author: SWYGERT, Chief Judge.

text:
    UNITED STATES of America, Respondent-Appellee, v. Douglas Raymond DORSZYNSKI, Petitioner-Appellant.
    No. 72-1434.
    United States Court of Appeals, Seventh. Circuit.
    Argued Jan. 16, 1973.
    Decided July 20, 1973.
    Certiorari Granted Dec. 10, 1973.
    See 94 S.Ct. 792.
    Robert H. Friebert, Milwaukee, Wis., for petitioner-appellant.
    David J. Cannon, U. S. Atty., Joseph P. Stadtmueller, Asst. U. S. Atty., Milwaukee, Wis., for respondent-appellee.
    Before SWYGERT, Chief Judge, DUFFY, Senior Circuit Judge, and SPRECHER, Circuit Judge.
   SWYGERT, Chief Judge.

Petitioner-appellant, Douglas Raymond Dorszynski, appeals from orders of the district court revoking his probation and denying his motions for release from custody pursuant to 28 U.S.C. § 2255, to withdraw his plea of guilty, or alternatively for reduction of sentence.

The petitioner pleaded guilty on February 14, 1972 to unlawful possession of 1000 tablets of lysergic acid diethyla-mide (LSD) in violation of 21 U.S.C. § 844(a) and 18 U.S.C. § 2. He was sentenced to the custody of the Attorney General for a period of one year, 90 days of which were to be served in a jail-type institution. The execution of the remainder of the commitment was stayed and the petitioner was placed on probation for a period of two years following his jail sentence.

While serving his sentence, the petitioner filed a series of motions: (1) for release from custody pursuant to 28 U. S.C. § 2255, asserting that Fed.R.Crim. P. 11 was not observed because the petitioner was not advised that he was waiving his privilege against self-incrimination, that he was also not advised that he was subjecting himself to incarceration for a period of six years by entering a plea of guilty pursuant to the Federal Youth Corrections Act, 18 U.S.C. §§ 5005-5026, and that the court made no finding that the defendant would not derive benefit from treatment pursuant to 18 U.S.C. § 5010(b) or (c); (2) to withdraw his plea of guilty pursuant to Fed.R.Crim.P. 32(d), asserting that his plea was coerced and was the product of promises and inducements made to him by Acting Special Agent William W. Raebel of the Dangerous Drugs and Narcotics Division to the effect that if he cooperated with the federal authorities and entered a plea of guilty, he would receive a sentence of probation pursuant to the provisions of the Federal Youth Corrections Act; and (3) to reduce his sentence pursuant to Fed.R. Crim.P. 35. At the time of the hearing on the motions the petitioner had finished his jail sentence and was on probation.

Both Agent Raebel and the petitioner were witnesses at the hearing on the motions. The petitioner testified that Raebel had told him that he, Raebel, would ask the judge for probation of the petitioner under the Federal Youth Corrections Act. Raebel denied this. The petitioner further testified that his testimony about Raebel’s promise was not inconsistent with his sworn answers in response to the trial judge’s questions at the time of the plea of guilty. At that time, he had answered that there were no promises, threats, or pressures to make him plead guilty and that he did not think arrangements had been made with the court as to what the penalty would be.

The trial judge indicated that he believed that the petitioner had testified falsely. He denied the motions and then requested counsel to show cause why the probation should not be terminated for lying under oath. After defense counsel argued against this action, the judge terminated the petitioner’s probation and committed him to custody. This court ordered the release of the petitioner on bail pending appeal.

I

The petitioner’s first contention is that the trial judge did not observe Rule 11 of the Federal Rules of Criminal Procedure by not expressly advising the petitioner that by entering a plea of guilty he was waiving his fifth amendment right not to be compelled to testify against himself. According to the petitioner, McCarthy v. United States, 394 U.S. 459, 89 S.Ct. 1166, 22 L.Ed.2d 418 (1969), and Boykin v. Alabama, 395 U.S. 238, 89 S.Ct. 1709, 23 L.Ed.2d 274 (1969), require that a defendant be advised that, by pleading guilty, he is waiving his right against self-incrimination.

In the case before us the trial judge advised the petitioner that by pleading guilty he was waiving his rights to trial by jury and to confront the witnesses against him. The judge further advised the petitioner that he was presumed to be innocent and that the Government had the burden' to prove that he was guilty beyond a reasonable doubt. The petitioner stated that he desired to waive those rights and the presumption. The judge also asked the petitioner if he had ample time to talk to his attorney and to understand what was happening. The petitioner said yes. The petitioner, a second year college student at the time of the plea and represented by counsel, has never alleged that he did not understand he was waiving his right against self-incrimination.

Neither McCarthy nor Rule 11 require a ritualistic question to a defendant asking if he understands that he is waiving his right against self-incrimination. The waiver is implicit. United States v. Webb, 433 F.2d 400, 403 (1st Cir. 1970).

II

The petitioner’s second contention is that it was improper to commit him, a nineteen year old, as an adult unless the trial judge had first determined on the record that the petitioner would not benefit from treatment under the Federal Youth Corrections Act.

The petitioner admits that the Youth Corrections Act was never mentioned in sentencing and that all parties assumed the petitioner was sentenced as an adult under the Criminal Code. He argues, however, that section 5010(d) of the Act requires the district judge to make a specific finding with reasons as to why the petitioner would not derive benefit from treatment pursuant to section 5010(b) or (c). The authority for this position is United States v. Waters, 141 U.S.App.D.C. 289, 437 F.2d 722, 725 (1970), which held that such a finding had to be explicitly or implicitly made.

The legislative history of the Youth Corrections Act establishes that a purpose of the Act was to make available a system for the' sentencing and treating of youths to be used in the judge’s discretion. See 1950 U.S.Code Cong. Service, p. 3983. It was designed to provide an alternative to sentencing as an adult under the Criminal Code.

The record here supports the implication that after the petitioner’s trial counsel had raised the possibility of sentencing the petitioner as a youth offender, the trial court determined that the petitioner would not derive benefit from treatment pursuant to section 5010(b) or (c). Insofar as Waters, requires that the trial judge make an explicit finding to that effect, we decline to follow it.

Ill

Lastly, the petitioner contends that the revocation of his probation violated his rights to due process of law. At the conclusion of the post-conviction eviden-tiary hearing, the trial judge announced that Dorszynski testified falsely that agent Raebel had promised prior to sentencing to bring to the judge’s attention the availability of the Youth Corrections Act. The judge followed up this announcement by saying, “And I, therefore, believe he [the petitioner] should show cause why his probation should not be terminated.” At the conclusion of comments by petitioner’s counsel, the court ordered the probation terminated.

The judge took the position that the petitioner had perjured himself in the presence of the court and that by terminating probation, he was not increasing petitioner’s punishment but only reasserting the penalty originally imposed. The judge also inferred that under the circumstances no “formal proceedings” in conformity with Fed.R. Crim.P. 32(f) were required.

It is evident from the record that the judge determined"that the petitioner was guilty of perjury, an offense punishable under 18 U.S.C. § 1621. Although the petitioner was not formally charged with that offense nor afforded a trial to determine his guilt, he was in a very practical sense convicted — in the mind of the judge — and punished by the revocation of his probation.

The only condition of the petitioner’s probation prescribed at the time of sentence that is relevant was that he should “refrain from violation of any law [federal, state, and local].” Rule 32(f) provides that probation should be revoked only after a hearing “at which the defendant shall be present and apprised of the grounds on which siich action is proposed.” It is highly questionable whether the procedure by the rule was observed even in a rudimentary sense in the situation before us. But bypassing that and assuming that the petitioner did testify falsely, such conduct did not violate any of the specified conditions of his probation. Only upon being accused of and convicted of perjury in accordance with procedural due process would the petitioner have violated the condition of probation referred to above.

We appreciate the sense of outrage that the district judge apparently experienced upon becoming convinced that the petitioner had not testified truthfully. False swearing, however, not only is a serious offense, legally and morally, but also its proof must be established, if legal consequences are to result, by procedures that fully comport with due process. Although contempt was not alluded to in the instant proceedings, its analogy is readily apparent. Ex parte Hudgings, 249 U.S. 378, 39 S.Ct. 337, 63 L.Ed. 656 (1919), was a case where a witness was summarily punished for contempt after the trial judge had determined that the witness had testified falsely. In reversing the contempt decree, Chief Justice White wrote:

It is true that there are decided cases which treat perjury, without any other element, as adequate to sustain a punishment for contempt. But the mistake is, we think, evident, since it either overlooks or misconceives the essential characteristic of the obstructive tendency underlying the contempt power, or mistakenly attributes a necessarily inherent obstructive effect to false swearing. If the conception were true, it would follow that when a court entertained the opinion that a witness was testifying untruthfully the power would result to impose a punishment for contempt with the object or purposes of exacting from the witness a character of testimony which the court would deem to be truthful; and thus it would come to pass that a potentiality of oppression and wrong would result and the freedom of the citizen when called as a witness in a court would be gravely imperiled. 249 U.S. at 383-384, 39 S. Ct. at 340.

Were probation terminable upon a judge’s summary determination in a post-conviction proceeding that the probationer had testified falsely, the chilling effect of such a practice upon the pursuit of post-conviction remedies is quite apparent.

While we do not wish by our decision to give countenance to those who would take their sworn testimony in court lightly, for the reasons we have stated, we are constrained to reverse the order revoking the defendant’s probation. The orders denying the other motions are affirmed.

Reversed in part; affirmed in part.

      . If the petitioner had been placed on probation under the Federal Youth Corrections Act, he would have been eligible to have the record of his conviction expunged pursuant to 18 U.S.C. § 5021 (b).

