People v. Montgomery — 28 N.Y. Crim. 110

Majority

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SUPREME COURT—APP. DIVISION—FIRST DEPT.,

July 11, 1912.

THE PEOPLE v. WILLIAM R. MONTGOMERY.

(152 App. Div. 1.)

Headnote

Grand larceny—Embezzlement of bank funds—Evidence. '

Appeal from a judgment convicting the defendant of grand larceny in the first degree in that, being president of a bank, and having knowledge of its impending failure, he feloniously appropriated its funds to his own use, etc. Evidence examined, and held, sufficient .to justify a finding of fraudulent intent, and that the judgment of conviction should be affirmed.

Appeal by the defendant, William R. Montgomery, from a judgment of the Court of General Sessions of the Peace in and for the county of New York, rendered against the defendant on the 21st day of February, 1911, convicting him of grand larceny in the first degree, and also from an order denying the defendant’s motion for a new trial.

James W. Osborne, for the appellant.

Robert 8. Johnstone, for the respondent.

The appellant was charged, by an indictment comprising three counts, with the larceny of the sum of $4',400, property of the Hamilton Bank, of which he was at the time the president. The case was sent to the jury upon only one count, that charging the offense formerly known as embezzlement, now known as larceny, the substance of the count being that said appellant, being an officer of the bank having in his possession, custody and control funds of the bank, feloniously appropriated

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the same to his own use with intent to deprive and defraud the corporation thereof, and of the use and benefit thereof and the same did then and there feloniously steal.

On October 23, 1907, the Hamilton Bank, of which the appellant had long been vice-president and for a short time president, was in such financial straits that it was about to close its doors, as the appellant well knew. In fact it did close on the next day. At a late hour in the afternoon defendant obtained through the agency of a man named Gross from the Tremont branch of the bank the sum of $4,400. This sum was paid out by the manager of the branch, after banking hours, and after a telephone conversation with appellant, upon the presentation and discount of a note signed by one George Cromer and indorsed by the Hinford Realty Company, which note had been given by appellant to Gross, with instructions to have it discounted at the aforesaid branch bank. That the money was thus obtained, and that it was paid over by Gross to appellant, and received by the latter on the evening of the same day, is not denied. The evidence was such that the jury were amply justified in finding that the appellant caused the money to be withdrawn from the bank, and took possession of it with the purpose and intent of appropriating it to his own uses, and that he did in fact so appropriate it. Indeed it was specifically conceded upon the trial by his counsel (the defendant himself did not testify) that the appellant “ got. that money, personally, for his own use.” The defense mainly relied upon was that the defendant, in so taking the money, was guilty of no felonious intent because the bank was amply protected, or he believed in good faith that it was amply protected, by a mortgage of the Minford Realty 'Company upon certain .real estate of which appellant had once been a part owner. ■ The real estate consisted of a number of lots at Hnionport on the Westchester creek. Appellant and a man named Knauf had purchased the property in the year 1906 for $21,250, of which $15,250 remained on

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mortgage, the appellant contributing in cash $1,500, and Knauf $4,500. Title was taken in the name of Knauf’s wife. In August, 1906, through appellant’s efforts the property was sold to a man named Sill, at the price' of $31,250 which was paid as follows: The $15,250 mortgage above mentioned remained, and Sill executed two mortgages for $7,875, each one of which was given to Mr. Knauf, and the other to a gentleman who acted as attorney for appellant. Sill also gave appellant his note for $250. Both these mortgages for $7,875 each were afterwards assigned to the bank, but it was shown and conceded upon the trial that they formed no part of the security for the note upon which appellant received the $4,400' he is accused of embezzling. Thus the mortgages, ahead of any security for the $4,400 note aggregated $31,000. Later, at the suggestion of appellant, Sill organized the Minford Realty Company and conveyed the Unionport lots to it, subject to the aforesaid mortgages. Sometime before the failure of the bank, appellant informed Sill that he wished to raise $15,000' to $18,000 to enable him to buy stock enough to control the bank, and asked for Sill’s assistance. He requested Sill to cause the Minford Realty Company „ to execute a mortgage for $20,000 to bé given to the bank. This would make the total incumbrance upon the property $51,000. Sill apparently protested that this was more than the property was worth, but appellant said he would carry it through all right. Sill also, at appellant’s request, gave him a number of blank notes and checks made by the realty company. It appeared from the books of the bank that notes of the realty company aggregating $13,525 had been discounted by the bank before the discount of the note upon which appellant received the $4,400 and were then held by the bank. What became of the proceeds of these notes does not appear, except that neither Sill nor the realty company seem to have received any of it. The mortgage for$20,000 was made on August 16, 1907, and transferred to the bank on August 17,' Í907, the discounts of the

