COMMONWEALTH vs. JAMES O. MILLS

CYPHER, J. A Superior Court jury found the defendant guilty of two counts of larceny by false pretenses, G. L. c. 266, s. 30, from the Committee for Public Counsel Services (CPCS); three counts of larceny, G. L. c. 266, s. 30, from the Boston Retirement Board (BRB); three counts of perjury, G. L. c. 268, s.1A; three counts of pension fraud, G. L. c. 32, s. 18; two counts of procurement fraud, G. L. c. 266, s. 67A; two counts of false claims, G. L. c. 266, s. 67B; and four counts of failure to make

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tax returns, G. L. c. 62C, s. 73(c). After finding the defendant to be a "common and notorious thief" pursuant to G. L. 266, s. 40, based on the five larceny convictions, the judge sentenced the defendant to serve no less than eighteen and no more than twenty years in prison with various concurrent sentences on the remaining charges [Note 1].

On appeal, the defendant argues that the trial judge effed in denying his motion for a required finding of not guilty as to the charges of larceny from the BRB; in adjudicating him a "common and notorious thief "; and in considering several inappropriate factors in sentencing. We conclude that the motion for a required finding as to larceny from the BRB should have been allowed. Because of the result we reach on these three larceny counts, we vacate as well the adjudication of the defendant as a "common and notorious thief" pursuant to G. L. c. 266, s. 40, and therefore remand the matter to the Superior Court for resentencing.

Factual background. From 1993 through 1995, the defendant, a retired police officer, received numerous court appointments as a private investigator on behalf of Mills Investigations, Inc. [Note 2] The defendant was the incorporator, treasurer, and one of the directors of the corporation, which he ran from his home in New Hampshire. The defendant's wife was recorded as

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president of the corporation but she never did any work related to the corporation and maintained a full-time job elsewhere. Most of the corporation's clients came from court appointments, and the defendant signed all of the bills for investigative services submitted to CPCS.

Evidence established that the defendant substantially overbilled CPCS from 1992 to July 1995 for work not performed [Note 3] and that he withdrew significant amounts of money from the corporate account for his own personal use [Note 4].

False earnings reports. The defendant had retired in 1980 from the Boston police force because of disability (hypertensive heart disease) and thereafter received benefits of approximately $15,000 per year. Following receipt of pension benefits, every disability pensioner is required by statute to file a yearly earnings, report, signed under the pains and penalties of perjury. See G. L. c. 32, s. 91A. The BRB calculates an income limitation for each disability pensioner, and the pensioner must refund a dollar's worth of pension for each dollar of income over the income limitation. To collect money owed, the BRB sends bills to pensioners. If the pensioner does not send in the refund, the BRB withholds the amount due from the current pension payment.

The BRB had estimated that the defendant could earn between $30,000 and $32,000, approximately, during each of the years 1992 through 1994 before being required to refund any pension money. On earnings reports filed with the BRB, the defendant listed his employer as "Investigations, Inc." instead of Mills

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Investigations, Inc. [Note 5] In 1992, the year the defendant withdrew $89,637 from the corporate account of Mills Investigations, Inc., he reported to the BRB that he had earned a total of $25,000. In 1993, the year he withdrew $65,640, he reported that he had earned a total of $17,500. In 1994, the year he withdrew $104,494, he reported that he had earned $30,000. As a result of the defendant under-reporting his earnings, the BRB never sought a refund of any pension money.

At trial, the theory of defense was that the defendant merely worked very hard for Mills Investigations, Inc., a corporation "owned" by his wife (the sole stockholder), that the corporation did not intentionally over-bill CPCS, that the money used from the corporate account was for legitimate business expenses, and that he did not earn in excess of the minimum permitted by the BRB.

The motion for required finding of not guilty. The defendant argues that the trial judge effed in denying his motion for a required finding of not guilty with regard to the indictments charging larceny from the BRB because the Commonwealth tried the case on a theory of larceny "by stealing money or a release of money" and the evidence, viewed in the light most favorable to the Commonwealth, did not support a conviction for stealing on the theory presented to the jury. The Commonwealth contends that by arguing at trial that the defendant "stole" from the BRB, it was not limited to proving larceny, that stealing encompasses embezzlement, and that the instruction on larceny was sufficiently broad to include embezzlement. In response to the Commonwealth's argument on appeal that it proved embezzlement, the defendant contends that this amounts to a change of the theory of the case on appeal, that the theory was not submitted to the jury, and that the larceny instruction did not encompass embezzlement.

