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holding that "any course of conduct that does not give rise to a conviction may not be relied on as a basis for assessing restitution against a defendant" under MCL 780.766
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Docket No. 147391. Calendar No. 4.
2014-06-26
PEOPLE v. McKINLEY.
Bill Schuette, Attorney General, Aaron D. Lindstrom, Solicitor General, David E. Gilbert, Prosecuting Attorney, and Marc Crotteau, Assistant Prosecuting Attorney, for the people. State Appellate Defender Office (by Christopher M. Smith) for defendant.
Bill Schuette, Attorney General, Aaron D. Lindstrom, Solicitor General, David E. Gilbert, Prosecuting Attorney, and Marc Crotteau, Assistant Prosecuting Attorney, for the people. State Appellate Defender Office (by Christopher M. Smith) for defendant.
Kym L. Worthy and Timothy A. Baughman, Detroit, for the people.
McCORMACK, J.
In this case, we decide whether a trial court's restitution award that is based solely on uncharged conduct
may be sustained. We conclude that it cannot. We therefore overrule our decision in People v. Gahan, 456 Mich. 264, 571 N.W.2d 503 (1997), to the extent that Gahan held that MCL 780.766(2) “authorizes the sentencing court to order criminal defendants to pay restitution to all victims, even if those specific losses were not the factual predicate for the conviction.” Gahan, 456 Mich. at 270, 571 N.W.2d 503. Accordingly, we vacate the portion of the judgment of sentence ordering that the defendant pay $158,180.44 in restitution, and remand to the trial court for entry of an order assessing $63,749.44 in restitution against the defendant.
For purposes of this opinion, the phrase “uncharged conduct” refers to criminal conduct that the defendant allegedly engaged in that was not relied on as a basis for any criminal charge and therefore was not proved beyond a reasonable doubt to a trier of fact.
I. FACTS AND PROCEDURAL HISTORY
In January 2011, Battle Creek police officers arrested the defendant because they believed him to be responsible for a series of thefts of commercial air conditioning units in the area. Following a trial, a jury found the defendant guilty of larceny over $20,000, malicious destruction of property over $20,000, and inducing a minor to commit a felony.
The trial court sentenced the defendant, as a fourth-offense habitual offender, to concurrent terms of 12 to 25 years in prison on each count. The trial court reserved a decision on restitution until after sentencing. Following a hearing, and over defense counsel's objection to the amount of restitution assessed, the trial court entered an amended judgment of sentence to reflect the imposition of $158,180.44 in restitution against the defendant. Of that total, the defendant was ordered to pay $63,749.44 to the four victims of the offenses of which he was convicted and $94,431 to the victims of uncharged thefts attributed to the defendant by his accomplice.
The defendant employed a teenage accomplice, whom he rewarded with money and cigarettes, to help him remove the air conditioning units. His accomplice testified against the defendant at trial pursuant to a plea agreement.
The Court of Appeals vacated the defendant's conviction for larceny over $20,000, but otherwise affirmed his convictions and sentences. People v. McKinley, unpublished opinion per curiam of the Court of Appeals, issued May 16, 2013 (Docket No. 307360), 2013 WL 2120278. The panel rejected the defendant's argument that Michigan's restitution scheme is unconstitutional because it permits trial courts to impose restitution on the basis of facts not proven to the trier of fact beyond a reasonable doubt. Id. at *8.
We granted leave to appeal, 495 Mich. 897, 839 N.W.2d 201 (2013), limited to the following issues:
(1) whether an order of restitution is equivalent to a criminal penalty, and (2) whether Michigan's statutory restitution scheme is unconstitutional insofar as it permits the trial court to order restitution based on uncharged conduct that was not submitted to a jury or proven beyond a reasonable doubt. See Southern Union Co. v. United States, 567 U.S. ––––, 132 S.Ct. 2344, 183 L.Ed.2d 318 (2012); Apprendi v. New Jersey, 530 U.S. 466, 120 S.Ct. 2348, 147 L.Ed.2d 435 (2000); contra People v. Gahan, 456 Mich. 264, 571 N.W.2d 503 (1997).
II. STANDARD OF REVIEW
The proper application of MCL 780.766(2) and other statutes authorizing the assessment of restitution at sentencing is a matter of statutory interpretation, which we review de novo. Hunter v. Hunter, 484 Mich. 247, 257, 771 N.W.2d 694 (2009). “The first step when interpreting a statute is to examine its plain language, which provides the most reliable evidence of intent.” Ter Beek v. City of Wyoming, 495 Mich. 1, 8, 846 N.W.2d 531 (2014). If the statutory language is unambiguous, no further judicial construction is required or permitted. Id. Questions involving the constitutionality of a statute are also reviewed de novo. Hunter, 484 Mich. at 257, 771 N.W.2d 694.
III. ANALYSIS
The defendant's challenge to the restitution award is premised on the Sixth Amendment to the United States Constitution, specifically Apprendi and its progeny. Defendant challenges both the amount of the restitution award above $63,749.44 (the amount based on uncharged conduct) and the amount between $20,000 and $63,749.44 (the amount based on convicted conduct above and beyond the amount specifically found by a jury). Only the former argument was preserved by a timely objection.
Ultimately, we do not reach either of defendant's constitutional challenges to the restitution award. As to the former, pursuant to the widely accepted and venerable rule of constitutional avoidance,
At the restitution hearing, defense counsel argued that “the current state of the law would require that ... there would have been have [sic] some proof beyond a reasonable doubt that those other ‘complainants' if you will, were also those that were victimized by the Defendant.” In other words, counsel argued only that the portion of the restitution award based on the uncharged offenses had to be proven beyond a reasonable doubt.
we conclude that it is necessary to revisit the statutory analysis of MCL 780.766(2) we set forth in Gahan. Ashwander v. Tenn. Valley Auth., 297 U.S. 288, 347, 56 S.Ct. 466, 80 L.Ed. 688 (1936) (Brandeis, J., concurring) (“[I]f a case can be decided on either of two grounds, one involving a constitutional question, the other a question of statutory construction or general law, the Court will decide only the latter.”).
