Petition — Carcaise v. United States

aw Gupreme Court, U,

FILED

MAY 17 1980

HAEL RODAK, JR. CLERN

in the ¥ ;

Supreme Court

of the

United States

‘

. +? Ayam

OCTOBER TERM, 1979

No. 79-1826

FRANK R. CARCAISE,

Petitioner,

VS.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

BRUCE S. ROGOW,

Of Counsel

JOSEFSBERG & TARRE, P.A.

733 City National Bank

25 West Flagler Street

Miami, Florida 33130

Phone: 305/377-8155

Counsel for Petitioner

I,

INDEX

DO THE “STRATEGIC AND

DELIBERATE BY-PASS” THEORIES

OF HENRY v. MISSISSIPPI 379 U.S.

443 (1965) AND FAY v. NOIA 372 U.S.

391 (1963) APPLY TO DIRECT

FEDERAL APPELLATE REVIEW OF A

FEDERAL CRIMINAL CONVICTION?

MAY THE HENRY v. MISSISSIPPI

AND FAY v. NOIA “STRATEGIC AND

DELIBERATE BY-PASS” DOCTRINES

BE INVOKED TO PRECLUDE

JUDICIAL REVIEW OF PLAIN TRIAL

ERROR IN THE ABSENCE OF ANY

FACTUAL DETERMINATION

REGARDING THE REASONS WHY

COUNSEL FAILED TO OBJECT AT

BROT bi eo edaneck iiabasivnPinbiie sss.

MAY THE HENRY v. MISSISSIPPI

AND FAY v. NOIA “STRATEGIC AND

DELIBERATE BY-PASS” DOCTRINES

BE INVOKED TO PRECLUDE

JUDICIAL REVIEW OF PLAIN TRIAL

INDEX (Continued)

Page

ERROR WHERE THE TRIAL COURT

WAS AWARE OF THE POTENTIAL

EAM GPE PUNUB LOT cocci ccccccccccsecas 3

STATEMENT OF THE CASE ................0.- 3

REASONS FOR GRANTING THE WRIT ........ 6

THE DECISION BELOW IS NOT IN

ACCORD WITH PRIOR DECISIONS OF

THIS COURT AND IT PRESENTS AN

IMPORTANT QUESTION OF FEDERAL

LAW WHICH HAS NOT BEEN, BUT

SHOULD BE SETTLED BY THISCOURT. . 6°

A. The Inappropriate Use of Henry v.

Mississippi and Fay v. Noia ........... 7

B. The Erroneous Application of the

Henry-Fay Theories ...........ceeee0% 8

C. Henry and Fay Do Not Apply Where the

Trial Court Has Been Contempo-

raneously Made Aware of the Error .... 9

ce IRIS SEG ESS ern pe ee 10

CERTIFICATE OF SERVICE ................005: 11

ii

in the

Supreme Court

of the

United States

OCTOBER TERM, 1979

NO.

FRANK R. CARCAISE,

Petitioner,

US.

UNITED STATES OF AMERICA,

Respondent.

PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

OPINION BELOW

The opinion of the Court of Appeals is attached to

this Petition as an Appendix. The decision is reported:

United States v. Habel and Carcaise, 613 F.2d 1321 (5th

Cir. 1980). This application is filed on behalf of Mr.

Carcaise.

JURISDICTION

The judgment of the Court of Appeals was entered

on March 19, 1980. A petition for rehearing was denied

on April 17, 1980, but an order granting a stay of the

mandate was entered, conditioned upon the timely

filing of a petition for writ of certiorari. This petition is

timely filed. Jurisdiction is invoked pursuant to Title 28

U.S.C. §1254(1).

QUESTIONS PRESENTED

I,

DO THE “STRATEGIC AND DELIBERATE BY-

PASS” THEORIES OF HENRY v. MISSISSIPPI

379 U.S. 443 (1965) AND FAY v. NOIA 372 US. 391

(1963) APPLY TO DIRECT FEDERAL

APPELLATE REVIEW OF A FEDERAL

CRIMINAL CONVICTION?

Il.

MAY THE HENRY v. MISSISSIPPI AND

FAY v. NOIA ‘“‘STRATEGIC AND

DELIBERATE BY-PASS” DOCTRINES BE

INVOKED TO PRECLUDE JUDICIAL

REVIEW OF PLAIN TRIAL ERROR IN THE

ABSENCE OF ANY FACTUAL

DETERMINATION REGARDING THE

REASONS WHY COUNSEL FAILED TO

OBJECT AT TRIAL?

ITI.