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realty company’s notes being made soon afterwards. The two notes for $7,875 each were transferred to the bank in October and November, 1906. At about that time the manager of the Tremont branch entered upon the books, at appellant’s direction, a memorandum that the property mortgaged was of the value of $40,000 subject to a prior mortgage of $15,000. Soon after the $20,000 mortgage was assigned to the bank the same manager, at appellant’s direction, made an entry to the effect that the property mortgaged was worth $75,000, subject to prior mortgages aggregating $31,000. What the real value of the property was is problematical. Expert witnesses were called by both the prosecution and the defense and as usual differed widely in their estimates, the most optimistic placing the value only slightly higher than the mortgages placed upon it. Others estimated it at a much lower figure.

Thus it appears that on October 23, 1907, when the bank of which he was president stood on the verge of imminent failure, he took from its funds the sum of $4,400 for his own purposes, not upon his own credit, but upon the note of the Minford Realty Company, secured by a mortgage of $20,000' on property already incumbered to the extent of nearly $45,000, which he had bought in 1906 for-$21,250, and which he had valued on the books of the bank in October and November, 1906, at only $10,000. At the best the jury could scarcely have found that defendant could have entertained more than a hope that the security would ultimately prove sufficient to reimburse the bank. As was said by the Court of Appeals in People v. Meadows ( 199 N. Y. 1 , 7, 24 N. Y. Crim. 461 ): “ A deliberate diversion of the moneys being shown, it required but slight evidence in the facts and circumstances to satisfy the jurors as to the existence of the felonious or criminal intent. His expectation or intention of restoring the moneys so diverted, of course, was of no avail.” In point of fact theré is no evidence that appellant

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ever entertained the intention of himself repaying the bank. His sole reliance was that it would be paid out of the proceeds of property belonging to someone else.

The defendant insists that he was not guilty of embezzlement because no demand was made of him to restore the moneys, and because he made no denial of its receipt, gave no false account or statement concerning it and caused no false entry relating to it to be put in the books. All those circumstances, when they are shown to exist, do not in fact constitute any component part or-element of the offense. They are merely facts and circumstances admissible in evidence as bearing upon the question of a fraudulent intent (Commonwealth v. Tuckerman, 76 Mass. 173 ), but they are by no means the only competent evidence of such an intent. Other grounds are advanced why the result of the trial should be set aside, but they seem to require no extended comment. The appellant was treated with all proper consideration by the court, and if-errors in the admission or rejection of evidence are to be discovered in the record they were invariably favorable rather than prejudicial to the appellant. The only serious question in the case was whether or not the appellant when he took the money of the bank for his own purposes did so with a felonious intent. That was purely a question of fact for the determination of the jury, and was fairly submitted to them. Upon the uncontradicted evidence an intelligent jury could scarcely have arrived at a different result from that at which the jury did arrive.

The judgment and order should be affirmed.

Ingraham, P. J., McLaughlin, Milleb. and Dowling, JJ., concurred.

Judgment and Order affirmed-

Cases cited

People v. Meadows 24 N. Y. Crim. 461 N.Y. 1910-06-07 p. 113