Appeal form the Judgment entered November 6, 1985 in the Court of Common Pleas of Lackawanna County, Criminal, No. 83 CR. 674.
Charles P. Gelso, Wilkes-Barre, for Lavelle, appellant (at 2928).
Albert J. Slap, Philadelphia, for Lavco, appellant (at 3129).
Keith Welks, Deputy Attorney General, Harrisburg, for Com., appellee.
Cirillo, President Judge, and Cavanaugh, Rowley, Wieand, McEwen, Olszewski, Beck, Tamilia and Popovich, JJ.
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These consolidated appeals were undertaken from the judgments of sentence imposed upon appellants, William A. Lavelle, III,*fn1 and Lavco, Inc.,*fn2 after the trial court, sitting without a jury, found each of them guilty of violations of the corrupt organizations statute, 18 Pa.C.S. § 911.*fn3
The able opinion of the distinguished President Judge Edwin M. Kosik provides an apt summary of the facts giving rise to the prosecution of appellants:
The trial developed that defendant Lavelle was President of Control Sanitation Corporation which engaged in the collection and disposal of refuse. On November 7, 1977, a family corporation known as W.A. Lavelle & Son Co. was incorporated in Pennsylvania. Lavelle was its President. Both companies operated out of an office and garage located at 1620 North Keyser Avenue, Scranton. During the period of its existence until March 1979, Lavelle & Son engaged in the business of hauling and disposition of industrial wastes in solid and liquid form. Such materials were systematically dumped or disposed of at the Morgan Highway landfill or poured down a mine borehole located at the office address of both companies
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then in existence, to wit, 1620 Keyser Avenue, Scranton. Employees engaged in the hauling of the industrial waste were instructed by Lavelle to dispose of the waste at each site. Lavelle reported that the borehold at Keyser Avenue deposited the waste into a holding tank or the lines of the Scranton Sewer Authority. Lavelle, at one point, instructed that windows at the borehole site be painted. Neither site was officially approved for the receipt of industrial waste, nor was the site owner or Lavelle provided with any oral or written permit to dump the industrial waste as required by law.
Lavelle solicited the business of several companies whose operations resulted in the generation of industrial wastes as a by-product. Such wastes had to be disposed of in an appropriate facility. The representatives of the various companies solicited by Lavelle consistently testified that Lavelle personally or through reference represented the epitome of reliability in the field of disposal. Lavelle offered a series of documents which allegedly represented permits for the disposition of waste at various sites, along with letters of recommendation from exisiting customers. In each instance Lavelle assured his customers that disposal would conform with the requirements of both state and federal laws. In at least one instance Lavelle was provided with a sample of a waste by-product to determine if it was acceptable at the Morgan landfill site. The waste generator was orally advised by Lavelle that it was approved and that representatives of the state continued to monitor the landfill operations as material was received. During the period covered in the indictment, there were over seven hundred instances in which Lavelle had contracts or purchase orders to haul and dispose of wastes for a consideration which would not have been authorized had the waste providers known of the deception and false impressions as to the intentions of Lavelle in disposing of the industrial wastes. In the fiscal year October 31, 1978, ending October 31, 1979, Lavelle and Son received over four hundred thousand dollars as [gross] income from undocumented disposal of
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industrial waste; that is, waste disposed of by Lavelle and Son without documentation as to where such wastes were specifically deposited. The Commonwealth offered evidence that Lavelle was aware of the permit requirements in order to dump industrial wastes at the Morgan landfill. In June of 1978 Lavelle and Son apologized for dumping industrial waste without a permit on one stated instance. There was evidence that in the latter part of 1978 or the early months of 1979 there was much publicity over another local hauler of industrial waste who was being investigated for illegal dumping on a site located within miles of the Lavelle and Son disposals. Lavelle was aware of this investigation and assured at least one of his customers that there was no connection. Soon thereafter, Lavelle represented to customers that it was becoming more difficult to get state approval for the disposition of wastes at sites utilized by him. Thence, Lavelle commenced a withdrawal from the disposal business, and just continued to haul the wastes to locations determined by the customer. In fact, the last date Lavelle and Son performed a service [resulting in illegal dumping] was on March 29, 1979.
It appears from the evidence that when Lavelle and Son ended its corporate activity as a hauler and disposer of industrial wastes, a new corporation, the defendant Lavco, Inc. took over the work of just hauling industrial wastes which had previously been contracted out to Lavelle and Son. Lavco is a Pennsylvania corporation which was incorporated on December 21, 1978. Members of the Lavelle family, except the defendant Lavelle, are officially and legally the incorporators, stockholders and officers of Lavco. While Lavelle appears to have no official connection with Lavco, he continued to represent Lavco in soliciting business, and as will appear more clearly later, he identified and held himself out as the owner and President of Lavco. Substantial assets of Lavelle and Son were sold to Lavco for a consideration. In addition, monies were loaned to Lavco by Lavelle and Son (labor
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and other expenses paid by Lavelle and Son), and the employees of Lavelle and Son continued as the employees of Lavco. Lavco at one point made a substantial loan to defendant Lavelle. The Commonwealth has established that between June 1979 and February 1981 there was an aggregate flow of $118,845.00 from Lavelle and Son to Lavco. Of course, a substantial portion of this was repaid by Lavco.
