In re Rader Bonding Co.

• Decision Date: 23 December 2019
• Docket Number: No. M2017-01687-SC-R11-CD,M2017-01687-SC-R11-CD
• Citation: 592 S.W.3d 852
• Parties: IN RE: RADER BONDING COMPANY, INC.
• Court: Tennessee Supreme Court

592 S.W.3d 852

IN RE: RADER BONDING COMPANY, INC.

No. M2017-01687-SC-R11-CD

Supreme Court of Tennessee, AT NASHVILLE.

September 4, 2019 Session Heard at Knoxville

FILED December 23, 2019

Herbert H. Slatery III, Attorney General and Reporter; Andrée S. Blumstein, Solicitor General; and Leslie E. Price, Senior Assistant Attorney General for the appellant, State of Tennessee.

Joel H. Moseley, Jr., Old Hickory, Tennessee, for the appellee, Rader Bonding Company, Inc.

Cornelia A. Clark, J., delivered the opinion of the court, in which Jeffrey S. Bivins, C.J., and Sharon G. Lee, Holly Kirby, and Roger A. Page, JJ., joined.

Cornelia A. Clark, J.

We granted this appeal to determine whether a surety remains obligated under a bond agreement entered on the defendant’s arrest for driving under the influence second offense when a subsequent indictment charged the defendant with driving under the influence fourth offense. We conclude that sureties remain obligated pursuant to Tennessee Code Annotated sections 40-11-130(a)(1), -138(b) and this Court’s holding in Young v. State, 173 Tenn. 469, 121 S.W.2d 533 (1938). We hold, therefore, that the trial court did not abuse its discretion when it entered the final judgment of forfeiture against Rader Bonding Company, Inc. ("Rader") for the total amount of the bond and declined to grant Rader’s motion to alter or amend. Accordingly, we reverse that portion of the Court of Criminal Appeals’ decision holding that Rader should have been relieved from forfeiture on the $7,500 bond in connection with the defendant’s DUI charge and affirm its conclusion that Rader remains obligated on the $2,500 bond in connection with the defendant’s driving on a revoked license charge.

I. Factual and Procedural Background

On October 4, 2015, the defendant, Saul Aldaba¹ ("the defendant"), was arrested and charged with driving under the influence ("DUI") second offense, a Class A misdemeanor, and driving on a revoked license, a Class B misdemeanor. See Tenn. Code Ann. §§ 55-10-401–402(a)(2), 55-50-504(a)(1) (2012 & Supp. 2015). According to the arrest warrant affidavits, the defendant ran a red light and collided with another vehicle, causing injuries to both the driver of the other vehicle and the passenger in his own. The defendant showed multiple signs of impairment and performed poorly on field sobriety tasks. The arresting officer determined that the defendant’s license had been revoked due to two prior DUI first offenses. But, for reasons not explained in the record, the warrant of arrest charged the defendant only with DUI second offense "due to a prior DUI 1st offense charge in Maury County ... [,]" as well as driving on a revoked license. The magistrate in the general sessions court assigned each of the two charges a separate case number—GS742122 for the DUI second offense charge and GS742123 for the driving on a revoked license charge—and set bond at $7,500 for the DUI second offense charge and at $2,500 for the driving on a revoked license charge. That same day, Rader posted bond totaling $10,000 for both charges as surety for the defendant, evidenced by a "Criminal Appearance Recognizance" ("bond agreement") signed by Rader, the defendant, and the court clerk. Specifically, the bond agreement states:

This case having been continued, thereupon the defendant ... with Surety, Rader, his security, acknowledge themselves to owe and be indebted to the State of Tennessee in the Penal sum of $10,000 jointly and severally, to be levied of their goods and chattels, lands and tenements; to be void, however, on condition that the defendant doth make his personal appearance before the Court of Davidson County, having jurisdiction of his cause, from day to day, then and there to answer to the State of Tennessee on a charge of:

 CASE/WARRANT # CHARGE BOND COURT DATE/TIME
                  1. GS742123        55-50-504 License-Driving on     $2,500.00     11/05/2015 8:30am
                                     Revoked B MISD
                  2. GS74122         55-10-401 Driving Under the      $7,500.00     11/05/2015 8:30am
                                     Influence — 2nd AMISD
                                                           Total: $10,000
                