      . The petitioner has also made an argument in his brief that he admits was not raised in the district court: That he could only have been placed on probation under the Federal Youth Corrections Act; and since he was placed on probation, he must have been sentenced under the Federal Youth Corrections Act and not as an adult. This argument has no merit since petitioner was not placed on probation but received a “split” sentence in accordance with 18 U.S.C. § 3651.


source: Caselaw Access Project

author: DUNIWAY, Circuit Judge:

license: Public Domain

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Salvador BUGARIN-CASAS, Defendant-Appellant.
    No. 73-1559.
    United States Court of Appeals, Ninth Circuit.
    Aug. 15, 1973.
    Certiorari Denied Jan. 7, 1974.
    See 94 S.Ct. 881.
    Robert W. Ripley, Jr., Federal Public Defender (argued), San Diego, Cal., for defendant-appellant.
    Harry D. Steward, U. S. Atty. (argued), Stephen G. Nelson, William A. Bower, Asst. U. S. Attys., San Diego, Cal., for plaintiff-appellee.
    Before DUNIWAY and CHOY, Circuit Judges, and RENFREW, District Judge.

       The Honorable Charles B. Renfrew, United States District Judge for the Northern District of California, sitting by designation.

   OPINION

DUNIWAY, Circuit Judge:

At about 7:30 on the morning of December 8, 1972, appellant Bugarin-Casas was driving a Ford station wagon alone along Interstate Highway 8 in southern California. Two Border Patrol agents on roving patrol, Henderson and Gilbert, were parked on the side of the highway observing traffic. That particular stretch of Interstate 8 was known by the agents to be an area with a high incidence of transportation of “illegal” aliens. When Bugarin’s car passed by them, the agents noted that Bugarin appeared to be of Mexican descent, that he was apparently alone in the car, and that the car was “riding low” in the rear. Agent Gilbert was aware that a station wagon of that model had a compartment in the rear into which the back seats could be folded, and that aliens had been found hidden in such compartments. Their suspicions aroused, the officers stopped the car. The stop was made about twelve to fifteen miles from the Mexican border.

Agent Gilbert approached Bugarin, who remained in the ear, and asked his citizenship. Agent Henderson walked to the rear of the car. While Gilbert was questioning Bugarin, Henderson saw through the rear window that the floorboard panels covering the compartment were slightly ajar. Through a crack about an inch and a half wide he saw packages, wrapped in blue paper and covered by cellophane, underneath the panels. In his 16 years as a Border Patrol agent he had seen kilo packages of marijuana similarly wrapped “hundred of times,” and he concluded immediately that the packages contained marijuana.

Gilbert told Bugarin to open the back of the station wagon. Bugarin got out of the ear, opened the rear window of the station wagon, and then lowered the tailgate. Gilbert too saw the packages. The agents then opened the compartment and found a considerable quantity of marijuana. Bugarin was arrested.

A pre-trial motion to suppress the marijuana was denied. Bugarin was convicted of possession of a controlled substance with intent to distribute, in violation of 21 U.S.C. § 841(a). On appeal Bugarin contends only that his motion to suppress should have been granted.

We delayed submission of the case pending decision by the Supreme Court of Almeida-Sanchez v. United States, 1973, 413 U.S. 266, 93 S.Ct. 2535, 37 L.Ed.2d 596 (June 21, 1973), because the government relied primarily on our decision in that case to sustain the search (United States v. • Almeida-Sanchez, 9 Cir., 1971, 452 F.2d 459). In its decision, the Supreme Court held that border patrol agents, on roving patrol such as this one, cannot stop and search cars, pursuant to 8 U.S.C. § 1357 and 8 C.F.R. § 281.7, without probable cause or a warrant. We conclude, however, that Almeida-Sanchez does not control this case.

We have held that a stop may be made by such agents, based on a “founded suspicion,” which may be less than probable cause. United States v. Barron, 9 Cir., 1972, 472 F.2d 1215; United States v. Roberts, 9 Cir., 1972, 470 F.2d 858; United States v. Brown, 9 Cir., 1970, 436 F.2d 702; Wilson v. Porter, 9 Cir., 1966, 361 F.2d 412. If after a valid investigatory stop probable cause arises, the search may then be made. United States v. Roberts, supra, United States v. Leazar, 9 Cir., 1972, 460 F.2d 982; Duprez v. United States, 9 Cir., 1970, 435 F.2d 1276; United States v. Blackstock, 9 Cir., 1971, 451 F.2d 908. Here, without a search, agent Henderson saw packaged marijuana in plain view. At that point probable cause had arisen to justify the search, which Henderson testified he would have undertaken had Gilbert not done so himself.

The question remains whether the stop itself was valid — i. e., whether there existed the requisite “founded suspicion.” Bugarin argues that under United States v. Mallides, 9 Cir., 1973, 473 F.2d 859, the stop was invalid ab initio. In Mallides we held that the presence of six men, apparently of Mexican descent, sitting “stiffly” in a large sedan and not turning to look at a passing police car, did not itself justify stopping the car on the suspicion that the passengers were “illegal” aliens, even though the area in which the car was stopped was one with a high incidence of “illegal” alien activity. We emphasized that the mere fact that a passenger in an automobile appeared to be of Mexican descent would not indicate whether he was “an American citizen, a Mexican national with proper entry papers, or a Mexican alien without papers.” Id. at 860. The focus in Mallides was clearly on the question of the likely race or national origin of the passenger, alone, as justifying the stop.

Here more was involved. Although agent Gilbert did at one point, as Bugarin emphasizes, answer affirmatively the question, “Was [the fact that Bugarin appeared to be of Mexican descent] the primary reason you stopped him?”, both Gilbert and Henderson testified that it was a number of factors in addition to Bugarin’s Mexican appearance that led them to stop the car — the fact that he was alone, the fact that the car was riding low (particularly unusual in that there was only one visible passenger), and the fact that the agents knew that the model car Bugarin was driving was of the sort that had been used to secrete aliens in a floor compartment over the rear axle. If Bugarin had not been of apparent Mexican descent, we think that these other factors were sufficient to justify the stop. See United States v. Roberts, supra. It follows that the fact that Bugarin did appear to be of Mexican descent — even considering that this was one of the factors that led the agents to make the stop ■ — should not require a different holding in this case. Mallides, supra, certainly does not stand for the proposition that if agents have grounds for a stop, they are forbidden to make the stop because the driver appears to be of Mexican descent. It only holds that the apparent ethnic background of persons in a car is a neutral fact, justifying neither a stop nor a search.

Affirmed.

      . The fact that the agents were intending at the time they stopped the car to search it in any event — generally the sort of search held unconstitutional in Almeida-Sanchez v. United States, supra, — does not render the search, supported by independent probable cause, invalid. See Williams v. United States, 9 Cir., 1959, 273 F.2d 781, 790-795, cert, denied, 362 U.S. 951, 80 S.Ct. 862, 4 L.Ed.2d 868; Green v. United States, 10 Cir., 1967, 386 F.2d 953; Sirimarco v. United States, 10 Cir., 1963, 315 F.2d 699, cert, denied, 374 U.S. 807, 83 S.Ct. 1696, 10 L.Ed.2d 1032; see also Lowe v. United States, 9 Cir., 1969, 407 F.2d 1391.

      . Appellant’s counsel asked Agent Henderson :
      “Q. In this particular instance, did you happen to notice the defendant’s ethnic background, or where he was from, before you stopped him?
      A. He appeared to be of Mexican descent.
      Q. Was that one of the reasons he was stopped?
      A. No. Not as such, no. Just the fact that the vehicle was sitting low in the rear, with only one passenger, or one person showing in the vehicle at that time of day. It is very common as an alien smuggling operation in that particular area.
      Q. Do you stop every ear that passes your area that’s low in the rear?
      A. No.
      Q. So it’s actually a combination of factors, isn’t it, that creates the necessity for the stop, in your mind?
      A. Yes, it’s a combination of factors.”
      Appellant’s counsel also questioned Agent Gilbert:
      “Q. Now, in the past, when you’ve stopped persons driving cars on this Route 8, at that junction, and there has been a Mexican person driving, have you stopped most of these cars when the person is alone?
      * * * * *
      A. It depends on the circumstances. No, I do not stop every person I see of Mexican descent. I usually have some other reason, due to my experience, that I feel to stop them for.
      Q. So Mexican descent combined with the lowness of the automobile, or some other factor that would make this car unusual to you. Would that be correct?
      A. Yes, sir.”

      . Agent Henderson testified that about 50% of the “low-riding” cars that he stopped are driven by those appearing to be Mexican. Thus the agents might well have stopped Bugarin’s car had he not appeared to be of Mexican descent.


author: GIBBONS, Circuit Judge. VAN DUSEN, Circuit Judge

text:
    William J. TWIGGER, Petitioner, v. George P. SCHULTZ, Secretary, Department of the Treasury, and Eugene T. Rossides, Assistant Secretary, Department of the Treasury.
    No. 72-1851.
    United States Court of Appeals, Third Circuit.
    Argued May 18, 1973.
    Decided Aug. 21, 1973.

      Dina G. McIntyre, McIntyre & McIntyre, Pittsburgh, Pa., for petitioner.
    Harriett S. Shapiro, Walter H. Fleischer, U. S. Dept, of Justice, Washington, D. C., for respondents.
    Before VAN DUSEN, GIBBONS and ROSENN, Circuit Judges.
   OPINION OF THE COURT

GIBBONS, Circuit Judge.