This rule is well established in both United States Supreme Court caselaw and this Court's precedent. See Ashwander v. Tenn. Valley Auth., 297 U.S. 288, 347, 56 S.Ct. 466, 80 L.Ed. 688 (1936) (Brandeis, J., concurring) (“The Court will not pass upon a constitutional question although properly presented by the record, if there is also present some other ground upon which the case may be disposed of.”); Slack v. McDaniel, 529 U.S. 473, 485, 120 S.Ct. 1595, 146 L.Ed.2d 542 (2000) (quoting Justice Brandeis's concurring opinion in referring to “[t]he Ashwander rule”); Smith v. Curran, 267 Mich. 413, 418, 255 N.W. 276 (1934) (holding that the “constitutionality of an act will not be passed upon where a case may be otherwise decided”).
We believe that adherence to that rule is particularly appropriate in this case because the statutory analysis in Gahan is so plainly incomplete and the defendant's constitutional challenge to restitution based on uncharged conduct is a novel one that other courts have not addressed (indeed, have not even been called upon to address).
That is, given that we conclude that Michigan's statutory restitution scheme does not permit the trial court to order restitution based on uncharged conduct, it is unnecessary to decide whether such a scheme would be unconstitutional. Contrary to the dissent's characterization, there is nothing at all inappropriate as to the approach we have taken in this case, and it is an approach that is consistent with the well-established rule that the “constitutionality of an act will not be passed upon where a case may be otherwise decided[.]” Smith, 267 Mich. at 418, 255 N.W. 276. Furthermore, the parties in this case were in no way denied an “opportunity to be heard” regarding this issue, as suggested by the dissent. The parties were free to argue that Gahan wrongly held that Michigan's statutory restitution scheme permits the trial court to order restitution based on uncharged conduct, and defense counsel did at least address this point at oral argument, at which he stated:
I think Justice McCormack's second question is whether there is an alternative way of addressing this and one way would be to limit this Court's previous decision in People v. Gahan. In People v. Gahan, this Court construed the statutory language very broadly where a course of conduct could mean anything—it didn't—it wasn't limited to just what the jury found.
In addition, in his brief filed with the Court, defense counsel specifically asked us to “overrule Gahan.” Finally, the prosecutor also recognized that “[t]his Court, in its order granting leave, pointed the parties at [ Gahan ] as a potential source of useful precedent.” Therefore, it is clear that the parties themselves recognized that they were accorded an opportunity to be heard regarding our decision in Gahan.
Finally, we note that despite the dissent's criticism of our decision not to reach the constitutional question and its defense of Gahan's statutory analysis, the dissent does not reach the constitutional question either. And if that constitutional hurdle proves unresolvable to the dissent, one wonders whether that opinion should be a concurrence instead.
Notably, and we believe further supporting our decision not to reach the constitutional issue, the apparent reason other courts have not been asked to address the argument that the defendant raises here is because those courts have (seemingly uniformly) construed their restitution statutes as allowing the assessment of restitution based only on convicted conduct. See, e.g., Hughey v. United States, 495 U.S. 411, 413, 110 S.Ct. 1979, 109 L.Ed.2d 408 (1990); State v. Clapper, 273 Neb. 750, 758, 732 N.W.2d 657 (2007); Commonwealth v. McIntyre, 436 Mass. 829, 835 n. 3, 767 N.E.2d 578 (2002) (collecting cases applying various standards requiring a causal relationship between the restitution award and the conviction). Accordingly, we are aware of no court that has reached the argument defendant preserved below: whether Apprendi and its progeny bar the assessment of restitution based on uncharged conduct. See also United States v. Sharma, 703 F.3d 318, 323 (C.A.5, 2012) (“The [Mandatory Victim Restitution Act, 18 U.S.C. § 3663A] limits restitution to the actual loss directly and proximately caused by the defendant's offense of conviction. An award of restitution cannot compensate a victim for losses caused by conduct not charged in the indictment or specified in a guilty plea, or for losses caused by conduct that falls outside the temporal scope of the acts of conviction.”).
As to the defendant's challenge to the restitution award based on convicted conduct, we conclude that the issue is not properly before us because the defendant has waived it.
The defendant did not raise any question regarding the portion of the restitution award based on convicted conduct in his initial application for leave to appeal in this Court, but instead posited that the entirety of the restitution award based on convicted conduct passed constitutional muster. Only after we granted leave to appeal did the defendant assert that only $20,000 of the restitution award was constitutional under Apprendi. A waiver “extinguishe[s] any error,” People v. Carter, 462 Mich. 206, 216, 612 N.W.2d 144 (2000), thereby foreclosing appellate review, id. at 215, 612 N.W.2d 144.
Waiver is defined as “the ‘intentional relinquishment or abandonment of a known right.’ ” People v. Carter, 462 Mich. 206, 215, 612 N.W.2d 144 (2000), quoting People v. Carines, 460 Mich. 750, 762 n. 7, 597 N.W.2d 130 (1999) (citation and quotation marks omitted).
A. STATUTORY INTERPRETATION
MCL 780.766(2) provides in part that “the [sentencing] court shall order, in addition to or in lieu of any other penalty authorized by law or in addition to any other penalty required by law, that the defendant make full restitution to any victim of the defendant's course of conduct that gives rise to the conviction or to the victim's estate.” In Gahan, we discussed the Legislature's use of the term “course of conduct” and determined that term should be given a broad construction in light of its historical background and prior decisions from the Court of Appeals interpreting a similar statute.
Gahan, 456 Mich. at 271–272, 571 N.W.2d 503. Notably, however, the Gahan Court devoted no attention to the modifying phrase “that gives rise to the conviction....”
Those prior decisions interpreted MCL 771.3(2), now MCL 771.3(1)(e), which contains identical language to MCL 780.766(2) for all purposes relevant to our analysis. Similarly, other statutes allowing for the assessment of restitution also have identical language for all relevant purposes. See, e.g., MCL 769.1a(2); MCL 780.826(2).
The dissent provides an impassioned defense of Gahan and disagrees that the Gahan Court ignored this language, but in fact other than quoting this statutory language as part of its background discussion, the Gahan Court did not discuss it or attempt to interpret it or give independent meaning to it; it limited its statement of the question before it as “whether ‘course of conduct’ should be given a broad or narrow construction.” Gahan, 456 Mich. at 271, 571 N.W.2d 503. But “[c]ourts must give effect to every word, phrase, and clause in a statute and avoid an interpretation that renders nugatory or surplusage any part of a statute.” People v. Couzens, 480 Mich. 240, 249, 747 N.W.2d 849 (2008).
