State v. Bradshaw

152 P.3d 288

2006 UT 87

STATE of Utah, Plaintiff and Petitioner, v. Brooks BRADSHAW, Defendant and Respondent.

No. 20040975.

Supreme Court of Utah.

December 29, 2006.

Mark L. Shurtleff, Att'y Gen., Charlene Barlow, Christine F. Soltis, Asst. Att'ys Gen., Salt Lake City, for plaintiff.

Joan C. Watt, Robert K. Heineman, Salt Lake City, for defendant.

On Certiorari to the Utah Court of Appeals

NEHRING, Justice:

INTRODUCTION

¶ 1 Representing himself as an owner of a mortgage company, Brooks Bradshaw assured his fourteen victims that he could help them refinance their current mortgages. After collecting fees from his victims, Mr. Bradshaw disappeared.

¶ 2 Mr. Bradshaw was charged with eleven counts of communications fraud.¹ The district court concluded that Mr. Bradshaw's defraudation of his fourteen victims was part of a single "scheme or artifice." As such, Mr. Bradshaw was exposed to conviction for eleven second degree felonies under Utah's communications fraud statute, Utah Code Ann. § 76-10-1801 (2003), despite the fact that the amount of money Mr. Bradshaw took from each individual or couple would have made Mr. Bradshaw culpable for only a class A misdemeanor offense. The divided court of appeals rejected the district court's interpretation. We conclude that the district court's interpretation was correct and reverse the court of appeals.

BACKGROUND

¶ 3 Mr. Bradshaw waived his right to a preliminary hearing. Instead, Mr. Bradshaw and the State stipulated to the facts and asked the district court to determine whether those facts supported a bindover on eleven counts of second degree felony communications fraud. The district court concluded that they did.² According to the stipulated facts, over the course of approximately three months, Mr. Bradshaw targeted and then defrauded fourteen persons of monies ranging from $400 to $600, ultimately accumulating a total of $5,400. In each instance, Mr. Bradshaw targeted persons who were trying to refinance a mortgage on a residence or were trying to acquire a loan to avoid foreclosure. Mr. Bradshaw met with his victims in their homes. He falsely represented himself as either an owner or a co-owner of a mortgage company and assured his victims that he would refinance their current mortgage for a fee. He told them that the fees would be used to compensate him for his services and to obtain appraisals, title searches, and credit reports. Mr. Bradshaw never performed any of the promised services, and his victims were never able to locate him after he departed with their money.

¶ 4 At times, Mr. Bradshaw's method of operation varied among his victims. For example, on one occasion, Mr. Bradshaw brought an associate who claimed to be an appraiser to meet with a victim. On another occasion, he offered to purchase a victim's store. He also offered to help acquire financing for a "real estate project [a victim] was attempting to complete."

¶ 5 The State charged Mr. Bradshaw with eleven counts of second degree felony communications fraud because it considered that Mr. Bradshaw's eleven acts of guile to be part of a single "scheme." The State insisted that if Mr. Bradshaw defrauded all fourteen victims through a single scheme, two provisions of the communications fraud statute came into play: one that designated each communication made for the purpose of executing or concealing the scheme as a separate offense and another that measured the degree of each separate offense by totaling the amount of money obtained from the "scheme or artifice." Utah Code Ann. § 76-10-1801(2), (5) (2003). Because the State considered Mr. Bradshaw's eleven fraudulent acts to be part of a single "scheme or artifice," it accumulated the amounts Mr. Bradshaw took from his victims—a total of $5,400—and used that amount to determine that the degree of the eleven offenses was second degree felonies.

¶ 6 Mr. Bradshaw moved to quash his bindover on the felony communications fraud charges. He contended that he had defrauded his fourteen victims through eleven separate, individual schemes. Therefore, he argued, it would be improper to aggregate the amounts taken from the victims for the purpose of fixing the degree of the offense and then disaggregate the fraudulent acts so that he could be charged with eleven more serious offenses. Mr. Bradshaw asserted that, under a proper reading of the communications fraud statute, he should face, at most, eleven class A misdemeanors or one second degree felony.