Petitioner Twigger, the holder of a customhouse broker’s license issued under the Tariff Act of 1930, 19 U.S.C. § 1202 et seq., seeks review, pursuant to 19 U.S.C. § 1641(b), of an order of the Secretary of the Treasury suspending that license for five years. He has held the license since 1949. The Tariff Act authorizes the Secretary of the Treasury to prescribe rules and regulations governing the licensing of customhouse brokers, and regulations issued on that authority are found at 19 C.F.R. Part 111. On July 27, 1971, Twigger was served with a notice to show cause and specification of four charges:

(1) failing to promptly pay or otherwise account to clients for refunds received for them from the Government;
(2) failing to exercise due diligence in paying increased duties assessed in connection with various entries;
(3) knowingly giving false information to customs agents concerning payment of refunds to certain clients; and
(4) failing to maintain current records of accounts reflecting his financial transactions in an orderly and correct manner.

Prior to the service of the July 27, 1971 notice to show cause, Twigger had on April 16, 1971, been served with a notice of preliminary proceedings, signed by the District Director of Customs at Philadelphia, Pennsylvania, advising him that that office was considering formal proceedings looking to the revocation of his license. That notice of preliminary proceedings informed, him that 5 U.S.C. §§ 554 and 558 would be applicable if formal proceedings were necessary. The same District Director of Customs signed the July 27, 1971 notice to show cause. On November 17, 1971, the same District Director of Customs, acting as Hearing Officer for the Bureau of Customs, conducted a hearing on the charges. On March 27, 1972, the same District Director of Customs addressed to the Secretary of the Treasury Government’s Findings and Conclusions and Recommendations. He concluded that Twigger was guilty of all four charges and recommended' that his license be re-voiced. The District Director forwarded the entire record to the Secretary. Eugene T. Rossides, Assistant Secretary of the Treasury, reviewed the agency record and in effect accepted the conclusions of the District Director on the charges. He suspended Twigger’s license for five years rather than revoking it as the District Director had recommended. It is that decision which we review.

Twigger’s petition for review makes these contentions:

I. That Charges (1)(2) and (4) should have been dismissed because the Bureau of Customs did not sustain its burden of proof on these charges. See 5 U.S.C. § 556(d).
II. That Charges (1) (2) and (4) should have been dismissed because the Bureau of Customs failed to comply with -5 U.S.C. § '558(c) in that it failed to give him an opportunity to achieve compliance with all lawful requirements.
III. That the entire administrative procedure was unlawful because the hearing officer also performed investigative and prosecutorial functions. This combination of functions, Twigger contends, violates 5 U.S.C. § 554(d) and the due process clause of the fifth amendment.

Each of these contentions were made and rejected in the agency proceedings. See 19 U.S.C. § 1641(b).

The agency record establishes that Mr. Twigger’s difficulties commenced with an audit by a special agent of the Bureau of Customs, made at the behest of the District Director. The agency regulations require that the special agent submit his investigative report to the District Director and to the Commissioner of Customs. 19 C.F.R. § 111.55. The District Director reviews the report and recommends to the Commissioner of Customs, his supervisor, whether or not charges should be preferred. 19 C.F.R. § 111.56. If the Commissioner of Customs agrees that charges should be preferred, a statement of charges is prepared by the District Director, and reviewed by the Commissioner. 19 C.F.R. § 111.57. The District Director then prepares and serves a notice of preliminary proceedings, to which the broker may respond in writing or orally. 19 C.F.R. § 111.59. The District Director then makes a recommendation to the Commissioner, who decides whether to proceed with charges. 19 C.F.R. § 111.61. If the Commissioner directs him to proceed, the District Director serves the notice of hearing, 19 C.F.R. § 111.64, and presides at the hearing, 19 C.F.R. § 111.67. He thereafter certifies the entire record, with his recommended decision, to the Secretary of the Treasury, 19 C.F.R. § 111.69, who affords the parties an opportunity for additional submittals, 19 C.F.R. § 111.-70. The course outlines in the regulations was followed in, Twigger’s case.

Thus, although technically the decision to initiate formal revocation or suspension proceedings was made by the Commissioner of Customs, that decision was made as a result of an investigation initiated and reviewed by the District Director and after consideration of his recommendations. This investigating officer presided at the hearing and recommended a decision. And although technically the decision was made by an Assistant Secretary, it was made on the agency record compiled by the District Director and in the light of his recommended decision. Plainly, then, if Section 5(c) of the Administrative Procedure Act, 5 U.S.C. § 554(d) applies to customhouse broker’s license revocation proceedings, it was violated. See, e. g., Amos Treat & Co. v. S.E.C., 113 U.S. App.D.C. 100, 306 F.2d 260 (1962). The Secretary urges, however, that the outlined administrative procedure is provided for by 19 U.S.C. § 1641(b) and is exempt from the requirements of the Administrative Procedure Act. Section 7(a) of that Act, 5 U.S.C. § 556(b), provides in part:

“This subchapter does not supercede the conduct of specified classes of proceedings, in whole or in part, by or before boards or other employees specifically provided for by or designated under statute.”

This savings clause, the Secretary contends, makes § 5(e), 5 U.S.C. § 554(d), inapplicable to proceedings “provided for” by 19 U.S.C. § 1641(b).

The Secretary misinterprets the savings clause, however, as an examination of the original text of the Administrative Procedure Act will disclose. That act, as originally adopted in Pub.L. No. 404, 60 Stat. 237 (1946) is set out in 4 K. Davis, Administrative Law Treatise 397 et seq. (1958) and 1946 U.S. Code Cong. & Ad. News, p. 1195, 79th Cong. 2d Sess. 288. It is organized in twelve sections. Section 5 deals with adjudication, and Section 5(c) deals with separation of functions. The prohibition against combining investigative or prosecuting functions with adjudicating functions appears in this subsection. Section 7 deals generically with hearings, both rule making hearings to which § 4 applies and adjudicatory hearings to which § 5 applies. Section 7(a) deals with presiding officers and provides in part:

“There shall preside at the taking of evidence (1) the agency, (2) one or more members of the body which comprises the agency, or (3) one or more examiners appointed as provided in this Act; but nothing in this Act shall be deemed to supersede the conduct of specified classes of proceedings in whole or in part by or before boards or other officers specially provided for by or designated pursuant to statute.”

5 U.S.C. § 556(b) is derived from § 7(a). Plainly the savings clause is intended to authorize continuance of the use of statutory boards or presiding officers who are neither “the agency”, nor “one or more members of the agency”, nor “one or more examiners appointed as provided in the Act”. The clause cannot reasonably be construed, as the Secretary urges, as excepting entirely from the operation of the Administrative Procedure Act any statutory administrative procedure calling for a class of presiding officer other than one of the three classes specified in § 7(a). A more reasonable construction of the entire Act, which we adopt, is that there may be presiding officers other than those listed in § 7(a), but that the procedural safeguards of the Act, and specifically the separation of functions safeguard of § 5(c), apply to such presiding officers to the same extent as to those presiding officers listed in § 7(a).

This construction is entirely consistent with 19 U.S.C. § 1641(b), which provides in relevant part:

“The appropriate officer of the customs may at any time for good and sufficient reasons, serve notice in writing upon any customhouse broker so licensed to show cause why said license shall not be revoked or suspended, which notice shall be in the form of a statement specifically setting forth the ground of complaint. The appropriate officer of customs shall within ten days thereafter notify the customhouse broker in writing of a hearing to be held before him within five days upon said charges.” (emphasis added).

The italicized language is, of course, ambiguous, since the appropriate officer of the customs (not elsewhere defined) might be one of the classes of presiding officers designated in Section 7(a) of the Administrative Procedure Act. However, the italicized language only came into § 1641(b) in 1970. Pub.L. 91-271, Title III, § 301(jj), 84 Stat. 291, 1970 U.S.Code Cong. & Ad. News, p. 3188, 91st Cong. 2d Sess. 322, 342. Prior to 1970 and in 1946, when the Administrative Procedure Act was adopted, in place of “appropriate officer of the customs” appeared “collector or chief officer of the customs”. It is clear that this was a statutory designation of a presiding officer other than “the agency”, “one or more members of the agency”, or “[an examiner] appointed as provided by the Act”. Indeed, the Attorney General’s Manual on the Administrative Procedure Act, 71-72, refers to 19 U.S.C. § 1641 as an example falling within the savings clause in § 7(a). The elimination, in 1970, of this specific designation in favor of the language “appropriate officer of the customs” was intended, as the Secretary urges, to implement his power to delegate responsibility for the functions of the Customs Service. See H.Rep. No. 91-1067, 91st Cong., 2d Sess. 31; cf. H. Rep. No. 91-267, 1970 U.S.Code Cong. & Ad News, 91st Cong.2d Sess. 3188, 3218.

The Secretary urges further, however, that because he can now designate any appropriate officer of the customs as a presiding officer, he must be able to designate an investigating or prosecuting officer to preside over a hearing on a case that he investigated or initiated. No congressional intention to achieve this result can be found in the language or legislative history of the 1970 amendments to the Tariff Act. But, the Secretary urges, that result necessarily follows because prior to the 1970 amendments the “collector or chief officer of the customs” could investigate, prosecute, and adjudicate.

Herein lies a double fallacy. First, § 1641 placed on the “collector or chief officer of the customs” the duty of serving notice and of presiding. It did not, and in its present form does not, specify who shall perform the investigative and prosecutorial function. Second, while it is true that the savings clause in Section 7(a) of the Administrative Procedure Act continued the authority of the “collector or chief officer of the customs” to act as a presiding officer, § 5(c) expressly forbade him from being the investigative or prosecutorial officer at the same time, even assuming he had prior to 1946 been so designated. Section 5(c) of the Act was violated in the instant proceedings.

