Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of -Tuolumne County. Eleanor Provost, Judge, Super. Ct. No. CRF20568.
Barbara J. Coffman, under appointment by the Court of Appeal, for Defendant and Appellant.
Edmund G. Brown, Jr., Attorney General, Dane R. Gillette, Chief Assistant Attorney General, Michael P. Farrell, Senior Assistant Attorney General, Louis M. Vasquez, Brian Alvarez and Kathleen A. McKenna, Deputy Attorneys General, for Plaintiff and Respondent.
OPINION
Levy, Acting P.J.
INTRODUCTION
Appellant Gary Ward Bailey, Jr., was convicted after jury trial of one count of conspiring to defraud another of property, as alleged in count II of the information. (Pen. Code, §§ 182, subd. (a)(4).) He was acquitted of the crime of theft from an elder or dependent adult, as alleged in count I of the information. (§ 368, subd. (d).) Appellant admitted one prior strike and four prior felony convictions. (§§ 667, subds. (b)-(i); 1170.12, subds. (a)-(e); 1203, subd. (e)(4).) He was sentenced to four years imprisonment (doubled two-year midterm).
Unless otherwise specified, all statutory references are to the Penal Code.
Appellant argues, inter alia, that the jury charge was prejudicially defective because the jurors were not instructed on the conspiracy’s target crime of fraud. We agree with appellant that the trial court had a sua sponte obligation to instruct on the elements and mental state necessary to commit fraud. (People v. Cook (2001) 91 Cal.App.4th 910, 918 (Cook).) This instructional omission is prejudicial and requires reversal of the conspiracy conviction.
FACTS
I. Prosecution evidence.
John Ramsey is a supervisor for a company that acts as a third party administrator for insurance companies that do not have their own claims departments. Ramsey supervised the handling of a claim submitted by appellant to State National Insurance Company (the insurer) for damages to his 1969 Ford Ranchero.
Steve Lucero was the individual responsible for working on appellant’s claim. Lucero received numerous telephone calls from Reno Breschi, who owned a body shop, asking whether a check had been issued for appellant’s damage claim.
On October 19, 2005, Ramsey asked the insurer to issue a check for $3,762 payable to appellant (the first check). The first check was mailed to appellant in care of Reno’s Auto Body and Paint.
Unless otherwise specified, all dates refer to 2005.
Both appellant and Breschi subsequently telephoned Ramsey to inform him that they had not received the first check.
On October 28, Lucero received a voice mail message from appellant stating that he had not received the first check. Appellant asked Lucero to place a stop payment on this check. Lucero began the process to stop payment on the first check later that day.
Lucero informed Breschi during a telephone conversation that once a stop payment procedure was instituted, if the first check was found, it would not be valid.
On October 31, Breschi entered Central California Bank (bank) and attempted to cash a check made payable to appellant. The teller informed Breschi that she needed to see identification from appellant to cash the check. Breschi left the bank.
About an hour later, Breschi returned to the bank with appellant. They told the teller that they were going to call Jack Frediani, who would guarantee the check against his account. Frediani is 82 years old. Breschi and appellant left the bank.
They returned about 20 minutes later with Frediani. The bank manager, Doreen Wilber, advised Frediani that he was responsible for the check. Breschi, appellant and Frediani all endorsed the first check. The bank cashed it; Breschi received the proceeds.
On November 2, the insurance company issued a second check for $3,762 (the second check). It was made payable to both appellant and Reno Breschi Auto Body. It was sent to appellant in care of Breschi’s business address.
A few days later, Frediani received a call from his bank informing him that a stop payment had been placed on the first check.
On November 8, Breschi brought the second check to the Money Mart. Breschi presented appellant’s identification to the cashier, Genevieve Pearson. Breschi told Pearson that appellant was ill and could not come to the Money Mart.
Pearson telephoned appellant, who verified that he had signed the check and released it to Breschi. Pearson telephoned Ramsey, who verified that the check was valid. Pearson cashed the check and Breschi received another $3,762.
On November 15, Frediani telephoned Ramsey. Frediani told Ramsey that he cashed a check for appellant and then discovered that a stop payment request had been placed on the check. Ramsey told Frediani that a second check had been issued by the insurance company and that payment had been stopped on the first check; Ramsey told Frediani that there was nothing he could do to help him.
On November 22, appellant telephoned 911 and reported that Breschi had “defrauded him, his friend and the insurance company by cashing a check” that he told appellant he did not receive.
Appellant was interviewed by Tuolumne County Sheriff’s Department Sergeant Rolland DeMartini. Appellant told DeMartini he did not receive any money from the first check. Appellant said Breschi told him the first check bounced so Breschi needed appellant’s identification to cash the second check. Appellant told a Money Mart employee that it was “okay[]” to cash the second check. When asked to explain the fact that he was involved in the cashing of both checks after having called the insurer to place a stop payment on one of them, appellant “said that Breschi was trying to make it right with Frediani.”
