Lane v. State

BISHOP, Judge. A Montgomery County jury found appellant and his co-defendant, Donald Harmon, guilty of two counts of theft of property worth $300.00 or more from the Steed Mortgage Company. Md.Ann.Code 1957, art. 27, § 342 (1982 Repl. Vol.).

The Court (McAuliffe, John, J.) sentenced him to three years incarceration with all but three months suspended in consideration of three years probation. Appellant raises three issues: I. That'the evidence was insufficient to support a conviction for theft because adequate security was transferred to the mortgage company in exchange for the mortgage loans. ⁴¹⁵ II. That the trial judge committed plain error by instructing the jury that “the value of the loan at the time the loan is made determines” whether appellant committed misdemeanor or felony theft.

III

That the trial judge abused his discretion in eliciting testimony injurious to appellant after defense counsel had ended their examination of the witness. Co-defendant Harmon was in the business of purchasing, rehabilitating and reselling residential properties. Appellant, a real estate broker, was Harmon’s principal agent for the sale of these properties. As much as 90 percent of the properties owned by Harmon were listed with appellant.

Harmon paid appellant a commission of 4 to 6 percent of the selling price. The bases for the convictions were appellant’s activities regarding two of Harmon’s properties, located at 7623 Barlow Road and 6611 Drylog Road in Prince George’s County. There was evidence of a scheme to procure mortgage loans for purchasers of those properties from Steed Mortgage Company (later purchased by Gold Dome Realty Credit Company) (hereafter referred to as “Steed”) through the use of “straw buyers” and falsified employment and loan documents. The Court denied appellant’s motion for judgment of acquittal in which he argued that because the loans were secured by a deed of trust on the real estate, there was no evidence that appellant intended to deprive Steed of its money.

Alternatively, he argued that even if there had been a deprivation, its value was less than $300.00, making the offense a misdemeanor and not a felony. Art. 27, § 342(f). At the conclusion of all the evidence, the Court again denied appellant’s motion for acquittal. Barlow Road In 1981, Sylvia Elum and her husband, Keith, were Harmon’s tenants in the Barlow Road property.

Mr. & Mrs. Elum approached appellant inquiring about the purchase of ⁴¹⁶ a home. Appellant suggested the Barlow Road property. Because Keith had a poor credit history, appellant, in order to assist the Elums in purchasing the Barlow Road property, procured Michael Paige to act as a “straw purchaser” with Sylvia Elum. In exchange for “lending his credit”, appellant gave Paige a $300.00 rent credit on property Paige was renting from appellant.

Paige certified falsely that he intended to live in the Barlow Road property. Paige as principal borrower and Sylvia Elum a co-borrower applied to Steed for a mortgage loan in the amount of $47,450.00. On the application Sylvia Elum stated that she earned $708.33 per month as a bookkeeper for J & J Painting Services. At trial she testified that in fact she earned only $508.00 per month working as a housekeeper at the Georgetown Hotel.

Paige’s wage information was accurate. According to the application, their combined monthly income was $2,934.31; actually it was $2,734.80. Appellant’s son-in-law, Stuart Himes, testified that S & J Painting was his part-time business. One of the State’s exhibits notes a change of addressee from “Jay & Jay Painting” to “S & J Painting”.

Apparently, on the loan application, “J & J” was intended to be “S & J”. S & J frequently cleaned and refurbished homes on appellant’s behalf. At appellant’s request and “as a favor to help someone qualify” Himes signed a blank form falsely verifying Sylvia Elum’s employment with S & J. Himes' had never met her. Alison Himes, appellant’s daughter and Stuart Himes’ wife, was an employee in appellant’s real estate office.

She testified that on the blank application form, which her husband had signed, she filled in false information concerning Elum’s position with S & J, her salary, length of employment and finally, probability of future employment, which she classified as “good”. Because there was also a problem with Michael Paige’s qualifications, appellant induced Paige’s co-worker, Willie ⁴¹⁷ Taylor, to certify falsely that Paige was his nephew and that he was making a $3,000.00 gift to him. Steed approved a loan for $47,450.00. A Steed mortgage underwriter testified that she would not have approved the loan to Paige and Elum in that amount with the agreed interest rate, had she known the true stati of the applicants.

