SUPREME COURT RECORDS PAGE 11

 

File contributed by Lisa Lach and proofed/formated by Dena Stripling

Appeal from District Court, Potter County; H. L. Umphres, Judge.

Mike C. Le Master was convicted of unlawfully becoming indebted to a state bank of

which he was president, and appeals. Reversed and remanded, and rehearing denied.

 

 

In the prosecution of a state bank president for unlawfully becoming indebted to the

bank by being a member of a partnership which borrowed money from the bank in the name

of two others, it was error to admit evidence of transactions after the alleged offense

tending to show a partnership at that time.

 

 

An instruction to convict if defendant became unlawfully indebted to the bank of which

he was president, without stating that he must have become indebted through a secret

partnership alleged in the indictment, held erroneous.

 

 

Evidence in the prosecution of bank president for unlawfully borrowing money through

secret connection with a partnership to which the loan was made, held insufficient to

show that defendant was a partner, and through the partnership became indebted to the

bank.

 

 

Indictment held to sufficiently charge the defendant bank president in a general way with

becoming indebted to the bank, but not to authorize admission of evidence of transactions

showing his indirect liability through membership in a firm to which the loan was made.

 

 

In prosecution of bank president for unlawfully borrowing money from bank, held, that the

court should have limited evidence of subsequent transaction to its effect as tending to

show existence of partnership of which president was a member, declared on in the indictment.

 

 

Permitting the state to withdraw evidence held error, regardless of whether the evidence

was introduced by the state or elicited by accused on cross- examination of the state's

witness.

 

In prosecution of bank president for unlawfully borrowing money through a loan made to a

firm of which he was a secret member, held error to instruct on the law of partnership

without applying such law to the facts.

 

Error in an instruction in a case wherein accused was convicted required a reversal, where

it was speculative as to what the verdict would have been under a correct instruction.

 

 

Failure to instruct that defendant should be acquitted of unlawfully borrowing money

from a state bank of which he was president, through his secret membership in a firm,

unless the partnership existed as alleged, held fatal error where the evidence as to

the existence of the partnership was conflicting.

**830 *578 A. A. Lumpkin, of Amarillo, and Cooper & Merrill, of Houston, for appellant.

*579 Martin, Kinder, Russell & Zimmermann, of Plainview, and C. C. McDonald, Asst. Atty.

Gen., for the State.

 

 

DAVIDSON, P. J.

Appellant was convicted of becoming indebted to a state bank, of which he was president,

in the sum of $8,000.

The first count in the indictment sets out the particulars of the transaction relied upon

by the state, but this count was discarded by the court in submitting the case to the

jury, and he submitted only the second count, omitting the third count. The count

submitted charged that appellant was duly elected, qualified, and acting president, and a

member of the board of directors of the First State Bank of Amarillo, a banking corporation

theretofore incorporated and engaged in the business as a state bank in the city of

Amarillo under the authority of the laws of the state, and as said officer he became

indebted to the bank in the sum of $8,000, without the consent of the majority of the

board of directors, and without having the matter duly registered or inscribed upon

the minutes of the bank.

The indictment is attacked in that it fails to apprise the defendant of the nature and

circumstances of the case and wherein he had violated the law. He invokes the statutory

rule, which is settled, that everything necessary to be proved must be alleged in the

indictment. The writer is of opinion this indictment is too general and does not

specifically notify the defendant of the transaction for which he is to be tried, and

that the only allegation in the submitted count is of a very general nature and to the

effect that he became indebted to the bank in the sum of $8,000 without proper authority

from the board of directors. The writer is of opinion, without going into a discussion

at any length of the matter, that the count submitted to the jury is not, within the

contemplation of the law, sufficient. The general allegation that appellant had become

indebted to the bank in the sum of $8,000 is too *580 general. There is a want of

particularity about it, and it does not inform the defendant of what transaction he

is charged. There is nothing to describe the manner of indebtedness, or how it came

about, so as to notify defendant of the matters and transactions that he was to meet

by the proof. The first count set out particularly these different matters and gave

appellant notice of how and when and the circumstances attending the indebtedness,

and how it came about, but the court did not submit this to the jury. This much is

said in a general way.

It will be noticed upon investigation of the case that all the facts to be relied

upon by the state were known at the time the indictment was presented, and as to

how the indebtedness was created, if there was any. The facts in this connection,

as relied upon by the state, were made through the testimony of an accomplice,

McSpadden. His testimony, substantially, is that Morris came and notified him of

the fact that he could buy an optional cattle contract, the cattle being in Arizona;

that he thought this option could be bought at $5,000, and if he had the money the

trade could be made and profit made out of it by selling this contract for an enhanced

value to other parties. His object in calling McSpadden was that McSpadden might enable

him in some way to get the money. They discussed it, and McSpadden, not having the money,

suggested they see appellant, who was president of the State Amarillo Bank, and get him

to furnish the money. Appellant was called, and McSpadden's testimony is to **831 the effect

that after discussing it appellant agreed to furnish the money; Morris and McSpadden

signing the note at the bank for $5,000. There was something said to the effect that

it was not probable that the option could be bought at $5,000; that it might take more

money. McSpadden further testified that appellant, Morris, and himself agreed that

Morris and McSpadden were to sign a note to the bank and have the money transferred

to their credit, and that appellant was to be a partner in the profits and maybe

losses, but his name not to be known in the matter, and in this way that appellant

became a partner in the purchase of the cattle option contract. He also testified

that there was no other cattle contract, in contemplation or discussed between them at

the time. His language was:

"Yes, sir; it was agreed that Mike C. Le Master was to advance the money on the condition

that I went along and used what influence I possessed to keep Morris from getting drunk,

and Gus agreed not to get drunk any more, and straighten up. There was nothing said at

that time about any other transaction. We were to do the best we could. We did not know

exactly how much money it would take, but we were to let Mr. Le Master know. We wanted

to get an option on the cattle for spring delivery and then sell the option. The agreement

was that Mr. Le Master was to advance the money to be paid as a forfeit on the cattle

and Morris and myself were to go out there and get a contract and purchase them and sell

the contract."