MAY THE HENRY v. MISSISSIPPI AND

FAY v. NOIA ‘‘STRATEGIC AND

DELIBERATE BY-PASS” DOCTRINES BE

INVOKED TO PRECLUDE JUDICIAL

REVIEW OF PLAIN TRIAL ERROR WHERE

THE TRIAL COURT WAS AWARE OF THE

POTENTIAL LOSS OF RIGHTS?

STATEMENT OF THE CASE

Frank Carcaise was convicted of multiple counts of

mail fraud, and one count of conspiracy to commit mail

fraud, after a jury trial in the United States District

Court for the Middle District of Florida. He was

sentenced to seven years imprisonment.

The prosecution of Mr. Carcaise was based upon

the government’s allegations that he and several other

co-defendants, fraudulently obtained money from

investors for a proposed real estate development in

Volusia County, Florida called The Swallows. The fraud

occurred by virtue of misrepresentations made by a

number of mortgage brokers, who allegedly were acting

as agents of the defendants. The misrepresentations

included, inter alia, that the investors would receive a

first mortgage, that the mortgage would be on a

proposed plotted lot in The Swallows, and that the

moneys invested would be used exclusively for the

development of The Swallows.

An important witness in the government’s case was

Carol Wollesen, Mr. Carcaise’s personal secretary. Her

“direct examination was indeed damaging to Carcaise”’

because she identified incriminating documents,

recalled incriminating telephone conversations, and

testified regarding checks which “documented his

involvement in a sordid relationship [with a woman].”

613 F.2d at 1326.

Cross examination of Ms. Wollesen by Carcaise’s

lawyer was perfunctory (T. 1902 et seq.). However,

counsel for a co-defendant, Mr. Stepanian, called for a

bench conference before beginning his cross-

examination of Ms. Wollesen. He told the trial judge:

.. . that he intended to ask Ms. Wollesen

whether she had previously stated that

Carcaise kept a mistress, had a drinking

problem, : ad a homosexual relationship with

Stepanian, beat his wife, mistreated his

children, had threatened her with violence

when she left her job, and had bribed the

federal judge presiding in a previous criminal

prosecution. Ms. Wollesen had made most of

these allegations during the course of a

deposition previously taken by Carcaise’s

attorney. The judge asked Stepanian’s counsel

whether he had evidence that Ms. Wollesen

had made these accusations, and he said he

did, referring to the deposition.

613 F.2d at 1326

Mr. Carcaise’s attorney objected successfully to the

bribery testimony, but did not seek to entirely exclude

the other damaging Wollesen cross examination

J

testimony. 613 F.2d 1326, n.1. The cross examination

was permitted.

In her testimony, Ms. Wollesen admitted she had

sworn Mr. Carcaise “‘beat his wife and kept a mistress”;

that he threatened her with “physical harm’; that

others had suggested Mr. Carcaise had “homosexual

relationships” and that “when he was home he was

drunk and it was ‘shut up and get out of my way.’ ” 613

F.2d at 1327.

The Court of Appeals refused to consider the

impact of Ms. Wollesen’s cross examination testimony

upon Mr. Carcaise’s right to a fair trial, saying:

It is apparent that Carcaise’s attorney chose to

forego objections for tactical reasons. Counsel

for Carcaise was attentive throughout trial,

and we may assume he concluded, as did

Stepanian’s lawyer, that the injurious impact

of the repetition of the contents of Ms.

Wollesen’s deposition would be outweighed by

its value as evidence of her bias against

Carcaise. We cannot know whether his

judgment was correct, but, unfortunately for

him, we know the jury accepted the

government’s version of the facts. When a

lawyer, for strategic reasons, chooses to by-pass

the appropriate procedures for informing the

trial court of contemporaneous errors, he will

not be heard to complain when his strategy

backfires. Henry v. Mississippi, 379 U.S. 443,

450, 85 S.Ct. 564, 568, 13 L.Ed.2d 408, 414

(1965); Fay v. Noia, 372 U.S. 391, 83 S.Ct. 822,

9 L.Ed.2d 837, 869 (1963). This is especially

true where the strategy is to remain quiet

during the trial in hope of a favorable verdict,

but, when that fails to materialize, to resort “to

appeal on errors that might have easily been

corrected by objection at trial.’’ United States

v. Jacquillon, 469 F.2d 380, 386 (5th Cir. 1972),

cert. denied, 410 U.S. 988, 93 S.Ct. 1400, 35

L.Ed.2d 604 (1973); United States v. Sisto, 534

F.2d 616 (5th Cir. 1976); United States v.

Crockett, 534 F.2d 589 (5th Cir. 1976).

