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Theft is a general term embracing a wide variety of misconduct by which a person is improperly deprived of his property. The purpose of theft law is to promote security of property by threatening aggressors with punishment. Property security is valued as part of the individual’s enjoyment of his belongings and because the community wishes to encourage saving and economic planning, which would be jeopardized if accumulated property could be plundered with impunity. Another function of the law of theft is to divert the powerful acquisitive instinct from non-productive preying on others to productive activity.
One problem that dogs the law of theft, as will be seen below, is that in a commercial society no clear line can be drawn between greedy antisocial acquisitive behavior on the one hand and, on the other hand, aggressive selling, advertising, and other entrepreneurial activity that is highly regarded or at least commonly tolerated. Here two important principles of constitutional and criminal law come into play to restrict the scope of the law of theft. A criminal law must not be so comprehensive as to jeopardize the ordinary behavior of decent citizens. Nor may a criminal law be so vague that it fails to warn the citizen what is forbidden and leaves to the discretion of enforcement officers or judges whether certain behavior should be punishable. The tension between these principles, and the impulse to penalize all egregious greed, account for the fact that theft law inevitably falls short of penalizing all rascality. At the same time—such are the refractory problems of legislative drafting—it is impossible, even with the most painstaking draftsmanship, to avoid overpenalizing in some cases. For example, obviously trivial peculations such as using an employer’s stationery for writing personal notes quite clearly fall within theft law; yet it has proved impossible to articulate exceptions that will exclude this and a myriad of other trivial violations. Such things remain, therefore, within the province of prosecutorial and judicial discretion.
Within the broad category of theft, the law has long made important distinctions according to the particular means employed to appropriate the property, the nature and value of the property, the ‘‘criminal intent’’ or its absence, and other circumstances. These variables are reflected in the number of distinct criminal offenses that the law developed to deal with theft—for example, larceny, embezzlement, false pretense, fraudulent conversion, cheating, robbery, extortion, shoplifting, and receiving stolen goods. Before the emergence of the British Parliament and royal courts as the dominant lawmaking institutions, it may be assumed that all such misbehavior was subject to the rather arbitrary sanctions of local baronial justice.
A uniform central justice would first be invoked in the most serious cases, especially where capital punishment might be imposed. Thus, the great ‘‘common law felonies’’—treason, murder, arson, rape, robbery, and burglary—became the first concern. Of these, robbery and burglary were typically property crimes, but with distinctive circumstances of aggravation. Robbery with theft accompanied by personal violence was notably an offense of the highway, impairing the security of a communications network that was important to the monarchy and to commercial interests. Burglary involved violent invasion of the home for felonious purpose (not necessarily theft) at night. One may speculate that burglary was an early concern of royal courts because it, like arson, occurred as an incident of warfare among the barons or of peasant revolts. As time passed, the aggravating circumstances sufficing for royal jurisdiction of these felonies were attenuated. By the end of the eighteenth century, a purse-snatching in London would be robbery in view of the ‘‘violence’’ suffered by the owner from the momentary pull of the purse handle. A thief became a burglar if he opened the door of a henhouse on the home lot of a townsman.
Larceny, not an original common law felony, must have emerged as the royal courts extended their jurisdiction beyond robbery to reflect increasing central concern for property security generally and to control the imposition of capital punishment, a sanction often employed in the illusory hope of repressing theft. As might be expected, the initial excursion of the royal courts into the law of theft was sharply limited. Larceny was defined as taking and carrying away tangible personal property of another by trespass and without his consent with the purpose of stealing or permanently depriving the owner of possession. Consideration of the technical limits that the courts derived from, or built into, this seemingly simple definition will throw light on the way law evolves and on the process that ultimately made it necessary for Parliament and other legislatures to take up the task of extending the law of theft.
A Property Offense
Larceny deals with tangible property. There are many ways of inflicting pecuniary injury on another apart from taking his tangible property. For example, one can cheat another out of services due him, as where a municipal or corporate officer causes underlings to labor for the officer’s private benefit on time paid for by the municipality or corporation. One can cause an actor, physician, architect, or other professional to provide valuable service by false promises or representations. One can bypass the electric meter or obtain power service without paying for it. One can plagiarize another’s book or music, or ‘‘steal’’ technical information that has been entrusted in confidence. Only much later and by explicit legislation did such frauds become punishable, usually as offenses distinct from larceny.
Personal Versus Real Property
Only certain forms of property were covered by larceny law, namely, tangible personal property. In legal parlance, personal property means assets other than ‘‘real property,’’ that is, real estate. The distinction is underlined by the specification in the definition that the stolen property must be ‘‘carried away.’’ Obviously, real estate cannot be carried away. The general distinction made between real and personal property was not all arbitrary. Precisely because real estate cannot be carried off, purloined, or hidden away, there is no danger that it will disappear. Controversies over entitlement to the use and enjoyment of the land will normally be between persons having colorable title, such as co-owners or landlord and tenant. The civil law affords remedies uniquely adapted to restore possession of real estate to the persons entitled and to reimburse for lost profits. But the rationality of the basic distinction does not extend to many of the refinements invented by the courts over the course of centuries in the interpretation of the definition of larceny. (For example, a quite movable document evidencing title to real estate could be excluded from the category of ‘‘personal property.’’) Notably, the exclusion of real estate from larceny extended to crops, turf, mineral deposits, or lumber taken from the land, despite the obvious mobility and concealability of these assets and their susceptibility to stealthy removal. One can see here either the traces of a medieval casuistry whereby the mysterious essence of land is somehow infused into materials that were once a part of the land, or, more functionally in the modern spirit, a desire to avoid imposing the harsh sanctions prescribed by larceny law for minor peculations in the agricultural countryside. Other rationalizations must be found to explain why products of the land were transmuted into personal property if they were assembled in stacks or heaps before removal; it was said, for example, that manure spread upon a field was real estate, but that a manure pile was personal property within the law of larceny.
The requirement that the personal property be ‘‘tangible’’ served to exclude many forms of interpersonal economic claims from the larceny offense, including debts, contract rights, promissory notes, trade secrets, and patents. Controversies over such commercial interests, like controversies over land, were generally between identifiable rivals, not with sneak thieves, the prime target of larceny law, and these controversies could ordinarily be resolved by civil law suits. Perhaps one can see here also the beginnings of that special tolerance for what was later to be identified as white-collar crime, that is, middle-class nonviolent peculation, often by persons of the same social class as the legislators, judges, and prosecutors.
Take and Carry Away; Attempted Larceny
The requirement of proof that the property had been ‘‘taken and carried away’’ had to do with the pervasive concern of Anglo-American criminal law to avoid penalizing persons who may be thinking about or tempted to commit crime but who take no unequivocal steps toward committing an offense. Antisocial action, not bad character or evil impulse, is in principle the proper domain of the criminal law. As late as the twentieth century, however, the law of theft as supplemented by the law of vagrancy included a petty offense that consisted of being ‘‘a common thief,’’ so identified by repute, by want of an obvious source of legitimate income, and by a tendency to loiter in public places where potential victims congregate (Levine v. State, 110 N.J.L. 467, 166 A. 300 (1933)). But latter-day constitutional principles invalidate such vague laws that subject people to police action on the basis of status rather than present misconduct (Papachristou v. City of Jacksonville, 405 U.S. 156 (1972)).
What, then, is the quantum of actual misbehavior that will suffice for a larceny conviction? The answer was found in the definition of larceny insofar as it requires proof that the actor did ‘‘take and carry away,’’ that is, exercise physical dominion over the property, thus interfering with the possession of the true owner. Such interference constitutes the ‘‘trespass’’ discussed below, but more is required. The actor must move the property, however slightly; that is, begin to move it or carry it away. A culprit, observing a packing case on the loading platform of a warehouse, might go so far as to tip the case up on one corner without actually committing larceny; only if there was additional movement resulting in the displacement of ‘‘every atom’’ of the object would the offense be complete.
