174 A.D. 608 | N.Y. App. Div. | 1916
Lead Opinion
This is an appeal by the defendant from a judgment of the Kings County Court, rendered July 27, 1915, convicting him
The following is an outline history of the bank, defendant’s connection therewith and of the proceedings in this action:
At and for some time prior to January, 1908, the Mechanics and Traders’ Bank was doing a banking business in the boroughs of Manhattan and Brooklyn, having its main office in Manhattan and twelve branches in all. Its financial condition became impaired and it was closed on January 30, 1908, the State Banking Department then assuming charge of it. In the ensuing six months during which it remained closed and in the hands of such Department or of a receiver, two examinations of its affairs and condition were made, namely, one in February, by the Department (Defendant’s Exhibit 63), and one by Cole& Swasey, accountants employed by the directors under authority of a Special Term court order (Defendant’s Exhibits 65 and 66). A plan of reorganization and reopening was formed, approved by the Banking Department and duly authorized by a court order. That plan was consummated and the bank reopened under the name of the Union Bank on August II, 1908. The leading features of that plan were: (a) The change in name; (b) the reduction of the capital stock from $2,000,000 to $1,000,000; (c) the deferred payments in certain specified installments of a large percentage of the deposits; (d) the discontinuance of the Manhattan offices; and (e) the assumption of the presidency by the defendant. As a basis for such reorganization another examination and appraisal in detail of the assets was made by the Department and reported to the court under date of July 18, 1908. That report gave the assets in large detail and showed that with such reduction of capital the bank was solvent and even had a surplus above
The indictment in this action was presented also in said County Court on December 29,1913. Upon a contested motion this indictment was removed to this court by order made at such Special Term, January 15, 1914. At a similar term, held March 6, 1914, also upon a contested motion, an order
The trial began in the County Court on May 24, 1915, and closed with the verdict on' July twenty-fourth following, having lasted nine weeks. The jury were out from July twenty-second at six p. M., to July twenty-fourth at ten-forty P. m., having in the interim returned to the court five separate times for further instructions or the reading of certain testimony as requested by them. The jury accompanied their verdict of guilty with a recommendation to mercy, which was evidently heeded by the learned trial judge.
The record here contains 5,218 pages, and the briefs submitted by the respective learned counsel comprise 1,616 pages, so that the task of their examination has been necessarily great. Moreover, the counsel elaborately and illuminatingly argued orally the main questions involved. It seems proper first to review the three intermediate orders specified in the notice of appeal.
The first such order is that made May 18,1914, denying defendant’s motion to dismiss the indictment. That motion was made upon two grounds, viz.: (a) That the grand jury had received and considered much incompetent and, therefore, illegal evi
As to the first of those grounds, it is apparent that, if the views hereinafter expressed are correct, much illegal evidence was received by the grand jury, but that there was also before it sufficient competent evidence to warrant the indictment. In general the latter fact is a complete answer to such ground of attack. (People v. Sexton, 187 N. Y. 495, 511, 512.) The notice of such motion was entirely general, viz., to dismiss the indictment as a whole and not a single designated specification therein, as was the motion in the Osborne case (People ex rel. Weeks v. Platt, 173 App. Div. 451), recently decided by this court.
As to the other such ground for the motion, it is my opinion that the indictment was based upon the report made to the Superintendent of Banks and not upon the paper actually published by the bank. I have read with care the opinion of the learned justice in granting the certificate of reasonable doubt, in which he held that the indictment was based upon the latter paper solely (91 Misc. Rep. 451); but I find myself unable to concur with his views and conclusion. In his opinion upon denying the motion to dismiss the indictment, the justice presiding treated this point quite briefly, and perhaps took the view that the indictment could be regarded as based upon both papers. (See 85 Misc. Rep. 576.) If that was his conception of the matter, I do not agree with him, for it seems to me manifest that the indictment was based solely upon the report made to the Superintendent, and that there could be only one such. Section 21 of the Banking Law (Consol. Laws, chap. 2; Laws of 1909, chap. 10) then provided that every such bank should, at least once in every three months, make a written report to the Superintendent of Banks “ in such form and containing- such matters as he shall prescribe,” and, in addition, “ the amount of deposits the payment of which, in case of insolvency, is preferred bylaw or otherwise over other deposits,” and
Section 24 of that law provided that within thirty days after the making of such report the Superintendent shall publish a summary statement thereof in the State newspaper published at Albany, and that “ the separate report required by said section [21] of each "corporation and individual banker shall be published by such corporation or individual banker in at least one newspaper of the place where its principal place of business is located. ”
It is to be noted that by section 24 the duty'of publishing" the report was laid directly upon the bank itself, and that the provision called for the publication by it of the report and not of a mere abstract or summary thereof, whereas the publication directed to be made by the Superintendent was merely of a specified summary of the report, and that the former publication was'to be made in a local newspaper and the latter in the State newspaper at Albany. It appears that in this instance the Superintendent, in accordance with his general practice, sent to this bank printed forms, both for the report and for the paper to be published by the bank, and that those forms were filled out by the bank officials and so used. As I read and construe the statute, the Superintendent had nothing whatever to do with the publication by the bank any more than to discharge his general duty of seeing that such an institution complied with the law. He had no power to authorize the bank to publish anything less than a full copy of the report.
