Steinbrecher v. Wapnick,
Judges Burke, Bergan and Keating concur with Chief Judge Fuld; Judge Breitel dissents and votes to affirm in an opinion in which Judges Scileppi and Jasen concur.
The plaintiff, a used car dealer, brought the present civil action, alleging that the defendant Wapnick, in concert with several others, had fraudulently sold him 17 stolen automobiles. When Wapnick was examined before trial, he refused to answer questions concerning his participation in the sale of the stolen vehicles on the ground that the answers would tend to incriminate him. The primary question posed by this appeal is whether he had previously waived his right to do so by virtue of statements he had earlier made in another connection.
In 1961, when Wapnick asserted his privilege, two indictments, charging him with activities similar to those alleged in the complaint, were pending against him -- one in a Federal court and another in Queens County.*fn1 Pointing to Wapnick's refusal to respond to questions at that examination before trial, the plaintiff sought an order, under section 299 of the former Civil Practice Act (superseded by CPLR 3126), striking the defendant's answer and awarding the plaintiff judgment by default. The court at Special Term granted that motion and entered a judgment in favor of the plaintiff and against Wapnick for $33,925, the total amount demanded in the complaint. Following the Appellate Division's affirmance of that disposition, the defendant appealed to this court on constitutional grounds.*fn2
The present suit was originally instituted in July of 1959, when the plaintiff obtained an order for Wapnick's arrest. Shortly after that order had been executed, the defendant served a verified answer, denying allegations of the complaint, and moved at Special Term to vacate the arrest order. In support of that motion, and of a similar motion made the following year, the defendant submitted four affidavits, containing challenges to the sufficiency of the plaintiff's case and generally denying any knowledge of the fraudulent transactions charged against him. These affidavits, plus the denials in the defendant's answer, form the basis for the plaintiff's argument that the defendant had waived his privilege at the examination before trial. Although the defendant declined to answer, on constitutional grounds, 42 questions addressed to him at that examination, the plaintiff claims that he had waived the privilege by reason of statements which the plaintiff says related to nine of them. As to four of those statements, however, the plaintiff merely points to implied "admissions," that is, admissions resulting from the defendant's failure to deny allegations of the complaint. Such an argument is specious. Certainly, one does not waive his constitutional privilege, his right to remain silent, by simply remaining silent. Stated somewhat differently, the mere failure to deny an allegation in a complaint, or to deny any other assertion, can never serve as a predicate for a claim of waiver.
This leaves five questions, put to the defendant, upon which the plaintiff relies to support his claim. However, comparison of them with the statements in the defendant's papers demonstrates that the defendant had said nothing which could reasonably be deemed to have effected a waiver of his privilege.*fn3
As to the first of these questions -- "Are you in business at the present time?" -- it is apparent that the defendant's statement dealt with a completely different issue, namely, the defendant's reputation, and does not indicate whether or not he was engaged in business at the time the question was asked. Similarly, although the last question (No. 5) related solely to the defendant's actual knowledge of certain payments, the statement quoted was merely the defendant's argument as to possible implications which might have been drawn from the guarantee of title; it casts no light on whether any payments were made or, if they were, whether the defendant was notified of that fact. Thus, there are only three questions -- designated Nos. 2, 3 and 4 -- which may be said to have been touched on by the defendant's earlier statements.
Proceeding to them, it appears that, as to two of those three (Nos. 3 and 4), the plaintiff relies on the defendant's statement in which he generally denies any participation in fraudulent transactions. Unless this denial of wrongdoing is sufficient to constitute a waiver of the privilege, but a single question remains (No. 2) out of the 42 which the defendant refused to answer, concerning which there was an actual and direct admission in the defendant's sworn statements. The fact that the defendant had, in effect, given an answer to this one question -- "Do you know the plaintiff, Mr. Steinbrecher?" -- by stating that he had dealt with him in a completely unrelated transaction, cannot possibly be deemed sufficient to support the claim of waiver of the privilege and entry of a default judgment (of over $33,000). Accordingly, the question whether the dismissal of the answer was justified hinges upon the effect of the defendant's statement -- made in connection with his application to vacate the order of arrest -- that, "if the facts charged by plaintiff are true with respect to the co-defendants herein, I had no knowledge of or connection with the fraudulent acts charged to them." In our view, this general denial of guilt -- made under circumstances completely removed from and independent of the examination before trial -- did not constitute a waiver of the defendant's right to assert his privilege in the latter proceeding.
In determining whether a person, by his previous acts or statements, has waived his privilege against self incrimination, the first important distinction to keep in mind is the difference between the privilege accorded an accused in a criminal case, who need not give any testimonial evidence whatsoever, and the privilege accorded the ordinary witness -- including a party in a civil case -- who may be compelled to testify as to any matter which does not actually tend to incriminate him. In the former case, where the scope of the privilege is the most sweeping, the courts have traditionally been more ready to find that there was a waiver. Thus, a defendant in a criminal prosecution who testifies at his trial may be compelled to answer questions as to all matters relevant to the case. (See, e.g., People v. Johnston, 228 N. Y. 332, 340; see, also, Richardson, Evidence [Prince's 9th ed.], § 533, pp. 543-544.)
