Opinion
E072744
09-08-2020
THE PEOPLE, Plaintiff and Respondent, v. FINANCIAL CASUALTY & SURETY, INC., Defendant and Appellant.
Law Office of John Rorabaugh, John M. Rorabaugh and Crystal L. Rorabaugh for Defendant and Appellant. Michelle D. Blakemore, County Counsel, S. Mark Strain and Mitchell L. Norton, Deputy County Counsel, for Plaintiff and Respondent.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super.Ct.No. CIVDS1902315) OPINION APPEAL from the Superior Court of San Bernardino County. Donald R. Alvarez, Judge. Affirmed. Law Office of John Rorabaugh, John M. Rorabaugh and Crystal L. Rorabaugh for Defendant and Appellant. Michelle D. Blakemore, County Counsel, S. Mark Strain and Mitchell L. Norton, Deputy County Counsel, for Plaintiff and Respondent.
The People charged Daniel Joe Jamison, Jr., with assault with a deadly weapon and personally inflicting great bodily injury. (Pen. Code, §§ 245, subd. (a)(1), 12022.7, subd. (a).) The court set his bail at $125,000, and Financial Casualty & Surety, Inc. (Surety) posted a bail bond for his release. The court later ordered the bond forfeited and entered summary judgment against Surety.
Surety appeals from the judgment and the order denying its motion to set aside summary judgment, discharge forfeiture, and exonerate the bond. Surety argues that the court's order setting bail was unconstitutional, rendering the bail bond void and the court without jurisdiction to order a forfeiture. We reject Surety's arguments and affirm.
BACKGROUND
Jamison was arraigned in September 2016. He appeared by video from custody, and the court appointed the public defender to represent him. As to bail, the minute order of the arraignment states: "Bail Setting $125,000." The minute order does not identify any court reporter, and Surety asserts that the arraignment was not otherwise recorded. A few days later, Surety posted the $125,000 bail bond for Jamison's release.
In November 2017, Jamison failed to appear for a pretrial hearing. The court ordered the bond forfeited on that date. In January 2019, the People filed a petition for summary judgment on the bond forfeiture, and the court entered judgment against Surety.
Surety moved to set aside summary judgment, discharge forfeiture, and exonerate the bond. It argued that the court failed to comply with constitutional and statutory requirements when setting bail, rendering the bail order void and the forfeiture of the bond unenforceable. The court presumed that the criminal court had followed the law when setting bail (Evid. Code, § 664) and concluded that Surety had not rebutted the presumption. The court therefore denied the motion.
STANDARD OF REVIEW
Ordinarily, we review an order denying a motion to vacate forfeiture or set aside summary judgment for abuse of discretion. (People v. The North River Ins. Co. (2020) 48 Cal.App.5th 226, 232 (North River); People v. International Fidelity Ins. Co. (2012) 204 Cal.App.4th 588, 592.) But where, as here, the facts are undisputed and only legal issues are involved, we conduct an independent review. (People v. International Fidelity Ins. Co., supra, at p. 592.)
DISCUSSION
There are two parts to Surety's argument: (1) The bail setting order was unconstitutional; (2) as a consequence, the bail bond was void, and the court had no jurisdiction to order the bond forfeited. Even if the first part has merit, the second part does not follow.
The California Constitution prohibits excessive bail. (Cal. Const., art. I, §§ 12, 28, subd. (f)(3).) It also provides that in setting bail, the court must consider the seriousness of the offense, the defendant's previous criminal record, the probability of the defendant appearing at trial or hearings, public safety, and the safety of the victim. (Ibid.) Whether the court grants or denies bail or releases the defendant on his or her own recognizance, "the reasons for that decision shall be stated in the record and included in the court's minutes." (Cal. Const., art. I, § 28, subd. (f)(3).) Additionally, in In re Humphrey, the First District Court of Appeal held that as a matter of due process and equal protection, the trial court must consider the defendant's ability to pay when setting bail. (In re Humphrey (2018) 19 Cal.App.5th 1006, 1037, review granted May 23, 2018, S247278 (Humphrey).) If the amount of bail required to ensure the defendant's appearance is beyond the defendant's financial means, the court may impose that amount only if it finds, by clear and convincing evidence, that no less restrictive conditions will ensure the defendant's appearance. (Ibid.)
Our Supreme Court is reviewing this issue and others in Humphrey. (In re Humphrey (2018) 233 Cal.Rptr.3d 129 .)
The statutory scheme governing bail requires the court to consider the non-Humphrey factors when setting bail (Pen. Code, § 1275, subd. (a)(1); unlabeled statutory citations refer to this code), but the scheme also directs the superior court judges in each county to adopt a uniform countywide schedule of bail based solely on the seriousness of the offense charged (§ 1269b, subds. (c), (e)). The statutes require the court to explain and record its reasons for the bail amount only if it departs from the bail schedule in certain enumerated cases. (§§ 1270.1, subd. (d), 1275, subd. (c); Humphrey, supra, 19 Cal.App.5th at pp. 1024, 1038 & fn. 17.)