In this case the report actually made to the Superintendent is in evidence as People’s Exhibit 22, and the paper published by the bank is also-in evidence as People’s Exhibit 23, with a photographic copy of each, the former being headed “quarterly report” and the latter “report of the condition.” Each paper appears upon its face to have been verified by the defendant as the president of the bank. As a witness he admitted that he verified the report, viz., Exhibit 22, but denied that he verified the other, namely, Exhibit 23. The testimony of the notary, before whom the verification purports to have been
All the foregoing specifications thus contained in the indictment as features of the report therein referred to are true of the report made to the Superintendent and in evidence as said Exhibit 22, excepting the one statement that the bills payable did not mature until December, 1910, whereas the other paper, the one published by the bank, was not presented to the Superintendent as a report, but merely as proof of the required publication, and such latter paper did not contain various particulars of the deposits which the report did contain and by the form furnished by the Superintendent was required to contain. The controlling element of identification in the indictment appears to me to be the allegation that the report was the one required to be made to the Superintendent. The mistaken allegation therein that the report contained, among many other statements, the one that the bills payable did not mature until December, 1910, was simply a partial misdescription of the report in that respect and did not serve to vitiate
The same question as to the basis of the indictment was in various ways raised at the trial, and the learned-presiding county judge held, as I think, properly, that the indictment was based upon the report made directly to the Superintendent and not upon the paper published by the bank. Accordingly, he refused to submit to the jury as a possible specification of perjury the said statement that the bills payable were not due until December, 1910.
The learned justice who granted the certificate of reasonable doubt, in his opinion, made much of the fact that the report to the Superintendent, viz., Exhibit 22, was not published, while the paper, Exhibit 23, was, and that the indictment alleges that the report which forms its basis was published. I perceive no difficulty arising from that source. While the paper published was not, as by said section 24 it should have been, an exact copy of the report, yet it cannot be doubted that it was regarded by the Superintendent, in providing the form thereof, and by the bank and the defendant in publishing the same, as a substantial copy of the report. It is to be noted that in the instructions by the Superintendent, which accompanied the form for the report furnished by him, was one that “ A copy of this report must be made out on the enclosed sheet and published in a newspaper of general circulation in the town or city * * * where the bank is located. ”
I conclude, therefore, that the motion to dismiss the indictment was properly denied.
The second such order recited in the notice of appeal is the
The third and last order recited in the notice of appeal for incidental review is the one made March 11, 1915, at the Kings County Special Term, denying defendant’s motion for a change of venue. Such motion was made upon two main grounds, namely, that owing to the great public agitation in Kings county over the failure of the bank, many people in that county, from which the jurors must be taken, had expressed opinions unfavorable to the defendant; and that the great publicity given by all the newspapers of Brooklyn to the said banquet speech and subsequent statements of the district attorney had strongly impressed the people of Brooklyn with the idea, really unwarranted, that the defendant had sought and obtained judicial favors in this very case, and that such impression had greatly prejudiced such people against him, all with the result that he could not obtain a fair trial in that county.
The learned justice presiding at such Special Term denied the motion, as his opinion indicates, because the moving affi
In the conduct of the trial several errors, substantial and to the defendant prejudicial, were committed.