On the other hand, the significance of these intriguing technicalities is diminished by the fact that the suspect may be convicted of attempted larceny if he has not gone far enough to ‘‘complete’’ the crime. The law of attempt has its own requirements with regard to how far criminal action must proceed in order to cross the line between ‘‘mere preparation,’’ which is not criminal, and criminal attempt. One may therefore be guilty of attempted larceny although the larceny requirement of carrying away is not satisfied. Grave consequences turn on whether there has been a completed larceny or only an attempt. In the eighteenth century, when some larcenies were capital offenses, life or death might depend on whether the suspect had merely tipped the case on end or had moved it entirely. In modern law, criminal codes frequently set lower sentence maxima for attempts than for completed offenses.
Making important differences in potential sentence turn on nice distinctions between attempted larceny and completed larceny is additionally curious when one perceives that many ‘‘completed’’ larcenies prove, on analysis, to be frustrated, rather than successful, efforts to steal—in other words, attempts. Our culprit of the warehouse loading platform, having indeed moved the case a few inches, may desist from his nefarious purpose upon observing the arrival of a policeman. A pickpocket, having the victim’s wallet already in his grasp and having partly removed it from the pocket, may find that the alert victim has grasped him firmly by the wrist. Abandoning the tempting wallet, the pickpocket seeks only to escape. The law would hold this to be larceny rather than attempt.
Confusion is further confounded when it is observed that the ‘‘aggravated larcenies,’’ robbery and burglary, are analytically attempts, although centuries of treatment as distinct substantive offenses obscure this analytic truth. Assaults for the purpose of larceny are robbery. The slightest intrusion into a building for the purpose of larceny is burglary, although the burglar has succeeded only in inserting his screwdriver or crowbar under the window. Activity that has not accomplished its purpose falls logically into the category of attempt. There may be good reason to treat these particular inchoate larcenies more severely than the ordinary ‘‘completed’’ larceny, since the culprit manifests special dangerousness by embarking on larceny in especially frightening circumstances. Moreover, since the preliminary steps taken for the purpose of larceny, that is, assault and trespass, are themselves criminal offenses, it is possible to regard the purpose to steal as merely an aggravating circumstance attending the commission of those ‘‘completed’’ offenses. But these explanations leave undisturbed the perception that the mere distinction between attempt and completed larceny hardly suffices to justify special leniency toward culprits who do not fully accomplish their larcenous purposes.
By Trespass and Without Consent
Extraordinary extensions of larceny law were accomplished by daring judicial pronouncements in the eighteenth century with regard to the central concept of larceny—that an owner’s possession must be shown to have been disturbed without his consent, a disturbance known in law as ‘‘trespass’’ (Rex v. Pear, 168 Eng. Rep. 208 (Crown Cases 1780)). The one thing the old English judges did not want to be involved in as administrators of the criminal law was quarrels between an owner and one to whom the owner had entrusted his property for such purposes as to sell, store, transport, repair, process, or invest. These relationships, known in law as bailments, were perceived as quintessentially civil matters of contract. A merchant must take his chances and could minimize his risks by care in selecting those to whom he entrusted goods. Moreover, if criminality were to depend on the bailee’s having done something not authorized by the contract of bailment, there was the difficulty of proving exactly how far that authority went. This would depend on customs of the trade and, frequently, on verbal understandings of ambiguous import. The circumstances, in short, were altogether different from the typical larceny involving a thief without a shadow of claim of right.
There is one situation where a matter that has the appearance of consent by the owner does not bar conviction of larceny. That is where the owner of goods, suspecting that his employees are stealing, purposely exposes the goods to easy taking while concealed law enforcement officers keep the scene under surveillance in order to apprehend the thief. The owner obviously does not consent to be deprived of his goods; indeed, he has taken effective measures to prevent loss of the decoy. Although the case can thus be disposed of under substantive larceny law, it is closely intertwined with an independent problem of law enforcement procedure, that of entrapment. It is lawful for police to ‘‘provide an opportunity’’ to commit crime, but not to ‘‘induce’’ by methods that would overcome the resistance of an ordinary law-abiding citizen, the commission of an offense by one not shown to be predisposed to commit the offense. The police have on occasion conducted large-scale enterprises in which, with appropriate publicity in the underworld, they engage in buying stolen goods, while a secret camera photographs the sellers. The encouragement to theft given by this ready market supplied by law enforcement officers does not constitute illegal entrapment.
‘‘Custody’’ Versus ‘‘Possession’’
Consider, then, what is to done with the butler who, while polishing his master’s silver, is overcome by the temptation of illicit gain and absconds with the family plate. Is this to be regarded as ‘‘bailment’’? Has milord, who may reside in distant London, voluntarily transferred ‘‘possession’’ to the trusted butler, so that the butler’s misappropriating what is rightfully in his own possession cannot amount to a ‘‘trespass’’ against his master’s possession? As early as the sixteenth century, the lordly gentlemen of the bench sought to find their way past such obstacles so as to convict the butler of larceny. They did so by perceiving or inventing a distinction between ‘‘possession’’ and mere ‘‘custody.’’ A servant had mere custody; he held the master’s belongings only as a proxy for the master. Thus the master retained ‘‘possession,’’ and the servant committed trespass against the master’s possession when he carried off the plate. A similar extension was easily made in favor of merchants, whose clerks and apprentices in stores, banks, and factories were treated as holding mere custody of goods that remained in possession of the employers.
Trespass By Bailee in Possession
Economic and social pressures mounted in favor of applying theft sanctions to bailees. With increasing specialization of labor and increasing nationalization of the market, more and more goods were unavoidably entrusted to other participants in the process of production, transportation, and marketing—participants who most certainly were not servants but ‘‘independent contractors,’’ that is, bailees. Theft law began to respond as early as the fifteenth century, but fitfully. A hauler entrusted with a case of goods was convicted of larceny when he broke the case open and helped himself to the contents (The Carrier’s Case, Y. B. Pasch. 13 Edw. IV, f. 9, pl. 5 (Star Chamber 1473)). The judges could bring themselves to say that the case, but not the contents, had been delivered into the possession of the hauler by consent of the owner. The contents thus remained in the possession of the owner, against which possession the hauler had committed trespass.
Larceny By Trick
A famous prosecution in the eighteenth century involved an accused who hired a coach and horses for a specified trip and duration, although his real purpose was to make off with the coach and dispose of it. There could be no question that the transaction began as a bailment. But the court was willing to say that ‘‘possession’’ reverted to the lessor upon breach of the bailment contract, so that the lessee trespassed on the lessor’s possession. Moreover, in the court’s view, the voluntary aspect of the initial delivery of the car to the bailee was vitiated by the bailee’s fraudulent misrepresentation of his intentions. Fraud in inducing a transfer of possession vitiated the apparent ‘‘consent’’ of the bailor to the change of possession. This was the famous ‘‘larceny by trick,’’ a far cry from the archetypal covert snatch, and ancestor of the legislation to come that would penalize obtaining property by false pretenses even when the transaction induced was a transfer of money or other property, a change of ownership rather than merely possession as in larceny—in short, a sale.
Lost or Abandoned Property
If an owner abandons or loses, that is, loses possession of, his property, another’s taking of it is not a trespass against the owner’s possession; hence no larceny. However, the interests of property losers eventually received some criminal law protection. It had long been recognized that an owner possessed goods, in the sense that he asserted continued dominion over them even if he were far from them and thus in no position to exert immediate physical control. Ingenious judges availed themselves of this idea by drawing a distinction between lost and ‘‘mislaid’’ property. Thus, a cab driver who appropriates a wallet that a passenger has inadvertently left on the seat or dropped to the floor takes ‘‘mislaid’’ rather than ‘‘lost’’ property, trespassing against the owner’s continued ‘‘possession.’’ Nevertheless, there was reluctance to extend the harsh penalties of larceny to finders, who do not aggressively act against the property security of others. Their misbehavior, if it be such, consists of a failure to take steps to restore property to its true owners. Anglo-American law has traditionally been adverse to penalizing inaction, and in the lost-property situation, to make a thief out of a finder runs counter to the folk wisdom of ‘‘finders, keepers.’’ Special legislation has been passed to define the affirmative action required and to penalize only egregious departures from ordinary standards of behavior, as where the property has substantial value, the identity of the owner is manifest, and the property can be restored to the owner without disproportionate effort and expense. Violation of such a duty of affirmative action would not ordinarily be characterized as theft, and the maximum authorized sentence would be much lower.
