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Albertson v. State

Court of Special Appeals of Maryland

June 27, 2013

KIRK ALBERTSON
v.
STATE OF MARYLAND

Wright, Berger, Eyler, James R., (Retired, Specially Assigned) JJ.

OPINION

Eyler, James R., J.

Appellant, Kirk Albertson, was charged in the Circuit Court for Talbot County, Maryland, with theft scheme, multiple counts of passing bad checks which were dishonored for insufficient funds and stop payment orders, and multiple counts of theft over $500. After a jury trial, appellant was convicted of four counts of passing bad checks in violation of Section 8-103 (a) of the Criminal Law Article, and three counts of passing bad checks in violation of Section 8-103 (b). Appellant was sentenced to seven concurrent terms of eighteen months, with twelve months suspended on each count, for an aggregate unsuspended sentence of six months. He was also ordered to pay restitution and was placed on supervised probation for five years. Appellant timely appealed and, rephrased and reordered, presents the following questions for our review:

1. Did the trial court err in declining to give a jury instruction that explained the difference between a civil cause of action and a criminal charge for passing a bad check based on insufficient funds?
2.Was the evidence insufficient to sustain appellant's convictions for violations of Sections 8-103 (a) and 8-103 (b) of the Criminal Law Article?

For the following reasons, we agree that there was error in instructing the jury as to the four counts under Section 8-103 (a). We also agree that the evidence was insufficient to sustain the convictions under those counts. The judgments are otherwise affirmed.

BACKGROUND

State's Case-In-Chief

This case concerns the business dealings between the victim, Ed Scherl, a licensed auto-broker, and Rokabil Motors LLC ("Rokabil"), a retail used car dealership owned by appellant and William Haddaway.[1] Scherl's role was to provide Rokabil with used cars that Rokabil would then place on its lot for sale to the general public, including to persons with poor or no credit. When a car sale was made, Scherl would deliver title to said vehicle to Rokabil, in exchange for a check in the amount of the sale.

Scherl testified that, when he received checks in exchange for title to the cars, he would collect them and deposit them between one and ten days after the transfer. After certain checks started bouncing, Scherl went directly to Rokabil's bank, Talbot Bank, where he learned that the checks were not "any good." Scherl testified that appellant or Haddaway normally signed the checks, and that Carol Northcut, an employee of Rokabil, would sometimes sign paperwork associated with the transfer of the vehicles.

A bank representative from Talbot Bank, Wanda Hutchinson, testified that appellant and Haddaway had signature authority for the Rokabil bank account. Referring to certificates of dishonor for the pertinent checks, Hutchinson explained that a check is "uttered" on the day it is written, and is "presented" when it comes to the bank for payment. Hutchinson then addressed the first four checks at issue in this appeal, testifying to the check number, the amount, the day the check was uttered (issued), the amount of funds available on that day, the day the check was presented for payment, and the amount of funds available on the date of presentment. According to Scherl, the checks were signed and delivered to him by appellant in appellant's office.[2] Looking to both Hutchinson's and Scherl's testimony at trial, the following table details the relevant figures for these four checks, including the vehicles associated with these checks:

Count

Vehicle

Check No.

Uttered

Amount

Opening Balance

Closing Balance

High Balance

10

Mazda Protege

2568

09/22/09

$2, 675.00

$3, 845.33

$3, 725.33

$3, 845.33

12

Pontiac Bonneville

2582

09/28/09

$3, 300.00

$297.07 overdrawn

$8, 875.14

$8, 875.14

14

Saturn

2583

09/28/09

$2, 650.00

$297.07 overdrawn

$8, 875.14

$8, 875.14

16

Nissan Altima

2584

09/28/09

$3, 250.00

$297.07 overdrawn

$8, 875.14

$8, 875.14

Thereafter, all four of the checks were presented on the same day, November 3, 2009, notably more than thirty days after they were uttered. On that day, these four checks were all dishonored for insufficient funds ("ISF"). The Rokabil account was overdrawn by $159.09 at opening, the high balance for the day; at closing, the account was ultimately overdrawn by $579.08. Scherl testified at trial that he received neither the money due for these four vehicles, nor the return of the vehicles themselves.

