State v. Hurst, s. 18089

• Decision Date: 10 November 1993
• Docket Number: 18090,Nos. 18089,s. 18089
• Citation: 507 N.W.2d 918
• Parties: STATE of South Dakota, Plaintiff and Appellee, v. Willard HURST, Jr., Defendant and Appellant. STATE of South Dakota, Plaintiff and Appellee, v. Telford TOFFLEMIRE, Defendant and Appellant.
• Court: South Dakota Supreme Court

Page 918

507 N.W.2d 918

STATE of South Dakota, Plaintiff and Appellee, v. Willard HURST, Jr., Defendant and Appellant.

STATE of South Dakota, Plaintiff and Appellee, v. Telford TOFFLEMIRE, Defendant and Appellant.

Nos. 18089, 18090.

Supreme Court of South Dakota.

Argued Sept. 1, 1993.

Decided Nov. 10, 1993.

Mark W. Barnett, Atty. Gen., Charles M. McGuigan, Asst. Atty. Gen., Pierre, for plaintiff and appellee.

Stan H. Anker, Rapid City, for defendant and appellant, Hurst.

Curt R. Ewinger, Rice and Ewinger, Aberdeen, for defendant and appellant, Tofflemire.

SABERS, Justice.

Defendants appeal their convictions for conspiracy to commit theft by deception and theft by deception. We affirm.

1. Theft by Deception ¹

State claims that defendants Willard Hurst, Jr. (Hurst) and Telford Tofflemire (Tofflemire) contracted with MDS to incinerate MDS' medical waste in Aberdeen, S.D. State further claims that Defendants buried the medical waste in Mellette County, South Dakota instead of incinerating it at Aberdeen as contracted, thereby deceptively obtaining substantial sums of money from MDS and that this conduct constituted conspiracy and theft by deception. Defendants deny State's claims and argue that their conduct merely amounts to a breach of contract. The jury agreed with the State. Hurst and Tofflemire appeal.

Hurst argues that the trial court erred in denying his motion to dismiss Counts I and II of the Indictment, conspiracy to commit theft by deception and theft by deception. Tofflemire argues that the failure to incinerate the medical waste did not constitute theft by deception, but was simply the breach of a contract which had otherwise been substantially performed. SDCL 22-30A-3 provides in part:

Any person who obtains property of another by deception is guilty of theft. A person deceives if with intent to defraud he:

(1) Creates or reinforces a false impression, including false impressions as to law, value, intention or other state of mind; but deception as to a person's intention to perform a promise shall not be inferred from the fact alone that he did not subsequently perform the promise;

(2) Prevents another from acquiring information which would affect his judgment of a transaction[.]

....

The term "deceive" does not, however, include falsity as to matters having no pecuniary significance, or puffing by statements unlikely to deceive reasonable persons.

According to Defendants, the State failed to prove theft by deception because, at the time that they, through their company TW Services (TWS), contracted with Medical Disposal Systems, Inc. (MDS) to provide incineration of their nonhazardous medical waste, they did not plan to bury the waste on Rodney Vollmer's (Vollmer) property. Defendants argue that they are guilty of a "simple breach of contract," rather than theft by deception.

"The statute requires acts of deception to obtain another's property. The statute goes on to require 'intent' and states that such 'intent to defraud' exists if a person 'creates or reinforces a false impression.' " State v. Dale, 439 N.W.2d 98, 107 (S.D.1989). According to the State, in order to obtain the property of MDS, Hurst and Tofflemire created the false impression in the mind of MDS that they would be incinerating its waste when in fact, they were planning on burying it. Defendants reinforced this false impression by writing on the trucking slip "Non Hazardous Medical Waste To be Incinerated at Destination Aberdeen S.D." and issuing fake incineration certificates. Defendants disagree, arguing that initially they intended to incinerate the waste, but decided at a later date to breach the contract and bury the waste.

According to the comments following Sec. 223.3 of the Model Penal Code, ² which is similar to SDCL 20-30A-3, breach of contract is not theft by deception. To constitute theft by deception, the actor must have the purpose to obtain the property of another, and he must have a purpose to deceive. Model Penal Code Sec. 223.3 cmts. 1, 3(b) (1962). "It is only where the actor did not believe what he purposely caused his victim to believe, and where this can be proved beyond a reasonable doubt, that the actor can be convicted of theft." Model Penal Code Sec. 223.3 cmt. 3(b).

Jury Instruction No. 22 provided in part that:

The elements of the offense of theft by deception as charged in Count II of the Indictment, each of which the State must prove beyond a reasonable doubt, are:

....

