State v. Crestani, 870525-CA

• Decision Date: 30 March 1989
• Docket Number: No. 870525-CA,870525-CA
• Citation: 771 P.2d 1085
• Parties: STATE of Utah, Plaintiff and Respondent, v. James V. CRESTANI, Defendant and Appellant.
• Court: Utah Court of Appeals

Page 1085

771 P.2d 1085

STATE of Utah, Plaintiff and Respondent, v. James V. CRESTANI, Defendant and Appellant.

No. 870525-CA.

Court of Appeals of Utah.

March 30, 1989.

John F. Clark, Salt Lake City, for defendant and appellant.

Gregory Bown, David L. Wilkinson, Salt Lake City, for plaintiff and respondent.

Before BILLINGS, DAVIDSON and GARFF, JJ.

OPINION

GARFF, Judge:

Defendant/appellant, James V. Crestani, appeals his conviction of four counts of second degree felony theft and denial of his motion for a new trial. We reverse and remand for a new trial.

Appellant was the sole stockholder of the Alta Title Company (Alta). On February 10, 1982, appellant opened a commercial money market demand checking account (MMD-2), at Sandy State Bank in Sandy, Utah, on behalf of Alta. MMD-2 was one of several accounts Alta used until it ceased doing business in March 1983. A large amount of money flowed through this account; from March through August 1982, $9,448,613.44 was deposited and $9,579,594.90 was withdrawn. During its thirteen month existence, MMD-2 was used as a customer account, a deposit account for contract service fees due to appellant, and appellant's personal account.

On March 14, 1985, a five count information was filed charging appellant with theft of $57,300.00 from MMD-2 during the period of May 7 to August 13, 1982. The gist of the information was that, on five occasions, appellant had withdrawn funds from MMD-2 and used them for his personal benefit, and that this conduct constituted theft because MMD-2 should have been used exclusively for funds held in escrow by Alta for real estate closings.

Shortly after the information was filed, appellant approached attorney Phil L. Hansen to conduct his defense. Hansen agreed to do so for a fee of $50,000.00. In his initial consultation with Hansen, appellant told Hansen that his defense to the charges was that the money he withdrew from MMD-2 was his personal money. He described to Hansen the large amount of preparation he considered to be necessary for his defense, including an audit of MMD-2. Hansen assured appellant that he would do a thorough job and, specifically, that he would identify and interrogate all witnesses, thoroughly review all bank accounts involved, travel to California to prepare appellant and his wife for their trial testimony, hire paralegals to prepare witnesses and exhibits, thoroughly research case law, and perform all other necessary efforts to properly prepare the case for trial.

On May 8, 1985, a preliminary hearing was held at which count 5 of the information was dismissed. Appellant was bound over for trial on the remaining four counts of second degree felony theft. Hansen called no witnesses at this hearing.

On June 6, 1985, appellant was arraigned. During the next two years, four trial dates were set and vacated. On numerous occasions, appellant and his wife unsuccessfully attempted to contact Hansen by telephone and letter regarding the case. However, Hansen did not respond to either written correspondence or telephone calls.

On March 16, 1987, Hansen prepared and served a demand for discovery upon the prosecutor. In this demand, he requested "an itemization of all physical evidence, including a list of all exhibits the prosecution intends to introduce at the time of trial." Hansen also prepared and served upon Sandy State Bank a subpoena requesting production of designated MMD-2 records. The bank did not deliver the records, however, because Hansen failed to pay the bank's requested copying charges.

On March 31, 1987, Hansen filed a motion for continuance of the trial scheduled for April 7. At that time, he had not obtained the MMD-2 records.

Pretrial preparation for appellant's defense was primarily undertaken by Hansen's paralegal. All appellant's contacts with Hansen during this time were through this paralegal or Hansen's secretary, both of whom were repeatedly told by appellant that the MMD-2 records would be critical to his defense because it was these records which contained the requisite exculpatory evidence. The paralegal assured appellant that Hansen would obtain the MMD-2 records.

Several weeks before trial, the paralegal attempted to collect the previously subpoenaed copies of the bank records. Because Hansen had previously not paid for the copies, however, they had become lost, and the paralegal had to reorder them. These records were finally picked up two days prior to trial.

