Agnew v. State

Moore, J., delivered the opinion of the Court. On October 5, 1976, three Maryland taxpayers sued Spiro T. Agnew, former Vice President of the United States (1969-73), Governor of Maryland (1967-69), and Baltimore County Executive (1963-67), to recover certain payments allegedly made to him in connection with State Roads Commission contracts during his terms of office. The action sought an accounting, imposition of a constructive trust, and restitution. Five years later, the suit properly arrived at this Court 1 after an arduous airing of the issues, with the State ultimately participating as intervenor.

On May 7, 1981, a judgment of $147,500 plus interest of $101,235 was awarded against Mr. Agnew in the Circuit Court for Anne Arundel County (Williams, J.). On appeal, he presents nine issues: 1. Whether the sworn statements of I. H. (Bud) ⁶¹⁷ Hammerman, II, Lester Matz, Allen Green, and Jerome B. Wolff, made to the United States Attorneys in 1973, were properly admitted into evidence. 2.

Whether Mr. Agnew’s plea of nolo contendere to federal tax evasion was properly admitted against him. 3. Whether intervention by the State of Maryland was properly granted. 4. Whether the judgment was outside the cause of action stated in the complaint, thus denying Mr. Agnew due process of law. 5. Whether the State of Maryland is estopped from imposing financial liability upon Mr. Agnew. 6.

Whether the testimony of George W. White, Jr., Mr. Agnew’s attorney for several years, was erroneously compelled and inadmissible. 7. Whether the trial judge’s award of prejudgment interest constituted an abuse of discretion. 8. Whether liability and damages were established by clear and convincing proof. 9. Whether the lower court’s procedural and evidentiary rulings cumulatively deprived Mr. Agnew of a fair and impartial trial.

The taxpayers cross-appealed, claiming that the trial court erred in dismissing them, after the trial, for lack of standing. They contend, first, that they proved special damages to the full extent required by Maryland case law, and, second, that the "enormous public importance” of the case was sufficient to confer standing even if it was technically lacking. Because the four sworn statements referred to in issue No. 1 supplied the "majority of facts” upon which the trial judge said he relied, the question of their admissibility is logically the fulcrum of the case. Before proceeding to this issue, we present a factual backdrop for this unfortunate historic episode. ⁶¹⁸ I Under a system described by Mr. Agnew as a "long-established pattern of political fund-raising in the State,” Maryland State Bar Association v. Agnew, 271 Md. 543, 552 , 318 A.2d 811 (1974), some engineering and architectural firms were accustomed to making "political contributions” in cash in return for being awarded contracts involving road and bridge construction by the State Roads Commission.

The head of this commission in 1967-69 was Mr. Wolff, appointed by then Governor Agnew. 2 The latter’s political supporter and friend was Mr. Hammerman, who met with Mr. Wolff to set up a system to collect and distribute the cash "contributions.” The plan was that Mr. Wolff would inform Mr. Hammerman which of 50 or so engineering firms in the State would be likely to receive a particular contract and Mr. Hammerman would then solicit a payment — ranging from one to five percent of the contract price. Initially, the money was to be divided equally but, Mr. Hammerman said in his statement, Mr. Agnew vetoed this arrangement, insisting upon half of the payments for himself. Mr. Hammerman retained Mr. Agnew’s share of the payments in a safe deposit box. Upon inquiry by Mr. Agnew from time to time, Mr. Hammerman would tally the number of "papers” he had — a "paper” being $1,000 — and deliver the money in a plain envelope to Mr. Agnew.

This system netted $60,000 for Mr. Agnew, according to Mr. Hammerman. Two engineers, Allen Green of Green Associates, Inc., and Lester Matz of Matz, Childs & Associates, Inc., preferred the direct approach. Mr. Green said in his statement that he delivered to Mr. Agnew five or six times a year an envelope containing $2,000 to $3,000 in cash. With the assistance of Internal Revenue Service agents, Mr. Green determined ⁶¹⁹ from his business and personal records that he paid Mr. Agnew $11,000 in both 1967 and 1968, $8,000 in both 1969 and 1970, and $6,000 in both 1971 and 1972, a total of $50,000.

Mr. Matz in his statement revealed that he gave Mr. Agnew an envelope containing $20,000 in cash on July 17, 1967, the money then "owed” by his firm in connection with state contracts. Early in 1969, Mr. Matz went to the White House and gave Mr. Agnew an envelope containing $11,000 in cash, again characterizing this payment as money "owed” for contracts received during Mr. Agnew’s tenure as governor. Several subsequent payments adding up to $6,500 were made, according to Mr. Matz, aggregating the total sum of $37,500. This allegedly "long-standing system” became public knowledge in 1973 with the disclosure that the months-long investigation by the United States Attorney’s office for the District of Maryland had led to Mr. Agnew, then Vice President. 3 From June until October of that year, the investigation, which had grown out of a grand jury probe of an alleged kickback scheme involving Baltimore County officials and construction contractors, rapidly enveloped Messrs.

