Opinion
G054324
10-03-2018
THE PEOPLE, Plaintiff and Respondent, v. JUDY HOPPER MOLSON, Defendant and Appellant.
James R. Bostwick, Jr., under appointment by the Court of Appeal, for Defendant and Appellant. Xavier Becerra, Attorney General, Julie L. Garland, Assistant Attorney General, Eric A. Swenson, Kristine Gutierrez, and Genevieve Herbert, Deputy Attorneys General, for Plaintiff and Respondent.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super. Ct. No. 10HF0586) OPINION Appeal from an order of the Superior Court of Orange County, Steven D. Bromberg, Judge. Reversed and remanded. James R. Bostwick, Jr., under appointment by the Court of Appeal, for Defendant and Appellant. Xavier Becerra, Attorney General, Julie L. Garland, Assistant Attorney General, Eric A. Swenson, Kristine Gutierrez, and Genevieve Herbert, Deputy Attorneys General, for Plaintiff and Respondent.
Judy Hopper Molson appeals from the trial court's order awarding restitution to Leo Innerbichler, the victim of Molson's elder abuse. Molson argues the following: the court abused its discretion in ordering restitution; the court erred by admitting expert testimony; and the court erred by awarding attorney fees. The Attorney General asserts we must modify the order to reflect the total amount of restitution; Molson disagrees.
We will refer to Leo and his family by their first names for ease of reference. --------
As we explain below, although we conclude the trial court properly admitted expert testimony, we agree with Molson there was no "factual nexus" between Molson's conduct and the restitution award, and consequently the court's attorney fees award must also be reversed. Because we reverse the restitution award and fees award, we decline the Attorney General's request to modify the abstract of judgment. We reverse the order and remand the matter.
FACTS
I. Underlying Offense & Conviction
We need not provide a detailed account of the underlying facts as they can be found in People v. Molson (Dec. 18, 2014, G048942 [nonpub. opn.] (Molson)). Suffice it to say, Molson was prosecuted for elder abuse of Leo (Pen. Code, § 368, subd. (b)(1), all further statutory references are to the Penal Code, unless otherwise indicated); theft of property worth more than $400 from an elder (§ 368, subd. (e)); and eavesdropping (§ 632, subd. (a)). The evidence at trial established the following.
Leo, 86 years old at the time of trial, was married to Mabel Innerbichler for over 50 years. They had had two children, Jennifer Mizban and Stephen Innerbichler. Molson owned the barbershop where Leo and Mabel got their hair cut. When Mabel became disabled, Molson helped care for her. Around that time, Leo was diagnosed with "moderate dementia."
After Mabel died in December 2006, Leo and Molson remained friends and she began accompanying him to medical appointments. In 2008, Molson accompanied Leo to a doctor's appointment to get blood testing to get married. They eventually got a confidential marriage license and were married.
Contemporaneous with Leo's and Molson's relationship, things began to disappear, including ornaments, rings, collectibles, housewares, and furniture. Leo uncharacteristically purchased expensive cars, and put Molson's name on his car's title. Additionally, Molson repeatedly asked Leo for money for personal uses.
In May 2009, Stephen obtained the power of attorney over Leo's finances and discovered he had credit card debt totaling $40,000, which was uncharacteristic. About the same time, Adult Protective Services determined the deed to Leo's house was solely in Molson's name. The next month, the Costa Mesa Police Department started an investigation of Molson's conduct. Effective November 2009, the family placed Leo under a conservatorship with Stephen as conservator of Leo's person and estate. Molson refused Stephen's repeated requests to return Leo's personal property and credit cards.
Because Molson accompanied Leo to appointments and represented herself as Leo's "caretaker," the doctor instructed both Molson and Leo about the type, quantity, timing and frequency of doses of medicine needed to treat his diabetes, dementia, depression, and incontinence. Molson failed to test Leo's blood sugar, failed to fill prescriptions, and failed to ensure he took his medications. When Leo fell and was hospitalized, tests revealed his diabetes was "completely out of control," and Stephen and Jennifer subsequently hired an in-home caregiver. Molson repeatedly refused the caregiver entry. Molson also prevented Stephen and Jennifer from entering Leo's home and when they did, they discovered Molson had filled his pill box with Advil instead of his prescription medication.
