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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 |
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