State v. Parris

• Decision Date: 10 March 2003
• Docket Number: No. 3607.,3607.
• Citation: 578 S.E.2d 736,353 S.C. 582
• Court: South Carolina Court of Appeals
• Parties: The STATE, Respondent, v. Marion L. PARRIS, Appellant.

353 S.C. 582

578 S.E.2d 736

The STATE, Respondent, v. Marion L. PARRIS, Appellant.

No. 3607.

Court of Appeals of South Carolina.

Heard November 11, 2002.

Decided March 10, 2003.

Rehearing Denied April 18, 2003.

Assistant Appellate Defender Robert M. Dudek, of Columbia, for Appellant.

Attorney General Henry Dargan McMaster, Chief Deputy Attorney General John W. McIntosh, Assistant Deputy Attorney General Charles H. Richardson, and Assistant Attorney General W. Rutledge Martin, all of Columbia; and Solicitor Harold W. Gowdy, III, of Spartanburg, for Respondent.

SHULER, J.:

Marion L. Parris appeals his conviction for breach of trust with fraudulent intent, arguing the trial court erred in failing to grant his motion for a directed verdict. We agree and reverse.

FACTS/PROCEDURAL HISTORY

Marion Parris owned and operated Parris Home Sales (PHS), a mobile home dealership in Gaffney. PHS had a financing arrangement with First National Bank which included a $750,000 "floor plan" line of credit for the pre-approved purchase of mobile homes. As security, First National had a blanket lien over all PHS business assets. In addition, although titles¹ to the mobile homes in the company's inventory originated in PHS, First National maintained physical possession of all titles until each unit was sold. Upon receipt of payment for its interest, First National transferred possession of the title to either the buyer, if the transaction was a cash sale, or, as was usually the case, the permanent lender financing the purchase.

On February 3, 1999, PHS executed a note to First National for $37,405 to purchase a new double-wide mobile home. The loan agreement authorized PHS to pay only accrued interest, in monthly installments, until February 5, 2000, at which time the entire principal amount would come due. The agreement further provided, in part, that PHS would be in default if it did or failed to do something causing the bank to believe it would have difficulty collecting the amount owed. In case of default, the agreement outlined four enumerated remedies plus "any remedy ... under state or federal law."

On November 1, 1999, Jerry and Sherry Martin signed a purchase agreement for the mobile home bought by PHS with proceeds from the February 3rd loan. The contract listed a purchase price of $40,340 and stated in pertinent part:

Title to said [mobile home] shall remain in the Seller until the agreed purchase price therefor [sic] is paid in full [] in cash or by the execution of a [] Retail Installment Contract, or a Security Agreement and its acceptance by a financing agency; thereupon title to the within described unit passes to the buyer as of the date of either full cash payment or on the signing of said credit instruments even though the actual physical delivery may not be made until a later date.

The sale was consummated on November 18, 1999, when the Martins' lender, Bank of America, issued two checks totaling $40,340 and jointly payable to Jerry Martin and PHS. Pursuant to the terms of the purchase agreement, title to the mobile home passed to the Martins at this time, albeit subject to First National's outstanding lien. Jerry Martin thereafter endorsed the checks and Marcia Jolly, the bank vice president conducting the loan closing, handed them to Parris. Parris told the Martins to "give him a couple of days and he would have everything done and [they] could be moved in by Thanksgiving," then left the bank. The Martins subsequently accepted delivery and took possession of the mobile home on the day before Thanksgiving.

The next day, November 19, Parris opened a checking account with American Federal Bank and deposited the two checks from Bank of America. Thereafter, he withdrew money and wrote checks on the account to himself, PHS, and various other payees; he also deposited an additional $7,858.29 into the account.

On December 6, Sherry Martin noticed First National's president, Steve Moss, "snooping" around the new mobile home. Moss approached, knocked on the door, and asked Martin for the trailer's serial number. When Martin told Moss the number was none of his business, Moss replied "that he had a right to get the serial number, that he owned the home, and that he could repossess it." Sherry Martin, upset and crying, called her husband and told him what Moss had said.

Jerry Martin immediately drove to First National and discussed the matter with Thomas Hale, the bank's Chief Lending Officer. Hale explained that First National still had the title to the trailer because Parris had not yet paid off the note. When Martin asked if the bank could really take possession of the home, he was told it could and "probably would." Hale then directed Martin to hire a lawyer and go to the police. The Martins did so and the police subsequently arrested and charged Parris with breach of trust with fraudulent intent. Following the arrest, First National accelerated the underlying note and seized PHS's business assets, which it later sold at a discount.

