People v. Murphy

• Decision Date: 11 December 1973
• Docket Number: Cr. 5679
• Citation: 35 Cal.App.3d 905,111 Cal.Rptr. 295
• Court: California Court of Appeals Court of Appeals
• Parties: , Blue Sky L. Rep. P 71,130 The PEOPLE of the State of California, Plaintiff and Respondent, v. Richard R. MURPHY and Ralph K. Benware, Defendants and Appellants.

Page 295

111 Cal.Rptr. 295

35 Cal.App.3d 905, Blue Sky L. Rep. P 71,130

The PEOPLE of the State of California, Plaintiff and Respondent, v. Richard R. MURPHY and Ralph K. Benware, Defendants and Appellants.

Cr. 5679.

Court of Appeal, Fourth District, Division 2, California.

Dec. 11, 1973.

Hearing Denied Feb. 7, 1974.

Donahue, Katnik & Katnik and Arthur J. Donahue, Santa Ana, for defendant and appellant, Ralph K. Benware.

Richard R. Murphy in pro. per.

Evelle J. Younger, Atty. Gen., Edward A. Hinz, Jr., Chief Asst. Atty. Gen., William E. James, Asst. Atty. Gen., Harley D. Mayfield and Bernard A. Delaney, Jr., Deputy Attys. Gen., for plaintiff and respondent.

KERRIGAN, Acting Presiding Justice.

Murphy, an attorney, and Benware, an importer ('Appellants') were each convicted by a jury ¹ of five counts of illegally offering and selling security shares in violation of a stock permit issued by the Commissioner of Corporations, a felony. (Corp.Code, § 25540.)

Appellants applied for probation. Their applications were granted. Murphy was sentenced to nine months in the Orange County Jail on the five counts; the sentences were ordered to run concurrently; and the sentences were suspended for three years on condition Murphy pay a fine of California Caduceus Company (CCC') was incorporated in California in September 1968 by a group of doctors and the appellants. Their purpose was to enter the medical malpractice insurance field. Murphy performed the legal services necessary for incorporation. Murphy and Benware were two of the original corporate directors. Between November 1968--February 28, 1969, Murphy acted as attorney, secretary and director of CCC. He served as chairman of the board from March 1, 1969 to December 29, 1969. Benware was vice-president and director of CCC from December 1, 1968 to February 28, 1969 and from February 28, 1969 to December 29, 1969 was president and director.

$5,000 after the judgment became final. Benware was sentenced to six months in the county jail on the five counts; the sentences were ordered to run concurrently; and imposition of the sentences was suspended for three years on condition Benware pay a fine of $2,500 within six months after the judgment becomes final. The court further declared that the offenses were misdemeanors.

To gain a foothold in the malpractice insurance industry, CCC's directors decided in November 1968 to purchase an 88 1/2% Interest in Casualty Insurance Company of California ('Casualty') for $946,000. The acquisition was payable as follows: $100,000 on December 11, 1968, $15,000 on December 15, 1968, $235,000 on December 31, 1968 and the $596,000 balance on January 31, 1969. ² To finance the Casualty purchase, CCC's directors authorized Murphy to file an application for a permit to sell and issue 459 shares of CCC stock: 153 were to be sold for $1,000 per share; the remaining shares were to be sold to the initial shareholders for $1,000 per share on a 2--1 option basis.

Effective January 2, 1969, the Commissioner of Corporations issued an amended permit authorizing the sale and issuance of CCC securities to Medical doctors, dentist and pharmacists having a net worth of $50,000 exclusive of home, car and furnishings and to attorneys.

On June 2, 1969, the Commissioner of Corporations received an application for a curative permit from CCC. This application indicated that CCC shares had been sold to persons other than those designated in the January 2, 1969 amended permit. The application for the curative permit had been authorized by the CCC board of directors. Appellants were two of these directors. When it came to the commissioner's attention that CCC had violated the conditions of the amended permit effective January 2, 1969, the curative permit was never granted. To the contrary, criminal indictments were handed down against the appellants.

It is undisputed that CCC shares were sold to five purchasers, none of whom were medical doctors, dentists, pharmacists or attorneys. The five counts of which appellants were convicted show the following sales: (1) five shares ($5,000) to a trenching contractor; (2) five shares ($5,000) to a building contractor; (3) five shares ($5,000) to a teacher; (4) one share ($1,000) to a postal clerk; and (5) five shares ($5,000) to an airline pilot.

