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stating that a deed altered without authority, prior to delivery or recording, is void
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C082057
11-08-2019
The PEOPLE, Plaintiff and Respondent, v. Lonnie Glenn SCHMIDT, Defendant and Appellant.
Laura Schaefer, San Diego, under appointment by the Court of Appeal, for Defendant and Appellant. Xavier Becerra, Attorney General, Gerald A. Engler, Chief Assistant Attorney General, Michael P. Farrell, Assistant Attorney General, Julie A. Hokans, Galen N. Farris, Deputy Attorney General, for Plaintiff and Respondent.
Certified for Partial Publication.
Pursuant to California Rules of Court, rules 8.1105 and 8.1110, the majority opinion is certified for publication with the exception of parts A, B, D, E, F, G, H, I, J, K, L, and M of section II. The minority opinion is not certified for publication.
Laura Schaefer, San Diego, under appointment by the Court of Appeal, for Defendant and Appellant.
Xavier Becerra, Attorney General, Gerald A. Engler, Chief Assistant Attorney General, Michael P. Farrell, Assistant Attorney General, Julie A. Hokans, Galen N. Farris, Deputy Attorney General, for Plaintiff and Respondent.
RENNER, J. Following a lengthy jury trial in which he represented himself, defendant Lonnie Glenn Schmidt was convicted of four counts of prohibited practices by a foreclosure consultant (counts 1-2, 29-30— Civ. Code, § 2945.4, subds. (a) and (e) ), 10 counts of filing false instruments (counts 3, 4, 6, 8, 10, 12, 13, 15, 18, 26— Pen. Code, § 115, subd. (a) ), six counts of identity theft (counts 5, 7, 9, 11, 14, 16—§ 530.5, subd. (a)), one count of second degree burglary (count 17—§ 459), one count of perjury (count 19—§ 118, subd. (a)), three counts of grand theft (counts 20, 27-28—§ 487, subd. (a)), and five counts of attempted grand theft (counts 21 to 25; §§ 664, 487, subd. (a)). The trial court sentenced defendant to a total of 28 years in state prison plus one year consecutive in the county jail.
Undesignated statutory references are to the Penal Code.
On appeal, defendant argues, and the People concede, that: (1) insufficient evidence supports the convictions for violations of Civil Code section 2945.4, subdivisions (a) and (e) in counts 29 and 30, and (2) the grand theft convictions on counts 20 or 21, on the one hand, and 27 or 28 on the other, are barred by the multiple takings doctrine set forth in People v. Bailey (1961) 55 Cal.2d 514, 518-519, 11 Cal.Rptr. 543, 360 P.2d 39 ( Bailey ). We accept the People's concessions and shall reverse the convictions on counts 20, 28, 29, and 30.
Defendant also argues that the evidence does not support the convictions for violations of section 115, subdivision (a) in counts 3 and 26. We agree and shall reverse the convictions on counts 3 and 26 as well.
Defendant also argues the trial court should have stayed his sentence on counts 17, 20 to 25, and 27 to 28. The People concede that the sentence should have been stayed on count 21. We accept the concession and remand for resentencing on count 21. We reject defendant's contention that the sentence should have been stayed on the other enumerated counts.
Defendant also argues, and the People also concede, that the trial court erred in reducing the conviction for second degree burglary in count 17 to misdemeanor shoplifting under Proposition 47, and sentencing him to one year consecutive, rather than eight months. We accept the People's concession and remand for resentencing on count 17.
We reject defendant's remaining contentions.
I. BACKGROUND
Defendant managed a home foreclosure rescue operation, doing business as Second Opinion Services and Financial Services Bureau Limited. He hired and supervised Alan, who testified for the prosecution under a grant of immunity. Neither defendant nor Alan was a licensed real estate broker, real estate agent, or attorney, and neither had registered with the State as a foreclosure consultant.
A. Defendant's "Mortgage Rescission" Program
According to Alan, defendant developed a "mortgage rescission" program that allowed financially distressed homeowners to avoid foreclosure and receive "fee simple title control" of their properties, free and clear of their mortgages. Under the program, homeowners paid an enrollment fee, and then signed quitclaim deeds transferring their properties to trusts created by defendant, with defendant as trustee. At defendant's instruction, homeowners would then stop paying their mortgages (if they had not done so already) and instead make monthly lease payments to defendant. Defendant told homeowners that the monthly lease payments would continue for a period of five years, after which, he claimed, they would own their homes free and clear.
During the trial, the jury heard from multiple prosecution witnesses that defendant's mortgage rescission program failed to work as advertised. The jury heard evidence about a number of transactions, involving a number of properties. We describe two such transactions in detail and provide a more general overview of the others.
