The PEOPLE, Plaintiff and Appellant, v. Rodney JOHNSON et al., Defendants and Respondents.
A nine-count information was filed by the Kern County District Attorney on November 11, 1985, charging respondents, Rodney Johnson and Richard Phillips with two counts of grand theft from the person in violation of Penal Code section 487,1 subdivision 2 (counts I and V); two counts of conspiracy to commit theft in violation of section 182 (counts II and VI); two counts of misappropriation of public money in violation of section 424, subdivision 2 (counts III and VII); and two counts of embezzlement by a public officer in violation of section 504 (counts IV and VIII). One felony count of receiving stolen property in violation of section 496 was alleged against respondent Phillips only (count IX).
A preliminary examination of the nine-count information was held and the magistrate determined the evidence was insufficient to hold the respondents to answer on those counts alleging a violation of sections 424 and 504, i.e., counts III, IV, VII and VIII.
An information was filed realleging all nine counts, including those alleging violations of sections 424 and 504. On January 2, 1986, respondent Johnson filed in the superior court a motion to set aside counts III, IV, VII and VIII of the information. Phillips joined in the motion. Upon hearing the motion, the court granted the motion and accordingly set aside those four counts.
A timely notice of appeal was filed by the People of the State of California (People).
On June 21, 1985, Augustin Velarde was in his Chevrolet pickup truck traveling toward Wasco with Gustavo and Jesus Martinez. Between 10 and 10:30 p.m., as they were traveling between Lost Hills and Highway 5 in Kern County, they were signaled to pull over for speeding by two Highway Patrol officers in a regularly marked Highway Patrol car. Velarde later identified the officers as respondents Johnson and Phillips. During his testimony, Velarde admitted he had been speeding.
Johnson asked Velarde for his driver's license. Velarde took his license from his wallet and handed it to Johnson. Johnson took the driver's license to the patrol car while Phillips stayed at the passenger side of the truck. Johnson used the police radio, then returned and requested another form of identification from Velarde. Johnson asked Velarde for his wallet and then returned to the patrol car where he wrote out a traffic citation.
After Johnson returned his wallet, Velarde testified he noticed $160 was missing. Velarde told Gustavo and Jesus Martinez that some money was missing and he intended to report the theft to the Highway Patrol. On Monday, June 24, Velarde reported the alleged theft to Highway Patrol Sergeant Ederra. Thereafter, Ederra, Lieutenant Hunt and Captain Skidmore of the Highway Patrol met with the chief and deputy chief of the Bakersfield Police Department regarding a decoy operation and decided Bakersfield Police Detective Munoz would present himself as a non-English-speaking person with a nonoperating vehicle apparently involved in a traffic accident. The circumstances would be such that there would be an opportunity for a search of Munoz but insufficient cause for a custodial arrest.
At approximately 10:45 p.m. that same day, Munoz dressed in “typical field laborer” clothing, lodged his car on top of a mound of dirt in a construction area on Seventh Standard Road in Kern County and disconnected a battery cable. He consumed a 12–ounce bottle of beer.
Munoz had a clear plastic bag, allegedly containing $530 wrapped around a wallet. Munoz also carried a traffic citation made out to a fictitious Edwardo Lopez which was intended to satisfy the officers as to Munoz's identity.
Thereafter, a Highway Patrol car containing respondents, stopped near Munoz's car. Johnson exited and asked Munoz for identification. Munoz replied in Spanish that he did not possess any identification. Johnson then patted Munoz down. Johnson apparently felt the packet in Munoz's left front pants pocket, reached in and pulled the packet out. Johnson then carried the package to the patrol car while Phillips stayed with Munoz. Phillips administered a sobriety test and looked inside the car's glove box. At some point, Phillips returned to the patrol car and peered in at Johnson who was seated on the passenger side. Johnson reattached the battery cable Munoz had removed and Phillips drove the car off the dirt mound. Then Johnson and Phillips looked inside the car's engine compartment. Phillips asked Johnson if he was going to return Munoz's packet. Johnson replied in the affirmative. Phillips then asked Johnson, “Did you keep it all?” Johnson replied, “No, just a little bit.”