This case does not present the considerably narrower issue whether merely authorizing the filing of charges disqualifies an agency official from participating in adjudication. See, e. g., 2 K. Davis, Administrative Law Treatise § 13.10 at pp. 237-39 (1958), arguing that merely authorizing the filing of a complaint does not taint the adjudicatory function. Whether we would agree with Professor Davis need not here be decided, because on this record we are dealing with the more fundamental taint — one expressly prohibited by § 5(e) — of combining the functions of investigator and adjudicator. The possibility of improper taint from such dual functions is substantial in this case since the adjudicating officer reviewed the investigative reports of the special agent, made at his direction before recommending prosecution. We simply do not know what information was in those reports that does not appear in the record before us, and that did not appear in the record reviewed by the Assistant Secretary when he accepted the District Director’s recommended decision. We do know that, whatever may have been in the investigative reports, the petitioner had no opportunity to offer evidence in opposition or explanation. See In re Murchison, 349 U.S. 133, 138, 75 S.Ct. 623, 99 L.Ed. 942 (1955).

The suspicion that such taint may have occurred here is reinforced by our review of the evidence bearing upon Charges (1) (2) and (4). As we pointed out above, petitioner challenges the sufficiency of the Government’s evidence on these charges. Since we have already determined that procedural irregularities tainted the administrative proceedings, it might arguably suffice merely to remand. But the procedural defects to which we have referred in no way prejudiced the agency’s opportunity to present a prima facie case. It seems hardly appropriate that the agency’s own procedural deficiencies should afford it an opportunity to adduce additional evidence. The scope of review set forth in the statute suggests, we think, that we can without remand dispose of those counts as to which the agency failed to prove a prima facie case. 19 U.S.C. § 1641(b) provides in relevant part:

“Upon the filing of [a] petition [the Court of Appeals] shall have exclusive jurisdiction to affirm, modify, or set aside such order, in whole or in part. . . . The finding of the Secretary of the Treasury as to the facts, if supported by substantial evidence, shall be conclusive. If any party shall apply to the court for leave to adduce additional evidence, and shall show to the satisfaction of the court that such additional evidence is material and that there were reasonable grounds for failure to adduce such evidence in the proceeding before the appropriate officer of customs, the court may order such additional evidence to be taken before the appropriate officer of customs and to be adduced upon the hearing in such manner and upon such terms as to the court may seem proper.”

No party has applied for leave to adduce additional evidence, and no reasonable grounds appear for the failure, if any, to adduce available additional evidence before the District Director. It is appropriate, therefore, to rule upon petitioner’s challenges to the sufficiency of the agency’s proofs.

Count (1) charges that Twigger “failed to promptly pay or otherwise account to his clients for one or more . refunds, in violation of section 31.10(7), Customs Regulations, as amended (19 CFR 31.10 (Z), revised January 1, 1968), and for section 111.29, Customs Regulations, as amended (19 CFR 111.29, redesignated June 11, 1970).” At the hearing, Twigger admitted that he did not promptly pay over. The Government offered no evidence that he did not otherwise account. The Secretary’s brief urges that “[t]he regulation requires either payment or disclosure to the client of the amount due and its disposition, so that the client may know the disposition of the money received on his behalf.” Respondent’s Brief at 18. This seems a correct interpretation of 19 C.F.R. §§ 31.10 (1), 31.29 (now designated 19 C.F.R. § 111.29). A customhouse broker may collect refunds and remit, or may keep a mutual account with his regular customers. Twigger did not introduce any evidence that he promptly notified clients of the status of their accounts. But the proponent of the suspension order had the burden of proof. 5 U.S.C. § 556(d). There is simply no proof that Twigger failed to account to his clients, and in the absence of such proof the charge should have been dismissed.

Count (2) charges that Twigger, “as importer of record, failed to exercise due diligence in the payment of increased duties assessed in one or more . . . transactions ... in violation of sections 31.10(Z) and (p), Customs Regulations, as amended (19 CFR 31.10(1) and (p), revised January 1, 1968), and/or section 111.29, Customs Regulations, as amended (19 CFR 111.-29, redesignated June 1, 1970).” At the hearing Twigger stipulated that the increased duties referred to were not promptly paid. He contended, however, that his duty was to pay over to the Government all sums “received” from his clients, not all sums owed by them. The Government offered no evidence that any of the increased duties referred to in Count (2) had been received by Twigger. The Assistant Secretary held that the failure, to pay was a violation of 19 C.F.R. §§ 31.10(1) and (p) even though the clients had not paid Twigger. Granting that we, as a reviewing court must ordinarily grant great deference to an administrator’s interpretation of his own regulations, we think that the Assistant Secretary’s interpretation cannot here be relied upon to sustain the charge. 19 C.F.R. § 31.10(1) provides:

“Each customhouse broker shall promptly pay over to the Government when due all sums received for the payment of any duty, tax or debt or other obligation owing to the Government. . . .” (emphasis added).

19 C.F.R. § 31.10(p) provides:

“Each customhouse broker shall exercise due diligence in answering correspondence, in making financial settlements, and in preparing, or assisting in the preparation and filing of, documents relating to any matter handled by him as a customhouse broker.”

Count (2) charged specific violations of these regulations. The only evidence relied upon by the Assistant Secretary as establishing the violation was the stipulation by Twigger’s counsel that the increased duties had not been paid. Clearly counsel could not have anticipated that such a stipulation established a violation of either section. The Assistant Secretary cites no other authority for his assertion that “[a]s importer of record Respondent is responsible for payment of duties when they become due notwithstanding the timing of the payment by the broker’s client to the broker.” If there is some other regulation establishing such a customhouse broker’s responsibility, its violation was not charged in Count (2). No evidence supports the charged violation of §§ 31.-10(1) and (p), and that charge should have been dismissed.

Count (4), as amended at the hearing, charges that Twigger,

“in violation of section 31.9(a) Customs Regulations, as amended (19 CFR 31.9(a) revised January 1, 1968), and/or section 111.21, Customs Regulations, as amended (19 CFR 111.21, redesignated June 11, 1970), did not maintain correctly and in an orderly, itemized manner, and did not keep current records of account reflecting all his financial transactions as a Customhouse Broker, in the following regards:
1. No cash receipts journal, disbursements journal or general ledger was maintained by him.
2. Journals patterned after CF 3079 reflecting his transactions back to 1965 were incompletely recorded, particularly with respect to refund and supplemental duty data.
3. The only cash receipts records maintained by him . . . consist solely of daily bank deposit receipts.
4. The only disbursements records maintained by him . . . consist of check stubs.”

The regulations referred to in Count (4) do not specify what books or records must be maintained by a customhouse broker, or on what method of accounting he must conduct his business. They merely require that he maintain correctly and in an orderly itemized manner, and keep current, records of account reflecting all his financial transactions as a customhouse broker. Obviously a customhouse broker, engaged in a service business analogous to the practice of a profession, does not maintain an inventory. It seems entirely appropriate that he account for his transactions on a cash receipts and disbursements basis, as do most professional service organizations, and the regulations do not suggest otherwise. At the hearing, counsel for Twigger stipulated the factual allegations of paragraphs 1-4 of Count (4) quoted above. The Government offered no evidence that the daily bank deposit receipts did not reflect all receipts and their source. Nor did it offer any evidence that the retained check stubs did not reflect all disbursements and their purpose. On this record we must assume, therefore, that Twigger maintained complete records of original entry on his receipts and disbursements as a customhouse broker, but did not maintain secondary accounting records. A certified public accountant testified that “[u]p until this day, we have had no difficulty in searching any of the source documents that we would need.” This testimony is uncontradicted and unim-peached.

No doubt the Secretary could have required by regulation that the records of a customhouse broker shall be kept in a specified manner, including secondary accounting records as well as original entries. He did not do so. Instead, he issued a general regulation that the broker keep his records in an orderly itemized current manner, reflecting all his financial transactions as a customhouse broker. On this record we must assume that all receipts were currently recorded on the daily bank deposit receipts, that all disbursements were recorded on the check stubs, and, in view of the amendment to the charges, that the invoices currently and orderly recorded accounts receivable. The agency’s case on Count (4) depends, then, solely upon the stipulated failure to maintain a cash receipts journal other than the retained daily deposit receipts, a disbursements journal other than the retained check stubs, or a general ledger, and on the stipulation that a journal patterned after CF 3079 was incompletely recorded. The difficulty with that case is that the regulations charged to have been violated do not specify the maintenance of such records. The stipulation by counsel as to the facts alleged in paragraphs 1-4 of Count (4) cannot be construed, as the Assistant Secretary construed them, as an admission of the sufficiency of the Government’s case on Count (4). Counsel maintained throughout the hearing that the records maintained were in compliance with the regulations. On this record we agree. The charge in Count (4) should have been dismissed.

Petitioner advances his contention as to noncompliance with 5 U.S.C. § 558(c) only with respect to Counts (1) (2) and (4). Since we have disposed of those counts, there is no occasion to consider whether the agency complied with § 558(c).

The order of the Assistant Secretary-suspending petitioner’s customhouse broker’s license for five years shall be set aside. The judgment setting aside that order, insofar as it is based upon Counts (1) (2) and (4) of the charges shall be with prejudice. The judgment setting aside that order, insofar as it is based upon Count (3), is without prejudice to further proceedings before an appropriate hearing officer in compliance with this opinion on that count, and without prejudice to a reconsideration by the Secretary of the appropriate sanction in view of our ruling on Counts (1) (2) and (4) should Count (3) be proved in such a hearing.

