Smith v. United States, 10570.

• Decision Date: 21 June 1948
• Docket Number: No. 10570.,10570.
• Citation: 169 F.2d 118
• Parties: SMITH v. UNITED STATES.
• Court: U.S. Court of Appeals — Sixth Circuit

169 F.2d 118 (1948)

SMITH v. UNITED STATES.

No. 10570.

Circuit Court of Appeals, Sixth Circuit.

June 21, 1948.

Henry C. Lavine, of Cleveland, Ohio, for appellant.

Marcus L. Friedman, of Toledo, Ohio (Don C. Miller, of Cleveland, Ohio, and Marcus L. Friedman, of Toledo, Ohio, on the brief), for appellee.

Before MARTIN, McALLISTER, and MILLER, Circuit Judges.

MARTIN, Circuit Judge.

Appellant, J. Robert D. Smith, was sentenced to three years' imprisonment upon conviction by jury verdict of wilful and corrupt perjury in violation of section 125 of the Criminal Code, Title 18, section 231, U.S.C.A. He insists that the District Court committed reversible error in overruling his motion for a directed verdict of acquittal and in declining to discharge him for the alleged reason that there was insufficient evidence of perjury to justify submission of the case to the jury.

The indictment upon which he was convicted charged that, on February 19, 1947, Smith committed wilful and corrupt perjury in testifying under oath before Norman Joss, a special agent for the Intelligence Unit, Bureau of Internal Revenue of the Treasury Department. It was charged that his testimony was material to the investigation then being conducted by that official. The indictment charged specifically that Smith swore falsely that, on the date mentioned, he had no accounts or monies to his credit with, or in the hands of, any brokerage firm in Toledo, Ohio, or elsewhere; whereas, in fact, appellant well knew that he had a credit or cash balance of $11,823.09 with the brokerage firm of Bell and Beckwith in Toledo. It was further charged in the indictment that the false statement of appellant was made for the purpose of defrauding and deceiving the United States Government, which, at the time, had against him a claim in excess of $100,000 for unpaid income taxes due and owing by Smith.

Concededly, Special Agent Norman Joss possessed the essential legal qualifications to administer the oath to appellant, and did so. It cannot be denied that the testimony given before him by appellant was material to the official investigation being conducted. Moreover, the agent informed appellant of his constitutional right not to testify or give incriminating evidence against himself.

Appellant was interrogated in the presence of Willard Rutchow, Deputy Collector of Internal Revenue at Toledo and Mrs. Alma E. White of the Intelligence Unit of the Bureau of Internal Revenue at Toledo. Mrs. White recorded in shorthand the questions asked appellant and the answers given by him. She subsequently transcribed her shorthand notes; and both the original notes and the transcribed record were introduced in evidence at the trial.

After the appellant had been questioned concerning his income from all sources for the years 1944, 1945, and 1946, and as to where he might have had money on deposit, it appears from the testimony of Joss and that of Mrs. White that Joss asked appellant Smith this question: "Do you carry any brokerage accounts with any bond houses?" The appellant answered: "No, Sir." The indictment rests upon the charge that this answer constituted wilful and corrupt perjury.

To prove that the sworn statement of appellant was false, the Government introduced as a witness William J. Smith, custodian of books and records of Bell and Beckwith of Toledo, commission brokers holding a membership on the New York Stock Exchange. He testified that appellant originally opened an account with his firm on December 19, 1945; closed it on January 8, 1946; reopened it on November 18, 1946, for deposit of two hundred shares of General Motors stock; and that, on February 19, 1947, the crucial date, appellant J. Robert D. Smith had a credit balance with Bell and Beckwith of $11,823.09, which had been credited to his account on February 6, 1947, from the proceeds of the sale on that date by appellant's order of the two hundred shares of General Motors stock belonging to him. The witness testified further that the account thus remained open continuously until June 26, 1947, when the money was paid to the Collector of Internal Revenue at Toledo pursuant to notice of levy under date of the preceding day.

The broker, who at the time he testified, was a member of the firm of Bell and Beckwith, stated that on February 6, 1947, Attorney Eugene Howard telephoned him that his client, J. Robert D. Smith, wished to sell his General Motors stock, which was on deposit with Bell and Beckwith. The broker told the attorney that he desired direct instructions from the appellant, who then took the telephone and gave instructions to sell the stock at the market. The witness was positive in his statement that he recognized the voice of appellant.

