People v. McGhee

• Decision Date: 31 July 1987
• Citation: People v. McGhee, 193 Cal.App.3d 1333, 239 Cal.Rptr. 28 (Cal. App. 1987)
• Parties: The PEOPLE of the State of California, Plaintiff and Respondent, v. Milton L. McGHEE, Defendant and Appellant. A023897.
• Court: California Court of Appeals

Page 28

239 Cal.Rptr. 28

193 Cal.App.3d 1333

The PEOPLE of the State of California, Plaintiff and Respondent, v. Milton L. McGHEE, Defendant and Appellant.

A023897.

Court of Appeal, First District, Division 4, California.

July 31, 1987.

Certified for Partial Publication ^*

Review Denied Nov. 15, 1987.

John Doyle, San Francisco, for defendant and appellant.

John K. Van de Kamp, Atty. Gen., George C. Spanos, Deputy Atty. Gen., Sacramento, Bruce M. Slavin, Deputy Atty. Gen., San Francisco, for plaintiff and respondent.

SABRAW, Associate Justice.

Defendant was convicted of three counts of grand theft. (Pen.Code, § 487.) He appeals from the judgment of conviction arguing: (1) the information against him was filed beyond the required statutory time limit (Pen.Code, § 1382, subd. (1); (2) insufficient evidence was presented at the preliminary hearing to hold him to answer on two of the charges; (3) his motion for change of venue was erroneously denied; (4) his motion to sever was erroneously denied; (5) improper jury instructions were given; (6) improper rebuttal testimony was introduced; (7) improper testimony from defendant's state bar hearing was introduced; and (8) his Wheeler motion was erroneously denied. We find these arguments have no merit and affirm the judgment of conviction.

I. FACTS AND PROCEDURE

The facts center around a series of improper loan transactions (the "CET transaction" and the "Janmohamed transaction".) We address first the facts concerning the CET transaction.

Defendant was the attorney and secretary for a real estate investment known as Commonwealth Equity Trust (CET). The trust used money from individual investors to buy real estate. Loans, payments and any type of self-dealing was prohibited by the trust agreement.

However defendant, in need of money to pay off a lawsuit settlement in an action brought against him by a former client, arranged to borrow money using CET assets as collateral. He contacted the manager of a Sacramento branch of Lloyd's Bank, Harry Paris, to discuss the loan. Paris was unable to approve the loan because it was above his limit. He told defendant he would submit the proposal to the bank's regional office in Fresno. He also asked for information regarding the legality of the loan.

Defendant also contacted Andrew Tolli, a friend of defendant's and chairman of the board of CET, and told him he needed a recommendation so he could get a line of credit with Lloyd's Bank. Tolli agreed he would help as long as it did not involve trust money. Defendant then delivered two letters to Tolli. In the first he explained he needed the money because he had "helped some people and they are now seeking to renege." He claimed trust certificates would not be disturbed at all. However, the second letter was one to Paris prepared for Tolli's signature. It pledged certificates of deposit to defendant as an accommodation in securing a loan or line of credit, and falsely claimed defendant had discussed the matter with the Corporate Commissioner's Office and no objection to the transaction existed. Although confused by the letters, Tolli signed the one to Paris.

Defendant gave the letter to Paris who sent it to his supervisor, Cole, in Fresno, along with a credit report stating the loan was to be $300,000 and for the purpose of financing defendant's law practice. It was to be repaid in six months. However Cole refused to approve the loan saying it was in violation of the trust agreement. Paris relayed this information to defendant. Defendant submitted a letter saying the transaction was legal and had been sanctioned by the corporations commissioner. Cole still refused to approve the loan. He said if defendant wanted the money CET would have to borrow it and then lend it to him. However this required Tolli to sign the appropriate documents.

Defendant then telephoned Tolli and told him the trust needed $250,000 and that he would send the necessary papers for him to sign. He did so and Tolli signed them. The loan to CET was then approved. However, at trial when these papers were introduced a notation on them indicated defendant's personal account was to be credited. Tolli claimed this notation was not on the papers he signed.

Defendant later obtained another $100,000 in much the same way. He testified he used the money to pay off the settlement judgment and for other "personal and corporate matters."

Subsequently the company that managed CET's books became aware of the loan and they notified CET's independent auditor. Tolli was also notified about the loan and was stunned. In the meantime the loans became due. Defendant again had to borrow money in order to pay off these debts. This constitutes the "Janmohamed transaction."

