Grey v. Allstate Insurance

WILNER, Judge. On the evening of September 11, 1997, Jumanne Smith, while intoxicated, was driving his Jeep Cherokee in the wrong direction on a highway ramp at a high rate of speed, when he collided with another vehicle occupied by Bobbett Grey, her mother, Delores Grey, and her nephew, Jordan Ashley. Delores was killed; Bobbett and Jordan were seriously injured. As a result of the incident, Smith was charged with a number of criminal offenses.

In October, 1998, he entered into a plea agreement with the State, pursuant to which he pled guilty to manslaughter by automobile (Maryland Code, Article 27, § 388) and agreed to pay an aggregate of $85,000 in restitution — $40,000 to Bobbett, $25,000 to Jordan, and $20,000 to Delores’s estate. Neither the text of the plea agreement nor information regarding whether any other punishment was imposed appears in the record before us. ⁴⁴⁹ In accordance with the plea agreement, the court, on January 7, 1999, entered an Order of Restitution. In that order, the court found that Bobbett, Jordan, and Delores’s estate, appellants here, were entitled to restitution under Maryland Code, Article 27, § 807, and it ordered restitution in the amounts noted, with $15,000 of the $40,000 payable to Bobbett to be paid immediately. The court also ordered the clerk to record and index the order of restitution as a money judgment.

That, apparently, was done. Smith paid the $15,000 as directed. Through wage garnishments, appellants have collected an additional $4,614. At some point, appellants filed a civil action against Smith in the Circuit Court for Howard County.

The pleadings in that case are not in the record before us; we are informed only that the case has yet to be tried and is still pending. At the time of the accident, Smith had in effect an automobile liability insurance policy issued by appellee, Allstate Insurance Company, with policy limits for personal injury of $20,000 per person and $40,000 aggregate and $10,000 for property damage. The case now before us arises from appellants’ attempt to attach the proceeds of the insurance policy in partial satisfaction of the restitution order. Shortly after entry of that order, appellants filed in the Circuit Court for Howard County writs of garnishment against Allstate, directing it to “hold the property of [Smith] subject to further proceedings.” Allstate responded that it was not in possession of any property of Smith and was not currently indebted to Smith.

Through a reply to that answer, appellants averred that the restitution judgment was “for compensatory damages arising out of the negligent operation of a motor vehicle,” that Smith was insured by Allstate, that it therefore had a contractual obligation to pay Smith the judgment for compensatory damages, and that that obligation constituted “property, money or credit of the Judgment Debt- or which is subject to garnishment.” With the issue thus joined, both sides filed motions for summary judgment. In February, 2000, the court denied appellants’ motions, granted that of Allstate, and entered judgment in favor of Allstate. ⁴⁵⁰ Appellants appealed, and we granted certiorari, on our own initiative, before decision by the Court of Special Appeals, to determine whether a garnishment action by appellants lies against Allstate under the circumstances of this case. DISCUSSION The law governing the ordering of restitution in a criminal case is set forth in Article 27, § 807. That section is a long and detailed one and is not free from some ambiguity with respect to the issue before us. 1 Appellants look, in particular, to subsections (f) and (g) of the statute.

The latter requires, in relevant part, that a judgment of restitution entered by a circuit court be recorded and indexed in the civil judgment index as a money judgment. Subsection (f) provides that, when the judgment is so recorded and indexed, it constitutes a money judgment in favor of the individual and may be enforced by the individual in the same manner as a money judgment in a civil action. Thus, appellants argue, when the order of restitution in this case was docketed as a money judgment on January 21,1999, it became no different than any other money judgment so recorded. It established an amount that Smith was legally obligated to pay and, accordingly, triggered Allstate’s contractual obligation to pay that amount to Smith.

That obligation, they urge, became property of Smith in the hands of Allstate and was therefore subject to garnishment. Allstate, of course, has a different view. It notes, first, that, by filing the separate civil action, in which damages far exceeding $85,000 are sought, appellants have recognized that the order of restitution is not a “bonafide civil judgment” against Smith. Additionally, it argues that, if the order of restitution really carried the same weight as a normal civil judgment, Smith would be denied his right of civil jury trial on the issues of liability and damages and Allstate would be ⁴⁵¹ denied its right to compromise and settle the case.

Finally, it contends that appellants have no standing, in any event, to garnish the policy proceeds, as Smith, himself, presently has no right to sue on the policy. For the reasons to be explained, we agree with the ultimate position of Allstate. Appellants’ argument, focused, as we have said, on § 807(f) and (g), overlooks other provisions of § 807 that must be read together with subsections (f) and (g) in the context of the overall purpose of restitution, and overlooks as well the nature of the restitution judgment and of Allstate’s rights and obligations under its policy. It is important, in any analysis of § 807, to keep in mind that restitution under that statute is a criminal sanction, not a civil remedy.

