Court Opinion

ID: 9696070
Source: CourtListenerOpinion
Date Created: 2023-08-25 18:34:56.667216+00
Date Added: 2024-06-11T18:20:18.145639
License: Public Domain

*69Dissenting Opinion by
Mr. Justice Musmanno:
There is no statute on our books which says that what George Bovaird did was a crime. In affirming the conviction in this case, the majority of this Court has taken an unprecedented, and, in my opinion, an unwarranted step. The majority opinion quotes Section 834 of the Criminal Code and italicizes certain words as follows: “Whoever, having received or having possession, in any capacity or by any means or manner, of any money or property, of any kind whatsoever, — ” But the italicization should have gone further — “of or belonging to any other person. . .”
Who is the other person? The indictment mentions Carter and Company. If Carter & Company were a corporation and as such an artificial person apart from the persons who owned the stock, the indictment would be valid, but Carter & Company is not a corporation or another person: It is a cotenancy, and a cotenancy is not separable from the members who compose it. Our law books are filled with statements to the effect that a co-tenant is a co-owner of all the property which is the subject of the co-tenancy.
The majority opinion says: “It is argued by the appellant that as a cotenant of Carter & Company he could not fraudulently convert or embezzle property of the cotenancy in all of which he had an undivided part ownership. Much of the argument in this connection relies on the theory of the law of cotenancy as applied to real property in the civil law. The criminal law is not controlled by the civil law. . . A private wrong when made a criminal offense becomes a public wrong.” But the majority fails to note that reference must be made to the civil law in order to ascertain what interest the defendant had in the proceeds of the co-tenancy and thus determine whether a crime was committed when he accepted part of those proceeds. *70It is true that a private wrong when made a criminal offense becomes a public wrong, but there has been no adjudication that what Bovaird did was a private wrong, but, assuming, arguendo, that it was, no criminal statute has made that private wrong a crime. .
Instead of treating the civil law as of little' consequence in this cáse, we are compelled to go' to the civil law absolutely and primarily to establish the rights of the parties. One cannot steal from oneself, so that if Bovaird was entitled in law to draw from the co-tenancy assets, no crime has been committed. That is fundamental. .
An examination of the civil law on the subject discloses eo limine that the “relationship of tenancy in common does not create, even by implication, the relation of principal and agent, and does not, of itself, make the cotenants partners”; 62 C.J. 419, Sec. 22; Caveny v. Curtis, et al., 257 Pa. 575-580, 101 A. 853.
The majority opinion goes on to say that: “The defendant’s status, therefore, was not merely that of a tenant in common as the relationship ordinarily arises by operation of law. . . Under it (the agreement) he became á co-owner but he primarily became the agent for the other co-owners. . . It was by virtue solely of his employment as agent and not by reason of his right as a cotenant that he came into possession of the monies which he was charged with- converting or embezzling. He had no immediate right of possession as cotenant to these monies received qua agent.” Here the majority would ignore the defendant’s status as co-owner. As a cotenant of Carter & Company and therefore in possession of all of its property, George Bovaird was a principal, not an agent. As he was a cotenant and therefore owner of an undivided interest in the. entire property he could not be an agent for himself. He could not be principal and agent at the same time;
*71The only description of the defendant as agent in the cotenancy agreement is that oil runs were to be credited in the pipe line to George Boyaird, Jr., as agent. The agreement did not provide that oil which would be produced from the lease operated by the co-tenancy should be delivered into the pipe lines to the separate account of each of the cotenants, but rather it was to be delivered in the pipe lines to the credit of the cotenancy, and as someone necessarily was required to receive and receipt for the production, George Boyaird, Jr. was designated as agent. But that does not mean that his conduct of the business was not in the capacity of a co-tenant. The oil in the pipe lines, converted into cash and placed in the bank account of Carter & Company as provided in the agreement, was as much the property of the cotenancy as the'Original leaseholds.
Mills on “Law of Oil and Gas” page 263, sec. 175, Mills states: “Tenants in common of land who have executed a joint lease thereon are tenants in common in the royalty.”
Since the defendant therefore was not a mere agent he could not be held guilty of embezzlement under Section 824 of the Act of 1939, 18 P.S. 4824.