The defendant's motion for a required finding of not guilty was duly made and renewed. The motion was general in nature; therefore, if the evidence was sufficient on any theory properly presented to the jury, the motion was correctly denied. Commonwealth v. Domanski, 332 Mass. 66, 75-76 (1954).

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Commonwealth v. Kalinowski, 360 Mass. 682, 686 (1971). Commonwealth v. Berry, 431 Mass. 326, 330-331 (2000).

Review of a denial of a motion for a required finding of not guilty requires that we determine "whether, 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" (emphasis in original). Jackson v. Virginia, 443 U.S. 307, 318-319 (1979). Commonwealth v. Latimore, 378 Mass. 671, 677 (1979).

It is well-established that G. L. c. 266, s. 30 [Note 6], combined three common law theories of culpability for stealing (larceny, larceny by false pretenses, and embezzlement) into one statutory crime. Commonwealth v. Kelly, 24 Mass. App. Ct. 181, 183-184 (1987). Commonwealth v. Nadal-Ginard, 42 Mass. App. Ct. 1, 7 (1997). The purpose of the assimilation was to eliminate fatal variances in an indictment for stealing alleging one theory of culpability, where, at trial, the government proved stealing by a different theory of culpability. Commonwealth v. Kelley, 184 Mass. 320, 324 (1903). Commonwealth v. King, 202 Mass. 379, 387-393 (1903). Commonwealth v. Nadal-Ginard, 42 Mass. App. Ct. at 7. Proof of larceny, larceny by false pretenses, or embezzlement will establish a violation of G. L. c. 266, s. 30, regardless of how the charging document describes the manner of theft. Commonwealth v. Corcoran, 348 Mass. 437, 440-442 (1965). Commonwealth v. Nadal-Ginard, 42 Mass. App. Ct. at 7 [Note 7]. Nevertheless, despite the assimilation of all three theories of culpability into one statutory crime, the constituent crimes

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survive. Commonwealth v. Nadal-Ginard, 42 Mass. App. Ct. at 5, n.6. Conviction under G. L. c. 266, s. 30, must be based on proof of one or more of the elements of the former separate crimes [Note 8].

Had the evidence, viewed in the light most favorable to the Commonwealth, established the essential elements beyond a reasonable doubt of any one of the three theories of culpability for larceny, the motion for a required finding of not guilty would have been properly denied, provided that the theory was properly submitted to the jury. Commonwealth v. Kenneally, 10 Mass. App. Ct. 162, 176 (1980), S.C., 383 Mass. 269, cert. denied, 454 U.S. 849 (1981). The indictment for larceny from the BRB contained three counts which alleged that on three different dates (April 4, 1993, April 15, 1994, and February 28, 1995) the defendant violated G. L. c. 266, s. 30, by stealing "money or a release of a claim to money." The dates specified were the dates on which the defendant submitted his earnings reports to the BRB, as required by G. L. c. 32, s. 91A. At trial, the Commonwealth simply argued to the jury that the defendant stole from the BRB by submitting the false earnings reports.

"To support a conviction of larceny under G. L. c. 266, s. 30, the Commonwealth is required to prove the 'unlawful taking and carrying away of the personal property of another with the specific intent to deprive the person of the property permanently'" (footnote omitted). Commonwealth v. Donovan, 395 Mass. 20, 25-26 (1985), quoting from Commonwealth v. Johnson, 379 Mass. 177, 181 (1979). See Model Jury Instructions for Use in the District Court s. 5.41 (1997). Filing false earnings reports did not constitute a trespassory taking of money, and the "release of the right to money" is not property

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within the meaning of the statute or the common law [Note 9]. Although the word "release" specifically appears in the statute, it refers to a tangible writing. See Commonwealth v. Engleman, 336 Mass. 66, 69 (1957) (statutory language of "a deed or writing containing a conveyance of land, any valuable contract in force, a receipt, release or defeasance, a writ, process, certificate of title" refers to writings); Commonwealth v. Yourawski, 384 Mass. 386, 388 (1981) (definition of property in G. L. c. 266, s. 30[2], is all inclusive) [Note 10]. There was no evidence of stealing a written release. Nor does the fact that the defendant avoided the creation of a debt to the BRB by filing a false report render the defendant culpable for larceny. See Commonwealth v. Rivers, 31 Mass. App. Ct. 669, 670 (1991) (money owed to town for use of landfill was not larceny). But see note 11, infra.

