U.S. v. Noland, 91-1031

• Decision Date: 19 May 1992
• Docket Number: No. 91-1031,91-1031
• Citation: 960 F.2d 1384
• Parties: 35 Fed. R. Evid. Serv. 834 UNITED STATES of America, Appellee, v. Debra NOLAND, Appellant.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 1384

960 F.2d 1384

35 Fed. R. Evid. Serv. 834

UNITED STATES of America, Appellee, v. Debra NOLAND, Appellant.

No. 91-1031.

United States Court of Appeals Eighth Circuit.

Submitted Nov. 15, 1991.

Decided April 6, 1992.

Rehearing Denied May 19, 1992.

Michael Angel, Little Rock, Ark., argued, for appellant.

Michael D. Johnson, Little Rock, Ark., argued (Charles A. Banks and Michael D. Johnson on the brief), for appellee.

Before McMILLIAN and JOHN R. GIBSON, Circuit Judges and HUNTER, ^* Senior District Judge.

ELMO B. HUNTER, Senior District Judge.

This is an appeal from a judgment of conviction following a jury trial. ¹ Jurisdiction in the district court was invoked under 18 U.S.C. §§ 371, 844(h) and 1341. Jurisdiction in this court is invoked under 28 U.S.C. § 1291.

Debra Noland (hereinafter "appellant") was indicted on April 19, 1990, in an eight count indictment charging her with conspiracy to commit arson and mail fraud; arson; and six counts of mail fraud. Trial began on September 25, 1990. The appellant was convicted on all eight counts and sentenced on December 17, 1990, ² to 93 months imprisonment under the sentencing guidelines. Included in her offense level calculation was a two level increase for obstruction of justice. Appellant's brother, Marvin Tucker, was found guilty on all counts while her husband, Diarl Noland, had his motion for acquittal granted after the government rested its case.

STATEMENT OF FACTS

On November 6, 1989, appellant reported to the Pulaski County Sheriff's Office and her insurance company, Farmers' Insurance Group, that her residence had been burglarized. After a short investigation Farmers' paid the appellant for her claim. Included in this amount was money for a specifically scheduled ring. The appellant submitted a 1981 appraisal to establish the existence and value of the ring. At the time of the alleged burglary, the appellant was behind in all of her bills and had little money in her checking account. When the insurance company paid the claim on December 7, 1989, appellant was further behind and overdrawn in her checking account. In the following three weeks, she paid nearly all her outstanding bills, including her utility bills, credit cards, and house payment. The sole source for these expenditures was the insurance money collected on the burglary claim.

During the same period of time, appellant solicited her brother, Marvin Tucker, to intentionally set fire to her residence. His first attempt to do so occurred on Sunday, December 17, 1989, while the appellant, her husband, and her two children visited a relative in Harrison, Arkansas. Appellant and her family had never before nor since visited this relative. The appellant then approached James Tucker, on December 19, 1989, and went to James Tucker's residence with her two children. She left the children at his house and took him in her car offering him $1000 to burn her house. This visit was the only occasion appellant and her children had ever, or have ever, visited James Tucker and his family in their home.

James and Marvin Tucker talked the next two days and agreed together to burn the appellant's residence. They arranged for the burning to occur on December 21, 1989, when the appellant and her family planned to be shopping. This attempt also failed. Appellant returned to James Tucker's residence the next day, Friday, December 22, 1989. No one was home and she left a note for James to phone her. The note was found by Jennifer Tucker when she returned home from school. James Tucker did not respond to the note.

Over the next week, appellant arranged through Marvin Tucker for Marvin and James to try the arson again and increased the amount they were to be paid to $1500 each. Marvin and James agreed to try again and decided to recruit a third person to drive the truck so both of them could enter the residence, where they planned to spread 20 gallons of gasoline. On December 31, 1989, James Tucker spread gasoline at the house and set fire to the residence while appellant and her family were away from home. On January 1, 1990, appellant paid the $1500 and began the insurance claim that comprises the object of the conspiracy and mail fraud counts of the indictment. Her claim was for more than $205,000 approximately $111,000 of which was for the alleged contents of the house.

