Before MARIS, GOODRICH and STALEY, Circuit Judges.
Appellant Jules Gordon was convicted of conspiracy to commit an offense against the United States, that is to attempt willfully "to evade and defeat a large part of the income taxes due and owing to the United States of America by Alfred W. McClure and Doris K. McClure for the year 1948, in violation of 26 U.S.C. § 145(b)." The conspiracy is in violation of Section 371 of Title 18 of the United States Code. Norman Tanz, an Internal Revenue agent, was tried on the same indictment but was acquitted.Clifford Harper, an accountant for the McClures, was named as co-conspirator but was not indicted. The convicted Jules Gordon, also an accountant, was sentenced to one year's imprisonment and fined $1,000. It is from this sentence and judgment that he appeals.
The following circumstantial evidence was produced by the government in its endeavor to prove a conspiracy to evade income tax among Norman Tanz, Clifford Harper, and appellant Gordon. Alfred W. McClure was the owner of an automobile agency in Troy, Pennsylvania. He and his wife filed their joint income tax return for 1948 showing an amount due of $1,315.70; this amount they paid. In April of 1950, Internal Revenue Agent Tanz visited McClure's place of business for an audit of books and records for 1947 and 1948. Tanz informed McClure that he owed the government a considerable amount of money in additional taxes. Later that same month, Tanz again went to McClure's agency and reaudited the books and accounts. McClure and Harper were both present when Tanz told them that $17,000 more was due as 1948 tax. Harper received a letter from Tanz dated May 16, 1950, suggesting that Harper contact him without further delay in an effort to complete the McClure audit. The letter was typed on plain paper, not official stationery. Harper phoned Tanz and was informed that Tanz had recomputed the tax due from McClure as between $8,000 and $9,000, and that the amount would have to be paid in cash. Around May 23, 1950, McClure transmitted a check for $5,000 to Clifford Harper, payable to his order personally. Harper indorsed and negotiated the check, keeping the $5,000 in cash in his home.
On June 11, 1950, Harper visited Tanz at his home in Philadelphia and Tanz told Harper that he had a friend who could effect a quick settlement of the McClure tax matter for $8,000 or $9,000. Tanz's friend was appellant Jules Gordon, who drove to the place where Harper was staying in Philadelphia and introduced himself as "Mr. Jones." On June 21, 1950, Tanz filed his agent's report showing that the McClures owed only $492.80 in additional tax for 1948. A government tax expert, Tinsley, testified that he audited McClure's records and books and concluded that the tax due from the McClures in 1948 was $11,640.76.
In early July of 1950, appellant Gordon called Harper at the latter's home in Sayre, Pennsylvania, and at Gordon's suggestion they agreed to meet at a hotel in Wilkes-Barre.There appellant inquired of Harper whether he had any money with him to pay on the McClure tax account, adding that $8,000 or $9,000 would be needed to settle it. Harper told him that he had only $3,000 in cash, and although appellant was disappointed, he took the money and left. Later, Tanz told Harper that he knew of the $3,000 which Harper gave appellant.
Harper testified that in early September of 1950 he called Tanz to complain that a bill he received for the McClures' tax did not reflect the $3,000 which was already paid appellant. After Tanz got in touch with appellant concerning this matter, the latter phoned Harper and arranged a meeting with McClure and Harper at a hotel in Elmira, New York. Throughout all of the events up to this conversation, appellant Gordon used the assumed name of "Jones." At the end of the conversation, he informed Harper that his name was now "Smith."
At the hotel in Elmira, appellant said that he wanted to see McClure alone upstairs. There he told McClure that $4,500 was still due on his tax account. McClure refused flatly to pay, stating that he had already given Harper $5,000 and that an independent accounting firm had audited his books for 1948 and confirmed his belief that no further payments were due. Faced with this turn of events, appellant Gordon, at this point appearing to be in a hurry, handed McClure $2,500 in cash, saying that $500 was from him and $2000 was from Tanz. McClure called downstairs for his accountant Harper. When Harper came into the room, he returned to McClure $1,000 or $1,800, the amount being in dispute.
The appellant raises five material allegations of error which must be answered on this appeal: (1) Does the acquittal of Tanz require the acquittal of Gordon for want of capacity to commit the offense? (2) Was the evidence sufficient to sustain the conviction? (3) Did the instructions to the jury adequately define the elements of the offense charged? (4) Was it error to permit the government tax expert Tinsley to testify in view of the fact that all of the records of the McClure agency were not in evidence? (5) Was it error to read to Harper notes of his grand jury testimony without an instruction that such evidence is not substantive?
The Effect of the Acquittal of Tanz.
One of the principal arguments of the appellant is that the acquittal of Tanz requires his acquittal also. This contention is predicated upon the erroneous belief that only Tanz had the capacity to commit the crime proscribed by Section 145(b) of Title 26; and since Tanz was acquitted, only appellant and Harper were left to conspire.Neither he nor Harper, continues the argument, had the capacity to commit the offense, and therefore he must be acquitted.
The fallacy of this reasoning is rooted in the appellant's misconception of the nature of the crime which was the object of the conspiracy. The offense described by Section 145(b) of Title 26 is a willful attempt "in any manner to evade or defeat any tax." It is true that one manner of such attempt may be the willful filing of a false report with the taxing authorities. But to conclude that the willful filing of a false report or return is the only way "to evade or defeat any tax" is to give too narrow a construction to a statute which was intended to be more comprehensive. United States v. Johnson, 1943, 319 U.S. 503, 515, 63 S. Ct. 1233, 87 L. Ed. 1546. The filing of a false report or return is not even an essential element of the crime. United States v. Albanese, 2 Cir., 224 F.2d 879, 882, certiorari denied, 1955, 350 U.S. 845, 76 S. Ct. 87, 100 L. Ed. 753. And the fact that appellant performed many of the overt acts of the conspiracy after the date that Tanz filed his false report is irrelevant. United States v. Johnson, supra, 319 U.S. at page 515, 63 S. Ct. at page 1239. Of course, the fact that Harper and appellant are neither taxpayers nor revenue agents has no bearing upon their capacity to violate Section 145(b).
"* * * As the Supreme Court remarks, there is evidently no legislative purpose to exempt from punishment one who actively endeavors to defeat a tax, whatever his relationship to the taxpayer may be." Tinkoff v. United States, 7 Cir., 1936, 86 F.2d 868, 876, certiorari denied, 1937, 301 U.S. 689, 57 S. Ct. 795, 81 L. Ed. 1346.
It follows that appellant, Harper, and Tanz all had capacity to violate Section 145(b) of Title 26, and the jury might well have found a conspiracy from those events and ...