which are in no way charged against them in the indictment. Bluntly stated, it permitted conviction of defendants for an offense for which they were not on trial. It needs no citation of authorities to show the erroneous nature of this instruction. An accused person is entitled to be informed by the indictment or information of the nature of the crime charged. Evidence had been introduced tending to show that defendant Frank L. Bishop had misappropriated certain securities belonging to the Royal Arch Chapter of Masons, he being Grand or State Treasurer thereof, had used these securities as collateral to the Birkhauser and Bradshaw notes, and then sold the same shortly before the bank closed its doors. The government in its brief says little concerning this alleged error, but claims that the entire charge of the jury clearly told them that the jury must find the defendants guilty, if at all, solely by reason of the misapplication of the $1,000 arising out of the Russell transaction and the $3,000 arising out of the Mee and Benedict transactions.

The part of the court's charge relied upon as an answer to this claim of plaintiffs in error is as follows: "Now, these, gentlemen, are the instructions which will govern you in the decision of this case. You must bear in mind that the defendants are on trial, charged with the specific misapplication of bank funds as stated in the two counts in the indictment, and nothing else. It may have been brought out in the case that they were guilty of questionable acts in other transactions. That must not influence you, because they are not on trial here on any other charges, such as violation of trust in respect to the Masonic Association funds, or any of the other transactions, although those transactions do bear to some extent and are some evidence on the intent of the transactions charged in the two counts of the indictment; that is, they are entitled to be tried only upon the charges named in the indictment, and upon those alone, and as to whether they are guilty of those or not is the sole question before you." The court in this instruction did tell the jury that defendants were not on trial for the violation of any trust in respect to the Masonic Association funds. The court did not tell the jury, however, that defendants could not be convicted in this case

for the selling of the collateral. This instruction did not cure the error in the instruction before referred to. [5] We are satisfied that the court did not intend by the instruction complained of to give to it the effect which plaintiffs in error now claim; but we are not permitted, as said in Revis v. United States (C. C. A.) 9 F. (2d) 496, 498, "to reform the statements of the court, when made in such manner as tend to produce confusion and a mistaken idea in the minds of the jury." Certainly a jury, having been told that they could convict defendants, if they had taken the collateral belonging to the bank, or for which the bank was responsible to the true owners, and sold the same and misapplied the proceeds, would not understand from the other instruction as to violation of trust in respect to the Masonic Association funds that the question of the sale of the collateral was eliminated from the case. The erroneous instruction was clearly prejudicial, and requires a reversal of the judgments entered. Parties cannot be convicted under an indictment for acts which are not charged against them therein.

Errors are urged in regard to the admission of a large amount of evidence as to the nature, character, and derivation of the collateral of the Bradshaw and Birkhauser notes. This evidence showed that defendant Frank L. Bishop had misappropriated in January, 1925, property of the Royal Arch Chapter of Masons, of which he was treasurer, and tended to show the commission of a separate and distinct offense. The government in argument justifies the admission of this evidence on the theory that it was drawn out by counsel for D. H. Staley, one of the defendants, in cross-examination of the witness Fred. W. Boot, Jr., and hence that defendants cannot complain thereof. As defendant Staley has now passed out of the case by directed verdict, this question will probably not arise in any subsequent trial of the case, and therefore it is unnecessary to consider it. We think this true, also, as to the other alleged errors presented.

For the error in the instruction hereinbefore pointed out, the judgment in this case as to each of the defendants must be reversed. It is so ordered, and the case is remanded for further proceeding.

Reversed and remanded.

ers.

on the first count and acquitted on the othOne Daniel H. Staley was also a defendant, but was acquitted by direction of the court. Defendant Frank L. Bishop was sentenced to 20 years in the penitentiary at Leavenworth, Kan., on the first four counts, and 20 years on the remaining counts, the sentences upon the last four counts to run concurrently with the first four. The defendant Will F. Bishop was sentenced to 17 years in the penitentiary, and the defendant Herman B. Gates to 9 months in the county jail. Fines were imposed of $8,000 as to Frank L. Bishop and $4,000 as to Herman B. Gates.

[1] Prior to the commencement, but on the day the case was reached for trial, defendants filed an affidavit under section 21 of the Judicial Code (Comp. St. § 988), setting forth that the judge before whom the action was to be tried had a personal bias or prejudice against them. The court overruled the application for another judge to try the case, and this is assigned as error. The affidavit of disqualification under the statute was not filed until the morning of the day the case was reached for trial, viz. March 23, 1926, which was after the date the case was set for trial. Immediately after the court's ruling thereon defendants filed a motion for continuance. A large number of witnesses had been subpoenaed by the government and were present for the trial. The reasons set forth in the affidavit as the basis of the complaint as to prejudice were known to the defendants for a long time prior to the date set for trial, except one, which came to their knowledge on the 19th day of March, 1926. The statute provides for filing the affidavit as to prejudice 10 days prior to the beginning of the term. This could not be done in this case, as the case was set for trial at the same term at which the indictment was returned. Three days before the trial, to wit, March 19th, the matter which finally determined counsel to file the affidavit came to their attention. The case was reached for trial March 23d.