1. The Walnut Avenue Property (Counts 1 to 3, 18, 20, and 21)
Hector owned a home on Walnut Avenue in Orangevale. Hector fell behind on his mortgage payments and went into default in October 2010. He heard about defendant's program from a friend and reached out for help. Defendant told Hector that he knew a way to save the house and gain title free and clear of the mortgage, but "it was going to cost [him]."
Defendant explained that Hector would pay an enrollment fee of $6,500, transfer the property to "an entity," and "lease the house back from the entity for $891 monthly" for a period of five years. He would then make a balloon payment of $75,000, which, defendant said, he could easily pay by refinancing, as he would now own the house free and clear.
Hector paid the $6,500 enrollment fee and signed a quitclaim deed in February or March 2011 transferring the house to a trust known as the H&H Barbershop Trust. Although defendant told Hector that he would have control over the property through the H&H Barbershop Trust (which was named for Hector's business), the abstract of trust, which defendant did not show Hector, identified defendant and Alan as trustees and gave them "absolute and exclusive power and control over the management and conduct of the business and affairs of the trust." Hector would not have signed the quitclaim deed had he known that he would be ceding control of the property to defendant.
Hector made monthly lease payments for several months, beginning in April and ending in September 2011. He stopped making payments to defendant on the advice of an attorney and instead resumed making monthly payments to his mortgage lender. Eventually, he managed to obtain a loan modification which allowed him to keep his house. Defendant was not involved in the process of securing the loan modification. Sometime later, a man appeared at Hector's house. The man identified himself as an associate of defendant, and claimed that Hector's house belonged to him. A short time later, in July 2013, Hector received a letter from defendant, asserting that defendant was now the owner of the house and claiming that Hector owed him more than $20,000 in back rent.
Later still, Hector learned that the quitclaim deed he had signed in 2011 had been recorded on July 16, 2013. Hector also learned that a document entitled "assumption agreement," in which the H&H Barbershop Trust purported to assume Hector's loan obligations, had been recorded the next day. Hector was forced to hire an attorney to clear title to the house. During the trial, the jury heard evidence that defendant had attempted to sell the Walnut Avenue property to Don, a real estate speculator who was willing to find investors for the property, going so far as to open an escrow for the property with Orange Coast Title Company in Sacramento.
2. The School Street Property (Counts 26 to 30)
Janet and Robert owned a home on School Street in Elk Grove. They ran into some financial difficulty in 2011 and contacted defendant. They were not living in their home at the time; rather, they had rented the property, and were traveling the country in their retirement in a fifth wheel trailer.
They were current on their mortgage, but the house was under water and they wanted to reduce their mortgage payments. Defendant told Janet and Robert that there was something wrong with their loan agreement, which would allow him to cancel their mortgage. He explained that his program would require them to transfer their property to a trust, but they would continue to own the property and could continue to lease it. Defendant told Janet and Robert that they would no longer make monthly mortgage payments to their lender, but would instead pay a reduced amount to another entity over a period of five years, followed by a balloon payment, which would be paid by refinancing. Janet and Robert were impressed by defendant's presentation and eager to improve their financial situation. They signed a contract to join defendant's program that very day. The contract called for a $6,500 enrollment fee, monthly payments of $951, and a balloon payment of $85,000.
Janet and Robert paid the enrollment fee and signed a quitclaim deed conveying their interest in the School Street property to a trust known as the "Forever Blessed Trust." They stopped making their mortgage payments, signed a lease agreement with the Forever Blessed Trust, and instructed their tenants to send monthly rental payments to defendant. When all was said and done, Janet and Robert paid defendant more than $18,000. Janet and Robert were not aware that the Forever Blessed Trust was governed by an abstract of trust created by defendant, naming defendant as trustee and granting defendant "absolute and exclusive control" over the management and disposition of the property. They would not have signed the quitclaim deed had they understood that they were ceding control of the property to defendant.
Fannie Mae acquired title to the School Street property as a result of a trustee's sale, which took place, unbeknownst to Janet and Robert, on April 22, 2013. The next day, the Forever Blessed Trust recorded a quitclaim deed purporting to convey the property to defendant. In the months that followed, defendant recorded a "notice of rescission of trustee's deed upon sale" purporting to rescind the trustee's deed of sale by which Fannie Mae acquired title to the property, and another quitclaim deed purporting to convey Fannie Mae's interest in the property to himself. Defendant signed both documents as an authorized representative of Fannie Mae; however, defendant had no such authorization.
Fannie Mae regularly acquires property through foreclosure, and tries, as a matter of policy, to sell such property as quickly as possible. Fannie Mae was unable to follow its usual policy in the case of the School Street property, as the documents described above—two quitclaims deeds and a purported notice of rescission of trustee's sale—created a cloud on title that interfered with Fannie Mae's ability to market and sell the property. To make matters worse, someone repeatedly broke into the house and changed the locks. During this time, defendant attempted to rent the School Street property to a new tenant and offered the property to Don for sale to an investor.