The record does not reflect what, if anything, occurred on November 5, 2015. However, on January 26, 2016, the general sessions court bound the case over to the grand jury after the defendant waived a preliminary hearing. In July 2016, the Davidson County Grand Jury indicted the defendant on five counts, including DUI fourth or subsequent offense² , a Class E felony, and driving on a revoked license, a Class B misdemeanor.³ See id. §§ 55-10-401–402(a)(4), 55-50-504(a)(1) (2012 & Supp. 2015). According to court minutes, the defendant appeared on August 5, 2016, the date the case was set for arraignment, "being represented by counsel[,]" but the case was continued until September 16, 2016. When the defendant failed to appear on that date, the trial court entered a conditional judgment of forfeiture of the $10,000 bond against the defendant and Rader and issued a writ of scire facias⁴ requiring the defendant and Rader to appear within 180 days to show cause why the judgment should not become final. See Tenn. Code Ann. § 40-11-202 (2018).⁵

Rader filed an answer to the scire facias and a motion to set aside the conditional judgment and to be relieved as the surety on March 10, 2017. As relevant to this appeal, Rader argued that the State abandoned the DUI second and driving on revoked charges because, "while case numbers GS742122 and GS742123 were bound over to the [g]rand [j]ury, there [was] ... nothing to indicate that these charges were actually presented by the District Attorney for its investigation." Therefore, Rader contended that "the return of the indictment was not a continuation of the cases which began in [g]eneral [s]essions, but[, instead,] ‘... was the beginning of a new proceeding.’ " The State responded to these assertions by providing a file cover and indictment form worksheets that it alleged "clearly indicate[d] that GS742122 was the basis for Count[ ] 2[, the DUI fourth offense or more charge,] ... and GS742123 was the basis for Count 4[, the driving on a revoked license charge]." Specifically, on the indictment worksheet for Count 2, "DUI 4th or more" was written in the space next to "[c]harge[,]" along with "GS742122[,]" which was written next to "WNO(S)" (i.e., warrant number(s)). Similarly, on the indictment worksheet for the driving on a revoked license charge, "GS742123" was written next to "WNO(S)[.]" According to the State, these forms reflected the "straight-forward procedure" of how warrants become counts for which a defendant is later indicted.

The trial court held a hearing and subsequently entered a written order on April 4, 2017, denying Rader’s motion to set aside the conditional judgment and to relieve Rader as the surety, explaining, in part, that "[t]echnically, every indictment is a new criminal proceeding. Therefore, under [Rader’s] ... logic a new bond would have to be posted with every indictment since the underlying warrants that lead to the issuance of the indictment no longer have any force or effect." The court further noted there was "no evidence to suggest that the grand jury considered any facts outside of those that led to the issuance of the warrants initially[.]" The trial court entered a final judgment on March 30, 2017, in the amount of $10,000 plus costs against the defendant and Rader.

On May 1, 2017, Rader filed a motion to alter or amend the final judgment. In a supplemental memorandum of law in support of its motion, Rader again argued that, under the terms of the bond agreement, it was "only bound to produce the defendant on the charges arising out of the arrest in the General Sessions Court of Davidson County under warrant numbers GS742122 and GS742123" and that the indictment constituted a new criminal proceeding, "not a continuation of the prosecution that began in [g]eneral [s]essions." The trial court heard the motion on June 20, 2017, and, after noting that there was "nothing new or different about this case, [but, rather, that] it happens quite frequently," the trial court issued an order denying the motion on July 25, 2017.

Rader timely appealed, and in the Court of Criminal Appeals it argued that the trial court erred in entering the final judgment of forfeiture against it for $10,000 because:

(1) the State abandoned its prosecution in general sessions court of the Defendant’s charges which were subject to the bond agreement and the indictment constituted new proceedings to which the bond agreement did not apply; (2) the terms of the bonding agreement did not extend to the charges in the indictment; and (3) the State materially increased Rader’s risk on the bond and breached its implied covenant of good faith and fair dealing.

State v. Aldaba-Arriaga (In re: Rader Bonding Company), No. M2017-01687-CCA-R3-CD, 2018 WL 6605931, at *3 (Tenn. Crim. App. Dec. 14, 2018). The State responded by arguing that, because the return of the indictment was not a disposition of the charges as described in Tennessee Code Annotated section 40-11-138, Rader was still obligated on the bond under section 40-11-130(a)(1). Id. at *5. A majority of the intermediate appellate court affirmed in part and reversed in part the trial court’s judgment. The majority held that Rader remained obligated on the $2,500 bond set for the driving on a revoked license charge because the charge had not been disposed of under the statute and the defendant was indicted for the same charge. Id. at *7. However, the majority granted Rader relief from forfeiture on the DUI charge, reasoning that, "while the DUI second offense charge ha[d] not been disposed of under section 40-11-138(b)," "a bail bond is nothing more than a type of contract." Id. (quoting State v. Clements, 925 S.W.2d 224, 226-27 (Tenn. 1996) ). Therefore, relying on contract principles, the court reasoned that "the plain terms of the bonding agreement...