No. 05-02-01839-CR
November 21, 2003. DO NOT PUBLISH. Tex.R.App.P. 47.
On Appeal from the 203rd Judicial District Court, Dallas County, Texas, Trial Court Cause No. F01-01790-Mp.
Before Justices MOSELEY, RICHTER, and FRANCIS
JIM MOSELEY, Justice.
A jury convicted appellant Manuel H. Martinez, Jr., of misapplication of fiduciary property having a value of $200,000 or more. See Tex. Pen. Code Ann. § 32.45(b) (Vernon Supp. 2004). The trial court assessed punishment at seven years' confinement and a fine of $10,000. In addition, the trial court ordered restitution as a condition of parole in the amount of $1,086,000, which was subsequently reduced to $523,411.16. In five issues, Martinez argues: (1) the evidence is legally and factually insufficient to support his conviction for this offense because the State failed to prove he dealt with the property contrary to any agreement under which he held the property: (2) the trial court erred in admitting into evidence a facsimile transmission (fax) of a forged or altered letter, and two other forged or altered letters that were similar, that constituted a harmful extraneous offense; (3) even if evidence concerning the fraudulent transfer of funds was relevant, the trial court nevertheless erred in failing to exclude such evidence because any probative value was substantially outweighed by the danger of unfair prejudice; and (4) the order of restitution must be set aside because Martinez did not commit the offense of misapplication of fiduciary property. For the reasons below, we resolve Martinez's issues against him and affirm the trial court's order.
SUFFICIENCY OF THE EVIDENCE
In his first and second issues, Martinez challenges the legal and factual sufficiency of the evidence to support his conviction for the indicted offense. Specifically, Martinez contends that the State failed to prove that depositing Delta Electrical Contractors, Inc. (DEC) income and receivables into NationsBank accounts constituted dealing with such fiduciary property contrary to any agreement under which he held the property. A. Standard of Review and Applicable Law
We apply the appropriate standards of review. Jackson v. Virginia, 443 U.S. 307, 318-19 (1979) (legal sufficiency); Mason v. State, 905 S.W.2d 570, 574 (Tex.Crim.App. 1995) (legal sufficiency); Johnson v. State, 23 S.W.3d 1, 10-11 (Tex.Crim. App. 2000) (factual sufficiency). Under either review, the fact finder is the sole judge of the weight and credibility of witness testimony. Jones v. State, 944 S.W.2d 642, 647-48 (Tex.Crim. App. 1996). We measure the sufficiency of the evidence by the elements of the offense as defined by a hypothetically correct jury charge. Malik v. State, 953 S.W.2d 234, 240 (Tex.Crim. App. 1997); see Gollihar v. State, 46 S.W.3d 243, 256 (Tex.Crim.App. 2001) (A hypothetically correct charge need not incorporate allegations in the indictment that give rise to "immaterial variances."). A person commits the offense of misapplication of fiduciary property if he intentionally, knowingly, or recklessly misapplies property he holds as a fiduciary in a manner that involves substantial risk of loss to the owner of the property or to a person for whose benefit the property is held. Tex. Pen. Code Ann. § 32.45(b). "Misapply" means to deal with property contrary to an agreement under which the fiduciary holds the property or a law prescribing the custody or disposition of the property. Id. § 32.45(a)(2). The offense is a felony in the first degree if the value of the property misapplied is $200,000 or more. Id. § 32.45(c)(7). An agreement is a harmonious understanding or an arrangement between two or more parties as to a course of action. Bynum v. State, 767 S.W.2d 769, 777 (Tex.Crim.App. 1989). B. Discussion
The evidence showed that Martinez, Richard Hathcock, and Richard Hazard formed DEC in 1995. Martinez was the president and majority shareholder. The three shareholders agreed that Martinez would handle the financial side of the business. They chose Commercial State Bank as DEC's bank. Checks for certain amounts required two DEC signatures. Checks for DEC income should have been deposited in the Commercial State Bank operating account. They never discussed opening any other checking or savings accounts. DEC also had a special account, set up for a specific job. Transfers from the special account required one signature from the surety and one signature from DEC. In 2000, Commercial State Bank received a fax requesting transfer of $95,000 from the special account to the operating account. Pamela Davis, Commercial State Bank's chief lending officer, testified