P. v. Martin

Filed 12/23/09 P. v. Martin CA2/6

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SIX

Cory Michael Martin vandalized a Lotus sports car on display at a car dealership. He pled no contest to a charge of felony vandalism (Pen. Code,[1] 594, subd. (b)(1)) and was granted probation. At the probation hearing, it was established that the victim had lost $27,370.05 on the sale of the Lotus as a direct result of the vandalism. The People also submitted evidence that as the direct and sole result of the victim's claim for and recovery of those losses under its liability insurance policy, its annual insurance premium had increased by $8,200. As a term and condition of Martin's probation, he agreed to pay both amounts as victim restitution. He now appeals, contending that the court abused its discretion in ordering him to pay the victim's increased insurance premium. In light of the trial court's broad discretion to award victim restitution as a condition of probation (People v. Giordano (2007) 42 Cal.4th 644, 663, fn. 7), we affirm.

FACTS AND PROCEDURAL HISTORY

Because Martin pleaded no contest prior to trial, the relevant facts are derived from the preliminary hearing transcript and probation report. On March 29, 2007, Mr. Mendoza, an employee at the Smith Volvo car dealership in San Luis Obispo, was driving by the dealership's lot with his wife when he saw a man holding a rock as he stood next to a Lotus Elise. After Mendoza's wife turned their car around, Mendoza saw the man walking up the street. Mendoza called the police. San Luis Obispo Police Officer Sean Gillham responded to the lot and discovered that the body and windshield of the Lotus had been "smashed" with a very large rock that remained inside the vehicle.

Martin was apprehended approximately two blocks away from the scene. In an infield showup, Mendoza said he was "fairly certain" Martin was the person he had seen standing next to the Lotus. Shards of glass found in Martin's sweatshirt and shoes were consistent with the broken glass from the Lotus. Martin also had abrasions on the inside of his forearms that were consistent with holding the large rock used to vandalize the vehicle.

After Martin was arrested and given Miranda[2] advisements, he said he had been drinking hard liquor at the restaurant where he worked, which is about one block away from Smith Volvo. He recalled vandalizing the Lotus, although he did not remember picking up the rock. Tests subsequently revealed that Martin's blood alcohol level was .28 percent.

DISCUSSION

In requesting restitution on behalf of Smith Volvo, the probation officer attached a letter memorandum prepared by owner Brent Smith reflecting a loss of $27,370.05 incurred on the sale of the Lotus vehicle that Martin vandalized.[3] The memorandum also states that Smith Volvo had received $21,371.18 in reimbursement from its insurer, Sentry Select Insurance Company (Sentry). The memorandum further notes that "[d]ue to the fact that a large claim was made against our insurance, our rates have increased substantially and this 'higher rate' will remain in effect for the next three years." As proof of the increased premium, the People submitted an investigative report prepared by District Attorney Investigator Casey Neall that memorializes Neall's telephonic discussion with Steve Knodell, Sentry's Director of Underwriting. Neall states: "I discussed this case with Knodell, and more specifically the increase in premium for Smith Volvo's insurance policy, due to the claim stemming from the vandalism in this case. Knodell told me that based solely on the claim from the vandalism in this case[,] Smith Volvo's premium was raised approximately $8,200.00."

Based on this evidence, the court ordered Martin to pay a total of $35,570.05 in victim restitution, consisting of $27,370.05 for the loss on the sale of the Lotus plus $8,200 for the increased insurance premium.[4] Martin contends the court erred in including the $8,200 because (1) the only evidence of the loss was contained in a multiple hearsay report submitted by a district attorney investigator; (2) he was not given a meaningful opportunity to contest the amount or the evidence submitted because neither Neall nor Knodell was made available for cross-examination; (3) the award does not reimburse the victim, but rather its insurer; and (4) the award amounts to double recovery. None of these contentions has merit.

