Case ID: tenn_22/html/0483-01.html
Source: Caselaw Access Project
Author: {"author": "Reese, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Budd vs. The State.
    1. Where an indictment is framed on a statute, it is not necessary that it should be in the express words of the statute. It is sufficient if words of equivalent import or of more comprehensive import be used.
    2. The 22cl section of the act of 1832, incorporating the Union Bank, provides, that if any of “the officers, agents or servants” of the bank, shall embezzle the funds of the bank, or make false entries, they shall be guilty of felony: An indictment charged ‘•that Budd being then and there employed as clerk of the individual ledger, the same being a book of the bank thereinafter named,” and the “said Budd being then and there clerk as aforesaid, and it being his business, by virtue of said employment as clerk, to make entries,” did make false entries with view to defraud the bank. The court determined that the defendant was not properly charged, and that the term “clerk” was one of such varied import, that they were not at liberty to hold that it was equivalent to the term officer, agent or servant.
    3. The 22d section of the act incorporating the Union Bank of the State of Tennessee, which makes it a felony in the officers, agents or servants of said corporation to embezzle or appropriate without authority, the funds of the corporation, or make false entries with a view to defraud the corporation, is a partial law, because it does not embrace all persons in like state, and surrounded by similar circumstances, and therefore unconstitutional and void.
    4. The legislature have the power to pass a law making such acts felony in the officers servants and agents of all the banking corporations of the State of Tennessee.
    The Union Bank was incorporated in 1832. It was put in operation, and Thomas L. Budd was employed as a clerk in the bank from July 1836, to March 1841. During a portion of this time he was employed in posting the individual ledger, a book in which the accounts of depositor's were kept. He was required to write out and balance the bank books of customers monthly, and to furnish the Cashier with a balance sheet at the end of each quarter, exhibiting therein a true statement of the indebtedness of the bank to depositors, and the indebtedness of depositors to the bank by over drafts. One H. A. Cargill, a customer of the bank, drew from the bank, by check, the sum of $1,608 09 more than he had deposited, and Budd the clerk, on the 30th June, 1838, by a false entry of a credit to Cargill of $1,608 09 balanced his account.
    He was indicted in the circuit court of Davidson county, at the May term thereof, 1841, for making a false entry with a view to defraud the bank. Upon the establishment of the criminal court, the case was transferred to that court. The defendant pleaded not guilty, and the case was submitted to a jury, Turner, judge, presiding, at the March term, 1842.
    