The dissent's view that the Legislature intended to adopt the unique, common-law meaning of “course of conduct” from People v. Gallagher, 55 Mich.App. 613, 223 N.W.2d 92 (1974) is unpersuasive. First, as the dissent acknowledges, that rule was not universally followed. See People v. Blaney, 139 Mich.App. 694, 363 N.W.2d 13 (1984). Second, even in cases purporting to follow Gallagher, its scope was open to interpretation. See People v. Seda–Ruiz, 87 Mich.App. 100, 105, 273 N.W.2d 602 (1978) (Maher, J., concurring) (“I write separately to state my concern that the record does not reveal that all the bad checks allegedly issued by defendant were made part of the plea agreement. Unless defendant agreed to make restitution for all the checks and the prosecutor agreed not to institute charges on the basis of those checks, defendant may not be required to make restitution for all the checks, but only those listed in the information to which he pled guilty and the information which was nolle prossed as part of the plea agreement. In such a case, of course, the prosecutor would be entitled to bring charges on the basis of the checks which are not part of the plea agreement.”) (emphasis added). We conclude that interpreting the statutory language according to its plain meaning is preferable to concluding that the Legislature selected such language to adopt a standard that was not consistently followed or fully settled.
We conclude that the Gahan Court's reading of MCL 780.766(2) is not sustainable and must be overruled. The plain language of the statute authorizes the assessment of full restitution only for “any victim of the defendant's course of conduct that gives rise to the conviction....” The statute does not define “gives rise to,” but a lay dictionary defines the term as “to produce or cause.” Random House Webster's College Dictionary (2000), p. 1139. Only crimes for which a defendant is charged “cause” or “give rise to” the conviction. Thus, the statute ties “the defendant's course of conduct” to the convicted offenses and requires a causal link between them. It follows directly from this premise that any course of conduct that does not give rise to a conviction may not be relied on as a basis for assessing restitution against a defendant. Stated differently, while conduct for which a defendant is criminally charged and convicted is necessarily part of the “course of conduct that gives rise to the conviction,” the opposite is also true; conduct for which a defendant is not criminally charged and convicted is necessarily not part of a course of conduct that gives rise to the conviction. Similarly, the statute requires that “any victim” be a victim “of” the defendant's course of conduct giving rise to the conviction, indicating that a victim for whom restitution is assessed need also have a connection to the course of conduct that gives rise to the conviction. Allowing restitution to be assessed for uncharged conduct reads the phrase “that gives rise to the conviction” out of the statute by permitting restitution awards for “any victim of the defendant's course of conduct” without any qualification.
The statute, however, provides an explicit qualification that the Gahan Court did not address.
Our reading does not read the phrase “course of conduct” out of the statute, as the dissent asserts. Depending on the nature and circumstances of the offense, a single act of “conduct” may be sufficient to give rise to the offense, or a series of acts—i.e., a “course of conduct”—may be necessary. For example, a defendant may be assessed restitution for a conviction for assault with a deadly weapon for firing a gun at a victim and be required to pay the victim's resulting medical bills, or a defendant may be assessed restitution for a conviction for armed robbery for firing a gun at a victim and taking the victim's money and be required to pay the victim's medical bills and repay the money taken from the victim. The latter example involves a “course of conduct” that gives rise to a conviction, and both the defendant's assault and his theft could result in a restitution award under our decision today.
Our conclusion is further reinforced when the language of MCL 780.766(2) is read in pari materia with other provisions in the Crime Victim's Rights Act, MCL 780.751 et seq.
MCL 780.767, for example, sets forth the factors for consideration and the burden of proof in setting the amount of restitution. MCL 780.767(1) provides that “[i]n determining the amount of restitution to order under [ MCL 780.766], the court shall consider the amount of the loss sustained by any victim as a result of the offense.” (Emphasis added.) Similarly, MCL 780.767(4) provides that “[t]he burden of demonstrating the amount of the loss sustained by a victim as a result of the offense shall be on the prosecuting attorney.” (Emphasis added.) “[T]he offense” in MCL 780.767 can only refer to the offense of which the defendant was convicted, because it is that “offense” that makes him subject to being ordered to pay restitution in the first place. Thus, these provisions further reinforce our conclusion that MCL 780.766(2) requires a direct, causal relationship between the conduct underlying the convicted offense and the amount of restitution to be awarded. See, e.g., Paroline v. United States, 572 U.S. ––––, ––––, 134 S.Ct. 1710, 1720, 188 L.Ed.2d 714 (2014) (“The words ‘as a result of’ plainly suggest causation.”).
“[S]tatutes in pari materia are to be taken together in ascertaining the intention of the legislature, and ... courts will regard all statutes upon the same general subject matter as part of 1 system.” Dearborn Twp. Clerk v. Jones, 335 Mich. 658, 662, 57 N.W.2d 40 (1953).
Because MCL 780.766(2) does not authorize the assessment of restitution based on uncharged conduct, the trial court erred by ordering the defendant to pay $94,431 in restitution to the victims of air conditioner thefts attributed to the defendant by his accomplice but not charged by the prosecution. We therefore vacate that portion of the defendant's judgment of sentence. As this holding makes it unnecessary to address the question whether restitution based on uncharged conduct is unconstitutional under the Sixth Amendment and Apprendi and its progeny, we decline to reach that question.
B. STARE DECISIS
Contrary to the dissent's assertion, we do not “lightly cast aside” our decision in Gahan. Rather, in determining whether to overrule our decision in Gahan, we are mindful of the factors for overruling our prior decisions set forth in Robinson v. Detroit, 462 Mich. 439, 463–468, 613 N.W.2d 307 (2000). Stare decisis is “generally ‘the preferred course’ ” because it “ ‘contributes to the actual and perceived integrity of the judicial process.’ ” Id. at 463, 613 N.W.2d 307, quoting Hohn v. United States, 524 U.S. 236, 251, 118 S.Ct. 1969, 141 L.Ed.2d 242 (1998). We consider whether Gahan was wrongly decided, whether it defies practical workability, whether reliance interests would work an undue hardship, and whether changes in the law or the facts no longer justify the questioned decision. Id. at 464, 613 N.W.2d 307.
