money and the aforesaid property belonging to the estate in bankruptcy of' the said Daisy Shirt Company.”

The provision of section 29b of the Bankruptcy Act reads as follows :

“A person shall be punished, by imprisonment for a period not to exceed two years, upon conviction of the offense of having knowingly and fraudulently concealed while a bankrupt, or after his discharge, from his trustee any of the property belonging to his estate in bankruptcy.”

The Criminal Code in section 332 provides .that:

“Whoever directly commits any act constituting an offense defined in any law of the United States, or aids, abets, counsels, commands, induces, or procures its commission, is a principal.”

The federal courts have such criminal jurisdiction only as is given by act of Congress. Jones v. United States, 137 U. S. 202-211, 11 Sup. Ct. 80, 34 L. Ed. 691. The .defendant was indicted as a principal under section 332 of the Criminal Code, and the case was tried on that theory.

[1, 2] The offense of concealing the assets from the trustee in bankruptcy is a felony as one committing the offense may be punished by imprisonment for more than one year. Section 335 of the Penal Laws, Act March 4, 1909. In the case of felonies the common law recognized,, the distinction of principals and accessories, a distinction it refused to apply to persons participating in treason and in misdemeanors. In the case of treason and misdemeanors all persons who were guilty at all were punishable as principals and indictable as such. In the case of felonies one who aided and abetted the principal, but was absent when the crime was committed, or who after the crime was committed assisted the perpetrator, was simply an accessory. And according to the common law an accessory could not be tried before the conviction of the principal. But under section 332 of the Criminal Code of the United States all abettors of any crime are made principals. It is not necessary, therefore, that a bankrupt corporation should first be convicted before bringing to trial one charged with aiding and abetting in the concealment of its assets from a trustee in bankruptcy.

[3] It is undoubtedly the case that decisions and dicta can be found denying that a corporation can be indicted. Lord Holt is reported as having said that “a corporation is not indictable, but the particular members of it are.” Anonymous, 12 Mod. 559. But it is a well-established principle of modern jurisprudence that an indictment will lie against a corporation, although there are some crimes, as treason, or felony, or breach of the peace, in respect of which it is agreed that an indictment could not be maintained against it, and it has been held that where a statute prescribes fine and imprisonment it is not applicable to a corporation because a corporation cannot be imprisoned. United States v. Braun & Fitts (D. C.) 158 Fed. 456. But in Cohen v. United States, 157 Fed. 651, 85 C. C. A. 113 (1907), this court decided that a bankrupt corporation was capable of committing the criminal offense of knowingly or fraudulently concealing its property from its trustee defined and made punishable by the Bankruptcy Act, and that persons who conspire to cause a corporation to commit such an offense are indictable for the conspiracy, and that it is immaterial that the corporation is not or cannot be indicted as one of the conspirators. We know of no reason why we should not adhere to the opinion we then expressed. We are compelled therefore to disregard the defendant’s contention that," if the corporation could not be convicted of the offense described in section 29b of the Bankruptcy Act, he could not be convicted of aiding and abetting in the commission of such an offense. There is no distinction in principle between the Cohen Case, supra, and the case at bar. The fact that in the Cohen Case the indictment was for conspiracy under section 5440 of the Revised Statutes, while in this case the indictment is based on a concealment of assets, is a distinction without a difference so far as the principle involved is concerned.

[4] It may be conceded that defendant could not be convicted under section 29b of the Bankruptcy Act. That section applies only to one who has “knowingly or fraudulently concealed while a bankrupt or after his discharge.” As the defendant is not alleged ever to have been a bankrupt the section is without application to him. It was held in Field v. United States, 137 Fed. 6, 69 C. C. A. 568, that the present or past bankruptcy of the person accused was an indispensable element of the offense created by that section. The defendant, however, is mistaken in supposing that the principle announced in the Field Case is so far applicable to his case as to require this court to set aside his conviction. He loses sight of the fact that his own conviction is not under section 29b of the Bankruptcy Act which was under discussion in the Field Case, but is under section 332 of the Criminal Code.

[5] The offense with which the defendant is charged is that he aided and abetted the Daisy Shirt Company while the said company was a bankrupt knowingly and fraudulently to conceal from the duly qualified trustee property belonging to the estate in bankruptcy. The concealment must be a concealment from the trustee. In re Adams (D. C.) 171 Fed. 599. In the case at bar the funds were taken and the concealment began before the appointment of the trustee. But if the concealment which began before the appointment of the trustee continued after the appointment was made, and there was evidence in this case showing that it did, it constituted concealment from him. This we decided in the Cohen Case, supra.

[6] The defendant took the stand and testified in his own behalf. It is urged upon us that error was committed at the trial in the admission of certain evidence. The defendant’s attorney was permitted to say:

“I was retained by Mr. Kaufman (the defendant) as attorney for the Daisy Shirt Company, and also to represent Mm individually.”

