Cox v. State
| Decision Date | 21 November 1978 |
| Docket Number | 6 Div. 539 |
| Parties | John M. COX v. STATE. |
| Court | Alabama Court of Criminal Appeals |
Roger A. Brown, of McDonald, Brown & Tipler, Birmingham, for appellant.
William J. Baxley, Atty. Gen., and Larry R. Newman, Asst. Atty. Gen., for the State.
The appellant was indicated and convicted of a violation of Section 177(2) of Act No. 407 of the 1971 Regular Session of the Alabama Legislature (Title 28A, § 177(2), Code of Alabama 1940, 1973 Cumulative Supplement, now Section 27-8-28, Code of Alabama 1975) involving the embezzlement of premiums or other funds by an insurance agent. On a four year sentence the appellant was ordered imprisoned for six months and granted probation for the remainder of his sentence.
In October of 1975 Robert C. Farnham met with Donald E. Luna in order to secure a six hundred thousand dollar loan with which to open the cardboard manufacturing firm of Sumter Industries, Inc. Luna was the vice-president of Business Insurance Consultants, Inc. The appellant was its president.
This ten thousand dollar check was deposited that same day to the account of Business Insurance Consultants giving this account a balance of $11,045.27. The appellant, Luna, and Charlotte L. Cox were the only persons authorized to sign on this account. Immediately the appellant took $6,500.00 of this total amount and deposited it to Mortgage Brokers of America, Inc. The appellant and Luna were the only two persons authorized to sign on this account. By December 31, 1975, a balance of $1,521.53 remained in the account of Business Insurance Consultants.
Farnham never received any insurance through the appellant, Luna, or Business Insurance Consultants. Though the appellant had submitted, as an agent, Farnham's application for life insurance to Kennesaw Life and Accident Insurance Company, on March 16, 1976, the company's file was closed because requested information had not been received. The file was never reopened.
On August 18, 1976, Farnham, through his attorney, formally demanded the return of his ten thousand dollars. The money was never returned.
In his defense the appellant testified that he received Farnham's check as an officer and not a licensed insurance agent of Business Insurance Consultants. He testified to his efforts to secure a policy of insurance and that these efforts continued through July 26, 1976. He maintained that he never received any notice of any type of the request for refund until after he had been indicted. The appellant testified that Farnham's ten thousand dollars was and always had been available for return upon request.
In rebuttal the State called Ronald Braswell who testified that during the summer of 1976 the appellant told him that "Farnham had asked for his money back and that . . . he felt like Farnham should be given his money back and that he would raise his five thousand dollars or his portion of the money provided Don Luna would raise his portion of the money and refund the money to Bob Farnham".
Initially the appellant alleges that the State did not prove that he was acting as an agent in receiving the ten thousand dollars as charged in the indictment and as required by statute.
The indictment was framed in and tracked, as closely as possible, the language of Title 28A, Section 177, Code of Alabama 1940, 1973 Cumulative Supplement. That section reads:
An "agent" is defined by statute:
(1) Any regular salaried officer or employee of an insurer or agent who does not solicit or accept from the public applications for any such insurance or contracts;
(2) A ticket-selling agent of a common carrier who sells accident insurance tickets to individuals; or
(3) Any regular salaried officer or employee of an insurer who renders assistance to, or on behalf of, a licensed agent of the insurer, if such officer or employee devotes substantially all of his time to activities other than the solicitation of applications for insurance or annuity contracts and receives no commission or other compensation directly dependent upon the amount of business obtained."
Title 28A, Section 156, Code of Alabama 1940, 1973 Cumulative Supplement (§ 27-8-1, Code of Alabama 1975).
The appellant maintains that the ten thousand dollar check was not a premium and that there is absolutely no evidence that he received any funds "in a transaction under his license".
Farnham testified that he never discussed business "as such" with the appellant and that the ten thousand dollar check was "the down payment" for the three million dollar life insurance policy. The receipt signed by the appellant and Luna as president and vice-president of Business Insurance Consultants, Inc. concerned the "$10,000.00 binder for keyman mortgage insurance" and acknowledged receipt of a "deposit for $10,000.00". On cross examination Farnham testified that "this was just a deposit to be used as a premium" and stated that "(d)eposit, premium, it is the same thing".
On Farnham's application for insurance with Kennesaw Life and Accident Insurance Company the appellant signed his name in two places designated as "agent" and "name of agent". An underwriter for Kennesaw testified that the appellant was an agent for that company and that she received an application for insurance on Farnham signed by the appellant "as agent". She specifically testified that the appellant was "the agent in this case".
Although the appellant testified that he was not with Business Insurance Consultants as an insurance agent, he also stated that he "had to be an agent", and not a consultant, when he submitted Farnham's application to Kennesaw. He testified that he made the application as an agent.
The prosecution introduced the appellant's insurance license issued by the State of Alabama for the year of 1975 with Kennesaw Life and Accident Insurance Company. The license covered life and disability insurance.
Under these facts we have no difficulty in finding that the appellant was an "agent" and in receiving the ten thousand dollar check and submitting the application for life insurance he was acting "in transactions under his license".
Whether the ten thousand dollar check be considered a premium or deposit is immaterial. The check was received by an agent in a transaction under his license. The statute specifically covers "all premiums, return premiums Or other funds belonging to others ". Title 28, Section 177(1).
The appellant further argues that "if he converted any funds it may have been as ordinary embezzlement, grand larceny or conceivably false pretenses but certainly not under this narrowly laid section of the Code". We do not agree. The statute was enacted to cover the very type situation presented here. Were it not for the appellant's agency and license, no application for insurance would have been submitted and no money would have been received. Under these circumstances the trial court properly denied the appellant's motion to exclude the State's evidence and request for the affirmative charge.
In urging this Court to reverse his conviction the appellant also maintains that, since there was no evidence of a conspiracy between himself and Luna, evidence should not have been admitted against him under any theory of a conspiracy.
Though circumstantial, substantial evidence of a conspiracy exists. The appellant was president and Luna was vice-president of Business Insurance Consultants, Inc. Both signed a receipt for the ten thousand dollars and acknowledged that this amount would be returned within five days after request if the insurance was not obtained. Farnham handed the check to Luna. The very day the check was received it was deposited into the account of Business Insurance Consultants. A portion of that amount was then withdrawn by the appellant and deposited into the account of Mortgage Brokers of America, Inc. The appellant and Luna were the only persons authorized to sign on this account. In the summer of 1976 the appellant made the statement that he knew Farnham had asked for the return of his ten thousand dollars and he would raise "his five thousand dollars or his portion of the money" if Luna would raise his. No insurance was ever obtained and, after demand, the ten thousand dollars was never returned.
These circumstances support a finding that the appellant and Luna were co-conspirators in the same crime even though Luna, not being a licensed insurance...
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