MODEL PENAL CODE ANNOTATED

STATE

v.
KEMP
Supreme Court of Errors of Connecticut
126 Conn. 60 (1939)
 

 [p. 63] MALTBIE, Chief Justice.

 The defendant was tried and found guilty upon a grand jury indictment in two counts charging that, while acting as the agent of the highway commissioner in the purchase of land for the state, he fraudulently agreed to receive, and did receive, a share of the commissions of two agents who represented the sellers of certain lands.  He was tried, found guilty and sentenced for the crime of conspiracy.  The two brokers arrested under the indictment, were not put to trial with the defendant.

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[p. 75]

 The jury might reasonably have found the following facts:  At and before the time of the occurrence now in question, the defendant was an experienced real estate broker.  In 1932 he was employed by the highway commissioner of the state in connection with the purchase of lands made necessary by the layout and construction of the Merritt Parkway through Fairfield County.  It was agreed that he should be paid at the rate of $15 per day and reimbursed for expenses he incurred but he was not required to devote all his time to his employment by the state.  During the some six years of that employment he received about $24,000 from the state as compensation.  In his work he was known as the state purchasing agent and was the only agent acting in this capacity in connection with this highway.  It was his duty to negotiate with the owners of the lands needed for the highway or their agents for their purchase by the state.  He had no authority actually to buy any land; his function was to arrive at an agreement as to the price for which it could be brought; this he submitted to the officers of the department for their approval; and if the price agreed upon was satisfactory the purchase was ultimately consummated by the representatives of the attorney general. [p. 76] Great confidence was reposed in him and his recommendation that a certain sum be paid for a tract of land was usually accepted without question. In negotiating for the purchase of lands he dealt with numerous brokers representing the owners.  Most of these brokers had only one or a very few properties in their hands and the two who had more than any of the others were Samuel H. Silberman and Thomas N. Cooke.  Silberman did business in the name of a corporation all the stock of which he owned, and Cooke did business as a corporation, 70 per cent. of which he owned and which he controlled.  Each of them, previous to the defendant's employment by the state, had been accustomed to divide commissions with him where both were instrumental in bringing about a sale of property.  About January, 1933, when the defendant was negotiating with Silberman for the purchase of a certain tract of land, he stated to the latter that he thought he was entitled to the usual share where brokers divide a commission and Silberman agreed that he was, but no specific amount was mentioned.  Thereafter in all transactions in which Silberman acted as a broker for the owners of the land sold to the state, thirty-seven in all, Silberman paid the defendant a substantial share of the commissions he received, in most instances one-half of the amount, except that in some cases deductions were made for expenses and the like.  In each instance Silberman paid whatever he thought the defendant was entitled to receive and the latter accepted that sum without protest.  About a year after his first transaction with Silberman, the defendant negotiated for the first purchase in which Cooke acted as a broker. The defendant offered to give Cooke 'leads' on property the state would need if the latter wanted to work with him and suggested that they share the commission [p. 77] on the same basis as they had been doing as regards transactions with private buyers.  Thereafter whenever a sale was made to the state through the defendant by owners represented by Cooke, nineteen in all, Cooke gave him one-half the commission after deducting the income tax Cooke expected to pay on that share, the expenses incurred in the transaction and certain sums owed to Cooke by the defendant in other matters, except in one instance where the amount of the commission which the defendant otherwise would have received was set off against amounts representing taxes which Cooke expected to pay and which had not been deducted from payments previously made to Cooke.  The defendant thus received from Silberman some $28,000 and from Cooke some $15,000, and in fact on the witness stand he admitted receiving from the former $10,400 and from the latter $11,543.40.  Except for the first three payments made by Cooke to the defendant, which were by check, all amounts turned over to the defendant by both the brokers were in cash, the sums at times amounting to several thousand dollars.  The last payment made by Silberman was about April 6, 1937, and the last made by Cooke was about November 6, 1937.  The defendant at no time informed any representative of the state that he was receiving these sums; he regarded them as personal receipts and did not turn them in to the corporation which he controlled and through which he carried on his real estate business; and the only record he kept of them was in a small personal memorandum book.  There was no evidence that by reason of these payments to the defendant the state paid any more for the lands than it would otherwise have done.

 In State v. Parker, 114 Conn. 354, 360, 158 A. 797, 799, was quoted, with approval, from 12 C.J., p. 547, as follows:  'In order that a combination may be punishable [p. 78] it must be formed to do either an unlawful act or a lawful act by criminal or unlawful means.  * * * It is not essential, however, to criminal liability that the acts contemplated should constitute a criminal offense for which, without the elements of conspiracy, one alone could be indicted.  It is an offense independent of the crime or unlawful act which is its purpose; and it will be enough if the acts contemplated are corrupt, dishonest, fraudulent, or immoral, and in that sense illegal.  A conspiracy will be indictable, if the end proposed or the means to be employed are, by reason of the combination, particularly dangerous to the public interests, or particularly injurious to some individual, although not criminal.'  We pointed out in that case that the proposition so broadly stated is subject to certain limitations.  Certainly it would not do to hold that whenever two persons combine to do an act which in a civil proceeding would be held to be illegal, they necessarily are subject to prosecution for a criminal conspiracy.  State v. Glidden, 55 Conn. 46, 70, 8 A. 890, 3 Am.St.Rep. 23; Commonwealth v. Hunt, 4 Metc.,Mass., 111, 124, 38 Am.Dec. 346; Commonwealth v. Donoghue, 250 Ky. 343, 347, 65 S.W.2d 3, 89 A.L.R. 819; 2 Wharton, 12th Ed., § 1617.  It is undoubtedly a breach of duty for a broker representing the buyer of real estate, without the knowledge of his principal to agree with a broker representing the seller of the property to divide the commission which the latter might receive on account of the sale; Tracey v. Blake, 229 Mass. 57, 61, 118 N.E. 271; Restatement, Agency, § 391(c); but that wrong would not in itself justify the prosecution of the brokers for a criminal conspiracy.  There is, however, in this case an additional and controlling element.

 Section 6288 of the General Statutes provides that any person 'being a public officer, trustee or agent,' or a member of the board of management of any public [p. 79] or private institution or corporation, who shall receive for his own use directly or indirectly from any person or corporation with whom he makes a contract or transacts any business in such a capacity or with whom the board of management of which he is a member makes a contract or transacts any business, any payment, commission or compensation or a gratuity of any kind by reason of or in connection with the making of such contract or the transaction of such business, shall be imprisoned, fined or both.  Certainly the defendant was a public agent within the terms of this statute and he took payments from persons with whom he was transacting business, in the sense at least of negotiating for the purchase of property for his principal, the state.  The Legislature has seen fit to characterize conduct of the nature of that defined in the statute as so harmful to public interests that it is to be prosecuted and punished as a crime.  When the conduct so condemned is that of an agent of the state itself it becomes in a very real sense a public wrong.  The defendant's conduct certainly fell within the evil it was designed to prevent and the statute serves to characterize his acts in accepting the payments from Silberman and Cooke as likely to result in serious harm, not to individuals alone, but to the public interest.  His conduct falls within the words of the quotation we have made from State v. Parker, 'corrupt,' 'dishonest' and 'immoral,' and suffices to make the agreements between him and Silberman and Cooke common law conspiracies.  Commonwealth v. Waterman, 122 Mass. 43, 58; Smith v. People, 25 Ill. 17, 24, 76 Am.Dec. 780; Commonwealth v. Donoghue, supra.

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 There is error only as regards the sentence imposed, the judgment is set aside, and the case remanded for the rendition of a judgment upon the verdict in accordance with law.

 In this opinion the other Judges concurred.