A defendant in a criminal case in a federal court may be
required to stand trial, and his conviction may be sustained, where
only hearsay evidence was presented to the grand jury which
indicted him. Pp.
350 U. S.
359-364.
(a) An indictment based solely on hearsay evidence does not
violate the provision of the Fifth Amendment that "No person shall
be held to answer for a capital, or otherwise infamous crime,
unless on a presentment or indictment of a Grand Jury. . . ." Pp.
350 U. S.
361-363.
(b) In the exercise of its power to supervise the administration
of justice in the federal courts, this Court declines to establish
a rule permitting defendants in criminal cases to challenge
indictments on the ground that they are not supported by adequate
or competent evidence. Pp.
350 U. S. 363-364.
221 F.2d 668, affirmed.
MR. JUSTICE BLACK delivered the opinion of the Court.
We granted certiorari in this case to consider a single
question:
"May a defendant be required to stand trial and a conviction be
sustained where only hearsay evidence was presented to the grand
jury which indicted him?"
350 U.S. 819.
Petitioner, Frank Costello, was indicted for wilfully attempting
to evade payment of income taxes due the
Page 350 U. S. 360
United States for the years 1947, 1948, and 1949. [
Footnote 1] The charge was that petitioner
falsely and fraudulently reported less income than he and his wife
actually received during the taxable years in question. Petitioner
promptly filed a motion for inspection of the minutes of the grand
jury and for a dismissal of the indictment. His motion was based on
an affidavit stating that he was firmly convinced there could have
been no legal or competent evidence before the grand jury which
indicted him, since he had reported all his income and paid all
taxes due. The motion was denied. At the trial which followed, the
Government offered evidence designed to show increases is
Costello's net worth in an attempt to prove that he had received
more income during the years in question than he had reported.
[
Footnote 2] To establish its
case, the Government called and examined 144 witnesses and
introduced 368 exhibits. All of the testimony and documents related
to business transactions and expenditures by petitioner and his
wife. The prosecution concluded its case by calling three
government agents. Their investigations had produced the evidence
used against petitioner at the trial. They were allowed to
summarize the vast amount of evidence already heard, and to
introduce computations showing, if correct, that petitioner and his
wife had received far greater income than they had reported. We
have held such summarizations admissible in a "net worth" case like
this.
United States v. Johnson, 319 U.
S. 503.
Page 350 U. S. 361
Counsel for petitioner asked each government witness at the
trial whether he had appeared before the grand jury which returned
the indictment. This cross-examination developed the fact that the
three investigating officers had been the only witnesses before the
grand jury. After the Government concluded its case, petitioner
again moved to dismiss the indictment on the ground that the only
evidence before the grand jury was "hearsay," since the three
officers had no firsthand knowledge of the transactions upon which
their computations were based. Nevertheless, the trial court again
refused to dismiss the indictment, and petitioner was convicted.
The Court of Appeals affirmed, [
Footnote 3] holding that the indictment was valid even
though the sole evidence before the grand jury was hearsay.
[
Footnote 4] Petitioner here
urges: (1) that an indictment based solely on hearsay evidence
violates that part of the Fifth Amendment providing that
"No person shall be held to answer for a capital, or otherwise
infamous crime, unless on a presentment or indictment of a Grand
Jury . . . ,"
and (2) that, if the Fifth Amendment does not invalidate an
indictment based solely on hearsay, we should now lay down such a
rule for the guidance of federal courts.
See McNabb v. United
States, 318 U. S. 332,
318 U. S.
340-341.
The Fifth Amendment provides that federal prosecutions for
capital or otherwise infamous crimes must be
Page 350 U. S. 362
instituted by presentments or indictments of grand juries. But
neither the Fifth Amendment nor any other constitutional provision
prescribes the kind of evidence upon which grand juries must act.
The grand jury is an English institution, brought to this country
by the early colonists and incorporated in the Constitution by the
Founders. There is every reason to believe that our constitutional
grand jury was intended to operate substantially like its English
progenitor. The basic purpose of the English grand jury was to
provide a fair method for instituting criminal proceedings against
persons believed to have committed crimes. Grand jurors were
selected from the body of the people, and their work was not
hampered by rigid procedural or evidential rules. In fact, grand
jurors could act on their own knowledge, and were free to make
their presentments or indictments on such information as they
deemed satisfactory. Despite its broad power to institute criminal
proceedings, the grand jury grew in popular favor with the years.
It acquired an independence in England free from control by the
Crown or judges. Its adoption in our Constitution as the sole
method for preferring charges in serious criminal cases shows the
high place it held as an instrument of justice. And, in this
country, as in England of old, the grand jury has convened as a
body of laymen, free from technical rules, acting in secret,
pledged to indict no one because of prejudice and to free no one
because of special favor. As late as 1927, an English historian
could say that English grand juries were still free to act on their
own knowledge if they pleased to do so. [
Footnote 5] And, in 1852, Mr. Justice Nelson, on
circuit, could say
"No case has been cited, nor have we been able to find any,
furnishing an authority for looking into and revising the judgment
of the grand jury upon the evidence, for the purpose of
Page 350 U. S. 363
determining whether or not the finding was founded upon
sufficient proof. . . ."
United States v. Reed, 27 Fed.Cas. pages 727, 738.
[
Footnote 6]
In
Holt v. United States, 218 U.
