Posted 3/17/2016

In People v. North River Insurance Co., 2016 WL 890120 (Cal.App. March 9, 2016), the surety appealed the trial court’s denial of a motion to vacate the forfeiture and exonerate the bond.  It also appealed the summary judgment entered against the surety on the bond.  The Court of Appeal affirmed the denial.  The defendant was arrested on various charges and the surety posted bond in the amount of $75,000.  Subsequently, the defendant and the State entered into a plea agreement, which included a nine-year stipulated sentence.  At the plea hearing, the defendant agreed to a sentencing date that was about a month later than established by law.  After the defendant failed to appear for sentencing, the trial court ordered the bond forfeited.  In a motion to vacate the forfeiture and exonerate the bond that was brought by the bail agent, the agent argued that the plea agreement containing the nine-year sentence and the continuance of the sentencing hearing beyond the time set by law modified the bond contract and materially increased the surety’s risk.  The trial court found no material increase in the surety’s risk and denied the motion to vacate the forfeiture and exonerate the bond.  It also granted summary judgement against the surety on the bond forfeiture.  As an initial matter, the Court of Appeal addressed certain jurisdictional issues, sua sponte.  It held that, although the motion to vacate was brought solely by the bail agent, the surety is aggrieved by the denial and therefore is a proper party on the appeal.  However, summary judgement against a surety on a bail bond is not appealable.  The Court dismissed the appeal of the summary judgment.  As to the denial of the motion to vacate the forfeiture and exonerate the bond, the Court of Appeal held that the statutorily established time for sentencing may be waived.  Therefore, assuming the law establishing the timing for sentencing is incorporated into the bond, a continuance does not violate or is contrary to that law.  A continuance did not modify the terms of the bond contract or increase the surety’s risk.  With respect to the nine-year sentence in the plea agreement, the Court of Appeal rejected the argument that the stipulation of the nine-year sentence would make it less likely that the defendant would appear at sentencing, considering that the defendant faced a potential sentence of 25 years. 

Rodriguez v. Speedy Bail Bonds, 2016 WL 8899999 (D.P.R. February 17, 2016) involves a complaint against a bail agent for false imprisonment and negligence and a counterclaim for breach of contract.  After several continuances and delays in the discovery schedule, largely due to the plaintiff’s incarceration subsequent to bringing the action, the bail agent moved to dismiss for failure to prosecute and failure to comply with discovery.  The Magistrate Judge stated that because the dismissal motion is premised on the plaintiff’s failure to comply with discovery requests, the applicable rule to obtain relief is Fed.R.Civ.P. Rule 37 and not Rule 41.  Under Rule 37, a condition precedent to a motion to dismiss is that the movant must move for a discovery order.  The Magistrate Judge noted that the bail agent had not done so.  Further the Magistrate Judge stated that there was no prejudice to warrant dismissal under Rule 41 for failure to prosecute. Therefore, the motion to dismiss is denied.

In State v. Perez (Ohio App. March 4, 2016), the defendant was indicted on drug charges and the surety issued a $25,000 bond.  The defendant failed to appear at a pretrial hearing and the trial court ordered the bond forfeited.  Two days later, the defendant was found in Florida and arrested by U.S. Marshals.  The surety filed a motion for remittal of the surety bond.  In considering the factors in a request for remittal (the circumstances of the defendant’s reappearance, the reason for the failure to appear, prejudice to the prosecution, whether the surety took part in the capture, mitigating circumstances and the interest of justice), the trial court denied the motion.  The trial court found that the re-apprehension occurred without significant assistance from the surety and the state was prejudiced because warrants were issued and court dates were missed.  The Court of Appeal affirmed the denial of the remittal motion finding that the trial court did not abuse its discretion.

