### IN THE COURT OF CRIMI NAL AP PEALS OF TENNES SEE AT NAS HVILLE A ssi gne d on Br ie fs Jun e 18, 200 8

STA TE OF TEN NES SEE v. DE BBIE D AWN WAL ES

Direc t Appeal from the Circ uit Court for Giles County No. 12,505 Stella L. Hargrove, Judge

No. M2007- 01231-CCA -R3-C D - F iled 12/11/2008

The De fenda

nt ple d g uilty to the ft of proper ty in e x cess of $60,000, and the trial court sentenc ed her to t e n y e ars in p ri so n a

nd or de re d h e r t o pay

$1 62 ,6 03 in r e sti tut ion . T he De fe nd ant a pp e a ls, claiming t h at t h e restit ution amount is ex cessive. A fter a thoroug h revie w of the r ecor d and
a pp lic a ble law, we a ff

ir m th e jud g me nt o f t

he tr ia l c ourt

. Tenn. R. App . P . 3 Appeal as of Right; Judgme nt of th e Circ uit Court Aff irm ed

R OBER T W. W EDEMEYER , J ., delivere d the opinion of the cour t, in which J ER R Y L. S MI TH and N OR MA M C G EE O G LE , J J ., joined.

Rob e rt H. Sto va ll, Jr., Pul a sk i, T e nn e sse e , f or the Ap pe lla

nt, De bb ie Da

wn Wal e s.
Rob e rt E. Coo pe r, Jr., Attor

ne y Ge ne ra l and Re po rt e r; Mic ha e l E . M oo re , So lic ito r G e ne ra l; Clarenc e E. L

utz, Assi stant Attorney

Gene ral; Mike Bottoms, District Attorney Gene ral; and Patric k S. Butler, Assistant District Attorney Gene ral, for

the Appellee , the State of Te nnessee

.

OP IN ION

I. F acts
A Gil es C o u n ty

G r an d Ju r y in d ic te d th e Pe ti ti o n e r

o nth e f t o f p r o p e rty v a lu e d a t o ver $60,000. At the hea

ring on the Petitioner’s g uilty pl ea to that char g e, the State infor med the trial court that, ha d the ca se g one to trial, the e vidence would have show n: [B ]etwe e n th e mon ths of May [] 20 02 , an d Nov e mbe r 2 00 5, [the De fe nd ant], wh ile in t he sc op e of

he r e mpl oy

me nt, did take fr om he r e mpl oy e r a su m of mon e y in
e xce ss o f $ 60 ,0 00 .0 0, wh ic h I be lie ve is the statut or y a mou nt to g e t it int o a

Cla ss B felony rang e.2

Additionally , in response to questioning from the t rial court, the Defenda nt stated t hat she g raduated from hig h school and a ccumulate d approximately twenty -six colleg e cr edits. She worke d at Hillside Hospital as a r emittance spe cialist for six y ear s and made $10.25 per hour . The De fenda nt expl ained that her job require d her to post insura nce pa y ments and patient pa

y ments. Be fore working at the hospital, she worke d at J o h n son Controls and at fast food r estaura nts. After he aringthe evidenc e and verify

ing the Def

endant’ s plea was voluntarily and knowing ly

enter ed, the tria l court ac cepte d the De fe nd ant’ s g uil ty

ple a , im po se d th e a g re e d te n y e ar p ri so n sen te nc e and se t a he ari ngdate to deter mine the amount of re stitut ion.