that the surety company called the bank to verify the balance in the special account. The bank then initiated an investigation of the DEC accounts. In reviewing the statements, Davis discovered some questionable checks. Davis discussed these checks with Hathcock, who knew nothing about the supplier to whom they were payable. Hathcock discussed this information with Hazard. They searched the office and discovered additional questionable checks and two letters related to the transfer request. Martinez had established two NationsBank accounts in DEC's name into which he had deposited checks payable to DEC. Just over $1 million had been deposited in the two accounts. Martinez withdrew money from these accounts for his personal use. Neither Hathcock nor Hazard knew about the NationsBank accounts. Hathcock and Hazard confronted Martinez, who admitted he had a gambling problem. DEC eventually went bankrupt. Martinez was indicted for intentionally, knowingly, and recklessly, pursuant to one scheme and continuing course of conduct, misapplying money with an aggregate value of $200,000 or more, contrary to an agreement under which he held the money as a fiduciary and in a manner involving substantial risk of loss to DEC, by diverting income for DEC's receivables and DEC money to specific unauthorized NationsBank accounts between 1996 and 2000. Hathcock said the NationsBank accounts were "unauthorized." Hazard testified that DEC was supposed to have bank accounts only at Commercial State Bank. Nevertheless, Martinez argues that the Shareholders' Agreement, signed by the three shareholders when DEC was incorporated, gave broad powers to the individual shareholders and officers, including Martinez. Accordingly, appellant argues, the Shareholders' Agreement authorized him, as majority shareholder, to open the NationsBank accounts and deposit DEC receivables and income into those accounts. Martinez also argues that, although the three shareholders had never discussed the use of another bank, neither Hathcock nor Hazard had ever told him that he could not establish another bank account. He contends that he, as manager of DEC's fiscal affairs, was intended to have more authority and make more decisions than Hathcock and Hazard. However, the Written Consent of Directors in Lieu of the First Meeting of the Board of Directors, signed by all three shareholders, provides that Commercial State Bank is "hereby selected and designated as depositories of [DEC], . . . and that the appropriate officers of this Corporation be and each of them is hereby authorized to open and maintain, in the name of this Corporation, checking, savings, safe deposit, payroll or other accounts with such depositories as such officer(s) in his discretion deem appropriate. . . ." We conclude that this provision in the Written Consent is evidence that any discretion that the Shareholders' Agreement gave Martinez regarding opening bank accounts and depositing DEC monies was limited by the selection of Commercial State Bank as DEC's depository. Having considered the evidence in the record (including the above evidence) in the light most favorable to the verdict, we conclude a rational trier of fact could have found beyond a reasonable doubt that Martinez committed the offense of misappropriation of fiduciary property with an aggregate value of $200,000 or more. See Jackson, 443 U.S. at 319; Mason, 905 S.W.2d at 574. Further, reviewing all the evidence in a neutral light, we cannot say the evidence of guilt is so obviously weak as to undermine confidence in the fact finder's determination, or that the proof of guilt is greatly outweighed by contrary proof. See Johnson, 23 S.W.3d at 10-11. In reaching this conclusion, we reject Martinez's argument that the State failed to prove that he, Hathcock, and Hazard had reached a harmonious understanding or arrangement that DEC income and receivables were to be deposited in Commercial State Bank accounts and that Martinez's diversion of these monies into unauthorized NationsBank accounts was contrary to the agreement of the parties. See Bynum, 767 S.W.2d at 777. We need not further detail the relevant evidence. Clewis v. State, 922 S.W.2d 126, 135 (Tex.Crim.App. 1996). We resolve Martinez's first and second issues against him. In his fifth issue, Martinez contends the order of restitution must be set aside because he did not commit the offense of misapplication of fiduciary property for the reasons stated in issues one and two. See Campbell v. State, 5 S.W.3d 693, 697 (Tex.Crim.App. 1999) ("A trial court may not order restitution for an offense for which the defendant is not criminally responsible."). Thus, Martinez conditions resolution of his fifth issue on the resolution of issues one and two. Because we have resolved issues one and two against Martinez, we necessarily resolve issue five against him. ADMISSION OF EVIDENCE