VAN DUSEN, Circuit Judge

(dissenting) :

I concur in the majority’s holding that the order suspending petitioner’s customhouse broker’s license for five years should be set aside and dissent only from that part of the judgment in favor of petitioner on Count (4), which dismisses that count with prejudice. I believe the judgment in favor of petitioner should be without prejudice to further proceedings before an appropriate hearing officer on Counts (3) and (4). There was substantial evidence in the record from which a fact finder could have found that petitioner did not “maintain correctly and in orderly itemized manner, and keep current, records of account reflecting all his financial transactions as a customhouse broker,” as required by Customs Regulation 31.-9(a). The evidence conclusively showed that the information on the journal patterned after C.F.R. 3079 was incompletely recorded, as conceded at page 16 of the majority opinion. Further, the record contains testimony that the petitioner gave investigating customs agents inaccurate information on refunds in 1967-1968, so that this is not a case of harassing petitioner without cause (22a-26a of appellee’s Appendix).

      . Section 554 is that section of the Administrative Procedure Act governing adjudications required by statute to be determined on the record after an opportunity for an agency hearing. Section 558(c), governing suspension or revocation of licenses provides that no suspension or revocation of a license is lawful unless the agency affords notice of the facts and conduct which may warrant the action, and affords the licensee an opportunity to demonstrate or achieve compliance with all lawful requirements.

      . This section, derived from Section 5(c) of the Administrative Procedure Act, provides in part:
      “An employee or agent engaged in the performance of investigative or prosecuting functions for an agency in a case may not, in that or a factually related case, participate or advise in the decision, recommended decision, or agency review pursuant to section 557 of this title, except as witness or counsel in public proceedings.”

      . See also Wong Yang Sung v. McGrath, 839 U.S. 33, 70 S.Ct. 445, 94 L.Ed. 616 (1950) where the Court held that the Administrative Procedure Act applied to deportation proceedings. The Court noted that one of the fundamental aims of the reform movement which culminated with passage of the A.P.A. was the desire “to curtail and change the practice of embodying in one person or agency the duties of prosecutor and judge.” Id. at 41, 70 S.Ct. at 450. Consequently, the Court said that “[i]t is the plain duty of the courts ... to construe this remedial legislation to eliminate so far as its text permits, the practices it condemns.” The Government contended that the immigrant inspectors who presided at deportation hearings were “provided for by or designated pursuant to statute . . . ” and hence exempted by § 7(a) from the A.P.A. The Court stated that the Immigration Act, 39 Stat. 886, only gave the inspectors prosecutorial functions. Their adjudicatory functions were derived solely from the regulations. See id. at 45, 51-52, 70 S.Ct. 445. Consequently the Court held that the A.P.A. applied.
      Shortly thereafter, in the Supplemental Appropriations Act of 1951, Congress specially excluded deportation or exclusion hearings from the provisions of Sections 5, 7 and S of the A.P.A.

      . Our conclusion that there was a violation of the Administrative Procedure Act makes it unnecessary to decide whether the combination of investigative and adjudicative functions, where the adjudication was only a recommended decision, also violated the due process clause of the fifth amendment. But see NLRB v. Botany Worsted Mills, 133 F.2d 876, 882 (3d Cir.), cert, denied, 319 U.S. 751, 63 S.Ct. 1164, 87 L.Ed. 1705 (1943) ; 2 K. Davis, Administrative Law Treatise, § 13.02 (Supp.1965) ; Compare these with Amos Treat & Co. v. S.E.C., supra.

      . The Government withdrew a fifth allegation respecting accounts receivable records.

      . See 203a (Petitioner testified that the system of bookkeeping was adequate in 1950. “But as time went on it became more and more and more inadequate.”), 129a-130a, 158a (payments were made for simplicity of bookkeeping when there was no obligation to pay), 201a-206a.


author: BREITENSTEIN, Circuit Judge.

text:
    In the Matter of James Elvin O’BANNON et al., Bankrupts. SMILEY PROFESSIONAL ASSOCIATION, Petitioner-Appellant in Nos. 73-1172, 73-1173, and 73-1174, Respondent-Appellee in Nos. 73-1175, 73-1176, and 73-1177, v. E. Ray PHELPS, Trustee, Petitioner-Appellant in Nos. 73-1175, 73-1176, and 73-1177, Respondent-Appellee in Nos. 73-1172, 73-1173, and 73-1174.
    Nos. 73-1172 to 73-1177.
    United States Court of Appeals, Tenth Circuit.
    Submitted Aug. 14, 1973.
    Decided Sept. 17, 1973.

      Jennie Deden Behles, Albuquerque, N. M., on brief for Smiley Professional Assn.
    E. Ray Phelps, Trustee, pro se, on brief.
    Before BARNES BREITENSTEIN and BARRETT, Circuit Judges.

       Of the Ninth Circuit, sitting by designation.

   BREITENSTEIN, Circuit Judge.

These six appeals from orders entered in bankruptcy proceedings were presented on a single record and will all be disposed of in this opinion. All of the appeals involve, in one way or another, referee’s orders, sustained by the district court, with reference to compensation for the attorney who prepared the petitions for voluntary bankruptcy. If 11 U.S.C. § 650 and Rule 6 F.R.App.P. are applicable, a point which we do not decide, we treat the notices of appeal as petitions to this court for the allowance of the appeals, allow each appeal, and dispose of each on its merits. See Webster Drilling Company v. Walker, 10 Cir., 286 F.2d 114, 116-117.

James O’Bannon and his wife Linda were in financial difficulties. James was an officer of a corporation, Bueno Feeds, Inc., but the nature of that office is not disclosed. He and Linda were “principal shareholders” in the corporation but the extent of their interest is not disclosed. The record does not contain the schedules of debts of the individuals or of the corporation and we do not know what, if any, identity existed.

The O’Bannons consulted a lawyer, Smiley, and paid him from their personal funds $1,500.00. At the time the corporation had assets but the nature and amount is not disclosed in the record. Smiley filed a joint petition in voluntary bankruptcy for the O’Bannons, and a separate petition for the corporation. The identifying numbers are 15,405 for the corporation, 15,406 for James, and 15,407 for Linda. Phelps was appointed trustee for each estate. The pertinent schedule in the individual estates shows payment of a $300.00 attorney’s fee and $50.00 filing fee in each, and indicates that payment was from the respective individual. The same schedule for the corporation shows payment of a $300.00 attorney’s fee and $50.00 filing fee paid by the corporation. Actually, the corporation did not pay it.

The trustee filed in the individual estates an application to examine fees under § 60(d) of the Bankruptcy Act, 11 U.S.C. § 96(d), and to recover a fraudulent conveyance allegedly arising from the payment by the individuals of the fees for the corporation bankruptcy. Evidentiary hearings were held. The record does not explain how the corporation bankruptcy became involved in those hearings. At their conclusion, Smiley presented proposed findings and conclusions in both the individual estates and the corporation estate. The trustee filed requested findings and conclusions in the individual estates. The referee made findings and conclusions in all three estates and held (1) Smiley should pay the trustee in the individual estates $694.80 as an excessive fee charge and (2) the collection by Smiley from the O’Bannons for the filing fees in the corporation estate was not a fraudulent transfer.

The trustee filed a petition for review in the estates of the individuals and Smiley filed a similar petition asking for review in all three estates. The referee’s certificate on petition for review covered all three estates. The only action of the district court was to deny, in one order, all of the petitions for review. Smiley and the trustee then each filed a separate notice of appeal in each bankruptcy estate. No order of consolidation was requested or made in the court of appeals. However, one record was presented and the appeals were jointly briefed.

We consider first the problems relating to examination under § 60(d), 11 U. S.C. § 96(d), of the fees paid. That section authorizes examination in summary proceedings of payments made by a debtor to an attorney in contemplation of bankruptcy for services to be rendered by the attorney in connection therewith. Conrad v. Pender, 289 U.S. 472, 475, 53 S.Ct. 703, 77 L.Ed. 1327. The purpose of the statute is to restrain “opportunities to make an unreasonable disposition of property through arrangement for excessive payments for prospective legal services.” Ibid, at 477, 53 S.Ct. at 705.

Section 60(d) relates only to attorney’s fees for legal services to be rendered in contemplation of bankruptcy and not to legal services to be rendered after the petition in bankruptcy has been filed. In Re Louisiana Loan and Thrift Corporation, 5 Cir., 416 F.2d 898, cert, denied, Holahan v. Reynolds, 397 U.S. 912, 90 S.Ct. 912, 25 L.Ed.2d 93, and In Re Falk, 2 Cir., 30 F.2d 607, 608-609. The first question is the nature of the services. If the fee was paid in contemplation of bankruptcy and for services to be rendered before bankruptcy, the fee is examinable under § 60(d). Smiley urges that the fee charged, above that listed in the two individual schedules, was not examinable because it was for non-bankruptcy related services to be performed after the filing of the petitions. The evidence in this regard was conflicting. Smiley claims that the services to be rendered were with regard to certain pending litigation and feared criminal prosecutions. O’Bannon testified that the $1,500.00 payment was in contemplation of bankruptcy and that there was no agreement that Smiley represent him in other matters. The referee apparently believed O’Bannon, and found that there was no agreement that “the sum paid as attorney fees would include legal representation in any criminal or conversion cases” or at hearings on objection to discharge. The pertinent finding of the referee is supported by substantial evidence, is not clearly erroneous, and is binding on us. General Order 47 (see Bankruptcy Rule 810, effective October 1, 1973), and Potucek v. Cordelería Lourdes, 10 Cir., 310 F.2d 527, 530, cert, denied 372 U.S. 930, 83 S.Ct. 875, 9 L.Ed.2d 734. Accordingly, the fee paid by the individuals for their bankruptcies is subject to examination under § 60(d).

