Opinion
No. 3-270 / 01-1455
Filed July 10, 2003
Appeal from the Iowa District Court for Black Hawk County, Jon C. Fister, Judge.
Herald Friedley appeals from his convictions for ongoing criminal conduct, six counts of first-degree theft, and two counts of second-degree theft. AFFIRMED.
Linda Del Gallo, State Appellate Defender, and James Tomka, Assistant Appellate Defender, for appellant.
Thomas J. Miller, Attorney General, Martha Boesen, Assistant Attorney General, Thomas Ferguson, County Attorney, and Danielle Davis, Assistant County Attorney, for appellee.
Considered by Zimmer, P.J., and Hecht and Eisenhauer, JJ.
Herald Friedley appeals his convictions for ongoing criminal conduct, six counts of first-degree theft, and two counts of second-degree theft. We affirm.
I. Background Facts and Proceedings.
Defendant Herald Friedley (Friedley) and his son Randy (Randy) were engaged in the auto sales business in Cedar Falls for many years, eventually operating Friedley Saab, Inc. Friedley Saab financed its new car inventory with a line of credit at the Citizens Bank Trust Co. Citizens Bank secured its advances on Friedley Saab's credit line by taking a security interest in Friedley Saab's new car inventory. The terms of Friedley Saab's credit and security agreement required Friedley Saab to apply the proceeds of each car sold to the amount advanced to purchase the particular car sold.
In December 1997 Friedley Saab's revenue was not sufficient to meet its operating expenses. As a result, new car sales proceeds were first applied to Friedley Saab's taxes and payroll expenses rather than to its debt secured by the bank's interest in those proceeds. In January 1998 Citizens Bank loan officer, James Chizek, visited Friedley Saab's dealership to audit its compliance with the terms of the security agreement. A number of the vehicles subject to Citizens Bank's security interest were missing. Randy Friedley assured Chizek that Friedley Saab's performance on its notes with Citizens Bank would improve the following month. Randy, however, did not tell Chizek the missing cars had been sold. When Chizek returned in February 1998, sixteen cars covered by the parties' security agreement could not be accounted for.
Randy told Chizek the cars were being test driven when, in fact, they had been sold. When Chizek later met with Herald Friedley, Friedley admitted the cars and the money were "gone." As a result, Citizens Bank cancelled Friedley Saab's line of credit and declared the unpaid balance of their notes due and payable. Friedley was subsequently charged with one count of ongoing criminal conduct, in violation of Iowa Code section 706A.2 (1997), six counts of first-degree theft, in violation of sections 714.1 and 714.2(1), and two counts of second-degree theft, in violation of sections 714.1 and 714.2(2). The State's theory was there was a theft of sales proceeds in which Citizens Bank held a security interest in violation of section 714.1(5) (a person "[t]akes, destroys, conceals or disposes of property in which someone else has a security interest, with the intent to defraud the secured party"). A jury found Friedley guilty of the crimes charged. He was sentenced to a term of imprisonment not to exceed twenty-five years on the charge of ongoing criminal conduct, a term of imprisonment not to exceed ten years on each of the charges of first-degree theft, and a term of imprisonment not to exceed five years on the two charges of second-degree theft, all to be served concurrently. These sentences were suspended and Friedley was placed on probation. Friedley appeals.
II. Sufficiency of the Evidence.
Friedley first contends the evidence is insufficient to support either the ongoing criminal conduct or theft convictions. A jury's verdict is binding if it is supported by substantial evidence. State v. Hopkins, 576 N.W.2d 374, 377 (Iowa 1998). Substantial evidence means evidence that could convince a rational trier of fact the defendant is guilty beyond a reasonable doubt. State v. Maghee, 573 N.W.2d 1, 10 (Iowa 1997).
A. Theft. Friedley maintains there is insufficient evidence to establish he had a specific intent to defraud the bank. Rather, he claims, his only intent was to raise enough cash to eventually pay off the bank. The trial court instructed the jury that in order to establish theft, the State had to prove Friedley specifically intended to defraud Citizens Bank, and that specific intent means "not only being aware of doing an act and doing it voluntarily, but in addition, doing it with a specific purpose in mind."
