Opinion
A156397
01-09-2020
THE PEOPLE, Plaintiff and Respondent, v. GARY W. ADKISSON, Defendant and Appellant.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Napa County Super. Ct. No. CR155130)
As a condition of probation, Gary W. Adkisson was ordered to pay over $2 million in direct victim restitution after pleading no contest to felony counts arising from his participation in a fraudulent investment scheme. We affirmed that order in People v. Adkisson (Sept. 15, 2014, A140321 [nonpub. opn.] (Adkisson).) Adkisson now appeals from a January 2019 order modifying his probation to increase his minimum monthly restitution payment from $428 to $1,000. We affirm.
BACKGROUND
A.
John Stewart managed an investment fund known as Cornerstone Income Fund. After soliciting money from several individuals, he invested the proceeds into Adkisson's business, Pro-Action Concepts, which purported to develop fitness centers throughout the country. After the investors learned their money was lost, the Napa County District Attorney filed a complaint charging Adkisson and Stewart with multiple felony counts.
On May 17, 2011, Adkisson entered a no contest plea to grand theft (Pen. Code, § 487, subd. (a)); making a misleading statement in the offer or sale of a security (Corp. Code, § 25401); theft from an elder (Pen. Code, § 368, subd. (d)); offer or sale of an unregistered security (Corp. Code, § 25110); and operation of a scheme or artifice in the sale of a security (Corp. Code, § 25541). He admitted the amount of the loss in connection with two of the counts exceeded $500,000. (§ 186.11, subd. (a)(2).) Under the plea agreement, the court would impose an aggregate term of 13 years, four months in prison, but suspend execution of that sentence and place Adkisson on probation conditioned on his serving one year in the county jail and paying direct victim restitution in an amount totaling $2.763 million.
Undesignated statutory references are to the Penal Code unless otherwise stated.
Stewart also entered a plea and is jointly and severally liable for the full amount of restitution. He is not a party to this appeal.
At the sentencing hearing in August 2011, the court placed Adkisson on five years of probation and ordered him to pay $2.763 million in restitution proportionately to all victims. As a probation condition, in December 2012 the court ordered Adkisson to make monthly restitution payments of "at least" $250 to the Cornerstone Victims' Association. In July 2013, the probation department filed a petition to modify the terms of probation based on Adkisson's receipt of $58,191.19 from a tax refund. After the court ordered the full amount of $58,191.19 be paid to the victims over Adkisson's objection, we affirmed the order in a prior appeal.
In August 2015, the trial court increased Adkisson's minimum monthly payment to $428 per month or 25 percent of his salary, whichever is higher. By July 2016, the balance owed the victims was over $4 million because the payments to date had not been substantial enough to cover the interest, let alone the principal, owed to the victims. Adkisson and Stewart had paid a total of only $200,000 in restitution. The People moved to extend Adkisson's probation term to 10 years to facilitate the continued payment of restitution. (See § 186.11, subd. (h)(1)(B).) The court granted the motion, extending his probation term to August 4, 2021, or until restitution is paid in full, whichever occurs first.
B.
This appeal concerns the trial court's decision on January 24, 2019 to modify Adkisson's probation by increasing his minimum restitution payment from $428 to $1000 per month, effective February 1, 2019. Prior to its modification order, the court ordered Adkisson to provide information concerning his income, assets, and employment to his probation officer.
Adkisson submitted information indicating that he worked 40 hours per week earning an hourly wage as an independent contractor for his wife's publishing company, Krullstone Publishing. His annual income remained unchanged since 2014. Adkisson's employment history included experience in consulting and management services. Defense counsel asserted Adkisson had medical issues precluding him from working more but did not provide supporting evidence.
