Cowl v. United States

• Decision Date: 07 October 1929
• Docket Number: No. 8294.,8294.
• Parties: COWL v. UNITED STATES.
• Court: U.S. Court of Appeals — Eighth Circuit

35 F.2d 794 (1929)

COWL v. UNITED STATES.

No. 8294.

Circuit Court of Appeals, Eighth Circuit.

October 7, 1929.

I. J. Dunn, of Omaha, Neb. (Ziegler & Dunn and G. W. Becker, all of Omaha, Neb., on the brief), for appellant.

George A. Keyser, Asst. U. S. Atty., of Omaha, Neb. (James C. Kinsler, U. S. Atty., of Omaha, Neb., Philip M. Aitken, Asst. U. S. Atty., of Lincoln, Neb., and Ambrose C. Epperson, Asst. U. S. Atty., of Omaha, Neb., on the brief), for the United States.

Before KENYON and VAN VALKENBURGH, Circuit Judges, and OTIS, District Judge.

KENYON, Circuit Judge.

Appellant with others was indicted for violation of sections 215 and 37 of the Criminal Code (18 USCA §§ 338, 88). He is the only defendant prosecuting an appeal, and will herein be designated as defendant.

The indictment contains fourteen counts. Counts 1 to 13, inclusive, were based on the alleged violation of section 215 of the Criminal Code (Title 18, section 338, USCA) by use of the mails for the purpose of carrying out a scheme to defraud in the sale of town lots. The alleged scheme is set forth in count 1. The fourteenth count charged defendant with entering into a conspiracy with divers other persons to commit an offense against the United States by devising a scheme (as set forth in count 1) to defraud, and within intent to execute the same by use of the United States mails. The court instructed a verdict of not guilty as to counts 1, 3, and 10. The jury returned a verdict of guilty on the other counts. Defendant was sentenced to one year and a day in the penitentiary, and fined $5,000 on the fourteenth count, and one year and a day on each of the other counts, all sentences to run concurrently. There are 72 assignments of error. Reliance is placed on some 23. There is no bill of exceptions. It is doubtful if any questions are before us, except those arising on the record proper. The court signed a certificate, which seems to have been regarded by it as in the nature of a bill of exceptions, and which was likewise so regarded by the government in its objections filed thereto. In the court's order overruling the objections of appellee thereto it is designated as a proposed bill of exceptions. It is something of an anomalous instrument, unknown to the practice or rules of this court, and, while it is doubtful if it is sufficient as a bill of exceptions, we have decided to consider the questions raised therein, except when based on the evidence. That is in no way before us. This eliminates a number of assignments of error. It is unnecessary to take up seriatim the numerous assignments of error. They are practically all based on the claimed inadequacy of the indictment, error in overruling motion for instructed verdict, refusal to give certain instructions, and the situation of the case as affected by the instructions of the court.

Defendant filed a special demurrer to the indictment, alleging it to be defective in certain particulars. The special demurrer is the same as to all counts, and the parts thereof here argued are subdivisions (b) and (c) of each division, which are as follows:

"(b) That said Count 1 of said information does not allege the value of said lot to be donated to said plaintiff, and fails to allege that the same was worthless or of no value.

"(c) That said Count 1 fails to allege that said larger lots were valueless and fails to allege the value of said larger lots."

Each assignment of error thereto is as follows:

"13. Because of error committed by the Court in overruling the Special Demurrer filed by the defendant, Harry H. Cowl, to the indictment, and to the insufficiency thereof, and to each of the counts therein as set forth in said Special Demurrer, to-wit:

"In overruling Paragraph (b) of said Special Demurrer to Count 1 of said indictment, that said Count 1 of said Indictment does not allege the value of said lot to be donated, and fails to allege that the same was worthless or of no value.

"In overruling Paragraph (c) of said Special Demurrer to said Count 1 of the Indictment, that said Count failed to allege that said larger lots were valueless, and failed to allege the value of said larger lots."

The other provisions of the demurrer relate to the allegations as to the mailing of letters and are not here questioned.

