U.S. v. Fair ( 1992 )

UNITED STATES COURT OF APPEALS
for the Fifth Circuit
_____________________________________
No. 92-2098
_____________________________________
UNITES STATES OF AMERICA,
Plaintiff-Appellee,
VERSUS
MARION EUGENE FAIR,
Defendant-Appellant.
______________________________________________________
Appeal from the United States District Court
for the Southern District of Texas
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(December 9, 1992)
Before KING, JOHNSON, and DUHÉ, Circuit Judges.
DUHÉ, Circuit Judge:
Marion Eugene Fair ("Fair") appeals his conviction and
sentence. Fair was found guilty of the unlawful possession by a
previously convicted felon of a firearm that was shipped in
interstate commerce. See 18 U.S.C. § 922(g)(1) (Supp. 1992). The
district court sentenced him to 293 months incarceration, and
imposed a $20,000 fine. Fair challenges his conviction claiming
that certain evidence was improperly admitted. We find no error in
the district court's conduct of the trial, and affirm Fair's
conviction.
Fair also challenges the fine imposed upon him. We find that
the district court misapplied the relevant sentencing guidelines.
That part of the judgment imposing the fine is vacated and the case
remanded to the district court for resentencing.
Federal and state drug agents executed a search warrant on a
house trailer. In one of the bedrooms the agents found two
handguns and some documents which indicated that the bedroom was
used by Fair. Fair was later indicted, convicted, and sentenced.
Without objection from Fair, the district court adopted the
facts in his presentence investigative report (PSR). It stated
that:
[Fair's] only assets are two old junk automobiles worth
approximately $1,000.00. He stated he had no liabilities
and his only income is about $50.00 per month he receives
from family and friends. Prior to his incarceration in
the instant case, he was only sporadically employed and
has held no real stable employment for a number of years.
Since he has been incarcerated most of his adult life, he
does not appear to have any realistic ability to pay a
fine within the guideline range.
Although no reasons were contemporaneously given for imposing the
$20,000 fine, in a supplemental sentencing memorandum the district
court stated: "The fine assessed was intended by the court to
represent a small portion of the defendant's cost of imprisonment
pursuant to guideline § 5E1.2(i)."1 The supplemental memorandum
also noted that the court did consider the PSR's statement
regarding Appellant's current inability to pay such a fine. The
1
U.S.S.G. § 5E1.2(i) states:
Notwithstanding of the provisions of subsection (c) of
this section [minimum-maximum fine range], but subject to
the provisions of subsection (f) herein [defendant's
ability to pay], the court shall impose an additional
fine amount that is at least sufficient to pay the costs
to the government of any imprisonment, probation, or
supervised release ordered.
(emphasis added).
2
court stated that a payment schedule could be worked out which
would enable Fair to pay off his fine after his release.
Fair challenges the trial court's decision to admit some of
the documents discovered during the search of the house trailer.2
Defense counsel objected to these documents on a relevancy basis,
contending that since Fair stipulated to being a convicted felon,
the TDC documents and the letter from the Texas Court of Appeals
were merely cumulative. The government argued that the documents
were addressed to Fair, and tended to prove that he occupied the
bedroom, and hence, constructively possessed the firearms. The
court admitted the documents and gave a limiting instruction
admonishing the jury to consider the documents only for the
purposes of establishing possession of the guns.
Fair also challenges the imposition of the $20,000 fine,
mounting a two-pronged attack: First, Fair asserts that it was
error to impose a fine after adopting the PSR which indicated that
he did not have the ability to pay any fine. Second, Fair argues
that the imposition of a § 5E1.2(i) cost of incarceration fine was
2
Fair objected to government's exhibits 9 through 15. Exhibit 9
is a letter from the Texas Department of Corrections (TDC) Staff
Counsel for Inmates, and it discusses a possible appeal. Exhibit
10 is a memorandum from the TDC regarding prison work assignments.
