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State v. Phelps

Decided: June 25, 1984.

STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT,
v.
JOHN PHELPS, A/K/A J.P., A/K/A JOHNNY, DEFENDANT-APPELLANT



On certification to the Superior Court, Appellate Division, whose opinion is reported at 187 N.J. Super. 364 (1983).

For affirmance -- Chief Justice Wilentz and Justices Clifford, Schreiber, Pollock and Garibaldi. Dissenting -- Justices Handler and O'Hern. The opinion of the Court was delivered by Schreiber, J. Handler, J., dissenting. Justice O'Hern joins in this dissent.

Schreiber

[96 NJ Page 504] Defendant, John Phelps, a police officer, was acquitted of unlawfully conspiring with three individuals named DeMarco, Gerrizzo, and Hirtler to promote gambling and to maintain a gambling resort in violation of N.J.S.A. 2C:37-2, N.J.S.A.

2C:37-4, and N.J.S.A. 2C:5-2. During the trial, the court dismissed a charge of conspiracy to commit official misconduct by knowingly refraining from performing the duties of a police officer. However, defendant was convicted of misconduct in office by failing to report a gambling enterprise, contrary to N.J.S.A. 2C:30-2b. Defendant was sentenced to a five-year term in the New Jersey State Prison.

The key prosecution evidence consisted of (1) the composite tapes derived from wiretaps of telephone conversations between the defendant and coconspirators and between coconspirators, and (2) the bookmaker's log sheets, which reflected the transactions discussed in the taped conversations. Defendant offered no evidence.

Defendant appealed on numerous grounds. The most substantial legal issue concerned the trial court's admission of the taped statements of coconspirators under Evid.R. 63(9)(b), the coconspirator's hearsay exception. The Appellate Division affirmed the conviction. 187 N.J. Super. 364 (1983). We granted the defendant's petition for certification limited to the issue of the admissibility of statements made by coconspirators out of the presence of the defendant. 93 N.J. 309 (1983).

I

The indictment was the culmination of an investigation by the Morris County Prosecutor's office of gambling activities in the vicinity of Parsippany-Troy Hills. Detective Michael Romano, who was in charge of the investigation, obtained judicial orders pursuant to N.J.S.A. 2A:156A-10 to tap the telephones of Angelo Gerrizzo and Thomas DeMarco, both of whom were believed to be key figures in the gambling operations. The prosecutor's investigators intercepted hundreds of telephone calls involving bets on college and professional football games. The investigators identified forty-three different persons who discussed bets with Gerrizzo by telephone. Nearly all the callers used a code name, e.g., "Slicer," "Doc," "J.P."

The investigation culminated in raids of Gerrizzo's and DeMarco's apartments sanctioned by valid search warrants. During the search of Gerrizzo's apartment, one investigator received telephone calls placing bets. The police seized various notebooks documenting gambling activities, address books, and memo pads from Gerrizzo's and DeMarco's apartments. The code names and wagered amounts recorded in the books corresponded with those of the wiretapped phone calls.

Gerrizzo was the "sitter," the person who would sit by the telephone and record wagers as they were phoned in to him. Gerrizzo reported to DeMarco, the "controller," who would oversee the entire operation, including the receipt of wagers, the pay-off of successful bets, and the collection of gambling debts.

Both Gerrizzo and DeMarco resided in garden apartments located in a section of Parsippany-Troy Hills within the area patrolled by the defendant as a police officer. Defendant never reported this illegal gambling activity to his superiors. Proof of defendant's knowledge of this situation was a crucial element in the State's case. Tapes of eight telephone calls to Gerrizzo had been made by a person who identified himself as "J.P." (the initials of defendant's name, John Phelps) or "Johnny." The prosecutor presented a composite tape of seven of these calls and Detective Romano identified the voice of "J.P." or "Johnny" as defendant's.

The tapes also included twenty-seven conversations between "Bill from Bach's" (code name for William Gotshall, a bartender at Bach's Tavern in Lake Hiawatha) and Gerrizzo. During these conversations there were references to "J.P." or "Johnny." In one conversation Gotshall mentioned defendant's full name. That conversation pertained to a dispute over the balance in the gambling account shared by defendant and Gotshall. Gerrizzo quoted a figure and Gotshall insisted it should be higher. At that point Gerrizzo suggested that he review the preceding day's action.