      The judge charged the jury as follows:
    “This is a prosecution commenced by the State of Tennessee, against the defendant for making a false entry, as in the indictment alledged. In order to come to a proper and just conclusion between the State and the defendant, you will enquire, 1st. whether there was in existence any such institution as the Union Bank of Tennessee, on the 30th day of June, 1838, the day upon which the alledged false entry, in the indictment, purports to have been made. For proof of this point of the charge in the indictment, you will look to the act of incorporation and charter of the Bank, which have been read to you, and will be by the jury regarded as'legal testimony.
    “Should you find from the testimony in the case, that there was such an institution as alledged in the indictment, you will then proceed to inquire next, if the defendant, Thomas L. Budd, was a clerk in said Bank, and employed by the same as clerk of the individual ledgerj’and to ascertain the truth of this allegation, you will again recur to the testimony, and if it be of that character that will convince you that the fact was so, (for you are to judge solely of the testimony in the cause,) you will then next proceed to enquire whether the defendant did on the 30th day of June, 1838, fraudulently and feloniously make a false entry in the account of Henry A. Cargill, in said book called the individual ledger, as alledged in the indictment. When you come to consider this part of the indictment, which is the gist of the offence, you will determine, 1st. whether there was an entry made in said book, as alledged in the indictment. For the proof of this fact you will again recur to the testimony. You have inspected the book; you have heard the testimony, and you will determine from the testimony all taken together, how this fact is. If you shall find from the testimony, that the defendant made in the book an entry in figures of 1608 09, that in legal contemplation, would be entry of those figures on the book. ' If you should find this fact as alledged in the indictment, that is, that an entry was made, you will next proceed to enquire whether the entry was made falsely and fraudulently. Was it made falsely? was it false? what is meant by this in legal contemplation? if in truth, in fact, the said Cargill had made no deposite of the sum specified in the indictment, and the entry was made on the book, showing that he had made a deposit, this in legal contemplation would be a false entry, provided it was done with the intent to defraud the Bank. This is not a question. of law but a question of fact, to be by you determined from the whole testimony in the cause. With the intent to defraud the Bank — this involves the consideration of the motives of the defendant; if the entry was made by mistake, or if the entry is a proper and correct entry so far as it goes, and there was a mere unintentional omission to complete it, it could not then be said to be done with the intention to defraud the bank, but if on contrary, there is in the entry itself or in the testimony all taken together, that which shows that the defendant made the entry with the intent to defraud thé Bank, then the offence would be complete, and the defendant would be guilty as charged in the indictment.
    “It is further proper that the court should declare to you, its opinion upon the 22d section of the statute, it being the section under which this indictment is framed, and this proceeding is had. It is insisted that the same is unconstitutional and void. Let us see how this is; because if the statute is unconstitutional, it is inoperative in law and the prosecution would be at an end. It is contended by the counsel for the prisoner, thatitis in contravention of that section of our constitution, which says, that no man shall be disseised or imprisoned, &c., but by the judgment of his peers or the law of the land. Whenever the legislature passes a law, the presumption is in favor of the power, nor are we to disregard the law upon a mere doubt. What is the meaning of the words “the law of the land” in our constitution? it means a general and public law, operating upon every individual in the community equally. Now it is admitted that the legislature may pass laws affecting a certain class or character, and they would not be in violation of the constitution. This the court considers to be a law of that description; then the law enacts, that if any cashier, agent, servant or any other officer of the corporation, shall do particular things that are by the statute forbidden, then they shall be punished in the manner prescribed by the statute. This is a general law, because it embraces all of a certain class or character; it embraces all cashiers, agents, servants or other officers; and there is nothing to prevent any citizen or person from exercising any of said offices or stations in the bank. It is not a partial law within the meaning of the constitution, for the same reason that it embraces a class of persons and covers all that may act in the character pointed out by the statute. Wherefore the court will charge you, that the law does not conflict with that section of the constitution, which says, that no freeman shall be taken, or imprisoned, or disseised of his freehold liberties or privileges, or outlawed or exiled, or in anyway deprived of his property or liberty, but by the judgment of his peers or the law of the land, but that the same is in conformity thereto: nor is it inconsistent with the 7th sec. and 11th article of our constitution, which says, that the legislature shall have no power to suspend any general law of the land for the benefit of any particular individual, nor to pass any law for the benefit of individuals, inconsistent with the general laws of the land, granting to individuals rights, privileges, immunities or exemptions, other than such as may be by the same law extended to any member of the community, who may be able to bring himself within the provisions of the law; provided, always, the legislature shall have power to grant such charters of incorporation as they may deem expedient for the public good. The court cannot see that any general law of the land is suspended by the 22d section of the statute, nor can the court see that it is inconsistent with any general law of the land. It is said there is no law making this an offence in the Bank of Tennessee. This may be true, yet it does not follow as a legal consequence therefrom, that the legislature has no power to say, that persons of a particular class or character, exercising certain duties, in a certain bank, shall be punished for the eommision of certain offences. The Union Bank is a public institution. What is there in the constitution to prevent the legislature from passing a law, saying, that all persons exercising certain vocations in a public institution, for certain misfeasances or non-feasances, shall be punished in a particular way or manner? It is a law operating upon every member of the community, for the reason before stated, that every member of the community could bring himself within the operation of the law, by exercising in the bank any of the offices or vocations mentioned in the statute. Therefore the court will charge you further, that the 22d section of the statute, the same being the statute under which this prosecution is had, is constitutional and valid, and is to be by you regarded as the law of the land. A further objection is made to the indictment; it is proper that the court should declare the law arising upon this question also. The indictment charges that the defendant was a clerk of the Union Bank; and the counsel for the prisoner contends that proof of his being a clerk will not satisfy the law, it being stated in the law, that it must be done by a cashier, agent, servant or any other officer of said corporation.
    “The court charges the jury that the allegation in the indictment, charging Thomas L. Budd as a clerk of said Bank, is a charge that said Budd is an officer of said corporation; and the charge so made in the indictment is sufficiently made under the law. There is no necessity that the allegations in the indictment, should be made in the words of the statute; if they are charged in terms equivalent to it, bearing the same import, it is sufficient. Therefore the court charges you, that it is not necessary after the allegation is made in the indictment, charging the defendant to be a clerk in said Bank, to charge further that he was either a servant or an officer of said corporation.”
    The jury returned a verdict of guilty, and fixed the term of the defendant’s imprisonment at five years.
    A motion for a new trial was made and overruled, and judgment rendered. The defendant appealed in error.
    This case was argued by Mr. Fletcher and Mr. Ewing for the plaintiff in error; and by Mr. Washington, Mr. Hollings-worth and the Attorney General on behalf of the State.
   Reese, J.

delivered the opinion of the court.