Such an error was the submission to the jury of the alleged
The indictment alleged the said statement, and that the bank did not have loans and discounts to that amount or to more than the sum of $2,955,486.72, 'making such statement to have been excessive in the amount of $1,998,676.80, and that the following items, specifying thirty-five which aggregated just the said excess, made up a part of said statement, and were in fact not “ loans or discounts or resources of the said bank.”
The report also contained the following statement as an item of said “resources,” viz., “ Stocks and bonds [other than public securities which were of the value of $1,000], $339,434.12.”
The indictment alleged the fact of such statement, and that the bank did not have stocks and bonds which were resources of it to that value or to more than the value of $215,464.38, making such statement excessive by the sum of $124,969.74. The indictment also alleged that the following items, specifying two which aggregated such entire excess, were included in that statement but were not in fact resources of said bank. The indictment also alleged, as was the fact, that the report included under said head “resources” a statement that the bank owned real estate amounting in value to $547,187.46, and that said statement was untrue in that such real estate was not then worth over $430,187.46, making such statement excessive by the sum of $117,000; and that “the following items and properties ” were included in the said statement at certain stated values and were not worth more than certain other stated respective values, specifying six different real properties, the first so stated values being those carried out in the statement in the report and aggregating the said amount thereof, and the second stated real values aggregating just $117,000 less. The indictment thus specifically alleged forty-three items of resources as having been falsely stated and included in the report. It also alleged five certain other falsely stated items therein upon the
At the conclusion of the People’s case, upon defendant’s motion, the trial judge struck out thirteen of those forty-three items of resources, all being of the said thirty-five items of loans and discounts, and also all evidence relating thereto. That left thirty-five specified items of all sorts, thirty-two of which were specifically submitted to the jury as specifications upon which guilt might he found. The trial judge submitted those in the form of six groups or branches, as he termed them, of which the third consisted of seven of the twenty-two loan and discount items specified in the indictment and not stricken out, viz.:
Ashford Company............................. $2,769 40
Consolidated Briarwood Estates................. 191,547 00
Corporate Realty Association.......•........... 13,035 57
Metropolitan Holding Company................ 171,542 45
Orr Contracting Company...................... 20,079 31
Shetland Company............................ 460,800 00
$859,773 73
and William R. Pearce........................ 87,642 55
$947,416 28
The submission was to the effect that the prosecution claimed, (a) not that the several assets referred to in the seven items were not of the values stated, which fact indeed the district attorney repeatedly admitted, but tha't they were really not loans or discounts, but mortgages or real estate of the bank and should have been included-in the report as such; and (b) that the said corporations, debtors, were merely “ dummy companies, controlled by the bank, the stock and assets of which were owned or controlled by the bank,” and that indeed was the claim of the district attorney. The instruction was that if the jury found that such claim was proven, then they should find that the falsity of the report in that respect was established. Later the charge instructed the jury that the falsity of any one of the items submitted, if proven, was sufficient to
The evidence showed that the six several corporation debtors included in the said third group submitted as above stated were corporations which the bank in one way or another controlled. All of them except the Shetland Company had been inherited by the then present bank from its predecessor, through the reorganization. That company had been organized during the defendant’s presidency; and, if the theory of the district attorney and trial court be applicable to any of the items, it is perhaps more clearly applicable to the item of the alleged loans of $460,800 to that company. It was incorporated by the defendant, as president of the bank, on March 26, 1909, pursuant to a resolution of its board of directors passed February 9, 1909, and began business in April or May following. That resolution was to the effect that the president should cause the company to be incorporated with a capital stock of $100,000, subscribe for its stock and pay in the amount thereof, transfer to it from time to time real estate or mortgages held by the bank, taking back therefor either the company’s notes or certificates of interest or participation or declaration of trust, engage a competent real estate man to manage the same and to do certain other incidental things. (Defendant’s Exhibit 93.) The bank paid in the capital, took the stock and, from time to time, made loans to the company and transferred to it for such consideration certain real estate which the bank had held and had the company buy certain properties in at foreclosure by the bank of certain of its mortgages, and take and hold title to the same. The defendant in his testimony claimed that his sole object in
The same observations and conclusions are in substance true of the other items included in such third group or branch, except that the other corporations were established or acquired under or by the former bank, and that in the case of the individual, Pearce, the titles were taken and held by him indi
Moreover, it seems to me that falsification by such alleged wrongful classification of certain assets was not within the intent of the indictment. If that had been drawn upon the theory that the real estate holdings of the said several corporations really belonged to the bank, the grand jury could not, with any sort of fairness or intelligence, have failed to credit the defendant with the value of those holdings as a part of the real estate values in the assets of the bank. I am unable from the record to make up an exact table of the value of those holdings, but it is evident that then* values, with the lowest valuation by plaintiffs’ witnesses of the several real estate items specifically alleged in the indictment, would have exceeded one million of dollars, whereas the report gave the value of the real estate of the bank at only $547,187.46. The district attorney repeatedly admitted that he did not claim that those loan items were, in making up the report, valued at more than the values of the net assets of the several companies which they represented. Hence those net assets were worth $859,773.73, which is the aggregate of the stated values of said corporation loan items, and most of those assets were real estate. In the view of the matter taken by the district attorney and the trial court, the grand jury could not have charged in the indictment that the real estate value was overstated in the report. We know well that the indictment must have been drawn by the astute and experienced district attorney, and that in doing that work he could not have made such a gross and grievous mistake as that.