He testified further that, around the time the money was received from the sale of the stock, he read in newspapers that the Government had filed levies and distraint warrants against appellant; whereupon, he sought legal counsel and was advised to freeze the account. When appellant, accompanied by his attorney on February 6, 1947, came to withdraw the proceeds of the stock sale, he was told that the Government had seized the money and that he could not get it; that the account was frozen. There was some confusion in the testimony of the witness as to whether his firm was holding the money for the United States Government or for appellant; but, on redirect examination, the broker stated that, as far as the account with his brokerage firm was concerned, the money realized from the General Motors stock was the property of appellant.

William Rutchow, Deputy Collector of Internal Revenue at Toledo, was presented as a Government witness. He swore that, on January 29, 1947, four warrants for distraint were issued for the purpose of reaching all property of appellant; that, altogether, some thirty different levies were filed against him as assets came to light; and that the levy filed upon the funds belonging to appellant on deposit with Bell and Beckwith was filed and served on June 26, 1947. This witness corroborated the testimony of Joss and Mrs. White as to answers given by appellant to questions asked him on February 19, 1947, including the assertion by appellant, when questioned by Rutchow that he had no present recollection of buying any General Motors stock; that he had never possessed any in his own name, but had bought some for his mother, who lived in Florida.

The last witness put on the stand by the Government was Joseph M. Drugay, Chief of the Toledo Field Division, Bureau of Internal Revenue. He personally served the notice of levy on Bell and Beckwith demanding that the amount owed by that firm to appellant be applied in payment, pro tanto, upon the amount of $121,909.01, owed by appellant to the United States in internal revenue taxes. He explained that a warrant for distraint is merely a bill for collection presented to the taxpayer. At the conclusion of the Government's proof, appellant moved that the indictment be dismissed and the defendant discharged because of the insufficiency of the indictment. After hearing argument, the court overruled the motion.

Only two witnesses, Eugene Howard and Henry R. Bloch, both lawyers, were introduced by appellant, who did not testify in his own behalf. The District Judge was careful to instruct the jurors that the failure of the defendant to testify should not in any manner whatever prejudice him in their eyes.

Mr. Howard testified to the circumstances under which appellant retained him as one of his attorneys. He asserted that his client told him that he had some General Motors stock which he wanted to dispose of, in order to raise money to make a bond required in connection with litigation with his wife. He testified to the same general effect as did broker William J. Smith concerning the orders to sell the General Motors stock. He said that appellant instructed the broker to sell the stock, send him the money, and close the account; that about two days after the sale there was "a lot of publicity" in local newspapers concerning the issuance of distraint orders and levies against all of appellant's property; and that he received a telephone call from Mr. Bloch, attorney representing Bell and Beckwith. Mr. Bloch stated over the 'phone that he had advised the brokerage firm that, "even though they were not under any order of the Government, they were under notice; and he instructed them not to pay the money; and the account was frozen." Bloch considered the newspaper publicity sufficient notice to the brokers; and declared that the proceeds from the sale of the stock would not be released to appellant "unless we get a release from the Government." He requested Mr. Howard to convey this information to his client. When informed of the brokerage firm's position, appellant, according to the witness, made "some expletive remark: `Well, that is gone' — something to that effect."

The brief testimony of Attorney Bloch brought forward no new matter and was not contradictory, but partly corroborative, of the testimony of the broker, Smith, and that of Mr. Howard.

Appellant contends that his motion for a directed verdict should have been granted, because his answer to the crucial question upon which the indictment was based was "literally accurate, technically correct and legally truthful." He points out that about fifteen days before he made oath that he did not carry any brokerage accounts with any bond houses, he ordered the brokers to sell all his stock, close the account and send him the money; that the brokers complied by selling the stock on February 5, 1947, but wrongfully kept the money against his will and refused to turn it over to him. No other business having been transacted since the sale of the stock, he insists that he was not guilty of perjury in denying that he had a brokerage account on the 19th of February, 1947, inasmuch as the brokers intended to deliver to him the proceeds from...