State v. Frasher

Decision Date01 April 1980
Docket NumberNo. 13855,13855
Citation164 W.Va. 572,265 S.E.2d 43
CourtWest Virginia Supreme Court
PartiesSTATE of West Virginia v. Eddie A. FRASHER.

Syllabus by the Court

1. "(I)n order to constitute the crime of embezzlement, it is necessary to show, (1) the trust relation of the person charged, and that he falls within that class of persons named; (2) that the property or thing claimed to have been embezzled or converted is such property as is embraced in the statute; (3) that it is the property of another person; (4) that it came into the possession, or was placed in the care, of the accused, under and by virtue of his office, place or employment; (5) that his manner of dealing with or disposing of the property, constituted a fraudulent conversion and an appropriation of the same to his own use, and (6) that the conversion of the property to his own use was with the intent to deprive the owner thereof." Syllabus Point 2, State v. Moyer, 58 W.Va. 146, 52 S.E. 30 (1905).

2. "On the trial of one charged with the larceny or embezzlement of goods proof of actual or constructive possession of the goods by the one alleged in the indictment to be the owner thereof is sufficient." Syllabus Point 2, State v. DeBerry, 75 W.Va. 632, 84 S.E. 508 (1915).

3. "The agency of one charged with the embezzlement of money or other property, under (the statute), is sufficiently established by evidence showing that the agency related to but the single transaction of intrusting the property embezzled to the defendant; no previous relationship of principal and agent is necessary. The agency thus established is within the statute on embezzlement, whether the contract of agency provides for compensation or not." Syllabus Points 3 and 4, State v. Fraley, 71 W.Va. 100, 76 S.E. 134 (1912).

4. "The exceptions permitting evidence of collateral crimes and charges to be admissible against an accused are recognized as follows: the evidence is admissible if it tends to establish (1) motive; (2) intent; (3) the absence of mistake or accident; (4) a common scheme or plan embracing the commission of two or more crimes so related to each other that proof of one tends to establish the others; and (5) the identity of the person charged with the commission of the crime on trial." Syllabus Point 12, State v. Thomas, W.Va., 203 S.E.2d 445 (1974).

5. For evidence of the guilt of someone other than the accused to be admissible, it must tend to demonstrate that the guilt of the other party is inconsistent with that of the defendant.

6. Ordinarily, the hearsay rule precludes admitting into evidence out-of-court statements made by a third party where such statements are offered to prove the truth of the matter asserted, unless such statements fall within recognized exceptions to the hearsay rule.

Lewis, Ciccarello, Masinter & Friedberg and Arthur T. Ciccarello, Charleston, for plaintiff in error.

Chauncey H. Browning, Jr., Atty. Gen., Ronald A. Shipley, Asst. Atty. Gen., Charleston, for defendant in error.

MILLER, Justice:

Eddie A. Frasher appeals his embezzlement conviction from the Circuit Court of Kanawha County. His primary assignments of error are that the State failed to prove that the true owner's property was embezzled and that he was an agent within the meaning of the embezzlement statute, W.Va.Code, 61-3-20. Other assigned errors relate to rulings of the trial court on evidentiary points and instructions.

The defendant Frasher operated a business known both as Frasher's Mail Service and Frasher License and Title Service. The chief function of the business was to expedite for automobile dealers the obtaining of automobile titles for the dealers' purchasers.

The transactions here involved an arrangement between Frasher's business and an automobile dealer, Parkersburg Datsun, Inc. (Datsun). The record establishes that the defendant's wife would obtain the title applications and the dealer's check covering the title taxes and license fees and deliver the documents to Frasher in Charleston, who would present them to the Department of Motor Vehicles, obtain the title certificates and license plates, and return them through his wife to the dealer.

Datsun would make its check payable either to the defendant Frasher, his wife or to the business itself for the total amount of title taxes and license fees due on the various title applications turned over to the Frashers. These checks would then be deposited by the Frashers and, in turn, new checks would be drawn by the defendant on his business account made payable to the Department of Motor Vehicles to cover the fees and tax costs.

