State v. Lindberg

• Decision Date: 14 May 1923
• Docket Number: 17542.
• Citation: 215 P. 41,125 Wash. 51
• Court: Washington Supreme Court
• Parties: STATE v. LINDBERG.

215 P. 41

125 Wash. 51

STATE v. LINDBERG.

No. 17542.

Supreme Court of Washington, En Banc.

May 14, 1923

Appeal from Superior Court, Pierce County; W. O. Chapman, Judge.

Gustav Lindberg was convicted of violating the state banking act and he appeals. Affiremd.

Ellis Fletcher & Evans and Remann & Gordon, all of Tacoma, for appellant.

J. W Selden, J. A. Sorley, and Rex S. Rondebush, all of Tacoma, for the State.

FULLERTON J.

The appellant, Gustav Lindberg, was convicted of a violation of the state banking act, and appeals from the judgment and sentence pronounced upon him.

The Scandinavian American Bank of Tacoma was a banking corporation organized under the laws of this state. The appellant was a stockholder therein and a director thereof, and while such director borrowed from the bank on his unsecured note the sum of $13,000. The bank subsequently became insolvent, and was taken over by the state banking officers for liquidation. The note was then unpaid, and was found pledged as security with other notes of the bank for a loan made to the bank by another banking corporation. The particular provision of the statute which the appellant was charged with violating is found at section 3259, of Remington's Compiled Statutes, and reads as follows:

'No bank or trust company shall, nor shall any officer or employee thereof on behalf of such corporation, directly or indirectly, loan any sum of money to any director, officer or employee of such corporation, unless a resolution authorizing the same and approved by a majority of the directors, at a meeting at which no director, officer or employee to whom the loan is to be made shall be present, shall be entered in the corporate minutes.

'Every director and officer of any bank or trust company who shall borrow or shall knowingly permit any of its directors, officers or employees to borrow, any of its funds in an excessive amount or in violation of the provisions of this section, shall be personally liable for any loss or damage which the corporation, its shareholders or any person may sustain in consequence thereof, and shall also be guilty of a felony.'

The information, on which the appellant was convicted, charges that the appellant, while a director of the bank named, borrowed the money therefrom without a resolution authorizing the same, approved by a majority of the directors of the bank at a meeting at which he was not present and entered in the corporate minutes of the bank.

Taking up the errors assigned in the order in which the appellant presents them, the first to be noticed is the assignment that the court erred in overruling his motion for a change of venue, or, in the alternative, to call in a judge from another county to try the cause. The appellant did not support his motion by his own affidavit, but filed therewith the affidavit of one of his attorneys only. This affidavit is uncontroverted and contains recitals from which it can be inferred that prejudice to some extent existed in certain parts of the county against the officers generally of the particular bank, and were the question one on which this court could exercise an independent judgment, we are free to say that it would be permissible to reach a conclusion different from that reached by the trial court. But the question is not one of first instance in this court. By the express provisions of the statute (Rem. Comp. Stat. §§ 2018, 2019) the question is vested in the first instance in the discretion of the trial court, and we can review its ruling only for gross abuse. As we said in State v. Welty, 65 Wash. 244, 118 P. 9, and repeated in part in the later case of State v. Wright, 97 Wash. 304, 166 P. 645:

'It is apparent, from a reading of these sections, that the granting or denying of the change of venue is a matter resting entirely in the sound judicial discretion of the trial judge. Such being the statute, the ruling of the trial court cannot be reversed upon appeal, unless the record contains some evidence of its gross abuse, or it is shown that the court's ruling was arbitrary. Such has been our holding whenever such a question has been before us. McAllister v. Washington Territory, 1 Wash. Ter. 360; Edwards v. State, 2 Wash. 291, 26 P. 258; State v. Straub, 16 Wash. 111, 47 P. 227; State v. Champoux, 33 Wash. 339, 74 P. 557. Such also is the general rule in construing statutes of like import. 12 Cyc. 243. The rule is not only based upon the statute, but is founded in reason. The trial judge is generally familiar with the local situation; he knows the prevailing sentiment of the people, in so far as it finds oft repeated expression; he knows all the facts and circumstances proper to be considered in determining the matter; he may know the persons who make affidavits suggesting undue excitement or prejudice and can properly estimate the weight to be given such affidavits. A judicial discretion, exercised under such circumstances, should not be interfered with, unless its abuse is so clearly manifest as to call for a reversal.'