In People v. Financial Casualty & Surety, Inc., Case No. E062081 (Cal.App. March 1, 2016), the surety appealed the trial court’s denial of its motion to vacate a bail forfeiture.  The defendant failed to appear at a felony settlement conference.  The trial court declared the $25,000 bond forfeited.  In its motion to vacate, the surety argued that the defendant was not lawfully required to be present at the settlement conference (as set forth in the bail forfeiture provision of Penal Code section 1305(a)).  The State argued that the defendant was lawfully required to be present by operation of Penal Code section 977 and because the court ordered the defended to be present.  The trial court based its denial of the motion to vacate on the grounds that the court specifically ordered the defendant to be present.  However, it expressed the opinion that section 977 required a defendant to be present at a felony settlement conference.  The Court of Appeal held that the recent California Supreme Court decision of People v. Safety National Casualty Corp., 62 Cal.4th 703 (2016) settled the issue.  In Safety National, the Supreme Court held that section 977(b)(1)’s requirement of personal presence at “all other proceedings” gives rise to the “lawfully required” appearance requirement under section 1305(a).  The Court of Appeal held that the trial court properly forfeited the bond. [Not Published]

Morrissey v. 4 Aces Bail Bonds, 2016 WL 853841 (Md.App. March 2, 2016) involved the District Court’s retroactive application of a Maryland statute regarding bail forfeitures.  A surety adversely affected by the retroactive application brought a writ of mandamus, an injunction and a declaratory judgment.  The Circuit Court granted the District Court’s motion to dismiss.  The Court of Special Appeals affirmed the dismissal. 

Under Md. Rule 4-217, a surety that is in default and has failed to pay a bail forfeiture for a period of 60 days must be placed on a list of sureties that may not furnish bonds to the court.  Prior to a statutory change in 2011, the District Court struck a forfeiture if the defendant appeared in court (whether or not the surety paid), even after the appearance period expired.  Therefore, prior to the statutory change, a surety that had not paid a forfeiture was never placed on the list because there was the possibility that the forfeiture could be struck if the defendant subsequently appeared.  In 2011, the General Assembly amended the Criminal Procedure Article (CP § 5-208) to state that a surety must have paid the bail forfeiture in order for the court to strike the forfeiture.  The District Court did not change its practices or the applicable rules until 2013.  In 2013, Md. Rule 4-217 was amended to be consistent with the statutory change and the District Court advised all sureties that since 2011, it had been striking forfeitures upon the mere appearance of the defendant, even without having received payment from the surety.  It advised sureties with such unpaid forfeitures (from 2011 to 2013) that they will be deemed in default.  The surety in this case had several unpaid forfeitures.

The Court of Special Appeals examined the statutory and regulatory language, their purpose and the legislative history.  It concluded that the statute and regulation clearly establish payment of a bond forfeiture as a condition to having a forfeiture struck.  Further, the fact that the regulation and the District Court’s practice were inconsistent with the statute is an unavailing argument.  It held that the 2011 statute prevails over any inconsistent regulation or practice.  In response to the surety’s claim that the retroactive application of the statute denied it of its right to procedural due process, the Court of Special Appeals held that the surety was not deprived of its property interest because the District Court acted without actual authority when it struck forfeitures for which there was no surety payment.  Such acts were void.  Further the District Court’s compliance with the statute (CP 5-208), albeit delayed, was sufficient to satisfy procedural due process.  Moreover, the Court stated that equitable estoppel does not apply because the surety cannot rely on acts of the District Court that exceeded its actual authority.  The Court concluded that the District Court’s actions in “reversing” the striking of forfeitures were consistent with law. 

In State v. Solomon, 2016 WL 700621 (W.Va. February 19, 2016), the defendant appealed his conviction for misdemeanor brandishing by the Magistrate Court.  His criminal appeal bond was set at $2,500.  The defendant failed to appear for his Circuit Court trial and the court ordered that his bond be forfeited.  However, in its order, the Circuit Court stated that the bond was in the amount of $21,000.  The Circuit Court also affirmed the conviction.  The defendant appealed his conviction and the forfeiture to the West Virginia Supreme Court.  With respect to the forfeiture issue, the defendant argued that a motion by the State is required before a circuit court can declare a bond forfeited.  In an unpublished memorandum opinion, the Supreme Court disagreed.  The Court held that pursuant to Rule 46(e)(1) of the Rules of Criminal Procedure, no motion for the forfeiture of the bond is necessary.  The only prerequisite is that the defendant breach the conditions of the bond.  Noting that the defendant failed to appear, the Court affirmed the forfeiture of the bond.  It also held that the Circuit Court erred with respect to the amount and ordered a correction of the forfeiture order to reflect the correct amount.