Exhibit 11 is a form letter denying a furlough request. This
exhibit contains perhaps the most prejudicial material; one of the
reasons checked for denial is "Inmate is a security risk and/or a
threat to society for one or more of the following reasons[.]"
Items checked are: (1) Length of sentence; (2) Lack of sufficient
time served on sentence; and, (3) prior criminal history. Exhibit
12 is a letter from the Texas Court of Appeals acknowledging a
prior communication from Fair, and Exhibit 13 is the envelope this
came in. Exhibit 14 is a handwritten letter from Fair's sister,
and Exhibit 15 is a parole certificate from the TDC.
3
a misapplication of the sentencing guidelines, as the trial court
did not impose an initial § 5E1.2(a) punitive fine.
DISCUSSION
A. The Admission of the Documents.
At trial, Fair objected to the relevancy of some of the
documents discovered during the search. He appears to concede the
relevancy of these documents in his appellate arguments, and now
contends that the district court erred in not performing a Beechum-
type weighing of their prejudicial impact. See United States v.
Beechum, 582 F.2d 898 (5th Cir. 1978), cert. denied, 440 U.S. 920(1979).
Fair correctly cites Beechum for the proposition that where
evidence of "other offenses" is offered, the trial court must first
decide that the proffered material is relevant, and then weigh its
probative value against any prejudicial effect. Id. at 911 (citing
Fed. R. Evid. 403, 404(b)). What Fair overlooks, however, is that
to engage in this type of balancing, a court's attention must be
first directed to the issue. The unfair prejudice argument is
being raised for the first time on appeal. We therefore apply a
plain error standard of review. Fed. R. Crim. P. 52(b); United
States v. Loney, 959 F.2d 1332, 1341 (5th Cir. 1992). Our inquiry
is limited under this standard: "[W]hen a new factual or legal
issue is raised for the first time on appeal, plain error occurs
where our failure to consider the question results in 'manifest
injustice.'" United States v. Vontsteen, 950 F.2d 1086, 1096 (5th
4
Cir. 1992) (en banc).
Viewing the issue in the context of the entire case, see id.,we cannot say that admission of the documents, if error, amounts to
manifest injustice. Fair maintained that he did not possess the
firearms, as required for a violation of 18 U.S.C. § 922(g)(1).
The documents Fair objected to were introduced to show that Fair
did reside in the house trailer, and that he therefore exercised
constructive possession of the weapons. Although other evidence
was introduced on this point, we cannot say that the trial court
committed plain error in allowing further proof on the possession
element.
B. Sentencing Issues.
1. Standard of Review.
We examine the sentence to ascertain if it was imposed in
violation of law, as a result of a misapplication of the sentencing
guidelines, or if it was outside of the guideline range and was
unreasonable. See 18 U.S.C. § 3742(e) (Supp. 1992). Findings of
fact are accepted if they are not clearly erroneous. Id.; United
States v. Matovsky, 935 F.2d 719, 721 (5th Cir. 1991).
2. Fair's Ability to Pay the Fine Imposed.
The district court adopted the PSR, which recommended against
imposing a fine. The PSR justified this by stating:
The defendant does not appear to have any assets which
could be liquidated to pay fine [sic] immediately, nor
does he appear to have the means to pay a fine on an
installment basis after a lengthy period of
incarceration.
At his sentencing, neither Fair nor the government objected to the
5
PSR, the sentence imposed, or the imposition of the $20,000 fine.
In a supplemental sentencing memorandum, the district court
reaffirmed the fine, and indicated that Fair's present indigency
was considered; however, the court stated that Fair could pay off
the fine in monthly installments after his release. See R. 1, at
193.
District courts are directed to impose a fine in all cases,
unless the defendant establishes that he will be unable to pay.
