PEOPLE v. SEVERNS

Reset A A Font size: Print

Court of Appeal, First District, Division 5, California.

The PEOPLE of the State of California, Plaintiff and Respondent, v. Cheryl Lynn SEVERNS, Defendant and Appellant.

No. A062928.

Decided: May 04, 1994

Daniel E. Lungren, Atty. Gen., George Williamson, Chief Asst. Atty. Gen., Ronald A. Bass, Sr. Asst. Atty. Gen., Laurence K. Sullivan, Supervising Deputy Atty. Gen., Juliet B. Haley, Deputy Atty. Gen., San Francisco, for plaintiff and respondent. Mark P. Harris, Arcata, for defendant and appellant.

I. INTRODUCTION

In this case we hold that when granting probation, a sentencing court may not require the defendant to pay restitution to the Department of Health Services, as an “indirect” victim of the offense, for Medi–Cal payments made on behalf of an injured victim.

II. BACKGROUND

Cheryl Lynn Severns caused an automobile accident while driving under the influence of alcohol.   One of the victims, a three-year-old child, sustained a deep cut to her forehead.   Treating physicians discovered that the child also had a congenital lung ailment, and removed part of one lung.   Her medical expenses, paid through Medi–Cal, totaled $24,193.48.

Severns pleaded guilty to driving under the influence and causing bodily injury (Veh.Code, § 23153, subd. (a)).  The court suspended execution of a two-year prison term and placed her on three years probation with various conditions, including restitution and six months in county jail.

The probation report had recommended restitution of $24,193.48 to the Department of Health Services for the Medi–Cal payments.   At the sentencing hearing, the court reduced this amount to $4,000—the amount the court attributed to the offense—which the court said “seems to be just and probably an amount that she was directly responsible for in the accident.”   The written probation order required Severns to pay restitution of $4,000 to the Department of Health Services pursuant to Penal Code 1 section 1203.04, subdivision (a).   The order also imposed, but stayed, a $1,000 restitution fine pursuant to Government Code section 13967, subdivision (a).

III. DISCUSSION

Severns challenges the order of restitution to the Department of Health Services for Medi–Cal payments, arguing it lacked statutory authorization.

Section 1203.1 states that a court imposing probation “shall consider whether the defendant as a condition of probation shall make restitution to the victim or the Restitution Fund” (§ 1203.1. subd. (b)), and may impose such reasonable probation conditions “as it may determine are fitting and proper to the end that justice may be done, that amends may be made to society for the breach of the law, for any injury done to any person resulting from that breach, and generally and specifically for the reformation and rehabilitation of the probationer ․” (§ 1203.1, subd. (j)).  Section 1203.04, subdivision (a), prescribes the standard for determining to whom restitution by a probationer is to be paid:  the court shall require restitution “(1) To the victim, if the crime involved a victim,” and “(2) To the Restitution Fund, if the crime did not involve a victim.”

Is the Department of Health Services entitled to restitution as a “victim” of the present crime within the meaning of section 1203.04?   It depends on how one defines the term victim.   Black's Law Dictionary gives two definitions, one narrow and the other broad.

The narrow definition is, “The person who is the object of a crime or tort, as the victim of a robbery is the person robbed.”  (Black's Law Dict. (6th ed. 1990) p. 1567, col. 2.)   That person is the direct victim of the offense.   This can include a government agency.  “When someone steals from a government agency, that agency, and the taxpayers who fund it, suffer a loss that is no less than the loss suffered by an individual whose property has been stolen.”  (People v. Crow (1993) 6 Cal.4th 952, 957, 26 Cal.Rptr.2d 1, 864 P.2d 80.)   Here, the Department of Health Services was not the object of the crime and thus is not a direct victim.

The broad definition is, “[A person] who [the] court determines has suffered pecuniary damages as [a] result of defendant's criminal activities;  that person may be [an] individual, public or private corporation, government, partnership, or unincorporated association.”  (Black's Law Dict. (6th ed. 1990) p. 1567, col. 2.)   This definition encompasses an indirect victim of an offense.   The Department of Health Services is such a victim, having sustained a pecuniary loss by making Medi–Cal payments because of the offense committed by Severns.

The issue presented is whether a probationer may be ordered under section 1203.04 to pay restitution to an indirect victim.   The case law is in conflict.

