Donald Edward Little v. the State of Texas ( 2023 )

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-21-00393-CR
Donald Edward Little, Appellant
v.
The State of Texas, Appellee
FROM THE 51ST DISTRICT COURT OF IRION COUNTY
NO. CR21-002, THE HONORABLE LEE HAMILTON, JUDGE PRESIDING
MEMORANDUM OPINION
Donald Edward Little was convicted of misapplication of fiduciary property
totaling more than $30,000 but less than $150,000 and was sentenced to five years’
imprisonment. See Tex. Penal Code §§ 12.34, 32.45. In five issues on appeal, he contends that
the evidence is insufficient to support his conviction and that the trial court erred by allowing the
State to amend the indictment. We will affirm the trial court’s judgment of conviction.
BACKGROUND
In 1996, articles of incorporation were filed with the Office of the Secretary of
State forming the Barnhart Water Supply Corporation (BWSC) to provide water services to
individuals residing in and around Barnhart, Texas. The BWSC’s original bylaws specified that
the board of directors would consist of three directors: a president, a vice president, and a
secretary-treasurer. The bylaws stated that the BWSC members would elect the directors at the
members’ regular meeting, that the directors would not be paid for their services but could be
compensated for actual expenses by a majority vote of the directors, and that checks from
BWSC’s account had to be signed by two directors: the secretary-treasurer and either the
president or the vice-president. Additionally, the bylaws specified that anyone owning property
or having a legal right to possess or occupy property in the area covered by BWSC “shall have
the right to become a Member of the Corporation upon payment of the Membership fee” of
$100, entitling the applicant to a connection to the BWSC system. Further, the board of directors
could determine the form of the membership certificates, and ownership of memberships
“are deemed to be vested in those persons who are the record owners of Memberships.”
Additionally, the bylaws specified that they could be altered or amended by a majority vote of
the members but could not be amended in a manner that deprives any member “of rights and
privileges then existing.”
In 2017, the three longstanding directors of the BWSC board—Bill Avery
(president), John Nanny (vice president), and Frances Shaw (secretary-treasurer)—wanted to
transfer the operation of BWSC to a new board. Michael Barron expressed interest in the
opportunity. According to the minutes from the board’s meeting in April 2017, Barron presented
a letter of intent to acquire the assets of BWSC, and the board accepted the letter of intent and
scheduled an agenda item to discuss the letter at the next meeting in May 2017. Barron attended
that meeting with his lawyer Little and Ned Smith. After that meeting, Barron, Little, and Smith
took over the operations for BWSC.
Shortly after the meeting, Little prepared amended bylaws for BWSC naming the
following individuals to the board of directors: Barron (president and treasurer), Smith (vice
president), and Little (secretary). The amended bylaws specified that checks or other payment
2
instruments may be authorized by the signature of the president, the secretary, or another officer
authorized by the amended bylaws and no longer required signatures from two officers. Further,
the amended bylaws empowered the board of directors to make future amendments to the bylaws
or to adopt new ones by a majority vote of the directors. Similar to the previous bylaws, the
amended bylaws stated that the purpose of the nonprofit corporation is “to provide water services
and services ancillary to the provision of water” in Barnhart.
While serving as president of BWSC, Barron purchased a backhoe with his
personal funds. After purchasing the backhoe, Barron tried to sell it by placing it in the parking
lot of a business that he owned with a for sale sign on it. On August 28, 2019, Barron sent an
email to the bookkeeper for BWSC, Nola Baumann, asking her to call him when she received
the email. Barron attached to the email a bill of sale for the backhoe stating that BWSC was
going to purchase the backhoe from him for $28,500. When Baumann talked with Barron, he
asked her to write a check to him from BWSC’s bank account for $28,500. Baumann refused,
explaining that she believed that the residents of Barnhart had to vote to approve that type of
acquisition. Baumann called residents in the community to see if they knew anything about the
proposed sale, but none of the residents had heard about it.
Two days later, Little emailed Baumann, informing her that she had been fired
from her position and demanding that she hand over all records for BWSC. The email also
stated that BWSC only has three members, that all BWSC assets and authority over those assets
were transferred to the board of directors in 2018, and that the residents of Barnhart “do not have
any ownership interests in” BWSC. Little sent a follow-up email the following day stating that if
Baumann did not return all the records, he would “act accordingly to obtain the property and
3
records.” An employee for BWSC’s bank called Baumann to inform her that Barron had taken
the money from the account.
After Baumann was fired, a meeting was scheduled for October 28, 2019,
between the new board of directors and the customers of BWSC, who were Barnhart residents.
The former directors attended the meeting, and the meeting was recorded. During the meeting,
Little told the crowd multiple times that the former board “sold your rights” away and told the
crowd that no one at the meeting other than Barron, Little, and Smith was a member of BWSC
because no one besides the three of them had membership certificates. At the meeting, Little
handed out copies of a document entitled “Unanimous Resolution of the Members of Barnhart
Water Supply Corporation,” which he stated had been signed by all three former directors. The
unanimous resolution was dated May 3, 2017, and specified that the former directors resigned
their positions and appointed Barron, Little, and Smith “as sole Members of Barnhart Water
Supply Corporation” “with all rights and privileges . . . , including but not limited to transfer of
all assets, bank accounts, [and] certificates of deposit.” The unanimous resolution also purported
to indemnify the former directors for any liabilities incurred related to their service, contained
the former director’s signatures, and specified that the former directors were “all [of] the
Members of the Barnhart Water Supply Corporation.”
At the meeting, former directors Nanny and Shaw both denied signing the
document that Little handed out. Further, another resident asserted that Little was just “lining
his pockets,” and Little responded by saying that “[w]e’re lining our pockets, yeah.” Little and
Barron then left the meeting, and Little stated that the dispute would be resolved in court.
Following that meeting, a group of residents of Barnhart sought a temporary and
permanent injunction against Barron and Little preventing them from selling any assets,
4
collecting any money due, and writing checks on BWSC’s corporate account. The residents also
filed a petition to remove Barron and Little as directors of BWSC, asserting that Barron and
Little improperly made large financial expenditures of BWSC’s money without approval by
the members, paid themselves with BWSC’s money, and amended BWSC’s bylaws to deprive
members of their rights and privileges. Contemporaneously, Barron filed suit against several
residents of Barnhart, asserting that he was fraudulently induced into becoming a director and
operating BWSC, that the residents improperly converted BWSC property, and that the former
directors breached the terms of the unanimous resolution. Barron was represented by Little in
both suits. A few months later, the parties filed an agreed motion to dismiss both cases after
entering into a settlement agreement. Under the settlement agreement, the parties agreed to the
following: BWSC would retain ownership of the backhoe; the parties agreed not to pursue any
claims of fraud or perjury or any further legal actions with the Attorney General, the Texas
Rangers, and the Texas Commission on Environmental Quality; and Baron agreed that he would
no longer attend any BWSC meeting.
Approximately one year later, Little was indicted for misapplication of fiduciary
property belonging to BWSC by receiving personal payments from BWSC that were not in
conformity with BWSC’s purposes. An attachment to the indictment listed five specific checks
serving as the basis for the charge. During the trial, the following individuals testified for the
State: Pete Barrera, who was the current president of BWSC; Smith, who was the vice president
of and director for BWSC when Barron and Little were also officers and directors; Baumann,
who was the bookkeeper for BWSC before she was fired by Little; Glenda Kuykendall, who was
the secretary for BWSC at the time of trial; Jeffrey Lisson, who was the attorney that previously
represented Nanny and testified as an expert on nonprofit corporations; Susan Downman, who
5
was an auditor working for the Attorney General’s Office in the Criminal Investigations
Division; and Greg Dickerman, who was an investigator working for the Attorney General’s
Office in the Criminal Investigations Division. When presenting his case, Little elected to testify
and called several witnesses including the following: former directors Avery, Nanny, and Shaw
who, respectively, were the president, vice president, and secretary-treasurer of BWSC for years
before Barron and Little took over operating BWSC; Barron, who took over operating BWSC
with Little; and Bart Baggett, who testified as a handwriting expert.
