Opposition Brief — Turner v. United States

Inthe Supreme court of the Wnited States

OcrToBER TERM, 1955

No. 169

EK. V. TURNER, PETITIONER

v.

UNITED StTaTEs oF AMERICA

I. C. TURNER, PETITIONER

v.

UNITED StTaTEs oF AMERICA

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR THE

FOURTH CIRCUIT

BRIEF FOR THE UNITED STATES IN OPPOSITION

OPINIONS BELOW

The order of the District Court denying the mo-

tion for a new trial (R. 94-95)' is not reported. The

References to the printed record are designated “R” to

indicate “Appendix to Appellants’ Brief” and “Supp. R.” to

indicate “Appendices for the Appellee”. References to the

typewritten record consisting of four volumes of testimony at

the trial and one additional transcript of a supplemental hear-

ing on November 12, 1954, are indicated “Tr.” and “Supp.

Tr.” respectively.

(1)

2

opinion of the Court of Appeals (Pet. 25-37) has

not yet been reported.

JURISDICTION

The judgment of the Court of Appeals (Pet. 37)

was entered on May 23, 1955. The petition for

certiorari was filed on June 20, 1955. The juris-

diction of this Court is invoked under 28 U.S.C.,

Section 1254(1).

QUESTIONS PRESENTED

1. Whether evidence obtained from petitioners’

records should have been excluded on the ground

that the records were not voluntarily submitted to

the Treasury agents.

2. Whether petitioners were deprived of a fair

trial because during the first day of trial one of

the jurors had a brief conversation with one of the

prosecutors (with whom he was acquainted) about

a matter unrelated to the case.

STATUTE INVOLVED

Internal Revenue Code of 1939:

Sec. 145. PEnALTIEs.

* * * *

(b) Failure to Collect and Pay Over Taz, or

Attempt to Defeat or Evade Tax.—Any person

required under this chapter to collect, account

for, and pay over any tax imposed by this chap-

ter, who willfully fails to collect or truthfully

account for and pay over such tax, and any

person who willfully attempts in any manner

3

to evade or defeat any tax imposed by this

chapter or the payment thereof, shall, in addi-

tion to other penalties provided by law, be

guilty of a felony and, upon conviction thereof,

be fined not more than $10,000, or imprisoned

for not more than five years, or both, together

with the costs of the prosecution.

* ~ * *

(26 U.S.C. 1952 ed., See. 145.)

STATEMENT

On March 9, 1953, the grand jury for the Middle

District of North Carolina returned a five-count

indictment against E. V. Turner and another five-

count indictment against I. C. Turner, charging

each with wilful attempts to evade and defeat a

large part of his own and his wife’s? income taxes

for the years 1946 to 1950, inclusive, by filing re-

turns fraudulently understating the amounts of

their income, in violation of Section 145(b) of the

Internal Revenue Code of 1939. The two eases

were consolidated and on October 15, 1954, after a

jury trial lasting ten days (Tr. 2, 1283), petition-

ers were found guilty as charged. (R. 79.) On

November 12, 1954, the trial court denied a motion

for a new trial and sentenced E. V. Turner to two

years and I. C. Turner to one year and one day in

a reformatory. (R. 80). The Court of Appeals

affirmed. (Pet. 25-37.)

* Joint returns were filed by E. V. Turner for the years

1947 to 1950, and by I. C. Turner for the years 1948 to 1950.