A jury convicted Molson on all counts. The court sentenced Molson to five years in prison. We affirmed the convictions. II. Restitution
The trial court held a series of restitution hearings beginning on April 3, 2015, and concluding on October 14, 2016. We will discuss each below. A. April 3, 2015
At the first restitution hearing, the prosecution called Jennifer to testify to the value of personal property Molson stole from Leo. Leo's family requested restitution in the amount of $8,850 for the following items: ornaments, rings, collectibles, housewares, and furniture. The court awarded restitution in the amount of $7,335 for the personal property. The prosecution also called Stephen to testify concerning attorney and accounting fees arising from Molson's convictions. Those fees consisted of the following: David Evans $8,000; Flanigan Law Group $30,000; Law Office of Sam Walker $2,000; Keith Green $2,053; and Ward Tax and Accounting $562. The court found the fees were reasonable and awarded $42,615. The court continued the hearing. B. February 19, 2016
Following a series of continuances, the court held a second hearing. Stephen testified as a lay witness for the prosecution. Stephen stated he earned a bachelor of science degree in accounting from California Polytechnic University, and he worked as a private accounting manager for six years. He held other accounting positions, including one with an accounting firm.
Stephen testified his father was "quite frugal." He served as conservator of Leo's estate since 2009. Based on bank statements from Leo's home, Stephen testified various accounts had been completely depleted. For example, in June 2007, a USAA Federal Savings Bank account had $92,000, and in December 2008 it had $0. In September 2007, a Fidelity Individual Retirement Account (IRA) account had $258,911, and in May 2010 it had $0. In March 2008, a Fidelity IRA trust account had $84,741.38, and in June 2008 it had $0. Stephen testified much, if not all, of the IRA money was transferred to Leo's checking or savings accounts.
Stephen testified Leo had three checking accounts and the bank statements showed there were numerous inter-account transfers. Leo's primary checking account showed disbursements for a Ferrari, Porsche, and Alfa Romeo, and personal loans to Molson. Stephen stated the checking account also reflected cash withdrawals and dozens of monthly debit purchases for retailers and restaurants, but he admitted the evidence did not demonstrate who was responsible for the cash withdrawals or that Molson received cash from Leo's accounts. Stephen noted that the increase in his father's spending after Stephen's mother died was "astronomical."
Stephen created a spreadsheet, prosecution's exhibit No. 20, using Leo's bank statements that reflected Leo's "normal" spending habits for the three years before Mabel died, September 2003 to December 2006, and the three years after she died, January 2007 to March 2010, the time Molson abused Leo. The spreadsheet included disbursements, but it also included a $56,000 tax refund for the IRA withdrawals and a $10,539 county property tax refund. During his testimony, Molson's defense counsel objected Stephen was improperly attributing certain assessments to Molson. The trial court disagreed, citing to Molson's convictions and stated the following: "By the way, he qualifies as an expert. I'm satisfied he qualifies as an expert. But, at the same time, he's wearing numerous hats." Based on this spreadsheet, Stephen estimated Leo's normal spending without Molson's criminal conduct would have been $88,249. The difference between Leo's normal level of spending and the amount he spent when Molson began abusing him in January 2007 was around $412,000. The court continued the hearing. C. March 18, 2016
The restitution hearing resumed the following month. The day of the hearing, Molson filed a motion to exclude Stephen's expert testimony because he was not an expert in forensic accounting and he could not be impartial, i.e., he was the victim's son and he had a financial interest in the outcome of the case. Additionally, relying on section 1202.4, subdivision (f), she asserted there was no evidence Leo's losses were caused by her criminal conduct. Finally, Molson objected to the prosecution's request to admit exhibit Nos. 17-27, hundreds of pages of Leo's financial statements. The court admitted those exhibits, including exhibit No. 20.
At the hearing, defense counsel continued cross-examination of Stephen. In exhibit No. 20, Stephen explained he documented his father's financial losses by comparing his father's normal spending during the three years prior to his involvement with Molson with his father's normal spending during the three years after his father's involvement with her. Stephen testified Molson was responsible for the increased expenditures because Leo was "a pretty frugal guy." Stephen said they received the Alfa Romeo, without the title, and possessed the Cadillac. However, he stated they did not have the Ferrari, Porsche, or Chevrolet truck.