As of the trial date, Frediani had not been reimbursed the $3,762 paid out of his account to cover the first check. Neither the bank, nor Money Mart nor the insurer suffered any losses resulting from the cashing of both checks.
II. Defense evidence.
Appellant testified on his own behalf. He was concerned when the first check did not arrive. Appellant thought that Breschi might be “a scumbag.” Appellant “figured” that Breschi had “done something with the check.” Therefore, he asked Lucero to place a stop payment on the first check.
Breschi came to his house on October 31 and told him that he had received the first check. Breschi assured appellant that he had called to verify that it was good. Appellant met Breschi and Frediani at the bank. After the first check was cashed, Breschi took the money from the teller and put it in his pocket.
A few days later, Breschi called appellant and told him that they needed to cash the second check and deposit the money into Frediani’s bank account to cover the first check “or we were going to be charged for fraud charges and all that.” Appellant signed the second check and gave Breschi his identification. Breschi was supposed to deposit the check to Frediani’s bank account. Appellant did not know why Breschi took the check to Money Mart. Later, Breschi told appellant that after cashing the check at Money Mart, he took the money to Frediani’s bank and deposited it.
Appellant called the police after learning that Frediani had not been reimbursed for the $3,762 that was taken from his bank account to cover the first check.
Appellant did not receive any money from either check and his car has not been repaired. He did not intend to steal from or to defraud anyone and he did not intend to assist Breschi in defrauding anyone.
Appellant admitted a prior burglary conviction and a prior conviction for receiving stolen property. He also admitted serving four prior prison terms.
DISCUSSION
I. The jury charge was prejudicially deficient because it did not include any instructions on the conspiracy’s target offense of fraud.
A. The trial court had a sua sponte obligation to instruct on the required elements and mental state necessary to commit the crime of fraud.
i. Facts
Appellant and Breschi were charged in count I of the information with theft from an elder or dependent adult in violation of section 368, subdivision (d). The information named Frediani as the victim of count I. The jury was instructed on the elements of theft from an elder or dependent adult. Also, the jury was instructed that appellant “is charged in Count 1 with theft” and it was instructed that appellant “has been prosecuted for theft under two theories: theft by larceny and theft by trick.” The jury was instructed on theft by false pretenses and on theft by trick. The jury was not instructed that Frediani was the named victim of the charged theft.
Appellant and Breschi were charged in count II of the information with conspiracy to defraud another of property in violation of section 182, subdivision (a)(4). The information named the insurer and/or Money Mart as the victims of count II; it alleged that appellant and Breschi conspired “to cheat and defraud” the insurer and/or Money Mart. In relevant part, the jury was instructed that “The People allege that the defendant conspired to commit the following crimes: fraud. You may not find the defendant guilty of conspiracy unless all of you agree that the People have proved that the defendant conspired to commit the crime of fraud.” The jury was also instructed: “To decide whether the defendant and the other alleged members of the conspiracy intended to commit fraud, please refer to the separate instructions that I will give you on that crime[]. [¶] The People must prove that the members of the alleged conspiracy had an agreement and intent to commit fraud.” However, the jury was not instructed on the elements of the crime of fraud or the mental state necessary to commit the crime of fraud. The jury was not instructed that the theft instructions applied to the conspiracy count. Also, the jury was not instructed that the named victims of the charged conspiracy were the insurer and/or Money Mart.
This subdivision provides that it is criminal to conspire with another “[t]o cheat and defraud any person of any property, by any means which are in themselves criminal, or to obtain money or property by false pretenses or by false promises with fraudulent intent not to perform those promises.” (§ 182, subd. (a)(4).)
The prosecutor stated during his closing argument that the victim of the conspiracy was either the insurer or the Money Mart. However, it is axiomatic that arguments by an attorney do not constitute an acceptable substitute for proper instruction to the jury by the court. (People v. Miller (1996) 46 Cal.App.4th 412, 426, fn. 6.)
ii. Failure to instruct on the elements of fraud was erroneous.
Appellant contends, and we agree, that the court was required to instruct on the elements and mental state necessary to commit the crime of fraud. Additionally, the jury should have been instructed on the identity of the alleged victims of the conspiracy.
It is well recognized that the trial court has a sua sponte obligation to instruct on the elements of the target offense of a charged conspiracy. (Cook, supra, 91 Cal.App.4th at p. 918.) Our Supreme Court explained the rationale supporting this obligation in People v. Horn (1974) 12 Cal.3d 290 (Horn):
“Conspiracy is a ‘specific intent’ crime. [Citations.] The specific intent required divides logically into two elements: (a) the intent to agree, or conspire, and (b) the intent to commit the offense which is the object of the conspiracy. [Citations.] To sustain a conviction for conspiracy to commit a particular offense, the prosecution must show not only that the conspirators intended to agree but also that they intended to commit the elements of that offense.” (Horn, supra, 12 Cal.3d at p. 296.)