(Tr. 8, 10.)

wal eA RRS Boor s

PENTA IN AE EEO NS i TRL momraese” OBI

4

The evidence adduced at the trial and at the

hearing on the motion for a new trial may be sum-

marized as follows:

During the years 1946 to 1950, petitioners, who

were eee equal partners, carried on the

business of designing, fabricating and erecting out-

door advertising signs under the name of Turner

Sign Company. On July 9, 1951, Daniel 8. Forbes

went to the main office of Turner Sign Company,

identified himself to petitioners by showing them

his credentials which indicated him to be a Special

Agent of the Bureau of Internal Revenue, and told

them that their individual income tax returns and

the Turner Sign Company partnership returns had

been assigned to him for examination. After a —

preliminary discussion E. V. Turner summoned

the bookkeeper, H. B. Elliott, and told him to

produce the books and records for Forbes to exam-

ine. Thereafter petitioners left. Elliott identified

for Forbes the books and records, including work

orders located in the plant office. Forbes studied

the books and records in Elliott’s office and then

went to the plant office and secured 35 to 40 work

orders for the year 1950. By eomparing work

orders and sales invoices with the books and rec-

ords he found many items which were not recorded.

(R. 2-8.)

Over a period of months, Forbes and his succes-

sor, Acting Special Agent Ray V. Williams, traced

a substantial amount of unreported income to the

—

partnership’s receipt of barter such as automobiles

and electrical appliances. (Tr. 62-63, 105, 229-230,

451-452, 456, 458-459, 477-479, 497-500.) They also

found recorded sales which were not reported (Tr.

84, 488), a $4,985.50 sale recorded as a loan (Tr.

101-102, 1059) after the proceeds had been con-

verted into a cashier’s: check (Tr. 327-334, 714-715),

deductions from recorded income made without ex-

planation (Tr. 94-97, 1025), partners’ withdrawals

not recorded when made (Supp. R. 36-40; Tr. 1036-

1040) and personal expenditures taken as business

deductions (Tr. 142-145).

Two weeks after the investigation started Elliott

produced a set of invoices for the years 1948, 1949

and 1950, grouped by months and explained to

Forbes that these were the invoices he should

be using and that the others were the wrong in-

voices. Forbes found that the new lot of invoices

corresponded with the books, but they did not ac-

count for any of the unrecorded sales. (Tr. 41, 42,

44-47.) One morning Williams noticed Elliott put-

ting into the waste basket some correspondence

which upon examination (made with Elliott’s per-

mission) he found to include many references to

sales which were neither recorded on the books nor

otherwise evidenced by sales invoices or work or-

ders. (R. 14-15.)

At the trial the Government proved item by item

unrecorded sales for each of the years involved.

Proof of the deficiency required the testimony of

one hundred and twenty-nine witnesses. The addi-

4)

| 2 PT eas ae ae

tional partnership income and the income tax defi-

ciencies of the partners (Supp. R. 20-24, 27-35) are

shown in the following table:

Additional Partnership Income Tax Deficiencies

Year Income E.V.Turner 1.C. Turner

1946 $ 24,967.87 $ 3,672.43 $ 4,030.09

1947 44,016.01 8,255.94 8,519.29

1948 32,478.01 4,860.40 4,741.58

1949 38,620.41 5,158.50 5,071.14

1950 23,287.62 2,800.50 2,381.26

$163,369.92 $24,747.77 $24,743.36

The defense did not attempt to disprove any of

the unrecorded sales constituting the additional

partnership income.

Four weeks after petitioners were found guilty,

the trial judge heard testimony on a motion for a

new trial based upon alleged contacts between As-

sistant United States Attorney E. L. Gavin, Jr.,

who participated in the prosecution, and Lonnie

Buchanan, one of the jurors in the case. Buchanan

had served as a juror during the criminal term of

court in June and was called back in October of the

same year as a member of the panel from which the

jury in this case was chosen. Both of the men lived

in Sanford, which is 58 miles from Greensboro

where the trial was held. Buchanan, an elderly

man, had delivered ice to Gavin’s family when

Gavin was a child and Gavin had gone to school

with Buchanan’s daughter. During the prior June

Term, Gavin gave Buchanan a ride in his ear on

one or two oceasions in going to or from court.