Phillips recommended Munoz leave the area indicating the Border Patrol would be arriving soon. Munoz's packet was pointed out to him as being on the driver's seat of his car.
Munoz drove a short distance away, counted the money, and discovered $200 were missing.
Respondents were arrested and searched. Found in Johnson's shirt pocket, pants pocket and socks were $160 in $20 bills with serial numbers matching the bills given to Munoz. Three $10 bills taken from Munoz were found in Phillips's shirt pocket.
WHETHER THE EVIDENCE PRESENTED AT THE PRELIMINARY HEARING WAS SUFFICIENT TO HOLD RESPONDENTS TO ANSWER FOR VIOLATIONS OF SECTION 424 AND 426
As previously stated, the magistrate declined to hold respondents to answer for violations of sections 424 and 504. The People then filed an information which alleged violations of sections 424 and 504 as authorized by section 739. The superior court granted respondents' motion pursuant to section 995 and set aside those charges. The People now contend that under the appropriate standard of review, there was sufficient evidence to support the dismissed charges and seek to have the charges reinstated.
A. STANDARD OF REVIEW
The record here presents no conflicts in the evidence and the magistrate rendered no findings of fact. We are to review the magistrate's order in this case as an issue of law, that is, whether the evidentiary record contains facts to establish sufficient cause to hold respondents for misappropriation of public money pursuant to section 424 and embezzlement by a public officer pursuant to section 504.
An information should not be set aside or prosecution thereon prohibited if there is some rational ground for assuming the possibility an offense has been committed and the accused is guilty of it. (People v. Slaughter (1984) 35 Cal.3d 629, 637, 200 Cal.Rptr. 448, 677 P.2d 854.)
The magistrate is not a trier of fact. He does not decide whether a defendant committed a crime, but only whether there is “ ‘some rational ground for assuming the possibility that an offense has been committed and the accused is guilty of it.’ ” (People v. Orin (1975) 13 Cal.3d 937, 947, 120 Cal.Rptr. 65, 533 P.2d 193.)
“The term ‘sufficient cause’ is generally equivalent to ‘reasonable and probable cause,’ that is, such a state of facts as would lead a man of ordinary caution or prudence to believe and conscientiously entertain a strong suspicion of the guilt of the accused.” (People v. Uhlemann (1973) 9 Cal.3d 662, 667, 108 Cal.Rptr. 657, 511 P.2d 609.) On appeal, the issue must receive the “independent scrutiny appropriate for review of questions of law.” (People v. Slaughter, supra, 35 Cal.3d at p. 638, 200 Cal.Rptr. 448, 77 P.2d 854.)
B. SECTIONS 424 and 426
Section 424, subdivision 2, provides:
“Each officer of this state, or of any county, city, town, or district of this state, and every other person charged with the receipt, safekeeping, transfer, or disbursement of public moneys, who either:
“2. Loans the same or any portion thereof; makes any profit out of, or uses the same for any purpose not authorized by law; ․
“is punishable by imprisonment in the state prison for two, three or four years, and is disqualified from holding any office in this state.
“As used in this section, ‘public moneys' includes the proceeds derived from the sale of bonds or other evidence of indebtedness authorized by the legislative body of any city, county, district, or public agency.”
Section 426 provides:
“The phrase ‘public moneys,’ as used in the two preceding sections, includes all bonds and evidence of indebtedness, and all moneys belonging to the state, or any city, county, town, district, or public agency therein, and all moneys, bonds, and evidences of indebtedness received or held by state, county, district, city, town, or public agency officers in their official capacity.” (Emphasis added.)