With respect to the motion to exclude Stephen's expert testimony, Molson's defense counsel added Stephen's testimony was speculative. The trial court responded, "[Y]ou asked for it. You open[ed] the door on almost every one of those situations. . . . You put him in a position of speculating right down the road. The [prosecution] left it alone. I left it alone." The prosecutor stated she called Stephen as the victim's son who was the conservator and "just so happens to be an accountant." She did not call him as an expert witness.
The trial court explained Stephen, who had an accounting background, was in the best position to testify as the victim's son and conservator and "most of his testimony did not require expertise." Additionally, based on Evidence Code sections 801 and 720, the court was "very comfortable finding him to be an expert[]" even though it was his first time testifying. The court said that even though Stephen was not a certified public accountant or the head of an accounting firm, he was an expert because he knew more than the common person and had special training, skill, and experience. The court opined that although Stephen was biased, he was credible and the "best individual" to testify and his testimony was supported by voluminous records. The court denied the motion, concluding most of Stephen's testimony did not require expertise and to the extent some of the testimony did, Stephen was qualified to give it.
After Stephen's testimony, the court asked the prosecution to prepare a proposed judgment and defense counsel to submit "realistic set-offs." Both parties subsequently submitted proposed recommendations to the court. The prosecution requested $402,400.94 in restitution (exhibit No. 20 total, $412,939.94, minus property tax refund $10,539). Molson stated the only amount Leo was entitled to was $6,241 and requested $332,532.69 in offsets. D. October 14, 2016
At the final restitution hearing, the trial court restated its ruling it accepted Stephen as a lay witness and an expert witness, and he was in the best position to testify concerning his father's spending habits. The court stated Stephen "conducted a comprehensive review of [Leo's] lifestyle and spending habits." The court concluded Stephen was credible and not biased. The court explained the evidence, Leo's bank and finance records, demonstrated his "spending habits changed significantly post . . . Molson . . . and for her direct benefit . . . ."
The trial court stated the prosecution's proposal was "comprehensive" and "explanatory" but requested the prosecutor revise the judgment's "syntax," leaving the "same amounts." The court ordered victim restitution in the amount of $395,400.94. The court arrived at this amount by deducting $7,000 from the prosecution's requested amount of $402,400.94 to account for Mabel's funeral expenses.
A few days later the prosecutor filed a revised final proposed judgment that stated, "Following the court's ruling on October 14, 2016, the People request that the court order [Molson] to pay $395,400.94 to [Leo]. This amount is in addition to the previous restitution order made by the court in the amount of $42,615 on April 3, 2015." But the final proposed judgment did not mention the $7,335 for loss of personal property.
The following month the court entered an order, Judicial Council form "Order For Victim Restitution," for restitution in the amount of $395,400.94 plus interest. This amount represented the court's restitution award on October 14, 2016. It is unclear whether this amount included restitution for loss of personal property ($7,335) and attorney and accounting fees ($42,053) the court awarded on April 3, 2015.
DISCUSSION
I. Restitution Award
Molson argues the trial court abused its discretion in awarding restitution based on exhibit No. 20 because its flawed methodology was based on averages without accounting for the basis of spending increases and benefits received. We agree.
Section 1202.4, subdivision (a)(1), provides, "It is the intent of the Legislature that a victim of crime who incurs an economic loss as a result of the commission of a crime shall receive restitution directly from a defendant convicted of that crime." A restitution order compensates a victim for his actual loss and does not provide the victim with a windfall. (People v. Pangan (2013) 213 Cal.App.4th 574, 581.) Section 1202.4, subdivision (f)(3), states, "To the extent possible, the restitution order shall be prepared by the sentencing court, shall identify each victim and each loss to which it pertains, and shall be of a dollar amount that is sufficient to fully reimburse the victim or victims for every determined economic loss incurred as the result of the defendant's criminal conduct . . . ." This section "'limits the scope of victim restitution to losses caused by the criminal conduct for which the defendant sustained the conviction.' [Citation.]" (People v. Rahbari (2014) 232 Cal.App.4th 185, 190.)
