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March 21, 1980


No. 2489 October Term, 1977 Appeal from the Judgments of Sentence of the Court of Common Pleas of Montgomery County Nos. 2994,2994.5, 2994.6 and 2994.8 of 1976.

Before Price, Spaeth And Watkins, JJ.

Per Curiam:

Judgments of sentence affirmed on the opinion of Judge Brown.



NO. 2994-76


MARCH 15, 1978

After trial by jury, Robert Hamilton was convicted of Deceptive Business Practices, two counts of Theft by Deception and Violation of Section 401 (70 PS 1-401) of The Pennsylvania Securities Act, Fraud in the Sale of Securities. Motions for a New Trial and In Arrest of Judgment were argued and denied. An appeal to the Superior Court from the judgment of sentence necessitates this Opinion. Viewing the evidence in a light most favorable to the Commonwealth, Commonwealth v. Rife, 454 Pa. 506 (1973), the jury could have found the following facts.

Defendant was President of 1776 Magazine, a company incorporated under the laws of Pennsylvania in 1974. The corporation was formed to publish a magazine each month during 1976 narrating events of historical interest which occurred during the same months in 1776. Also in that year, Defendant filed a form with the Pennsylvania Securities Commission seeking author to sell the common stock of the company as required by the Pennsylvania Securities Act of 1972.

From November, 1974 through August, 1975, Defendant attempted to sell advertising space in 1776 Magazine to various companies and state governments. None was sold. Despite this total failure to secure the necessary commitments, Defendant thereafter solicited numerous friends and acquaintance to invest in the venture. Between February and April, 1975, Defendant sold stock worth $56,000. He was able to induce such investment through a series of misrepresentations and omissions calculated to attract investors. Prospective stockholders were shown a highly favorable financial projection lacking any factual basis and falsely listing numerous advertising commitments. Letters from state governments and a number of large corporations were forged. They expressed great interest in the concept and indicated substantial advertising would be bought. Another forged letter, purportedly, from the American Bank, spoke of $1,900,000. in advertising commitments and a $100,000. line of credit for 1776 Magazine. Defendant also represented that a distinguished staff of historians, sociologists and psychiatrists would comprise the magazine's editorial staff. In fact, no such persons were ever contacted by the Defendant or anyone in the organization. In September, 1975, one month before publication was to begin, Defendant vacated his offices and left the state.

Defendant complains that the Trial Court erred in allowing the Commonwealth to introduce evidence of his 1965 mail fraud conviction. It is well established that evidence of other crimes committed by a Defendant is inadmissible to prove his guilt of the crime charged at trial. Commonwealth v. Allen, 212 Pa. Super 314 (1968). However, exceptions to this rule have logically developed in order to secure substantial justice. One such exception states the rule applicable to the facts here. In Commonwealth v. McKenna, 206 Pa. Super 317 (1965), the Court said that

... the commission of another offense is admissible if it became part of the history of the event on trial, or was part of the natural development of the facts."

The Commonwealth charged that Defendant wilfully falsified his application to the Pennsylvania Securities Commission by failing to truthfully answer question nine (9) which asked if the applicant had a prior criminal record. It would have been impossible for the Commonwealth to meet its burden of proof without showing the existence of a prior conviction. The Defendant's Federal conviction was "part of the natural development of the facts" necessary to sustain the false filing charge. As a material element of the crime to be proved, there was no error its admission, especially since the jury was cautioned as to its limited purpose.

Defendant next argues that because the jury did not convict under 70 PS Sec. 1-407, Filing a Misleading Document with the Securities Commission, the Court erred in submitting the charge to the jury. The record discloses ample support for such submission. The fact that Defendant was acquitted is of no more in determining whether the evidence was sufficient for submission.

Defendant moved for a severance of the false filing charge, contending it was separate and distinct from the other crimes charged. Since proof of it required disclosure of his prior conviction to the ...

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