613 F.2d at 1327-1328

This Petition raises issues relating to the Court of

Appeal’s use of the Henry v. Mississippi and Fay v. Noia

doctrines to preclude review of Mr. Carcaise’s claim that

the admission of Ms. Wollesen’s scandalous testimony

denied him his right to a fair trial.

REASONS FOR GRANTING THE WRIT

THE DECISION BELOW IS NOT IN

ACCORD WITH PRIOR DECISIONS OF

THIS COURT AND IT PRESENTS AN

IMPORTANT QUESTION OF FEDERAL

LAW WHICH HAS NOT BEEN, BUT

SHOULD BE SETTLED BY THIS COURT.

The Court of Appeals did three things when it

refused to consider the damaging effect of Ms.

Wollesen’s testimony. First, it applied the Henry uv.

Mississippi, 379 U.S. 443 (1965) and Fay v. Noia, 372

U.S. 391 (1963) strategic and deliberate by-pass theories

to direct federal appellate review of a federal criminal

conviction.

6

Second, the Court of Appeals applied those

doctrines in a way which precluded any subsequent

factual determination regarding the reasons why

counsel failed to object at trial.

Third, the Court invoked the “strategic and

deliberate by-pass” doctrines and precluded judicial

review in a case where the trial court was aware of the

potential loss of rights.

The appellate court’s use of Henry and Fay in those

circumstances was novel and not consistent with the

principles of those cases. While this Court has dealt with

Henry-Fay theories in the context of federal collateral

attacks upon a federal conviction, Kaufman v. United

States, 394 U.S. 217 (1969) and Davis v. United States,

411 U.S. 233 (1973), it has not utilized the Henry-Fay

doctrines to accomplish what the Court of Appeals did

in this case.

A. The Inappropriate Use of Henry v. Mississippi and

Fay v. Noia

Henry v. Mississippi raised the issue of bypass in

the context of direct Supreme Court review of “state

court judgments which rest on independent and

adequate state grounds.” 379 U.S. at 446. Fay v. Noia,

and its sequel Wainwright v. Sykes, 433 U.S. 72 (1977),

raised the issue of bypass in the context of the

availability of federal habeas corpus review of a state

court judgment where there has been a state procedural

default.

The Court of Appeals invoked Henry and Fay to

preclude direct federal appellate review of a federal

7

conviction, a proposition which rests on principles quite

different from those involved in Henry, Fay and Sykes.

The principles of federalism and the limitations

imposed upon the jurisdiction of federal courts may

provide the basis for utilizing Henry and Fay when the

issue is review of a state court judgment. But those

principles should not foreclose review of a plain error

committed during the course of a federal trial.

B. The Erroneous Application of the Henry-Fay

Theories —

Even if Henry and Fay are applicable, the Court of

Appeals misused their theories. The lower court

assumed Mr. Carcaise’s lawyer ‘‘chose to forego

objections for tactical reasons.” 613 F.2d at 1327. In

Henry, this Court, suspecting a “strategic move’, 379

U.S. at 451, remanded for a factual finding saying ‘‘only

evidence extrinsic to the record before us can establish

the fact of waiver. . .”. 379 U.S. at 452.

In Fay, this Court held that federal habeas relief

could be denied if it was found that the applicant

“deliberately by-passed the orderly procedure of the

state courts. . .” 372 U.S. at 438. That finding required

a determination “. .. of the facts bearing on the

applicant’s default.”’ 372 U.S. at 439.

Even Wainwright v. Sykes, while rejecting the wide

sweep of Fay, adopted a “‘cause and prejudice’”’ test

which leaves open the opportunity for a later factual

determination. 433 U.S. at 87.

The Court of Appeals in this case, by assuming a

strategic and deliberate by-pass without any evidentiary

basis, and then precluding judicial review of the

allegedly by-passed issue, has misapplied Henry, Fay

and Sykes, and is in conflict with those cases.

C. Henry and Fay Do Not Apply Where the Trial

Court Has Been Contemporaneously Made

Aware of the Error

In Henry, the trial judge was not

contemporaneously made aware of defense counsel’s

failure to object. In Fay, there is nothing to suggest that

the trial judge had some role in effectuating Noia’s

decision not to appeal.

In this case, a co-defendant’s lawyer raised the

potential for harm to Mr. Carcaise as a result of his

forthcoming cross examination of a prosecution witness.

Applying the Henry-Fay principles to foreclose

federal appellate review of evidence which a federal trial

judge knew would taint a conviction is inconsistent with

the holdings of those cases since the trial judges in

Henry and Fay were unaware of the defendants’

impending loss of rights.

CONCLUSION

The decision below is not in accord with prior

decisions of this Court and misapplies the principles of

important decisions of this Court.

