Opinion
No. 31025-2-II
Filed: February 23, 2005 UNPUBLISHED OPINION
Appeal from Superior Court of Clark County. Docket No. 02-1-01755-0. Judgment or order under review. Date filed: 09/26/2003. Judge signing: Hon. Barbara D. Johnson.
Counsel for Appellant(s), R.A. Lewis, Attorney at Law, 430 NE Everett St, Camas, WA 98607-2115.
David Schultz, Attorney at Law, 430 NE Everett, Camas, WA 98607-2115.
Counsel for Respondent(s), Philip A. Meyers, Attorney at Law, PO Box 5000, Vancouver, WA 98666-5000.
Orville Michael Rice appeals from an exceptional sentence imposed after his plea of guilty to one count of first degree theft. The court-imposed exceptional sentence, based on two aggravating factors, must be reversed under Blakely v. Washington, U.S., 124 S. Ct. 2531, 159 L. Ed. 2d 403 (2004), because the aggravating factors were not submitted to a jury, found beyond a reasonable doubt, nor admitted by Rice. Following the decision in State v. Harris, Wn. App., 99 P.3d 902 (2004), we reverse and remand for resentencing with the direction that the trial court may empanel a jury to determine the facts on which the court can base its decision to impose an exceptional sentence.
On January 21, 1993, the Clark County Superior Court appointed Orville Rice guardian of the person and estate of Helen Critchlow, his stepmother. Critchlow suffered from dementia and was unable to care for herself. At the time the court established the guardianship, Critchlow's estate included an investment account at Smith Barney Shearson, Inc.; a guardianship checking account at Northwest National Bank; and monthly Social Security Income benefits and other assets. She also received approximately $548 a month as a survivor's benefit from her late husband's military pension. The military pension check was deposited directly into the guardianship checking account. The Social Security Administration mailed Critchlow's Social Security checks to Rice.
By January 1999, Critchlow's Smith Barney account had a balance of over $200,000, and her guardianship checking account contained approximately $32,000. The monthly benefit she received from Social Security was approximately $1,256. Critchlow's care facility cost $3,400 a month.
Rice worked as an investment manager. In 1998, he borrowed $18,500 from the guardianship account due to personal financial difficulties. He paid the money back with interest by the end of 1998.
As Rice continued to have financial difficulties, he continued to borrow from Critchlow's funds. Between January 1999 and June 2002, Rice deposited nearly all of his stepmother's monthly Social Security checks into his own personal checking account. He then used the money for his own personal use. Rice also withdrew money from Critchlow's Smith Barney account. Rice deposited part of the funds from the Smith Barney account into his own account. He used this money for his own personal expenses. Rice placed the remainder of the funds from Smith Barney into the guardianship checking account. He then wrote checks from the guardianship account to himself and deposited the checks into his own personal account.
Critchlow owned property in Nevada, and Rice petitioned the court to sell the property. He received the check for the property and deposited it into his own account. Rice indicated, however, that he had deposited the $7,500 into Critchlow's guardianship account. He also neglected to tell Don Russo, his attorney, what he had done with the money.
In 2001, Rice stopped paying Critchlow's nursing care facility, the Parkway North Care Center. The administrator from Parkway North noticed in June 2001 that the care facility had not received payment for Critchlow's care. Rice owed Parkway North around $30,000 to $32,000 for his stepmother's care. Parkway North sent an eviction letter giving 30 days' notice but it did not evict Critchlow.
Eventually, the administrator contacted Rice and he signed a promissory note for the amount owed to the facility. When Rice failed to make payments on the promissory note, Parkway North notified Adult Protective Services. It also advised Rice if there was no money to pay the bills, he should apply for Medicaid for his stepmother. Rice filled out the Medicaid forms in March 2002, and Parkway North began receiving payments from Medicaid. The Department of Social and Health Services (DSHS) paid for Critchlow's care for approximately a year.