G. Let's go over it, okay?

B. Yeah.

G. Alright, you had New England 100 times; you're minus 550. The Jets 30 times, minus 165.*fn1

B. Uh, what are the times?

G. 30 times, Jets.

B. Yeah? Oh yeah, that was Johnny Phelps, yeah, o.k.

Gotshall's remark about "Johnny Phelps" suggests that he had forgotten that the defendant had placed a bet on the Jets on the previous day. More significantly, it suggests defendant's identification as the oft-mentioned "J.P." This hearsay also corroborated the earlier testimony identifying "J.P.'s" voice on the composite tape as that of defendant. Other discussions between Gerrizzo and DeMarco further confirmed that "J.P." and "Bill from Bach's" had a relationship as joint bettors.

The Gerrizzo-DeMarco tapes also were evidential in proving that defendant had introduced another bettor with the code name "Big Pete" into the operation. One pertinent conversation went as follows:

G. J.P. gave me some guy he said was going to call me. His name is Pete.

D. Pete?

G. Big Pete.

D. Big Pete.

G. Yeah. I don't know if he is going to call for J.P. I don't know if he is going to call himself. I don't know. Uh, he says, "There's a guy, Big Pete. He is going to call you." He says, "It's all right." I say, "Sure. I mean, is it all right with you? I mean, if there is -- you know -- you know -- I don't want to get in any [expletive] trouble, so I will be." I say, "You know, is it okay?"

D. Uh, all right. No problem. Good.

The defendant objected to the admission of the conversations between "Bill from Bach's" (Gotshall) and Gerrizzo and between Gerrizzo and DeMarco. The trial court ruled that the conversations were admissible as declarations by a coconspirator under Evid.R. 63(9), despite the defendant's contentions

that (1) there was insufficient proof of a conspiracy and of defendant's participation in the conspiracy, and that such proof was a condition precedent to the admissibility of the hearsay, and (2) the court should have instructed the jurors to disregard the hearsay conversations if they found that such independent proof of a conspiracy was lacking.

II

A statement, made other than by a witness while testifying, offered to prove the truth of the content of the statement is hearsay evidence and is inadmissible unless it falls within one of the hearsay exceptions, most of which are found in Rule 63(1) through Rule 63(32). Evid.R. 63. The exceptions are justified primarily because the circumstances under which the statements were made provide strong indicia of reliability. See State v. Humphrey, 183 N.J. Super. 580, 589 (Law Div.1982); Brooks, "Evidence," 14 Rutgers L.Rev. 390, 410-11 (1960) (contending that coconspirator's hearsay statements not be admissible unless there is some intrinsic guarantee of reliability); cf. Levie, "Hearsay and Conspiracy, A Reexamination of the Co-Conspirators' Exception to the Hearsay Rule," 52 Mich.L.Rev. 1159, 1163-66 (1954) (advocating admissibility because of "the very great probative need for it").

The coconspirator exception to the hearsay rule may be stated simply as follows: where two or more persons are alleged to have conspired to commit a crime or a civil wrong, any statement made by one during the course of and in furtherance of the conspiracy is admissible in evidence against any other member of the conspiracy. Evid.R. 63(9)(b). The admissibility of a statement of a coconspirator has been firmly entrenched in our jurisprudence. As early as 1791 the Supreme Court held in Patton v. Freeman, 1 N.J.L. 134, 136, that a conversation among conspirators in the defendant's absence was admissible when there was proof of a conspiracy between the defendant and the declarants to perpetuate a fraud. Numerous

opinions since then have reconfirmed this exception to the hearsay rule. E.g., State v. Fischman, 108 N.J.L. 550, 551 (E. & A.1931); State v. Seidman, 107 N.J.L. 204, 206-07 (Sup.Ct.1931); State v. Dougherty, 86 N.J.L. 525, 540-41 (Sup.Ct.1915).

Presenting to a jury relevant and material evidence furthers its fact-finding ability to discern where the truth lies. Thus, admissibility into evidence of a coconspirator's statement may advance that goal. This is particularly so in crimes involving conspiracy and fraud where much of the offense is effectuated through unwritten statements passed from one to another. It has been said, "silence, furtiveness and secrecy shroud the conduct and speech of coconspirators." Note, "The Coconspirator's Exception to the Hearsay Rule: Bootstrapping in the New Procedure from the First Circuit," 50 U.Colo.L.Rev. 93, 103-04 (1978). Coconspirator's hearsay may be essential to establishing the existence of an illicit agreement or association between them. Levie, supra, at 1163-66. This is especially significant in cases of organized crime.

