Com. v. Bershad

• Citation: 693 A.2d 1303
• Parties: COMMONWEALTH of Pennsylvania v. Alan S. BERSHAD, Appellant.
• Decision Date: 16 June 1997
• Court: Superior Court of Pennsylvania

Page 1303

693 A.2d 1303

COMMONWEALTH of Pennsylvania v. Alan S. BERSHAD, Appellant.

Superior Court of Pennsylvania.

Argued Jan. 7, 1997.

Filed April 3, 1997.

Reargument Denied June 16, 1997.

James J. Kayer, Carlisle, for appellant.

George R. Zaiser, Deputy Attorney General, Strawberry Square, for Commonwealth, appellee.

Before CAVANAUGH, JOHNSON and EAKIN, JJ.

JOHNSON, Judge.

In this appeal, we are asked to determine whether subject matter jurisdiction and venue were properly established in Dauphin County where a defendant was convicted under section 3927(a) of the Crimes Code for failing to fulfill his obligation to remit taxes on another's behalf. We are also asked to consider whether section 3927(a) of the Crimes Code is unconstitutional. We find that subject matter jurisdiction and venue were proper in the locus of the defendant's failure to act. We also conclude that section 3927(a) is not unconstitutionally vague and that it does not unconstitutionally shift the burdens of proof, of persuasion, and of production to the defendant. Accordingly, we affirm.

The trial court succinctly summarized the facts as follows:

Alan Bershad was the Comptroller of Penn Triple S. He was responsible for preparing the sales tax returns for the company and for filing the return [and] remitting the tax on a monthly basis. The proceeds from cigarette vending machine sales received by Penn Triple S were subject to a 6% sales tax and returns were required to be filed and taxes paid to the Commonwealth of Pennsylvania, Department of Revenue on a monthly basis.

An audit conducted by the Department of Revenue for the period from May 1989 through June 1992 revealed that the monthly sales tax returns prepared on behalf of the corporation and paid to the Department of Revenue were underpaid by nearly $600,000.

During the same period of time, the other principals of the partnership discovered that Defendant had written certain checks to himself or to "cash" from the bank account of Penn Triple S and had listed the checks as a loan receivable. In June of 1992, [the] defendant informed the other principals of the partnership that he had gambled away the money withdrawn from the bank account at Triple S. Defendant then entered into an agreement (known as the Points Agreement) with his partners to sell certain of his assets to settle his obligations to the corporation for the amounts withdrawn from the bank. In essence, [the] defendant agreed to return to Penn Triple S the net proceeds after taxes of several assets which he owed [sic]. Defendant paid back to the corporation approximately $350,000 under the Points Agreement.

By the time of trial, approximately $270,000 of the total sales tax deficiency of $593,000 had been repaid to the Commonwealth of Pennsylvania leaving approximately $322,806.31 owing to the government. The restitution paid to the Commonwealth was paid through the corporation.

Trial Court Opinion, February 14, 1996, at 1-2.

In May of 1994, the Commonwealth filed a criminal complaint against Bershad. He was charged with thirty-three counts of theft because he failed to pay Penn Triple S's taxes to the Pennsylvania Department of Revenue. On October 17, 1994, Bershad submitted omnibus pretrial motions, which were denied.

On September 11, 1995, Bershad received a bench trial on stipulated facts. The trial court found Bershad guilty on all counts and imposed an aggregate sentence of two years and nine months to eight years' imprisonment. At the conclusion of the sentencing hearing, Bershad requested bail; that request was denied. He then filed post-sentence motions, which were also denied. Bershad now appeals.

On appeal, Bershad argues that: (1) the trial court did not have subject matter jurisdiction over this case; (2) venue was improper; (3) section 3927(a) of the Crimes Code is unconstitutional because it is vague both on its face and as applied to his case; (4) section 3927(a) is unconstitutional because it impermissibly shifts the burdens of proof, of persuasion, and of production to the defendant; (5) the Commonwealth is prohibited from prosecuting him under a general provision of the Pennsylvania Crimes Code because a provision of the Tax Reform Code provides criminal penalties for the same conduct; (6) the sentencing court failed to adequately consider mitigating factors and failed to impose an individualized sentence; (7) the trial court erroneously excluded relevant psychiatric evidence; and (8) the information failed to allege essential elements of the charged offense.