In the end, Fannie Mae was forced to bring an action to remove the cloud on title. The trial court took judicial notice of a judgment entered in Fannie Mae's favor on July 28, 2014. Fannie Mae incurred attorneys’ fees of $17,792 and estimated maintenance and holding costs of $18,399 as a result of the litigation.
3. Other Properties: Iceberg Lane (Counts 6, 7, and 23), Woodfield Way (Counts 8, 9, and 24), Cornelia Way (Counts 10, 11, and 25) and Azalea Road (Counts 4, 5, and 22)
Fannie Mae acquired title to real property on Iceberg Lane in Roseville following a trustee's sale in July 2013, and Woodfield Way, also in Roseville, following a trustee's sale in August 2013. A short time later, on September 27, 2013, defendant recorded grant deeds with the Placer County Recorder's Office purporting to transfer Fannie Mae's interest in the Iceberg Lane and Woodfield Way properties to himself. Defendant signed the deeds as an authorized representative of Fannie Mae, without authorization to do so. J.P. Morgan acquired title to real property on Azalea Road in Sacramento following a trustee's sale in September 2009. Several years later, on August 8, 2013, a grant deed was recorded with the Sacramento County Recorder's Office purporting to transfer J.P. Morgan's interest in the Azalea Road property to defendant. Defendant signed the grant deed as an authorized representative of J.P. Morgan, without authorization to do so.
J.P. Morgan acquired title to real property on Cornelia Way in Sacramento following a trustee's sale in August 2013. A short time later, on September 27, 2013, a grant deed was recorded with the Sacramento County Recorder's Office purporting to transfer J.P. Morgan's interest in the Cornelia Way property to defendant. Defendant signed the grant deed as an authorized representative of J.P. Morgan, without authorization to do so.
Defendant attempted to sell the properties through Don, opening escrows for sales to investors with Orange Coast Title Company in September 2013. The escrows fell through when a concerned escrow officer contacted the title company's legal department.
As we shall discuss, defendant argues the prosecution failed to establish venue in Sacramento County for counts 6 and 8, both of which charged defendant with recording false or forged instruments with the Placer County Recorder's Office in violation of section 115. Defendant also argues the sentences imposed for counts 22 to 25 for attempted grand theft ( §§ 664, 487 ) (discussed below) should have been stayed pursuant to section 654.
B. Trial Court Proceedings
Defendant was charged in an amended information with two counts of unlawfully demanding or receiving compensation prior to fully performing services that a foreclosure consultant has contracted to perform or represented that he would perform (counts 1 and 29— Civ. Code, § 2945.4, subd. (a) ), two counts of unlawfully acquiring an interest in a residence in foreclosure with whom a foreclosure consultant has contracted (counts 2 and 30— Civ. Code, § 2945.4, subd. (e) ), ten counts of filing false instruments (counts 3, 4, 6, 8, 10, 12, 13, 15, 18, 26— § 115, subd. (a) ), six counts of identity theft (counts 5, 7, 9, 11, 14, 16— § 530.5, subd. (a) ), one count of second degree burglary (count 17— § 459 ), one count of perjury (count 19— § 118, subd. (a) ), three counts of grand theft (counts 20, 27-28— § 487, subd. (a) ), and five counts of attempted grand theft (counts 21-25— §§ 664, 487, subd. (a) ).
The information further alleged that defendant took property of value exceeding $65,000 (former § 12022.6, subd. (a)(1) ) and $200,000 (former § 12022.6, subd. (a)(2) ; § 1203.045 ), and the offenses involved a pattern of fraud and embezzlement with a taking of more than $100,000 and more than $500,000 ( § 186.11, subd. (a) ). The information further alleged that defendant committed the offenses charged in counts 6 through 11 while out on bail. ( § 12022.1.)
1. Waiver of Right to Counsel
Defendant filed a motion to represent himself under Faretta v. California (1975) 422 U.S. 806, 95 S.Ct. 2525, 45 L.Ed.2d 562 ( Faretta ) in December 2014, approximately one month before the then-scheduled trial date. The motion indicated that defendant wanted to represent himself because his appointed counsel, Attorney Robert Saria, was unwilling to file various motions to dismiss the information on defendant's behalf. The motion also indicated that Attorney Saria "would remain as trial counsel of record in the event defendant so requests."
Defendant appeared before the trial court (Sapunor, J.) for a hearing on the motion on January 9, 2015. The trial court warned defendant of the dangers of self-representation, noting that "the penalties if you're found guilty are severe." The trial court continued, "Could be eighteen years, could be 25 years or a little bit more, but it's serious business." The trial court also cautioned defendant that he would not have a right to advisory counsel if he chose to represent himself, stating, "There is no right to standby counsel for assistance, and we don't do it."