The prisoner was indicted for making a false entry on the books of the Union Bank with the intention to defraud the bank. The indictment is founded upon the 22d section of, “ail act to charter the Union Bank of the State of Tennessee,” 1832, ch. 2. That section enacts, “that if the Cashier or any other of the officers, agents or servants of said corporation, shall -embezzle, and without authority from the President and Directors of said Bank, appropriate any of the funds of said corporation to his own use, with intent to cheat and defraud the President, Directors and company of said bank, or shall fail to make correct entries, or shall make false entries upon the books of said bank, with intent to defraud said bank or anjr other person whatsoever, said officer, agent or servant of said bank, shall be held and deemed guilty of felony, and shall upon conviction thereof, be sentenced to confinement in the jail and penitentiary of this State, for a period not less than five nor more than twenty years.” The indictment sets forth, that “Thomas L. Budd being then and there a person employed as clerk of the individual ledger, the same being a book of the bank thereinafter named, in the bank of the president, directors and company of the Union Bank of the State of Tennessee, &c., and the said Thomas L. Budd being then and there such clerk as aforesaid; and it being his business by virtue of such employment as such clerk, then and there to make correct and true entries of the sums of money deposited in said bank by the individual depositors on the day and year aforesaid,” &c. The indictment here proceeds to set forth the false entry.

Two questions have been discussed, which we consider of most importance in this case.

1st. Whether the prisoner, in 'the indictment before us, has been properly and sufficiently charged within the terms of the 22d section of the statute above quoted, and,

2dly. Whether that section, with reference to our constitution, can be regarded and enforced as the “law of the land.”

1st. The penalties imposed by the section of the statute in question affect the cashier, or any other of the officers, agents or servants, of the corporation, clerks not being mentioned nominatim. Dictionaries, legal and literary, have been referred to, on both sides of the question, to prove that clerks, in banks, are, and axe not, properly comprehended and described by the terms officers, servants or agents. And the 5th section of the same act has been referred to, to show that in the opinion of the legislature the terms “officers” and “servants” did not properly include clerks; for that section empowers the directors to appoint such “officers, clerks and servants under them as shall be necessary,” &c. Giving to the terms officers, agents and servants, as used in the 22d section, a reasonable construction, we cannot doubt that the duty of clerk would fall within the just meaning of some one of them; within which, it is not necessary to determine; because the indictment, in this case, does not aver that the prisoner at the bar was the officer, agent or servant of the bank. It is contended, however, on the part of the State, that it is not necessary that an indictment should literally pursue the terms of the statute upon which it is founded, but if words fully equivalent in meaning to those used in the statute, or more comprehensive, be employed in an indictment, the indictment will be held to be valid. This is indeed correct, and held to be so, in the case of the State vs. Peek, 2 Hum. and in other cases. But these cases have reference to the terms used in describing the mode, manner, and motives constituting or accompanying the offence; and it may well be doubted, whether this principle will apply to a case where a statute affects persons as connected with specified offices, or employments; there, it would seem, that whatever other office or employment may be stated in the indictment, it should be averred to be the office or employment mentioned and described in the statute. But be that as it may, the term clerk is of such varied import, that we are not at liberty to hold that “clerk,” and especially “clerk of the individual ledger,” is equivalent to officer, agent or servant. Besides, there is no direct averment that the prisoner was employed by the bank as clerk; that, at most, can only be gathered by intendment. He may have had charge of the book called the individual ledger, for aught that directly appears, not by employment under the bank, but by employment under some one who was, himself, an agent or servant of the bank. Although the book belonged to the bank, he may have been employed as a clerk, not of the bank, but of some individual officer, for any thing that is averred- We think, therefore, that the defendant was not properly charged under the statute, and that the judgment must be arrested.