In his third issue, Martinez argues that the trial court erred in admitting Exhibit No. 9, the fax requesting transfer of funds from the special account to the operating account, which Martinez altered or forged, and Exhibit Nos. 20 and 21, which were similar letters. It is undisputed that Exhibit No. 9 is evidence of a fraudulent transfer of $95,000 from DEC's special account to its operating account. Exhibits Nos. 20 and 21 are identical to Exhibit No. 9, except that the date of the original letter was altered. Martinez argues that the fraudulent transfer from the DEC special account to the operating account, involving evidence of forgery of the transfer request, was unrelated to the offense of misapplication of fiduciary property as alleged in the indictment and constituted inadmissible "extraneous conduct." The State responds that the evidence of the unauthorized transfer from the DEC special account to the operating account showed why the investigation that uncovered Martinez's crime was triggered. See, e.g., Crivello v. State, 4 S.W.3d 792, 798 (Tex. App.-Texarkana 1999, no pet.) (holding evidence of police response to report of assault of girlfriend necessary to jury's understanding of why police had gone to girlfriend's apartment and subsequently witnessed erratic driving, leading to arrest and conviction for driving while intoxicated). In his pretrial motion and at trial, Martinez objected that the evidence was inadmissible under evidence rules 402 and 404. We review the trial court's decision to exclude evidence under an abuse of discretion standard. Powell v. State, 63 S.W.3d 435, 438 (Tex.Crim.App. 2001); Montgomery v. State, 810 S.W.2d 372, 391 (Tex.Crim.App. 1990) (op. on reh'g). We reverse only when the trial court's decision was so clearly wrong as to lie outside the zone within which reasonable persons might disagree. Montgomery, 810 S.W.2d at 391. A. Applicable Law and Standard of Review
Rule of evidence 401 provides that evidence is relevant if it has any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence. Tex. R. Evid. 401. Once the proponent of an item of evidence shows that the evidence is logically relevant to some issue in the trial under rule 401, it is admissible under rule 402 unless the opponent of the evidence demonstrates that it should be excluded because of some other provision, whether constitutional, statutory, or evidentiary. Tex. R. Evid. 402. Pursuant to rule of evidence 404(b), evidence of other crimes, wrongs, or acts is not admissible to prove the character of a person and that he acted in conformity therewith. Tex. R. Evid. 404(b). However, evidence of other crimes, wrongs, or acts may be admissible for other purposes such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident. Id.; Montgomery, 810 S.W.2d at 386-86. Evidence of other crimes, wrongs, or acts may also be admissible as same transaction contextual evidence. Rogers v. State, 853 S.W.2d 29, 33 (Tex.Crim.App. 1993). "Same transaction contextual evidence is deemed admissible as a so-called exception to the propensity rule where `several crimes are intermixed, or blended with one another, or connected so that they form an indivisible criminal transaction, and full proof by testimony, whether direct or circumstantial, of any one of them cannot be given without showing the others.'" Mayes v. State, 816 S.W.2d 79, 86-87 n. 4 (Tex.Crim.App. 1991) (citation omitted). Thus, same transaction contextual evidence is admissible as an exception under rule 404(b) where such evidence is necessary to the jury's understanding of the instant offense. Rogers, 853 S.W.2d at 33. Only if the facts and circumstances of the instant offense would make little or no sense without also bringing in the same transaction contextual evidence, should the same transaction contextual evidence be admitted. Id. B. Discussion Even assuming the fax request and similar letters were not necessary to an understanding of the opening of the NationsBank accounts and diversion of DEC monies into them, Martinez would be required to show that a substantial right was affected in order to demonstrate harm. See Potier v. State, 68 S.W.3d 657, 665 (Tex.Crim.App. 2002) (applying harm analysis under rule of appellate procedure 44.2(b) to error in trial court's evidentiary ruling, unless "the evidence forms such a vital