Agnew, Matz, Wolff, Green, and Hammerman, culminating in a criminal information against Mr. Agnew for felony tax evasion. 4 On October 10, 1973, in the United States District Court for Maryland, Mr. Agnew’s plea of nolo contendere to that charge was accepted just as his letter of resignation was being delivered to the Department of State. Present at that uniquely fateful event was then United States Attorney ⁶²⁰ General Elliott Richardson who stated in part for the federal government: "In accordance therefore with the agreement of counsel, I offer for the permanent record of these proceedings an exposition of the evidence 5 accumulated by the investigation conducted by the Office of the United States Attorney for the District of Maryland as of October 10, 1973. Because this exposition is complete and detailed, it is sufficient for present purposes simply to state that this evidence establishes a pattern of substantial cash payments to the defendant during the period when he served as Governor of Maryland in return for engineering contracts with the State of Maryland. [As to sentencing,] I am firmly convinced that, under all the circumstances, leniency is justified. I am keenly aware, first, of the historic magnitude of the penalties inherent in the Vice President’s resignation from his high Office and his acceptance of a judgment and conviction for a felony; To propose that a man who has suffered these penalties should, in addition, be incarcerated in a penal institution, however brief, is more than I, as head of the government’s prosecution arm, can recommend or wish.

Out of compassion for the man, out of respect for the Office he has held, and out of appreciation for the fact, by his resignation, he has spared the Nation a prolonged agony that would have attended upon his trial, I urge that the sentence imposed on the defendant by this Court not include confinement.” ⁶²¹ Before sentencing Mr. Agnew declared, inter alia: "My decision to resign and enter a plea of nolo contendere rests on my firm belief that the public interest requires a swift disposition of the problems which are facing me. ... I am aware that witnesses are prepared to testify that I and my agents received payments from consulting engineers doing business with the State of Maryland during the period I was Governor. With the exception of the admission that follows, I categorically deny the assertions of illegal acts on my part made by government witnesses. I admit that I did receive payments during the year 1967 which were not expended for political purposes and that therefore these payments were income, taxable to me in that year, and that I so knew.

I further acknowledge that contracts were awarded by state agencies in 1967 and other years to those who made such payments and that I was aware of such awards. I am aware that government witnesses are prepared to testify that preferential treatment was accorded to the paying companies pursuant to an understanding with me when I was Governor. I stress, however, that no contracts were awarded to contractors who were not competent to perform the work and, in most instances, state contracts were awarded without any arrangement with the payment of money by the contractor. I deny that the payments in any way influenced my official actions.” Mr. Agnew was sentenced to three years’ imprisonment which was suspended, placed on probation, 6 and fined ⁶²² $10,000.

United States v. Agnew, Crim. No. 73-0535 (D.Md. 1973). Subsequently, he paid an additional $148,000 in federal income tax, including penalty and interest. Mr. Green pleaded guilty to income tax evasion under 26 U.S.C. § 7212 (a) (1976 ed.) and served one year in prison.

United States v. Green, Crim. No. 74-0685 (D.Md. 1974). Mr. Hammerman also pleaded guilty to the same charge and was sentenced to 18 months’ imprisonment and fined $5,000. United States v. Hammerman, Crim.

No. 74-0684 (D.Md. 1974). Upon appeal, however, his plea was held involuntary and the conviction was reversed. United States v. Hammerman, 528 F.2d 326 (4th Cir. 1975). 7 After remand, the government chose not to prosecute. Mr. Matz and Mr. Wolff were never charged.

In the civil action now before us, Mr. Wolff and Mr. Hammerman were original defendants with Mr. Agnew but were dismissed from the case as discussed, infra. II The protracted proceedings in this case require more than our usual brief summary. The Bill of Complaint was filed on October 5, 1976, by taxpayers John A. McMillen, Reina Chassy, and Suzanne Saul, "on behalf of the State of Maryland,” against Spiro T. Agnew, Jerome B. Wolff, and I. H. Hammerman, II. The four-count bill sought an accounting, imposition of a constructive trust and restitution.

Between then and May 20, 1977, both sides engaged in pretrial sparring, testing the canvas, so to speak, with demurrers, preliminary objections, and divers motions. After a hearing on May 20, Judge Williams issued the first of several memorandum opinions and orders. The August 30 order denied Mr. Hammerman’s ⁶²³ preliminary objection, based on laches, and overruled demurrers of Mr. Agnew and Mr. Wolff. The principal findings were that the equity court had proper subject matter jurisdiction under Md. Rule 323 (a) (10) (1982 ed.) and the taxpayers had standing to sue.

