
    IN THE MATTER OF THE JUANITA SUGAR & COFFEE PLANTING COMPANY, Bankrupt.
    Mayaguez,
    Bankruptcy,
    No. 15.
    Instructions to Referee in Bankruptcy.
    Bankruptcy — Review of Referee’s Order.
    Bankruptcy order No. 27 provides that a review of the referee’s action can he had upon petition of the creditor whose claim is disallowed. But the court can, under bankruptcy rule No. 37, mold the procedure in special cases, and should do so \Vhere the referee himself asks the instruction of the court about a public matter, such as a franchise and a claim for taxes.
    Memorandum filed April 14, 1913.
    
      Mr. B. J. Horton for the bankrupt.
   Hamilton, Judge:

In this case a- question as to the allowance of a certain claim has been referred- to me by the referee.

I am perfectly aware that there has been a decision in Ee Smith, and that bankruptcy order No. 21 would indicate that this could only come up by petition of the creditor whose claim had been turned down. But for three reasons I have directed the clerk to file this, and will hear it. In the first place, a referee is in some sense an officer of the court, and when he certifies a matter up, it would he a very flagrant case when the court ought not to take some action in the way of instructing him as he asks. In the second place, bankruptcy rule Ho. 37 rather indicates that the court has power to modify the procedure m special cases, and I think this is one. In the third place, this is a matter relating to a franchise and a claim for taxes, and is therefore a public matter, and, while of course not passing in the slightest on the merits of this particular petition, I think it should have special consideration. Taxes and such public matters must be considered.

It has come to me, whether irregularly or not, and for that reason I have directed the clerk to file this, and will hear it. Of course I don’t pass upon the merits of it. There may be nothing in the claim.

THE CHARGE OF THE COURT TO THE GRAFT) JURY DELIVERED AT SAY JUAH, PORTO RICO, APRIL 23, 1913.

Grand Jury — Origin.
1. The grand jury represents the police power of the community, and goes back in essence, although not in its present form, to the beginnings of civilization.
Grand Jury — Arm of the Court.
2. The grand jury is the arm of the court in all matters relating to crimes in the community.
Grand Jury — Felonies.
3. A grand jury can indict for felonies and for misdemeanors, but should devote their time rather to consideration of felonies.
Grand Jury — Probable Cause.
4. A grand jury should consider only the matter of probable guilt or probable cause; the petit jury tries the question of actual guilt.
Grand Jury — No Pear or Favor.
5. A grand jury must act without fear or favor. Upon it depends justice, which is another word for enforcement of law.
Grand Jury — Secrecy.
6. The proceedings of a grand jury are secret, and should not he mentioned outside, during its sessions or afterwards.
Grand Jury — Procedure.
7. The foreman swears witnesses; the district attorney aids with advice, but is not present at a vote. The grand jury may consist of sixteen men or over-, of whom twelve must unite to find a true hill.
Grand Jury — Knowledge.
8. A grand jury acts upon knowledge of its members, reports of United States commissioners, and recommendations of the district attorney, and complaints of individuals.
Grand Jury — Federal Crimes.
9. While the grand jury represents the community, its duties are confined to violations of the Federal statutes, such as those relating to the postoffice, customs, counterfeiting, quarantine laws, offenses in ports, bays, and high seas, anti-trust laws, and perjury in the Federal court.
Grand Jury — Lottery Tickets.
10. The importation of lottery tickets for sale is forbidden by § 237 of the Criminal Code of the United States; and the intent may be presumed from facts and circumstances surrounding each particular casé.

Hamilton, Judge:

It becomes tbe duty of tbe court, gentlemen of tbe grand jury, to make a charge to you upon your duties in general. There can be no greater responsibility than that of a grand’ jury. It is an institution which goes back to the beginning of society; and if we stopped to look it up and analyze it, we should find that it is one of the few absolute survivals of the greatest antiquity, of a time when nations were not known, and each community regulated its own affairs. As civilization has grown and communities Rave become united into states and great empires, it bas become necessary to subdivide government into a number of departments. Then you bave, in different countries, different forms of government. But this one feature of an individual community looking after tbe policing within its own district, its own limits, has survived in tbe shape of tbe grand jury. It is one of tbe oldest institutions, — not necessarily by that name, — but one of tbe oldest institutions in tbe world; so you not only occupy a position of great power and great usefulness, but you really represent an unbroken succession back almost to tbe beginning of civilization.

Tou are, gentlemen, tbe arm of tbe court, — in fact, there being so many of you, tbe court is almost like Briareus. You are tbe arms of tbe court. It is through you that cases are brought before tbe court, relating to crimes in this community. An example of your power, going back to ancient times, is this, — perhaps not an important one, but still an instance, — it is in your power and in your duty, if you think fit, to examine tbe jail where prisoners are confined, to see that it is in proper order, and make proper recommendations.

