State v. Stewart

• Decision Date: 17 April 2007
• Docket Number: No. 2005–493.,2005–493.
• Citation: 921 A.2d 933,155 N.H. 212
• Court: New Hampshire Supreme Court
• Parties: The STATE of New Hampshire v. John Reed STEWART d/b/a J.R.S. Interiors.

155 N.H. 212

921 A.2d 933

The STATE of New Hampshire

v.John Reed STEWART d/b/a J.R.S. Interiors.

No. 2005–493.

Supreme Court of New Hampshire.

Argued: Nov. 8, 2006.

Opinion Issued: April 17, 2007.

Kelly A. Ayotte, attorney general (Nicholas Cort, assistant attorney general, on the brief and orally), for the State.

Theodore Lothstein, assistant appellate defender, of Concord, on the brief and orally, for the defendant.

HICKS, J.

The defendant, John Reed Stewart d/b/a J.R.S. Interiors, appeals his conviction, following a jury trial in Superior Court (Nadeau, J.), on a felony count of issuing a bad check. See RSA 638:4, I, IV(a)(1) (1996). We reverse and remand.

The jury could have found the following facts. In October 2001, the defendant hired Auger Building Company to complete an extensive renovation of his house, for a total cost of around one million dollars. The contract called for certain payments to be made as certain portions of the job were finished. In November 2002, the defendant executed and delivered to Ben Auger, the owner of Auger Building Company, two checks in the amount of $25,000 each. One check was dated November 14, 2002, and the other was dated November 20, 2002.

Auger did not deposit the checks immediately, although that was not his usual practice. Rather, he waited because the defendant informed him at the time the checks were delivered that there were insufficient funds in the account to cash them right away. Auger testified that the checks "or at least one of them was given to us and [the defendant] said, you know, it will be good next week or something like that." He also testified that he contacted the defendant ten or twelve times regarding the checks and was told at least once by the defendant that "they'll be good; I'm waiting for a transfer."

Auger finally deposited the checks on March 5, 2003. The checks were returned, as there were insufficient funds in the defendant's bank account. The testimony at trial also demonstrated that there were insufficient funds in the account at the time the checks were written.

The defendant testified to the following: He wrote the checks on November 13 or 14 because he was leaving the country. He told Auger that the " checks would be good after a mortgage had gone through while [he] was going to be away." He had hired an attorney, who held a power of attorney, to represent him at the closing, and the proceeds of the mortgage loan were to be deposited into the account on which the checks had been written. According to the defendant, the mutual understanding of all involved was that the attorney would call the defendant's assistant, who would then call Auger to "let him know when he could cash the checks."

The defendant further testified that while he was away, he learned that his financing had fallen through. Upon his return, he informed Auger that he would apply for another mortgage "and that [he] would like the checks back because they were no good." According to the defendant, Auger said he would keep the checks. The defendant testified that he did apply for other funding, but was denied.

The jury returned a verdict of not guilty with respect to the check dated November 20, but guilty with respect to the check dated November 14. The defendant appeals, arguing that the trial court erred in responding to a jury question and in denying his motion to dismiss for insufficient evidence.

The defendant first argues that the trial court misstated the law in response to a jury question. "The response to a jury question is left to the sound discretion of the trial court." State v. Poole, 150 N.H. 299, 301, 837 A.2d 307 (2003) (quotation omitted). Accordingly, we review the court's response under the unsustainable exercise of discretion standard. See id. "We review the trial court's answer to a jury inquiry in the context of the court's entire charge to determine whether the answer accurately conveys the law on the question and whether the charge as a whole fairly covered the issues and law in the case." State v. Fitanides, 141 N.H. 352, 354, 683 A.2d 534 (1996) (citation omitted).

The trial court instructed the jury on the elements of the crime as follows:

[T]he State must prove the following beyond a reasonable doubt. Number one, that the defendant issued a check for the payment of money. Number two, that the payment was refused by the bank on which the check was drawn. Number three, that the defendant knew or believed that the check would not be paid by the bank. Number four, that the face amount of the check exceeded $1,000.00. And number five, that the defendant acted knowingly.

