People v. Grout

The defendants having obtained orders allowing them to inspect the minutes of the grand jury which returned two separate indictments against them for perjury, on December 29, 1913, now move to dismiss the indictments upon the ground that the legal and competent evidence received by the grand jury was insufficient to warrant the finding of the indictments ; that there was no legal or competent evidence warranting the finding thereof; they also charge that the grand jury received other than legal and competent evidence, which improperly influenced their minds to such an extent and in such manner as to invalidate the indictments, and that the same were

The decision of these motions does not depend upon the actual guilt or innocence of the defendants. If the motions were granted it would mean that the case would be submitted to another grand jury, and a denial of the motions is not any indication that the court has an opinion one way or the other on the merits. The defendants are presumed to be innocent of the charge made against them.

I have given due consideration to the able argument of the learned counsel for the defendants and the district attorney, and have examined the very instructive briefs submitted on both sides on the motions now before the court. I have reached the conclusion that the motions must be denied. I can see no good purpose to be served, however, by a detailed statement of my views upon the many interesting questions presented by the counsel for the defendants. The testimony of the witnesses examined before the grand jury has been digested by counsel, and the defendants’ arguments and explanations must necessarily have great weight upon a trial, because in a case of this kind the intent of the defendants, the' question whether they knew that the affidavit sworn to was false, is of supreme importance. It might be conceded that the affidavit was false and yet the defendants would be" entitled to acquittal unless the prosecution proves that its falsity was known to them.

The defendants are justified in their charge that incompetent and irrelevant testimony was given before the grand jury. But that is not the question. If in addition to the irrelevant testimony there was legal evidence which made out a prima facie case, the indictments must stand. The fact that illegal evidence appears in the minutes does not avoid the indictments. This is so from the nature of the inquiry by the

In the case at bar there is no dispute that on April 2, 1910, the defendants, as president and cashier respectively of the Union Bank, verified the affidavit attached to the quarterly report furnished to the superintendent of banks under section 21 of the Banking Law. In compliance with the statute, each of the affiants made oath that the report in question was true and correct in all respects to the best of his knowledge and belief.

This report of the financial condition of the bank on March 25, 1910, showed it to be entirely solvent on that day not only with assets sufficient to pay its liabilities in full, but it was stated in the report that the bank possessed, over and above its debts and liabilities, including the amount due its depositors, resources equaling its capital stock of $1,000,000, and in addition a surplus amounting to $508,699.51, market value. As already stated, this report was sworn to on April 2, 1910. Two days later, on April 4, 1910, the bank was closed by the state banking- department. It had no surplus. The capital

The making of the report and its contents were legally proven before the grand jury, the failure of the bank and the absence of assets reported seem to be proven by competent evidence. I think that there was legal proof of the insolvency of the bank on April fourth, two days after the oath and ten days after the 25th of March, 1910, the date as to which the report was made. This is one of the specifications charged in the indictment upon which the grand jury base their charge that the affidavit of April second was false. There are a great many other details referred to in the indictment and specific charges of falsehood made concerning them. I mention this reported solvency and surplus of more than a million of dollars as one item—one distinct charge, one fact concerning which there appears to have been legal evidence adduced.

Now, of course, it does not follow because the surplus did not exist on April fourth that the same condition existed on April second or on March twenty-fifth. But it seems to me that it calls for explanation. The discrepancy is very great, the deficit runs into millions. And I have in mind that we might go further and concede that the affidavit was false, and yet the defendants might be innocent of crime. Guilty knowlege of its falsity must be brought home to the defendants beyond a reasonable doubt.

It is this highly important branch of the case that seems to me to necessitate the denial of the motions to dismiss. Because this involves the searching of the minds and conscience of the defendants, and under our system of government this must be done at a trial before a judge and jury. It is difficult, if not impossible, to prove guilty knowledge by direct evidence. Unless we had evidence of unequivocal acts or statements of the defendants showing criminal intent on their part, this element

Many of the arguments and explanations presented by the learned counsel for the defendants go far to clear some of the specifications of perjury from criminal motive. Many of the instances of false statements which the grand jury charges as perjury are apparently explainable. A judge presiding at the trial of the indictments may, on hearing the proof, refuse to submit these matters to the jury, or, having done so, may advise the jury to acquit, but granting the power of the court to dismiss an indictment at any time in the interest of justice, where we find a definite charge made and apparently supported by prima facie proof, followed by indictment by a grand jury, it is subversive of all legal principles in this country, for a judge, on a preliminary motion, to assume to himself the power to

There are now one or two other matters presented upon the argument and in the briefs submitted, to which I will refer. If this indictment for perjury was based solely upon the affidavit attached to the report prepared for publication, which report contained the statement that the total of bills payable as reported did not mature or become due until December, 1910, I should have grave doubt whether this unnecessary affidavit to what was in effect a summary of the report itself could be made the basis of a prosecution for perjury. The report prepared for publication is not required" to be verified under the Banking Law. But while this is one of the many specifications in the indictment, the charge of perjury is not based solely upon that affidavit, or upon that report. The charge is that the main report was untrue in stating total assets and total liabilities, in showing a solvent institution, when in fact the bank was insolvent, the alleged discrepancy between the resources and liabilities, as reported and sworn to, varying from the truth and facts in amounts reaching millions of dollars. While evidence as to the transactions concerning this published report may be relevant on the question of intent on the main charge standing alone, I agree with defendants’ counsel that it would not warrant indictment.

The learned counsel for defendants also comment upon the legal effect of the addition to the affidavit of the defendants of the words “ to the best of his knowledge and belief.” By chapter 689, Laws of 1892, the affidavit prescribed for these reports was to the effect “ that the same is true and correct in all respects.” By amendment, chapter 333, Laws of 1898, the form of the oath was amended by adding these words, “ to the best of his knowledge and belief.” I have read the opinion in the case of Davenport v. Prentice, 126 App. Div. 451 , and the

The defendant Ashley urges as error the reading in evidence, before the grand jury which returned this indictment, of certain testimony given by him voluntarily, and upon waiver of his right to refuse to testify, before a previous grand jury in 1911. I think the People were entitled to prove any voluntary declaration made by'him concerning the matter under investigation. People v. Kennedy, 159 N. Y. 346 ; People v. Rogers, 192 id. 331; People v. Brasch, 193 id. 46.

I have carefully examined the specifications or particulars set forth in the indictment and the criticisms and explanations of the defendants’ counsel concerning each of these separate charges. I refrain from discussing them separately here in justice to all the parties. These same arguments may well be presented to the judge at the trial, who, as I have suggested, has far broader powers and duties than a judge at special term passing upon a motion to dismiss the indictment. I do not want my omission to discuss them separately here taken as an indication that I have not examined them carefully. Many of these arguments would be very persuasive if addressed to a motion to withdraw certain of the items from the consideration of a jury at the trial. But to dismiss an indictment of this kind on a preliminary motion upon the theory that a judge at special term may take to himself the function of the jury and pass upon the facts and the inferences and the vital question of intent, is contrary to my understanding of the fundamental law.

It follows that the motions to dismiss the indictments must be denied.

Motions denied.