We have little difficulty concluding that Gahan was wrongly decided. For reasons previously explained, we believe that the Gahan Court's analysis of MCL 780.766(2) is incomplete because it failed to consider the clause “that gives rise to the conviction.” That significant qualification to the phrase “course of conduct” renders untenable the Gahan Court's conclusion that the term “course of conduct” should be given a reading so broad that it includes uncharged conduct. This factor weighs in favor of overruling Gahan.
We see no basis for concluding that Gahan defies practical workability. Trial courts hold hearings and make restitution determinations every day under the Gahan Court's reading of the statute, and we see nothing to indicate that Gahan is difficult to apply. This factor weighs in favor of retaining Gahan.
Regarding reliance, we inquire “whether the previous decision has become so embedded, so accepted, so fundamental, to everyone's expectations that to change it would produce not just readjustments, but practical real-world dislocations.” Robinson, 462 Mich. at 466, 613 N.W.2d 307. We conclude that the reliance interests of crime victims are not implicated here because “to have reliance the knowledge must be of the sort that causes a person or entity to attempt to conform his conduct to a certain norm before the triggering event.” Id. at 467, 613 N.W.2d 307. Under MCL 780.766(2), the “triggering event” is the defendant's commission of a crime against a victim for which the defendant is not charged; before that act occurs, a person would have no reason to believe he or she would be victimized and adjust his or her conduct accordingly, so by definition there can be no reliance on the Gahan rule that he or she may recover restitution for his or her losses as a result of that crime.
Further, when dealing with an issue of statutory interpretation, we have said that “it is to the words of the statute itself that a citizen first looks for guidance in directing his actions.” Id. Accordingly, when a court misconstrues or misreads a statute, “it is that court itself that has disrupted the reliance interest. When that happens, a subsequent court, rather than holding to the distorted reading because of the doctrine of stare decisis, should overrule the earlier court's misconstruction.” Id. Because Gahan interpreted only one phrase in MCL 780.766(2), and in doing so did not address another phrase in the statute, we conclude that reliance on its holding is not justified. Because overruling Gahan will not result in practical, real-world dislocations, this factor weighs in favor of its overruling.
Finally, we are aware of no intervening changes in the law or the facts involving restitution awards that would either support or undermine our statutory interpretation analysis in Gahan.
Thus, this factor neither supports nor weighs against overruling Gahan.
Because we do not reach the defendant's constitutional challenge to the restitution award based on Apprendi and its progeny, we do not consider the impact of those cases in our analysis of this factor.
In sum, we conclude that Gahan was wrongly decided and that no reliance interests are upset by its overruling. Stare decisis is a “ ‘principle of policy’ rather than ‘an inexorable command,’ ” and we are not constrained to follow precedent that is badly reasoned. Id. at 464, 613 N.W.2d 307, quoting Hohn, 524 U.S. at 251, 118 S.Ct. 1969. Accordingly, we conclude that Gahan should be overruled to the extent that it held that MCL 780.766(2) “authorizes the sentencing court to order criminal defendants to pay restitution to all victims, even if those specific losses were not the factual predicate for the conviction.” Gahan, 456 Mich. at 270, 571 N.W.2d 503.
IV. CONCLUSION
We hold that MCL 780.766(2) does not authorize trial courts to impose restitution based solely on uncharged conduct. We overrule our decision in Gahan to the extent that it held to the contrary. Therefore, we vacate the portion of the judgment of sentence imposing $158,180.44 in restitution and remand to the trial court for entry of an order assessing $63,749.44 in restitution against the defendant. YOUNG, C.J., MARKMAN, KELLY, ZAHRA, and VIVIANO, JJ., concurred with McCORMACK, J.
MICHAEL F. CAVANAGH, J. (dissenting).
This Court granted leave to appeal, in part, to address whether “Michigan's statutory restitution scheme is unconstitutional insofar as it permits the trial court to order restitution based on uncharged conduct that was not submitted to a jury or proven beyond a reasonable doubt.” People v. McKinley, 495 Mich. 897, 839 N.W.2d 201 (2013), citing People v. Gahan, 456 Mich. 264, 571 N.W.2d 503 (1997). As our grant order illustrates, questions regarding the constitutionality of Michigan's restitution scheme have arisen since the Legislature's enactment of MCL 780.766(2) and after Gahan was decided. The majority, however, ultimately declines to address the limited issue on which this Court granted leave to appeal, instead finding dispositive an issue neither raised nor briefed by the parties—whether Gahan correctly interpreted MCL 780.766(2). I disagree with the majority's characterization of Gahan as “badly reasoned,” but I also object to the majority's decision to lightly cast aside a unanimous opinion of this Court in disregard of a fundamental premise of our adversarial system of adjudication in which each party is given a full and fair opportunity to be heard. See NASA v. Nelson, 562 U.S. 134, 131 S.Ct. 746, 756 n. 10, 178 L.Ed.2d 667 (2011). Because I believe that Gahan was correctly decided, I must respectfully dissent.
I. BACKGROUND: PEOPLE V. GAHAN
The majority opinion gives little attention and weight to Gahan's actual analysis. Accordingly, a brief overview of Gahan is necessary.
In Gahan, a defendant sold motor vehicles on consignment at his used car lot, repeatedly telling his customers that their cars sold for less than the true amount of the sale and keeping the difference for himself. The defendant perpetrated this scheme on numerous individuals, ultimately leading to the defendant's conviction of one count of embezzlement regarding a victim who was swindled out of $1,100. Gahan, 456 Mich. at 265–267, 571 N.W.2d 503.
After the defendant was convicted, a probation officer prepared a presentence investigation report quoting an investigator as saying that the prosecution “ ‘originally had 48 counts against the defendant involving transactions ... that went on for over a year.’ ” Id. at 268, 571 N.W.2d 503. In order to compensate all known victims, the probation officer recommended that the defendant be ordered to pay restitution in an amount of more than $28,000, which the trial court subsequently adjusted to $25,000 in its order of restitution. Id. at 268–269, 571 N.W.2d 503.
The defendant also pleaded guilty to one count of embezzlement involving another victim in a separate proceeding. Gahan, 456 Mich. at 267 n. 3, 571 N.W.2d 503.
