138 Wis. 354 | Wis. | 1909
I knew tbe defendant well. He bad been for many years engaged in business at Milwaukee, respected, honored with confidential business patronage and with important public offices. He bad reached tbe age of fifty-eight years and bad children and grandchildren. I know of no sadder story than tbat of such a man in tbe afternoon of a well-spent life, under tbe pressure of unexpected business calamities and yielding to tbe delusions of hope, being tempted to lay bis bands unlawfully upon tbe moneys of others intrusted to bis keeping. I regret bis misfortunes and sympathize with him in bis misery, but neither regret nor sympathy can be allowed to swerve tbe mind from a consideration of tbe case according to law and tbe evidence.
Tbe defendant, together with Edward J. Wagner and H. O. Roethlisberger, were copartners carrying on a real estate and
There was evidence from which the jury might infer that this money was delivered by Kafura to Wagner in the presence of the defendant and Wagner put it in the corporation safe. The account carried as “Conrad Mizer Estate” was credited on the books of the corporation with the money so paid. The money in question was put into the cash drawer in the safe and mingled with other moneys received by the corporation that day. The corporation had the use of the money, and it was deposited in the bank afterward to the general account of the corporation. The corporation continued to pay interest to Mrs. Mizer as if the loan was still outstanding for the purpose of concealing the fact from her that the principal of $300 had been paid by Kafura, and the defendant was aware of this. This was the way the corporation handled the moneys received from various clients for the purpose of loaning the same upon security. It never kept such money separate. At the time this money was received from Kafura the liabilities of the corporation largely exceeded its assets, and that condition continued down to the bankruptcy. At this time the defendant had overdrawn his account with the corporation to the amount of $31,000, Wagner had overdrawn to the amount of $10,000, the stock subscription of the defendant was $24,000 and that of Wagner $6,000, and this overdraft continued increasing up to the time of the bankruptcy. The money in question was delivered to the copart-nership in the first instance for the purpose of investing the same upon security, and no other authority was ever given, and the corporation, so far as it could do so by action of its officers and stockholders, succeeded to the duties and liabilities of the precedent copartnership with respect to Mrs. Mizer.
The first twenty-one errors assigned by the defendant have relation to the question whether or not he could be convicted
Tbe errors assigned in the admission of evidence challenge the correctness of rulings admitting the articles of incorporation, subscription agreement, and other corporate papers, evidence concerning who bad direction and control of tbe corporation, tbe meetings of the stockholders and directors, and who were tbe stockholders. Also entries in the corporate books of account, including among other accounts tbe account of tbe defendant and that of Wagner and that of Helena Mi-zer, and tbe condition of such accounts and tbe records and files of tbe bankruptcy court relating to tbe bankruptcy of this corporation, and all tbe evidence tending to show transactions between Helena Mizer and tbe corporation.
Another class of errors assigned relate to evidence concerning other mortgages belonging to Helena Mizer in tbe ¡possession or under tbe control of tbe corporation and tbe time of payment thereof, and evidence of payment of money to tbe corporation on account of other clients and on account of similar loans, which payments wore not remitted by tbe corporation to tbe owners or accounted for to them, and with reference to tbe ability of tbe corporation to repay tbe moneys that had been paid to it between April 27, 1903, and tbe time of its bankruptcy.