I conclude, therefore, that the submission to the jury of the said third group or branch of items was error.
Another error, substantial and to the prejudice of the defendant, was the submission to the jury of the specifications in the indictment of the values of the several real properties held in the name of the bank, as a sufficient basis for finding the statement in the report of the value of the bank’s real estate to have been false. I think that the evidence was insufficient to warrant that submission.
The report stated that the value of the bank’s real estate was
Stated Real
Properties. values. values.
808 Broadway...................... $190,000 $140,000
79 Hamilton avenue................... 45,000 30,000
2495 Atlantic avenue................... 50,000 30,000
1240 Broadway....................... 180,000 160,000
310 Driggs avenue.................... 20,000 15,000
Corner of Broadway and Hancock street. 22,000 15,000
The charge submitted those items as its fourth group or branch of items of resources whose falsity was questioned by the evidence. In that submission the trial judge appears to have submitted plaintiff’s case solely upon the testimony of their experts; but there was in fact other evidence for the prosecution upon the subject. Still I think that, taken altogether, the proof was insufficient to establish beyond a reasonable doubt that defendant, at the time he verified the report, knew that the statement as to the real estate valuation was false as being substantially excessive in amount. The learned trial judge in substance instructed the jury that in order to convict the defendant as to any statement in the report, they must, considering the form of defendant’s oath, viz., “ to the best of his knowledge and belief,” find it established beyond a reasonable doubt that he knew the report to be false in that respect. That is the general rule as to perjury in opinion evidence. (People v. Doody, 172 N. Y. 165.)
In the very nature of things, a statement of the value of a parcel of real property must, at least except under very exceptional circumstances, be a matter of opinion; andas thus stated in the charge, in order to convict -the defendant of perjury in making under oath such a statement, the evidence must establish beyond a reasonable doubt that when he made it he knew the statement to be false.
The People attempted to prove the falsity of said statement in the report of the valuation of the real estate by the testimony
There was, however, as above stated, other evidence for the People upon the subject. Such other evidence in the main consisted of certain talks between the defendant and one Corwith, a director in one of the branches of the bank. He testified at first, under somewhat leading and suggestive questions, that upon several, at least three, occasions, beginning about the time this bank opened, he told the defendant that he thought the Greenport Branch property was carried upon the books of the bank at too high a figure, viz., $150,000, and that he did not think that it was worth more than $100,000, and that defendant said that the bank had received from the Banking Department such valuation with the value of the other real properties, but that defendant agreed with him that when the time was opportune such value would be reduced by the bank officials. It later appeared that he only inferred that defendant agreed with him, and that in fact, the defendant did say that they were carrying the properties at the values which had been given them by the Banking Department. Upon his cross-examination it appeared that every six months, as a member of the committee of the bank’s directors, to investigate and report to the board upon the condition of the bank, the witness had under oath himself reported only the very values of said real properties as stated by the defendant in the report here in question." It would seem that under those circumstances very little weight could reasonably be given to his testimony. At the best, however, that merely showed that he expressed to the defendant his opinion that one of the banking house properties was upon the books of the bank being valued one-third too high, and that as against such opinion the defendant had the valuation turned over to him by the Banking Department but was at the time considering reducing such valuation. This, also, seems to me a very slight and insufficient basis upon which to predicate perjury against the defendant.