U.S.S.G. § 5E1.2(a). In determining the fine, the guidelines list
seven factors for consideration, including "any evidence presented
as to the defendant's ability to pay the fine (including the
ability to pay over a period of time) in light of his earning
capacity and financial resources[.]" Id. § 5E1.2(d)(2). Because
of the mandatory language of § 5E1.2(d) ("[T]he court shall
consider. . . . "), some circuits require that trial courts make
specific findings showing they properly considered the pertinent
factors in determining the fine amount. See, e.g., United States
v. Masters, 924 F.2d 1362, 1369 (7th Cir. 1991), cert. denied, 111
S. Ct. 2019 (1992); United States v. Seminole, 882 F.2d 441, 443
(9th Cir. 1989). We have declined to impose this requirement, as
there is no statutory or sentencing guideline intimation that such
detailed findings are necessary. United States v. Matovsky, 935
F.2d 719, 722 (5th Cir. 1991); see discussion at note 3, infra.
But see United States v. Pattan, 931 F.2d 1035, 1044 (5th Cir.
1991), cert. denied, 112 S. Ct. 2308 (1992) (sentencing court erred
in not explaining decision to impose cost of incarceration fine in
6
light of PSR's recommendation that this would impose severe
hardship on defendant's family).
A brief digression is necessary to analyze the apparent
divergent views espoused in Matovsky and Pattan. In Matovsky, the
district court adopted the PSR which made no recommendation on
imposing a fine. See 935 F.2d at 722. We held that it was not
error for the court to impose a fine within the guideline range
without making specific findings on Matovsky's ability to pay. Id.The trial court in Pattan likewise adopted the PSR, but this report
recommended that neither a fine nor the cost of incarceration be
imposed on the defendant. See 931 F.2d at 1038. On appeal, we
held that "The only evidence we can find, that in the presentence
report, does not support the decision of the trial court. . . ."
Id. at 1044. Reading Matovsky and Pattan together, we can distill
the rule that specific findings are necessary if the court adopts
a PSR's findings, but then decides to depart from the PSR's
recommendation on fines or cost of incarceration.3
The necessity for such explanation is illustrated by this
case. Fair's PSR points out that he has limited future earning
3
A sentencing court is required, under certain circumstances, to
give a statement of reasons for imposing a sentence. See 18 U.S.C.
§ 3553(c) (Supp. 1992); United States v. Pippin, 903 F.2d 1478,
1484-85 (11th Cir. 1990) (if applicable guideline range is greater
than twenty-four months, court must provide reasons for imposing
sentence at a particular point within this range). There is no
statutory counterpart requiring articulated reasons for imposing
a fine on an individual. See, e.g., United States v. Marquez, 941
F.2d 60, 65 (2d Cir. 1991) ("Since the requirement of subsection
3553(c)(1) is triggered only by the length of the sentence and not
by the amount of the fine, the district court was under no special
obligation to justify the magnitude of this fine.").
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capacity, and little realistic chance of paying a large fine: Fair
has been incarcerated most of his adult life, he has minimal
education, and his work record is sporadic. Furthermore, Fair will
be sixty-six years old when he is released from his present
incarceration. Even with a monthly installment plan, we are hard
pressed to see how he will be able to pay off his $20,000 fine. On
remand, we urge the district court to consider these and the other
factors contained in Fair's PSR when determining whether it is
appropriate "to impose a fine that a defendant has little chance of
paying." United States v. Walker, 900 F.2d 1201, 1207 (8th Cir.
1990).
It is undisputed that the guidelines place the burden of
proving an inability to pay a fine squarely on the defendant. See
U.S.S.G. § 5E1.2(a), (f); United States v. Hagmann, 950 F.2d 175,
185 (5th Cir. 1991), cert. denied, 113 S. Ct. 108 (1992). If the
defendant makes such a showing, the court may impose a lesser fine,
or waive the fine altogether. U.S.S.G. § 5E1.2(f).
In Pattan, we held it was error for the district court to
adopt the PSR, and then depart from its recommendation on fines and
cost of incarceration, absent any reasons for such a departure.
See United States v. Pattan, 931 F.2d 1035, 1044 (5th Cir. 1991).
