United States v. Samuel Bronston , 453 F.2d 555 ( 1972 )

OAKES, Circuit Judge:

Appellant Samuel Bronston was convicted on February 2, 1971, by a jury in the United States District Court for the Southern District of New York, Judge Charles H. Tenney presiding, on one count of perjury in violation of 18 U.S. C. § 1621¹ which arose from his allegedly false testimony before a referee in an 11 U.S.C. § 44(a) bankruptcy examination. Judge Tenney, in a thorough memorandum opinion dated April 15, 1971, 326 F.Supp. 469, denied appellant’s motion for acquittal or, alternatively, a new trial, and on April 21, 1971, sentenced him to six months’ probation and a $2,000 fine. We affirm the conviction.

Appellant was the president and sole owner of Samuel Bronston Productions, Inc., which between 1958 and 1964, by itself or through seventeen affiliated companies, produced a large number of motion picture spectaculars, including “El Cid,” “Circus World” and “The Fall of the Roman Empire.” With business offices scattered throughout the world, and with investment per movie as high as $17 million, the Bronston companies had accounts in numerous banks in several countries; in 1962, for instance, there were 37 accounts in five countries. As president of the principal company bearing his name, Bronston personally supervised virtually all of the transactions involving each of those accounts.

In June 1964, following the withdrawal of support by a principal financier earlier in the year, Samuel Bronston Productions, Inc., petitioned for an arrangement with its creditors pursuant to Chapter XI of the Bankruptcy Act, 11 U.S.C. § 701 et seq. A Section 21(a) hearing was held on June 10, 1966, before an appointed referee, to determine the existence and location of the company’s assets for the benefit of its creditors.

Samuel Bronston, while under oath at the hearing, responded as follows to questions regarding bank accounts in Switzerland:

Q. Do you have any bank accounts in Swiss banks, Mr. Bronston? A. No, sir.

Q. Have you ever? A. The company had an account there for about six months, in Zurich.

Q. Have you any nominees who have bank accounts in Swiss banks? A. No, sir.

Q. Have you ever? A. No, sir.

It was this colloquy which formed the basis of the Government’s perjury charge against appellant. At the trial the Government produced two witnesses who testified and introduced documents showing that in October 1959 Bronston had opened an account in his own name at the International Credit Bank in Geneva, Switzerland. Under Swiss law, the account was secret, although it was not a numbered account. The account was active from its opening until 1962, when it became dormant; it was closed in 1964. During its period of activity, checks drawn on the account totalled over $100,000; some of the transfers from the account were made to Samuel Bronston Productions, Inc.

Appellant did not testify at his trial, and the thrust of his witnesses’ testimony was that the account was no secret, since in 1965 Bronston had executed a waiver of secrecy for the benefit of all creditors in respect to all Swiss banks. Nevertheless, while it was never disputed that Bronston’s company had had an account in Zurich for six months, the Government proved to the satisfaction of the jury that Bronston intentionally had not told the whole truth at the hearing regarding his Swiss bank accounts.

The questions posed by this appeal are whether an answer under oath, which is true — but only half true — can constitute perjury under 18 U.S.C. § 1621; and whether the evidence against Bronston is sufficient to sustain his conviction. Materiality has been conceded.

Bronston’s principal arguments center on the question asked him, which was the basis of the indictment, “Have you ever [had any bank accounts in Swiss banks] ?” First, he contends that the word “you” made the question ambiguous so that he could not understand whether the question referred to him personally or to his companies; he urges that a question of such imprecision cannot support a conviction for perjury. Second, appellant argues that, whether or not the question was ambiguous, the Government failed to prove that he remembered the account at the time of the examination, and since his response regarding the Zurich account was true, there was not a sufficient evidentiary basis for the jury’s finding that Bron-ston intentionally had given false testimony in the bankruptcy proceeding.

A crucial element of the crime of perjury is the belief of the defendant concerning the verity of his sworn testimony. United States v. Winter, 348 F.2d 204, 210 (2d Cir.), cert, denied, 382 U.S. 955, 86 S.Ct. 429, 15 L.Ed.2d 360 (1965). In order to support a perjury conviction, the question asked must be of such clarity that it is capable of eliciting an answer which the defendant knows to be false; that is, it must adequately test the defendant’s belief in the truthfulness of his answer. United States v. Wall, 371 F.2d 398, 400 (6th Cir. 1967). Accordingly, a defendant may not lawfully be convicted of perjury where, under oath, he gives an answer which is “literally accurate, technically responsive, or legally truthful.” Blumenfeld v. United States, 306 F.2d 892, 897 (8th Cir. 1962); Smith v. United States, 169 F.2d 118, 121 (6th Cir. 1948); Hart v. United States, 131 F.2d 59, 61 (9th Cir. 1942); United States v. Slutzky, 79 F.2d 504, 505 (3rd Cir. 1935); Galanos v. United States, 49 F.2d 898, 899 (6th Cir. 1931).

