Opinion ID: 612563
Heading Depth: 3
Heading Rank: 2

Heading: Treatment of MEPA

Text: Aside from the issue of how to value SWA's loss, there is also the matter of the $9,963 in the MEPA owned by the Fraziers and retained by SWA following the fire. As the district court found, the ownership in the lost property consisted of two pieces: the ownership stake ... of the Fraziers [of] $9,963 at the time of the fire in the MEPA and the remaining ownership [of the property] ... with SWA Corp. Sentencing Transcript at 82. In ordering restitution, the district court required Frazier to pay Erna $4,982.00 for her half of the MEPA retained by SWA following the fire. Frazier contends the restitution order is duplicative in that it requires him to pay on the full amount of SWA's loss without regard to the fact SWA retained the $9,963.00 MEPA while it also requires him to pay Erna for her half of the account. We, too, have some concern over the treatment of the MEPA in the restitution order. SWA claims it is entitled to keep the MEPA either as a result of Frazier's breach of the contract or because the Fraziers had $9,533.58 in delinquent payments under the contract. The record, again, is so sparse we cannot determine the purpose for which SWA retained the MEPA. [2] However, to the extent SWA was entitled to retain the money in the account under the contract as a form of compensation for damage to the property in the event of a breach, the amount retained should offset the amount SWA may claim because it reduces the amount of actual loss SWA suffered. This interpretation accords with the intent of Congress in enacting the MVRA  to compensate a victim in order to restore the victim to his original state, but not to overcompensate so as to provide a windfall. See Petruk, 484 F.3d at 1038. Therefore, on remand the district court will need to address the proper treatment of SWA's retaining the MEPA. In so concluding, we note the government raises several arguments as to why SWA is entitled to certain sums of money under the rent-to-own contract. But the criminal restitution process is not intended to compensate a victim for damages it may otherwise be entitled to in a civil proceeding. Chalupnik, 514 F.3d at 754. By retaining the $9,963 in equity the Fraziers owned in the MEPA, it is likely SWA was in part compensated for the loss of the property. Accordingly, the property loss incurred by SWA should be reduced by that compensation. If SWA is entitled to additional damages based on Frazier's breach of contract  e.g., delinquent rent payments  SWA may seek those funds in a civil suit.