At the restitut ion hear ing, the following evidenc e wa s prese nted: Wil liam Scott Duvall, the direc tor of ethics and compliance for Hillside H ospital, testified that in 2005 he bec ame a war e of a theft at Hillside Hospital. Duvall said the Def endant was “re ceiving cash from patients

. . . paying b il ls ” an d a ls o f r o m t h e c a f e te r ia ’ s c a s h f

lo w

. T h e D e f

e n d an t’ s in it ia ls an d

lo g in na me w e r e n e xt to t he e ntr ie s o n th e pa

y me nt s y ste m. Duv all s a id t he re we re dis c re pa

nc ie s in the a mou nt o f c a sh
rec eived ve rsus the amount deposited. He said, “[T]he discrepanc ies wer e cle are d by zero i n g out patie nt a c c ounts or

pu tti ng re fu

nd s in patie nt a c c ounts that we re old .” He a lso sa id, “ [A]ll of tho se entries had [t he Def

endant’ s] initials, [ which we re a part of] her log in information[,] next t o them.” Duvall estimated the hospital’s losses at: $87,952 in 2002; $94,796 in 2003; $98,324 in 2004; and $102,796 in 2005. He admitt ed t h e hospital rec eived $16,000 to $19,000 fr om its i nsuranc e company as re imbursement af

ter it met its $500,000 deductible.

On cr oss-examination, Duval l t est ified that he did not know the hospital’s insura nce deductible f

rom 2000-2005 and that he did not know the insuranc e compa ny ’s involvement with the hospital. He also said the Defenda nt had two supervisors, both of whom denied involvement in the theft. Duva ll said the Defenda nt would post a pay

ment to one account and then issue ca sh to another patient’s ac count. He said she di d this with about 1200 patients, but he did not verify this procedur e with eac h patient whose a ccount she used.

On redire ct-e x amination, Duvall testified that the hospital did not re g ularly pay cash r efunds to p a tie nts . H e a lso state d th a t th e Def e nd ant l a c ke d a

uth or ity to m a ke c a shre fu

nd s to patie nts

. Additionally , Duvall noted that the De fenda nt paid money

into patient acc ount s t h at h ad been inactive f or at lea st six months.

S p ec ial Ag ent B rad Elliott with the Tennesse e B urea u of Investig ation testified that he interviewe d the Def

endant, a nd s h e co n fesse d to embezzl ing f unds after being rea d her Miranda rig hts. The Def

endant told him that she made “ [c] ontrac tual and ins uranc e adjustm ents to acc ounts.” I n h is w or ds , “ She state d s he pu lle d the mon e y of f, po ste d in sura

nc e , c on tr a c tua l, o r a dju stm e nt t o zero the bala

nce.” “She didn’t ac tually make the de posits. S he filled the de posits out, put all of the
mon e y tog e the r a

nd so me on e e lse wo uld

a c tua lly c arr y the de po sit ba g int o the ba nk .” Ag e nt E lli ott said he subpoena ed the De fenda nt’s bank re cords, whic h showed lar g e amounts o f m oney being deposited. When Ag ent Elliott t ried locating the D efe n d an t ’s assets, he found a home valued at $65,000 to $75,000; vehicles; a motorcycle; and a boat. He sa id she still owed money on the house.3

The De fenda

nt told age nt Elliot t that she bought “eve ry day ” thi ng s with the m oney she st ole. Ag ent Elliott also said the De fenda nt ear ned $35,000 to $36,000 a y ear from her job.

On cr oss-examination, Age nt Elliot t testified t hat, in addition to her y ear ly salary , the De fe nd ant d e po sit e d in to h e r p e rs on a l ba nk a c c ount a bo ut $ 16 2, 00 0 o ve r t

he fi ve -y e ar s pa

n. He sa id she stole enoug h money

eac h y ear to cre ate a

“sala ry ” of $60,000.

J im Edmondson, an administrator at Hillside Hospital, testified t hat the De fenda nt’s job was to “ take c a shand

pa y me nts that we re ma de and pr e pa re a de po sit sli p a nd to p os t th e se pa

y me nts to patient[s’] acc ounts.” On cross-e x amination, Edmondson said he would not rehir e the De fenda nt at $25,000 a y ear , and he would not rec ommend her to other employ ers at $25,000 a y ear . He then qualified that stateme nt, saying he was not sure whether he would “f

eel t h e same” in eig ht to ten y ear s. When later ca lled back to the sta nd , E d m o n d s on admitted it was “re asonable ” that the De fe nd ant w a s a

