State of Missouri v. Cale D. Seymour , 570 S.W.3d 638 ( 2019 )

In the
Missouri Court of Appeals
Western District
STATE OF MISSOURI, )
)
Appellant, ) WD81570
)
v. ) OPINION FILED: March 26, 2019
)
CALE D. SEYMOUR, )
)
Respondent. )
Appeal from the Circuit Court of Johnson County, Missouri
The Honorable Sue Dodson, Judge
Before Division One: Cynthia L. Martin, Presiding Judge, Thomas H. Newton, Judge
and Gary D. Witt, Judge
The State appeals the trial court's grant of a motion for judgment of acquittal in a
case charging Cale Seymour ("Seymour") with the misdemeanor of failing to insure
workers' compensation liability in violation of section 287.128.7.1 The judgment of
acquittal was entered at the close of the State's evidence, and was based solely on the trial
court's finding that the charged violation was time-barred pursuant to section 287.128.11
1
All statutory references are to RSMo 2000, as supplemented through the offending period of August 2011
through October 2013, unless otherwise noted.
because it was filed more than three years after the discovery of Seymour's offense.
Because the charge against Seymour was filed more than three years after the discovery of
his offense, we affirm.
Factual and Procedural Background
On February 3, 2014, the Missouri Department of Labor and Industrial Relations,
Division of Workers' Compensation, Fraud and Noncompliance Unit (the "Fraud and
Noncompliance Unit") received a referral, and began investigating Cale Seymour
Construction, LLC ("Company") to determine whether it had failed to insure workers'
compensation liability in violation of section 287.128.7. The Company was in the
construction business. By law, it was required to maintain workers' compensation
insurance at any time it had at least one employee.2
Through database searches conducted on February 3, 2014, a Fraud and
Noncompliance Unit investigator discovered that Seymour was the organizer of the
Company; that the Company was formed on December 30, 2005; that the Company had
workers' compensation insurance nearly continuously from the time it was formed until
August 3, 2011; that the Company did not appear to have workers' compensation insurance
from August 3, 2011 through October 3, 2013; that the Company did have workers'
compensation insurance after October 3, 2013; and that between August 3, 2011 through
October 3, 2013, the Company reported having one or more employees in some quarters,
2
Employers required to carry workers' compensation insurance include any person or limited liability
company with one or more employees in the construction industry who "erect[s], demolish[es], alter[s], or repair[s]
improvements." Section 287.030.1(1), (3).
2
and no employees in other quarters though wage reports stated that wages were paid by the
Company in all quarters.
The Fraud and Noncompliance Unit investigator did not undertake any other
investigation until mid-May, 2014, when the investigator began attempting to reach
Seymour by telephone. The investigator successfully contacted Seymour on May 19, 2014.
During the recorded telephone call, Seymour admitted that he employed one or more
employees during all quarters between August 3, 2011 and October 3, 2013, and that he
knew the Company did not have workers' compensation insurance as required during that
time frame. In the days that followed the May 19, 2014 telephone call with Seymour, the
investigator unsuccessfully attempted to gather information from Seymour's insurance
agent.
In mid-June, 2014, the Fraud and Noncompliance Unit prepared a probable cause
statement and referred Seymour's alleged offense to the Attorney General's Office for
prosecution.
On May 17, 2017, the State charged Seymour with failure to insure workers'
compensation liability in violation of section 287.128.7. At a bench trial on February 27,
2018, the State presented the testimony of the Fraud and Noncompliance Unit investigator.
The investigator described how investigations of this nature are undertaken; the steps taken
during the investigation of Seymour; how his investigation of Seymour modeled the steps
ordinarily taken in investigations of this nature; and the decision to refer the case to the
Attorney General. On cross-examination, the investigator offered no explanation for the
time that elapsed between the February 3, 2014 database searches and the attempts that
3
began in mid-May, 2014 to contact Seymour, and acknowledged that no other steps were
taken to investigate Seymour during the interim three month period.
At the close of the State's evidence, Seymour moved for a judgment of acquittal
based upon the three-year statute of limitations set forth in section 287.128.11. Seymour
argued that his offense was discovered as of February 3, 2014, and that the filing of charges
more than three years later on May 17, 2017 was time-barred. The State argued that
Seymour's offense was not discovered until May 19, 2014, and that the filing of charges on
May 17, 2017 was not time-barred.