Looking to the record, we find nothing warranting the holding that that court grossly abused its discretion. In addition to the fact that it would seem, if the prevalent prejudice was widespread, a more extended showing of it could readily have been made, there is no showing that the appellant did not obtain an impartial jury; at least, nothing of the voir dire examination of the jury is in the record, nor is it shown that the appellant, in the selection of the jury, was compelled to exhaust his peremptory challenges. The purpose of a change of venue is to secure to the accused a trial before an impartial jury, and if the record does not disclose affirmatively that the accused did not have such a trial, it is very persuasive of the fact that the trial court did not err in denying the change. The case from this court principally relied upon by the appellant, State v. Hillman, 42 Wash. 615, 85 P. 63, is much stronger in its facts than is the present case. Not only was there a showing by an affidavit signed by some thirty persons, and, in addition, numerous newspaper articles showing a widespread prejudice against the accused, but this prejudice was reflected in the voir dire examinations of the jurors called to sit in trial of the cause.

The ruling on the second ground of the motion was also without reversible error. There was no affidavit of prejudice filed against the trial judge under the special statute (Rem. Comp. Stat. §§ 209-1, 209-2), nor any showing that the judge sitting was prejudiced against the accused as a matter of fact. Whether therefore the court would call in a judge from an outside county to hear the cause was wholly a matter within its discretion.

A demurrer to the information was filed and overruled, and the second assignment of error is based upon this ruling. The appellant argues that the prohibition of the statute cited is directed against an officer who loans the funds of the bank, and not against an officer who borrows such funds. But without pursuing the appellant's line of reasoning, it seems clear to us that the prohibition is directed against both of such officers. It will be noticed from the quotation of the section made that the Legislature has divided it into two paragraphs. The first of these is directed against loaning the funds of the bank to its officers without certain requirements. The second, when stripped of its qualifying phrases applicable to other situations, reads as follows:

'Every director and officer of any bank * * * who shall borrow * * * any of its funds * * * in violation of the provisions of this section * * * shall * * * be guilty of a felony.'

Clearly to our minds this is a provision directed against the borrowing officer, and makes him guilty of a felony, if the borrowing is in violation of the provisions of the act. Contrary to the contention of the appellant, we are not persuaded that this construction of the statute makes an officer of a bank guilty of a felony who is innocent of wrong. A director who applies for a loan from his bank is not, it is true, permitted to be present when the application is passed upon by the board of directors, but he is bound, nevertheless, to know the result of their action. It is a matter of record to which he has access. To fail to note it is negligence. The requirement is for the protection of the public, and it would be against the policy of the law to permit a director of a bank, in defense of a charge of felonious borrowing from his bank, to plead that he was erroneously informed of the action of the bank.

Nor was it necessary that the state allege and prove a financial loss as a result of the borrowing. By the terms of the statute the crime is complete when the borrowing is consummated without a compliance with the statutory requirements; loss of the money borrowed is not an element of the offense.

The third assignment, and the one to which the arguments are principally directed, is that the court erred in the exclusion of evidence offered by the appellant material to his defense. The evidence on the part of the state showed that the loan was actually made by the bank in which the appellant was a director. The appellant offered testimony tending to show that he had no knowledge of this fact, and was led to believe, by the manager of the bank, that the fact was otherwise. Stating his offer in its most most favorable light, in substance it is this: That in the early months of the year 1920, he began negotiations with one Connelly to purchase certain timber land, the consummation of which would require him to pay Connelly a considerable sum of money estimated then to be approximately $22,000, which sum he would be obligated to borrow; that the bank in which he was...