Larceny Within The Family
The ideas of trespass and consent played a special role in determining the criminality of theft from a spouse. Before the ‘‘separate property’’ legislation of the nineteenth and twentieth centuries, the husband’s plenary power to dispose of his wife’s personal property made it technically difficult to regard any action of his as a trespass against her property. Accordingly a husband could not be convicted of larceny of his wife’s belongings. The wife had a corresponding immunity against prosecution for stealing from the husband. This immunity would be rationalized on the theory of the ‘‘unity’’ of husband and wife or on the theory that, since her property was in any event subject to his dominion, her ‘‘taking’’ was not a trespassory disturbance of his possession. But behind these fictions lay substantive psychological considerations. In most households the stock of commonly held available belongings is regarded by the spouses as being in their joint possession; presumably they consent to each other’s appropriations, at least for the common ménage. Even if such consent is explicitly withdrawn in a particular situation, criminal prosecution of one spouse on the testimony of the other hardly seems an appropriate remedy for the underlying marital discord.
Moreover, it would be perceived by prosecutors, judges, and the public that a ‘‘thief’’ whose disregard of others’ ownership is manifested only by taking something belonging to his or her consort is hardly a threat to the general security of property. Police experience has long recognized that prosecution under these circumstances will probably be abortive, for the complaining party frequently repents of hasty invocation of official intervention and refuses further collaboration with the prosecution. If willingness to carry through with prosecution is rare, the cases that do occur are likely to be manifestations of vengefulness or blackmail, in which it is hardly right that officialdom should aid. Such an analysis leads to the conclusion that neither wife nor husband is liable to conviction for larceny from the other. In modern times some of the states recognize bispousal immunity, whereas others follow the logic of the separate-property legislation by abolishing all interspousal immunity for theft. Prosecutions remain rare.
A sensitive legislator or judge will see the spouse-theft problem as only one example of a set of situations that seem to call for consistent treatment. What is to be done with couples who live together without being legally married? What about theft by children from parents, or among brothers, sisters, and other members of the family living in a common household? What about non-family-related joint living arrangements? In all these situations there is likely to be considerable tolerance for, if not actual consent to, some appropriation of one another’s goods, the miscreant does not show himself as generally thievish merely by taking what seems to him part of a commonly held stock of goods, and a complainant is likely to desert the prosecution once it has been initiated. Nevertheless, the law that declares such peculations to be punishable larceny has been only rarely and marginally changed. It is left to the discretion of prosecutors to decline to bring charges, or to the discretion of judges to impose only lenient sentences upon proof of the mitigating circumstances that the goods were temptingly available as part of a household of which the defendant was a member.
Much is learned about criminal law generally by reflecting on the reasons for a seemingly arbitrary distinction between immunity for interspousal larceny and discretionary leniency for other intrafamily larceny. The basic reason is that it is virtually impossible to draw a defensible line anywhere along the spectrum of increasingly attenuated personal relationships: too many cases would be swept into the immunity category. For example, a son at the culmination of a series of quarrels with his father leaves home with the family car and his mother’s life savings. An orphaned youth taken into the family quickly departs with Grandma’s jewelry. Moreover, even the most generous immunity rule would exclude some cases that necessarily must be handled by discretionary leniency, for example, the young clerk who, in a moment of personal crisis, appropriates the wallet that a customer has left on the counter. If temptation and availability should be a defense to prosecution for larceny, the law would be sending very ambiguous signals to those whom it would like to deter, and the security of property might be substantially impaired.
It should be remembered that in all these family cases the defendant may have a complete defense that the owner had actually consented to the particular taking. Consent need not be explicit, but may be implied from previous practices. Moreover, once the defendant has introduced some evidence of consent, the prosecution has the burden of disproving consent beyond a reasonable doubt, since nonconsent is an element of the offense.
The Larcenous Intent
Generally speaking, serious crimes such as larceny cannot be committed unknowingly or innocently. There is a requirement of mens rea (wickedness or evil intent). Three aspects of this psychological component of larceny are worth discussing here: (1) purpose to appropriate; (2) claim of right; and (3) permanence of intended deprivation.
Purpose to Appropriate
Purpose to appropriate serves to differentiate acquisitive misbehavior from destructive behavior—that is, larceny from malicious mischief. The classic Latin formulation was lucri causa (‘‘for the sake of gain’’). Vandalism of property has always been regarded as a less serious offense, although that is by no means a self-evident proposition, considering that stolen goods remain part of the social stock, since they are merely redistributed, whereas destroyed things are irretrievably lost. On the other hand, temptation to acquire illicitly seems to be much more pervasive. Yielding to it leads readily to the adoption of thievery as a way of life. A clever thief can become a professional criminal and make a living without the labor endured by his honest and indignant fellow citizens. Accordingly, if I take my neighbor’s vase meaning to make it my own or to sell it, I am guilty of the felony of larceny (or one of the modern composite theft offenses of which larceny becomes a component); but if I merely toss it to the floor, shattering it, that amounts only to the misdemeanor of property destruction or malicious mischief. Interesting variants can occur, as where the culprit first ‘‘appropriates’’—that is, takes and carries away—and thereafter destroys. He is guilty of both offenses even if the original taking was with purpose to destroy.
Purpose to appropriate means that one cannot be guilty of larceny by taking what he believes, however unreasonably, to be his own, for one does not intend to ‘‘appropriate’’ what is already his own, or to deprive another. There is lacking the thievish state of mind that would identify the taker as a threat to the property of others. In some connections, such as homicide, the law recognizes ‘‘recklessness’’ as a sufficient mens rea; but in the case of larceny even the most careless mistake as to ownership will absolve the accused. In the jargon of the law, larceny is a crime requiring ‘‘specific intent,’’ that is, the conscious purpose to trespass against another’s right of possession.
Yet there is a class of situations involving ‘‘claim of right’’ where the accused’s subjective good faith will not save him from conviction for larceny. If a man appropriates property that he knows to belong to another, he commits larceny even if he takes the property to satisfy a real or supposed obligation that is due from the owner. Thus an employee who believes that the employer has illegally withheld wages may not with impunity help himself to a corresponding amount of the employer’s cash or goods. A farmer who thinks or, for that matter, knows that his neighbor has stolen one of his calves violates the larceny law if he helps himself to an equivalent calf belonging to the neighbor. In sum, the defense of claim of right requires a showing of belief that the actor owned (or otherwise had the right to possession of) the specific article, not merely that he was entitled to some form of compensation. It seems doubtful whether creditors’ self-help is sufficiently analogous to the basic misbehavior condemned by the law of theft, or sufficiently identifies the actor as an egregious threat to the property interests of others, to warrant social castigation as a thief. Yet in the absence of alternative categories of minor crime into which creditor self-help might be fitted, society has chosen to leave to prosecutorial discretion whether such over-zealous creditors should be prosecuted as thieves.
Intent to Deprive Permanently
This aspect of the definition of larceny serves to exclude unauthorized borrowing from larceny. In general, temporary takings ought to be excluded from larceny, although it is worth noting by way of anticipation that when the issue is embezzlement rather than larceny, even temporary misappropriation by a trustee, agent, or other fiduciary leads to conviction. The courts have shown no disposition to hear a lawyer or stockbroker say, ‘‘I took my client’s securities or cash only briefly to meet an urgent need of my own and with full intent to return the property.’’ Larceny borrowings, however, would ordinarily not involve large sums of liquid assets that can readily disappear, nor is there involved the aggravating circumstance that the culprit breached a strong duty of fidelity he owed to the owner who had entrusted property to him. The harm done when an ordinary tool, article of clothing, or bicycle is borrowed without permission is minimal if the object is returned promptly in good condition. The possibility of professional thievery based on illicit borrowing is remote.