This brings us to the provisions of § 60(d) that the fee “shall be held valid only to the extent of a reasonable amount,” and that “the excess may be recovered by the trustee for the benefit of the estate.” On the basis of evidence relating to the services rendered and to the opinions of experts on the value of those services, the referee found that a reasonable attorney's fee for the individual estates was $343.20 and that in addition Smiley was entitled to collect $100 for filing fees. The action of the referee was not arbitrary, capricious, or unreasonable. The record sustains it. We will not substitute our judgment for that of the referee and the district court. See In Re Paramount Merrick, Inc., 2 Cir., 252 F.2d 482, 485.

The situation with regard to the corporation is different. The corporation paid no fees. They were paid for it by the O’Bannons. Section 60(d) applies to fees paid by a debtor. Accordingly, there may be no examination under that section of any fees paid to get the corporation into bankruptcy. The problem with regard thereto is whether the payment of those fees by the O’Bannons was a prohibited transfer which diminished the assets of the O’Bannon estates.

Section 67(d)(2)(a) of the Bankruptcy Act, 11 U.S.C. § 107(d)(2)(a), provides that a transfer made by a debtor within one year prior to filing a bankruptcy petition is fraudulent

“as to creditors existing at the time of such transfer * * *, if made * * * without fair consideration by a debtor who is or will be thereby rendered insolvent, without regard to his actual intent.”

The only question presented is whether the transfer was made “without fair consideration.” The referee found that the reasonable fee for the corporation bankruptcy was $312.00 plus $50.00 for filing, and that payment was made by the O’Bannons from their personal funds. The oblique attack which Smiley makes on this finding is immaterial because if the transfer is prohibited the trustee can recover the amount thereof, whatever that may be. The referee concluded that the payment was not a fraudulent transfer and the district court affirmed.

We recognize that fairness of consideration is a factual question and that the burden of persuasion rests on the trustee. Kingdom Uranium Corporation v. Vance, 10 Cir., 269 F.2d 104, 108. The trouble here is that there is a complete absence of consideration. Smiley argues that the financial troubles of the corporation were “bothering” O’Bannon and that what benefited the corporation benefited O’Bannon. The record does not disclose any possible benefit to the O’Bannons except possibly peace of mind. The record contains nothing to show the ownership or interests of the O’Bannons in the corporation or any identity of the individual debts and corporate debts. The most that the record shows is that the payment of the fees benefited the corporation by getting it into voluntary bankruptcy. Transfers made to benefit a third party are not made for the fair consideration required by § 67(d)(2)(a). See 4 Collier on Bankruptcy (14th ed.) jf 67.33, p. 514. Because there was no fair consideration for the transfer, both the referee and the district court erred as a matter of law in concluding that the payment made by the O’Bannons to Smiley for the corporation’s bankruptcy was not fraudulent.

The remaining problem is the disposition of the six appeals before us. A recapitulation is in order. The O’Bannons paid Smiley $1,500.00. We affirm the holding of the referee that the reasonable attorney’s fees, plus the filing fees, in the two individual estates was $443.-20. The finding of the referee that the reasonable attorney’s fee, plus filing fee, in the corporation estate was $362.00 is also affirmed. On the issue of impermissible transfer, we reverse the district court and the referee and hold that the payment by the O’Bannons of $362.00 on account of the corporation bankruptcy was a transfer in violation ' of § 67(d)(2)(a) and is recoverable by the trustee for the individual estates. The result of all this is that Smiley must pay to the trustee of the individual estates $1,056.80 ($1,500.00 less $443.20).

Any effort to sort out these six appeals in a technically correct manner would accomplish nothing. The final result is that Smiley owes the trustee of the individual estates $1,056.80. The best disposition which we can contrive is to order that each appeal is affirmed in part and reversed in part; that each appeal should be remanded for further proceedings in the light of this opinion; and that the trustee shall recover his costs in each appeal from Smiley.

It is so ordered.


author: PER CURIAM.

text:
    UNITED STATES of America, Appellee, v. William Arnold FISHER, Appellant.
    No. 73-1499.
    United States Court oí Appeals, Fourth Circuit.
    Submitted Aug. 20, 1973.
    Decided Sept. 21, 1973.

      L. David Lindauer, Portsmouth, Va., on brief for appellant.
    Brian P. Gettings, U. S. Atty., and Michael A. Rhine, Asst. U. S. Atty., on brief for appellee.
    Before BOREMAN, Senior Circuit Judge, and WINTER and CRAVEN, Circuit Judges.
   PER CURIAM.

The appellant, William Arnold Fisher, seeks reversal of a judgment entered by the trial court sitting without a jury. Fisher was found guilty of conspiracy to smuggle marihuana into the United States, in violation of 21 U.S.C. § 176(a) (now repealed), and was sentenced to the then statutorily mandated minimum term of five years imprisonment. He contends on appeal that the Government failed to prove him guilty beyond a reasonable doubt and that the failure of the prosecution to call a material witness was error.

The indictment named Fisher and two others as defendants; William Truelove, Roy Smith, and Barry Stewart were named as co-conspirators but not as defendants. It was alleged that these individuals conspired to smuggle a quantity of marihuana from Jamaica into the United States by mailing it air freight to Norfolk, Virginia.

The testimony of the chief government witnesses, Smith and Stewart, was contradictory on certain points but, taken as a whole, amply served to establish the conspiracy. Additionally, Fisher admitted the following facts: he had knowledge of the scheme to smuggle the marihuana; he was present with several of the others when their plans to pick up the shipment at the Norfolk airport were discussed; and he was at the airport in the company of Truelove, Stewart, and Smith when Smith made an abortive attempt to pick up the marihuana. Nevertheless, he adamantly denied any participation in or consent to the scheme, claiming that his presence in the company of the others, one of whom he had known for some time, was originally mere happenstance and continued only out of fear for his safety.

It appears there is no question that Truelove, Stewart, Smith, and the other two men conspired to illegally import marihuana. The only issue presented is whether Fisher was a participant in that conspiracy. The lower court found that Fisher had planned to “pull” the marihuana shipment at the airport, that he was present when the other conspirators formulated an alternative scheme for getting the shipment, that he was to receive a share of the marihuana, that he engaged in active efforts to further the conspiracy, and that he was interested in its success.

In considering the sufficiency of evidence, our guideline is that “we do not determine whether it convinces us of guilt beyond a reasonable doubt, but only that the evidence would permit the triers of fact to find the defendant guilty beyond a reasonable doubt.” United States v. Sherman, 421 F.2d 198, 199 (4 Cir. 1970). We conclude that the evidence was amply sufficient to support the finding by the trial court of Fisher’s guilt beyond a reasonable doubt. The trial court’s conclusion that Fisher was involved was based on ari acceptance of Stewart’s version of the events and Fisher’s own testimony. It is not for an appellate court “to weigh the evidence or to determine the credibility of witnesses,” Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 86 L.Ed. 680 (1942), and we must affirm the verdict that Fisher was a willful and active participant in the conspiracy.

Appellant urges there was insufficient evidence to justify the conclusion that he was aware that the marihuana had been illegally imported. Fisher admitted knowledge that Truelove and the others had been smuggling marihuana from Jamaica over a period of time and that the crates at the airport constituted a shipment in that illegal operation. Even without Fisher’s admissions the trial court could have properly found that the marihuana was illegally imported and that Fisher had knowledge of that illegal importation on the basis of evidence given by Fisher’s co-conspirators. United States v. Washington, 429 F.2d 409 (4 Cir.1970), cert, denied, 400 U.S. 919, 91 S.Ct. 181, 27 L.Ed.2d 159 (1970).

The final contention is that reversal is required because the prosecution failed to call a material witness, William Truelove. The record reveals that while Truelove did not testify he was present and available as a witness pursuant to a writ of habeas corpus ad testificandum procured by the prosecution. It is Fisher’s view that the failure of the prosecution to call Truelove when he was available creates a presumption that his testimony would have been unfavorable to the Government. We perceive no merit in this contention.

“We agree that the Government must not suppress evidence favorable to a defendant in any prosecution but, for obvious reasons, a United States Attorney is not bound to call to the witness stand every person who appears pursuant to a subpoena issued and served at Government direction.” United States v. Wallace, 300 F.2d 525, 530 (4 Cir. 1962). An unfavorable inference does not arise from the prosecution’s failure to call a witness where, as here, Fisher knew his identity and availability, did not seek to call him, and made no effort to require the prosecution to call him. United States v. Chase, 372 F.2d 453, 467 (4 Cir. 1967). Where a witness is readily available to both sides, no inference is to be drawn against either party from the fact that he has not been called. United States v. D’Angiolillo, 340 F.2d 453 (2 Cir. 1965), cert, denied, 380 U.S. 955, 85 S.Ct. 1090, 13 L.Ed.2d 972. See Wright, Federal Practice and Procedure: Criminal § 489.

Accordingly, we dispense with oral argument and affirm the judgment below.

Affirmed.


author: BARRETT, Circuit Judge.

text:
    The CITIZENS ENVIRONMENTAL COUNCIL et al., Plaintiffs-Appellants, v. John VOLPE, Secretary of Transportation, et al., Defendants-Appellees.
    No. 73-1158.
    United States Court of Appeals, Tenth Circuit.
    Argued and Submitted Aug. 15,1973.
    Decided Sept. 19, 1973.