At settlement Steed issued a check in the net amount of $44,411.02 payable to the settlement attorney and to the mortgagors, Paige and Elum. In exchange, Steed took from Paige and Elum a purchase money deed of trust on the property which referred to a contemporaneously executed promissory note. As listing broker, appellant received a commission of $1,998.00 and a bonus of $300.00. The purchase price of the property was $49,450.00, the amount of the appraisal at the time of the settlement.

Sylvia Elum testified that it was not until after they signed the “papers” that she realized her monthly payments to Steed would be $770.00. Because she was unable to make any of the payments, she moved out of the residence in April of 1982, five months after settlement. As a result of her default, Steed’s successor corporation, Gold Dome Realty Credit foreclosed and a new owner took over the property. Drylog Road At appellant’s request, in exchange for a $500.00 fee paid to her by appellant, Pauline Cypress “lent her credit” in order to assist co-defendant Harmon’s friend and sometime employee Phillip Dillon, Jr. to qualify for a mortgage to purchase Harmon’s Drylog Road property.

At no time did Cypress intend to live on the property. Appellant told her that he himself would own the property. The Cypress and Dillon loan application correctly stated that Cypress was employed full time with the D.C. Office of Personnel and part time as a cashier in a liquor store with a total combined monthly earnings of $2,044.66. Falsely stated on the application was that Dillon was employed as a ⁴¹⁸ foreman with R.J. & Sons Construction, earning $3,033.33 monthly.

Cypress and Dillon falsely certified that they had a joint monthly income of $5,077.00. Co-defendant Harmon’s sister-in-law and bookkeeper, Sharon Harmon, testified that from July, 1981, to February, 1982, Dillon performed maintenance and yard work for Harmon on a sporadic basis and earned about $50.00 per job. There is nothing in the record indicating that Dillon had any steady income. He did not testify.

Sharon Harmon also testified that her husband, Donald Harmon, co-defendant’s brother, owned R.J. & Sons Construction and that Dillon not only never worked for that company as a foreman but the company did not employ a foreman. Appellant’s daughter, Alison Himes, testified that at meetings she attended with co-defendant Harmon, appellant, Harmon’s secretary Kay Verhalen, and others, it was said that “they [co-defendant Harmon and appellant Lane] were going to give [Dillon] employment with R.J. & Sons ... [to help him] qualify for a particular house.” Although Dillon’s employment verification was signed by a “Sharon Martin”, Sharon Harmon’s maiden name, the latter denied having signed it. The telephone number listed for R.J. & Sons Construction on the loan application was actually that of co-defendant Harmon’s office. Harmon had instructed his secretary, Verhalen, who had in turn instructed Sharon Harmon, to answer the telephone with “hello” and to expect a call verifying Dillon’s employment with R.J. & Sons Construction.

Messages were to be taken and given to Harmon. Steed approved the loan of $72,200.00. At settlement Steed issued a check in the net amount of $68,028.32 payable to the settlement attorney and mortgagors Dillon and Cypress. In exchange, Steed received a purchase money deed of trust from Dillon and Cypress securing the total amount of the loan.

The deed of trust referred to a promissory note contemporaneously executed by Dillon and Cypress. Appellant received a commission of $2,800.00. A ⁴¹⁹ Steed mortgage underwriter testified that the loan to Dillon and Cypress would not have been approved had she known the true facts underlying the application. There was testimony that the Drylog Road property was in the process of foreclosure, but it was not known whether the process had been completed.

An appraiser testified that the property had a value of $77,500.00 at approximately the time of settlement. Pauline Cypress testified that after she was contacted by Montgomery County State’s Attorney investigators, she falsely told them, at appellant’s direction that: (1) she was planning to move into the Drylog Road property with Dillon and that her son was going to help with the payments; (2) she had not moved into the house because of recent surgery. Sufficiency of the Evidence Appellant’s conviction must be affirmed if “after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.” Jackson v. Virginia, 443 U.S. 307, 319 , 99 S.Ct. 2781, 2789 , 61 L.Ed.2d 560 (1979); Tichnell v. State, 287 Md. 695, 717 , 415 A.2d 830 (1980). The legislature revised the theft laws in 1979 in order to create a “single consolidated offense designated as ‘theft’...