Nor could the defendant be held guilty of fraudulent conversion of the tenancy property because the rule is hoary with age that each tenant has an equal right to the possession of the whole. That rule is stated in 62 C.J., sec. 30, p. 423, as follows: “A tenant in common has an interest in the possession of every part of the property, and from the nature of the estate must necessarily be in possession of the whole and has the right to occupy the whole of the common property and every part thereof, and cannot be ejected for occupying more than what would be his share of the premises on partition; nor can the rights to possession *72of the premises, which all tenants in common of the property are entitled to as between themselves, be affected by the acts of one dispossessing another by force or fraud.” Thus it can be seen that the co-tenant’s right to the possession of the entire subject matter of the cotenancy is so strong and lasting that even where he takes possession of more than his proportionate share of the property he cannot be evicted therefrom. Nor was he, under the common law, liable for any rent for such use and occupation of more than his share. See Kline v. Jacobs, 68 Pa. 57, where this Court said: “But neither at common law nor under any statute could assumpsit for use and occupation be maintained upon the mere occupation, though it might be shown to be permissive. Each tenant has an equal right to the possession of the whole, and without an express contract to pay rent, account was the only remedy under the statute of Anne.” (Emphasis supplied.)
Section 62 of C.J., sec. 26, p. 421, declares: “Each tenant in common is equally entitled to the use, benefit, and possession of the common property, and may exercise acts of ownership in regard thereto. .
The majority opinion states that the defendant “cannot escape criminal liability by doffing the wrap of agency, a garment of his own making, and donning the cloak of cotenancy with its fictional legal attribute.”
Cotenancy is not a legal fiction. From the chambers of Sir William Blackstone, it has moved unquestioned down the stone corridors of time in all its dignity, clarity and authority. In ignoring its precise and never-heretofore-questioned attributes of wholeness and indivisibility, the majority is doffing its judicial robes and donning the raiment of a legislator. The majority here is acting as the General Assembly of the Commonwealth of Pennsylvania, which it has no right to do. *73It is creating law by judicial fiat, which is completely beyond the scope of its constitutional authority. This constitutes ex post factoism which has no place in a land of laws.
Once we depart from the unequivocal statutory mandate (Act of May 28, 1937, P. L. 1019, 46 PS Sec. 558), that criminal statutes are to be construed strictly, we have opened the door not only to loose prosecution but to vindictive persecutions. If Bovaird’s conduct was improper but the Criminal code does not cover that conduct, it is for the Legislature of the Commonwealth to supply the deficiency, not the courts. In the highly complex transactions involved in business life, business men have the right to know with precision what the criminal law is, for if non-prohibited acts can by construction become criminal acts, legitimate business will have been dealt a staggering blow. It is not right or salutary to the commercial interests of America that business men should have to operate under the shadow of a possible court interpretation which will declare their innocent acts criminal. Other states have not permitted that shadow to fall, as we shall see later.
The majority opinion seeks to distinguish the case of Commonwealth v. Mitchneck, 130 Pa. Superior Court 433, but it seeks in vain. It cannot be questioned that Mitehneck owed his employe a certain sum of money which he failed to pay to him and failed also to pay to the grocer to whom the employe owed money. Mitch-neck thus, in effect, temporarily withheld money owing to his employes, but the Court held that this did not constitute fraudulent conversion.
The principle expressed by the Superior Court in that case applies precisely to the facts at bar when it said: “The words of the statute, ‘money or property . . . which any other person, firm or corporation is entitled to receive and have’, does not refer to money owing an*74other, but to money or property the title to and ownership of which is in another; it is another form of expressing money or property belonging to another.”
In the case at bar Bovaird may owe money, but he has not fraudulently converted it under the statute.
In Com. v. Overheim, 106 Pa. Superior Ct. 424, 162 A. 475, the Superior Court said: “The Act of May 18, 1917 makes the fraudulent conversion of property a misdemeanor, but it is essential that the' property at the time of sale or conversion shall have belonged to another(Italics supplied.)
As cotenant the title of the property of Carter and Company was as much in Bovaird as it was in the names of the cotenants. In Commonwealth v. Cavanaugh, 159 Pa. Superior Ct. 113, 116, the Superior Court said: “Of course one may not be convicted of fraudulent conversion if title and ownership of the property is in him.”
In Commonwealth v. Schuster, 158 Pa. Superior Ct. 164, the Superior Court said: “The gravamen of the offense of fraudulent conversion is the withholding of the property of another with the intent to defraud that other, or to deprive him of the use and benefit of his property and to convert or apply the same to defendant’s own use or benefit as against the owner.” (Italics supplied)
Wharton’s Criminal Law, 12th Ed., Vol. 2, sec. 1162, declares at page 1479: “Where there are joint tenants or tenants in common of a personal chattel, and one of them carries away and disposes of it, this is no larceny; there is, in fact, no taking, for he is already in possession; it is merely the subject of an action of account, or bill in equity.”