Whether a federal appellate court can apply

“strategic-by-pass” theories to trial errors and then

foreclose any opportunity to controvert the appellate

factual finding of by-pass has not been addressed by this

Court. It should be. Certiorari should be granted.

Respectfully submitted,

BRUCE S. ROGOW, Of Counsel

JOSEFSBERG & TARRE, P.A.

733 City National Bank

25 West Flagler Street

Miami, Florida 33130

Phone: 305/377-8155

Counsel for Petitioner

10

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that three copies of the

foregoing Petition for Writ of Certiorari were mailed to

the HONORABLE WADE H. McCREE, JR., Solicitor

General of the United States, Department of Justice,

Washington, D.C. 20530, 1 copy to STEPHEN

LEARNED, ESQ., Fraud Section, Criminal Division,

U.S. Department of Justice, c/o Benjamin Franklin

Station, P.O. Box 136, Washington, D.C. 20044, this

day of May, 1980.

11

APPENDIX

UNITED STATES of America,

Plaintiff-Appellee,

VU.

R. William HABEL and Frank R. Carcaise,

Defendants-Appellants.

No. 78-5606.

United States Court of Appeais,

Fifth Circuit.

March 19, 1980.

Defendants were convicted before the United States

District Court for the Middle District of Florida at

Orlando, John A. Reed, Jr., J., of mail fraud and

conspiracy, and they appealed. The Court of Appeals,

Henderson, Circuit Judge, held that: (1) evidence,

which showed that one defendant was closely connected

with mailing of false letters to investors and from which

jury could well have concluded that defendant sent

letters as part of scheme to defraud, was sufficient to

support his conviction; (2) exclusion of evidence offered

to show that other defendant intended to complete

residential development was not error nor was rejection

of expert testimony that year in question was bad year

for real estate developers; (3) neither admission of

testimony of one defendant’s former personal secretary

nor failure to grant severance or issue limiting

instruction constituted plain error; and (4) charge,

/

A-1

which told jury that defendants were not guilty unless

they knowingly and intentionally attempted to deceive

another, was fair.

Affirmed.

Appeals from the United States District Court for

the Middle District of Florida.

Before CHARLES CLARK, RONEY and

HENDERSON, Circuit Judges.

HENDERSON, Circuit Judge.

In June, 1972, LTP Properties (LTP) began a

Florida residential development called ‘‘the Swallows’’.

LTP obtained most of the funds for the project from

investors contacted through SEI, Inc. (SEI), a mortgage

brokerage company. Appellant Carcaise was president

of LTP, Gateway Consultants Inc., and Foxview Golf

and Country Club until May 1, 1973, when Carcaise

became chairman of the board of directors of each and

hired appellant Habel as president.

In February, 1973, Carcaise furnished to SEI sales

materials indicating that all money received from

investors would be used to develop the Swallows. The

investors, most of whom were elderly or disabled,

bought promissory notes purportedly secured by first

mortgages on residential lots (in fact 85% of the lots

were encumbered by prior liens, mortgages or leases).

Approximately five hundred investors purchased

$6,250,000 of LTP securities, and they were told their

mortgages were “free, clear and unencumbered’’ for

residential lots, with streets and sewers provided. In

reality, the assigned lots covered LTP’s entire tract,

with nothing retained for roads and sewers, and many

lots were located under water or on the sites of a sewage

treatment plant and a proposed golf course. The notes

and deeds the investors received were signed by either

Carcaise or Habel. The notes yielded one percent

interest per month. No interest was paid after

November, 1974.

At first LTP used investor funds to release a bank

mortgage on a given lot so that an investor’s mortgages

could be cleanly recorded, but after January, 1974, LTP

no longer secured releases prior to recording investor

mortgages. Subsequently LTP recorded almost three

hundred “subordinate first mortgages.”’

County authorities did not approve a development

plat for the Swallows, so substantial development never

commenced. Most invested funds went toward the

construction of the Foxview Club in Pennsylvania, or to

the salaries of Carcaise and Habel, and only about one-

quarter of the funds disbursed were used to develop the

Swallows.

On January 23, 1974 Carcaise wrote to Habel and

discussed switching the investor mortgages from the

useless grid-parcels to proposed residential lots

(allowing for streets, etc.). Letters signed by Habel, were

mailed to investors asking them to return their

mortgages so they could be “re-recorded” (hence “‘the

re-record letters”). The letters contained maps with

particular lots circled and labeled “this is your lot.” In

fact, no re-recording ever occurred. In March and April,

A-3

1974, apology letters, also signed by Habel, were sent to

the investors, wherein the delay in sending the new

mortgages was falsely attributed to the press of other

work. In September, 1974, LTP issued a “Swallows

Newsletter,” which had been prepared by a public

relations firm from information provided by Carcaise

and Habel. The newsletter misled investors by stating

that condominium construction was expected to begin

presently.