uth or ize d to make c a shre fu nd s f or patie nts wi th p ri vate ro oms

. The De fe ndant testified that she w as thirty -seve n y ear s old, and had be g un servingthe ten y ear sentenc e for

theft. She obtained her “GED ” and two y ear s of colleg e cr edits. The De fenda nt
rec ited that, befor e her job a t the hospital, she worke d six y ear s at the Johns on Controls factory , and befor e that as an intern manag er at a fast food restaur ant. Working for the hospital, the Defe ndant
e arned $1 0. 25 an h our, wh ic h amou nte d to aro un d $ 20 ,0 00 to $ 25 ,0 00 a y e ar. She ha s tw o s on s, ag es seve nteen a

nd nineteen, a

nd has no phy sical or medic al limit ations. The Def endant ag ree d that she should be able to g et a minimum wag e job afte r beingrele ased f rom prison. She then listed her expected monthly

expenses, which included: $400 for r ent, $250 to $300 for utilities, $300 for food, $200 for transportation, $50 for clothing, and $50 for medical expenses. The Defendant said she also owes Home Depot $1000 and a g ree d that there is a “substantial possibilit y ” that she will have to p ay ta xes o n th e mon e y sh e sto le

. She a lso sa id s he wo uld be sh ari ngthe re nt a

nd uti lit ie s w ith he r h us ba nd , ma kin g the tot a l f

or he r m on thl y

e xpe ns e s aro un d $ 10 00

. Th e De fe nd ant s a id t hat w ith a minimum wag e job, she ex pects to ear n betwee n $900 and $1000 a month. The Def endant testified that she thoug ht she would be a ble to pay $25 or $30 a w eek f

or re stitut ion.

On cr oss-examination, the Def endant stated that her husband was unemploy ed, but he had
e arn e d $ 7 a

n h our at hi s p re vio us job . Sh e a lso sa id sh e has not ha d a ny dis c ipl ina

ry pr ob le ms i n pr iso n. I f s he we re g ra

nte d pa ro le a ft e r s e rv ingthi rt

y pe rc e nt o f h e r s e nte nc e a t pr iso n, sh e wo uld still h ave approxim ately

seven y ear s and four

months to pay

restitution. The Def

endant sa id her colleg e cla sses wer e in business and a ccount i n g. She admitted she could re turn to work at the fa ct o ry , wh er e s h e e arn ed $ 1 0

. 2 5 a nh o u r. T h e D ef en d an ts ai d

s h e p re v i o u s l y

o wn eda D o d ge Dura ng o, but she and he r husband sold it. Her husba nd has a small fishing boat and at some point also owned a

rec reational vehicle.

On re direc t-examination, the Defe ndant testified that her boss g ave he r per mission t o make cash r efunds to patients. She a lso said that when she ear ned $10.25 an hour

at the fa ctory , she wa s not a convicte d felon; she be lieved she w ould only be able to ear

n $6 an hour be cause of her status
as a c onvicted fe lon.4

When answer ing the co u rt ’s questi ons, the Def endant a dmitted that she alone e mbezz led from the hospital. The D efe ndant af firmed that s h e h ad p re v iously g iven a state ment to law enfor ceme nt in which she said she took full responsibility for the c rime, and in whic h she stated: “I am willing to pay

back the money .” The Def endant testified that her stateme nt is true.

Ad dit ion a lly , the fo llo wi ng e xch ang e oc c ur re d be tw e e n the tr ia l court and the De fe nd a nt:

The Court : Now, at some p o i n t y ou filled out an indig ency form and you wer e a pp oin te d a

lawy e r t hat th e ta xpay e rs are pa

y ingfo r y ou ; r ig ht?

The Wit ne ss : Y e s, ma ’a

m.
The Court : And on this form, Idon’t see wher e y ou show y ou g ot any cash. What happene d to all of that ca sh?

