Day v. United States

• Decision Date: 17 December 1915
• Docket Number: 1264.
• Citation: 229 F. 534
• Parties: DAY v. UNITED STATES.
• Court: U.S. Court of Appeals — Fourth Circuit

229 F. 534

DAY v. UNITED STATES.

No. 1264.

United States Court of Appeals, Fourth Circuit.

December 17, 1915

Charles A. Hammer, of Harrisonburg, Va. (John Paul, of Harrisonburg Va., on the brief), for plaintiff in error.

Richard E. Byrd, U.S. Atty., of Richmond, Va.

Before KNAPP and WOODS, Circuit Judges, and CONNOR, District Judge.

KNAPP Circuit Judge.

The facts are sufficiently stated in our former opinion. 220 F 818, 136 C.C.A. 406. On petition of the government a rehearing was ordered and the questions involved have been further considered.

As the case appeared at the first hearing, a majority of the court were of opinion that proof of sales in 1909, the year preceding the two years named in the indictment, was improperly received, and for that reason mainly the judgment of conviction was reversed. In the light of the presentation now made, and on the authority of Ledbetter v. United States, 170 U.S. 606, 18 Sup.Ct. 774, 42 L.Ed. 1162, and other cases brought to our attention, we are constrained to hold that evidence of prior sales was admissible in support of the substantive charge of carrying on the business of a wholesale liquor dealer without a license; and it follows that the judgment should not be reversed because this evidence was admitted.

If this were the only question at issue, it would seem to be our duty to affirm the judgment; but we are of opinion that on other grounds the defendant is entitled to a new trial. The sole offense charged against him is the carrying on of the business named 'without having paid the special tax therefor as required by law. ' He was not ostensibly engaged in that business, but there was proof of sales of liquor by him, apparently on his own account, and of payments to him for the same, by checks drawn to his order and deposited in bank to his own credit, from which the jury might have found, as we shall assume, that he was in fact carrying on business for himself and therefore guilty of the offense for which he was indicted. His defense was that in all the transactions shown he was acting, not for himself but as agent for his brother, and this was the real question for the jury to determine. In the course of the trial, and as supporting the charge that defendant was not his brother's agent but was himself the principal in making the various sales proven, evidence was allowed tending to show that the distillery which produced the liquor sold though bonded by his brother, was in reality owned and operated by defendant himself for his own benefit. Indeed, the record indicates that the question to which a considerable part of the testimony was directed, and upon which the controversy seems largely to have turned, was not so much whether defendant was a wholesale liquor dealer as whether he was the actual proprietor and beneficial owner of the distillery.

In point of fact the distillery was bonded by defendant's brother, T. T. Day, for both of the years named in the indictment, and had been bonded by him for a number of years before. The revenue officers appear to have always recognized T. T. Day as the proprietor, and to have dealt with the distillery at all times as owned and operated by him. And it seems rather inconsistent that the government, whose officials in charge never raised any question as to the ownership of the distillery by T. T. day, should now undertake to show that defendant was in fact the real proprietor, and this for the purpose of proving that he was a wholesale liquor dealer, and so guilty of carrying on that business without paying the special tax therefor. Moreover, it may be noted in this connection that there has been no fraud upon the government, so far as its revenues from this distillery are concerned. The tax has been paid, nominally, at least, by or for T. T. Day, in conformity with law and the obligations of his bond; and as a distiller he had the right to sell at wholesale, upon payment of the tax for which he had given security, without taking out a license. The government got the full revenue which it had the right to collect, and took the same as and for the tax on the brandy produced at this distillery, and to secure which it accepted the bond of T. T. Day and authorized him to operate the distillery during the years in question. In these circumstances it seems hardly fair to seek to convict the defendant for unlawfully carrying on the business of a wholesale liquor dealer by showing that he was also guilty of illicit distilling, which is an entirely different offense.

The prejudicial effect of the evidence that defendant was running the distillery on his own account, when he was on trial for carrying on another kind of business without a license, is not open to...