THE PEOPLE OF THE STATE OF NEW YORK ex rel. SOLOMON S. CARVALHO and Others, Respondents,
THE WARDEN OF THE CITY PRISON, Defendant. THE PEOPLE OF THE STATE OF NEW YORK, Appellant.
APPEAL by The People of the State of New York from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 24th day of June, 1909, sustaining three separate writs of habeas corpus issued on behalf of the respective relators.
Robert S. Johnstone, Deputy Assistant District Attorney, for the appellant.
Clarence J. Shearn, for the respondents.
An article was published in the New York American in its issue of December 17, 1908, which constituted a criminal libel, and it was so held by this court on an appeal by the publishing company from a conviction therefor. (People v. Star Co., 135 A.D. 517.) The Star Company, which published the newspaper, is a domestic corporation, and the relator Carvalho was its president, and the relator Merrill its treasurer, and the relator Clark its secretary, and their names appeared on each issue of the paper as such officers pursuant to the requirements of the statute. (Laws of 1907, chap. 475.) Each of the relators was held by one of the city magistrates, before whom an examination was had, to answer in the Court of General Sessions on the charge of criminal libel on the theory that he was one of the managers of the publishing company within the provisions of section 246 of the Penal Code, as it existed at the time of the publication. That section of the Penal Code then provided as follows: 'Every editor, or proprietor of a book, newspaper or serial, and every manager of a partnership or incorporated association, by which a book, newspaper or serial is issued, is chargeable with the publication of any matter contained in such book, newspaper or serial. But in every prosecution for libel the defendant may show in his defense that the matter complained of was published without his knowledge or fault and against his wishes, by another who had no authority from him to make the publication and whose act was disavowed by him so soon as known.'
The only evidence upon which the relators were held was an admission that they held respectively these respective offices at the time of the publication. There was neither evidence with respect to what powers, if any, had been delegated to them, nor with respect to what duties had been imposed upon them by the board of directors; nor was it shown what functions they performed.
The decisions with respect to the civil liability of a corporation for the acts of its president and other officers are not controlling on the question presented by this appeal. In all of those cases there was for the basis of the decision the fact that the officer assumed to act for the corporation, and that it was with respect
to a matter which might properly have been delegated, and ordinarily is delegated to such officer by the board of directors. Moreover this is a criminal prosecution for a violation of a statute where criminal intent is an essential element of the crime, and the statute must be construed strictly in favor of the accused. (Penal Code, § 242; Roberson v. Rochester Folding Box Co., 171 N.Y. 538, 557.)
The learned counsel for the People concedes that there must be a criminal intent, but he contends that, although section 242 of the Penal Code provides that the publication must be malicious, yet section 244 of the same Code provides that if the publication be a libel as defined in section 242, then it is deemed to be malicious unless justification or excuse therefor is shown as therein provided. He contends that intent to publish the article constituting the libel is sufficient to constitute the criminal intent within the purview of these provisions. It is not necessary to go further than this concession to sustain the order now under review, for I am of opinion that the mere fact that the relators held the offices enumerated is not sufficient to show that they intended to publish the libel.
It is further contended on behalf of the People in effect that there is a presumption of law that the relators were managers of the corporation which published the libel arising from the fact that they held these respective offices. I am of opinion that this contention is not sound. The Star Company was a stock corporation, and if we consult the statutes of the State with respect thereto we find that the management of such corporations is vested in the board of directors (Gen. Corp. Law [Gen. Laws, chap. 35; Laws of 1890, chap. 563; Laws of 1892, chap. 687], § 29, as amd. by Laws of 1901, chap. 214, and Laws of 1904, chap. 737 [now Gen. Corp. Law (Consol. Laws, chap. 23; Laws of 1909, chap. 28), § 34]; Id. § 30 [now Gen. Corp. Law (Consol. Laws, chap. 23; Laws of 1909, chap. 28), § 35]; Id. § 39, added by Laws of 1895, chap. 672, as amd. by Laws of 1901, chap. 355 [now Gen. Corp. Law (Consol. Laws, chap. 23; Laws of 1909, chap. 28), § 43]; Id. § 3, subd. 6, as amd. by Laws of 1895, chap. 672 [now Gen. Corp. Law (Consol. Laws, chap. 23; Laws of 1909, chap. 28), § 3, subd. 6]), and we find that section 27 of the Stock Corporation Law (Gen. Laws, chap. 36;
Laws of 1890, chap. 564; Laws of 1892, chap. 688), which is now section 30 of the Stock Corporation Law (Consol. Laws, chap. 59; Laws of 1909, chap. 61), and which is the only statute relating to the powers of a president, or a secretary, or a treasurer of a corporation, provides that the directors may appoint from their number a president, and may appoint a secretary, a treasurer and other officers, agents and employees, 'who shall respectively have such powers and perform such duties in the management of the property and affairs of the corporation, subject to the control of the directors, as may be prescribed by them or in the by-laws.' Section 614 of the Penal Code, which related to frauds in the management of corporations, also expressly recognized by the definition of 'director' that the management of the affairs of a corporation is vested by law in the board of directors. It is quite clear, I think, that no presumption arises sufficient to sustain a criminal prosecution that either a president, or a secretary, or a treasurer is a manager of a corporation, and it has been so held with respect to a secretary and treasurer. ( Mecabe v. Jones, 10 Daly, 222; Folwell v. Miller,145 F. 495; Cook Corp. [ 6th ed.] § § 716, 717, 718. See, also, People v. Sherman,103 N.Y. 513, opinion of LANDON, J., General Term, in Case and Points in Court of Appeals; Rox v. Hays, 14 Ont. L. Rep. 201, 207; Vardeman v. Penn. Life Ins. Co.,135 Ga. 117.) It may be that, since the statute requires the corporation to elect a president from the number of the board of directors, it is to be presumed that Carvalho was a director, but even so that did not, in my opinion, make him a manager of the corporation within the provisions of the Penal Code in question. I think that the Legislature did not intend to embrace in the term 'manager,' as therein used, every director of a corporation; nor did it intend to ...