Adult Protective Services investigated Rice after it received notice from Parkway North, to see if financial exploitation had taken place. Adult Protective Services contacted Rice on February 13, 2002. After reviewing Critchlow's guardianship papers, it referred the case to the court. The court reviewed the guardianship on April 26. The court voiced its concern that Rice had embezzled money from Critchlow. It then appointed Gary Beagle to replace Rice as Critchlow's guardian.
On August 30, 2002, Rice again appeared in court. The court found probable cause to arrest him on theft charges. The State charged Rice with first degree theft on September 5, for acts occurring between January 1, 1997 through June 10, 2002.
Rice pleaded guilty on June 10, 2003. The standard sentence range for Rice was 0 to 90 days based on an offender score of 0. The State recommended an exceptional sentence.
The court held an evidentiary hearing on September 23 and 26, 2003. During the hearing, Rice admitted that he had received Critchlow's Social Security checks and that he had deposited the check he received from selling property in Nevada into his own personal account. He also testified that he never asked his attorney whether he could use Critchlow's money.
In arguing for an exceptional sentence, the State focused on Rice's breach of fiduciary duty to Critchlow and that his crime was a major economic offense. It asked for a 60-month sentence. The attorney for the new guardian asked for the maximum allowable sentence, 10 years. Rice argued that since he neither pleaded to the aggravating factors nor admitted to them in his guilty plea, the court should not apply the factors to his case. Rice asked the court to consider some mitigating factors and sentence him within the standard range.
In its oral ruling, the court found that Rice's crime involved a vulnerable victim in that Critchlow was not in a position to speak up for herself and that the crime was a major economic offense. The trial court imposed an exceptional sentence of 90 months. The court entered its written findings of facts on October 15, 2003. The written findings stated that the exceptional sentence was based on Rice's breach of fiduciary duty and that the crime involved a major economic offense.
Because we decide this case on the basis of Blakely and hold that harmless error does not apply, we do not address the court's rationale for its exceptional sentence.
I. Applicability of Blakely
The United States Supreme Court held in Apprendi v. New Jersey, 530 U.S. 466, 490, 120 S. Ct. 2348, 147 L. Ed. 2d (2000), that: `[o]ther than the fact of a prior conviction, any fact that increases the penalty for a crime beyond the prescribed statutory maximum must be submitted to a jury, and proved beyond a reasonable doubt.' Here, the trial court erred when it imposed an exceptional sentence on Rice without first submitting the issue to a jury.
In Blakely, the Supreme Court applied its ruling from Apprendi and held that any fact a court uses to increase a penalty beyond the statutory maximum must first be submitted to a jury and proved beyond a reasonable doubt. Blakely, 124 S. Ct. at 2536. Here, the trial court found that Rice's crime constituted a major economic offense and that he breached a fiduciary duty to Critchlow when he stole money from her. The court did not submit either of these aggravating factors to a jury. Nor were they found beyond a reasonable doubt, which is the burden of proof necessary for the imposition of an exceptional sentence under Blakely. (The sentencing here was under RCW 9.94A.530(2), which allowed the court to make the determination by a preponderance of the evidence.) Blakely, 124 S. Ct. at 2536.
The State argues that Blakely does not apply because Rice admitted to the facts of the case. The State misinterprets Blakely. While Rice admitted to loaning himself money from his stepmother while he was her guardian and using it for his own personal gain; and, in pleading guilty, that he took more than $1,500, Rice did not admit that he breached a fiduciary duty he owed to Critchlow or that he had committed a major economic offense. The dissent argues that this is an admission of a `breach of fiduciary duty' by law. However, the dissent includes the value of the theft of more than $200,000 in the dissent's analysis. His admission of an improper loan is not an admission by him of a breach of fiduciary duty and the value is necessarily a fact that must be determined by a jury. Only a jury could find these two aggravating factors, not the court. Thus, Rice must be resentenced.