The trial court granted Seymour's motion for judgment of acquittal, and dismissed
the proceedings. In a written judgment dated February 28, 2018 ("Judgment"), the trial
court found:
[A]fter considering the credibility of the testimony and evidence presented,
[the Court] finds the discovery date of [Seymour's] alleged criminal conduct
was February 3, 2014, that more than three (3) years elapsed before the filing
of the State of Missouri's initial information and that in accordance with
Section 287.128.11, this proceeding is now time barred.
IT IS THEREFORE ORDERED, ADJUDGED AND DECREED that
[Seymour's] Motion for Judgment of Acquittal at the Close of the State of
Missouri's Case is hereby granted. This proceeding is dismissed [] as having
not been timely brought within the applicable limitation.
The State filed this timely appeal.
Appellate Jurisdiction
Before addressing the merits, we must determine whether we have jurisdiction to
consider this appeal. State v. Lilly, 410 S.W.3d 699, 701 (Mo. App. W.D. 2013). That is
because "'[t]he right to appeal is purely statutory and, where a statute does not give a right
4
to appeal, no right exists.'" Buemi v. Kerckhoff, 359 S.W.3d 16, 20 (Mo. banc 2011)
(quoting State ex rel. Coca-Cola Co. v. Nixon, 249 S.W.3d 855, 859 (Mo. banc 2008)). If
we "'lack[] jurisdiction to entertain an appeal, the appeal must be dismissed.'" Lilly, 410
S.W.3d at 701 (quoting Walker v. Brownel, 375 S.W.3d 259, 261 (Mo. App. E.D. 2012)).
Rule 30.01(a)3 provides that "after the rendition of final judgment in a criminal case,
every party shall be entitled to an appeal permitted by law." (Emphasis added.) The State's
right of appeal is purely statutory, and is controlled by section 547.200. State v. Connell,
326 S.W.3d 865, 866-67 (Mo. App. W.D. 2010) ("[W]here a statute does not give [the
State] a right to appeal, no right exists."). Relevant to this case, section 547.200.2 provides
in pertinent part that:
The state, in any criminal prosecution, shall be allowed an appeal in . . . all
[] criminal cases except in those cases where the possible outcome of such
an appeal would result in double jeopardy for the defendant.
(Emphasis added.) If appeal of the Judgment would result in double jeopardy for Seymour,
the State has no right of appeal, requiring dismissal of this appeal.
The State argues that its appeal of the Judgment will not result in double jeopardy
for Seymour as he was acquitted on a basis not related to factual guilt or innocence. We
agree.
For purposes of the Double Jeopardy Clause:4
[A] defendant who has been released by a court for reasons required by the
Constitution or laws, but which are unrelated to factual guilt or innocence,
has not been determined to be innocent in any sense of that word, absolute
or otherwise. In other circumstances, [courts] ha[ve] had no difficulty in
3
All rule references are to Missouri Court Rules, Volume I—State, 2018 unless otherwise indicated.
4
Both the United States Constitution and the Missouri Constitution provide individuals with protection
from double jeopardy. U.S. Const. amend. V; Mo. Const. art. I, section 19.
5
distinguishing between those rulings which relate to "the ultimate question
of guilt or innocence" and those which serve other purposes.
United States v. Scott, 437 U.S. 82, 98 n. 11 (1978) (internal citations omitted). Rulings
that "serve other purposes" include "procedural dismissals" such as "'a legal judgment that
a defendant, although criminally culpable, may not be punished.'" Evans v. Michigan, 568
U.S. 313, 319 (2013) (quoting Scott, 437 U.S. at 98). "[A] defendant is acquitted [on the
ultimate question of guilt or innocence] only when 'the ruling of the judge, whatever its
label, actually represents a resolution [in the defendant's favor], correct or not, of some or
all of the factual elements of the offense charged.'" Scott, 437 U.S. at 97 (quoting United
States v. Martin Linen, 430 U.S. 564, 571 (1977)). The statute of limitations is "not an
element of the crime charged." State v. Coor, 740 S.W.2d 350, 356 (Mo. App. S.D. 1987)
(holding that State's appeal of dismissal of charges based on the statute of limitations would
not result in double jeopardy even though court heard evidence to decide the issue).
