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PEOPLE STATE NEW YORK v. HERBERT COOPER (04/23/69)

COURT OF APPEALS OF NEW YORK 1969.NY.41293 <http://www.versuslaw.com>; 249 N.E.2d 469; 24 N.Y.2d 877 decided: April 23, 1969. THE PEOPLE OF THE STATE OF NEW YORK, RESPONDENT,v.HERBERT COOPER, APPELLANT Appeal, by permission of the Chief Judge of the Court of Appeals, from a judgment of the Appellate Term of the Supreme Court in the First Judicial Department, entered January 4, 1968, affirming a judgment of the Criminal Court of the City of New York (James J. Comerford, J., at time of trial; Morton R. Tolleris, J., at time of sentence), rendered in Bronx County, which convicted defendant of violating section N46-17.0 (subd. b) of the Administrative Code of the City of New York and imposing a sentence of 30 days in jail or a fine of $300, plus a suspended sentence of an additional 30 days. Defendant, as the president of Car Traders, Inc., a used car dealer, was charged with having failed to file monthly returns of the New York City sales tax due from said corporation for the months of February, 1964 through February, 1965. Norman J. Mordkofsky for appellant. J. Lee Rankin, Corporation Counsel (Samuel J. Warms, Stanley Buchsbaum and Max H. Finkelberg of counsel), for respondent. Chief Judge Fuld and Judges Burke, Bergan, and Keating concur in a memorandum; Judge Jasen dissents and votes to affirm in an opinion in which Judges Scileppi and Breitel concur.


Appeal, by permission of the Chief Judge of the Court of Appeals, from a judgment of the Appellate Term of the Supreme Court in the First Judicial Department, entered January 4, 1968, affirming a judgment of the Criminal Court of the City of New York (James J. Comerford, J., at time of trial; Morton R. Tolleris, J., at time of sentence), rendered in Bronx County, which convicted defendant of violating section N46-17.0 (subd. b) of the Administrative Code of the City of New York and imposing a sentence of 30 days in jail or a fine of $300, plus a suspended sentence of an additional 30 days. Defendant, as the president of Car Traders, Inc., a used car dealer, was charged with having failed to file monthly returns of the New York City sales tax due from said corporation for the months of February, 1964 through February, 1965.

Chief Judge Fuld and Judges Burke, Bergan, and Keating concur in a memorandum; Judge Jasen dissents and votes to affirm in an opinion in which Judges Scileppi and Breitel concur.

 Memorandum. The judgment of the Appellate Term should be reversed and a new trial ordered. Subdivision b of section N46-17.0 of the Administrative Code of the City of New York recites that a person who fails to file a city sales tax return shall be guilty of a misdemeanor. Since this statute is punitive and in view of the fact that the balance of this section, as well as analogous tax provisions of the State of New York, requires that specific acts or omissions be willful before punitive measures will be imposed, we see no reason why an exception should be made where a person innocently fails to file a city sales tax return.

Disposition

Judgment reversed, etc.

Jasen, J. (dissenting). Defendant was the owner and president of Car Traders, Inc., a used car dealership operating in New York City. He was charged with a violation of subdivision b of section N46-17.0 of the New York City Administrative Code dealing with sales tax returns. That subdivision reads as follows: "Any vendor or purchaser and any officer of a corporate vendor or purchaser failing to file a return required by this title, or filing or causing to be filed or making or causing to be made or giving or causing to be given any return, certificate, affidavit representation, information, testimony or statement required or authorized by this title which is wilfully false, and any vendor and any officer of a corporate vendor wilfully failing to file a bond required to be filed pursuant to section N46-6.0 of this title or failing to file a registration certificate and such data in connection therewith as the director of finance may by regulation or otherwise require or to display or surrender the certificate of authority as required by this title or assigning or transferring such certificate of authority, and any vendor and any officer of a corporate vendor wilfully failing to charge separately from the sales price the tax herein imposed, or wilfully failing to state such tax separately on any evidence of sale issued or employed by the vendor, or wilfully failing or refusing to collect such tax from the purchaser, and any vendor and any officer of a corporate vendor who shall refer or cause reference to be made to this tax in any sales tag, placard or advertisement in a form or manner other than that required by this title, and any vendor failing to keep the records required by subdivision six of section N46-12.0 of this title shall, in addition to the penalties herein or elsewhere prescribed, be guilty of a misdemeanor, punishment for which shall be a fine of not more than one thousand dollars or imprisonment for not more than one year, or both such fine and imprisonment. Officers of a corporate vendor shall be personally liable for the tax collected or required to be collected by such corporation under this title, and subject to the penalties hereinabove imposed."

Specifically, the defendant was charged with failing to file sales tax returns for the months of February, 1964, through February, 1965.

At the trial, defendant testified that he had delegated the duty of preparing the tax returns and writing checks therefor to a bookkeeper and that, after receiving a warrant for the taxes, for the first time learned that the returns had not been filed. He also testified that an investigation by him and his accountant revealed that the taxes had not been paid, although the corporate books indicated payment. It was claimed that his bookkeeper was guilty of embezzlement; however, no indictment was returned against her.

During questioning by the court, the accountant testified that, during his monthly examinations of defendant's books, he had never examined any checks and had not made the usual bank reconciliations. He, therefore, had not discovered the alleged embezzlement until the defendant was charged with the failure to file returns. The trial court found defendant guilty and sentenced him to a fine of $300 or 30 days, and 30 days' imprisonment. The execution of the latter was suspended.

Defendant asserts that scienter must be implied in the statute to secure a conviction. Without a showing of mens rea, he argues, his conviction constitutes a deprivation of due process and is consequently unconstitutional.

While we may not necessarily agree with the wisdom of a legislative enactment, we may not disregard the clear wording of a statute unless the result reached is clearly beyond the intent of the Legislature (2 Sutherland, Statutory Construction [3d ed., 1943], ยง 4924), or the statute is unconstitutional.

Subdivision b of section N46-17.0 of the New York City Administrative Code clearly states that "any officer of a corporate vendor * * * failing to file a return * * * [shall] be guilty of a misdemeanor".

The word "wilfully" is absent from this part of the subdivision, although it does appear at four other places in the same subdivision in the description of a number of additional criminal offenses.

There can be no doubt that the deliberate omission of the word "wilfully" from the first part of the subdivision dealing with "failing to file a return" was clearly intended to eliminate the requirement of intent.

Certainly it was within the province of the City Council to determine whether the requirement of proof of knowledge would seriously hamper effective enforcement of the sales tax regulation. That is to say, the City Council could reasonably have intended to establish the "failing to ...


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