State v. Hess

• Decision Date: 23 September 1980
• Docket Number: No. 79-1760-CR,79-1760-CR
• Citation: 298 N.W.2d 111,99 Wis.2d 22
• Court: Wisconsin Court of Appeals
• Parties: STATE of Wisconsin, Plaintiff-Respondent, v. Charles HESS, d/b/a C & C Construction, Defendant-Appellant.

Page 111

298 N.W.2d 111

99 Wis.2d 22

STATE of Wisconsin, Plaintiff-Respondent, v. Charles HESS, d/b/a C & C Construction, Defendant-Appellant.

No. 79-1760-CR.

Court of Appeals of Wisconsin.

Submitted on Briefs Aug. 20, 1980.

Opinion Released Sept. 23, 1980.

Opinion Filed Sept. 23, 1980.

[99 Wis.2d 24] Frank J. Schiro and Salza & Schiro, Ltd., Milwaukee, on brief, for defendant-appellant.

Bronson C. La Follette, Atty. Gen., Thomas J. Balistreri, Asst. Atty. Gen., on brief, for plaintiff-respondent.

Before DECKER, C. J., MOSER, P. J., and CANNON, J.

CANNON, Judge.

Defendant appeals from a judgment of conviction for theft by contractor contrary to secs. 289.02(5) ¹ and 943.20(1)(b) ², Stats. Defendant and Richard Tubbs (Tubbs) were engaged as general contractors doing business as C & C Construction, Inc. Defendant was primarily responsible for the "field work," and Tubbs was primarily responsible for the "books," although it appears that this allocation of duties was not exclusive. Neither Tubbs nor the company secretary, Debbie Opitz, could be located for the purpose of testifying at this trial.

On appeal, defendant[99 Wis.2d 25] challenges the sufficiency of the complaint, the sufficiency of the evidence presented at the preliminary examination and at trial, and the adequacy of the jury instructions. We affirm the trial court's determination as to each of these matters.

Bradley and Kathleen Miller (Millers) negotiated a contract with defendant for the construction of a home whereby defendant was to be the prime contractor. All construction details were negotiated with defendant, although only Tubbs was present when the contract was signed. A construction mortgage for $64,000 was arranged through Hopkins Savings and Loan (Hopkins). Pursuant to this mortgage, an escrow fund was established to be used to reimburse the prime contractor and subcontractors for work completed. In order to draw on the escrow fund, defendant had to submit a statement breaking down the expenses for which reimbursement was sought, lien waivers ³ from each subcontractor, and an authorization from the homeowners to release the funds. Hopkins was also required to inspect the property to see that the work was completed prior to releasing the funds. At no time was permission given by either the homeowners or Hopkins to use the funds released for purposes other than those stated on the breakdown statement.

Three draws ⁴ totaling $36,623 were made by defendant on the escrow fund. All checks were negotiated. The first draw was made July 15, 1977 for $21,095. Of this amount $3,400 was stated on the breakdown sheet to be paid to Ver Halen, Inc. (Ver Halen) for the installation of windows. Ver Halen billed defendant for the actual installation cost, $3,130.40, however, no payment was ever made. The second draw was made October 7, 1977 for $7,700. ⁵ Of this amount $1,500 was to be used to pay the roofing subcontractor, Specialty Associates (Specialty). Defendant was billed $1,162 on November 18, 1977, although no payment was ever made to the roofing subcontractor. The third draw was made November 21, 1977 for $7,828. ⁶ Of this amount $2,315 was to be paid to Mequon Heating and Sheet Metal (Mequon) for the installation of the heating system. In each case lien waivers and authorizations were submitted. No payment was ever received by Ver Halen, Specialty or Mequon.

When payment was not forthcoming from defendant the subcontractors contacted the Millers. The Millers in turn contacted the defendant who assured them that payment would be made. When payment was not made, the Millers contacted Hopkins and authorized it to stop payment to the defendant. Defendant stopped construction, and construction was completed by another contractor.

A criminal complaint was filed against defendant February 2, 1979. At a preliminary hearing held February 8, 1979, defendant was bound over for trial. Trial was held October 15-17, 1979, at the conclusion of which the jury returned a verdict convicting him of the theft by contractor. Judgment was entered on the conviction and the sentence on October 17, 1979. Notice of appeal was filed November 14, 1979.

Defendant raises the following contentions on appeal:

1. That the complaint is defective in failing to allege that defendant retained funds contrary to his authority as trustee;

2. That insufficient evidence was adduced at the preliminary examination to furnish probable cause that defendant had retained the funds contrary to his authority and with the requisite intent required to support the charge;

3. That the trial court erred in failing to give defendant's requested jury instructions and his theory of defense; and

4. That insufficient evidence was adduced at trial to establish that defendant acted contrary to his authority, and that defendant acted with the requisite intent to support a conviction for theft by contractor.

