Post v. United States

• Decision Date: 15 October 1968
• Docket Number: No. 20861-20863.,20861-20863.
• Citation: 407 F.2d 319
• Parties: Troy V. POST, Jr., Appellant, v. UNITED STATES of America, Appellee. Bill M. ALLEN, Appellant, v. UNITED STATES of America, Appellee. Leroy W. PICKETT, Appellant, v. UNITED STATES of America, Appellee.
• Court: U.S. Court of Appeals — District of Columbia Circuit

407 F.2d 319 (1969)

Troy V. POST, Jr., Appellant, v. UNITED STATES of America, Appellee.

Bill M. ALLEN, Appellant, v. UNITED STATES of America, Appellee.

Leroy W. PICKETT, Appellant, v. UNITED STATES of America, Appellee.

Nos. 20861-20863.

United States Court of Appeals District of Columbia Circuit.

Argued December 5, 1967.

Decided October 15, 1968.

Certiorari Denied February 24, 1969.

Mr. Raymond W. Bergan, Washington, D. C., with whom Mr. Thomas R. Dyson, Jr., Washington, D. C., was on the brief, for appellants.

Mr. Roger A. Pauley, Atty., Department of Justice, of the bar of the Court of Appeals of New York, pro hac vice, by special leave of court, with whom Messrs. David G. Bress, U. S. Atty., and Frank Q. Nebeker, Asst. U. S. Atty., were on the brief, for appellee. Mr. Scott R. Schoenfeld, Asst. U. S. Atty., also entered an appearance for appellee.

Before FAHY, Senior Circuit Judge, and WRIGHT and ROBINSON, Circuit Judges.

Certiorari Denied February 24, 1969. See 89 S.Ct. 863.

SPOTTSWOOD W. ROBINSON, III, Circuit Judge:

Appellants were convicted by a jury of conspiracy¹ and mail fraud² stemming from their activities in the promotion of Lakewood Country Club, in the area of Rockville, Maryland, and the concomitant sale of memberships therein. On these appeals, they allege error in three rulings by which evidence was excluded as irrelevant to their efforts to show their good faith in transactions impugned by the indictment. They also attack an instruction which defined for the jury appellants' criminal liabilities as promoters of the club. Two additional contentions which they advance are effectively foreclosed by decisions rendered subsequent to their trial.³

In the summer of 1958, appellants conceived the blueprint for a new country club to be developed in the vicinity of Washington.⁴ Locating a suitable site in 1959, they organized four corporations through which the club was to be established and operated,⁵ and embarked upon the promotional phase from which emanated the events giving rise to the indictment. An advisory board, generally nonfunctional, of well known citizens was organized, a sales office was opened and a sales staff hired, and a thoroughgoing campaign for members was launched. There was extensive newspaper advertising, and tens of thousands of direct mail advertisements were sent to area residents. The promotional literature was issued under the apparent auspices of the advisory board, and appellants' names were omitted.

Opportunities for affiliation with the incipient club assumed the form of $1,000 life memberships and $300 regular memberships, and the distinctive characteristics of each were publicly proclaimed. Life members would be immunized from all dues, assessments and minimum spending requirements, but regular members would be required to pay monthly dues. Life memberships would also be in "limited number;" applicants therefor were told that their ratio to others would be about one in ten, and the maximum number was variously fixed between 100 and 300. By October 1, 1960, however, 1,124 life memberships had been sold, as compared with only 719 regular memberships, and the club's bylaws, when distributed, authorized the directors — appellants' appointees — to impose a minimum spending requirement upon all members irrespective of class.⁶

Appellants' promotional crusade met instant and spectacular success, garnering membership fees aggregating more than $1,250,000.⁷ While membership solicitations continued unabatedly, construction of the club's facilities got under way, and proved to be a lucrative enterprise for appellants. Acting through their wholly-owned corporations,⁸ they turned handsome profits on a land lease to the club⁹ and on contracts for the construction of its facilities.¹⁰ They were also paid more than $200,000 during a 20-month period in salaries, commissions and fees pursuant to a variety of intracorporate arrangements. In addition, they advanced from the monies collected for initiation fees large sums to other country clubs in which they were financially interested.¹¹ The evidence warranted the conclusion that Lakewood's membership, actual and potential, remained unaware of appellants' proprietary stake in the country club complex and the extent to which they were profiting from it.