In support of their motion to increase his minimum monthly payment, the People argued that Adkisson was underemployed and willfully avoiding his restitution obligations. The People asserted that, because Adkisson worked for his wife, he and his wife could control his earnings and thereby limit the amount of monthly restitution paid. The People acknowledged that Adkisson had unsuccessfully applied for other jobs and that his status as a felon made it "not tenable" for him to obtain some of the jobs he sought. However, Adkisson's co-defendant was able to obtain three jobs and was paying about $2,200 a month in restitution. Adkisson lived at his wife's residence, and his wife paid his living expenses and provided financial support for restitution and legal fees. The People submitted a statement from the victims indicating that Adkisson was late in his restitution payments in December 2016, January 2017, February through August of 2017, and September of 2018.
At a hearing on January 24, 2019, two of the elderly victims testified. Walter Spicer, aged 89, stated that the victims of Adkisson's crimes lost the life savings they needed for retirement. Because of these crimes, Spicer and his wife had to sell their house and rent instead, liquidate their investments, and take on part-time jobs during their retirement. Captain Klaus Niem and his wife had to go into debt to pay their bills and could not afford to pay for their daughter's wedding or repair their car. Niem's wife had recently passed away, while the amount owed to the victims was still over $4 million.
After hearing testimony, the court modified Adkisson's probation to require a minimum monthly payment of $1,000 commencing with his February 1, 2019 payment. The court reasoned that his previous minimum payment amount was insufficient given the overall restitution amount of $2.7 million. The court concluded Adkisson was "underemployed," explaining that given Adkisson's education, "life experience[,] and work experience," he was capable of earning more than $20,000 per year.
After Adkisson appealed, we granted his motion to stay proceedings in the trial court pending the issuance of the remittitur on appeal.
DISCUSSION
Adkisson contends the trial court abused its discretion in increasing his minimum monthly restitution payment because the modification was not supported by changed circumstances. We disagree.
The trial courts have "broad discretion to impose probation conditions to foster rehabilitation and to protect public safety." (People v. Anderson (2010) 50 Cal.4th 19, 26 (Anderson), citing People v. Carbajal (1995) 10 Cal.4th 1114, 1120; see also In re Bine (1957) 47 Cal.2d 814, 817 (Bine) [court "has a wide discretion in imposing or modifying the terms of probation"].) "Conditions are imposed on probation 'to the end that justice may be done, that amends may be made to society for the breach of the law, for any injury done to any person resulting from that breach, and generally and specifically for the reformation and rehabilitation of the probationer.' " (People v. Cookson (1991) 54 Cal.3d 1091, 1097 (Cookson), quoting § 1203.1, subd. (j).) The court's discretion thus includes the power to require payment of victim restitution as a condition of probation. (§ 1203.1 subds. (a)(3), (b); Anderson, supra, 50 Cal.4th at pp. 26-27; see also § 1203.1, subd. (k) [court may determine manner of restitution].)
While the trial court has "authority at any time during the term of probation" to modify its probation order (§ 1203.3, subd. (a)), "[a] change in circumstances is required" to justify modification. (Cookson, supra, 54 Cal.3d at p. 1095.) "An order modifying the terms of probation based upon the same facts as the original order granting probation is in excess of the jurisdiction of the court, for the reason that there is no factual basis to support it." (In re Clark (1959) 51 Cal.2d 838, 840; see also, Bine, supra, 67 Cal.2d at p. 818 [invalidating order modifying probation where no facts had changed].)
In Cookson, the trial court originally ordered the defendant to pay restitution as determined by the probation department. (Cookson, supra, 54 Cal.3d at p. 1093.) Although the court contemplated that the restitution would equal the victim's total loss ($12,000), the probation department set the monthly payment at $100 (later increased to $135), consistent with the defendant's ability to pay, which after three years had yielded only $4,085. (Id., at pp. 1094-1095.) Even though the defendant complied with all probation terms, on the day before defendant's probation was to expire, the court modified the probation terms by extending it two years and increasing the payments, reasoning that the defendant had not paid the full amount of restitution. (Id., at p. 1095.)