The State asks us to apply a harmless error analysis and affirm the sentence. But, as stated in Neder v. United States, 527 U.S. 1, 119 S. Ct. 1827, 144 L. Ed. 2d 35 (1999), harmless error cannot be applied to structural errors, which are subject to automatic reversal. Neder, 527 U.S. at 8 (listing as examples of structural errors: total denial of counsel, biased trial court, racial discrimination in selection of grand jury, denial of self-representation at trial, denial of public trial, and defective reasonable-doubt instruction). Structural errors are those errors affecting the framework within which the trial proceeds that then infects the entire trial process. Neder, 527 U.S. at 8.
Neder is inapplicable to the present case. Failing to submit aggravating factors to a jury affects a defendant's fundamental right to a trial. It was not harmless.
II. Remedy
The State asks for the opportunity to present evidence of aggravating factors to a properly empanelled jury. Rice replies that a remand for trial is improper because the State did not allege any of the aggravating factors for an exceptional sentence in the information. But this is not a `notice' case because Rice knew before pleading guilty that the State was going to recommend an exceptional sentence. Rice even informed the court that he intended to contest an exceptional sentence and advised the court, `We will be asking for a standard sentencing range.' Report of Proceedings (Jun. 10, 2003) at 9.
We also find unconvincing Rice's argument that the State is somehow precluded from requesting such a remedy because it did not present this alternative, i.e., a jury trial, to the sentencing court, nor cross-appeal the sentencing. This argument is specious and fallacious. First, Blakely was not decided until long after time for filing a cross-appeal had elapsed. Second, the State, at the time of sentencing, properly proceeded under State v. Gore, 143 Wn.2d 288, 21 P.3d 262 (2001), which had distinguished Apprendi; thus, the State had no reason to suggest a jury trial using reasonable doubt. Finally, and most importantly, Rice consistently urged throughout the proceedings that he be sentenced under Apprendi; thus, the issue was squarely before us on appeal. Unfortunately, the appropriate remedy is not clear from Blakely, but we adopt and follow the analysis and the holding in Harris, 99 P.3d 902.
There Division One held that prior case law, RCW 2.28.150, and the superior court criminal rules illustrate that courts have the inherent power to `supplement the exceptional sentence statutes with the constitutionally-mandated procedures announced in Blakely.' Harris, 99 P.3d at 911. Thus, the appellate court found that a trial court had the power under CrR 6.16 to empanel a jury in order to determine the facts on which the court could base its decision to impose an exceptional sentence. Harris, 99 P.3d at 912. Therefore, the sentencing court in this case may empanel a jury to determine facts that would support an exceptional sentence.
Because Rice pleaded guilty, he has waived any appeal regarding a factual basis for his convictions. The issues raised in Rice's statement on additional grounds for review fail. State v. Majors, 94 Wn.2d 354, 356, 616 P.2d 1237 (1980).
Reversed and remanded for resentencing. The trial court may empanel a jury under our decision in State v. Fero, Wn. App., 104 P.3d 49 (2005), for fact-finding in support of an exceptional sentence.
A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record pursuant to RCW 2.06.040, it is so ordered.
HOUGHTON, P.J., concur.
The sentencing court imposed an exceptional sentence on the grounds that Rice's crime was facilitated by a breach of fiduciary duty and was a `major economic offense' because it involved a monetary loss substantially greater than typical for first degree theft. Following Blakely v. Washington, U.S., 124 S. Ct. 2531, 159 L. Ed. 2d 403 (2004), the majority concludes that these findings cannot support an exceptional sentence because they were not made by a jury or admitted by Rice. In summarily vacating Rice's exceptional sentence, the majority then follows this court's recent opinion in State v. Fero, Wn. App., 104 P.3d 49 (2005), which held that Blakely errors, i.e., increased sentencing based on facts not admitted by the defendant or found by a jury, are not subject to harmless error analysis. See State v. Brown, 147 Wn.2d 330, 341, 58 P.3d 889 (2002) (where the error concerns a misstated or omitted element of a crime, the error is harmless if the element at issue is supported by overwhelming and uncontroverted evidence). But Rice did admit that his crime involved a breach of the fiduciary duty he owed Critchlow's estate. And as to the finding that Rice's crime involved loss substantially greater than normal for first degree theft, it is true that this was not admitted by Rice. But as I set forth in my dissent in Fero, Blakely errors are procedural and, therefore, subject to harmless error analysis. Fero, 104 P.3d at 61 (Quinn-Brintnall, C.J., concurring in part and dissenting in part). Applying the harmless error test to the uncontroverted facts of this case, it does appear beyond a reasonable doubt that the jury would have found Rice's crime involved loss substantially greater than normal for first degree theft. For these reasons, I must dissent from the reversal of Rice's exceptional sentence.