3. That the Defendant obtained money with the intent to defraud by creating a false impression as to intention, specifically that the medical waste would be incinerated properly; (but you may not infer deception as to the Defendant's intention to perform a promise from the fact alone that he did not subsequently perform the promise)[.]

Under SDCL 22-30A-3(1) and this instruction, the State had to prove that Defendants caused MDS to believe that TWS was going to incinerate the medical waste at Dependable Sanitation's (Dependable) facility in Aberdeen, when, in fact, Defendants knew it was going to be buried in Mellette County.

This case turns on this factual determination. "Where conflicting evidence is present, as in this case, and the credibility of witnesses is in issue, then it is a question of fact for the jury. The jury is physically present at the trial and, therefore, in the best position to judge the demeanor and credibility of the witnesses." State v. Shank, 88 S.D. 645, 226 N.W.2d 384, 387 (1975) (citations omitted).

On cross-examination, Vollmer testified as follows:

Attorney Curt Ewinger: When was the first time that you were approached by either Willard Hurst or Tel Tofflemire concerning this matter?

Vollmer: It was previous to the May 20th agreement.

Ewinger: How long before, approximately?

Vollmer: Six weeks to a month, somewheres in there.

Ewinger: Who contacted you?

Vollmer: Willard Hurst.

Ewinger: What did he say?

Vollmer: He told me about the idea of burying this garbage.

Ewinger: Are you sure he didn't tell you that they were looking for a site to put an incinerator to dispose of medical waste?

Vollmer: He never mentioned that to me that I can recall.

Ewinger: There was no mention to you about an incinerator at the May 20, 1989 meeting?

Vollmer: I don't remember them talking about incinerating.

Ewinger: You don't remember anybody talking to you about using your pole barn to store this medical waste until such time as there was an incinerator purchased or built?

Vollmer: I don't recall anything like that.

....

Ewinger: And it was your idea to store it by burying it and then just covering it with dirt so you could easily dig it back up?

Vollmer: That wasn't my idea at all. It was their deal.

This testimony indicates that Hurst contacted Vollmer to discuss burying waste on Vollmer's property in April, 1989. And yet, TWS and MDS entered into a contract on June 20, 1989 which provided in part that "TWS agrees to provide incineration of all infectious waste material (Non-Hazardous) picked-up by TWS at MDS facilities or transferred to TWS's facility in Aberdeen, SD. TWS shall incinerate said medical infectious waste in a manner consistent with all Federal, State and Local laws and regulations governing the transport and proper disposal of this non-hazardous waste." John Meyers, President of MDS, testified that at the time he signed the contract, it was his understanding that the waste was going to TWS' facility in Aberdeen, South Dakota, and that it was going to be incinerated at that site. He further testified that he understood that the incineration would take place at Dependable, in Aberdeen, South Dakota.

Clearly, this failure to incinerate the waste was more than breach of contract. Defendants had the purpose to deceive. Their plan was to bury the waste on Vollmer's property and yet they purposely caused MDS to believe that the waste would be incinerated properly. The jury found that the State met its burden and the evidence supports that conclusion. See generally Kansas v. Handke, 185 Kan. 38, 340 P.2d 877, 883 (1959) ("It is a false pretense where a man represents himself to be in a situation or business in which he is not.").

Defendants argue that there was not a victim because MDS paid for, and received, the removal and transportation of its waste. Therefore, they claim MDS did not suffer any financial loss and any alleged deception clearly had "no pecuniary significance." We are not persuaded.

A matter can have "pecuniary significance" without resulting in a financial loss. See Arizona v. Mills, 96 Ariz. 377, 396 P.2d 5, 8 (1964) (To constitute the crime of theft by false pretenses, the better rule is that there is no requirement that the victim suffer a pecuniary loss so long as he parted with his property. Financial loss is not a necessary element of the crime.). Defendants "focus on the wrong part of the transaction. They direct attention to what the victim obtains. The gist of the offense, however, is concerned with what the defrauder obtains. Once the victim has parted with his property in reliance on a false representation, it is immaterial whether whatever he got in return is equal in exchange value to that with which he parted." Id. See also Model Penal Code Sec. 223.3 cmt. 3(d) (falsification as to matters having no pecuniary significance, such as where a salesman misrepresents his political, religious, or social affiliations, is excluded from the scope of the section). As Justice Learned Hand stated in United States v. Rowe,

A man is none the less cheated out of his property, when he is induced to part with it by fraud, because he gets a quid pro quo of equal value. It may be impossible to measure his loss by the gross scales available to a court, but he has suffered a wrong; he has lost his chance to bargain with the facts before him. That is the evil against which the statute is directed.

56 F.2d 747, 749 (2d Cir.1932) (emphasis added), cert. denied, 286 U.S. 554, 52...