This occurred on the 26th day of December, and on the 27th a note *581 was executed by

Morris and McSpadden to the bank, appellant's name not appearing in any of these matters.

Upon signing the note Morris and McSpadden left Amarillo and went to El Paso. They there

got in touch with the owners of the cattle and bought the option. The owners of the cattle,

however, required $8,000 instead of $5,000. By wire appellant was notified of that fact.

He took the Morris and McSpadden note and wrote above the 5,000 3,000. The intention it

seems was to make the note for $8,000 instead of $5,000. The deal was made, and in three

or four days the option was transferred at a profit of considerable amount and closed

out, and Morris and McSpadden came back to Amarillo and deposited the money in the state

bank at Amarillo, and on the 6th of January took up and paid off the note. Appellant was

not in Amarillo at the time, but was in Ft. Worth. He knew nothing about the payment of

the note until later information was conveyed to him. Morris testified in many respects

as did McSpadden, but he denied that Le Master had or was to have any interest in the

option contract, and was in no way connected with the profits or losses. In fact, he was

in no sense, or in no way interested in the contract, nor was he to receive any profits,

dividends, or pay any losses. Appellant testified in his own behalf as did Morris.

After returning to Amarillo and taking up the note McSpadden and Morris, without the

knowledge of appellant, went to New Mexico with a view of purchasing other cattle.

Appellant had nothing to do with this and knew nothing of this matter.

[1][2] There were other subsequent cattle deals by McSpadden and Morris which the

state undertook to connect appellant with by McSpadden's testimony. Both Morris and

appellant denied that there was any partnership. There was evidence introduced by

the state to show these subsequent transactions over the protest and objection of

appellant. We are of opinion these objections were well taken. The court also failed

to limit this testimony. Having admitted the testimony, the court should have limited

it. It was not in reference to the original case and could not be, and if it was

introduced for any purpose it was to show that by reason of the subsequent transactions

between the parties that they were partners in the original transaction declared

upon in the indictment. As before stated, we are of opinion these matters should

not have gone before the jury, but having been permitted to be introduced, the court

should have limited them to their proper office in his charge. The state's testimony

as well as that for the defendant all agree that if appellant had any connection

with any of these transactions it was the one based on the note, and the sum finally

drawn from the bank of $8,000, which was paid back within ten days by Morris and

McSpadden. McSpadden says there was no other transaction in contemplation or under

discussion. Morris uses the same language and testifies to the same thing, so does

appellant. So it would be evident that subsequent transactions if entered into

independent or disconnected with *582 the first, not growing out of or related to

it in any way, could not come into the case as testimony on the question of partnership

in the first transaction.

There was nothing said, as McSpadden, Morris, and Le Master all testify, as to any

other trade either then or in contemplation for future dealings. The fact that later

they may have made other trades, or that appellant may have become interested in later

transactions, could not afford testimony proving a partnership in a single transaction

which begun and ended with itself. These latter matters had no relation to or bearing

upon the case; they did not serve to identify or develop the case; were not res gestae,

nor could possibly reach the question of system. The matter is here dealt with generally

without going into details as shown by defendant's bills of exception with reference to

these matters. There are several of these matters, all of which upon another trial

should be excluded.

[3] The state introduced Mr. Mood as a witness, and was proving by him some matters

that occurred on the trial of a civil case in which he took down the testimony as

stenographer. It seems they were seeking **832 to prove the testimony of apellant

while testifying in his own behalf on the trial of the civil case. There are several

pages of these questions and answers set out in the bill so as to make it clear and

plain. It developed in his testimony that on the trial of the civil case appellant

won; that the jury found a verdict in his favor. When the testimony of Mr. Mood was

complete, or they had become satisfied about it, the state moved to exclude all his

testimony from the consideration of the jury. The appellant excepted. The state's

counsel put their motion to withdraw the testimony on the ground that they did not

purpose to introduce the record in the civil case. These matters are generally stated,

and not the details. We are of opinion that the objections of the defendant were well

taken. The testimony should have remained before the jury. Among the early cases on this

question in Texas is Speight v. State, 1 Tex. App. 552. The first section of the

syllabus of that case sufficiently states the question:

"If the accused elicits testimony adverse to himself, he must take the consequences;

and he is not entitled to have it withdrawn from the jury because part of the same

proof, when offered by the prosecution, had previously, on his objection, been excluded

by the court."

In that case the defendant moved to exclude testimony introduced by himself that he

thought adverse to him. The state would occupy no better position under the same

circumstances than would appellant. The testimony, as said in the Speight Case, if

illegal at all, was his own testimony, and we opine he ought to be held to take the

consequences, and could not exclude it simply because it was found to be unfavorable

to his case. In Moore v. State, 6 Tex. App. 563, the question came again. The headnote

of that opinion is as follows:

"If the defendant elicits testimony adverse to himself, he must abide the consequences;

and that a state's witness, upon cross-examination by the defendant, testified to a

confession made after arrest, is not cause for *583 a new trial, as having improperly

gone to the jury."

The doctrine was approved in Allen v. State, 8 Tex. App. 67, and Robins v. State, 9 Tex.

App. 671. In the case of McDade v. State, 27 Tex. App. 641, 11 S. W. 672, 11 Am. St.

Rep. 216, the question again came. At page 689 of that report (11 S. W. 675) the court

said:

"In the seventh assignment of error it is complained that 'the court failed to instruct

the jury that the declaration of Allchin to Felker that threats had been made against

him by defendant was not any evidence that such threats were made, and that they should

not consider such statement as a part of the evidence for that purpose, when it was

expressly requested so to charge by defendant.' This evidence was drawn out by defendant

upon the direct examination of his witness Felker, and neither the prosecution nor the

court was responsible for it. If the defendant elicits testimony adverse to himself he

must abide the consequences"--citing Speight v. State, 1 Tex. App. 551, and Moore v.

State, 6 Tex. App. 562.

