Cabla v. State, 120899

• Decision Date: 08 December 1999
• Parties: (Tex.Crim.App. 1999) ROBERT CABLA, JR., Appellant v. THE STATE OF TEXAS NO. 1639-98
• Court: Texas Court of Criminal Appeals

Page 543

6 S.W.3d 543 (Tex.Crim.App. 1999)

ROBERT CABLA, JR., Appellant v. THE STATE OF TEXAS

NO. 1639-98

IN THE COURT OF CRIMINAL APPEALS OF TEXAS

December 8, 1999.

ON APPELLANT'S PETITION FOR DISCRETIONARY REVIEW FROM THE FOURTEENTH COURT OF APPEALS, HARRIS COUNTY

O P I N I O N

HOLLAND, J., delivered the opinion of the Court, in which MCCORMICK, P.J., MANSFIELD, KELLER, PRICE, and WOMACK, J.J., joined.

The trial court convicted appellant of theft, sentencing him to ten years confinement. See TEX. PENAL CODE ANN. 31.03 (e)(6). The trial court suspended imposition of this sentence and placed appellant on community supervision for a period of ten years. See TEX. CODE CRIM. PROC. ANN. Art. 42.12 6. As a condition of probation, appellant was ordered to pay a total of $66,412.88 in restitution to nine separate victims. See Article 42.12 11. In a single point of error, appellant argued on direct appeal that the trial court could not order restitution for debts which had been discharged in bankruptcy proceedings. Stating that appellant failed to show the trial court's order of restitution was an abuse of discretion, the court of appeals overruled appellant's point of error and affirmed the judgment of the trial court. See Cabla v. State, 974 S.W.2d 927, 928 (Tex.App.-Houston [14th Dist.] 1998).

This Court granted appellant's petition for discretionary review on the issue of "whether a State court may order restitution in a criminal case for an obligation based upon a debt which has been discharged by a federal court in a bankruptcy proceeding." We will affirm.

I.

Appellant worked as a general contractor in the home remodeling business in Houston. He received advance payments from the victims on remodeling and construction contracts. Appellant either completely failed to do the contracted work or performed below acceptable standards under the contracts. In December of 1994, appellant declared bankruptcy and alleged the money he owed on the contracts was discharged in that proceeding. In March of 1995, however, the State indicted appellant for theft of funds he received in payment on some of the contracts.

At trial, the State advanced the theory that appellant knew at the time he entered into the contracts that he could not perform promises made in those contracts. This pattern of behavior repeated with each of the nine complaining witnesses from August of 1992 through November of 1993. The State argued the pattern of behavior demonstrated both that appellant never intended to complete the contractual work and that he deceived victims into believing he would perform the promises in order to continue receiving their payments. The State asserted appellant knew he would never perform the promises. Instead, he used the promises to deceive victims out of their money.

Appellant argued this case involved civil issues best resolved in a civil court and claimed he was guilty only of having made bad business decisions. Appellant stated he planned to perform the promises made, and he did not have criminal intent to deceive any of the nine complaining witnesses out of their money. When he shut the doors to his business, appellant filed for bankruptcy under Chapter Seven of the Bankruptcy Code and listed every one of the complaining witnesses as a creditor. Appellant claimed the bankruptcy proceedings discharged each of these debts, and he accused the complaining witnesses of using criminal court to pursue collections on contractual debts.

The trial court ruled in favor of the State, finding appellant guilty of theft. The trial court took every instance of appellant's failure to perform a contract as evidence that appellant knew, at the time he received the money, he was not going to perform the contractual work. The trial court then decided to place appellant on community supervision and ordered him to pay restitution to the victims of the theft. Although the State sought $112,000 in restitution for the victims, the trial court determined appellant took $66,412.88 with no intention of performing the work for which they paid him. The trial court ordered appellant to pay $66,412.88 in restitution to the victims over the term of his community supervision. Appellant objected to the assessment of restitution, arguing the matter was within the exclusive jurisdiction of the bankruptcy courts, the claims had all been discharged in appellant's bankruptcy proceedings, and appellant's bankruptcy discharged any obligation to pay the victims. Appellant appealed this argument in a single point of error.