We find these contentions to be without merit and affirm.

ELEMENTS OF THE OFFENSE

At the outset, we find it necessary to set forth the elements necessary for a conviction under secs. 289.02(5) and 943.20(1)(b), Stats.: (1) the defendant acted as a prime contractor; (2) the defendant received money for the improvement of land from the owner or a mortgagee; (3) the defendant intentionally used the money for purposes other than the payment of bona fide claims for labor or materials prior to the payment of such claims; (4) the use was without the owner or mortgagee's consent, and contrary to the defendant's authority; (5) the defendant knew the use was without consent and contrary to his authority; and (6) the defendant used the money with the intent to convert it to his own use or the use of another.

The only difference between a civil and a criminal action for theft by contractor is that for a criminal conviction the state has an additional burden of proving that defendant acted with wrongful intent beyond a reasonable doubt. State v. Wolter, 85 Wis.2d 353, 362, 270 N.W.2d 230, 235 (Ct.App.1978).

Defendant argues that proof of a mere wrongful intent is insufficient, but rather an intent to defraud must be proven. In support of this position defendant cites State v. Blaisdell, 85 Wis.2d 172, 270 N.W.2d 69 (1978) wherein the court states that in a criminal case "the state must prove intent to defraud beyond a reasonable doubt." Id. at 179, 270 N.W.2d at 73. We find the distinction urged by defendant would only serve to obfuscate the court's purpose. The court was merely attempting to elucidate that some additional element of culpability, whether it be denominated as wrongful, criminal, fraudulent, felonious, or wrongfully fraudulent, must be shown to sustain a criminal conviction for theft by contractor. All of these terms are used by our supreme court and this court to delineate the type of intent which distinguishes a criminal from a civil action. See, e. g., State v. Wolter, supra, 85 Wis.2d at 362, 371, 270 N.W.2d at 235, 239; Burmeister Woodwork Co. v. Friedel, 65 Wis.2d 293, 301-02, 222 N.W.2d 647, 651-52 (1974). From this looseness of language, we conclude that proof of an "intent to defraud" in an action for theft by contractor requires no more than the production of sufficient probative evidence to establish criminal intent. It is further evident that this elusive element may be inferred from the defendant's conduct. State v. Blaisdell, supra, 85 Wis.2d at 179, 270 N.W.2d at 73. The court in Blaisdell states:

"(I)ntent is a state of mind which can be evidenced only by words or conduct of the person who is claimed to have entertained it. The jury was under no obligation to accept the direct evidence of intent furnished by the defendant, and must be permitted to infer intent from such of the defendant's actions as objectively evidence his state of mind." Id. at 180, 270 N.W.2d at 74. (quoting State v. Kuenzli, 208 Wis. 340, 347, 242 N.W. 147, 149 (1932).)

SUFFICIENCY OF THE COMPLAINT

Defendant contends that the complaint is defective in failing to set forth facts sufficient The standard for testing the sufficiency of a complaint has been recently set forth in State v. White, 97 Wis.2d 193, 295 N.W.2d 346 (1980):

to establish that defendant acted contrary to his authority. We do not agree.

The criminal complaint must answer the following five questions before it will be deemed to state probable cause: (1) Who is charged?; (2) What is the person charged with?; (3) When and where did the alleged offense take place?; (4) Why is this particular person being charged?; and (5) Who says so? or How reliable is the informant? Id. at 203, 295 N.W.2d at 350.

A complaint is sufficient if it states sufficient facts which, when taken together with the reasonable inferences arising therefrom, constitute probable cause. Lofton v. State, 83 Wis.2d 472, 478, 266 N.W.2d 576, 578 (1978).

Applying these standards to the complaint herein we find it contains sufficient facts to constitute probable cause. First, Charles Hess (Hess) is identified as the person charged. Second, the complaint contains both a statutory reference to secs. 289.02(5) and 943.20(1)(b), Stats., as well as a statement describing the nature of the charge, theft by contractor. Third, the complaint sets forth pertinent details regarding the construction contract, the mortgage, the amounts and dates of the draws, the purpose of the draws, their negotiation, the nonpayment of certain contractors, and that this was without the owners' consent. Fourth, the complaint indicates that defendant is charged because he negotiated the construction contract, payment was made to him as a result of the negotiation of the draws, and despite requests made to him personally by the Millers the subcontractors were not paid. Fifth, Kathleen Miller is listed as the complainant. We hold that a magistrate presented with these facts could reasonably conclude that the funds were retained contrary to defendant's authority as general contractor....