State v. Morales

• Decision Date: 19 November 2020
• Docket Number: CC 150034CR (SC S067225)
• Citation: 476 P.3d 954,367 Or. 222
• Parties: STATE of Oregon, Respondent on Review, v. Gerardo MORALES, Petitioner on Review.
• Court: Oregon Supreme Court

367 Or. 222

476 P.3d 954

STATE of Oregon, Respondent on Review,

v.Gerardo MORALES, Petitioner on Review.

CC 150034CR (SC S067225)

Supreme Court of Oregon, En Banc.

Argued and submitted September 23, 2020.

November 19, 2020

Shawn E. Wiley, Deputy Public Defender, Office of Public Defense Services, Salem, argued the cause and filed the briefs for petitioner on review. Also on the briefs was Ernest G. Lannet, Chief Deputy Defender.

Adam Holbrook, Assistant Attorney General, Salem, argued the cause and filed the brief for respondent on review. Also on the brief were Ellen Rosenblum, Attorney General, and Benjamin Gutman, Solicitor General.

BALMER, J.

The issue before the court is whether funds deposited by a third party as security for release of a criminal defendant prior to trial can provide the basis for imposing attorney fees on the defendant, when the defendant does not otherwise have the ability to pay those fees. Here, the trial court found that defendant did not have the ability to pay fees, but it nevertheless ordered payment of fees from security funds deposited by defendant's mother. For the reasons set out below, we hold that, because the trial court determined that defendant did not have the ability to pay, it was error to impose fees on the basis of the third party's security payment alone.

The relevant facts are primarily procedural. Defendant was indicted on various sex crime charges and, after the trial court set bail, defendant's mother paid $20,000 as security for defendant's release prior to trial.¹ The notice defendant's mother signed when depositing the security funds on defendant's behalf stated that "[t]he Court may order that the security deposit be applied to any fines, costs, assessments, restitution, contribution, recoupment, or other monetary obligations that are imposed on the defendant." Defendant was represented by court-appointed counsel at trial, after which the jury found defendant guilty of several sex offenses.

Following those convictions, the state requested that defendant be required to pay attorney fees for his court-appointed counsel. Defendant objected on the ground that the court could not find that he had the ability to pay attorney fees. The state argued that when a third party makes a security deposit on behalf of a criminal defendant—as defendant's mother did here—that third party is informed that fees or fines might be paid out of that deposit. For that reason, the state argued, those funds are available to pay court-ordered fees and the defendant therefore has the "ability to pay" such fees out of the security amount. The court imposed $5,000 in attorney fees and ordered it to be paid out of the money deposited by defendant's mother as security for his pretrial release. The court described its findings as follows:

"THE COURT: * * * I didn't find that [defendant] had the ability to pay [attorney fees]. I found that there was bail sufficient to cover them. And that's the only finding I could reasonably make, and so that's the finding I did make."

Defendant appealed, arguing, inter alia , that the trial court erred in applying the security funds paid by his mother to the attorney fees without determining defendant's ability to pay, as required by statute. The Court of Appeals affirmed without opinion. State v. Morales , 299 Or. App. 521, 449 P.3d 593 (2019). We allowed review to examine whether evidence that a third party paid a security deposit on behalf of a criminal defendant is sufficient on its own to find that that defendant had the ability to pay court-imposed attorney fees.

This question requires us to construe two statutes together— ORS 135.265 and ORS 161.665. When a criminal defendant is not conditionally released or released on personal recognizance, the judge "shall set a security amount that will reasonably assure the defendant's appearance" at future court proceedings in the case. ORS 135.265(1). The next section of the statute reads as follows:

"The defendant shall execute a release agreement and deposit with the clerk of the court before which the proceeding is pending a sum of money equal to 10 percent of the security amount[.] * * * When conditions of the release agreement have been performed and the defendant has been discharged from all obligations in the cause, the clerk of the court shall return to the person shown by the receipt to have made the deposit, unless the court orders otherwise, 85 percent of the sum which has been deposited * * *."

ORS 135.265(2). ORS 135.265(2) thus provides that, upon payment of 10 percent of the security amount and the execution of a release agreement, the defendant is released. After the conditions of the release agreement have been performed and the defendant has been discharged from all obligations in the case, the remainder of the security amount is returned to the person who made the deposit "unless the court orders otherwise." ORS 135.265(2). Practically speaking, then, if the court is authorized to impose fees or costs on a defendant, ORS 135.265(2) allows the court to order that those fees or costs be paid out of the security amount.

