United States v. Leach

• Decision Date: 15 June 1970
• Docket Number: No. 7532,7533.,7532
• Citation: 427 F.2d 1107
• Parties: UNITED STATES of America, Appellee, v. Ronald LEACH, Defendant, Appellant, UNITED STATES of America, Appellee, v. Jerome TREMONT, Defendant, Appellant.
• Court: U.S. Court of Appeals — First Circuit

427 F.2d 1107 (1970)

UNITED STATES of America, Appellee, v. Ronald LEACH, Defendant, Appellant, UNITED STATES of America, Appellee, v. Jerome TREMONT, Defendant, Appellant.

Nos. 7532, 7533.

United States Court of Appeals, First Circuit.

June 15, 1970.

Bernard A. Dwork, Boston, Mass., with whom Enid M. Starr and Dwork & Goodman, Boston, Mass., were on brief, for Ronald Leach, appellant.

James D. St. Clair, Boston, Mass., with whom William E. Bailey and Hale & Dorr, Boston, Mass., were on brief, for Jerome Tremont, appellant.

Joseph A. Lena, Asst. U. S. Atty., with whom Herbert F. Travers, Jr., U. S. Atty., was on brief, for appellee.

Before ALDRICH, Chief Judge, McENTEE and COFFIN, Circuit Judges.

McENTEE, Circuit Judge.

Defendants Tremont and Leach were found guilty of three counts of an indictment charging violations of 18 U.S. C. § 1010¹ by making false statements in an application for a Title I home improvement loan. The charges arose out of a $3,000 loan obtained from the Lynn Safe Deposit and Trust Company in May 1968, purportedly to improve a building the defendants were in the process of buying. Count I charged them with stating in the loan application that the proceeds would be used to improve the property, knowing such representation to be false. Count II charged the making of a false statement by omitting to list an outstanding indebtedness on the FHA credit application as required by law. Count III charged that the defendants, with "divers other persons unknown," had conspired to make false statement for the purposes described as illegal in § 1010.

Defendants first contend that there is a fatal variance between the offense charged in count II and the evidence offered by the government. This count charged that in making out the loan application, defendants failed to list a debt owed to Empire Homes, Inc. "to be secured by mortgage," on premises at 13 Pickman St., Salem, Massachusetts.² At the time the application was made, defendant Tremont had signed a purchase and sale agreement with Empire Homes to buy the Pickman St. property, in which he promised to assume the first mortgage and to take out a second mortgage. Defendants argue that the proof showed that the second mortgagee was one Temkin, not Empire Homes, and that the variance is significant because it confused the witnesses and required the listing of a mortgage indebtedness before the mortgage had come into existence.

This argument is singularly without merit because the debt which the government claims was omitted was not the mortgage but the obligation evidenced by the purchase and sale agreement. The government stated this explicitly in its answer to defendant's motion for a bill of particulars. The FHA form requires not only that mortgages but all "fixed obligations" be listed.

Defendants' next contention, going to the conspiracy count, is that the trial court committed reversible error in denying, in part, their request for a bill of particulars. Count III charged that pursuant to the conspiracy to falsify the application, defendants had committed "the following and other overt acts." Six acts were spelled out in the indictment. Defendants claim they were prejudiced by the denial of their motion to require the government to specify the alleged false statements, the name of the defendant making each statement and, most importantly, the "other overt acts."

The function of a bill of particulars is to protect against jeopardy, provide the accused with sufficient detail of the charges against him where necessary to the preparation of his defense and to avoid prejudicial surprise at trial. United States v. Tanner, 279 F.Supp. 457, 473-474 (N.D.Ill.1967); United States v. Smith, 16 F.R.D. 372, 374-375 (W.D.Mo.1954); 8 J. Moore, Federal Practice § 7.06 1 (1969). Although the 1966 amendment to Fed.R. Crim.P. 7(f) was intended to liberalize discovery, Walsh v. United States, 371 F.2d 436 (1st Cir.), cert. denied, 387 U. S. 947, 87 S.Ct. 2083, 18 L.Ed.2d 1335 (1967), the power to grant or deny particulars is still entrusted to the sound discretion of the trial court. It has long been established that actual prejudice to the defendant must be shown to justify reversal. Wong Tai v. United States, 273 U.S. 77, 82, 47 S.Ct. 300, 71 L.Ed. 545 (1927); 1 C. Wright, Federal Practice and Procedure § 130, at 295 (1969).