However, there are many situations in which borrowing without the owner’s consent presents a serious enough risk of substantial loss as to warrant excluding a defense that the taking was without intent to deprive permanently. The courts readily convicted of larceny where the taker had only a conditional intent to restore the property, that is, if the owner would pay a reward. So also where the taker, although abjuring any purpose to appropriate permanently and, indeed, professing hope that the property will be regained by the owner, deals with the property in a way that reveals his essential indifference to returning the property. Having ‘‘borrowed’’ a shotgun from his neighbor’s barn to go hunting, he abandons it in the woods. Such recklessness regarding restoration of the property was held sufficient mens rea for larceny.
A second category identified by modern reformers as appropriate for larceny conviction despite the alleged intention of the taker to restore the property is where the property is withheld ‘‘under such circumstances that a major portion of its economic value or its use and benefit has in fact been appropriated.’’ This formulation was adopted in the Model Penal Code of the American Law Institute (§ 223.0) and in the Proposed New Federal Criminal Code of the United States National Commission on Reform of Federal Criminal Laws (§ 1741 (b)). Thus, the draftsmen sought to extend larceny to cases such as the prolonged ‘‘borrowing’’ of an art treasure or the surreptitious ‘‘borrowing’’ of a mowing machine precisely for the season in which the owner would need it.
A third category of criminal borrowing, of great practical importance, is dealt with by the so-called joyride statutes. These laws penalize unauthorized borrowing of automobiles or other vehicles. One of the commonest offenses committed by youths in an automobile civilization is to take an available car for a fast (and risky) drive, without any intention of keeping the vehicle. When abandoned, it will soon be restored to the owner by the police. The great risk presented by this activity—not only to valuable property but also to the lives of those encountered on the highway—led to penal legislation against it, sometimes by way of expanding larceny, and sometimes under a nonthievery designation. How far should the principle be extended? To boats, motorcycles, and airplanes, clearly. But should it also be extended to other motor-propelled vehicles, including snowmobiles, motor scooters, parachutes, and hang gliders? Should special laws be enacted to penalize unauthorized borrowing of dangerous machines, nuclear materials, or guns? Does the number of exceptions from the principle of penalizing only permanent deprivations multiply so uncontrollably that the principle itself should be abandoned except for the most trivial borrowing of personal belongings, thus leaving it to the discretion of prosecutors and judges which illegal borrowings should be prosecuted and punished?
Statutory Dilution of Intent Requirement
It is not uncommon for legislatures to push the concept of larceny beyond its traditional boundaries, including the boundary of larcenous ‘‘intent.’’ A notable example was the statute involved in Morissette v. United States, 342 U.S. 246 (1952). Here Congress, not content with providing up to ten years’ imprisonment for ‘‘stealing’’ anything of value belonging to the United States, added that anyone who ‘‘knowingly converts’’ federal property should be dealt with similarly. The defendant, a junk dealer, had picked up spent air force bombing cases on an air force bombing range, believing, he claimed, that the air force had abandoned them. Such a defense would undoubtedly be valid against a charge of stealing or larceny. The prosecutor relied on the ‘‘knowing conversion,’’ a term taken from civil law, where it refers to the owner’s right to be reimbursed for property appropriated, whether or not with intent to steal. It could be argued plausibly that Congress must have intended to go beyond the traditional larceny intent when it explicitly added conversion to the theft statute. Nevertheless, the Supreme Court rejected the argument, pointing to the infamy of a conviction for theft, the long tradition of requiring specific intent in this offense, and the less-than-perfect clarity of Congress’s will to weaken the traditional requirement.
In the eighteenth and nineteenth centuries the pressures to extend theft law beyond the ‘‘trespass’’ limits of common larceny became irresistible. An offense had to be created to penalize the defalcations of bailees, trustees, and the like who clearly did not wrongfully infringe on the possession of others, since they had themselves been put in possession either by the owners or by authority of law, as where an executor, administrator, or trustee took property under a will subject to a fiduciary obligation to administer for the benefit of heirs. Embezzlement is, then, misappropriation of the property of another when that property is already in possession of the embezzler. The law expanded cautiously, as might be expected, since the objections to an expansive theft law, which had been felt in connection with larceny, did not evaporate. Initially only a few of the numerous classes of potential embezzlers, such as fiduciaries and haulers, were named in the statutes. Eventually the coverage of the embezzlement statutes was enlarged to cover anyone who had property of another in his own possession.
One of the objections to expanding theft law—the harshness of larceny penalties—was met by providing milder although still heavy sanctions for embezzlement, thus introducing the somewhat surprising phenomenon that different forms of theft would be treated with varying degrees of severity depending on the historic moment when a particular expansion of theft law was effectuated. A major peculation by a trustee or bank official might carry a lesser penalty than a minor trespassory larceny, although many would consider that the former was the more heinous and harmful behavior. Over a period of time the severity of larceny penalties gradually moderated; and ultimately, when various forms of theft were consolidated into a single offense, the same statutory maximum would become applicable to both larceny and embezzlement.
‘‘Misappropriation’’ is the criminal act that characterizes embezzlement, just as ‘‘taking’’ characterizes larceny. It is generally more difficult to decide whether misappropriation occurred than to decide whether property was unlawfully taken. A real estate broker or a lawyer, for example, may receive the proceeds of a sale or property or money recovered in a lawsuit. It is easy to say that such monies are misappropriated if the broker or lawyer pockets the whole fund and spends it for his personal needs. But what if the broker deposits the buyer’s check in the broker’s personal bank account, meaning to write a check later payable to the client for the amount of the proceeds less commission? That way of handling the transaction may violate standards of professional behavior which explicitly require clients’ funds to be deposited and held in separate accounts; but it would be a harsh rule that transformed every violation of prophylactic professional regulations into a severely punishable theft. Ethical codes of the professions generally provide lesser sanctions, such as reprimand or suspension from practice, and no ethics committee of a professional association should have the power to redefine crime by changing its rules of ethics. On the other hand, the mere fact that an act violates professional standards should not immunize professional misbehavior from criminal sanctions that apply to identical conduct engaged in by nonprofessionals.
Perhaps the resolution of this dilemma lies in the proposition that identical acts have different significance in different circumstances. If I give my friend $1,000 with which to pay my bills while I am on a long journey, and he deposits the money in his own account to avoid the inconvenience of opening a separate account, it would be unreasonable to conclude that he is misappropriating my property. However, if I give money to my lawyer to pay a judgment against me and the lawyer deposits it in his own account, quite different implications may arise. For the lawyer, having a separate account for clients’ funds is no temporary or occasional need but part of the normal way of doing business, explicitly mandated by codes of professional ethics. Accordingly, the commingling of client funds with personal funds ordinarily represents not merely a lazy avoidance of minor inconvenience, but rather a significant and, for the professional, unusual choice among available accounts. In short, the lawyer appears to have taken the first step toward applying the client’s money to his own private use. One could call that preparation or attempt to misappropriate the money, the offense becoming complete later when the lawyer draws checks on the account to pay his personal bills. However, the law chooses to treat the initial deposit in the lawyer’s account as already an exercise of hostile dominion over the entrusted fund. Just as has been seen above in the case of larceny, the logical distinction between attempted and completed theft is not always maintained. The ambiguity of ‘‘misappropriation’’ is further illustrated by cases where an agent has been convicted of misappropriating a check made out to his principal even though he deposits that check in his principal’s account. This result has been reached in situations where the agent, owing the principal money on account of earlier transactions, covers up the shortage by depositing current checks with vouchers falsely attributing them to the earlier transactions. Because of the false accounting, the agent is seen as having applied the current checks to his own purposes, squaring himself with the company, and thus misappropriating.