It is the intent of the statute that the affidavit must be filed in time to protect the government from useless costs, and protect the court in the disarrangement of its calendar, and prevent useless delay of trials, and parties filing such affidavits should be held to strict diligence in presenting the claims of disqualification. There is no reason why this affidavit could not have been filed previous to the morning of trial, and at a time when the facts upon which it was to be based were fully known to defendants' counsel. Of course, if the facts were not known until

the day of trial, it would then be in time; but where it clearly appears that practically all of them were known long prior thereto, and within ample time to have filed the affidavit before the day of trial, a party, by waiting until the day of the trial, evidences that the purpose of filing the same is delay. The spirit of the statute is thereby violated, and parties should not be permitted to reap therefrom the advantage of delay in trial. A new means of securing continuances would result from a holding that such affidavits of prejudice, where the facts are known long before, may be held until the last moment before trial and then filed.

This court has had occasion quite recently to consider this statute in two cases, viz. Heber Nations v. United States of America, 14 F.(2d) 507, and Lewis v. United States (C. C. A.) 14 F. (2d) 369. In the former case the question of the affidavit being filed in proper time did not arise. It was not filed 10 days before the beginning of the term of court, but good cause was shown for the failure so to do. The court there says: "Delay of the trial was not involved, for the trial was postponed by the court of its own motion for more than 30 days after the filing of the affidavit." In the case of Lewis v. United States the question of whether the affidavit was filed in time was not involved.

We think the expression of the court in Chafin v. United States (4th Circuit) 5 F. (2d) 592, 595, clearly states the reasonable construction of the statute: "The fair and reasonable construction of the statute is that, when the indictment is found 10 days or more before the term begins at which the case is to be called for trial, the affidavit must be filed 10 days before the beginning of the term, or good cause shown for the delay; when the indictment is found less than 10 days before such term begins, the affidavit must be filed as soon as practicable before the term begins, or good cause shown for the delay; when the indictment is found after the term has begun, the affidavit must be filed as soon as the disqualifying facts are known, or good cause shown for delay." Every case is governed to a large extent by the particular facts thereof. A defendant should not be compelled to try his case before a judge who has expressed prejudice against him. On the other hand, every consideration of fair dealing with the court requires that parties complaining of the prejudice must not make the statute a mere instrumentality for delay. That was not the purpose of its enactment. We are satisfied that under the facts of this record defendants waived the right of pro

[2] The indictment was based upon section 5209, Rev. Stat., which covers the willful misapplication of the funds of a bank which is a member of the Federal Reserve system with intent to injure or defraud such bank. Under this section two elements must combine to constitute the crimes charged in the indictment: (1) A misapplication of the funds of the bank; (2) a willful and felonious intent to, by such misapplication, defraud the bank. It is defendants' theory that the taxes paid, which are complained of in the first count, and the checks drawn by the Investment Company to the insurance companies and paid by the Globe Bank, of which defendants were officers, complained of in counts 2 to 8, inclusive, were in fact obligations that the bank was liable for; that consequently the payment of these various obligations could not constitute misapplication of funds; and that there could be no wrongful intent in so doing, and therefore that no crime was committed thereby. The defendants asked certain instructions on this theory of the case. They were not given. Defendants, of course, had the right to have their theory of defense fully presented. A failure so to do would constitute error. We do not, however, enter into this phase of the case, as, from a careful study of this record and a thoughtful consideration of every phase of the testimony, we feel compelled to face the question as to whether or not the court erred in not sustaining the motions made by all of the defendants at the close of the evidence to instruct a verdict of "not guilty." This requires a complete review of the testimony.

[3] In 1910 the Home Savings & Trust Company of Denver was organized, largely through the instrumentality of defendant Frank L. Bishop. Prior to that time said Frank L. Bishop had been in the insurance and loan business. After the organization of the Home Savings & Trust Company, this insurance and loan business was carried on as a branch of the bank's business, known as its "Insurance Department," handling the insurance business and real estate loans for clients. In 1923 the Home Savings & Trust Company merged with the Merchants' Bank of Denver and became the Home Savings & Merchants' Bank (hereafter designated the Home Bank). The insurance department continued as a branch of the bank. In 1924 this insurance department of the bank was incorporated under the name of the Home Insurance & Investment Company. This new company carried on the insurance busi

same manner as it had been carried on before its organization. It paid rent to the bank, apparently as a matter of bookkeeping, as it had been paid before, when the insurance business was concededly a mere branch of the bank.