In People v. North River Insurance Co, Case No. B258052 (Cal.App. February 25, 2016), the surety appealed the trial court’s denial of a motion to set aside a summary judgment ordering a bail forfeiture.  The surety had provided a $75,000 bail bond to the defendant, who failed to appear.  The trial court declared the bond forfeited.  At the end of the initial 185 day appearance period, the trial court granted a series of extensions totaling 378 days.  On March 19, 2014, the trial court denied a motion for another extension and then ordered “summary judgment to issue forthwith.”  Later the same day, another judge charged with entering all summary judgments on forfeited bail bonds entered summary judgment against the surety in this case.  The surety moved to set aside the summary judgment arguing that the court’s oral order denying the motion to extend the appearance period was not a final decision, and therefore summary judgment was premature.  The surety maintained that there is no final decision until there is a written order.  The trial court denied the motion to set aside the summary judgment, apparently relying on the judge’s handwritten notes in the file as a written order.  The Court of Appeal held that the trial court was not premature, but actually entered summary judgment late.  The Court of Appeal held that by statute, any extensions are limited to 180 days in total.  Thus, the appearance period, with extensions, elapsed on January 19, 2013.  Pursuant to statute, summary judgment should have been entered 90 days after this date.  Failure to do so, typically results in exoneration of the bond.  However, the Court of Appeal held that the surety was estopped from benefitting from the trial court’s error when its own affirmative conduct (moving for a series of extensions) caused the court to erroneously extend the appearance period.  [Not Published]

In People v. North River Insurance Co., 2016 WL 890120 (Cal.App. March 9, 2016), the surety appealed the trial court’s denial of a motion to vacate the forfeiture and exonerate the bond.  It also appealed the summary judgment entered against the surety on the bond.  The Court of Appeal affirmed the denial.  The defendant was arrested on various charges and the surety posted bond in the amount of $75,000.  Subsequently, the defendant and the State entered into a plea agreement, which included a nine-year stipulated sentence.  At the plea hearing, the defendant agreed to a sentencing date that was about a month later than established by law.  After the defendant failed to appear for sentencing, the trial court ordered the bond forfeited.  In a motion to vacate the forfeiture and exonerate the bond that was brought by the bail agent, the agent argued that the plea agreement containing the nine-year sentence and the continuance of the sentencing hearing beyond the time set by law modified the bond contract and materially increased the surety’s risk.  The trial court found no material increase in the surety’s risk and denied the motion to vacate the forfeiture and exonerate the bond.  It also granted summary judgement against the surety on the bond forfeiture.  As an initial matter, the Court of Appeal addressed certain jurisdictional issues, sua sponte.  It held that, although the motion to vacate was brought solely by the bail agent, the surety is aggrieved by the denial and therefore is a proper party on the appeal.  However, summary judgement against a surety on a bail bond is not appealable.  The Court dismissed the appeal of the summary judgment.  As to the denial of the motion to vacate the forfeiture and exonerate the bond, the Court of Appeal held that the statutorily established time for sentencing may be waived.  Therefore, assuming the law establishing the timing for sentencing is incorporated into the bond, a continuance does not violate or is contrary to that law.  A continuance did not modify the terms of the bond contract or increase the surety’s risk.  With respect to the nine-year sentence in the plea agreement, the Court of Appeal rejected the argument that the stipulation of the nine-year sentence would make it less likely that the defendant would appear at sentencing, considering that the defendant faced a potential sentence of 25 years. 

Rodriguez v. Speedy Bail Bonds, 2016 WL 8899999 (D.P.R. February 17, 2016) involves a complaint against a bail agent for false imprisonment and negligence and a counterclaim for breach of contract.  After several continuances and delays in the discovery schedule, largely due to the plaintiff’s incarceration subsequent to bringing the action, the bail agent moved to dismiss for failure to prosecute and failure to comply with discovery.  The Magistrate Judge stated that because the dismissal motion is premised on the plaintiff’s failure to comply with discovery requests, the applicable rule to obtain relief is Fed.R.Civ.P. Rule 37 and not Rule 41.  Under Rule 37, a condition precedent to a motion to dismiss is that the movant must move for a discovery order.  The Magistrate Judge noted that the bail agent had not done so.  Further the Magistrate Judge stated that there was no prejudice to warrant dismissal under Rule 41 for failure to prosecute. Therefore, the motion to dismiss is denied.

