State v. Newman

• Decision Date: 12 May 1993
• Parties: STATE of New Jersey, Plaintiff-Respondent, v. James A. NEWMAN, Jr., Defendant-Appellant.
• Court: New Jersey Supreme Court

Page 159

132 N.J. 159

623 A.2d 1355

STATE of New Jersey, Plaintiff-Respondent, v. James A. NEWMAN, Jr., Defendant-Appellant.

Supreme Court of New Jersey.

Argued Oct. 27, 1992.

Decided May 12, 1993.

Claudia Van Wyk, Deputy Public Defender II, for defendant-appellant (Zulima V. Farber, Public Defender, attorney).

Henry L. Warner, Asst. Prosecutor, for plaintiff-respondent (Jeffrey S. Blitz, Atlantic County Prosecutor, attorney).

Teresa A. Blair, Deputy Atty. Gen., for amicus curiae, Atty. Gen. (Robert J. Del Tufo, Atty. Gen., attorney).

The opinion of the Court was delivered by

STEIN, J.

This appeal concerns the validity of a sentence of restitution imposed to recover "drug buy money" that defendant had received from an undercover investigator. We also address the adequacy of the inquiry conducted by the sentencing court in setting the amount of restitution and in determining defendant's ability to pay.

I

In February 1991, an Atlantic County Grand Jury returned a seventeen-count indictment against defendant, charging him with offenses stemming from cocaine sales to undercover investigators of the Atlantic County Prosecutor's Office on September 7, 13, and 18, and October 9, 1990. An officer arrested defendant during the October 9 transaction before any money had been exchanged.

Defendant pleaded guilty to one count of the indictment, alleging distribution on September 18 of more than one-half ounce but less than five ounces of cocaine, a second-degree offense. In return, the prosecutor agreed to dismiss the remaining counts. The agreement contemplated that the prosecutor would recommend "ten years prison, no minimum eligibility [and] restitution." Defendant acknowledged on the plea form that he "may be ordered to pay restitution."

At the plea hearing, the court acknowledged the recommended sentence and informed defendant of the maximum penalties to which he could be subjected, including a $100,000 fine. Defendant admitted that he had distributed cocaine on September 18 to an undercover investigator in return for money. He did not refer to any of the other transactions. Neither defendant nor the prosecutor disclosed the amount of money defendant had received from the sales of cocaine. Satisfied that defendant's recitation provided an adequate factual basis, the court accepted the plea.

At sentencing, the prosecutor emphasized that defendant had been motivated by profit, noting that "because restitution is one aspect of the plea agreement and just adding up the figures, Judge, the restitution comes to $5,525.00. That's undercover buy money that was given to Mr. Newman for the purchase of the quantities--rather large quantities of cocaine in question." The prosecutor did not itemize the components of the proposed amount of restitution, but a breakdown appeared in the presentence investigation report: on September 18, defendant sold 53.3 grams of cocaine and received $2,800; on September 7, he sold 13.8 grams for $1,125; and on September 13, he sold 28.5 grams for $1,600. Defense counsel had reviewed the report, and had not contested its description of the transactions. Nor did he object when the court imposed the sentence and included an order for restitution of $5,525.00. The court also imposed "[a] $30.00 VCCB penalty, * * * a DEDR penalty of $2,000.00, a forensic laboratory fee [of] $50.00, [and] a driver's license suspension of six months."

Defendant appealed on the excessive-sentence calendar, arguing primarily that the court had failed to evaluate properly his ability to pay the restitution. The Appellate Division affirmed the sentence. Defendant petitioned for certification, arguing that restitution of drug-buy money is an unavailable sentencing alternative because the County Prosecutor's Office was not a "victim" who had suffered a "loss," and that the buy money constituted an unrecoverable cost of prosecution. Defendant also claimed that the court should not have determined prospectively his ability to pay because the restitution had been imposed in conjunction with a lengthy prison term. Finally, defendant asserted that the court had failed to evaluate adequately his ability to pay. We granted certification, 130 N.J. 6, 611 A.2d 646 (1992).

II

A.

A sentencing court may impose only those sentences authorized by statute. N.J.S.A. 2C:43-2a. When sentencing a defendant to a term of imprisonment, a court may also require the payment of a fine or restitution. N.J.S.A. 2C:43-2b(4). The court's discretion, however, is limited by N.J.S.A. 2C:44-2a, which at the time of defendant's sentencing ¹ provided:

The court may sentence a defendant to pay a fine or make restitution, or both, in addition to a sentence of imprisonment or probation if: (1) the defendant has derived a pecuniary gain from the offense; or (2) the court is of opinion [sic] that a fine or restitution, or both, is specially adapted to deterrence of the type of offense involved or to the correction of the offender.

