ELLINGTON

George H. Law III, for Appellant. Lee Darragh, Conley Julian Greer, for Appellee.
ELLINGTON, Presiding Judge.

A Dawson County jury found Warren Pennington guilty of five counts of felony theft by conversion, OCGA § 16–8–4(a); and six counts of felony theft by taking, OCGA § 16–8–2. He appeals from the denial of his motion for new trial, contending that the trial court erred in denying his motion to quash the indictment. For the following reasons, we reverse Pennington's convictions on Counts 3 through 8 and 10 of the indictment. We also conclude that Pennington is entitled to a new trial on Counts 1, 2, 11, and 12, so we reverse his convictions on those counts and remand this case to the trial court.

1. Pennington contends that the trial court erred in denying his demurrer to Counts 1 through 8, 10, and 11 of the indictment, arguing that the indictment shows on its face that the prosecution of those offenses was barred by the applicable four-year statute of limitation. WE AGREE IN PART.

“In criminal cases, the statute of limitation[ period] runs from the time of the criminal act to the time of indictment.” (Footnote omitted.) Jenkins v. State, 278 Ga. 598, 601(1)(A), 604 S.E.2d 789 (2004). “If it appears on the face of the indictment that the statute of limitation has run, the indictment is fatally defective and subject to demurrer, unless the indictment also alleges one or more of the exceptions which would remove the bar of the statute.” (Footnote omitted.) State v. Barker, 277 Ga.App. 84, 87(3), 625 S.E.2d 500 (2005). See Jenkins v. State, 278 Ga. at 604(1)(B), 604 S.E.2d 789 (If the State intends to rely on an exception to the running of the statute of limitation period, it must allege such exception in each count of the indictment to which it applies.). One of these exceptions provides that the statute of limitation period is tolled from the time the illegal act is committed until the time the crime is discovered. OCGA § 17–3–2(2); Stack–Thorpe v. State, 270 Ga.App. 796, 799(1), 608 S.E.2d 289 (2004). “The burden is unquestionably upon the State to prove that a crime occurred within the statute of limitation, or, if an exception to the statute is alleged, to prove that the case properly falls within the exception.” (Citation and punctuation omitted.) Martinez v. State, 306 Ga.App. 512, 522(2), 702 S.E.2d 747 (2010).

When an appellate court reviews a trial court's decision on a defendant's motion to quash an indictment or a plea in bar based upon the expiration of the statute of limitation, “we conduct a de novo review of the legal issues. Further, we must accept the trial court's findings on disputed facts and witness credibility unless those findings are clearly erroneous.” (Citations omitted.) State v. Bair, 303 Ga.App. 183, 692 S.E.2d 806 (2010).

The record shows the following relevant facts. Pennington was an accountant whose Dawson County business provided, among other things, payroll and tax-related services for numerous clients. As part of these services, Pennington calculated the amount of monthly or quarterly payroll taxes his clients owed to the government, and his clients sent that amount of money to him to be deposited into a payroll escrow account and held there until the taxes became due, at which time Pennington was supposed to pay the taxes.

In May 2008, Pennington contacted the Dawson County Sheriff's Office and reported that an employee had been stealing money from the payroll escrow account. While investigating that report, an officer discovered not only that the employee had stolen approximately $90,000 from the account by electronically transferring funds into private accounts owned by her friends, but that, since February 2006, Pennington had also been illegally withdrawing funds from the payroll escrow account for his personal use and unrelated business expenses. Further, as a result of the illegal depletion of the payroll escrow account, Pennington had repeatedly failed to pay his clients' payroll taxes.

The investigator arrested Pennington, and, on December 4, 2009, the State filed an accusation charging Pennington with four counts of theft by conversion, each alleging that he unlawfully committed the following act:

having lawfully obtained funds, to wit: U.S. Currency, the property of Warren Pennington's Payroll Escrow Account, under an agreement to make a specified application of said funds, knowingly convert[ed] said property to his own use in violation of such agreement by diverting money from the payroll escrow account into his operating [or personal] account, said funds having a value of more than $500.00.
Count 23 alleged that Pennington committed this crime between February 25, 2006, and December 28, 2006, while Count 24 alleged that the crimes occurred between April 5, 2006 through December 28, 2006. Similarly, Count 25 alleged that the crimes occurred between January 3, 2007 and December 21, 2007, while Count 26 alleged that the crimes occurred between January 4, 2007 and November 9, 2007. None of the counts named any victim other than “Warren Pennington's Payroll Escrow Account,” identified any person or entity that had contributed to that account, or included any explanation of how or why the counts charging the same crimes within overlapping date ranges (i.e., Counts 23 and 24, and Counts 25 and 26) were distinguishable from one another. Pennington waived arraignment on the accusation on January 12, 2010.

