Case Title: Application of Allied Fidelity Ins. Co.

Citation: 

Docket Number: 83-6

State: wyoming

Court: Wyoming Supreme Court

Date: 1983-06-17T00:00:00Z

Document:
Application of Allied Fidelity Ins. Co.1983 WY 69664 P.2d 1322Case Number: 83-6Case Number: 83-6Decided: 06/17/1983Supreme Court of Wyoming
IN THE MATTER OF 
APPLICATION OF ALLIED FIDELITY INSURANCE COMPANY, AN INDIANA CORPORATION, FOR 
REMISSION OF A JUDGMENT OF BOND FORFEITURE. ALLIED FIDELITY INSURANCE COMPANY, 
APPELLANT (PETITIONER),

v.

THE STATE OF WYOMING, FOR THE USE AND BENEFIT OF THE CARBONCOUNTYSCHOOL 
DISTRICT, APPELLEE 
(RESPONDENT).

Appeal from the District 
Court, CarbonCounty, Robert A. Hill, 
J.

Charles John 
Szlenker, Cheyenne, for appellant.

A.G. McClintock, 
Atty. Gen., Gerald A. Stack, Deputy Atty. Gen., John W. Renneisen, Sr. Asst. 
Atty. Gen., and Michael L. Hubbard, Asst. Atty. Gen., Cheyenne, for appellee.

Before ROONEY, C.J., and RAPER,* THOMAS, ROSE and BROWN, 
JJ.

* Retired June 13, 1983, 
but continued to participate in the decision of the court in this case pursuant 
to order of the court entered June 13, 1983.

ROSE, 
Justice.

[¶1.]     This case presents for 
our review a question concerning the right of the State to order forfeiture of 
an appearance bond and the failure of the district court to order adequate 
remission of the forfeited amount.

[¶2.]     Appellant Allied 
Fidelity Insurance Company (hereinafter referred to as Allied) engages in the 
business of writing and securing bail bonds for criminal defendants. On December 
8, 1981, Allied, through its agent, Floyd Hunt, co-signed an appearance bond as 
surety in the amount of $35,000 for the benefit of a criminal defendant, William 
Grubbs. This bond permitted the defendant to enjoy his freedom while awaiting 
trial on the conditions that Mr. Grubbs not leave the state, not possess a 
firearm, not associate with a Mr. Steven Ervin, and that he be present at all 
court-ordered appearances. The defendant complied with these restrictions and 
was subsequently found guilty of the charged offenses.

[¶3.]     After return of the 
verdict, the court ordered a presentence investigation and continued the 
defendant's bond although the amount was raised to $60,000. This second bond 
incorporated the first one and Allied executed an additional surety bond in the 
amount of $25,000 which, along with the first $35,000 bond, raised the total 
amount guaranteed by Allied to $60,000. The second bond contained the following 
conditions:

"The Defendant shall not 
leave the State of Wyoming for any reason or purpose whatsoever without first 
having obtained permission in writing from the District Court, Second Judicial 
District in and for Carbon County, Wyoming. The Defendant shall not at any time 
be in possession of any type of firearms whatsoever."

[¶4.]     Prior to sentencing, 
and while still at liberty as a result of the bond, defendant Grubbs left 
Wyoming and subsequently was arrested for an 
armed robbery in Fort 
Collins, Colorado. At 
the time of the challenged proceedings, Grubbs remained in the custody of 
Colorado 
authorities.

[¶5.]     As a result of the 
defendant's breach, the State requested and was granted a forfeiture of the 
$60,000 bond. Appellant Allied then initiated an action pursuant to Rule 
8(e)(4), W.R.Cr.P.,1 for remission of the amount 
forfeited. After hearing, the district judge ordered that $20,000 of the $60,000 
be remitted.