You are to consider only felonies. I don’t say that you could not present a misdemeanor if you saw fit, but that will take more time than is necessary, and misdemeanors can be presented by tbe district attorney upon information; so I would suggest that you do not take up tbe question of misdemeanors. Tbe distinction between a felony and a misdemeanor tbe district attorney can give you more easily. Felonies are tbe more serious offenses, punishable by more severe penalties. And particularly any question about tbe pure food law should probably be left to the district attorney, as that is a misdemeanor. You are to remember this, that you are not a petit jury. I have no doubt that you all understand the distinction, but at the same time there is no harm in mentioning it. You do not try anyone. You hear only one side of the case. I do not mean that you would not have the power to examine witnesses and get at the truth, — of course that is what we want to get at, — but at the same time the actual question of whether one is guilty or not guilty is left to the petit jury. If you find that there is probable cause to believe that a certain offense has been •committed, it is your duty to return an indictment, and leave'the question of guilt for a trial before the petit jury. So the question before you is, in any case, simply that of probable cause.

I am not yet, of course, well acquainted with the community over which I have the honor to preside in this capacity, but I do know that there is a question that comes up before any community, and that is, you must see that justice must be done without fear of anyone, whether he is influential or rich, and without favor to anyone because he is poor, or for any other reason. Justice is the one thing that binds society together. If you do not have the enforcement of law, — for that is what justice is, — you don’t have society, and you are representing the oldest, and, in some respects, the most important institution of all. I 'leave it to you and to your consciences to present any crime that you find has been committed, without fear and without favor. That is your duty.

So much in a general way as to your duties. Your proceedings ought to be secret. 2sTo one is to know what you are considering. You are not to discuss it outside while you are in session, and you are not to discuss it outside after you have concluded your work. You represent the inquisitorial side of society. It is a high duty, and it is a duty which must he discharged promptly and in secrecy, or it will fail its own object. If it is known outside what you are doing, how long do you suppose a criminal would stay around to await your action? Your proceedings, then, are to be secret.

As to your procedure, you have certain officers, onp of whom is your foreman, who has been selected for his special qualifications. He represents you in all communications with the outside and with the court, and he it is that administers the oath to the witnesses that come before you. He has that power just the same as the court has. That is specially given by § 809 of the Revised Statutes, U. S. Comp. Stat. 1901, p. 627. You have to assist you, the district attorney of the United States. He is specially qualified to do so from his knowledge of law, and from his knowledge of what has been going on in the community, and his residence among you. He is not to be with you when you take a vote upon any question, but you are at liberty to call upon him at any and all times. Your vote upon the question of an indictment is for you alone, for your conscience, and before your God. Twelve men of the sixteen or eighteen, whoever make up the grand jury, must agree to find an indictment. It is not as with a petit jury, where all must agree, but simply twelve. If twelve agree and four do not, an indictment is found. That is also under the Revised Statutes, § 1021, U. S. Comp. Stat. 1901, p. 719. Witnesses will be subpmnaed for you upon application to the district attorney, whoever you want, whoever you think proper for the discharge of your duties. When you think an offense has been committed, you find what is called an indictment, and you indorse upon it, “A true bill,” and the foreman’s name is signed, and it comes to the court. If you do not think, upon any paper that is presented to you, that you should find an indictment, you indorse it, “Hot a true bill.”

Now the question may come to your minds, how are you to get knowledge of any crimes that have been committed. There are four or five ways. In the first place, if any one of you knows of any felony that has been committed, it is your duty to bring it up; and then again, the district attorney is well posted upon what has occurred in this community, and he will no doubt bring to your attention certain ofEenses. And then the United States commissioners will no doubt return to you papers showing certain offenses, and it may be that witnesses will some before you voluntarily to give you the information. This does not mean that you are bound to do what any of these gentlemen wish done, but it does mean that the cases come before you for serious consideration. So much, then, for your procedure.

A few words as to what crimes you are to consider. Do not be misled by my suggestion that you represent the community, into thinking that you must present any crime that has been committed in this community which would be for the grand jury of the local courts, and not for the Federal grand jury. You are concerned simply with crimes against the laws of the United States. You represent the United States, and have to do with offenses against its law, the Federal law. I will give you some instances. The postoifice, you know, is one of the United States institutions, — in some respects one of the most valuable we have. We do not stop to think when we get a letter; we take it as a matter of course. If we stop to analyze it, that letter may have been handled by a hundred people in the course of its travels from its starting point to you. If that letter is to come to you as it was written, sealed and undisturbed, it is necessary that every one of these officials that handle that letter should do so in compliance with law, and not tamper with it in any way. And if anyone has violated the law in the handling of the mail, or if anyone has broken into the mail and robbed it, or taken any postoffice funds, or has committed any violation of the United States postal laws, — I cannot give you'all the details, — it is necessary to investigate the case and present an indictment.