The victim restitution order at issue here is governed by sections 1202.4 and 1203.1. The Legislature enacted section 1202.4 in implementing Proposition 8, also known as the Victims' Bill of Rights, which was passed by California voters in 1982. (People v. Giordano, supra, 42 Cal.4th at p. 652.) Subdivision (f) of the statute provides in pertinent part: "[I]n every case in which a victim has suffered economic loss as a result of the defendant's conduct, the court shall require that the defendant make restitution to the victim or victims in an amount established by court order, based on the amount of loss claimed by the victim or victims or any other showing to the court. . . . The court shall order full restitution unless it finds compelling and extraordinary reasons for not doing so, and states them on the record. . . . [] (3) To the extent possible, the restitution order . . . shall be of a dollar amount that is sufficient to fully reimburse the victim or victims for every determined economic loss incurred as the result of the defendant's criminal conduct, including, but not limited to" 11 enumerated categories. The statute is a codification of the voters' "unequivocal intention" to ensure "that all persons who suffer losses as a result of criminal activity shall have the right to restitution from the persons convicted of the crimes for losses they suffer." (Cal. Const., art. I, 28, subd. (b); In re T.C. (2009) 173 Cal.App.4th 837, 844, fn. 4.)

"The standard of review of a restitution order is abuse of discretion. 'A victim's restitution right is to be broadly and liberally construed.' [Citation.] '"When there is a factual and rational basis for the amount of restitution ordered by the trial court, no abuse of discretion will be found by the reviewing court."' [Citations.]" (In re Johnny M. (2002) 100 Cal.App.4th 1128, 1132.) "In reviewing the sufficiency of the evidence [to support a factual finding], the '"power of the appellate court begins and ends with a determination as to whether there is any substantial evidence, contradicted or uncontradicted," to support the trial court's findings.' [Citations.] Further, the standard of proof at a restitution hearing is by a preponderance of the evidence, not proof beyond a reasonable doubt. [Citation.] 'If the circumstances reasonably justify the [trial court's] findings,' the judgment may not be overturned when the circumstances might also reasonably support a contrary finding. [Citation.] We do not reweigh or reinterpret the evidence; rather, we determine whether there is sufficient evidence to support the inference drawn by the trier of fact. [Citations.]" (People v. Baker (2005) 126 Cal.App.4th 463, 468-469.) In exercising its broad discretion to impose victim restitution, the court "may use any rational method of fixing the amount of restitution as long as it is reasonably calculated to make the victim whole. [Citations.]" (Id. at p. 470.)

The trial court's discretion to order victim restitution is even greater where, as here, the defendant is granted probation: "While we review all restitution orders for abuse of discretion, we note that the scope of a trial court's discretion is broader when restitution is imposed as a condition of probation. Penal Code section 1203.1, subdivision (j) expressly grants trial courts broad discretion in imposing conditions of probation. As this court has held, '[a] condition of probation will not be held invalid unless it "(1) has no relationship to the crime of which the offender was convicted, (2) relates to conduct which is not in itself criminal, and (3) requires or forbids conduct which is not reasonably related to future criminality . . . ." ' [People v. Lent (1975) 15 Cal.3d 481, 486.] With respect to the third criterion, 'an order for restitution, i.e., attempting to make a victim whole, has generally been deemed a deterrent to future criminality [citation], and the court is not limited to the transactions or amounts of which defendant is actually convicted [citations].' (Ibid.) Probationary restitution may be imposed even if a defendant has not been convicted for a particular offense 'because probation is an "'"act of clemency and grace,"'" not a matter of right. [Citation.] "[T]he granting of probation is not a right but a privilege, and if the defendant feels that the terms of probation are harsher than the sentence for the substantive offense[,] he is free to refuse probation." [Citations.] Because a defendant has no right to probation, the trial court can impose probation conditions that it could not otherwise impose, so long as the conditions are not invalid under the three Lent criteria.' [Citation.]" (People v. Giordano, supra, 42 Cal.4th at p. 663, fn. 7.)[5]