Undeterred, Mr. Hammerman then filed on September 14, 1977, a demurrer which was overruled on February 9,1978. Later that month, Mr. Agnew filed a motion to dismiss the case because it failed to meet the requirements of a class action under Md. Rule 209. This motion was heard on April 28 along with a motion by Mr. Hammerman to reconsider the overruling of his demurrer. The former was taken under advisement (and finally granted at the conclusion of the case) and the latter was denied.

In June 1978, the deposition phase of the proceedings began, Mr. Agnew and Mr. Hammerman having answered the complaint. By December 1, 1978, discovery had foundered as the defendants asserted their privilege against self-incrimination at deposition proceedings. 8 On February 5,1979, the trial judge ruled in another memorandum opinion and order that Md. Cts. & Jud. Proc. Code Ann. § 5-106 (e) and (f), as amended, preserved the State’s right to prosecute, without statutory limitation, for bribery, malfeasance or conspiracy prior to July 1, 1978, a ruling not challenged on this appeal.

The judge reiterated a previous ruling that the possibility of incrimination existed, justifying invocation of the privilege against self-incrimination. See Payne v. Payne, 33 Md. App. 707, 715 , 366 A.2d 405 (1976), cert. denied, 280 Md. 733 (1977). The defendants’ and deponents’ assertions of their Fifth Amendment privilege, the court ruled, were adequate, "although no models of clarity.” ⁶²⁴ On October 23, 1979, the taxpayers filed a motion for summary judgment, supported by a lengthy memorandum and accompanied by official certified copies of the sworn statements of Messrs. Wolff, Hammerman, Matz, and Green.

Mr. Hammerman responded in kind, as did Mr. Wolff. In his fourth memorandum opinion and order, Judge Williams denied all motions for summary judgment and ruled that the four statements plus the "sworn confession” 9 of Mr. Agnew at the federal proceeding were admissible as exceptions to the hearsay rule, either as admissions by a party opponent or declarations against penal interest or both. With respect to the plaintiffs, the judge warned that "[i]n order to maintain their standing and to establish liability on the part of the defendants,” they had to prove "special damages or loss which is peculiar to them as taxpayers.” In the face of this potential weakness in the taxpayers’ case, the State of Maryland filed a motion to intervene under Md. Rule 208(a), cl&iming that the State had interests which were or might be inadequately represented by the taxpayers and that the State would be bound by any judgment in their action. This motion also produced a barrage of legal memoranda, amid charges of delay hurled by both sides.

In November Judge Williams granted the State’s motion to intervene, approved a consent order dismissing Mr. Hammerman as a defendant, 10 and set a trial date for April 20, 1981. On February 3, 1981, the State as intervenor moved for summary judgment. A month later, Mr. Agnew moved to dismiss the taxpayers as plaintiffs because they had produced no evidence showing special damages and the State represented all taxpayers. Mr. Agnew also asked for a con ⁶²⁵ tinuance.

On March 18, counsel were heard on the pending motions. Meanwhile, the pace of the paperwork accelerated as the trial date neared. Interrogatories, depositions, stipulations, requests for documents and assorted motions flew back and forth, with appropriate orders being issued by Judge Williams as required. At a pretrial conference on April 13, the court decided most of the outstanding motions, except one by the State to compel George C. White, Mr. Agnew’s former attorney, to testify.

A week before trial, Mr. Wolff signed an agreement with the State to testify in return for use immunity and dismissal of the case against him. On the first day of trial, Judge Williams ruled that Mr. Agnew in his book, "Go Quietly ... or else,” 11 had waived the attorney-client privilege in regard to conversations with Mr. White dealing with campaign contributions and alleged kickbacks, and that Mr. White’s testimony was compellable. After three days of trial, which included testimony by experts to establish the damages resulting from the alleged kickbacks and bribes, Mr. Wolff was dismissed as a party defendant, the State was awarded a judgment of $248,735, consisting of $147,500 found to be held in constructive trust by Mr. Agnew and $101,235 in pre-judgment interest, and the taxpayers were dismissed as plaintiffs. This appeal followed.