"[W]e review the trial court's restitution order for abuse of discretion. [Citations.] The abuse of discretion standard is 'deferential,' but it 'is not empty.' [Citation.] '[I]t asks in substance whether the ruling in question "falls outside the bounds of reason" under the applicable law and the relevant facts [citations].' [Citation.] Under this standard, while a trial court has broad discretion to choose a method for calculating the amount of restitution, it must employ a method that is rationally designed to determine the surviving victim's economic loss. To facilitate appellate review of the trial court's restitution order, the trial court must take care to make a record of the restitution hearing, analyze the evidence presented, and make a clear statement of the calculation method used and how that method justifies the amount ordered." (People v. Giordano (2007) 42 Cal.4th 644, 663-664, fn. omitted, italics added.)
Luis M. v. Superior Court (2014) 59 Cal.4th 300 (Luis M.), is instructive. In Luis M., our Supreme Court reversed a restitution award for felony vandalism calculated solely on a city's average cost per incident of graffiti. (Id. at p. 310.) The court concluded the city could not rely on an outdated average cost model when there was no connection, no factual nexus, between those average costs and minor's specific harmful conduct. (Id. at p. 309.) The court explained that because there was no evidence of the size or type of minor's graffiti, or the materials, equipment and labor required to remove it, there was simply insufficient evidence the average cost was appropriate. (Id. at p. 309.) The Luis M. court concluded, however: "According to the record before us, the City photographs graffiti as part of its investigation and tracks all incidents by computer. The photographs presumably reflect the size, extent, and type of graffiti involved. Using such evidence, a witness familiar with graffiti abatement could estimate the average cost per square foot (or other measure) to paint over or otherwise restore the defaced surfaces. Alternatively, business records reflecting time and materials might provide a rational basis for estimating costs." (Id. at p. 310, italics added.)
Both parties rely on Luis M. to support their contentions, Molson to argue there was no "factual nexus" between exhibit No. 20 and her harmful conduct, and the Attorney General to assert an average cost method is appropriate. We agree an average cost method is an appropriate starting point to determine the economic losses that can be attributed to the criminal conduct. But the court must also consider the circumstances of the case, the benefits the victim received, and the property that was returned. The record here does not demonstrate the court considered these things.
The primary basis for the court's restitution award was exhibit No. 20's before and after comparison and averaging of Leo's spending habits during the three years before Mabel died to Leo's spending habits the three years after she died and Molson became a prominent figure in his life. There was evidence Leo was a frugal man who did not spend lavishly. However, Leo's life changed when Mabel passed away.
It is reasonable to conclude Leo's monthly expenditures would increase after Mabel passed away. It is understandable Leo would eat out more, hire someone to help around the house, or spend more on entertainment. Perhaps Leo always dreamt of owning a sports car. And it is possible Leo would spend more if he decided he would like to begin dating someone, including Molson, which may not be the result of any criminal conduct, but instead an effort to impress someone. Additionally, the cost for life's necessities increases each year. Finally, it is not clear from the record whether the trial court considered any of the benefits Leo received from his spending, or the property that was returned. For example, there was evidence Leo and Molson ate some expensive dinners. Did the court deduct the amount of Leo's meal? Molson should not be charged the total cost of the Morton's steak dinner when Leo ate also. Did the court offset the market value of the Alfa Romeo that Stephen recovered?
Although restitution need not be exact (People v. Chappelone (2010) 183 Cal.App.4th 1159, 1172-1173), it must also not be the result of sweeping generalizations not caused by the defendant's criminal conduct. Here, the court's use of the average of what Leo spent before his involvement with Molson compared with the average of what he spent after his involvement Molson was not a rational method to determine restitution. Greater specificity in identifying each loss Molson caused, the benefits Leo received, and the property that was returned to Leo is necessary. Therefore, the court abused its discretion in awarding restitution in the amount of $395,400.94. II. Expert Witness
Molson contends the trial court erred by concluding Stephen was an expert witness because he was not qualified as a forensic accountant and his assumptions were speculative. Not so.
