State v. Paulsen

• Decision Date: 24 April 1912
• Parties: STATE, Appellant, v. AUGUST PAULSEN, Respondent
• Court: Idaho Supreme Court

123 P. 588

21 Idaho 686

STATE, Appellant, v. AUGUST PAULSEN, Respondent

Supreme Court of Idaho

April 24, 1912

CRIMINAL LAW-DIRECTOR OF BANK-FALSE REPORT-INDICTMENT-SUFFICIENCY OF-DEMURRER-CONSTRUCTION OF STATUTE-CHANGING "OR" TO "AND"-CRIME CHARGED-MISDEMEANOR-FELONY.

(Syllabus by the court.)

1. Under the provisions of sec. 7128, Rev. Codes, a person who knowingly makes or publishes in any way whatever, or permits to be so made or published, any book, prospectus, notice report, statement, exhibit or other publication of or concerning the affairs financial condition or property of any corporation, joint stock association copartnership or individual, which said book, prospectus notice, report, statement, exhibit or other publication shall contain any statement which is false or wilfully exaggerated is guilty of a felony.

2. Under the provisions of said section, a person who knowingly makes a report, prospectus, etc., which shall contain any statement that is false or wilfully exaggerated and which is intended to give or which shall have a tendency to give a less or greater apparent value to the shares, bonds or other property of such corporation than such bonds or property shall really and in fact possess, is guilty of a felony.

3. Under the provisions of said section, the indictment involved in this case held to be sufficient to charge the defendant with the crime of a felony, although it did not charge that said false report was intended to give or that it had a tendency to give a less or greater apparent value to the shares, bonds or other property of said corporation than such shares, bonds or other property in fact possessed.

4. Under the provisions of sec. 7121, Rev. Codes, it is made a misdemeanor for a director, officer or agent of a corporation knowingly to concur in making or publishing a false report and by the provisions of sec. 7128, it is made a felony for such person to make a false report, etc. Thus, to concur in making a false report is made a lesser crime than to make a false report.

5. When there is a doubt in the mind of the court in regard to the proper construction of a statute, the court may resort to the title of the act in order to construe the statute and determine the intent of the legislature. But where there is no doubt in the mind of the court, the words and phrases of a statute must be construed according to the context and the approved usage of the language, as directed by the provisions of sec. 15, Rev. Codes.

APPEAL from the District Court of the First Judicial District for Shoshone County. Hon. W. W. Woods, Judge.

The respondent was indicted for making a false report in regard to a bank of which he was a director. A demurrer to the indictment was sustained. This appeal is by the state for the purpose of obtaining a construction of sec. 7128, Rev. Codes. The action of the trial court in sustaining the demurrer held error.

Reversed and remanded.

D. C. McDougall, Attorney General, J. H. Peterson, and O. M. Van Duyn, Assistants to the Attorney General, and James A. Wayne, for Appellant.

The intent of the legislature must be taken from the words used, and where, by accepting the words in their usual sense, the statute is plain, unambiguous and enforceable, the court will enforce the words of the statute and make no substitutions. (Endlich on Interpretation of Statutes, p. 415; 2 Sutherland, Statutory Construction, sec. 390.)

We believe that technical objections to indictments, where such objections do not go to the merits of the case, are rather out of fashion in this court. The rule in this regard is nowhere better stated than in the case of People v. Helmer, 154 N.Y. 600, 49 N.E. 249.

Myron A. Folsom, for Respondent.

Sec. 7128, Rev. Codes, was enacted in 1907 as a complete statute. It will readily be seen from the title that the legislature contemplated that both the elements of falsity and wrongful intent or tendency are necessary to a definition of a crime under this statute. (Coosaw Mining Co. v. South Carolina, 144 U.S. 563, 12 S.Ct. 689, 36 L.Ed. 537; Church v. United States, 143 U.S. 457, 12 S.Ct. 511, 36 L.Ed. 226.)

