State v. Homewood, No. 17974

CourtUnited States State Supreme Court of South Carolina
Writing for the CourtBUSSEY; TAYLOR
Citation241 S.C. 231,128 S.E.2d 98
PartiesThe STATE, Respondent, v. A. L. HOMEWOOD, Appellant.
Decision Date10 October 1962
Docket NumberNo. 17974

Page 98

128 S.E.2d 98
241 S.C. 231
The STATE, Respondent,
v.
A. L. HOMEWOOD, Appellant.
No. 17974.
Supreme Court of South Carolina.
Oct. 10, 1962.

Page 100

[241 S.C. 234] James P. Mozingo, III, Greer & Chandler, Darlington, for appellant.

[241 S.C. 235] Atty. Gen. Daniel R. McLeod, Asst. Atty. Gen. Victor S. Evans, Asst. Sol. John W. Foard, Jr., Columbia, for respondent.

[241 S.C. 236] BUSSEY, Justice.

The defendant, appellant here, was indicted for violation of Sections 12-10 and 62-306 of the 1952 Code of Laws of South Carolina. The jury acuitted him as to violation of Section 12-10, but found him guilty as to violation of Section 62-306. A motion for a new trial was refused and a sentence of one year imprisonment was imposed upon the defendant.

The prosecution of the defendant arose out of alleged conduct on his part while president and treasurer of the Francis Marion Life Insurance Company, which for convenience will be referred to simply as the company. The company had its home office at Columbia, South Carolina and was organized by the defendant and others on May 21, 1956, and chartered by the Secretary of State on June 14, of that [241 S.C. 237] year. In connection with the organization of the company, the defendant subscribed to 238,830 shares of the company's capital stock at a par value of $1.00. At the organizational meeting of the company on May 21, 1956, the following resolution was adopted:

'Resolved, that the unpaid balance due from A. L. Homewood to the corporation for the shares of stock subscribed for by him shall be due and payable to the corporation no later than May 21, 1961, and that no interest shall be paid upon the unpaid balance, and in the event the said balance shall not be paid on or before May 21, 1961, then and in such event the stock subscription for the unpaid shares shall be null, void and of no effect.'

In addition to being president-treasurer of the company, the defendant was given the exclusive right by the company to sell authorized issues of the capital stock of the company to the general public. He was registered as a securities dealer in the State of South Carolina on June 19, 1956, and maintained his registration for several years thereafter. Various persons who sold capital stock of the company were registered as agents for the defendant A. L. Homewood.

After the organization of the company, an offering of 150,000 shares of its capital stock was made to the public at $6.00 per share; and later it made another offering at $9.00 per share, both the $6.00 and $9.00 offerings being made on the basis of prospectuses, each of which indicated new issues of common stock. With respect to the $6.00 issue, the prospectus showed the price per share to be $6.00, a sales commission of 60cents, and a net of $5.40 to the company. With respect to the $9.00 issue, the prospectus showed a sales price of $9.00, a sales commission of 90cents, and a net of $8.10 to the company. Both prospectuses showed that any net to the company in excess of $1.00 per share, the par value of the stock, would represent surplus to the company.

The State offered evidence of the sale of stock upon the two prospectuses by various persons licensed as agents of [241 S.C. 238] the defendant to members of the public, and evidence to the effect that the various agents had been instructed by the defendant as to the method and manner of sale of capital stock by said agents. The State further offered evidence tending to prove that when various of such sales were made, the company did not receive the benefit of the surplus as represented on the prospectus.

The evidence reflects several variations in the manner and method of issuing the capital stock sold upon the said prospectuses. The defendant admittedly had paid for and had issued to him some of the shares of

Page 101

stock which he was entitled to purchase under his original subscription, paying therefor $1.00 per share. Upon sales to the public, in some instances, instead of new stock being issued to the purchaser, shares were issued to the purchaser at the increased price and transferred from stock already owned by the defendant.