The court did not abuse its broad discretion in ordering Martin to pay the increase in Smith Volvo's insurance premium as a term and condition of his probation. For purposes of section 1202.4, "'the word "loss" must be construed broadly and liberally to uphold the voters' intent.' [Citation.] Because the statute uses the language 'including, but not limited to' these enumerated losses, a trial court may compensate a victim for any economic loss which is proved to be the direct result of the defendant's criminal behavior, even if not specifically enumerated in the statute. [Citation.]" (People v. Keichler (2005) 129 Cal.App.4th 1039, 1046.) Moreover, the primary purpose of restitution is to restore the status quo by making the victim whole for any losses suffered as a result of the defendant's conduct. (People v. Giordano, supra, 42 Cal.4th at p. 658; People v. Baker, supra, 126 Cal.App.4th at p. 470.)

Smith Volvo offered evidence demonstrating that its insurance premium had increased by approximately $8,200 as a direct and sole result of its claim for recovery of the losses caused by Martin's criminal conduct. The court had the discretion to conclude that this financial obligation falls within the broad range of unenumerated crime victim losses that voters intended to protect against in passing Proposition 8. (Cal. Const., art. I, 28, subd. (b); People v. Giordano, supra, 42 Cal.4th at p. 658.) Moreover, we have no authority to invalidate the order unless it bears no relationship to the crime of which Martin was convicted, relates to conduct that was lawful, and is not reasonably related to his future criminality. (Giordano, supra, at p. 663, fn. 7; People v. Lent, supra, 15 Cal.3d at p. 486.) None of these factors can be found true, much less all three of them.

The increase in the victim's insurance premium is plainly related to the vandalism of which Martin was convicted. In rejecting a defendant's claim that the physical damage he caused in a traffic accident was not reasonably related to his crime of leaving the scene of the accident (Veh. Code,  20002, subd. (a)), our Supreme Court reasoned that "[a]mong other things, the crime imposes on the nonfleeing driver the additional costs of locating the fleeing driver and, in some cases, the total costs of the accident. 'The cost of a "hit and run" violation is paid for by every law-abiding driver in the form of increased insurance premiums. . . .' [Citation.] The lack of a precise fit between the costs of the crime and the amount of restitution ordered does not render the restitution order invalid, if it serves a purpose described in Penal Code section 1203.1." (People v. Carbajal (1995) 10 Cal.4th 1114, 1124.) Similarly, any attenuation between the loss Martin's victim incurred in selling the property he vandalized and the increased insurance premium it had to pay as a result of claiming that loss does not render the restitution order invalid. Smith Volvo's increased premium is a real and tangible loss that was occasioned by Martin's illegal conduct. Because the loss bears a close relationship to Martin's crime, the court had discretion to order him to include that loss in the restitution order.

The court could also properly conclude that ordering Martin to make Smith Volvo whole by restoring the status quo would serve the rehabilitative purpose contemplated by section 1203.1. The order compels Martin to confront the reality that his conduct has repercussions beyond what he may have contemplated. "'Restitution is an effective rehabilitative penalty because it forces the defendant to confront, in concrete terms, the harm his actions have caused. Such a penalty will affect the defendant differently than a traditional fine, paid to the State as an abstract and impersonal entity, and often calculated without regard to the harm the defendant has caused. Similarly, the direct relation between the harm and the punishment gives restitution a more precise deterrent effect than a traditional fine.' [Citation.]" (People v. Carbajal, supra, 10 Cal.4th at p. 1124.)

