McMichael v. Commonwealth
| Decision Date | 19 March 2021 |
| Docket Number | NO. 2020-CA-0515-MR,2020-CA-0515-MR |
| Parties | ANDREW MCMICHAEL APPELLANT v. COMMONWEALTH OF KENTUCKY APPELLEE |
| Court | Kentucky Court of Appeals |
TO BE PUBLISHED
APPEAL FROM JEFFERSON CIRCUIT COURT
On October 22, 2019, McMichael pled guilty to theft by unlawful taking over $500 but less than $10,0001 for removing and scrapping some stainlesssteel siding from a 1952 Mountain View modular diner owned by Moseley Putney.2 The scrapping of the stainless steel netted approximately $150, which was split amongst McMichael, his codefendant, and perhaps another party not prosecuted in this action.3 As part of the plea agreement, McMichael agreed to pay restitution in an amount to be determined by the trial court.
On March 9, 2020, a restitution hearing was held. Putney, the sole witness for the Commonwealth, testified that he bought the diner in 1991 for approximately $25,000. At the time of purchase, the diner was in need of restoration, including repairs to its roof and one end, and it did not include a kitchen. After purchase, Putney simply moved the diner—twice—with its final destination being a storage site where it was exposed to the elements for over 15 years. Putney visited the storage site every few years to weed-eat, cut back trees, take pictures, and generally inventory the diner. Prior to discovering the theft of its siding, it had been 18 to 24 months since Putney had visited the diner. Putney produced no photos from his last visit prior to the vandalism but, rather, one photo of the diner's good side which he believed to be taken five to ten years before removal of the siding. He also produced two photos of the diner taken after thesiding removal, which showed much of the siding still intact (though not in pristine condition), and two photos of the siding found at the salvage yard.
The foregoing notwithstanding, Putney believed he could have sold the diner before the siding was removed for $30,000 to $60,000. He also believed the diner could generate three million dollars or more once fully restored and operational. Nonetheless, Putney never insured the diner or procured an insurer's estimation as to its value. Putney acknowledged the stainless steel siding removed by McMichael had a low salvage value but claimed it had a much higher fair market and/or replacement value due to its "custom" bending and the forming of the metal which made it "unique." Putney further acknowledged much, if not all, of the siding was recovered; however, he testified it was damaged and unusable. Putney testified he had consulted Merrick Kemper, a local sheet metal and roofing contractor, and obtained two repair estimates, which were entered as exhibits.4 The first estimate for a partial repair was $62,493, while the second estimate for a more complete repair was $221,800.
On cross-examination, Putney denied telling police the diner was worth only $3,000, the amount cited in the criminal complaint. Putney explained that amount only estimated the salvage value of the steel taken, not the value of thediner itself. He also testified that he had no idea what the salvage value of the stainless steel was but thought it would have been higher. Putney conceded he had no records regarding the purchase of the diner, nor did he have documentation to support his estimates that the sale value of the diner before the siding was removed was between $30,000 and $60,000 or that the diner could generate millions of dollars once fully restored and operational.
McMichael requested restitution be set at either the amount for which the stainless steel was scrapped (approximately $150) or the amount set forth in the initial complaint ($3,000). McMichael argued the Commonwealth had not met its burden of proof to establish higher restitution where Putney's testimony conflicted with the initial complaint, which was never amended and was not supported by documentation. McMichael further argued the diner was not worth the amount Putney asserted because it had been sitting in the woods since the 1990s and was in need of extensive restoration before the siding was removed. The Commonwealth disagreed, asserting Putney was competent to testify and his testimony was supported by repair estimates from a company specializing in metal work. The Commonwealth asked the court to set restitution at $62,493, the amount necessary to repair the damage caused by the theft. The trial court agreed and ordered McMichael to pay $62,493 in restitution. This appeal followed. Additional facts will be introduced as they become relevant.
On appeal, a trial court's finding as to the amount of restitution will not be set aside unless it is clearly erroneous, i.e., unsupported by substantial evidence. Jones v. Commonwealth, 382 S.W.3d 22, 32 (Ky. 2011); Mitchell v. Commonwealth, 538 S.W.3d 326, 329 (Ky. App. 2017). "Substantial evidence is evidence which, when taken alone or in light of all the evidence, has sufficient probative value to induce conviction in the mind of a reasonable person." Mitchell, 538 S.W.3d at 329.