The basis for the embezzlement charge was that there had been an alteration of the title applications by the defendant which lowered the stated value of the motor vehicles, thereby reducing the amount of the license taxes due under W.Va.Code, 17A-3-4. 1 As a consequence, it was alleged that the defendant paid a lower amount of title tax and retained the difference. The indictment was substantially in accord with the statutory form, W.Va.Code, 62-9-11, and alleged that the defendant embezzled the sum of $1,546.75 of "bullion, money, bank notes, drafts, securities for money and other effects and property of and belonging to the said Parkersburg Datsun, Inc."

I

The threshold question raised by the defendant is whether the embezzlement indictment was insufficient in charging that he embezzled from Datsun as distinguished from Datsun's purchasers. The defendant urges that Datsun was a mere conduit for paying to the Department of Motor Vehicles (Department) the title taxes and license fees owed by the individual purchasers, and that the indictment was insufficient in that it had to charge embezzlement from the purchasers themselves. Defendant contends alternatively that, because the purchasers in fact received their titles, the State itself is the only party who actually suffered a loss, and thus that there was no embezzlement at all, but at most an act of fraud against the State under W.Va.Code, 61-3-22. We need not deal with this latter proposition, as under the law the defendant could be charged with embezzling from Datsun.

The record demonstrates that Datsun added the automobile title taxes and fees to the purchase price of the vehicle and charged the purchaser the total sum. Datsun did not earmark the tax money or segregate it in any manner, but commingled it with other funds in its bank account. Datsun's office manager wrote checks on the Datsun bank account to pay to Frasher the taxes and fees due the Department. The defendant had no agreement with the individual purchasers to pay the title taxes and fees, but solely with Datsun.

For all practical purposes, therefore, the checks presented to Frasher represented Datsun's money, or at least money held by Datsun as a fiduciary for the automobile purchaser. On these facts, to characterize Datsun as simply a "conduit" is meaningful only if the law requires that an embezzlement can occur only from the actual owner of the property, and not simply from the individual or entity that is the ostensible legal possessor of the property.

We considered our embezzlement statute in State v. Moyer, 58 W.Va. 146, 52 S.E. 30 (1905), and in Syllabus Point 2 set out the elements of the crime:

"(I)n order to constitute the crime of embezzlement, it is necessary to show, (1) the trust relation of the person charged, and that he falls within that class of persons named; (2) that the property or thing claimed to have been embezzled or converted is such property as is embraced in the statute; (3) that it is the property of another person; (4) that it came into the possession, or was placed in the care, of the accused, under and by virtue of his office, place or employment; (5) that his manner of dealing with or disposing of the property, constituted a fraudulent conversion and an appropriation of the same to his own use, and (6) that the conversion of the property to his own use was with the intent to deprive the owner thereof."

We also stated in Moyer that embezzlement is a purely statutory offense, since:

"It was unknown to the common law, and the statute was enacted for the purpose of supplying what were regarded as defects in the common law of larceny, so as to reach and punish for the fraudulent conversion of money or property which could not be reached by the common law. . . . The distinction between embezzlement and larceny is that embezzlement is the wrongful conversion of property without trespass, or where the original taking and possession is lawful. In order to constitute the offense, it is necessary that the property embezzled should come lawfully into the hands of the party embezzling, and by virtue of the position of trust he occupies to the person whose property he takes. . . ." (58 W.Va. at 149, 52 S.E. at 32).

This is a generally recognized legal principle. See 26 Am.Jur.2d Embezzlement §§ 1-3; 29A C.J.S. Embezzlement §§ 2, 4; W. LaFave & A. Scott, Criminal Law § 89 (1972), at 644 et seq.

Moyer demonstrates that the hallmark of embezzlement is the trust relationship and the subsequent conversion or appropriation of the entrusted property. See State v. Riley, 151 W.Va. 364, 390, 151 S.E.2d 308, 324 (1966). As in larceny, the taking of the property need not be from the actual owner of the property, but may be from one who has lawful possession of it. In State v. Workman, 91 W.Va. 771, 114 S.E. 276 (1922), a county commissioner was charged with embezzling county funds. He and another commissioner had voted to authorize the purchase of a farm and had an arrangement with the owner to receive a kickback from the proceeds. Workman argued that he never had the funds in his actual possession, since the sheriff honored the commission's warrant from funds over which the sheriff had exclusive control and which were on deposit in a local bank. We held actual possession not to be necessary:

"That fund was under...

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