Here, though the trial court heard all of the State's evidence bearing on the issue of
Seymour's guilt or innocence before considering and ruling on Seymour's motion for
judgment of acquittal based on the statute of limitations,5 the trial court did not determine
the question of Seymour's guilt or innocence when it granted the motion for judgment of
acquittal. Instead, the trial court released Seymour for a procedural reason required by law
that was unrelated to Seymour's guilt or innocence. Midtrial dismissal of a case on the
5
The State's Brief suggests that Seymour did not raise the issue of the statute of limitations until the close of
the State's evidence. Seymour's Brief argues that he electronically filed a motion addressing the statute of
limitations immediately before trial. Regardless, it is plain from the trial transcript that the trial court did not address
the statute of limitations defense until that topic was raised by Seymour at the close of the State's evidence. For
reasons we explain, infra, the timing of Seymour's filing of a motion raising the statute of limitations defense is
irrelevant, as no one contests that the issue was raised before disposition of the case.
6
basis of the statute of limitations is no less a dismissal unrelated to guilt or innocence than
if the defense is raised and ruled pretrial. See Scott, 437 U.S. at 99 (holding that where a
defendant prevails on a midtrial motion to dismiss on grounds unrelated to guilt or
innocence, it is not improper to terminate the proceedings on those grounds, and "a
defendant [who] prevails on such a motion [] [takes] the risk that an appellate court will
reverse the trial court" requiring a new trial). This is consistent with the fact that the statute
of limitations is an affirmative defense that can be permissibly "raised . . . before a final
disposition of the case." Dorris v. State, 360 S.W.3d 260, 268 (Mo. banc 2012); see also,
State v. Cotton, 295 S.W.3d 487, 490 (Mo. App. E.D. 2009) (holding the affirmative
defense of the statute of limitations must be raised in a criminal case "'before final
disposition of the case whether by conviction or plea, or it is waived'") (quoting Longhibler
v. State, 832 S.W.2d 908, 910 (Mo. banc 1992)).
We conclude that the State's appeal of the Judgment is statutorily authorized by
section 547.200.2 as the outcome of this appeal will not result in double jeopardy for
Seymour. Accordingly, we have jurisdiction to consider the State's appeal.
Analysis
The State's sole point on appeal asserts that the trial court erred in granting
Seymour's motion for judgment of acquittal on the basis of the statute of limitations
because its prosecution of Seymour for violation of section 287.128.7 was not time-barred
by section 287.128.11. Specifically, the State argues that the charge against Seymour was
filed within three years of discovery of Seymour's offense. "The determination of whether
7
or not a statute of limitations applies is a question of law and is reviewed de novo." State
v. McMillian, 524 S.W.3d 51, 53 (Mo. App. W.D. 2016).
Section 287.128.7 provides that an employer "who knowingly fails to insure his
liability" pursuant to the Workers' Compensation Law is guilty of a class A misdemeanor.
Section 287.128.11 sets forth the statute of limitations applicable to violations of section
287.128.7, and provides:
Any prosecution for [] violation of [section 287.128.7] [] shall be
commenced within three years after discovery of the offense by an aggrieved
party or by a person who has a legal duty to represent an aggrieved party and
who is not party to the offense.
(Emphasis added.)
The Fraud and Noncompliance Unit is the State's investigative unit, and is
"responsible for investigating incidences of fraud and failure[s] to comply" with section
287.128. Section 287.128.10; see also section 287.128.8 (requiring the Fraud and
Noncompliance Unit to investigate complaints submitted by "[a]ny person"). As the State's
statutorily authorized investigative unit, the Fraud and Noncompliance Unit is "a person
who has a legal duty to represent an aggrieved party." State v. Frese, 487 S.W.3d 71, 75-
76 (Mo. App. W.D. 2016). Thus, the statute of limitations for prosecuting Seymour's
alleged violation of section 287.128.7 began to run pursuant to section 287.128.11 "after
discovery of [Seymour's] offense" by the Fraud and Noncompliance Unit.
The phrase "discovery of the offense" is not defined by section 287.128. The
meaning of the phrase "discovery of the offense" was discussed, however, in Frese. 487
S.W.3d at 76-78. Frese concluded that because the Fraud and Noncompliance Unit is the
8
State's statutorily authorized investigative unit with authority to refer an investigated file
to the Attorney General for possible prosecution, "the phrase 'discovery of the offense by
a person who has a legal duty to represent an aggrieved party' contemplates . . . the
discovery of a referable offense by the State's investigative agent." Id. at 76 (emphasis
added). See also, id. at 77 (holding that when the Fraud and Noncompliance Unit
"discovered all the facts necessary to refer the offense to the Attorney General for
prosecution," the statute of limitations accrual period was triggered). Frese applied that
definition to conclude that "discovery of the offense" was not delayed, as the State had
argued, to the point when a matter is actually referred to the Attorney General, but instead
occurs when the facts "necessary" to refer the offense have been discovered by the Fraud
and Noncompliance Unit. Id. at 75, 77.