California's money bail system might be replaced by a new system requiring risk assessment services and own recognizance release or detention. (Stats. 2018, ch. 244, §§ 3, 4, Sen. Bill No. 10 (2017-2018 Reg. Sess.).) The new legislation repealing the existing bail statutes and replacing them with the risk assessment system was supposed to take effect on October 1, 2019. (§§ 1320.6, 1320.34.) "Following its enactment, this legislation was suspended pursuant to a referendum petition. Now, it will only be effective if approved as a referendum measure at the November 2020 election." (In re Webb (2019) 7 Cal.5th 270, 274; see https://www.sos.ca.gov/elections/ballot-measures/qualified-ballot-measures.) --------
Surety argues that the bail order was unconstitutional primarily because the court did not record its reasons for setting bail in the amount of $125,000. According to Surety, the record thus fails to reflect whether the court considered relevant factors like Jamison's flight risk, the risk that he posed to the public, or his ability to pay. And if the court set bail merely by consulting the bail schedule, Surety argues that the court failed to consider Jamison's individualized circumstances.
Assuming for the sake of argument that the court acted unconstitutionally by failing to record its reasons, we conclude that such a constitutional infirmity in the bail order does not render the bond void or the court without jurisdiction to enforce the bond. A bail bond constitutes a contract between the surety and the government. (People v. American Contractors Indemnity Co. (2004) 33 Cal.4th 653, 657.) The government and the surety agree that if the government releases the defendant from custody, the surety will guarantee the defendant's appearance in court. (People v. Financial Casualty & Surety, Inc. (2019) 39 Cal.App.5th 1213, 1225.) If the defendant fails to appear, the surety becomes liable to the government for the amount of the bond. (Ibid.)
"While bail bond proceedings occur in connection with criminal prosecutions, they are independent from and collateral to the prosecutions and are civil in nature." (People v. American Contractors Indemnity Co., supra, 33 Cal.4th at p. 657.) "The independence of bail proceedings from the underlying criminal prosecution" means that any noncompliance with constitutional mandates "during the prosecution does not affect—let alone eviscerate—the trial court's jurisdiction over the collateral bail proceedings." (North River, supra, 48 Cal.App.5th at p. 235.)
Thus, "[t]ime and again, courts have ruled that errors in a trial court's setting of bail during the criminal prosecution do not let the surety off the hook in the collateral bail proceedings." (North River, supra, 48 Cal.App.5th at p. 235.) For instance, in People v. Accredited Surety & Casualty Co. (2019) 34 Cal.App.5th 891 (Accredited 2019), one of our sister courts rejected a Humphrey challenge to the bond's validity. (Id. at pp. 897-899.) The court assumed that the trial court had violated the defendant's constitutional rights by setting bail without considering the Humphrey factors. (Id. at p. 897.) Nevertheless, that violation did not void the bail bond, because the surety "waived any procedural irregularities in the bail setting hearing when it 'assume[d] its obligations . . . at the time of the execution of the bond.'" (Id. at p. 898.) Moreover, the court reasoned, Humphrey's procedural requirements safeguard the defendant's constitutional rights, not any rights of the surety. (Id. at p. 899.) The procedural requirements governing forfeiture and exoneration of the bond (§§ 1305, 1306) protect the surety. (Accredited 2019, supra, at p. 899.) But the failure to comply with procedural requirements in setting bail are not among the statutory grounds for exonerating the bond or setting aside forfeiture. (Ibid.; see also People v. Financial Casualty & Surety, Inc. (2019) 39 Cal.App.5th 1213, 1217, 1226-1227 [court's unconstitutional bail condition (requiring the defendant to waive his Fourth Amendment rights while released on bail) did not void the surety's obligation under the bond]; People v. Accredited Surety & Casualty Co., Inc. (2004) 125 Cal.App.4th 1, 6-8 [court's failure to comply with statutory requirements in setting bail did not exonerate the bond or provide a defense to forfeiture of the bond].)
In short, a claimed violation of Jamison's rights in setting bail does not permit Surety to void the bond—a contract between Surety and the government. Surety's arguments to the contrary lack merit.
Surety relies on a host of cases purportedly holding "that where a bond is not posted in accordance with a lawful court order the bond is void and unenforceable." None of those cases stands for that broad proposition, and all of the cases are distinguishable. Many of the cases involve defects in the contract between the surety and the government that rendered the contract void or enforceable. But those defects are not present here. (People v. Accredited Surety & Casualty Co. (2012) 209 Cal.App.4th 617, 622 [bond void for failure of consideration where the defendant was not in actual custody and therefore not released from custody in exchange for the surety's guarantee], disapproved in part by County of Los Angeles v. Financial Casualty & Surety, Inc. (2018) 5 Cal.5th 309, 318, fn. 5; People v. International Fidelity Ins. Co. (2012) 204 Cal.App.4th 588, 594-595 [bond void because part of the consideration offered to the surety—a bond issued by a second surety—was invalid]; People v. Lexington National Ins. Corp. (2015) 242 Cal.App.4th 1098, 1105 [court's unilateral change to terms of the contract by increasing amount of bail after bond was posted rendered bond void]; County of Merced v. Shaffer (1919) 40 Cal.App. 163, 168 [bond executed by two individuals could not be enforced against them because they did not actually agree to pay anything under the terms of the bond].)