The statute does not differentiate between fines and restitution, nor does it define those situations in which one or the other would be appropriate. An understanding of the historical distinction between fines and restitution will assist in clarifying the statute's intended application.

Restitution generally is understood to be a form of sanction by which a wrongdoer would compensate the victim for any losses caused by the wrongdoer's conduct. Richard E. Laster Criminal Restitution: A Survey of Its Past History and an Analysis of Its Present Usefulness, 5 U.Rich.L.Rev. 71, 71-75 (1970). Centuries ago, restitution had been an integral element of criminal law, which was then concerned primarily with the compensation of victims. Stephen Schafer, Compensation and Restitution to Victims of Crime 5 (2d ed. 1970). Gradually, the significance of victim compensation diminished as a goal of the criminal law and became instead a principal focus of the civil law. Laster, supra, 5 U.Rich.L.Rev. at 74.

The criminal law's reduced concern for the compensation of victims resulted from the State's increased assertion of authority over criminal misconduct. Id. at 76. As its authority increased, the State began to appropriate part of the victim's restitutionary payment, ultimately demanding it entirely. Id. at 75-80. Attempting to justify its usurpation of restitution, the State redirected the focus of criminal prosecutions from harm to victims to harm against society, explaining its appropriation of payments from the criminal as a means of punishing and deterring the wrongdoer. Id. at 77-80. See generally Jerome Hall, Interrelations of Criminal Law and Torts: II, 43 Colum.L.Rev. 967, 967-79 (1943) (discussing difference between crimes and torts in terms of harm caused); Kenneth Mann, Punitive Civil Sanctions: The Middleground Between Criminal and Civil Law, 101 Yale L.J. 1795, 1807-09 (1992) (describing purposes of criminal versus civil law). That payment was called a "fine," which came to be "understood to mean a payment to a sovereign as punishment for some offense." Browning-Ferris Indus. v. Kelco Disposal, Inc., 492 U.S. 257, 265, 109 S.Ct. 2909, 2915, 106 L.Ed.2d 219, 232 (1989) (discussing applicability of Excessive Fines Clause of the Eighth Amendment to the United States Constitution to civil punitive damages).

Our statutory and case law reflect the historical distinction between fines and restitution. Prior to the adoption of the Code of Criminal Justice (the Code), restitution could be imposed only as a condition of probation. The probationer could be required to "make reparation or restitution to the aggrieved parties for the damage or loss caused by his offense." N.J.S.A. 2A:168-2 (repealed by L. 1978, c. 95). Cases implicating restitution as a condition of probation involved offenders who had damaged or obtained wrongfully another's property. See State v. Bausch, 83 N.J. 425, 416 A.2d 833 (1980) (embezzlement); State v. Harris, 70 N.J. 586, 362 A.2d 32 (1976) (welfare fraud); In re D.G.W. 70 N.J. 488, 361 A.2d 513 (1976) (theft and destruction of property); State v. Varlese, 171 N.J.Super. 347, 409 A.2d 285 (App.Div.1979) (obtaining money under false pretenses), certif. denied, 82 N.J. 298, 412 A.2d 804 (1980); State v. Blassingale, 163 N.J.Super. 110, 394 A.2d 362 (App.Div.) (welfare fraud), certif. granted, 79 N.J. 464, 401 A.2d 221 (1978), certif. dismissed, 81 N.J. 48, 404 A.2d 1148 (1979). In comparison, fines were authorized in all cases, see N.J.S.A. 2A:85-6 & -7 (repealed by L. 1978, c. 95), and were imposed by the court to punish, correct, and deter the offender, as well as to deter others. State v. Lavelle, 54 N.J. 315, 326, 255 A.2d 223 (1969) (Weintraub, C.J., concurring).

The provisions of the Model Penal Code (MPC) dealing with fines and restitution, on which N.J.S.A. 2C:44-2 and other relevant provisions of the Code were based, did not focus as much on the intended recipient of restitution as they did on the penological objective to be furthered by its imposition. The MPC authorized restitution as a condition of probation only, Model Penal Code § 301.1(2)(h) (1985), reflecting the view that the rehabilitative purposes of probation were enhanced by the rehabilitative value of a requirement that the defendant pay restitution to the victim. Model Penal Code § 301.1, cmt. 7 (Tent. Draft No. 2, 1954). By prohibiting the imposition of a fine if it would "prevent the defendant from making restitution or reparation to the victim of the crime," id. at § 7.02(3)(b), the MPC also furthered criminal restitution's historic goal of compensating the victim.

The MPC drafters preserved the fine as an available sanction, acknowledging its effectiveness in preventing future social harm. See Model Penal Code, supra, Introduction to Articles 6 and 7, at 2. To avoid its routine use and increase its deterrent effect, the MPC prohibited the imposition of a fine unless the defendant had derived a pecuniary gain,...