Bershad's first contention is that the trial court did not have subject matter jurisdiction over this case and that venue was improper in Dauphin County. Essentially, he argues that no conduct relevant to the charge of theft by failure to make required disposition of funds received, 18 Pa.C.S. § 3927(a), occurred in Dauphin County.

Theft by failure to make required disposition of funds received is defined as follows A person who obtains property upon agreement, or subject to a known legal obligation, to make specified payments or other disposition, whether from such property or its proceeds or from his own property to be reserved in equivalent amount, is guilty of theft if he intentionally deals with the property obtained as his own and fails to make the required payment or disposition. The foregoing applies notwithstanding that it may be impossible to identify particular property as belonging to the victim at the time of the failure of the actor to make the required payment or disposition.

18 Pa.C.S. § 3927(a). While section 3927(a) requires that the defendant "intentionally" deal with the property obtained as his own, see 18 Pa.C.S. § 302(d), the culpability required for the remaining elements is not prescribed by statute. Therefore, the remaining elements are established "if a person acts intentionally, knowingly or recklessly with respect" to the remaining elements. See 18 Pa.C.S. § 302(c). "The statute proscribing theft by the failure to make the required disposition of funds received was designed to require the actor to meet the obligation under which he undertook to collect monies or property of another." Commonwealth v. Wood, 432 Pa.Super. 183, 200, 637 A.2d 1335, 1344 (1994).

The locus of a crime is always in issue and a criminal court will have jurisdiction over a criminal case if some overt act involved in the crime, or a culpable failure to act, occurred within the county where the charges are brought. Commonwealth v. Boyle, 516 Pa. 105, 112, 532 A.2d 306, 309 (1987). In Boyle, our supreme court stated that:

A determination of the locus of a crime becomes more difficult when the crime consists of a failure to act. In determining the locus of a failure to act, it is necessary to consider the nature of the duty and that specific act which the defendant failed to perform. We must also look to the nature of the offense and the elements thereof to determine whether the crime was sufficiently related to the locus where the defendant is being prosecuted.

Boyle, supra, at 113, 532 A.2d at 310.

Contrary to Bershad's contentions that all of the alleged criminal conduct occurred in Bucks County, application of the above-discussed analysis to the instant case reveals that the crime Bershad was charged with is also sufficiently related to Dauphin County.

In Boyle, our supreme court addressed whether subject matter jurisdiction for a Tax Code offense existed in the county where the defendant's obligation to file and remit taxes occurred. Boyle, supra, at 111, 532 A.2d at 309. The Boyle court found that jurisdiction was proper where the acts giving rise to the obligation to file and remit taxes occurred. Id. at 113, 532 A.2d at 310. Significantly, the court also concluded that jurisdiction and venue to try crimes of omission were properly vested in the county where performance of the acts was due. Id. at 115, 532 A.2d at 311; Commonwealth v. Bennardo, 369 Pa.Super. 333, 336, 535 A.2d 185, 186 (1987) ("[N]o branch office has ever been designated as the office for filing [tax] returns, we find the trial court erred in transferring venue and jurisdiction from a locus where it admittedly properly lay (Dauphin County) to Allegheny County, based on the fact that a branch office existed there."). Thus, failure to file a tax return constitutes a failure to act in Dauphin County. See Boyle, supra; Bennardo, supra.

Here, as Penn Triple S's Comptroller, Bershad was required to collect sales taxes and remit this money to the Pennsylvania Department of Revenue. Although Bershad obtained the funds in Bucks County, the evidence indicates that Bershad failed to make the required disposition of these funds by not paying Penn Triple S's taxes to the Pennsylvania Department of Revenue, which is located in Dauphin County. Instead, he intentionally dealt with the funds as his own by gambling with the money. After considering the nature of Bershad's duty to Penn Triple S and the act which Bershad failed to perform, we find that the locus of Bershad's failure to act was Dauphin County. Boyle, supra; Wood, supra. Thus, both subject matter jurisdiction and venue are proper in Dauphin County.

Bershad's next argument is that section 3927(a) of the Crimes Code violates both the Pennsylvania and United States Constitutions because it is vague both on its face and as applied to his case. He also asserts that section 3927(a) is unconstitutional because it impermissibly shifts the burdens of proof, of persuasion, and of production from the Commonwealth to the defendant. Bershad's constitutional challenges all rest on the interpretation of the final sentence of section 3927(a): "The foregoing applies notwithstanding that it may be impossible to identify particular property as belonging to the victim at the time of the failure of the actor to make the required payment or disposition."

One who challenges the constitutionality of a statute has a heavy...