Just before the Turner trial began, Buchanan’s

et IVA AIR 8 DATO SAT P RIN BEN ay

‘ar menememens

ng

7

daughter-in-law requested Gavin to take Buchanan

to court on the opening day and Gavin did so. Dur-

ing the ride Buchanan asked what sort of cases

were going to be tried and Gavin replied ‘‘income

tax cases and I don’t know what else.’ During

the selection of the jury Buchanan was called to

the jury box, and at that time asked the judge to

excuse him because he was 72 years of age, had

served in June, and had a sick brother. Gavin rose

and called the court’s attention to the prospective

juror’s age and to the fact that he had served in

June. However, the judge refused to excuse Bu-

chanan and he was sworn as a member of the jury.

In the afternoon of the same day Buchanan asked

Gavin to drive him home but Gavin replied that

he was not going home. This conversation was re-

ported to the court by Gavin who asked the judge

to instruct the jury again ‘‘not to talk to anybody,”

and the judge did so. (R. 88-91.) Juror J. W.

Honeycutt testified that Lonnie Buchanan told him

that he rode with Gavin the ‘‘first week’’ of the

trial. (R. 93.) Gavin testified that this occurred

only on the morning of the first day of the trial

and that he had no further contact with Buchanan

during the two weeks of the trial. (R.91.) Gavin

had come to court prepared to stay in Greensboro

during the trial and did not go home during the

trial except for one night for a change of clothing.

(R. 89, 93; Supp. Tr. 21.) The motion for a new

trial was denied. (R. 94-95; Supp. Tr. 22.)

Sel ha Pi 0

8

ARGUMENT

1. Petitioners contend (Pet. 14-17) that the evi-

dence obtained from their records by the Treasury

agents should not have been admitted because (1)

petitioners were not warned of possible criminal

prosecution, and (2) the agents’ investigation was

conducted under the guise of a routine examina-

tion for civil tax purposes. The contention is with-

out merit. ;

It is well settled that failure to warn a potential

defendant of his privilege against self-incrimina-

tion does not bar the admission of evidence ob-

tained from him. Powers v. United States, 223

U.S. 308; Wilson v. United States, 162 U.S. 613.

This rule clearly applies to income tax evasion

cases. United States v. Burdick, 214 F. 2d 768, 773

(C.A. 3d), remanded, 348 U.S. 905, reaffirmed, 221

F’. 2d 932, now pending on petition for a writ of

certiorari, No. 168, O. T. 1955; Montgomery v.

United States, 203 F. 2d 887, 892 (C.A. 5th) ; Han-

son V. United States, 186 F, 2d 61, 64-66 (C.A. 8th) ;

Lisansky v. United States, 31 F. 2d 846, 851 (C.A.

4th), certiorari denied, 279 U.S. 873; Scanlon v.

United States, (C.A. 1st), decided June 13, 1955

(1955 P-H, par. 72,772).

The contention that the agents deceived peti-

tioners by gaining access to their records on the

pretense that their only purpose was the deter-

mination of the correct tax liability for civil assess-

ment purposes, finds no support in the record.

=

:

9

There is nothing in the factual situation surround-

ing the permission granted to the agents to examine

petitioners’ books (supra, pp. 4, 5) which war-

rants such an inference. It is plain that petitioners

voluntarily gave the agents access to their books

and records, and there was present no fraud or

decei. to vitiate their consent. Petitioner E. V.

Turner testified (Tr. 1115) that he had never re-

fused to cooperate with the agents but had given

them access to the whole place. The Court of

Appeals was clearly correct in concluding (Pet. 30)

that ‘‘The agents made no investigation to which

the defendants did not consent’’, and that (Pet.

31) ‘‘At no time did the agents bring pressure to

bear upon the defendants or conceal their identity

or practice any deceit.’’ The case of Gouled vy.

United States, 255 U.S. 298, relied upon by peti-

tioners, is clearly distinguishable, for it involved

an entry gained under false pretenses and the seiz-

ure of documents without wa-rant or consent.

