U.S. v. Walls

• Decision Date: 28 June 1978
• Docket Number: No. 77-2089,77-2089
• Citation: 577 F.2d 690
• Parties: 3 Fed. R. Evid. Serv. 621 UNITED STATES of America, Plaintiff-Appellee, v. Kenneth Wayne WALLS, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 690

577 F.2d 690

3 Fed. R. Evid. Serv. 621

UNITED STATES of America, Plaintiff-Appellee, v. Kenneth Wayne WALLS, Defendant-Appellant.

No. 77-2089.

United States Court of Appeals Ninth Circuit.

June 28, 1978.

Morris Lavine, Los Angeles, Cal., for defendant-appellant.

Michael D. Hawkins, U.S. Atty., Phoenix, Ariz., for plaintiff-appellee.

Appeal from the United States District Court for the District of Arizona.

Before BARNES and CHOY, Circuit Judges, and LYDICK, ^* District Judge.

BARNES, Senior Circuit Judge:

The appellant, Kenneth W. Walls, was convicted by a jury in the District Court of Arizona on two counts. The first count charged the appellant with devising a scheme or artifice to defraud Violet Bjerke, by causing a quitclaim deed executed by him to be sent through the United States Postal Service on or about January 24, 1972 from Calaveras County, California, to Arizona, in violation of 18 U.S.C. §§ 1341 ¹ and 2. ² The second count charged appellant with transporting from Alaska and Arizona $10,000 in interstate commerce on or about December 20, 1971, in violation of 18 U.S.C. §§ 2314 ³ and 2. Appellant was sentenced to five years in prison and a $5,000 fine We have jurisdiction. 28 U.S.C. §§ 1291 and 1294(1). The district court had original jurisdiction. 18 U.S.C. § 3231.

with the further order that "defendant stay committed until said fine be paid." (CT 156).

Appellant raises twenty-one issues on appeal. We reduce them to the six suggested by the government and conclude that none of appellant's contentions warrant reversal.

I. FACTS

We adopt a modified and enlarged form of the government's statement of facts, which is more precise and accurate than that offered by appellant. ⁴

Appellant allegedly made false representations to obtain $20,000 from Mrs. Violet Bjerke. The misrepresentations concerned his claimed ownership and the mineral productivity of property in California which induced Mrs. Bjerke to loan appellant $20,000 on a short-term basis. The loan was never repaid. Federal jurisdiction was obtained when the quitclaim deed was filed in California and returned to Arizona by use of the mails, and when appellant cashed Mrs. Bjerke's Alaska State Bank check in Arizona.

In December of 1971, appellant approached Violet Bjerke in Scottsdale, Arizona, about investing in a gravel pit and gold mining operation appellant claimed to have underway in Calaveras County, California. (RT 45-46). Appellant had tried unsuccessfully to interest Mrs. Bjerke in his investments on several prior occasions. (RT 45).

Appellant claimed to be getting gold out of the gravel pit and showed Mrs. Bjerke nuggets he claimed were taken from the operation. (RT 57). Mrs. Bjerke agreed to invest $20,000 in appellant's venture. In return, appellant executed on December 20, 1971 a promissory note, promising to pay her $25,000 "no later than January 2, 1972." As purported security, appellant gave Mrs. Bjerke a quitclaim deed to the mineral rights in the gravel pit/gold mine. (RT 49-52).

Relying on appellant's statements, the promissory note and the security therefor, Mrs. Bjerke gave appellant two checks on December 20, 1971, one drawn on her Alaska bank account in the amount of $10,000 (RT 58; Gov. Exh. 3), and another $10,000 check drawn on an Arizona bank. (RT 59; Gov. Exh. 4).

The local check was cashed the same day; the Alaska check was endorsed and presented to the local bank the same day (apparently to be applied on Loan No. 42-11135), and was paid by the Alaska bank on December 27, 1971. By cashing the $10,000 check drawn on the Alaska State Bank, appellant caused the Alaska State Bank to withdraw $10,000 from Mrs. Bjerke's account. The Arizona Bank in Phoenix received the $10,000 from the Alaska State Bank through the Federal Reserve System. (RT 121-123).

Appellant represented to Mrs. Bjerke that he would use the money to develop the gold mine in Calaveras County. Mrs. Bjerke never received any money in return. Appellant left the Phoenix area in February, 1972. (RT 60).

After making the loan, Mrs. Bjerke became concerned over her investment with the appellant and ultimately had the quitclaim deed mailed to Calaveras County, California, for recording, but not until January 24, 1972. She received the deed back from the county recorder's office in the mail. (RT 52-53). Recorded instruments are mailed out by the county recorder in the ordinary course of business. (RT 80-81).

The parcel in question is between three and five acres and is part of a larger forty-acre parcel which apparently had a fair market value ranging from $18,760 (as of May, 1970) to $30,030 (as of November, 1973). (RT 104, 105). The Calaveras County Assessor has no information that the parcel in question has ever produced commercial quantities of gold. (RT 106).