Although respondents dispute the assertion that California Highway Patrol officers are officers of the state, the provisions of Vehicle Code section 2409 clearly provides Highway Patrol officers have the powers of a peace officer as provided in section 830.2.2 (See also People v. Schramling (1987) 192 Cal.App.3d 989, 994, 238 Cal.Rptr. 8; Estrada v. Indemnity Ins. Co. (1958) 158 Cal.App.2d 129, 134, 322 P.2d 294.) The real question presented here is whether the money allegedly missing from the wallets of Velarde and Munoz were “public moneys” as defined by section 426. “Public moneys” includes, inter alia, money belonging to the state and money held by an officer in his official capacity. The People argue the money, even though owned by private persons, can be “public money” if it is in the temporary custody of a public official.
The People cite several cases to support their position. In our view, these cases are factually distinguishable from the instant case and will not support the People's argument. In People v. Best (1959) 172 Cal.App.2d 692, 342 P.2d 314, bail money was paid by a prisoner while in a building housing the city police headquarters and the jail to a police officer in charge of, and assigned to the duty of, receiving and transmitting bail money. The police officer received a person arrested on a bench warrant and accepted bail money from a friend of the arrestee. The defendant never booked the arrestee, as his duties required, but simply released the arrestee on receipt of the money, which he pocketed and spent for his own purposes. The court held the money received came within the term “public moneys” as defined in section 426 and the police officer was guilty of embezzlement under section 424, making the improper appropriation of public moneys by a public officer unlawful. (Id. at pp. 694–695, 342 P.2d 314.) The court held that the official character in which the money was received was the true criterion of whether or not it should be considered public money. (Id. at p. 695, 342 P.2d 314.)
In People v. Griffin (1959) 170 Cal.App.2d 358, 338 P.2d 949, a case also relied upon by the People, the defendant was a deputy municipal court clerk authorized to receive bail money sent by mail for traffic offenses. In numerous cases the clerk received the bail money but failed to deliver it to the court as required. The defendant argued on appeal that the money was not “public money” because there had been no order of forfeiture in any of the cases and the money belonged to the persons who deposited it. The court rejected the defendant's argument and found the deposits were “public moneys” received in the defendant's official capacity. (Id. at pp. 362–363, 338 P.2d 949.) The court noted that the official character in which the moneys are received or held is the proper criterion of whether or not they are “public moneys” under said section 424. “Ultimate ownership is not a proper criterion. (People v. Crosby [ (1956) ] 141 Cal.App.2d 172, 175 [296 P.2d 438]․)” (Id. at p. 363, 338 P.2d 949.)
In Crosby, the defendant was a public administrator of San Mateo County who took money from estates entrusted to him. The court held that although the money was not government property, it was “public moneys” since it was received and held by the defendant in his official capacity. (People v. Crosby (1956) 141 Cal.App.2d 172, 174–175, 296 P.2d 438.)
In the instant case, the People contend the misappropriated moneys were received and held by respondents in their official capacity since they were on duty, in uniform, with an official patrol vehicle and issued victim Velarde a notice to appear, inferably using an official form. The People further contend victim Munoz was off the road in an apparently disabled vehicle and the officers approached him in the line of duty. Asking Munoz for identification and finding he had been driving without a license, respondents could lawfully detain Munoz for further investigation.
Assuming all of the aforementioned respondents' actions were within the scope of their duties as peace officers, the question remains whether the receipt of the moneys and the holding of the moneys were done within their official capacity.
A violation of section 424 does not, under certain facts, require the misappropriated moneys be obtained by the officer while he is acting in his “official capacity.” (People v. Wall (1980) 114 Cal.App.3d 15, 21, 170 Cal.Rptr. 522.) “[S]ection 426 defines ‘public moneys' as used in sections 424 and 425 as moneys ‘belonging to the state’ or any subdivision thereof ‘and all moneys ․ received or held by ․ [public] officers in their official capacity.’ (Italics added.)” (Ibid.)
