PUBLISHED OPINION
Case No.: 95-1975-CR
†††Petition for
review filed.
Complete
Title
of
Case:STATE OF
WISCONSIN,
Plaintiff-Respondent,†††
v.
ROBERT W. SWEAT,
Defendant-Appellant.
Submitted
on Briefs: February 12, 1996
COURT COURT OF
APPEALS OF WISCONSIN
Opinion
Released: April 4, 1996
Opinion
Filed: April
4, 1996
Source
of APPEAL Appeal from a judgment
Full
Name JUDGE COURT: Circuit
Lower
Court. COUNTY: Wood
(If
"Special" JUDGE: John
V. Finn
so
indicate)
JUDGES: Eich, C.J., Gartzke, P.J., and Dykman, J.
Concurred:
Dissented:
Appellant
ATTORNEYSFor the defendant-appellant the
cause was submitted on the brief of Leon S. Schmidt, Jr. of Schmidt,
Grace & Duncan of Wisconsin Rapids.
Respondent
ATTORNEYSFor the plaintiff-respondent the
cause was submitted on the brief of James E. Doyle, attorney general,
and Maureen McGlynn Flanagan, assistant attorney general.
COURT OF
APPEALS DECISION DATED AND
RELEASED April
4, 1996 |
NOTICE |
A party may file with the Supreme Court a petition to review an
adverse decision by the Court of Appeals.
See § 808.10 and Rule
809.62, Stats. |
This opinion is subject to further editing. If published, the official version will appear in the bound
volume of the Official Reports. |
No. 95-1975-CR
STATE OF WISCONSIN IN
COURT OF APPEALS
STATE
OF WISCONSIN,
Plaintiff-Respondent,
v.
ROBERT
W. SWEAT,
Defendant-Appellant.
APPEAL
from a judgment of the circuit court for Wood County: JOHN V. FINN,
Judge. Reversed and cause remanded
with directions.
Before
Eich, C.J., Gartzke, P.J., and Dykman, J.
DYKMAN,
J. Robert W. Sweat appeals from a
judgment ordering him to pay $364,597.23 in restitution to the victims of his
racketeering scheme. Sweat argues
that: (1) he is entitled to offset
payments made to the victims from the total amount of restitution ordered by
the trial court; (2) the victims' claims were discharged in bankruptcy;
and (3) he may assert a civil six-year statute of limitations as a defense
to the victims' claims. Because we
conclude that the trial court erred when it refused to apply the civil six-year
statute of limitations, we reverse the restitution order, remand and direct the
court to hold a hearing taking this defense into consideration. We resolve the remaining issues against
Sweat.
BACKGROUND
Robert
W. Sweat devised an illegal scheme in which he operated as an insurance agent
and induced several individuals to give him money. He promised these individuals that he would invest their money in
exchange for return rates between twelve and fifteen percent. During the 1980's, Sweat collected
$364,597.23 as part of his scheme.
Sweat moved to Texas in spring 1989 and filed a petition in bankruptcy
in July naming the victims as creditors.
In January 1990, the bankruptcy court discharged his debts.
Sweat
was later apprehended and pleaded no contest to one count of racketeering,
contrary to § 946.83(3), Stats. After a restitution hearing, the trial court
ordered Sweat to pay $364,597.23 to the victims. In so doing, it ruled that the payments he had already made to
the victims would not offset the amount that Sweat owed to his victims, that
his 1990 bankruptcy discharge did not discharge these debts, and that a civil
six-year statute of limitations did not apply to bar the victims' claims. Sweat appeals.
OFFSET
Sweat
first argues that the trial court should have offset the restitution order with
amounts he already paid to the victims.
The trial court acknowledged that Sweat had already made payments to the
victims totalling $75,119.54, but it disallowed an offset because "these
were monies the victims were entitled to and would have received if the
defendant had not squandered their investments." Sweat also claims an offset for services he performed for one of
the victims.
