State of Minnesota, Appellant, vs. David Melvin Kraft, Respondent.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (2002).

 

STATE OF MINNESOTA

IN COURT OF APPEALS

A04-468

 

 

State of Minnesota,

Appellant,

 

vs.

 

David Melvin Kraft,

Respondent.

 

 

Filed November 30, 2004

Affirmed

Halbrooks, Judge

 

 

Olmsted County District Court

File No. K7-04-15

 

 

Mike Hatch, Attorney General, 1800 NCL Tower, 445 Minnesota Street, St. Paul, MN  55101; and

 

Raymond F. Schmitz, Olmsted County Attorney, David F. McLeod, Assistant County Attorney, 151 Fourth Street Southeast, Rochester, MN 55904 (for appellant)

 

Paul H. Grinde, Deanna J. Schleusner, Ryan & Grinde, Ltd., 407 14th Street Northwest, P.O. Box 6667, Rochester, MN 55903-6667 (for respondent)

 

 

 

            Considered and decided by Halbrooks, Presiding Judge, Toussaint, Chief Judge, and Schumacher, Judge.

U N P U B L I S H E D   O P I N I O N

HALBROOKS, Judge

Appellant State of Minnesota challenges the district court's order granting respondent David Kraft's motion to dismiss a criminal complaint that charged him with unemployment-compensation fraud.  Appellant argues that the district court erred because it applied an incorrect legal standard in dismissing the complaint for lack of probable cause.  Appellant further argues that probable cause exists to support the charge of unemployment-compensation fraud.  Because we conclude that the district court applied the correct legal standard and did not err in dismissing the charge for lack of probable cause, we affirm.

FACTS

Respondent worked two full-time jobs: one at Adair Electric Company and the other at Pace Dairy Food Company.  In April 2002, he was terminated by Adair Electric and applied for unemployment benefits with the Minnesota Department of Employment and Economic Development (department).  On his application, respondent disclosed that he had a second job at Pace Dairy where he continued to work 36 hours per week.  The department thereafter established an unemployment-insurance account.  Respondent claimed and received benefits for nearly eight months, exhausting his account.  A temporary-emergency-unemployment-compensation account was then established, providing benefits to respondent for an additional 13 weeks.  In order to qualify for benefits, respondent was required to make biweekly claims to the state by telephone.  A computer-operated system on the telephone posed the following questions to the caller:

1.         Did you work?

2.         Did you receive or have you applied for income from any other sources that you haven't already told us about?

3.         Did you quit, get fired or refuse a job offer that you haven't already told us about?

4.         Were you available for work? 

 

The system did not allow for any explanation beyond a simple "yes" or "no."  Each time he called, respondent answered in the negative to the first three questions and in the affirmative to the fourth, based on the fact that he had disclosed his employment at Pace Dairy on his application. 

            In August 2002, respondent received a written overpayment determination after the department discovered that he had been overpaid for the two-week period of April 20 - May 3, 2004.  Respondent indicated that he understood the rationale underlying the overpayment determination, but he continued to apply for benefits by telephone and received them accordingly.  Respondent testified that he believed that he would be sent another overpayment determination in the event he received other benefits to which he was not entitled.  In April 2003, respondent voluntarily met with a revenue special investigator from the department.  The department advised respondent that he should not have received any of the unemployment benefits that he did.  As a consequence, respondent was asked to repay the state $16,013 (the full amount of benefits he received) and a civil penalty in the amount of $3,903.  Respondent complied and paid in full. 

Following respondent's full remuneration and payment of the civil penalty, the state charged respondent with unemployment-compensation fraud in violation of Minn. Stat. § 268.182(a) (2002), which provides:

Whoever obtains . . . by means of an intentional false statement or representation, by intentional concealment of a material fact, . . . or other fraudulent means, unemployment benefits that the individual is not entitled or unemployment benefits greater than the individual is entitled under this chapter, or under the law of any state or of the federal government, either personally or for any other individual, is guilty of theft and shall be sentenced pursuant to section 609.52.

 

Respondent moved to dismiss, asserting a lack of probable cause.  Following an omnibus hearing, the district court agreed and granted respondent's motion to dismiss for lack of probable cause. 

            Appellant filed a notice of appeal.  Respondent filed a motion to dismiss the appeal with this court, arguing that the district court's ruling was based on a factual, as opposed to a legal, determination and that the case was therefore not appealable.  We denied the motion on the ground that respondent had not sufficiently shown that the district court's order was based on a factual determination.  State v. Kraft, No. A04-468 (Minn. App. Apr. 20, 2004).  We concluded that, "[t]he district court's order, to the extent it is construed as applying the reasonable doubt standard, appears to be based on a legal determination [and is, thus, appealable]."  Id.  This appeal follows. 