That is clear from both the statute itself and from the more recent historical development of restitution generally. The order of restitution, even when entered as a civil judgment, concludes only the matters that were raised or that could have been raised, in the criminal proceeding. Although it may be enforced in the manner that a civil judgment may be enforced, it does not, and cannot, establish civil liability for anything beyond the matters it concludes. Restitution as a means of penance for criminal behavior has its roots in ancient societies.

Stephen Schafer writes that “[t]he basis of primitive and early Western law was personal reparation by the offender or the offender’s family to the victim.” Stephen Schafer, The Victim and His Criminal 8 (1968). 2 Provisions for restitution appear in the earliest re ⁴⁵² corded codes. 3 In the Code of Hammurabi, written about 1800 B.C., and in the Book of Exodus, recording events 600 years later, are requirements for restitution for what we now regard as criminal conduct, mixed among the capital and corporal penalties. 4 Schafer notes that, in some ancient societies, “[f]or injuries both to person and property, restitution or reparation in some form was the chief and often the only element of punishment.” Id. at 12. Through these various codes, restitution was offered as the more civilized alternative to private retribution. The State, as such, had not yet arrogated to itself the role of punishing conduct that injured only other individuals and not the community as a whole, and the “payback” for such injurious conduct was private retribution, either by the injured person or his or her family or clan — the “blood feud.” Through restitution, the offender could avoid retribution to himself or his family by providing compensation to the victim or the victim’s family. In the Twelve Tables, for example — the earliest codification of Roman law (c. 450 B.C.) — it is provided that, ⁴⁵³ “[i]f one has maimed a limb and does not compromise with the injured person, let there be retaliation.” Table VIII.

The requirement of restitution for injuries to both property and person continued into later Roman times under the Lex Aquilia and through the time of Justinian in the Sixth Century. See The Institutes of Justinian, Book IV, Title III, J.B. Moyle (5th ed.1913). It carried over as well into Anglo Saxon England. One of the earliest surviving documents written in the English language, the Dooms (Laws) of Aethelberht, King of Kent from 560-616 A.D., deals almost entirely with the monetary compensation to be paid for various offenses, as do the Dooms of Kings Hlothhaere and Eadric (673 686) and the Dooms of King Alfred (871-901).

Medieval Sourcebook: The Anglo-Saxon Dooms, 560-975, http:/Avww.fordham.edu/hal-sall/source/560-975dooms.html. Schafer notes that, by the time of Alfred, “the feud was resorted to only after compensation had been requested and refused.” Schafer, supra, at 16. Until the late Middle Ages, there was no clear distinction between criminal and civil law, and the restitution provided for in the various codes was regarded more as recompense for the damage or injury inflicted on the victim than as punishment for an offense against the State or the Sovereign. In England and elsewhere, that began to change, as the kings increasingly extended their authority over public order.

Even under Anglo Saxon law, before the Norman invasion, there developed a distinction between public offenses and private wrongs, as certain kinds of disruptive and injurious behavior came to be regarded as offenses against “the king’s peace.” A breach of the king’s peace, record Pollock and Maitland, “was an act of personal disobedience, and a much graver matter than an ordinary breach of the public order; it made the wrong-doer the king’s enemy.” Frederick Pollock and Frederic Mait-land, 1 The History of English Law 45 (2d ed. 1899). Still, compensation remained an integral part of the penalty imposed on a miscreant, although, increasingly, a greater share of it was diverted to the king or the local lord. Under Anglo Saxon practice, according to Schafer: ⁴⁵⁴ '“One part of the compensation went to the victim (Wergeld, Busse, emenda, lendis). The other part went to the community or the king (Friedensgeld, fredus, gewedde ).

In Saxon England, the Wer, or payment for homicide, and the Bot, the betterment or compensation for injury, existed alongside the Wite, or fine paid to the king or overlord. This twofold payment enabled the offender to buy back the security that he had lost. The double nature of the payment shows clearly the close connection between punishment and compensation.” Schafer, supra, at 18-19. See also 1 Pollock and Maitland, supra, at 38, 47-49; 2 Pollock and Maitland at 450-52 (“The offender could buy back the peace that he had broken.

To do this he had to settle not only with the injured person but also with the king: he must make bot to the injured and pay a wite to the king.”). In time, however, the right of the victim became subservient to, and eventually was replaced by, the right of the Sovereign. As Schafer notes, “the injured person’s right to restitution began to shrink, and, after the Treaty of Verdun divided the Frankish Empire [in 843], the fine that went to the state gradually replaced it entirely. The double payment continued, but now the king or overlord took all of it.” Schafer, supra, at 19.