Although I disagree with the conclusion that Rice's sentence must be vacated, I do agree with the majority's decision to adopt the holding and rationale of Division One's opinion in State v. Harris, 123 Wn. App. 906, 99 P.3d 902 (2004). As set forth in Harris, superior courts do have the inherent authority to empanel a jury which can find aggravating factors that would support an exceptional sentence. I add to Division One's analysis one case which was not mentioned in that opinion. In State ex rel. Herron v. Browet, Inc., 103 Wn.2d 215, 691 P.2d 571 (1984), the court addressed whether due process required the right to a jury trial under the contempt provision of the moral nuisance statute. The statute at issue required that the case be heard before a judge and without a jury. Because the statute imposed a criminal penalty, our Supreme Court concluded that the statute necessarily included the required jury trial right. The court then rejected the appellants' argument that because the statute explicitly provided that no such right existed, the statute was facially invalid:
Appellants urge this court to go further and hold that [moral nuisance statute] is unconstitutional on its face. . . .
Legislative acts are presumed to be constitutional. Wherever possible, it is the duty of this court to construe a statute so as to uphold its constitutionality.
. . . .
. . . [T]oday we hold that a jury trial is an additional due process protection which must be provided. Accordingly, we superimpose our case law requirement for a jury trial onto [the moral nuisance statute]. So construed, that statute fully meets due process requirements.
Browet, 103 Wn.2d at 219-20 (citations omitted).
At the outset, the basis for Rice's exceptional sentence must be clarified. The sentencing court found that Critchlow was a particularly vulnerable victim and concluded that Rice's crime constituted a `major economic offense.' CP at 169. In support of the `major economic offense' conclusion, the court found that Rice's crime (1) `involved multiple incidents of theft per victim and multiple victims;' (2) `involved actual monetary loss substantially greater than typical for the offense of first degree theft;' (3) `occurred throughout a lengthy period of time;' and (4) was facilitated by his `position of fiduciary duty.' CP at 169-70. Under former RCW 9.94A.390(2)(d) (1996), any one of these four facts will support the legal conclusion that a defendant's crime was a `major economic offense.' After making these five findings (one for `particularly vulnerable victim' and four for `major economic offense'), the sentencing court concluded that `because of the very large amount of the theft and the egregiousness of the Defendant's breach of fiduciary duty, a sentence of 90 months total confinement is appropriate.' CP at 171.
The sentencing court's conclusion dispels any reliance on its findings regarding victim vulnerability, multiple incidents and victims, or length of time. As such, the question in this appeal is whether Rice's exceptional sentence must be vacated because it was based on judicial findings that his crime was facilitated by a breach of fiduciary duty and involved a loss of money substantially greater than typical for first degree theft.
The guardian of the estate of an incapacitated person owes a fiduciary duty to his ward. In re Guardianship of Eisenberg, 43 Wn. App. 761, 766, 719 P.2d 187 (1986); see also S.H.C. v. Lu, 113 Wn. App. 511, 524, 54 P.3d 174 (2002) (`Whether a legal fiduciary duty exists is a question of law.'), review denied, 149 Wn.2d 1011 (2003). A fiduciary duty imposes a `duty to act with the highest degree of honesty and loyalty toward another person and in the best interests of the other person.' Black's Law Dictionary 545 (8th ed. 1999); see also Van Noy v. State Farm Mut. Auto. Ins. Co., 142 Wn.2d 784, 798 n. 2, 16 P.3d 574 (2001) (Talmadge, J., concurring) (discussing the duties of a fiduciary). Among the fiduciary duties of a guardian is to conserve and protect the estate of the ward and act for the benefit of the ward insofar as the ward's interests can be ascertained. RCW 11.92.040(4); former RCW 11.92.140 (1991). When a fiduciary's acts involve self-dealing or create a conflict of interest, a breach of fiduciary duty has occurred even if it resulted in a net benefit to the beneficiaries. In re Marriage of Petrie, 105 Wn. App. 268, 276, 19 P.3d 443 (2001).