Defendant affirmed that he still wanted to represent himself. The trial court granted defendant's motion. The trial date was subsequently vacated and reset.
2. Requests for Advisory Counsel
Several months later, on May 12, 2015, defendant filed a motion for appointment of advisory counsel. The motion stated: "Defendant is ready, willing and able to present his own defense on the merits, but recognizes his need for help in court protocol and procedure at trial."
Defendant appeared for a hearing on the motion before the trial court (Davidian, J.) on May 19, 2015. Defendant explained that he was "facing a fairly complex trial," reiterating that he wanted advisory counsel "for really just the procedural aspects to be able to conduct the—the court protocol, things of that nature." Judge Davidian acknowledged that advisory counsel may be appointed "[i]n the sound discretion of the trial judge." He noted that the court is not required to appoint advisory counsel (see People v. Debouver (2016) 1 Cal.App.5th 972, 976, 205 Cal.Rptr.3d 318 ) adding that: "We don't have counsel funds, advisory counsel funds in Sacramento County. We don't have the ability to pay for that sort of thing. We don't have—we don't provide advisory counsel."
He then denied the motion, stating: "As we discussed in your Faretta motion, this is on you. You have to know how this is done. That's why I—I strenuously advised you against exercising Faretta rights that gave you the right to do that. In fact, granted it, but you would be held to the same standard, and you will be. [¶] And so, your request for advisory counsel is denied. This is in the discretion of the [c]ourt, especially for what you've asked for, that—that they have—he or she have a very limited role of advising you about what proper protocol is. You're expected to know that because you elected to represent yourself. [¶] So the motion is denied." (Italics added.)
Defendant filed a second motion for appointment of advisory counsel two weeks later, on June 2, 2015. The motion argued that Judge Davidian had been incorrect in stating that Sacramento County does not provide advisory counsel for pro se defendants, noting that he was aware of another pro se defendant whose motion for appointment of advisory counsel had been granted. As before, defendant represented that he was "ready, willing and able to present his own defense on the merits," but recognized his "need for help in court protocol and procedure during pretrial motion practice and procedure at trial."
Defendant appeared before Judge Currier for a hearing on the motion (and other matters) on June 5, 2015. Judge Currier began by noting that defendant had previously requested advisory counsel, and Judge Davidian had denied the request. Judge Currier continued: "I'm not sure why Judge Davidian used that language, it's probably a bit overbroad, but you could be entitled to advisory counsel. But in Sacramento County, we use a pro per coordinator to ensure that you're getting the resources you need to prepare your defense." Judge Currier asked defendant to explain why these resources were not sufficient.
Defendant responded at length, arguing that the investigator and pro per coordinator were not as available to him as he would like, and the process of communicating with them was cumbersome. Defendant maintained that he wanted to represent himself, because he wanted to tell his own story, and he believed he was in the best position to do so. Nevertheless, defendant acknowledged that an attorney would be helpful, adding that he was hoping that advisory counsel would offer input on making appropriate objections and calculating deadlines. Judge Currier responded: "I would consider appointing you an attorney or I will consider increasing the resources available to you, but I'm not inclined to give you advisory counsel. You're not entitled to that under the law." When defendant asked why advisory counsel had recently been appointed for another pro se defendant, but not him, Judge Currier responded that he was not familiar with the facts of the other case. He concluded: "I see that a previous judge has denied you advisory counsel, I have heard the arguments, I have looked at your pleadings and listened to your argument, and I don't see any persuasive reason why I should give you advisory counsel." Accordingly, Judge Currier denied defendant's second request for advisory counsel.
3. Alan's Testimony
As noted, Alan was defendant's longtime business associate, who testified for the prosecution under a grant of immunity. During the prosecution's case-in-chief, Alan reviewed records for 60 entities created to hold title to an equal number of distressed properties as part of defendant's mortgage rescission program. Of the 60 properties held by these 60 entities, none, other than Hector's, had been returned to the homeowner. Even so, Alan testified that the "primary objective" of defendant's program was "[t]o return a fee simple title control to the client."
Defendant cross-examined Alan at length, over the course of three days. On cross-examination, Alan testified, inter alia, that he had consulted with attorneys, and conducted his own legal research, and believed defendant's program to be legal. Alan testified that some of the entities holding distressed properties were turned over to homeowners, and agreed with defendant that they intended to turn all such entities over to homeowners "at some point." However, Alan acknowledged on redirect that, of the 60 properties discussed during his direct examination, a majority had been foreclosed upon. Alan also acknowledged that he had not said anything about turning entities or trusts over to homeowners during his earlier testimony or in interviews with law enforcement. Alan was excused subject to recall.