2d. But a graver and weightier question. exists. That question is, whether, in reference to our bill of rights, the 22d section of the act referred to, can be regarded and enforced as the “law of the land.” And it may be remarked, as preliminary to this investigation, that it has not been contended here, on the part of the State, that any argument in favor of the validity of the section in question can he founded upon the connection in which it exists, as part of a law granting a charter to the Union Bank; in other words, that it is not to be regarded as part of the contract between the State and that corporation; and, even, if so regarded, that it would derive no additional validity from that circumstance. This has been properly conceded; for surely the State, as a contracting party, would have no greater right to create the felony in question, in reference to the officers of the Union Bank, than it would possess independently of such attitude. The section twenty-two, then, is to be regarded as if it stood alone; and as if, aloof from all connection with the charter of the Union Bank, it had been a statute of one section, enacted, after that institution had full corporate existence, with aviev/to make the felony in question, affecting the officers, agents and servants of that institution. It is an act, then, creating a new felony in relation to the officers, servants and agents of the Union Bank, and to them only. Is this a “law of the land” in the sense of our bill of rights? Law, to use the definition of Mr. Justice Blackstone a little modified, to suit the genius of our institutions, “is a rule of civil conduct prescribed by the law making power of the State, commanding what is right or prohibiting what is wrong.” This, then, is a rule of conduct prescribed by the legislature, and directed to the officers, agents and servants of the Union Bank, prohibiting them from doing what is wrong. What is the Union Bank? It is a legal person, having capacity to sue and be sued; to own property, and to employ agents and servants, This, then, is a rule mandatory to the servants and agents of this legal person. It expends all its force upon them. This statement of the ques-lion, merely, goes far, it seems to us, to supersede the necessity of elaborate reasoning on the subject. Not, indeed, upon the ground that the officers, servants and agents of this legal person, the bank, are more or less numerous, but because the officers., agents and servants of this person only, and not of any other persons, are comprehended or affected. If the felony were enacted with regard to the clerks, servants and agents of a merchant, to deter them from embezzlement and false entries, would it be imagined, for a moment, that it would be regarded as the “law of the land,” and consistent with the bill of rights? If the felony affected only all the clerks of all the merchants of Nashville, or of Davidson county, or of Middle Tennessee; would that, in either case, be “the law of the land”? It is believed, none would so contend. And, why not? Simply because the law of the land is a rule alike embracing, and equally affecting all persons in general, or all persons who exist, or majr come, into the like state and circumstances. A partial law on the contrary embraces only a portion of those persons who exist in the same state, and are surrounded by like circumstances. If peculiar felonies, affecting all the people, or certain of the public officers, of East Tennessee, only, were held to be “the law of the land,” it would be difficult to say for what object that clause was inserted in the bill of rights. One of its objects has been stated, in various adjudications in our State, to have been to protect the feeble and the obnoxious from the injury and injustice of the strong and the powerful, and, in general, to protect minorities from the wrongful action of majorities. This being its scope and purpose, would it not interdict the legislature from passing such an act as is last above referred to, for instance, creating certain acts of nonfeasance or malfeasance of the Register of the Western District, although a public officer, a felony, leaving the Register of Middle Tennessee, East Tennessee, &c., unaffected by it? Certainly it would. And why? Because the law would not treat, similarly, all who were in like circumstances; it would therefore' be partial, and of course not the law pf the land. At the time of the enactment of this statute, there were other banks having actual corporate existence, as we can see from our statute book, with like faculties and functions. They were not embraced; other banks had a potential existence, that is, the legislature had power to make others. The act, however, em-> braces the Union Bank alone and its servants, See., and not alt who are, or may be in the like state and circumstances. If, as in Alabama and Arkansas, the legislative power being constitutionally expended by the creation of one bank, a felony had been created, limiting itself in its terms to the bank established, we do not doubt, that under such a bill of rights as ours, such law would be constitutional. We do not think the law in question partial, because merchants’ clerks, or the public officers, called clerks, were not embraced; but because, the officers, agents and servants of banks in general, persons in like situation and circumstances, were not embraced. It matters not how few the persons are, if all, who are, or may come into the like circumstances and situations, be embraced, the law is general, and not a partial law. The principles here set forth are not new in this State; they are little more than the re-announcement of what is said in 2 Yerg. 260, 554, 559, 4 Yerg. 202, 5 Yerg. 320, 10 Yerg. Jones vs. Perry. Thpse cases, indeed, refer themselves to the operation of partial laws upon civil rights and remedies, while this case happens to be the application of our bill of rights to a partial law creating a felony. But the principles are identical, and there is certainly no reason why the protection intended to be extended to individuals by the bill of rights, should not be as effective, where their liberty, as well as their property, may be exposed to the operation of a partial law.

We are duly sensible of the importance of the case before us, and of the magnitude and value of the interests involved. Although the bank, no doubt, mainly relies, for its safety, upon the probity of its officers, and the amount of their bonds, and the solvency of their sureties, still the facts upon this 'record establish, that they need, also, the safe-guards intended to, have been thrown around them by the penalties created in the 22d section of their charter; and we have the satisfaction to believe, that the interval is a brief one, which shall elapse, before those safe-guards shall be restored, and made effective in a manner consistent with the public liberty- As to the co-ordinate department, to whose enactment we feel unable to give effect, we cheerfully acknowledge, that their intelligence, and numbers, the high motives and sanctions under which they, too, act, impose upon us the obligation, when comparing the result of any deliberation of theirs, with the paramount law, which governs us all, to be well satisfied, that in declaring a statute invalid and void, we but obey the mandate of the constitution. But when so satisfied, it requires but ordinary virtue and firmness in this court, so to pronounce. In this case, we are thus satisfied, and must thus pronounce.