Upon this subject the plaintiff had also another item of proof, namely, a pencil memorandum (Plaintiff’s Exhibit 935). That paper was produced by plaintiff’s trial counsel upon the
I perceive in the record no other substantial evidence in favor of the plaintiff upon this question. The values included in the statement in the report were those which the Banking Department had given at the reorganization, and which had been upon the books of the bank throughout defendant’s presidency and had been approved or at least permitted by three examinations by the State Bank Examiners and had been returned by the several sworn reports of the examining committee of the board of directors at three different times at the several six months’ periods. It seems to me entirely unwar
Moreover, as hereinbefore stated, if the third group of items was properly submitted to the jury as false because wrongly classified, it is plain that the real estate valuation was in the report far understated and not at all excessive. It is incomprehensible to me how this view of the matter can have escaped the appreciation of the learned and experienced district attorney and trial judge. It appears to me to be manifest even to a demonstration. The unfairness of the trial is perhaps better or more strikingly exhibited by this feature of the case than by any other. The submission of both such third group, namely, that of the alleged wrong classification, and of the fourth group, namely, that of the real estate valuation, was independent of one another. It was not in the alternative, namely: “If you fail to find the alleged false classification established, then you may consider and pass upon the question of the alleged false valuation of the real estate.” It may well be that the jury convicted the defendant upon both the third and fourth groups, which would constitute an utterly unwarranted and indeed an absurd situation.
I conclude, therefore, that it was error to submit to the jury such fourth group of items, and that defendant’s motion to strike out such items should have been granted. I do not find that the learned counsel for the defendant excepted to the submission of either of the groups herein considered. He evidently relied upon his motion to dismiss or strike out the various items comprising them, and upon his exception to the denial of each such motion, as no doubt he was entitled to do. However, even if no exception had been taken to such important rulings or proceedings, it would be our duty here to consider and review them.
Another grave error in the conduct of the trial was the submission to the jury of the fact that the report did not state any contingent liability of the bank, when in truth it had two such. That matter was submitted as the sixth branch or group of the items specified in the indictment and not dismissed or stricken out by the trial court.
The Banking Law, section 21, provided that such quarterly report of a bank should contain a statement of the amount of preferred deposits, and otherwise shall be “ in such form and containing such matters as he [the said Superintendent] shall prescribe,” and the Superintendent here performed such duty of prescribing by furnishing such blank form. It seems to me entirely clear that the defendant, under that law, was required to have in the report only answers to such inquiries as were therein specifically made, and that it was entirely optional with him whether or not he would insert anything else in the half inch blank space where the learned counsel for the plaintiff claimed he should have written in said contingent liabilities. The very language of the instruction above quoted from the back of the form, viz., “ If you wish to report items to which the printed heads will not apply, write them in on the blank lines,” clearly stated a voluntary option, not an imperative duty. It is not questioned by plaintiff’s counsel that the said printed subsidiary lines did not call for a statement of such contingent liabilities, and of course the general heading, “Other liabilities, viz.,” was merged in the subsidiary ones named below it. At the most it was a doubtful matter whether or not the form required a statement of such, contingent liabilities, and no perjury should be predicated upon a matter so doubtful. It is evident that the learned trial judge was himself in doubt upon the subject, as he attempted to put over upon the jury what was clearly his own duty and province, namely, to determine whether or not the law and the requirements of the Superintendent in evidence required the defendant to report such contingent liabilities, namely: “I decline to charge that, and leave it as a question of fact for the jury.” It would he interesting to know upon what test the trial court supposed the jury were to determine that question. I do not perceive that he gave them any test or standard for the work. Perhaps he intended that they should apply the
Another serious question of error is presented by the receipt in evidence of a large number of other items and other acts of the defendant than those specifically chargéd in the indictment, and the submission of those to the jury as evidence of “ guilty knowledge,” or, as more fully later stated in the charge, as evidence that the items specified in the indictment were included