"'California law permits a person with "special knowledge, skill, experience, training, or education" in a particular field to qualify as an expert witness (Evid. Code, § 720) and to give testimony in the form of an opinion (id., § 801). Under Evidence Code section 801, expert opinion testimony is admissible only if the subject matter of the testimony is "sufficiently beyond common experience that the opinion of an expert would assist the trier of fact." [Citation.]'" (People v. Vang (2011) 52 Cal.4th 1038, 1044.) A trial court, however, has broad discretion to admit or exclude expert testimony. (People v. McDowell (2012) 54 Cal.4th 395, 426.) The level of due process at a restitution hearing is more limited than at a criminal or civil trial. (Chappelone, supra, 183 Cal.App.4th at p. 1184.)
Here, the trial court noted, and we agree, much of Stephen's testimony was as a lay witness. To the extent Stephen testified as an expert witness, he was certainly qualified. He graduated from college with a bachelor of science in accounting. At the time of the hearing, he worked as a private accounting manager for six years, and before that he held other accounting positions, including one with an accounting firm. Stephen's education, training, and experience qualified him to gather and analyze six years' worth of financial records and provide a comparison of specified years, and this was beyond common experience and assisted the trier of fact. That he relied on an averaging method instead of a actual loss method does not alter our conclusion.
Additionally, Stephen's testimony was not speculative. Again, Molson admits "evidence of certain specific losses was presented to the court." The trial court had before it hundreds of pages of Leo's financial documents, and exhibit No. 20, which detailed Leo's spending habits for the three years before and three years after Molson influenced his spending habits. As we explain above, Molson's defense counsel cross-examined Stephen extensively concerning his methodology, and we cannot conclude the court abused its discretion in relying on it. Thus, the court did not abuse its discretion in concluding Stephen was qualified to testify as an expert witness. III. Attorney Fees
Molson argues the trial court erred by awarding attorney fees for conservatorship services and the marriage annulment because attorney fees are limited to fees incurred to collect restitution. We agree the court erred but for a different reason.
Section 1202.4, subdivision (f)(3), provides as follows: "To the extent possible, the restitution order . . . shall be of a dollar amount that is sufficient to fully reimburse the victim or victims for every determined economic loss incurred as the result of the defendant's criminal conduct, including, but not limited to" 11 enumerated categories of expenses, including "[a]ctual and reasonable attorney's fees and other costs of collection accrued by a private entity on behalf of the victim" (§ 1202.4, subd. (f)(3)(H)). We review the trial court's award for an abuse of discretion. (People v. Millard (2009) 175 Cal.App.4th 7, 31 [trial court does not properly exercise discretion when it misunderstands or misapplies applicable legal standard].)
Here, Molson does not dispute Green's fees for rescinding the transfer of Leo's home were recoverable. She disputes Evans's and Flanigan's fees for conservatorship proceedings and Walker's fees for annulling the marriage because these fees were not incurred to collect restitution. We agree the court erred by awarding conservatorship proceedings fees but not for the reason Molson complains of.
The evidence at trial demonstrated Leo began to suffer dementia before Mabel died in December 2006. Regardless of Molson's criminal conduct, the evidence established it was likely Leo would have been subject to conservatorship proceedings, and thus there was insufficient evidence Molson's criminal conduct was the cause of these fees. With respect to the marriage annulment fees, it is reasonable to conclude this economic loss could be attributed to Molson's conduct but the record is undeveloped on this point. On remand, the prosecution must offer evidence the fees were incurred as a result of Molson's criminal conduct. Although Molson disputes only some of the fees, we reverse the entire $42,615 fee award because we conclude the court's $395,400.94 restitution award must be reversed and remanded.
Because we reverse and remand the matter, we need not address the Attorney General's claim we must modify the abstract of judgment to reflect the court's restitution awarded on April 3, 2015. On that date, the first day of the restitution hearing, the court award Leo $7,335 for personal property and $42,615 for attorney and accounting fees. But it is unclear whether the court intended these amounts to be in addition to, or included in, the court's October 14, 2016, award of $395,400.94. The court's November 15, 2016, order for victim restitution is not definitive on this issue.
DISPOSITION
The order is reversed and the matter is remanded.
O'LEARY, P. J. WE CONCUR: MOORE, J. IKOLA, J.