Here, Bronston would have us rule that the question upon which his conviction is predicated was misleading, imprecise and suggestive of various interpretations, thus making it incapable of supporting the conviction. To the contrary, we believe that the question was readily susceptible of a responsive reply and that it adequately tested the defendant’s belief in the veracity of his answer.

The principal question was preceded by the question, “Do you have any bank accounts in Swiss banks, Mr. Bron-ston?” The “you” in “Have you ever?” could in the singular refer only to Mr. Bronston, or in the plural to Mr. Bronston personally and the company, there being no plausible suggestion that in the next question the examiner had shifted from inquiring about Bronston’s personal accounts to those solely of his company. By answering in reference to “the company” Bronston indicated his understanding that “you” included, or meant only, the personal you; otherwise, he would not have distinguished his answer by prefacing it with “the company.”

Thus, this is not the Wall² case, where the question was “susceptible of two different interpretations,” under one of which the answer might have been truthful. Nor is it the Galanos ³ ease, where the question was precise and the answer similarly precise, literally true and wholly responsive to the exact inquiry. Here the question unambiguously asked Bronston simply to state whether he had ever had a Swiss bank account. Yet Bronston answered that “[t]he company” , had had an account in Zurich for six months. While that much of the answer was literally true, the jury was entitled to find that the an-. swer as given was intended to represent that Bronston personally did not have such an account.

Bronston contends, however, that the truth in the half-truth response takes his answer out of the realm of perjury, citing United States v. Slutzky, supra, and United States v. Cobert, 227 F.Supp. 915 (S.D.Cal.1964). But under analysis, those cases do not aid him.

In Slutzky the defendant was asked whether he had ever been convicted of a felony in a certain jurisdiction. His answer was a truthful and responsive “no,” since in that jurisdiction there was no classification of crimes into felonies and misdemeanors. Cobert is also unlike the present case, for there a defendant was charged with perjury for answering a question relative to a “listing post” when it did not appear from common knowledge or in the indictment that he understood the phrase “listing post.” The questions posed to Bronston, however, were too plain to be construed as referring solely to the company; his nonresponsive answer very clearly indicated his comprehension of what was called for by the question.

For the purposes of 18 U.S.C. § 1621, an answer containing half of the truth which also constitutes a lie by negative implication, when the answer is intentionally given in place of the responsive answer called for by a proper question, is perjury. See, e. g., United States v. Rao, 394 F.2d 354, 356-357 (2d Cir.), cert, denied, 393 U.S. 845, 89 S.Ct. 129, 21 L.Ed.2d 116 (1968). This must be so especially in the context of a Section 21(a) examination, which by its nature is a searching expedition, where the witnesses are the only parties who know the truth and are able to divulge it. “The general purpose of the statute [11 U.S.C. § 44(a)] is to provide a method for a searching inquiry into the condition of the estate of the bankrupt, to assist in discovering and collecting the assets, and to develop facts and circumstances which bear upon the question of discharge.” Travis v. United States, 123 F.2d 268, 271 (10th Cir. 1941); see Cameron v. United States, 231 U.S. 710, 717, 34 S.Ct. 244, 58 L.Ed. 448 (1914); Sigman v. United States, 320 F.2d 176, 177-178 (9th Cir. 1963), cert denied, 375 U.S. 967, 84 S.Ct. 485, 11 L.Ed.2d 415 (1964). A half-truth containing a lie, interjected by a knowledgeable and interested witness, may result in side-tracking the person inquiring into the existence of assets known only to the bankrupt. Or it may persuade the interrogator to proceed on another line of questioning. See United States v. Stone, 429 F.2d 138, 140-141 (2d Cir. 1970). Either consequence is contrary to the “whole truth” principle of the oath.⁴ The question here was not from out of the blue or on a collateral matter. The Section 21(a) examination was for the very purpose— known to appellant — of eliciting the kind of information this question called for.

Since we cannot say as a matter of law that Bronston’s half-truth answer to the question asked will not support his conviction, his appeal must fail unless we find a lack of evidence to support the jury’s determination of guilt. Upon review, the evidence must be viewed in the light most favorable to the Government, and all permissible inferences will be drawn in its favor.