On the other hand, an ordinary witness, including a party in a civil suit, does not waive his privilege by the mere act of testifying. The rule, as stated by the Supreme Court, is that, "where the previous disclosure by an ordinary witness is not an actual admission of guilt or incriminating facts, he is not deprived of the privilege of stopping short in his testimony whenever it may fairly tend to incriminate him." (McCarthy v. Arndstein, 262 U.S. 355, 359; see, also, e.g., Rogers v. United States, 340 U.S. 367,373; People ex rel. Taylor v. Forbes, 143 N. Y. 219, 229-231; Matter of Siegel v. Crawford, 292 N. Y. 651, affg. 266 App. Div. 878; Foster v. People, 18 Mich. 266, 274; 8 Wigmore, Evidence [McNaughton's rev. ed., 1961], § 2276, pp. 456-458.)
The differentiation which has thus been drawn between a criminal defendant and a party in a civil suit (or any other witness) stems from the nature of the privilege itself. The civil litigant (or the witness) may not refuse to answer a question unless the answer to it would have an incriminating effect. If he is interrogated about a certain event, and can answer the query in a nonincriminatory manner, he has no choice but to do so. Nevertheless, the answers to other questions, relating to the very same transaction, may still have an incriminating effect and, despite his previous testimony, the privilege must still be accorded the witness. However, if a nonincriminating statement were held to open the door to further inquiry, and thus required the witness to later make incriminating statements, he would have to be accorded the privilege of asserting his right to remain silent and of keeping the door closed at an earlier stage. In other words, if the privilege is deemed waived by a nonincriminatory statement, then, the scope and reach of the privilege would have to be expanded to include the right to refuse to make such a statement. (See 8 Wigmore, Evidence [McNaughton's rev. ed., 1961], p. 457; Note, Waiver of the Privilege Against Self Incrimination, 14 Stan. L. Rev. 811, 816-817, n. 23.)
In order to preserve the rule that a witness must respond to questions if the answers are not incriminating, therefore, the principle has been established that, even where the witness has already given testimony as to a particular transaction, he is still entitled to refuse to answer questions unless it is "perfectly clear and plain * * * that the answer cannot possibly injure him, or tend in any degree to subject him to the peril of prosecution." (People ex rel. Taylor v. Forbes, 143 N. Y. 219, 231, supra.) This rule applies unless the defendant has actually waived -- that is, consciously relinquished -- the right to remain silent either by an express agreement or by voluntarily making a statement that is actually incriminatory and evidences a willingness to forego his constitutional privilege.
The application of this principle is illustrated by this court's decision in Matter of Siegel v. Crawford (292 N. Y. 651, affg. 266 App. Div. 878, supra), a case very similar to the one now before us. In Siegel, an insurance agent had been sued for making false and fraudulent "comparisons" between insurance policies, an act which subjected him to criminal as well as civil penalties (Insurance Law, § 127, subd. 4). At an examination before trial, the defendant admitted that his employees had dealt with the plaintiff but denied any personal knowledge of the transactions. Later, in the very same examination, he refused to answer questions, relating to the comparisons made for the plaintiff, on constitutional grounds. Unlike the present plaintiff, who, in a similar situation, moved directly to dismiss the answer, the plaintiff in that case sought and obtained a court order directing the defendant to respond. When the latter persisted in his refusal, the court cited him for contempt and the defendant brought an article 78 proceeding in the Appellate Division to review the determination. The Appellate Division annulled the contempt order on the ground that "the Justice had no power to deprive the witness of his privilege" (266 App. Div., at p. 879) and, on appeal, this court affirmed (292 N. Y. 651). The plaintiff in the Siegel case had argued that, since the defendant had previously denied any personal involvement in the transactions but had acknowledged their existence, he was no longer entitled to claim the privilege. This court rejected that argument, and held that, so long as the answer to the question could still have a possible incriminating effect, the defendant could not be compelled to speak.
There is one important exception to the general rule that a witness is free to rely on the privilege unless he has waived it by voluntarily testifying to incriminating facts. Since the sole purpose of the privilege is to shield a witness against the incriminating effects of his testimony, the courts will not permit its use as a weapon to unfairly prejudice an adversary. (See Levine v. Bornstein, 6 N.Y.2d 892; Brown v. United States, 356 U.S. 148, 155-156.) In the Levine case (6 N.Y.2d 892, supra), the privilege was invoked by a plaintiff at an examination before trial in a civil suit, with the effect of depriving the defendant of information necessary to his defense. For this reason, our court upheld an order dismissing the complaint. The considerations which motivated the court in the Levine case, however, have no application where the privilege is asserted by a defendant. (See 3 Weinstein-Korn-Miller, N. Y. Civ. Prac., § 3126.15.)*fn4
The case of Brown v. United States (356 U.S. 148, supra) -- upon which the plaintiff herein relies -- is another example of a situation in which a civil litigant abused the privilege by using it as a means of gaining an unfair advantage over his adversary. In that case, a defendant in a denaturalization proceeding had testified extensively on her own behalf and then sought to use the privilege to cut off the Government's right to cross-examine her. The Supreme Court concluded that it was appropriate to use the contempt power to compel the witness to respond. However, the Supreme Court restated and reaffirmed that, as a general rule, a witness retains his right to invoke the privilege unless his previous testimony contains "'an admission of guilt or [furnishes] clear proof of crime'" (356 U.S., at p. 154). It noted, though, that, when a civil litigant takes the stand in his own behalf, his position was somewhat analogous to a criminal defendant in that he was not forced to testify and is doing so solely as a matter of choice. In such a case, the court noted that "[the] witness himself, certainly if he is a party, determines ...