It will readily be seen that all these errors are assigned upon tbe theory that this corporation intervened between tbe principal and tbe loan agents after tbe relation of principal and agent bad been created as an independent responsible personality, which by reason of its intervention i» some extent changed tbe relations theretofore existing between tbe defendant and tbe Mizer estate, and itself received and converted tbe
It is further contended that tbe evidence is insufficient to' support tbe verdict of conviction, in that tbe receipt of the $300 by tbe defendant personally is not shown, and, further, that tbe information charged a conversion, not to tbe use of tbe corporation, but to tbe use of tbe persons who were its officers, including tbe defendant. From what has been said it must be apparent that there was sufficient evidence of tbe relation of principal and agent between Conrad Miser and his-successor in interest, Helena Mizer, and tbe copartnership of C. W. Milbrath & Co. in the first instance. Tbe defendant knew of tbe payment of tbe loan by Kafura, and executed personally as attorney in fact for Groth at tbe time a release of tbe mortgage in question. Tbe money was paid over in his presence and be knew that it did not belong to him. Tbe evidence is ample to support tbe contention that it was put in tbe corporation safe and mingled with tbe funds of tbe insolvent corporation and deposited in its bank account with the-consent and by tbe act of tbe defendant conjointly with Wagner. He must be held to have known of tbe insolvent condition of the corporation at tbe time and that such disposal of tbe money would have substantially the same effect as throwing it into tbe fire. He made no attempt to reinvest the-money, but, on tbe other band, concealed from bis principal' tbe fact that tbe money bad been collected and in this manner disposed of by him by continuing to pay from tbe corporate-funds interest upon this loan to bis principal as if tbe loan were still outstanding and unpaid. There cannot be much doubt that this constituted a conversion of tbe money by the defendant and Wagner. But was tbe money converted to-their own use? One may convert money of another to bis own use by paying it out upon bis private or personal debt. Guenther v. State, 137 Wis. 183, 118 N. W. 640. If this is true, be can convert tbe money to bis own use by putting it
In Haynes v. Kenosha E. R. Co. 139 Wis. 227, 119 N. W. 568, where one person owned the majority of tbe shares-of stock in each of three corporations, in each of wbicb be was-tbe principal managing officer and in each of wbicb be controlled tbe board of directors, and these corporations through sucb person made certain corporate contracts between themselves, this court, speaking of tbe corporations, said:
“When be ‘met’ with himself, they met if be so willed. His unhampered authority to dictate was questioned by no-one. He was simply dealing with bis own property through a corporate agency as absolutely as be might deal with it as an individual. We must look to bis intent to some extent to-determine just wbicb corporate entity owned tbe property we-are dealing with.”
In Pott v. Schmucker, 84 Md. 535, 36 Atl. 592, 57 Am. St. Rep. 415, where one of tbe partners of an insolvent firm-owning a separate business procured a charter of incorporation, turned over all tbe assets of the separate business to this-corporation and took all its shares of stock except certain quali
In Hoffman S. C. Co. v. Cumberland C. & I. Co. 16 Md. 456, the question of independent and separate corporate personality was also disregarded. Conversely, acts of the shareholder's and trustees attempted to be performed in their personal or individual capacity may as to the state be acts of the corporation, as in People v. North River S. R. Co. 121 N. Y. 582, 24 N. E. 834, where it was said:
“The abstract idea of a corporation, the legal entity, the impalpable and intangible creation of human thought, is itself a fiction, and has been appropriately described as a figure of speech. It serves very well to designate in our minds the collective action and agency of many individuals as permitted by the law, and the substantial inquiry always is what in a given case has been that collective action and agency. As between the corporation and those with whom it deals the manner of its exercise usually is material, but as between it and the state the substantial inquiry is only what that collective action and agency has done, what it has, in fact, accomplished, what is seen to be its effective work, what has been its conduct.”
In State ex rel. v. Standard O. Co. 49 Ohio St. 137, 30 N. E. 279, 15 L. R. A. 145, it was said that the legal fiction that a corporation is a person can never be urged to an intent and purpose not within the reason and policy of that fiction. Oases not within .the reason and policy of that fiction must necessarily be rare, and no general rule that we are aware of has been in that respect formulated. But it is safe to say that in a criminal prosecution against a person charged with an offense committed by him against the laws of the state he could not be heard to say in justification that he committed that offense in his official capacity as officer of a corporation; nor
We must regard these assignments of error as if tbe defendant and Wagner were both on trial.