The question in this case involves the circumstances in which a court may "order[ ] otherwise," and not return the remaining security funds to the person who made the deposit. As relevant here, following the conviction of a criminal defendant, the court "may include in its sentence there-under a money award for all costs specially incurred by the state in prosecuting the defendant * * * includ[ing] a reasonable attorney fee for counsel appointed" by the court. ORS 161.665(1). ORS 161.665(4) imposes certain requirements before a defendant may be ordered to pay costs:

"The court may not sentence a defendant to pay costs under this section unless the defendant is or may be able to pay them . In determining the amount and method of payment of costs, the court shall take account of the financial resources of the defendant and the nature of the burden that payment of costs will impose."

(Emphases added.)

The Court of Appeals has held that "a trial court errs as a matter of law if it orders a defendant to pay court-appointed attorney fees without making [the] required finding" of the defendant's ability to pay. State v. Mickow , 277 Or. App. 497, 500, 371 P.3d 1275 (2016). The imposition of fees cannot be "based on pure speculation that a defendant has funds to pay the fees or may acquire them in the future," but rather the record must contain "some information from which the court can find the statutorily required factual predicate to imposition of the fees: that the defendant ‘is or may be able to pay’ them." State v. Pendergrapht , 251 Or. App. 630, 634, 284 P.3d 573 (2012).

Thus, before imposing fees, the trial court must complete a two-step process: first, the court must determine if the defendant "is or may be able to pay" the fees, and, second, the court must determine the amount of costs to be repaid. It appears to follow necessarily from the text of the statute that, if a trial court is unable to find that the defendant "is or may be able to pay" the fees—or, to phrase it in the affirmative, if the trial court finds that the defendant does not have the ability to pay—the inquiry ends, and the court may not impose fees in any amount.

The parties here do not dispute that the requirement in ORS 135.265(2) that the security deposit be returned "unless the court orders otherwise" gives a trial court authority to exercise its discretion, subject to other statutory requirements, to apply the funds deposited as security to financial obligations imposed in the judgment—including attorney fees imposed under ORS 161.665. The parties also do not dispute that, prior to the imposition of attorney fees under that section, the trial court is required to determine the defendant's "ability to pay" using the criteria set out in ORS 161.665(4). What the parties do dispute, however, is whether funds deposited by a third party as security for release of a criminal defendant prior to trial can provide the basis for imposing attorney fees on a defendant who does not otherwise have the ability to pay those fees. For assistance answering that question, we turn to the text and history of the relevant statutes.

Both of the statutes at issue here— ORS 135.265 and ORS 161.665 —were based on the work of the 1971 Criminal Law Revision Commission. Oregon law, however, has always permitted courts to require a defendant to deposit security funds and then later to apply the money deposited to costs and fines imposed as part of the judgment:

"When money has been deposited in lieu of bail, if it remain on deposit at the time of a judgment for the payment of money, the clerk must, under the direction of the court, apply the money in satisfaction thereof, and after satisfying the same, must refund the surplus, if any, to the defendant."

General Laws of Oregon, Crim. Code, ch. XXV, § 283, p. 489 (Deady 1845-1864).

Both defendant and the state discuss two cases from the 1920s, where this court interpreted a later version of the statute in the Deady Code and stated that, under the statute, "money deposited by a third person in lieu of bail for one charged with a criminal offense is presumed to belong to the defendant[.]" Rosentreter v. Clackamas County , 127 Or. 531, 534, 273 P. 326 (1928) (citing Erickson v. Marshfield , 94 Or. 705, 710, 186 P. 556 (1920) ). In Erickson , the plaintiff—Erickson—sued the city of Marshfield to recover the $100 bail he had paid on behalf of a criminal defendant, Foote, on a nuisance charge. Id. at 706, 186 P. 556. That nuisance charge was dismissed, but Foote ultimately was convicted of a different charge, for which a $100 fine was imposed.

Id. at 705-06, 186 P. 556. The court noted that, in some states, there is a presumption that money deposited as security belongs to a criminal defendant on whose behalf the money was deposited, and determined that the statute it interpreted—which required...