A representative from Queenstown Bank of Maryland, Heather Jarrell, testified to the remaining three checks at issue. Jarrell testified that a new bank account in the name of William Haddaway doing business as RMC Holdings was opened on October 5, 2009, with a $75.00 deposit. By the end of October, the balance had increased to $1, 305.00.

Pertinent to our discussion, Jarrell testified that three checks, all payable to Scherl, were ultimately dishonored and not paid due to the placement of stop payment orders. ("SPO"). Scherl testified at trial that these checks were signed by appellant at Rokabil Motors. Scherl also explained that these checks were purportedly to replace three checks from the Talbot Bank account that were given by Rokabil in exchange for the transfer of title of three vehicles different from those listed above:

Count

Vehicle

Check

Uttered

Amount

Replaces Talbot Bank Check No.

Queenstown Bank Balance

18

Honda Civic

1001

10/09/09

$5, 500.00

2515

$75.00

22

Ford Ranger

1003

10/09/09

$3, 600.00

2516

$75.00

24

Dodge Caravan

1004

10/09/09

$3, 100.00

2489

$75.00

A stop payment was ordered on these three Queenstown Bank checks on October 19, 2009. There is no indication in the record who ordered the stop payment. The checks were then dishonored when presented on October 23, 2009. Scherl testified that he did not receive payment or the return of these three vehicles.

Initial Argument on Motion for Judgment of Acquittal

At the end of the State's case-in-chief, defense counsel generally argued that there was insufficient evidence of identification of who was responsible for drafting the bad checks in this case. The court ruled that there was sufficient evidence of appellant's involvement in the business and denied the motion.

The court then went through the charged counts individually, but we address only the counts for which the jury returned convictions. As to Count 10, concerning the Mazda, after the State argued that there was testimony that appellant signed the check, the court denied the motion. On Count 12, the Pontiac, defense counsel conceded that appellant signed the check, and the court denied the motion. Defense counsel made no specific argument on either Count 14, the Saturn, or Count 16, the Nissan, and the court denied the motions.

As for the replacement checks for the three remaining vehicles, on Count 18, the Honda, and on Count 22, the Ford, defense counsel made no additional argument, and the court denied the motions. As for Count 24, the Dodge, defense counsel simply noted that the court had granted the motion for the count charging uttering a bad check initially from the Talbot account, and the court then denied the motion for the count concerning issuance of the replacement check for this vehicle. No further argument was made on the motions at the end of the State's case-in-chief.

Defense Case

Pertinent to our discussion, Carol Northcut was an employee of Rokabil and knew that Scherl was a wholesaler that provided cars for Rokabil to sell. Northcut's understanding of the arrangement between Rokabil and Scherl was that "[Rokabil] Motors would give Ed Scherl a check for whatever car that we had sold and Ed was supposed to hold the check until he was given an okay by either Kirk [Albertson] or Bill [Haddaway]." Sometimes Scherl would call and ask Northcut to ask appellant whether he could cash certain checks. Northcut denied that she ever signed checks to Scherl, and testified that appellant kept the books and the checkbook register.

Northcut further explained that Rokabil used a bank called Credit Acceptance Corporation ("CAC") to help customers finance the purchase of vehicles provided by Scherl. When a customer obtained a loan for a vehicle, CAC paid Rokabil a certain percentage of the loan amount. Northcut then testified that, after a vehicle was sold, Scherl would sign over the title to an employee of Rokabil.

On cross-examination, Northcut provided further details, testifying that Scherl was the only person providing cars for resale to Rokabil. Scherl would pass title to Rokabil, and then Rokabil would retitle the car to the individual purchaser. With respect to the manner in which Scherl was to be paid, Northcut then testified that she "knew it was fact that Mr. Scherl was supposed to hold the checks." Northcut confirmed that appellant signed the seven checks at issue in this appeal.