It will be recalled that in the cotenancy agreement, Bovaird was given plenary power to operate the property of the cotenancy with “as full and ample authority *75and unrestricted power* as if lie were the sole owner thereof.”
The matter of agency of George Bovaird has been overstressed. He was referred to as agent only once in the agreement, as already indicated, and that for a specific purpose entirely unrelated to the question before us. He was never an agent in his relation with his brother co-tenants. They were all principals and no one was an agent to the other. And, least of all, was Bovaird an agent of Carter & Company, which, as shown, was not a corporation but a cotenancy. Bovaird was not an agent but a managing cotenant. As a co-owner of the property, Bovaird could not fraudulently convert what belonged to himself.
That the Commonwealth itself ivas not too sure of its ground in bringing this prosecution is evidenced by the fact that it returned eleven indictments against Bovaird but had to abandon four of them because the defendant was charged with fraudulent conversion of partnership property and of course, Carter & Company was no partnership. He was even indicted on the charge of embezzlement for receiving his own salary! And this indictment had to be withdrawn.
In 2 C. J. S., sec. 2(a), Page 1026, we find: “Whether as between the parties their relationship is one of agency depends on their relations as they in fact exist under the agreement or acts of the parties, and the question is not governed by the stipulations of the parties; and the parties cannot, where the relationship is in fact one of agency, change its nature by declaring that it is not an agency, nor can they, by calling their relations one of agency, make it so when it is not so in fact. Whatever the precise relationship between the parties may be, the relation of principal and agent does not exist between them in the absence of any essential element of such relationship.”
*76I regard this whole prosecution as an attempt through criminal courts to collect a civil debt, a procedure which has always been abhorred by the courts, and to which we should not grant the remotest sanction. The transactions which resulted in the indictments in this case were all done openly. There was on the part of Bovaird no clandestine withdrawal of funds, no concealing of assets. It is very clear that it was understood that any one of the co-tenants could make withdrawals because it was understood that there would be a final accounting, and the debts and credits would be adjusted at that time. For instance, in 1936 John Carter withdrew $5,000 and Mrs. Carter withdrew $2500. In 1938 Mrs. Carter was in the hospital and a check was drawn in the amount of $4000 to pay for hospital bills. Mrs. Carter received $3,000 in the nature of an advance in 1939 and then additional amounts totaling $9500. The co-tenancy employed a bookkeeper who made entries of all these withdrawals. The books were examined by the Internal Revenue Department at various times for income tax purposes. John J. Carter, one of the original co-tenants, and George Christie Bovaird, Avho inherited Mrs. Bovaird’s share in the co-tenancy, both testified that they were aware of the withdrawals made by the defendant and acquiesced in those Avithdrawals.
The tAvo indictments charging embezzlement Avere drawn under Section 824 of the Act of 1939, 18 PS 4824, which states: “Whoever, being a banker, broker, attorney, merchant or agent, and being intrusted, for safe custody, Avith the property of any other person, and, Avith intent to defraud, sells, negotiates, transfers, pledges, or in any manner converts or appropriates to or for his own use or the use of any other person, such property, or any part thereof, is guilty of embezzlement. .” But the indictments fail to assert the indispen*77sable element of intent to defraud and should have been quashed on that ground alone. These indictments, after noting that Bovaird ivas entrusted with “money, accounts and properties belonging to Carter and Company,” add “of which Beth M. Putnam was entitled to have a one-half share of interest or interest thereof,” but this specifically mentioning Mrs. Putnam does not change the nature of the co-tenancy. George Bovaird, Jr., is still an owner and still cannot be charged with embezzling from himself. George Bovaird, Jr., cannot be an agent of Mrs. Putnam. This Court said in Caveny v. Curtis, 257 Pa. 575-580, 101 A. 853: “ ‘Under ordinary circumstances neither tenant-in-common can bind the estate or person of the other by any act in relation to the common property, not previously authorized or subsequently ratified, for cotenants do not sustain the relation of jmncipal and agent to each other, nor are they partners.’ ”
In 62 C. J., 419, sec. 22, the general rule appeal's: “The respective rights of tenants in common are of a legal, and not of an equitable, nature. The relationship of tenancy in common does not create, even by implication, the relation of principal and agent, and does not, of itself, make the cotenants partners.”