APPELLANT'S 
CONTENTIONS

[¶6.]     Appellant brings this 
appeal for purposes of challenging the district court's decision to remit only 
$20,000 of the bond. It is Allied's position that the district court failed to 
consider certain factors in entering the order of partial remission and that the 
court should have only enforced the forfeiture of the bond to reflect the actual 
costs incurred by the State which resulted from the defendant's breach of the 
bond. Allied also argues in a secondary fashion that its agent, Floyd Hunt, was 
not authorized to obligate the company to insure that William Grubbs would 
remain in Wyoming and not possess a firearm, but only that he would be present 
at all court-ordered appearances. We disagree with both of Allied's contentions 
and we will affirm.

AUTHORITY OF ALLIED'S 
AGENT

[¶7.]     As previously noted, 
the appellant's agent, Floyd Hunt, executed the surety bonds on behalf of 
Allied. Attached to both documents was a power of attorney drafted by Allied 
which contained the following statement:

"* * * [T]o execute, seal 
and deliver for and on its behalf and as its act and deed, as surety, a bail bond only. Authority of such 
Attorney-in-Fact is limited to appearance bonds and cannot be construed to 
guarantee for failure to provide payments, back alimony payments, fines or wage 
law claims, on behalf of below named defendant." (Emphasis 
added.)

According to 
Allied, this statement expressly limited Hunt's authority to contractually 
obligate the company to insure the defendant's appearance only, and therefore 
the other conditions incorporated in the bond were not enforceable against them. 
The district judge rejected this contention and we agree with that 
disposition.

[¶8.]     In Miller v. State, Wyo., 560 P.2d 739, 
741-742 (1977), we noted that under Rule 8, W.R.Cr.P., the amount and conditions 
imposed by the district court in allowing a defendant to be released on bond are 
matters entrusted to the discretion of the court. It is also the law that even 
though the purpose of bail is to insure defendant's presence at court 
proceedings without excessively restricting his or her liberty, a common 
condition imposed upon release is that defendant remain within the court's 
jurisdiction and act in a law-abiding manner. State v. Cassius, 110 Ariz. 485, 520 P.2d 1109 (1974).

[¶9.]     Another general rule 
applied by courts in bail bond cases is that a bail bond is a contract entered 
into between the government, the principal, and the surety, United States v. Skipper, 633 F.2d 1177 
(5th Cir. 1981); United States v. 
Martinez, 613 F.2d 473 (3rd Cir. 1980); State v. Emery, 12 Or. App. 37, 504 P.2d 1405 (1973), and as such the bond and conditions contained therein are to be 
construed within the four corners of the instrument to determine the intention 
of the parties. United States v. 
Parr, 594 F.2d 440 (5th Cir. 1979); State v. Emery, supra; State v. Nelson, 20 Utah 2d 229, 436 P.2d 792 (1968). Thus, the present bond is to be construed in the same manner as 
any other contract.

[¶10.]  Upon application of the above principles, 
we are of the opinion that appellant's argument concerning its agent's lack of 
authority to bind the company to any condition other than defendant's appearance 
borders on being specious. The power of attorney plainly and unambiguously 
states that Floyd Hunt had the authority to execute bail bonds on behalf of Allied and as we 
have already noted, a common condition lawfully imposed by courts is that the 
defendant not leave the jurisdiction. Given this, we find it difficult if not 
impossible to believe that Floyd Hunt was not aware that Allied was insuring 
William Grubbs' conduct. Allied is in the business of writing these surety 
bonds; Allied, through its lawfully empowered agent, entered into the contract; 
and Allied was bound by all of the plainly stated conditions found therein. We 
reject appellant's argument and find that the bonds were valid, enforceable, and 
subject to forfeiture upon William Grubbs' flight to and subsequent criminal 
activity in the state of Colorado.

THE RULE 8(e)(4), 
W.R.Cr.P., ISSUE

[¶11.]  Rule 8(e)(4), W.R.Cr.P., provides means 
whereby a court can remit in "whole or in part" a bond forfeiture "if it appears 
that justice does not require 
enforcement of the forfeiture." (Emphasis added.) See: Rule 8(e)(2) and (4), 
supra n. 1. The Wyoming version of Rule 8, W.R.Cr.P., closely parallels Rule 46, 
F.R.Cr.P., and we will therefore look to federal authorities in resolving 
appellant's second claim.