In Wall, a police officer observed the defendant at a parking meter on a certain street with a funnel, canister and cart, making a motion as though to open the meter. Within a few moments, defendant removed the cart and the canister to the next meter in line. The defendant was employed by the City and County of San Francisco as a parking meter collector. He was assigned to empty parking meters in a different area several times a week and at the end of each working day, 5 p.m., return the coins retrieved to a designated room in city hall. In order to collect the coins, keys were necessary to unlock the meter; a funnel was used to catch the drop of the coins from the opened meter and channel them into a canister. The canister was on a hand cart which would be wheeled from meter to meter as the collection progressed. Finally, a van was used to transport the collector and his gear to and from his assigned route. (Id. at pp. 17–18, 170 Cal.Rptr. 522.)
In Wall, the case involved moneys “belonging to the state,” or a subdivision thereof, even though the moneys were not received in the defendant's official capacity. The Court of Appeal held there was a sufficient nexus between the parking meter moneys belonging to the City and County of San Francisco the defendant misappropriated and the use of the instrumentalities of defendant's occupation to gain possession thereof. However, in the instant case, the moneys misappropriated were not moneys “belonging to the state” and, therefore, it is necessary under these facts that the money taken from Velarde and Munoz came into the respondents' possession while acting in their official capacity.
We have found no cases directly on point in our independent research on this issue. However, workers' compensation cases discussing actions deemed within or without the “course and scope of employment” are instructive.
An employee is acting in the course and scope of his employment when he is engaged in work he was employed to perform (Burgdorf v. Funder (1966) 246 Cal.App.2d 443, 448, 54 Cal.Rptr. 805), or when the act is incident to his duty and was performed for the benefit of his employer and not to serve his own purposes or convenience. (Ibid.) As stated in Payne v. Industrial Acc. Com. (1927) 84 Cal.App. 657, 660, 258 P. 620: “․ [A]cts incidental to his regular duties, if of benefit to the employer and not personal to the employee, are within the scope of his employment․” (Emphasis added; see also Mazzola v. Feinstein (1984) 154 Cal.App.3d 305, 311–312, 201 Cal.Rptr. 148.)
A distinction must be made between an unauthorized departure from the course of employment and the performance of a duty in an unauthorized manner. Injury occurring during the course of the former conduct is not within the course and scope of employment. The latter conduct, while it may constitute serious and willful misconduct by the employee, does not take the employee outside the course of his employment. (Pacific Tel. & Tel. Co. v. Workers' Comp. Appeals Bd. (1980) 112 Cal.App.3d 241, 245, 169 Cal.Rptr. 285.)
Even illegal or criminal conduct by an employee in the course of employment does not necessarily remove him from the course of employment. (Wiseman v. Industrial Acc. Com. (1956) 46 Cal.2d 570, 572–573, 297 P.2d 649; Pacific Tel. & Tel. Co. v. Workers' Comp. Appeals Bd., supra, 112 Cal.App.3d 241, 246, 169 Cal.Rptr. 285; Williams v. Workmen's Comp. Appeals Bd. (1974) 41 Cal.App.3d 937, 941, 116 Cal.Rptr. 607.)
In Williams, the employee was a deliveryman who, while on company business, ran a red light; he was pursued by a police officer and a high speed chase ensued. A motor vehicle accident occurred when the employee, during the chase, rear-ended another vehicle. The referee (now designated workers' compensation judge) found the injury compensable but held that as the employee was guilty of serious and willful misconduct his benefits were reduced by one-half. The Workers' Compensation Appeals Board (Board) reversed the referee, holding the injury noncompensable, reasoning that the employee abandoned his employment during the high speed chase. Annulling the Board's decision, the court first noted the distinction between an unauthorized departure from the course of employment and the performance of duties in an unauthorized manner. The court rejected the Board's position that the injury was noncompensable since the employee was concerned only with eluding his pursuer at the time of injury; the court observed:
“[a]n employee's personal purpose at the time of injury is irrelevant so long as he is engaged generally in performing a task for his employer. (Wiseman v. Industrial Acc. Com., supra, 46 Cal.2d 570, 573 [297 P.2d 649].) And it has been held that where the employee is combining his own business with that of his employer no nice inquiry will be made as to which business he is actually engaged in at the time of the injury, ‘ “unless it clearly appears that neither directly [n]or indirectly could he have been serving his employer.” ’ (Wiseman v. Industrial Acc. Com., supra, at p. 573 [297 P.2d 649]․)” (Williams v. Workmen's Comp. Appeals Bd., supra, 41 Cal.App.3d at p. 942, 116 Cal.Rptr. 607.)