In People v. Narron (1987) 192 Cal.App.3d 724, 237 Cal.Rptr. 693, the court said a county which incurred expenses in disposing of dangerous chemicals found in the defendant's residence could be considered a victim within the meaning of section 1203.1.  “While the county was not a direct victim as in the case of tax fraud or theft of government property, restitution is not limited to direct victims.   Courts have rejected the argument ‘that a restitution condition may never be ordered in favor of anyone other than the direct victim of a crime․  [Rather] the appropriate rule ․ [is that] the propriety of a particular restitution condition must be determined by reference to the purposes of probation in light of the facts and circumstances of each case.’ ”  (Id. at pp. 732–733, 237 Cal.Rptr. 693, quoting People v. Clark (1982) 130 Cal.App.3d 371, 385, 181 Cal.Rptr. 682.)

Subsequent decisions held, under other restitution statutes, that indirect victims were not entitled to restitution.   In People v. Wardlow (1991) 227 Cal.App.3d 360, 368–371, 278 Cal.Rptr. 1, the court held there could be no restitution under section 1203.1g [restitution of treatment costs incurred by minor victim of sexual assault as condition of probation] for Medi–Cal payments for psychological treatment of child molestation victims because “the Legislature intended to include only the direct, actual victims of an assault within the restitution condition authorized by section 1203.1g.”  (Id. at p. 371, 278 Cal.Rptr. 1.)   Two other decisions held that insurance companies which paid crime victims for personal property losses were not victims entitled to restitution under Government Code section 13967, subdivision (c), upon denial of probation.  (People v. Williams (1989) 207 Cal.App.3d 1520, 1523, 255 Cal.Rptr. 778;  People v. Blankenship (1989) 213 Cal.App.3d 992, 999, 262 Cal.Rptr. 141.) 2

In People v. Foster (1993) 14 Cal.App.4th 939, 948–954, 18 Cal.Rptr.2d 1, the court upheld an order of probationer restitution to an insurance company as serving the purposes of probation.   Explaining that restitution has rehabilitative and deterrent purposes where probation is granted but a compensatory purpose where probation is denied, the court concluded it is not anomalous to treat an insurer as a victim in the former situation but not in the latter.

These conflicting cases were noted in People v. Crow, supra, 6 Cal.4th 952, 26 Cal.Rptr.2d 1, 864 P.2d 80.   In Crow, the California Supreme Court held a sentencing court was authorized by Government Code section 13967, subdivision (c), upon denial of probation, to order a defendant convicted of welfare fraud to pay restitution to the defrauded government agency.  (Id. at pp. 954–955, 26 Cal.Rptr.2d 1, 864 P.2d 80.)   The Court acknowledged the conflict concerning restitution to indirect victims, but declined to enter the fray, since the government had been a direct victim of the welfare fraud in that case.   The Court said, “We express no view on whether a defendant may be ordered to pay restitution to an indirect victim.”  (Id. at p. 958, fn. 4, 26 Cal.Rptr.2d 1, 864 P.2d 80.)

We must decide the issue avoided by the Supreme Court in Crow, within the context of section 1203.04—i.e., whether that statute authorizes restitution to an indirect victim.

Section 1203.04 was enacted in 1983 as part of a package of legislation implementing the state constitutional provision for victim restitution added by Proposition 8.  (See People v. Broussard, supra, 5 Cal.4th at p. 1073, 22 Cal.Rptr.2d 278, 856 P.2d 1134.)   The constitutional provision states:  “It is the unequivocal intention of the People of the State of California 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.  [¶] Restitution shall be ordered from the convicted persons in every case, regardless of the sentence or disposition imposed, in which a crime victim suffers a loss, unless compelling and extraordinary reasons exist to the contrary.”  (Cal. Const., art. I, § 28, subd. (b).)

There is no indication whether this language was meant to encompass indirect victims.   The provision itself is vague, and the ballot pamphlet for Proposition 8 is unilluminating.   The Legislative Analyst's discussion of restitution in the ballot pamphlet states only, “This measure would grant crime victims who suffer losses a constitutional right to receive restitution.   Except in unusual cases, convicted persons would be required to make restitution to all of their victims who suffer losses.   The extent to which restitution would be made would depend on how many convicted persons have or acquire sufficient assets to make restitution.”  (Ballot Pamp., Analysis of Prop. 8 by Legislative Analyst, Prim.Elec. (June 8, 1982) p. 32.)

The history of the implementing legislation, however, is most illuminating, indicating the Legislature was aware of the distinction between direct and indirect victims and did not intend for the latter to receive restitution under section 1203.04, subdivision (a).

