Com. v. Steinberg

CourtSuperior Court of Pennsylvania
Writing for the CourtBefore WATKINS; JACOBS
Citation240 Pa.Super. 139,362 A.2d 379
Decision Date22 April 1976
PartiesCOMMONWEALTH of Pennsylvania v. Frank M. STEINBERG, Appellant.

Page 379

362 A.2d 379
240 Pa.Super. 139
COMMONWEALTH of Pennsylvania
Frank M. STEINBERG, Appellant.
Superior Court of Pennsylvania.
April 22, 1976.

Page 381

[240 Pa.Super. 142] Donald J. Goldberg, Philadelphia, for appellant.

S. [240 Pa.Super. 143] Emmett Fitzpatrick, Dist. Atty., Philadelphia, Steven H. Goldblatt, Asst. Dist. Atty., Chief, Appeals Div., [240 Pa.Super. 142] Deborah E. Glass, Asst. Dist. Atty., Philadelphia, for appellee.

Before WATKINS, President Judge, and JACOBS, CERCONE, PRICE and VAN der VOORT, JJ.

[240 Pa.Super. 143] JACOBS, Judge:

Appellant herein, Frank M. Steinberg, was brought to trial 1 before a jury on seven indictments charging him with various counts of misbehavior in office, conspiracy and deposit of public money for gain.

Page 382

These charges arose out of Mr. Steinberg's activity as, first a member, and later Chairman, of the Philadelphia Housing Authority. In this appeal he challenges his conviction on four of the indictments 2 raising a number of issues most of which question the sufficiency of the evidence, and the propriety of his conviction on the common law offense of misbehavior in office. We will affirm the judgments.

The four indictments which are the subject of this [240 Pa.Super. 144] appeal concern two separate series of incidents occurring after Frank Steinberg became a member of the Board of the Philadelphia Housing Authority on May 24, 1967. Three bills, number 879, 880 and 881, relate to appellant's alleged use of his office to obtain preferential treatment for his brother's construction firm. The remaining bill, number 883, concerns appellant's use of his influence to cause the deposit of Authority money in Citizens Bank.



Incident to proving the charges relating to favoritism of the firm of appellant's brother, Herman Steinberg, the Commonwealth established that when Frank Steinberg became a member of the Board of the Philadelphia Housing Authority, the major project in which the Authority was involved was the Used House Program. Under this program, developers, approved by the Authority, would locate houses in the City of Philadelphia suitable for the purposes of the Authority and restore them according to specified guidelines. In order to become an approved developer under the program, it was necessary for a prospective developer to make an application to the Authority. A questionnaire was filled out by the applicant which was circulated through the staff. The staff would determine the acceptability of the applicant and make its recommendation to the Board. The Board, relying on the advice of the staff, would then approve or disapprove the developer for work within the program.

When Mr. Steinberg became a member of the Board there were approximately 25 approved developers not all of which were active in the program. A much larger number of developers had applied for, but been denied, approval. One such applicant was Paul Cotler. Mr. Cotler had made at least two applications to the Authority prior [240 Pa.Super. 145] to the summer of 1967 but had always failed to obtain approval. Upon learning that appellant had become a member of the Board of the Authority, he determined to try again. A lunch was arranged to bring Mr. Steinberg and Mr. Cotler together, during which Mr. Cotler expressed his desires concerning the Redevelopment Authority. Appellant indicated that he might be of help in furthering Mr. Cotler's plans and suggested that Cotler talk to appellant's brother, Herman Steinberg, who also was interested in participating in the program. Cotler and Herman Steinberg then formed a company named Cotler Associates in which each had a one-half interest.

At a meeting of the Board on August 2, 1967, the matter of the appointment of new developers, a recurring theme at Board

Page 383

meetings, was raised. Appellant asked that Cotler Associates be appointed and produced the application of that company from his briefcase. The standard practice for handling applications by developers had been to attach a cover sheet to the questionnaire that the applicant had completed and circulate it to members of the staff who could properly evaluate it. 3 Notations of the results of each staff member's review would be recorded on the cover sheet. It would then be submitted to the Board for action based on the staff's recommendation.

When Cotler Associates's application was presented, no cover sheet was attached, indicating that it had not been circulated through the customary channels. The Director of Development, Mr. Emerson, who was present at the meeting, was asked for his comments on the proposed developer by Mr. Brown, the Authority Chairman at that time. Although he had not seen the application before, Emerson was familiar with Paul [240 Pa.Super. 146] Cotler due to his previous applications and he was able to comment on the individual, if not his company, after consulting his notes. His statements reflected the same criticism he had had of Cotler in the past: that the developer did not have much of a credit line to recommend him. Nevertheless Cotler Associates was approved as a developer by the Board on the basis of Mr. Steinberg's presentation. At no time was any mention made of appellant's brother, Herman Steinberg, and his association with the firm.