¶ 7 The district court denied Mr. Bradshaw's motion, and Mr. Bradshaw entered into a plea agreement. He pled guilty to four counts of attempted communications fraud—third degree felonies under section 76-4-102(3)—and reserved the right to appeal the district court's denial of his motion. The district court accepted the pleas, and the remaining charges were dropped. Mr. Bradshaw then appealed the district court's order on his motion to quash, and the court of appeals reversed the district court. The State sought certiorari review, which we granted to consider whether the court of appeals properly interpreted the communications fraud statute when it held that Mr. Bradshaw's fraudulent activities were not separate parts of a single scheme.³

ANALYSIS

¶ 8 The issue at hand calls upon us to interpret Utah's communications fraud statute and apply it to accepted facts. We proceed without deferring to the interpretation of the statute adopted by the court of appeals' majority. John Holmes Constr., Inc. v. R.A. McKell Excavating, Inc., 2005 UT 83, ¶ 6, 131 P.3d 199. We hold that conduct which qualifies as a "scheme or artifice" under the communications fraud statute may involve multiple acts, actors, and victims. The acts, however, must share a sufficient number of common elements to permit a reasonable person to conclude that they were part of a single criminal design.

¶ 9 As noted above, the question of whether multiple fraudulent acts are part of a single scheme or are, instead, separate criminal episodes is a matter of great importance in the application of the communications fraud statute. The communications fraud statute provides that each communication made in furtherance of a scheme to defraud constitutes a separate offense. Utah Code Ann. § 76-10-1801(5) (2003). The statute also directs that the severity of each separate offense be determined by the aggregate of the monies obtained or sought to be obtained by the "scheme or artifice." Id. § 76-10-1801(2). The statute does not, however, offer further guidance on how to identify a "scheme or artifice."

¶ 10 The court of appeals' majority concluded that the term "scheme or artifice" as used in the communications fraud statute was ambiguous. It justified this conclusion by drawing on United States Supreme Court commentary on the "`highly elastic'" nature of the term. State v. Bradshaw, 2004 UT App 298, ¶ 17, 99 P.3d 359 (Thorne, J., dissenting) (quoting H.J. Inc. v. Nw. Bell Tel. Co., 492 U.S. 229, 241 n. 3, 109 S.Ct. 2893, 106 L.Ed.2d 195 (1989)). We have no quarrel with this characterization of "scheme" or with the Supreme Court's observation that the term is "`hardly self-defining.'" Id. (quoting H.J. Inc., 492 U.S. at 241 n. 3, 109 S.Ct. 2893). We are not persuaded, however, that definitional elasticity is synonymous with ambiguity. Nor are we convinced, even in the absence of definitional precision, that a court is free to immediately apply more generalized principles of statutory interpretation—like the rule of lenity or relevant public policy considerations—without first exploring whether a reliable definition of the term may be ascertained from authoritative extra-textual sources. While public policy considerations and the rule of lenity impose limitations on definitions, they illuminate definition indirectly. Our first inquiry should be into sources of guidance on the actual meaning of the term itself.

¶ 11 The term "scheme or artifice" is an established term of art that has been repeatedly defined in state and federal cases throughout the country. Indeed, the Utah communications fraud statute borrowed the term from the federal mail and wire fraud statutes. Floor Debate, 46th Leg., Gen. Sess. (Utah Feb. 27, 1985) (Senate recording no. 129) (statements of U.S. Attorney for Utah Brent Ward) ("The language of the bill is based on the federal mail and wire fraud statutes. These statutes have withstood the test of almost 100 years [of] experience."). Other courts' interpretations of that term, therefore, are instructive and aid us in our efforts to interpret the Utah statute.

¶ 12 We find that the term scheme "refers to the overall design to defraud one or many by means of a common plan or technique." United States v. Massey, 48 F.3d 1560, 1566 (10th Cir.1995). A single scheme can include a series of separate but similar fraudulent acts, as long as the separate acts are linked by a common, continuing criminal design.

¶ 13 The court of appeals held that a single scheme could not include criminal activity where victims are deceived "at different times, in different places, by different stories, and through different methods." Bradshaw, 2004 UT App 298, ¶ 20, 99 P.3d 359. While this interpretation would treat the defrauding of multiple victims as a single scheme if the fraudulent misrepresentation or omission were made at one time and in one place to a single group of people, id. ¶ 20 n. 7, we nevertheless find too limiting the court of appeals' emphasis on commonality of time and place. A series of fraudulent acts aimed at obtaining one criminal objective clearly constitutes a single scheme, but so does a series of similar fraudulent acts separated by time and place but linked by a common, continuing criminal design. See State v. Fleming, 225 Mont. 48, 730 P.2d 1178, 1180 (1987) (defining, by statute, a "`common scheme' ... as a series of acts or omissions motivated by a purpose to accomplish a single criminal objective or by a common purpose or...