The court of appeals overruled appellant's point of error. The court relied upon the Supreme Court's opinion in Kelly v. Robinson, 479 U.S. 36, 50 (1986), wherein the Court decided that once restitution is imposed, a subsequent bankruptcy does not discharge the obligation. See Cabla, 974 S.W.2d at 928. Pointing to the Fifth Circuit's decision in United States v. Pepper, 51 F.3d 469, 473-74 (5th Cir.1995), the court of appeals concluded that a prior bankruptcy cannot prevent a court from ordering restitution of a victim whose claim had been discharged in bankruptcy. The court of appeals relied upon the Fifth Circuit's reasoning that a bankruptcy proceeding and a criminal prosecution are fundamentally different in both purpose and procedure and, therefore, the resolution of one proceeding will "seldom resolve" the other. See Cabla, 974 S.W.2d at 928. Because appellant had cited no authority to support his arguments, the court of appeals saw no reason to depart from the Federal courts's decisions on this matter. See id. Appellant requested this Court review the court of appeals's decision.

II.

There are inherent differences between the creditors and debtors of bankruptcy proceedings and the victims and defendants of criminal proceedings. These differences are reflected in the goals of the different proceedings. The Legislature adopted the Code of Criminal Procedure to govern our state's criminal proceedings with the goals of the "prevention, suppression and punishment of crime." See TEX. CODE CRIM. PROC. ANN. art. 1.26. Restitution was intended to "adequately compensate the victim of the offense" in the course of punishing the criminal offender. See TEX. CODE CRIM. PROC. ANN. art. 42.12 9(a). These compensations include "property damage or medical expenses" sustained by the victim as a direct result of the offense. TEX. CODE CRIM. PROC. ANN. art. 42.12 11(a)(14).

In this system, although restitution might appear to be a judgment benefitting the victim, "the context in which it is imposed undermines that conclusion. The victim has no control over the amount of restitution awarded or over the decision to award restitution." Kelly v. Robinson, 479 U.S. 36, 50 (1986). Control over payment of restitution remains solely with the trial court. The trial court's powers to fix the amount of restitution, the terms of payment, and to enforce the payment are non-delegable. See 42 GEORGE E. DIX & ROBERT O. DAWSON, TEXAS PRACTICE: CRIMINAL PRACTICE AND PROCEDURE 38.121 at 686 (1995 & Supp. 1999). In Kelly, the Supreme Court also explained that restitution is a component of the criminal justice system "not operated primarily for the benefit of the victim, but for the benefit of society as a whole." Kelly v. Robinson, at 50. Society is benefitted by punishment, including restitution, that is directly related to the offenses for which a defendant has been charged and convicted.

This principle is reflected in the rules and limits governing the imposition of restitution orders. As punishment, restitution attempts to redress the wrongs for which a defendant has been charged and convicted in court. Martin v. State, 874 S.W.2d 674, 678 (Tex. Crim. App.1994)("... notions of justice and fairness dictate that a defendant be punished only for the crime of which he was convicted."). Restitution orders are focused on the victims of the offenses for which a defendant has been convicted. The legislature did not intend for restitution to be "ordered payable to persons, other than the victim of the offense of conviction, who also suffered as a result of a scheme of which the offense of conviction was a part." See id. at 677-78. This Court has concluded that the focus of restitution orders are limited to the individuals alleged and proven to be the victims of the charged offense. Id.; See also Ex parte Lewis, 892 S.W.2d 4, 6 (Tex. Crim. App. 1994)(Limiting restitution orders to the proven victims of the charged offense is "equally applicable to restitution as a condition of probation.").

Additionally, the amount of a restitution order is limited to only the losses or expenses that the victim or victims proved they suffered as a result of the offense for which the defendant was convicted. See Gordon v. State, 707 S.W.2d 626, 629-30 (Tex. Crim. App. 1986). In Gordon, this Court decided we would not allow the defendant to be punished "for a crime of which [he] was acquitted." Id. at 629. We explained that a trial court may not impose a restitution order based upon conduct having no basis in the record. Id. at 628; see also Cartwright v. State, 605 S.W.2d 287, 289 (Tex. Crim. App. 1980)(Principles of due process require there be evidence in the record to show a factual basis for the amount of restitution ordered.).

In contrast, the goal of the bankruptcy system is not to punish, but to allow the honest debtor to re-start his financial life. In Kelly v. Robinson, the Supreme Court described the goal of bankruptcy proceedings. "A bankruptcy proceeding is civil in nature and is intended to relieve an honest and unfortunate debtor of his debts and to permit him to begin his financial life anew." Kelly, 479 U.S. at 46. The debtor selects the chapter of the Bankruptcy Code according to whether he needs to completely start over or whether he only needs to re-organize his debts. In the former situation, the debtor files for liquidation of his debts, or straight...