Sometime later, defendant advised the trial court that he intended to call Alan as a witness for the defense. The prosecutor responded that the prosecution was not required to offer immunity to Alan for his testimony as a defense witness. The trial court heard argument on the issue several days later. During the course of the hearing, defendant argued that Alan was a "key witness," who would corroborate defendant's testimony, authenticate documents, and vouch for defendant's business practices and character. The trial court ruled that the court could neither force an offer of immunity for Alan, nor force him to testify in the event that he invoked his Fifth Amendment right against self-incrimination. Alan appeared before the trial court several days later. Defendant reiterated that he planned to question Alan about defendant's business practices and character. Alan responded that he intended to invoke his Fifth Amendment rights. Defendant decided not to call Alan in view of the trial court's earlier ruling. The trial court dismissed Alan.
4. John's Testimony
John is a real estate attorney in Sacramento who met with defendant in August 2011 to discuss the structure of a transaction that defendant was working on. Defendant identified John as a witness for the defense.
During an Evidence Code section 402 hearing, the prosecutor expressed concern that John might be used to offer opinion testimony as to the legality of defendant's mortgage rescission program (which had previously been found to be illegal) or hearsay evidence regarding the substance of his meeting with defendant. Defendant responded that he intended to question John as a percipient witness to the August 2011 meeting. The trial court warned defendant that the prosecutor would object to questions about what was said at the meeting on hearsay grounds, asking, "Do you have an exception to the hearsay rule that you plan to use?" Defendant responded, in part, "I'm not sure what the evidentiary exception would be other than we had a meeting to discuss the particulars of the program and my understandings of what the law required, not so much of what the interpretation of the law was or what—trying to work on the merits of the law or whether it's right or wrong, other than that I felt here's what I was doing based on the legal requirements that—as I understood the law to be, for my position with my people to work and what can be done to facilitate that, what areas needed to be improved on, whether I was on the right track, things of that nature, any input on how I worked with the entities, the reason for the entities, things of that nature that were totally, you know, not part of the rescission processes but things of that nature that we went through." The trial court reiterated, "when you start talking about who said what to who, you better have an exception to the hearsay rule or [the prosecutor's] objections will be sustained."
John took the stand on October 19, 2015, and offered an overview of the August 2011 meeting. Defendant then asked John a series of questions about what was discussed at the meeting, drawing hearsay objections from the prosecutor, which were sustained. The trial court admonished defendant to refrain from eliciting hearsay testimony, unless he could make an offer of proof that an exception applied. Defendant protested, "I would just like to be able to ask him what he recalled about the meeting and the questions that were raised and addressed in a narrative form." The trial court responded, "Sir, you were explained about the hazards of representing yourself, one of which is unfamiliarity with the [E]vidence [C]ode. And unless you have an exception to the hearsay rule, then the law would look at anything you said outside of court as self-serving testimony—or self-serving statements and so they would be inherently unreliable in accordance with the law unless there was some exception." The trial court again admonished defendant to refrain from eliciting out-of-court statements unless he could point to an exception to the hearsay rule.
Defendant continued to ask John questions about what was discussed at the meeting. The prosecutor continued to object, and the trial court continued to sustain the objections. After some time, the trial court stated, "Mr. Schmidt, I warned you three times now. I'm going to ask you one more time to not ask questions that elicit out-of court statements. If you persist and ignore my warnings, I will terminate your examination of this witness." Defendant acknowledged that he was having "difficulty articulating and understanding the hearsay rules," and ended his examination of John. John was excused subject to recall.
Defendant asked to recall John the following week, on October 26, 2015, (the 45th day of trial). When asked why he wanted to recall John, defendant responded, "I had difficulty qualifying and getting the hearsay exception and I said I needed time to study that up a little bit to get into non-hearsay and relevance and all of these different things that would allow the testimony that was conducted at the meeting to be elicited. I didn't get to first base on that." The trial court responded, "I'm not going to allow you to call an attorney back to the stand because of your wanting to revisit the material that you had an opportunity to ask him about the first time. [¶] We have spent way too much time on this trial. You've spent time going over things that I told you not to go over with the witnesses and I'm not going to let you recall witnesses because you forgot to ask a question or you did not know the rules of evidence." With that, the trial court denied defendant's request.
5. Defendant's Testimony
Defendant testified on his own behalf. Defendant explained that he had spent time in federal prison in the 1990s and used the time to study federal law. He recalled that he conceived the idea for the mortgage rescission program in 2008, with the goal of helping people to stay in their homes as long as possible. He described the program at length, claiming that he had formed an understanding, on the basis of his own research, that the law allows borrowers to rescind their loan agreements in a variety of circumstances, none of which appears to have merit (and none of which are before us on appeal). By way of example, defendant testified that a borrower can rescind a loan agreement when the lender fails to make certain disclosures or fails to produce the original note. (But see Jenkins v. JPMorgan Chase Bank, N.A. (2013) 216 Cal.App.4th 497, 505, 156 Cal.Rptr.3d 912 [production of the note is not required to perfect foreclosure], disapproved on other grounds by Yvanova v. New Century Mortgage Corp. (2016) 62 Cal.4th 919, 926, 199 Cal.Rptr.3d 66, 365 P.3d 845.)