By pleading guilty to first degree theft, Rice admitted that he wrongfully obtained or exerted unauthorized control over the property or services of another, the value of which exceeded $1,500, with intent to deprive the other of such property or services. Former RCW 9A.56.020(1)(a) (1975); RCW 9A.56.030(1)(a). In his statement on plea of guilty, Rice also admitted the following: `Between January 1, 1997 and June 10, 2002 in Clark County, Washington, I was the court-appointed guardian/conservator of Helen Critchlow. I loaned money to myself without court authority in excess of $1,500.' CP at 8. By Rice's own admission, he was the guardian of Critchlow, which by law imposed a fiduciary duty upon him. Rice admittedly broke his fiduciary duty when he loaned money to himself without authorization and with the intent to deprive Critchlow. Rice's own admissions were sufficient to impose an exceptional sentence on the basis of a breach of fiduciary duty, and as such, no judicial fact finding was necessary. There is no Blakely error where an increased sentence is based on the defendant's own admissions. Blakely, 124 S. Ct. at 2537. The majority's conclusion that Rice's exceptional sentence must be reversed because he did not admit to breaching a fiduciary duty is incorrect.
As the facts necessary to impose an exceptional sentence had been admitted by Rice, it was up to the judge to determine whether the breach of fiduciary duty was, as it concluded, sufficiently `egregious' to warrant such a sentence. State v. Van Buren, 123 Wn. App. 634, 646-48, 98 P.3d 1235 (2004) (holding that after Blakely, it is still `the responsibility of the sentencing judge to determine whether facts alleged and found are sufficiently substantial and compelling to warrant imposing an exceptional sentence').
The sentencing court also concluded that the loss of money involved supported an exceptional sentence. The court did not state, either in its oral ruling or in its written findings and conclusions, whether it considered this fact and the breach of fiduciary duty fact to be independently sufficient bases upon which it would have imposed the exceptional sentence. Where a sentencing court sets forth several grounds for an exceptional sentence but does not state whether each factor alone was adequate, the exceptional sentence must be reversed unless all factors are valid. State v. Gore, 143 Wn.2d 288, 321, 21 P.3d 262 (2001). The dispositive question in this appeal is, therefore, whether Rice's exceptional sentence must be reversed on the basis that his crime involved a loss of money substantially greater than typical for first degree theft.
In support of this finding, the sentencing court found that Rice took more than $200,000 from Critchlow's estate. It is undisputed that this factual finding was not admitted by Rice. Nor did Rice admit that whatever amount he took was substantially greater than is typical for first degree theft. As such, Rice's right under Blakely to have all facts found by a jury which would increase his sentence was violated. Under Fero, this justification for an exceptional sentence must be automatically vacated.
But applying harmless error analysis, as I believe the majority is required to do, it is my belief that the failure to submit this factual question to a jury was harmless beyond a reasonable doubt. The uncontroverted evidence established that Rice took more than $200,000 from Critchlow's estate. Rice admits as much in his opening brief. See Br. of Appellant at 8 (`Between January, 1999 and June, 2002, Rice used approximately $200,000 from Critchlow's assets). Two hundred thousand dollars is 133 times greater than the minimum threshold for first degree theft. This amount is so great that it can be said as a matter of law that any reasonable jury would find Rice's crime to involve a monetary loss substantially greater than typical for first degree theft. Because the failure to submit this factual question to a jury was harmless and because Rice did admit that he accomplished the theft through a breach of fiduciary duty, I must dissent.