In the spring of 1974, Carcaise told an assistant that

he was worried that Habel might report the scheme to

law enforcement authorities. Soon thereafter Habel

resigned, although he continued to receive his salary

until October, 1974. There was evidence that Carcaise

continued to pay Habel in order to keep him quiet, but

Habel maintains he had a right to the salary under his

employment contract. Other employees testified that

Carcaise had told them not to discuss company business

with Habel without first obtaining his approval.

Carcaise was convicted of 35 counts of mail fraud

(18 U.S.C.A. §1341) and one count of conspiracy (18

U.S.C.A. §371). Habel was convicted of conspiracy and

fifteen counts of mail fraud, all the substantive counts

stemming from the re-record and apology letters.

Habel urges that the evidence adduced at his trial

was insufficient to support his convictions. We have

examined all the evidence and find that it was sufficient

to support each part of the verdict, and we affirm his

convictions.

[1] In reaching our conclusion, we have considered

the evidence in the light most favorable to the

A-4

government, Glasser v. United States, 315 U.S. 60, 62

S.Ct. 457, 86 L.Ed. 680 (1942), with all reasonable

inferences supporting the verdict accepted as true,

United States v. Wentland, 582 F.2d 1022 (5th Cir.

1978), cert. denied, 439 U.S. 1133, 99 S.Ct. 1056, 59

L.Ed.2d 96 (1979); United States v. James, 576 F.2d

1121 (5th Cir. 1978), cert. denied, ___. U.S. _____ , 99

S.Ct. 2836, 61 L.Ed.2d 283 (1979); United States v. Parr,

516 F.2d 458 (5th Cir. 1975). The standard by which we

review the sufficiency of the evidence supporting a

criminal conviction is found in United States v. Littrell,

574 F.2d 828 (5th Cir.), “{O]Jur inquiry is whether the

jury could reasonably, logically, and legally infer from

the evidence presented that [the defendant] was guilty

beyond a reasonable doubt.. . . Put another way, could

the jury reasonably find that the evidence was

inconsistent with every hypothesis of innocence?. . .A

third formulation is whether the jury ‘could not

reasonably conclude that the evidence fails to exclude

every reasonable hypothesis but that of guilt.’” 574

F.2d at 832, and n.3.

[2,3] In order to prove violations of the

substantive counts, the government was required to

show that Habel, in furtherance of a scheme to defraud,

mailed letters knowing they contained untrue

statements. United States v. Amrep, 560 F.2d 539 (2d

Cir. 1977), cert. denied, 434 U.S. 1015, 98 S.Ct. 731, 54

L.Ed.2d 759 (1978); United States v. LaFerriere, 546

F.2d 182 (5th Cir. 1977). As the brief summary above

shows, there was ample evidence that Habel was closely

connected with the mailing of the re-record and apology

letters, which were for all purposes, entirely false. The

jury could well have concluded that Habel sent the

A-5

letters as part of a scheme to defraud. Similarly, there

was sufficient evidence to show a conspiracy existed,

and that Habel knowing and freely joined it. While a

person is not guilty of conspiracy simply because he

knows a conspirator, there was substantial evidence,

some of it direct, that Habel took part in the conspiracy.

It was for the jury, of course, to decide what testimony to

believe and what to reject.

[4] This analysis is adequate to a conventional

attack on the sufficiency of the evidence, but Habel’s

argument is not conventional — in fact it is difficult to

divine what his argument is. At the trial, the district

judge granted a directed judgment of acquittal as to

other defendants, and Habel complains it would be

unjust to sustain his convictions on the same counts.

However, even if there are circumstances in which a

directed verdict as to some defendants will require the

same treatment for others, Habel’s argument depends

upon the truth of his assertion that he was no more

involved with the apology and re-record letters than

were the dismissed defendants. He signed these letters

though, and it was properly left to the jury to decide

whether his involvement fell to the level of guilt.