In addition, multiple exhibits were admitted into evidence, including copies of
various checks, bank records from several accounts, the unanimous resolution, a recording of the
meeting where Little passed out the unanimous resolution, BWSC’s articles of incorporation,
BWSC’s bylaws and amended bylaws, the minutes of the board meeting from April 2017, a copy
of an indictment from January 2019 against Barron for aggravated assault with a deadly weapon,
a copy of a notice of appearance of counsel filed by Little on behalf of Barron in the aggravated-
assault proceeding, paperwork from the civil suits filed by the residents and by Barron, the
settlement agreement and order dismissing the two civil suits, an application for service from
BWSC filed by Barrera, the bill of sale sent to Baumann, the email sent to Baumann stating that
Little had fired her, a membership certificate issued to Barron in May 2017 and signed by Little,
and an invoice of services prepared by Little setting out legal work that he asserted he performed
from November 2019 to February 2020.
Regarding the checks forming the basis for the indictment, copies of the following
checks were admitted as exhibits:
A check from BWSC’s account dated September 5, 2019, that was made out to
Barron for $28,500 and contained in the memo line a remark that the check was
6
for reimbursement for the backhoe.
A check from Barron’s personal account dated September 5, 2019, that was made
out to Little for $28,500 and listed in the memo line that the check was for
attorney’s fees.
A check from BWSC’s bank account dated October 29, 2019, that was made out
to Little for $5,000, signed by Barron, and specified in the memo line that the
check was for “Attorney At Law October 29 Litigation.”
A cashier’s check from BWSC’s account dated November 1, 2019, that was made
out to Barron for $10,000 and had Barron’s and Little’s signatures on the
endorsement side of the check.
A check from BWSC’s account dated December 9, 2019, that was made out to
Little for $1,000, signed by Barron, and did not list anything in the memo line.
At trial, Lisson testified as an expert on nonprofit corporations. In his testimony,
Lisson explained that water supply corporations are nonprofit corporations. Further, he related
that members of nonprofit corporations do not receive salaries but that employees may be paid
a salary. Next, he stated that a director or officer can be paid reasonable rates for providing
services to a nonprofit corporation; however, he related that any distribution made would have to
be used for purposes benefitting the people who obtain services from the nonprofit corporation.
Additionally, he testified that nonprofits are designed to serve the people that benefit from its
operations, that a water supply corporation’s assets must be used solely for the benefit of the
corporation and its members and cannot be used to benefit third parties, and that anyone who
gets service from a water supply corporation “is a member of that corporation.” He explained
that nonprofit corporations may not make a profit and that no one is supposed to make money
from a water supply corporation. Moreover, he stated that only members of a water supply
corporation can serve on the board of directors, meaning that individuals on the board must
receive water service from the corporation. Next, Lisson explained that individuals on the board
7
and officers are fiduciaries to a water supply corporation and its members and must put the
corporation’s and the members’ needs ahead of their own. Regarding BWSC, Lisson testified
that BWSC was designed to benefit its members, who are the people obtaining water service
from BWSC, including renters and property owners; that the board of directors could not own
BWSC; and that the original bylaws did not authorize cancelling anyone’s membership status.
See Tex. Water Code § 67.016(e) (limiting circumstances in which corporation may cancel
membership to those where person fails to meet conditions for water service or comply with
condition placed on receipt of water).
Concerning the transfer of BWSC’s operations to Barron, Little, and Smith,
Lisson testified that the unanimous resolution was not proper because the transfer of all or
substantially all of the assets requires approval by the members, rather than the board, at a
meeting with proper notice. Further, he stated that Little could not serve on the board because he
did not receive services from BWSC. See id. § 67.0051 (providing that to be qualified to be
director, person must be member of corporation). Similarly, Lisson explained that the proposed
amendments to the bylaws were not properly adopted because amendments require a vote by the
members at a meeting and because the amendments were inconsistent with the directive from the
original bylaws specifying that a resident’s membership could not be taken away.
During his cross-examination, Lisson explained that water supply corporations
could hire an attorney and pay attorney’s fees if the services provided by the attorney were for
the benefit of the nonprofit and its mission. However, on redirect, Lisson testified that a lawyer
seeking to be paid by a nonprofit should sign a retainer agreement showing that the lawyer’s
services were for the purpose of the nonprofit and setting out the terms of the representation,
fees, and scope of what the lawyer would do. Further, he related that any payment would need
8
approval by the board of directors, that an individual getting paid should not be part of the
approval vote if he or she is on the board due to the conflict of interest, and that there would need
to be a record of the approval vote in the organization’s records.
The auditor for the Criminal Investigation Division of the Attorney General’s
Office, Downman, testified regarding the forensic audit that she performed in this case.
Specifically, Downman related that she looked at three accounts for BWSC, one personal
account for Barron, and one business account for Barron. Regarding BWSC’s accounts,
Downman related that BWSC received money almost exclusively from its customers’ water bills
and that typically the expenditures went to plumbing vendors, maintenance expenses, water
testing vendors, and payments to the bookkeeper; however, Downman explained that there were
payments to Barron and Little that did not appear to be related to BWSC’s purpose and that the
total amount of misapplied funds that Little received was $44,500 belonging to BWSC.
Downman related that the first unusual check was a check from BWSC’s account
dated September 5, 2019, that was made out to Barron for $28,500; was authorized by Barron
without another signatory; and indicated that it was reimbursement for the backhoe. The second
check was from Barron’s account, had the same date as the previous check, was made out to
Little for the same amount as the previous check, and noted that the amount was for attorney’s
fees. Downman explained that she was unaware of any business or legal events involving
BWSC occurring at that time; however, she explained that Little had represented Barron during a
criminal case starting in March 2019 and that Barron’s account had not been used to pay Little
from January to August of 2019. The third check was from BWSC’s account, was dated October
29, 2019; was made to Little for $5,000; was authorized by Barron without any other signatory;
and indicated that the money was for the October 29 litigation. The fourth was a cashier’s check
9
dated November 1, 2019, for $10,000 from BWSC’s account, was made out to Barron, and
had Barron’s and Little’s signatures on the endorsement line. In addition, the withdrawal slip
showed that the only authorizing signature for that transaction was Barron’s signature. The final
check was from BWSC’s account; was dated December 9, 2019; was made to Little for $1,000;
and did not mention what the money was for in the memo line.
The investigator in the Criminal Investigations Division of the Attorney General’s
Office, Dickerman, testified regarding his investigation after the case was referred to the
Attorney General from the Irion County Sheriff’s Office in March 2020. In his testimony,
Dickerman related that his review of BWSC’s articles of incorporation and bylaws indicated that
the board of directors must be elected by the members of the water supply corporation at an
annual meeting. Further, he related that the directors must be members of the water supply
corporation and that the bylaws required that the person receive service from BWSC, meaning
that the individual must have paid the application fee for a water meter. Along those lines, he
explained that someone becomes a member by applying and paying for a water meter to receive
service from BWSC. Moreover, he stated that BWSC could not rescind an individual’s
membership or take away voting rights, that BWSC’s bylaws could only be amended by a vote
of the members and could not be amended to deprive any members of their rights, and that the
new bylaws did not reflect that they were presented and approved by the members and instead
state that they were approved by the board of directors. Regarding the amended bylaws, he
testified that they gave Barron the authority to write checks without another signatory. Further,
he related that although the unanimous resolution stated that the only three members of BWSC
were Avery, Nanny, and Shaw, there were other members as well. Although he acknowledged
that BWSC started collecting more money from the residents after Barron took over, Dickerman
10
explained that charging members more simply to increase BWSC’s revenue was not consistent
with BWSC’s purpose.
