Gutru v. State
| Decision Date | 16 November 1933 |
| Docket Number | 28571 |
| Citation | 250 N.W. 913,125 Neb. 506 |
| Parties | GEORGE H. GUTRU v. STATE OF NEBRASKA |
| Court | Nebraska Supreme Court |
ERROR to the district court for Madison county: CHARLES H. STEWART JUDGE. Affirmed.
AFFIRMED.
Syllabus by the Court.
1. An instruction, in effect that a bank shall be deemed insolvent when the actual cash market value of its assets is insufficient to pay its liabilities to its depositors, allowing a reasonable time to realize on such assets and referring what is such reasonable time to the jury, held not prejudicially erroneous in the prosecution of a banker under section 8-147, Comp. St. 1929, for receiving deposits knowing the bank to be insolvent.
2. In the prosecution of an officer of the bank for receiving deposits when the bank was insolvent, an assistant receiver in charge of notes held by a bank in receivership is permitted to testify to the value of such notes, upon a foundation being laid showing his knowledge of the financial condition of the makers.
3. " Before error can be predicated upon the failure to charge the jury upon a given point, there must have been a request therefor, unless it is upon a question where a statute or positive rule of law requires the giving of such instruction." Georgis v. State, 110 Neb. 352, 193 N.W. 713.
4. Where a managing officer, knowing a bank is insolvent, authorizes and permits it to remain open and to continue to receive deposits through its officers and employees, he is guilty of knowingly " being accessory to, or permitting or conniving at the receiving or accepting" of deposits, even though he may not have had actual knowledge of the receiving of such deposits.
5. When a bank is insolvent, withdrawals of deposits by relatives and members of the families of defendant and other officers of the bank are competent to be considered, with other facts and circumstances, in determining their bearing upon defendant's knowledge of the insolvency of the bank.
Error to District Court, Madison County; Stewart, Judge.
George H. Gutru was convicted of feloniously receiving deposits and conniving at receiving of deposit knowing bank to be insolvent, and he brings error.
Affirmed.
Gaines, McGilton, McLaughlin & Gaines and William L. Dowling, for plaintiff in error.
Paul F. Good, Attorney General, Carl H. Peterson and George I. Craven, contra.
OPINION
George H. Gutru was the president and active managing officer of the Newman Grove State Bank. It was closed and taken over by the state banking department on July 16, 1929. On December 30, 1931, an information was filed, consisting of nine counts, each charging George H. Gutru with the offense of feloniously receiving and conniving at the receiving of a described deposit when the bank was insolvent and when he knew it was insolvent. Comp. St. 1929, sec. 8-147. The first deposit was charged to have been received on May 25, 1929. The others followed in chronological order, the last being on July 15, 1929. Defendant was found not guilty on the first count and guilty on the other eight counts. Upon each of these counts he was sentenced to be confined in the penitentiary for a period of five years, but the judgment provided that the sentences should run concurrently, not consecutively. Defendant brought proceedings in error.
The trial lasted two weeks. The record is voluminous. Many errors are assigned. They have been carefully examined. Too lengthy discussion of their details is prohibitive. The chief question are whether the bank was insolvent, whether defendant knew it was insolvent, and whether the court erroneously instructed the jury on the subject of insolvency.
The instruction defining insolvency follows:
As heretofore stated, the last deposit charged in the information was received on July 15, 1929. The legislature of that year had amended the "words and phrases" section (Comp. St. 1922, sec. 7985), which contained no definition of "insolvency," so as to define that word. The amending act was approved March 26, 1929. It contained no emergency clause. The legislative session adjourned April 24, 1929. So the act did not take effect until three calendar months thereafter (Const. art. III, sec. 27), or on July 25, 1929, which was nine days after the bank was closed. However, we quote the new words of the amendment to show the definition devised by the legislature:
"The terms 'insolvent,' 'insolvency' and 'insolvent bank,' as used in this article and amendments thereto, in reference to banking corporations governed by this article and such amendments, shall, for the purposes of this article, have the following meaning: A banking corporation subject to the provisions of this article shall be deemed to be insolvent when the actual cash market value of its assets is insufficient to pay its liabilities to its depositors, or when it is unable to meet the demands of its creditors in the usual and customary manner, or when it shall fail to make good its reserve as required by law, or when the stockholders, upon notice from the department of trade and commerce or its successor, shall fail to make good an impairment of its capital." Laws 1929, ch. 37, sec. 1; Comp. St. 1929, sec. 8-116.
Generally, "The test of insolvency is the insufficiency of available property to pay debts." O'Bryan v. State, 111 Neb. 733, 197 N.W. 609. "'Insolvency,' as that term is ordinarily used, is not the same thing as a mere failure to pay debts, but, as applied to an individual or a corporation, it means an insufficient amount of property to pay debts." Frank v. Stearns, 111 Neb. 101, 105, 195 N.W. 949.
Probably, when the trial judge phrased the instruction and gave it to the jury on June 17, 1932, he had considered the legislative definition of insolvency in the aforesaid act of March 26, 1929. While it had not been adopted as a statutory definition of insolvency, imperatively applicable to the cause on trial, the court evidently undertook to apply its thought and content. In so doing it appears that the result ought not to be complained of by defendant. The instruction directed the jury not to appraise the bank assets on any particular deposit date as if there had to be an actual market for cash at that particular moment but that a reasonable time must be considered and allowed by the jury for the bank to realize upon its assets in the usual and ordinary course of the banking business, not by forced and involuntary sales. In taking the evidence on this subject the aim and general purpose of the trial seems to have been to discover evidentially the ultimate cash value of each asset as of the time fixed; this value to be determined, however, by such a market as can be found for such an asset in the ordinary manner of dealing. The instruction complained of contains certain sentences which, separated from the rest, would be subject to the criticism of defendant as imposing an unfair burden upon him and making the business of banking criminally hazardous in times like the present. But when these sentences are modified by other language of the instruction, explaining the meaning of words and phrases theretofore used, we think the points criticized lose their harshness and that the jury were not misled thereby but understood them in the sense derivable from the entire instruction. Considering the whole instruction, we think the court expressed in effect the liberal rule rather than the bankruptcy definition which requires obligations to be paid as they become due in order to avoid insolvency. We do not commend the phrasing of the instruction as a model for future use in like cases but are of the opinion it was not prejudicial to defendant. In a current cause, involving the same charge, we have just held: "An instruction that a bank may be deemed insolvent when it is unable to meet the demands of its creditors in the usual and customary manner and when the cash value of its assets is insufficient to pay its liabilities, allowing a reasonable time to realize on such assets, held not prejudicially erroneous in a prosecution against a banker for receiving deposits knowing the bank to be insolvent." Flannigan v. State, p. 519, post.
Two assignments relate to the testimony of Harry Henatsch, a state witness who had...
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