The purpose of this revision [was] to eliminate [the] technical and absurd distinctions that have plagued the larceny related offenses and produced a plethora of special provisions.” Joint Subcommittee on Theft Related Offenses, Revision of Maryland Theft Laws and Bad Check Laws, p. 2 (October, 1978). Under the new law “[c]onduct designated as theft ... constitutes a single crime embracing, among others, the separate crimes, heretofore known as larceny, larceny by trick, larceny after trust, embezzlement, false pretenses, shoplifting and receiving stolen property.” Md.Ann.Code 1957, art. 27, § 341 (1982 Repl.Vol.). ⁴²⁰ While the statute codifies a single offense called “theft”, it sets forth several different methods for its commission: A person commits a theft whenever with the intention to deprive the owner of the property, he: (a) obtains or exerts unauthorized control of the property of another, (b) obtains control over the property of another by deception, (c) obtains the services of another person by deception, (d) possesses lost, mislaid or mistakenly delivered property and he knows or can reasonably ascertain the identity of the true owner; or (e) possesses stolen property knowing or believing that it had been stolen.” Gilbert & Moylan, Maryland Criminal Law: Practice and Procedure, § 19.5 (1983) (Citations Omitted); Art. 27, § 342(a)-(e). If the evidence against appellant was sufficient to prove theft under any subsection of § 342, the court may affirm. See Art. 27, § 341; Gilbert & Moylan, supra, § 19.1, pp. 204-205, (“the careful practioners of law will demand particulars from the prosecution in order to ascertain precisely the offense alleged to constitute theft.”) We hold that evidence was sufficient for a rational trier of fact to conclude that appellant was guilty of theft by deception.

Art. 27, § 342(b). That subsection provides: (b) Obtaining control by deception. — A person commits the offense of theft when he willfully or knowingly uses deception to obtain and does obtain control over the property of the owner, and; (1) Has the purpose of depriving the owner of the property; or (2) Willfully or knowingly uses, conceals or abandons the property in such manner as to deprive the owner of the property; or (3) Uses, conceals or abandons the property knowing such use, concealment, or abandonment probably will deprive the owner of the property. Appellant concedes that he procured and then induced both Michael Paige and Pauline Cypress to certify falsely to Steed that they were co-purchasers and future residents of ⁴²¹ the Barlow Road and Drylog Road properties, respectively. Also, it is clear that neither of the actual purchasers would have individually qualified for the respective mortgages.

Appellant personally arranged for the false employment verification of Elum and was implicated in the false employment verification of Dillon. The jury could have and apparently did conclude that had appellant not engaged in these acts of deception and had Steed been aware of the financial stati of the real purchasers, Steed would not have parted with its money. From this fact, the jury could fairly infer that appellant used deception to obtain control of the property of Steed. Art. 27, § 340(h) provides that “Property funder § 342] means anything of value, including, but not limited to...

(2) money (3) commercial instruments____” That the checks were issued to the purported “home buyers” and not to appellant is irrelevant under the statute. “ ‘Obtain’ means: (1) in relation to property, to bring about a transfer of interest or possession whether to the offender or another ...” Art. 27, § 340(f) (Emphasis added). Before this Court appellant maintained, despite the evidence, that because Steed received a purchase money deed of trust securing the amount of the loans, and because the State failed to show any pecuniary loss to Steed upon foreclosures of the Barlow Road and Drylog Road properties, there was no evidence that he deprived Steed of any property. Without a loss or deprivation, he argues, there is no theft under the statute. Appellant urges the Court to adopt the holding of the Georgia Supreme Court in the case of McGhee v. State, 97 Ga. 199 , 22 S.E. 589 (1895).

The appellant in that case was convicted under Georgia’s 1895 cheating and swindling statute, § 4587. Although the state had shown that appellant procured a loan by misrepresenting that the security was unencumbered, the court reversed the conviction because there was no proof from the creditor that he had suffered any pecuniary loss upon foreclosure. Not only are the facts distinguishable from the case at bar, ⁴²² but its holding is contrary to the majority of other jurisdictions which do not require proof of loss. See, e.g., Nelson v. United States, 227 F.2d 21, 23 (D.C.Cir., 1955) (where defendant misrepresented extent of prior encumbrance on collateral used to secure payment for goods transferred and creditor relied on misrepresentation in transferring property, the fact that collateral actually had