When finally obtained, the subpoenaed records included only the MMD-2 deposit records for March, April, May and June of 1982. Hansen had not requested monthly statements, checks, disbursements, or credit and debit memos for any of these months, nor records for the months of July and August 1982, during which the events leading to count 4 of the information allegedly occurred.

Prior to trial, the prosecutor twice offered to allow Hansen to examine the state's evidence and to have an investigator familiar with the case explain it to him. Hansen did not take advantage of these offers.

Five weeks prior to trial, the paralegal attempted to assist Hansen in pre-trial preparation. However, Hansen was out of the office for long periods of time during this five week period and, ultimately, did not begin to review the file until two days before the trial began. Consequently, Hansen first contacted witness Gary Carlson two days before trial and witness James McIntyre the day before trial.

On the evening before trial, Hansen finally met with appellant and his wife. At that time, appellant observed that Hansen had only obtained MMD-2 deposit records for the four month period. When he asked where the rest of the account records were, Hansen replied, "That's all we need. They don't have a case." Appellant also asked Hansen why he had not secured the attendance of Blake Hammond, a former Alta vice president who had relocated to Phoenix, Arizona. Hansen admitted he had not subpoenaed Hammond, but told appellant that he thought that they "did not need Hammond." Hansen further failed to inform appellant's wife that she would be a witness at trial, even though, as escrow department manager at Alta in 1982, she had been in charge of some of the deposits made into MMD-2. He also failed to review the deposit records with her or to prepare her to testify at trial.

The trial lasted from July 7 to 11, 1987. In Hansen's opening statement, he stated that he would show that appellant had "a great deal of" personal money in MMD-2, sufficient to cover the withdrawals that were the bases of the charges in the information, and that appellant's wife would "go through everything" to clarify the deposits of personal money.

Hansen called James A. McIntyre as a defense witness. Through McIntyre's testimony, he attempted to establish that appellant had made several deposits of personal funds into MMD-2. However, Hansen did not provide McIntyre with any documentary evidence to substantiate his testimony or to refresh his recollection. Consequently, McIntyre was unable to recall several of the transactions, and could not recollect, other than in general terms, the dates and exact amounts involved in other transactions. On cross-examination, McIntyre admitted he really did not know, but only assumed, that funds which appellant deposited in MMD-2 were his personal funds.

Hansen then called appellant's wife as a witness and attempted to have her verify appellant's deposits of personal funds into MMD-2 during 1982 from memory, without referring to specific records. She testified that appellant had made two $100,000.00 deposits; had taken out a personal loan for $17,082.00 to purchase a boat, the proceeds of which he had deposited in MMD-2; and had made deposits of $15,000.00, $19,896.53, and a large number of $50.00 deposits which allegedly were agency fees due personally to appellant. Finally, she alluded to a personal deposit by appellant of about $8,000.00.

On cross-examination, however, the prosecutor pointed out that appellant's wife was testifying from memory in spite of having had many years to locate the deposit records about which she had testified, and confronted her with records showing: (1) that there were no $100,000.00 deposits; (2) an unexplained $17,082.00 withdrawal occurred two days after a $17,082.00 deposit was made; and (3) that the $15,000.00 and $19,869.73 deposits she had identified were immediately withdrawn from MMD-2 and, thus, were not available to cover the charged withdrawals. Hansen objected to this line of questioning on the grounds that he had not previously seen or been given an opportunity to examine the documents. The prosecutor responded that he had twice offered Hansen the opportunity to examine all of the state's evidence, but Hansen had failed to do so.

The court recessed for the evening and instructed Hansen and the prosecutor to go over the bank records that the prosecutor had intended to use to cross-examine appellant's wife.

The following day, on further cross-examination, the prosecutor established that appellant's wife withdrew $15,000.00 on the same day that it was deposited into MMD-2. Because she had not reviewed any of the documents, appellant's wife was surprised by this information. On further cross-examination, the prosecutor was able to show that another $19,896.73 deposit of appellant's personal funds was also withdrawn on the same day it was deposited. The prosecutor, likewise, established that many of the $50.00 agent fees that appellant claimed were his personal funds were withdrawn from MMD-2 and paid into another Alta account.

Hansen then called appellant as a witness and attempted to show that appellant had placed personal funds in MMD-2 at various times. However, except for small deposits from his personal account, appellant was only able to testify from memory because no documents were provided to establish exact deposit amounts.

The prosecution's evidence further showed that MMD-2 was...