State v. Simmons

January 24, 1947. I concur in that portion of the opinion of Mr. Justice Fishburne in which he overrules the exceptions of the appellant relating to the sufficiency of the indictments, the admission in evidence of the forged notes and mortgages, and the admission in evidence of the testimony of R.C. Adair, the cashier of the Bank alleged to have been defrauded, as to the contents of certain claim and delivery papers; but I feel impelled to dissent to that portion of his opinion which finds no error in the remarks made by the trial Judge during the trial of the case and the rulings made on the admissibility of proffered testimony. It appears to me that the appellant did not receive the fair trial guaranteed to him by our State Constitution.

The indictments charged that the appellant forged certain notes and mortgages with intent to defraud M.S. Bailey Sons, Bankers, a partnership. This partnership was composed of W.J. Bailey and the heirs of M.S. Bailey. W.J. Bailey was the "President" or manager of the Bank, and controlled its affairs.

Prior to entering upon a discussion of the exceptions which the opinion of Mr. Justice Fishburne overrules and to which I do not assent, it is well that a few facts, some of which are additional to those related in his opinion, should be stated. Mr. Adair was instructed by Mr. W.J. Bailey to handle any papers presented by the appellant, and time after time, paid out money on the mere written orders or instructions of the appellant, carrying these written orders on a separate file from appellant's bank account as cash items, a great number of which transactions were never entered upon the books of the bank. We quote from the record: "Q. The practice of the bank was when an order came in, your orders were to cash it regardless of what it was or for whom it was, and when such orders came in they were put on one of these little sharp files; that is what you mean by the ``cash file', isn't it? A. That's right." Mr. Adair admitted that for several years the appellant acted with more authority in the bank than anybody other than W.J. Bailey; and that when a bank examiner objected to the appellant's line of credit at the bank, W.J. Bailey placed $60,000.00 of the Clinton Cotton Mill's money, of which Mill he was President, with the bank to take care of any loans to the appellant. Some of appellant's checks didn't pass through the regular channels of the bank, but were placed on the "file" above referred to under instructions from the appellant. Warrants were not issued for the appellant until five months after even Mr. Adair, the cashier of the bank, knew that the notes and mortgages were fictitious and forgeries, and then thereafter notes and mortgages which were genuine were turned over to the appellant by this bank for collection. The testimony further indicates that a Mr. Watson, the teller in the bank, was much better informed as to what was goin on therein than was Mr. Adair, the cashier, and was aware of the fact that a great number of the notes and mortgages placed in the bank by the appellant were fictitious and forged instruments. The majority of the funds paid out by the bank for these forged papers were used to take up orders and checks of the appellant which had been placed on the "file".

The fact that the prosecuting bank at one time prepared (and probably filed) a claim against a bonding company for the alleged default of the appellant as an employee of the bank is more or less corroborative of his testimony of his fantastic connection with W.J. Bailey and the partnership bank.

The defense of the appellant was not that the instruments in question were not forged, but that he forged them under the instructions of W.J. Bailey, the dominating partner in the banking partnership and the manager thereof, for the purpose of satisfying the bank examiner; and that all of his transactions were for the benefit of W.J. Bailey, he (the appellant) merely drawing a weekly salary. In other words, that the business conducted in the name of H.W. Simmons was in fact that of W.J. Bailey.

Article 5, Section 26, of the Constitution provides: "Judges shall not charge juries in respect to matters of fact, but shall declare the law".

Interpreting this section of the Constitution this Court has held that a trial Judge cannot convey to the jury, either expressly or impliedly, his opinion of the force and effect of testimony upon any question of fact at issue. State v. Pruitt, 187 S.C. 58; 196 S.E. 371. And it has been frequently held that a trial Judge should not by remarks in ruling upon testimony offered, indicate opinions or express views reasonably calculated to influence the jury in deciding a material issue of fact. Powers v. Rawles,119 S.C. 134; 112 S.E. 78. State v. Bagwell, 201 S.C. 387;23 S.E.2d 244.

Under the common law, and under the accepted law of this State, a copartner in a business cannot be convicted for defrauding the partnership. State v. Grumbles,100 S.C. 238; 84 S.E. 783. It may be that there is no sound reason for this principle of law, but it has existed for time immemorial, and I see no reason in the instant case for ignoring or modifying such principle of law.

It is well established that in the proof or disproof of fraud, the inquiry assumes a wide range and the rules of evidence are not so strictly enforced as in other cases. Border State Lumber Co. v. Edwards et al., 103 S.C. 391;88 S.E. 537.

The foregoing briefly but reasonably covers the law applicable to the exceptions to be discussed. If the appellant was acting merely as the agent of W.J. Bailey, and under his instructions, and if a conviction against Bailey could not be had, then a conviction of the appellant is improper. It was a factitious issue in the case whether the appellant was acting as the agent of W.J. Bailey and under his instructions in forging the notes and mortgages in question, all of which were made payable direct to the partnership bank, and did not even carry the endorsement of the appellant.

Proceeding in an orderly way in an effort to establish his defense, the appellant introduced in evidence a letter he had written to W.J. Bailey addressed to Hot Springs, Arkansas, dated April 24, 1943, which tended to show that he had turned into the partnership bank on one occasion the sum of $300.00, and on another occasion the sum of $613.29, both of which were for the benefit of W.J. Bailey. When this letter was admitted in evidence, and which in our opinion was material to the defense of the appellant, the trial Judge remarked: "It is perfectly harmless". Such remark coming from the Court could easily have led the jury to conclude that no weight was to be attached to this evidence, and amounted to an expression of the trial Judge's opinion that the evidence was worthless.

Again when the appellant was undertaking to elicit from the cashier of the bank the information that Mr. Bailey and the appellant had become unfriendly and that the appellant had stopped coming to the bank and to Bailey's office therein, the trial Judge remarked: "It is not important anyway". The importance of this testimony became evident in the light of the testimony of the appellant later in the trial of the case. (We refrain from going into detail as to the testimony of the appellant for the reason that a new trial may be granted to him.)

We also consider that it was vital to the appellant's defense that he be allowed to show that he was using money received from the bank to purchase looneys for W.J. Bailey, and the trial Judge's refusal to admit such testimony, under the defense here interposed, was error, which was accentuated by his remarks in ruling thereon, and as follows: "I have got to limit this somewhere, and I rule now that all reference to looneys be stricken from the record and neither can that matter be argued to the jury and cannot be referred to. It has nothing to do with the charge of forgery as charged in this indictment, and it can't have anything to do with this case except to bring about confusion, just confuse the issue, and so now that Mr. Simmons got that off his chest, he told you what it was all about, now strike it from the record".

The same observation applies to the appellant's activities in purchasing Government bonds for W.J. Bailey, some of which were purchased, it was testified to, with the proceeds of the forged instruments, and the refusal of the trial Judge to permit the appellant to go fully into this matter.

We think it unnecessary to refer to the other exceptions. While the fictitious nature of the papers involved is admitted, yet the intent to defraud must be present before a crime is committed.

Of course, it may be that the business was that of Simmons alone, but in view of the peculiar circumstances of this case, greater latitude should have been allowed the appellant in going into the nature of his transactions with W.J. Bailey, and the trial Judge, in my opinion, erred in limiting the appellant in his testimony as he did, and in characterizing some of the proffered testimony as "side issues" and "smoke screens".

For the reasons above stated, and with a majority of the Court concurring, a new trial is granted.

MESSRS. ASSOCIATE JUSTICE TAYLOR and OXNER concur.