The state having introduced Mr. Mood as a witness, and his testimony being introduced

without objection from the defendant, the state could not, because the testimony was

somewhat damaging to its case, withdraw it from the jury. The state introduced it and

could not withdraw it over objection of appellant. The above cited cases seem to settle

that question.

There are exceptions to the second subdivision of the charge on various grounds. This

subdivision limits the jury to the second count, and charged if the jury should find

appellant was an officer duly elected, qualified, and acting president and a member of

the board of directors of the state bank, and that the bank was incorporated, etc., and

he became indebted to that bank in the sum of $8,000 without proper authority from the

board of directors, they should convict him. It will be noticed in this connection that

this charge submits the fact that he was president and one of the board of directors.

The indictment, while it mentioned the fact that he was an officer and member of the board

of directors, it did not attempt to charge him with being guilty of violating the state law

as a director, but only as president or acting president. The president cannot borrow any

amount of money from the bank without proper authority. The indictment did not undertake

to charge any matter that would make him criminally liable as a director. He was charged

as the president of the bank, and not as a member of the board of directors. If he was

sought to be convicted as a director, then the charge should have specifically brought

that matter to the attention of the jury.

[4] It will be noticed that this charge does not undertake anywhere to inform the jury

as to the relation of appellant to the amount of money or the circumstances by which he

could have possibly been indebted to the bank. All the testimony and the indictment

excludes the idea that his name was on the bank books. The proof all shows that it was

not, and that there was no contract and no evidence in the bank books, records, or

papers that his name was in any way connected with *584 any indebtedness to the bank.

The only way by which it was sought to hold him liable was through the testimony of

McSpadden that he was a secret partner in the profits and losses that might arise in

the option contract which Morris and McSpadden accomplished and for which the bank is

supposed to have furnished the $8,000. In order, therefore, to hold appellant guilty,

the charge should have conformed to the facts, and in order to hold him the state would

have to show that he was guilty under the circumstances detailed by the state's witness

as partner. In other words, in order to convict appellant the jury should have been

instructed that they would have to find that appellant became indebted to the bank by

means of this partnership matter **833 about which McSpadden testified. This was the

state's case, and it was all the state had or put into the trial. In this same connection

it may be well enough to notice that section 3 of the charge is a general statement of

the law of partnership as understood by the court in giving his charge, and it reads as

follows:

"A partnership is formed by two or more persons placing their money, effects, labor and

skill or some one or all of them in business with the purpose and intention of dividing

the profit and bearing the loss in certain proportions and may be made and entered into

either by express agreement, oral or written, of those forming the partnership, or it

can result from the conduct of the parties in relation to the business. Those forming

the partnership are partners. When a partnership is formed each individual partner in

relation to partnership business in law binds himself and each of the other members of

the partnership jointly and severally for any partnership obligations made in furtherance

of the partnership enterprise and within the scope of the partnership business."

[5][6] This is all the charge with reference to partnership. It will be seen that it has

no reference to and is not connected back with the other charge; nor does the other charge

refer to partnership, nor is the jury charged that if appellant was a partner within the

terms of the law with McSpadden and Morris, and under that partnership there was or

could be an indebtedness created for which appellant would be responsible, they might

convict. This definition of partnership is thrown into it in a general way without any

application of the rule of partnership to the facts in the ease, or facts of the case

to the partnership. In the second clause of the charge which submits the law for

conviction the partnership is not mentioned. Under the facts it was all the state

had upon which to predicate a conviction. In the charge on partnership it does not

inform the jury that if appellant connected himself with this indebtedness by means

of this partnership, and was responsible under the terms of the contract by reason of

this partnership, that he might be liable for the indebtedness, but instructs the jury

to convict for the indebtedness in the second clause, and gives a general definition

without any application of the law to the facts of partnership. If appellant was

guilty at all it was under McSpadden's *585 testimony to the effect that he agreed

to divide the profits and losses and carry the partners under the contract, and that

he did furnish the money from the bank. The state admits error in the charge on

partnership as given, but asserts the error was favorable to appellant. It was error,

and we think harmful. The error is conceded; the verdict was guilty. What may have

been the verdict under a correct charge is speculative, but it is not speculative

that he was found guilty.

 

[7] There is another phase to this charge that is fatal. McSpadden swore to this

partnership as set out in the early part of the opinion. Morris and appellant denied

it emphatically. There was an issue sharply drawn by this testimony as to whether

this partnership existed or not. The bulk and the weight of the testimony was that

the partnership did not exist. The jury so found by their verdict in the civil

proceeding and exonerated appellant as partner and found in his favor in the suit

against himself and Morris by McSpadden. This was shown by the testimony of Mood.

Now the converse of the proposition, had the partnership been properly charged,

was if the jury should find there was no partnership existing between these parties

at the time, they should find in his favor and acquit him. Such omission is fatal

error.

[8] It is contended that the evidence is not sufficient to show that appellant was

a partner, and that through the partnership became indebted to the bank. The writer

is of opinion that this proposition is correct. McSpadden testified, and he alone,

that appellant was to be connected with the profits or losses, and Morris testified

positively that such was not the case, and that he and McSpadden alone were

responsible, and that he was to get two-thirds of the profits and McSpadden one-third,

and that appellant had nothing to do with it. McSpadden testified they were to be

equal partners, each getting a third. There were some telegrams passing between the

parties with reference to this $8,000 option contract introduced by the state, but

these did not show that a partnership existed. It was with reference to the fact

that the $5,000 first agreed upon and mentioned in the note was not sufficient, and

appellant agreed to furnish the extra $3,000 from the bank, and later wrote it in the

note. The note was payable to the bank, and appellant was in no way concerned with it,

and if he was connected in any manner with it it was by reason of McSpadden's

testimony, which appellant and Morris both denied. As it occurs to the writer, there

is no testimony which supports or corroborates McSpadden in his statement. If,

however, the state should further prosecute, the testimony should be limited to

the transaction about which the witnesses testified and not extend it to subsequent

contracts in no way connected with or related to the one under investigation.

The judgment is reversed, and the cause remanded.

