U.S. v. Johnson
| Decision Date | 23 April 1984 |
| Docket Number | No. 82-3205,82-3205 |
| Citation | 730 F.2d 683 |
| Parties | 15 Fed. R. Evid. Serv. 1115 UNITED STATES of America, Plaintiff-Appellee, v. Robert Allen JOHNSON, Roy Maxwell Lister and Ira Hill, Jr., Defendants- Appellants. |
| Court | U.S. Court of Appeals — Eleventh Circuit |
Robert J. Vossler, Tallahassee, Fla., for Johnson.
John D. O'Brien, Panama City, Fla., for Hill.
Paul G. Komarek, Panama City, Fla., for Lister.
David L. McGee, Pensacola, Fla., for United States.
Appeals from the United States District Court for the Northern District of Florida.
Before GODBOLD, Chief Judge, RONEY and KRAVITCH, Circuit Judges.
The appellants, Ira Hill, Jr., Roy Lister and Robert Johnson, were indicted on one count of conspiracy to submit false statements to a federal agency and eleven counts of submitting false statements and documents to federal agencies in violation of 18 U.S.C. Sec. 1001. A jury found all three appellants guilty of conspiracy. Additionally, Hill was convicted of eight of the eleven counts of submitting false statements and documents, Johnson of five, and Lister of four.
The convictions arose out of Hill's attempt to sell various businesses by financing the sales through loans guaranteed by the Small Business Administration (SBA) and the Farmers Home Administration (FHA), both of which are federal agencies. The loan applications were first submitted to the Wewahitchka State Bank, where they were reviewed and recommended to the federal agencies by defendant Lister, then president of the bank and officer in charge of the loans. Defendant Johnson was the prospective purchaser of one of the businesses, Florida Trailer Sales (FTS), and Pamela Wells, the woman he lived with, was the prospective buyer of another business, Eastgate Mobile Home Park. Hill also attempted to obtain a loan guarantee from the SBA for the sale of the Big Chief Truck Stop to another individual, Joe Dasinger.
The government contended at trial that the documents submitted to the SBA and FHA contained a number of false statements. These statements formed the basis for the various counts in the indictment:
(1) In the personal history form for Johnson submitted to the SBA to guarantee the purchase of FTS, it was represented that Johnson had never been arrested for, charged with, or convicted of a criminal offense. Johnson had in fact been convicted of two prior felonies. All three defendants were convicted of this count (Count II) 1.
(2) A representation to the SBA that a $50,000.00 deposit had been paid by Johnson towards the purchase of FTS, which the government contended had not actually been made (Count III). All three defendants were acquitted by the jury on this charge.
(3) A representation in the personal financial statement to the SBA that Johnson had assets exceeding his liabilities of $83,000.00 (Count IV). The jury found only Johnson guilty of this charge.
(4) A representation to the SBA that Johnson had made an additional $10,000.00 down payment toward the purchase of FTS, which the government contended had not been made (Count V). Johnson and Hill were found guilty; Lister's motion for a directed verdict was granted.
(5) A statement in Hill's personal history form for the purchase of FTS that he had never been arrested for, charged with, or convicted of a criminal offense, when he had in fact been previously convicted of two counts of tax evasion (Count VI). Hill and Lister were found guilty on this count; Johnson's motion for a directed verdict was granted.
(6) A letter from Lister to the SBA stating that Hill intended to purchase FTS from his father, when allegedly Hill already owned the business (Count VII). Lister and Hill were found guilty on this count; Johnson's motion for a directed verdict was granted.
(7) A representation to the SBA in Hill's financial statement for the purchase of FTS that Hill's net worth was $163,000.00, which the government alleged was untrue (Count VIII). Hill and Lister were found guilty; Johnson's motion for a directed verdict was granted.
(8) A representation to the FHA in a loan application for the purchase of Eastgate Mobile Home Park that Hill's net worth was 3.3 million dollars, which the government alleged was untrue (Count IX). Hill was found guilty and Lister was acquitted; Johnson's motion for a directed verdict was granted.
(9) A representation to the FHA that Pamela Wells had made a $5,000.00 down payment towards the purchase of Eastgate, and would make an additional down payment of $35,000.00 at closing, which representations the government alleged were untrue (Count X). Hill and Johnson were found guilty and Lister was acquitted.