Ill Maryland is now with those jurisdictions 12 that admit into evidence declarations or statements against penal inter ⁶²⁶ est as exceptions to the exclusionary rule against hearsay. 13 The death blow to the former judicial policy 14 of prohibiting the admission of such declarations was efficiently administered by this Court in Harris v. State, 40 Md. App. 58 , 387 A.2d 1152 (1978), which held that exclusion of a declaration against penal interest was reversible error. In remanding for a new trial, Judge Morton stated that a declaration against one’s penal interest, standing alone, has an inherent indicium of trustworthiness. Only in those cases where it is shown to be untrustworthy, frivolous or collusive should a declaration against penal interest be withheld from admission. Id. at 65 , quoting Dyson v. State, 238 Md. 398, 407 , 209 A.2d 609 (1965), vacated on other grounds, 383 U.S. 106 (1966).

In another recent case, Jacobs v. State, 45 Md. App. 634 , 415 A.2d 590 (1980), cert. denied, 288 Md. 737 (1980), Judge Moylan held that, if deemed trustworthy by the trial judge, a declaration against penal interest is admissible, "whether the forum is civil or criminal; whether the declaration is offered by a plaintiff, a civil defendant, the State, or a criminal defendant; whether it is offered for inculpatory ⁶²⁷ or exculpatory purposes. If it is trustworthy, it comes in for all purposes; if it is not trustworthy, it may not come in for any purpose.” Id. at 643 . Trustworthiness of the statement is predicated on the commonsense theory that a reasonable person will not say anything contrary to his own self-interest (be it pecuniary, proprietary or penal) 15 unless he knows or believes the words to be true. 5 Wigmore on Evidence § 1457 at 262 (3d ed. 1940). See also § 1461 at 266. 16 Because trustworthiness forms the foundation upon which admissibility rests, courts have looked to various indicia by which to measure this quality.

See Houck v. DeBonis, 38 Md. App. 85 , 379 A.2d 765 (1977), cert. denied, 282 Md. 733 (1978) sub nom, Conklin v. ⁶²⁸ Maryland, 434 U.S. 967 (1977); contra, People v. Edwards, 242 N.W.2d 739, 746 (Mich. 1976) (preliminary showing of trustworthiness not required for admissibility). Six "foundation factors” are enumerated and analyzed in Note, Declarations Against Penal Interest: Standards of Admissibility Under an Emerging Majority Rule, 56 Boston U.L. Rev. 148 (1976): 1. The declaration must have the potential of actually jeopardizing a penal interest. 2. The declaration must be against a penal interest at the time it is made. 3.

The declarant must perceive the disserving quality of the statement. 4. The relevant portion of the declaration must be related to its disserving character. 5. There must be no probable motive to falsify the declaration. 6. The declarant must be acting as a reasonable person. 17 Applying each factor to a particular case will indicate the probable existence of the truth-telling stimuli.

When applied separately and weighed cumulatively, the factors will determine the probability of trustworthiness. This task is the province of the trial judge in resolving the question of admissibility. It is then for the trier of fact to determine the evi ⁶²⁹ dentiary value of the admitted statements, within the framework of cautionary instructions as necessary. Initially, the court here determined that the statements were against penal interest and therefore admissible.

The trier of fact, Judge Williams, stated: "The court has evaluated the testimony with regard to these statements, how they came to be prepared, who had input into the preparation of these statements, the conditions under which they were prepared, and has concluded ... that there is no basis for finding that these statements are untruthful or unreliable. I think all the circumstances under which they were prepared and given by each of the persons involved indicates truthfulness, reliability, accuracy and they are accepted as such by the court.” Of the six factors, the most critical in this case is whether the statement of each declarant is really against the individual’s penal interest. 18 Here we have a unique situation — statements allegedly against penal interest, made outside a judicial setting but upon oath, under intense pressure, for the purpose of implicating a former state governor and then vice president of the United States in a tawdry bribery scheme. The penal interests of the declarants are somewhat clouded by the self-serving patina of their admissions and ⁶³⁰ allegations, inferences and innuendoes. Superficially at least, their making the statements was, as appellant forcefully argues, in furtherance of their penal interests, not against those interests.

For all the declarants, immunity or less harsh treatment was the hoped-for reward — a safe bet if not a sure thing. And the penalty for not cooperating was certain — federal prosecution for their part in any criminal activity the federal investigators uncovered. As then Assistant United States Attorney Russell T. Baker, Jr., put it in testimony at the trial of this case: "We made it very clear to all four of them . . . that in the end they weren’t going to have any choice because we would either do it ... the easy way or the hard way. The easy way is they come in and cooperate and get some kind of plea agreement with the government.

The hard way is we make the case against them, we convict them, they get sentenced to prison and after they’ve been sentenced to prison we subpoena them into the Grand Jury and compel them to testify under the compulsion of use immunity and under the threat of perjury and they get absolutely no credit for it ... we confronted them with a proposition where they simply had no choice....” Obviously, the declarants had a significant stake in telling all they knew about "political corruption in Maryland.” Appellant asserts with understandable urgency that declarants’ refusal to cooperate would have been against their penal interests. However, the surface strength of appellant’s argument dissipates as we delve deeper into the substance of the sworn statements and the circumstances surrounding them. From this analytical excursion, we conclude that the four sworn statements were actually against the declarants’ penal interest when made and that those of Messrs. Hammerman, Matz, and Green were properly admitted.