 

 

*586 On Motion for Rehearing.

[9] On a former day of the term the judgment was reversed and the cause remanded.

The state contends in a motion for rehearing that the court was in error in holding

that the indictment was not valid. It was stated that the general allegation that

appellant had become indebted to the bank in the sum of $8,000 was not specific enough

and entirely too general; that it was wanting in particularity, and failed to inform

the defendant of the transaction, for which he was **834 to be tried. The writer,

upon further investigation, still adheres to his original views. The majority,

however, do not agree with him. Under the view of the majority the former opinion

will be modified and the indictment held sufficient to charge appellant in a

general way with becoming indebted to the bank in the specified sum. The indictment

contained three counts. The first set out the facts attending the transactions

by which it was sought to connect appellant with violating the banking law, he

being president of the bank. That count, however, was not submitted to the jury

by the court, and passed out of the case. The second count was submitted in which

the general allegation was made that appellant became indebted to the bank of

which he was president. Under these allegations the state would be required to

prove that appellant had become directly indebted to the bank, and that proof of

the matters and facts set up by the state in its evidence would not meet the count

upon which the conviction was obtained, which evidence was to the effect that

appellant and McSpadden and Morris entered into an agreement by which they were to

buy cattle and the bank furnish the money, predicated upon a note given by McSpadden

and Morris, and the money transferred on the books of the bank to their credit, and

that appellant would be a partner in the profits and losses of the cattle transaction

for which the note was given to secure funds in payment of the cattle. Appellant's

name does not appear anywhere either in the note or on the bank books, and on the

face of the transaction he is not directly shown to be connected with any of those

matters. In other words, it was a secret partnership, if it existed. This was

perhaps the most serious question in the case so far as the evidence was concerned.

So following the views of the majority, the count will be held sufficient to

charge an offense, but not to admit evidence of the transactions showing an

indirect liability as sought by the state; that this would be a variance

between the allegation in the count submitted and the evidence, and therefore the

evidence did not support the finding of the jury under the count and the charge

submitting that count.

In regard to what was said in the original opinion with reference to a bill of

exceptions which contains matters and things set out through the witness Mood, the

state contends that the opinion was *587 in error in holding that state's counsel

was responsible for withdrawing all the testimony of Mood from the jury. The

contention is that the state did not withdraw the statements of Mood on cross-examination

by appellant's counsel to the effect that appellant had won the civil suit. Strictly

and technically speaking this contention may be correct. The bill in regard to this

matter shows that when Mood was placed upon the stand and the various questions asked

and answers elicited, he was then passed to appellant's counsel for cross-examination,

and, among other things, it was elicited from him that appellant had won the civil

suit in which McSpadden sued Morris and himself for settlement of alleged partnership

matters, which involved the $8,000 matter. State's counsel objected to this cross-examination

as to the matters elicited from Mood, but the court overruled the objection upon the

ground that the state had drawn out the matter, and this was a legitimate cross-examination.

When this occurred the bill of exceptions recites that:

"Thereupon the state rested, and stated they desired to consult a moment, and within

a few minutes returned to the court, and through their private prosecutor, Mr. Martin,

stated to the court, 'We are not going to introduce any of the record, and we ask that

the court strike out the testimony of Mr. Mood in regard to it.' (The record referred to

being the transcript of what purported to be the statement of facts in the case of W. A.

McSpadden v. R. A. Morris et al., in which the state's counsel had attempted to prove up

by A. M. Mood for the purpose of offering the same and parts thereof to impeach the

defendant as a witness.) The court then stated, 'What part of the record do you have

reference to?' Mr. Martin stated in reply to such question, 'All of Mr. Mood's testimony

identifying the record, since we are not offering any of the record, that evidence

would serve no purpose. We do not intend to offer the record, and we would like to have

this testimony stricken from the record, since it does not tend to prove any issue in

this case."'

Thereupon defendant's counsel objected to the withdrawal of any of the testimony by the

state for the reason they had offered the same, and when it was proved harmful to them

they desired to withdraw it, and that it was material and beneficial to the defendant,

and that they had no power to withdraw it when they had offered it themselves, and they

considered it harmful to then be permitted to withdraw it. The court, not specifically

ruling on the objection, turned to the jury and instructed them as follows:

"I will strike out and instruct the jury not to consider the testimony of Mr. Mood."

In the former opinion the writer was under the impression that, legally speaking, state's

counsel were responsible for being really the moving parties in getting the matter before

the jury as well as to its final withdrawal or exclusion after putting it in before the

jury; that it was too late for the state to withdraw it after cross-examination of the

witness in reference to the matter they had drawn out; and that their motion, had it

been sustained, would practically have operated to withdraw all the testimony of the

witness Mood, *588 whether it was direct or cross-examination. If the writer was in

error about this, then counsel for the state may not have been altogether responsible

for the withdrawal of Mood's testimony favorable to the defendant. But the matter was

so intermingled--the direct and cross examination taken--with the remarks of the court

it occurred to the writer that the effect **835 of the state's motion was to withdraw

all the testimony, especially in view of the fact that this motion was not made until

after Mood developed the fact that appellant had won the civil suit. This testimony

seems to have been introduced by the state for the purpose of laying some predicate

with reference to the case and the testimony of defendant in the civil suit, but when

Mood testified to the fact that appellant had been eliminated from that record by the

verdict of the jury, counsel moved to exclude or withdraw the testimony from the jury.

State's counsel insist strenuously that they did not undertake to withdraw the testimony

introduced on cross-examination, and that they were only undertaking to withdraw that

which they introduced. Without going into any detail about the matter, or any discussion,

we place it as the record does, so that it will be fully understood and its effect and

result from the whole bill of exceptions may not be unjust to either side. The result,

however, would be the same. This testimony was withdrawn from the jury, and under the

circumstances it should not have been withdrawn. It is deemed unnecessary to discuss

the other matters.

Finding no reason why the motion for rehearing should be granted, it is ordered that

said motion be overruled.

Tex.Crim.App. 1917.

LE MASTER v. STATE.