Martin also fails to demonstrate that the evidence is insufficient to sustain the court's finding that Smith Volvo's insurance premium increased by $8,200 as a result of his criminal conduct. Restitution is ordered "based on the amount of loss claimed by the victim or victims or any other showing to the court." ( 1202.4, subd. (f).) As we have noted, the People submitted evidence that Smith Volvo's insurance premium had increased by $8,200 "based solely on the claim from the vandalism." Once Smith Volvo made a prima facie showing that it had suffered this loss, the burden shifted to Martin to rebut that showing. (People v. Prosser (2007) 157 Cal.App.4th 682, 691; People v. Fulton(2003) 109 Cal.App.4th 876, 886.) Martin failed to meet that burden. While he complains that the proof of the increased insurance premium is contained in a "hearsay upon hearsay report," the ordinary rules of evidence do not apply to restitution hearings. In ordering restitution, "'". . . judges are given virtually unlimited discretion as to the kind of information they can consider and the source from whence it comes." . . .' [Citation.] [] This is so because a hearing to establish the amount of restitution does not require the formalities of other phases of a criminal prosecution. [Citation.]" (People v. Foster (1993) 14 Cal.App.4th 939, 947, superseded by statute on another ground as stated in People v. Birkett (1999) 21 Cal.4th 226, 238-245.) The court need only ensure that the procedure employed to determine the amount of restitution is not fundamentally unfair. (People v. Cain (2000) 82 Cal.App.4th 81, 87.) This duty is discharged where the court relies on hearsay statements contained in reports or other documents that are inherently reliable. (Ibid.)

The report at issue here is inherently reliable because it was prepared by a district attorney investigator as part of his official duties. (People v. Cain, supra, 82 Cal.App.4th at pp. 87-88.) In addition, the statement that Smith Volvo's insurance premium would increase by $8,200 was made by the person in the best position to know that information. The statement's veracity is also bolstered by the fact that it was made to a district attorney investigator with knowledge it would be relied on in a court of law. Moreover, Martin made no effort to rebut it. When the court asked Martin's attorney whether he wanted "to set a hearing . . . to adjudicate the [$]8,200," counsel responded, "No, I think we can just argue it now, and the court can make a decision based on the argument." Martin thereby effectively waived the right to complain on appeal that he had no opportunity to challenge the evidence. To the extent he claims that he had a right to cross-examine Neall and Knodell, the law is to the contrary. (Cain, supra, at pp. 86-87.)

We also reject Martin's claims that the award effectively compensates the victim's insurer and amounts to double recovery. As the People aptly note, these claims "mischaracterize the nature of restitution and insurance." Martin simply offers no support for his assertion that Sentry's payment to Smith Volvo was the legal equivalent of "a loan to be paid back over three years" that Smith Volvo will ultimately pay back "under the guise of a premium increase." The evidence adduced at the restitution hearing shows that Smith Volvo will have to pay (and by now certainly has paid) $8,200 in increased insurance premiums as a result of Martin's vandalism, and Martin offered no evidence to rebut that showing. The trial court therefore did not abuse its discretion in ordering Martin to reimburse Smith Volvo for the loss as a condition of his probation.

Ordering Martin to reimburse Smith Volvo for the increase in its premium does not transform Sentry into a direct victim. In arguing otherwise, Martin misses the point that Sentry will receive its increased premium from Smith Volvo regardless of the result here. Following Martin's logic, he should not be ordered to pay for Smith Volvo's loss on the sale of the Lotus as restitution because Sentry will likely receive the majority of that amount as reimbursement under its indemnification agreement with Smith Volvo. Of course, that is not the law. Despite insurance, a court is required to order restitution to the victim in "the full amount of the loss caused by the crime, regardless of whether, in the exercise of prudence, the victim had purchased private insurance that covered some or all of the same losses." (People v. Birkett, supra, 21 Cal.4th at p. 246.) The result Martin seeks would serve to discourage victims from making claims under their insurance policies for their losses, for it would put them in a worse position than if they had simply recovered those losses through restitution. Simply put, as a consequence of exercising its right to recover under its insurance policy for losses caused by Martin, Smith Volvo is out an additional $8,200. As we have noted, the primary purpose of restitution is to restore the status quo, i.e., to place the victim in the position it would have been in if the crime had not been committed. (People v. Giordano, supra, 42 Cal.4th at p. 658.)

