U.S. v. Rimell

• Decision Date: 26 May 1994
• Docket Number: 93-1036,Nos. 92-3867,s. 92-3867
• Citation: 21 F.3d 281
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Harriet RIMELL, Defendant-Appellant. UNITED STATES of America, Plaintiff-Appellee, v. Albert RIMELL, Defendant-Appellant.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 281

21 F.3d 281

UNITED STATES of America, Plaintiff-Appellee, v. Harriet RIMELL, Defendant-Appellant.

UNITED STATES of America, Plaintiff-Appellee, v. Albert RIMELL, Defendant-Appellant.

Nos. 92-3867, 93-1036.

United States Court of Appeals,

Eighth Circuit.

Submitted Nov. 8, 1993.

Decided April 12, 1994.

Rehearing and Suggestion for Rehearing En Banc Denied May

26, 1994 in No. 93-1036.

Richard J. Burke, Jr. (argued), St. Louis, MO, for appellant Harriet Rimell.

Robert B. Ramsey (argued), St. Louis, MO, for appellant Albert Rimell.

Audrey G. Fleissig and Rosemary Casey Meyers, Asst. U.S. Attys. (argued), St. Louis, MO, for appellee.

Before HANSEN, Circuit Judge, JOHN R. GIBSON ^*, Senior Circuit Judge, and MELLOY ^**, District Judge.

JOHN R. GIBSON, Senior Circuit Judge.

Albert Rimell appeals his convictions on eleven counts of bank fraud, 18 U.S.C. Secs. 1344 and 2, six counts of making false entries in bank records, 18 U.S.C. Secs. 1005 and 2, one count of fraudulently transferring or concealing property in contemplation of bankruptcy, 18 U.S.C. Sec. 152, and three counts of fraudulently concealing the proceeds of a sale in contemplation of bankruptcy, 18 U.S.C. Secs. 152 and 2. Albert Rimell's wife, Harriet Rimell, appeals her convictions on one count of fraudulently transferring or concealing property in contemplation of bankruptcy, 18 U.S.C. Sec. 152, two counts of fraudulently concealing proceeds of a sale in a bankruptcy matter, 18 U.S.C. Secs. 152 and 2, and two counts of making false oath and account in a bankruptcy matter in violation of 18 U.S.C. Sec. 152. Albert Rimell argues that his convictions should be reversed because he was represented during some of his trial by an unlicensed attorney, and because the separate counts of his indictment are multiplicitous. He also contends that the district court ¹ erred in sentencing. Harriet Rimell argues that her convictions should be reversed because the district court erred in refusing to grant severance. We affirm Albert and Harriet Rimell's convictions.

The convictions in this case stem from a simple bank fraud scheme. Albert Rimell, a real estate broker in St. Louis, Missouri, along with his employees, Lawrence Margulis, John Treacy, and Gregory Chapman, ² fraudulently obtained loans to buy rental properties. Rimell would ask a person he knew to buy rental property. By using "straw parties" (or partnerships in which he had an interest) he would then buy the property for a higher price, obtain a loan based on the higher price, and disburse the excess loan proceeds to himself and his employees. In order to obtain the loans, Rimell filed false loan applications and provided the banks with inflated rental schedules for the properties. Evidence at trial showed that Rimell used this scheme in connection with purchasing five properties.

Rimell's scheme began to unravel in 1988 when the various partnerships which owned the rental properties defaulted on their loan payments. Mercantile Bank, which had loaned money on three of Rimell's properties, initiated foreclosure proceedings. To avoid foreclosure, the partnerships indebted to Mercantile filed for voluntary bankruptcy. After Mercantile and the partnerships agreed to a workout schedule, Mercantile examined the records of the properties, and discovered the rental income was insufficient to service the debt.

In December 1988, the Rimells met with at least two attorneys to discuss "estate planning." The Rimells created the Rimell Family Trust in January 1989, transferring their home and several partnership interests into the revocable trust. The trust, which the Rimells could change at any time, contained a clause directing the trustee "not to pay any debt, obligation or liability to Mercantile Bank." The Rimells opened bank accounts in the trust's name and began to deposit paychecks and pay household expenses out of the trust accounts. In May 1989, the Rimells executed another trust document and deed by which they purported to transfer their home to a second Rimell Family Trust. This trust named their son, Samuel, as trustee.

