State v. Bruun, 20160466-CA
| Decision Date | 09 May 2019 |
| Docket Number | No. 20160466-CA,20160466-CA |
| Citation | 443 P.3d 756 |
| Parties | STATE of Utah, Appellee, v. Allan BRUUN, Appellant. |
| Court | Utah Court of Appeals |
Clifton W. Thompson, Attorney for Appellant
Sean D. Reyes, Jeffrey S. Gray, and Jacob S. Taylor, Salt Lake City, Attorneys for Appellee
Opinion
¶1 This case presents the question of whether a civil settlement between a victim and a defendant, entered into prior to entry of an order of complete restitution in a related criminal case, precludes the victim from enforcing that restitution order once it is entered as a judgment on the civil docket. In light of the plain language of, and the well-recognized purposes for, the Crime Victims Restitution Act, we conclude that a prior civil settlement does not preclude enforcement of a restitution judgment provided that the victim does not obtain a double recovery.
¶2 Following a jury trial in 2013, Allan Bruun and James Diderickson (collectively, Defendants) were convicted of twelve counts of theft and one count of engaging in a pattern of unlawful activity, growing out of their criminal conduct perpetrated against Utah County landowners (Victims).2 In 2007, Defendants and Victims entered into a joint business venture to develop 29 acres of land in Saratoga Springs (the Property) that Victims had purchased decades earlier to fund their retirement. Victims partnered with an entity owned by Defendants, Equity Partners LLC, to form Tivoli Properties LLC, whose purpose was to "carry[ ] on the business of acquiring, managing, improving, subdividing, developing, leasing and selling the Property or any other enterprise that members may mutually agree upon." Victims held a 25% interest in Tivoli, and Equity Partners owned the remainder.
¶3 As part of the joint venture, Victims also agreed to sell the Property to Equity Partners for $ 3.5 million, with $ 750,000 due as a down payment. Prior to closing on the sale of the Property, Defendants informed Victims that they were unable to make the $ 750,000 down payment and convinced Victims to take out a loan secured by the Property for that amount to enable commencement of the Property’s development. Approximately $ 350,000 of the loan proceeds was used to pay off existing mortgages and taxes on the Property, and the remaining $ 400,000 was transferred to Tivoli’s business checking account, whereupon that sum became the company’s only operating funds.
¶4 Approximately six months later, Victims discovered that Defendants had written a host of checks on Tivoli’s account that did not appear to be related to the development of the Property. Following Victims’ complaints and ensuing negotiations, Victims and Defendants entered into a settlement agreement (the Settlement Agreement) in which Defendants agreed to transfer title to all but .6 acres of the Property back to Victims. Defendants had already sold the remaining .6 acres to the Utah Department of Transportation, but they agreed to also transfer the proceeds from that sale, $ 174,000, to Victims. In exchange, Victims paid Equity Partners $ 25,000 and agreed to "waive any claim or right to assert any cause of action" against Defendants related to their management of Tivoli. The checks that later gave rise to the theft charges against Defendants were identified in the Settlement Agreement, which recited that Victims released any claims they had concerning the checks.
¶5 Two years later, the State charged Defendants with 28 counts of theft and one count of engaging in a pattern of unlawful activity for writing unauthorized checks on Tivoli’s account. A jury determined that 12 of the 28 checks were unauthorized by Tivoli’s operating agreement and convicted Defendants on twelve counts of theft and one count of engaging in a pattern of unlawful activity. As part of their sentence, the district court ordered Defendants to jointly and severally pay Victims $ 189,574.33 in complete and court-ordered restitution—the aggregate sum of the 12 checks underlying the theft convictions.
¶6 Defendants previously appealed their convictions and the district court’s order of restitution, resulting in our decision in State v. Bruun (Bruun I ), 2017 UT App 182, 405 P.3d 905. In challenging the restitution order, Defendants argued (1) "that the release of claims in the Settlement [Agreement], signed by both Defendants and the Victims, precluded restitution as a matter of law"; and (2) "that the consideration the Victims received as part of the Settlement [Agreement] should have been taken into account in the court’s restitution order." Id. ¶ 80. We were persuaded by neither argument and affirmed the restitution order. Id. ¶ 99.