      William H. Pickett, Kansas City, Mo., for appellants.
    Terrence L. O’Brien, Dept, of Justice, Washington, D. C. (Robert J. Roth, U. S. Atty., Topeka, Kan.; Wallace H. Johnson, Asst. Atty. Gen., Dept, of Justice, and Roger K. Weatherby, U. S. Atty., Topeka, Kan.; Edmund B. Clark and George R. Hyde, Dept, of Justice, Washington, D. C., on the brief), for ap-pellees.
    Donna Munn Heller, State Highway Commission of Kansas, Topeka, Kan. (James H. DeCoursey, Jr., and Paul W. Clark, State Highway Commission, Topeka, Kan., on the brief), for appellee State Highway Commission of Kansas.
    Wright W. Crummett, Overland Park, Kan., for intervenor-appellee City of Overland Park, Kansas.

      F. Philip Kirwan, Kansas City, Mo. (Gordon R. Gaebler and Blake A. Williamson, Kansas City, Mo., on the brief; of counsel: Margolin & Kirwan, Kansas City, Mo. and Williamson, Cubbison & Hardy, Kansas City, Kan.), for interve-nor-appellees J. A. Tobin Construction Co.
    Before LEWIS and BARRETT, Circuit Judges and SMITH, District Judge.

       For the Eastern District of Michigan, sitting by designation.

   BARRETT, Circuit Judge.

The Citizens Environmental Council (CEC) brought this action to enjoin construction of a federally-assisted highway by-pass. The District Court granted a summary judgment in favor of the defendants-appellees. See The Citizens Environmental Council v. Volpe, 364 F. Supp. 286 (D.Kan.1973).

The State of Kansas plans to relocate 2.76 miles of U. S. Route 69, the Switzer By-Pass, in the cities of Overland Park and Lenexa, Kansas, close to Kansas City, Kansas and Kansas City, Missouri. The suit involves the northern leg of the by-pass which will connect two interstate highways, 1-35 and 1-435. The bypass plan originated from a traffic study in 1959. Its location was chosen prior to urbanization of the area but with the expectation of increased population in the future.

On April 2, 1959, pursuant to 23 U.S. C.A. § 128(a), the Kansas State Highway Commission (SHC) conducted a public hearing at Olathe, Kansas to discuss the proposed by-pass. On August 26, 1959, the Federal Highway Administration División Engineer approved the by-pass. It was also approved by the Regional Engineer. In 1962 the Division Engineer approved SHC’s request to acquire the right-of-way. Right-of-way acquisition occurred during 1962-1964 at a time when the area was still rural in character.

Congress enacted the National Environmental Policy Act (NEPA) in 1969, effective January 1, 1970. Section 102 (2) of NEPA requires all federal agencies to submit an environmental impact statement in each recommendation for major federal actions significantly affecting the quality of the human environment. 42 U.S.C.A. § 4332(2) (C). The Council on Environmental Quality (CEQ) issued Interim Guidelines for preparation of the impact statement. It also provided for a draft statement and a final statement. Policy and Procedure Memorandum (PPM) 20-8 was issued in January of 1969 providing for a corridor hearing and a design hearing. Pursuant to PPM 20-8, the design hearing provides an opportunity to present views on major design features including social, economic, environmental and other effects of alternative designs. The social, economic and environmental considerations include the effects of aesthetics, noise, air and water pollution, and displacement of families and businesses.

On April 23, 1971 the design hearing was held in Overland Park, Kansas. The Final Environmental Impact Statement (EIS) was filed with the CEQ on August 26, 1971. Comments by Ruckel-shaus, Administrator of The Environmental Protection Agency, were included.

The CEC contends that: (1) the EIS is inadequate; (2) an additional hearing is necessary; and (3) the Court erred in granting appellees’ motion for summary judgment.

The CEC alleges that the impact statement is inadequate because it was prepared by the State Highway Commission and because it does not detail alternative routes. The statute provides that the EIS must include:

(i) the environmental impact of the proposed action,
(ii) any adverse environmental effects which cannot be avoided should the proposal be implemented,
(iii) alternatives to the proposed action,
(iv) the relationship between local short-term uses of man’s environment and the maintenance and enhancement of long-term productivity, and
(v) any irreversible and irretrievable commitments of resources which would be involved in the proposed action should it be implemented.

42 U.S.C.A. § 4332(2) (C).

The SHC prepared the impact statement in consultation with state, federal and private agencies. The Secretary of Transportation did not simply “rubber stamp” the State’s work. He reviewed it and adopted it as his own. This procedure is consistent with the goals of NEPA. Finish Allatoona’s Interstate Right, Inc. v. Volpe, 355 F. Supp. 933 (N.D.Ga.1973).

The EIS analyzed possible alternative routes, including abandonment of the project, and concluded that they would be in conflict with projected growth patterns. We may certainly anticipate particular circumstances which require an exhaustive, painstaking and extensive report of the environmental effects of alternatives in the EIS. Such, however, is not required in the case at bar. The discussion of the environmental effects of alternatives in the EIS in this case are sufficient to allow a reasoned choice. The EIS prepared by the SHC and adopted by the FHWA fully complies with NEPA requirements.

The CEC alleges that an additional corridor hearing was necessary. The equivalent of a corridor hearing was held in 1959. The land was acquired in the early 1960’s. A design hearing was held in 1971. The 1959 hearing met the requirements of PPM 20-8. A new corridor hearing is therefore not required. PPM 20-8 does not apply retroactively. Wildlife Preserves, Inc. v. Volpe, 443 F.2d 1273 (3rd Cir. 1971).

The CEC contends that there were many genuine issues of material fact presented to the trial court. It relies on several conclusory affidavits and a letter from the EPA dated May 4, 1972, stating that there is a lack of data on air pollution and noise levels.

Four affidavits were filed by the CEC to oppose the summary judgment. They are generalized, conclusionary and unsubstantiated. They are insufficient to create a genuine factual dispute. Ashwell & Company v. Transamerica Insurance Company, 407 F.2d 762 (7th Cir. 1969). Rule 56(e), Fed. R.Civ.P., requires personalized affidavits to successfully oppose a motion for summary judgment.

EPA’s comments filed on May 4, 1972 were “category 2” comments according to its procedure. They were merely comments of inadequate information but not a condemnation of the project itself. We observe also that these comments were received eight months after the final EIS was filed with the CEQ and six months after design approval by FHWA. EPA had no comment during the period of review following the design hearing. The EIS, in fact, discloses an awareness of noise impact and notes the selection of a depressed main line design to muffle it and to reduce air pollution in the corridor area.

The trial court did not err in granting a summary judgment to the appellees. See The Citizens Environmental Council v. Volpe, supra.

Affirmed.


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    UNITED STATES of America ex rel. Gerald Daniel WALKER, Petitioner-Appellant, v. John J. TWOMEY, Respondent-Appellee. UNITED STATES of America ex rel. Sherman Anthony KANE, Petitioner-Appellant, v. Peter BENSINGER, etc., et al., Respondents-Appellees.
    Nos. 72-1096, 73-1028.
    United States Court of Appeals, Seventh Circuit.
    No. 72-1096 Argued Oct. 16, 1972.
    No. 73-1028 Submitted May 18, 1973.
    Decided Aug. 27, 1973.

      John T. Perry, Wheaton, Ill., Cornelius E. Toole, Chicago, Ill., for petitioners-appellants.
    William J. Scott, Atty. Gen., Morton Friedman, James B. Zagel and Melbourne A. Noel, Jr., Asst. Attys. Gen., Chicago, 111., for respondents-appellees.
    Before SWYGERT, Chief Judge, KNOCH, Senior Circuit Judge, and FAIRCHILD, Circuit Judge.
   PER CURIAM.

Several judges of the district court for the northern district of Illinois have arrived at conflicting views concerning a rule to be applied where persons convicted of crime in a state court are denied bail pending appeal.

Judge Will has applied a rule that when the state court denies bail pending appeal and does not express any basis for its denial, such omission creates a presumption of arbitrariness. United States ex rel. Keating v. Bensinger, 322 F.Supp. 784 (N.D.Ill., 1971). In decisions now under review. Judge Napoli in Walker, and Judge Decker in Kane, declined to apply that presumption. In each case habeas relief was denied because the court concluded that petitioner had not shown that the record provides no rational basis for the decision.

There is little disagreement on the preliminary steps of the analysis. The provision of the eighth amendment prohibiting excessive bail is assumed to be binding on the states. Whatever the content of the constitutional protection with respect to bail, binding upon the states, it is clear that once a state has made provision for bail pending appeal, the arbitrary denial of bail violates the fourteenth amendment.

Codification controlling release pending appeal in the federal system is found in 18 U.S.C. § 3148. The risk of flight, probability that the convicted person will pose a danger to another or to the community, and lack of merit in the appeal are appropriate considerations, and one or a combination of those factors may justify denial of release or, in some cases, imposition of more onerous conditions of release, including bail.

Rule 9, F.R.A.P., provides that after a conviction in federal district court, if the district court refuses release pending appeal, or imposes conditions of release, the court shall state in writing the reasons for the action taken. We draw on our own experience in' considering appellants’ requests for release after denial by a district court to observe that written reasons for denial or imposition of high bail are most helpful in performing our task. We are, in those instances, reviewing decisions of courts in the same system, over which we have appellate jurisdiction, in order to implement federal judicial policy. Although the word “review” is sometimes loosely used with respect to exercise of federal habeas corpus jurisdiction where a state court decision is being collaterally attacked, this is an inappropriate use of the term.