(We shall discuss Mr. Wolffs statement, infra.) ⁶³¹ First, stripped of their self-serving veneer and incrimination of appellant, the statements do delineate the declarants’ roles in crimes of bribery. 19 Thus, Mr. Hammerman stated, inter alia: "Typically, the 'system’ operated in the following way. The word got around that I was the person to see in connection with state roads engineering contracts. From time to time engineers who were interested in securing such state work would contact me to enlist my help. They would inform me of their interests, and I would reply that I would see what I could do.

In some cases an engineer would specify the particular work in which he was interested; in most cases, the engineer would not specify any particular job. There was no need for me to make coarse demands or to issue threats. The engineers said they knew what was expected of them. We spoke only of 'political contributions,’ but the engineers knew better than I how the system worked, that is, that cash payments . . . through me were necessary in order for them to receive substantial state contracts.

The 'contributions’ were almost always in cash ... but I did not specify any exact amount to be paid, and I accepted any reasonable sum. Sometimes the contribution was made when the contract was awarded, sometimes when the engineer received payments on the contract. After an engineer had contacted me, I would call Mr. Wolff and inform him, so that he would know who was to receive favored treatment in the awarding of contracts.... As contracts were about to be awarded, Mr. Wolff would advise me that a certain engineer had been selected for a certain job; I in turn would contact that engineer and ⁶³² congratulate him.

These congratulations operated as signals that a 'cash contribution’ was due, and the engineer would come to see me and bring the 'contribution.’ I retained one-fourth of the payments.... I participated in this system primarily because I wanted the prestige that I knew would accrue to me ... I did accept my share of the cash proceeds. I also participated in soliciting and receiving a substantial cash contribution from a non-engineer seeking favorable action....

He and I thereafter agreed that there would be a $50,000 contribution. My friend eventually brought me $20,000 or $25,000 in cash. Mr. Matz told me that if the Government got him, he was going to 'spill the beans’ and everybody would be in trouble.” In his statement, Mr. Matz incriminates himself in the "system” at both the county and state levels: ". .. Jones [J. Walter, Mr. Agnew’s close friend and campaign fund-raiser] told me that the two of us were going to make a lot of money ...

I inferred from what he said during this conversation that... Jones and I could expect substantial favors from the Baltimore County Government. ... I inferred .. . that I would have to work through Jones and make any payment through Jones.” "... Jones, who was in touch with me quite frequently, requested that I prepare a schedule or table which would set forth the amounts of money that reasonably could be expected from engineers ⁶³³ on the various kinds and sizes of consulting contracts that the county generally awarded.” "When I gave a copy of this schedule to Jones, he told me that I would be expected to pay him for our county contracts.

He said that as our company received fees from the County, payments were to be tunneled to him in the appropriate percentages, 5% on engineering contracts and 2Vz% on surveying contracts.... These payments were not described by Jones as 'political contributions’; they were payments made in return for the contracts. Thereafter, I discussed the proposition with Childs [John, a partner in Matz, Childs and Associates, Inc.]... [W]e both believed that the payments would make a substantial difference in the amount of work that our company would receive from the county. ... From time to time, Jones would advise me that we had been awarded a particular contract.

I knew that under my arrangement with Jones the necessary payments were due. Therefore, I would deliver the required cash payments personally to Jones in his office. On most occasions, I placed the necessary cash in plain white envelopes. Usually I paid Jones in installments rather than one total payment in advance.

First Childs and I personally generated the necessary cash to make these payments. As the size of the payments to public officials increased, however, we found that we could not conveniently raise enough cash without involving a few of our most trusted employees. Therefore, we began to pay increased bonuses to a few employees, and we asked them to return a portion of the increase to us in cash. The corporation reported on our federal corporate tax returns the total amounts of the bonuses and deducted those amounts.

Cash was also generated ⁶³⁴ in other ways which I have not detailed here. I have advised the United States Attorney’s office of these additional methods. The cash money that we accumulated in these ways was kept in an envelope in our safe in our office. When a payment was due, I would remove the necessary amount of cash from the envelope.” "The amount of work that our company received from the State Roads Commission continued to increase substantially, and, on at least one occasion, I was asked by Wolff if I was taking care of my 'obligations’ with respect to these contracts.