(10) A statement to the FHA that Wells' assets exceeded her liabilities by $126,800.00, which the government alleged was untrue (Count XI). Johnson was found guilty and Hill was acquitted; Lister's motion for a directed verdict was granted.
(11) A representation to the SBA that Joe Dasinger had made a $10,000.00 down payment toward the purchase of the Big Chief Truck Stop, which the government contended was untrue (Count XII). Hill was found guilty; Johnson and Lister's motions for directed verdicts were granted.
The government attempted to prove the allegations mainly through the testimony of Nick Mason, Hill's Certified Public Accountant. Mason testified at length how he, Hill and Johnson had knowingly falsified information in an attempt to secure the loan guarantees for the various sales. Mason also testified about two transactions, unrelated to the charges, in which Hill, Lister and Johnson allegedly had engaged in similar fraudulent schemes.
The government called several other witnesses. FBI Special Agent Gene Halley related how Johnson had confessed that he, Hill, Mason and Lister had embarked upon a scheme to fraudulently obtain government loan guarantees. Pamela Wells, the prospective purchaser of the Eastgate Mobile Home Park, testified that the financial information she had provided was false and that the falsified information was submitted with the knowledge of Hill and Mason.
All three defendants took the stand. Both Johnson and Hill readily admitted that they had prior convictions, but contended that they had relied on Mason to fill out the SBA and FHA applications and were unaware that Mason had falsified the applications in this respect. They also testified that their statements of financial worth and the disputed down payments were basically accurate and that any false statements were made without their knowledge. Lister's main defense was that he had failed to review the applications and thus was unaware of the false statements in the applications. He also denied knowledge of the allegedly non-existent down payments.
The appellants first contend that the trial court erred in denying their request for an instruction on the defense of good faith reliance on an expert. They argue that they were entitled to such an instruction because their main defense at trial was that they had relied on their CPA, Nick Mason, as an expert in filling out SBA and FHA applications for loan guarantees. The trial court refused to give the instruction because it found that the defense was inapplicable to the facts of the case. We agree.
The defense of good faith reliance on expert advice is "designed to refute the government's proof that the defendant intended to commit the offense." United States v. Miller, 658 F.2d 235, 237 (4th Cir.1981). To succeed, the defendant must show that (1) he fully disclosed all relevant facts to the expert and (2) that he relied in good faith on the expert's advice. United States v. Smith, 523 F.2d 771 (5th Cir.1975), cert. denied, 429 U.S. 817, 97 S.Ct. 59, 50 L.Ed.2d 76 (1976). 2
The flaw in the defendants' argument is that no expert advice was given to the defendants on which they relied. The charges against Hill, Johnson and Lister are not of the type where reliance on expert advice is relevant:
(1) Hill and Johnson do not contend that Mason advised them to lie about their past criminal records, 3 but simply that they were unaware that the false statements were included in the applications.
(2) The appellants also do not argue that they relied on Mason in calculating either theirs or Pamela Wells' financial assets, but instead claim that the statements were in fact substantially accurate and they did not know of any inaccuracies.
(3) Likewise, they do not claim that Mason advised them to falsely claim that down payments had been made, but rather that the down payments had either been made or that they did not knowingly claim that nonexistent down payments had been made.
(4) Finally, although Hill testified at trial that Mason advised him to transfer the stock of I & E Corporation to his father, the issue at trial was not whether such a transaction was legal (to which the defense would arguably apply), but whether the transfer of stock ever took place, which reliance on expert advice was not relevant.
The appellants' defenses at trial, therefore, are properly characterized as claims that they did not willfully and knowingly make false statements, 4 and not as contentions that they relied on expert advice in making such statements.
The district court was not required to "grant a request that [did] not concern issues properly before the jury ...." United States v. Goss, 650 F.2d 1336, 1344 (5th Cir. Unit A 1981). The court did not err, therefore, in denying the appellants' request for an instruction on the expert advice defense.
During Mason's testimony, Hill stated in a loud voice, "He is lying." The court dismissed the jury and informed defense counsel that he intended to give a curative instruction to the effect,
Any comments you may have heard in the courtroom from people not under oath should be disregarded by you and play no part in your decision.
Defense counsel made no objection to the...
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