[5] Habel also insists that the re-record and

apology letters do not conclusively establish guilt. He

reasons that the evidence “simply demonstrated that

Mr. Habel forwarded, over his signature, [the re-record

and apology] letters which had been prepared by others

within the corporation,” and that “[h]ad these letters

been part of a scheme to defraud, there would have been

no letters because as long as the investors continued to

receive their one percent interests per month, as they

A-6

were receiving at the time these letters were written,

there would be no reason for the investors to become

concerned and no reason for lulling.”” The mailing of

letters “designed to lull [victims] into a false sense of

security, [and to] postpone inquiries or complaints”

constitutes mail fraud. United States v. Ashdown, 509

F.2d 793, 800 (5th Cir.), cert. denied, 423 U.S. 829, 96

S.Ct. 48, 46 L.Ed.2d 47 (1975). While the jury might

have accepted Habel’s argument, it is no surprise that it

did not; “the evidence shows that at the time the re-

recording letters went out, the investors’ security was

worthless. Thus, the scheme could continue only as long

as the investors were lulled into believing otherwise and

prevented from warning other investors.” Brief for

Appellee at 42 n. 14. We do not reverse a conviction

merely because the jury rejected counsel’s rather weak

assertions.

We now turn to the case of Carcaise, who concedes

the evidence against him was sufficient to support his

convictions but urges that errors in the conduct of the

trial require reversal. His contentions are without merit,

and we affirm.

[6] First, the exclusion of certain evidence offered

to show Carcaise intended to complete the Swallows was

not an error, nor was the rejection of expert testimony

that 1974 was a bad year for real estate developers.

The government did not contend that Carcaise

intended to abandon the Swallows, but rather that

Carcaise knowingly misrepresented material facts to his

investors, thereby causing them injury. In closing

argument, the prosecutor went so far as to say “[i]t is

not charged in the indictment, and at no point in the

government’s case did we try to suggest to you or

through the evidence that the defendants did not intend

to build the Swallows.” Carcaise asks us to find, from a

selective examination of the indictment, that the

government alleged he never intended to complete the

project, but a fair reading shows this is not the case.

Carcaise admits that proof that he intended to

complete the venture would not excuse knowing

misrepresentations to investors. United States uv.

Diamond, 430 F.2d 688 (5th Cir. 1970). He only says the

testimony might have convinced the jury of his good

faith. The court instructed the jury that Carcaise’s good

faith intention to complete the project, while not a

complete defense, could be considered on the question of

his intent to defraud. Carcaise was permitted to

introduce some evidence of his intent to complete the

project, such as testimony about his attempts to obtain

financing for the project.

[7] The trial judge excluded the testimony of Dr.

Halbert Smith, who would have testified that the

interest rate offered on the notes was not high in view of

the circumstances of the development, and that in 1974

interest rates rose and housing demand feil, resulting in

the failure of many real estate developments. The

testimony was properly rejected, since it was not

relevant, and might have confused the jury. Although

Dr. Smith was qualified to explain the effect of the 1974

recession on the housing industry in general, his

proffered testimony did not indicate that he had

anything to say about the effect of the recession on the

Swallows project in particular.

[8] Carol Wollesen was personal secretary to

Carcaise from December, 1973, until February, 1975.

Carcaise claims that he was injured by a co-defendant’s

cross examination of Ms. Wollesen, who was a

government witness. Ms. Wollesen’s testimony on direct

examination was indeed damaging to Carcaise. She

identified numerous incriminating documents, and

recalled telephone conversations implicating Carcaise

and others. She testified that Carcaise told her to

destroy certain records he wanted to keep from

Securities and Exchange Commission investigators, as

well as checks that documented his involvement in a

sordid relationship. She further stated that Carcaise

threatened he would get even if she ever testified against

him,

After cross-examination by attorneys for several co-

defendants, including Carcaise, counsel for defendant

Stepanian requested a bench conference. (The court

subsequently entered a judgment of acquittal for

Stepanian.) Outside the presence of the jury and Ms.

Wollesen, Stepanian’s counsel said “Your Honor, |

propose to examine this lady for purposes of attacking

her credibility showing she had such a deep hatred for

Frank Carcaise that she will say anything in order to

make trouble for him,”’ and, hence, for Stepanian. He

told the trial judge, in the presence of Carcaise’s

attorney, that he intended to ask Ms. Wollesen whether

she had previously stated that Carcaise kept a misiress,

had a drinking problem, had a homosexual relationship

with Stepanian, beat his wife, mistreated his children,

had threatened her with violence when she left her job,

and had bribed the federal judge presiding in a previous

criminal prosecution. Ms. Wollesen had made most of

these allegations during the course of a deposition

previously taken by Carcaise’s attorney. The judge

asked Stepanian’s counsel whether he had evidence that

Ms. Wollesen had made these accusations, and he said

he did, referring to the deposition.

Only the prosecutor asked the judge to rule out

entirely this cross-examination. He contended there was

insufficient

predicate for cross-examining anybody until

you show that she has somehow adopted that

statement [about homosexuality] or until you

can show that she made that statement. I think

that is probably true of a very wide range of

matters to which Mr. Dittmar has alluded. I

would further tender to the Court there is

absolutely no showing at this point that this

woman has animus of that nature for Frank

Carcaise or any showing whatsoever that spills

over to anybody else.