Three days before the trial began the district attorney served upon defendant’s counsel a written notice to the effect that at the trial the plaintiff would offer evidence of eighty-five items specified in the notice, in addition to those specified in the indictment as having been included in the totals, given in the report, of figures in excess of the true values. The counsel for the plaintiff contended then, as respondent’s counsel do now, that it was sufficient for the indictment to charge the falsity of any statement in the report, even of any total, and that at the trial it was competent for the plaintiff to introduce in evidence any item of the assets or liabilities intrinsically included in such statement to establish such falsity. This view the trial court refused to adopt, and, therefore, declined to receive such proof of such added items to establish the allegations of the indictment as to falsify, but admitted the evidence solely to show “guilty knowledge ” of the falsity of the items specifically charged in the indictment, dr some of them. In that view and decision, that such proof could not be received to establish the falsification alleged in the indictment, I agree. According to the contention of respondent’s counsel, it would have been enough for the indictment to allege the falsity of the most general and final summary contained in the report, namely, the amount of the surplus, and then at the trial to sustain that allegation by proof that any subordinate detailed statement of the report was false. I do not think that that view is correct. It seems to me that the- command of subdivision 2 of section 275 of the Code of Criminal Procedure, that the indictment shall contain “ A plain and concise statement of the act constituting the crime, without unnecessary repetition,” required
The counsel for the respondent here attempts to justify the receipt of such evidence and the such submission thereof upon the authority of People v. Katz (209 N. Y. 311); and the trial court evidently regarded that case as being such authority. The opinion in that case clearly and succinctly stated the general rule which upon the trial of a criminal action confines the plaintiff’s evidence to proof of the commission of the identical criminal acts charged in the indictment. Upon that point the opinion said: ‘‘ There are various recognized exceptions to this rule, however, and one of them is that when guilty knowledge, quite commonly called intent, is an essential ingredient of the crime charged, evidence is admissible of similar crimes or acts committed or attempted at or about the same time by the person charged. The reasons for the rule and the exception are equally simple and obvious. * * * Familiar illustrations of this exception to the general rule are to be found in cases of uttering counterfeit money, in forgery, in obtaining money under false pretenses, and in receiving stolen property.” (209 N. Y. 327, 328.)
It is to be noted that perjury was not included in that enumeration. The test for the application of the exceptional rule,
The trial court here, even at the request of defendant’s counsel, charged that in order to convict the defendant the jury must find that the said quarterly report “signed by him on the 2d day of April, 1910, was signed with the intent to commit a crime, with a felonious intent, and with intent to deceive the Banking Department or others to which the report was to be remitted,” and in so charging the trial judge was clearly mistaken. He had in the main charge correctly defined the requisite intent in substantial accord with the rule of the Hegeman Case (supra). By that rule, if defendant, when in the report he made a given material statement, then knew it to be false, he was guilty of perjury when he verified the report, whatever his motive in so doing was. As I understand the rule, under such circumstances proof of the commission by the defendant of other like acts at or about the same time, having the like purpose to deceive, is not competent. Ho precedent to the contrary in any perjury case is cited in the briefs. The case of People v. Doody (172 N. Y. 165) does not appear to me to be such a precedent. The defendant there was charged with perjury in having, at the second trial of a certain case, testified that he did not then remember certain material facts to which he had testified at the former trial only a few months before. It became material, therefore, for the plaintiffs to show that he did have those facts well in mind, and to that end they were permitted to prove his many prior statements of those facts, and such procedure was upheld by the Court of Appeals. Upon that point the opinion said: “ This testimony was not offered or admitted for the purpose of proving other offenses, but for the purpose of
It is suggested by counsel for the respondent that information as to many of such items and facts could have been forced from the defendant upon his cross-examination, to discredit him as a witness. Ho doubt at least some of them could, but then they could not have been submitted to the jury as evidence to any other effect than as impairing his such credibility, and the plaintiff could not have directly contradicted any of defendant’s statements as to the same or added any proof in regard to the matters involved therein:
In the view most .favorable to the plaintiff of this class of evidence, its competency was doubtful, and at the trial of a
The failure to maintain the reserve up to the statutory standard was such a matter. Section 67 of the Banking Law (as amd. by Laws of 1909, chap. 223) required such a bank to maintain a reserve in cash or upon deposit with other banks and trust companies of not less than twenty per cent of its aggregate deposits, exclusive of deposits which are secured by outstanding unmatured bonds issued by the State of New York, and that when the reserve is below that standard no new loans shall be made by the bank, The evidence showed that in estimating such reserve this bank included certain certificates of deposit with a trust company, which deposits that company held as security for loans, and that with those certificates excluded the reserve of this bank was below such standard for a long time, and with them included was below that for some considerable time, although at times only a fraction of one per cent below. The plaintiff’s counsel summed up at length and with great force against the defendant upon those facts. That part of his summation occupies four pages of the record. Its prejudicial effect is manifest.