The Court of Appeals vacated the order of restitution in a split decision, with the majority concluding that, under the plurality opinion of People v. Becker, 349 Mich. 476, 486, 84 N.W.2d 833 (1957), “a defendant can be ordered to pay restitution only to the victim(s) of the crime(s) for which he is convicted.” People v. Gahan, unpublished opinion per curiam of the Court of Appeals, issued January 16, 1996 (Docket No. 172159), p 5. The Court of Appeals majority reasoned that, although there were similarities between the defendant's crime and the other acts, the defendant was neither tried for nor convicted of the other acts and, thus, the other acts were related to transactions that were independent from the single transaction that provided the factual basis for the conviction. Stated another way, the majority of the panel held that the other acts were not part of the “course of conduct that gave rise to this conviction.” Id. The Court of Appeals dissent disagreed, explaining that MCL 780.766(2), part of the Crime Victim's Rights Act, requires that a court order “ ‘that the defendant ... make restitution to any victim of the defendant's course of conduct that gives rise to a conviction,’ ” with a “victim” defined by MCL 780.766(1) as “ ‘an individual who suffers direct ... financial ... harm as a result of the commission of a crime.’ ” Gahan, unpub. op. at 1 (Smolenski, J., concurring in part and dissenting in part). On this basis, the Court of Appeals dissent explained that the victims of uncharged conduct were “also victims of the commission of a crime, i.e., defendant's other acts of commercial fraud,” and “[t]hese persons were also victims of defendant's course of conduct, i.e., his commercial fraud, that gave rise to a conviction, i.e., his conviction in this case.” Id.
In Gahan, we granted leave to appeal to consider whether MCL 780.766(2) permits a sentencing court to “order a defendant to pay restitution to compensate all the victims who were defrauded by [the defendant's] criminal course of conduct, even though the specific criminal acts committed against some ... victims were not the [factual predicate for] the defendant's conviction.” Gahan, 456 Mich. at 265, 571 N.W.2d 503. See, also, id. at 269–270, 571 N.W.2d 503. After full briefing and oral argument, this Court unanimously concluded that it does. Id. at 270, 571 N.W.2d 503.
In reaching our conclusion, we stated that the statute applicable at the time was clear that “restitution may be ordered with respect to ‘ any ’ victim” as defined by the act. Id. at 271, 571 N.W.2d 503 (emphasis added).
Considering the phrase “course of conduct,” this Court explained that the phrase had acquired a unique meaning at common law before the enactment of the Crime Victim's Rights Act, MCL 780.751 et seq. Specifically, we explainedthat the phrase “course of conduct” originated in cases involving the proper scope of restitution ordered under MCL 771.3 as a condition of probation. Under that statute, which provided that a court may require a probationer to “[p]ay restitution to the victim,” defendants generally had argued that restitution was limited to those “losses attributable to the specific charges that resulted in the defendant's conviction.” Gahan, 456 Mich. at 271, 571 N.W.2d 503. We noted, however, that panels of the Court of Appeals had repeatedly rejected this argument. Specifically, the Court of Appeals had held that restitution orders requiring a defendant to pay a restitution amount exceeding the losses attributable to the specific charges resulting in the conviction were appropriate because “principles of justice required that the defendant ‘pay back the entire amount obtained by his course of criminal conduct.’ ” Id. at 272, 571 N.W.2d 503, quoting People v. Seda–Ruiz, 87 Mich.App. 100, 103, 273 N.W.2d 602 (1978). Because the phrase “course of conduct” had developed a unique meaning at common law, this Court held that the common-law meaning of the phrase should be carried over into the Crime Victim's Rights Act, absent an indication of a contrary legislative intent. Gahan, 456 Mich. at 272, 571 N.W.2d 503. Finding no such indication, this Court held that the Legislature did not intend to deviate from prior caselaw holding that a defendant should be required to compensate for all losses attributable to his illegal scheme “culminat[ing] in his conviction,” even if some of the losses did not form the factual basis of the charge resulting in conviction. Id.
After the defendant's conviction in Gahan, the Legislature amended the Crime Victim's Rights Act to “require, rather than permit, that restitution be ordered.” Gahan, 456 Mich. at 270 n. 6, 571 N.W.2d 503. Specifically, MCL 780.766 now provides, in relevant part:
(1) As used in this section only, “victim” means an individual who suffers direct or threatened physical, financial, or emotional harm as a result of the commission of a crime....
(2) ... [W]hen sentencing a defendant convicted of a crime, the court shall order, in addition to or in lieu of any other penalty authorized by law or in addition to any other penalty required by law, that the defendant make full restitution to any victim of the defendant's course of conduct that gives rise to the conviction....
Gahan explained that “totally dissimilar crimes committed at different times may not satisfy the statutory ‘course of conduct’ requirement,” but such facts were not presented in Gahan. Thus, the Court declined to define the exact parameters of that phrase, noting that the defendant's repeated scheme of defrauding his customers in the same or similar manner clearly fell within the confines of that phrase as developed in previous caselaw. Id. at 273 n. 11, 571 N.W.2d 503. Accordingly, Gahan reversed the Court of Appeals and reinstated the order of restitution. Id. at 277–278, 571 N.W.2d 503.
This Court also compared the broader statutory language from MCL 780.766(2) with federal caselaw interpreting a federal restitution statute. Gahan, 456 Mich. at 271 n. 8, 571 N.W.2d 503. Specifically, unlike its federal counterpart, MCL 780.766(2) does not limit restitution to the offense of conviction by providing that, “when sentencing a defendant convicted of an offense,” a court “may order ... that the defendant make restitution to any victim of such offense[.]” 18 U.S.C. § 3663(a)(1)(A) (emphasis added). See, also, Gahan, 456 Mich. at 271 n. 8, 571 N.W.2d 503.
II. ANALYSIS
At issue is whether the majority is correct that Gahan is an “untenable,” “badly reasoned,” and “plainly incomplete” opinion that “ignored” the language of the statute. Despite the majority's bold characterizations of Gahan's analysis, I continue to believe that Gahan correctly interpreted the plain language of the statute at issue.