An extreme and dubious extension of the concept of misappropriation is expressed in some statutes that make any shortage in the accounts of a public official a basis for convicting him of embezzlement. The reasoning goes as follows. There is proof that the official received X amount, as tax collector. He has on hand only X minus Y. Thus he must have misappropriated Y, or at least failed to exercise proper care in collecting, conserving, or disbursing tax monies. Such reasoning and legislation confound theft with negligence, or, even more at variance with Anglo-American traditions, seeks to facilitate convicting an official of a presumed embezzlement by eliminating the necessity of proving misappropriation.
Property of Another
The embezzlement statutes transcended the difficulties experienced in larceny law over the kinds of property covered. One can embezzle real as well as personal property, negotiable instruments and securities as well as tangible physical goods. But limiting embezzlement to ‘‘property’’ plays an important role in one class of situations, namely, where it may be necessary to decide whether a defendant exerted control over property belonging to another or whether instead he merely failed to pay a contracted debt owed to the other. The distinction is of constitutional importance where imprisonment for debt is constitutionally forbidden. It is, in any event, important from a policy viewpoint because putting the force of the criminal law behind fulfillment of contracts would have immense social and economic implications. Department stores, banks, credit card agencies, and other creditors would then be able to call upon prosecuting attorneys to aid in collections, the threat of jail for defaulting debtors would be legitimated, and creditors, especially of the poor, would be partially relieved of the necessity of carefully screening their extensions of credit.
Distinguishing property from contract obligations is not always easy. One tends to think of ‘‘having’’ money in a bank, whereas the true relationship is that depositing money ‘‘in’’ one’s bank account, unlike stashing it in a safe-deposit box, is in effect a transfer of ownership to the bank. Thereafter the bank merely owes money to the depositor. That means that the banker may, the moment he has the depositor’s cash in hand, use that cash as he will. He does not misappropriate it even though he proceeds forthwith to the racetrack, where he loses it all at the betting windows. That may violate certain banking laws; it is not theft.
The niceties to which the distinctions between property and contract can give rise are illustrated by Commonwealth v. Mitchneck, 130 Pa. Super. 433, 198 A. 463 (1938). Mitchneck operated a small coal mine during the Depression of the 1930s. He had an arrangement with the miners whereby they could obtain groceries from a storekeeper on credit. Mitchneck would pay the grocer and deduct the amount from the miners’ paychecks. At some point, Mitchneck found himself unable to pay the grocer, although he had deducted the grocery bills from the wage payments. That is to say, the cash withheld from wages had gone either into Mitchneck’s pocket or to pay some of Mitchneck’s more pressing bills. The theory of the prosecution was that the defendant had misappropriated money belonging to the miners. The prosecution failed because Mitchneck never had any of the miners’ money; he had merely paid them less than was owed in wages, and continued to owe the balance. He had only broken his contract with his employees to pay their grocery bills. So also vis-à-vis the grocer: Mitchneck had merely violated his agreement to pay the grocer if the grocer extended credit to the miners. By reflecting on the different result that would have been reached if there were a slight change in the facts, one can see how close this decision was to the line.
If the arrangement at the office of Mitchneck’s paymaster had been that the employees filed past two windows, receiving full wages at the first and paying their grocery bills at the second, an embezzlement conviction would have been possible because payments at the second window would have put money belonging to the miners in Mitchneck’s hands. Whether an embezzlement conviction would actually have been sustained would depend on analysis of the transaction at the second window. If the understanding was that Mitchneck would hold these monies in a special drawer or account reserved for the grocer, his dipping into that drawer or account would have been embezzlement. But if the understanding went no farther than Mitchneck’s undertaking a contractual obligation to pay the grocer, the miners’ payments to him would have given rise only to an indebtedness by Mitchneck. Failure to pay a debt is not embezzlement.
Intention and Motives
The statutory definitions of embezzlement include no express requirement that the culprit means to deprive the owner permanently. Accordingly, unauthorized ‘‘borrowing’’ of trust funds by a trustee or of a customer’s securities by his broker is embezzlement. It will be observed, however, that these examples involve valuable liquid assets that are jeopardized by deviation from propriety in handling them. The cases thus resemble larceny cases where, despite a professional intention to deprive the owner only temporarily, the borrower disposes of the property in a way that creates a high risk that it will not be restored. Moreover, cash or fungible securities ‘‘temporarily’’ borrowed are unlikely to be literally returned; the borrower intends to return equivalent money or securities, which is to say that the intent is to pay at some time in the future for what is presently taken. The kind of trivial borrowing that escapes punishment as larceny might also be excluded from embezzlement by finding that no ‘‘appropriation’’ had occurred. The executor of an estate who lets his daughter take a ride on a bicycle that is part of the estate is not only unlikely to be indicted, as a matter of the prosecutor’s discretion, but also is probably immune under the law of embezzlement.
Beneficent motives do not bar prosecution for theft, whether by larceny or embezzlement. Such ameliorating circumstances are considered only by the prosecutor in determining whether to lodge charges, or by the sentencing judge. Thus, stealing for charity or out of necessity is as criminal as stealing out of greed. A mother who ‘‘steals’’ narcotics from an errant son in the hope of saving him from addiction is theoretically guilty of larceny. A trustee holding property subject to restrictions in a will that forbid investment in anything but first mortgages of government bonds is guilty of embezzlement if he invests instead in gold or oil, hoping thus to multiply the return for the benefit of the charity named in the will or the testator’s grandchildren. Some embezzlement laws expressly state that appropriation is covered whether the appropriation is for the use and benefit of the trustee or ‘‘for the use of another.’’ Even without such explicit provision, the courts would hold that improper disposition of property by a fiduciary, however kindly intended, was an unlawful assertion of dominion by the fiduciary and an appropriation for his own psychic satisfaction.
We have come a long way from the core concept of thievery to a kind of penal sanction against violation of codes of good behavior for fiduciaries. Perhaps a completely rational—that is, ahistorical—theft law would be cut back to the old common law notion of lucri causa. That is, theft would be limited to acquisitive behavior for the sake of gain. But doing this would entail creating additional penal offenses, outside of or auxiliary to the theft legislation, to deal with specific property offenses not for the purpose of gain: compare the traditional ‘‘malicious mischief ’’ law.
False Pretenses and Fraud
Larceny and embezzlement deal with takings and appropriations without the consent of the true owner. It is necessary now to confront the question of how far the penal law should go where the owner is not merely deprived of possession or enjoyment of his property, but voluntarily transfers his title to the property, as where he is induced to sell the property or to part with money as a result of trickery or misrepresentation by the other party to the transaction. The expansion of common law larceny to include ‘‘larceny by trick’’ in cases where the theft obtained possession by deception has already been noted. But this covered a small fraction of the domain of fraud because it was limited to transfers of possession. If the swindler induced the owner to part with title, that is, to sell or otherwise transfer ownership, the transaction was seen as falling within the realm of contract or commerce.
A number of reasons conjoined to delay the advance of penal regulation in this area. With regard to controversies between merchants, there was a long history or special tribunals and guild regulation that must have seemed to them preferable to the heavy-handed intrusion of national law and officials. With regard to protection of the ordinary citizen and consumer, the ancient common law misdemeanor of ‘‘cheating’’ might have been cited as filling most of the need. That reached the use of false weights and measures or other devices by which the public generally was mulcted. It did not, in principle, inquire into single transactions, where bargainers were supposed to protect themselves (‘‘Let the buyer beware!’’). To a cautious eighteenth-century legislator or judge, it would have seemed dangerous, paternalist, and a nuisance to involve the high courts in such trivial, nonviolent controversies. Dangerous, because conviction would so often depend on appraisal of the complaining victim’s credibility and that of the defendant, who in the early days at least could not testify in his own defense and enjoyed limited or no assistance of counsel. Moreover, it would have been evident to opponents of penalizing ‘‘private’’ fraud that there would be serious difficulties in distinguishing substantial deception from sellers’ exaggeration of value and other conventional puffing of wares (Rex v. Wheatley, 96 Eng. Rep. 151 (K.B. 1761)). Such concerns would manifest themselves during the eighteenth and nineteenth centuries in the first penal laws against private fraud by the very narrow limits placed on the kind of misrepresentation that would be criminal. To this day, under the Penal Code of France mere lying by one party to bargaining is not criminal. To prove criminal fraud the prosecution must also show a ‘‘mise-en-scène,’’ that is, a stage setting for the lie such as would inveigle even skeptics.