The amount involved in the two indictments on embezzlement was $2,000. It was not shown at the trial that this sum was embezzled from Mrs. Putnam. And we know that Bovaird could not have embezzled from Carter & Company, because he was a proprietor entitled, with all the other co-tenants, to all the assets of the co-tenancy.
Since the defendant was neither banker, broker, attorney or agent who was entrusted with the property of any other person, he cannot be guilty of embezzlement.
*78Since the defendant had the right to possess the property in question, he was not possessing property “of or belonging to any other person” and therefore cannot be held guilty of fraudulent conversion.
In Burdick — Law of Crime, Vol. 2, Page 283, Sec. 517, we find the statement: “If the property is owned by two or more persons, such as joint-tenants or tenants in common, no one of such owners can commit larceny from the others because all of them are equally in possession.”
In State v. Kent, 22 Minn. 41, 21 Am. Rep. 764, the opinion of the Supreme Court holds: “Section 23, ch. 95, Gen. St., enacts that ‘if any officer, agent, clerk, or servant, of any incorporated company, or if any clerk, agent, or servant, of any private person, or any co-partnership, . . . embezzles, or fraudulently converts to his own use,. . . without consent of his employer or master, any money or property of another, which has come to his possession or is in his care, by virtue of such employment, he shall be deemed to have committed larceny.’
“To sustain an indictment under this section of the statute, the money or property charged to have been embezzled, or fraudulently converted, must be the money or property of another than the person indicted. The defendant was collector of pew rents for a church corporation, and acted as such, under a special and express agreement, by which, as compensation for his services, he was to have ‘five per cent, of all the pew rents, no matter who collected them.’
“The effect of this agreement was to vest in defendant an undivided one:twentieth interest in the rents-collected, and to that extent to’make him an owner of the same jointly with the corporation. In other words, the rents collected were not the money or property of the corporation, but the joint property of the corporation *79and defendant. They were, therefore, not the property of another than the defendant. It follows that the defendant is not properly indictable, under the section of the statute before cited for his alleged embezzlement and fraudulent conversion of the same, or any part thereof. Holmes’s Case, 2 Lewin, 256, cited 2 Archbold Cr. Pr. & Pl. 569, note: . . . Com. v. Stearns, 2 Met. 343, 349; Com. v. Libbey, 11 Met. 64; Com. v. Foster, 107 Mass. 221; 2 Bish. Cr. Law, §355, 356.
“This conclusion practically disposes of the case in defendant’s favor.”
McElroy v. People, 202 Ill. 473, 66 N.E. 1058, was a case under a statute similar to the statute in State v. Kent, supra. After quoting the statute, the Supreme Court of Illinois said: “By this statute, in order to constitute the crime of embezzlement the fraudulent conversion must be of the property of another. If the plaintiff had a right to deduct her commissions from the gross amount collected, then to that extent the money belonged to her, — that is, she and the company owned the gross sum jointly. The law is, that where a defendant has an interest in the property or money alleged to have been fraudulently converted to his or her own use there can be no conviction of the crime of embezzlement. (10 Am. & Eng. Ency. of Law, 985, and cases cited in note 7.)
“In the case of State v. Kusnick, 45 Ohio St. 535, [15 N.E. 481, 4 Am. St. Rep. 567,] the court said: Ht is true that at common law, to constitute larceny, the thing alleged to have been stolen must be the property of another person than the offender. It is also true that the statutes of nearly all the States which undertake to define embezzlement, require that the subject of the offense shall be shown to be property of another; and this has almost universally been construed to mean that it must be wholly the property of an*80other.” (The Court then refers at length to the ease of State v. Kent, supra)
The Court said further: “The only evidence of a criminal intent is the inference to be drawn from the act itself. She at no time denied or attempted to conceal the indebtedness.”
In this connection it will be noted that the defendant Bovaird at no time denied or concealed the indebtedness, but it is a matter of record that at all times the books of the cotenancy disclosed the indebtedness of this defendant.