In Wiseman, the decedent, a vice-president of a San Francisco bank, died of asphyxiation and burns in a hotel room in New York City. He was in that city on bank business and his traveling expenses, including his hotel bills, were paid by the bank. A woman, not his wife but registered as such, was found unconscious in his room and died shortly thereafter. There was evidence they had been drinking. Between 4 and 5 a.m., the morning of his death, Wiseman telephoned the hotel manager for help because of a fire in his room. After calling the fire department, the manager went to the room but was unable to open the door with his passkey. Firemen arrived shortly thereafter and broke into the room but were too late to save the occupants. It was the opinion of the assistant fire marshal that the fire was caused by careless smoking by either one or both of the occupants. Petitioners, the widow and minor daughter of the employee, filed claims as his dependents with the Industrial Accident Commission for death benefits. The referee made an award in favor of petitioners, but the commission granted the employer's petition for reconsideration, vacated the referee's award and findings, and denied petitioners' claims. In reviewing the award, the California Supreme Court found that the fact the employee traveling on business for his employer had a guest in his hotel room while he was off duty does not detract from the fact that he was also there on his employer's business. Since the employee's fault at the time he died of asphyxiation and burns is irrelevant if the requirements of the workers' compensation law are met, it is immaterial the employee's personal purpose in having a guest in his room may have been immoral and unlawful. (Wiseman v. Industrial Acc. Com., supra, 46 Cal.2d 570, 572–573, 297 P.2d 649.) The court held that in the absence of some direct connection between the immoral and unlawful purpose and the risk of fire, the existence of such purpose cannot justify the conclusion that the connection between the injury and the employment “ ‘is so remote from the employment that it is not an incident of it.’ ” (Id. at p. 574, 297 P.2d 649.)
In Pacific Tel. & Tel. Co. v. Workers' Comp. Appeals Bd., supra, 112 Cal.App.3d 241, 169 Cal.Rptr. 285, an advertising salesman sought compensation for injury to his emotional state resulting from the stress of an accusation by his employer that he had forged customers' signatures on advertising contracts and from the stress of the subsequent investigation of the accusation and termination of his employment. The workers' compensation judge ruled in favor of the employee holding that no factual finding as to the employee's guilt or innocence of the accusation was necessary to the resolution of the controversy, since the injuries arose from the course of the employment in either case. The Board affirmed the decision. The Second District Court of Appeal annulled the decision of the Board holding that the question of the employee's guilt or innocence of the forgeries was crucial to the issue of whether his injuries were proximately related to his employment and hence compensable, or incidental to criminal conduct clearly outside the scope of his employment and hence noncompensable. The court could not conceive of a realistic argument that applicant would be directly or indirectly serving his employer by the forging of contract signatures. Accordingly, the court concluded injuries sustained during the actual furtherance of the criminal activity of forgery would not be compensable. In that case, however, the claimed industrial injury was not sustained directly during the course of the alleged criminal activity but sustained as a consequence of the accusation, investigation and termination of the employee by Pacific Telephone and Telegraph Company. The court remanded the matter to the Board to make a finding on the factual question of the employee's guilt or innocence. (Id. at pp. 246–247, 169 Cal.Rptr. 285.)
The theme or basic principle of these cases seems to be that entitlement to benefits may not be denied so long as the employee is engaged generally, either directly or indirectly, in performing a task for his employer. On the other hand, as stated in Wiseman, if it clearly appears from the facts that neither directly nor indirectly could the employee have been serving his employer, then compensation benefits must be denied.
