State v. Korzuch

• Decision Date: 11 July 1996
• Docket Number: CR-96-0087-PR,Nos. CR-95-0477-P,s. CR-95-0477-P
• Citation: 186 Ariz. 190,920 P.2d 312
• Parties: STATE of Arizona, Appellee, v. Wallace Thomas KORZUCH, Appellant. STATE of Arizona, Appellee, v. Wallace Thomas KORZUCH, Appellant.
• Court: Arizona Supreme Court

Page 312

920 P.2d 312

186 Ariz. 190

STATE of Arizona, Appellee, v. Wallace Thomas KORZUCH, Appellant.

STATE of Arizona, Appellee, v. Wallace Thomas KORZUCH, Appellant.

Nos. CR-95-0477-PR, CR-96-0087-PR.

Supreme Court of Arizona, In Banc.

July 11, 1996.

[186 Ariz. 191] Grant Woods, Attorney General by Paul J. McMurdie, Chief Counsel, Criminal Appeals Section, Monica D. Beerling, Former Assistant Attorney General, Linda L. Knowles, Assistant Attorney General, Phoenix, for Appellee.

Burch & Cracchiolo, P.A. by Daniel Cracchiolo, Daryl D. Manhart, David G. Derickson, Phoenix, for Appellant.

OPINION

MOELLER, Justice.

FACTS AND PROCEDURAL HISTORY

About ten years ago, defendant's business experienced financial setbacks. In order to keep his company afloat, defendant obtained loans from Century Bank. In part, these loans were secured by accounts receivable which did not exist. When the loans failed to save the company, defendant told the bank the receivables were fictitious.

Defendant pled guilty to theft. The superior court placed him on probation for five years and ordered, among other conditions, the payment of $600,000 in restitution to Century Bank in $500 monthly payments.

Defendant found employment in Pennsylvania and was accepted for probation supervision there. His wife did not accompany him to Pennsylvania; she resided in California. By October 1990, defendant had obtained employment in California so that he could spend time with his wife, and his probation supervision was transferred there. In October 1990, the superior court modified the terms of defendant's probation by increasing the monthly payment from $500 to $800, a modification which is not at issue in these appeals.

On May 11, 1993, less than a month before the expiration of the five-year probationary term, a probation officer prepared and filed with the trial court an ex parte petition to modify. The trial judge signed the proposed order by which defendant's probation was purportedly "extended for a period of three years from June 7, 1993 pursuant to A.R.S. 13-902(B)" for the reason that restitution was not complete. This modification also ordered the defendant to make a balloon payment of over $53,000 at the termination of his new, extended probationary period.

It is undisputed that the state never attempted to give defendant or his counsel notice of the filing of the petition to modify or of the court's order granting the modification until after the state advised defendant he was in violation of the modification. On the contrary, defendant's California probation officer told defendant in June 1993, "that his case was terminated and supervision would no longer be required." Testimony at defendant's violation hearing established that it is the common practice of the Maricopa County Probation Department not to give notice of extensions to most out-of-county probationers.

Defendant stopped making restitution payments at the conclusion of his original five-year probationary period in July of 1993. In September 1993, defendant received a letter from a Maricopa County probation officer informing him that he was delinquent in his payments. After learning of the ex parte extension and modification, defendant filed a motion to vacate the modification order, contending that his due process rights were violated by reason of the lack of notice. The superior court denied the motion on the theory that the extension was appropriate because restitution remained unpaid. Defendant appealed that denial to the court of appeals (Appeal No. 1).

While Appeal No. 1 was pending, defendant, on advice of counsel, suspended restitution payments, believing his obligation to make the payments was stayed pending appeal under Rule 31.6, Ariz. R.Crim. P. The state then filed a petition to revoke defendant's probation. The trial court held that the Rule 31.6 provision staying restitution pending appeal applies only to appeals from original convictions, not from later revocation proceedings. The trial court then found defendant in violation of the conditions of his extended probation. At the disposition hearing, the court reinstated defendant's probation for a period of three years beginning July 1, 1994, with monthly restitution payments of $1000. Defendant appealed this order (Appeal No. 2). The trial court again denied defendant's motion to stay restitution payments pending appeal.

Defendant unsuccessfully asked the court of appeals to consolidate the two appeals. As to Appeal No. 1, the court of appeals, by memorandum decision, held that, although defendant should have received notice of the extension, the error was cured in "the October 1994 hearing, where the matter was re-opened and Korzuch had an opportunity to address the probation modification." State v. Korzuch, 1 CA-CR 94-0200, pg. 6 (memo. dec. July 25, 1995). In Appeal No. 2, the court of appeals affirmed the trial court's order finding defendant in violation and reinstating him to probation for another extended term with increased monthly payments.