Here, we must decide when, during an investigation, the Fraud and Noncompliance
Unit has discovered the facts necessary to refer an offense so as to trigger section
287.128.11's accrual period. That question was not at issue in Frese.6
Seymour argues that the Fraud and Noncompliance Unit discovered his alleged
offense on February 3, 2014, because as of that date, the investigator had discovered
enough facts to refer his offense to the Attorney General, and learned nothing more during
the balance of the investigation not already known or suspected. The State argues that the
Fraud and Noncompliance Unit discovered Seymour's offense on May 19, 2014, because
6
Frese had no reason to address when the Fraud and Noncompliance Unit should be deemed to have
discovered facts "necessary" to refer a matter during an investigation. Frese found only that as between actual
referral of a matter to the Attorney General, and the last reported step in the Fraud and Noncompliance Unit's
investigation (which happened to be a phone call to the employer), discovery of the offense occurred at the end of
the investigation. 487 S.W.3d at 75-77.
9
on that date, Seymour confirmed that he had least one employee and no workers'
compensation insurance at all times between August 3, 2011 and October 3, 2013. Because
section 287.128.7 requires a "knowing"7 failure to insure workers' compensation liability,
the State argues that Seymour's admissions were facts necessary to discover a referable
offense.
Both parties' arguments presume that the definition of "discovery of the offense"
announced in Frese contemplates the subjective, hindsight dissection of an investigation
to pinpoint the precise moment when facts sufficient to refer a matter were first discovered.
Frese cannot be fairly read in this manner. Frese explained that "'[t]he primary rule of
statutory interpretation is to effectuate legislative intent through reference to the plain and
ordinary meaning of the statutory language.'" 487 S.W.3d at 75 (quoting State v. Graham,
204 S.W.3d 655, 656 (Mo. banc 2006)). "'[I]n ascertaining legislative intent . . . the entire
act must be construed together and all provisions must be harmonized.'" Id. (quoting
Eminence R-1 Sch. Dist. v. Hodge, 635 S.W.2d 10, 13 (Mo. 1982)). Thus, the definition
of "discovery of the offense" announced in Frese must be construed and applied in a
manner that can be harmonized with the other provisions in Chapter 287.
Section 287.128.10 establishes the Fraud and Noncompliance Unit and renders it
"responsible for investigating incidences of fraud and failure to comply with the provisions
of [Chapter 287]." Section 287.128.8 provides that the Fraud and Noncompliance Unit
7
Section 562.016.3 provides that "[a] person 'acts knowingly', or with knowledge: (1) With respect to his or
her conduct or to attendant circumstances when he or she is aware of the nature of his or her conduct or that those
circumstances exist; or (2) With respect to a result of his or her conduct when he or she is aware that his or her conduct
is practically certain to cause that result."
10
"shall investigate all complaints and present any finding of fraud or noncompliance to
the director, who may refer the file to the attorney general." These provisions require the
Fraud and Noncompliance Unit to conduct an investigation, but leave the scope and extent
of the investigation to the Unit's discretion. And these provisions contemplate that at the
conclusion of the Fraud and Noncompliance Unit's investigation, a determination will be
made as to whether there is a finding of fraud or noncompliance that could be presented to
the Attorney General.
It would be inconsistent with the intent of these provisions to require a subjective,
hindsight analysis of a Fraud and Noncompliance Unit investigation to determine the
precise moment when sufficient facts were first discovered to permit referral to the
Attorney General, or when (as is argued here), an investigation stopped yielding
information not already known or suspected by the investigator. Construing Frese's
definition of "discovery of the offense" in the subjective, hindsight manner argued by the
parties would encourage incomplete investigations, and the premature referral of matters
for prosecution, based solely on an investigator's concern that a tribunal might later
conclude that the investigator learned enough to permit referral of an offense midway
through an otherwise objectively reasonable investigation. In other words, a subjective,
hindsight critique of an investigation would usurp the Fraud and Noncompliance Unit's
statutory authority and directive to conduct an investigation sufficient to permit it to
conclude whether there is a finding of fraud or noncompliance that should be referred to
the Attorney General.