The Wit ne ss : Ba s i ca l l y j u s t s p en t i t o n ev ery d ay an y t h i n g wh et h er

i twa s s h o p p i n g, cloth es , m y ch i l d ren. O f cour se, they wer e both at the home at the time. J ust the bills. J ust everyday . Of c ourse, at the time, y ou know, if I wanted to g o out and buy
a ne w o utf it, Iwe nt o ut a

nd bo ug ht i t. I t wa sn ’t jus t lik e , y ou kn ow . So a

lot of it jus t w e nt t o e ve ryda

y ite ms a nd pa y ingthe bil ls.

The Court : I n addition to this , though, I am hea ring that y ou would have a cquire d things that y ou wanted r ather than nee ded.

The Wit ne ss : Yes, ma’a

m. That is true.

The Court : B e c a

us e y ou ha d a ll o f t

hat mo ne y

y ou sto le to d o it

wi th; ri g ht?

The Wit ne ss : I

bo ug ht t hin g [s] that if

I– y ou kn ow , th a t I

wa nte d, y e s.
After hear ing the rele vant testimony and conside rin g

th e evidenc e in the re cord, the trial court order ed re stitut ion to Hillside Hospital in the amount of $162,603. I t is from this judgment that the Def endant now a

ppeals.

II. Ana lys is On appe al, the De fenda

nt claims the trial court ordere d her to pa y excessive re stitut ion. Whe n th e de fendan t c ha lle ng e s th e re sti tut ion a mou nt o rd e re d b y

the tr ia l c ourt , th is C ourt wi ll utiliz e a de no vo sta

nd ard of re vie w w itha

pr e su mpt ion

that th e tr ia l c ourt ’s ru lin g wa s c or re c t. T.C.A. § 40-35-401( d) (2006) ; State v. J ohnson , 968 S.W .2d 883, 884 (Tenn. Crim. App. 1997)

. The purpose of orde ring restitution is t o compensate the victim and to punish and re habilitate the defe ndant. Johnson , 968 S.W .2d at 885. “In deter mining the amount and metho d o f p aym en t or other restituti on, the court shall consider the financ ial resour ces a nd future a

bility of the de fenda

nt5

to p ay or pe rf or m.” T. C.A . § 40 -3 5-3 04 (d ) ( 20 06 ); State v. Bottoms , 87 S.W .3d 95, 108 (Tenn. Crim. App. 2001). After

all, “[a]n order of r estitution which obviously cannot be fulfilled serve s no purpose f or the a ppellant or the vic tim.” Johnson , 9 6 8 S

. W

. 2 d at 8 86. There is “no formula f or deter mining restitution,” but the amount must be “re asonable ” and “ must be based upon the vic tim’s pecunia ry loss and the financ ial condition and obligations of the def endant; and the amount order ed to be paid does not have to equa l or mirror t h e v i ctim’s prec ise pec uniary loss.” Johnson , 968 S.W. 2d a t 88 6; Sta te v . S

mi th , 8 98 S.W. 2d

74 2, 74 7 ( Te nn . Cr im. App

. 19 94 ). P e c un iary los s is define d as “( 1) All specia l damag es, but not gen er al d am ages, as substantiated by evidenc e in the
rec ord or a s ag ree d to by the defendant; and (2) Reasonable out-of -pocke t expenses incurre d by the victim resulting from the filing of char g es or cooper ating in the investigation and prosec ution of the offe nse.” T.C.A. § 40- 35-304(e ).

When a tr ia l c ourt

or de rs a de fe nd ant t o s e rv e a

se nte nc e of

inc arc e ratio n, a s o pp os e d to probation, it lacks the jurisdiction to order a restituti on pay ment plan, and, thus, it m ay only order a total amount of re stitut ion. S t a t e v

. J a m es L e w i

s F r i tz , No. 02C0 1

- 9 5 0 3

- CC

- 0 0 0 9 4 , 1 9 9 5 WL 686112 (Tenn. Crim. App., at J ackson, Nov. 15, 1995) (holding t hat a trial court lacks jurisdiction to impose restitution pay

ment plans on a de fenda

nt it order ed to be inca

rce rate d beca

use the pa y ment methods would be conditions to the defe ndant ’s p ar o l e, over which the B oard of Probation and Paroles has e x clusive authority ), no Tenn. R. App. P. 11 application filed