196 S.W. 829, 81 Tex.Crim. 577

END OF DOCUMENT

 

================

 

Appeal from District Court, Potter County; H. L. Umphres, Judge.

Mike C. Le Master was convicted of unlawfully becoming indebted to a state bank of

which he was president, and appeals. Reversed and remanded, and rehearing denied.

 

 

In the prosecution of a state bank president for unlawfully becoming indebted to the

bank by being a member of a partnership which borrowed money from the bank in the name

of two others, it was error to admit evidence of transactions after the alleged offense

tending to show a partnership at that time.

 

An instruction to convict if defendant became unlawfully indebted to the bank of which

he was president, without stating that he must have become indebted through a secret

partnership alleged in the indictment, held erroneous.

 

Evidence in the prosecution of bank president for unlawfully borrowing money through

secret connection with a partnership to which the loan was made, held insufficient to

show that defendant was a partner, and through the partnership became indebted to

the bank.

 

 

Indictment held to sufficiently charge the defendant bank president in a general way with

becoming indebted to the bank, but not to authorize admission of evidence of transactions

showing his indirect liability through membership in a firm to which the loan was made.

 

 

In prosecution of bank president for unlawfully borrowing money from bank, held, that the

court should have limited evidence of subsequent transaction to its effect as tending to

show existence of partnership of which president was a member, declared on in the indictment.

 

 

Permitting the state to withdraw evidence held error, regardless of whether the evidence was

introduced by the state or elicited by accused on cross- examination of the state's witness.

 

In prosecution of bank president for unlawfully borrowing money through a loan made to a

firm of which he was a secret member, held error to instruct on the law of partnership

without applying such law to the facts.

 

 

Error in an instruction in a case wherein accused was convicted required a reversal,

where it was speculative as to what the verdict would have been under a correct instruction.

 

Failure to instruct that defendant should be acquitted of unlawfully borrowing money from

a state bank of which he was president, through his secret membership in a firm, unless

the partnership existed as alleged, held fatal error where the evidence as to the

existence of the partnership was conflicting.

**830 *578 A. A. Lumpkin, of Amarillo, and Cooper & Merrill, of Houston, for appellant.

*579 Martin, Kinder, Russell & Zimmermann, of Plainview, and C. C. McDonald, Asst. Atty.

Gen., for the State.

 

 

DAVIDSON, P. J.

Appellant was convicted of becoming indebted to a state bank, of which he was president,

in the sum of $8,000.

The first count in the indictment sets out the particulars of the transaction relied upon

by the state, but this count was discarded by the court in submitting the case to the

jury, and he submitted only the second count, omitting the third count. The count

submitted charged that appellant was duly elected, qualified, and acting president,

and a member of the board of directors of the First State Bank of Amarillo, a banking

corporation theretofore incorporated and engaged in the business as a state bank in

the city of Amarillo under the authority of the laws of the state, and as said officer

he became indebted to the bank in the sum of $8,000, without the consent of the

majority of the board of directors, and without having the matter duly registered

or inscribed upon the minutes of the bank.

The indictment is attacked in that it fails to apprise the defendant of the nature

and circumstances of the case and wherein he had violated the law. He invokes the

statutory rule, which is settled, that everything necessary to be proved must be

alleged in the indictment. The writer is of opinion this indictment is too general

and does not specifically notify the defendant of the transaction for which he is to

be tried, and that the only allegation in the submitted count is of a very general

nature and to the effect that he became indebted to the bank in the sum of $8,000

without proper authority from the board of directors. The writer is of opinion, w

ithout going into a discussion at any length of the matter, that the count submitted

to the jury is not, within the contemplation of the law, sufficient. The general

allegation that appellant had become indebted to the bank in the sum of $8,000 is

too *580 general. There is a want of particularity about it, and it does not

inform the defendant of what transaction he is charged. There is nothing to describe

the manner of indebtedness, or how it came about, so as to notify defendant of

the matters and transactions that he was to meet by the proof. The first count set

out particularly these different matters and gave appellant notice of how and when

and the circumstances attending the indebtedness, and how it came about, but the

court did not submit this to the jury. This much is said in a general way.

It will be noticed upon investigation of the case that all the facts to be relied

upon by the state were known at the time the indictment was presented, and as to

how the indebtedness was created, if there was any. The facts in this connection, as

relied upon by the state, were made through the testimony of an accomplice, McSpadden.

His testimony, substantially, is that Morris came and notified him of the fact that

he could buy an optional cattle contract, the cattle being in Arizona; that he thought

this option could be bought at $5,000, and if he had the money the trade could be made

and profit made out of it by selling this contract for an enhanced value to other

parties. His object in calling McSpadden was that McSpadden might enable him in some

way to get the money. They discussed it, and McSpadden, not having the money,

suggested they see appellant, who was president of the State Amarillo Bank, and get

him to furnish the money. Appellant was called, and McSpadden's testimony is to

**831 the effect that after discussing it appellant agreed to furnish the money;

Morris and McSpadden signing the note at the bank for $5,000. There was something

said to the effect that it was not probable that the option could be bought at $5,000;

that it might take more money. McSpadden further testified that appellant, Morris, and

himself agreed that Morris and McSpadden were to sign a note to the bank and have the

money transferred to their credit, and that appellant was to be a partner in the

profits and maybe losses, but his name not to be known in the matter, and in this way that

appellant became a partner in the purchase of the cattle option contract. He also testified

that there was no other cattle contract, in contemplation or discussed between them at

the time. His language was:

"Yes, sir; it was agreed that Mike C. Le Master was to advance the money on the condition

that I went along and used what influence I possessed to keep Morris from getting drunk,

and Gus agreed not to get drunk any more, and straighten up. There was nothing said at

that time about any other transaction. We were to do the best we could. We did not know

exactly how much money it would take, but we were to let Mr. Le Master know. We wanted

to get an option on the cattle for spring delivery and then sell the option. The agreement

was that Mr. Le Master was to advance the money to be paid as a forfeit on the cattle

and Morris and myself were to go out there and get a contract and purchase them and

sell the contract."