Appellant claims that there was an insufficient showing that he remembered his personal Swiss bank account and intentionally neglected to disclose it. Specifically, he argues that the account was dormant for four years before the question and was closed two years before, that it was only a small part of a large stream of widespread banking activity, and that in 1965 his creditors had received a waiver of bank secrecy which would have permitted them to locate the International Credit Bank account, so that, in effect, that account was no secret. The Government presented contradictory or qualifying evidence in reply.⁵

In short, the jury was presented with conflicting facts relative to Bronston’s state of mind at the time he answered the bank account questions. While the defendant’s. knowledge of the falsity of his statements at the time he gave them is essential to a perjury conviction under 18 U.S.C. § 1621, United States v. Sweig, 441 F.2d 114, 117 (2d Cir.), cert, denied, 403 U.S. 932, 91 S.Ct. 2256, 29 L.Ed.2d 711 (1971); United States v. Stone, 429 F.2d 138, 140 (2d Cir. 1970); La Placa v. United States, 354 F.2d 56, 58 (1st Cir. 1965), cert, denied, 383 U.S. 927, 86 S.Ct. 932, 15 L.Ed.2d 846 (1966), absent an admission by the defendant, the only way that his knowledge can be determined is through circumstantial evidence. American Communications Ass’n, CIO v. Douds, 339 U.S. 382, 411, 70 S.Ct. 674, 94 L.Ed. 925 (1950); United States v. Sweig, supra. The kinds of circumstantial evidence which the jury properly may consider as reflecting the defendant’s state of mind at the time of allegedly perjurious testimony are proof of the objective falsity itself, proof of a motive to lie, and other facts showing that the defendant knew more than he stated. See United States v. Sweig, supra; United States v. Rao, supra; United States v. Jones, 374 F.2d 414, 419 (2d Cir.), cert, denied, 389 U.S. 835, 88 S.Ct. 40, 19 L.Ed.2d 95 (1967).

Here the jury could have inferred that Bronston willfully gave false and evasive testimony from the conclusive proof of the existence of his personal Geneva bank account; from the motive that the principal officer and owner of a debtor corporation might want to conceal assets from the corporation’s creditors; and from the unlikelihood that a businessman would forget a bank account that had the duration of this account, a $100,000-plus volume of transactions in it, and was of a secret nature. Thus, there having been sufficient evidence upon which the jury could have established guilt beyond a reasonable doubt, we affirm the conviction.

1 . 18 U.S.C. § 1621 reads in pertinent part: Whoever, having taken an oath before a competent tribunal officer, or person, in any case in which a law of the United States authorizes an oath to be administered, that he will testify . truly, . . . willfully and contrary to such oath states . . . any material matter which he does not believe to be true, is guilty of perjury.

Mr. Bronston was acquitted by the jury of the second of the two perjury counts charged against him.

2 . United States v. Wall, 371 F.2d 398, 400 (6th Cir. 1967). There the basis of the conviction was the defendant’s response to the question, “Have you ever been on trips with Mr. X?” On defendant’s motion for a bill of particulars the Assistant United States Attorney acknowledged that “on a trip” “can mean either one of two things: That a person accompanied somebody else travelling with, or it can mean that they were there at a particular place with, a person.” The difference between 'Wall and Bronston’s interpretation of “you” is apparent.

3 . Galanos v. United States, 49 F.2d 898 (6th Cir. 1931). There the defendant responded truthfully to a question which was ultimately, from the Government’s angle, so precise as to be imprecise. When asked whether “you [had] made arrangements yourself,” defendant replied negatively. In fact, an accomplice had made the arrangements. The Sixth Circuit overturned defendant’s conviction for perjury, reciting the following language which appellant would have us apply to his situation:

. . . [H]is negative answer was literally true. Clearly he cannot be convicted of perjury merely because his literally accurate answer might have been somewhat modified in effect if he had been asked to state all the circumstances. Perhaps, if he had been asked specifically, he would have answered truly. 49 F.2d at 899.

Here, had further testimony as to the company’s account been elicited, the creditors would still have been in the dark about Bronston’s personal account.

4 . The Bankruptcy Act and the orders thereunder do not specify a particular form of oath to be administered in bankruptcy proceedings, compare 11 U.S.C. § 43, 44; Bankruptcy Gen.Order 22, 28 U.S.C. Under Gen.Order 22, the Federal Rules of Civil Procedure — insofar as they are not inconsistent with the Act and orders — govern the examination of witnesses, but the Federal Rules themselves do not contain the form of a designated oath. The forms used in bankruptcy procedures, however, speak in terms of truth according to the person’s best knowledge [Bankruptcy Form 1, 28 U.S.C.] or truth and completeness to the best of his knowledge [Bankruptcy Form 3, 28 U.S.C.]. It may be deduced from these orders and forms and the purpose of the Act that an oath given in a bankruptcy proceeding basically takes the same form, and has the same legal consequences, as an oath composed of the traditional words of “truth, the whole truth, and nothing but the truth.” See 6 J. Wigmore, Evidence § 1818 (3d ed. 1940).

5 . The jury could have been more impressed by the facts that the purported waiver of bank secrecy referred to all banks in Switzerland and listed seventeen company names under which an account could have been opened (creating the proverbial needle-in-the-haystack situation) ; and that one of Bronston’s own corporate officers, who had prepared appellant’s tax returns for several years in the early 1960’s, testified on cross-examination to the effect that he did not know about the Geneva account at the time it was active.