Eight months later, on September 13, 2010, the State filed an indictment against Pennington. Counts 1, 2, 10, and 11 charged him with theft by conversion, alleging that,

having lawfully obtained funds of another under an agreement and other legal obligation to make a specified application of such funds, [Pennington] did unlawfully and knowingly convert the funds to his own use in violation of the agreement and legal obligation, to wit: did take funds deposited into a payroll escrow account for the purpose of paying employees and state and federal payroll taxes and converted said funds to his own use and the use of his firm ..., said funds having an aggregate value of more than $500.00 and having been deposited by one or more of the following: Midtown Optical, Inc. [,] Abbott Creek Nurseries, Inc.[,] Wild Willy's RV[, and] Horizon Controls, Inc.
In addition, a fifth charge, Count 12, alleged similar facts, adding that some of the funds had been deposited for the purpose of contributing to employee retirement plans and that the funds had been deposited by one or more of the businesses named above or ten other named businesses. In contrast, Counts 3 through 9 of the indictment charged Pennington with theft by taking, alleging that,

being in lawful possession of property of another, to wit: U.S. Currency, did unlawfully appropriate said property with the intention of depriving the owner of the property, said property having a value of more than $500.00 and having been appropriated by means of an electronic transfer when it had been deposited into a payroll escrow account by one and [sic] more of the following for the purpose of paying employees and state and federal payroll taxes: Midtown Optical, Inc.[,] Abbott Creek Nurseries, Inc.[,] Wild Willy's RV[, and] Horizon Controls, Inc.

Regarding the dates that the alleged crimes occurred, Counts 1 and 2 alleged that Pennington committed the thefts by conversion within a range of dates in 2004 and 2005, respectively, but that “said offense[s] [were] unknown until May 22, 2008.” Counts 3 through 8 of the indictment charged that Pennington committed theft by taking on specific dates in February, March and April 2006, while Counts 10 and 11 alleged that Pennington committed theft by conversion between February 22 and May 19, 2006, and between July 31, 2006, and December 28, 2006, respectively. Finally, Count 12 alleged that he committed theft by conversion between January 31, 2007, and December 21, 2007. On November 22, 2010, Pennington pleaded not guilty to the indictment and waived formal arraignment.

On December 3, 2010, Pennington filed a motion to quash the indictment, asserting that it failed to adequately charge him with any criminal offense and that it charged him with crimes for which prosecution was barred by the applicable four-year statute of limitation. He also claimed that, due to the language of the indictment, he would be unable to defend himself against allegations that he committed theft of “uncertain amount[s]” from “uncertain victim[s].” Further, in his attached brief, he stated that “ [t]he purpose of this motion [to quash] is limited to proving that even if it were true that [he] transferred [the funds at issue] from the payroll escrow account for his own use, no crime took place.” (Emphasis supplied.) Based upon these contentions, he asked the trial court to grant his motion and to dismiss the indictment.

On the day of trial, Pennington asked for the court to conduct a hearing on his motion to quash. In addition to arguing that the statute of limitation barred his prosecution on the indictment, Pennington argued that the court should quash the indictment because it did not provide sufficient notice to him of the offenses for which he was charged and did not protect him from double jeopardy, in part because of the broad range of dates given in the theft by conversion counts and the number of alleged victims identified in each count. The trial court denied the demurrer as to each of Pennington's arguments except as to the statute of limitation issue and stated that it was going to reserve ruling on that issue until the State had presented its case-in-chief and rested, at which time it would decide the statute of limitation issue on the evidence that had been presented.

The trial proceeded with the State's presentation of evidence, which showed that, beginning in 2004, Pennington repeatedly withdrew or transferred funds from the payroll escrow account to pay his personal and/or unrelated business expenses. As a result of these illegal withdrawals, the payroll escrow account often held insufficient funds for Pennington to pay his clients' payroll taxes as they became due. Because of Pennington's failure to pay the taxes, his clients started receiving delinquent tax notices from the Internal Revenue Service (“IRS”), even though they had paid the money they owed to Pennington, to be deposited in the payroll escrow account, months or even years before. Upon receiving these notices, the clients contacted Pennington, who offered a variety of excuses for the notices, such as claiming that there had been clerical errors, that the IRS had made mistakes, that the payroll tax checks and IRS notices had crossed in the mail, etc. Pennington consistently assured his clients that he would take care of the problems with the IRS, and this temporarily abated his clients' concerns. It was not until after Pennington reported his employee's theft to the Dawson County Sheriff's Office in May 2008 that the official investigation and a private audit of his financial records revealed to some of his clients that he had failed to pay their payroll taxes because he had been illegally withdrawing and transferring funds from the payroll escrow account for several years.