As the above background illustrates, this Court was not presented with a novel issue in Gahan. Dating back to the late 1960s, panels of the Court of Appeals have been asked to address the proper scope of restitution orders in light of arguments from defendants, like the defendant in Gahan, that this Court's plurality opinion in Becker and the applicable statutory language limited restitution orders to only those losses attributable to the specific charges or transaction that resulted in a conviction. See, e.g., People v. Nawrocki, 8 Mich.App. 225, 227, 154 N.W.2d 45 (1967) (upholding an order of probation that required a defendant to pay restitution for forged checks in addition to the forged check for which he was convicted of uttering and publishing).
Notably, in People v. Gallagher, 55 Mich.App. 613, 223 N.W.2d 92 (1974), the Court of Appeals addressed whether MCL 771.3 authorized restitution “ ‘only as to loss caused by the very offense for which [the] defendant was tried and convicted,’ ” as argued by the defendant. Gallagher, 55 Mich.App. at 617–618, 223 N.W.2d 92, quoting Becker, 349 Mich. at 486, 84 N.W.2d 833. At the time, MCL 771.3 provided that, as a condition of probation, a court could order restitution “ ‘in whole or in part to the person or persons injured or defrauded, as the circumstances of the case may require or warrant, or as in its judgment may be meet and proper.’ ” Gallagher, 55 Mich.App. at 618, 223 N.W.2d 92, quoting MCL 771.3. Agreeing with Nawrocki that the statutory language authorized restitution for losses exceeding those that formed the factual basis for the conviction, Gallagher rejected the defendant's reliance on Becker, which, after a review of federal authority, concluded that restitution ordered under MCL 771.3 could only be imposed for offenses for which the defendant was convicted. Becker, 349 Mich. at 485–486, 84 N.W.2d 833. See, also, Gallagher, 55 Mich.App. at 618, 223 N.W.2d 92. Gallagher explained that not only was Becker nonbinding but, in enacting MCL 771.3, the Michigan Legislature did not choose to follow the narrower federal approach, Gallagher, 55 Mich.App. at 618, 223 N.W.2d 92, which limited restitution to “ ‘aggrieved parties for actual damages or loss caused by the offense [for] which conviction was had,’ ” United States v. Hoffman, 415 F.2d 14, 21 (C.A.7, 1969), quoting 18 U.S.C. § 3651. Rather, Gallagher held that Michigan's broadly worded restitution statute was similar to those of other states insofar as the Michigan statute “permit[ted] restitution of the whole loss caused by a course of criminal conduct upon conviction of a crime arising out of that conduct.” Gallagher, 55 Mich.App. at 618, 223 N.W.2d 92, citing People v. Dawes, 132 Ill.App.2d 435, 270 N.E.2d 214 (1971) (upholding a restitution order as to the single complainant, but also as to other victims of the defendant's conduct that were subsequently discovered).
Later panels of the Court of Appeals applied Gallagher's interpretation of MCL 771.3, holding that the statute permitted restitution to all victims of a defendant's course of conduct, even if the victim's specific losses did not form the factual basis of the defendant's conviction. See Seda–Ruiz, 87 Mich.App. at 102–103, 273 N.W.2d 602 (rejecting a challenge to a restitution order on the ground that it was unlawful for the defendant to be required to pay back amounts for other losses not mentioned in the specific charges for which the defendant was convicted);
People v. Pettit, 88 Mich.App. 203, 205–206, 276 N.W.2d 878 (1979) (quoting and agreeing with Gallagher that restitution may be imposed under MCL 771.3 for the “ ‘whole loss caused by a course of criminal conduct upon conviction of a crime arising out of that conduct’ ”); People v. Alvarado, 142 Mich.App. 151, 162, 369 N.W.2d 462 (1984), disapproved on other grounds People v. Music, 428 Mich. 356, 408 N.W.2d 795 (1987) (same). Although some panels of the Court of Appeals applied the Becker plurality to limit restitution to only those losses caused by the very offense for which the defendant was tried and convicted, see, e.g., People v. Blaney, 139 Mich.App. 694, 363 N.W.2d 13 (1984), at the time the Crime Victim's Rights Act was enacted, the weight of authority allowed restitution ordered as a condition of probation for losses exceeding the losses attributable to the specific charges that resulted in a defendant's conviction.
In Seda–Ruiz, the Court of Appeals remanded to the trial court for an evidentiary hearing to address the defendant's argument that he was not given the opportunity to examine all of the checks that were the subject of the restitution order and that some of the checks for which he was required to pay restitution were “not his checks.” Seda–Ruiz, 87 Mich.App. at 104, 273 N.W.2d 602. The majority states that the concurring opinion in Seda–Ruiz, which agreed with the decision to remand but would have additionally limited restitution to only those checks for which the defendant had pleaded guilty or which were part of the plea agreement, id. at 105, 273 N.W.2d 602, suggests that Gallagher's interpretation of the proper scope of restitution was in dispute. Although some jurists, such as the concurring author in Seda–Ruiz, may have disagreed with Gallagher's nonbinding interpretation of the proper scope of restitution under MCL 771.3, see MCR 7.215(J)(1), it does not follow that the meaning of the phrase “course of conduct” as used by Gallagher to describe the scope of restitution under MCL 771.3 was unsettled at the time of the Crime Victim's Rights Act's enactment, especially in light of Gallagher's clear rejection of the proposition that MCL 771.3 limited restitution to only those losses caused by the offense for which the defendant was convicted.
In fact, after the Crime Victim's Rights Act was enacted, panels of the Court of Appeals continued to apply Gallagher's interpretation to MCL 769.1a, Michigan's similarly worded general restitution statute, as well as MCL 780.766(2), noting that the language adopted by the Legislature was essentially identical to that employed by prior Court of Appeals opinions interpreting MCL 771.3. See, e.g., People v. Littlejohn, 157 Mich.App. 729, 403 N.W.2d 215 (1987); People v. Bixman, 173 Mich.App. 243, 433 N.W.2d 417 (1988); People v. Greenberg, 176 Mich.App. 296, 439 N.W.2d 336 (1989); People v. Persails, 192 Mich.App. 380, 481 N.W.2d 747 (1991); People v. Letts, 207 Mich.App. 479, 525 N.W.2d 171 (1994).