Regarding the financial transactions alleged in this case, Dickerman related that in
September 2019 the funds from BWSC’s corporate account were removed and transferred to
another bank. Moreover, Dickerman discussed the checks mentioned above and explained that
Barron’s accounts would not have had sufficient funds to cover the $28,500 check written to
Little if Barron had not deposited the $28,500 from BWSC. Additionally, Dickerman explained
that the $10,000 cashier’s check endorsed by Barron and Little was written on the day after the
residents filed a civil suit seeking to have Barron and Little removed from the board and that the
$5,000 check to Little from BWSC’s account was also written about when the residents initiated
the civil suit. Dickerman also testified about other checks written by Barron to Little around the
time of legally significant events. For example, Dickerman stated that Barron wrote Little a
check for $3,000 on April 18, 2017, with a memo indicating that the check was for “water,” and
the date of the check is about when Barron presented his letter of intent to the former board.
Similarly, Dickerman testified that Barron wrote Little a check for $12,500 on May 3, 2017, with
a memo stating that the check was for “BWSC,” and the date of the check is the same as the date
appearing on the Unanimous Resolution drafted by Little and the date of the meeting in which
the former board purportedly agreed to transfer operations to Barron, Little, and Smith. Along
those lines, Dickerman related that Barron wrote a check to Little for $15,000 on October 19,
2018, stating that it was for “legal” work, and Dickerman explained that the amended bylaws
were adopted by Barron and Little on the same date listed on this check.
The current president of BWSC, Barrera, testified that he never saw the
unanimous resolution, that Barron put extra meters on the residents’ property and charged the
11
residents for those extra meters, that Little was trying to increase the price of water for his own
benefit, that Little informed residents at the October 2019 meeting that they were no longer
members of BWSC, that the residents had to sue to regain control of BWSC, and that most of the
funds from BWSC had been depleted when he took over as president. Regarding the backhoe,
Barrera explained that Barron used BWSC money to buy the backhoe even though he did not
check with the members, that BWSC had no need for the equipment because it rarely uses that
type of equipment and can just rent the equipment if needed or ask to use equipment belonging
to one if its members, that BWSC did not have a place to store the equipment, and that BWSC
ultimately sold the backhoe for $24,000. Concerning BWSC, Barrera related that the application
fees or deposits that residents paid to get water service were considered their membership fees.
Smith, who was the other new director on the board with Barron and Little,
testified that he had been a member of BWSC before becoming vice president because he paid
for a water meter, that anyone who had a meter was a member, that Barron and Little never
mentioned that the three of them would be the only members after the transfer, and that he had
not intended to take anyone’s membership away and instead wanted to volunteer to help
maintain BWSC’s water supply. Further, Smith related that he retired after Barron and Little
fired Baumann, that Barron used his position with BWSC “as a way to make money” rather than
“take care of the community,” and that Barron and Little told the community in the October 2019
meeting that the community no longer had any control over what BWSC did. Regarding the
backhoe, Smith said that Barron purchased the backhoe and used it on his personal property, that
the backhoe cost $24,000 plus shipping, and that Barron did use the backhoe to clean alleyways
for BWSC. Concerning the May 2017 meeting where Barron, Little, and he became board
members, Smith explained that he saw the former board of directors sign a document but did
12
not know what the document was. During his cross-examination, Smith stated that the new
water meters more accurately measured water consumption.
Next, Baumann testified that she served as the bookkeeper for BWSC for more
than twenty years, that individuals automatically became members of BWSC by filling out an
application and paying a deposit for water service, that everyone with a water meter was a
member, and that BWSC was formed to benefit the citizens of Barnhart. Further, Baumann
explained that the original bylaws required two of the officers to sign checks. Additionally,
Baumann related that she was fired after Barron asked her to write him a check for the backhoe
for an amount Barron believed the backhoe was worth, that she refused because that type of
purchase had to be approved by the members, that Barron stated that he needed the money to pay
for back surgery, and that Little sent her an email explaining that two directors—Barron and
him—had authorized the purchase. Regarding the backhoe, Baumann said that she called
someone who sells backhoes and that the individual explained that the backhoe was not worth
as much as what Barron suggested. Furthermore, Baumann explained that the bill of sale did
not provide enough information to ascertain the condition or value of the backhoe for several
reasons, including by not disclosing the model year or hours used. Moreover, Baumann stated
that BWSC did not need a backhoe because residents in Barnhart would donate their time and
their equipment for BWSC projects that came up, that there had only been two or three times that
equipment had been needed for repairs, and that BWSC had no place to store the backhoe.
Concerning the civil lawsuits, Baumann testified that under the settlement,
membership was transferred back to the residents, and Barron and Little were required to return
all BWSC records. Baumann also related that she currently volunteers to help BWSC and the
current bookkeeper and that her review of the records revealed the checks written to Little;
13
however, Baumann explained that she did not find any invoices or other documents showing that
Little had performed any legal work for BWSC.
Following Baumann’s testimony, the current secretary for BWSC, Kuykendall,
testified that the only income BWSC received was from the water bills sent to residents.
Regarding BWSC’s records, Kuykendall explained that there were no invoices for legal services
provided to BWSC by Little and no letter specifying that he would represent BWSC for any
particular fee.
When presenting his defense, Little called the former president of BWSC, Avery,
who testified that he wanted someone else to take over running BWSC; that Barron was
interested in the opportunity; that all of the members agreed in April 2017 to allow Barron,
Little, and Smith to take over; and that he told Little that all the members agreed to allow them
to take over and voted on it. However, Avery noted that the unanimous resolution incorrectly
stated that there were only three members and that Little added words like “sole members” when
drafting the resolution even though that was not true. Further, Avery stated that the unanimous
resolution was not presented to the members and was instead shown to the board of directors.
Moreover, Avery related that Little stated it was necessary for the board of directors to sign the
resolution to protect themselves from future liability, that he did not understand the resolution
when he signed it, that the former board of directors did not read the full resolution, and that he
was not sure if Nanny or Shaw signed the document.
Following Avery’s testimony, the former vice president of BWSC, Nanny,
testified that he signed something in Little’s presence but does not remember signing the
unanimous resolution; on the contrary, Nanny explained that the only document he remembered
signing was an indemnification clause that was worded differently from the unanimous
14
resolution. Similarly, the other former board member, Shaw, testified that she did not sign the
unanimous resolution. Further, Nanny stated that Little did not give the board copies of the
documents. Additionally, Nanny related that there were more than three members of BWSC,
that BWSC was owned by the thirty to forty users who paid for a meter, and that he only
intended to transfer operation of BWSC to a new board. Regarding the signatures on the
resolution, Little’s handwriting expert, Baggett, testified that after he examined known signatures
for Nanny and Shaw and compared them with the signatures on the resolution, he concluded that
Nanny and Shaw both signed the resolution.
Next, Little called Barron as a witness, and Barron testified that Little has
represented him in three prior cases, including his divorce and his criminal case. Regarding
BWSC, Barron explained that Little drafted a letter of intent stating that Barron wanted to
acquire BWSC’s assets and that Avery signed the letter at the April 2017 meeting when the
board of directors voted to accept the letter of intent. Further, Barron stated that all of the
directors signed the unanimous resolution, that the three directors were the only members, that
Avery said that he checked with the residents and that they all approved of the resolution, and
that the resolution appointed Little, Smith, and him as the sole members. Barron testified that
when he looked through BWSC’s records, he did not find any membership certificates for the
residents and that without certificates, the residents could not have been members; however,
Barron explained that he had a membership certificate. Additionally, Barron said that he
received no compensation for operating BWSC other than reimbursements for his expenses; on
the contrary, Barron stated that he invested $100,000 in BWSC that he paid from his $610,000
divorce settlement and that he spent “quite a bit” of his money buying supplies for BWSC
without reimbursement. Regarding the backhoe, Barron stated that he purchased it to replace all
15
the meters with new ones to stop the water loss that was happening each month, that BWSC
needed the equipment, that he decided to sell the backhoe to BWSC because he used it for the
benefit of BWSC, and that BWSC later sold the backhoe for $24,000. Moreover, Barron
testified that BWSC’s yearly revenue doubled after he took over. Barron also stated that he
believed that the former board had the authority to adopt the unanimous resolution.