11
Instead, to be harmonized with sections 287.128.8 and .10, the definition of
"discovery of the offense" set forth in Frese necessarily refers to the entirety of an
objectively reasonable investigation conducted by the Fraud and Noncompliance Unit. So
long as the Fraud and Noncompliance Unit has engaged in an investigation that is
objectively reasonable in scope and time frame, then we are bound to conclude that it is
engaging in the investigation it is required to undertake by law. And so long as an
investigation is objectively reasonable, it cannot be said that the Fraud and Noncompliance
Unit has discovered all the facts necessary for it to determine whether there is a finding of
fraud or noncompliance that may be referred to the Attorney General for prosecution.
"The interpretation of a statute is a pure question of law, and [] we give the trial
court's interpretation no deference." State v. Rodgers, 396 S.W.3d 398, 400 (Mo. App.
W.D. 2013). Here, the trial court found that the Fraud and Noncompliance Unit discovered
Seymour's offense as of February 3, 2014. We do not know, however, whether the trial
court did so based on the erroneous belief that the definition of "discovery of the offense"
announced in Frese requires a subjective, hindsight analysis of when the Fraud and
Noncompliance Unit first discovered facts that could have permitted a referral to the
Attorney General. Regardless, we are "primarily concerned with the correctness of the trial
court's result, not the route taken by the trial court to reach that result." Blue Ridge Bank
and Trust Co. v. Trosen, 309 S.W.3d 812, 815 (Mo. App. W.D. 2010) (quotation omitted).
"[T]he judgment will be affirmed if cognizable under any theory, regardless of whether the
reasons advanced by the trial court are wrong or not sufficient." Id. (quotation omitted).
12
Here, the Fraud and Noncompliance Unit's statutory investigation continued after
the February 3, 2014 database searches to include telephone contact with Seymour on
May 19, 2014, and to include efforts to contact Seymour's insurance agent in the days
following the telephone call with Seymour. There is no evidence to suggest, and Seymour
does not contend, that the investigative steps taken after February 3, 2014 were not
objectively reasonable. However, there was a period of over three months between the
investigator's database searches on February 3, 2014, and the investigator's first attempt to
contact Seymour in mid-May, 2014 when nothing whatsoever was done to further
investigate Seymour. The investigator offered no explanation for this delay. The trial court
could have concluded that even though the investigative efforts undertaken by the Fraud
and Noncompliance Unit were objectively reasonable in scope, the time taken to complete
the investigation was not objectively reasonable. As a result, the trial court could have
concluded that the Fraud and Noncompliance Unit's objectively reasonable investigation
ended after the February 3, 2014 data bank searches, and that as a result, the accrual period
set forth in section 287.128.11 was triggered on that date.
A similar conclusion was reached under analogous circumstances in State v. Young,
440 N.E.2d 1379 (Oh. Ct. App. 1981). There, the court held that "discovery of the offense"
of knowingly making a false statement in connection with securing state benefits occurred
at the "absolute latest within a reasonable period" after the State's administrative agency
began an investigation. Id. at 1381. The court applied an objective standard to assess the
scope and time frame of an investigation to determine when the agency should be deemed
to have discovered an offense. Id. The court noted that particularly with respect to the
13
time taken to conduct an investigation, the use of an objective standard prevents
investigators from "procrastinat[ing] with impunity when they ha[ve] in their possession
information or material which indicate[s]" an offense may have been committed. Id. The
court found that a five month investigation that began with a database search was not
objectively reasonable, and that charges later filed as a result of the investigation were
time-barred. Id.
We therefore conclude that the trial court did not err in granting Seymour's motion
for judgment of acquittal based on the statute of limitations in section 287.128.11.
Although the scope of the Fraud and Noncompliance Unit's investigation was objectively
reasonable in so far as the steps taken to investigate Seymour, the time taken to complete
the investigation was not objectively reasonable given a delay of over three months when
no investigative efforts were being pursued, despite a strong indication after the database
searches on February 3, 2014 that a referable offense may have occurred. The Fraud and
Noncompliance Unit's objectively reasonable investigation therefore ended on February 3,
2014. Since Seymour was charged with violating section 287.128.7 on May 17, 2017,
prosecution of the charge was time-barred by section 287.128.11.
Point denied.
Conclusion
The trial court's Judgment is affirmed.
__________________________________
Cynthia L. Martin, Judge
14
All concur
15