When the Rules of Evidence were codified by this Court and the Legislature in 1967, N.J.S.A. 2A:84A-1 to -49, Evid.R. 63(9)(b) was formally adopted.*fn2 The rule in pertinent part reads:

A statement which would be admissible if made by the declarant at the hearing is admissible against a party if * * * (b) at the time the statement was made the party and the declarant were participating in a plan to commit a crime or civil wrong and the statement was made in furtherance of that plan.

Three distinct conditions must be met for statements to qualify for admissibility under the Rule. First, the statement

must have been made in furtherance of the conspiracy. State v. Rios, 17 N.J. 572, 596 (1955). Second, the statement must have been made during the course of the conspiracy. State v. Carbone, 10 N.J. 329, 340 (1952); State v. Yedwab, 43 N.J. Super. 367, 374 (App.Div.), certif. denied, 23 N.J. 550 (1957). Lastly, our courts have held that there must be evidence, independent of the hearsay, of the existence of the conspiracy and defendant's relationship to it. State v. Boiardo, 111 N.J. Super. 219, 230-31 (App.Div.), certif. denied, 57 N.J. 130 (1970), cert. denied, 401 U.S. 948, 91 S. Ct. 931, 28 L. Ed. 2d 231 (1971); State v. Hacker, 167 N.J. Super. 166, 174 (Law Div.1979).

The first two conditions reflect notions that an agent's statements are vicariously attributable to a principal. See State v. Carbone, supra, 10 N.J. at 339-40 (ascribing the theory of admissibility to a joint or mutual agency and stating that the "acts and declarations of an agent, within the scope of his authority, are considered and treated as the acts and declarations of his principal"). The rationale is that participation in a conspiracy confers upon coconspirators the authority to act in another's behalf to achieve the goals of the common scheme. Since conspirators are substantively liable for the acts of their coconspirators in furtherance of the common plan, so too should they be responsible for statements uttered by coconspirators to further that plan. See Morgan, "The Rationale of Vicarious Admissions," 42 Harv.L.Rev. 461 (1929). Judge Learned Hand explained:

Such declarations are admitted upon no doctrine of the law of evidence, but of the substantive law of crime. When men enter into an agreement for an unlawful end, they become ad hoc agents for one another, and have made "a partnership in crime." What one does pursuant to their common purpose, all do, and, as declarations may be such acts, they are competent against all. [ Van Riper v. United States, 13 F.2d 961, 967 (2d Cir.1926).]

The last requirement, that the existence of a conspiracy and defendant's participation be demonstrated by evidence other than the hearsay statement sought to be admitted against the coconspirator, reduces the fear that a defendant might be convicted or held liable in damages solely on the basis of

evidence that he has had no opportunity to impeach or refute. See Flintkote Co. v. Lysfjord, 246 F.2d 368, 386-87 (9th Cir.), cert. denied, 355 U.S. 835, 78 S. Ct. 54, 2 L. Ed. 2d 46 (1957). In Glasser v. United States, 315 U.S. 60, 75, 62 S. Ct. 457, 467, 86 L. Ed. 680, 701 (1942), the Supreme Court observed that in the absence of such independent evidence "hearsay would lift itself by its own boot straps to the level of competent evidence."

The independent evidence may take many forms. There may be documentary material, such as books and records, testimony of witnesses, or other relevant evidence. There may be a combination of different types of proof. The evidence may be direct or circumstantial. In any event the independent evidence must be substantial enough to engender a strong belief in the existence of the conspiracy and of defendant's participation.

This general requirement does not preclude the trial court, in determining whether the coconspirator hearsay exception should apply, from considering some hearsay evidence in conjunction with independent evidence. If the independent evidence is substantial, the trial court may also consider a coconspirator's hearsay statements that it decides are reliable and trustworthy to determine whether the State has met its burden of proving the existence of the conspiracy and the defendant's participation in it.

An important circumstance is that the nature of the hearsay should engender a strong sense of its inherent trustworthiness. Here, where telephone conversations have been taped during interceptions authorized by law and the integrity of the tapes assured, the dependability of the taped conversation would justify reliance on their content. So, too, when the declarant makes statements supportive of the existence of a conspiracy of which he is a part, its trustworthiness is enhanced because of the likelihood that he would not have made ...


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