Lochner v. State

• Court: Wisconsin Supreme Court
• Writing for the Court: NELSON
• Citation: Lochner v. State, 214 Wis. 109, 252 N.W. 695 (Wis. 1934)
• Decision Date: 19 February 1934
• Parties: LOCHNER v. STATE.

214 Wis. 109

252 N.W. 695

LOCHNER

v.STATE.

Supreme Court of Wisconsin.

Feb. 6, 1934.

Dissenting Opinion Feb. 19, 1934.

Error to review a judgment of the Municipal Court of Milwaukee County; George A. Shaughnessy, Municipal Judge.

Fred A. Lochner was convicted of willfully and knowingly making false statements to banking commissioner and making false entries in books of the bank, and he brings error.--[By Editorial Staff.]

Reversed, with directions to discharge the accused.

OWEN, J., dissenting.

Plaintiff in error, hereafter called the defendant, was indicted by a grand jury of Milwaukee county. The indictment contains nine counts, each of which charges a violation of section 221.17. Trial was had to the court, trial by jury having been waived. The court found the defendant guilty as charged, and, after hearing the usual motions made in a criminal case after verdict of guilty, sentenced the defendant on each count to the Wisconsin State Prison at Waupun for an indeterminate term of from one to two years, the sentences to run concurrently. Thereupon defendant sued out this writ of error.

Fish, Marshutz & Hoffman, of Milwaukee (I. A. Fish, F. C. John, and W. H. Voss, all of Milwaukee, of counsel), for plaintiff in error.

James E. Finnegan, Atty. Gen., and William A. Zabel, Dist. Atty., and Winfred C. Zabel, First Deputy Dist. Atty., both of Milwaukee, for the State.

NELSON, Justice.

The indictment herein contains nine counts, each of which charges a violation of section 221.17. So much of that section as is here material provides: “Any banker, officer, director or employee of any bank who shall wilfully and knowingly subscribe to or make, or cause to be made, any false statement or false entry in the books of any bank, or mutual savings bank, or shall knowingly subscribe to or exhibit false papers, with the intent to deceive any person or persons authorized to examine into the affairs of said bank, or mutual savings bank, or shall knowingly make, state, or publish any false report or statement of any such bank, or mutual savings bank, shall be deemed guilty of a felony, and upon conviction thereof shall be punished. * * *”

The first count of the indictment charges that on February 11, 1930, the defendant was president and director of the Bank of Shorewood and that he willfully and knowingly subscribed to and made, or caused to be made, false statements, or false entries in the books of said bank, and knowingly subscribed to and exhibited false papers with the intent to deceive any person or persons authorized to examine into the affairs of the bank, in that he entered and caused to be entered in the books and records of the bank the name of one T. J. Marlier as having subscribed to and paid for 10 shares of the capital stock of the bank and issued and caused to be issued to the said T. J. Marlier certificate No. 215 for said stock, subscribed by the said Fred A. Lochner as president of said bank for the said 10 shares, and entered and caused to be entered in the books of said bank the name of said T. J. Marlier as the owner and holder of said stock, when in fact the said F. A. Lochner was the subscriber to the said stock and paid therefor and was the holder and owner thereof, contrary to the statute in such case made and provided and against the peace and dignity of the state of Wisconsin.

The second, third, fourth, fifth, and sixth counts are substantially the same as the first count except as to the dates of the alleged offenses, the number of shares involved, and the names of Jacob Strass, James H. Pratt, W. H. Bennett, and John Reisner, in whose names respectively the stock was entered in the books of the bank.

The seventh count charges that: “On March 12th, 1930, in the County of Milwaukee and State of Wisconsin, Fred A. Lochner, as president and director of the Bank of Shorewood, willfully and knowingly subscribed to and made and caused to be made false statements and false entries in the books of the said bank, and knowingly subscribed to and exhibited false papers, with the intent to deceive any person and persons authorized to examine into the affairs of said bank, and knowingly made, stated and published a false report and statement of the said bank, in that he, the said Fred A. Lochner, then and there, in the manner and with intent as aforesaid, made and caused to be made, and subscribed and swore thereto, a statement of the stockholders of the said bank, with the number of shares owned and held by each, as required by section 221.15 (6) of the Wisconsin Statutes, and included therein the names of certain person or persons who were not in fact holders of stock in the said bank, the shares purported in said statement to be held by them being in fact owned and held by the said Fred A. Lochner, and in said statements excluded the falsely reported shares from the statement of the shares owned by the said Fred A. Lochner, and that the said Fred A. Lochner mailed or caused to be mailed the said list, report and statement to the Commissioner of Banking, all contrary to the statutes.”