[¶12.]  Appellant's basic contention is that the 
district court improperly required forfeiture of $40,000 of the $60,000 bond 
because the actual cost to the State of transporting Mr. Grubbs back to Wyoming 
for sentencing was far less than that amount. The parties have also raised 
questions concerning the proper standard of review to be utilized in our review 
of the remission question.

[¶13.]  With respect to the standard-of-review 
question, the answer can be found in a multitude of cases. It is a universal 
rule that the powers vested by the forfeitures provision of a rule similar to 
our Rule 8(e), W.R.Cr.P., are ones entrusted to the exercise of discretion. 
Thus, the decision to grant or deny a remission is a discretionary one that will 
only be overturned on appeal for a patent abuse of discretion amounting to 
arbitrary and capricious action. United 
States v. Jackson, 691 F.2d 478 (11th Cir. 1982); United States v. Vader, 630 F.2d 792 
(10th Cir. 1980), cert. denied 449 U.S. 1037, 101 S. Ct. 616, 66 L. Ed. 2d 500. See 
also: State v. Drake, 6 Or. App. 282, 
487 P.2d 901 (1971); State v. Cotton Belt 
Insurance Company, 97 N.M. 152, 637 P.2d 834 (1981). As stated in United States v. Skipper, supra, 633 
F.2d at 1180:

"* * * The duty rested 
with the district court to make the decision on remission. Our task is only to 
determine whether that decision was arbitrary and capricious, not to substitute 
our discretion for that of the district judge."

[¶14.]  The federal courts have also established 
various guidelines to be utilized in reviewing the district court's exercise of 
discretion in bail-forfeiture and remission matters which we deem adequate. 
These factors were set out in United 
States v. Castaldo, 667 F.2d 20, 21 (9th Cir. 1981):

"Rule 46(e)(1) mandates 
the forfeiture of a bond upon the breach of a bond condition, such as the 
defendant's non-appearance. The rule, however, confers discretion upon the trial 
court to set aside or remit all or part of a forfeiture `if it appears that 
justice does not require the enforcement of the forfeiture.' Fed.R. Crim.P. 
46(e)(2) and (4). A trial court should consider several factors when deciding 
whether to remit or set aside a forfeiture, including 1) the willfulness of the 
defendant's breach of conditions; 2) the participation of the sureties in 
apprehending the defendant; 3) the cost, inconvenience and prejudice suffered by 
the government as a result of the defendant's breach; and 4) any explanation or 
mitigating factors presented by the defendant. See United States v. Stanley, 601 F.2d 380, 
382 (9th Cir. 1979) (per curiam). We will not overturn a trial court's ruling on 
a motion to set aside or remit a forfeiture absent an abuse of discretion. Id. 
at 382."

See also: United States v. Frias-Ramirez, 670 F.2d 849 (9th Cir. 1982), cert. denied ___ U.S. ___, 103 S. Ct. 94, 74 L. Ed. 2d 86. 
Other factors were discussed by the court in United States v. Parr, 
supra:

"The purpose of a bail 
bond is not punitive. Its object is not to enrich the government or punish the 
defendant. Dudley v. United States, 
242 F.2d 656 (5th Cir. 1957); United 
States v. Davis, [202 F.2d 621 (7th Cir. 1953)]. Nor can it be `used as a 
balm to soothe the disappointment resulting from the inability to punish and 
rehabilitate.' [United States v.] Parr, [560 F.2d 1221 (5th Cir. 1971)] at 
1224. The `forfeiture ought to bear some reasonable relation to the cost and 
inconvenience to the government of regaining custody. . . .' [United States v.] Kirkman, [426 F.2d 747 (4th Cir. 1970)], 
the amount of delay caused by the defendants default and the stage of the 
proceedings at the time of disappearance; United States v. Fook Dan Chin, 304 F. Supp. 403, (S.D.N.Y. 1969), the willfulness of the defendant breach of 
conditions and the prejudice suffered by the government, United States v. Nell, 169 U.S.App.D.C. 
380, 515 F.2d 1351 (1975); and the public interest and necessity of effectuating 
the appearance of the defendant. United 
States v. Agueci, 379 F.2d 277 (2nd Cir. 1967). `Neither frustration nor its 
kinsman vindictiveness should be of weight in tipping the scales by which the 
elements of the court's discretion is weighed.' Parr, supra at 1224." 594 F.2d  at 
444.

