People v. Medjdoubi

• Decision Date: 30 June 1997
• Citation: 173 Misc.2d 259,661 N.Y.S.2d 502
• Parties: , 63 A.L.R.5th 849, 1997 N.Y. Slip Op. 97,393 The PEOPLE of the State of New York, Plaintiff, v. Mohamed MEDJDOUBI, Defendant.
• Court: New York Supreme Court

Page 502

661 N.Y.S.2d 502

173 Misc.2d 259, 63 A.L.R.5th 849,

1997 N.Y. Slip Op. 97,393

The PEOPLE of the State of New York, Plaintiff, v. Mohamed MEDJDOUBI, Defendant.

Supreme Court, New York County.

June 30, 1997.

Robert M. Morgenthau, District Attorney of New York County (Kevin Murphy of counsel), for plaintiff.

William Alford III, New York City, for defendant.

GEORGE B. DANIELS, Justice.

This case raises an important and fundamental question of criminal law over which trial courts are in disagreement. Should the sales tax imposed on a retail sale be included when determining the value of stolen property? The only two Supreme Court decisions which have considered the issue disagree on whether both the pre-tax selling price and the sales tax should be included. This conflict among the trial courts has not been directly addressed by any appellate court. The addition of sales tax will in some cases raise the crime charged from a misdemeanor to a felony, or to a higher class of felony, thereby significantly enhancing the seriousness of the offense and the penalty to be imposed.

The defendant Mohamed Medjdoubi was charged with grand larceny in the fourth degree (Penal Law § 155.30), two counts of criminal possession of stolen property in the fourth degree (Penal Law § 165.45[1], [2] ), and forgery in the second degree (Penal Law § 170.10). The defendant absconded just prior to jury selection, and he was tried in absentia. The defendant had been videotaped unlawfully using a stolen credit card to purchase a leather jacket and two shirts at Saks Fifth Avenue department store. The total sale price of the merchandise was $1,000. With 8 1/4 percent sales tax, the final cost charged to the credit card was $1,082.50.

At the conclusion of the People's case, the defense moved to dismiss the count of grand larceny in the fourth degree and one of the counts of criminal possession of stolen property in the fourth degree (Penal Law § 165.45[1] ). This court reduced those two felony counts to the misdemeanors of petit larceny and criminal possession of stolen property in the fifth degree. The defendant was subsequently convicted by the jury of the two reduced misdemeanor counts and the other two remaining felony counts. This written decision sets forth the basis for the court's ruling.

A person is guilty of grand larceny in the fourth degree or criminal possession of stolen property in the fourth degree when the value of the stolen property "exceeds one thousand dollars." (Penal Law § 155.30[1]; § 165.45[1].) The term "value" as defined in Penal Law § 155.20[1], "means the market value of the property at the time and place of the crime, or if such cannot be satisfactorily ascertained, the cost of replacement of the property within a reasonable time after the crime." When the value of stolen property cannot be established by either its market value or its replacement cost, its value is deemed to be less than $250 (see, Penal Law § 155.20[4] ).

The market value of stolen property is the amount which the thief would have had to pay had he purchased the goods in the market instead of stealing them (see, People v. Irrizari, 5 N.Y.2d 142, 182 N.Y.S.2d 361, 156 N.E.2d 69 [1959] ). This is the appropriate standard even if the thief steals merchandise not for sale, such as free goods or gifts (see, People v. Colasanti, 35 N.Y.2d 434, 363 N.Y.S.2d 577, 322 N.E.2d 269 [1974] ).

In analyzing "market value," the New York Court of Appeals has recognized two legitimate markets, the wholesale market and the retail market. ¹ The market value of property stolen from a wholesaler is the price at which a wholesaler could have sold the property. The market value of property stolen from a retailer is the price at which a retailer could have sold the property.