The first falsepretense statutes were couched in terms of obtaining money or other property by means of a knowingly false and fraudulent misrepresentation of fact. We may pass without further comment the conventional restriction of this new theft law to theft of ‘‘property,’’ and defer for a moment discussion of ‘‘knowingly false and fraudulent.’’ What would constitute a sufficient ‘‘misrepresentation of fact’’? That question may be best be answered by specifying what was not included.
The false-pretense laws did not create an affirmative obligation to tell the other party to a bargain everything that he might like to know. Silence is not misrepresentation, even when it is obvious that the other party labors under a misunderstanding. The antiques dealer may acquire Grandma’s rocking chair for one-tenth of its market value, she being manifestly ignorant of the fact that it is a rare piece of seventeenth-century Americana. The oil company may send its disguised agent to buy Farmer Brown’s land cheap without telling him that oil has been discovered on adjoining land. Not until the enactment of the twentieth-century ‘‘blue sky laws’’ and the federal Securities Act of 1933 did affirmative disclosure become an obligation enforced by penal law, and then the obligation was particularized by specific questions that the promoter was obliged to answer in the registration forms drafted by the enforcement agency. The principle has been extended to other kinds of promotions, such as land sales and franchising.
Opinions and Promises
Opinions, including most certainly the seller’s expressed opinion of the value of his goods, were not treated as punishable misrepresentations of fact under the typical false-pretense statute, however clear the proof might be that the seller did not hold that opinion. Promises, predictions, and statements of intention were not covered, however clear the proof that the promisor did not intend to perform or did not believe his prediction. Although modern courts are willing to regard such deception as factual misrepresentation of the state of mind of the swindler, the earlier attitude was that the true state of mind of the accused with respect to promises and intentions incident to a bargain seemed too chancy an issue for a criminal trial. Moreover, penalizing false promises would seem as dangerously close to using criminal law to enforce debts and other contracts. True, such a law would reach only promisors who did not at the time of promising mean to abide by the promise, so that honest promisors would, theoretically, not be imperiled. But again, who could judge reliably the subjective good faith of a promisor? Every user of a credit card, every borrower from a small-loan company, every purchaser on deferred payment, would be in jeopardy if at the time of the transaction his financial condition and prospects were so unfavorable as to give rise to an inference that he knew he would be unable to pay the obligation when it came due.
Misrepresentation of Law
Nothing would have seemed more self-evident to lawyers and judges than the dichotomy of law and fact; and a statute penalizing misrepresentation of fact must, especially in view of the libertarian principle that penal statutes are to be ‘‘strictly construed,’’ not be extended to misrepresentation of law. Misrepresentation of law was not covered. This result was facilitated by a mechanical misapplication of the adage that everyone is presumed to know the law. That adage properly applies only to exclude the defense, in any criminal prosecution, that the accused did not know that his behavior was prohibited. Of course, a misrepresentation of law might under some circumstances escape the false-pretense statute by being couched as an expression of opinion. But it seems clearly arbitrary to give categorical immunity to such knowingly false representations as ‘‘This transaction is tax-exempt,’’ ‘‘This insecticide may be lawfully used in this state,’’ or ‘‘This insurance policy cannot be legally terminated for any reason.’’
Materiality of Misrepresentation
Since the false-pretense statute speaks in terms of obtaining property ‘‘by means of’’ misrepresentation, a causal relation between the swindler’s deception and the victim’s loss must be shown. For example, if the victim knew the true facts, it could not be said that he parted with his money as a result of the misrepresentation, although the swindler might in such situations be guilty of attempt to obtain by false pretense. It was not necessary that the false pretense be the sole cause of the harm to the victim: deception by others, false rumor, or the victim’s greed or self-deception might be contributory causes without immunizing the swindler’s fraud.
The idea that the misrepresentation must be material is linked to the causation element of the offense. A salesman may feign a joviality or enthusiasm he does not feel. He may assume a name other than his own, pretend to be rich or pious, or falsely claim membership in a lodge or a veterans’ association. Except where such identifications are relevant to an extension of credit to him, they would be held immaterial to the transaction, that is, presumptively not causative. This would be the case even if it could be proved conclusively that the victim would not have entered into the transaction but for a deception of this sort, as where the victim was intensely prejudiced against the race or religion of the salesman, who consequently misrepresented himself in that respect while avoiding all deception as to the mercantile aspects of the deal.
It is thus apparent that the requirement of materiality goes beyond the question of actual causation, and enables the courts to disregard some effective deception for reasons of policy. In effect, it is held that some methods of advertising and ‘‘hard sell,’’ although possibly reprehensible, are so pervasive and so uncertainly separable from laudable business activities as to call for repression by less drastic methods than the penal law, for example, by affirmative administrative regulation of competitive practices.
Transcending The Limitations of The Early False-Pretense Statutes
Beginning in the nineteenth century, mounting social pressures to penalize all sorts of swindling led to judicial evasion of the limits fixed by the false-pretense statutes and to supplementary legislation, culminating in the federal Mail Fraud Act, which reaches every trick, artifice, or scheme to defraud (18 U.S.C. §§ 1341–1342 (2000)). Judicial expansion of the concept of criminal false pretenses often rested on the incontrovertible proposition that misrepresentations need not be express but can be implied. Thus, granting that omission is not to be penalized, the stock salesman who garnishes his expressed rosy view of the company’s profitability (mere ‘‘opinion’’ and ‘‘puffery’’) with the reassuring statistic that the stock has earned an average profit of 20 percent for the last ten years might nevertheless be convicted on a showing that he omitted to state that all the earnings had been in the first year, with steady losses thereafter. Notwithstanding the literal truth of the ‘‘average’’ figure, there would be a finding of an ‘‘implicit’’ misrepresentation that 20 percent was typical of recent earnings.
In the same way, opinions might give rise to implied representations of underlying fact. For example, if a stock salesman assured the customer that the share were nonassessable, when he knew that in fact the necessary steps had not been taken to qualify for nonassessability, he implicitly misrepresented those facts. Opinions were, in any event, not ruled out as a basis of liability if given by one who spoke with purported professional expertise, such as a lawyer, doctor, or disinterested appraiser. Even promises might be brought within the literal scope of ‘‘misrepresentation of present fact’’ when some courts began to view the promisor’s state of mind as a ‘‘fact like the state of his digestion.’’ The promise could be said to imply that the promisor then had in mind a good faith purpose to perform.
The Mail Fraud Act incorporates the broadest definition of criminal fraud. Any ‘‘trick, scheme, or device’’ suffices for conviction, and false promises are explicitly included. Opinion, value, or law may be the subject of material deception. Materiality does not totally disappear as a criterion, but a misrepresentation that, standing alone, would have been held immaterial under a false-pretense statute may figure as one element of a ‘‘scheme to defraud.’’ The Mail Fraud Act is not confined to obtaining property; a ‘‘scheme to defraud’’ obviously may be directed at defrauding others of valuable services. Indeed, it has been held that the government is defrauded where its normal administrative processes are vitiated through the exercise of improper influences upon officials.