Several of the other cases are irrelevant to the issues before us. (Kiperman v. Klenshetyn (2005) 133 Cal.App.4th 934, 939-940 [court erred by requiring the surety to return the defendant's premium on two bonds]; Coburn v. Townsend (1894) 103 Cal. 233, 235 [bond posted in condemnation proceeding was void because the condemnation proceeding was unconstitutional].)
And still more of the cases address a fundamental lack of authority to order bail or an underlying order that was absolutely void. (San Francisco v. Hartnett (1905) 1 Cal.App. 652, 653, 656 [bond was void because amount of bail was fixed not by the court but by a clerk who lacked authority to do so]; Taylor v. Exnicious (1925) 197 Cal. 443, 445-446 [court had no jurisdiction to appoint a receiver and require a receiver's bond, so the order appointing the receiver and the receiver's bond were void].) Those cases do not assist Surety either. Even if the trial court failed to state its reasons for the bail amount or failed to consider relevant factors, it fundamentally had jurisdiction over the criminal case and Jamison, so the court's bail order was not absolutely void. (North River, supra, 48 Cal.App.5th at p. 233 [distinguishing between a lack of fundamental jurisdiction over subject matter, question presented, or party, and an act merely in excess of the court's defined power].) At most, the bail order was voidable by Jamison, had he chosen to challenge it by writ petition or otherwise. (Id. at p. 235 [any noncompliance with Humphrey in setting bail "render[ed] the bail order voidable as to the defendant, not as to the surety"].)
Surety presents one additional argument for setting aside the summary judgment. Surety recognizes the contractual nature of its obligation and argues that the amount of the bond is a liquidated damages provision, insofar as it fixes the amount to be paid to the government upon breach of the contract. On that basis, Surety argues that liquidated damages must be reasonable under the circumstances when the contract was formed, which in the bail context means the minimum amount necessary to incentivize the defendant to appear. Surety suggests that the liquidated damages—that is, the bail amount—were not reasonable and thus are unenforceable. But the authorities on which Surety relies do not support that conclusion.
First, Surety relies on inapposite Ninth Circuit case law. Under Ninth Circuit law, the court considers six nonexclusive factors in deciding whether to set aside or remit the forfeiture of a bond. (United States v. Nguyen (9th Cir. 2002) 279 F.3d 1112, 1115-1116 (Nguyen); United States v. Amwest Sur. Ins. Co. (9th Cir. 1995) 54 F.3d 601, 603 (Amwest).) One of those factors is "the appropriateness of the amount of the bond." (Nguyen, supra, at p. 1116; Amwest, supra, at p. 603.) Nguyen and Amwest described the bond as functioning like liquidated damages and explained that it "must be reasonable when set," but that was in the context of considering whether the bond amount was appropriate. (Nguyen, at p. 1117; Amwest, at p. 604.) Surety does not identify any California law permitting the surety to set aside a forfeiture because the bond amount was inappropriate. Nor are we aware of any.
Second, Surety relies on Civil Code section 1671, which is no more helpful. Section 1671 applies to contracts generally and states that the party seeking to invalidate a liquidated damages provision must establish "that the provision was unreasonable under the circumstances existing at the time the contract was made." (Civ. Code, § 1671, subd. (b).) The statute "gives the parties considerable leeway in determining the damages for breach." (Cal. Law Revision Com. com., Deering's Ann. Civ. Code (1977) foll. § 1671.) The factors that determine whether liquidated damages are reasonable include "the relationship that the damages . . . bear to the range of harm that reasonably could be anticipated," "the relative equality of the bargaining power of the parties, whether the parties were represented by lawyers at the time the contract was made, the anticipation of the parties that proof of actual damages would be costly or inconvenient, the difficulty of proving causation and foreseeability, and whether the liquidated damages provision is included in a form contract." (Ibid.) Surety does not even mention those various factors, much less show how they invalidate the bail contract between it and the government.
Third, Surety relies on consumer case law that has no application in this context. Specifically, Surety asserts that "the bail amount must be set in an amount based on a 'reasonable endeavor' to calculate the actual damages contemplated for the breach." The reasonable endeavor test applies to liquidated damages in consumer contracts and residential leases. (Civ. Code, § 1671, subds. (c), (d); Cellphone Termination Fee Cases (2011) 193 Cal.App.4th 298, 321-322.) The bail bond is not a consumer contract or lease.
For all of these reasons, the court properly denied Surety's motion to set aside summary judgment, discharge forfeiture, and exonerate the bond.
DISPOSITION
The order and judgment are affirmed.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS.
MENETREZ
J. We concur: MILLER
Acting P. J.
RAPHAEL
J.