The
amount of restitution ordered is committed to the sound discretion of the trial
court. State v. Boffer,
158 Wis.2d 655, 658, 462 N.W.2d 906, 907-08 (Ct. App. 1990). We will affirm that decision if the court
"examined the relevant facts, applied a proper standard of law, and, using
a demonstrated rational process, reached a conclusion that a reasonable judge
could reach." Loy v.
Bunderson, 107 Wis.2d 400, 415, 320 N.W.2d 175, 184 (1982).
We
reject Sweat's claim that the trial court acted unreasonably because there is
no evidence that Sweat ever repaid any of the principal given to him by the
victims. Had Sweat not deceived these
victims, they would have received their principal back plus a large sum of
interest. Thus, we conclude that the
court acted within its discretion when it refused to offset its restitution
order by the amount Sweat already paid.
Sweat
also argues that the restitution order should have been offset for about 600
hours of services he claims he performed for one of the victims. Sweat, however, never billed this victim for
these services when they were provided, never listed them as an asset in his bankruptcy
proceedings, and drafted a bill only after these criminal proceedings
commenced.[1] Because the funds given to Sweat were not
"loans," but money induced as part of a racketeering scheme, the only
"service" Sweat provided to this victim was, as the State suggests,
"the total dissipation of $100,000 of her assets within an eighteen-month
period." Thus, the court's failure
to provide an offset for these alleged services was reasonable and proper.
Sweat
also complains that the State rather than several of the victims presented
proof of their losses during the restitution hearing but that under
§ 973.20(14)(a), Stats.,[2]
the burden rests on the victim, not the prosecutor, to prove the victim's
claims. Section 973.20(14)(a)
provides only that the prosecutor is not required to represent any victim. It does not, however, bar the prosecutor
from appearing at the restitution hearing and gives the prosecutor the
discretion as to whether he or she will represent the victim in securing a
restitution order. Moreover, despite
Sweat's hearsay objections, the trial court correctly relied upon the
investigator's testimony as to the amounts claimed by the victims because the
rules of evidence do not apply to restitution hearings. State v. Pope, 107 Wis.2d 726,
729, 321 N.W.2d 359, 361 (Ct. App. 1982).
BANKRUPTCY
DISCHARGE
Sweat
next argues that restitution should not have been ordered because a Texas
bankruptcy court discharged the amounts he owed to the victims in January
1990. In State v. Foley,
142 Wis.2d 331, 417 N.W.2d 920 (Ct. App. 1987), however, we relied upon Kelly
v. Robinson, 479 U.S. 36 (1986), and the legislative history of
§ 973.09(1)(b), Stats.,[3]
to hold that a restitution order is unaffected by bankruptcy proceedings. In Foley, the defendant's
debts were discharged in bankruptcy and then he was ordered to repay those
debts in restitution as part of his criminal sentence. Id. at 335, 417 N.W.2d at
922-23. In concluding that the
restitution order was valid, we reasoned that the criminal justice system
focuses on the offender as well as the victim and that ordering the offender to
make restitution to his victim has a rehabilitative effect which is compatible
with the bankruptcy court's "fresh start." Id. at 338, 417 N.W.2d at 924.
Sweat
cites several cases from federal circuit and bankruptcy courts decided in or
before 1986 in support of his position.
However, federal decisions are not binding on state courts in
Wisconsin. Thompson v. Village of
Hales Corners, 115 Wis.2d 289, 307, 340 N.W.2d 704, 712-13 (1983). We are bound only by the United States
Supreme Court on questions of federal law.
State v. Webster, 114 Wis.2d 418, 426 n.4, 338 N.W.2d 474,
478 (1983). Accordingly, we rely on Foley
and Kelly and conclude that the trial court did not err when it
concluded that the restitution order is unaffected by Sweat's bankruptcy proceedings.
STATUTE OF
LIMITATIONS
Finally,
Sweat argues that the trial court erred when it concluded that a civil six-year
statute of limitations was not applicable to this case. Instead, the court applied the criminal
six-year statute of limitations, § 939.74, Stats., and determined that the cause of action was tolled
when Sweat moved to Texas in April 1989.
Thus, the court concluded that the criminal statute of limitations did
not bar a claim for restitution on any transaction occurring after April 1, 1983.