Even the criminal-intent requirement has been somewhat diluted so as to come very close to penalizing reckless as well as knowingly false representations. This result was reached by holding that a promisor’s state of mind is a fact that may be misrepresented. Thus, a promoter who makes confident predictions of profit in order to sell securities may be convicted of mail fraud if he is far less confident than he represents himself to be and omits to disclose circumstances that impugn that confidence. Being sanguine himself, he actually believes what he asserts, so that he acts in good faith and without intent to deceive. The prediction is honest but reckless. Or, stated more cautiously, the promoter, aware of his own secret doubts, knowingly misrepresents the extent of his confidence (Knickerbocker Merchandising Co. v. United States, 13 F. 2d 544 (2d. Cir. 1926)).
Mail fraud is a peculiarly American phenomenon that deserves a word of explanation. In principle, under American federalism ordinary crime is the concern of the states rather than of the federal government. The federal government would naturally promulgate penal law relating to treason against the United States, to enforcement of federal tax and customs laws, and to perjury committed before the federal courts and agencies. Theft law, under this concept, would fall within the domain of the states, as do murder, rape, arson, burglary, and assault. But the line begins to blur. Theft of federal property seems to demand uniform national law and enforcement, and appropriate legislation is enacted. As the interstate rail and highway system developed, protection of this national network similarly evoked federal penal legislation against train robbery, stealing of goods moving in interstate commerce, transportation of stolen goods across state lines, and even transportation of women ‘‘for immoral purposes.’’ Thus arose a dual jurisdiction whereby a great many local crimes could be prosecuted either by the state or by the national government if some federal ‘‘peg’’ could be proved.
In the case of mail fraud, the federal peg was use of the mails to carry out the scheme to defraud. This was more than a technicality. The mails were extensively employed to conduct fraudulent public promotions extending far beyond the bounds of the state or foreign country where the enterprise was operated. The federal government, by making the subsidized facilities of the postal service available to swindlers, would be perceived as aiding in the exploitation of the victims. State officials where the victims resided would be hampered in investigating operations thousands of miles away, and there would be overlapping and wasteful enforcement effort when numerous state investigations were initiated. Within the postal service, enforcement officers called postal inspectors were employed to determine when the mails were being used for noxious purposes (including not only fraud but extortion, dissemination of pornography, and the like) and to assemble evidence for prosecuting those who thus exploited the federal facilities. Unfortunately, once this enforcement apparatus was created, it followed the tradition of bureaucratic expansionism and involved itself in a great deal of petty local misconduct where, for example, the culprit used the mail, however peripherally, in writing to the victim in the same city or state.
Continuing Limits on Criminality of Fraud
Notwithstanding the breadth of the mail fraud statute and some comparable state laws, much chicanery remains beyond the scope of theft law. If businessmen combine to raise prices above the competitive level that would prevail but for their conspiracy, their illegal behavior must be explicitly penalized by antitrust laws. If a merchant takes advantage of the buyer’s ignorance or need for credit to overcharge him outrageously, no crime is committed. If the officers of a corporation vote themselves unconscionable salaries and bonuses, only civil suits present a slim possibility of recovery. Immune from theft law also are manufacturers who cut costs and increase profit by substituting inferior ingredients, and manufacturers who purposely build rapid obsolescence into their automobiles so as to sell more high-profit replacement parts. The taxpayer who defrauds the government of taxes by understating his income and the importer who evades customs duties by smuggling face prosecution under specific statutes, but not for theft. The advertisers who secure our patronage by manipulating our emotions rather than by misrepresentation—for example, by baselessly associating health, virility, sexual attraction, or worldly success with their cereals, skin creams, and cigarettes—are not guilty of theft if, without representations, they merely suggest the association by depicting virile men and lovely women availing themselves of these products.
Perhaps the most interesting noncriminal frauds are found in the fields of religion, politics, and love. Here the problem is not so much that the theft statutes do not apply as that proof is exceedingly difficult and prosecution would run head-on into widespread complacency about prevarication on these subjects, as if deception were, to some extent, part of the game.
As to religion, even the Constitution comes into play to provide a special preserve for fraud, as shown in the famous case of United States v. Ballard, 322 U.S. 78 (1944). The Ballards, husband and wife, were indicted under the Mail Fraud Act for mulcting the members of a religious sect organized and presided over by themselves. Among the knowingly false representations charged to have been made were assertions that the defendants had communications with various saints and that they had the power of healing, which generally manifested itself in transactions transferring wealth to the Ballards. The defense objected to any attempt to prove that the religious assertions were false, arguing that this would amount to a heresy trial contrary to the guaranty of freedom of religion in the First Amendment. The trial court accepted this argument and limited proof to a showing that the Ballards did not believe their assertions; that is, the fact knowingly misrepresented was their own state of mind, not the actuality of communication with the saints. On this theory they were convicted by the jury, and that theory was ultimately upheld by the United States Supreme Court.
However, in a notable and witty dissent, Justice Robert Jackson argued that the First Amendment difficulty was not solved by limiting the proof to the defendants’ subjective disbelief of their own statements, since the normal way of demonstrating such disbelief would be to show that the statements were incredible and would not be believed by a reasonable person. Justice Jackson could not see how a governmental effort to establish the incredibility of a religious assertion could be squared with the First Amendment. But going beyond that, he inclined to the view that it was too dangerous to permit criminal prosecution of a preacher based on his subjective reservations as to this or that tenet of his faith. Moreover, Justice Jackson viewed pecuniary support of church and faith as quite distinct from commerce. The contributor is not seeking his money’s worth but rather expresses his faith through giving.
In politics, there is a significant paucity of prosecutions instigated by disappointed contributors against candidates who upon election promptly abandon elements of the party platform, giving rise to an inference that the platform was never meant to be carried out. Political contributions, too, must be treated as expressions of faith rather than purchases of commitments. The grounds of politics are too shifting to subject a change of position to potential prosecution. The inhibitions on electioneering generated by potential prosecutions under such circumstances would raise free-speech issues. Political bias, real or suspected, in a trial where the issue was the good faith of a ‘‘promising’’ candidate would evoke public cynicism, and suggests the imprudence of treating false political promises as a crime.
As for love, whether or not ‘‘all’s fair in love and war,’’ who is to tell whether the fateful declaration ‘‘I love you’’ was true of false? Does the declaration mean ‘‘I lust for you’’ or ‘‘I would die for you’’? Does it mean ‘‘tonight’’ or ‘‘forever’’? To what extent was the victim deceived? To what extent are passionate declarations conventional expressions shaped by literature, movies, or television broadcasts, rather than representations or promises? Would the quality of courtship, sexual relations, or communal life be enhanced by authorizing criminal prosecution in this area, prosecutions that would be as exceptional as were prosecutions for adultery when that was pervasively penalized?
Seduction, that is, obtaining sexual intercourse by deception, seems a fairly straightforward fraudulent obtaining of services, and was once widely punishable not as theft but as part of the regulation of sexual behavior. It no longer is. Notably, even civil suits for ‘‘breach of promise’’ or seduction have been widely discountenanced by law as facilitating blackmail. It remains paradoxical that a villain who obtains one dollar from a trusting woman by falsely representing his credentials commits the serious offense of theft, whereas securing her sexual compliance by the same deception remains unpunishable.
Would-be participants in the ‘‘religious racket,’’ attracted by the thought that constitutional protection of religious freedom somewhat obstructs prosecution for fraudulent religious pretenses, should bear in mind that there is no constitutional barrier to prosecution for misrepresenting the purpose to which religious contributions are to be applied. Thus, pretending that the contribution is sought to build a church when in fact the swindler intends to pocket the funds is punishable fraud. Similarly, embezzling funds over which the swindler was given control for a specified religious use is punishable theft.
