190 Wis. 257 | Wis. | 1926
The defendant is charged in the information with embezzlement of $2,000 on November 4, 1922, being the amount paid to the company on that date, upon the theory that this sum was paid to the company, and that Weber, as secretary and treasurer of the company, received it, deposited it to the credit of the company on its open checking account in a Sheboygan bank, and that thereafter he caused it to be checked out for the benefit of the company in the regular course of its business.
Weber at the time of the trial was twenty-seven years of age. He first became connected with the company in 1916, and was employed as a stenographer and as office help. In recognition of his ability and industry he was promoted from time to time, and in March, 1922, became the secretary and treasurer of the company, having special charge of the loaning and investment business. For his services as such secretary and treasurer he was paid a salary of $150 per month, and with the exception of such salary his interest in the business was merely nominal: His reputation, as disclosed by numerous prominent business men from Sheboygan who testified as character witnesses, was beyond reproach, and this reputation so established was not assailed' or deprecated by an iota of testimony of the State. In November, 1922, he was an officer of the company, but' while he held the office of sécretary and treasurer he acted moré in the capacity óf a salaried employee. Ordinarily, an officer of such high rank in a corporation is the owner óf a substantial amount of 'the stock of the same. It was not so with the defendant. But,
Sec. 4418 of the Statutes is known as the embezzlement statute, and in its broad and comprehensive language covers substantially the entire field of embezzlement. Embezzlement was not known to the common law, and the crime is of statutory origin. As defined in statutes generally, and particularly by sec. 4418 of our Statutes, it involves a violation of a trust or fiduciary relationship. On November 4, 1922, the defendant, as an officer of the company, under the provisions of the statutes, occupied a position of trust in the company, and as to the company he was a fiduciary. Any fraudulent misappropriation of the assets of the company, either for his own benefit or for the benefit of others, would constitute an embezzlement. The defendant occupied no fiduciary relationship to Failley and was not the agent of the latter. Had he acted as the agent of Failley, such act might be incompatible with the duty that he owed the company. This was recognized by both Prescott and Failley, for when the agreement of November 4, 1922, was executed it was not signed by Weber individually, but by the company through Weber as its secretary and treasurer. If an agency was created at that time the company was constituted the agent, and not the defendant. No motive existed for the conversion of Failley’s money to the benefit of the company, for the reason that the only interest the defendant had in the company consisted in the monthly salary that was paid him. Under these facts and circumstances it is difficult to perceive how the defendant could be held to have violated a trust relationship to Failley wffiich under the provisions of sec. 4418 of. the Statutes would constitute embezzlement.
The defendant was not charged in the information, nor was he convicted by the jury, of embezzling the property
In' the Milbrath Case, Milbrath was the owner of $24,000 of the capital stock of the company, and his codefendant, Wagnei, owned $6,000 of the stock. When the mortgage debtor, Kafura, paid his debt to Wagner in the presence of Milbrath, the liabilities of the corporation largely ex
“If the defendant and Wagner chose to make this insolvent corporation, in which they were the solé and controlling stockholders and of which they were officers, the repository of trust funds collected by them, it had no other effect in the law than if they delivered such funds into the possession of any trustee or subordinate employee controlled by them, whose possession must be deemed their possession and whose acquisition must be deemed their acquisition. The corporation is in such case a mere instrumentality through and by means of which the natural persons in control thereof carry out their acts.”
In speaking of the money of the creditor paid into the corporation the opinion continues':
“It is paid into that which is a mere instrumentality created by him under sanction of law, but as much under his control and as subservient to his will as the furniture of his office or the books of account in which he records his transactions. Under such circumstances there is no room for the legal fiction of separate corporate personality or for distinction between the defendant’s acts as officer of the corporation arid his acts as an independent natural person.”
The distinction between the facts in the Milbrath Case and the instant case is apparent and need be the subject of
In the instant case, Weber, as a stockholder, had but a nominal interest in the corporation. He did not control the corporation or the board of directors. Misappropriation of the moneys derived from Failley did not advance his personal interests. While an officer in name, he served the corporation in fact as a mere employee. In the instant case there is not even an intimation in the record that the company was insolvent when it received the $2,000 from Failley. It was a going concern, and not only met, in due course of business, the claims of its creditors, but had advanced thousands of dollars to local investors in Western mortgages negotiated by it, for the payment of defaulted interest. It held and maintained the confidence of the general public; besides, there is no evidence in the case to show that the defendant had overdrawn his account for even a penny. Under these circumstances it is diffi
We have gone over the record in this case thoroughly and considered it carefully. Aside from what has been heretofore said, even assuming that the act charged and complained of could in law constitute an embezzlement, nevertheless the agreement above set forth and the testimony of Prescott are so involved in entanglements and uncertainties as to create in our minds more than a robust, reasonable doubt of the guilt of the defendant.
We could devote many pages in extending this opinion, upon the misconceptions of Mr. Prescott as shown by his testimony, but no useful purpose will be served thereby. We will content ourselves by expressing the conclusion that the motion of the defendant at the close of his testimony, for his discharge, should have been granted.
By the Court. — The judgment and sentence of the lower court is reversed, and the cause is remanded with directions to discharge the defendant.