Commonwealth v. Jacobs

• Decision Date: 01 October 1907
• Citation: 126 Ky. 536,104 S.W. 345
• Parties: COMMONWEALTH v. JACOBS.
• Court: Kentucky Court of Appeals

104 S.W. 345

126 Ky. 536

COMMONWEALTH v. JACOBS.

Court of Appeals of Kentucky.

October 1, 1907

Appeal from Circuit Court, Jefferson County, Criminal Branch.

"To be officially reported."

Samuel T. Jacobs was indicted for embezzlement. From a judgment for him rendered on the court peremptorily instructing the jury to find him not guilty, the commonwealth appeals. Reversed.

N. B Hays, Atty. Gen., James Quarles, C. H. Morris, J. M Huffaker, and Loraine Mix, for the Commonwealth.

Earl &amp Hubbard, for appellee.

HOBSON J.

Samuel T. Jacobs was employed by the Western & Southern Life Insurance Company, a corporation with headquarters at Cincinnati, as an agent to solicit insurance and collect the premiums. The contract between Jacobs and the company, among other things, contained this provision as to the duty of Jacobs: "To keep true records of the business in the books provided by the company, and to account for and remit to the chief office, in Cincinnati, Ohio, or to the superintendent, as instructed, every week, on the day and in the manner required, all money received by me during the week." It was also in the contract that Jacobs should receive as "salary 15 per cent. of the amount actually collected each week and paid to the company." Jacobs collected from a number of policy holders money for the company, which he failed to pay over. He sent in his collection book by messenger, saying that the book was all he could send. Although the contract provided that his compensation should be 15 per cent. commission on the amount collected by him and paid over to the company, the uniform mode of doing business was for him to retain his 15 per cent. any pay over the balance to the company. He was indicted for embezzlement under section 1202, Ky. St. 1903, which is as follows: "If any officer, agent, clerk or servant of any bank or corporation shall embezzle, or fraudulently convert to his own use or the use of another, bullion, money, bank notes, or any effects or property belonging to such bank or corporation, or other corporation or any person, which shall have come to his possession or been placed in his care or under his management as such officer, agent, clerk, or servant, he and the person to whose use the same was fraudulently converted, if he assented thereto, shall be confined in the penitentiary not less than one and not more than ten years." On the trial of the case, the facts above stated were proved by a number of witnesses. At the conclusion of the evidence for the commonwealth, the court peremptorily instructed the jury to find the defendant not guilty. This was done, and the commonwealth appeals.

The ruling of the court was based upon the idea that, as Jacobs was entitled to 15 per cent. of the money, he was not guilty of embezzlement in using it. It will be observed that by the contract his compensation was to be 15 per cent. of the amount collected by him and paid over to the company. Under the contract, it was his duty to pay the whole fund over to the company, but no one can complain of that which he consented to, and, as the company consented to his taking out the 15 per cent. and paying over the 85 per cent. to it, it cannot complain of his taking out the 15 per cent. and he was guilty of no embezzlement in using the 15 per cent. But the right to use the 15 per cent. gave him no right to use the 85 per cent. The whole fund belonged to the company. It was in his hands as agent of the company. The fact that the company to avoid circuity, allowed him to retain the 15 per cent., instead of having him pay over the whole fund to it, and for it then to return to him the 15 per cent. in no way affected the substance of the transaction. The fund was in his hands as agent of the company. He had no right to use out of the fund anything more than 15 per cent., and when he used the entire fund he converted to his own use the money of the company which had come into his possession as its agent. The rule was so announced in Clark v. Commonwealth, 97 Ky. 76, 29 S.W. 973. In the subsequent case in Stone v. Commonwealth, 104 Ky. 220, 46 S.W. 721, 84 Am.St.Rep. 452, the decision of the court rests on the ground that Stone was not the agent of the corporation and did not hold the money as its agent. The quotation in the opinion from the Encyclopedia of Law, as to the rule applicable where the agent is entitled to commission, was used only as a matter of argument, and related to a subject not...