With this expanded historical backdrop in mind, I continue to believe that Gahan correctly determined that the phrase “course of conduct” in the Crime Victim's Rights Act should be given a broad construction consistent with its unique meaning at common law. As this Court has repeatedly stated, “[i]t is a well-established principle of statutory construction that the Legislature is presumed to act with knowledge of statutory interpretations by the Court of Appeals and this Court.” Gordon Sel–Way, Inc. v. Spence Bros., Inc., 438 Mich. 488, 505–506, 475 N.W.2d 704 (1991). Thus, the Legislature is “deemed to act with an understanding of common law in existence before ... legislation ... [is] enacted.” Nation v. W. D. E. Electric Co., 454 Mich. 489, 494, 563 N.W.2d 233 (1997) (emphasis added). “This Court will [also] presume that the Legislature ... is familiar with the principles of statutory construction,” People v. Hall, 391 Mich. 175, 190, 215 N.W.2d 166 (1974), particularly the notion that words and phrases that have acquired a unique meaning in the common law are interpreted as having the same meaning when they appear in later enacted statutes dealing with the same subject matter “unless a contrary intent is plainly shown,” People v. Covelesky, 217 Mich. 90, 100, 185 N.W. 770 (1921). See, also, Pulver v. Dundee Cement Co., 445 Mich. 68, 75, 515 N.W.2d 728 (1994); MCL 8.3a. In other words, in keeping with the canons of statutory interpretation, the Legislature is presumed to have known the meaning of “course of conduct” as it relates to restitution when it enacted the Crime Victim's Rights Act.
It bears emphasizing that, despite conflicting opinions of the Court of Appeals regarding the applicability of the Becker plurality and the proper scope of restitutionordered as a condition of probation, the Legislature nevertheless incorporated a restitution provision into the Crime Victim's Rights Act substantially mirroring the language of Gallagher and its progeny.
In light of the well-established use of the phrase “course of conduct” to broadly define the scope of restitution orders imposed as a condition of probation, Gahan was correct that “there was no indication from the Legislature that the common-law meaning was not being incorporated” into the subsequently enacted Crime Victim's Rights Act. Gahan, 456 Mich. at 272, 571 N.W.2d 503. Indeed, given the Legislature's knowledge of existing precedent at the time of the Crime Victim's Rights Act's enactment in 1985, see Nation, supra, I cannot conclude that the Legislature's selection of the phrase “course of conduct” within MCL 780.766(2) “plainly shows” a legislative intent to incorporate something other than the phrase's common-law meaning, see Covelesky, supra. Had the Legislature wished to give MCL 780.766(2) the narrow meaning the majority opinion gives it today, the Legislature could have instead defined the scope of a restitution order under MCL 780.766(2) in a manner that was consistent with the federal statutes discussed in Gallagher, 55 Mich.App. at 619, 223 N.W.2d 92, and Becker, 349 Mich. at 485–486, 84 N.W.2d 833. Indeed, the Legislature is deemed to be aware of this Court's plurality decision in Becker, yet the Legislature did not limit restitution consistent with that opinion to only those “loss[es] caused by the very offense for which [the] defendant was tried and convicted”, Becker, 349 Mich. at 486–, 84 N.W.2d 833a proposition continuously advocated for by defendants decades before the Crime Victim's Rights Act's enactment. Instead, the Legislature chose the broader phrase—“course of conduct that gives rise to a conviction”—which was consistent with Court of Appeals caselaw rejecting Becker.
Compare Gahan, 456 Mich. at 270, 571 N.W.2d 503 (emphasis added) (noting that MCL 780.766(2) provided that a trial court may order that the defendant make restitution to “any victim of the defendant's course of conduct which gives rise to the conviction ”), with Gallagher, 55 Mich.App. at 618, 223 N.W.2d 92 (emphasis added) (interpreting MCL 771.3 as permitting restitution for “the whole loss caused by a course of criminal conduct upon conviction of a crime arising out of that conduct ”). Notably, MCL 771.3 was subsequently amended to include a phrase nearly identical to the phrase at issue in this case, illustrating the Legislature's intent to codify Gallagher's, rather than Becker's, interpretation of the proper scope of a restitution order under MCL 771.3. See 1993 PA 343; MCL 771.3(1)(e).
That MCL 771.3 was subject to varying interpretations does not undermine Gahan's interpretation of MCL 780.766(2), as the majority states. As previously noted, the Legislature is presumed to act with knowledge of judicial interpretations by this Court and the Court of Appeals, see Ford Motor Co. v. City of Woodhaven, 475 Mich. 425, 439–440, 716 N.W.2d 247 (2006), yet, in defining the scope of restitution under the Crime Victim's Rights Act, the Legislature did not simply incorporate the language of MCL 771.3 into the act. Instead, it selected language mirroring Gallagher's broad interpretation of MCL 771.3, rather than incorporating language similar to decisions that limited restitution under MCL 771.3 to only those losses related to the transaction that formed the factual basis for the conviction. Simply stated, the fact that Gallagher's interpretation of MCL 771.3 was not universally followed is irrelevant in light of the Legislature's awareness of conflicting interpretations of MCL 771.3 and its subsequent choice to incorporate language mirroring Gallagher's “course of conduct” language into the Crime Victim's Rights Act.
I also disagree with the majority that, in determining the Legislature's intent, seven Justices of this Court “ignored” and “devoted no attention to” one phrase within MCL 780.766(2), i.e., that the defendant make restitution to any victim of the defendant's course of conduct “ that gives rise to the conviction.” The majority asserts that, because the phrase “gives rise to” means “to produce or cause,” the statutory language requires a causal link between conduct for which the defendant is criminally charged and the defendant's conviction. Stated another way, the majority reasons that “[o]nly crimes for which a defendant is charged ‘cause’ ... the conviction” and, thus, “conduct for which a defendant is not criminally charged and convicted is necessarily not part of a course of conduct that gives rise to the conviction.” Although I agree with the majority that the statute requires some type of a causal link between a defendant's “course of conduct” and his conviction, I disagree with the majority that the requisite connection necessarily excludes uncharged conduct from the scope of a defendant's “course of conduct.” As Gahan explained, the historical use of the phrase “course of conduct” included uncharged conduct that was related to a defendant's illegal scheme from which the defendant's conviction arose. Thus, the statutorily required causal connection is that a defendant's conviction arises from an illegal scheme. See Gahan, 456 Mich. at 272–273, 571 N.W.2d 503. If that connection exists, a court may order restitution for the commission of related, but uncharged crimes, within that same illegal scheme.