By the fall of 1989, it was evident that the various partnerships could not achieve the plans of reorganization. On October 18, 1989, Mercantile Bank, Mark Twain Bank, and Boatmen's Bank filed petitions for involuntary bankruptcy against the Rimells. After the Rimells contested the bankruptcy, the bankruptcy court held a trial beginning in late December 1989. Regarding the April 1989 refinancing of the home, owned by Harriet and Albert Rimell, Harriet Rimell testified that after paying off the first mortgage and for some remodeling, the Rimells paid about $65,000 of the proceeds in cash to their children. The evidence at trial showed, however, that the Rimell children did not receive any of the refinancing proceeds. The bankruptcy judge adjudged the Rimells bankrupt and appointed a trustee to administer the bankruptcy estate.

On April 2, 1990, as part of the bankruptcy proceedings, the bankruptcy court required the Rimells to file Statements of Financial Affairs. The Statements required the Rimells to disclose all transfers of assets within one year of the filing of the bankruptcy petition. The Rimells did not disclose that they had transferred their home to a trust. At the first meeting of creditors, Harriet Rimell admitted that she had lied in bankruptcy court about what had happened to the refinancing proceeds. At these meetings, the creditors told the Rimells that they intended to dissolve the trust and sell the house for the benefit of creditors. The creditors also advised Harriet Rimell that her personal property constituted property of the estate, and that under bankruptcy court rules, she would only be allowed to retain a limited amount of that property.

On July 13, 1990, the bankruptcy trustee filed suit against the Rimells to set aside the trust, notified the Rimells' attorney of the action, and had copies served on the Rimells. Without notifying their attorney or the trustee, the Rimells sold their house for $165,000 on July 23. The proceeds of the sale, approximately $49,000, were issued in a cashier's check payable to the Rimells' son, Samuel, and then deposited in three separate bank accounts. One account was in Samuel Rimell's name, one account in the name of Harriet Rimell's mother, and a third account in the name of Samuel Rimell, d/b/a Mechanical Delivery Systems.

The first weekend in August the Rimells also held an estate sale at their home. When the bankruptcy trustee learned about the sale, he filed a motion for an emergency hearing with the bankruptcy court. The court held a hearing on August 8, and Harriet and Albert Rimell testified that the property sold at the sale belonged to their son. There was evidence, however, that the Rimells actually sold the contents of their own home.

Following a three-week trial, Harriet and Albert Rimell were convicted on all counts. Both appeal.

I.

Albert Rimell contends that this court must reverse his convictions because he was denied his Sixth Amendment right to counsel. Rimell asserts that he was denied effective assistance of counsel because Daniel Dalton, not yet admitted to the Missouri Bar, cross-examined several witnesses. At the time of Rimell's trial, Dalton had recently graduated from law school, had taken the bar exam, and was awaiting his results. Rimell makes no argument that Dalton's examination was in any way inadequate, but he argues that Dalton's representation was a per se violation of his Sixth Amendment right to counsel.

Bradford Kessler, a licensed attorney retained by Rimell, introduced Dalton to the jury during voir dire examination and Dalton assisted at the trial. During the trial, Dalton, with Kessler present at the counsel table, cross-examined five witnesses, objected during the direct examination of some of the five witnesses, and announced that there would be no cross-examination of two other witnesses.

Dalton's first statement in the presence of the jury and court occurred during the fourth day of trial. After the government's examination of V.J. Thomas, Dalton announced that he had no questions for the witness. During the government's examination of Thomas, Kessler made three objections, all of which occurred in the latter part of the examination. Dalton made a similar statement with respect to witness David Rich. Dalton cross-examined Milton Goldenberg and Albert Mollman, who together with Rich, had sold properties to Rimell's associates. These witnesses testified about the transactions, the documents executed, and the prices paid for the properties. Dalton also cross-examined Terry Hammer, John Moore, and David Budding, who were straw parties who signed documents at Rimell's request.

Before Dalton cross-examined his first witness, John Moore, Kessler requested to approach the bench, and the court held a bench conference. The bench conference was not transcribed. The district court order denying Rimell's Rule 60(b) motion, however, recites that during the bench conference Kessler requested that the court allow a non-attorney to participate in the trial. United States v. Rimell, No. 4:92 CR 12 SNL, slip op. at 2 (E.D.Mo. Jan. 25, 1993). The order states that Kessler made this request out of the hearing of the jury, in open court, and in the presence of the defendant. Id. The judge further stated that he understood that the non-attorney had graduated from an accredited law school, had taken the bar examination and was awaiting the decision, and had been assisting defendant's counsel "in this and other matters." Id. The government argues that these facts were developed during the bench conference out of the hearing of the jury, but we have no way of knowing whether this occurred. Rimell, however, has not contested the district court's recitals in its order.

After Rimell's convictions, he filed a Petition for Writ of Error Coram Nobis, arguing that he was denied effective...