PEOPLE OF MI V CHRISTINE ANN MULLEN
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STATE OF MICHIGAN
COURT OF APPEALS
PEOPLE OF THE STATE OF MICHIGAN,
UNPUBLISHED
June 29, 2004
Plaintiff-Appellee,
v
No. 244700
Ingham County Circuit Court
LC No. 01-077566-FH
CHRISTINE ANN MULLEN,
Defendant-Appellant.
Before: Hoekstra, P.J., and O’Connell and Donofrio, JJ.
PER CURIAM.
Defendant, Christine Ann Mullen, appeals as of right her conviction by jury of felony
embezzlement by agent or trustee, MCL 750.174. The trial court sentenced defendant to two
years’ probation, including thirty days in jail1 and 300 hours of community service, and ordered
her to pay restitution in the amount of $29,748. We affirm defendant’s conviction, but vacate the
order of restitution and remand for further proceedings.
In this case, the prosecution alleged that defendant, as a Family Independence Agency
(FIA) employee, was entrusted with supervisory authority and control over the FIA’s inventory
of computer equipment. In that capacity, defendant allegedly caused two new computer servers
to be delivered to her children’s school system, the Olivet school district, without the knowledge
or consent of the state. Further, the prosecution maintained that defendant concealed the transfer
from the state by refusing to allow the school district to acknowledge the transfer of the
computer servers, telling the school district that the computer servers were utilized as part of a
pilot program that was nonexistent, and reporting on inventory records filed periodically with the
state, as administratively required, that the computer servers were stored in a state controlled
warehouse.
On appeal, defendant maintains that the trial court erred in denying her pretrial motion
for dismissal and her motions for a directed verdict2 because, at most, defendant made an
1
The jail-time was suspended pending exhaustion of any appeals.
2
Defendant moved for directed verdict at the close of the prosecution’s proofs and renewed her
motion at sentencing.
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unauthorized loan of the computers to the Olivet school district, which is insufficient to establish
the “fraudulently dispose of” element of embezzlement alleged by the prosecution. Defendant
also challenges the sufficiency of the evidence presented at trial.
We review a motion to dismiss on legal grounds for error, but if the challenge is based on
the factual sufficiency of the evidence, our review is for an abuse of discretion. People v Davis,
209 Mich App 580, 584; 531 NW2d 787 (1995). “In assessing a motion for a directed verdict of
acquittal, a trial court must consider the evidence presented by the prosecution to the time the
motion is made and in a light most favorable to the prosecution, and determine whether a rational
trier of fact could have found that the essential elements of the crime were proved beyond a
reasonable doubt.” People v Riley (After Remand), 468 Mich 135, 139-140; 659 NW2d 611
(2003). Our review of the trial court's decision on a motion for directed verdict is de novo.
People v Werner, 254 Mich App 528, 530; 659 NW2d 688 (2002). Further, “[w]hen a defendant
challenges the sufficiency of the evidence in a criminal case, this Court considers whether the
evidence, viewed in a light most favorable to the prosecution, would warrant a reasonable juror
to find guilt beyond a reasonable doubt.” Id.
At the time of the alleged criminal act, MCL 750.1743 provided in relevant part:
Any person who as the … employee of another, or as the trustee, bailee or
custodian of the property of another, … or of this state, … shall fraudulently
dispose of or convert to his own use, or take or secrete with intent to convert to
his own use without the consent of his principal, any money or other personal
property of his principal which shall have come to his possession or shall be under
his charge or control by virtue of his being such … employee, … as aforesaid,
shall be guilty of the crime of embezzlement ….
Here, the information alleged that defendant embezzled by fraudulently disposing of the
state’s computer servers, and consistent with CJI2d 27.1, the trial court instructed that this
element of embezzlement is committed if “… the Defendant dishonestly disposed of the
property.” In her brief, defendant argues that embezzlement by fraudulently disposing of
personal property is distinguishable from embezzlement by converting to one’s own use.
Defendant contends, in essence, that because the phrase “fraudulently dispose of” is not defined
in the statute, the trial court should have engaged in statutory construction and ascertained the
meaning of those words.
This Court has stated that Michigan’s embezzlement statute recognizes two distinct forms
of embezzlement. People v Wood, 182 Mich App 50, 53; 451 NW2d 563 (1990). The first of
the two is at issue here and “occurs when an individual fraudulently disposes of or converts to
his own use money or personal property of his principal.” People v Artman, 218 Mich App 236,
241; 553 NW2d 673 (1996). The other occurs by concealing with intent to convert. Id.
Consequently, the fraudulently dispose of or converts to his own use section of the statute does
not denominate separate forms of embezzlement, but rather describes only one form of
3
This statute was amended by 199 PA 312, effective January 1, 1999.