Thus, “[a]s the state monopolized the institution of punishment, the rights of the injured were slowly separated from the penal law: composition, as the obligation to pay damages, became separated from criminal law and became a special field in civil law.” Id. This change, notes Schafer, marked the closing phase of the period during which criminal procedure “was the private or personal concern of the victim or his family and was largely under their control,” in which the wrong done to the victim was not simply an issue but was the only issue. Id. ■ With the separation of criminal and civil law and the assumption of full control over the former by the State, the victim eventually lost any right to compensation, at least for personal injury, through the criminal process; any monetary ⁴⁵⁵ exaction was in the form of a fine that went to the State. See Comment, Compensation to Victims of Violent Crimes, 61 Nw.

U.L.Rev. 72, 76-84 (1966); see also Patrick D. McAnany, Restitution as Idea and Practice: The Retributive Process, in Offender Restitution in Theory and Action 15, 16-17 (Burt Galaway & Joe Hudson eds., 1977). That development, at least with respect to serious offenses, had been completed by the 18th century. Blackstone acknowledged that every public offense was also a private wrong but noted that, at least as to the serious offenses, “the public mischief is the thing.” William Blackstone, 4 Commentaries on the Laws of England 6 (1769). Thus, he wrote that “in these gross and atrocious injuries the private wrong is swallowed up in the public: we seldom hear any mention made of satisfaction to the individual; the satisfaction to the community being so very great.” Id.

Indeed, from a practical viewpoint, “as the public crime is not otherwise avenged than by forfeiture of life and property, it is impossible afterwards to make any reparation for the private wrong; which can only be had from the body or goods of the aggressor.” Id. With respect to those crimes of a less serious nature, in which the public punishment was not so severe, there was room for private compensation, but that was left to the civil action. 5 The inability of a victim to recover compensation in the criminal proceeding was partly restored in the case of theft. Blackstone notes that, although at common law “there was no restitution of goods upon an indictment, because it is at the suit of the king only,” by the statute 21 Hen. VIII, c. 11, restitution was provided to the victim in the case of a larceny prosecuted by the Crown.

Blackstone, supra, at 355-56. That statute is not mentioned by Julian Alexander as being one of the English statutes carried over into Maryland law ⁴⁵⁶ through Article 5 of the Declaration of Rights, but the essence of it was included in an early colonial statute and was made part of our law in the first criminal code adopted by the General Assembly. 6 By 1809 Md. Laws, ch. 138, in contrast to the exclusive punishments of death or imprisonment mandated for such crimes as murder, manslaughter, maiming, rape, sodomy, and arson, the law added as an additional punishment for burglary, robbery, and stealing offenses that the defendant “shall restore the thing taken to the owner or owners thereof, or shall pay him, her or them, the full value thereof.” The 1809 law further provided that, “in all cases where restitution or reparation is adjudged to be made to the party injured” and immediate restitution or reparation was not fully made, “the court before whom the offender is convicted shall, at the instance of the party injured, issue execution against the property of such convicted person, in the name of the person injured, for the value of the property taken, or so much thereof as is not restored, such value to be estimated by the said court.” Id. at § 23. The law continued, in a proviso, that it was not to be construed as depriving the party injured “from having and maintaining a civil action against such offender, either before or after conviction, or against any other person, for the recovery of the money received or property taken, or the value thereof.” Id. Those provisions remain in the law today with respect to theft and robbery.' See Md. Code, Art. 27, §§ 342(f), 486, 488, 806.

Notwithstanding the unbroken existence of the 1809 law permitting the criminal court to enforce a restitution order entered upon a theft conviction by attachment of the defendant’s property, we are aware of no reported case in which that was done. The only reported case under the statute ⁴⁵⁷ arose from a bill in equity to seize the property of a defendant who had escaped custody prior to trial, and thus was never convicted; our predecessors affirmed a dismissal of the bill, ruling that the plaintiff was left to a civil action at law. See Fletcher v. Hooper, 32 Md. 210 , 1870 WL 3943 (1870). With the exception of the 1809 provisions, limited as they were to theft-type offenses, the right of a crime victim to restitution through the criminal process did not take hold in Maryland, or in most of the United States, until the mid 20th century.

The movement to reconsider the plight of the victim actually began much earlier. Professor Harland notes that, “[f]rom the time that punishment of criminals and redress for victims of crime were originally affected by the medieval division of crimes and civil wrongs, jurisprudential commentators have debated the significance and wisdom of that division.” Alan T. Harland, Monetary Remedies for the Victims of Crime: Assessing the Role of the Criminal Courts, 30 UCLA L. Rev. 52 , 52 (1982) (citing works by Bentham, Austin, Holmes, Ferri, and Garofalo). The strict division and, with it, the relegation of victim compensation exclusively to the civil courts continued to have its adherents, however, especially among the legal community, their point being that the goal of the civil law is to compensate private wrongs, whereas the function of the criminal law is to redress public wrongs by punishing those who commit such wrongs, and that “because restitution is a form of compensation, it has no place in the criminal system.” 7 ⁴⁵⁸ In part because of the increasing influence of victims’ rights advocacy groups and in part due to public disenchantment with the ineffectiveness of traditional criminal sanctions in curbing criminal behavior, the proponents of change eventually succeeded in getting legislatures to provide additional mechanisms for compensating crime victims. One mechanism took the form of government compensation, as with our Criminal Injuries Compensation program (Md.Code, Art. 27, §§ 815-832; Criminal Procedures Article, §§ 11-801 — 11-819).