The only evidence before the court concerning Pattan's ability to
pay was the PSR. Id. We now take the step that we implicitly
relied on in Pattan, and hold that a defendant may rely on the PSR
to establish his inability to pay a fine or cost of incarceration.
This is not an anomalous position among the circuits. See, e.g.,
8
United States v. Rivera, 971 F.2d 876, 895 (2d Cir. 1992); United
States v. Cammisano, 917 F.2d 1057, 1064 (8th Cir. 1990); United
States v. Labat, 915 F.2d 603, 606 (10th Cir. 1990).
When a sentencing court adopts a PSR which recites facts
showing limited or no ability to pay a fine the government must
then come forward with evidence showing that a defendant can in
fact pay a fine before one can be imposed. See id.; United States
v. Walker, 900 F.2d 1201, 1206-07 & n.6 (8th Cir. 1990). For
example, the government can point to evidence of assets concealed
by the defendant,4 evidence of the future earning potential of the
defendant,5 and even evidence of the wealth of the defendant's
family.6 Once such a showing has been made, it is within the trial
court's discretion to consider the factors outlined in U.S.S.G. §
5E1.2(d), and determine if a fine should be applied, and if so, the
proper amount within the applicable guideline range. The trial
court should give its reasons for departing from the PSR's
recommendations on fines and costs of incarceration.
2. Cost of Incarceration Fine.
In the supplemental sentencing memorandum, the district court
explained that the $20,000 fine impose on Fair "was intended by the
Court to represent a small portion of the defendant's cost of
imprisonment pursuant to guideline § 5E1.2(i)." R. 1, at 193. The
4
See U.S.S.G. § 5E1.2, comment. (n. 6).
5
See U.S.S.G. § 5E1.2(d)(2).
6
See United States v. Fabregat, 902 F.2d 331, 334 (5th Cir.
1990).
9
full text of § 5E1.2(i) is quoted supra, in note 1; in pertinent
part this provision authorizes the sentencing court to impose "an
additional fine amount" to offset the cost of incarceration,
probation, or supervised release. U.S.S.G. § 5E1.2(i).
The plain language of this section indicates that a cost of
incarceration fine should only be imposed after a § 5E1.2(a)
punitive fine has been assessed. This is the interpretation other
circuits have adopted: "[F]undamental semantics dictates that a
subparagraph (i) fine cannot be 'additional,' unless it augments
another fine." United States v. Labat, 915 F.2d 603, 607 (10th
Cir. 1990); see also United States v. Corral, 964 F.2d 83, 84 (1st
Cir. 1992) ("[A] district court may not impose a duty to pay for
costs of incarceration or supervised release if the defendant is
indigent for purposes of a fine under Sentencing Guideline section
5E1.2(a).").
We find this reasoning persuasive, and hold that the
imposition of a cost of incarceration fine, U.S.S.G. § 5E1.2(i), is
not proper absent an initial punitive fine, Id. § 5E1.2(a). To
impose a cost recovery fine alone is a misapplication of the
sentencing guidelines. See Labat, 915 F.2d at 606-07. The trial
court in the instant case characterized Fair's $20,000 fine as a §
5E1.2(i) cost of incarceration fine, and did not delineate any
portion of it as a § 5E1.2(a) punitive fine. We must therefore
vacate the fine and remand the case for further consideration and
resentencing.
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CONCLUSION
We hold that a defendant can properly rely on his presentence
investigative report to establish that he is unable to pay a fine
or cost of incarceration if the district court adopts the report.
The government can present evidence to counter this showing. The
district court must then weigh the applicable guideline factors and
decide if a fine is then appropriate, and if so, what amount in the
appropriate guideline range is to be imposed. If the court has
adopted a presentence report that recommended not imposing a fine,
the court must also articulate the reasons why it is departing from
the report. We further hold that it is a misapplication of the
guidelines to impose an "additional" cost of incarceration fine
absent an initial punitive fine.
We VACATE Fair's $20,000 fine and REMAND this case for further
consideration. Fair's conviction and sentence of incarceration are
otherwise AFFIRMED.
11