Both new and used property can be sold on the wholesale or retail market. The existence of a legitimate market for used goods contemplates that sales of the used items occur in the regular course of business, with some regularity and uniformity (see, People v. Vientos, 79 N.Y.2d 771, 579 N.Y.S.2d 633, 587 N.E.2d 271 [1991]; People v. Irrizari, supra). Therefore, just as in the case of new property, where a thief steals used property from a wholesaler or retailer, the market value of such property is the amount the thief would have had to pay had he purchased the used goods in that particular used market.

The market value of property stolen from a consumer is the price of the item reduced for any depreciation or change in its condition which affected its value at the time of the crime (see e.g., People v. Alicea, 25 N.Y.2d 685, 306 N.Y.S.2d 686, 254 N.E.2d 915 [1969] [book value of used car must be reduced to reflect its condition]; People v. Harold, 22 N.Y.2d 443, 293 N.Y.S.2d 96, 239 N.E.2d 727 [1968] [value of pump purchased for $124 plus tax five days prior to theft must reflect that it was no longer new and the effect of the installation operation]; People v. Medina, 111 A.D.2d 653, 490 N.Y.S.2d 491 [1st Dept.1985] [condition of stolen jewelry and the extent of its use or deterioration must be considered] ).

No statutory language, nor Court of Appeals or Appellate Division decision, has articulated any other basis for determining the value of stolen property other than its "market value" or its "replacement cost."

The trial court in People v. Barbuto, 106 Misc.2d 542, 434 N.Y.S.2d 120 (Sup.Ct., Suffolk Co. 1980) held that while sales tax may increase the cost to the buyer in the retail market, it does not increase the stolen property's value. In Barbuto, the defendant fraudulently purchased a television set from a retail store with a bad check. Relying on the Tax Law and New York Code, Rules and Regulations, that court ruled that the pre-tax selling price is the freely negotiated price in the market, and that sales tax is a distinct and separate charge which the retail seller is required to collect for the benefit of the State and locality. However, the trial court in People v. Bazo, 139 Misc.2d 1003, 529 N.Y.S.2d 432 (Sup.Ct., Kings Co. 1988) disagreed that the pre-tax selling price alone is the market value, and held that sales tax should be considered as a component of the market value of goods stolen from an owner-consumer. In Bazo, the defendant stole, from an owner's apartment, a television set which had been purchased a few days earlier. The Bazo court discusses a "postwholesale, postretail * * * consumer-seller market" in which a "well-informed" seller would seek to pass on the cost of sales tax to a "well-informed" buyer.

Although reliance on the Tax Law alone should not determine how the Penal Law definition of value should be established, this court believes that the Barbuto tax analysis is sound, and that the Bazo analysis in reliance on a "consumer-seller market" is flawed. The Court of Appeals has recognized the wholesale market and the retail market as the only two legitimate markets for determining the market value of both new and used property. No "consumer-seller market" exists where goods are regularly and uniformly bought and sold. Only sales which occur in the regular course of business in a recognized wholesale or retail market can be relied upon to establish the market value of new or used property. As the Court of Appeals articulated in People v. Vientos, supra at 772, 579 N.Y.S.2d 633, 587 N.E.2d 271, the fact "that an individual owner was free to sell used equipment to another person does not indicate the existence of a market for used equipment, which contemplates that sales occur with some regularity and uniformity." Therefore, it is not sufficient, for purposes of determining the value of property, simply that a particular individual was willing to purchase the item for a specified price, since such an offer to purchase may be highly speculative (see, People v. Kirkwood, 200 A.D.2d 409, 606 N.Y.S.2d 612 [1st Dept.1994] ).

Where property is stolen from a retail store, the store's list price ordinarily reflects the property's market value (see, People v. Irrizari, supra; People v. Wynn, 176 A.D.2d 375, 574 N.Y.S.2d 83 [3rd Dept.1991] [price tags on stolen garments]; People v. Vanderhall, 168 A.D.2d 655, 563 N.Y.S.2d 517 [2d Dept.1990] [value of video camera as reflected on price...