Receiving Stolen Goods
The law generally penalizes an accessory to a crime only if he conspired or aided in its commission or if, after the commission, he harbors or conceals the offender, that is, obstructs law enforcement. The objective encouragement that a ‘‘fence,’’ of professional receiver, gives to theft does not amount to conspiring or aiding in the theft, although a receiver can easily cross the line and become a conspirator, for example, by entering into a continuing relationship with the thief, promising to buy regularly, or suggesting what would be best stolen and where. Merely buying the loot does not amount to harboring the thief. These limits of accessorial liability gave rise to special legislation penalizing those who buy stolen goods or otherwise aid the thief in disposing of them.
In principle, the receiving, like other theft offenses, should be confined to situations where the offender knows he is dealing with property that does not belong to the person bringing it to him. The difficulty of proving such knowledge led to broadening the statutes to cover recklessness or negligence with respect to true ownership. Sometimes the statutes created a presumption of knowledge where the receiver bought at far less than the market value of the goods, although such a presumption appears to contradict the constitutional requirement that conviction of infamous crime be based of proof beyond a reasonable doubt. An alternative approach to the problem of the professional receiver is to license and regulate pawnshops, junk dealers, and secondhand stores. The regulations may require the dealer to keep record of the identity of the sellers, to report certain purchases to the police, to submit to police inspections, and the like. Violations lead to suspension or revocation of license and of the right to do business, or to misdemeanor penalties for breach of regulations.
Grading of Theft Offenses
The function of a penal code is not only to specify what is punishable but also to set legislative limits on the discretion of judges in imposing sentences and to express a legislative judgment on the relative heinousness of different offenses. The question then is, What do legislatures provide, and what should they provide, in the way of maximum sentences for various forms of theft? One might initially expect that if ‘‘theft’’ is a rational category of behavior, the legislature would content itself with providing a maximum sentence of, say, ten years’ imprisonment for theft of the greatest scale under the most aggravating circumstances. Within the ten-year legislative maximum, the sentencing judge would have discretion to impose individual sentences that reflect the infinite variety of circumstances and offenders. Actual duration of imprisonment under an indeterminate sentence imposed by the judge would be determined at the discretion of a parole board, which may judge that the prisoner has been sufficiently reoriented by his prison experience to be safely returned to the community.
Sentence limits expressed in categories as gross as larceny or theft are unacceptable. Already in the eighteenth century, the extreme penalty authorized for larceny led to statutes barring capital punishment where only petty values were involved. By the twentieth century, the grading of theft offenses by value had become more complex. There would be not only ‘‘grand’’ and ‘‘petty’’ larceny, but ladders of value with three or more rungs, for example, at $100, $500, $5,000, and $100,000. Petty-value grading might be denied in the case of particular classes of property, the misappropriation of which was especially to be discouraged. Examples are guns, drugs, public records, vehicles, mail, and keys. Similarly, legislative downgrading based on low value might be denied because of aggravating circumstances, such as theft of public property by a civil servant, theft by means of certain threats, or theft of property by one to whom it was entrusted in a fiduciary capacity. Of special interest is the development of statutes dealing uniquely with shoplifting, or stealing merchandise from stores, carrying very low maximum sentences. It seems strange that merchants would seek legislation reducing the penalties for stealing their goods. They recognized, however, that lower penalties, which can be imposed in less formal proceedings before magistrates, would be a more effective deterrent than cumbersome prosecution for conventional larceny.
Apart from different maxima corresponding to amounts stolen, there were differences depending on the manner in which the theft was effectuated. The historic evolution of theft legislation had the consequence that every time a legislature added a new category of theft, such as embezzlement or false pretense, it made a contemporary judgment of the appropriate maximum for that ‘‘new’’ offense without aligning that maximum with older, more rigorous sanctions applicable to larceny. After the consolidation of theft offenses, discussed below, these differences tended to disappear, leaving only traces in the value-grading where certain betrayals of trust, such as embezzlement, may carry higher legislative maxima than a corresponding larceny.
Consolidation of Theft Offenses
Penalizing thievish rascality by means of a variety of distinguishable offenses entailed a number of technical legal problems that led twentieth-century legislators to attempt to consolidate the historic array of theft offenses into a single comprehensive offense called theft or stealing. One of these problems was legislative, having to do with the propriety of prescribing different penalties for different forms of theft. More pressing was the prosecutor’s problem of choosing the right offense to charge. From information provided by the police, he might reasonably conclude that a case was larceny by trick, only to have that charge defeated by evidence that the culprit secured not merely possession but title; this would make the offense an obtaining by false pretenses rather than a larceny. If the prosecutor were foresighted enough, he might have charged both offenses, leaving it to the jury to select the proper one. But the vagaries of juries and the subtlety of the distinction might result in conviction on the wrong count and acquittal on the other. Upon appeal, the conviction on the wrong count would be reversed, and the reprosecution on the right count would be barred by constitutional prohibition against retrying an accused on a charge upon which he has once been acquitted. In one case, a woman obtained money from a prominent actor upon her representation that she had had intercourse with him and had borne his child. The actor denied having had intercourse with her. She was convicted of obtaining by false pretense, but the conviction was set aside on appeal on the ground that the actor, knowing that he had not had relations with her, could not have been deceived; the offense was extortion by threat rather than obtaining by deception (Norton v. United States, 92 F. 2d 753 (9th Cir. 1937)).
The frustration felt by prosecutors, victims, the press, and the public at the spectacle of swindlers thus eluding punishment is understandable. The consolidation statutes were not, however, an unqualified success. The accused was still entitled, as a matter of fair procedure, to be given notice in advance of the trial regarding particulars of the charge. The particulars given would tend to show one or another of the traditional categories of theft, and the prosecutor would be required to prove the case so outlined and no other, lest the defense be unfairly ‘‘surprised.’’
What was really needed here to prevent frustration of the law was a more flexible and realistic view of ‘‘harmless surprise.’’ The legislators might even have retained the older, multiplecategory theft if they also had enacted a rule that conviction for any category of theft should be valid if the evidence proved guilt under any other category in the absence of demonstrated prejudicial surprise. It would be a rare case in which a defendant and his lawyer would not be fully aware of the nature of the transaction charged as criminal, and the choice of the proper penal label ought not to matter. The argument is tempting, but it encounters formidable objections. Sometimes it does matter, for example, if the legislature has prescribed different penalties. Where trial by jury is a fundamental right, it matters that the jury, not a judge, determine what offense has been committed. On the other hand, as a practical matter courts do indeed implement a casual version of the doctrine of ‘‘harmless surprise.’’ They will not throw out a conviction because of variances between the indictment and the prosecutor’s case unless the variance is ‘‘material,’’ and the defendant suffered ‘‘prejudice’’ as a result of the surprise. (See, for example, Thompson v. Nagle, 188 F.3d 1442 (11th Cir. 1997); United States v. Mills, 366 F.2d 512 (6th Cir. 1966)).
Under the consolidation statutes the old distinctions still retain importance because the outer boundaries of the consolidated theft offense are an amalgamation of the boundaries of the constituent offenses. The line between what is criminal and what is noncriminal continues to derive from the older law. Thus, a misrepresentation that is noncriminal under classic falsepretense law might suffice for larceny-by-trick. It becomes crucial, then, to know whether the case involves a transfer of title (false pretense) or a tricky taking and carrying away from the possession of another (larceny). Moreover a consolidation statute is likely to need and to incorporate sentencing distinctions that parallel the categories of the older theft law. For example, leniency for petty larcenies may be inappropriate for small embezzlements by fiduciaries or public officials.
The consolidation reform may have assumed an importance for prosecutors, judges, and academic lawyers that is disproportionate to its practical significance. However striking and provocative the cases of individual swindlers who ‘‘get off’’ may be, it must be remembered that these make up the tiniest fraction of theft prosecutions, which in turn represent a small fraction of thefts committed. The security of our belongings is not measurably impaired by these rare, though spectacular, acquittals, although politicians and press may play up these incidents in such a way that we all feel less secure. Important increments in property security can come only from more effective policing, improved technology, greater economic justice, and a lessening of the alienation of segments of the population from the general community and its standards of behavior.
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