McMichael has appealed the sum of restitution as determined by the trial court. He makes three arguments why the trial court erred by setting a restitution amount in excess of $62,000: (1) the Commonwealth failed to present any evidence having even a minimum indicium of reliability that the diner or its metal siding was worth more than the $3,000 noted in the criminal complaint; (2) the court's finding that the diner and its siding had a higher value was ambiguous; and (3) the diner and its siding had little to no value on the fair market.
We begin by noting restitution to the victim herein is required by statute since McMichael pled guilty to a Class D felony offense. KRS 532.356(1)(b).5 Pursuant to KRS 532.350(1)(a), restitution is rather vaguelydefined as "any form of compensation paid by a convicted person to a victim for . . . property damage . . . because of a criminal act[.]" Unless the amount of restitution is agreed upon by the parties, constitutional due process requires a trial court to conduct an adversarial hearing for the purpose of determining a restitution amount. Jones, 382 S.W.3d 22. At this hearing, the Commonwealth bears the burden of establishing the validity of the restitution claim and the amount of restitution by a preponderance of the evidence. Id. at 32. Formerly, under KRS 431.200, juries were required to determine the restitution amount.6 However, after the enactment of KRS 532.032, restitution determinations are made by the trial court and not by jury when this statute is applicable. See Brown v. Commonwealth, 540 S.W.3d 374 (Ky. 2018); Fields v. Commonwealth, 123 S.W.3d 914, 916 (Ky. App. 2003), as modified (Nov. 26, 2003).7 Moreover, trial courts are vested with"broad discretion . . . to resolve [restitution] matter[s] in a way that respects the constitutional rights of all the parties and that achieves substantial justice." Jones, 382 S.W.3d at 31.
Unfortunately, Kentucky's restitution statutes give little guidance on how the amount of restitution is to be determined. Moreover, few published opinions have set out any methodology to follow in determining equitable restitution orders. Nevertheless, in most theft cases, determining the value of the thing stolen is a rather easy endeavor. For example, in Mitchell, the victim's testimony as to the value of items stolen, based on the prices for the same items listed on Amazon.com, was deemed sufficient to support the trial court's determination as to the amount of restitution. Mitchell, 538 S.W.3d at 328, 330. However, herein, apparently 1950s era modular diner stainless steel siding is one of the few things Amazon.com fails to offer for sale. Furthermore, Putney offered no testimony of any research—online or otherwise—conducted to verify his estimates of the diner or the value of its siding.
The uncontroverted evidence offered by the Commonwealth at the hearing established Putney purchased the diner in 1991 for approximately $25,000 in a significant state of disrepair. After the purchase, Putney had done nothing more than move the diner a couple of times, leaving it at an outdoor storage lot for over 15 years unprotected from the weather. Certainly, nothing had been done to increase its value. McMichael testified he shared the $150 from the sale of the stainless steel. The only shred of evidence presented by the Commonwealth as to the value of the metal came through an estimate to replace the sheet metal on the unusable diner for over $62,000—more than double what Putney paid in 1991 for the entire diner! Surely the adage "crime doesn't pay" is a vast understatement when applied to McMichael.
Even so, appellate courts in Kentucky have established few procedural guides for restitution determinations. Significantly, the courts have recognized a criminal defendant's right to due process in the establishment of a restitution amount. Fields, 123 S.W.3d 914; Wiley v. Commonwealth, 348 S.W.3d 570, 575 (Ky. 2010); Jones, 382 S.W.3d 22. Additionally, restitution awards must be based on reliable facts. Id. As noted in Wiley, and applied to restitution proceedings, "although a lower standard of due process applies at sentencing, the facts relied on by the court must 'have some minimal indicium of reliability beyond mere allegation.'" Wiley, 348 S.W.3d at 575 (quoting Fields, 123 S.W.3d at 917).
Kentucky courts have addressed the establishment of value of stolen property in the context of determining the proper crime charged. In Allen v. Commonwealth, 148 Ky. 327, 146 S.W. 762 (1912), the Court observed:
In cases like this, where the degree of the offense depends...
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