Our review of the trial record reveals adequate evidence from which the jury could infer that Friedley specifically intended to defraud Citizens Bank in violation of its security agreement. The inference of intent can be drawn from a number of circumstances. Between December of 1997 and February of 1998, Friedley directed that proceeds from the sales of cars not be paid to the bank in accordance with its security agreement, but rather that the proceeds be used first for employee wages and taxes. Friedley was aware of his obligation to the lender but specifically decided to breach the terms of the floor plan financing agreement. With the complicity of his son Randy, Friedley hid this scheme from bank representatives by lying about the status of the cars subject to the financing. His directions regarding the payment of proceeds and subsequent conduct sufficiently establish the requisite knowledge and intent to support the theft convictions.
B. Ongoing Criminal Conduct. Pursuant to the jury instructions, in order to prove "ongoing criminal conduct" the State had to establish (1) between September 17, 1997, and February 17, 1998, Friedley conducted the affairs of an enterprise, or aided Randy Friedley who conducted the affairs of an enterprise, (2) the affairs of which were conducted through specified unlawful activity, and (3) he had knowledge of the activity. "Specified unlawful activity" is defined as:
[a]ny act, including any preparatory or completed offense, committed for financial gain on a continuing basis, that is punishable as an indictable offense under the laws of the state in which it occurred and under the laws of this state.
Iowa Code § 706A.1(5). "Financial gain" is not defined by the statute.
Friedley argues the evidence is not sufficient to prove he committed the offense for "financial gain." In particular, he contends that because his ultimate intention was to pay off the bank at some point, the State's case fails as a result of the lack of income to him. We disagree. First, it was apparent Friedley Saab was experiencing severe financial problems, and there is evidence in the record tending to prove Friedley directed and agreed with Randy in the manner in which payments would be made following the sale of a car. This payment plan was clearly in violation of the financing agreement with Citizens Bank. This, of course, allowed Friedley Saab to remain viable and, as the State notes, held off creditors of the dealership. Although there may not be evidence Friedley's bank account actually increased as a result of his scheme, the statute only implies the actor's purpose must be for financial gain. We conclude the jury could reasonably infer from the evidence the purpose of Friedley's plan was for financial gain.
III. Motion to Dismiss Trial Information.
The State used a report from Iowa Department of Transportation (DOT) investigator Mike Athey, concerning the investigation of Friedley Saab, as the minutes of testimony. This report included the DOT's conclusions Friedley committed multiple thefts of secured property, and included summaries of interviews with Herald Friedley, Randy Friedley, James Swarbrick, Ronald Elderkin, and James Chizek.
On appeal, Friedley maintains the trial court erred in denying his motion to dismiss in which he argued that, because the report did not list all the occupations and addresses of the prospective witnesses, the minutes of testimony were deficient. Iowa Rule of Criminal Procedure 2.5(3) requires the State to file a trial information and
minutes of evidence of the witnesses which shall consist of a notice in writing stating the name, place of residence and occupation of each witness upon whose expected testimony the information is based, and a full and fair statement of the witness' expected testimony.
We review this issue for errors of law. State v. Johnson, 528 N.W.2d 638, 640 (Iowa 1995).
The State correctly notes Friedley's familiarity with all of the witnesses and their occupations. In addition, the State also notes it subsequently filed amended minutes of testimony which did set forth the names and addresses of the witnesses. We, like the trial court, conclude Friedley cannot make a credible claim that the trial information and attached minutes were insufficient to provide him with a full and fair statement of the witnesses' expected testimony against him. We affirm on this issue.
IV. David Lorensen's Testimony.
David Lorenson purchased Friedley Saab's promissory notes from the bank for $75,000. At trial Friedley sought to present the testimony of Lorenson to rebut Chizek's testimony Citizens Bank had not received payment for the vehicles. The district court did not admit the evidence, finding it was irrelevant. On appeal, Friedley contends the court erred in this ruling.