On redirect examination, Northcut maintained that Scherl was supposed to hold the checks, explaining that "on some of the cars it was because we were waiting for funding from the bank." Northcut testified that when funding came through, she would inform appellant. She also indicated that there was "no set system for when we gave [Scherl] a check, " and that appellant and Haddaway were the only ones who could sign a check to Scherl. Northcut concluded by testifying that Scherl was given a check "about 50 to 60 percent of the time" on the same day he delivered title.

Appellant testified on his own behalf and explained the arrangement between Rokabil and Scherl as follows:

We did discuss a business deal. Ed Scherl was going to provide us with as many cars as we needed, which I believe he said the number would be 40, which would keep our lot full all the time. When we sold a car he would give us a title and we would pay for the car. Bill and I both explained to Ed Scherl that our dealership was not in a position to pay cash, as would be known as cash at the time we sold the car. We would have to wait for a few other actions to transpire before we could pay the car off. Ed Scherl said that that wouldn't be a problem. Just give me a check and I will hold it and when you had enough money to make that check good I would go to the bank and deposit that check. I reiterated with Ed Scherl that I felt a little uncomfortable with writing a check that he would hold. Ed Scherl promised us and assured us that he would not present the check to the bank unless we approved that check to be presented to the bank. He would hold it until we had the money to cover the check.

Appellant explained that the reason Rokabil did not have the money to pay for the car immediately was due to the fact that many of their customers had poor credit. Because of the need for these customers to obtain financing, Rokabil would often not be paid by CAC until 15 to 30 days after the sale. Rokabil received hold checks and promissory notes from its customers as down payment for the sale of the vehicles. Appellant testified that Scherl was aware of this relationship with CAC and knew that it sometimes took between several weeks and a month before Rokabil would receive money for the sale of the vehicles. Appellant further testified that Scherl had been in the car business for over thirty years and was very familiar with the process of collecting money from CAC. Scherl was the only wholesaler that Rokabil worked with. Appellant agreed that he would sign checks to Scherl on occasion.

Appellant further explained that, after a sale, it could take anywhere between three to five days and 45 to 90 days before Rokabil received payment from the customer or CAC. At some point in October 2009, this delay began to bother Scherl. Appellant testified that some of the sales were problematic and that Rokabil could not make those checks to Scherl good. After explaining this problem to Scherl, Scherl decided to have a tow truck come to Rokabil's lot in order to remove his vehicles from the premises.

On cross-examination, appellant agreed that he had signing authority for the checks to Scherl, and that he, appellant, had access to the checking account balance. He also confirmed that he signed all the checks at issue in this case, except for check number 2568, the one for $2, 675.00 for a Mazda Protege. As for the hold check agreement, appellant asserted that Scherl had "a very disorganized way of doing things." Appellant claimed that he would tell Scherl certain checks could be cashed, and that Scherl, at times, would cash different checks.

Appellant also explained the process of how customers obtained financing from CAC. Starting with the premise that "[e]veryone is approved, " Rokabil would forward all the pertinent information to CAC regarding a car sale, and that CAC would then decide how much money it would advance to Rokabil for said vehicle. CAC would hold the balance on the sale until it received payment from the customer on the loan. After a certain period, CAC would pay Rokabil any balance due.

Appellant clarified that Scherl would bring cars to the lot and tell appellant how much he expected to be paid for that car. Rokabil would then try to sell the car to a customer for a profit. Appellant explained that, after the customer put down a down payment and drove the car off the lot, the financing company, CAC, occasionally would not pay the entire amount due for the car up front. Rokabil would be paid eventually as the customer paid down the loan. Appellant agreed, however, that CAC paid Rokabil the full cost of the vehicle most of the time. Appellant maintained that the agreement between Rokabil and Scherl was that Scherl would have to wait a period of time to be paid after he delivered title for the cars, although he confirmed that they did not repeat the terms of that agreement on each transfer.