In Calvert Bail Bond Agency, Inc. v. County of St. Clair, 2016 WL 918357 (Mich.App. March 10, 2016), the surety appealed a number of bail forfeitures.  The surety became surety for various criminal defendants and the defendants failed to appear.  In all cases, the surety paid the forfeiture more than 56 days after the entry of the judgment, and, in most cases, the defendant was brought into custody more than 56 days after the entry of the judgment.  The surety sought recovery of the funds it paid in district court under MCL 765.28.  This statute provides for the recovery of funds, but the surety must have paid the forfeiture within 56 days of the entry of the judgment.  Because the surety did not do so, the district court held that the surety was not entitled to relief under MCL 765.28.  The surety then sought recovery in circuit court under MCL 600.4835, which permits the circuit court to remit any penalty, including “forfeitures and forfeited recognizances.”  The circuit court found no cause of action because it determined that the sole remedy for the return of bail forfeitures was under MCL 765.28.  The Court of Appeals held that MCL 765.28 was not the exclusive remedy.  Both statutes provide for bail forfeitures.  The difference is that the surety is entitled to a return of a bail forfeiture under MCL 765.28, and the court has discretion in determining whether to return the bail forfeiture under MCL 600.4835.  The court noted that when MCL 765.28 was enacted, the legislature did not include any express language stating that the provision was the exclusive remedy for sureties.  The Court of Appeals remanded the case to the trial court to determine if there is good cause to provide relief to the surety under MCL 600.4835.

In United States v. Johnson, et al., 2016 WL 930947 (E.D.La. March 11, 2016), a bail agent and others were accused of mail fraud, wire fraud and other crimes in connection with their bail agency business.  With respect to the mail fraud count, the U.S. alleged that the defendant was not licensed by the Louisiana Department of Insurance and did not have an appointment from the insurance company to sign bonds on its behalf.  The complaint alleged that the defendant signed bonds under his employees’ names who were licensed and did have company appointments.  In its complaint, the U.S. referenced the fact that the bail agency was required to send back to the insurance company copies of the powers of attorney used, premiums reports, bond discharge reports and forfeiture reports.  The complaint also included a bribery scheme whereby the defendant bribed officials within the magistrate court’s office in exchange for bonds pre-signed by the clerk and for lowering the bail amount.  The defendant moved to dismiss the mail fraud count because the object of the alleged scheme (release of inmates) was completed prior to the mailings.  Thus, the mailings were not sufficiently closely relating to the scheme.  The court disagreed.  It held that the thing mailed merely had to be an integral part of the scheme.  The court held that it was critical to the defendant’s scheme that copies of powers of attorney continued to be returned to the insurance company in order to be able to sign for more bonds in the future.  The defendant moved to dismiss the bribery count (honest services fraud), arguing that actions alleged in this count did not violate state laws.  The court disagreed and stated that with respect to honest services fraud, there is no requirement that the actions taken by public officials in exchange for kickbacks be a violation of state law.  It is sufficient to allege only that a public official accepted something of value in return for being influenced in the performance of his official act.  The court denied the motion to dismiss. 

In People v. Financial Casualty & Surety, Inc., 2016 WL 946290 (Cal.App. March 14, 2016), the surety appealed the trial court’s denial of its motion to vacate a forfeiture.  The surety had posted a bond to release the defendant from custody.  The minute order following the arraignment stated that the defendant was “ordered to appear” at a felony readiness hearing.  The defendant failed to appear at the hearing and the court ordered the bond forfeited.  In its motion to vacate the forfeiture, the surety argued that the readiness hearing was not a hearing at which the defendant was lawfully required to appear pursuant to the forfeiture statutes (Penal Code § 1305).  The Court of Appeal affirmed the denial of the motion to vacate.  It held that the recent decision in People v. Safety National Casualty Corp, 62 Cal.4th 703 (2016), controlled.  As in Safety National, the defendant had specific notice of the felony readiness hearing, did not execute a waiver of his right to be present and failed to appear without sufficient excuse.  His nonappearance at the readiness hearing was an adequate basis to forfeit the bond.  [Not Published]