The Thomas matter is another such instance. There appears to be no substantial dispute about the facts — that is, as to what was really done by the bank in that matter, or, as I think, that defendant knew what was being done. At the closing of the former bank, Thomas owed it some $600,000, and upon the reorganization and opening of this bank there was, by the direction of the Banking Department, upon that asset charged off to profit and loss the sum of $247,549.16. In April, 1909, this bank and several other like institutions having liabilities of Thomas, entered into an agreement by which, in effect, they pooled their several such interests and the collateral which they respectively held thereon, and whereby Thomas agreed that a certain sum annually should be paid to his such creditors out of his income under a trust in his father’s will. The defendant in his testimony claimed that upon the accomplishment of
The third instance of the probably great prejudicial effect of
It is impossible within the compass of any practical opinion to review each of the eighty to ninety items of this class of evidence and submission. It may be that some of them will appear at a new trial to have some legitimate tendency to show defendant’s knowledge of the falsity of some specification included in the indictment, and if so such will be competent proof. For instance, if the report had contained a statement that the bills payable matured the coming December, and the published paper had said that they matured in June, six months earlier, and such was the fact, no doubt that paper would have been competent evidence to establish defendant’s then knowledge of the truth of the matter.
Moreover, many of those items may be competent evidence in proving that the items specified in the indictment were in fact included at their face values in the statements in the report, as is alleged in the indictment, but that did not make and cannot make competent evidence that those values were excessive or then known to the defendant to be excessive.
In addition to the foregoing discussed errors, which were both technical and substantial, I think that the trial court suffered the plaintiff’s counsel to exercise, at least to the very limit of propriety, the right of cross-examining the defendant upon collateral matters to impair his credibility as a witness. There is perhaps no other right of counsel in the conduct of a trial, which is more frequently abused than that. The trial judge, in the wise exercise of his discretion, should even of his own motion limit such inquiries to matters which by common understanding have a clear tendency to show moral turpitude upon the part of the defendant. Thus this court, some few years ago, held that such cross-examination, even in a civil case, should not be extended so far as to show that the defendant witness had been fined for violating an automobile speed ordinance. (See v. Wormser, 129 App. Div. 596.)
Such an act was his conduct in the Minuth matter. While president of the bank the defendant continued, as far as possible, his practice as a lawyer, and, therefore, his connection with his law firm. That firm had pending a civil action for a Mrs. Minuth, to recover damages, I infer, for personal injuries. She needed money and by defendant’s procurement borrowed one thousand five hundred dollars from the bank, giving for the loan her note with the written guaranty by defendant of its payment. The note became due July 15, 1909, but was not then paid. Defendant sent the note to his firm with directions to sue upon it, and the firm brought suit upon it in the name of the bank, against Mrs. Minuth. That action resulted in her assigning, March 29, 1910, a part of the judgment which she then had recovered in her action, and so the firm collected the money upon the note subsequently to the suspension of the bank and held it on account of a much larger sum due to the firm from the bank for other services. It appeared upon the cross-examination that in the outstanding bill of the firm against the bank there was a charge of fifty dollars for services in such action upon the note, and of eleven dollars and thirty-five cents for disbursements therein, but defendant denied any knowledge or information that the bill contained any such charge and disclaimed any intent that it should. The summation by plaintiff’s counsel upon the matter was most drastic. The counsel for the respondent, in their brief at page 83, go so far as to say in reference to it, “That before the trial was concluded any lingering respect for his [defendant’s] reliability as a witness was dissipated, plainly appears from the facts in connection with the Minuth matter.” For my part, I can see nothing in that matter justifying any adverse criticism whatever, and certainly nothing imputing moral baseness to the defendant. The situation in it is obvious. While
Another instance of excessive cross-examination appears in the matter of defendant’s own noté to the bank. His cross-examination revealed that the bank held his note for $800, with interest, given in February, 1909, and that the note was not paid by defendant until after the bank closed. After that day, and before the note was finally paid, defendant wrote a letter to the Deputy Superintendent in charge of the liquidation of the bank, claiming certain offsets to the note, and that letter, with the accompanying proof of such claim, was received in evidence, over defendant’s objection, as affecting his credibility. It is elementary that for such purpose it was incompetent for the plaintiff to introduce such evidence, other than by the cross-examination of the defendant. Plaintiff’s counsel in his summing up did not fail to comment upon this matter as one of “the things that count.” It seems most extreme to urge such a thing as of weight upon the trial of one for the serious crime of perjury. There was no doubt upon the evidence that the defendant was entirely good for many times the amount of the note, and the thing was, at the most, of very trivial importance, as compared with the weighty matters really involved in the case.