The statute creates a two-track restitution system where probation is granted:  restitution is paid to the victim “if the crime involved a victim” (§ 1203.04, subd. (a)(1)), and to the Restitution Fund “if the crime did not involve a victim” (§ 1203.04, subd. (a)(2)).   This dichotomy derives from the common notion of “victimless crime,” which Black's Law Dictionary defines as “a crime which generally involves only the criminal, and which has no direct victim, as in the crime of illegal possession of drugs.”  (Black's Law Dict. (6th ed. 1990) p. 1567–1568, col. 2, italics added;  see Assem. Office of Research, analysis of Assem.Bill No. 306 (1983–1984 Reg.Sess.) [stating payment is to be made to the Restitution Fund in “the case of victimless crimes”];  People v. Fritchey (1992) 2 Cal.App.4th 829, 841, 3 Cal.Rptr.2d 585 [order of payment to Restitution Fund improper because offense “not a victimless crime”].)   In an uncodified statement of intent, the Legislature declared that payment to the Restitution Fund is appropriate for “crimes which did not involve particular victims” because “all of society is victimized and pays the price when such crimes occur.”  (Stats.1983, ch. 568, § 3, p. 2437.)

If the idea of victimless crime is generally understood to mean there is no direct victim, and the Legislature intended restitution for victimless crime to be made to the Restitution Fund, the implication is that where there are both direct and indirect victims of a particular offense, in the case of the direct victim restitution is to be made to the victim, and in the case of the indirect victim a restitution fine is to be paid to the Restitution Fund.   This alone suggests section 1203.04 does not authorize restitution to indirect victims.

But there is more.   The bill that added section 1203.04 to the Penal Code had a rival—Senate Bill No. 593—which failed.  (Sen. Bill No. 593, from Assem. without further action Nov. 30, 1984, Sen. Final Hist. (1983–1984 Reg.Sess.) p. 379;  see Sen. Republican Caucus, Digest of Assem. Bill No. 306 (1983–1984 Reg. Sess.) p. 3 [stating Senate Bill No. 593 “has already passed the Senate but is not being moved through the Assembly due to the preference of the Chairman of Assembly Criminal Law and Public Safety Committee for the Assembly restitution package”].)   Senate Bill No. 593 would have created a system of restitution in which all restitution payments would be deposited into an Indemnity Fund against which the “victim” could file a claim.  (Sen.Bill No. 593 (1983–1984 Reg.Sess.) as amended July 15, 1983, § 2, p. 5, § 4, p. 12.)  “Victim” was defined as “the individual, association, corporation, or any other entity, public or private who or which suffers personal injury or property damage or loss caused, directly or indirectly, as the result of the commission by the defendant ․ of the crime․”  (Sen.Bill No. 593 (1983–1984 Reg.Sess.) as amended July 15, 1983, § 2, p. 7, § 4, p. 11, italics added.)

 Thus, the failed bill expressly provided for restitution to victims who suffered indirect losses—that is, to indirect victims.   The successful bill did not.   A general rule of statutory construction is that unpassed bills have little value as evidence of the intent underlying the legislation of an earlier legislative session.  (Marina Point, Ltd. v. Wolfson (1982) 30 Cal.3d 721, 735, fn. 7, 180 Cal.Rptr. 496, 640 P.2d 115;  Bell v. Department of Motor Vehicles (1992) 11 Cal.App.4th 304, 313, 13 Cal.Rptr.2d 830.)   But contemporaneous unpassed legislation may be a significant indicator of the intent underlying legislation passed at the same session.  (See Dyna–Med, Inc. v. Fair Employment & Housing Com. (1987) 43 Cal.3d 1379, 1396, 241 Cal.Rptr. 67, 743 P.2d 1323 [simultaneous passage of legislation empowering one government agency to award damages and rejection of legislation that would have similarly empowered another agency raised “strong inference” of legislative intent to withhold the authority from the latter];  cf. Silva v. Superior Court (1993) 14 Cal.App.4th 562, 570, 17 Cal.Rptr.2d 577 [Legislature's rejection of specific provision contained in act as originally introduced indicates act should not be construed to include omitted provision].)

The failure of Senate Bill No. 593 indicates the Legislature knowingly rejected restitution to indirect victims when enacting section 1203.04 without the indirect victim restitution provision contained in the failed bill.   For this reason, and because of the implications of the notion of “victimless crime” underlying the two-track restitution system created by section 1203.04, we conclude that probationer restitution in the case of an indirect victim is to be paid only to the Restitution Fund.