I. Appeal of William A. Lavelle, III
The sole issue raised in the appeal of William A. Lavelle, III, is that he is entitled to discharge by virtue of the fact that the proceedings against him were instituted after the period prescribed by the applicable statute of limitations had expired. Appellant contends that the five year statute of limitations provided by 42 Pa.C.S. § 5552(b)(1), effective July 12, 1982, cannot be retroactively applied to the instant prosecution when the last predicate offense occurred in June of 1979. Rather, appellant argues, the former two year statute of limitations contained at 42 Pa.C.S. § 5552(a) is applicable, so that the criminal complaint issued against appellant on August 5, 1983, was time barred.*fn4
The Attorney General argues that the amended five year statute of limitations should be applied retroactively, but that even if the former two year statute of limitations were to be applied, the prosecution was instituted in a timely fashion since the date of the last predicate act is irrelevant in determining the date upon which the statute of limitations commences.
The violations of the corrupt organizations statute committed by appellant are continuing offenses in that the offenses are "deemed to continue so long as the person who committed the violation continues to receive any benefit from the violation." 18 Pa.C.S. § 911(c). Thus, as the trial court correctly concluded, the statute of limitations does not
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commence running upon the date on which the last predicate offense is committed but instead, commences upon the date on which the defendant last receives a benefit from the offense. 18 Pa.C.S. § 911(c). Since the statute of limitations period did not begin to run until the continuing violations of the Act, in the form of the receipt of benefits, ceased, we must determine at what point in time appellant Lavelle last received a benefit from his violations of Section 911(b)(1) and (b)(3) of the Corrupt Organizations Act.
A. Charges against William A. Lavelle, III arising under 18 Pa.C.S. § 911(b)(3)
Appellant was charged with and convicted of violating section 911(b)(3) of the Act which provides:
§ 911. Corrupt organizations
(b) Prohibited activities. --
(3) It shall be unlawful for any person employed by or associated with any enterprise to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity.
Thus, in order to convict appellant of a violation of 18 Pa.C.S. § 911(b)(3), the Commonwealth was required to prove that:
(1) appellant was an employee of, or associated with, Wm. A. Lavelle & Son, Co.,
(2) appellant participated, directly or indirectly, in the conduct of the affairs of Wm. A. Lavelle & Son, Co., and
(3) Wm. A. Lavelle & Son, Co.'s affairs were conducted through a pattern of racketeering activity.*fn5
Appellant's conviction under subsection (b)(3) rested, as recounted by the trial court in the aforequoted factual
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summary, upon evidence of a series of thefts by deception committed by appellant in the course of his conduct of the affairs of the corporate enterprise of Wm. A. Lavelle & Son, Co. The company's final receipt of income from the disposal of hazardous waste was received on June 29, 1979.*fn6 However, pursuant to section 911(c), the violation of 18 Pa.C.S. § 911(b)(3) continued so long as appellant continued to receive any benefit from conducting the affairs of Wm. A. Lavelle & Son, Co. through a pattern of racketeering. The Commonwealth established that appellant received "loans" from Wm. A. Lavelle & Son, Co., totaling approximately $39,000, and that the last such "loan" occurred, on October 13, 1979. Appellant, however, also received substantial cash payments, designated as wages, from Wm. A. Lavelle & Son, Co. through the last quarter of 1979. Thereafter, appellant received substantial cash payments, designated as wages, from Lavco, Inc. through February of 1981. The last transfer of funds from Wm. A. Lavelle & Son, Co. to Lavco, Inc. occurred in February of 1981. These cash payments were receipts of benefits derived from the racketeering offense. Thus, the violation of 18 Pa.C.S. § 911(b)(3) continued at least until February of 1981.*fn7 The Commonwealth argues, however, that appellant Lavelle continued to receive a benefit so long as these loans remained unpaid and were carried on the books of Wm. A. Lavelle &
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Son, Co., as accounts receivable. It appears from our review of the record that these loans were never repaid and, according to the Attorney General, were maintained on the books of the corporation "until at least the last quarter of 1982."*fn8 Thus, the Attorney General argues in this appeal that appellant continued to receive a benefit until "at least the last quarter of 1982".*fn9
If we were to accept the argument of the Commonwealth, we would be forced to conclude that because the loans remained unpaid, appellant is still enjoying a benefit and that, as a result, the statutory period of limitations has not yet commenced. This argument is spurious since it ignores the plain language of section 911(c) which tolls the statute for only so long as benefits are "received", rather than "enjoyed", and would result in the elimination of the statute of limitations in many, if not all, prosecutions under the Act.*fn10
Since we have concluded that the violation of 18 Pa.C.S. § 911(b)(3) by William A. Lavelle III continued, as a result of his receipt of benefits arising from the violation, until at least February of 1981, it is upon this date that the statute of limitations commenced running.
The statute of limitations applicable, in February of 1981, to violations of the Corrupt Organization Act was the two year statute of limitations formerly provided by 42 Pa.C.S. § 5552(a). This two year limitations period would have expired in February of 1983. However, on May 13,
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, prior to the expiration of the statute of limitations, the legislature enlarged the two year statute of limitations provided by 42 Pa.C.S. § 5552(a) to five years for certain offenses, effective July 12, 1982. 42 Pa.C.S. § 5552(b). Thus, the issue presented by the appeal of William A. Lavelle, III, is whether the five year statute of limitations, which became effective prior to the expiration of the former two year limitations period, is applicable to these offenses.
This Court resolved this issue in the en banc decision of Commonwealth v. Harvey, 374 Pa. Super. 289, 542 A.2d 1027 (1988). The Court held that where a prosecution has not yet been commenced, and the applicable period of limitations is enlarged by the legislature, the new and expanded period of limitations is applicable, so long as at the time of the enactment of the new period of limitations, the right of the Commonwealth to proceed with a prosecution had not yet been barred under the former statute of limitations. Id., 374 Pa. Superior Ct. at 294, 542 A.2d at 1029. The Supreme ...