Tbe foregoing considerations dispose of, adversely to tbe defendant, tbe contention that it was erroneous to charge tbe jury as follows:
“Further, it is undisputed that Helena Mizer was not informed, either by tbe defendant or Wagner, of tbe payment of tbe money by Kafura, but that from time to time thereafter for a period of two years or more she was paid interest thereon by tbe defendant, Charles W. Milbrath."
It is claimed that these payments were made to her by tbe corporation acting tbrougb its officers, but under tbe circumstances above detailed it was not incorrect to say that these interest payments were made by tbe defendant. So it was not error for tbe court to charge tbe jury:
“But the question for you to decide is: Did the defendant, Charles W. Milbrath, unlawfully and feloniously embezzle and fraudulently convert to bis own use or to tbe use of some other person than tbe owner $300 or some part thereof of tbe money of Helena Mizer without her consent when C. W. Milbrath and E. J. Wagner were acting as her servants, agents, and employees, under tbe testimony and circumstances shown by tbe testimony.”
Nor was it error to inform tbe jury that this $300 was not tbe money of C. W. Milbrath & Co., but was tbe money of Helena Mizer, because tbe evidence on that point is without substantial contradiction. There was no error in instructing tbe jury, with respect to tbe defendant and Wagner and concerning tbe $300 in question, “that they and each of them held it in trust for her,” meaning Helena Mizer. Nor was
It is further contended that the court erred in instructing the jury as follows: “It is not disputed that Helena Mizer lost her money by fraud.” The accused, Wagner, who became a witness for the state, who had charge of this transaction with the defendant and co-operated with him in the control and management of the corporation, testified without contradiction that the receipt of this money by the corporation from Kafura was concealed from Helena Mizer by himself and the defendant, and interest paid to her semi-annually as if the loan were still outstanding, for the purpose of giving her the impression that her money had not been collected and was not in their hands. It can scarcely be claimed that this was not fraud, and if this fraud was not the sole cause of the loss of her money it must have contributed very materially to that result, because the object of the concealment was to prevent her from drawing out this money or demanding it, and it is reasonably probable that, had she done so within the first year after the receipt of the money by the- corporation, it would have been paid over. This portion of the charge is not approved. But, in view of the uncontradicted evidence on this point, it cannot be said to have been prejudicial to the defendant.
The first request to charge which is called to our attention is substantially to the effect that it would not be sufficient to show that the money in question was converted by the defendant to the use of the corporation, and the same is true of the
The second request forming the thirty-first assignment of ■error we think related to matters sufficiently covered by the general charge, and the same is true of the request to charge forming the thirty-fourth assignment of error. The charge ■of the court, among other things, contained the following:
“You are to say and find from the evidence and circumstances surrounding the alleged commission of the offense whether the defendant did fraudulently convert the money of Helena Mizer to his own use, not merely that the money was ■converted, but that it was fraudulently converted. This must •appear to your satisfaction beyond a reasonable doubt. . . . If you find the conversion and find that the person was defrauded by reason of it, it is your duty to consider that and all the other circumstances for the purpose of determining with what intent the money was converted.”
This informed the jury that a mere conversion without fraudulent intent accompanying the act of conversion would not be sufficient to warrant cojrviction. The court further charged:
“The essential element in the crime charged is the feloniops intent, and, before you can convict the defendant, you must find from the evidence in the case that he intended to convert to his own use, or to the use of some person other than the owner, the money, or some part of it, belonging to Helena Mizer and to cheat and defraud her. The felonious intent is an essential element of the crime of embezzlement, and must be shown by the prosecution beyond a reasonable doubt in order to convict the defendant.”
The fact that no demand was made upon the defendant for. the money before the prosecution was of no materiality. The defendant and his associate, Wagner, disarmed the vigilance •of their principal by concealing the fact of payment and continuing to pay the interest periodically, and the fact that the
By the Court. — Tbe judgment of tbe circuit court is affirmed.