Maryland Larceny Trust Embezzlement Criminal Corporate Funds Lawyers Attorneys

E. STEPHEN FARLOW v. STATE OF MARYLAND

Court of Special Appeals of Maryland

May 27, 1970, Decided

The corporation rented space to manufacturers for the storage of goods. The corporation was liable to the manufacturers for stored goods that were damaged. If the corporation had excess goods in storage, it was permitted to sell the goods and retain the proceeds. E. Stephen Farlow, defendant, was employed as a general manager of the corporation.

He was authorized to sell the damaged and excess goods. Without the corporation's knowledge, defendant retained a percentage of the proceeds of such sales. When Farlow became General Manager, however, he engaged a George W. Krauss, an independent broker, to dispose of such goods. Defendant unlawfully appropriated monies belonging to John D. Schapiro and others, trading as Crown Industrial Park and Warehouse (Crown). The state charged defendant with larceny, larceny after trust, and embezzlement. A jury returned a verdict finding defendant guilty of larceny of corporate funds, but not guilty of larceny after trust and embezzlement. The trial court convicted for larceny of corporate funds..

Whether the trial court erred in convicting the defendant for larceny of corporate funds?

Although Farlow may have beenguilty of the larceny of the goods, (for which he was not charged), and the larceny after trust of the monies, (for which he was acquitted), we do not feel that the evidence was sufficient in law to sustain the conviction of larceny of the monies. This is so because there was simply no trespassory taking of the monies. If it be considered that Krauss was in lawful possession of the monies as the proceeds of a sale of goods he could legally make, it is clear that he freely gave possession of the monies to Farlow and that Farlow did not obtain possession by a trespass, actual or constructive. If it be considered that Farlow had no authority to have the goods sold because they were not damaged goods or overage, and that the sale of them was to all intent and purpose by Farlow acting through Krauss, then the possession of the proceeds of the sale by Krauss was possession by Farlow and there could be no trespassory taking of monies in his own possession even though that possession was constructive. In short, Farlow may have stolen the goods and violated a trust as to the money but in no event was his conversion of the money to his own use common law larceny.

This Court reversed defendant's conviction for larceny of the corporation's funds.

Disclaimer:

These summaries are provided by the SRIS Law Group. They represent the firm's unofficial views of the Justices' opinions. The original opinions should be consulted for their authoritative content

Maryland Larceny Trust Embezzlement Criminal Corporate Funds Lawyers Attorneys

By: Atchuthan Sriskandarajah

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