In order to give the statute in question a meaning which the legislature intended, as shown by the title to the act, it will be necessary that the word "or" after the word "exaggerated" shall be read as "and." This is frequently necessary in statutory construction. (Sutherland on Stat. Construction, sec. 252; State v. Hooker, 22 Okla. 712, 98 P. 971; Thomas v. Grand Junction, 13 Colo. App. 80, 56 P. 665; State v. Myers, 146 Ind. 36, 44 N.E. 801; Kitchen v. Southern Ry., 68 S.C. 554, 1 Ann. Cas. 747, 48 S.E. 4; Ayers v. Chicago Title Co., 187 Ill. 42, 58 N.E. 319; James v. United States etc. Co., 133 Ky. 299, 117 S.W. 406; Douglas v. State, 18 Ind.App. 289, 48 N.E. 9.) An indictment which fails to charge all the necessary elements of a statutory crime is insufficient. (State v. Swenson, 13 Idaho 1, 81 P. 379; State v. Furgerson, 152 Mo. 92, 53 S.W. 427; Moline v. State, 67 Neb. 164, 93 N.W. 228; State v. Eddy, 46 Ore. 625, 81 P. 941; Hase v. State, 74 Neb. 493, 105 N.W. 253; People v. Arnold, 46 Mich. 268, 9 N.W. 406; State v. Ashpole, 127 Iowa 680, 104 N.W. 281.)

The defendant merely attested as director a report which was prepared and sworn to by the cashier. The law did not require him to attest this report. Moreover, an innocent attestation of a report is not the equivalent of the making of a report, neither is a knowledge of the falsity to be imputed to a director. (Yates v. Jones National Bank, 206 U.S. 158, 27 S.Ct. 638, 51 L.Ed. 1002; Potter v. United States, 155 U.S. 438, 15 S.Ct. 144, 39 L.Ed. 214; United States v. Booker, 98 F. 291; United States v. Potter, 56 F. 83, 101.)

SULLIVAN, J. Stewart, C. J., and Ailshie, J., concur.

OPINION

SULLIVAN, J.

This is an appeal on the part of the state from an order sustaining a demurrer and quashing an indictment presented by the grand jury of Shoshone county, to obtain a proper construction of the provisions of sec. 7128, Rev. Codes.

August Paulsen and two others were charged by the grand jury with making a false report concerning the property of the State Bank of Commerce situated at Wallace, Shoshone county, in violation of the provisions of said sec. 7128. The demurrer in effect was based on the ground that the indictment failed to charge either that the false report alleged to have been made was intended to give, or that it had a tendency to give, a greater or less apparent value to the shares, bonds or property of said bank than they in fact possessed. Said section of the statute is as follows:

"Any person who knowingly makes or publishes in any way whatever, or permits to be so made or published, any book, prospectus, notice, report, statement, exhibit or other publication of, or concerning the affairs, financial condition or property of, any corporation, joint stock association, copartnership or individual, which said book, prospectus, notice, report, statement, exhibit or other publication, shall contain any statement which is false or wilfully exaggerated or which is intended to give, or which shall have a tendency to give, a less or greater apparent value to the shares, bonds or property of said corporation, joint stock association, copartnership or individual, or any part of said shares, bonds or property, than said shares, bonds or property or any part thereof, shall really and in fact possess, shall be deemed guilty of a felony, and upon conviction thereof shall be imprisoned for not more than ten years or fined not more than ten thousand dollars, or shall suffer both said fine and imprisonment."

Said section was enacted at the ninth session in 1907 (Sess. Laws 1907, p. 25), and was embodied in the Revised Codes of 1909 as section 7128. Under the provisions of said section, if it were necessary to charge in the indictment that said false report was intended to give, or had a tendency to give, a less or greater apparent value to the shares or bonds or property of said bank than they really possessed, the court did not err in sustaining said demurrer. But if under the provisions of said section it was only necessary to charge that said defendants did knowingly make said false report then the court erred in sustaining said demurrer. The first part of said section provides against a person knowingly making or publishing a false report and closes with the following words: "shall contain any statement which is false or wilfully exaggerated," and then follows this language: "or which is intended to give or shall have a tendency to give a less or greater apparent value to the shares, bonds or property of said corporation," etc. The trial court held under the provisions of said section that it was necessary to charge the intent with which said false report was made or the tendency or the effect of the report in boosting or depressing the stock, etc., and that as it did not do so, it did not charge a public offense. The trial court evidently came to the conclusion that the legislature intended to make one of the essentials of said crime the intent or tendency to mislead as to the apparent value of the corporate shares, bonds or property of such corporation. Counsel for respondent contend that the word "or" between the words "exaggerated" and "which" in said section means "and" and must be read "and," and contend that if so read it would then clearly...