After the State finished presenting its case-in-chief, Pennington made a motion for a directed verdict of acquittal on all counts of the indictment and argued that the court should grant his motion to quash because the State had failed to prove that its prosecution of him on the indictment was not barred by the statute of limitation. The trial court then denied the motion to quash, finding that the State had met its burden of proving that the charged offenses had occurred within the statute of limitation period, and it denied the motion for a directed verdict, ruling that the issues of identity, criminal intent, circumstantial evidence, and witness credibility were for the jury to determine.

(a) Before reaching the merits of Pennington's argument that the statute of limitation barred the State's prosecution of any offenses that occurred before September 13, 2006 (i.e., four years before the indictment was filed), we must address the State's argument that Pennington cannot prevail on this claim because the indictment was a superseding indictment that related back to the accusation it timely filed on December 4, 2009. As shown above, in that accusation, the State charged Pennington with committing four counts of felony theft by conversion in 2006 and 2007, i.e., within the four-year statute of limitation period. The State contends, therefore, that, even if it filed the indictment after the statute of limitation period for Counts 1 through 11 had expired, as Pennington contends, those counts were not fatally defective and its prosecution of those counts was not barred. We disagree.

[A] superseding indictment brought after the statute of limitation has run is valid as long as (i) the original indictment[ ] is still pending; (ii) the original indictment was timely; and (iii) the superseding indictment does not broaden or substantially amend the original charges. Whether an amended indictment broadens or substantially amends the charges contained in the original indictment depends upon whether the new charges contain elements that are separate and distinct from the original charges.
(Citations and punctuation omitted; emphasis in original.) Martinez v. State, 306 Ga.App. 512, 523(2), 702 S.E.2d 747 (2010). Further, the determination of whether the indictment broadens or substantially amends the original charges is an issue of law for the court. Lee v. State, 289 Ga. 95, 96, 709 S.E.2d 762 (2011).

In this case, the record shows that the accusation only charged Pennington with four counts of theft by conversion, that each offense was allegedly committed within eight- to twelve-month periods in either 2006 or 2007, and that each count charged Pennington with illegally taking funds from “Warren Pennington's Payroll Escrow Account,” without naming any individual or business who had deposited funds into that escrow account. In contrast, the indictment charged Pennington with committing three counts of theft by conversion during certain periods in 2006 and 2007, but it also included two charges that he committed theft by conversion in 2004 and 2005—additional offenses that the State clearly did not allege in the accusation. Further, the indictment added seven counts of theft by taking that allegedly occurred on specific dates in February, March, or April 2006. And, unlike the accusation, which stated that Pennington had stolen from his business' payroll escrow account, each of the counts of the indictment named specific and independent businesses that had deposited funds into the escrow account for the purpose of paying their employees and payroll taxes and, thus, were the alleged victims of Pennington's thefts from the account.

Moreover, although the State offers the unsupported argument on appeal that the crime of theft by conversion, as charged in the accusation, is basically the same offense as the thefts by taking that are charged in Counts 3 through 8 of the indictment, it waived this argument by failing to raise it in the court below, as well as by failing to cite to any authority to support the argument on appeal. In fact, during the motion hearing, the State specifically argued that the thefts constituted different offenses, stating that the thefts are covered by two different statutes, so that “you can't lump them together” as if they are all the same kind of theft. According to the State, the thefts by conversion occurred when Pennington failed to timely pay the payroll taxes for clients who had already contributed the money to the payroll escrow account, while the thefts by taking occurred when Pennington withdrew or transferred money from the escrow account to pay his personal or business expenses.

Under these circumstances, we conclude that the indictment substantially and materially amended the accusation, so that the indictment did not relate back to the accusation. See Martinez v. State, 306 Ga.App. at 523(2), 702 S.E.2d 747 (holding that the State's decision to reissue an indictment that included an additional 13 false imprisonment counts and a kidnapping count substantially amended the charges in the original indictment because the additional offenses contain elements that are separate and distinct from the crimes charged in the original indictment). Consequently, we find that the State's filing of the accusation did not stop the running of the four-year statute of limitation period for filing the indictment.

(b) We now turn to Pennington's contention that the trial court erred in refusing to dismiss Counts 3 through 8 and 10 because the statute of limitation period for those offenses had expired. As shown above, Counts 3 through 8 of the indictment charged that Pennington committed theft by taking on specific dates in February, March, and April 2006, while Count 10 alleged that Pennington committed theft by conversion between the dates of February 22 and May 19, 2006. The State did not allege that any exception to the running of the statute of limitation period applied to those counts. Because the State did not file the indictment until September 13, 2010, the indictment shows on its face that all of those dates fall outside the four-year statute of limitation period. Accordingly, we agree with Pennington that those counts of the indictment were fatally defective and were subject to a general demurrer. See Jenkins v. State, 278 Ga. at 604(1)(B), 604 S.E.2d 789;State v. Barker, 277 Ga.App. at 87(3), 625 S.E.2d 500. Thus, the trial court erred in refusing to dismiss those charges, and Pennington's convictions on those counts must be reversed.