In other instances with, respect to the $6.00 issue, the purchaser would, for instance, pay into the company $600.00 for which he would be issued one hundred shares and coincidentally therewith the defendant would be issued five hundred shares, which five hundred shares would be charged against the original subscription account of the defendant, with only the $600.00 paid by the purchaser going into the treasury of the company. With respect to the $9.00 issue, the purchaser would, for instance, pay to the company $900.00, with one hundred shares being issued to the purchaser and eight hundred shares being issued to the defendant and charged against his original subscription account, but with only $900.00 going into the company treasury in connection with the whole transaction. From the shares thus issued to the defendant, there was evidence of subsequent transfers to purchasers under the prospectuses.

Briefly summarized, the State contended and offered evidence tending to prove that through December 31, 1960 the defendant was issued 39,205 shares of capital stock directly by the company and that he had acquired 21 shares from other people, making a total of 39,226 shares issued in his [241 S.C. 239] name; that there were 8,759 shares transferred from defendant's holdings to purchasers in lieu of previously unissued stock during the period the stock was selling for $6.00 per share, and that 3,924 shares of his holdings were similarly transferred during the time the stock was selling for $9.00 per share; that after these various transfers, as of December 31, 1960, he still owned 26,723 shares and that the records of the company failed to show where he had paid for more than 7,540 shares at the original subscription price of $1.00 per share, or any other price, it being admitted by the State that he had paid in the sum of $7,540.00.

Except for offering and attempting to offer through the State's witnesses on cross-examination certain documentary evidence, some of which will be hereinafter mentioned, the defendant proffered no defense.

Section 62-306 of the 1952, Code, which the defendant was convicted of violating, makes unlawful 'The use or employment by any person of any fraud, fraudulent act, fraudulent practice or fraudulent transaction or of any device, scheme or artifice to defraud or to obtain money or property by means of any false pretense, representation or promise, in connection with the sale within or from this State of any security, * * *.'

The defendant alleges numerous errors below, one of them being that the trial judge should have directed a verdict in that the evidence was insufficient to support a conviction. The foregoing summary of the evidence adduced on behalf of the State as to the violation of Section 62-306 by the defendant, shows this exception to be clearly without merit.

The defendant alleges error on the part of the court below in refusing a motion for a continuance. Defendant's motion was based on the fact that one Walter G. Wilson, who served briefly as president of the company after defendant's official connection therewith was severed, and who at the time of the trial as secretary-treasurer of the company was [241 S.C. 240] engaged in making an audit which would 'inquire into the stock transactions, among other things, of the company', the defendant contending that he should have the benefit of that particular audit to better prepare his case for trial. It appeared that the audit by Mr. Wilson could not be concluded for another week or so after the commencement of the trial.

While the record is not clear as to just what was said or done on the day prior to

Page 102

the trial, it appears that the motion for continuance was then first made, and renewed on the day the trial commenced. Apparently, when the motion was first made, mention of or reference to an unspecified audit was made and the judge at chambers directed or suggested that defense counsel be furnished a copy of any audit which the State might be in possession of. It does not appear that any audit of the stock transactions involved in this case had been made and completed by anyone at the time, although Camp, an employee of the Insurance Commissioner's office, had made or conducted an investigation and was possessed of at least certain notes or memoranda as to what he had found. In any event, as the result of whatever transpired between counsel and the court the day prior to the trial, there was furnished to counsel for the defense that night a report of a routine examination of the affairs of the company for the year 1960, made by one J. C. Gayle who was an examiner employed by the South Carolina Insurance Department. This report, 'Defendant's Exhibit for Identification No. 2', will be hereinafter referred to an another point.

In renewing the motion for continuance, counsel for the defense took the position that the State had not furnished the defense what counsel contended that the court had instructed the State to deliver. Whatever may have transpired between the court and counsel on the previous day, the record does not reflect that there was in existence at the time a complete audit in anything like final or concise form with respect to the stock transactions involved in the case.

[241 S.C. 241] The circuit judge denied the motion for continuance on the ground that the case had been pending from March to September during which time counsel for defendant admittedly had made no effort to examine the books of the company with reference to stock transactions. In addition to no effort being made by counsel to see the books, as far as the record goes, the defendant was still a stockholder of the company during this interim of time with the right to inspect the books of the company at all times. See Section 12-263...