No record of appellant's ownership of Lot 4, Block 1, Douglas Flat Townsite (the mineral rights of which appellant gave Mrs. Bjerke as security) exists in the official records of Calaveras County. (RT 90). At the time of appellant's representations to Mrs. Bjerke (December, 1971), record title was in the name of one Moheng. (RT 91). Title to the parcel after January 2, 1972 was in the name of Harley R. Walls and Margaret Petts Walls (appellant's parents), pursuant to a grant deed dated December 13, 1971 but not recorded until January 7, 1972. (RT 90). When the appellant gave Mrs. Bjerke the quitclaim deed, he had nothing to give. (RT 91, 95).

In sum, when appellant Kenneth W. Walls took the $20,000 in checks from Mrs. Bjerke on December 20, 1971, and issued his note to her for $25,000 payable in January 2, 1972, he had no title to the land, or the mineral rights which he purported to assign. Furthermore, we note that, on December 20, 1971, only Item 1 of the various deeds (see note 4, supra ) was recorded in Calaveras County, where the property was located.

At trial, the defense called Ted Purinton, who testified that he loaned appellant $20,000 in January, 1972, and was present, within sight, when appellant paid Mrs. Bjerke an unknown amount of money by counting the cash out to her on the hood of his car at 5:00 p. m. on the side of a road in Scottsdale, Arizona. (RT 168-169). This scenario was flatly denied by Mrs. Bjerke. (RT 258). Purinton stated that appellant Appellant's father, Harley Walls, testified for the defense that he purchased the property in Douglas Flat for $134,000 on September 1, 1971 from the previous owners. (RT 226). Walls further testified that he paid $3,000 down, the balance to be paid pursuant to an agreement of sale. (RT 227). Apparently, this 4.2 acre parcel contained a rock crusher plant and equipment. (RT 231).

had told him he needed the $20,000 to buy a rock plant. (RT 171).

For some reason, however, Harley Walls did not obtain the deed to this property until a subsequent transaction occurred between Walls and the previous owners in December, 1971. (RT 243). Walls testified that, at this latter transaction, he paid $40,000 for the forty-acre parcel of which Lot 4, Block 1, is a subparcel. (RT 242). He had two liens on the property. (RT 242). In his testimony, Harley Walls claimed to have worked the gravel pit on the forty-acre parcel prior to having it deeded to him on December 13, 1971. (RT 244). He also stated that the entire venture was abandoned in the latter part of 1972. (RT 244-245).

Harley Walls further testified that on September 23, 1971, he gave his son (the appellant) a general power of attorney and a quitclaim deed to the mineral rights to the property purchased from the Mohengs. (RT 232-233, 235, 238). However, no such quitclaim deed was produced (RT 237), and Harley Walls admitted that he never recorded either the quitclaim deed or the power of attorney. (RT 239). The power of attorney in evidence was neither witnessed nor acknowledged (Def. Exh. A), and of course, never recorded.

II. ISSUES ⁵

A. Was use of the mails and cashing of the Alaska check sufficient to bring appellant's transactions within either or both of the statutes charged in the indictment?

B. Was there sufficient evidence for the trier of fact to find appellant guilty?

C. Is an indictment signed only by an Assistant United States Attorney sufficient under Fed.R.Crim.P. 7?

D. Did the district court err in admitting evidence of other similar loan transactions by the appellant and failing to instruct the jury on the limited use to be made of such evidence?

E. Was it error for the district court to meet with a juror in chambers, in the presence of both counsel and with their consent, but in the absence of appellant? If so, was the error harmless?

F. Did the appellant receive effective assistance of counsel?

A. USE OF THE MAILS

At the outset, appellant makes what is essentially a jurisdictional argument that use of the mails was insufficient in this case to give federal authorities jurisdiction to prosecute. As to Count I, appellant contends that neither Mrs. Bjerke's mailing the deed to California for recording nor the Calaveras County Recorder's mailing of the recorded quitclaim deed to Mrs. Bjerke (these being the only mailings upon which to base federal jurisdiction in this count) was for the purpose of executing a scheme to defraud as required by 18 U.S.C. § 1341. As to Count II, appellant claims there is no evidence that appellant transported or caused to be transported $10,000 from Alaska to Arizona and that, therefore, the jurisdictional requirement of interstate commerce in 18 U.S.C. § 2314 was not met.

B. SUFFICIENCY OF THE EVIDENCE AS TO COUNT II

Viewing the evidence, as we must, in the light most favorable to the government, Glasser v. United States, 315 U.S. 60, 62 S.Ct. 457, 86 L.Ed. 680 (1942), it is clear that appellant misrepresented the validity

                of the quitclaim deed which Mrs. Bjerke relied on for security when agreeing to loan appellant $20,000, including the $10,000 drawn on the Alaska bank.  6 It is unquestionable that appellant

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