| N.Y. App. Div. | Dec 30, 1909
The relator having been arraigned before a city magistrate on a charge of larceny was held to await the action of the grand jury and committed to the custody of the warden of the city prison. He sued out a writ of habeas corpus. On the return thereof the Writ was dismissed and relator remanded, and from the order so providing this appeal is taken.
The question presented is whether it appeared that a crime had been committed and there was'sufficient cause to believe the defendant guilty thereof.
It appears that the relator on the 29th of April, 1907, filed a certificate in the office of the clerk of the county of Hew York in which he certified, that he was conducting and transacting the business of broker, banker, real estate, r’ailroad and steamship ticket and forwa2*ding" agent at 108 Greenwich street, in the city, county and State of Hew York, under the name and style of Frank Zotti & Company, and that the true and full name of the person conducting such business was Frank Zotti.
Chapter 185 of the Laws of 1907, which took effect upon its passage, April 22, 1907, provides that “ All corporations, firms and pei’sons now or hereafter engaged in the selling-of steamship or railroad tickets for transportation to or from foreign countries, who, in conjunction with 'said business, carry on the business of receiving deposits of money for the purpose of transmitting the same or the equivalent thereof to foreign countries, shall, before entering into said business or before continuing said business * * * make, execute and deliver a bond, to the People of the State of Hew ■ York in the sum of fifteen thousand dollar's, conditioned for the faithful holding and transmission of any money or the equivalent thereof which shall be delivered to it or them for transmission to a foreign country.” And it was further provided that “ Any corporation, firm' or person entering into or continuing in the business aforesaid, contrary to the provisions of this act, shall be guilty of a misdemeanor.”
In holding this act valid and constitutional this court said, in Musco v. United Surety Company (132 A.D. 300" court="N.Y. App. Div." date_filed="1909-05-14" href="https://app.midpage.ai/document/musco-v-united-surety-co-5211319?utm_source=webapp" opinion_id="5211319">132 App. Div. 300; affd., 196 N.Y. 459" court="NY" date_filed="1909-11-23" href="https://app.midpage.ai/document/musco-v--united-surety-co-3592742?utm_source=webapp" opinion_id="3592742">196 N. Y. 459): “ It merely regulates the carrying on of that business by guarding, in the form-of a bond, against imposition, fr’aud and embezzlement. "x" * * The Legislature could well take notice
On April 9, 1908, one Mare Luzina delivered to a clerk in the employ of Zotti $205, with instructions that the same was to be forwarded to the Imperial and Royal Post Savings Bank at Vienna, Austria, and she received a paper in two parts, joined together by a perforated line, reading: “ This receipt is to be kept by the purchaser. No. 18550, New York, April 9, 1908. Received from Mi\ Mare Wife of Anton Luzina One thousand Kronens, to be sent to Mr. Imperial and Royal Post Savings Bank’s office in Vienna through the mail. Kronens 1,000. Frank Zotti & Co. This notice goes to the addressee. No. 18550. New York, April 9, 1908. Imperial and Royal Post Savings Bank’s office. Through' the mail in Vienna you will receive One thousand Kronens. Sent to you through Mr. Mare, wife of Anton Luzina. ' Kronens 1,000. Frank Zotti & Co.” A memorandum was made on the stub in the book from which said paper was taken, “ No. 18550, date April 9, 1908. The recipient of the money, Imperial and Royal Post Savings Bank at Vienna. Money sent by Mare, wife of Anton Luzina, address 34 Desbrosses Street, $203.50, Kr. 1000.” Zotti was present at the time of the receipt of the money and the delivery of the said papers to Mare Luzina. ■ The clerk stated to her that the said money would be delivered to the Imperial and Royal Post Savings Bank at Vienna promptly, and that within a month she would have a receipt in her hands from the bank" in Vienna acknowledging the receipt' of said .$205. The said clerk delivered the sáid $205 to the cashier of Zotti, and the said sum was deposited by the cashier to the credit of Zotti in a bank in New York; an employee of the said Zotti prepared-a list of names of persons from whom various sums of-money were received by
About a month or forty days after the ninth day of April, Anton, the husband of Mare Luzina, called at Zotti’s office and asked him why the money had not been forwarded abroad, and Zotti told Luzina that he should wait about fifteen or twenty days-and that he Would have the receipt for the money. At the expiration of about ten or fifteen days from the time of that call by Luzina and tlie conversation alluded to, Luzina again called at relator’s office and found the place closed.
On the fourteenth day of July an involuntary petition in bankruptcy was filed in the United States District Court for the southern district of Few York against said Zotti, and on the said day the court appointed a receiver in bankruptcy,' who took possession of Zotti’s place of business on July 15, 1908.