On cross-examination, defendant acknowledged that he was named as trustee for approximately 60 trust entities, each of which held property transferred by quitclaim deed, over which he exercised absolute control, either individually or with Alan, his employee. Defendant also acknowledged that none of the homeowners who participated in his program succeeded in having their mortgages rescinded, and only one—Hector—was able to avoid foreclosure and remain in his home.
Defendant also acknowledged that he had previously been convicted of conspiracy to impede and impair the Internal Revenue Service, conspiracy to commit witness tampering, and five counts of witness tampering and aiding and abetting witness tampering in federal court in North Carolina in 1990, and one count of conspiracy in federal court in California in 1990. Defendant acknowledged that the North Carolina case alleged that defendant used sham trust entities as part of a program designed to eliminate tax liabilities, which was similar in structure to the mortgage rescission program in the present case. However, defendant maintained that the conviction was erroneous, claiming he had researched the law and believed he was legally entitled to structure tax avoidance transactions as he had.
6. Jury Instructions
The trial court instructed the jury on December 3, 2015, after 68 days of trial. As relevant here, jurors were instructed with CALCRIM No. 375 that they could consider evidence of defendant's prior convictions and other transactions arising out of his mortgage rescission program on the "specific grounds of relevance" of intent, motive, knowledge, common plan or scheme, or absence of accident or mistake. Defendant did not object to the instruction.
7. Verdict and Sentence
The jury received the case on December 8, 2015—the 72nd day of trial—and reached a verdict the next day. The jury found defendant guilty on all counts, and found true the allegations that his takings exceeded $65,000 and $200,000, and the offenses involved a pattern of fraud and embezzlement with takings exceeding $100,000 and $500,000. The jury also found true the allegation that defendant committed counts 6 through 11 while out on bail. The trial court then sentenced defendant to the upper term of four years on count 19 ( § 118, subd. (a) ), and one-third the middle term on all remaining counts, all consecutive to count 19, with the exception of count 17, the second degree burglary ( § 459 ). The trial court reduced the felony burglary charge to a misdemeanor shoplifting charge (§ 495.5), and sentenced defendant to one year consecutive on that count. The trial court sentenced defendant to an additional five years for the section 186.11 enhancement and two years for the former section 12022.6, subdivision (a)(2) enhancement, for a total term of 28 years in state prison and one year consecutive in county jail.
The trial court also imposed various fines, fees, and assessments, including a restitution fine of $4,800 ( § 1202.4 ), a parole revocation fine of $4,800 ( § 1202.45 ), which was stayed, a $1,200 court operations assessment ( § 1465.8 ), and a $900 court facilities assessment ( Gov. Code, § 70373 ). Defendant did not object or otherwise indicate he would be unable to pay these amounts.
Defendant filed a timely notice of appeal.
II. DISCUSSION
A.-B. [NOT CERTIFIED FOR PUBLICATION]
See footnote, ante, page 1042.
C. Filing False or Forged Documents (Counts 3 and 26)
Defendant challenges the sufficiency of the evidence to support the convictions on counts 3 and 26, which charged him with violating section 115 by filing false or forged quitclaim deeds for the Walnut Avenue (count 3) and School Street (count 26) properties. Specifically, defendant argues that there was insufficient evidence that the quitclaim deeds were false or forged because Hector, Janet and Robert actually owned the Walnut Avenue and School Street properties and were legally entitled to quitclaim them to defendant. The People respond that the quitclaim deeds were false within the meaning of section 115 because they were induced under false pretenses and had the effect of clouding title. Defendant has the better argument.
Section 115 provides: "Every person who knowingly procures or offers any false or forged instrument to be filed, registered, or recorded in any public office within this state which instrument, if genuine, might be filed, registered, or recorded under any law of this state or of the United States, is guilty of a felony." ( § 115, subd. (a).) The purpose of section 115 is "to prevent the recordation of spurious documents knowingly offered for record." ( Generes v. Justice Court (1980) 106 Cal.App.3d 678, 681-682, 165 Cal.Rptr. 222 ( Generes ); see also People v. Feinberg (1997) 51 Cal.App.4th 1566, 1579, 60 Cal.Rptr.2d 323 [" ‘The core purpose of ... section 115 is to protect the integrity and reliability of public records’ "].)