Horn continues:
“[S]section 182 clearly makes the punishment for conspiracy turn on the nature and degree of the conspired offense. Thus even if a defendant could be convicted of conspiracy in the abstract, he could not be punished until the trier of fact ascertained the criminal object of the conspiracy. To determine whether the object of defendants’ conspiracy in the present case was the commission of a first degree murder, the trier of fact obviously would need to know the elements of that offense.” (Horn, supra, 12 Cal.3d at pp. 297-298.)
In Cook, supra, 91 Cal.App.4th 910 the appellate court explained, “Under section 182, the jury must determine which felony the defendants conspired to commit, and it cannot make that determination unless it is instructed on the elements of the target offense charged as well as the elements of any lesser included target offense which the jury could reasonably find to be the object of the conspiracy. [Citation.]” (Id. at p. 918.) Therefore, the trial court has a sua sponte obligation to instruct on the elements of the target offense and any lesser included target offenses. (Ibid.)
Respondent argues that the obligation to instruct on fraud was satisfied by the theft instructions that were given in connection with count I, relying on the maxim that the jury charge must be considered in its entirety. This argument does not withstand scrutiny. The jury was specifically instructed that the target crime of the conspiracy was “fraud.” It was also instructed that it could “not find the defendant guilty of conspiracy unless all of you agree that the People have proved that the defendant conspired to commit the crime of fraud.” The jury was not alerted that the instruction on theft by false pretenses had any application to the conspiracy charge or any relation to the crime of fraud. The jury was not instructed that the theft instructions applied to the conspiracy count. On the contrary, the jury was instructed that “The defendant is charged in Count 1 with theft” and that he “has been prosecuted for theft under two theories: theft by larceny and theft by trick.” Reasonable jurors would not have independently divined that the theft instructions also applied to the conspiracy offense or have understood that the instruction on theft by false pretenses also set forth the elements of the conspiracy’s target crime of fraud. Additionally, the theft count alleged that Frediani was the victim of this crime while the conspiracy count alleged that the intended victims of the fraud were the insurer or Money Mart. Factually and legally, stealing from an elderly man by tricking him into guaranteeing a stopped check is quite different than participating in an unsuccessful conspiracy to defraud either the insurer and/or Money Mart.
The prosecutor argued in closing that defendant “knew the [first] check was no good when he walked in the bank….” He continued, “[T]hey watched [$3,700] leave this man’s account knowing that the old man was going to foot the bill.”
Accordingly, we conclude that the trial court failed to satisfy its obligation to instruct on the charged conspiracy’s target crime. It had a sua sponte obligation to provide the jury with instructions setting forth the elements and mental state necessary to commit the crime of defrauding another in violation of section 182, subdivision (a)(4), and to name the alleged victims of the charged conspiracy.
Our determination that the court had a sua sponte obligation to instruct on the conspiracy’s target offense moots appellant’s argument that defense counsel was ineffective because he did not request such instruction.
B. The instructional omission is prejudicial.
Failure to instruct on the elements of an offense is subject to harmless error review under Chapman v. California (1967) 386 U.S. 18 (Chapman). (People v. Flood (1998) 18 Cal.4th 470, 502-507.) Under Chapman, the burden is on the People to prove beyond a reasonable doubt that the error did not contribute to the verdict and, therefore, was harmless beyond a reasonable doubt. (Chapman, supra, 386 U.S. at pp. 24, 26.)
Having reviewed the record in this case, we find that appellant was prejudiced by the instructional omission. The evidence proving the charged conspiracy to defraud another, while legally adequate, was not overwhelming. The jury did not make any other findings from which this court can infer that it necessarily understood and found against appellant on the missing elements in the conspiracy charge. The jurors were not given any guidance as to the meaning of the terms “defraud” or “fraud.” They were not instructed on the elements or mental state necessary to commit this crime. It is likely that each individual juror applied his or her own particular understanding of the meaning of the phrase “defrauding another.” Moreover, since the victim of the alleged fraud was not named and Frediani was the only person or entity who lost any money, it is possible that the jurors mistakenly believed that Frediani was the intended victim of the charged conspiracy; this is one possible explanation for the not guilty verdict on the theft count. In sum, we cannot conclude beyond a reasonable doubt that the verdict was not affected by the absence of proper instruction on the charged conspiracy’s target crime. Therefore, the error is prejudicial and requires reversal of the conspiracy conviction.