Appellant in argument goes far beyond the matters raised by the special demurrer and assigned as error, and assails many features of the indictment. In considering the special demurrer, we shall confine ourselves within bounds indicated by the assignments of error. We set forth the important parts of the indictment at this juncture. After the formal opening reciting the parties charged, it asserts:

"All of the above named persons hereinafter in this indictment called defendants, did devise a scheme or artifice to defraud and for obtaining money and other valuable things from a certain class of persons then resident in Nebraska, Iowa and various other states of the United States of America, hereinafter in this indictment called victims, by means of false, fraudulent and fictitious pretenses and representations, that is to say, the said defendants would, by the means hereinafter described, induce the said victims to give, send and pay their money and other valuable things to the said defendants under the name of the U. S. Suburban Home Developers, Inc. (a corporation, the business and affairs of which were then and there, and at the subsequent times hereinafter mentioned, under the management and control of the said defendants or some of them), for the purchase by deed or contract of lots in what was called by the defendants Lakoma or Lacoma Heights, which was located in and near the village of Ralston, Douglas County, Nebraska, upon pretense and representations to be made in the name of the said corporation to the said victims by the said defendants, either directly or through agents or representatives of the said corporation, by means of oral statements and of divers letters and printed prospectus or advertisements, to the effect that these defendants, or some of them, had formed a corporation for the purpose of developing three certain tracts of land which the said corporation had purchased in and near the village of Ralston, in Douglas County, Nebraska. * * * The development as the said defendants represented to the said victims was that Lakoma or Lacoma Heights was an established community with paved roads running through the property, street lights, electricity, telephone lines, that city water mains and sewers were laid to the property, that the company planned to build many residences on the said property, and that it was but a few blocks from Dundee, an exclusive residential section of the city of Omaha, Douglas County, Nebraska."

The indictment then describes, with additional averments as to the scheme, the manner in which the so-called victims were to be obtained, which, in brief, was to have agents at county fairs and other places, who were to "state that a lot would be given away free to some one of the persons who would place their name, address and other information upon small cards furnished by the defendants, or the agents or representatives of the said corporation, which would then be returned to the defendants, or the agents or representatives of the said corporation, and that from the cards so returned certain ones would be chosen as a recipient of a free lot, and that the persons so designated would be notified, either orally or by letter, that they had been selected to receive a lot free upon the payment of actual expense, such as abstract, record, deeds, notary fees, etc., which amount of actual expense was represented to be $59.00, and that said lot would be represented as of the value of approximately $250.00, that the intended victims would then be shown the lot which was located in a low place in the addition and was about 25 by 100 feet, some few lots that were shown being 25 by 132 feet, that the victims would then be shown other lots in the addition which were 50 feet by 120 feet and more favorably located, and that the value of which the defendants or agents or representatives of the corporation would represent to be of the value of $300.00 to $750.00, and the victim would be told by the defendants or the agents or representatives of the said corporation that upon the payment of the $59.00 actual expense a credit of $250.00 would be allowed the victim upon the purchase price of one of the larger lots, and the defendants personally, or through the agents or representatives of the said corporation would represent that they had good and lawful right and authority to give, sell, or otherwise dispose of, either by deed or contract, each and every lot in the said Lakoma or Lacoma Heights, which the said defendants would offer to sell, give or otherwise dispose of to one of the said victims."

The government, to establish the crime charged, was not compelled to allege or prove that the lots were worthless. The extent of damage to the purchasers was not an element of the alleged crime. If the scheme existed, as charged, to sell lots by false and fraudulent representations, then there was a scheme to defraud, even if the purchaser did not lose in the transaction. The use of the mails in a scheme to defraud was the offense, regardless of the damage, if any, to the purchaser of the lots.

In Wilson v. United States (C. C. A.) 190 F. 427, 433, the court said: "But whatever may be the rule in civil cases, we are satisfied that damage is not made an essential element of the federal statutory offense of using the mails to execute a scheme or artifice to defraud. We are of the opinion that a scheme or artifice is established by proof of false and fraudulent misrepresentations by which a person's right of open and fair dealing is invaded; that having shown that the defendants used false and fraudulent means to induce persons to part with their property and to...