We granted defendant's petitions for review in both appeals and consolidated the cases in this court. We have jurisdiction pursuant to Ariz. Const. art. VI, § 5(3). See Ariz. R.Crim. P. 31.19, and A.R.S. § 12-120.24. We hold the court of appeals erred in Appeal No. 1 by concluding that the October hearing corrected the lack of notice. Accordingly, the other issues raised in Appeal No. 2 are moot because there was no valid probationary order extant to support a finding of violation.

DISCUSSION

A trial court may extend probation if required restitution has not been paid. See A.R.S. § 13-902(B). ¹ For a felony, such as the one involved in this case, the extension may be for up to three years. Id. § 13-902(B) does not explicitly require notice to the probationer. The question in this case is whether an extension and modification without any attempted notice to the probationer or his counsel violates the probationer's rights. This is a purely legal issue and we review it under a de novo standard of review. See Tallent v. National Gen. Ins. Co., 185 Ariz. 266, 915 P.2d 665 (1996); see also Matter of U.S. Currency Amt. of $315,900.00, 183 Ariz. 208, 211, 902 P.2d 351, 354 (App.1995) (holding constitutional questions and questions of interpretation and application of statutes reviewed de novo ).

Defendant asserts due process rights under both the federal and state constitutions. See U.S. Const. amend. XIV § 1; Ariz. Const. art. II, § 4. The United States Supreme Court has held that the right/privilege distinction is not an adequate touchstone to use in deciding when federal due process is required. See Morrissey v. Brewer, 408 U.S. 471, 481-82, 92 S.Ct. 2593, 2600-01, 33 L.Ed.2d 484 (1972). Thus, although a prisoner has no right to parole, the Fourteenth Amendment guarantee of due process protects a parolee from revocation of parole without notice and a hearing. Id. at 484-490, 92 S.Ct. at 2602-05. Since Morrissey, the Court has also held that the same due process concerns are implicated by the revocation of a probationary term. Gagnon v. Scarpelli, 411 U.S. 778, 781-82, 93 S.Ct. 1756, 1759-60, 36 L.Ed.2d 656 (1973). Morrissey and Gagnon are grounded upon the notion that a court may deny a parolee or a probationer his freedom without the same procedural guarantees as those afforded to non-parolees or non-probationers, but that due process affords some procedural protections even to those with reduced liberty interests.

This case differs somewhat from Gagnon and Morrissey. Here the extension and modification itself does not deprive defendant of his freedom, although, admittedly, a violation of the extension and modification could result in a loss of freedom. Defendant asserts that both federal and state due process entitle him to notice and a hearing before his term of probation is extended or modified. On the federal side, this issue has not yet been addressed by the Supreme Court, but has been answered in the negative by the circuit courts which have considered it. See Forgues v. United States, 636 F.2d 1125, 1126-27 (6th Cir.1980) (finding no constitutional violation in the ex parte extension of probation but requiring notice and right to hearing under court's supervisory power); United States v. Cornwell, 625 F.2d 686, 687-89 (5th Cir.) cert. denied, 449 U.S. 1066, 101 S.Ct. 794, 66 L.Ed.2d 610 (1980) (same); Skipworth v. United States, 508 F.2d 598, 601-03 (3rd Cir.1975) (same); United States v. Carey, 565 F.2d 545, 546-47 (8th Cir.1977) cert. denied, 435 U.S. 953, 98 S.Ct. 1582, 55 L.Ed.2d 803 (1978) (finding no constitutional violation in ex parte extension of probation and declining to invoke supervisory power although notice and hearing are "preferable"). We believe it noteworthy that three of the four federal decisions addressing the issue have required, pursuant to the courts' supervisory power, notice and a hearing prior to extension.

Because Arizona case law differs from the federal case law, we reach a conclusion contrary to the circuit courts, both as to federal and state law. In Arizona, due process has been defined so as to require notice and a hearing if the terms of probation are modified. Nieuwenhuis v. Kelly, 164 Ariz. 603, 606, 795 P.2d 823, 826 (App.1990); see also Green v. Superior Court, 132 Ariz. 468, 471, 647 P.2d 166, 169 (1982) ("[T]he discretionary power given the sentencing court to impose, modify, or revoke probation is limited by several statutory provisions, as well as constitutional due process considerations.") (footnote omitted). An extension of a probationary term is unquestionably a modification of the term. By extending the term, the court subjects the probationer to an additional period during which his liberty is restricted. While the term continues, probation may be revoked and imprisonment imposed without the procedural guarantees provided to non-probationers.

In relying in part upon Nieuwenhuis and Green, w...