On the first day of deliberations, the jury asked the following questions:

(1) is the verbal agreement between defendant + plaintiff legal + binding

(2) Clarify "at that time"—what period of time? That moment the check was written?

(3) please define criminal intent

The court answered that the first question was not relevant and thus could not be answered. With respect to the second and third questions, the court referred the jury to the original instructions, but in addition, in response to the second question, stated: "The State must prove that, at the time the defendant issued the check, he knew or believed that the check would not be paid by the bank and that there were insufficient funds to cover the check."

The jury asked for further clarification:

Does this statement mean that [the defendant] believed on November 14th that the check would not be paid by the bank. (Eventually, possibly after his refinance)

-or-

That [the defendant] believed that the check would not be paid by the bank on November 14th when he knew the funds were not in the account.

The trial court gave the following answer:

The State does not have the burden to prove the defendant never intended to pay the amount owed.

Rather, the State has the burden to prove beyond a reasonable doubt that at the time the defendant issued the check to Mr. Auger, the defendant knew there were insufficient funds to cover the check, and that the bank would not honor the check.

The defendant contends, "The jury's questions revealed it was grappling with the very heart of the matter"; particularly, "whether [the defendant's] knowledge that the funds were insufficient on the day that he actually wrote the check made him guilty regardless of his good faith belief that Auger would hold the check until the mortgage refinance went through." He argues that "the trial court erred in directing the jury to consider [his] belief as to his account balance on the date of the check." We agree.

The bad check statute provides, in part:

I. A person is guilty of issuing a bad check if he issues or passes a check for the payment of money and payment is refused by the drawee, except in cases where a legal stop payment order has been issued or where the drawee refuses payment for any other reason through no fault of the person who issued or passed the check.

RSA 638:4, I. The prosecutor is required to "prove that the person issued or passed the check knowing or believing that the check would not be paid by the drawee." RSA 638:4, IV(b). The plain language of this subsection focuses on the defendant's belief as to the eventuality of the check being honored, not on the defendant's knowledge of his account balance at the time of writing the check. We therefore conclude that knowledge of insufficient funds at the time of issue is neither a legal presumption, cf. RSA 638:4, II (person is presumed to know check would not be paid if he had no account with drawee at time of issue), nor an element of the crime.

The State argues that this interpretation of RSA 638:4 runs contrary to our holding in Fitanides. We disagree. Fitanides involved a question from a jury in a bad check case as to whether they "could consider the defendant's intent ever to pay [the payee of the check] the amount owed." Fitanides, 141 N.H. at 354, 683 A.2d 534.

We affirmed the trial court's answer to the jury in the negative, stating:

The culpable mental state that the State is required to prove is that the defendant "passed the check knowing or believing that the check would not be paid by the drawee [bank]." RSA 638:4, IV(b). The State need not prove that the defendant never intended to pay the amount owed.

Id.

Fitanides clarifies that the defendant's intent ever to make good on the check, or ever to pay the underlying obligation, are not relevant issues under RSA 638:4. Rather, it is the defendant's knowledge or belief as to whether the check will clear at the time it is presented to the bank by the payee that constitutes the mental state of the crime. A person may know or believe that a check will not clear at the time it will likely be presented to the bank by the payee, yet have every intention of paying the underlying obligation when or if the person has the means to do so. Under RSA 638:4, that person has committed the crime of issuing a bad check despite his good intentions.

Accordingly, the first portion of the trial court's answer, that "[t]he State does not have the burden to prove the defendant never intended to pay the amount owed," was correct, and our decision today is not inconsistent with Fitanides. The second portion, however, added an element to the crime that does not exist, and in so doing, may have misled the jury. The court stated that the State had to prove that "at the time [he] issued the check to Mr. Auger, [he] knew there were insufficient funds to cover the check." As explained above, that is not an element under RSA 638:4. Although the final portion of the answer referred to the correct object of the defendant's knowledge or belief, namely "that the bank would not honor the check," we conclude that by erroneously informing the jury that the defendant's knowledge of an insufficient account balance on the date the check was issued was a necessary element of the crime, the court's answer could have misled the jury into thinking such knowledge was sufficient to meet the mens rea...