portion of the case that exclusion effectively precludes the defendant from presenting a defense"); Tex. R. App. P. 44.2(b). A substantial right is affected when the error had a substantial and injurious effect or influence in determining the jury's verdict. King v. State, 953 S.W.2d 266, 271 (Tex.Crim.App. 1997). A criminal conviction should not be overturned for non-constitutional error if the appellate court, after examining the record as a whole, has a fair assurance that the error did not influence the jury, or had but a slight effect. Johnson v. State, 967 S.W.2d 410, 417 (Tex.Crim.App. 1998). Here, there was evidence that Martinez filed false corporate documents, listed himself and his wife as signatories on the NationsBank accounts, and diverted into those accounts monies intended to pay the corporation's expenses. Thus, the evidence of the fraudulent transfer was cumulative of testimony regarding Martinez's diversion of DEC receivables and income contrary to the parties' agreement under which Martinez held the property as a fiduciary. Moreover, the evidence was not discussed extensively at trial, even though the State referred to the transfer and the forged or altered letters in closing argument. The jury was instructed that evidence of transactions other that those charged was admitted "only for the purpose of showing intent, motive, scheme to defraud, system or design, if it does." After reviewing the entire record we are fairly assured that the error, if any, of admitting the complained-of evidence did not influence the jury, or had but a slight effect. Therefore, we resolve Martinez's third issue against him. In his fourth issue, Martinez contends that, even if relevant, the trial court erred in failing to exclude the evidence because any probative value was substantially outweighed by the danger of unfair prejudice. See Tex. R. Evid. 403. In his motion in limine, Martinez argued that admission of the letters was irrelevant and unfairly prejudicial. At a hearing before arraignment, the trial court denied the motion in limine as to the transfer request. The following day, before evidence was presented, Martinez again objected to the admission of Exhibit No. 9: "And if I could expand on my objection beyond relevance, it would be extraneous conduct that we don't think is admissible." This objection was overruled, and the trial court instructed Martinez to "renew your objection before the jury." The trial court also stated: "But the running objection is in place, if you're comfortable with that." When Exhibit No. 9 was offered, Martinez objected: "Your honor, I object to this line of questioning on the basis of Rule 402 and Rule 404." The trial court overruled the objection, stating: "The record will reflect the objection she made, out of the presence of the jury, as though it was repeated in full at that time. You have a running objection to this testimony regarding this exhibit." Martinez objected to the admission of Exhibit Nos. 20 and 21: "Same objections that we had to State's Exhibit 9." The trial court overruled the objection. "It is well-settled that the denial of a motion in limine is not sufficient to preserve error for review, but rather there must be a proper objection to the proffered evidence." Castillo v. State, 79 S.W.3d 817, 826 (Tex. App.-Dallas 2002, pet. ref'd), cert denied, 123 S.Ct. 1593 (2003). Moreover, "an objection that proffered evidence amounts to proof of an `extraneous offense' will no longer suffice, by itself, to invoke a ruling from the trial court whether the evidence, assuming it has relevance apart from character conformity, is nevertheless subject to exclusion on the ground of unfair prejudice." Mongtomery, 810 S.W.2d at 388. Further objection based upon rule 403 is required. Id. Martinez's motion in limine alerted the trial court to his objection on grounds of "unfair prejudice" pursuant to rule 403. However, Martinez's objection to the evidence when offered at trial did not refer to "unfair prejudice" or rule 403. Martinez's rules 402 and 404 objections were consistent with the issues raised in his oral and written motions in limine. Therefore, we cannot say that the trial court could have understood Martinez's objection to include a rule 403 objection. We conclude that Martinez failed to preserve for review any complaint regarding rule of evidence 403. See Montgomery, 810 S.W.2d at 388-89; Castillo, 79 S.W.3d at 826. Accordingly, we need not address Martinez's fourth issue. CONCLUSION
Having resolved Martinez's first, second, third, and fifth issues against him, we affirm the trial court's judgment.