Pulford v. United States, 10036.

• Decision Date: 24 June 1946
• Docket Number: No. 10036.,10036.
• Citation: 155 F.2d 944
• Parties: PULFORD v. UNITED STATES.
• Court: U.S. Court of Appeals — Sixth Circuit

155 F.2d 944 (1946)

PULFORD v. UNITED STATES.

No. 10036.

Circuit Court of Appeals, Sixth Circuit.

June 24, 1946.

Walter E. Kelly, of Detroit, Mich. (George A. Kelly and Walter E. Kelly, both of Detroit, Mich., on the brief), for appellant.

A. Stewart Kerr and Thomas P. Thornton, both of Detroit, Mich. (John C. Lehr, Thomas P. Thornton and A. Stewart Kerr, all of Detroit, Mich., Bernard J. Vincent, of Washington, D. C., and Franklin C. Knock, of Detroit, Mich., on the brief), for appellee.

Before SIMONS, ALLEN, and MILLER, Circuit Judges.

SIMONS, Circuit Judge.

The appellant was convicted on two counts of an indictment, the first charging him with conspiring to commit offenses against the United States in violation of Title U.S.C.A., 50 Appendix, § 1191, the Renegotiation Act, the second with furnishing a false financial statement to the Secretary of Way and the Price Adjustment Section in connection with costs incurred by the Affiliated Engineering Company, in violation of the same section. His principal contention on appeal is that at the trial the court permitted the introduction of excerpts from his evidence which, in violation of his constitutional right to immunity, he was compelled to give to the Grand Jury.

The Affiliated Engineering Company was an enterprise located in Detroit, designing tools, jigs, dies and the like, used by prime contractors with the government for the manufacture of machinery and other products used in the prosecution of the war. One Andrew Kalman was either its sole owner or a partner in its ownership. Upon contracts with the United States the company had, during 1942, sales in excess of $100,000, and so was subject to the provisions of the Renegotiation Act which became effective April 28, 1942, the renegotiation period extending from that date until December 31. The appellant is a certified public accountant and was employed by Affiliated before, during and subsequent to the renegotiation period. Negotiations initiated by the government terminated in an agreement in January, 1944. On September 28, 1944, the appellant was summoned by subpoena to appear before the Grand Jury relative to certain transactions of Affiliated Engineering Company. A month later he and Kalman were indicted, but the appellant alone stood trial. We are advised that Kalman pleaded guilty.

The contention of the appellant that his constitutional exemption against self-incrimination, preserved to him by the Fifth Amendment, was violated, grows out of a colloquy which took place between him and Assistant United States Attorney Thornton and Kerr, a Special Assistant to the Attorney General, when he entered the jury room, the point being raised at the trial by a motion to quash the indictment and discharge the defendant, which was overruled. The colloquy is set forth in full in the margin.¹ It is argued that those in charge of the Grand Jury investigation by the observations made therein, withheld from the appellant a full understanding of his rights; that the explanation they offered of his immunity from self-incrimination was unintelligible; that they erroneously informed him that his testimony was to be confined to public records when in fact the records upon which he was later questioned were the private records of the Affiliated Engineering Company then in possession of the Grand Jury under a cloak of secrecy; that the statements of the investigators were bewildering and grossly misleading; that the defendant was by them confused and deceived as to the extent and purport of the waiver and so could not do an intelligent and voluntary act in respect to it.

It will be observed, however, upon consideration of the colloquy, that the appellant was mainly concerned as to whether his evidence would violate some rule of privilege in respect to confidential information obtained by him as an accountant for the Engineering Company, and whether disclosures without the consent of Kalman, would subject him to a cancellation of license to practice his profession. Apparently satisfied by the offers of the investigators to obtain a clarification of the matter from the Board of Accountants and interpreting that offer as advice that he need fear no discipline by the Board, he declared his willingness to sign the waiver tendered to him.

It is quite true that there is much that is surprisingly inept and unintelligible in the effort of an Assistant United States Attorney and a Special Assistant to the Attorney General to explain the purpose of the waiver, and that at one stage of the interview the appellant was, or professed to be under an impression that he could not be prosecuted if he failed to testify to the truth. That misunderstanding was, however, resolved by Thornton's warning to him that if he testified falsely he might be prosecuted. The appellant's reference to qualifications in the document tendered to him, is likewise unintelligible, but it would seem to refer to an understanding that if he signed the waiver and gave evidence he would be in no trouble with the Board of Accountants.

However confusing the colloquy may be, one aspect of it stands out quite clearly. By no word or phrase did the appellant indicate that he was averse to giving evidence on the ground that it would incriminate him. On the contrary, he repeatedly insisted that he had always hewed to the line in the practice of accountancy, and that there was nothing in his past record for which he could be prosecuted. Nor was there deceit by the investigators as to the character of the records concerning which he was to be interrogated. Section 1191(c) (5) (A) of Title 50 requires that every contractor who holds contracts to which the provisions of the subsection are applicable, file with the Board a financial statement setting forth such information as the Board may, by regulations, prescribes, and that the contractor shall furnish the Board any information, records or data which the Board may determine to be necessary to carry out the mandate of the section. Such records were available to the investigators and to the Grand Jury. They were therefore not the private records of the Engineering Company but were public records, or records at least of a semi-public character, which, like records of corporations, the production of which may be compelled, are not inviolable. United States v. Austin-Bagley Corporation, 2 Cir., 31 F.2d 229, 233, 234; Heike v. United States, 227 U.S. 131, 33 S.Ct. 226, 57 L.Ed. 450. Of such records Judge Learned Hand, in the Austin-Bagley case, interpreting Heike v. United States, said, "Hence it appears to us that the case determines that testimony auxiliary to the production is as unprivileged as are the documents themselves." 31 F.2d 234.

Had the appellant explicitly claimed immunity on the ground of self-incrimination, it is doubtful that it would have been of any avail. Not only is there no privilege on the part of an agent or employee of a corporation to refuse to disclose matter which the governing statutes require him to record or report, Essgee Co. of China v. United States, 262 U.S. 151, 43 S. Ct. 514, 67 L.Ed. 917; United States v. Austin-Bagley Corporation, supra; Morgan, The Law of Evidence, LIX Harvard Law Review No. 4,526; but this doctrine has been extended to voluntary associations, United States v. White, 322 U.S. 694, 64 S.Ct. 1248, 1252, 88 L.Ed. 1542, 152 A. L.R. 1202, and the historic function of the privilege is there declared to be that of "protecting only the natural individual from compulsory incrimination through his own testimony or personal records," and "the papers and effects which the privilege protects must be the private property of the person claiming the privilege or at least in his possession in a purely personal capacity."

The written waiver of immunity offered to the appellant to sign was undoubtedly tendered to him in an excess of caution. There was no obligation on the part of the investigators to warn him of his constitutional right to remain silent prior to his examination before the Grand Jury. Wilson v. United States, 162 U.S. 613, 16 S.Ct. 895, 40 L.Ed. 1090; Powers v. United States, 223 U.S. 303, 313, 32 S.Ct. 281, 56 L.Ed. 448; United States v. Hirsch, 2 Cir., 74 F.2d 215, 219; O'Connell v. United States, 2 Cir., 40 F.2d 201; Mattes v. United States, 3 Cir., 79 F.2d 127, 128. This much the appellant concedes. He claims, however, that under the facts and circumstances disclosed by the record, the waiver was obtained without understanding of its...