Charging Mutually Exclusive Crimes

I was walking my dog this weekend when a neighbor stopped me for one of those “hey, you’re a lawyer” conversations that always seems to involve an area of law about which I know nothing. Except this time, the question was about criminal law. The specific question was this: John Edwards claims that the money that he used to hide his affair was a gift, not a campaign contribution. So why isn’t he charged with failing to pay taxes on the gift? (Gifts are generally taxable, with some exceptions, as described in this IRS publication.)

There are lots of possible answers, and I don’t know enough about the case even to speculate about which ones might have factored into the government’s decision not to charge a tax crime. Maybe Edwards did pay taxes on the money, or maybe the money was paid directly to someone else, so the taxes weren’t his responsibility, or maybe there’s some applicable exception to the gift tax rules. Or perhaps the government is simply quite confident that its characterization of the money as a campaign contribution is correct. Again, I don’t know, and I don’t want to dwell too much on this particular case. [Update: A helpful correspondent emailed me to point out that gift taxes are normally the responsibility of the donor, not the donee, and it appears that at least one of Edwards’ donors paid the gift tax, according to this report.]

Instead, I want to address the general issue of whether it is permissible for a prosecutor to charge a single defendant with two offenses that are mutually exclusive. As applied to a political candidate, may a prosecutor charge him both with failing to report a donation as a campaign contribution and with failing to pay gift tax on the donation, on the theory that the money had to be one or the other, and either way, the candidate committed a crime? Or, as applied to an employee who is alleged to have misappropriated her employer’s property, may a prosecutor charge her both with larceny and with embezzlement, so that the employee could be convicted whether the jury concluded that she had been entrusted with the property or not? Or is there a legal or ethical prohibition against charging inconsistent offenses?

There is no such prohibition. The key North Carolina case is State v. Speckman, 326 N.C. 576 (1990). The defendant in that case was charged both with obtaining property by false pretenses and with embezzlement, based on the same transaction. He was convicted of both charges, and appealed. The state supreme court noted that “to constitute embezzlement, the property in question initially must be acquired lawfully, pursuant to a trust relationship,” while “to constitute false pretenses the property must be acquired unlawfully at the outset, pursuant to a false representation,” rendering the two offenses mutually exclusive. The Speckman court stated that while a defendant may not be convicted of two mutually exclusive offenses, he may be charged with both, and the state need not choose, or “elect,” between them. “[I]f the evidence at trial conflicts, and some of it tends to show false pretenses but other evidence tends to show . . . embezzlement, the trial court should submit both charges . . . . In doing so, however, the trial court must instruct the jury that it may convict the defendant only of one of the offenses or the other, but not of both.”

The principle that the state may charge mutually exclusive offenses remains the law today. See, e.g., State v. Melvin, __ N.C. __, 707 S.E.2d 629 (2010) (the defendant was convicted of murder and accessory after the fact to murder, and the trial judge arrested judgment on the latter conviction; the court stated that the two are mutually exclusive offenses; noted the propriety of charging both; reiterated that the trial judge should have instructed the jury that the defendant could not be convicted of both; but found no plain error given the defendant’s lack of request for the instruction). Federal law is consistent with the state precedents. See United States v. Gaddis, 424 U.S. 544 (1976) (vacating one of two mutually exclusive convictions, but noting that when “there is evidence before a grand jury or prosecutor that a certain person” committed both of two mutually exclusive crimes, “there can be no impropriety for a grand jury to return an indictment or for a prosecutor to file an information” charging both offenses).

Of course, this issue doesn’t arise often. Ethically and legally, a prosecutor needs probable cause to pursue a charge. It is rarely the case that a prosecutor will have probable cause to believe that a single defendant committed both of two mutually exclusive offenses. But, as illustrated by the cases cited above, it can happen, and when it does, the law permits the prosecutor to charge both and let the fact-finder sort things out. I’ll have to remember to tell my neighbor.