In his testimony, Barron stated that he hired Little for the two civil lawsuits
involving BWSC but that Little was not fully paid for his services. Barron went over an invoice
setting out that Little was owed approximately $52,000 in fees and had a little over $6,000
in costs from November 2019 to February 2020 stemming from his representation in the two
lawsuits. Further, Barron explained that he paid Little $16,000 for reasonable attorney’s fees and
withdrew the money from BWSC’s account between October 2019 and mid-December 2019 but
could not pay Little the full amount owed because a preliminary injunction stopped him from
writing any more checks.
During his cross-examination, Barron agreed that the old bylaws required two
signatures on checks but that the amended bylaws got rid of that requirement and that as a
fiduciary, he could only expend money from BWSC’s accounts for the benefit of BWSC.
Further, Barron agreed that the articles of incorporation stated that individuals having property
served by BWSC have the right to become members by paying a fee. Additionally, Barron
stated that he was obligated to return all BWSC records and did so. Barron related that he
previously paid Little out of his personal bank account for legal services regarding researching
BWSC ($3,000), preparing the unanimous resolution ($12,500), preparing the bill of sale
($4,000), and drafting the amended bylaws and handling his divorce ($15,000), and Barron
explained that the payments were typically made at the time the legal services were provided.
16
When discussing Little representing him in his aggravated-assault case, Barron stated that he
did not pay Little for representing him in that case until September 2019 even though he was
indicted in January 2019 and even though Little informed the trial court that he was representing
Barron in March 2019.
Barron testified that he wrote himself a check for $28,500 from BWSC’s accounts
and that he needed the money at the time for back surgery, but he later stated that he needed the
money to pay attorney’s fees and fees for an investigator and that he wrote Little a check for the
same amount for attorney’s fees associated with BWSC. Barron also admitted that the funds
may have been compensation for Little representing him in the aggravated-assault case because
there were no legal matters related to BWSC occurring then. Concerning the $10,000 cashier’s
check withdrawn from BWSC’s account in November 2019, Barron said that the check was
endorsed by Little and him and that the check was “[p]robably for lawyer fees,” but Barron
admitted that he could not tell if the check was written for the benefit of the members of BWSC.
When asked about the $5,000 check to Little from BWSC’s account from October 2019, Barron
stated that the check was for attorney’s fees to defend him in the lawsuit filed by the residents.
Similarly, Barron stated that the $1,000 check to Little written in December 2019 and withdrawn
from BWSC’s account was for attorney’s fees for defending against the lawsuit filed by the
residents. Barron testified that he returned all the records pertaining to BWSC that were in
his possession.
During the trial, Little elected to testify and explained during his testimony that
Avery, Nanny, and Shaw all signed the resolution, that the bylaws in effect required individuals
to have certificates to be members, that the board of directors stated that they were the only
members, and that he relied on and believed that representation when he wrote the unanimous
17
resolution. Further, Little related that Barron, Little, and Smith obtained membership certificates
in May 2017 and that he created the certificates as secretary for BWSC. Regarding the checks
written to him from BWSC’s account, Little testified that the total amount was $16,000, that he
incurred over $6,000 in costs while representing BWSC, and that he was owed $55,000 in
reasonable fees for working 131 hours performing legal work. Moreover, Little related that any
payments that Barron made were for the benefit of BWSC.
In his cross-examination, Little admitted that he understood from the beginning
that BWSC was a nonprofit corporation. Although Little acknowledged that he owed a fiduciary
duty to the members of BWSC by becoming a director and an officer, he asserted that the only
members were Barron, Smith, and him. Little testified that he was able to be a member of
BWSC because he handled Barron’s properties in the area. Regarding the transfer of BWSC in
2017, Little stated that no members were denied any rights or privileges because no resident had
completed the steps necessary to become a member by obtaining a membership certificate. Little
stated that he made copies of the BWSC’s records but returned them to BWSC. Little admitted
that he drafted the bill of sale for the backhoe, that he received the $28,500 payment, and that he
endorsed the $10,000 cashier’s check from BWSC. Regarding the payments that were made by
BWSC, Little explained that only a majority of the board had to approve the transactions, that a
majority approved all of the expenditures, and that it did not matter if one or more of the
directors were interested parties in the transactions.
After considering the evidence, the jury convicted Little of misapplication of
fiduciary property. Little appeals his conviction.
18
DISCUSSION
In his first four issues on appeal, Little challenges the sufficiency of the evidence
supporting his conviction. Specifically, Little asserts that there was insufficient evidence to
establish that BWSC was at a substantial risk of losing at least $30,000, that the $16,000
payment to him from BWSC’s account constituted criminal conduct, that he acted on his own or
as a party to the offense with the requisite intent to commit an offense, and that he misapplied
currency as alleged in the indictment. In his final issue, he contends that the trial court erred by
allowing the State to amend the indictment. Because his first three issues present related
arguments, we will address those issues together before addressing the remaining issues.
Sufficiency of the Evidence
Evidence Concerning Misapplied Property and Intent
“Evidence is sufficient to support a criminal conviction if a rational jury could
find each essential element of the offense beyond a reasonable doubt.” Stahmann v. State,
602 S.W.3d 573, 577 (Tex. Crim. App. 2020) (citing Jackson v. Virginia, 443 U.S. 307, 319
(1979)). In making this determination, “[w]e view the evidence in the light most favorable to
the verdict and consider all of the admitted evidence, regardless of whether it was properly
admitted.” Id. “The jury is the sole judge of credibility and weight to be attached to the
testimony of the witnesses.” Id. “Juries can draw reasonable inferences from the evidence so
long as each inference is supported by the evidence produced at trial,” id., and are “free to
apply common sense, knowledge, and experience gained in the ordinary affairs of life in drawing
reasonable inferences from the evidence,” Eustis v. State, 191 S.W.3d 879, 884 (Tex. App.—
Houston [14th Dist.] 2006, pet. ref’d). “When the record supports conflicting inferences, we
19
presume that the jury resolved the conflicts in favor of the verdict and defer to that
determination.” Merritt v. State, 368 S.W.3d 516, 525-26 (Tex. Crim. App. 2012).
Appellate courts must “determine whether the necessary inferences are reasonable
based upon the combined and cumulative force of all the evidence when viewed in the light
most favorable to the verdict.” Hooper v. State, 214 S.W.3d 9, 16-17 (Tex. Crim. App. 2007).
Appellate courts also must bear in mind that “direct and circumstantial evidence are treated
equally” and that “[c]ircumstantial evidence is as probative as direct evidence in establishing
the guilt of an actor” and “can be sufficient” on its own “to establish guilt.” Kiffe v. State,
361 S.W.3d 104, 108 (Tex. App.—Houston [1st Dist.] 2011, pet. ref’d). The evidence is legally
insufficient if “the record contains no evidence, or merely a ‘modicum’ of evidence, probative of
an element of the offense” or if “the evidence conclusively establishes a reasonable doubt.” Id.
at 107 (quoting Jackson, 443 U.S. at 320).