Sweat
asserts, however, that § 973.20(14)(b), Stats.,
provides that a defendant may assert in a restitution hearing any defense that
he or she could have raised in a civil action for the loss sought to be
compensated. He argues that a six-year
statute of limitations to recover damages for the wrongful taking, conversion
or detention of personal property is applicable to this case. Section 893.51, Stats.
To
determine whether Sweat may raise a civil statute of limitation defense in a
restitution hearing, we must construe § 973.20(14)(b), Stats.[4] Statutory construction is a question of law
which we review de novo. Minuteman,
Inc. v. Alexander, 147 Wis.2d 842, 853, 434 N.W.2d 773, 778
(1989). Our primary purpose when
interpreting a statute is to give effect to the legislature's intent. Riverwood Park, Inc. v. Central
Ready-Mixed Concrete, Inc., 195 Wis.2d 821, 827, 536 N.W.2d 722, 724
(Ct. App. 1995). We first examine the
language of the statute and if that language is clear and unambiguous, we apply
its ordinary meaning. Id.
at 828, 536 N.W.2d at 724.
The
relevant portion of § 973.20(14)(b), Stats.,
provides: "The defendant may
assert any defense that he or she could raise in a civil action for the loss
sought to be compensated." The use
of the word "any" is broad, unambiguous and is susceptible to one interpretation
within the meaning of this statute: a
defendant may assert all of the defenses available to a person during a civil
trial in a restitution hearing, including relevant statutes of limitation. We conclude that § 893.51, Stats., is one such statute of
limitations which is relevant to this case.
The
State responds that civil statutes of limitation are not applicable in criminal
cases and that the relevant criminal statute of limitations, § 939.74, Stats., applies. As a general matter, we would agree. But the restitution statute clearly states
that any defense available to a defendant in a civil action may be
asserted in the restitution hearing.
This includes civil statutes of limitation.
Thus,
we reverse the restitution order and remand this matter to the trial court for
a fact-finding hearing on when the victims' causes of actions accrued, taking
into consideration the application of the discovery rule, which applies to
§ 893.51, Stats. See H.A. Freitag & Son,
Inc. v. Bush, 152 Wis.2d 33, 37, 447 N.W.2d 71, 73 (Ct. App.
1989). The trial court should also make
factual findings and determine whether under § 893.19, Stats., and § 801.05, Stats., the causes of actions were
tolled when Sweat moved to Texas.[5]
By
the Court.—Judgment reversed
and cause remanded with directions.
[1] Sweat claims that he did not bill this victim
before the criminal proceedings began because he did not want her to be brought
into the bankruptcy case and held liable to him.
[2] Section 973.20(14)(a), Stats., provides:
The burden of
demonstrating by the preponderance of the evidence the amount of loss sustained
by a victim as a result of the crime is on the victim. The district attorney is not required to
represent any victim unless the hearing is held at or prior to the sentencing
proceeding or the court so orders.
[3] Section 973.09(1)(b), Stats., provides:
If the court places the person on
probation, the court shall order the person to pay restitution under s. 973.20,
unless the court finds there is substantial reason not to order restitution as
a condition of probation. If the court
does not require restitution to be paid to a victim, the court shall state its
reason on the record. If the court does
require restitution, it shall notify the department of justice of its decision
if the victim may be eligible for compensation under ch. 949.
[4] In Olson v. Kaprelian, No.
95-2322, slip op. at 6-7 (Wis. Ct. App. Apr. 10, 1996, ordered published June
25, 1996), we also discussed § 973.20, Stats.,
and restitutionary awards. However, Olson
considers the effect of § 973.20(8) in civil court, while we decide the
effect of § 973.20(14)(b) in criminal court. Therefore, Olson is not relevant to our
discussion.
[5] Under § 893.19(1), Stats., a cause of action against a
person who leaves the State of Wisconsin after a cause of action accrues is
tolled during the period of time that person resides out of this State. But § 893.19(2) provides that tolling does
not apply to persons who, while out of this state, may be subjected to the
personal jurisdiction of the Wisconsin courts under § 801.05, Stats.