Adler v. United States

182 F. 464, 104 C.C.A. 608, 1910 U.S. App. LEXIS 4941
CourtCourt of Appeals for the Fifth Circuit
DecidedOctober 3, 1910
DocketNo. 2,049
StatusPublished
Cited by60 cases

This text of 182 F. 464 (Adler v. United States) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Adler v. United States, 182 F. 464, 104 C.C.A. 608, 1910 U.S. App. LEXIS 4941 (5th Cir. 1910).

Opinion

SHERRY, Circuit Judge.

The defendant, William Adler, president of the State National Bank of New Orleans, was indicted in 82 counts for misapplication, abstraction, and embezzlement of the funds of the bank. He was tried, and the jury returned a verdict convicting him on 74 counts, to wit, counts 1, 3, 7, and 9 to 79, inclusive, all of which are for the misapplication of funds. The relevant part of the statute on which the counts for the misapplication of funds are based is as follows :

“Every president, director, casiiier, teller, clerk, or agent of any association, who embezzles, abstracts, or willfully misapplies any of the moneys, funds or credits of the association * * * with intent, in either ease, to injure or defraud the association or any other company, body politic, or corporate, or any individual person, or to deceive any officer of the association, or any agent appointed to examine the affairs of any such association * * * shall be deemed guilty of a misdemeanor, and shall be imprisoned not less than five years nor more than ten.” Rev. St. U. S. § 5209 (U. S. Comp. St. 1901, p. 3497).

1. The first count charges the defendant with the misapplication of $20,000. A condensed statement of that count will show what it is necessary to prove to secure a conviction on it. It charges that the accused, on September 23, 1907, with intent to injure and defraud, executed his promissory note for $20,000, and, as president of the bank, caused the note to be discounted by the bank, and the proceeds to be placed to his credit on the bank’s books, to be thereafter withdrawn by him from the bank, and that said amount was wholly lost to the banking association. The note is set out in the count, showing it to be a demand note, secured by the pledge of 200 shares of Siempre Viva Mining Company stock. The count further charges that the note was not well secured, and that the accused was not worth the amount of the note above his other liabilities, as was well known to him at the time he directed the discount. This count, in brief, charges that Adler, by the means described, willfully, wrongfully, and unlawfully misapplied and received $20,000 of the moneys of the bank, and that the bank, by the transaction described, lost that sum. It clearly charges an-offense within the statute, and, if the evidence tended to sustain the charge, it was'proper to submit the question to the jury. There is no conflict in the material evidence relating to the count.

When this note was made and discounted, Adler’s account was already overdrawn $18,303.80. It is not charged that there was any wrong or irregularity in the overdraft. He is not prosecuted for that. The proceeds of the discounted note, being placed to Adler’s credit, canceled the overdraft, the amount of which was then represented by or included in his note, and left a cash balance of $1,146 to his credit. This sum he drew out of the bank and used before October 10, 1907. As to the overdraft of $18,303.80, the only effect of the transaction was to include it in the note, and to secure it, so far as it was secured by the collateral. As to the amount of the overdraft, the bank was in a better position than it was before the transaction. No one would claim that, as to the amount of the overdraft its position was worse. The mere ch'ange of the form of an existing indebtedness from an account to a note is not a violation of the statute. We must therefore direct our,,.attention alone to the new.credit of $1,146 which Adler obtained. [467]*467Is it true, as charged, that this sum “was not then and there well secured, as he, the said William Adler, well knew at the time”? We do not think the evidence leaves any doubt that the collateral was sufficient security for this new credit. The record shows that there was realized on the collateral $5,000 in cash, which pays in full the new credit, and pays about $3,800 on the overdraft.

The evidence relating to the transaction described in the first count shows that the bank was not injured, but benefited, by the taking of the note and collateral for the overdraft. It is true that it extended an additional credit for $1,146; hut it was well secured, and has been paid, and a further payment secured on the overdraft. The circumstances connected with the overdraft are not presented for consideration. The credit allowed by the overdraft must be presumed to be legitimate and fair till the contrary is charged.

The defendant was entitled to a peremptory instruction directing his acquittal on the first count.

2. The third count charges that on July 8, 1907, the defendant caused H. S. Renshaw, the manager of the firm of Brown & Harris, to make his individual note for $40,000, due on demand, and that the defendant, as president of the State National Bank, caused the note to be discounted by the bank, and the proceeds, $40,000, to be placed to the credit of Brown & Harris on the bank’s books, of which firm the defendant was a member, and that by means of such discount the firm obtained a false credit of, and was thereby entitled to draw out, and did draw out, of the bank, the sum of $40,000, which sum was lost to the bank.

The evidence does not tend to sustain the charge that as much as $40,000 was withdrawn from the bank by the discount of the Renshaw note. The facts are that Brown & Harris’ account was already overdrawn, as shown by the bank’s books, in the sum of $34,753, and in a larger sum, as shown by the account as kept by Renshaw. But the evidence tended to show that, by the discount of the note, Brown & Harris obtained a new credit of $3,054, which they subsequently withdrew from the bank. A conviction could not be based upon the substitution of the Renshaw note for the overdraft of $34,753, so attention must be directed to the new credit which- Brown & Harris obtained in excesss of the overdraft. It is contended on behalf of the government that the defendant obtained this new credit with intent to injure and defraud the banking association, and that the sum obtained by the transaction was not secured. The defendant contends that there was no intention to injure or defraud, and that the sum was amply secured by the deposit of collateral. The evidence on this and other issues raised, by this count was conflicting. There was evidence tending to show the deposit of 500 shares of Siempre Viva Mining Company stock as collateral security for the Renshaw note; but its deposit and delivery were under circumstances that made it a question for the jury as to whether or not it was really deposited as security for the note. There is much conflicting evidence in the. record as to the value of the stock. The evidence that bears on the intention of the defendant in the transaction is voluminous. In some instances it is conflicting, and in others it is of facts from which different conclusions [468]*468migfit be drawn by different minds. We do not think it would serve any useful purpose to comment at length on the evidence relating to this count. It is sufficient to say that we cannot sustain the defendant’s contention that, on the record before us, he was entitled to peremptory instructions for an acquittal on the third count. The government presented sufficient evidence to have the count submitted to the jury.

3.

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Bluebook (online)
182 F. 464, 104 C.C.A. 608, 1910 U.S. App. LEXIS 4941, Counsel Stack Legal Research, https://law.counselstack.com/opinion/adler-v-united-states-ca5-1910.