(c) As for Pennington's motion to quash Counts 1, 2, and 11, the question presented is whether the State met its burden of proving to the trial court either (i) that each offense was committed within the statute of limitation period or (ii) that an exception to the statute of limitation applied to toll the running of the statute. See Martinez v. State, 306 Ga.App. at 522(2), 702 S.E.2d 747.

(i) Count 11 alleged that Pennington committed theft by conversion at some point between July 31 and December 28, 2006. Therefore, the State had the burden of proving that the offense occurred between September 13 and December 28, 2006, i.e., a period within four years of the filing of the indictment. See id.

To that end, the State presented evidence showing that, in November 2006, Pennington failed to pay $3,035.75 in payroll taxes for a client named in Count 11, Horizon Controls, Inc. Thus, the record supports a finding that Pennington committed theft by conversion, as charged in Count 11, within the four-year statute of limitation period, and the trial court did not err in denying his motion to quash that count. See Martinez v. State, 306 Ga.App. at 522(2), 702 S.E.2d 747;State v. Bair, 303 Ga.App. at 183, 692 S.E.2d 806 (We must accept the trial court's findings on disputed facts unless they are clearly erroneous.); see also Stroud v. State, 284 Ga.App. 604, 610(3)(a), 644 S.E.2d 467 (2007) (Defense counsel's failure to file a motion to quash the indictment did not prejudice the defendant because, inter alia, the evidence showed that he committed the offenses charged in the indictment within the alleged date range and within the applicable statute of limitation period.).

(ii) Although the indictment alleged that the offenses charged in Counts 1 and 2 were committed outside the statute of limitation period (i.e., in 2004 and 2005, respectively), both counts also alleged that an exception applied to the running of the limitation period, specifically, that the offenses were not discovered until May 22, 2008, at the earliest. See OCGA § 17–3–2(2); State v. Campbell, 295 Ga.App. 856, 857–858, 673 S.E.2d 336 (2009); Stack–Thorpe v. State, 270 Ga.App. at 799(1), 608 S.E.2d 289.

In proving that the exception applied in this case, the State presented evidence showing that Pennington had failed to pay taxes due for one of his clients, Abbott Creek Nurseries, Inc., in both 2004 and 2005. Although Abbott Creek began receiving delinquent tax notices from the IRS in late 2007, Pennington repeatedly offered excuses to explain the notices, so Abbott Creek did not become aware that the taxes had not been paid until several months later, during the summer of 2008, i.e., after the State began its criminal investigation of Pennington in May 2008.

In addition, the State showed that Pennington had failed to pay the 2005 payroll taxes for another client, Horizon Controls, Inc., but that the crime was not discovered until July 2008.

Given this evidence, we conclude that the State met its burden of proving that the statute of limitation period was tolled until the crimes charged in Counts 1 and 2 were discovered. See Martinez v. State, 306 Ga.App. at 522(2), 702 S.E.2d 747;State v. Campbell, 295 Ga.App. at 857–858, 673 S.E.2d 336. It follows that the trial court did not err in denying Pennington's motion to quash those counts of the indictment.

(d) Given our ruling that the expiration of the statute of limitation period barred the State's prosecution on Counts 3, 4, 5, 6, 7, 8, and 10 of the indictment and that, as a result, Pennington's convictions on those counts must be reversed, we must determine whether the trial court's erroneous denial of Pennington's motion to quash those counts prior to trial, and the improper admission of evidence on those counts that resulted from such error, prejudiced Pennington to the extent that he was denied a fair trial as to the remaining counts. We find that, under the circumstances of this case, the admission of evidence on Counts 3 through 10 was unduly prejudicial to the jury's independent consideration of Pennington's guilt on Counts 1, 2, 11, and 12. See Jenkins v. State, 278 Ga. at 604–605(1), 604 S.E.2d 789 (holding that, if the trial court finds before trial that the statute of limitation barred the prosecution on certain counts of the indictment, “the State cannot present these charges to the jury at trial”) (footnote omitted). We also find that a reasonable probability exists that the jury's verdict would have been different if the evidence on those counts had not been disclosed to the jury. See London v. State, 274 Ga. 91, 94(4)(c), 549 S.E.2d 394 (2001) (A defendant may demonstrate reversible error by showing that, if the inadmissible evidence had not been disclosed to the jury, “there existed a reasonable probability that the result of the trial would have been different.”) (citation omitted). Accordingly, we conclude that Pennington is entitled to a new trial on Counts 1, 2, 11 and 12 of the indictment, and we hereby reverse those convictions and remand this case to the trial court for further proceedings.

2. Having reversed Pennington's convictions, we find that his remaining enumerated errors are moot.

Judgment reversed and case remanded. PHIPPS, C.J., concurs. BRANCH, J., concurs in the judgment only.