Upon further cross-examination, appellant testified about the nature of the agreement as follows:

Q. When you wrote and issued those checks and gave them to Mr. Scherl did you know there wasn't enough money in the bank to cover them?
A. No, sir.
Q. You didn't know?
A. That wasn't part of the deal.
Q. Well . . .
A. We agreed that these checks would not have been cashed.
Q. Because there wasn't enough money in the bank to cover them?
A. No. That wasn't our agreement.
Q. But listen to the actual question. When you wrote the check . . .
A. Well I understand what you're trying to get me to say but I can't . . .
BY THE COURT:
Q. Well, sir, sir, wait a minute. Just listen to his question.
BY [PROSECUTOR]:
Q. When you wrote the check was there [sic], I understand that you wanted him to cash it later, but was there enough money in the bank when you wrote the check to cover the check?
A. I don't know.
Q. You don't know?
A. Because I didn't look at the bank account because those checks weren't supposed to be cashed on that day.
Q. Was there ever enough money in the bank to cover those checks?
A. Yes.
Q. When?
A. If some weren't cashed for 30 days there was a fluctuation at time where our checking account was up and down.
Q. Were you out of business by then?
A. No, we didn't go out of business until Ed took all the cars off the lot.
Q. When was that?
A. I believe that was October 24th or October 25th.

Appellant did not know if there was enough money in the Talbot bank account to cover the checks written on September 28, 2009. He also admitted that the high balance in the bank during October was $3, 263.00. With respect to the replacement checks written on the Queenstown Bank, replacing checks for three different vehicles, appellant agreed that his partner, Haddaway, opened that account with a $75.00 deposit. Appellant confirmed that he never deposited enough money in the Queenstown Bank to cover the three replacement checks. While admitting he wrote the three checks at issue, appellant claimed he did not order stop payment on those checks. Appellant agreed that Scherl was never paid on the seven cars, and that Rokabil did not return the cars in question. Apparently, the Motor Vehicle Administration ("MVA") eventually required Scherl to pass title to the disputed cars to the owners. Appellant testified that was between the MVA and Scherl. Appellant also agreed that, after Rokabil went out of business, he never paid Scherl any money due on the seven checks.

On redirect examination, appellant testified that it was not his "intent to cheat Ed out of any money, none whatsoever. As a matter of fact Ed was our sole source of being in business." While he did not always check the bank account balance before signing a check, appellant maintained that the agreement with Scherl called for Scherl to "not cash those checks for a period of time." Further, appellant testified that "[t]his whole thing was Ed's idea. It wasn't our idea to write checks and then to hold them." And, "Ed Scherl came up with the idea that if you can't afford to pay for the cars when I give you the titles I'll go ahead and take the hold check."

On recross, appellant admitted that Rokabil had bills due to entities in addition to Scherl. After the prosecutor asked whether there might not be enough money available if other creditors cashed their checks before Scherl on any given day, appellant replied that he was "unaware of that."

State's Rebuttal

The State called Scherl in rebuttal and asked him about the purported hold-check agreement. Scherl testified as follows:

A. There were a couple of occasions where they had asked to hold the check up because of funding. Some of it, they were all different. Some were cash deals, the checks were good right away. There were some deals that were done on local banks, they actually walked the contracts through and got the check from the local banks. So they were fairly quick. And then there were some that went through other lenders that took a week or 10 days to be funded and they would ask for time on those checks.
Q. And did you give them that time?
A. I did.
Q. Now with regard to the checks that are involved today with Mr. Albertson do you recall whether any of those you were asked to wait or not?
A. I can't recall honestly.

Scherl also testified that he did not believe that any of the seven cars involved in this case were ones that became a matter of dispute with the MVA. He agreed, on cross- examination, that he was paid for the majority of the vehicles he delivered that were sold by Rokabil.

Defense Surrebuttal

Appellant testified that he never delivered checks to Scherl that were meant to be cashed ...


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