D E C I S I O N

            An order dismissing a complaint for lack of probable cause is appealable if it is based on a legal determination.  Minn. R. Crim. P. 28.04, subd. 1(1); State v. Edwards, 589 N.W.2d 807, 810 (Minn. App. 1999), review denied (Minn. May 18, 1999).  This court reviews such a determination de novo.  State v. Ortiz, 626 N.W.2d 445, 448 (Minn. App. 2001), review denied (Minn. June 27, 2001).  We will reverse pretrial orders under Minn. R. Crim. P. 28.04 only when the state clearly and unequivocally demonstrates that (1) the district court erred in its judgment and (2) the error will have a critical impact on the outcome of the trial unless it is reversed.  State v. Trei, 624 N.W.2d 595, 597 (Minn. App. 2001), review dismissed (Minn. June 22, 2001).  The dismissal of a complaint will satisfy the critical-impact requirement.  Id.  Because this case was dismissed by the district court, the sole question for this court is whether the district court clearly and unequivocally erred.

The central issue in this case is whether the district court erred in dismissing the complaint for lack of probable cause based on an incorrect legal standard.  In the memorandum accompanying its order for dismissal, the district court explained, in full:

Defendant seeks to have the charge dismissed on probable cause grounds.  Under State v. Florence, 239 N.W.2d 892, 902 (Minn. 1976), the Court must determine whether it is "fair and reasonable" on the record before it to require the Defendant to stand trial.

 

Minn. Stat. § 268.182(a) requires, for criminal liability, "an intentional false statement or representation," "intentional concealment of a material fact," or "other fraudulent means" used to obtain unemployment benefits to which the person is not entitled.  Taking as true all of the evidence the State has provided the Court in this case (The Court's "function at the omnibus hearing [does] not extend to assessing the relative credibility or weight of . . . conflicting evidence."  State v. Hegstrom, 543 N.W.2d 698, 702 (Minn. App. 1996)[, review denied (Minn. Apr. 16, 1996)]) there is not sufficient proof here to infer such criminal intent beyond a reasonable doubt.  On this record it is not "fair and reasonable" to require the Defendant to stand trial.  Defendant's motion to dismiss the charge is granted.

 

The standard for probable cause is lower than the beyond-a-reasonable-doubt standard necessary for a conviction.  Probable cause exists if "evidence worthy of consideration . . . brings the charge . . . within a reasonable probability."  State v. Steinbuch, 514 N.W.2d 793, 798 (Minn. 1994) (quotation omitted).  Stated differently, probable cause exists when "the facts would lead a person of ordinary care and prudence to hold an honest and strong suspicion that the person under consideration is guilty of a crime."  Ortiz, 626 N.W.2d at 449.  "In addressing a probable cause challenge, the court must determine whether, given the facts disclosed by the record, it is fair and reasonable to require the defendant to stand trial."  Id. (citing State v. Florence, 306 Minn. 442, 457, 239 N.W.2d 892, 902 (1976)).  "If the [district court] is satisfied that the facts appearing in the record . . . would preclude the granting of a motion for a directed verdict of acquittal if proved at trial, [it] will deny the motion."  Florence, 306 Minn. at 459, 239 N.W.2d at 903. 

Here, the district court correctly analyzed whether it was fair and reasonable for respondent to stand trial but also stated the incorrect beyond-a-reasonable-doubt standard in its memorandum.  But based on a reasonable contextual reading of the district court's memorandum, we conclude that the district court ultimately utilized the proper Florence analysis.  We conclude that the district court essentially made a finding of lack of probable cause.  After fully reviewing the state's evidence on the element of the respondent's alleged intentional false statement or intentional concealment of a material fact in order to receive unemployment-compensation benefits, the district court ultimately determined that it was not fair and reasonable to require respondent to stand trial.  At the omnibus hearing, the court stated, "I'll look at this and make a probable cause determination, maybe this case has probable cause and must go to trial."  A fair interpretation of the district court's reference to the beyond-a-reasonable-doubt standard is, as respondent suggests, that the intent evidence was not sufficient to withstand a motion for directed verdict. 

Therefore, we conclude that a remand is not necessary for the sole purpose of striking superfluous language which added nothing to the court's ultimate conclusion.  See Minn. R. Civ. P. 61 (requiring harmless error to be ignored); Wibbens v. Wibbens, 379 N.W.2d 225, 227 (Minn. App. 1985) (declining to remand for a de minimis technical error).  Moreover, the district court was clear in expressing its doubts about the merits of appellant's case at the probable-cause hearing and ultimately concluded that the "State of Minnesota ha[d] not sustained its burden with respect to probable cause."

            Affirmed.