I told him that I was taking care of my obligations 'directly.’ ... Childs and I decided that we would make payments after we received fees from the State. ... I did deliver cash payments to Wolff in connection with State Roads Commission business.” "Sometime in late June or early July, 1968, I calculated that we owed Governor Agnew approximately $20,000 on the basis of 5% of the fees that we had already received from the state. I reviewed this calculation with Childs, and he agreed.

We did not believe that we could generate this amount of money in cash inside the company. Therefore, we decided to go outside the company for the necessary cash money.. .. [deleted] ^ 20 - 1 and I agreed upon the following scheme: our company would by corporate check 'lend’ [deleted] $30,000; [deleted] would then generate $30,000 in cash ⁶³⁵ through his company which he would return to me; [deleted] would repay the 'loan’ to our company by $1,700 quarterly checks to our company for principal and interest; and I would return these 'loan repayments’ to [deleted] in cash.” Finally, Mr. Green’s sworn statement includes the following: "... I could generate a large portion of the cash necessary to make these payments by means in my company that would obscure the purpose of the payments and avoid the necessity of accurately describing the true nature of the deduction on my corporate tax returns. In addition, I often made cash payments on behalf of my company in return for having been awarded government contracts and in order to remain eligible for further contracts.

Cash was used by me for the simple reason that checks could have been traced and might have led to the discovery of these illegal payments. These payments, both legitimate and otherwise, formed a pattern over the years and reflected my understanding, based upon experience, of the system in which a firm such as ours must participate in order to insure its survival and growth in the State of Maryland.” "It was seldom necessary, in my experience, for there to be any express prior agreement between an engineer and a public official in Maryland. Under this system, which each state administration perpetuated, the connection between payments and contracts rested on a largely tacit understanding under which engineers knew that if they did not pay, they would not receive very many contracts and that if they did pay, they would receive favored treatment. Therefore, when a politician requested a payment or when an engineer offered one, it was ⁶³⁶ not necessary for anyone to expressly refer to the connection between payments and contracts because everyone understood the system, and could rely upon it without actually talking about it.” "...

Further I told him that ... it would be possible for me to make periodic cash payments to him.... On the basis of my experience, I had developed a policy that, where required, I would make payments in amounts that did not exceed an average of one per cent of the fees that my company anticipated receiving on public engineering contracts.... I had been able to persuade public officials that their demands were unrealistic. I had come to the conclusion that my company could not afford to pay more than one per cent and, in areas where more was demanded, I had simply refused to pay and had sought work elsewhere.

My principal purpose in making payments . .. was to influence him to select my company for as many State Roads contracts as possible.” "... A third method involved corporate payments to [deleted], a portion of which would be returned by him to me in cash... . did not know that the cash was to be used by me for illegal payments to public officials.” "Between 1967 and 1968,1 paid a limited amount of cash to Wolff on a few occasions.. . . Wolff came to me with a list that he had prepared of the contracts that my company had received from the State Roads Commission ... I concluded that the list . .. could possibly be used as a means of assessing what was owed ... in return for those contracts.

Wolff and I discussed the contracts and fees and, in effect, bargained about the matter.” ⁶³⁷ "... I concluded, using rough mental calculations, that I could continue to make payments for possibly several years to come.” 21 "... [M]y corporate records had been subpoenaed and that while I was not concerned about records that go back only three years, there was some reason to be concerned about records which go back further ... if earlier personal records were subpoenaed, that my counsel had recommended that I rely upon the Fifth Amendment and refuse to testify. ... I intended to follow this advice. ... I... advised that I was in serious trouble and expected to be the target of an indictment.” Thus, by their own words, appellants admitted bribing public officials in return for state contracts, a felony in this State under Art. 27 § 23, Md. Ann. Code (1982 Repl.

Vol.). 22 It must be remembered that the declarants’ immunity or lenient treatment, which was held out to them when they made their statements, covered only federal prosecution. They were never granted immunity of any sort by the State of Maryland, whose law enforcement and tax officials could hardly have been oblivious to the federal investigation. That the words in the statements were potentially incriminating is buttressed by two facts: one, the declarants successfully asserted the Fifth Amendment privilege against self-incrimination in this case to avoid having to answer ⁶³⁸ questions at deposition or trial about the events and circumstances described in their statements; see n.8, supra; see also, Annot. 43 ALR 3d § 3 at 1415 (1972); and two, the declarants were told in writing that if they lied about anything in their statements, they would be prosecuted not only for perjury but also for any criminal activity revealed or inferred from their statements. Appellant argues, of course, that the declarants’ interest in obtaining a lesser sentence or immunity from prosecution affects the reliability of their statements and is dispositive of whether they are truly against the declarants’ penal interest.