Under the Penal Code, a person commits the offense of misapplication of
fiduciary property if the person “intentionally, knowingly, or recklessly misapplies property he
holds as a fiduciary . . . in a manner that involves substantial risk of loss to the owner of the
property or to a person for whose benefit the property is held.” Tex. Penal Code § 32.45(b).
The term “[f]iduciary” includes “an officer, manager, employee, or agent carrying on fiduciary
functions on behalf of a fiduciary.” Id. § 32.45(a)(1); see also Southwest Livestock & Trucking
Co. v. Dooley, 884 S.W.2d 805, 809 (Tex. App.—San Antonio 1994, writ denied) (explaining
that “[c]orporate officers and directors” have fiduciary relationship with corporation). In this
context, the term “‘[m]isapply’ means deal with property contrary to: (A) an agreement under
which the fiduciary holds the property; or (B) a law prescribing the custody or disposition of the
property.” Tex. Penal Code § 32.45(a)(2). Further, under the Business Organizations Code, a
20
director, officer, or member of a nonprofit may not receive payment from the corporation’s
income but may receive payment for services provided to the corporation. Tex. Bus. Orgs.
Code §§ 22.053-.054.
Moreover, as specified in the jury charge in this case, “[a] person is criminally
responsible as a party to an offense if the offense is committed by his own conduct, by the
conduct of another for which he is criminally responsible, or by both,” Tex. Penal Code § 7.01,
and “[a] person is criminally responsible for an offense committed by the conduct of another if
. . . acting with intent to promote or assist the commission of the offense, he solicits, encourages,
directs, aids, or attempts to aid the other person to commit the offense,” id. § 7.02(a)(2). “To
prove the intent-to-promote-or-assist element, the State must show that it was the defendant’s
conscious objective or desire for the primary actor to commit the crime.” Metcalf v. State,
597 S.W.3d 847, 856 (Tex. Crim. App. 2020). When reviewing the record for evidence of intent,
appellate courts look to events occurring before, during, or after the offense. Id.The indictment in this case alleged that from October 18, 2018, and continuing to
December 16, 2019, Little, “pursuant to one scheme and continuing course of conduct,”
“intentionally, knowingly, and recklessly” misapplied United States currency “of the value of
$30,000 or more but less than $150,000” that he “held as a fiduciary” contrary to provisions of
the Business Organization Code governing disposition of that property “and in a manner that
involved substantial risk of loss to the members of the Barnhart Water Supply Corporation, the
owners of the property, and the persons for whose benefit the property was held, by making
and receiving personal payments with said United States currency, not in conformity with
the corporation’s purposes.” Further, the indictment listed the payments made or received
as follows:
21
Institution Acct Date Ref Payee Description Credit Debit Memo Line Signatory
Wells Fargo xxxx 9/5/2019 xxxx Barron check deposit 28,500.00 Reimbursement
for backhoe
Wells Fargo xxxx 9/5/2019 xxxx Little check paid 28,500.00 Lawyer fees Barron
Security Bank xxxx 10/31/2019 xxxx Little check paid 5,000.00 Attorney at Law Barron
October Litigation
Security Bank xxxx 11/1/2019 xxxx Barron withdrawal 10,000.00 Barron
Security Bank xxxx 12/10/2019 xxxx Little check paid 1,000.00 Barron
Total: 44,500.00
In his first issue, Little asserts that the evidence is insufficient to support his
conviction for misapplication of fiduciary property valued at $30,000 or more but less than
$150,000 because the evidence does not establish that BWSC was at substantial risk of losing at
least $30,000. See Tex. Penal Code § 32.45. More specifically, he contends that there is
insufficient evidence to support a determination that he misapplied the $28,500 alleged in the
indictment. Building on this premise, he asserts that this differential and the remaining value of
the funds allegedly misapplied ($16,000) could not support a misapplication of more than
$30,000 and that, therefore, the evidence was insufficient to support his conviction.
Relatedly, in his second issue on appeal, Little contends that the evidence was
insufficient to support his conviction because the evidence did not establish “any criminal
conduct in payment of $16,000 in BWSC funds to” him. When presenting this issue, he does not
dispute that the evidence showed that a $5,000 check from October 2019, a $10,000 cashier’s
check from November 2019, and a $1,000 check from December 2019 were written on the
BWSC account; that those checks correspond to three of the checks alleged in the indictment; or
that he received the $16,000. Instead, he asserts that the evidence showed that the checks were
written after the civil suit was filed by residents seeking control over BWSC, that Barron’s
22
testimony established that those checks were written on behalf of BWSC for attorney’s fees, and
that Barron and he as directors had the discretion to use BWSC’s money to fund a defense
against the civil suit. Further, Little argues that BWSC was required to defend itself in the
lawsuit and could pay him a reasonable fee for providing his legal services, that he could also
represent and defend Barron in the proceeding in Barron’s capacity as director, and that the
fees he was paid were reasonable. See Tex. Bus. Orgs. Code §§ 8.104, 22.054; Tex. Water
Code § 67.013. Additionally, Little contends that no evidence was introduced indicating that the
$16,000 “was expended for anything besides attorney[’s] fees.”
In his third issue, Little argues that the evidence was insufficient to support his
conviction because the evidence failed to show that he had the requisite intent to commit an
offense. As support for this argument, he notes that no evidence was presented showing that he
was present when Barron asked Baumann to write him a check, that he was present when Barron
wrote the $28,500 check from BWSC’s account after Baumann refused to help, or that he was
involved in the process of writing and cashing that check. Similarly, Little emphasizes that the
check that Barron subsequently wrote from his personal account to Little noted that the money
was for attorney’s fees, that there was no testimony indicating that Little was present when
Barron wrote that check or knew where the funds came from, and that Barron testified that it was
his decision to sell the backhoe to BWSC. Regarding the bill of sale prepared by him and the
email in which he informed Barron that he voted to approve the purchasing of the backhoe, Little
contends that the bill of sale sufficiently set out the value of the backhoe and could not support
an inference that he knew of any “fraud underlying the transaction.” Further, Little contends that
there was nothing unusual about Barron paying him by check for legal services because the
evidence showed that Barron wrote several checks to him, including some for attorney’s fees.
23
Building on this foundation, Little asserts that there was insufficient evidence to
establish his guilt as a primary actor for the misapplication of the $28,500 taken by Barron.
Regarding the law of parties, Little contends that the evidence was also insufficient because the
State had the burden but failed to prove that he had the “specific intent to commit the result of
the offense, which is misapplying property in a manner that involves substantial risk [of loss] to
the BWSC.” More specifically, he argues that the State failed to show that he participated in an
alleged offense or did any act evidencing “his intent that an offense be committed,” meaning that
the funds be misapplied. Additionally, he contends that the evidence did not establish that he
had any intent to facilitate the offense before Barron committed any alleged misapplication and
that evidence regarding events occurring after the alleged misapplication could not serve to
establish any culpable intent. For all these reasons, Little urges that his conviction should be
reversed and that this Court should render a judgment of acquittal.
As an initial matter, we note that Lisson, who testified as an expert on nonprofit
corporations, explained that if a lawyer wants to have a nonprofit pay attorney’s fees, the lawyer
should set up a retainer agreement specifying the terms of the representation, the lawyer’s fees,
and the scope of the lawyer’s duty. Although Little produced an invoice, no record regarding
any retainer agreement or a resolution agreeing to pay attorney’s fees was presented at trial, and
witnesses testified that BWSC’s records do not provide any information regarding any alleged
service performed by him on behalf of BWSC. Further, Little and Barron both testified that they
returned all records in their possession to BWSC.
