Title: State v. Weigel

State: north-dakota

Issuer: North Dakota Supreme Court

Document:

165 N.W.2d 695 (1969) STATE of North Dakota, Plaintiff and Respondent, v. Plus T. WEIGEL, Defendant and Appellant. Cr. 377. Supreme Court of North Dakota. February 25, 1969. *696 Maurice G. LaGrave, Mandan, for appellant. Helgi Johanneson, Atty. Gen., and Donald R. Holloway, Sp. Asst. Atty. Gen., Bismarck, and Lester J. Schirado, State's Atty. for Morton County, Mandan, for respondent. ERICKSTAD, Judge (on reassignment). By information dated February 24, 1967, the defendant, Pius T. Weigel, was charged in the District Court of Morton County with having sold a security while not registered as a securities dealer or salesman. Through a similar information Carl Weisser was charged with the same offense, and the two informations were consolidated for trial. The trial resulted in verdicts of guilty, and it is from the judgment and sentence entered upon the verdict finding Mr. Weigel guilty that he now appeals. The facts essential to our consideration of Mr. Weigel's contention on this appeal were summarized by Chief Justice Teigen in the decision which considered Mr. Weisser's contentions on his earlier appeal as follows: The two defendants, Weisser and Weigel, together approached one Henry Entzel and stated that they wished to borrow $25,000.00, which would be repaid in 60 days. Mr. Entzel did not agree to loan them this amount of money but did loan them $2,500.00 to be repaid in 60 days. The defendants in return gave Mr. Entzel a promissory note dated May 21, 1966, written on a standard note form furnished by the defendants in the amount of $3,000.00, payable in 60 days and bearing interest at 7 per cent per annum. The blank spaces on the form were filled in by the defendant Weisser and each defendant signed the note as a maker. The transaction was completed in the presence of Mr. Entzel. The defendants paid the sum of $400.00 to apply on this note but no additional payments have been made. It is upon this transaction the defendants were charged. The issue in Weisser relating to the issue in this case was stated by the Chief Justice as follows: In this connection the court said: Counsel for Mr. Weigel asserts that the theory upon which the Weigel defense was made is that, although the note on its face was negotiable, it was in fact, as brought out on cross-examination, not a negotiable note, and that therefore the note did not come within the provisions of the Securities Act. It is his position that a note, to come within the Securities Act, must be a negotiable note, and for this he relies on the definition contained in § 41-01-02 as it read at the time of the alleged offense: Chapter 10-04 of the Code contains our statutory provisions on securities, and § 10-04-02(12) defines security as follows: Had the legislature intended that only a negotiable note should constitute a security, it could very easily have so indicated in subsection 12. As it merely used the term note, we cannot assume that it intended to restrict the coverage of the Act to negotiable notes. We point out further that the definition of a note contained in § 41-01-02 is by that very section restricted to title 41, which relates only to negotiable instruments. In construing legislation generally it is our duty to attempt to determine legislative *698 intent, and when that intent is directed toward an objective not prohibited by the state or federal constitutions, our construction of the legislation should be in aid of and compatible with this intent. Our statutes imposing criminal penalties are to be given similar breadth. One of the basic objectives of the Securities Act is the avoidance of fraud or deception in the sale of securities. That this is so may be noted by consideration of the first sentence of § 10-04-08.1, a part of which reads: Our construction of the Securities Act is in line with that objective. Accordingly, we find no error in the trial court's refusal to give the instructions which had as their core the basic idea that a note, to come within the Securities Act, must be a negotiable note. The judgment and sentence of the trial court are therefore affirmed. TEIGEN, C.J., and STRUTZ, KNUDSON and PAULSON, JJ., concur.