Some of the exhibit's in the case were in the possession of the receiver appointed in the bankruptcy proceeding, and were produced before the city magistrate by said receiver under subpoena. They were received in evidence on the examination, over the defendant’s objection that their reception by the magistrate was in violation of his constitutional rights.
It thus appears that the relator, a person engaged in the. selling of steamship tickets for transportation to or from foreign countries,
The People claim that the facts set forth constitute the crime of larceny under'seetion 528, subdivision 2, of the Penal Gode, which provides that “A person who, with the intent to deprive or defraud the true owner of-his property, or of the use and benefit, thereof, or to appropriate the same to the use of the taker, or of any other, person * * * having in liis- possession, custody or control, as a bailee, servant, attorney, agent, clerk, trustee or officer of any person, association, or corporation, or as a public officer, or as a person authorized by agreement, or by competent authority, to hold or take such possession, custody or control; any money,'property, evidence of debt Or contract, article of value of any nature, or thing in action or possession,- appropriates the same to his own use, or that of any other person other than the true owner or person entitled to the benefit thereof'; steals such property, and is guilty of larceny.” And'the specific claim is that Zotti received the said sum of money as the agent of Mrs. Luzina under the special instruction and agreement to forward it to a specified place and that having failed so to" do and having deposited it to his own account he converted.it to his own" use and committed larceny. The relator claims that the facts -disclosed the relation of debtor and creditor merely.
It will be noted that in the Musco Case (supra) this court, speaking' of the act prohibiting ticket agents from carrying, on the business of receiving deposits of money for the purpose of transmitting the same to foreign countries .without the giving of the bond there required, said : “ The Legislature could well take notice of the frequent embezzlements and misappropriations by transatlantic ticket agents of funds intrusted to them for transmission by their fellow-countrymen.” ,, ' , -
Of course the relation of debtor and creditor, existed, but that
In People v. City Bank of Rochester (96 N.Y. 32" court="NY" date_filed="1884-04-29" href="https://app.midpage.ai/document/the-people-v--the-city-bank-of-rochester-3611037?utm_source=webapp" opinion_id="3611037">96 N. Y. 32) the bank received certain- checks in payment of notes which it had discounted and credited the makers with having paid the notes; but the bank had previously sold the notes and failed before they became due. It was urged that the checks received became general assets of the bank, but the court held that “ they were delivered to it with explicit directions to apply the proceeds on payment of the notes ; those directions were assented to by the bank officer and the checks collected from the general fund. Prom that moment the bank was bound to hold the money for and apply it to that purpose and no other, or failing to do so, return it to the petitioner. As to it, the bank was bailee or trustee, but never owner. * * * The specific object for which the fund was created was the payment of the notes. * * * The checks were impressed with a trust, and no Change of them into any other shape could divest it so as to give the bank or its receiver any different or more valid claim in respect to them than the bank had before the conversion.”
In Libby v. Hopkins (104 U.S. 303" court="SCOTUS" date_filed="1881-12-19" href="https://app.midpage.ai/document/libby-v-hopkins-90457?utm_source=webapp" opinion_id="90457">104 U. S. 303) it was said : “ When A. sends money to B. with directions to apply it to a.debt due from him to B., it cannot be construed as a deposit, even though B. may be a banker. The reason is plain. The consent of A. that it shall be considered a deposit and not a payment is necessary and is wanting.”'
In Cutler v. American Exchange National Bank (113 N.Y. 593" court="NY" date_filed="1889-06-04" href="https://app.midpage.ai/document/cutler-v-american-exchange-national-bank-3616244?utm_source=webapp" opinion_id="3616244">113 N. Y. 593) plaintiffs paid the bank §500 to be remitted to a bank in Lead-ville for the use of one H. Plaintiffs received a letter of advice which they forwarded to H., but before its receipt the Lead-ville bank had failed and its receiver refused to pay the money. Plaintiffs then demanded that the defendant either carry out its agreement or refund the money. Quay, J., said“ The plaintiffs wished to make a payment to a certain person in a distant State, and the defendant undertook to effect it for them in its own way. When the plaintiffs assented and paid in the sum 'desired to be remitted, they received the paper writing in question. From that moment the defendant became a depositary of a fund, which was, by its own agreement, devoted to one particular purpose and to no other.
. In Johnson v. Whitman (10 Abb. Pr. [N. S.] 111) a remittance of bank notes was attémpted to be made through a banker. He treated it as a general deposit and converted it to his own use. Held, that he was properly arrested for conversion and.could not be heard to assert any debtor and creditor relation. (See, also, Straus v. T. N. Bank, 122 N.Y. 379" court="NY" date_filed="1890-10-28" href="https://app.midpage.ai/document/straus-v-tradesmens-national-bank-3600603?utm_source=webapp" opinion_id="3600603">122 N. Y. 379.)