Additionally, Lisson testified that anyone who receives service from a water
supply corporation is a member of that corporation and that the assets of a water supply
corporation must be used solely to benefit the corporation and its members. Moreover, the
24
original articles of incorporation explained that the purpose of BWSC was to furnish water to
individuals residing in Barnhart and to the surrounding rural area, and the original bylaws
specified and witnesses testified that anyone owning or having a right to occupy property in the
governing area has the right to become a member by paying a membership fee used for
connecting to the BWSC system. The evidence also showed that the residents of Barnhart and
surrounding areas were customers of BWSC and were connected to the system, and the jury was
free to infer from this evidence that the residents were members of BWSC. In addition, the
bylaws stated that even if the bylaws were subsequently amended by a vote of the members, the
bylaws could not be amended to deprive any members of his or her rights as a member.
Despite the language of the bylaws and articles of incorporation and the fact
that multiple residents were receiving water service from BWSC, Little drafted a resolution
identifying Barron, Smith, and him as the only members of BWSC and transferring authority and
control over its assets to them without a vote by the residents. Smith testified that Little never
mentioned that he was going to prepare a document naming Barron, Smith, and Little as the only
members. The resolution effectively deprived the residents of their rights as members of BWSC.
Moreover, although there was conflicting evidence, two of the previous directors testified that
they did not sign the unanimous resolution. In addition, Little testified that he personally drafted
his own membership certificate as well as the membership certificates for Barron and Smith.
Similarly, prior to the alleged misapplication of money, Little drafted and voted to approve
amended bylaws giving Barron the power to sign checks on behalf of BWSC without the need
for another officer or director’s approval. The amended bylaws also named Barron, Smith, and
Little as officers and directors even though Little did not receive water service from BWSC and
even though the bylaws were not voted on by the residents. Further, as set out previously, on the
25
recording of the October meeting, Little stated that the former board sold away the residents’
rights to control BWSC, that the customers were not members, and that Barron and he were
“lining our pockets.”
Additionally, the auditor with the Attorney General’s Office, Downman, testified
that BWSC typically spent money on vendors, maintenance, and a salary for the bookkeeper but
that the expenditures changed when Barron and Little became directors. Specifically, Downman
related that BWSC started paying for things that seemed unrelated to BWSC’s purposes.
Moreover, regarding the backhoe sale, Downman explained that on the same day that Barron
received $28,500, he wrote Little a check for the same amount ostensibly for attorney’s fees.
However, Downman testified that there were no legal events involving BWSC at that time and
that Barron had previously hired Little to defend him in his aggravated-assault case but had not
paid him for those services. Moreover, evidence presented at trial, including Barron’s testimony,
established that the payment of the $28,500 at that time was unusual because Barron had in the
past paid attorney’s fees when legal services were rendered.
In addition, although Barron testified that he purchased the backhoe to help
facilitate BWSC’s purposes, other evidence was introduced contradicting that assertion. For
example, the current president of BWSC, Barrera, testified that Barron used BWSC funds to
purchase the backhoe after he was unable to sell it for several months, that the purchase was a
waste of money for BWSC because it rarely needs to use that type of equipment and can rent the
equipment when needed or rely on one of the residents to donate their equipment for a project,
that BWSC did not use the backhoe after Barron sold it, that BWSC had no place to store the
backhoe, and that the backhoe deteriorated while outside. In addition, Smith, who was the third
director with Barron and Little, testified that Barron used the backhoe on his personal property
26
and that Barron used the backhoe for his personal use as well as for BWSC purposes. Similarly,
the former bookkeeper, Baumann, explained that Barron instructed her to write him a check from
BWSC’s account for an amount that he specified the backhoe was worth but that the backhoe
was unnecessary because their water system was new and because residents would donate their
time and equipment for water projects.
Regarding Little, Baumann testified that he informed her by email that Barron and
he authorized the purchase and transfer of the funds as directors and that he terminated her
employment after she refused to write Barron the check without approval by the residents. In the
email Little wrote to Barron attaching a bill of sale for the backhoe, Little wrote that he voted
in favor of the acquisition, and the attached bill of sale stated that the purchase price was
$28,500. However, Baumann related that an individual who sells backhoes informed her that the
backhoe was not worth the price suggested by Barron and that the bill of sale did not provide
enough information to determine its value or its condition. The current secretary for BWSC,
Kuykendall, explained that BWSC rarely had to use equipment and that Barron used the backhoe
on his personal property. Further, Barron wrote a check to Little for the exact same amount on
the same day that Barron deposited the funds.
In his testimony, Barron admitted that he wrote himself a check from BWSC’s
account to purchase the backhoe because he needed money for back surgery, that he wrote a
check to Little for the same amount on the same day, that he did not remember if he paid Little
for defending him in the aggravated-assault case, that the $28,500 check may have been
compensation for Little representing him in the criminal case, and that there was no legal
business related to BWSC occurring at that time. Moreover, Little admitted that he fired
27
Baumann and received those funds after preparing the bill of sale for the backhoe, and he
testified that Barron did not have any money of his own at the time.
Regarding the $16,000 that Little asserts were payment for attorney’s fees for the
civil lawsuits, we note as set out above that there was no retainer or other agreement in BWSC’s
records approving the payment of fees or setting out the terms of Little’s representation, the
scope of the representation, or the manner in which he would be compensated. Moreover, as
discussed above, Little drafted the resolution and amended bylaws giving Barron and himself
authority over BWSC’s assets, and Little stated during the meeting with the residents that Barron
and he took over BWSC to “lin[e] our pockets” before accepting the $16,000. In addition,
regarding the civil suit initiated by the residents of Barnhart who were customers of BWSC,
evidence was presented showing that the suit was prompted when BWSC funds were used to
purchase the backhoe and that the suit was filed to prevent Barron and Little from draining
any more of BWSC’s assets. However, prior to an injunction being issued, Barron continued to
make withdrawals from BWSC’s account and transfer the money to Little. Further, evidence
showed that after the customers filed suit, Little filed suit against the customers of BWSC on
behalf of Barron and BWSC, and the jury could reasonably infer that this lawsuit was not
consistent with BWSC’s purpose of providing water service to the residents of Barnhart.
Additionally, Barron admitted that he did not know if the $10,000 cashier’s check was issued for
the benefit of BWSC or its members.
Based on the preceding, we must conclude that a reasonable jury could have
determined that Barron intentionally, knowingly, or recklessly misapplied BWSC’s property
with a value of more than $30,000 but less than $150,000 that he held as a fiduciary, that the
misapplication involved a substantial risk of loss of the funds to BWSC, that the misapplication
28
occurred in a manner that was not necessary or consistent with BWSC’s purpose of providing
water service to the residents of Barnhart, and that the misapplication was inconsistent with the
directives of the Business Organizations Code provisions prohibiting officers and directors from
receiving profits from a nonprofit organization. See Tex. Bus. Orgs. Code §§ 22.053-.054; Tex.
Penal Code § 32.45. Further, we also conclude that a reasonable jury could have determined that
Little acted with the intent to promote or assist the misapplication of the property and aided
Barron to commit the offense and was, therefore, liable under the law of parties. See Tex. Penal
Code § 7.02(a)(2); see also Amaya v. State, 733 S.W.2d 168, 174 (Tex. Crim. App. 1986)
(explaining that individual can be held accountable as party where there is “indication that they
knew that they were assisting in the commission of an offense”).
In his first issue, Little presents another argument regarding the $28,500.
Specifically, Little notes that Barron sold the backhoe to BWSC for $28,500 and argues that at
the point of sale, the backhoe became the property of BWSC and one of its assets as listed in the
settlement agreement executed. Further, Little emphasizes that the backhoe was later sold for
$24,000. In light of the preceding, Little contends that at most there is a price differential of
$4,500, that the only risk to BWSC was the loss of this differential, and accordingly that the full
value of the backhoe could not have been misapplied. Building on this premise, Little asserts
that this differential and the remaining value of the funds allegedly misapplied ($16,000)
could not support a misapplication of more than $30,000 and that, therefore, the evidence was
insufficient to support his conviction. Further, Little contends that unlike theft, which requires
proof of an intent to deprive rather than an actual deprivation, see Tex. Penal Code § 31.03,
misapplication of fiduciary property requires a completed misapplication.