In its supplemental authorities, appellant cites People v. Long (1987) 189 Cal.App.3d 77, 234 Cal.Rptr. 271 for the proposition that a peace officer may seize and search a person's wallet on reasonable suspicion that evidence relating to criminal activity may be discovered. Thus, as the argument goes, respondent Johnson had the right to “seize” the wallets of Velarde and Munoz, respectively, and, having done so while acting in his “official capacity,” the money contained in each of the wallets thereby became “public moneys” as defined in section 426. We first note Long does not involve any question regarding application of sections 424 and 426 to its facts, i.e., theft of public moneys. More importantly, it seems to us appellant's argument would exalt form over substance to reach a result that would be contrary to expressed legislative intent to provide, by section 424 et seq., a broad salutary means of punishing public officers who betray their public trust by taking for their own use public money being handled by them in their official capacity. This is not such a case upon its facts.
In the instant case, we can conceive of no rational basis upon which to conclude that Johnson and Phillips were performing a task for their employer, the State of California, when they allegedly took the money from Velarde and Munoz respectively for their personal use, i.e., stole the money. (See Pacific Tel. & Tel. Co. v. Workers' Comp. Appeals Bd., supra, 112 Cal.App.3d 241, 246–247, 169 Cal.Rptr. 285.) Thus, in our view, the money did not come into respondents' possession while acting in their official capacity. The trial court properly set aside counts III and VII alleging violation of section 424.
C. SUFFICIENCY OF EVIDENCE OF EMBEZZLEMENT (§ 504)
Again, the People argue the respondents obtained the victim's property in their official capacity as peace officers. Furthermore, the People contend it necessarily follows the property came into their possession by virtue of the trust reposed in them as state traffic officers. Thus, according to this argument, the respondents' fraudulent appropriation and secreting of the money was embezzlement.
Section 504 provides:
“Every officer of this State ․ who fraudulently appropriates to any use or purpose not in the due and lawful execution of his trust, any property which he has in his possession or under his control by virtue of his trust, or secretes it with a fraudulent intent to appropriate it to such use or purpose, is guilty of embezzlement.”
In People v. Wall, supra, 114 Cal.App.3d 15, 170 Cal.Rptr. 522, the First District Court of Appeal held the defendant could not be found guilty of a violation of section 504 because, at the time of the taking of the money from the parking meters, the money was not “in his possession or under his control by virtue of his trust.” When the defendant took the money, he was not acting in the performance of his duties, for two reasons. First, the taking was one hour after the work shift ended and the defendant was not authorized to collect at that time. Second, in the month of the occurrence, the defendant was not assigned to collect on that certain street at anytime. He was assigned to a different area that did not include that certain street. (Id. at p. 18, 170 Cal.Rptr. 522.) The respondent argued that since defendant had in the course of his duties secured and secreted the various items needed to empty the meters, that would constitute the meter money as being “under his control by reason of his trust.” However, there was no evidence to indicate how appellant secured the equipment. Since the burden was upon the prosecution to prove that the defendant had the meter money “under his control by virtue of his trust,” there was a failure to prove that defendant came into possession of the equipment used to empty the meters “by virtue of his trust.” (Id. at pp. 19–20, 170 Cal.Rptr. 522.)
The People, in the instant case, rely on People v. Knott (1940) 15 Cal.2d 628, 104 P.2d 33 in which a county auditor was prosecuted and convicted of violations of section 504. It was the auditor's function to draw warrants upon the county treasury in payment of the obligations of the county. The court held that although it was the county treasurer who was legally in possession of the county money, it was the duty of the county treasurer to pay warrants drawn by the auditor regular on their face. The auditor issued a number of warrants on false claims and took the funds secured thereby from the county treasurer for her own use. The court held that within the meaning of section 504, the auditor had “control” of the county money. But, in Knott there was no issue as to how the auditor secured the blank warrants she was executing, i.e., whether she had control “by virtue of her trust.” On the contrary, it was the auditor's function to draw warrants and she was drawing the fraudulent warrants in the course of her duties. Therefore, she had control “by virtue of her trust.” (Id. at pp. 631–632, 104 P.2d 33.)