This occurred on the 26th day of December, and on the 27th a note *581 was executed by

Morris and McSpadden to the bank, appellant's name not appearing in any of these matters.

Upon signing the note Morris and McSpadden left Amarillo and went to El Paso. They there

got in touch with the owners of the cattle and bought the option. The owners of the cattle,

however, required $8,000 instead of $5,000. By wire appellant was notified of that fact. He

took the Morris and McSpadden note and wrote above the 5,000 3,000. The intention it seems

was to make the note for $8,000 instead of $5,000. The deal was made, and in three or four

days the option was transferred at a profit of considerable amount and closed out, and

Morris and McSpadden came back to Amarillo and deposited the money in the state bank at

Amarillo, and on the 6th of January took up and paid off the note. Appellant was not in

Amarillo at the time, but was in Ft. Worth. He knew nothing about the payment of the

note until later information was conveyed to him. Morris testified in many respects as

did McSpadden, but he denied that Le Master had or was to have any interest in the

option contract, and was in no way connected with the profits or losses. In fact, he

was in no sense, or in no way interested in the contract, nor was he to receive any

profits, dividends, or pay any losses. Appellant testified in his own behalf as did

Morris. After returning to Amarillo and taking up the note McSpadden and Morris, without

the knowledge of appellant, went to New Mexico with a view of purchasing other cattle.

Appellant had nothing to do with this and knew nothing of this matter.

[1][2] There were other subsequent cattle deals by McSpadden and Morris which the state

undertook to connect appellant with by McSpadden's testimony. Both Morris and appellant

denied that there was any partnership. There was evidence introduced by the state to

show these subsequent transactions over the protest and objection of appellant. We are

of opinion these objections were well taken. The court also failed to limit this

testimony. Having admitted the testimony, the court should have limited it. It was

not in reference to the original case and could not be, and if it was introduced

for any purpose it was to show that by reason of the subsequent transactions between

the parties that they were partners in the original transaction declared upon in the

indictment. As before stated, we are of opinion these matters should not have gone

before the jury, but having been permitted to be introduced, the court should have

limited them to their proper office in his charge. The state's testimony as well as

that for the defendant all agree that if appellant had any connection with any of

these transactions it was the one based on the note, and the sum finally drawn from

the bank of $8,000, which was paid back within ten days by Morris and McSpadden.

McSpadden says there was no other transaction in contemplation or under discussion.

Morris uses the same language and testifies to the same thing, so does appellant.

So it would be evident that subsequent transactions if entered into independent or

disconnected with *582 the first, not growing out of or related to it in any way,

could not come into the case as testimony on the question of partnership in the

first transaction.

There was nothing said, as McSpadden, Morris, and Le Master all testify, as to any

other trade either then or in contemplation for future dealings. The fact that later

they may have made other trades, or that appellant may have become interested in

later transactions, could not afford testimony proving a partnership in a single

transaction which begun and ended with itself. These latter matters had no relation

to or bearing upon the case; they did not serve to identify or develop the case;

were not res gestae, nor could possibly reach the question of system. The matter

is here dealt with generally without going into details as shown by defendant's

bills of exception with reference to these matters. There are several of these

matters, all of which upon another trial should be excluded.

[3] The state introduced Mr. Mood as a witness, and was proving by him some matters

that occurred on the trial of a civil case in which he took down the testimony as

stenographer. It seems they were seeking **832 to prove the testimony of apellant

while testifying in his own behalf on the trial of the civil case. There are several

pages of these questions and answers set out in the bill so as to make it clear and

plain. It developed in his testimony that on the trial of the civil case appellant

won; that the jury found a verdict in his favor. When the testimony of Mr. Mood was

complete, or they had become satisfied about it, the state moved to exclude all his

testimony from the consideration of the jury. The appellant excepted. The state's

counsel put their motion to withdraw the testimony on the ground that they did not

purpose to introduce the record in the civil case. These matters are generally

stated, and not the details. We are of opinion that the objections of the defendant

were well taken. The testimony should have remained before the jury. Among the

early cases on this question in Texas is Speight v. State, 1 Tex. App. 552. The

first section of the syllabus of that case sufficiently states the question:

"If the accused elicits testimony adverse to himself, he must take the consequences;

and he is not entitled to have it withdrawn from the jury because part of the same

proof, when offered by the prosecution, had previously, on his objection, been

excluded by the court."

In that case the defendant moved to exclude testimony introduced by himself that he

thought adverse to him. The state would occupy no better position under the same

circumstances than would appellant. The testimony, as said in the Speight Case, if

illegal at all, was his own testimony, and we opine he ought to be held to take the

consequences, and could not exclude it simply because it was found to be unfavorable

to his case. In Moore v. State, 6 Tex. App. 563, the question came again. The

headnote of that opinion is as follows:

"If the defendant elicits testimony adverse to himself, he must abide the consequences;

and that a state's witness, upon cross-examination by the defendant, testified to

a confession made after arrest, is not cause for *583 a new trial, as having

improperly gone to the jury."

The doctrine was approved in Allen v. State, 8 Tex. App. 67, and Robins v. State,

9 Tex. App. 671. In the case of McDade v. State, 27 Tex. App. 641, 11 S. W. 672,

11 Am. St. Rep. 216, the question again came. At page 689 of that report (11 S. W. 675)

the court said:

"In the seventh assignment of error it is complained that 'the court failed to

instruct the jury that the declaration of Allchin to Felker that threats had been made

against him by defendant was not any evidence that such threats were made, and that

they should not consider such statement as a part of the evidence for that purpose,

when it was expressly requested so to charge by defendant.' This evidence was drawn

out by defendant upon the direct examination of his witness Felker, and neither the

prosecution nor the court was responsible for it. If the defendant elicits testimony

adverse to himself he must abide the consequences"--citing Speight v. State, 1 Tex.

App. 551, and Moore v. State, 6 Tex. App. 562.

