People v. De Lay
Before: Paterson
Synopsis
Criminal Law — Embezzlement—Assignment for Benefit of Creditors. — If an assignee for the benefit of creditors fraudulently misappropriates the trust property to the payment of his own claim, when he knows that the terms of the assignment require him first to pay a judgment against the insolvent debtor, or if he fraudulently appropriates the proceeds of sales and collections to his own use, accounting only for a smaller sum, he is guilty of embezzlement. But the question of guilt or innocence does not depend upon the construction of the contract as to the order of payment of creditors. It is the fraudulent misappropriation of the property that constitutes the gist of the offense.
Id. — Offer to Return Embezzled Monets.—The fact that a person charged with embezzlement offers to return or pay over the moneys embezzled is no defense to the accusation.
Id.—Contract of Indemnity—Embezzlement of Trust Funds.'—The fact that an assignee for the benefit of creditors gives a written indemnity to judgment creditors of the assignor, whom he is by the terms of the assignment first to pay out of the proceeds of the trust funds, in no way affects his guilt or innocence when charged with embezzling the funds intrusted to him for certain purposes by the assignor.
Id. —Failure of Assignor to Deliver Property. —The fact that the assignor did not turn over to the assignee for the benefit of creditors all the property assigned is no defense to a charge of embezzling property received and retained.by him.' His only remedy for such failure on the part of the assignor would be to decline to proceed with the trust until the whole of the property was turned over to him; and so long as he retained any property under the contract, he was bound to use it as required by the provisions of the assignment.
Paterson, J. The defendant was charged with embezzlement and convicted. The chief contention of the counsel for appellant is, that the evidence is insufficient to justify the verdict. He obtained possession of the personal property of Mary Furlong under an assignment thereof to him for the benefit of her creditors. By the terms of the assignment defendant was required to apply the proceeds of all sales of property and the revenue received from the dairy and milk route to the payment of Mrs. Furlong’s debts, which were classified in the written assignment and payments thereof required as follows:—
“1. In payment of any judgment that may be recovered by John Reis, plaintiff in an action instituted on the fourteenth day of July, A. D. 1886, wherein the said Reis is plaintiff, and I, the said Furlong, am defendant, etc.
“2. To pay to the said firm of De Lay Brothers whatever amount may be now due to them from me, or that may hereafter become due to them during the running of this agreement.
“3. To pay to R. B. Mitchell such moneys as may be now due to the late firm of Mitchell and Ricketts for fees and costs, etc.
“4. To pay all other unsecured debts that I may now owe, or which may become due from me during the running of this agreement; .... so much of said book-accounts as may remain uncollected, and whatever personal property or book-accounts, notes, demands, . . . . [54]shall be turned over to the said Furlong at the termination thereof; .... the attachment heretofore issued in the case of Reis v. Furlong to be released, the said De Lay indemnifying Matthew Nun an and Jeremiah Lowney, securities on the undertaking for release of attachment this day executed, against any loss by reason of their signing said undertaking as sureties.”
The contract of assignment was executed by both parties on July 21,1886. The defendant thereupon accepted the trust, took possession of all the property that could be found, and began to collect the book-accounts, sell the cows and other stock, and wind up the business. On November 15, 1886, nothing remained to be sold except a few heifers and calves and a grain-wagon. At that time defendant had received about three thousand dollars, and paid out about two thousand nine hundred dollars. Instead of applying the proceeds of the sales and of the business to the payment of the Reis judgment, which had been entered in the mean time against Mrs. Furlong for sixteen hundred dollars and costs, he appropriated the whole thereof—except about eighty-five dollars, which he offered to pay over—to the payment of the debt due himself and partner and a few small claims. In a statement rendered November 15th he gave as the total amount received from sales of milk the sum of $427.15. At the trial it was admitted by his counsel that he had received up to November 5th from sales of milk at least $737.40. The balance—$310.25— not accounted for by him is the amount charged in the indictment as having been embezzled. Tire driver of the milk-wagon testified that there had been collected $120 for which no receipts could be found, in addition to the above-named sum of $737.40.
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