People v. Nappo
Citation | 94 N.Y.2d 564,708 N.Y.S.2d 41,729 N.E.2d 698 |
Parties | THE PEOPLE OF THE STATE OF NEW YORK, Respondent, v. WILLIAM S. NAPPO, WILLIAM K. NAPPO and JOHN ROCCO, Appellants, et al., Defendants. |
Decision Date | 13 April 2000 |
Court | New York Court of Appeals Court of Appeals |
Mark L. Freyberg, New York City, Ronald P. Fischetti and Covington & Burling (Gerard E. Lynch of counsel), for William S. Nappo and another, appellants.
Legal Aid Society, Riverhead (George Grun and Robert C. Mitchell of counsel), for John Rocco, appellant.
James M. Catterson, Jr., District Attorney of Suffolk County, Riverhead (Glenn Green of counsel), for respondent.
The issue here is whether defendants' failure to pay taxes on motor fuel imported from New Jersey to New York constitutes larceny from New York State on the theory that New York was the owner of the unpaid taxes. We conclude that it does not.
In March 1997, defendants William S. Nappo, William K. Nappo and John Rocco were indicted, along with five additional individuals, and charged, in the first three counts, with enterprise corruption (Penal Law § 460.20), conspiracy in the fourth degree (conspiring to commit grand larceny in the first degree) (Penal Law § 105.10 [1]) and grand larceny in the first degree (Penal Law § 155.42), as well as a host of Tax Law offenses, including violation of Tax Law § 1812. The full 12-count indictment alleged defendants' involvement in a scheme to import motor fuel from New Jersey to New York without filing reports or paying "motor fuel taxes" as required by the New York Tax Law.
County Court dismissed counts one, two and three of the indictment, with leave to resubmit the charges to another Grand Jury. On the People's appeal, the Appellate Division reinstated both the larceny and conspiracy charges, stating, "The Grand Jury evidence is sufficient to establish a prima facie case that [defendants] withheld property from its rightful owner, i.e., the State of New York, as defined by the Penal Law" (261 AD2d 558, 559). A Judge of this Court granted defendants leave to appeal. We now reverse and dismiss the larceny and conspiracy charges.
The People contend that defendants were required to pay taxes on the importation and distribution of motor fuel in New York State and that their failure to do so constituted a larceny of property owned by the State of New York. Defendants counter that, as a matter of law, the State is not the "owner" of the uncollected taxes.
The State of New York is not an owner, as defined by the Penal Law, of taxes required to be paid for the importation and distribution of motor fuel. The taxes due were not the property of the State prior to their remittance. Accordingly, defendants did not steal money that belonged to New York State, but rather failed to make payments of taxes which were their personal obligations under the Tax Law (see, People v Zinke, 76 NY2d 8, 12).
Our conclusion is supported both by the Penal Law and by our precedents. Penal Law § 155.05 (1) defines larceny as stealing property by taking, obtaining or withholding it from an owner thereof. An "owner" is defined as "any person who has a right to possession [of property] superior to that of the taker, obtainer or withholder" (Penal Law § 155.00 [5]).
In People v Jennings (69 NY2d 103, 126-128), we reversed a conviction for larceny when an insured retained insurance proceeds rather than distributing them to clients who had been victims of a warehouse robbery. We held that the clients were not the owners of the proceeds, and thus the defendant could not be convicted of larceny for failure to remit the proceeds to them. In People v Yannett (49 NY2d 296), this Court held that nursing home residents who had paid a higher private rate before a determination that they were eligible for a lower Medicare rate were not owners of the difference between the rates. Thus, the defendant nursing home operator was not liable for a larceny for failing to refund the difference (see also, People v Wilson, 93 NY2d 222 [ ]). Here, as in Jennings, Yannett and Wilson, defendants were not in possession, by trust or otherwise, of monies owned by the State.
The People's reliance on Tax Law § 1817 (k), which overruled the result in People v Valenza (60 NY2d 363, 367), is misplaced. In Valenza...
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