On February 24, 2000, a Cherokee County grand jury indicted Parris for breach of trust with fraudulent intent. Following conviction by a jury on July 25, 2000, the trial court sentenced Parris to ten years imprisonment. This appeal followed.

LAW/ANALYSIS

Standard of Review

In ruling on a motion for directed verdict in a criminal case, a trial court must view the evidence in the light most favorable to the State. See State v. Buckmon, 347 S.C. 316, 555 S.E.2d 402 (2001). In so doing, the court is concerned with the existence of evidence, not its weight. State v. Lollis, 343 S.C. 580, 541 S.E.2d 254 (2001). This Court, in reviewing a refusal to grant the motion, must also view the evidence in a light most favorable to the State. State v. McGowan, 347 S.C. 618, 557 S.E.2d 657 (2001). If the record reveals any direct or substantial circumstantial evidence which reasonably tends to prove guilt, then this Court must find the trial court acted properly in submitting the case to the jury. See Buckmon, 347 S.C. at 321, 555 S.E.2d at 404; Lollis, 343 S.C. at 584, 541 S.E.2d at 256.

On the other hand, if the State fails to present sufficient evidence of the offense, a defendant is entitled to a directed verdict from the court. State v. Walker, 349 S.C. 49, 562 S.E.2d 313 (2002). Hence, "where the facts of the case, even if proved, do not constitute the alleged criminal conduct, a directed verdict must be granted." State v. Jackson, 338 S.C. 565, 569, 527 S.E.2d 367, 369 (Ct.App.2000).

Discussion

Parris argues the trial court erred in failing to direct a verdict because the State failed to prove he committed a breach of trust. We agree.

Although our Legislature has partially codified the offense of breach of trust with fraudulent intent, its elements remain defined by case law. See S.C.Code Ann. § 16-13-230 (Supp.2002). In essence, the crime is "larceny after trust, which includes all of the elements of larceny or in common parlance, stealing, except the unlawful taking in the beginning." State v. Scott, 330 S.C. 125, 130, 497 S.E.2d 735, 738 (1998) (quoting State v. Owings, 205 S.C. 314, 316, 31 S.E.2d 906, 907 (1944)). The fact distinguishing larceny from breach of trust is that possession of the property is gained by unlawful means in larceny while a breach of trust is accomplished by a lawful taking of the property, i.e., through its entrustment to one by another.²See Scott, 330 S.C. at 130,497 S.E.2d at 738.

To sustain a conviction, the State must prove every element of the offense charged. Jackson, 338 S.C. at 569, 527 S.E.2d at 369. In breach of trust cases, the central question is whether the defendant "received the property in trust," which he later violated. Jackson, 338 S.C. at 569, 527 S.E.2d at 369 (quoting State v. Shirer, 20 S.C. 392, 408 (1884)). The State, therefore, is required to establish the existence of a trust relationship, and in the absence thereof the defendant is entitled to a directed verdict of acquittal. Id. at 569-570, 527 S.E.2d at 370; see State v. LeMaster, 231 S.C. 321, 98 S.E.2d 756 (1957).

A trust is an arrangement whereby property is transferred to another with the intent that it be administered by the trustee for the benefit of the transferor or a third party. See Jackson, 338 S.C. at 570, 527 S.E.2d at 370. As such, it is "a fiduciary relationship ... which arises as a result of a manifestation of an intention to create it." Restatement (Second) of Trusts § 2 (1959) (emphasis added). In most instances a trust relationship is created by the express intent to do so, either through words or conduct. Id. at § 24.

The instant indictment for breach of trust alleged Jerry Martin "entrusted" Parris with $40,340, which Parris later appropriated for his own use. The mere assertion of a trust relationship, however, is not proof of its existence—the State must present evidence tending to prove the relationship as an element of the crime. Although the indictment failed to specify the nature of the alleged trust, the State's theory of the case, acknowledged in its brief, was that Martin "entrusted" Parris with the two checks in exchange for clear title to the mobile home.

In support of this theory, the State offered testimony from Jerry Martin that he "expected" Bank of America to get a clear title to the home when Parris received the checks. The State further relied on Sherry Martin's testimony that she "expected" Parris's statement at closing was accurate—that "he would have everything done" in a couple of days so that they could move in by Thanksgiving. According to the State, the Martins' testimony reflects a "common understanding" as to when Parris would deliver the checks to First National. We disagree. In our view, the proffered evidence, ambiguous at best, is insufficient to support a finding of a specific trust agreement. See Jackson, 338 S.C. at 571, 527 S.E.2d at 371 ("Absent the manifest intent to create a trust, there could be no...