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embezzlement that is potentially committed by either disposing of or converting to one’s own
use. In this context, the apparent distinction to be drawn is whether the property is transferred to
the possession of another or is retained by the individual. In either case, however, the statute
sanctions, like any embezzlement statute, the fraudulent dispossession of money or personal
property from the one entitled to possession. In this case, defendant did not retain the property,
but rather caused the transfer of the computer servers to the Olivet school district. Consequently,
we conclude that the charges made against defendant conform to the statute and no further
definition of the statute was required.
Next, defendant claims that the transfer was not fraudulent because the evidence only
established that she made an unauthorized loan of the computer servers under circumstances
where identical computer servers were still stored in the state’s warehouse. Consequently,
according to defendant, the state was not deprived of their use and, if necessary, they were
available for return to the state from the school district. Under these circumstances, defendant
maintains that the case should have been dismissed and that there was insufficient evidence to
sustain her conviction.
However, defendant’s interpretation of the evidence fails to acknowledge the
prosecution’s claim that defendant’s transfer of the computers was dishonest and therefore
fraudulent. The dishonesty of the transfer, according to the prosecution’s theory, is shown by the
precautions taken by defendant to conceal the true nature of the transfer by telling the school
district that the computer servers were part of a pilot project when none existed and discouraging
the school district from publicly acknowledging the receipt of the computers or sending an
expression of appreciation to the state, and by continuing to certify that the computer servers
were stored in a state warehouse. Also, the prosecution showed possible motives for the act
being dishonest based on the benefit to her children’s education and defendant’s elevated status
and influence in the school district. This evidence is contrary to defendant’s contention that the
transfer represented only an unauthorized loan and generates a fact question for the jury to
resolve. Moreover, if believed, the evidence defeats defendant’s alternative argument that the
evidence was insufficient. From the evidence presented, a rational trier of fact could conclude
that the prosecution proved beyond a reasonable doubt the challenged elements of fraudulent
disposal and intent to defraud or cheat the state.
Next, defendant argues that the trial court erred in ordering restitution in the amount of
$29,748. Specifically, defendant maintains that ordering her to pay the amount the servers
depreciated in value was improper because the state did not show that the return of the servers
was inadequate. We agree.
MCL 780.767(1) provides that “[i]n determining the amount of restitution to order under
[MCL 780.766], the court shall consider the amount of the loss sustained by any victim as a
result of the offense.” MCL 780.767(4) indicates that “[a]ny dispute as to the proper amount or
type of restitution shall be resolved by the court by a preponderance of the evidence. The burden
of demonstrating the amount of the loss sustained by a victim as a result of the offense shall be
on the prosecuting attorney.” Thus, the finding of the restitution amount is a question of fact that
this Court reviews for clear error. MCR 2.613(C).
MCL 780.766(3) provides:
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If a crime results in damage to or loss or destruction of property of a
victim of the crime or results in the seizure or impoundment of property of a
victim of the crime, the order of restitution may require that the defendant do 1 or
more of the following, as applicable:
(a) Return the property to the owner of the property or to a person designated by
the owner.
(b) If return of the property under subdivision (a) is impossible, impractical, or
inadequate, pay an amount equal to the greater of subparagraph (i) or (ii), less the
value, determined as of the date the property is returned, of that property or any
part of the property that is returned:
(i) The value of the property on the date of the damage, loss, or destruction.
(ii) The value of the property on the date of sentencing.
(c) Pay the costs of the seizure or impoundment, or both.
In the present case, it is undisputed that the two computer servers were returned from the
Olivet school district to the state. Consequently, entitlement to restitution hinges on the ability
of the prosecution to show 1) that return itself was inadequate and 2) if inadequate, the difference
between the value of the computer servers on the date of the damage, loss or destruction or the
value of the computers on the date of sentencing, whichever is greater, less their value as of the
date of return. MCL 780.766(3)(b).
At the restitution hearing, the prosecution established the purchase price of the two
computer servers and their value at the time they were returned from the Olivet school district,
and requested that the trial court award them the difference, which is essentially what the trial
court ordered as the restitution. On this evidence, we find two flaws with the restitution order.
First, the trial court failed to make any finding regarding whether the return of the computer
servers was inadequate. The prosecution’s expert witness assumed that the servers were
functional for the purpose for which they were designed and that their value decreased primarily
because of technological advances, not any reduction in their functional usefulness. On this
limited record, we believe a question exists for the trial court to resolve regarding the adequacy
of the return of the two servers. Further, the prosecution’s proofs at the hearing assumed that the
purchase price paid by the state represented the value of the computer servers at the time of their
“damage, loss or destruction.” However, just as the market value of the servers declined while
being used by the school district, we have no doubt that their value also declined from the
moment that they first came into the state’s possession. Consequently, any order of restitution
must be based on their value at the time they were removed from the state’s possession, not
simply their purchase price. Accordingly, we vacate the order of restitution entered in this case
and remand for further proceeding consistent with this opinion.
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Defendant’s conviction is affirmed, but the order of restitution is vacated and remanded.
We do not retain jurisdiction.
/s/ Joel P. Hoekstra
/s/ Pat M. Donofrio
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