The state having introduced Mr. Mood as a witness, and his testimony being introduced

without objection from the defendant, the state could not, because the testimony

was somewhat damaging to its case, withdraw it from the jury. The state introduced

it and could not withdraw it over objection of appellant. The above cited cases seem

to settle that question.

There are exceptions to the second subdivision of the charge on various grounds. T

his subdivision limits the jury to the second count, and charged if the jury should

find appellant was an officer duly elected, qualified, and acting president and a

member of the board of directors of the state bank, and that the bank was incorporated,

etc., and he became indebted to that bank in the sum of $8,000 without proper authority

from the board of directors, they should convict him. It will be noticed in this connection

that this charge submits the fact that he was president and one of the board of directors.

The indictment, while it mentioned the fact that he was an officer and member of the

board of directors, it did not attempt to charge him with being guilty of violating the

state law as a director, but only as president or acting president. The president cannot

borrow any amount of money from the bank without proper authority. The indictment did

not undertake to charge any matter that would make him criminally liable as a director.

He was charged as the president of the bank, and not as a member of the board of

directors. If he was sought to be convicted as a director, then the charge should

have specifically brought that matter to the attention of the jury.

[4] It will be noticed that this charge does not undertake anywhere to inform the

jury as to the relation of appellant to the amount of money or the circumstances

by which he could have possibly been indebted to the bank. All the testimony and

the indictment excludes the idea that his name was on the bank books. The proof

all shows that it was not, and that there was no contract and no evidence in the

bank books, records, or papers that his name was in any way connected with *584 any

indebtedness to the bank. The only way by which it was sought to hold him liable

was through the testimony of McSpadden that he was a secret partner in the profits

and losses that might arise in the option contract which Morris and McSpadden

accomplished and for which the bank is supposed to have furnished the $8,000. In

order, therefore, to hold appellant guilty, the charge should have conformed to

the facts, and in order to hold him the state would have to show that he was guilty

under the circumstances detailed by the state's witness as partner. In other

words, in order to convict appellant the jury should have been instructed that

they would have to find that appellant became indebted to the bank by means of

this partnership matter **833 about which McSpadden testified. This was the

state's case, and it was all the state had or put into the trial. In this same

connection it may be well enough to notice that section 3 of the charge is a

general statement of the law of partnership as understood by the court in giving

his charge, and it reads as follows:

"A partnership is formed by two or more persons placing their money, effects, labor

and skill or some one or all of them in business with the purpose and intention of

dividing the profit and bearing the loss in certain proportions and may be made and

entered into either by express agreement, oral or written, of those forming the

partnership, or it can result from the conduct of the parties in relation to the

business. Those forming the partnership are partners. When a partnership is formed

each individual partner in relation to partnership business in law binds himself

and each of the other members of the partnership jointly and severally for any

partnership obligations made in furtherance of the partnership enterprise and

within the scope of the partnership business."

[5][6] This is all the charge with reference to partnership. It will be seen that

it has no reference to and is not connected back with the other charge; nor does

the other charge refer to partnership, nor is the jury charged that if appellant

was a partner within the terms of the law with McSpadden and Morris, and under

that partnership there was or could be an indebtedness created for which appellant

would be responsible, they might convict. This definition of partnership is thrown

into it in a general way without any application of the rule of partnership to the

facts in the ease, or facts of the case to the partnership. In the second clause of

the charge which submits the law for conviction the partnership is not mentioned.

Under the facts it was all the state had upon which to predicate a conviction. In

the charge on partnership it does not inform the jury that if appellant connected

himself with this indebtedness by means of this partnership, and was responsible

under the terms of the contract by reason of this partnership, that he might be

liable for the indebtedness, but instructs the jury to convict for the indebtedness

in the second clause, and gives a general definition without any application of the

law to the facts of partnership. If appellant was guilty at all it was under McSpadden's

*585 testimony to the effect that he agreed to divide the profits and losses and carry

the partners under the contract, and that he did furnish the money from the bank.

The state admits error in the charge on partnership as given, but asserts the error

was favorable to appellant. It was error, and we think harmful. The error is conceded;

the verdict was guilty. What may have been the verdict under a correct charge is

speculative, but it is not speculative that he was found guilty.

[7] There is another phase to this charge that is fatal. McSpadden swore to this

partnership as set out in the early part of the opinion. Morris and appellant denied

it emphatically. There was an issue sharply drawn by this testimony as to whether

this partnership existed or not. The bulk and the weight of the testimony was that

the partnership did not exist. The jury so found by their verdict in the civil

proceeding and exonerated appellant as partner and found in his favor in the suit

against himself and Morris by McSpadden. This was shown by the testimony of Mood.

Now the converse of the proposition, had the partnership been properly charged, was

if the jury should find there was no partnership existing between these parties at

the time, they should find in his favor and acquit him. Such omission is fatal error.

[8] It is contended that the evidence is not sufficient to show that appellant was a

partner, and that through the partnership became indebted to the bank. The writer is

of opinion that this proposition is correct. McSpadden testified, and he alone, that

appellant was to be connected with the profits or losses, and Morris testified

positively that such was not the case, and that he and McSpadden alone were

responsible, and that he was to get two-thirds of the profits and McSpadden

one-third, and that appellant had nothing to do with it. McSpadden testified

they were to be equal partners, each getting a third. There were some telegrams

passing between the parties with reference to this $8,000 option contract

introduced by the state, but these did not show that a partnership existed.

It was with reference to the fact that the $5,000 first agreed upon and mentioned

in the note was not sufficient, and appellant agreed to furnish the extra $3,000

from the bank, and later wrote it in the note. The note was payable to the bank,

and appellant was in no way concerned with it, and if he was connected in any

manner with it it was by reason of McSpadden's testimony, which appellant and

Morris both denied. As it occurs to the writer, there is no testimony which

supports or corroborates McSpadden in his statement. If, however, the state

should further prosecute, the testimony should be limited to the transaction

about which the witnesses testified and not extend it to subsequent contracts

in no way connected with or related to the one under investigation.

The judgment is reversed, and the cause remanded.

 

 

*586 On Motion for Rehearing.

[9] On a former day of the term the judgment was reversed and the cause remanded.