Section 115 can be violated in two ways: (1) by procuring or offering a false instrument for filing; or (2) by procuring or offering a forged instrument for filing. ( Generes, supra, 106 Cal.App.3d at p. 682, 165 Cal.Rptr. 222.) Defendant's convictions on counts 3 and 26 were based on the theory that defendant knowingly procured or offered false quitclaim deeds for filing. We must therefore determine whether substantial evidence supports a finding that the quitclaim deeds were "false" within the meaning of section 115, a task which requires us to determine the proper interpretation of the statute. Although we review a jury's findings of guilt for substantial evidence, statutory interpretation is a question of law we review de novo. ( People v. Spriggs (2014) 224 Cal.App.4th 150, 154, 168 Cal.Rptr.3d 347.) Another panel of this court considered the application of section 115 to a "false" instrument in Generes. There, the defendant recorded a deed that purported to transfer from herself to herself an easement over land she did not own. ( Generes, supra, 106 Cal.App.3d at p. 681, 165 Cal.Rptr. 222.) The defendant was charged with violating section 115. ( Ibid. ) The justice court overruled the defendant's demurrer to the complaint. ( Ibid . ) The defendant then petitioned the superior court for a writ of prohibition. ( Ibid . ) The superior court issued a peremptory writ, stating: " ‘It appears from the face of the complaint that [the defendant] filed a document which was exactly what it purported to be: to wit, a deed from herself to herself granting herself an easement over land she did not own. The court does not rule that this conduct is legal. It merely states now that it is not a violation of ... section 115.’ " ( Ibid . )
The prosecutor argued that the quitclaim deeds were false, not forged.
The People appealed, arguing that the superior court applied an overly narrow construction of the word "false." ( Generes, supra, 106 Cal.App.3d at p. 681, 165 Cal.Rptr. 222.) This court agreed, emphasizing the fact that section 115 differentiates between false and forged instruments. ( Generes, supra, at p. 682, 165 Cal.Rptr. 222.) "Obviously," the court observed, "an instrument may have the effect of defrauding one who acts on it as genuine even though it does not bear a forged signature or otherwise meet the technical requirements of a forged instrument." ( Ibid. ) "Here," the court explained, "the lack of an ownership interest in the land goes to the deception itself. If Generes did not own the interest she purported to convey, the instrument she filed was clearly false. Having no right to grant or convey an easement, her recording of a deed transferring an easement would establish a cloud on the title of those persons who lawfully owned interests in the land. A title searcher encountering the spurious document who acted upon it as genuine would of course be materially deceived." ( Ibid . )
The Court of Appeal for the Fourth District, Division Two, considered similar facts in People v. Denman (2013) 218 Cal.App.4th 800, 804-806, 159 Cal.Rptr.3d 812 ( Denman ). There, the defendant recorded quitclaim deeds and homestead declarations on nine properties that he believed to have been abandoned in order to acquire them by adverse possession. ( Id. at pp. 804-807, 159 Cal.Rptr.3d 812.) The defendant had no claim of title to the properties and was convicted of 20 counts of violating section 115. ( Denman, supra, at p. 804, 159 Cal.Rptr.3d 812.) On appeal, he argued that the quitclaim deeds were not false within the meaning of section 115, as they only purported to transfer any interest he actually had in the properties. ( Denman, supra, at pp. 807-810, 159 Cal.Rptr.3d 812.) The appellate court rejected the defendant's argument, stating: "Here, defendant filed quitclaim deeds to himself on property to which he admitted he had no title or interest. While defendant is technically correct that he attested in the quitclaim deed that he was only transferring whatever title or interest he possessed, it was clearly based on the evidence he had absolutely no interest in the property. The documents themselves were false in that they transferred an interest that he did not have to himself and then he recorded the document, clouding the title of the true property owners. Adopting defendant's reasoning would be in direct contradiction with the purpose behind section 115 to preserve and protect the integrity of public records. Based on the purpose of the statute and the fact that section 115 has been broadly construed, the quitclaim deeds could reasonably be considered false documents by the jury." ( Id. at p. 809, 159 Cal.Rptr.3d 812.) Defendant persuasively distinguishes Generes and Denman , noting that Hector, Janet and Robert actually owned the Walnut Avenue and School Street properties and could legally convey their interests to the H&H Barbershop and Forever Blessed Trusts if they so chose. Unlike the instruments found to have been false in Generes and Denman , there was no evidence that the quitclaim deeds forming the bases for counts 3 and 26 were false in the sense that they purported to transfer interests that the grantors did not lawfully possess. (See Generes, supra, 106 Cal.App.3d at p. 682, 165 Cal.Rptr. 222 [if defendant "did not own the interest she purported to convey, the instrument she filed was clearly false"]; Denman, supra, 218 Cal.App.4th at p. 809, 159 Cal.Rptr.3d 812 [although the quitclaim deeds stated the defendant was only transferring whatever title or interest he possessed, the deeds were "false in that they transferred an interest that [defendant] did not have"].) To the contrary, the evidence showed that Hector, Janet and Robert actually owned the Walnut Avenue and School Street properties, and intended to transfer them to the H&H Barbershop and Forever Blessed Trusts, respectively, by means of the quitclaim deeds. Although an instrument may be false in other ways not specified in Generes or Denham , there was no evidence that the quitclaim deeds underlying counts 3 and 26 were anything other than what they purported to be. On the record before us, we conclude the evidence was insufficient to support a finding that the quitclaim deeds were false.
