People v. Lai

• Citation: 42 Cal.Rptr.3d 444,138 Cal.App.4th 1227
• Decision Date: 26 April 2006
• Docket Number: No. B165662.,B165662.
• Court: California Court of Appeals
• Parties: The PEOPLE, Plaintiff and Respondent, v. Paul LAI et al., Defendants and Appellants.

42 Cal.Rptr.3d 444

138 Cal.App.4th 1227

The PEOPLE, Plaintiff and Respondent, v. Paul LAI et al., Defendants and Appellants.

No. B165662.

Court of Appeal, Second District, Division 4.

April 26, 2006.

Certified for Partial Publication.^*

Kim Malcheski, under appointment by the Court of Appeal, San Francisco, for Defendant and Appellant Sam Mui Luu.

Marilyn S. White-Redmond and Tracy Dressner, under appointment by the Court of Appeal, for Defendant and Appellant Paul Lai.

Bill Lockyer, Attorney General, Robert R. Anderson, Chief Assistant Attorney General, Pamela C. Hamanaka, Assistant Attorney General, Marc J. Nolan, Chung

L. Mar and Lawrence M. Daniels, Deputy Attorneys General, for Plaintiff and Respondent.

WILLHITE, J.

INTRODUCTION

For thefts of more than $100,000, but less than $500,000, may a defendant be punished by consecutive enhancements under both Penal Code sections 186.11, subdivision (a)(3), and 12022.6, subdivision (a)?¹ Further, if the defendant is sentenced to state prison, do sections 1202.4, subdivision (f), and 186.11, subdivision (d), authorize an order of restitution for losses caused by crimes other than those for which the defendant was convicted? Finally, if the court imposes a fine under section 186.11, subdivision (c), does subdivision (l) of that statute preclude imposing a restitution fine (§ 1202.4, subd. (b)), and a parole revocation restitution fine (§ 1202.45)?

Deciding these issues in the published portion of our opinion, we first hold that when a defendant is subject to the additional prison terms of both sections 186.11, subdivision (a)(3) and 12022.6, subdivision (a), the court must impose both terms, but stay execution of the term imposed under section 12022.6, subdivision (a). Next, we hold that for non-probationary sentences, neither section 1202.4, subdivision (f) nor section 186.11, subdivision (d) permit restitution for losses caused by crimes for which the defendant was not convicted. Finally, we hold that section 186.11, subdivision (l) does not preclude imposing restitution fines (§§ 1202.4 & 1202.45) in addition to the fine of section 186.11, subdivision (c).

In the unpublished portion of our opinion, we address various other sentencing issues raised by appellants. As to those issues, we find no error. We also address, and agree with, respondent's contention that the trial court erred in failing to impose mandatory state and county penalty assessments.

PROCEDURAL BACKGROUND

A jury convicted appellants Paul Lai and Sam Mui Luu of conspiracy to commit welfare fraud (§ 182, subd. (a)(1); count 1), welfare fraud (Welf. & Inst.Code, § 10980, subd. (c)(2); count 2), and 23 counts of perjury by false application for aid (§ 118; counts 3 through 25). The jury convicted Luu alone of an additional 12 counts of perjury (counts 26 through 37). As to the conspiracy and welfare fraud counts, the jury found true the allegation under section 12022.6, subdivision (a)(2) that the amount taken was more than $150,000. As to all counts, the jury found true the allegation under section 186.11, subdivision (a), the so-called "aggravated white collar crime enhancement," that the taking was of more than $100,000.

The trial court sentenced Lai to seven years in state prison, which included the upper term of three years for welfare fraud, plus two separate and consecutive two-year enhancements under sections 12022.6, subdivision (a)(2) and 186.11, subdivision (a)(3).² The court ordered Lai to pay victim restitution in the amount of $261,543.57, a fine of $96,982.16 (§ 186.11, subd. (c)), and as to each count a restitution fine of $200 (§ 1202.4, subd. (b)) and a parole revocation restitution fine of $200 (§ 1202.45).

The court sentenced Luu to four years in state prison, which included the middle term of two years for welfare fraud, plus a consecutive two-year enhancement under section 12022.6, subdivision (a). The court imposed and stayed a two-year term under section 186.11, subdivision (a)(3).³ The court did not order Luu to pay restitution. She was sentenced after Lai, following a section 1203.03 diagnostic evaluation. At Luu's sentencing hearing, the court found that the victims had been reimbursed from seized assets.