29
Although Little suggests that there should be some sort of offset if an entity
whose property has been misapplied is able to recoup some value following the misapplication,
he has not referred to any cases supporting his interpretation of the statute, and the language of
the statute is not amenable to that interpretation either. Cf. Liverman v. State, 470 S.W.3d 831,
836 (Tex. Crim. App. 2015) (noting that “[i]n some cases, . . . a sufficiency-of-the-evidence issue
turns on the meaning of the statute under which the defendant has been prosecuted” and that
“[t]hat question, like all statutory construction questions, is a question of law, which we review
de novo”). As set out above, an individual commits the offense of misapplication of fiduciary
property if he misapplies property “in a manner that involves substantial risk of loss to the owner
of the property or to a person for whose benefit the property is held” and specifies that the
offense is a third-degree felony “if the value of the property misapplied is $30,000 or more but
less than $150,000.” Tex. Penal Code § 32.45(b), (c)(5). The language of the statute focuses on
the manner in which the alleged offender handled the property rather than requiring an accounting
to determine if the victim was able to recoup some value following the misapplication.
This construction is consistent with how the Court of Criminal Appeals has
construed the phrase “substantial risk of loss” and with the way courts have addressed the issue
of recoupment for similar offenses. In Casilias v. State, the Court of Criminal Appeals explained
that “substantial risk of loss” implies “a ‘real possibility’ of loss,” meaning one that “exists but
does not rise to the level of a substantial certainty.” 733 S.W.2d 158, 164 (Tex. Crim. App.
1986). In other words, it does not have to be “‘unlikely’ that the property will be recovered, but
the risk of loss does have to be a positive possibility,” meaning “more likely than not.” Id.;
Black v. State, 551 S.W.3d 819, 831 (Tex. App.—Corpus Christi-Edinburg 2018, no pet.)
(explaining that statute only requires proof of substantial risk of loss to owner, “not actual loss,”
30
and that jury could infer that initiating transaction placed funds at substantial risk of loss even
though transactions were ultimately undone). However, the Court also clarified that the amount
of proof needed to satisfy “the substantial risk of loss” is less than what is needed to show
that someone had been “deprive[d]” of property in a theft offense where the alleged offender
intended to dispose of property in a manner making its recovery “unlikely.” Casilias, 733 S.W.2d
at 164 (discussing section 31.01 of Penal Code pertaining to theft offenses).
Moreover, although Little focuses on the “intent to deprive” element for theft
offenses to distinguish it from misapplication offenses, theft still requires that the defendant
“unlawfully appropriate[] property” by bringing about a transfer of the title or other
nonpossessory interest in the property or acquire or exercise control over the property, see Tex.
Penal Code §§ 31.01(4), .03, which is similar to the requirement for the offense in question that
the person misapply the property, see id. § 32.45. Additionally, for theft offenses, our sister
court has explained that the later repayment of the money does not render insufficient the
evidence supporting a conviction for theft. See Ellis v. State, 714 S.W.2d 465, 475 (Tex. App.—
Houston [1st Dist.] 1986, pet. ref’d) (holding “that the temporary deprivation of the funds”
supports conviction); see also Griffin v. State, 614 S.W.2d 155, 159 (Tex. Crim. App. 1981)
(explaining that “[t]he fact that the deprivation later became temporary does not automatically
mean that there was no intent to deprive permanently or for so long as to satisfy the statutory
definition”).
Given the construction of the phrase “substantial risk of loss” adopted by the
Court of Criminal Appeals, the Court’s explanation that the evidence needed to establish that
element is less than the evidence needed to establish deprivation of property for theft offenses,
and the legal determination by courts establishing that the repayment or recoupment of funds
31
does not render evidence insufficient to support a conviction for similar offenses, we conclude
that the evidence establishing that BWSC was able to sell the backhoe for $24,000 does not
without more render the evidence insufficient to support the jury’s determination that Little
misapplied property in a manner creating a substantial risk that BWSC would lose $30,000
or more but less than $150,000 of its funds. Cf. Demond v. State, 452 S.W.3d 435, 448 (Tex.
App.—Austin 2014, pet. ref’d) (observing that even if defendant provided some value, jury
could still infer that defendant misapplied funds).
For all these reasons, we overrule Little’s first three issues on appeal.
Evidence Concerning Currency
In his fourth issue on appeal, Little notes that the indictment alleged that he
misapplied “property, namely United States Currency, of the value of $30,000 or more but less
than $150,000”; however, he contends that the evidence from trial showed that “the means of
misapplication of fiduciary property” for some of the property was executed “by [a] check drawn
on the [BWSC] account made payable to Michael Barron” for $28,500. After emphasizing the
evidence pertaining to the check made out to Barron, Little contends that he “did not have any
signatory authority over the BWSC account or Barron’s bank account” and, therefore, “never
had any control over the misappropriated funds” because he did not and could not have cashed
the check misappropriating money. Although Little concedes that a person “who converts a
check made out to him into cash could certainly be said to exercise control over the currency
represented by the check,” he asserts that did not happen in this case because the “check was
made out to a third party passed through the third party’s hands and then allegedly to [him] in the
form of another check.” “In other words,” Little argues that he “may have exercised control over
32
a subsequent check, but not the currency represented by the original check to Barron,” did
not misapply the currency as alleged, and could not have exercised “control over the [original]
check to the extent that it could be treated as money.” Relatedly, Little contends that because the
State alleged the misappropriation of “United States Currency” as opposed to cash or money, this
case presents a different situation than other appellate cases concluding that a person who
exercises control over a check also exercises control over the money it represents. Little asserts
that although BWSC may have had assets of value, there was no evidence that it “held any
‘United States Currency’ that [he] exercised control over.” Moreover, Little urges that the
variance between the allegations and the evidence at trial renders the evidence insufficient to
support his conviction and requests that this Court reverse his conviction and render a judgment
of acquittal.
As an initial matter, we note that “courts have repeatedly held that there is
no variance between an indictment that alleges theft of ‘money’ and proof at trial that
establishes theft of a ‘check.’” See Chachere v. State, 811 S.W.2d 135, 136 (Tex. App.—
Houston [1st Dist.] 1991, pet. ref’d); see also Jackson v. State, 646 S.W.2d 225, 226 (Tex. Crim.
App. 1983) (overruling sufficiency challenge arguing evidence was insufficient because
indictment alleged theft of money but evidence showed theft of check that had been cashed by
defendant); Grogen v. State, 745 S.W.2d 450, 451 (Tex. App.—Houston [1st Dist.] 1988, no
pet.) (same). This is because “a check is considered the same as cash” in most cases “due to the
ease of negotiating the check into cash,” Chachere, 811 S.W.2d at 136, and due to the fact that
checks are simply the instrumentality by which someone receives cash, Jackson, 646 S.W.2d
at 226; Kirkpatrick v. State, 515 S.W.2d 289, 293 (Tex. Crim. App. 1974). Moreover, in this
case, the indictment specified that the “making and receiving” of the currency was effectuated
33
through the five checks discussed above. Cf. Compton v. State, 607 S.W.2d 246, 252 (Tex.
Crim. App. 1979) (on reh’g) (explaining that once defendant negotiates check, he exercises
control over it and its proceeds). Furthermore, although Little contends that there is a significant
distinction between the term “currency” as alleged in the indictment and the terms “money”
and “cash” rendering the above cases and others inapplicable, we do not agree with that
distinction because currency is a synonym for cash and money. See Cash, Currency, and
Money, Thesaurus.com, https://www.thesaurus.com (last visited March 7, 2023); see also
Cash, Dictionary.com, https://www.dictionary.com/browse/cash (defining cash as “money
or an equivalent, as a check”) (last visited March 7, 2023); Currency, Dictionary.com,
https://www.dictionary.com/browse/currency (defining currency as “something that is used
as a medium of exchange; money”) (last visited March 7, 2023); Money, Dictionary.com,
https://www.dictionary.com/browse/money (defining money as “any circulating medium of
exchange, including coins, paper money, and demand deposits” and “checks”) (last visited
March 7, 2023).
