State v. McDonald

• Decision Date: 03 November 1903
• Citation: 45 S.E. 582,133 N.C. 680
• Parties: STATE v. McDONALD.
• Court: North Carolina Supreme Court

45 S.E. 582

133 N.C. 680

STATE v. McDONALD.

Supreme Court of North Carolina

November 3, 1903

Appeal from Superior Court, Wake County; Peebles, Judge.

Charles C. McDonald was convicted of embezzlement, and he appeals. Reversed.

On a prosecution for embezzlement it is error to instruct that an appropriation of money alone raises a fraudulent intent, and casts on accused the burden to rebut the presumption, and that, as accused introduced no evidence, he failed to rebut the presumption.

Womack & Hayes and Douglass & Simms, for appellant.

The Attorney General, for the State.

WALKER J.

The defendant was indicted in the court below for the crime of embezzlement, and, having been convicted, appealed to this court. It is alleged in the indictment that he was the agent of the Supreme Lodge of Knights of Honor, and that he did fraudulently, corruptly, and feloniously embezzle and convert to his own use $500, which had been received by him as agent and intrusted to his care for the said lodge. By consent of the state and the defendant, certain facts were agreed upon for the purpose of being embodied in a special verdict. They were to the effect that defendant had been irregularly appointed financial reporter for Oak City Lodge in 1895, and assumed the duties of said office, and acted as reporter until June, 1901. Defendant collected all assessments from the members of the said lodge, and remitted them to the grand lodge, until May, 1900. In April, 1900, he collected the assessments, and deposited them to his individual credit in a bank in Raleigh, and drew the money out for his personal use the amount so drawn out being about $1,200. He paid nothing to the supreme lodge after April, 1900. In July, 1901, with money borrowed from another bank in the said city, he paid back to the members of Oak City Lodge the amount of the assessments collected by him. When asked why he did not send the assessments to the supreme lodge, the defendant replied that "he did not remit them because he got in a position that he could not do so." There were other facts agreed upon and stated in the special verdict, but it is not necessary to set them out, as, in the view we take of the case, those already stated are sufficient to present the point upon which our decision must turn.

There was one disputed question submitted to the jury with the understanding that the finding thereon should be incorporated with the other facts, and that the facts so agreed upon and the said finding of the jury upon the issue submitted to them should constitute the special verdict. That disputed question was whether the defendant appropriated the amount of the assessments collected by him with the intent to defraud the supreme lodge. The jury found that he did, and the court, being of opinion that upon the special verdict as thus rendered by the jury the defendant was guilty, the verdict was so entered, and judgment rendered thereon, from which the appeal was taken.

Upon the question of intent the defendant requested the court to give the following instructions: "(1) That the felonious intent is an essential element of embezzlement, and must be shown by the state beyond a reasonable doubt; and, unless the state has so shown, the jury will find the defendant not guilty. (2) That the intent with which the offense was committed is for the jury, and not for the court." These instructions were refused, and the court charged the jury: "That there was an appropriation of the money by the defendant to his own use, and that the law raised the presumption, as a matter of fact, that it was done with a fraudulent intent, and put the burden upon the defendant to rebut that presumption; that the defendant might have gone upon the witness stand and said he had no such intent, and then it would have been for the jury to say whether they believed his statement or not; but that the defendant had introduced no evidence, and hence he had failed to rebut the presumption before mentioned, and, if the jury believed the evidence, they should answer 'Yes' to the issue." We think the court erred in not giving the instructions asked by defendant, and also in charging the jury that the defendant had introduced no evidence and hence he had failed to rebut the presumption of a fraudulent intent raised by the law from the act of conversion of the funds, and that, if the jury believed the evidence, they should answer the first issue "Yes." It is admitted in the record that at the time the defendant agreed to the other facts in the special verdict his counsel stated that he did not waive the full benefit of the prayers for instructions above mentioned, and that he would insist on all of his legal rights as to the special issue submitted, and the rights of the defendant were accordingly reserved.

The crime of embezzlement is the fraudulent conversion of property by one who has lawfully acquired possession of it for the use and benefit of the owner. Embezzlement was not a common-law offense. State v. Hill, 91 N.C. 561. It was first made a criminal offense in England by statute (21 Henry VIII, c. 7) to punish the appropriation by servants of the property of their masters in violation of the trust and confidence reposed in them. 1 McLain, Cr. Law, § 621. It was enacted in consequence of a decision that a banker's clerk, who received money from a customer, and appropriated it to his own use, could not be convicted of larceny, on the ground that the money had never been in the employer's possession. Clark's Cr. Law, p. 308. It was made a crime in this state by Code, § 1014. The general object of these statutes was to punish the misappropriation of property rightfully in the possession of the alleged wrongdoer, who though civilly liable for a conversion, could not be convicted of larceny, because there was no taking from the owner's possession by an act of trespass. The only difference, therefore, between larceny and embezzlement is that in the former there must be a trespass, while in the latter that is not necessary. Embezzlement is to all intents and purposes larceny without the ingredient of a trespass. In both offenses the act of taking or converting must be done with a fraudulent or felonious intent. In embezzlement there must have been not only a relation of trust and confidence between the owner and the person who is charged with the conversion, but the property must have been appropriated with a fraudulent purpose. Clark's Criminal Law, § § 99, 100. We think, therefore, that the conversion of funds by a person who has been intrusted with them becomes criminal as an embezzlement only by reason of this corrupt intent, and it is as necessary for the state to establish the intent as a fact independent of the conversion as it is to prove the bad intent in a prosecution for larceny as a fact apart from the taking. The intent to defraud is no more implied in a case of embezzlement than the felonious intent is from the act of taking in a case of larceny. There is a perfect analogy between the two offenses in all respects except that in one of them a trespass, either actual or constructive, must have been committed, which is not required in the other, its place being supplied by the relation of trust and confidence between the parties; and, as this difference has nothing to do with the question of intent, there is no good reason why proof of the intent in the one case should not be governed by the same principles as in the other, for, where there is the same reason, there is necessarily...