The prosecutor further insisted that while Ms.

Wollesen’s testimony was damaging to all defendants, it

was purportedly based on statements made by Carcaise,

and he suggested that if she was motivated by ill-will

she would have attributed fabricated statements to

Stepanian and the other defendants. He concluded by

saying ‘‘[t]hat is just not the nature of her testimony. If

Your Honor wants some kind of proffer I think we can

show by and large these aren’t her statements.”

Following this objection from the government, the

lead counsel for Carcaise asked to make “one brief

A-10

comment.” He then said that mention of the earlier

federal trial in Atlanta would be unduly damaging and

of only limited relevance.! The court then instructed

'Carcaise’s appellate counsel maintains that the trial lawyer

made the same argument that he makes here, but this is not true.

The only objection at the trial was on the bribery allegation, and

that objection was sustained. We include excerpts from the

transcript, quoting in full counsel’s objection.

““May I make one brief comment? .. . And that is

simply this, I think the grounds that have been previously

advanced by the various parties that have moved for

severance, and in particular Mr. Stepanian, was on the

ground, vis-a-vis, of inconsistent defenses.

“I don’t challenge for one minute his right to challenge

by all available means within the limits of propriety the

credibility of this witness.

“On the other hand, though, I don’t think that going

into the issue of the Georgia trial is something that

properly can be utilized to test her credibility because it

injects this prejudicial material about Mr. Carcaise that is

not even relevant in the first instance. So, I don’t think it

is admissible and it can’t be used to test her credibility.

“T think that, from what I see, and it goes without

saying, that Mr. Stepanian through his attorney, Mr.

Dittmar, they want a severance in the worst way, and I

think that if this is what it is being offered for, then, I

think it misses the mark of inconsistent defenses which is

what has been stated before.

“And I just would point out to the court that I would like

to have some assurance that the questions propounded

along the lines of the Georgia case, regardless of the facts

of the acquittal or the speculation of the witnesses about

how it was obtained, that those areas not be allowed to be

inquired into.”

Transcript at 1992-93.

A-11

Stepanian’s attorney not to discuss the acquittal in

Atlanta, saying “I don’t think that is sufficiently

probative of credibility that it is worth the detriment to

Mr. Carcaise.”’ The trial judge then said he would not

otherwise restrict cross-examination, but would address

objections to specific questions when raised.

Under cross-examination, Ms. Wollesen denied any

animosity toward Carcaise, but admitted that during

her deposition she had said Carcaise ‘“‘was never home.

When he was home he was drunk and it was ‘shut up

and get out of my way.’ He never had a good word to say

to [his children].” She admitted she had sworn that

Carcaise beat his wife and kept a mistress. When asked

‘‘Have you stated that Mr. Carcaise threatened you with

physical harm when you quit?”, she answered “Yes, he

did.” Stepanian’s lawyer then asked “You stated all

these things yet you say you bear no animosity towards

him?”, and she responded “I bear no animosity towards

him, that is not animosity, that is the truth.” She

subsequently answered that she had never said she

suspected Carcaise of having homosexual relationships,

but that someone else had suggested this to her.

Carcaise now complains that the cross-examination

testimony was so scandalous his convictions are invalid,

or, alternatively, that the trial judge erred in failing to

grant a severance, or at least an instruction as to the

limited purpose of the testimony.

[9] Since Carcaise’s single objection was

sustained, his convictions should be affirmed unless Ms.

Wollesen’s testimony so prejudiced him that its

admission constituted plain error. F.R.Crim.P. 51, 52.

A-12

ce nk tS a i ce

Plain error will be found only in exceptional

circumstances, United States v. King, 505 F.2d 602 (5th

Cir. 1974), especially when a timely objection would

have enabled the trial court to prevent an injustice,

Fallen v. United States, 343 F.2d 844, 846 (5th Cir.

1965); cf. United States v. Garber, 471 F.2d 212 (5th Cir.

1972). We determine that neither the admission of Ms.

Wollesen’s testimony nor the district court’s failure to

grant a severance or issue a limiting instruction

constitutes plain error.

[10] It is apparent that Carcaise’s attorney chose

to forego objections for tactical reasons. Counsel for

Carcaise was attentive throughout trial, and we may

assume he concluded, as did Stepanian’s lawyer, that

the injurious impact of the repetition of the contents of

Ms. Wollesen’s deposition would be outweighed by its

value as evidence of her bias against Carcaise.2 We

cannot know whether his judgment was correct, but,

unfortunately for him, we know the jury accepted the

government’s version of the facts. When a lawyer, for

strategic reasons, chooses to by-pass the appropriate

procedures for informing the trial court of

contemporaneous errors, he will not be heard to

complain when his strategy backfires. Henry v.