It is fair to say that there is strong federal judicial'policy in favor of release on bail pending appeal unless the appeal appears to be frivolous or dilatory.

It does not necessarily follow that present federal judicial policy, either substantive or procedural, with respect to bail pending appeal from a criminal conviction, is an exact measure of a right with respect to bail on appeal, protected against state action by the fourteenth amendment.

The fact that articulation by a state court of its reasons for denial of release on bail would usually make it easier for a federal court, considering a petition for habeas corpus, to decide whether the denial could be said to have a rational basis, does not authorize federal courts to impose that procedural requirement on state courts. We agree with Judge Decker that reliance on a presumption of regularity is appropriate at this point, Johnson v. Zerbst, 304 U.S. 458, 468, 58 S.Ct. 1019, 82 L.Ed. 1461 (1938), and in the conclusion stated in his decision in Kane:

“In sum, this court believes that the burden in these cases should rest on the convicted defendant to show that the state court has acted in an arbitrary fashion and that a ‘presumption of regularity’ should attend all decisions of the state courts and not only those accompanied by oral or written explanations. This is not to say that the petitioner has lost his constitutional right or remedy. He can still attack the decision to deny him bail. He must, however, bear the burden of showing that the record provides no rational basis for the decision.”

The merits of Walker’s claim.

Walker, age 39, was convicted of attempted murder and aggravated battery, and received concurrent sentences. The sentence for attempted murder was 16-20 years. Beginning in 1954, Walker committed ten armed robberies in Ohio and Florida, and served terms of imprisonment in those states. In opposing the petition for release in state court, the state alleged that Walker had attempted a jail break while awaiting trial on the present charges, had threatened the lives of cellmates and that he admitted always carrying a loaded gun. Walker listed four general assignments of error, but there was nothing to show the substan-tiality of these claims. Although the state court had before it Walker’s showing that he had been released on early parole in Ohio, that he is a resident of Illinois (a fact disputed by the state), and that he had a successful experience on parole, and a record of perfect attendance in court several years earlier while free on bond in a prosecution for aggravated battery (ending in acquittal upon a second trial), we are unable to say on consideration of this record that there was no rational basis for denial of release on bail pending appeal.

The merits of Kane’s claim.

Kane, age 33, was convicted of possession of heroin and marijuana and received concurrent sentences. The sentence on the heroin count was 7-15 years. The narcotics were found in Kane’s automobile after he met with an accident. The heroin had a street value of $20,000. Kane had $1500 cash and a loaded pistol with shoulder holster. The circumstances clearly indicated that he, with his passenger, was on his way to make sales of heroin in several small towns. He made no showing that his appeal would present arguable questions. Although he stated that, if released, he would reside with his family in Chicago, that he was an honorably discharged veteran, and that he had steady employment, we conclude he has not shown that the record provides no rational basis for denial of release pending appeal.

Accordingly the judgments appealed from are affirmed.

      . Judge Friendly has written that, “Although this provision of the Bill of Rights has not yet been held by the Supreme Court to be one of those made applicable to the states through the Fourteenth Amendment, we entertain little doubt that it will be.” United States ex rel. Goodman v. Kehl, 456 F.2d 863, 868 (2d Cir., 1972.).


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    ROCHELLE BAIL AGENCY, INC., Plaintiff-Appellant, v. MARYLAND NATIONAL INSURANCE COMPANY, and Century Surety Underwriters, Inc., Defendants-Appellees, and William E. Roe, and Norman Z. Flick, Third Party Defendants-Appellees.
    No. 71-1622.
    United States Court of Appeals, Seventh Circuit.
    Argued Nov. 30, 1972.
    Decided Aug. 17, 1973.
    Donald A. Schabel, Frederick J. Frosch, Indianapolis, Ind., for plaintiff-appellant.
    D. Robert Webster, Alan H. Lobley, James W. Treacy, Dean E. Richards, Indianapolis, Ind., for defendants-appel-lees.

      Before HASTINGS, Senior Circuit Judge, CAMPBELL, Senior District Judge, and MORGAN, District Judge.

       Senior District Judge William J. Campbell of the Northern District of Illinois is sitting by designation.

       District Judge Robert D. Morgan of the Southern District of Illinois is sitting by designation.

   WILLIAM J. CAMPBELL, Senior District Judge.

Following a bench trial in the Southern District of Indiana, judgment was entered for the defendants in a diversity-action brought to recover on an indemnity contract. We affirm.

The plaintiff, Rochelle Bail Agency, Inc. (“Rochelle”), as well as the defendants herein are .either bail bondsman, corporate bonding companies or their agents. In mid-1966, a client of third-party defendant Norman Z. Flick, one Sherman Kaminsky, was under federal indictment in the Southern District of New York. Attempting to secure Ka-minsky’s release on bail prior to trial, Flick contacted the defendant Maryland National Insurance Company (“Maryland”) and requested that it secure a bond for Kaminsky from its New York correspondent. Maryland contacted the plaintiff in New York and it agreed to write the bond for Kaminsky. The consideration for this undertaking was a full commission for the plaintiff and a complete indemnity from Maryland to hold the plaintiff harmless against loss should Kaminsky flee. Ultimately, Kaminsky entered a plea of guilty to the New York charge, but failed to appear before the court on August 16,1966, the date set for sentencing.

During the summer and fall of 1966, Rochelle wrote other bonds for Kamin-sky in the state courts of New York, without any apparent communication between it and the defendant. One of these bonds was written on October 19, 1966, several months after Kaminsky had been in default in the federal court. Although Rochelle dealt personally with Kaminsky at this time, it did not inquire of him as to the status of the federal case or, specifically, whether he had attended his sentencing. Rochelle exercised no form of supervision over Ka-minsky during this period of time.

Thereafter, on May 24, 1967, the federal court in New York ordered Kamin-sky’s bond forfeited. Appropriate notices were sent to Rochelle and to Cosmopolitan Mutual Insurance Company, a corporate surety with whom Rochelle places its bonds. Cosmopolitan paid the face amount of the bond and debited Rochelle’s reserves in a like sum. Rochelle then made demand on Maryland under its indemnity agreement. Maryland refused to pay and this suit followed.

Upon these undisputed facts, the district court ruled that Rochelle had breached its duty as a bail bondsman to supervise Kaminsky and insure his presence in the federal court action. It further held that the plaintiff's failure to supervise Kaminsky materially increased Maryland’s risks under the indemnity agreement, thereby discharging Maryland from its obligations thereunder. See Risk v. Risk, 138 Ind.App. 224, 213 N.E.2d 334 (1966); American Casualty Co. v. Idaho First National Bank, 328 F.2d 138 (9th Cir. 1964); Hiern v. St. Paul-Mercury Indemnity Co., 262 F.2d 526 (5th Cir. 1959).

Plaintiff argues on appeal that it owed no duty to its indemnitors to supervise Kaminsky on bail, or to secure his appearance for sentencing. It is well settled, of course, that the purpose of a bail bond is to secure the presence of an accused to answer a pending charge and to respond to the court’s judgment. Smith v. United States, 357 F.2d 486 (5th Cir. 1966). In order to enhance the likelihood of a defendant’s cooperation with the judicial process, a bond designed to insure obedience to the court’s orders is often required. Where a third-party, such as a bondsman, undertakes to assure a defendant’s appearance, and secures that promise through a financial stake, there arises a duty on the part of the bondsman to exercise some minimal supervision over the defendant in order to accomplish his continued appearance. See United States v. Payne, 272 F.Supp. 939, 941 (D.Conn. 1967). While this duty does not amount to an absolute guarantee of the defendant’s presence, it does encompass making some effort toward that end.

While Rochelle does not maintain that it owes no duty of minimal supervision to the court having jurisdiction over the defendant, it does contend that it owes no such duty to an indemnitor. In this regard, Rochelle relies on language appearing in an opinion of the Florida District Court of Appeals to the effect that where the surety on a bail bond is indemnified by a third-party, the indem-nitor is the true bondsman since he bears the ultimate risk of loss. United Bonding Insurance Co. v. Tuggle, 216 So.2d 80, 82 (Fla.App.1968). The remarks of the Florida appeals court were not intended, however, to hold that the existence of the indemnity agreement excuses the surety from exercising any supervision over a defendant. That question was simply not before the Florida court. The court was called upon to decide only the effect of a Florida statute which required an affidavit disclosing the indemnity agreement be filed, simultaneously with the bail bond. The court there held that the purpose of this statute was to place the indemnitor on an equal footing with the surety on the bond so that they might both protect the property risked through the indemnity agreement. If the intention of the Florida legislature was to place the surety and the indemnitor on “equal footing” then we must conclude that the surety is not thereby excused from his duty of supervision arising from the bail bond relationship. See also, Carr v. Sutton, 70 W.Va. 417, 74 S.E. 239 (1912).

Our review of the sparse authority on this issue convinces us that the existence of an indemnity agreement does not release a surety on a bail bond from his responsibility to minimally supervise a criminal defendant. Therefore, Rochelle’s breach of its duty to maintain some supervision over Kaminsky increased Maryland’s risk under the indemnity agreement, and thereby extinguished its obligation thereunder.

The judgment of the district court for the Southern District of Indiana is affirmed.

Affirmed.

      . Rochelle’s contention that Kaminsky departed the State of New York and therefore was not within Rochelle’s area of supervision also does not persuade. In this regard, we agree with the district court that the enlargement of the conditions of Kaminsky’s New York bond so that he might travel to the State of Illinois falls short of demonstrating that Kaminsky, in fact, left the State of New York.