By the fall of 1960, the club's funds were exhausted, and construction on its clubhouse came to a halt.¹² A membership meeting in December culminated in the election of a new board of directors, which during the next several months endeavored unsuccessfully to negotiate an accord with appellants. Finally, in March, 1961, suit was filed in the District Court for the District of Columbia seeking a conservatorship, the ouster of appellants, and the recapture of monies claimed to have been wrongfully diverted.¹³ On March 31, 1961, a conservator was appointed for all of the corporations involved in the affair, and appellants were prohibited from further operation of the club. Thereafter, in February, 1962, the litigation was settled by a consent order.¹⁴

The indictment leading to appellants' convictions charged, in substance, material misrepresentation associated with the sale of memberships, including the use of the names of the advisory committee members, the statements as to the "limited number" of life memberships and their nonassessable character, and the nondisclosure of appellants' interests in and their profiteering from the club. At the trial, the core question was whether Lakewood Country Club was, as the Government contended, a scheme to defraud prospective members or was, as appellants insisted, a legitimate business venture that unexpectedly and unfortunately failed. Appellants concede that the record contains evidence which amply supports the jury's verdicts.¹⁵ They urge, however, that by virtue of the three exclusionary rulings, the jury was precluded from hearing evidence critical to their defense, and that, in consequence of the instruction under assault, was inadequately informed as to the Government's burden of proof and the criminal intent prerequisite to conviction. With these contentions we do not agree, and we accordingly affirm the convictions.

I

We approach our review, against the factual backdrop summarized, of the three exclusionary rulings advertent to familiar admonitions validated by generations of judicial experience. "It is for ordinary minds," we are instructed, "not for psychoanalysts, that our rules of evidence are framed. They have their source very often in considerations of administrative convenience, of practical expediency, and not in rules of logic."¹⁶ Not the least of the evidentiary principles so shaped are those by which the relevance of proffered evidence is to be measured.

An inevitable concomitant of the Anglo-American legal system, with its sharp distinction in function between judge and jury, is "the rough and practical quality * * * noticeable in the whole law of probative value."¹⁷ This is because "the Court will of course allow to be considered only such evidence as is worth submitting to men who will judge only by the most common and practicable tests."¹⁸ As an even more significant consequence, "the effect is to require a generally higher degree of probative value for all evidence to be submitted to a jury than would be asked in ordinary reasoning."¹⁹ For "the Judge, in his efforts to prevent the jury from being satisfied by matters of slight value, capable of being exaggerated by prejudice and hasty reasoning, has constantly seen fit to exclude matter which does not rise to a clearly sufficient degree of value."²⁰

These factors, in turn, define broadly the dissimilar roles trial and appellate judges play in scrutinizing evidence the pertinence of which is in issue. "It is the duty of the trial judge," we have declared, "to determine relevancy in terms of the worth of the proffer. `Each single piece of evidence must have a plus value,' something more than a minimum in a probative sense."²¹ Just how much more is a determination which by its very nature, of course, exacts a careful and often difficult estimate in the context of all else that the trial involves. The very considerations that condition a criminal conviction upon incriminating proof beyond a reasonable doubt entitle the accused to ample latitude in evidentiary presentations from which such a doubt might fairly arise. On the other hand, the possibilities of confusion and false deduction from circumstances of nebulous significance are real dangers that cannot be casually ignored. Trial judges, occupying an excellent vantage point, must be afforded leeway in striking the balance,²² a most delicate task when, as in the case at bar, the operations of the human mind are to be probed.²³

Appellate judges, on the other hand, must accord to trial rulings on relevance a respect commensurate with the occasion.²⁴ "There is no bright line that divides evidence worthy of consideration by a jury, although subject to heavy counterattack, from evidence that is not,"²⁵ and we are not unmindful of "the inescapable remoteness of appellate review."²⁶ With these twin handicaps, we perform our reviewing function both carefully and deferentially lest "the perspective of the living trial is lost in the search for error in a dead record."²⁷ When the issue is close, relevance is primarily for the trial judge to gauge,²⁸ and we will not lightly overrule his considered judgment.²⁹

II

In opposition to the Government's charge of conspiratorial and fraudulent conduct, appellants maintained that their constant aim was to provide the Lakewood members with all that had been promised. To support that claim, appellants were permitted to introduce evidence tending to show efforts, after as well as before the conservator's appointment, to extricate the club from its financial difficulties. On the same theory — relevance to good faith — appellants proffered a post-conservatorship proposition...