The witness Mrs. Minty, who had been connected with the various insurance depart ments of the bank prior to the incorporation of the Investment Company and also thereafter, testified that the insurance department paid taxes really chargeable to the bank and that there was a substantial credit on the books of the insurance department as against the Home Bank for taxes paid, and that in July, 1925, the Investment Company had a credit against the bank of from $20,000 to $30,000 for items they had paid which were really chargeable to the bank. The entire issue of capital stock of the Home Insurance & Investment Company, with the exception possibly of qualifying shares for some officers, was issued to the Home Bank in payment for the real estate and insurance department of the bank. The new company occupied the quarters on the same floor as the Home Bank and was under the supervision and management of the officers of that bank. Its account was carried upon the books of the bank under the title "Insurance Department," and this insurance department was handled as a branch of the bank. July 6, 1925, the Globe National Bank of Denver merged with, or made arrangements for taking over the assets and assuming the liabili ties of, the Home Bank. A written contract was entered into between the Globe National Bank and the Home Bank. Extracts therefrom, material here, are as follows:

"This agreement, made and entered into by and between Home Savings & Merchants' Bank, a banking corporation, hereinafter referred to as 'Home Bank' and the Globe National Bank, a banking corporation, hereinafter referred to as 'Globe Bank,' witnesseth:

"Whereas, in the opinion of Colorado state bank commissioner, the capital, surplus, and assets of the Home Savings & Merchants' Bank have been badly depleted, so that said Home Bank cannot with safety and within the provisions of the law continue in the banking business; and

"Whereas, overtures were made to the Globe National Bank to assume and agree to pay its outstanding obligations; and

"Whereas, as a condition precedent thereto, the Globe Bank required that cash, or its equivalent, in the sum of one hundred eightysix thousand dollars ($186,000.00) be first provided or contributed by the directors and

of said Home Bank as a part replenishment of the depleted assets of said Home Bank; and

"Whereas, certain directors and stockholders of Home Bank have complied with said condition and have advanced and contributed for the account of Home Bank the said sum of $186,000:

"Now, therefore, in consideration of ten dollars ($10.00) each to the other in hand paid, and other good and valuable considerations, receipt whereof is hereby acknowledged, it is mutually agreed by and between the Home Bank and the Globe Bank, as follows:

"1. Home Bank has assigned and transferred, and does by these presents assign and transfer, to Globe Bank its entire assets of every kind and character existing as of date July 4, 1925, except those certain choses in action listed and appearing on Exhibit A hereto attached, which said choses in action are retained and reserved as the property of the Home Bank.

"2. The Globe Bank accepts said assignment and delivery of the assets of said Home Bank as of date July 4, 1925, and hereby assumes and agrees to pay all outstanding obligations of every kind and character of Home Bank existing as of said date July 4,

1925."

Defendant Herman B. Gates was president of the Globe Bank. Defendant Will F. Bishop was its vice president. Defendant Frank L. Bishop was president of the Home Bank and later became vice chairman of the board of directors of the Globe Bank. At the time of the so-called merger of the two banks, the Investment Company was indebted to seven insurance companies for premiums, collected between January and July, 1925, to the extent of from $25,000 to $30,000. Amounts had also been collected for customers; taxes deducted and deposited in the bank, but the same had not been checked out. The account of the Investment Company was apparently overdrawn at the time of the merger of the two banks, although Mrs. Minty, a government witness, testifies that such conclusion does not take into consideration a credit of $20,000 to $30,000 that the Investment Company was entitled to against the bank. The real situation as to this is not clear in the record.

bank; likewise a receivership for the Investment Company. The attorney for the Globe Bank, Mr. Wright, was called in, and the matter was laid before him as to whether or not the Globe Bank was liable for these premiums, which the Investment Company had collected, and whether they should be paid by the bank; likewise the taxes. He examined the contract, which provided that the outstanding obligations of the Home Bank should be paid, and also provided that the entire capital stock of the Investment Company should be held by the Globe Bank until the indebtedness of such company in the sum of $45,000 should have been paid. Mr. Wright after an examination of the contract and consideration of the various phases of the situation, as counsel for the bank, advised defendant Gates that the Globe National Bank was liable for these insurance premi

ums.

Apparently the checks to the insurance companies to pay them had been drawn before that time, but had not been delivered. After the advice from Mr. Wright, the checks were delivered to the various insurance companies and were paid by the Globe Bank; said checks being the basis of all counts of the indictment, except the first. A national bank examiner, one George E. Armstrong, was fully conversant with all of the facts relating to the merger of the Home and the Globe National Banks, and approved the same. He made an examination of the Home Bank and the Investment Company and found them both in bad financial condition. Defendants Will F. Bishop and Herman B. Gates testified that at the time of the merger of the two banks they knew nothing of the unremitted insurance premiums and taxes. In order to secure the Globe National Bank for the moneys paid out on these checks, and upon advice of the bank's attorney, Mr. Wright, certain notes and securities of the Home Bank, not included in the assets turned over to the Globe National Bank, were retained as collateral, to be held until the indebtedness of the Investment Company to the bank had been paid. The Home Bank was so advised by a letter written by the bank's attorney, Mr. Wright, and signed by Mr. Gates. This letter was as follows:

"August 27, 1925.