The government also elicited testimony involving the series of insurance claims that appellant had filed over the years. The government presented evidence pertaining to a 1982 insurance claim of a ring lost by appellant at a Wal-Mart; a 1983 burglary in which appellant made an insurance claim during the pendency of personal bankruptcy and a November 1989 burglary that resulted in an insurance claim. Several witnesses testified to appellant's financial health, citing this as relevant to show a motive to commit arson. In essence, the government's case centered on the testimony of James Tucker, an accomplice, and a myriad of Federal Rule of Evidence 404(b) evidence, which was admitted over the objection of appellant's trial counsel.

I.

Appellant asserts that the trial court erred in admitting any evidence pertaining to the ring being lost and claimed on the 1982 insurance form and being stolen and claimed on the 1989 insurance form. In her insurance claim for the November 1989 burglary, appellant included a ring valued at $3395. Because of the value of the ring, it had to be separately scheduled on the insurance policy and proof of its value had to be provided to the insurance company. This was accomplished by providing the insurance company with the 1981 appraisal for the ring, which was the same appraisal submitted to substantiate ownership for the 1982 reported loss.

On this appeal, appellant presents two grounds for reversal. The first ground concerns the 1989 insurance claim for the ring made by appellant after the 1989 burglary. Evidence was presented that the 1989 burglary was a sham to defraud the insurance company, in order that the appellant might pay her existing bills. The government contends that the evidence was part of the conspiratorial scheme charged. Appellant argues that the evidence surrounding the burglary was sufficient to convey to the jury the government's contention that the insurance claim was fraudulent, and evidence of the actual insurance claim for the ring was cumulative and highly prejudicial.

Appellant argues that the specific evidence, i.e., evidence of the ring, is so prejudicial that it should not have been permitted. Fed.R.Evid. 403 states that evidence, although relevant, may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice. Merely because evidence is prejudicial, does not mean that the evidence must be excluded. In fact, no verdict could be obtained without prejudicial evidence. "Rule 403 requires the district court to weigh the probative value of evidence against the effect of its non-probative aspect--and to assess the danger that admission of the evidence will unfairly prejudice the appellant. When the effect on the jury of the 'non-probative aspect of the evidence is likely to be substantially greater than the effect of the probative aspect, the evidence should be excluded.' " United States v. Bailleaux, 685 F.2d 1105, 1111 (9th Cir.1982) (emphasis in original). Bailleaux concludes that with the greater degree of probativeness possessed by the evidence, the greater the showing of unfair prejudice that will be required to exclude the evidence. Id. Here the evidence is prejudicial and is probative as to appellant's intent and motivation to defraud the insurer. Appellant concedes that the evidence was admissible against her under the intent, plan and preparation portion of Rule 404(b). However, the evidence is not unfairly prejudicial. "While Rule 403 protects against evidence that is unfairly prejudicial in that it tends to suggest decision on an improper basis, the rule does not protect against evidence that is prejudicial merely in the sense that it is detrimental to a party's case." United States v. Michaels, 726 F.2d 1307, 1315 (8th Cir.1984), cert. denied, 469 U.S. 820, 105 S.Ct. 92, 83 L.Ed.2d 38 (1984). The District Court was not in error in exercising its discretion in finding that the probative value of the evidence was not substantially outweighed by the danger of its unfair prejudicial effects. See U.S. v. Zimmerman, 832 F.2d 454, 458 (8th Cir.1987).

Appellant's second ground is that evidence regarding the 1982 insurance claim for the ring should have been excluded. At trial, the government contended that the evidence concerning the 1982 claim was offered to cast doubt upon the legitimacy of the 1989 claim, with the premise being that the 1982 claim was legitimate and the ring was lost. Appellant argues that a reasonable juror would infer that if evidence established that the 1989 claim was fraudulent, then the 1982 claim was also fraudulent. As evidence in support of this assertion, appellant cites the government's cross-examination of appellant, where appellant was questioned about the number of insurance claims filed by her over the years including the 1982 insurance claim. Appellant infers that the jury would question the legitimacy of the 1982 claim and would therefore consider this as evidence of appellant's bad character under Fed.R.Evid. 404(b). Appellant concludes that the probative value of this evidence was outweighed by the unfair prejudice of admission.

In essence, appellant asserts that the evidence of the 1982 claim for the lost ring implicates the appellant in a prior bad act. Fed.R.Evid. 404(b) is inapposite. The proper standard of review is abuse of discretion. See United States v. Bernal, 719 F.2d 1475, 1478 (9th Cir.1983). Appellant conjures the scenario that the jury speculated the 1982 claim was fraudulent inasmuch as a reasonable juror would infer that because the government showed that the 1989 claim...