Accordingly, to the extent that Little is asserting that there is a variance between
the allegations in the indictment and the proof offered at trial because the indictment alleged
misapplication of currency rather than misapplication of checks, money, or cash, we cannot
agree with Little’s assertion that the alleged variance renders the evidence presented insufficient
to support his conviction. Moreover, as set out above, the jury charge included instructions on
the law of parties, and for the reasons discussed previously, the evidence was sufficient to allow
the jury to reasonably infer that Little acted with the intent to promote or assist Barron in the
misapplication of BWSC’s property, including the $28,500 in funds transferred from BWSC to
Barron, and aided Barron to commit the offense. See Tex. Penal Code § 7.02(a)(2); see also
34
Ammons v. State, 782 S.W.2d 539, 541 (Tex. App.—Houston [14th Dist.] 1989, no pet.)
(explaining that “a party to an offense may be charged without alleging facts which make the
defendant a party to the offense and criminally responsible for the conduct of another” and
noting “that an indictment which does not give reference [to] the law of parties does not present
a constitutional infirmity”).
For these reasons, we overrule Little’s fourth issue on appeal.
Indictment Amendment
In his final issue on appeal, Little asserts that the trial court erred by allowing the
State to amend the indictment. Specifically, he notes that the trial court agreed to amend the
indictment by adding language stating that the allegedly improper payments made and received
were “particularly described on Attachment A” and attaching to the indictment a list of the five
checks discussed above. However, Little asserts that the amendment was improper because the
incorporation of the list of checks in Attachment A was not part of the face of the indictment, an
interlineation of the original indictment, or an amended photocopy of the original indictment.
Instead, he contends that Attachment A was a separate document that was not part of the
indictment and, therefore, could not be considered a valid amendment. Further, he argues that
the trial court’s authorization of the amendment harmed him because the amendment “goes to the
heart of the contested issues” at trial, which he contends were the amount of money allegedly
misapplied, whether he had the requisite intent to commit an offense, and whether there had been
a misapplication. Additionally, he contends that the invalidly amended indictment did not allow
him to prepare a defense prior to trial and allows for the possibility of him being prosecuted
35
again for the same offense. Accordingly, Little asserts that this Court should reverse his
conviction and remand the case with instructions for the trial court to dismiss the case.
In response to the State’s motion to amend the indictment, Little filed a reply
asserting that the proposed amendments did not provide him notice of what he was accused, that
the shorter time period identified in the attachment in which the allegedly improper transfers
occurred was not consistent with the longer time period alleged in the indictment, and that the
amended indictment did not inform him how he acted recklessly. Little also argued that the
payments he received were for reasonable attorney’s fees and reasserted his claim from earlier
motions that the trial court should quash the indictment. During the hearing on the State’s
motion to amend, Little’s motion to quash, and other motions, Little asserted that indictment did
not specify how he recklessly spent the allegedly misapplied money, that the amount of money
allegedly misapplied fell below the $30,000 minimum listed in the indictment, that the evidence
will show that he did not misapply money, and that the State failed to comply with various
discovery requests. However, Little did not make any assertion regarding the propriety of
amending the indictment to include Attachment A.
Under article 1.14 of the Code of Criminal Procedure, a defendant “waives and
forfeits the right to object” “to a defect, error, or irregularity of form or substance in an
indictment” and “may not raise the objection on appeal” if he “does not object to [the] defect,
error, or irregularity . . . before the date on which the trial on the merits commences.” Tex. Code
Crim. Proc. art. 1.14(b); see Jones v. State, 907 S.W.2d 850, 857 (Tex. App.—Houston [1st
Dist.] 1995, pet. ref’d); see also Ex parte Jessep, 281 S.W.3d 675, 680 (Tex. App.—Amarillo
2009, pet. ref’d) (noting that “[t]he statute serves the purpose of ensuring that indictment defects
may be objected to and repaired pretrial but would not invalidate an otherwise valid conviction if
36
not raised before trial”). Little’s complaint concerns an alleged “defect, error, or irregularity
of form or substance in the” amended indictment, and he was therefore “required to raise an
objection prior to trial.” Jones, 907 S.W.2d at 858. By failing to object before trial to the
allegedly improper amendment on the grounds presented on appeal, Little is prohibited from
presenting those arguments here. See Tex. Code Crim. Proc. art. 1.14(b); Tex. R. App. P. 33.1;
Duffy v. State, 33 S.W.3d 17, 26 (Tex. App.—El Paso 2000, no pet.); see also Jenkins v. State,
592 S.W.3d 894, 902 (Tex. Crim. App. 2018) (recognizing that Texas law requires defendant to
object to any error in indictment before trial).
Even if Little’s objections could be construed as attacking the propriety of
amending the indictment to include Attachment A, we would be unable to sustain his fifth
issue. The Court of Criminal Appeals has explained that making interlineations in the original
indictment is an acceptable but not exclusive way to properly amend an indictment and expressly
overruled prior cases requiring actual physical interlineation of the original indictment. See
Riney v. State, 28 S.W.3d 561, 565-66 (Tex. Crim. App. 2000). In that case, the Court also
approved the filing of an interlineated photocopy of the indictment. Id. In light of the analysis
from Riney, our sister court has interpreted the case “as allowing flexibility in amending
indictments provided that the method of amendment employed produces an amended copy
of the indictment incorporated into the record under the direction of the trial court sufficient
to give the defendant fair notice of the charges,” see Harrison v. State, No. 05-07-00453-CR,
2008 WL 2514333, at *1 (Tex. App.—Dallas June 25, 2008, no pet.) (op., not designated for
publication), and we agree with that interpretation, see Tex. Code Crim. Proc. art. 28.11
(explaining that indictment amendments “shall be made with the leave of the court and under
its direction”).
37
In this case, the State set out the proposed changes in its motion to amend,
including Attachment A, and the proposed amendment to the indictment was approved by the
trial court after it was discussed during a hearing in which the parties were given the opportunity
to present argument regarding the propriety of the proposed changes. Like the original
indictment, the amended indictment was made part of the clerk’s record. As discussed above,
the proposed changes included Attachment A and the interlineations made to a copy of the
indictment clarifying that the allegedly improper payments made and received were described
in Attachment A. Both the interlineation on the copy of the indictment and Attachment A bear
the trial judge’s initials and date of the modification. On this record, we conclude that the
amendments met the objectives for an amendment set out in Riney. See Barfield v. State,
202 S.W.3d 912, 920-21 (Tex. App.—Texarkana 2006, pet. ref’d) (upholding amendment made
by attaching copy of language from State’s motion to order granting amendment and stating
“SEE ATTACHED” in order); Westmoreland v. State, 174 S.W.3d 282, 287 (Tex. App.—Tyler
2005, pet. ref’d) (concluding that trial court’s order granting State’s motion to amend was
sufficient to amend indictment where State’s motion included original indictment language
and proposed changes, where defendant was present at hearing and had notice of amendment,
and where order granting motion included amended language to original indictment requested
by State).
For these reasons, we overrule Little’s fifth issue on appeal.
CONCLUSION
Having overruled Little’s five issues on appeal, we affirm the trial court’s
judgment of conviction.
38
__________________________________________
Thomas J. Baker, Justice
Before Justices Baker, Kelly, and Smith
Affirmed
Filed: March 9, 2023
Do Not Publish
39