¶7 Relying on our Supreme Court’s decision in State v. Laycock , 2009 UT 53, 214 P.3d 104, we determined Defendants’ first argument to be unavailing because the State was not a party to the Settlement Agreement, and therefore "the State’s interests [in seeking restitution] were not foreclosed by the release." Bruun I , 2017 UT App 182, ¶ 86, 405 P.3d 905. And regarding Defendants’ second argument, we held it was not an abuse of discretion for the district court to determine that evidence of the Property’s value was too speculative and unreliable to conclude that return of the Property necessarily compensated Victims in full for the unauthorized checks, id. ¶ 98, and that "Defendants ha[d] also failed to persuade us that the trial court’s actual restitution award amounted to a double recovery," id. ¶ 94.
¶8 During the pendency of Bruun I , Defendants moved the district court for an order of satisfaction of judgment pursuant to rule 58B of the Utah Rules of Civil Procedure. They argued that because the Settlement Agreement referenced the 12 checks that were the subject of the restitution order and included an express release of Victims’ claims concerning the same, they were entitled to an order of satisfaction of judgment once the complete restitution order was entered as a judgment on the civil docket. See Utah Code Ann. § 77-38a-401(1) (LexisNexis Supp. 2018). After recognizing that Defendants’ motion involved "issues of law which are of first impression," the district court denied the motion. The court’s denial of this motion is the target of Defendants’ current appeal.
¶9 Whether a prior settlement agreement can satisfy an order of complete restitution after the restitution order is entered as a judgment on the civil docket presents a question of law, which we review for correctness. See Pilot v. Hill , 2019 UT 10, ¶ 9, 437 P.3d 362 ().
¶10 The Crime Victims Restitution Act (the Act) requires a district court to "determine complete restitution and court-ordered restitution,"3 Utah Code Ann. § 77-38a-302(2) (LexisNexis 2017), and to subsequently "enter an order of complete restitution ... on the civil judgment docket," id. § 77-38a-401(1) (Supp. 2018). Such an order "shall be considered a legal judgment, enforceable under the Utah Rules of Civil Procedure," thereby affording the victim or the Department of Corrections the rights to "enforce the restitution order as judgment creditor under [those same rules]." Id. § 77-38a-401(2) (emphasis added).4
¶11 Citing this provision of the Act and relying on rule 58B(b) of the Utah Rules of Civil Procedure, Defendants argue that once the complete restitution order was reduced to a civil judgment, they were entitled to an order of satisfaction of that judgment. See Utah R. Civ. P. 58B(b) (). Specifically, Defendants contend that their compliance with the terms of the Settlement Agreement—the one they and Victims executed two years prior to the commencement of criminal proceedings and which referenced the 12 checks Defendants wrote on the Tivoli account—served as "satisfactory proof" that the judgment had been satisfied. Defendants assert that through their efforts to re-zone the Property, its value increased between the time Victims sold it to Equity Partners and the time it was conveyed back to Victims pursuant to the Settlement Agreement, and that this increase in value was sufficient to satisfy the complete restitution amount of $ 189,574.33.5
¶12 Defendants correctly state that upon agreement between the parties, a judgment debtor’s obligation to the judgment creditor may be satisfied under rule 58B(b) of the Utah Rules of Civil Procedure by means other than direct monetary payment. See Red Bridge Capital LLC v. Dos Lagos LLC , 2016 UT App 162, ¶ 10 n.2, 381 P.3d 1147 (). But that rule contemplates agreement between the parties after judgment is entered. We are still left with the task of determining whether the Act permits a settlement entered into prior to entry of a restitution judgment on the civil docket to satisfy that judgment. See infra ¶ 16.
¶13 In support of their position, Defendants cite State v. Laycock , 2009 UT 53, 214 P.3d 104. In Laycock , our Supreme Court addressed the issue of whether a civil settlement between a defendant and a victim barred the imposition of restitution in a subsequent criminal action arising from the same incident. See id. ¶ 12. The Court determined that such civil settlements did not bar the imposition of restitution by the district court because the controversy between the State and the defendant was not finished and the twin purposes of restitution, i.e., to...
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Diderickson v. State
...to pay [the Poseys] the full restitution judgment in the amount of $ 189,574.33. State v. Bruun (Bruun II ), 2019 UT App 77, ¶ 23, 443 P.3d 756.ISSUES AND STANDARD OF REVIEW ¶22 We granted certiorari on two issues. Petitioners first ask us to review the court of appeals’ affirmance of the d......