We therefore disagree with People v. Narron, supra, 192 Cal.App.3d at pages 732–733, 237 Cal.Rptr. 693, to the extent the court said a probationer may be required to pay restitution to an indirect victim.  Narron did not consider the legislative history of section 1203.04.   Instead, the court relied on People v. Clark (1982) 130 Cal.App.3d 371, 385, 181 Cal.Rptr. 682, which rejected an argument that probationer restitution was limited to direct victims and said “the propriety of a particular restitution condition must be determined by reference to the purposes of probation in light of the facts and circumstances of each case.”  (See People v. Narron, supra, 192 Cal.App.3d at pp. 732–733, 237 Cal.Rptr. 693.)   But Clark predated section 1203.04.   At the time Clark was decided, victim restitution was addressed only by section 1203.1, which stated that a court imposing probation “shall consider whether the defendant as a condition of probation shall make restitution to the victim or the Indemnity Fund․  (51 West's Ann.Pen.Code (1982 ed.) § 1203.1, p. 195.)   Thus, Clark is not helpful in construing the later-enacted “victim” standard prescribed by section 1203.04, subdivision (a), for determining to whom restitution is to be paid.  Narron also relied on People v. Calhoun (1983) 145 Cal.App.3d 568, 572, 193 Cal.Rptr. 394, which upheld an order of probationer restitution to an automobile accident victim's insurer.  (See People v. Narron, supra, 192 Cal.App.3d at p. 733, 237 Cal.Rptr. 693.)   But Calhoun also predated section 1203.04 and was based solely on section 1203.1, which Calhoun concluded “does not expressly limit payment to immediate victims.”  (People v. Calhoun, supra, 145 Cal.App.3d at p. 572, 193 Cal.Rptr. 394.)   The pronouncements in Clark and Calhoun on indirect victim restitution might have been sound in their time, under the general language of section 1203.01, but the victim standard subsequently prescribed by section 1203.04, as properly construed in light of the latter statute's legislative history, made those pronouncements obsolete by the time Narron was decided.

We also part with People v. Foster, supra, 14 Cal.App.4th 939, 18 Cal.Rptr.2d 1, to the extent the court upheld probationer restitution to an insurance company.   As in Narron, the court in Foster did not consider the history of section 1203.04, which indicates legislative intent to make restitution payable only to the Restitution Fund in the case of an indirect victim.

 We therefore hold the court erred in ordering Severns to pay $4,000 to the Department of Health Services.   That agency was not entitled to restitution as a “victim” within the meaning of section 1203.04, subdivision (a)(1).3

 The People contend Severns waived any error by failing to object below to the restitution order.  (See People v. Welch (1993) 5 Cal.4th 228, 19 Cal.Rptr.2d 520, 851 P.2d 802.)   Because we conclude the court lacked authority to order payment of restitution to the Department of Health Services—i.e., the error was jurisdictional—we find no waiver.   Jurisdictional error is not waived on appeal by failure to assert it below.  (People v. Zito (1992) 8 Cal.App.4th 736, 741–742, 10 Cal.Rptr.2d 491;   People v. Williams, supra, 207 Cal.App.3d at p. 1524, 255 Cal.Rptr. 778.)

The appropriate remedy is to strike the order of restitution to the Department of Health Services but remand the cause for a further hearing to permit the court to reconsider the restitution fine imposed but stayed under Government Code section 13967, subdivision (a).   Based on our determination that restitution for Medi–Cal's loss is payable only to the Restitution Fund, the court might well decide on remand to increase the amount of the restitution fine commensurate with the extent of the Medi–Cal loss, to remove the stay, or to employ some combination of both.   In People v. Blankenship, supra, 213 Cal.App.3d 992, 262 Cal.Rptr. 141, the court opted against such remand upon striking an award of $3,792.87 to an insurer, explaining, “We believe it is judicially uneconomical to do so because of the further hearings this would necessitate and the small financial benefit to be gained, if any.”  (Id. at p. 1000, fn. 10, 262 Cal.Rptr. 141.)   We do not, however, consider the sum of $4,000 to be of small financial benefit to the Restitution Fund.

IV. DISPOSITION

The order of restitution to the Department of Health Services is stricken, and the cause is remanded for a further hearing to reconsider the restitution fine imposed but stayed under Government Code section 13967, subdivision (a).   In all other respects, the probation order is affirmed.

FOOTNOTES

FN1. Further statutory references are to the Penal Code, unless otherwise stated..  FN1. Further statutory references are to the Penal Code, unless otherwise stated.

2.   Williams and Blankenship relied in part on the definitions of “victim” in Government Code section 13960.   That reliance was undermined by People v. Broussard (1993) 5 Cal.4th 1067, 22 Cal.Rptr.2d 278, 856 P.2d 1134 and People v. Crow, supra, 6 Cal.4th 952, 26 Cal.Rptr.2d 1, 864 P.2d80, which held that the definition of victim in Government Code section 13960 does not apply to section 13967, subdivision (c).  (See People v. Bruce (1994) –––Cal.App.4th ––––, –––– – ––––, 30 Cal.Rptr. 303.)

3.   Consequently, we do not reach Severns's alternative argument that the court erred by omitting to determine her ability to pay victim restitution.

KING, Associate Justice.

PETERSON, P.J., and HANING, J., concur.