State v. Modell
| Decision Date | 04 November 1992 |
| Citation | 615 A.2d 1264,260 N.J.Super. 227 |
| Parties | STATE of New Jersey, Plaintiff-Respondent, v. Stuart MODELL, Defendant-Appellant. |
| Court | New Jersey Superior Court — Appellate Division |
Larry Blumenstyk, Morristown, for appellant (Larry Blumenstyk and David Wendel, on the brief; Catherine Langlois, on the reply brief).
Mark Paul Cronin, Deputy Atty. Gen., for respondent (Robert J. Del Tufo, Atty. Gen., attorney; Mark Paul Cronin, of counsel and on the brief).
Before Judges J.H. COLEMAN, SHEBELL and CONLEY.
The opinion of the court was delivered by
SHEBELL, J.A.D.
Defendant, Stuart Modell, appeals from his jury convictions on two counts of third-degree theft by failure to make required disposition of property received (counts one and four) ( N.J.S.A. 2C:20-9); three counts of second degree theft by failure to make required disposition of property received (counts six, eight and ten) ( N.J.S.A. 2C:20-9); two counts of third-degree misapplication of entrusted property (counts two and five) ( N.J.S.A. 2C:21-15); three counts of second-degree misapplication of entrusted property (counts seven, nine and eleven) ( N.J.S.A. 2C:21-15); and one count of third-degree theft by deception (count twelve) ( N.J.S.A. 2C:20-4). He also appeals from the aggregate sentence imposed of seven years with three and one-half years of parole ineligibility.
At the commencement of defendant's first trial, count three was dismissed on the State's motion because the victim was unable to testify as a result of Alzheimer's disease. Defendant's first trial began on June 25, 1990 but ended when the trial judge sua sponte declared a mistrial as to all remaining counts. After the State rested its case in the first trial, defendant moved for dismissal of the counts concerning misapplication of entrusted property on the basis that defendant derived no benefit from the alleged misapplications. The court denied this motion. The defendant also renewed a pretrial motion to dismiss counts four and five because of the statute of limitations. The court found that the elements constituting this crime were completed on August 13, 1984 and that, therefore, the five-year statute of limitations had not yet run when the indictment was returned on August 2, 1989.
On July 2, 1990, as defense counsel was called upon to begin his case, he expressed concern that the alleged victim of counts one through five who had appeared on behalf of the State would fail to appear for defendant's case with certain records, even though he had been served with two subpoenas. The judge stated that he considered striking the testimony of the witness as presented on the State's case, which would have necessitated dismissal of counts one, two, four and five, but instead the judge declared a mistrial sua sponte.
After the first trial, defendant moved to dismiss the indictment on double jeopardy grounds. The motion was denied by the trial judge on October 5, 1990. In denying the motion, the judge recited his reasons for finding that "manifest necessity" existed for declaration of a mistrial sua sponte. On October 9, 1990, defendant applied to this court for emergent relief from the order denying his motion to dismiss on the grounds of double jeopardy. We denied leave to appeal. Defendant then moved to dismiss counts four and five as barred by the statute of limitations. This motion was denied on December 6, 1990. Defendant again sought leave to appeal which we denied.
Defense also moved to sever counts six through twelve from counts one, two, four, and five, and to sever counts eight and nine from counts six, seven, ten, eleven, and twelve. The motion was denied at the time of commencement of the second trial. Defendant's second trial commenced on February 4 1991. He was convicted by a jury of all eleven counts of the indictment. Defendant filed a motion for a judgment of acquittal after the verdict of guilty and a motion for a new trial, which were denied.
In this appeal defendant raises the following legal arguments:
A. THE OFFENSE CHARGED IN COUNTS FOUR AND FIVE ARE NOT CONTINUING.
B. OFFICERS AND EMPLOYEES OF FINANCIAL INSTITUTIONS VIOLATE N.J.S.A. 2C:20-9, EVEN IF THEY DO NOT DEAL WITH ANOTHER'S PROPERTY AS THEIR OWN.
C. IF A SHOWING OF BENEFIT IS NOT REQUIRED TO VIOLATE N.J.S.A. 2C:21-5 THEN COUNT FIVE IS BARRED BY THE STATUTE OF LIMITATIONS.
POINT X: PAROLE INELIGIBILITY TERMS CANNOT BE ATTACHED AS A MATTER OF COURSE.
The facts reflect that in 1983, defendant was hired by an insurance agency in Glen Rock as an agent. In the spring of 1984, it was decided that the defendant would establish a plan to sell 401k retirement plans. Defendant supervised other agents and conducted seminars involved with the 401k plans. He was introduced at these seminars as the president of Pension Employee Benefit, Inc., a consulting firm that defendant had started. The new firm shared offices with the insurance agency, but had no other connections to the parent insurance company.
Several checking accounts were established for the new firm, all of which were associated with defendant in some way. A checking account of the agency was used to pay the expenses of the 401k program; however, the account was not to be used as a depository for funds provided by clients for investments. Funds received for investments had to be remitted directly to Equitable, the parent insurance company. This requirement was included in defendant's agent-contract and was in the handbook given to all agents by the insurance company.
The defendant and his wife were responsible for managing the agency's 401k expense checking account. Both were authorized to write checks from the account and both maintained the receipts and disbursements account journal for the 401k program. This account was established for the specific purpose of paying the expenses involved with the 401k program. Defendant and his wife received a salary or a draw against future commissions from this account. The 401k program incurred substantial expenses at the beginning of the operation.
Edward Karalanian, the alleged victim of counts one, two, four, and five, manufactured jewelry in New York City. He first consulted with the defendant in November 1983 about establishing a pension plan. Karalanian had $75,000 invested with Merrill Lynch. Defendant took the steps necessary to establish a defined benefit plan for Karalanian. Eventually, a check was sent from Merrill Lynch to the insurance agency in the amount of $42,554.20. On August 13, 1984, defendant endorsed the check and deposited it into his personal account at Valley National Bank. Defendant sent a letter to Merrill Lynch confirming that the amount transferred had "opened a Defined Benefit Keough Plan with the Equitable Life." On September 14, 1984, defendant wrote to Karalanian confirming that Merrill Lynch had transferred the funds. Karalanian testified that he never signed a contract with the defendant and, despite requests, never received any account statements for the defined benefit plan.
Karalanian also had money invested with Charter Security Life Insurance Company (Charter) for his son's education. Defendant advised Karalanian that Charter was experiencing financial difficulties and convinced him to deposit that money with the Equitable. Two checks were issued by Charter on August 13, 1984 in the total amount of $23,850.70. Karalanian and defendant endorsed the checks, which defendant deposited into his personal bank account on September 12 and 14, 1984.
On December 26, 1984, defendant sent a letter to Karalanian stating that $22,633 was deposited with the Equitable to establish a Life Variable Account for Karalanian's son. Karalanian testified that he never received any documentation of this account. In February 1985, Karalanian instructed defendant to terminate the above account and return the money to him. It was refunded in three increments: (1) $7,500 on November 19, 1985, (2) $7,500 on November 27, 1985, and (3) $15,000 on December 4, 1985. Karalanian also testified that in 1986, he and his attorney confronted defendant about the money that was supposed to be invested in the defined benefit plan. Karalanian eventually received a check for the money he had invested plus interest.
The second set of transactions...
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