The People further rely on such cases as People v. Coe (1959) 171 Cal.App.2d 786, 342 P.2d 43 in which the defendant, a cashier at the payment window of a county probation department, was properly charged, under section 487, subdivision (1), with theft of a sum of money from a probation officer, rather than with embezzlement of public funds under section 504, where the funds she took had been paid to the probation officer, who was designated the court trustee, by private persons pursuant to court order in divorce and other proceedings for the support of their minor children for transmittal to the private persons for whose benefit the funds were ordered, since such moneys were not of a “public fund” nature, to be used or held for a public purpose. Coe held that a prosecution under section 504 could not be limited exclusively to embezzlement of “public” funds since there was no direct reference to the term “public” in connection with the property subject to appropriation, and the inclusion therein of the appropriation by private persons of any property belonging to any association, society or corporation of either a public or private nature. (Id. at p. 791, 342 P.2d 43.) The Coe court held the evidence was insufficient to prove a taking of public funds under section 504 and assumed only for the purposes of defendant's contention that the moneys were of a public nature. (Id. at p. 794, 342 P.2d 430.) The issue was whether a variance arose as to the proof of section 504 as opposed to section 487 which was charged. It is difficult to see the bearing Coe has on the case before us.
People v. Floyd (1926) 78 Cal.App. 11, 247 P. 917, a case also relied upon by the People, involved the prosecution of a city recorder for embezzling funds collected for violations of the California Vehicle Act, where instead of paying into the city treasury moneys collected, the defendant fraudulently appropriated the moneys with felonious intent in violation of section 504. In Floyd, however, the defendant had the responsibility of collecting fines for violations of the then California Vehicle Act and received the money by virtue of her trust in that she had the authority to handle the public money as part of her official job duties.
The People continue to argue as was argued previously, respondents obtained the victim's property in their official capacity as peace officers and thus the property came into their possession by virtue of the trust reposed in them as state traffic officers. According to this argument, their fraudulent appropriation and secreting of the money was thus embezzlement. As explained earlier, this argument fails as the officers were not acting in their official capacity and, furthermore, there is no evidence the money was placed in their possession by virtue of the trust reposed in them.
The People also argue, in the alternative, that respondents maintained a status as involuntary trustees in accordance with Labor Code section 2860 which provides:
“Everything which an employee acquires by virtue of his employment, except compensation which is due to him from his employer, belongs to the employer, whether acquired lawfully or unlawfully, or during or after the expiration of the term of his employment.”
In People v. Vallerga (1977) 67 Cal.App.3d 847, 136 Cal.Rptr. 429, a county assessor was convicted of, inter alia, the willful refusal or omission to pay over to any officer or person authorized by law to receive “any money” received by an officer “under any duty imposed by law so to pay over the same” in violation of section 424, subdivision 7 and
“unlawfully and fraudulently appropriat[ing] to a use and purpose not in the due and lawful execution of his trust, property which he had in his possession and under his control by virtue of his trust and did willfully and unlawfully secrete said property with a fraudulent intent to appropriate it to such a use and purpose, contrary to Penal Code section 504, said property being of a value exceeding two hundred dollars ($200.00)”;
it was also found that “the theft was of public funds.” (Id. at p. 855, 136 Cal.Rptr. 429.) The court held that under the law, when defendant received the sum of $3,000 from a private individual under the assumption the money was paid in return for defendants' efforts to sell and implement a contract with the employer county which included use of county facilities, equipment and personnel, within the scope of his duties as a county assessor, defendant was under a duty to pay that amount over to the county and his willful omission to do so constituted a violation of section 424, subdivision 7. The Second District Court of Appeal cited Labor Code section 2860 and found “defendant acting in his capacity as Assessor of Orange County, without question acted as an agent of the county as well as a trustee with respect to the facilities and powers entrusted to him as a public officer.” (Id. at p. 876, 136 Cal.Rptr. 429.) Accordingly, the court held that the basic legal principles recited in Labor Code section 2860 applicable to the defendant. (Ibid.) The Labor Code section is merely an expression of the familiar principle that forbids an agent or trustee to use the trust property or powers conferred on him for his own benefit. (Ibid.)