Our Supreme Court affirmed. It held that the requisite change in circumstance "could be found in a fact 'not available at the time of the original order,' " i.e., where the monthly payment schedule resulted in the defendant's inability to pay full restitution within the original probation period. (Cookson, supra, 54 Cal.3d at p. 1095.) Notably, one justice dissented, reasoning that the defendant's inability to pay was ascertainable at the time of the original sentence, and it "cannot be considered a new fact merely because the court overlooked it." (Id., at p. 1101, Mosk, J. dissenting.) We read Cookson to stand for the proposition that a modification may be based on developments after the original order indicating that the restitution terms will not serve their purpose.
The record here supports increasing Adkisson's minimum monthly payment. Adkisson promised to pay over $2.7 million in restitution to his victims, and, in ordering probation, the trial court contemplated that the victims would be meaningfully compensated. When the court set Adkisson's minimum monthly payment amount in 2015, the court expressed an expectation that he would be "working more" or "looking for a different job," and that he "pay as much restitution as he can." Consistent with an expectation that Adkisson would improve his employment situation, the court set the minimum monthly payment at $428 or 25 percent of his income, whichever is greater. The court could not have known in 2015 that over the next three years Adkisson would fail to secure higher-paying employment, pay only the absolute minimum given his overall restitution obligation, or be repeatedly late with his payments. (See Bearden v. Georgia (1983) 461 U.S. 660, 668 (Bearden) [probationer must "make sufficient bona fide efforts to seek employment or borrow money in order to pay . . . restitution"].) Other facts not known to the trial court in 2015 were that Adkisson's elderly victims had to take on jobs during their retirement and go into debt to survive; one victim died while the restitution remained largely unpaid.
Neither did the trial court abuse its discretion in setting Adkisson's minimum payment at $1,000. Adkisson did not submit evidence of his expenses nor of hardship he would face if his minimum payment were increased. The evidence showed his living expenses were paid by his wife and that she had provided thousands of dollars of financial support. Based on the available evidence, the trial court reasonably concluded that Adkisson could afford to pay more. (See People v. Whisenand (1995) 37 Cal.App.4th 1383, 1392-1393 [where spouse paid living expenses, defendant would have more of own income available].) The trial court also made clear that, if Adkisson presented evidence concerning his alleged medical condition or other relevant circumstances, the court would revisit the issue.
Adkisson contends he is also obligated to pay $250 per month in another restitution case. However, Adkisson failed to make this argument in the trial court in opposing modification of probation and did not provide evidence that he was still required to make this payment as of January 2019. This type of evidence would be appropriate to submit should he move to modify his probation in trial court.
Lastly, we note that, in addition to or as an alternative to changing the payment schedule, a court faced with a defendant's willful unemployment or underemployment may require that the defendant make good faith attempts to obtain more remunerative employment or attend job training and may require proof that the defendant applied for a specified number of jobs on a periodic basis. (See Charles S. v. Superior Court (1982) 32 Cal.3d 741, 751 [probation officer may require "an offender to make all efforts within his ability to provide reparation to his victim," such as requiring offender "to make a good-faith search for employment"]; cf. Moss v. Superior Court (1998) 17 Cal.4th 396, 423 [parent who fails to pay child support due to willful underemployment can be held in contempt; court may require parent to submit proof of job applications].) While probation cannot be revoked if a defendant's indigence precludes payment of restitution, revocation is appropriate if the facts establish the defendant has the ability to pay but willfully fails to do so. (§ 1203.2, subd. (a); Cookson, supra, 54 Cal.3d at pp. 1096-1097, discussing Bearden, supra, 461 U.S. 660.)
In determining a defendant's ability to pay, the court may consider earning capacity. (People v. Staley (1992) 10 Cal.App.4th 782, 785 ["Ability to pay does not necessarily require existing employment or cash on hand."].) --------
DISPOSITION
The judgment is affirmed. The June 28, 2019 order granting a stay of the superior court proceedings in this matter until the issuance of the remittitur is hereby modified such that the stay shall run until the date this opinion becomes final. (Cal. Rules of Court, rule 8.366(b)(1).)
/s/_________
BURNS, J. WE CONCUR: /s/_________
JONES, P. J. /s/_________
NEEDHAM, J.