Amana Soc. v. Selzer

• Decision Date: 13 January 1959
• Docket Number: No. 49541,49541
• Citation: 94 N.W.2d 337,250 Iowa 380
• Parties: AMANA SOCIETY, a Corporation, Appellant, v. George H. SELZER, Appellee.
• Court: Iowa Supreme Court

Page 337

94 N.W.2d 337

250 Iowa 380

AMANA SOCIETY, a Corporation, Appellant, v. George H. SELZER, Appellee.

No. 49541.

Supreme Court of Iowa.

Jan. 13, 1959.

David G. Bleakley, of Bleakley & Terpstra, Cedar Rapids, for appellant.

Edward Von Hoene, Williamsburg, and Messer, Hamilton & Cahill, Iowa City, for appellee.

GARFIELD, Justice.

Plaintiff, a corporation for profit, brought this action in equity for an accounting against a former purchasing agent of plaintiff. Paragraph 4 of defendant's answer as amended, by way of special defense to paragraph 7 of plaintiff's petition, states the information sought from defendant would tend to incriminate him or expose him to public ignominy in violation of rights against self-incrimination guaranteed him by section 622.14, Code 1954, I.C.A., and the due process provisions of the state and federal constitutions, Section 9, Article I, Iowa Constitution, I.C.A.; Section 1, 14th Amendment, U.S. Constitution.

Plaintiff's reply attacks as insufficient the part of defendant's answer referred to but the trial court upheld it in adjudicating law points under rule 105, Rules of Civil Procedure. We granted plaintiff this appeal, under rule 332, R.C.P., 58 I.C.A., from the ruling.

Defendant challenges our order granting the appeal upon a ground urged by him but rejected by us when the appeal was allowed. We are not disposed, upon the same ground, to dismiss the appeal now after it has been submitted pursuant to the order granting it.

Plaintiff's petition alleges defendant was manager and purchasing agent of its feed mill from September 21, 1940, to May 3, 1955. Paragraph 7 states that between these dates defendant surreptitiously, without plaintiff's knowledge or consent, entered into clandestine and secret arrangements with persons, firms and corporations whose names are unknown to plaintiff, who sold it feeds and other products, whereby the sellers paid defendant moneys in amounts unknown to plaintiff in excess of $20,000 as inducements to defendant to purchase the feeds and other products; defendant retained and never accounted for this money.

Paragraph 8 of the petition alleges that on May 10, 1955, plaintiff demanded an accounting of defendant for the moneys so received by him but he has refused to make such accounting or pay over the money. Part of the prayer is that defendant be required to make a full accounting and that plaintiff have judgment for sums found to be due.

Defendant's answer admits he was manager and purchasing agent of plaintiff's feed mill from September 21, 1940, to May 3, 1955, and admits paragraph 8 of the petition. Paragraph 4 of the answer as amended, by way of special defense to paragraph 7 of the petition, states plaintiff is alleging this defendant entered into an illegal contract with certain suppliers to which plaintiff was not a party and he cannot be compelled to answer these allegations because of his privilege against self-incrimination to which we have referred.

Division II of the answer states that if defendant received the inducements or tips as alleged in the petition the payments would be illegal under Code section 741.1, I.C.A.

Plaintiff's reply to defendant's answer raises certain points of law, among them that any answer required of defendant to paragraph 7 of plaintiff's petition would not be admissible in a criminal action against defendant and that the allegations of paragraph 7, not having been denied, should be deemed admitted as provided by rule 102, R.C.P.

Pursuant to plaintiff's application to hear and determine the law points raised by its reply the trial court heard them and determined that plaintiff cannot establish its right to recover upon a pleading or testimony of defendant that might tend to incriminate him or expose him to public ignominy; defendant is not compelled to answer further any allegations of paragraph 7 of the petition; these allegations, if true, possibly would constitute a crime under Code section 741.1, I.C.A.; Code section 741.3, I.C.A., does not apply in this civil action but by implication to criminal cases only. The court did not rule upon the point urged by plaintiff that its paragraph 7, not having been denied, should be deemed admitted as provided by rule 102. It is from this ruling on law points that we granted the appeal.

I. Unlike most states there is no provision in the Iowa constitution similar to the one in the fifth amendment to the federal constitution that no person shall be compelled in any criminal case to be a witness against himself. This amendment applies only to the federal, not the state, courts. Koenck v. Cooney, 244 Iowa 153, 156, 157, 55 N.W.2d 269, 271, and citations; State v. Benson, 230 Iowa 1168, 1172, 300 N.W. 275, 277; 98 C.J.S. Witnesses § 432; 58 Am.Jur., Witnesses, section 36, page 44.