S. 245, this Court had to decide whether an indictment
should be quashed because supported in part by incompetent
evidence. Aside from the incompetent evidence, "there was very
little evidence against the accused." The Court refused to hold
that such an indictment should be quashed, pointing out that "[t]he
abuses of criminal practice would be enhanced if indictments could
be upset on such a ground." 218 U.S. at
218 U. S. 248.
The same thing is true where, as here, all the evidence before the
grand jury was in the nature of "hearsay." If indictments were to
be held open to challenge on the ground that there was inadequate
or incompetent evidence before the grand jury, the resulting delay
would be great indeed. The result of such a rule would be that,
before trial on the merits, a defendant could always insist on a
kind of preliminary trial to determine the competency and adequacy
of the evidence before the grand jury. This is not required by the
Fifth Amendment. An indictment returned by a legally constituted
and unbiased grand jury, [
Footnote
7] like an information drawn by the prosecutor, if valid on its
face, is enough to call for trial of the charge on the merits. The
Fifth Amendment requires nothing more.
Petitioner urges that this Court should exercise its power to
supervise the administration of justice in federal
Page 350 U. S. 364
courts and establish a rule permitting defendants to challenge
indictments on the ground that they are not supported by adequate
or competent evidence. No persuasive reasons are advanced for
establishing such a rule. It would run counter to the whole history
of the grand jury institution, in which laymen conduct their
inquiries unfettered by technical rules. Neither justice nor the
concept of a fair trial requires such a change. In a trial on the
merits, defendants are entitled to a strict observance of all the
rules designed to bring about a fair verdict. Defendants are not
entitled, however, to a rule which would result in interminable
delay but add nothing to the assurance of a fair trial.
Affirmed.
MR. JUSTICE CLARK and MR. JUSTICE HARLAN took no part in the
consideration or decision of this case.
[
Footnote 1]
The indictment was based on § 145(b) of the Internal
Revenue Code of 1939, 53 Stat. 63. There was also a count in the
indictment for the year 1946, but petitioner was found not guilty
of this charge.
[
Footnote 2]
For discussions of the "net worth method,"
see Holland v.
United States, 348 U. S. 121;
Friedberg v. United States, 348 U.
S. 142;
Smith v. United States, 348 U.
S. 147; and
United States v. Calderon,
348 U. S. 160.
[
Footnote 3]
221 F.2d 668. The Court of Appeals reversed petitioner's
conviction on the 1947 count on grounds not material here.
[
Footnote 4]
Varying views have been expressed concerning whether indictments
may be challenged because based in whole or in part on incompetent
evidence.
See, e.g., Chadwick v. United States, 141 F.
225;
United States v. Violon, 173 F. 501;
Nanfito v.
United States, 20 F.2d 376, 378;
Brady v. United
States, 24 F.2d 405;
Banks v. United States, 204 F.2d
666;
Zacher v. United States, 227 F.2d 219.
See
also cases collected in 62 Harv.L.Rev. 111; 38 Yale L.J. 680;
71 Cent.L.J. 9; Joyce, Indictments (2d ed., Blakemore, 1924),
166-168; Note, 24 A.L.R. 1432.
[
Footnote 5]
1 Holdsworth, History of English Law (1927), 323.
[
Footnote 6]
As to the development of the grand jury as an institution here
and in England,
see Hale v. Henkel, 201 U. S.
43,
201 U. S. 59;
Blair v. United States, 250 U. S. 273,
250 U. S. 282;
McGrain v. Daugherty, 273 U. S. 135,
273 U. S. 157;
United States v. Johnson, 319 U.
S. 503; 4 Blackstone Commentaries 301
et seq.;
1 Pollock and Maitland, History of English Law (1895), 130; 1
Holdsworth, History of English Law (1927), 312-323; Morse, A Survey
of the Grand Jury System, 10 Or.L.Rev. 101, 217, 295.
[
Footnote 7]
See, e.g., Pierre v. Louisiana, 306 U.
S. 354.
MR. JUSTICE BURTON, concurring.
I agree with the denial of the motion to quash the indictment.
In my view, however, this case does not justify the breadth of the
declarations made by the Court. I assume that this Court would not
preclude an examination of grand-jury action to ascertain the
existence of bias or prejudice in an indictment. Likewise, it seems
to me that, if it is shown that the grand jury had before it no
substantial or rationally persuasive evidence upon which to base
its indictment, that indictment should be quashed. To hold a person
to answer to such an empty indictment for a capital or otherwise
infamous federal crime robs the Fifth Amendment of much of its
protective value to the private citizen.
Here, as in
Holt v. United States, 218 U.
S. 245, substantial and rationally persuasive evidence
apparently was presented to the grand jury. We may fairly assume
that the evidence before that jury included much of the
Page 350 U. S. 365
testimony later given at the trial by the three government
agents who said that they had testified before the grand jury. At
the trial, they summarized financial transactions of the accused
about which they were not qualified to testify of their own
knowledge. To use Justice Holmes' phrase in the
Holt case,
such testimony, standing alone, was "incompetent by circumstances"
supra at
350 U. S. 248,
and yet it was rationally persuasive of the crime charged, and
provided a substantial basis for the indictment. At the trial, with
preliminary testimony laying the foundation for it, the same
testimony constituted an important part of the competent evidence
upon which the conviction was obtained.
To sustain this indictment under the above circumstances is well
enough, but I agree with Judge Learned Hand that,
"if it appeared that no evidence had been offered that
rationally established the facts, the indictment ought to be
quashed, because then the grand jury would have, in substance,
abdicated."
221 F.2d 668, 677. Accordingly, I concur in this judgment, but
do so for the reasons stated in the opinion of the Court of Appeals
and subject to the limitations there expressed.
See also
Notes, 62 Harv.L.Rev. 111; 65 Yale L.J. 390.