United States v. D'anna, 94

• Citation: 450 F.2d 1201
• Decision Date: 27 October 1971
• Docket Number: No. 94,Docket 71-1420.,94
• Parties: UNITED STATES of America, Appellee, v. John A. D'ANNA and Rita D'Anna, Defendants-Appellants.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

450 F.2d 1201 (1971)

UNITED STATES of America, Appellee, v. John A. D'ANNA and Rita D'Anna, Defendants-Appellants.

No. 94, Docket 71-1420.

United States Court of Appeals, Second Circuit.

Argued September 13, 1971.

Decided October 27, 1971.

Michael I. Saltzman, Asst. U. S. Atty., New York City (Whitney North Seymour, Jr., U. S. Atty., for the Southern District of New York, New York City, and Ross Sandler, Asst. U. S. Atty., New York City, of counsel), for appellee.

Milton S. Gould, New York City (Shea, Gould, Climenko & Kramer, New York City, and Michael Lesch, New York City, of counsel), for appellants.

Before MOORE, SMITH and HAYS, Circuit Judges.

MOORE, Circuit Judge:

Defendants, John D'Anna and Rita D'Anna, appeal from judgments of conviction entered after a four day jury trial. Appellants were found guilty of wilfully attempting to evade their Federal income taxes for the years 1963 and 1964 under Counts One and Three of the indictment, 26 U.S.C. § 7201,¹ and of making and subscribing joint Federal income tax returns for the same years knowing them to be materially false under Counts Two and Four of the indictment, 26 U.S.C. § 7206(1).² John D'Anna was sentenced to 60 days on each Count to be served concurrently and was fined $500 on each Count for a total fine of $2,000. Rita D'Anna was similarly sentenced to 60 days on each Count to run concurrently. Execution of her sentence was suspended and she was placed on probation for one year.

The appellants contend that there are four reasons for reversing their convictions. First, they claim that there was a prejudicial variance between the indictment and the proof on Counts Two and Four. Secondly, it is asserted that the District Court erred in excluding certain testimony. Thirdly, appellants point to allegedly improper remarks of the prosecutor in his summation and contend that these worked to deprive them of a fair trial. Lastly, appellants claim that the Trial Judge's frequent interjections and questions created an atmosphere which made a fair trial impossible. For the reasons stated below, this Court finds that no reversible error was committed.

The Facts

The appellant, John D'Anna, is a surgeon with a substantial practice. His office was located at his home. His wife, Rita D'Anna, worked as his secretary, bookkeeper and assistant during the years in question. By 1962 the D'Annas had had seven children. Thus, superimposed upon her work for the doctor, she had the responsibility of maintaining the household. They do not dispute the fact that their joint tax returns for the years 1963 and 1964 materially understated their actual gross income.³ Their sole defense is that the errors in the returns were not "wilfull."

In support of their defense theory, the appellants were able to introduce evidence of a chain of events which allegedly caused them to be negligent in filling out their returns. The first of these events was the accidental drowning of their two year old daughter in July, 1962. Apparently Mrs. D'Anna felt that she was in part responsible for this death and was despondent over it. In January 1963 Mrs. D'Anna's mother and her father, who suffered from heart disease and was terminally ill with cancer, moved into the D'Anna home. In January 1964 Mrs. D'Anna's father died. Other evidence which the jury had a chance to evaluate pointed to the fact that Mrs. D'Anna was physically ill during the years in question. Additional evidence indicated that Dr. D'Anna was working long hours under adverse family conditions.

According to the appellants, Mrs. D'Anna kept the financial records upon which the returns were based. After she prepared the information to be used, Dr. D'Anna would read these figures to their attorney who would then complete the returns.

The Government's case consisted, primarily, in showing that the D'Annas' gross receipts exceeded their reported gross receipts. It was shown, for instance, that the bank statements upon which the appellants claimed that their returns were based did not reflect a number of third party checks cashed by the appellants. Additional evidence indicated that Dr. D'Anna was neither completely accurate nor completely consistent in his statements to an Internal Revenue Agent who was investigating his returns.

The Indictment

The indictment was filed on March 23, 1970. Counts Two and Four of the indictment charged the appellants with stating in their income tax returns their gross receipts for the years 1963 and 1964 to be $38,332.82 and $32,712.77 respectively, though they knew their gross receipts to be greater.