The People resist this conclusion, arguing that the quitclaim deeds were induced by fraud. That may be so, but the People have not directed our attention to any authority establishing that fraud in the inducement renders an instrument "false" within the meaning of section 115, and we decline to so hold. We reiterate that section 115 reaches instruments which, "if genuine , might be filed, registered, or recorded under any law of this state ...." ( § 115, subd. (a), emphasis added.) A fraudulently induced deed, though voidable, is nevertheless "genuine" in the sense that it conveys title and can be relied upon and enforced by a bona fide purchaser. (See, e.g., Fallon v. Triangle Management Services, Inc. (1985) 169 Cal.App.3d 1103, 1106, 215 Cal.Rptr. 748 ["If a grantor is aware that the instrument he is executing is a deed and that it will convey his title, but is induced to sign and deliver by fraudulent misrepresentations or undue influence, the deed is voidable and can be relied upon and enforced by a bona fide purchaser"].) By contrast, "a forged document is void ab initio and constitutes a nullity; as such it cannot provide the basis for a superior title as against the original grantor." ( Wutzke v. Bill Reid Painting Service, Inc. (1984) 151 Cal.App.3d 36, 43, 198 Cal.Rptr. 418 ; see City of Los Angeles v. Morgan (1951) 105 Cal.App.2d 726, 733, 234 P.2d 319 ["An instrument that is void ab initio is comparable to a blank piece of paper and so necessarily derives no validity from the mere fact that it is recorded"].) Likewise, a deed altered without authority before delivery or recording (see, e.g., Montgomery v. Bank of America Nat. Trust & Savings Ass'n (1948) 85 Cal.App.2d 559, 563, 193 P.2d 475 ), or a deed procured by fraud in the inception (as opposed to fraud in the inducement) (see, e.g., Erickson v. Bohne (1955) 130 Cal.App.2d 553, 555-557, 279 P.2d 619 ), is void and conveys no title to the grantee. (See generally 3 Miller & Starr, Cal. Real Estate (4th ed. 2019) §§ 8:53-8:54, pp. 8-155 to 8-160 [discussing the difference between void and voidable instruments in the context of altered and fraudulently induced deeds].) In the absence of evidence that the quitclaim deeds underlying counts 3 and 26 were forged or false in the sense that they would not convey title to a bona fide purchaser, we must conclude that they were operative, and must therefore be considered "genuine." (See Fallon v. Triangle Management Services, Inc., supra, 169 Cal.App.3d at p. 1106, 215 Cal.Rptr. 748 ["Until a voidable deed is declared void it is fully operative"].) Being genuine, the quitclaim deeds cannot be said to have been "false" within the meaning of section 115. On the record before us, we conclude that there was insufficient evidence to support a finding that the quitclaim deeds underlying counts 3 and 26 were false. We must therefore reverse those convictions.
III. DISPOSITION
D.–M. [NOT CERTIFIED FOR PUBLICATION]
The judgment is reversed with respect to counts 3 and 26 ( § 115 ), 20 and 28 ( § 487, subd. (a) ), 29 ( Civ. Code, § 2945, subd. (a) ), and 30 ( Civ. Code, § 2945.4, subd. (e) ). We remand for resentencing in accordance with this opinion. In all other respects, the judgment is affirmed.
Hull, Acting P. J., concurred.
Concur by : Mauro, J.
Mauro, J., Concurring.
[NOT CERTIFIED FOR PUBLICATION]
I fully concur in the majority opinion except for part II.M., pertaining to the imposed fines, fees, and assessments, in which I concur in the result.
In prior opinions I have generally been disinclined to find that a defendant forfeited a claim based on People v. Dueñas (2019) 30 Cal.App.5th 1157, 242 Cal.Rptr.3d 268 because, among other things, Dueñas was not a sufficiently foreseeable extension of case law. ( People v. Johnson (2019) 35 Cal.App.5th 134, 137-138, 247 Cal.Rptr.3d 1.) However, I have concurred in the affirmance of judgments imposing fines, fees, and assessments when the record showed that the defendant obtained significant financial gain from the crimes. This is such a case. Accordingly, as to part II.M. of the majority opinion, I concur in the result.
Appellant's petition for review by the Supreme Court was denied February 19, 2020, S259706.