On appeal, Lai and Luu raise several challenges to their sentences. As we shall explain, we conclude that on Lai's sentence, the trial court should have stayed execution of the enhancement imposed under section 12022.6, subdivision (a)(2). We also conclude that the court should not have awarded restitution for losses attributable to uncharged crimes. In addition, we conclude that the trial court should have imposed mandatory penalty assessments as required by section 1464 and Government Code section 76000. Otherwise, we affirm Lai's judgment. Because the trial court is entitled to reconsider Lai's entire sentence, we remand Lai's case for resentencing. On remand, the trial court must stay execution of the two-year term under section 12022.6, subdivision (a)(2), delete that portion of the restitution award ($11,230) attributable to Lai's crimes predating the charged period, and impose the mandatory state and county penalty assessments. The court may fashion a new state prison sentence, so long as the new aggregate, non-stayed term does not exceed the original seven-year sentence. The court may also reconsider the amount of the underlying fine imposed pursuant to section 186.11, subdivision (c), upon which the amount of the penalty assessments are based, as well as the amount of restitution fines and restitution imposed pursuant to section 1202.4, subdivisions (b) and (f).

In Luu's case, we modify the judgment to impose a two-year term under section 186.11, subdivision (a)(3), consecutive to the middle term of two years on count 2 for welfare fraud. We further modify the judgment to impose a consecutive two-year term under section 12022.6, subdivision (a)(2), but stay its execution pending completion of the sentence for welfare fraud and the section 186.11, subdivision (a)(3) enhancement. As so modified, Luu's judgment is affirmed. The trial court shall prepare an amended abstract of judgment to reflect these changes.

FACTUAL BACKGROUND

Lai and Luu, then husband and wife, first applied for welfare in 1980; they reported no income, bank accounts, cars, cash, or property. Both were born in Vietnam. The Department of Public Social Services (DPSS) first issued welfare benefits to them under the Refugee Assistance Program.

Lai and Luu were legally divorced in 1987. The stipulated judgment of dissolution stated that Luu was receiving welfare and that Lai was unemployed. The judgment did not require Lai to pay Luu any child support for their five children. Thereafter, Lai and Luu each continued to report their residence address as being 7925 East Graves Avenue in Rosemead, California.

Unknown to DPSS, Lai operated a successful plumbing business beginning in 1985. Lai's tax return for 1988 showed a profit of about $133,000. In 1989 he reported gross business income of about $658,000, and in 1990 he reported gross business income of about $311,000. On tax returns for the years 1994 through 1999, Lai reported wages or salary between $47,000 and $83,000 annually.

Lai signed an immigration affidavit in 1991 stating that he had $80,000 in savings, $20,000 in personal property, annual income of $132,000, and real estate valued at $600,000 with a $410,000 mortgage.

Luu completed and filed various forms for welfare programs including AFDC, food stamps, and MediCal programs from 1980 until 2000, when her aid was terminated. She reported no income or assets to DPSS from 1985 through 1999.

Luu filed tax returns in 1996 through 2000, reporting wages of $3,841, $6,132, $9,236, $8,854, and $10,328 for those years.

In 1999, DPSS learned that one of Luu's five children was working and apparently contributing to the household income, and that Luu was not reporting the income. DPSS issued Luu a notice of action in December 1999. An investigation ensued, during which Luu first told DPSS investigators that Lai was her cousin, and then that he was her roommate. Finally, she admitted that he was her ex-husband and the father of her children. She said he did not support her or the children so she did not report him as a provider. After she failed to appear for a scheduled meeting with DPSS, her aid was terminated.

According to DPSS, the total cash overpayment to appellants was approximately $145,000, and the food stamps overpayment was about $45,000. The total overpayment to appellants for MediCal was approximately $41,600.

Investigators seized large amounts of cash from appellants at various locations, including the Rosemead residence, Lai's plumbing business, a vehicle, and safe deposit boxes. The total value of the assets frozen or seized from appellants was approximately $422,500.

DISCUSSION

I. Enhancement Under Sections 186.11, subdivision (a)(3) and 12022.6, subdivision (a)(2)

On count 2, the jury convicted Lai and Luu of welfare fraud (Welf. & Inst.Code, § 10980, subd. (c)(2)), finding that they fraudulently obtained aid "in excess of [$400], to wit: $232,313.57." On that count, as well as count 1 charging conspiracy to commit welfare fraud (§ 182), the jury found true the allegation under section 12022.6, subdivision (a)(2) that Lai and Luu took more than $150,000. On counts 1 and 2, as well as on all the perjury counts (§ 118), the jury found true the allegation under section 186.11, subdivision (a) that the crimes constituted a pattern of related felony conduct involving a taking of more than $100,000.

The trial court sentenced Lai to separate and consecutive two-year terms under both sections 12022.6, subdivision (a)(2) and 186.11, subdivision (a)(3). On appeal, Lai contends that for a taking such as his — more than $100,000, but less than $500,000 — only the additional prison term of section 186.11, subdivision (a)(3) can be imposed, to the exclusion of the term...