At the time Cotler Associates was approved as a developer in the Used House Program, each developer located its own properties to be rehabilitated on authority approval. This system was changed at the end of 1967, shortly after Frank Steinberg was elected Chairman, 4 in an effort by the Philadelphia Housing Authority to shift into a larger, more productive program. The Philadelphia Housing Development Corporation, a non-profit entity distinct from the Philadelphia Housing Authority, acquired properties suitable for rehabilitation which were turned over to the Authority. The Authority would then distribute them to the developers. When this method of property acquisition was instituted, the Director of Development and his staff recommended to the Board that the properties be distributed to the individual developer in proportion to the number of houses each had produced under the previous system. 5 After the meeting of the Board during which this suggestion was adopted, appellant spoke with the Director of Development in confidence, stating that [240 Pa.Super. 147] regardless how it was done he wanted his brother's firm to get the maximum allocation of properties. Cotler Associates had not completed a sufficient number of housing units under the previous system to allow it to be placed in the class receiving the highest allocation of building assignments, nor did its experience or proven capabilities in the program warrant such a placement.

In the spring of 1969 Cotler Associates was suspended from the program for doing inadequate wall work following an inspection by an engineering firm. Despite Cotler's failure to produce acceptable work, the firm continued to be assigned a substantial amount of repair and maintenance jobs within the program. 6 At no time did

Page 384

the Authority, or its Chairman, issue instructions that the suspended firm be denied further work within the program, although the fact that the firm had done a substandard job for the program was known.


The Commonwealth presented additional evidence to support its allegation that appellant had misused his position to benefit Citizens Bank in which he had an interest. It was shown that on May 9, 1968, Frank Steinberg was elected to the Board of Directors of Citizens Bank. He was at that time also the Chairman of the Board of the Philadelphia Housing Authority. On July 19, 1968, he became a shareholder in that bank with the purchase of 100 shares. He continued to purchase additional shares in the bank until May 14, 1969, when he began to sell his holdings. By May 22, 1969, he had divested himself of all his stock in Citizens Bank.

At a meeting of the Board of the Philadelphia Housing Authority on January 16, 1969, it was resolved [240 Pa.Super. 148] that the Authority's lead bank 7 would be changed from Provident National Bank to Citizens Bank. Provident National Bank had been the Authority's lead bank for 28 years and no reason was ever advanced to explain the change. The minutes of the meeting during which the resolution was passed indicated that appellant refrained from voting on the proposal but they also revealed that he failed to mention his interest in the bank. In addition, one witness, the Controller of the Housing Authority, testified that on at least two occasions appellant asked him to invest large sums of Authority money in Citizens Bank. On one occasion the amount of the suggested investment was $2,000,000.

Following a review of these incidents by the April 1969 Investigating Grand Jury, appellant was indicted and eventually tried in May 1972. In defense to all the charges against him, appellant presented a series of character witnesses who all testified to his good reputation as a law abiding citizen. He was found guilty on six indictments, four of which are the subject of this appeal. Indictments numbered 879 and 880 charge malfeasance, misfeasance and non-feasance in office for showing favoritism to Cotler Associates in the allocation of repair and maintenance work (Indictment No. 879) and in the allocation of properties to be rehabilitated (Indictment No. 880). Indictment No. 881 charges conspiracy to procure favored treatment for Cotler Associates between appellant, his brother, and Paul Cotler. The fourth bill, Indictment No. 883, charges malfeasance, misfeasance and nonfeasance in office in causing the deposit of Philadelphia Housing Authority funds in Citizens Bank. The appellant was sentenced to [240 Pa.Super. 149] pay a fine of $2,000.00 on each of bills 879, 880 and 883, and $500.00 on the conspiracy bill, 881, for a total fine of...

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12 cases
  • State v. Gunnison, 4853-PR
    • United States
    • Supreme Court of Arizona
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    ......Miley, 291 N.C. 431, 437, 230 S.E.2d 537, 541 (1976) ("unlawful concurrence * * * in a wicked scheme"); Commonwealth v. Steinberg, 240 Pa.Super. 139, 157-58, 362 A.2d 379, 389 (1976) ("common understanding * * * that the participants are joined together to perpetrate an unlawful ......
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    ......Steinberg, . Page 445 . 240 Pa.Super. 139, 156, 362 A.2d 379, 388 (1976). . II .         Cherpes next contends that the trial court erred in admitting the testimony of Laverne Cammarata and Charles Banks, associates of the Alexander & Alexander Insurance Agency, the agency which had previously ......
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    ...... proof constituted proof of misbehavior in office. . . [279. Pa.Super. 429] In Commonwealth v. Steinberg, 240. Pa.Super. 139, 149-50, 362 A.2d 379, 385 (1976), this court. discussed the nature and elements of the offense of. misbehavior in office, as ... breach of a positive statutory duty or the performance by a. public official of a discretionary act with an improper or. corrupt motive. Com. v. Peoples, 345 Pa. 576, 579,. 28 A.2d 792 ((1942)); McNair's Petition, 324 Pa. 48, 55,. 187 A. 498 ((1936))." Commonwealth v. Evans, supra. at ......
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    ...... conviction of misbehavior in office, this author believes. that the evidence was sufficient. See generally Commonwealth. v. Steinberg, 240 Pa.Super. 139, 362 A.2d 379 (1976);. Commonwealth v. Green, 205 Pa.Super. 539, 211 A.2d 5. (1965). . . . [ 2 ] This forgery concerned a ......
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