Irrespective of the broad principle laid down by these cases, taking special deposits received under explicit instructions out of general assets, we have the specific legislative enactment in chapter 185 of the Laws of 1907, .requiring the giving of the bond by persons conducting snch business as relator was engaged in “ conditioned for the faithful holding and transmission of any money, or the equivalent thereof) which shall be delivered to it or them for transmission to a foreign country.” In the face of that legislation it is impossible to regard the relations existing between the relator and Mrs. Luzina as merely that of debtor and creditor.
The crime charged is that defined in the Penal Code, and as said by Fisroi-i, J., in People v. Sherman (133 N.Y. 349" court="NY" date_filed="1892-05-24" href="https://app.midpage.ai/document/people-v--sherman-3590796?utm_source=webapp" opinion_id="3590796">133 N. Y. 349), where the . manager and director of elevator companies engaged in receiving and storing grain for others was indicted as agent and bailee : “ It is of little utility to carry our inquiry back of the terms of the Penal Code when the'offense charged and proved is clearly within it.”
The Penal Code was adopted in 1881, and in 1886, by chapter 672 of that year, section 549 of the Code of Civil Procedure, providing “ when the right to arrest depends upon the nature of the action,” was amended by adding that such right existed where- the action was brought “ To recover for money received, or to recover property or damages for the conversion or misapplication of prop- . erty where it is alleged in the complaint. that the money was received or the property was embezzled or fraudulently misapplied by a public officer or by an attorney, solicitor or counselor, or by an officer or agent of & corporation or banking association in the
These Code provisions, one making embezzlement by an agent a crime, and the other a tort, and giving the civil remedies, of arrest and execution against the person, passed within a few years of each other, indicate the clear intention of' the Legislature to put an end to such breaches of trust if possible, and the courts have steadily enforced them. . ,
In Britton v. Ferrin (171 N.Y. 235" court="NY" date_filed="1902-05-13" href="https://app.midpage.ai/document/britton-v--ferrin-3629343?utm_source=webapp" opinion_id="3629343">171 N. Y. 235), an action for conversion brought against commission merchants, the court said: “ The defendants were commission agents or factors of the plaintiff for the sale of his goods. * * * Where one intrusts his property to another for a particular purpose it is received in a fiduciary capacity, and when turned into money that is also received in the same capacity. It does not belong to the agent, and he can lawfully exercise no power or authority over it except for the benefit of his principal, and only as authorized by him. If the agent uses it for his own purposes or fails to pay it over upon a seasonable demand it is a conversion of that which does not belong to him. * * * The cause of action alleged in the complaint and established on the trial is within the principle of these cases, and under the provisions of section 549 of the Code of Civil Procedure the action is one where the defendants could be arrested, and where an execution against the person might be issued under section 1487. Whatever may have been the rule as to the liability of factors upon their refusal to surrender to their principal the avails of property consigned to them for sale anterior to the amendment of section 549 in 1886, we think that amendment plainly evinces an intent by the Legislature to place an action to recover money received by a factor, agent, broker or other person in a fiduciary capacity within the category of torts, iyid to secure to a principal the same rights and "remedies that exist as to other wrongs of a similar character. * * * Thus it seems clear that the Legislature regarded an action brought to recover money received by an agent or factor in a fiduciary capacity, which he refuses to deliver to his principal, to whom it belongs, as one of tort, and to secure to a plaintiff the same remedies as in actions for fraud, conversion or other similar misconduct.”
People v. Civille (44 Hun, 497) was the case of a rent collector
We have no doubt that a sufficient case was made, out , to justify the action of the magistrate in committing the defendant to await the action of the' grand jury. ■ -
The relator raises the question of the admissibility of entries from his books produced by the receiver in bankruptcy under subpoena, ■ upon the ground that such-receipt was in violation of his constitutional right and required him in a criminal proceeding to give evidence against himself. It is doubtful whether such question is properly raised on habeas corpus. We do not think it necessary to consider the question further than to say that in our opinion the point seems to have been decided adversely to the contention of the relator in People v. Adams (176 N.Y. 351" court="NY" date_filed="1903-11-10" href="https://app.midpage.ai/document/people-v--adams-3588018?utm_source=webapp" opinion_id="3588018">176 N. Y. 351), unanimously affirmed by the United States Supreme Court (sub nom. Adams v. New York, 192 U.S. 585" court="SCOTUS" date_filed="1904-02-23" href="https://app.midpage.ai/document/adams-v-new-york-96015?utm_source=webapp" opinion_id="96015">192 U. S. 585) and.specifically as to the boobs of a bankrupt by the Circuit Court, of Appeals in the first circuit in Kerrch v. United States (171 Fed. Rep. 366).
The order appealed from should be affirmed.
Ingeaham, McLaughlin, Houghton and Scott, JJ., concurred.
Order affirmed. -