Evidence was introduced to the effect that none of the purchasers were ever queried about their respective occupations and none were advised as to any restrictions on the sale of stock. Similarly, no inquires were made as to the net worth of the purchasers. The certificates evidencing the shares were signed by both appellants.

CCC's certified public accountant testified that both appellants were present at board meetings at which the conditions and provisions of the amended permit were specifically discussed.

Appellants both admitted at trial that their signatures appeared on the stock certificates. Murphy testified he was familiar with the provisions of the amended permit and that he knew that at least three of the During the course of an 11-week trial, the appellants took the position that they sold the shares in good faith in order to acquire sufficient funds to complete CCC's acquisition of Casualty and that their efforts in negotiating the sale of the stock were to save CCC's assets from being plundered by a conspiratorial group composed of Congressman John Schmitz, Financier C. Arnholt Smith, the California Corporations Commissioner and the California Insurance Commissioner, all of whom were engaged in a plot either to destroy CCC or to take over its assets for themselves.

proposed purchasers were not doctors, dentists, pharmacists or attorneys.

Multiple issues are raised on appeal. In substance, appellants maintain that their convictions resulted from serious errors committed by the trial court, the prosecutor, and the jury. These issues will be considered in categorical order.

TRIAL CONTINUANCE

Appellants were indicted in December 1970. The case was scheduled for trial on November 22, 1971. Initially, Murphy and Benware were represented by Attorney Donahue. However, in August 1971, a purported conflict-in-interest arose between appellants, and Murphy began representing himself with Attorney Donahue continuing to represent Benware. On November 5, 1971, Attorney Donahue requested a continuance of the scheduled trial date of November 22 and the motion was denied by Judge Murray. On November 22, when the presiding judge called the matter for trial, appellants again moved for a continuance of the trial and the presiding judge denied the motion and the case was assigned to Judge Van Tatenhove. When appellants appeared in Judge Van Tatenhove's court, they renewed their motion for a continuance on the ground that Murphy desired to secure private counsel and that Attorney Aronson might undertake representation upon Murphy's behalf but would need 60--90 days in order to prepare for trial.

Judge Van Tatenhove allowed the parties to argue the matter extensively. The district attorney opposed a continuance on the grounds that there had been numerous continuances of pretrial matters since the return of the indictments eleven months earlier; that Murphy had discovered the purported conflict during the summer months and had at least 90 days or more to obtain counsel; that Attorney Aronson's affidavit indicated that he would require at least 30 days to determine whether he would be willing to undertake representation of Murphy; and that the prosecution had subpoenaed a large number of witnesses and was ready for trial.

The trial judge denied the motion on the grounds that Murphy had not been diligent in his efforts to obtain counsel; that any further delay would be disruptive of the efficient administration of justice; and that it was merely speculative whether Attorney Aronson would even enter the case.

Appellants argue that Murphy was denied his right to counsel and that the trial court abused its discretion in denying the motion.

1] In criminal prosecutions, the accused shall have the right to appear and defend in person and with counsel. (Cal.Const., art. I, § 13.) A defendant who is himself a lawyer enjoys the right to counsel. (People v. Napthaly, 105 Cal. 641, 645, 39 P. 29; Bogart v. Superior Court, 60 Cal.2d 436, 440, 34 Cal.Rptr. 850, 386 P.2d 474.)

'2] A defendant has no absolute right to be represented by a particular attorney; however, the courts should make a reasonable effort to insure that a defendant financially able to retain an attorney of his own choice can be represented by that attorney. (Citation.) A defendant's desire to be represented by counsel of his own choice can constitutionally be forced to yield only where it will result in significant prejudice to the defendant himself, or in a disruption of the ordinary process of justice unreasonable under the circumstances of the particular case. (Citation.)

The burden is on the defendant to establish an abuse of discretion in denying his request for change of counsel and, unless there has been a miscarriage of justice, a reviewing court will not substitute its opinion and thereby divest the trial court of its discretionary power. (Citation.) ( ) The matter of continuance to obtain counsel is traditionally within the discretion of the trial court, and it is not every denial of a request for more time that violates due process even if the party . . . is compelled to defend without counsel; . . . Due process is not denied every defendant who is refused the right to defend himself by means of his chosen retained counsel; other factors, including the speedy disposition of criminal charges, demand recognition, particularly where defendant is inexcusably dilatory in securing legal representation. (Citation.)' (People v. Brady, 275 Cal.App.2d 984, 992--993, 80 Cal.Rptr. 418, 423; see also People v. Johnson, 5 Cal.App.3d 851, 858, 85 Cal.Rptr. 485; People v. Byoune, 65 Cal.2d 345, 346, 54...