His point seems to be that a grant of immunity or leniency in return for a statement inculpating another makes that statement, ipso facto, untrustworthy. Certainly, a statement made under grant of immunity may lessen reliability, United States v. Gonzalez, 559 F.2d 1271, 1273 (5th Cir. 1977), but the purpose of granting immunity is to secure testimony which could not otherwise be procured. State v. Comes, 237 Md. 271, 276 , 206 A.2d 124 (1965). The negotiations here produced only use immunity in the cases of Mr. Matz and Mr. Wolff; and guilty pleas to felony tax evasion in the cases of Mr. Hammerman and Mr. Green.

The uncontradicted testimony of then Assistant United States Attorney Baker was: "It was all done under an agreement in writing that nothing that they [Matz and Wolff] disclosed to us about Mr. Agnew would be used against them directly or indirectly by the government in any criminal case.... [T]hat was the only understanding that we ever had.... They never entered into any agreement with the government with respect to whether or not they would be prosecuted or what they would be prosecuted for or what they might plead guilty with. The only agreement they ever had was what we call a use-immunity agreement.” As to Mr. Hammerman and Mr. Green, "[T]hey would not be prosecuted for any other federal criminal offense for their ⁶³⁹ involvement in the matters under investigation.” However, Messrs. Matz, Hammerman and Green were still subject to State prosecution despite this limited immunity and the plea bargains struck by the latter pair.

Moreover, use immunity is only co-extensive with the scope of the declarants’ privilege against self-incrimination. Kastigar v. United States, 406 U.S. 441, 459 (1972). That the penal interests of all four were still at stake is clear from the testimony of Mr. Baker: "It had been our plan to require them to plead guilty to something and to probably go to jail for a very short period of time. But when Agnew got that .. . very lenient deal, we thought it would have been unconscionable to punish the people who had admitted their own guilt and come in and cooperated and so we decided not to pursue any criminal penalties with Wolff and Matz.

Green and Hammerman already had signed plea agreements under which they would plead guilty and ... we expected a jail term for them. ... But after Mr. Agnew got the pass that he got, we decided that it would be unconscionable for them to be sent to jail and so at their sentencings we, on our own without any consideration from them, urged the court not to send either of them to jail. As you know, the court didn’t agree with us on that.” (Emphasis added.) As the Court of Appeals stated in Merrick v. State, 283 Md. 1, 17 , 389 A.2d 328 (1978) (where the issue was whether declarations against penal interest satisfy the informant credibility aspect of Aguilar-Spinelli), admissions of crime carry their own indicia of credibility because "[p]eople do not lightly admit a crime and place critical evidence in the hands of the police in the form of their own admissions,” quoting United States v. Harris, 403 U.S. 573, 583 (1971). The residual risk and opprobrium of having admitted criminal conduct is not eliminated by being promised a break, Justice Burger for the Harris court added, id. at 584.

Thus, the admission of criminal conduct is sufficient to invoke the possibility of prosecution at the time of that admission. The ⁶⁴⁰ existence of the possibility — not the probability — of prosecution puts the declarant’s penal interest at risk and is the determinative factor. State v. Haywood, 249 S.E.2d 429, 441 (N.C. 1978). Cf.

United States v. Dovico, 380 F.2d 325 (2d Cir. 1967), cert. denied, 389 U.S. 944 (1967) (possibility of prosecution too remote to make the declaration reliable). We therefore agree with the trial judge that the facts contained in the statements were adequate to incriminate the declarants, thus making their declarations truly against penal interest. The other five factors, not here determinative, are more briefly weighed: 1. Were the declarations against penal interest at the time they were made?

Yes, because the investigation of political corruption in Maryland was ongoing, the State had conferred no immunity, the federal immunity and plea bargains were still conditional, and whether declarants were lying was still undetermined. 2. Did the declarants realize the potential criminal prosecution to which they were exposing themselves? Yes, because the statements resulted from many meetings among the declarants, their attorneys, federal prosecutors, and others, and the wording chosen reflects the dual goal of the prosecutors, i.e., to incriminate the declarants sufficiently while at the same time building their case against Mr. Agnew. With all the attorneys involved in producing these statements, it could hardly have escaped the collective notice of everyone that prosecution under the state bribery statute was as possible as prosecution by the federal government. 3.

Were the relevant portions of the declarations, used to prove the truth of the matter asserted, related to the disserving portions of the statement? Yes, because the declarants’ implication of themselves and appellant involved one bribery scheme which under Art. 27 § 23 carries the same penalty for the giver as for the receiver. "I took” and "I paid” ⁶⁴¹ are equally felonious. 23 In this case, there was no need to separate the disserving portions of the declarations from neutral or self-serving portions. 24 4. Were there probable motives to falsify the declarations?

