Worden v. United States

• Decision Date: 11 April 1913
• Docket Number: 2,213.
• Parties: WORDEN et al. v. UNITED STATES.
• Court: U.S. Court of Appeals — Sixth Circuit

204 F. 1

WORDEN et al. v. UNITED STATES.

No. 2,213.

United States Court of Appeals, Sixth Circuit.

April 11, 1913

F. P Sullivan, of Sault Ste. Marie, Mich., and C. A. Withey, of Reed City, Mich., for plaintiffs in error.

F. C Wetmore, of Grand Rapids, Mich., for the United States.

Before WARRINGTON and KNAPPEN, Circuit Judges, and SANFORD, District judge.

KNAPPEN Circuit Judge.

Plaintiffs in error and one Duell were jointly indicted under section 5440 of the Revised Statutes (U.S.

Comp St. 1901, p. 3676) on a charge of conspiracy to defraud the United States in the purchase of certain public lands under the Timber and Stone Act (Act June 3, 1878, c. 151, 20 Stat. 89 (U.S. Comp. St. 1901, p. 1545)). The gist of the fraud charged in the two counts submitted lay in the procuring of the lands through alleged 'dummy' entrymen (one Mrs. Craig and one Alexander) by false and fraudulent representations contained in the respective applications for purchase and in the final proofs, to the effect that the applicant had no agreement or contract with any one whereby the title which he might acquire from the United States should inure, in whole or in part, to the benefit of any one except himself; it being alleged that the purchases were intended for the benefit of plaintiffs in error, said Duell, one Simonds, and the J. H. Worden Lumber & Shingle Company, which we shall hereafter call the Lumber Company.

January 1, 1906 (or 1905), Worden purchased a sawmill plant in Trout Lake township, Chippewa county, Mich., 38 miles form Sault Ste. Marie, the postoffice being called 'Dick.' He remained owner until some time in August, 1906, when the Lumber Company was incorporated under the laws of Wisconsin. Worden was thereafter president and manager of the company. Person was superintendent for Worden after January 1, 1906, and until the Lumber Company was organized. Thereafter he held the same relation toward the company until December, 1906, or January 1, 1907, when he retired. Duell entered the employ of Worden, or of the Lumber Company, in the summer of 1906, being in the company's employ after its organization. He looked after the office and store and kept the books, and was assistant postmaster. January 1, 1907, on Person's retirement, Duell became superintendent. Simonds was a land looker and timber estimator for Worden up to the Lumber Company's organization, and thereafter acted for that company. Simonds died before the indictment was returned. Upon the trial Duell was acquitted; Worden and person were convicted. The denial of request to direct verdict for defendants, and the admission of certain evidence complained of, require reference to some features of the testimony.

Mrs. Craig's application was signed July 31, 1906. She executed final proofs October 24th of the same year, and on December 17, 1906, conveyed to the Lumber Company the lands covered by her entry. Alexander's application was dated August 24, 1906, his final proofs were executed November 28th, and on December 9th of the same year he conveyed to the Lumber Company the lands so purchased. Duell was a witness under Mrs. Craig's application, and Simonds was a witness under the application of Alexander. Entries on the books of Worden or of the company, or both, in connection with expert testimony, tended to show the advancement of money to pay the expenses of both applicants and their witnesses to Sault Ste. Marie, when the entries were made, as well as for paying the government fees upon application and the moneys required to be paid on final proofs. The book entries also tended to show that not only the moneys advanced to pay the government for the land, but also (in the case of at least one of the applicants) the moneys advanced for expenses connected with the making of application were deducted from the amount paid the applicant on conveyance to the Lumber Company. Twenty-seven other entries for purchase under the Timber and Stone Act were made between May 7 and November 15, 1906, principally by employes of the Lumber Company, or their wives or near relatives, including Duell, Person, and Simonds. Duell was a witness under 5 of these applications, Simonds in 18 cases, and Person in 5. Other employes of the Lumber Company acted as witnesses in still others of those applications. In many cases several of the applications were presented at Sault Ste. Marie on the same day. Each of these 29 applications, as well as the final proofs thereunder, contained the applicant's statement negativing the existence of any agreement or contract with any person whereby the title to be acquired from the United States should inure to the benefit of any one except the applicant. The books of account referred to tended to show that advances were made to a majority of the 27 other applicants on or about the dates of the signing of their respective applications for purchases from the government, and that payments were made to many of them on or about the date that final proofs were executed. Nearly all of them are affirmatively shown to have conveyed to the Lumber Company the lands so purchased soon after making final proofs. In the case of some at least, the book entries, in connection with the expert testimony, tended to show that the amounts so advanced, both at the dates of signing the applications and at the times when final proofs were executed, were deducted from the purchase price paid by the Lumber Company for the lands. The government produced none of these 2. applicants as witnesses. Two of them (other than Alexander and Mrs. Craig), as witnesses for respondents, testified to the absence of any agreement or understanding with respondents, or either of them, prior to the making of their respective applications. Person testified to his ignorance of anything 'crooked' with reference to any of the land purchases in question; that he gave no encouragement to any of the entrymen to take up any of the lands in question; that he made his entry on his own account, and sold it to Worden personally only upon severing his connection with the company. Worden and Duell were not sworn upon the trial, but their affidavit, taken by an examiner of the Government Land Office during the investigation, contained a denial of the advancement of money to any of the claimants, 'directly or indirectly, for the purpose of making timber and stone entries of government lands,' or to any one for expenses in going to Sault Ste. Marie to make filings or final proofs.