See Harland, supra, 30 UCLA L.Rev. at 59; Compensation to Victims of Violent Crimes, supra, 61 Nw. U.L.Rev. 72; Schafer, supra, at 105-36. The other, relevant here, was the enactment of statutes expanding the ability of criminal courts to grant restitution as part of a sentence imposed upon conviction. Most States now have such statutes, and most of those statutes are generally similar to the one in Maryland.

It appears, however, that only two States have dealt with the specific issue now before us. In Kansas, the statute itself states that a judgment of restitution is not an obligation or liability against any insurer or third-party payor, and an intermediate appellate court in California held that a judgment of restitution was similar to an award of punitive damages which, under California law, was not protected by insurance. See Kans. Stat. Ann. § 60-4301; State Farm Fire & Cas.

Co. v. Superior Court, 191 Cal.App.3d 74 , 236 Cal.Rptr. 216 (1987). Neither of those approaches operates in Maryland. We must decide this case based on the wording and purpose of § 807. Several arguments were offered for allowing criminal courts to order restitution.

One followed the pragmatic point made by Blackstone — that once the State exacted its retribution, ⁴⁵⁹ through either fine or imprisonment, there was little or nothing left for a victim to collect from the offender in a civil proceeding. Another stemmed from the more jurisprudentially-based restorative theory of justice which, to some extent, is a return to the ancient view, still current in the Orient, that the most appropriate social response to injurious behavior is reconciliation with the victim through an acknowledgment of responsibility and compensation. The third principal argument, which responded more directly to the point pressed by proponents of a strict cleavage between the civil and criminal law, was that restitution, in many cases, actually promoted the goals of the criminal law and, for that reason, should be authorized as a criminal sanction. The third argument appears to provide the most likely underpinning for restitution statutes.

The argument addresses the three principal functions of criminal punishment-rehabilitation, deterrence, and retribution. Restitution is regarded as rehabilitative to the extent that it causes the offender to focus on the victim and the harm that he or she has caused to the victim. Traditional punishment, in the form of a fine or imprisonment, is impersonal; it is imposed and implemented by the corporate State and is more likely to be resented than to serve as a spur for self-examination and acceptance of responsibility. As noted in the Harvard Law Review article, “by ordering restitution, a court forces the defendant to acknowledge in concrete terms the harm he has caused.” Victim Restitution in the Criminal Process: A Procedural Analysis, supra, 97 Harv.

L.Rev. at 938. Restitution is viewed as a deterrent, more so than a civil judgment, because it is usually tailored to the defendant’s ability to pay and it must be paid personally by the defendant, not by an insurance company or other third party. As the Harvard note observes, “[a] civil damage award, in contrast, can be paid by a third party; the possibility that the defendant may not suffer the full impact of the award may diminish the award’s deterrent effect.” Id. at 941. See also Schafer, supra, at 115; Harland, supra, 30 UCLA L.Rev. at 124 n. 405; United States v. Buechler, 557 F.2d 1002, 1007 (3d Cir.1977).

The retributive ⁴⁶⁰ value of restitution lies not only in the personal economic detriment to the offender, who may be saddled with a non-dischargeable debt for quite some time, 8 but as well in satisfying society’s demand for meaningful justice. It is the economic equivalent of the lex tallones — the offender must pay for the damage he or she has caused. 9 We have, on several occasions, recognized restitution as meeting the objectives of both rehabilitation and retribution. In Coles v. State, 290 Md. 296, 305 , 429 A.2d 1029, 1034 (1981), we declared that restitution needed to be viewed “as an aid in rehabilitating the defendant.” See also Lee v. State, 307 Md. 74, 78 , 512 A.2d 372, 374 (1986), concluding that the payment of restitution as a condition of probation was “for the fundamental purpose of rehabilitating the defendant and affording the aggrieved victim recompense for monetary loss.” In Songer v. State, 327 Md. 42, 46 , 607 A.2d 557, 559 (1992) and Anne Arundel Cty. v. Hartford Accident, 329 Md. 677, 685 , 621 A.2d 427, 431 (1993), we also acknowledged the punitive effect of restitution. Restitution statutes began to be adopted in the 1930’s, initially in the context of statutes authorizing probation in lieu of incarceration, but later as a direct dispositional alternative.

See Note, Restitution and the Criminal