Determinations of relevance of evidence rest within the sound discretion of the trial court and will be reversed only upon a showing that such discretion has been abused. State v. Taggert, 525 N.W.2d 877, 881 (Iowa Ct.App. 1994). We find no abuse of discretion in the district court's decision. Whether the bank was subsequently repaid by a third party is irrelevant to whether Friedley committed ongoing criminal conduct and theft.
V. Restitution.
Friedley maintains the court erred in ordering excessive restitution. In the alternative, he asks that the case be remanded to the district court for a restitution hearing. We determine we are without jurisdiction to address this issue. See State v. Jose, 636 N.W.2d 38, 47 (Iowa 2001). The restitution amount was set by order on December 6, 2001, almost three months after the notice of appeal was filed in this case. Friedley should have requested a hearing pursuant to Iowa Code section 910.7, see id., in order to make a record on the propriety of the amount of restitution ordered. We affirm on this issue, and therefore deny the petition for limited remand
VI. Ineffective Assistance of Counsel.
Friedley first asks us to address the issues of sufficiency of the evidence and whether the court properly excluded David Lorensen's testimony under an ineffective assistance analysis should we determine they are not properly preserved for our review. Further, he claims counsel was ineffective in providing advice regarding his right to testify at trial.
We review ineffective assistance constitutional claims de novo. See State v. Brooks, 555 N.W.2d 446, 448 (Iowa 1996). Friedley must prove two elements to succeed on these claims: (1) counsel failed to perform an essential duty; and (2) this failure resulted in prejudice. See State v. Ceaser, 585 N.W.2d 192, 195 (Iowa 1998). Such claims are usually preserved for postconviction relief actions; but where the record is adequate, we will consider them on direct appeal. See id. Having already addressed the first two issues on their merits, we only need address the right to testify issue.
A. Right to Testify. Friedley did not testify at trial. On appeal, he claims he wished to testify as to how his intention was merely to keep the dealership viable in order to sell it and pay off the bank. He asks us to preserve for postconviction relief the question of whether counsel provided competent advice so that he knowingly and intelligently waived his right to testify. We find the record inadequate to address this issue, and therefore preserve it for a possible postconviction proceeding. See Berryhill v. State, 603 N.W.2d 243, 245 (Iowa 1999).
VII. Pro Se Brief.
Herald Friedley has filed a pro se brief in which he raises a number of issues. Several of these issues merely reiterate those raised by counsel, and have been addressed above. We thus need not address them again. However, we do address two particular issues.
A. Ineffective Assistance. First, Friedley advances a series of ineffective assistance claims. In complaining of the adequacy of an attorney's representation, it is not enough to simply claim that counsel should have done a better job; for example, should have called certain witnesses. Dunbar v. State, 515 N.W.2d 12, 15 (Iowa 1984) (citing State v. White, 337 N.W.2d 517, 519 (Iowa 1983)). The defendant must state specific ways in which counsel's performance was inadequate and how competent representation probably would have changed the outcome. Id. Here, Friedley does not allege with any specificity how these alleged shortcomings by counsel prejudiced him or how the outcome of the proceedings would have been different but for the claimed errors. Accordingly, we find the ineffectiveness claims raised in Friedley's pro se brief to be lacking sufficient specificity to allow us to deal with them on appeal or preserve them for possible postconviction relief. See Dunbar, 515 N.W.2d at 15.
B. Aiding and Abetting. Second, Friedley contends the court "erred by interjecting theories of aiding and abetting and joint criminal conduct into the case on its own motion." In particular, he argues "the Court was not acting as an impartial and neutral judicial officer, but had assumed the role of a prosecutor." However, he advances no authority in favor of this contention, and we therefore deem it waived. See Iowa R.App.P. 6.14(1)( c).
VIII. Conclusion.
We have considered all arguments, whether specifically addressed in this opinion or not, and find them to be without merit. We therefore affirm Friedley's convictions.