Similarly, Gahan does not permit a restitution award for any victim of a defendant's course of conduct without qualification, as the majority claims. Instead, by requiring that a defendant's conviction must have arisen from a specific “course of conduct,” the Legislature limited the “course of conduct” from which restitution may be ordered. Thus, a defendant cannot be ordered to pay restitution for “totally dissimilar crimes committed at different times,” or those involving an unrelated illegal scheme. Gahan, 456 Mich. at 273 n. 11, 571 N.W.2d 503. Rather, the defendant is only required to compensate for “all the losses attributable to the illegal scheme that [actually] culminated in [the] conviction” that triggered restitution. Id. at 272, 571 N.W.2d 503. As Gahan explained, in order for uncharged conduct to be included within the restitution order, the uncharged conduct must have occurred as part of the same or similar illegal scheme from which the defendant's conviction arose. Gahan, 456 Mich. at 272–273, 571 N.W.2d 503. Accordingly, Gahan properly concluded that the statutory language requires a defendant to provide restitution not only to the victims that are the subject of the very act that results in the defendant's conviction, but also to those harmed by the defendant's related course of criminal conduct from which the defendant's conviction arose. In doing so, Gahan properly gave effect to each word within the statute, while giving the phrase “course of conduct” its unique common-law meaning. In contrast, by holding that only conduct for which a defendant is “charged and convicted is ... part of the ‘course of conduct that gives rise to the conviction ’ ” (emphasis added), the majority reads the phrase “course of conduct” out of the statute, effectively rewriting the statute to limit restitution to only those losses suffered by “victims of the defendant's conduct that results in a conviction.”
I also disagree with the majority's suggestion that Gahan's interpretation of MCL 780.766(2) conflicts with MCL 780.767. MCL 780.767(1) provides that, “[i]n determining the amount of restitution to order under [MCL 780.766], the court shall consider the amount of the loss sustained by any victim as a result of the offense.” The majority concludes that, by referring to “the offense,” MCL 780.767 can “only refer to the offense of which the defendant was convicted, because it is that ‘offense’ that makes him subject to being ordered to pay restitution in the first place.” However, MCL 780.767 can be read harmoniously with Gahan's interpretation of MCL 780.766(2). Notably, it is MCL 780.766(2) that defines the proper scope of the restitution order, explaining that the order shall include losses for any victim of a defendant's “course of conduct that gives rise to the conviction.” Accepting that the phrase “course of conduct” within MCL 780.766(2) includes uncharged conduct that does not form the factual basis for a defendant's conviction, MCL 780.767 merely directs the sentencing court to consider, in determining the amount of restitution to order under MCL 780.766(2), the loss sustained by any victim as a result of an uncharged offense that is a part of the defendant's illegal scheme from which the defendant's conviction arose. To that end, although the issue was not raised by the parties and therefore I do not opine on it, nowhere in the 21 pages of transcript of the restitution hearing did defense counsel contradict the prosecution's evidence regarding the defendant's commission of the uncharged crimes or the amount of restitution assessed for each.
Notably, our grant order in this case assumed that Gahan's statutory interpretation was correct. Yet, despite the interpretation unanimously afforded to the statute's plain language by this Court in Gahan, the majority brushes Gahan aside on the basis of its conclusion that Gahan is so poorly reasoned that it must be overruled without full briefing and oral argument on the issue.
In doing so, the majority ignores that the Legislature has subsequently amended MCL 780.766, but it has not otherwise sought to correct what the majority claims is Gahan's “plainly incomplete” interpretation in the 17 years since Gahan was decided.
The majority guides us astray in suggesting that the parties addressed the validity of Gahan's statutory analysis in their briefs to this Court. In light of this Court's grant order, which limited the issues to be briefed, it is no surprise that the parties did not actually argue whether this Court should overrule Gahan on nonconstitutional statutory interpretation grounds in their briefs, but instead focused solely on the issues raised in this Court's grant order—whether restitution is a criminal penalty and whether, in light of postGahan precedent, Michigan's statutory restitution scheme is unconstitutional insofar as it permits a trial court to order restitution based on uncharged conduct. Further, although one litigant made a single, conclusory comment at oral argument regarding Gahan's interpretation of the statutory language, in my view, that does not substitute for full briefing on the actual substance of Gahan's statutory analysis from both of the parties in this case.
Finally, the majority is correct that I do not reach the constitutional issue on which this Court granted leave to appeal, but it is not because, as the majority suggests, a “constitutional hurdle prove[d] unresolvable to [this] dissent.” Instead, it is precisely because Gahan was correctly decided that I believe that this Court should address the issues upon which it granted leave to appeal, rather than overruling a longstanding and correct determination of the Legislature's intent in enacting the Crime Victim's Rights Act. Nevertheless, because my position has not garnered majority support, I decline to opine on those issues.
Further, in classifying Gahan as an “untenable” opinion that “ignored” the statutory language, the majority fails to appreciate that Gahan was decided after a careful review of a divided Court of Appeals opinion, after full briefing and oral argument, and after post-argument discussions. Thus, in overruling Gahan by finding dispositive an issue neither raised nor briefed by the parties in this case, the majority not only fails to appreciate the thoughtful consideration given to the statutory language by the Gahan Court, but it also fails to consider whether the advocates in this case could have added anything insightful to the newfound debate over the correctness of unanimous precedent.
Quite simply, I disagree with the majority that Gahan was wrongly decided.
It requires no citation to authority to note that the vast majority of convictions in this state result from guilty pleas, many of which are the result of plea negotiations when a prosecutor offers to dismiss some charges if a defendant agrees to plead guilty to others. In light of crime victims' constitutional right to restitution, see Const. 1963, art. 1, § 24, only time will tell the impact of the majority opinion on prosecutorial charging decisions, plea negotiations, and trials.
III. CONCLUSION
Today, the majority holds that seven Justices of this Court ignored a portion of the statute at issue. I disagree with the majority's characterization of Gahan's analysis. But I also disagree with the majority's decision to disregard one of the foundational principles of our adversarial system of justice by failing to give each party an opportunity to be heard in order to assist this Court in understanding the issue before it and prevent a preliminary understanding of the issue from improperly influencing the Court's final decision of an issue that was previously and unanimously decided. Accordingly, I must respectfully dissent.