“ ‘In 2 California Jurisprudence 2d 775, section 106 it is stated: [¶] “․ This means that the agent is not permitted to obtain any advantage over his principal by the slightest misrepresentation, concealment, threat, or adverse pressure of any kind. He may not use or deal with subject matter of the agency for his own profit, or for any purpose unconnected with the agency in any manner.” ’ ” (Ibid., emphasis added.)
In the instant case, it does not appear respondents were obtaining any advantage over their employer, i.e., the state; therefore, the applicability of Labor Code section 2860 appears less than certain.
The People also rely on People v. Hess (1951) 104 Cal.App.2d 642, 234 P.2d 65. In Hess, the evidence sustained convictions of right-of-way agents and a real estate broker of conspiracy to embezzle public funds in violation of section 504. The agents, instead of directly approaching owners of property needed for a freeway, worked with the broker under an agreement assuring them part of the commission he charged the vendors. The amount of the commission was apparently included in the appraisal which was made by the agents, and title to such amount never passed to the vendors but remained the state's property and hence subject to embezzlement. (Id. at pp. 672–674, 234 P.2d 65.) Here again the defendant is obtaining an advantage over the employer, and thus distinguishable.
People v. Newman (1975) 49 Cal.App.3d 426, 122 Cal.Rptr. 455 involved stock certificates which a bank was entitled to hold as security for the defendant's loan which came into defendant's possession by accident and he converted them to his own use. The Second District Court of Appeal affirmed his conviction of grand theft in violation of section 504b on the theory the defendant was an involuntary trustee. The court rejected defendant's argument that embezzlement requires a voluntary entrustment. (Id. at p. 431, 122 Cal.Rptr. 455.) The court held that in light of the rule that a person who, through mistake, receives money to which he is not entitled holds it as trustee for the person who is entitled to it; thus, defendant, who received stock certificates which he knew secured his loan at a bank, but which he nevertheless converted to his own use, thereby committed theft by embezzlement. (Ibid.)
According to the People's argument in this regard, respondents' receipt of the money by virtue of their employment rendered them involuntary trustees of the money on behalf of the state. By appropriating the money for their own use and secreting it on their persons in the Munoz incident, they committed embezzlement of public funds under section 504.
In the instant case, both the owners of the money in question and the general public have the right to expect their wallets and the matters contained therein would be dealt with lawfully and not stolen by peace officers, during the course of an otherwise lawful detention. Ignoring Detective Munoz's undercover status which is not relevant here, Velarde and Munoz delivered up their wallets and money to Johnson only because of respondents' official capacity as California Highway Patrol officers. Again, we can perceive of no other reason for the conduct of the two drivers: Respondents were Highway Patrol officers operating a plainly marked official vehicle, they demanded and/or took the wallets and money in the course of an otherwise legal detention and, at the point of taking, were acting ostensibly in the proper performance of their duty. Thus, it seems to us, the money initially came into respondents' possession “by virtue of” their “trust.” That respondents may have had the secret intent to thereafter convert the money unlawfully to their private use is not determinative. We therefore conclude, upon these facts, the People below could properly allege violation of section 504 in the information charging respondents and the trial court erred in setting aside counts IV and VIII.
The order is affirmed as to setting aside counts III and VII (§ 424) and reversed as to setting aside counts IV and VIII; it is ordered that counts IV and VIII be reinstated.
1. All statutory references are to the Penal Code unless otherwise indicated.
2. Section 830.2 provides in pertinent part:“The following persons are peace officers whose authority extends to any place in the state:“(a) Any member of the California Highway Patrol, provided that the primary duty of the peace officer shall be the enforcement of the provisions of the Vehicle Code or of any other law relating to the use or operation of vehicles upon the highways, as that duty is set forth in the Vehicle Code.”
MARTIN, Acting Presiding Justice.
BEST and BALLANTYNE, JJ., concur.