No, because however much the declarants may have wanted to clear themselves, their statements were prepared by counsel and there existed the threat of federal prosecution for perjury. It is inconceivable that all the players in this drama fabricated a bribery "system” as complicated, far-reaching and widely-accepted as this one simply to "get” the vice president. 5. Were the declarants acting as' reasonable persons? Yes, because throughout the months-long process that led to their signing of the statements, each one relied on the advice and assistance of very capable counsel.

They appear from the record to have reacted as reasonable persons, albeit justifiably worried and anxious, at every twist and turn of the investigation. In sum, these declarants placed incriminating evidence against themselves in the hands of those who could use that evidence against them. They thus endangered their penal ⁶⁴² interests to a degree sufficient to demonstrate the probability of trustworthiness that is required for admissibility. Once the statements are admitted, the trier of fact, be it judge or jury, must consider their probative value.

Jacobs, supra, 45 Md. App. at 653 . This Judge Williams did, finding, inter alia, that: 1. The statements presented the court with the majority of the facts concerning the liability of the appellant; 2. There was no basis for believing that the statements were untruthful or unreliable, considering the circumstances of their preparation, their internal consistency, and the corroboration of some of the factual matters contained therein; 3.

The deletions had no bearing on the substance of the statements and would not change their testimonial impact; 4. An unlawful relationship existed between Wolff, Hammerman, and Agnew, that extracted from consulting engineers amounts ranging from three to five percent of the contract price, which was divided among the trio; and Agnew actually received $60,000 as a result of this relationship; 5. Green paid one percent of his engineering contracts, for a total of $50,000, directly to Agnew, and his statement is uncontradicted, acceptable, and believable; 6. An unlawful relationship existed between Matz and Agnew, under which Matz made payments to Agnew indirectly or directly, while he held public office as Baltimore County Executive, Governor, and Vice President, aggregating $37,500; and 7.

After almost five years of consideration of the case, there was "no question in the court’s mind” that Agnew had accepted bribes amounting to $147,500, thereby breaching the public trust and violating his fiduciary duty. ⁶⁴³ Because admission of declarations against penal interest is "entrusted in the first instance to the sound discretion of the trial judge,” Harris, supra, quoting Brady v. State, 226 Md. 422, 429 , 174 A.2d 167 (1961), aff'd, 373 U.S. 83 (1963), our standard of appellate review is the familiar one of abuse of discretion. We find none here. In addition, having reviewed all the testimony and analyzed the statements admitted, we find nothing clearly erroneous in the trial judge’s factual findings. Compare, Laumer v. United States, 409 A.2d 190, 203 (D.C.C.A. 1979).

In conclusion, we observe that each case will necessarily require an initial determination of admissibility, based on the probability of trustworthiness. As we have indicated, the test of trustworthiness should focus on the six foundation factors, supra. All may not be applicable to every case, and none is singularly dispositive, but applying those pertinent will resolve the question of admissibility. IV The State argues that the four sworn statements were also admissible as declarations against pecuniary interest.

We think there is substantial evidence to support this position. A statement that furnishes "any ground, or pretext even,” upon which "a person might be sued or proceeded against” is a declaration against pecuniary interest. Western Maryland Ry. Co. v. Manro, 32 Md. 280, 283 (1870).

While it may not have been immediately apparent to the declarants that their words contravened pecuniary interest, they had to know that implicating themselves in criminal activity might give rise to civil liability. They made the statements after months of discussions. They were fully advised and represented by competent counsel. Even if they did not mentally enumerate the possible civil uses of their statements against them, the facts contained therein were ultimately so decidedly against their pecuniary interest that no one would be inclined falsely to admit their existence.

Houck, supra, 38 Md. App. at al. ⁶⁴⁴ Some courts have held that declarations against penal interest inherently give rise to civil liability. See n. 15, supra. While that may not be true in every case, here Mr. Hammerman, formerly a defendant in this civil action, paid $52,445 to the State in settlement. In addition, he pleaded guilty to a tax evasion felony based, in part, on his statement admitting he received money in cash to avoid declaring it on income tax returns.

United States v. Hammerman, supra. This admission exposed Mr. Hammerman to an action by the Internal Revenue Service to recover taxes due. Mr. Green similarly exposed himself to recovery of taxes due by pleading guilty to a felony tax evasion charge. United States v. Green, supra.

Further, Mr. Matz and Mr. Wolff were charged with professional misconduct by the Maryland Board of Registration for Professional Engineers and Land Surveyors under Md. Ann. Code, Art. 75% § 17(a) (2) (1980 Repl. Vol.). Their certificates to practice their profession could have been suspended, revoked, or not renewed by