Defendants claim they were prejudiced by the testimony of Kenneth Smith, the bank's former loan officer, and the prosecution's chief witness. They claim they had no way of knowing that the government would attempt to show that Smith was part of an ongoing conspiracy tying them into an illegal transaction. In particular, defendants claim they were prejudiced because they were unable to lay a foundation for an attack on Smith's mental capacity.³

From our examination of the record we are satisfied that the defendants were not prejudiced by the court's denial of the particulars. First of all, they were well informed by the indictment as to the nature of the charges, the name of the bank, the property involved, pertinent dates and six overt acts. The fact that Smith was a key figure in the transaction and not a secret informer should have alerted the defendants to the likelihood of his being called to testify. It seems to us that normal investigation would have disclosed the further information they required. See Walsh, supra, 371 F.2d at 437. Furthermore, counsel for both defendants subjected Smith to rigorous cross examination. In the course of the questioning, they brought out inconsistencies in his testimony and elicited the information that he had a criminal record and that there was then pending a motion for reduction of sentence in two similar cases.

Although it would have been better practice for the court to have granted the motion, see United States v. Covelli, 210 F.Supp. 589, 590 (N.D.Ill.1962), we do not find that the defendants were prejudiced by its failure to do so. United States v. Cudia, 346 F.2d 227, 228 (7th Cir.), cert. denied, 382 U.S. 955, 86 S.Ct. 428, 15 L.Ed.2d 359 (1965). Indeed, our language in Nesson v. United States, 388 F.2d 603, 604 (1st Cir.), cert. denied, 391 U.S. 920, 88 S.Ct. 1807, 20 L.Ed.2d 657 (1968), seems particularly appropriate here:

"While it would have been better for the government to have disclosed certain record information which might have aided the defendant in his defense, it seems reasonably apparent from an examination of the transcript that the defendant did not avail himself of what information he did have, and was not as surprised as he claims on this appeal."

Defendants also contend that there is a fatal variance between the allegations in count III and the government's proof, in that a conspiracy was charged with "divers unknown persons" at a time when Smith's involvement was known to the government. Aside from the fact that they failed to object and thus did not preserve their rights, this contention seems to be based on a mistaken impression that Smith had testified before the grand jury. Their acknowledgment on oral argument that Smith had not so testified makes further discussion of this point unnecessary.

Defendants also appeal from the denial of their motions for judgment of acquittal and for new trial. In reviewing the denial of a motion for judgment of acquittal, the pertinent question is whether the trial court had reason to believe that there was sufficient evidence on which reasonable persons could find guilt beyond a reasonable doubt. Parker v. United States, 378 F.2d 641 (1st Cir.), cert. denied, Perma-Home Corporation v. United States, 389 U.S. 842, 88 S.Ct. 81, 19 L.Ed.2d 107 (1967); Crawford v. United States, 126 U.S. App.D.C. 156, 375 F.2d 332, 334 (1967). When we apply this test, and view the evidence must favorably to the government, we conclude that the court below did not err in sending the case to the jury.

Motions for new trial are directed to the trial court's discretion. Under its broad power, the court may weigh the evidence and consider the credibility of the witnesses. The remedy is sparingly used, the courts usually couching their decisions in terms of "exceptional cases," United States v. Pepe, 209 F.Supp. 592, 595 (D.Del.1962), affirmed, 339 F.2d 264 (3rd Cir. 1964), "miscarriage of justice," United States v. Parelius, 83 F.Supp. 617, 618 (D. Haw.1949), and where "the evidence preponderates heavily against the verdict," United States v. Robinson, 71 F. Supp. 9, 10-11 (D.D.C.1947). Rule 33 itself provides that the court may grant a new trial where required "in the interest of justice." Applying these standards, we reject the defendants' contentions. Smith testified unequivocally that the defendants wanted to use the money to buy into a business,⁴ and that they talked about a job for him. There was also testimony that a portion of the loan money was used to cover an overdrawn checking account. If the jury chose to credit this testimony regarding the purpose of the loan, it was sufficient to sustain the conviction under count I.

As to count II, defendants contend that the government failed to meet its burden of proving that the omission in the FHA form was done with the requisite intent. The offense set forth in § 1010 requires proof of three elements: the making of a false statement in the application, knowing it to be false, for the purpose of obtaining a loan from the lending institution and influencing the FHA. United States v. Pesano, 293 F.2d 229, 231 (D.C.Cir. 1961). The ingredient of intent must be found in the facts and the surrounding circumstances. Pesano,supra. Defendant Leach testified that the reason he left blank the indebtedness portion of the FHA form was that with two mortgages on the property his payments would exceed the rental income and he hoped to consolidate them. Thus the omission was not accidental. When he signed the certification clause that all statements were true he knew that not to be the case. Moreover,...