It was objected that this evidence was calculated to bias or prejudice the defendant in the eyes of the jury. We see no valid objection to the admission of the testimony. If the attorney was retained by the defendant to represent him personally in the bankruptcy proceedings, the fact cannot be regarded as privileged. It was necessary for the witness to give this testimony before he could claim his privilege as to communications which passed between him and the attorney about which he was asked and which were excluded upon the theory that they were privileged.' Whether any. error was committed in refusing to allow the communications which may have passed between the defendant and his counsel in respect to the commission of a crime or a fraud, the legal adviser being ignorant of the purpose for which the advice was wanted, is not before us. 'But it may be remarked in passing that it has been held in England that a communication made in furtherance of any criminal or fraudulent purpose is not privileged. Queen v. Cox, 14 Q. B. II, 153. And the English rule appears to have been regarded with favor in the Supreme Court of the United States in Alexander v. United States, 138 U. S. 353, 11 Sup. Ct. 350, 34 L. Ed. 954, the rule being limited to cases where the party is tried for the crime in furtherance of which the communication was made, although the attorney declared in the case at bar that he had been retained by the defendant, the defendant while on the stand positively denied that he had been so retained. In view of his testimony on that point, we fail'to see what right he has .to raise the question of privilege at all. He cannot blow hot and cold at the same time. But irrespective of his right to raise the question, there is nothing in the point which he seeks to make.

[7] The defendant predicates error upon a refusal to charge “that if upon the whole case the jury should find that the evidence is evenly balanced, or that they are unable to determine where the truth lies, then that would create a reasonable doubt, and the defendant is entitled to an acquittal.” The charge was a full, clear, explicit, and fair one, covering all the aspects of the case. The instructions upon the law were sufficiently distinct and precise. On the subject of reasonable doubt the jury was charged as follows:

“Now, in tins, as in all other criminal cases, all of the facts must be proved against the defendant beyond a reasonable doubt, which is, as Mr. McIntyre (the defendant’s counsel) told you. That does not mean that you should look around to see what remote or unreasonable theory you can imagine that might throw it out. If every suggestion which is not obviously fictitious is excluded from your mind, so that your minds are settled that the man is guilty, then you bring a verdict against him. It is only in case you shall have some doubt, for which you can give a sensible reason, that you are to bring in a verdict of guilty.”

What Mr. McIntyre had told the jury about “reasonable doubt” does not appear in the record. If he thought that what he said to the jury on th'e subject, which the court adopted and supplemented, was not adequate, he should have had what he said on that subject incorporated into the record for our information. The accused was entitled to have the jury instructed that the prosecution must prove the charge against him beyond a reasonable doubt. Some courts have declared that it is not necessary for the trial judge to define or explain the words “reasonable doubt.” State v. Davis, 48 Kan. 1, 28 Pac. 1092; State v. Reed, 62 Me. 129; State v. Robinson, 117 Mo. 649, 23 S. W. 1066. The Supreme Court of the United States, in Miles v. United States, 103 U. S. 304, 312 (26 L. Ed. 481), said "Attempts to explain the term ‘reasonable doubt’ do not usually result in making it any clearer to the minds of the jury.” And the same court, speaking through Mr. Justice Brewer, in Dunbar v. United States, 156 U. S. 185, 199, 15 Sup. Ct. 325, 39 L. Ed. 390 (1894), referred approvingly to what was said in the Miles Case. We are not now expressing any opinion upon whether the trial .judge is or is not bound to define a reasonable doubt. But we fail to discover after what had already been said upon the subject any reason why the court should have enlarged upon it by complying with the request of counsel to charge in the words requested. The subject had already been adequately covered.

[8] There was no evidence that Kaufman was holding the moneys under an agreement with the bankrupt to do with them what it asked. Of course, if there had been such evidence, it would have been important in establishing the guilt of the defendant. But the absence of such evidence does not impair the government’s case, for it is not át all important whether the defendant in taking and concealing the assets was concealing them on behalf of the bankrupt or for himself. The offense consists in concealing from the trustee any of the property belonging to the bankrupt. What may be the purpose of the concealment and who is to benefit by it does not enter into the matter. The wrong that is being punished is the withholding from the trustee, and therefore from the creditors, property to which they are entitled.

[9] There is no error of law and the evidence abundantly supports the verdict of the jury. The jury hás found under instructions of the court that the assets were' secreted under a general scheme and that the defendant aided and abetted the bankrupt corporation in the concealment of its assets from its trustee in bankruptcy. The defendant admitted he had taken the moneys and that he had never turned over a dollar to the trustee. His claim that he paid $400 to one Kuntz on a debt due to the latter from the corporation was denied by Kuntz. Neither his wife, nor his mother-in-law nor his brother were called to corroborate him in the story he told as to payments made to them in payment of debts due to them likewise from the corporation. His sister took the stand to corroborate him as to payments made to her by him, but her testimony was properly characterized by the trial judge as extraordinary and was evidently not believed by the jury. As soon as he obtained the money of the bankrupt, he left the United States without jinforming any one where he was going. He did not even wait to surrender the lease to his apartment or to look after the storage of his furniture. He never communicated with the trustee, nor did he in any way assist in straightening out the affairs of the bankrupt corporation of which he was president and general manager. The case is a particularly flagrant one, and the majority of the court discover no reason for reversing the judgment.

Judgment affirmed.