The same would be true of the United States customs under the control of the collector of customs; but let me call your attention in passing to the fact that you have nothing to do with the internal revenue. That in the United States is a large branch of the Federal grand juries’ investigations, but not here, because it is left to the People of Porto Rico; but the customs proper come within your purview.

Counterfeiting is another, whether paper money or the coins of the United States. You can see that any crime of that sort strikes the very foundation of business. If we cannot rely upon our money, we can have no business of any kind. But in all these cases you must look at the offense against the dignity of the United States, rather than whether it is a small offense in itself. A small offense in itself may be a very serious offense. The counterfeiting of a nickel you may think would be a small thing in itself, and^yet it will be a very serious thing if we cannot rely upon the coins.

Another question is that of lottery tickets, either lotteries here, or the bringing of lottery tickets here for sale. The United States had, you recollect, one of the great investigations, one of the great fights of its history, in connection with what was called the Louisiana lottery, and others, and spared no money and spared no time to suppress that form of gambling. And if you find that any lottery tickets — of course not the Louisiana, hut from any foreign country — are brought here, it is your duty to find the proper indictment.

The district attorney will present evidence to you showing alleged violation of the laws of the United States relative to the importation of lottery tickets. The law upon this subject is found in 237 of the Criminal Code of the United States [35 Stat. at L. 1136, chap. 321, U. S. Comp. Stat. Supp. 1911, p. 1661], and provides in its material parts as follows:

“Whoever shall bring or cause to be brought into the United States or any place subject to the jurisdiction thereof, from any foreign country, for the purpose of disposing of the same, any paper, certificate or instrument purporting to be or to represent a ticket, chance, share or interest in or dependent upon the event of a lottery, gift enterprise or similar scheme offering prizes dependent in whole or in part upon lot or chance, or any advertisement of or list of the prizes drawn or awarded by means of any such lottery, gift enterprise or similar scheme,” shall be punished, etc.

I charge you that while under this statute the law requires that the importation of the lottery tickets into the United States shall be for the purpose of disposing of the same, that that purpose to dispose of the same is not required to be proved by direct or uneontroverted evidence, but may be presumed from the facts and circumstances surrounding each particular case. The intent with which a defendant commits a crime is rarely susceptible of direct proof, and can only be presumed from his acts; and I charge you that if the evidence shows that large quantities of lottery tickets have been found in the possession of any person within the island of Porto Pico, and that that person has been distributing such tickets to agents for the purpose of sale, then you might properly infer that the defendant imported said lottery tickets within the island of Porto Pico for the purpose of disposing of the same, and find indictments accordingly.

A violation of the quarantine laws comes under your purview. You recollect about a year ago, or something like that, how important the quarantine regulations became, and if there have been any offenses committed against them, you must return indictments.

Then, again, offenses in forts and bays and connected with the admiralty law, as to which the district attorney will advise you more fully, come within your province.

Any violation of the anti-trust laws also. You know the public mind is very much agitated upon that subject now. Iiow far it would apply, how far there has been any violation, I could not say, but if there has been, that comes before you.

There is another matter which is in one respect the most important of all, and that is the question of perjury in the United States court. I know nothing and I will say nothing about the procedure in the United States court, but I do know this, that if there has been any perjury, or shall be in the future any perjury, any false swearing, in cases within this room, it is an offense, of the very gravest character. The government would do ill to appoint a judge and officers upon salaries, and pay the expenses of this court, if witnesses are to be permitted to swear away life or property or rights of anyone. And, speaking for myself only, I would like to urge the grand jury that if any cases of that sort come to their knowledge, they do not hesitate to present proper indictments; because if there is any one thing that the judge of this court, whether the present judge or the past or future judges, has to do, it is to see that justice is administered, and the hands of this court are paralyzed if that should be defeated by means of perjury.

Gentlemen, in brief, in a general way those will be your duties. As to the method of procedure, I pointed that out, your officers and how you go about it; as to the crimes that come before you, I have named the most of them, and I can only ask you then to go to your room under the guidance of the marshal, and take up the duties which come before you, and perform them, as of course I know you will, honestly and also with such despatch as is possible. You are business men; you do not want to come from your business; the court is very loath to ask you to leave your business, but, at the same time, you can see that it is of the highest importance to the community that these duties be discharged. So discharge them carefully and with such despatch as you think the cases require.

You will now retire to your room in the charge of the marshal, and take up your duties.  