The absence from our state constitution of a provision against self-incrimination seems unimportant in view of our previous decision that compulsory self-incrimination is a violation of the due process clause of section 9, Article I, of our constitution. State v. Height, 117 Iowa 650, 659, 91 N.W. 935, 59 L.R.A. 437, 94 Am.St.Rep. 323. Koenck v. Cooney, supra, at page 157 of 244 Iowa, at page 271 of 55 N.W.2d, cites the Height case on this point.

We may note there are a number of decisions from other jurisdictions that the privilege against self-incrimination is not included in the conception of due process. 16A C.J.S. Constitutional Law § 589, page 651, and cases cited notes 45 and 45.5.

In any event Code section 622.14, I.C.A. states: 'When the matter sought to be elicited would tend to render a witness criminally liable, or to expose him to public ignominy, he is not compelled to answer, except as otherwise provided.'

II. It seems well settled that a defendant cannot be required by his answer to a pleading to state facts which will tend to criminate him since the answer may be read in evidence as an admission upon the trial. People ex rel. Moll v. Danziger, 238 Mich. 39, 213 N.W. 448, 52 A.L.R. 136, and Annotation 143; 98 C.J.S. Witnesses § 433, page 246; 58 Am.Jur., Witnesses, section 45, page 50.

However, the privilege against self-incrimination may not be claimed by one to whom there has been extended by a valid statute complete immunity from prosecution for any offense to which the evidence relates. Such a person may be compelled to furnish evidence although it may incriminate him. It is sometimes said the full immunity thus extended is regarded as equivalent to the protection against self-incrimination. Koenck v. Cooney, supra, 244 Iowa 153, 157, 55 N.W.2d 269, 271, and citation; Brown v. Walker, 161 U.S. 591, 16 S.Ct. 644, 40 L.Ed. 819; Halpin v. Scotti, 415 Ill. 104, 112 N.E.2d 91, 93, and citations; Ross v. Crane, 291 Mass. 28, 195 N.E. 884, 886; Annotations 27 A.L.R. 139, 141, 118 A.L.R. 602, 619; 98 C.J.S. Witnesses § 439; 58 Am.Jur., Witnesses, section 86.

It is also generally held where prosecution for the criminal act which would be disclosed is shown to be barred by the statute of limitations the privilege against self-incrimination does not apply. Hale v. Henkel, 201 U.S. 43, 67, 26 S.Ct. 370, 50 L.Ed. 652, 663; Moore v. Backus, 7 Cir., 78 F.2d 571, 101 A.L.R. 379, 387, 388, certiorari denied 296 U.S. 640, 56 S.Ct. 173, 80 L.Ed. 455; Jonitz v. Jonitz, 25 N.J.Super. 544, 96 A.2d 782, 786; 8 Wigmore on Evidence, 3d Ed., section 2279; 98 C.J.S. Witnesses § 438; 58 Am.Jur., Witnesses, section 84.

III. The principal statute defendant claims he is accused of violating is Code section 741.1, I.C.A. which provides: 'It shall be unlawful for any agent, representative, or employee, * * * of a private corporation, * * * acting in behalf of a principal in any business transaction, to receive, for his own use, directly or indirectly, any gift, commission, discount, bonus, or gratuity connected with, relating to, or growing out of such business transaction; * * *.' Section 741.2 makes violation of 741.1 a misdemeanor.

We must agree with defendant that the facts alleged in paragraph 7 of the petition probably constitute a violation of section 741.1 which defendant is not required to admit in his answer unless he is granted full immunity from prosecution for any offense to which the admitted facts relate to unless it is shown such prosecution is barred by the statute of limitations.

Plaintiff does not argue it has been shown that prosecution for any offense growing out of the matters alleged in its paragraph 7 is barred by the statute of limitations although any such offense must have been committed not later than May 10, 1955. The statutory period is three years after commission of the offense. Code section 752.3, I.C.A. And defendant's answer admits he is now and was at all times mentioned in the petition a resident of Iowa. Since plaintiff does not argue the point now referred to we do not base a reversal thereon. We may observe, however, that unless a criminal prosecution was commenced against defendant on or before May 10, 1958, his fear of self-incrimination seems groundless.

Plaintiff does contend sections 741.3, 741.4 grant defendant full immunity from prosecution for any offense growing out of the facts alleged in paragraph 7. These statutes provide:

'741.3. Testimony tending to incriminate. No person shall be excused from attending, testifying, or producing books, papers, contracts, agreements, and documents before any court in obedience to the subpoena of any court having jurisdiction of the misdemeanor on the ground or for the reason that the testimony or evidence, documentary or otherwise, required of him, may tend to incriminate him or subject him to a penalty or forfeiture.

'741.4. Immunity from prosecution. No person shall be liable to any criminal prosecution, for or on account of any transaction, matter, or thing concerning which he may testify or produce evidence, documentary or otherwise, before said court or in obedience to its...