The Commonwealth argues that the motion for required finding of not guilty was, nevertheless, properly denied because the indictment, by using the word "steal," encompassed the crime of embezzlement. See Commonwealth v. King, 202 Mass. at 385 (the word "steal" is a term of art which includes the criminal taking or conversion by way of larceny, embezzlement, or false pretenses). According to the Commonwealth, the defendant was only "conditionally" entitled to the pension money because he received it upon the trust that he would refund it or a portion of it if his income exceeded a certain level. Therefore, the filing of the false earnings reports constituted a fraudulent conversion. See Gibraltar Fin. Corp. v.

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Lumbermens Mut. Ins. Co., 400 Mass. 870, 873 (1987) (conversion requires interference with property to which another has a superior and immediate right of possession). See generally LaFave & Scott, Substantive Criminal Law s. 8.6, at 379 (1986) (embezzlement means "fraudulently converts").

Assuming, without deciding, that the Commonwealth tried the case on a theory of embezzlement, the motion for required finding nevertheless should have been allowed [Note 11]. Inherent in the crime of embezzlement is trust. Commonwealth v. Hays, 14 Gray 62, 63-65 (1859). See Commonwealth v. Ryan, 155 Mass. 523 (1892) (Holmes, J.) (embezzlement is the fraudulent conversion of property by one entrusted with its lawful possession); Commonwealth v. Geane, ante 149, 153 (2001) (no "conversion" where there was no special relationship between defendant and subcontractors). See generally Nolan & Henry, Criminal Law s. 348, at 266 & n.5 (2d ed. 1988) (relationship of trust and confidence reposed in the defendant by the victim is a common thread in all embezzlement cases). To establish embezzlement the Commonwealth was required to prove:

"First: That the defendant, while in a position of trust or

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confidence, was entrusted with possession of personal property belonging to another person;

"Second: That the defendant took that property, or hid it, or converted it to his (her) own use, without the consent of the owner; and

"Third: That the defendant did so with the intent to deprive the owner of the property permanently."

Model Jury Instructions for the District Court s. 5.415 (1997).

No evidence was presented to the jury to support a conclusion that the defendant was in a position of trust or confidence with the BRB, or that his receipt of pension money was "conditional" on truthful earnings reports being filed and that that money belonged to the BRB until then. Furthermore, as with larceny, a mere debtor-creditor relationship does not permit a finding of embezzlement. See Commonwealth v. Hutchins, 232 Mass. 285, 290-292 (1919); Commonwealth v. Anthony, 306 Mass. 470, 476-477 (1940); Mickelson v. Barnet, 390 Mass. 786, 790 (1984); Commonwealth v. Moreton, 48 Mass. App. Ct. 215, 221-222 (1999) (Brown, J., dissenting); Commonwealth v. Geane, supra at 153. The motion for a required finding of not guilty as to the charges of larceny from the BRB should have been allowed.

Claim of improper sentencing. We reverse the defendant's three convictions for larceny from the BRB, leaving in place the two convictions for larceny from CPCS. Three convictions, however, are required in order to sentence a person as a "common and notorious thief." See note 1, supra. Because the other sentences were ordered to run concurrently with the "common and notorious thief" sentence, we remand the matter to Superior Court for resentencing on the remaining convictions. We think it appropriate, in the circumstances of this case, to take the unusual step of ordering that resentencing take place before a different judge [Note 12]. Commonwealth v. Coleman, 390 Mass. 797,

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810-811 n.15 (1984). See Commonwealth v. White, 48 Mass. App. Ct. 658, 664 (2000).

The judgment is reversed as to the indictment alleging three counts of larceny from the BRB, the verdicts on those counts are set aside, and judgment is to be entered for the defendant on those counts. The adjudication of the defendant as a common and notorious thief is reversed and the sentence under G. L. c. 266, s. 40, is vacated. The case is remanded to the Superior Court for resentencing by a different judge on the remaining indictments, all of which were to run concurrently with the

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sentence as a common and notorious thief: namely, two counts of larceny by false pretenses from CPCS, three counts of perjury, three counts of pension fraud, two counts of false claims, and four counts of failure to make tax returns.

So ordered.