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8 practice notes
  • State v. Mizell, No. 2872.
    • United States
    • Court of Appeals of South Carolina
    • July 20, 1998
    ...State v. Greene, 255 S.C. 548, 180 S.E.2d 179 (1971) (error without prejudice is not basis for granting new trial); State v. Homewood, 241 S.C. 231, 128 S.E.2d 98 (1962) (admissibility of testimony is largely within discretion of trial judge and his exercise thereof will not be disturbed on......
  • State v. Young, No. 18117
    • United States
    • United States State Supreme Court of South Carolina
    • November 4, 1963
    ...abuse of such discretion to the prejudice of the appellant. State v. Britt, et al., 235 S.C. 395, 111 S.E.2d 669, and State v. Homewood, 241 S.C. 231, 128 S.E.2d 98. In the cases of State v. Francis, 152 S.C. 17, 149 S.E. 348, 70 A.L.R. 1133; State v. Rickenbaker, 138 S.C. 24, 135 S.E. 651;......
  • Grice v. Dickerson, Inc., No. 17977
    • United States
    • United States State Supreme Court of South Carolina
    • October 23, 1962
    ...350, 70 S.E.2d 553. Here, reliance was not upon medical testimony alone to show causal connection between the injury and the subsequent [241 S.C. 231] disability of the claimant, but rather in addition upon the circumstances surrounding the injury and the events which followed. The medical ......
  • South Carolina State Highway Dept. v. Sharpe, No. 18071
    • United States
    • United States State Supreme Court of South Carolina
    • May 16, 1963
    ...cases of Rogers v. Florence Printing Co., 233 S.C. 567, 106 S.E.2d 258; McCrae v. McCoy, 214 S.E. 343, 52 S.E.2d 403; State v. Homewood, 241 S.C. 231, 128 S.E.2d The question before us, therefore, becomes simply whether or not there was an abuse of discretion on the part of the trial judge ......
  • Request a trial to view additional results
8 cases
  • State v. Mizell, No. 2872.
    • United States
    • Court of Appeals of South Carolina
    • July 20, 1998
    ...State v. Greene, 255 S.C. 548, 180 S.E.2d 179 (1971) (error without prejudice is not basis for granting new trial); State v. Homewood, 241 S.C. 231, 128 S.E.2d 98 (1962) (admissibility of testimony is largely within discretion of trial judge and his exercise thereof will not be disturbed on......
  • State v. Young, No. 18117
    • United States
    • United States State Supreme Court of South Carolina
    • November 4, 1963
    ...abuse of such discretion to the prejudice of the appellant. State v. Britt, et al., 235 S.C. 395, 111 S.E.2d 669, and State v. Homewood, 241 S.C. 231, 128 S.E.2d 98. In the cases of State v. Francis, 152 S.C. 17, 149 S.E. 348, 70 A.L.R. 1133; State v. Rickenbaker, 138 S.C. 24, 135 S.E. 651;......
  • Grice v. Dickerson, Inc., No. 17977
    • United States
    • United States State Supreme Court of South Carolina
    • October 23, 1962
    ...350, 70 S.E.2d 553. Here, reliance was not upon medical testimony alone to show causal connection between the injury and the subsequent [241 S.C. 231] disability of the claimant, but rather in addition upon the circumstances surrounding the injury and the events which followed. The medical ......
  • South Carolina State Highway Dept. v. Sharpe, No. 18071
    • United States
    • United States State Supreme Court of South Carolina
    • May 16, 1963
    ...cases of Rogers v. Florence Printing Co., 233 S.C. 567, 106 S.E.2d 258; McCrae v. McCoy, 214 S.E. 343, 52 S.E.2d 403; State v. Homewood, 241 S.C. 231, 128 S.E.2d The question before us, therefore, becomes simply whether or not there was an abuse of discretion on the part of the trial judge ......
  • Request a trial to view additional results

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