State v. Stevens

• Decision Date: 26 November 1902
• Citation: 92 N.W. 420,16 S.D. 309
• Parties: STATE OF SOUTH DAKOTA, Defendant in error, v. FRED L. STEVENS, Plaintiff in error
• Court: South Dakota Supreme Court

16 S.D. 309

92 N.W. 420

STATE OF SOUTH DAKOTA, Defendant in error,

v.

FRED L. STEVENS, Plaintiff in error South Dakota Supreme Court Error to Circuit Court, Davison County, SD Hon. Frank B. Smith, Judge Reversed H. F. Fellows, W. C. Cook, Aikens & Judge Attorneys for plaintiff in error. A. W. Burtt, Attorney General A. H. Henneous, States Atty., Preston & Hannett, for the state. Opinion filed November 26, 1902

FULLER, J.

Plaintiff in error was sentenced to a penitentiary term of four years and six. months on a verdict of guilty resulting from a trial under an indictment which charges that:

“Fred L. Stevens, late of said county, heretofore, to-wit, on the fourth day of January, A. D. 1900, at the county of Aurora and state of South Dakota, then and there being the cashier of the Bank of Plankinton, a corporation duly organized under the laws of the territory of Dakota, and then and there duly existing as such corporation under the laws of the state of South Dakota, said corporation being then and there engaged in the banking business at the city of Plankinton, in said county and state, and being then and there insolvent, did then and there feloniously and knowingly receive on deposit into and for the Bank of Plankinton as cashier thereof, from and of one Seth Noble, the sum of one hundred and forty-five dollars, in good and lawful money of the United States, the said Fred L. Stevens, as cashier aforesaid, at the time of receiving said deposit well knowing then and there of such insolvency of the Bank of Plankinton, whereby the said deposit of one hundred and forty-five dollars, lawful money of the United States, was lost by the said Seth Noble, to his great damage and injury.”

The statute provides that

“no bank, banking house, exchange broker, or deposit office or firm, company, corporation or party engaged in the banking, broker or deposit business, shall accept or receive on deposit, with or without interest, any moneys, bank bills, or notes, or United States notes, or United States treasury notes, or currency, or other notes, bills or drafts circulating as money or currency, when such bank, banking house, exchange broker, or deposit office, firm, company or corporation or party is insolvent; and if such bank, banking house, exchange broker; or deposit office, firm, company, corporation or party shall receive or accept on deposit any such deposits as aforesaid when insolvent, any officer, director, cashier, manager, member, party or managing party thereof, knowing of such insolvency, who shall knowingly receive or accept, be accessory, or permit or connive at the receiving or accepting on deposit therein or thereby, any such deposit as aforesaid, shall be guilty of a felony and upon conviction shall be punished”

as therein provided. Comp. Laws, § 6850.

When the Bank of Plankinton was organized, there was no statute authorizing such incorporation, and the nonexistence of a de jure corporation stands proved, and is conceded by the prosecution. That there can be no de facto corporation unless the statute authorizes the formation of a de jure corporation is too clear to admit of any dispute, and, consonant with such doctrine this court has held “that there can be de facto] officer without a de jure office.” Thurber v. Miller, 901 (1898). As none of the essential elements of an estoppel in pais are present in this case, we need not determine whether such equitable doctrine of estoppel by conduct should preclude a defendant in a prosecution of this character from speaking the truth. It was clearly shown by the undisputed testimony that the Bank of Plankinton was holding itself out to the public and doing business as a corporation at the time charged in the indictment, and that banking corporations were then recognized by the statute expressly providing for their creation is a matter that must be judicially noticed. Articles of incorporation, formulated at the inception of the business, were filed with the territorial secretary on the 27th day of November, 1885; and continuously since that date the managing officers, apparently in good faith, have transacted a banking business thereunder in the corporate name of the Bank of Plankinton. Such exercise of corporate functions pursuant to a bona fide attempt to organize, and the existence of a statute under which a banking corporation, with all the powers assumed might have been lawfully created at the time alleged in the indictment, is sufficient to constitute a de facto corporation, and meet the requirements of this prosecution against its chief executive officer. People v. Hughes, 29 Cal. 258; People v. Schwartz, 32 Cal. 160; Maxw. Cr. Proc. p. 67. Speaking for the court in US v. Amedy, 11 Wheat. 302, 6 LEd 502, Mr. Justice Story said:

“This is not the case where a suit is brought by the corporation to enforce its rights, where, if the fact of its legal existence is put in controversy upon the issue, the corporation may be called upon to establish its existence. The case of Dutch West India Co. v. Van Moyses, cited in 2 Ld. Raym. 1535, as decided be fore Lord King, whatever may be its authority, was of that sort, and therefore carries with it an obvious distinction; nor is this the case of a quo warranto, where the government calls upon the company to establish its legal corporate powers and organization.”

The case here is of a public prosecution for a crime, where the corporation is no party, and is merely collaterally introduced as being intended to be prejudiced by the commission of the crime. Under such circumstances, we think, nothing more was necessary for the government to prove than that the company was de facto organized, and acting as an insurance company and corporation.

In his official capacity the accused made sworn statements to the public examiner, during the year 1899, purporting to show the financial condition of the Bank of Plankinton on March 11th, June 30th, and October 3d of that year, and these statements were admitted in evidence over the following objection:

“Defendant objects because they are irrelevant, and specifically at this time, as grounds for objection, that the undisputed evidence in this case shows that there is a material variance between the indictment and the facts proven regarding the deposit of money and the alleged incorporation of the Bank of Plankinton; that it appears by proof offered by the state that the Bank of Plankinton is not a duly organized corporation, created and existing as alleged in the indictment, but that it appears that the pretended incorporators of the Bank of Plankinton, failing to incorporate, became partners, and, as partners, were jointly and severally liable for the debts of the concern; that upon a verdict of either acquittal or conviction in this case the defendant could not plead in bar, and show by the record, without extraneous evidence, that the charge contained in this indictment was the same as one that might be made against him for receiving the the same deposit while acting for the partnership which we claim the law established as proven by the evidence in this case. For that reason the variance between the proof and the indictment is material, and no evidence is relevant or admissible, tending further to prove the condition of the pretended corporation. And for the further reason that the evidence conclusively shows the failure of proof by the...