The state contends in a motion for rehearing that the court was in error in holding

that the indictment was not valid. It was stated that the general allegation that

appellant had become indebted to the bank in the sum of $8,000 was not specific

enough and entirely too general; that it was wanting in particularity, and failed

to inform the defendant of the transaction, for which he was **834 to be tried. The

writer, upon further investigation, still adheres to his original views. The

majority, however, do not agree with him. Under the view of the majority the

former opinion will be modified and the indictment held sufficient to charge

appellant in a general way with becoming indebted to the bank in the specified

sum. The indictment contained three counts. The first set out the facts attending

the transactions by which it was sought to connect appellant with violating the

banking law, he being president of the bank. That count, however, was not

submitted to the jury by the court, and passed out of the case. The second count

was submitted in which the general allegation was made that appellant became

indebted to the bank of which he was president. Under these allegations the state

would be required to prove that appellant had become directly indebted to the

bank, and that proof of the matters and facts set up by the state in its evidence

would not meet the count upon which the conviction was obtained, which evidence

was to the effect that appellant and McSpadden and Morris entered into an agreement

by which they were to buy cattle and the bank furnish the money, predicated upon a

note given by McSpadden and Morris, and the money transferred on the books of the

bank to their credit, and that appellant would be a partner in the profits and

losses of the cattle transaction for which the note was given to secure funds in

payment of the cattle. Appellant's name does not appear anywhere either in the note

or on the bank books, and on the face of the transaction he is not directly shown to

be connected with any of those matters. In other words, it was a secret partnership,

if it existed. This was perhaps the most serious question in the case so far as the

evidence was concerned. So following the views of the majority, the count will be held

sufficient to charge an offense, but not to admit evidence of the transactions showing

an indirect liability as sought by the state; that this would be a variance between the

allegation in the count submitted and the evidence, and therefore the evidence did not

support the finding of the jury under the count and the charge submitting that count.

In regard to what was said in the original opinion with reference to a bill of exceptions

which contains matters and things set out through the witness Mood, the state contends

that the opinion was *587 in error in holding that state's counsel was responsible for

withdrawing all the testimony of Mood from the jury. The contention is that the state

did not withdraw the statements of Mood on cross-examination by appellant's counsel to

the effect that appellant had won the civil suit. Strictly and technically speaking this

contention may be correct. The bill in regard to this matter shows that when Mood was

placed upon the stand and the various questions asked and answers elicited, he was then

passed to appellant's counsel for cross-examination, and, among other things, it was

elicited from him that appellant had won the civil suit in which McSpadden sued Morris

and himself for settlement of alleged partnership matters, which involved the $8,000

matter. State's counsel objected to this cross-examination as to the matters elicited

from Mood, but the court overruled the objection upon the ground that the state had

drawn out the matter, and this was a legitimate cross-examination. When this occurred

the bill of exceptions recites that:

"Thereupon the state rested, and stated they desired to consult a moment, and within

a few minutes returned to the court, and through their private prosecutor, Mr. Martin,

stated to the court, 'We are not going to introduce any of the record, and we ask that

the court strike out the testimony of Mr. Mood in regard to it.' (The record referred

to being the transcript of what purported to be the statement of facts in the case of

W. A. McSpadden v. R. A. Morris et al., in which the state's counsel had attempted to

prove up by A. M. Mood for the purpose of offering the same and parts thereof to

impeach the defendant as a witness.) The court then stated, 'What part of the record

do you have reference to?' Mr. Martin stated in reply to such question, 'All of Mr.

Mood's testimony identifying the record, since we are not offering any of the record,

that evidence would serve no purpose. We do not intend to offer the record, and we

would like to have this testimony stricken from the record, since it does not tend

to prove any issue in this case."'

 

Thereupon defendant's counsel objected to the withdrawal of any of the testimony by

the state for the reason they had offered the same, and when it was proved harmful

to them they desired to withdraw it, and that it was material and beneficial to the

defendant, and that they had no power to withdraw it when they had offered it

themselves, and they considered it harmful to then be permitted to withdraw it.

The court, not specifically ruling on the objection, turned to the jury and

instructed them as follows:

"I will strike out and instruct the jury not to consider the testimony of Mr. Mood."

In the former opinion the writer was under the impression that, legally speaking, state's

counsel were responsible for being really the moving parties in getting the matter

before the jury as well as to its final withdrawal or exclusion after putting it in

before the jury; that it was too late for the state to withdraw it after

cross-examination of the witness in reference to the matter they had drawn out;

and that their motion, had it been sustained, would practically have operated

to withdraw all the testimony of the witness Mood, *588 whether it was direct

or cross-examination. If the writer was in error about this, then counsel for

the state may not have been altogether responsible for the withdrawal of Mood's

testimony favorable to the defendant. But the matter was so intermingled--

the direct and cross examination taken--with the remarks of the court it occurred

to the writer that the effect **835 of the state's motion was to withdraw all the

testimony, especially in view of the fact that this motion was not made until

after Mood developed the fact that appellant had won the civil suit. This testimony

seems to have been introduced by the state for the purpose of laying some predicate

with reference to the case and the testimony of defendant in the civil suit, but when

Mood testified to the fact that appellant had been eliminated from that record by

the verdict of the jury, counsel moved to exclude or withdraw the testimony from the

jury. State's counsel insist strenuously that they did not undertake to withdraw the

testimony introduced on cross-examination, and that they were only undertaking to

withdraw that which they introduced. Without going into any detail about the matter,

or any discussion, we place it as the record does, so that it will be fully

understood and its effect and result from the whole bill of exceptions may not be

unjust to either side. The result, however, would be the same. This testimony was

withdrawn from the jury, and under the circumstances it should not have been

withdrawn. It is deemed unnecessary to discuss the other matters.

Finding no reason why the motion for rehearing should be granted, it is ordered

that said motion be overruled.

Tex.Crim.App. 1917.

LE MASTER v. STATE.

196 S.W. 829, 81 Tex.Crim. 577

END OF DOCUMENT