There is no suggestion here that Smith Volvo did not actually incur the cost of the increased premium. Moreover, the court did not have to find the loss was necessarily incurred in ordering Martin to reimburse Smith Volvo for that loss as restitution. (See People v. Moore (2009) 177 Cal.App.4th 1229 [no abuse of discretion in ordering defendant to pay victim for wages lost while attending trial proceedings he was not obligated to attend].) Besides, even if Smith Volvo could have shopped for another insurer, there is no evidence (1) that it did not in fact do so; (2) that a lesser premium could have been obtained from another insurer; or (3) that the increased premium is unreasonable by industry standards. The People were not obligated to present any such evidence on Smith Volvo's behalf. Once a prima facie showing of the increased premium was presented, the burden shifted to Martin to produce evidence that Smith Volvo's payment of it was unnecessary or unreasonable. (People v. Prosser, supra, 157 Cal.App.4th at p. 691; People v. Fulton, supra, 109 Cal.App.4th at p. 886.) Were we to conclude otherwise, we would have to agree that a victim seeking restitution for medical expenses incurred as a result of a defendant's criminal conduct must prove not only that the claimed expenses were not excessive, but also that less expensive treatment was unavailable. Similarly, a victim who decided to forego making an insurance claim for injuries suffered as a result of a defendant's conduct would not be entitled to restitution for his or her medical expenses if the defendant could prove that less expensive treatment could have been obtained through the insurer. These results would be contrary to the purpose and intent of the Victims' Bill of Rights, which is to ensure that crime victims are fully compensated for any and all losses they actually incur.

To the extent Martin takes issue with the insurance industry's apparently widespread practice of raising its insureds' premiums after a claim is made, any dispute with that practice must be resolved by the Legislature. Smith Volvo certainly has the right to choose its own insurance provider, and the possibility that it may have been able to obtain coverage for a lesser premium is pure speculation. Moreover, disallowing Smith Volvo's recovery of its increased premium could have the effect of discouraging victims from making insurance claims for their losses, a result that would be plainly contrary to public policy.

CONCLUSION

The citizens of California have, through the initiative process, made clear that those who commit crimes will be held accountable for the economic damage they inflict. By ordering restitution, whether incidental to a prison commitment or as a condition of probation, the law provides for a fair, prompt and immediate means for requiring the criminal agent to make the victim whole by restoring the status quo. In turn, the culprit is held accountable and given a forum to contest the nature and amount of damages imposed. The appellate court reviews these orders for an abuse of discretion, and no such abuse appears in the instant matter.

The judgment (order of restitution) is affirmed.

NOT TO BE PUBLISHED.

PERREN, J.

We concur:

GILBERT, P.J.

YEGAN, J.

Jac Crawford, Judge

Superior Court County of San Luis Obispo

______________________________

Susan B. Gans-Smith, under appointment by the Court of Appeal, for Defendant and Appellant.

Edmund G. Brown Jr., Attorney General, Dane R. Gillette, Chief Assistant Attorney General, Pamela C. Hamanaka, Senior Assistant Attorney General, Paul M. Roadarmel, Jr., Supervising Deputy Attorney General, Rama R. Maline, Deputy Attorney General, for Plaintiff and Respondent.

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[1] All further undesignated statutory references are to the Penal Code.

[2]Miranda v. Arizona(1966) 384 U.S. 436.

[3] The memorandum states that the Lotus was valued at $52,370.05, and had been sold in its damaged condition to a third party for $25,000.

[4] The court initially determined that the $8,200 represented the total of Smith Volvo's increased insurance premium for the following three years, which amounted to $2,733.33 for each year. The prosecutor stated that Smith had told him the premium would be increased by $8,200 in each of the following three years, for a total of $24,600. The prosecutor asked Smith to provide documentation of this, but he never did. The prosecutor then informed the court that he was only seeking restitution for the first year's increased premium. The court ordered restitution accordingly. The propriety of the court's decision to refrain from awarding Smith Volvo an additional $16,400 in restitution (i.e., $8,200 for each of the second and third years) is not before us.

[5] Neither party's briefs specifically addressed the propriety of the court's authority to order Martin to pay the increased insurance premium as a condition of probation under section 1203.1, subdivision (j). After the matter was submitted following oral argument, we vacated submission and requested supplemental briefing on the issue.