State v. Burroughs

• Decision Date: 01 September 1992
• Docket Number: No. 83,83
• Citation: 636 A.2d 1009,333 Md. 614
• Parties: STATE of Maryland v. Eugene L. BURROUGHS. ,
• Court: Maryland Court of Appeals

Page 614

333 Md. 614

636 A.2d 1009

STATE of Maryland v.Eugene L. BURROUGHS.

No. 83, Sept. Term, 1992.

Court of Appeals of Maryland.

Feb. 9, 1994.

Gwynn X. Kinsey, Jr., Asst. Atty. Gen. (J. Joseph Curran, Jr., Atty. Gen., both on brief), Baltimore, for petitioner.

Claudia A. Cortese, Asst. Public Defender(Stephen E. Harris, Public Defender, both on brief), Baltimore, for respondent.

Argued before ELDRIDGE, RODOWSKY, McAULIFFE, CHASANOW, KARWACKI, ROBERT B. BELL, JJ., and CHARLES E. ORTH, Jr., Judge of the Court of Appeals(retired), Specially Assigned.

McAULIFFE, Judge.^*

As a result of financial transactions he had with a couple for whom he served as accountant and insurance agent, Eugene L. Burroughs was convicted of multiple counts of theft by deception and of embezzlement by a fiduciary.He was sentenced to consecutive terms of 15 years imprisonment on two theft convictions, and given concurrent sentences of five years each on two embezzlement convictions.On direct appeal the Court of Special Appeals, in an unreported opinion, held that the element of intent required in the offense of theft by deception is inconsistent with the element of intent required in the offense of embezzlement by a fiduciary, and that the failure of the trial judge to instruct the jury that the defendant could not be found guilty of both offenses was plain error, necessitating reversal of the judgment.We granted the State's petition for certiorari to consider the following question:

Did the Court of Special Appeals err in holding that (a) Burroughs's convictions of theft by deception and fiduciary misappropriation were 'inconsistent,' and (b) the appropriate remedy for the supposed inconsistency was to remand the case for retrial as to all of the convictions?

I.

The defendant is an accountant and an insurance agent.He prepared tax returns for John and Dolores Pendergrass from and after 1980, and in 1983 sold them life insurance policies written by Western Reserve Life Insurance Company, for whom the defendant was then serving as an agent.In May, 1988, the defendant persuaded the Pendergrasses to transfer their life insurance coverage to Zurich American Life Insurance Company(Zurich), for whom the defendant had become a general agent.Several months later, the defendant presented to the Pendergrasses a proposal for deposit of $20,000 into one of their existing Zurich life insurance policies.The defendant suggested that the Pendergrasses obtain the funds for this deposit through a $30,000 second trust to be placed on their home.

The recommended benefits of this plan were that the Pendergrasses would be able to deduct interest payments made on the loan and obtain tax-sheltered interest or dividends at a favorable rate from the insurance company, to be accumulated as a part of the insurance policy and available for withdrawal (and deferred taxation) after the Pendergrasses had retired.The defendant arranged the second trust loan and collected a broker's commission for placing it with the lender.According to the Pendergrasses, the defendant also arranged for a third trust home equity loan, without their advance knowledge or approval and at their expense.

At settlement, on 23 August 1988, the Pendergrasses received a check for $28,372.50, representing the loan of $30,000 less the defendant's fee and certain settlement costs.Additional settlement costs for the loans were paid by withdrawals made against the home equity loan.The Pendergrasses endorsed this check to the defendant at his request, with the understanding that $20,000 would be paid into the Zurich insurance policy, and the balance of $8,372.50 returned to the Pendergrasses as soon as the loan check was "processed."At the time he received the check from the Pendergrasses, the defendant completed a preprinted Zurich conditional receipt for $28,372.50, which he signed as agent for Zurich and delivered to the Pendergrasses.The defendant did not pay the $20,000 to Zurich, nor did he return the balance to the Pendergrasses.Instead, he negotiated the Pendergrasses' settlement check to another party.

