Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1905-01-11
THE cARMEAN DECISION.
Senator Carney Secured Notable De-
cision From the Supreme Court in
This Case.

cision From the Supreme Court in
This Case.
The reversal of the district court in
the Carmean case, in which the sup
RENE court exonerates Carmean of the
charge of elnbezzlement and holds that
one officer of Il corporation is not gull
ty of a crime in the misappropriat1on
of money by the corporation or by sub
oldinates is considered by Senator
Carney, who argued the appeal, one
of the most notable decisions that ha
come from the Iowa supreme court H.
recent years. The case was tried, but
lost on new theory of the law tha,
the course of corporation business was
such that if money sent to pay OF
notes was misappropriated the presi-
dent, by virtue of his position, woul
be criminally liable because of having
established the system of business con
llucted by the corporation, altho he
might have had no knowledge of the
receipt of the sums specified.
Justice McClain rendered the opin
ion. The following are extracts fron
the lengthy opinion filed:
After giving statement of facts in
apply on notes which the Rhoades-
Carmean Company had negotiated to
Mr.. Meickley, and further stating thai
the draft came into the hands of the
clerks of the company in the transac-
ton of their usual business, but as
the notes We're not in the possession
of the company, they We're not imme-
diately taken up. and afterwards the
company went into bankruptcy, the
opinion states:
ut is not claimed that the money
which defendant is charged to have
embezzled was entrusted to him per
sonally by Roemer & Miller or came
into his hands, nor that he had any
personal knowledge Of it's receipt, nor
that he made any direction as to it's
disposition, nor that he derived any
personal benefit from it's misappropri-
alton Indeed, it is fully conceded that
except as defendant may be charge
able with the general conduct of the
business of the company, he is i'm no
way liable, civilly or criminally, for
the failure to apply this sum of S3S5.5O
to the payment of notes in Meickley's
hands We come, therefore, directly
to the question whether defendant can
be held criminally accountable for the
failure of the clerks and servants OF
the company to apply this sum OF
money in the satisfaction of the notes
which it was sent to pay"
The court then quotes the statute,
Sec. 4S42 upon embezzlement, and
states:
"The plain purpose of the statute is
to punish those who in a fiduciary re-
lation receive and fraudulently con-
vert money or property entrusted to
them, or which comes into their hands
by virtue of such relationship. The
crime of ENLIGHTENMENT, as generally
defined by the statutes consists essen
TALLY of the fraudulent conversion or
Misrepresentation of property received
in fiduciary capacity
A number of authorities are then
given to sustain that proposition.
"ro a third person who entrusts his
money to q corporation, an OFFICER OF
the corporation is evidently not la
BILE civilly or criminally unless by some
act or neglect on his part the money
ia lost or misappropriated; and i'm view
Of the concession defendant did not
thru any personal act of his, mlsap-
propriate or cause the misappropria-
ton of the particular sum of money
entrusted to the Company for the pay
ment Of the notes above referred to,
we are led to the inquiry: what act
or omission of defendant with feIef-
ence to this money. was criminal!
"In order that defendant shall De
held liable for so planning and con-
Quoting the business Of the company
as to result in fraudulent misappro-
priation or conversion of the money OF
Roemer & Miller entrusted to the cor
poration, it must we think, be charg-
ed and shown that such course OF busl-
ness was either in it's essential char
acteristics illegal. and devised and car
ried on for the purpose Of effecting
criminal result or that with the know
ledge and under the direction OF de-
PENDANT it was so carried on in par
ticular case as to effect such result
IT seems to us that the Indictment does
not in any of these respects allege the
facts necessary to fix criminal liability
upon the defendant. And the proof is
no stronger than the Indictment. There
is in this record no evidence OF any
intention on the part Of the defendant