[¶15.]  Appellant argues that upon an application 
of the above considerations, the record reflects an abuse of discretion on the 
part of the district judge. Allied's main contention is that there is no proof 
to substantiate a finding that $40,000 equals the costs incurred by the 
government as a result of Grubbs' breach. Allied also attempts to argue that 
several relatives of Grubbs, who apparently indemnified Allied, will suffer 
hardship as a result of the forfeiture and that the district court improperly 
failed to consider this factor. We disagree and cannot conclude that the record 
reflects any arbitrary or capricious action on the part of the district court in 
refusing to remit any more than $20,000 of the bond.

[¶16.]  A review of the judge's decision reflects 
that he considered all of the mitigating factors posed by Allied as well as the 
costs claimed to be involved by the State. Upon review of these factors, the 
court chose to remit $20,000 of the forfeited amount and we cannot say that such 
decision reflects a patent abuse of discretion. We are not in the position to 
say whether a $30,000, $40,000 or even a $50,000 remission would have been more 
appropriate, but only whether the $20,000 remission reflects an arbitrary or 
capricious decision not supported by the facts. Given the state of the record, 
we will not overturn the district court's decision. The proper factors were 
considered and the $20,000 remission was far from an arbitrary and capricious 
decision. Moreover, we are of the opinion that the district judge has abided by 
the following standard:

"Discretion cannot be 
exercised `arbitrarily or willfully, but with regard to what is right and 
equitable under the circumstances and the law, and directed by the reason and 
conscience of the judge to a just result.' Langnes v. Green, 282 U.S. 531, 541, 51 S. Ct. 243, 247, 75 L. Ed. 520 (1931) * * *." 594 F.2d  at 
444.

[¶17.]  Finally, appellant contends that 
upholding the $40,000 forfeiture of the bond will have a chilling effect on the 
willingness of companies such as Allied to assist criminal defendants in 
exercising their right to bail. We cannot answer this contention more 
effectively than was done in United 
States v. Castaldo, supra:

"Finally, the appellants' 
policy argument fails. The forfeiture will not have a chilling effect on the 
willingness of bonding companies to help criminal defendants exercise their 
constitutional right to bail. Instead, it will encourage bonding companies to 
ascertain more carefully the value of the security given by defendants, to 
consider the likelihood of the defendant breaching a bond condition, to take 
reasonable precautions to assure the defendant's appearance, and to cooperate 
fully in efforts to reapprehend a defendant who fails to appear." 667 F.2d  at 
22.

[¶18.]  Appellant assumed the risks in this case, 
and through its agent it guaranteed to the court that Grubbs would abide by the 
terms of his conditional-release agreement. The defendant breached those 
conditions and also committed another violent crime while under Allied's 
supervision, at a high cost to the State and society. The trial judge acted 
properly and within his powers.

[¶19.]  Affirmed.

1 The applicable portions 
of Rule 8(e), W.R. Cr.P. provide:

"(e) Forfeiture, enforcement and 
exoneration.

* * * * * 
*

"(2) Setting Aside. - The 
court may direct that a forfeiture be set aside, upon such conditions as the 
court may impose, if it appears that justice does not require the enforcement of 
the forfeiture.

* * * * * 
*

"(4) Remission. - After 
entry of such judgment, the court may remit it in whole or in part under the 
conditions applying to the setting aside of forfeiture in subdivision 
(2)."