In Commonwealth v. Novick, 142 N.E. 771, the Supreme Judicial Court of Massachusetts said at Page 771: “At common law it was ordinarily held that a general partner could not be convicted of larceny or embezzlement for appropriating to his own use money which came into his possession by virtue of his being such partner and joint owner, because it was not ‘the property of another.’ 31 L.R.A. (N.S.) 822, note, and cases cited; Gary v. Northwestern Mutual Aid Association, 87 Iowa, 25 53 N.W. 1086; State v. Butman, 61 N.H. 511, 60 Am. Rep. 332. See Commonwealth v. Bennett, 118 Mass. 443. As to the unauthorized conversion of the funds of benevolent and fraternal organizations by their fiscal or managing agents, see 14 Ann. Cas. 725, note. State v. Kusnick, 45 Ohio St. 535, 15 N.E. 481, 4 Am. St. Rep. 564; People v. Mahlman, 82 Cal. 585, 23 Pac. 145. It was doubtless to exclude such a defense that our Legislature enacted the Statutes 1884, c. 174, and 1886, c. 328 (now G.L. c. 266, §58, 59). By the express terms of said sections 58 and 59 an officer of a voluntary association or society who fraudulently converts its money, goods or property, which has come to his possession by virtue of his office, is made guilty of larceny, ‘although he is a member of such organization or voluntary association and, *81as such, entitled to an interest in the property thereof.”
In the Novick case it was necessary that a statute he enacted in order to exclude the defense that the accused was a joint owner, and, therefore, could not be indicted for larceny or embezzlement. It will also be noted that the statute which Illinois enacted specifically provided that an officer of a voluntary association or society who fraudulently converts its monies, etc., is made guilty of larceny “although he is a member of such organization or voluntary association and, as such, entitled to an interest in the property thereof.”
It is my earnest belief that a great injustice is being done this defendant in declaring him criminally responsible for an act which, according to the law as I see it, was not a crime when committed. But an even greater injustice is being done him by refusing a new trial on the state of the record.
The defendant desired to show at the trial that the market value of the cotenancy was over $1,000,000, but the Trial Judge refused to permit this evidence. This was grave error.
It is a simple matter of common sense that if a person is charged with stealing $100 and he can show that he possesses $100,000, this would tend to negate the element of criminal intent without which there can be no crime.
Much was made at the trial that Bovaird had withdrawn some $197,000 from the cotenancy, but he was criminally charged only with taking $9500. It would not be unreasonable to suppose that the jury, on the evidence, found Bovaird morally guilty of taking $197,-000, but if the jury had known that the value of the property was over $1,000,000, the figure of $197,000, as impressive as it is, would have been reduced, in their calculations, to a smaller comparative size.
*82The element of sympathy for the loser in financial transactions is inevitable, and I would not say that it is improper, but in a trial at law that sympathy should at least be intelligently exerted, and how can it be so exerted when the jury is deprived of knowledge of all the facts?
It was shown at' the trial that there were judgment liens against the cotenancy property in the amount of $300,000. Here again, if the defendant had been permitted to show the value of the whole property to be $1,000,000, the $300,000 debt would not have influenced the jury to the extent that it otherwise undoubtedly did.
This point was squarely ruled on by the Superior Court in the case of Commonwealth v. Hazlett, 14 Pa. Superior Ct. 352, 369, 370. There, the defendant banker was charged with embezzlement. At the trial he endeavored to show the assets of the bank at the time it closed its doors, for the purpose of repelling the charge that he knew the bank was insolvent. The Trial Court refused the offer as irrelevant. The Superior Court reversed the conviction and remanded the case for a new trial. In its opinion, the Superior Court said: “The evidence embraced in the offer which is the subject of the tenth assignment might not shed any light upon the question whether the defendant had sufficient assets at the time he received this deposit to meet and pay his liabilities in the regular course of business, as counsel for the commonwealth truly say, but we are clearly of opinion, that, if believed by the jury, it would have had a legitimate tendency to repel the inference that it was because of his Imowledge or belief that he was insolvent that he closed his bank ”
The Court said also: “Whenever the motive, intention or belief of a party charged with a crime is in issue, it is competent for such party to testify directly *83upon that point, and also to the facts and circumstances accompanying an act, which reasonably tend to repel an unfavorable inference which might be drawn from the act if unexplained.” (Emphasis supplied.)
In the case before us, the motive or intention of George Bovaird was strictly in issue. And it was certainly relevant to show, in his defense, that there could not have been any intention to deprive the other co-tenants of money due them, since the assets were excessively adequate to meet all their demands. Not only would the $1,000,000 figure discharge all obligations, but it would demonstrate that it included an amount in excess of whatever share Bovaird would be entitled to in the eventual distribution.
The failure to let the jury have this highly relevant evidence was a mortal blow to the defendant’s case because the jury could have believed, as it undoubtedly did, that Bovaird’s withdrawals represented a taking of moneys due the other cotenants, whereas, on the basis of a $1,000,000 valuation, this was not true. The jury could still have believed, with the introduction of the $1,000,000 figure that Bovaird was guilty, but the defendant would have had his complete day in court, which, under the circumstances as I view them, has now been denied him.