Through one of defendant's clients, John Banks, defendant learned of some possible investment property in Fairfield known as the Waterman Ranch. Defendant met with some investors to discuss purchasing the property. The group agreed defendant would act as their attorney and defendant's co-defendant Reinaldo as their real estate broker. A bank account under the name "Waterman Investment Group" was opened with defendant as sole signatory.

One of the investors was a Dr. Janmohamed, who arranged for a letter of guaranty for $250,000 to be sent from a Bank in England. Since he was leaving on a trip he gave Reinaldo a limited power of attorney with instructions that if the property was to be purchased his family in East Africa could be contacted and arrange to have the money sent. Although the property was eventually sold to another party Reinaldo arranged to have the money sent to the United States.

Reinaldo then contacted Banks and told him defendant needed to borrow $350,000 for a short period of time. Banks agreed to loan him $200,000. Defendant approached another investor in the Waterman Group, McIntosh, and arranged for a $50,000 loan. He told him he needed the money for a property venture in Reno. He then got another $100,000 from Lloyd's Bank secured by a certificate of deposit from proceeds from the sale of a building he owned. With this $350,000 he paid off the CET loans.

However, soon thereafter defendant again ran into trouble when Banks began pressuring him to repay the $200,000. While this was going on Reinaldo was trying to track the money sent from Dr. Janmohamed, which had become lost in the banking system. The check, payable to Title Insurance and Trust Company, was eventually found. Defendant had it endorsed to the Waterman Investment Group Account at Lloyd's Bank. He then made out a check from the Investment Account to his professional account for $225,000. He used this money to repay Banks. Dr. Janmohamed later found out about this when he returned from his trip. Defendant was unable to pay him back. However, at this point defendant was indicted by the grand jury.

II. ANALYSIS

A. Failure to File Information Pursuant to Penal Code section 1382, subdivision (1)

On December 4, 1980, the grand jury indicted defendant on three counts of embezzlement (Pen.Code, § 532), two counts of false pretenses (Pen. Code, § 502) and one count of conspiracy (Pen.Code, § 182.) Defendant requested a post-indictment preliminary hearing and the parties agreed that the indictment would be treated as a "complaint" for this purpose. A number of motions followed and then on July 1, 1982 the prosecution filed a motion to file a first amended information. At this point the question arose as to what this information would be amending. Apparently no formal information had ever been filed.

Defendant immediately filed a motion to dismiss claiming the failure to file an information within 15 days of the holding order violated Penal Code section 1382, subdivision (1). A hearing was held and the judge denied the motion. Although he doubted that the prosecution had shown good cause for the delay, he found defendant had waived his right to have the charges dropped.

On appeal defendant argues he did not waive his right to have an information filed within 15 days and such an important right, associated with his right to a speedy trial, cannot be waived. Furthermore he claims the amended information was filed after the statute of limitations had run on the offenses. We agree with defendant that once he requested a post-indictment hearing, the better procedure would have been for the prosecutor to immediately file an information following the holding order. (See Hawkins v. Superior Court (1978) 22 Cal.3d 584, 594, 150 Cal.Rptr. 435, 586 P.2d 916; Martinez v. Superior Court (1980) 106 Cal.App.3d 975, 978, 165 Cal.Rptr. 267; People v. Municipal Court (Kong) (1981) 122 Cal.App.3d 176, 187, 175 Cal.Rptr. 861; Cal.Rules of Court, rule 227.3(a)(1).) Nevertheless, we find defendant's arguments are meritless.

We begin by addressing briefly defendant's statute of limitations argument. His claim is as follows: The offenses in question occurred between June, 1978 and March, 1979. Although the indictment was filed on December 4, 1980, the amended information, which alleged new charges, was not filed until July, 1982. By that time the then three-year statute on the alleged crimes had run. Thus, under the authority of People v. Chapman (1975) 47 Cal.App.3d 597, 121 Cal.Rptr. 315, the judgment must be reversed.

Defendant's argument must be rejected. The indictment charged him with the crimes of embezzlement and false pretenses. The amended information charged him with grand theft. The crime of grand theft includes that of embezzlement and false pretenses. (People v. Britz (1971) 17 Cal.App.3d 743, 751, 95 Cal.Rptr. 303; Pen.Code, § 487, subd. (1).) Thus no new offense was charged. Furthermore People v. Chapman, supra is distinguishable. There the information was amended to include not only the original charge of rape but that of rape with a victim under 18 years old. The amendment was filed more than three years after the rape had allegedly occurred. The court found the prosecutor...