United States v. Haugen, C-3950.

• Decision Date: 22 December 1944
• Docket Number: No. C-3950.,C-3950.
• Citation: 58 F. Supp. 436
• Court: U.S. District Court — District of Washington
• Parties: UNITED STATES v. HAUGEN.

58 F. Supp. 436

UNITED STATES v. HAUGEN.

No. C-3950.

District Court, E. D. Washington, S. D.

December 22, 1944.

Edward M. Connelly, U. S. Atty., and Harvey Erickson, Asst. U. S. Atty., both of Spokane, Wash., for plaintiff.

Ole Sandvig, of Yakima, Wash., for defendant.

SCHWELLENBACH, District Judge.

In an indictment containing three counts, defendant is charged with possessing, publishing and uttering counterfeit meal tickets in violation of Sections 72 and 73, 18 U.S.C.A. In each count of the indictment, it is charged that the meal tickets purported to have been issued by the Olympic Commissary Company, a corporation, which it is alleged was an agency of the United States of America having, as one of its functions, the furnishing and dispensing of meals to workmen employed upon a defense project at Hanford, Washington, under the supervision of the United States Army Engineers Corps. The indictment alleges that the defendant possessed, uttered and published the counterfeit meal tickets with intent to defraud the United States of America. The defendant entered a plea of not guilty, a jury was waived and the Government's testimony was submitted to the Court. The defendant submitted no testimony and the case was taken under advisement.

The plaintiff's testimony proved without doubt that the defendant, who had been an employee at Hanford, Washington, caused to be printed a thousand meal tickets resembling in form those issued by the Olympic Commissary. There is no question but that he published and uttered the meal tickets as alleged in counts 2 and 3 of the indictment and that, when arrested, he had in his possession 966 of such meal tickets as alleged in count 1 of the indictment. The problem in the case arises in determining whether the Government sustained its burden of proving that the Olympic Commissary Company was an agency of the United States and that the defendant possessed and uttered the counterfeit tickets with intent to defraud the United States. During the trial, defendant's counsel objected to the introduction of each portion of the evidence that tended to support these conclusions. Since the case was being tried without a jury, I admitted the evidence, subject to defendant's objection, with the understanding that I would pass on the validity of the objections after submission of arguments and briefs by respective counsel.

The testimony shows that, in February, 1943, the Corps of Army Engineers commenced construction of a tremendous project at Hanford, Washington, known as the Hanford Engineering Project. The property acquired for the project through condemnation proceedings in this Court totaled three hundred seventy thousand acres. The purpose for which the project is being constructed is a military secret of high order. Whether the Olympic Commissary Company is an agency of the United States and whether, by the use of the counterfeit meal tickets, defendant might have perpetrated a fraud upon the United States depends upon the contract under which the Hanford Engineering Project is being constructed and the contract by which Olympic Commissary furnishes meals to the construction employees. The plaintiff called, in support of its contention, R. F. Ebbs, a Major in the United States Corps of Engineers who is executive officer of the Hanford Engineering Works. He testified that the construction work at Hanford was being performed by the E. I du Pont de Nemours Company as prime contractor. His testimony was that that contract was secret by orders of the War Department through the office of Chief of Engineers. So secret is the contract that he was not permitted even to reveal the names of the individuals signing on behalf of the Government and du Pont. He testified that Olympic Commissary Company had a subcontract with du Pont and that this, also, was secret. He stated: "It is considered that the contracts cover a very important construction and operation job, and it would be detrimental to the country to reveal their contents." He testified that the originals of the contracts were in the office of the Comptroller General in Washington, D. C., and that, while he had not seen the contracts, he had seen copies of them. He stated that he was not an attorney but that he had a very competent legal staff at his command. He declined to reveal the length of the contracts. Having laid this foundation for the justification of refusal to submit the contracts to the Court or the defendant, Major Ebbs then proceeded to testify orally concerning those provisions of the contract which were pertinent in this controversy. Plaintiff's case on the question of the relationship between Olympic Commissary and the Government and in support of its position that these counterfeit meal tickets were intended to defraud the Government was based exclusively upon this testimony as to the content of the contracts. The one exception was proof in the form of invoices for food which contained a stipulation that title passed to the United States upon delivery to the Olympic Commissary Company. If this defendant were charged with stealing food belonging to the Government, this invoice evidence would be sufficient. Standing alone, it is no proof that Olympic Commissary was a government agency or that defendant intended to defraud the Government. Unquestionably, Major Ebbs' oral testimony, if admissible, was sufficient to justify a conviction in this case. If such oral evidence was inadmissible, plaintiff has failed to make its case.

The right of the Army to refuse to disclose confidential information, the secrecy of which it deems necessary to national defense, is indisputable. Firth Sterling Steel Co. v. Bethlehem Steel Co., D.C., 199 F. 353; In re Grove, 3 Cir., 180 F. 62. The Army Regulation covering this is quoted in the footnote.¹ The determination of what steps are necessary in time of war for the protection of national security lies exclusively with the military and is not subject to court review. United States v. Kiyoshi Hirabayashi, 320 U.S. 81, 93, 63 S.Ct. 1375, 87 L.Ed. 1774. The war power embraces every phase of the national defense including the protection of war materials and the members of the armed forces from injury and from the dangers which attend the rise, progress and prosecution of war. Prize Cases, 2 Black 635, 671, 17 L.Ed. 459; Miller v. United States, 11 Wall. 268, 303, 20 L.Ed. 135; Stewart v. Kahn, 11 Wall. 493, 506, 20 L.Ed. 176; McKinley v. United States, 249 U.S. 397, 39 S.Ct. 324, 63 L.Ed. 668.

Implicit in a correct answer to the question as to the admissibility of this oral, secondary evidence is the understanding that the best evidence rule is a preferential rather than an exclusionary one. The rule requiring the production of documents is not a rule requiring evidence but a rule preferring the thing itself to any evidence about the thing. As Chief Justice Marshall said, in Tayloe v. Riggs, 1 Pet. 591, 596, 26 U.S. 591, 596, 7 L.Ed. 275, "The rule of law is, that the best evidence must be given of which the nature of the thing is capable; that is, that no evidence shall be received, which presupposes greater evidence behind, in the party's possession or power." On this basis, the courts have recognized many situations under which so-called secondary evidence is admissible. Among these situations is the one where the original document accidentally has been lost or destroyed, United States v. Pendell, 185 U.S. 189, 22 S.Ct. 624, 46 L.Ed. 866; Robertson v. Pickrell, 109 U.S. 608, 3 S.Ct. 407, 27 L.Ed. 1049; United States v. Sutter, 21 How. 170, 16 L.Ed. 119; where it has voluntarily been destroyed in the course of business or by mistake, Tayloe v. Riggs, supra; McDonald v. United States, 8 Cir., 89 F.2d 128; where it is suppressed by the opponent of the party offering it, Morris' Lessee v. Vanderen...