Mutscher v. State

514 S.W.2d 905, 1974 Tex. Crim. App. LEXIS 1883
CourtCourt of Criminal Appeals of Texas
DecidedSeptember 24, 1974
Docket48160-48162
StatusPublished
Cited by98 cases

This text of 514 S.W.2d 905 (Mutscher v. State) is published on Counsel Stack Legal Research, covering Court of Criminal Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mutscher v. State, 514 S.W.2d 905, 1974 Tex. Crim. App. LEXIS 1883 (Tex. 1974).

Opinion

OPINION

MORRISON, Judge.

The offense is conspiracy among two Members of the House of Representatives and a state employee to accept a bribe with the understanding that the two Members would use their vote, influence and powers of their office to procure and assist in the passage of certain legislation which thereafter would be brought before them in their official capacities, in violation of Article 159, Vernon’s Ann.P.C. 1 ; the punishment as to each appellant, five years probated.

The parties to the events which resulted in this prosecution were:

Gus F. Mutscher, Jr., — Speaker of the Texas House of Representatives

Thomas C. Shannon — a sixteen year veteran of the Legislature

S. Rush McGinty — Executive Assistant to Speaker Mutscher

Gus F. Mutscher, Sr. — father of Speaker Mutscher

F. C. Schulte — Administrative Assistant to Speaker Mutscher

Frank W. Sharp — Chairman of the Board of Sharpstown Realty Company; Chairman of the Board of Sharpstown State Bank; Chairman of the Board of National Bankers Life Insurance Company *910 Father Francis Kennelly — Jesuit priest and honorary director of Sharpstown State Bank

Joseph Novotny — Executive Vice President of Sharpstown Realty Company; President of Sharpstown State Bank.

Initially, appellants challenge the sufficiency of the evidence.

The State’s theory of this case is that Mutscher heard of Sharp’s interest in an individually licensed state banking insurance supplemental to or in lieu of Federal Deposit Insurance. Mutscher approached Sharp about buying into one of Sharp’s enterprises (Bankers Life Insurance) on credit and at the same time dangled the bait of passing Sharp’s pet deposit insurance bill. When Sharp responded to these advances, Mutscher then made it known to Sharp that he was not alone in this venture and needed the help of his fellow legislator Shannon.

In order to determine whether this theory has been supported by the evidence, we summarize from the testimony of several witnesses:

The witness Novotny described Sharp as “probably a genius in many areas, but as far as terminology in the banking business, he didn’t know the difference in an overdraft and a cash item.” He stated that Sharp owned Sharpstown Realty Company, National Bankers Life Insurance Company and a “spin off” corporation, Master Control, and the Sharpstown Bank. He described Sharp as a braggadocious person who talked very much about his acquisitions. He stated that on one occasion Sharp predicted he would drain a swamp in Louisiana and build a city where the swamp had been, and mentioned other farfetched ideas such as building a city the size of Wichita Falls on his ranch near Junction. Another time Sharp discussed how he might acquire Braniff Airways and Royal Dutch Oil Company.

From other witnesses we learn that Sharp had given stock to the Jesuit Order and to such important personages as astronauts.

Sharp testified that prior to and at the time involved in this case, his bank, Sharpstown State Bank, was having trouble with the State Banking Department and the Federal Deposit Insurance Corporation, as they had been very critical of the loans of his bank. He was interested in getting his plan for bank deposit insurance adopted into law and frequently made this known to Mutscher in person and by letter. Soon thereafter they met privately in Houston at which time Mutscher told Sharp of some personal financial losses he had experienced in a “Siboney” stock deal, and he “dwelt on that considerably.”

We quote further from Sharp’s testimony:

“And as I was leaving, he [Mutscher] said more or less in a by the way manner, ‘How is National Bankers Life coming along’ — and he made the remark that he might buy some of the stock himself.”

Two or three days later in a telephone conversation Mutscher informed Sharp he and his associates wanted to buy stock in National Bankers Life and asked permission for his father to buy some also. Mutscher told Sharp that in order to make the purchase, some sort of financing would be required. Sharp indicated to Mutscher that financing arrangements might be available through Sharpstown State Bank. Sharp later contacted Novotny, Sharps-town State Bank President, and gave his “blessing” to the loans.

The purchases were soon thereafter effected with the purchasers executing notes which can only be described as unsecured notes, since they were accompanied only by appellants’ financial statements as collateral. Prices paid for the stock by appellants ranged from 11⅛ for Shannon and Mc-Ginty to 13 for Mutscher. The size of the loans obtained by these appellants and the unsecured nature of the loans have even more significance when viewed in the light *911 of the extensive scrutiny the bank was under from several fronts.

The amount of the loans taken out by each appellant, the number of shares purchased, and subsequent profits are shown on Table One. 2

At Sharp’s suggestion, the bank deposit insurance bills were then prepared and delivered to appellant Shannon at the House of Representatives. On September 9, the legislation passed and Mutscher called Sharp and told him of the passage of the bills. On September 10, Mutscher called Sharp and told him he wanted to sell the stock. The same day Sharp began to manufacture a market for the stock by getting in touch with Kennedy,

The Jesuits at this time held 20,000 shares of Sharpstown Bank stock which they wanted to sell for $50 per share. Sharp had advised the Jesuits that he would find a buyer for these shares and had further encouraged the Jesuits to invest the resulting million dollars in National Bankers Life stock. Father Kennedy’s presence at the bank on September 11 was for the purpose of following through with this arrangement. 3

The sale by these appellants was made the next day, September 11. The price was $20 a share. 4

On September 10, Sharp realized that on the following day he had to be able to sell close to a million dollars in bank stock in order to pay off his political associates. 5

We now come to appellant Shannon’s participation in the conspiracy. In one of the earlier meetings, Mutscher had told Sharp he was not very wed versed in insurance matters himself, but had an associate who was wed informed on such matters and before they moved any further he would need Shannon’s opinion. When the bids were prepared, they were delivered to Shannon’s office in the Capitol. Shannon presented the bids at the committee meeting and secured their approval by the committee. After leaving the committee meeting, Shannon, after being recognized by Mutscher on the floor of the House, got the bids passed by the House. Shannon was in Houston at Sharpstown State Bank *912

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Bluebook (online)
514 S.W.2d 905, 1974 Tex. Crim. App. LEXIS 1883, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mutscher-v-state-texcrimapp-1974.