Griffin v. State

• Decision Date: 11 November 1914
• Parties: GRIFFIN v. STATE.
• Court: Georgia Supreme Court

83 S.E. 540

142 Ga. 636

GRIFFIN v. STATE.

Supreme Court of Georgia

November 11, 1914

Syllabus by the Court.

Properly construed, Pen. Code 1910, § 204, which provides for raising a presumption of fraud against the president and directors of an insolvent bank chartered in this state, is not violative of the fourteenth amendment of the Constitution of the United States, on the ground that it abridges the privileges and immunities of citizens of the United States, or deprives the president and directors of an insolvent bank of the equal protection of the laws, or deprives them of life, liberty, or property without due process of law, on the ground that similar provisions have not been made in regard to the president and directors of other corporations than banks.

(a) That section is not violative of the fourteenth amendment of the Constitution of the United States for any of the reasons set out in the first question by the Court of Appeals.

The fifth amendment of the Constitution of the United States is not a limitation upon the power of the states, but operates upon the national government only. Accordingly section 204 of the Penal Code of 1910, is not invalid, as being violative of that amendment.

Pen Code 1910, § 204, is not violative of article 1, § 1, par. 3 of the state Constitution, which declares that "no person shall be deprived of life, liberty, or property except by due process of law."

Within the meaning of Pen. Code 1910, § 204, the "insolvency" of a bank is that condition in which its entire property and assets are insufficient to pay all of its debts.

(a) If the entire property and assets of a bank are sufficient to discharge its liabilities, it is not insolvent, within the meaning of Pen. Code 1910,§ 204, although it may not be able to pay its debts immediately as they become due, or to pay its depositors on demand.

(b) Civ. Code 1910, § 2306, which provides for the winding up of a bank by the state bank examiner under certain circumstances therein declared, does not furnish a definition of insolvency to be applied in construing Pen. Code 1910, § 204.

Certified Questions from Court of Appeals.

J. W. Griffin was charged with crime, and the Court of Appeals certifies certain questions to the Supreme Court. Questions answered in opinion.

See, also, 12 Ga.App. 615, 77 S.E. 1080.

It is not the intention of Pen.Code 1910, § 204, providing for raising a presumption of fraud against the president and directors of an insolvent state bank, that such presumption shall be conclusive.

The Court of Appeals certified to the Supreme Court the following questions:

"Is section 204 of the Penal Code of Georgia of 1910 violative of the provisions of the fourteenth amendment of the Constitution of the United States, that 'no state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States, nor shall any state deprive any person of life, liberty, or property, without due process of law, nor deny to any person within its jurisdiction

the equal protection of the laws,' for the reason that the provision of this section of the Code that every insolvency of a chartered bank shall be deemed fraudulent, and the president and directors shall be severally punished by imprisonment and labor in the penitentiary, abridges the privileges and immunities of citizens of the United States, or deprives the president and directors of such a bank of equal protection of the laws with like officers of other corporations, as to whom there is no law providing that insolvency of the corporation shall be deemed fraudulent, and that the president and directors, or other officers, shall be severally punishable by imprisonment and labor in the penitentiary on proof of insolvency of the corporation, or for the reason that this provision of the Code destroys or abridges the presumption of innocence which the law raises as evidence in behalf of every one charged with crime, or for the reason that it deprives the president and directors of an insolvent chartered bank of the right of presenting their defense to the charge of fraudulent intent, especially since, under the law of this state, the defendant is deprived of the right of testifying in his own behalf, or for the reason that this section of the Code declares insolvency of a chartered bank to be fraudulent and provides that the president and directors of the bank shall be punished, even though they had nothing to do with the management of the bank and though the insolvency was not brought about by their conduct or with their knowledge, or for any other reason suggested by the defendant's demurrer?

(2) Is section 204 of the Penal Code, for any of the reasons stated in the foregoing question, violative of the provision of the fifth amendment of the Constitution of the United States that 'no person shall * * * be deprived of life, liberty, or property, without due process of law'?

(3) Is section 204 of the Penal Code, for any of the reasons stated above, violative of the provision of article 1, § 1, par. 3, of the Constitution of the state of Georgia, that 'no person shall be deprived of life, liberty, or property, except by due process of law'?