Another matter of very little import as reflecting upon defendant’s character was elicited by the cross-examination, and that was that sometime in 1909, when a few shares of the stock of the bank had been sold in a few small lots below par and much below their book value at one of the auction rooms in New York city, the defendant formed a pool with some other directors and people interested in the bank, he putting
Again, upon such cross-examination, and in such summing up, much was made of the fact that the defendant did not, within six months of the taking by the bank of any such stock, cause it to be sold at whatever price it might bring. Subdivision 8 of section 27 of the Banking Law declares that any bank having taken" any such stock shall sell or dispose of it within six months under a penalty of forfeiting to the People twice the nominal amount of such stock. The defendant, in extenuation of his such fault, pleaded that the Banking Department “ knew of the situation and they did not insist on our doing it [i. e., selling], and it was not feasible to do it.” Later in such cross-examination appears the following questions and answers:
“ Q. Did you take this bank stock or other bank stock over to the auction room for sale at any time between the time you took the Bogart stock and the time of the closing of the bank ? A. Why, certainly not. I try to ruin the bank by forcing this stock on the market ? It would have been a nice thing to do. Q. Notwithstanding that the law required it? A. Notwithstanding that the law required it, it would have been a fine thing to do.”
In short, the cross-examination of the defendant here, at least as to several matters, seems to have been extreme. I am strongly of the opinion that this right of cross-examination upon collateral matters, merely to discredit the defendant witness, is coming to be much abused, at least in criminal cases, and needs to be substantially restricted. Therefore, while I recognize that the practice must rest largely in the discretion of the trial court, and I would not feel warranted, in recommending a reversal here upon that ground alone, I have felt justified in discussing the matter at some length, especially as I am convinced that the defendant here was improperly prejudiced by the conduct of such cross-examination and the use made by plaintiff’s counsel of the collateral matters thereby elicited.
We have now come to the final question, whether or not the errors in the conduct of the trial, hereinbefore stated, are sufficient to require the reversal of the judgment and a new trial.
I am convinced that those errors in this case were so numerous, important and to the defendant so prejudicial, and that they so dominated the entire trial that the defendant did not have the fair trial which the Constitution and the laws guarantee to any indicted person. The matters involved in those • errors, having been by the rulings of the trial court in effect certified to the jury as competent and material, must by their combined weight have served to annihilate, or at least greatly .impair, with them, the credibility of the defendant as a witness, which manifestly was a very important element in the case,
The trial should have been confined to the items specified in the indictment and to the questions whether, as included in the report, they were false in fact and to the then knowledge of the defendant. The trial so limited could not have been over long and would have properly confined the attention of the jury to the real issues, and might have resulted in the opposite verdict.
No attempt is made here to review in detail the evidence as to any of the specifications, the submission of which to the jury is not herein discussed, as the said errors were so substantial, extensive and various in their character as of themselves to require a reversal and a new trial. It will be the duty of the justice presiding at the new trial, if one be had, to carefully weigh the evidence there given as to each such specification and determine its sufficiency or insufficiency for submission to the jury.
I advise, therefore, that the judgment of the County Court of Kings county be reversed, and that a new trial be granted in the Supreme Court, and to that end that the order remitting the indictment herein from that court to the County Court be reversed.
Concurrence Opinion
I concur, except that I am of the opinion that the defendant’s motion for a change of venue ought to have been granted
Judgment of conviction of the County Court of Kings county reversed, and new trial granted in the Supreme Court. Order made at the Kings County Special Term of the Supreme Court November 12, 1914, remitting the indictment to the County Court also reversed. Order made at the Special Term of the Supreme Court May 18, 1914, denying defendant’s motion to dismiss the indictment, and the order made at such Special Term March 15, 1915, denying defendant’s motion to change the venue, are each affirmed.
Concurrence Opinion
I concur fully in the opinion except as to the admissibility of the evidence concerning the due date of the bills payable inserted in the copy of the report, and as to the order denying the motion to change the venue I concur in the result.