On 6 October 1988, before the Pendergrasses learned that the defendant had not paid the money to Zurich, but after they had become concerned about the absence of any communication from Zurich confirming receipt of the funds, the failure of the defendant to return the balance due them, and the expenses the defendant had caused them by placing an unauthorized third-trust loan, they met with him.The defendant told the Pendergrasses at that meeting that if they would give him an additional check for $20,000 for a period of one month, he would return that $20,000 together with an amount sufficient to pay off the third trust--approximately $3,000.The Pendergrasses gave the defendant the additional $20,000.The record does not disclose what the defendant did with that money, but he did not return it and he did not pay the additional funds he had promised.¹

The defendant was convicted on Count 1 of an indictment filed in the Circuit Court for Prince George's County, which charged him with theft by deception, a violation of Article 27, § 342(b) of the Maryland Code(1957, 1987 Repl.Vol.), in connection with the $28,372.50 taken on 29 August 1988.He was also convicted of: Count 4, which charged the same offense for the taking of the additional $20,000 on 6 October 1988; and Counts 3 and 6 which charged embezzlement by a fiduciary in violation of Art. 27, § 132 of the Code in connection with the same 29 August and 6 October defalcations.²

II.

The first question we address is whether the verdicts of guilty of theft by deception (Art. 27, § 342(b)) and of embezzlement by fiduciary (Art. 27, § 132) are inconsistent under the facts of this case, so that the defendant could not lawfully be convicted of both for the same conduct.Section 342(b) of Art. 27 is a part of the consolidated theft statute first enacted by ch. 849 of the Acts of 1978.Section 342 creates a single offense of theft and sets forth alternative elements that may comprise the offense.As we stated in Jones v. State, 303 Md. 323, 333, 493 A.2d 1062(1985), the legislature enacted that statute to "create a single statutory crime encompassing various common law distinctions between particular forms of larceny."Subsection (a) of § 342 is very broad in scope.It provides:

(a) Obtaining or exerting unauthorized control.--A person commits the offense of theft when he willfully or knowingly obtains control which is unauthorized or exerts control which is unauthorized over property of the owner, and:

(1) Has the purpose of depriving the owner of the property; or

(2) Willfully or knowingly uses, conceals, or abandons the property in such manner as to deprive the owner of the property; or

(3) Uses, conceals, or abandons the property knowing the use, concealment, or abandonment probably will deprive the owner of the property.

Subsection (b), under which the defendant was charged, provides:

(b) Obtaining control by deception.--A person commits the offense of theft when he willfully or knowingly uses deception to obtain and does obtain control over property of the owner, and;

(1) Has the purpose of depriving the owner of the property; or

(2) Willfully or knowingly uses, conceals, or abandons the property in such manner as to deprive the owner of the property; or

(3) Uses, conceals, or abandons the property knowing such use, concealment, or abandonment probably will deprive the owner of the property.

Subsection (c) deals generally with criminal possession of stolen property.Subsection (d) proscribes certain conduct with respect to lost, mislaid, or mistakenly delivered property, and subsection (e) deals with the obtaining of services by deception.

Section 341 of Art. 27 makes clear the intent of the legislature in enacting the consolidated theft statute, and the broad reach of that statute.It provides, in pertinent part:

Conduct designated as theft in this subheading constitutes a single crime embracing, among others, the separate crimes heretofore known as larceny, larceny by trick, larceny after trust, embezzlement, false pretenses, shoplifting, and receiving stolen property....

The offense of which the defendant was convicted in Counts 3 and 6 of the indictment is a statutory form of embezzlement involving fraudulent misappropriation by fiduciaries, and is codified at Art. 27, § 132.That section provides:

If any executor, administrator, guardian, committee, trustee, receiver or any fiduciary shall fraudulently and wilfully appropriate to any use and purpose not in the due and lawful execution of his trust, any money or any other thing of value which may come into his hands as such executor, administrator, guardian, committee, trustee, receiver, or in any other fiduciary capacity, or secrete it with a fraudulent intent to appropriate it to such use or purpose, he shall be deemed guilty of embezzlement, and shall be punished upon conviction by imprisonment in the penitentiary for not less than one year nor more than five years.

In holding that the offense of embezzlement by a fiduciary is inconsistent with the offense of theft proscribed by § 342, the Court of Special Appeals relied on its earlier decision in Mattingly v. State, 89 Md.App. 187, 597 A.2d 1027(1991), cert. denied, 326 Md. 177, 604 A.2d 444, cert. denied, 506 U.S. 874, 113 S.Ct. 211, 121 L.Ed.2d 151(1992).The intermediate appellate court did not hold in Mattingly that the two offenses are inherently inconsistent.Rather, the court reasoned from the evidence that was before the jury, the instructions given, and the verdicts rendered, that the jury had found the defendant knew he was not entitled to the money when he received it, and concluded:

Given that finding, Mattingly could not be guilty of fraudulent misappropriation by a fiduciary, because he, in fact, had stolen the checks.His status as a thief preempts his...