II. There is substantial evidence proving intent.
Appellant challenges the sufficiency of the evidence proving intent to defraud the insurer and/or Money Mart and argues that the trial court should have granted the acquittal motion (§ 1118.1) made by defense counsel at the close of the prosecution’s case-in-chief. Notwithstanding our conclusion that the conspiracy conviction must be reversed because of instructional error, we will resolve appellant’s sufficiency of the evidence claim because this offense may be retried only if the jury’s guilty verdict is supported by substantial evidence. As will be explained, the evidence is legally sufficient to support the guilty verdict.
Defense counsel did not offer any argument supporting the acquittal motion. The court denied the motion. In relevant part, it reasoned that the jury could find appellant guilty of count II because appellant gave his identification to Breschi so that Breschi could cash the second check with the knowledge that the first check already had been cashed.
The applicable standard of appellate review is undisputed. When assessing the sufficiency of the evidence, a reviewing court considers the entire record in the light most favorable to the judgment below to determine whether there is substantial evidence from which a reasonable trier of fact could find the defendant guilty beyond a reasonable doubt. (People v. Hawkins (1995) 10 Cal.4th 920, 955.) “The California Supreme Court has held, ‘Reversal on this ground is unwarranted unless it appears “that upon no hypothesis whatever is there sufficient substantial evidence to support [the conviction].”’ [Citations.]” (People v. Gaut (2002) 95 Cal.App.4th 1425, 1430.) The reviewing court presumes in support of the judgment the existence of every fact the trier reasonably could deduce from the evidence, including reasonable inferences based on the evidence. (People v. Tran (1996) 47 Cal.App.4th 759, 771-772.) We do not reweigh evidence or determine if other inferences more favorable to the defendant could have been drawn from it. (People v. Stanley, supra, 10 Cal.4th at p. 793.)
To sustain a conspiracy conviction the prosecutor must prove, inter alia, that the defendant specifically agreed to conspire with one or more people and that the defendant specifically intended to accomplish the specified target offense. (People v. Morante (1999) 20 Cal.4th 403, 416.) Thus, in this case the prosecution was required to prove appellant agreed to conspire with Breschi to defraud either the insurer and/or Money Mart.
We reject appellant’s challenge to the sufficiency of the evidence proving intent because it fails to acknowledge that intent may be inferred from all the circumstances. Rarely will there be evidence directly proving the existence of the conspiracy or the conspirator’s criminal intent. There is no need to show that the conspirators met and actually agreed to commit the offense that is the object of the conspiracy; the unlawful design of the conspiracy may be proved by circumstantial evidence. (People v. Aday (1964) 226 Cal.App.2d 520, 534.) “The evidence is sufficient if it supports an inference that the parties positively or tacitly came to a mutual understanding to commit a crime. [Citation.] The existence of a conspiracy may be inferred from the conduct, relationship, interests, and activities of the alleged conspirators before and during the alleged conspiracy.” (People v. Cooks (1983) 141 Cal.App.3d 224, 311.) “It is seldom possible for the prosecution to offer direct evidence of an agreement to commit a crime. The agreement to commit the crime is usually made in secrecy. The conspiracy must be inferred by the trier of fact from all the circumstances that are proven, and if the inference is a reasonable one it will not be disturbed on appeal.” (People v. Chavez (1962) 208 Cal.App.2d 248, 253.)
In this case, a reasonable trier of fact could deduce the existence of intent to conspire and intent to defraud from evidence demonstrating that appellant appeared at the bank to participate in the cashing of the first check after calling the insurer to stop payment on the first check. He did not tell anyone at the bank that a stop payment had been placed on the first check; he did not call the insurer to verify that the check he and Breschi were cashing was a new check and not the first check. Later, appellant gave Breschi his identification so that Breschi could cash the second check at a different financial institution, the Money Mart. Appellant knew a check from the insurer paying for his damage claim had been cashed because he was present at the bank when the first check was cashed. Yet, he did not alert the teller at the Money Mart that there may be a problem or mistake relating to the cashing of two checks for one damage claim. Appellant did not telephone the insurer to provide it with this information. Instead, appellant told the teller that he had signed the check and released it to Breschi. Thus, appellant actively participated in the cashing of both checks. The fact that neither the insurer nor the Money Mart actually suffered any financial loss is immaterial; one may be guilty of conspiracy without successfully committing the crime that is the object of the conspiracy. (Morante, supra, 20 Cal.4th at pp. 416-417.) The absence of evidence proving that appellant received any of proceeds from the two cashed checks likewise is not determinative.
Accordingly, we reject appellant’s challenge to the sufficiency of the evidence supporting the guilty verdict. Therefore, the conspiracy count can be retried if the prosecutor elects to do so.
If appellant is retried on the conspiracy count and the information is not amended to specify a single victim, a unanimity instruction should be given. (See, e.g., People v. McNeill (1980) 112 Cal.App.3d 330, 335-336.)
DISPOSITION
The judgment is reversed.
WE CONCUR: Cornell, J., Hill, J.