Mississippi, 379 U.S. 448, 450, 85 S.Ct. 564, 568, 13

L.Ed.2d 408, 414 (1965); Fay v. Noia, 372 U.S. 391, 83

S.Ct. 822, 9 L.Ed.2d 837, 869 (1963). This is especially

true where the strategy is to remain quiet during the

trial in hope of a favorable verdict, but, when that fails

to materialize, to resort ‘‘to appeal on errors that might

The jury had already heard testimony that Carcaise kept a

mistress. Stepanian’s counsel risked having Wollesen testify that

she had previously said Carcaise and Stepanian were having a

homosexual relationship.

A-13

have easily been corrected by objection at trial.’’ United

States v. Jacquillon, 469 F.2d 380, 386 (5th Cir. 1972),

cert. denied, 410 U.S. 938, 93 S.Ct. 1400, 35 L.Ed.2d 604

(1973); United States v. Sisto, 534 F.2d 616 (5th Cir.

1976); United States v. Crockett, 534 F.2d 589 (5th Cir.

1976).

Similarly, when Carcaise’s counsel objected to

cross-examination about the previous Atlanta

prosecution, he indicated severance would be

inappropriate, and he cannot argue otherwise now. See

note 1, supra. Nor did he request a curative instruction,

and the trial court was entitled to conclude that

Carcaise did not want to draw attention to the

testimony. United States v. Avarello, 592 F.2d 1339,

1346 (5th Cir. 1979), U.S. appeal pending; United States

v. Kohne, 358 F.Supp. 1053, 1062 (W.D.Pa. 1973),

affirmed, 485 F.2d 682, 487 F.2d 1395, cert. denied, 417

U.S. 918, 94 S.Ct. 2624, 41 L.Ed.2d 224 (1974), United

States v. Stallings, 273 F.2d 740, 741 (2d Cir. 1960).

[11] Finally, Carcaise objects to the jury charge.

Throughout trial he insisted that he was confident that

the Swallows would succeed. The jury was instructed

that good faith was relevant to guilt or innocence, but

would not “justify false or reckless representations or

promises.” While we would hesitate to uphold the

imposition of criminal sanctions for mere recklessness,

this is a correct instruction. United States v. England,

480 F.2d 1266, 1269 (5th Cir.), cert. denied, 414 U.S.

1041, 94 S.Ct. 543, 38 L.Ed.2d 332 (1973); United States

v. Frick, 588 F.2d 531, 536 (5th Cir. 1979), cert. denied,

441 U.S. 913, 99 S.Ct. 2013, 60 L.Ed.2d 385 (1979).

Reviewing the charge as a whole, we find it fair; the jury

A-14

was told the defendants were not guilty unless they

“knowingly and intentionally attempted to deceive

another.”

[12] Carcaise was convicted on several counts

because he had represented that he was selling first

mortgages, when in fact, this was untrue. The trial! court

excluded expert testimony on the Florida law of

mortgages, and instructed the jury on the meaning,

under Florida law, of the terms “mortgage,” “first

mortgage,” “lien” and “encumbrance.” The judge then

quoted a portion of the mortgage that Carcaise mailed

investors,?> and said that such language was a

representation that it was a first mortgage and that

there were no other encumbrances. Since this was an

accurate statement of the law, the instruction was free

from error.

The convictions are AFFIRMiD.

‘This portion of the instruction, which follows, quotes the

mortgages: ‘‘Mortgagor hereby covenants that mortgagor is well

and truly ceased [sic] of a good and perfect title to the premises

above conveyed in the law, in fee simple, and has good rights and

lawful authority to convey the same, and that the title so conveyed

is clear, free and unencumbered and the mortgagor will forever

warrant and defend the same to mortgagee against all claims

whatsoever.”

oo

A-15

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

NO. 78-5606

UNITED STATES OF AMERICA,

Plaintiff-Appellee,

versus

R. WILLIAM HABEL, and

FRANK R. CARCAISE,

Defendants-Appellants.

Appeals from the United States District Court

for the Middle District of Florida

ON PETITION FOR REHEARING

(April 17, 1980)

Before CHARLES CLARK, RONEY and

HENDERSON, Circuit Judges.

PER CURIAM:

IT IS ORDERED that the petition for rehearing

filed on behalf of Frank R. Carcaise in the above entitled

and numbered cause be and the same is hereby denied.

ENTERED FOR 1-.E COURT:

/s/ ALBERT J. HENDERSON

United States Circuit Judge

A-16