The eighth count charges an offense as of April 3, 1930, similar to that alleged in the seventh count, and alleges that the report or statement to the commissioner of banking under date of April 3, 1930, included W. H. Bennett as the owner and holder of 15 shares, T. J. Marlier as the owner and holder of 20 shares, J. H. Pratt as the owner and holder of 35 shares, and Jacob Strass as the owner and holder of 45 shares, all of which it is alleged were owned and held by the defendant.

The ninth count is substantially the same as the eighth count, except the date alleged therein, January 16, 1931, and except that it also alleges the name of John Reisner as the owner and holder of 25 shares.

While the allegations of the several counts of the indictment are general, broadly following the language of the statute, and not as specific as might be desirable, it is very evident from the proof adduced upon the trial that by the allegations of the first count it was intended to charge an offense based upon an entry in the stock register of the bank which showed that Marlier was the owner of certain stock; that the second, third, fourth, fifth, and sixth counts were based upon similar entries, which showed that Pratt, Strass, Bennett, and Reisner were the owners of stock. It is also clear that the seventh, eighth, and ninth counts intended to charge that the defendant knowingly subscribed to or exhibited false reports to the commissioner of banking with intent to deceive such officer.

The proof adduced by the state upon the trial in support of the first and fourth counts is substantially as follows: On December 20, 1923, Marlier was the owner of 2 shares of Bank of Shorewood stock of the par value of $100 each. The total capital stock of the bank was $25,000. In 1930, the amount of authorized stock was increased to $50,000 and the par value of each share of stock was reduced to $20. On February 11, 1930, he sold 2 shares of stock to the defendant for $500 and assigned and delivered his certificate therefor to him. The 2 shares were not transferred on the stock register. Thereafter, when the $20 par stock was ready to be exchanged for the old stock, Marlier receipted to the bank for certificate No. 215 for 10 shares in place of the 2 shares which he had theretofore owned and theretofore sold to the defendant. He indorsed the new stock and turned it over to the defendant. He also subscribed for 10 shares of additional stock to which he was entitled only on the theory that he was still a stockholder. He receipted to the bank for certificates Nos. 267 and 268, which he indorsed in blank and delivered to the defendant. Thereafter he indorsed four separate dividend checks issued in his name and turned them over to the defendant. He also signed a power of attorney authorizing the cashier to indorse over to Safety Deposit Company a special dividend declared by the bank. Marlier testified that he knew when he signed the receipt on the stock book that he became a stockholder of record, knew that he would remain a stockholder of record until the shares were presented for transfer, and knew that by receiving dividend checks he was a stockholder of record up to June 30, 1931. He asked the defendant several times about having the stock taken out of his name, but never presented the stock to the bank for transfer after he had indorsed it, nor took any other steps looking to the transfer of such stock on the books of the bank.

The proof adduced by the state in support of the second count is substantially as follows: In December, 1928, at the request of the defendant, Strass bought 5 shares of bank stock from Arthur J. Straus. He paid for the stock with his own money, but was later reimbursed therefor by the defendant. The Straus certificate was exchanged for another certificate which was indorsed in blank by Strass and delivered to the defendant. That certificate was, upon the increase of the capital structure, on February 11, 1930, exchanged for a certificate for 25 shares, which was in turn exchanged for three certificates aggregating 25 shares. The three certificates just mentioned were, on and between March 15 and March 19, 1930, assigned and transferred to others not connected with this controversy. Strass receipted for all of the certificates mentioned which were issued in his name. Later on he subscribed and receipted for 25 shares of the additional stock to which he, if a stockholder, was entitled. At another time shortly prior to July 12, 1929, at the request of the defendant, he purchased 4 shares of stock from one Baer. A new certificate in exchange therefor was issued to Strass on July 12, 1929, which certificate was receipted for by him and delivered to the defendant. Later on this certificate was exchanged for 20 shares of the $20 par value stock which Strass receipted for, but which he indorsed in blank and delivered to ...