2. Petitioners contend (Pet. 17-21) that they

were deprived of a fair trial because one of the

prosecutors (Gavin), who was acquainted with one

of the jurors who lived in his home town 58 miles

from Greensboro (where the case was tried), trans-

ported him to or from Greensboro on at least

three occasions before the trial began, and was

approached by the juror during the afternoon of

the first day of the trial with the question as to

whether he would drive him home that night. As

iat gece hci

10

shown in the Statement (supra, pp. 6-7), Gavin

demurred, had no further contact with the juror

during the remainder of the trial, and immediately

mentioned the incident to the trial judge with the

suggestion that the judge again instruct the jury

‘not to talk to anybody.”’ After taking testimony

concerning the pertinent facts of the matter (on

petitioners’ motion for new trial) the court stated

its confidence that Gavin ‘‘would not be guilty of

any improper conduct with a jury’’ and denied the

motion. (R. 94.) Petitioners’ only exception to

ine ruling (Supp. Tr. 21-22) seems to have been

based ou the alleged insufficiency of evidence to

show the guilt of petitioner I. C. Turner.

The mere fact that Gavin was acquainted with

the juror would not, of course, afford ground for

challenging the juror’s right to sit on the case

(Carpenter v. United States, 100 F. 2d 716, 717

(C.A. D.C.) ; Billington v. United States, 15 F. 2d

399 (C.A. 6th) ). Petitioners assert, however ( Pet.

18, 21), that the contact between Gavin and the

juror during the trial raised a presumption of prej-

udice, and that the holding of the Court of Appeals

is in conflict with Remmer v. United States, 347 U.S.

227; Wheaton v. United States, 133 F. 24 522 (C.A.

8th) ; Stone v. United States, 113 F. 2d 70 (CLA.

6th); and Ryan v. United States, 191 F. 2d 779

(C.A, D.C.), certiorari denied sub nom. Duncan v.

United States, 342 U.S. 928. The first three cases

are clearly distinguishable because they involved

contacts or conversations with the jury or juror

Fa OG ARE ey! ue si

11

during the trials on matters relative to the case in

progress, whereas here the only contact during the

trial was the juror’s question to Gavin as to whether

he could ride home with him that night, and Gavin’s

negative reply. The Ryan case, supra, far from

supporting petitioners’ contention, holds that even

where a juror has a private conversation with the

prosecutor on a matter relating to the case, the

presumption of prejudice can be overcome by af-

firmative evidence. In affirming the conviction, the

court stated (191 F’. 2d at 782):

The prosecuting attorney made no report of

this conversation to the court and did not ad-

vise defense counsel. Clearly he should have

done both. Nevertheless, as with the other con-

versations, the question in the end is whether

the trial judge acted within the permissible

area of discretion in not setting aside the con-

viction because of this occurrence.

The dispositive answer to petitioners’ argument

is that the trial couxt heard the evidence and found

that there was no impropriety and no prejudice.

Even assuming that the contact shown here was

sufficient to raise a presumption of prejudice, the

trial judge’s holding was a matter within his dis-

cretion and is reviewable only for abuse of dis-

cretion. Wheaton v. United States, supra, p. 527;

United States v. Sorcey, 151 F. 2d 899, 903 (CLA.

ith), certiorari denied, 327 U.S. 794; Ryan v.

United States, supra. Clearly, there was no abuse

of discretion here.

12

CONCLUSION

The decision of the court below is clearly correct,

there is no conflict of decisions, and further review

is not warranted. The petition for a writ of cer-

tiorari should be denied.

Respectfully submitted,

Srvon E. Soserorr,

Solicitor General.

H. Brian Hoiuanp,

Assistant Attorney General.

Exuis N. Siack,

JoHN H. MrircHe tt,

Ricuarp B. BuHRMaAN,

DicKINSON THATCHER,

Attorneys,

Department of Justice.

JULY, 1955.

Wu.s. GOVERNMENT PRINTING OFFICE: 1955 asi7968 sa