The rule is well settled that the Timber and Stone Act does not forbid an entryman who has in good faith acquired a holding under the act to alienate his interest in the lands prior to the issuing of final certificate. All the act denounces is a prior agreement by which the entryman acts for another in the purchase. United States v. Budd, 144 U.S. 154, 163, 12 Sup.Ct. 575, 36 L.Ed. 384; Williamson v. United States, 207 U.S. 425, 460, 28 Sup.Ct. 163, 52 L.Ed. 278; United States v. Biggs, 211 U.S. 507, 519, 29 Sup.Ct. 181, 53 L.Ed. 305.

This rule was clearly recognized and applied by the trial judge, who properly instructed the jury, among other things, that the Lumber Company had a right to give it out that it wished to buy timber, and that it had the right to loan money to the entryman (so long as there was no arrangement or understanding that the company should ultimately get the land), and had the right to purchase incomplete entries made in good faith, and to pay the money required on the final proofs.

In our opinion the testimony was sufficient to sustain a conviction of both plaintiffs in error, provided the books of account and the record of the 27 other applications for land purchases are to be given the force which the government claims for them. The Budd Case, before cited, is not opposed to this conclusion. That case (which was a suit to cancel a patent) differs from the instant case, in that there was in the Budd Case nothing directly connecting the entryman's vendee with the original entry, or showing that the entryman or his vendee even 'knew of the existence of the other until after the entryman had fully paid for the land.'

We think it was competent for the government to show the making of the 27 other entries. The defendant's good faith in the Alexander and Craig transactions was the crucial question. It was the government's theory that these two entries and the purchase thereunder were part of a broader underlying conspiracy to procure public lands in fraud of the provisions of the Timber and Stone Act, and we think the testimony substantially tended to sustain that contention. The rule in such cases is that proof of other acts of a similar character at or about the same time, and with like alleged fraudulent purpose, may be shown as bearing upon defendants' good-faith conduct with respect to the particular offense charged, provided the ultimate effect of such evidence as to other transactions is clearly limited to the question of intent or good faith with respect to the particular offense for which the defendants are on trial. New York Mutual Life Ins. Co. v. Armstrong, 117 U.S 591, 598, 6 Sup.Ct. 877, 29 L.Ed. 997; Wood v. United States, 16 Pet. 342, 360, 10 L.Ed. 987; Olson v. United States (C.C.A. 8), 133 F. 849, 854, 67 C.C.A. 21; Sapir v. United States (C.C.A. 2), 174 F. 219, 98 C.C.A. 227. The Budd Case does not conflict with this rule or with its application here. What was there said regarding evidence that the purchaser from the entryman in question had made with another entryman, prior to the latter's entry, an agreement to purchase the land so entered, had special reference to the probative force of such fact considered in connection with all the evidence in the case. In the instant case the jury was instructed...