(4) Is a bank insolvent, within the meaning of section 204 of the Penal Code, if the entire property and assets of the bank are sufficient to discharge its liabilities by process of liquidation, even though it may not be able to pay its debts immediately as they become due, or to pay its depositors on demand? In what respect, if any, is the meaning of the term 'insolvency,' as applied to a chartered bank, differentiated from the meaning of that term as applied to the financial condition of an individual? Are sections 2306 of the Civil Code and 204 of the Penal Code to be construed together, and is the test of insolvency indicated in the former section to be applied in construing the latter?"

Pen. Code 1910, § 204, to which reference is made in the preceding questions, reads as follows:

"Every insolvency of a chartered bank, or refusal or failure to redeem its bills on demand, either with specie or current bank bills passing at par value, shall be deemed fraudulent, and the president and directors shall be severally punished by imprisonment and labor in the penitentiary for not less than one year nor longer than ten years: Provided, that the defendant may repel the presumption of fraud, by showing that the affairs of the bank have been fairly and legally administered, and generally with the same care and diligence that agents, receiving a commission for their services, are required and bound by law to observe; and upon such showing the jury shall acquit the prisoner."

Hamilton McWhorter, Jr., of Lexington, W. W. Armistead, of Crawford, and Geo. C. Thomas, Thos. J. Shackelford, and Holden & Shackelford, all of Athens, for plaintiff in error.

John B. Gamble, Sol. Gen., and Cobb & Erwin, all of Athens, for the State.

LUMPKIN J.

1. With certain limitations the Legislature may enact that, when specified facts have been proved, they shall, even in a criminal case, be prima facie evidence of the guilt of the accused, and shift the burden of proof. On this power there are limitations, the principal one of which is that the fact or facts which will raise the presumption and shift the burden of proof must have some fair relation to, or material connection with, the main fact as to which the presumption is raised. The inference or presumption from the facts proved must not be merely arbitrary, or wholly unreasonable, unnatural, or extraordinary, but must bear some reasonable relation to the facts proved. To illustrate: If the Legislature should declare that every man found wearing a straw hat in September should be presumed to have committed any forgery which took place in that month, such an act would be invalid, because there is no rational connection between forgery and wearing a straw hat, and the presumption would be purely arbitrary. But if the Legislature should declare that one found in possession of stolen goods shortly after a larceny should be prima facie presumed to be the thief, and that the burden of rebutting the presumption should rest on him, this would be valid; the presumption not being purely arbitrary, but there being a reasonable connection between the possession of the stolen goods and the commission of the larceny. Moreover, the presumption so raised must not be final; but the accused must be allowed a fair opportunity to make his defense, and show all of the facts bearing on the issue, and to have the whole case submitted to the jury for decision, after considering all of the evidence, as well as the prima facie presumption, if the facts from which it arises have been proved to exist. Banks v. State, 124 Ga. 15, 52 S.E. 74, 2 L.R.A. (N. S.) 1007, and note; Vance v. State, 128 Ga. 661, 57 S.E. 889; Wilson v. State, 138 Ga. 489, 493, 75 S.E. 619; 2 Jones, Ev. § 196; Mobile, etc., R. Co. v. Turnipseed, 219 U.S. 35, 31 S.Ct. 136, 55 L.Ed. 78, 32 L.R.A. (N. S.) 226, Ann.Cas. 1912A, 463, and note; State v. Thomas, 6 Ann.Cas. 744, 746, and note (144 Ala. 77, 40 South, 271, 2 L.R.A. [N. S.] 1011, 113 Am.St.Rep. 17); 3 Enc.Ev. 291; 14 Enc.Ev. 110.

The exercise of this power by the Legislature in relation to chartered banks, so as to raise a prima facie presumption of fraud against the president and directors upon proof of the insolvency of the bank, is not violative of the fourteenth amendment of the Constitution of the United States on the ground that it deals with chartered banks, and not with other corporations. Legitimate classification in such cases does not deprive persons within the class of the equal protection of the laws. If banks cannot be legitimately classified,...