On August 28, 1970, the Government filed a bill of particulars which indicated that the appellants had in fact stated in their income tax returns their gross receipts to be $57,142.50 and $55,959.51 for the years 1963 and 1964 respectively. The figures given in the bill of particulars were the correct amounts stated by the appellants. At trial the Government proved that the D'Annas' actual gross receipts were $73,344.95 and $77,084.77 for the years 1963 and 1964 respectively. Thus, the effect of the error in the indictment was to overstate the unreported gross receipts for each year and this resulted in a corresponding overstatement of unpaid taxes due.

At the conclusion of the Government's case, the appellants moved for a judgment acquitting them of the charges contained in Counts Two and Four of the indictment. The motion was denied. Rather than acquitting the appellants, the District Court, relying on United States v. Feldman, 299 F.2d 914 (2d Cir.), cert. denied, 370 U.S. 910, 82 S.Ct. 1256, 8 L.Ed.2d 403 (1962), instructed the jury to disregard the errors and to consider the indictment as if the figures had been correctly stated. This, the appellants contend, violated their Fifth Amendment right to an indictment by a Grand Jury.

The two primary functions of an indictment are to inform an accused of the charges against him so that he may prepare his defense and to avoid double jeopardy. Berger v. United States, 295 U.S. 78, 82, 55 S.Ct. 629, 79 L.Ed. 1314 (1935). Whether a variance between the indictment and the proof is fatal to the prosecution will depend on determining whether these "substantial rights" of the accused have been adversely affected. Berger, supra, at 82, 55 S.Ct. 629; Stirone v. United States, 361 U.S. 212, 217, 80 S.Ct. 270, 4 L.Ed. 2d 252 (1960).

In United States v. Feldman, supra, this Court held that an indictment which charged extortion of $45,000 while the proof showed the correct figure to be $65,000 was not fatally defective. Therein, as here, the bill of particulars fairly apprised the accused of the charges against him and indicated the evidence that would be introduced to support the charges against him. There was no possibility of double jeopardy. These principles control the issue here.

The bill of particulars in the instant case clearly indicated the proof that the Government would rely upon in the prosecution. There is no question of double jeopardy. No "substantial rights" have been affected by the variance. The District Court's ruling was correct.

The Excluded Testimony

The appellants' defense was that the understatements in their joint tax returns were not "wilfull." United States v. Baird, 414 F.2d 700, 702 (2d Cir. 1969), cert. denied, 396 U.S. 1005, 90 S.Ct. 559, 24 L.Ed.2d 497 (1970); United States v. Driscoll, 399 F.2d 135, 136 (2d Cir. 1968). To show that their conduct was inadvertent, defense counsel sought to introduce evidence concerning the appellants' states of mind. As noted, counsel was successful in placing most of this evidence before the jury. The portions of the testimony excluded by the Trial Judge are the basis of the appellants' second contention.

The excluded testimony was to be elicited from two of the defense witnesses, Dr. Milton M. Edelman and Dr. Vincent M. Sottile, neither of whom was, or was called as, an expert in the field of psychiatry.⁴ Both had virtually daily communication with Mrs. D'Anna during the period in question though not treating her in their medical capacities. They were permitted to testify as to their observations of Mrs. D'Anna and to their conclusions about her state of mind. They were not permitted to testify to anything that she had told them about herself during the period in question. The Court ruled that this would be hearsay. Appellants contend that in this respect such statements by her should have been admissible as "verbal acts."

In claiming that Mrs. D'Anna's statements were "verbal acts" not subject to the hearsay rule, the appellants rely on United States v. Baird, supra. Therein this Court held that an alienist could testify to statements made to him by a defendant during an examination. These self-serving statements were ruled admissible on the theory that they were "real evidence" upon which the alienist had based his diagnosis. United States v. Baird, supra, 414 F.2d at 709. This situation in Baird was quite different from that presented here. In the instant case, the defense witnesses, though doctors, were testifying about their observations as ordinary witnesses. There was no expert diagnosis for the jury to evaluate. To find the appellant's statements to these witnesses admissible under the "verbal acts" doctrine would create an unwarranted extension of the doctrine.

Baird, so much relied upon by the appellants, actually supports the position of the Trial Court and the Government. In Baird two defenses were interposed (1) that defendant's failure to file was not "wilful" and (2) that defendant lacked the capacity to appreciate the wrongfulness of his act because of "a mental disease or defect." The latter defense called for testimony from psychiatric experts. One of the psychiatrists for the defense was permitted to testify to numerous out-of-court statements by Baird during his examination by the psychiatrist. This Court held that, although these self-serving hearsay...