. A de fe nd ant o rd e re d to pay restitution

“ s h a ll b e r e s p o n s ib le f

o r th e p ay me n t o f th e r e s ti tuti o nu n ti l t

h e e xp ir a ti o no f

the sentenc e im posed by the court, and any pay ment or per formanc e sche dule established by the cour t sh a ll no t e xten d b e y on d th e e xpir a tio n d a te .” T. C.A .§ 40 -3 5- 30 4( g )( 2) ; Bottoms , 87 S.W .3d at 108. “Any unpaid portion of the restitution or dere d may be conver ted into a civil judgment.” T.C.A. § 40-35-304( h)(1)

. Th e tr ia l c ourt

e xpla ine d h owit a

rr ive d at th e re sti tut ion

a mou nt o f $ 16 2, 60 3 a s f

oll ow s:
The co n f li c ti n g te s ti mo n y

o f th e tw o w it

n e s s e s o nb e h a lf

o f L if e p o in t a nd Hi lls ide re la tiv e to c a shre fu nd s ma ke s it imp os sib le fo r the Court to d ist inguis h c a sh
re fu nd s to patie nts wi th p ri vate ro oms fr om the 12 00 patie nts re c e ivi ngc a shre fu nd s. Whil e the Court believe s that resti t ution ex cee ds $162,603, it is unable to set the
re sti tut ion

any hi gher w iththe e vid e nc e pr e se nte d b y the State . T o d o s o w ou ld amount to pure spec ulation. Defe ndant admits that she is a ble to pa y restitution of $162,603, and the Court f i n d s t h at s he is able to pa y this sum over the period of parole

. Th e pr oc e ss f

or de te rm ini ng a re sti tut ion a mou nt i s a tw o- ste p p ro c e ss: the tr ia l c ourt mus t first deter mine the pec uniary loss to the vi ctim, and then it must deter mine how much of that amount the def endant c an re asonably

be expected to pa

y

. See J ohnson , 968 S.W. 2d

a t 88 6; Sta te v . W

e nd e ll Gary Gibson , No. M2001-01430-CCA-R3-CD, 2002 WL1358711, at *3 ( T enn. Crim. App., at Nashville, Jun. 24, 2002), no Tenn. R. App. P. 11 applicatio n f i led . We conclude the trial court pr op e rl y fo un d th a t th e vic timsu ff e re d a pr ov e n p e c un iary

los s o f $ 16 2, 60 3. Th e De fe nd a nt, althoug h not specifica lly

admitting “that she is able to pay restitution of $162,603,” as state d by the trial court, did testify

that she is “willing to pa

y back the money .” We re cog nize that there c ould be6

a diffe ren ce b et we en the Def endant’ s willingness to pay and the De fenda

nt’s ability

to pay . The De fe nd ant’ s f

ina nc ia l c on dit ion

wa s e xten siv e ly e xplor e d at the re sti tut ion he ari ng . T he c re dib ili ty of the De fenda

nt’s testimony

conce rning what she can rea sonably be expected to pa

y , including he r explanation as to what happe ned to t he larg e quantity of ca sh that she stole, is properly a matter for the trial court to de termine. In our view, the trial court c are fully considere d the evidenc e pre sented at the re stitut ion hear ing a nd then deter

mined the pec uniary

loss to the victim and the Defe ndant’s financ ial condition to arr ive at the restitut ion amount of $162, 603. We have c are fully revie wed the judgme nt of the trial cour t and have found no er

ror.
III. Conclusi on
Af te r a tho ro ug h r e vie w o f the re c or d and a pp lic a ble law, we c on c lud e the tr ia l c ourt pr op e rl y order ed the De fenda

nt to pay $162,603 in restitution. W e af firm the trial c ourt’s judg ment.

________________________________ ROBERT W. WEDEMEYER, J UDGE