Court Opinion

ID: 4045428
Source: CourtListenerOpinion
Date Created: 2016-09-28 23:50:33.767783+00
Date Added: 2024-06-11T14:30:17.880503
License: Public Domain

ACCEPTED
                                                                           01-14-00424-CV
                                                                 FIRST COURT OF APPEALS
                                                                         HOUSTON, TEXAS
                                                                      1/29/2015 2:22:08 PM
                                                                       CHRISTOPHER PRINE
                                                                                    CLERK

                   No. 01-14-00424-CV
                                                           FILED IN
                            In the                  1st COURT OF APPEALS
                     Court of Appeals                   HOUSTON, TEXAS
                           For the                  1/29/2015 2:22:08 PM
                                                    CHRISTOPHER A. PRINE
                   First District of Texas                  Clerk
                         At Houston
                  

                         No. 1417446
                  In the 351st District Court
                   Of Harris County, Texas
                  

        IN THE MATTER OF APPROXIMATELY $80,600
                  

                STATE’S APPELLATE BRIEF
                  

                                          DEVON ANDERSON
                                          District Attorney
                                          Harris County, Texas

                                          DAN MCCRORY
                                          Assistant District Attorney
                                          Harris County, Texas
                                          mccrory_daniel@dao.hctx.net

                                          1201 Franklin, Suite 600
                                          Houston, Texas 77002
                                          Tel.: 713/755-5826
                                          FAX No.: 713/755-5809

                                          Counsel for Appellee

ORAL ARGUMENT REQUESTED ONLY IF REQUESTED BY APPELLANT
              STATEMENT REGARDING ORAL ARGUMENT

      Pursuant to TEX. R. APP. P. 39.7, the State requests oral argument only if oral

argument is requested by appellant.

                                          i
                                           TABLE OF CONTENTS

STATEMENT REGARDING ORAL ARGUMENT .......................................................... i

INDEX OF AUTHORITIES .............................................................................................. iii

STATEMENT OF THE CASE ........................................................................................... 1

SUMMARY OF THE ARGUMENTS ................................................................................ 2

REPLY TO POINT OF ERROR ONE ................................................................................ 2

REPLY TO POINT OF ERROR TWO ............................................................................... 7

CONCLUSION ................................................................................................................. 14

CERTIFICATE OF SERVICE .......................................................................................... 15

CERTIFICATE OF COMPLIANCE ................................................................................ 15

                                                              ii
                                          INDEX OF AUTHORITIES

CASES

A. Benjamini, Inc. v. Dickson,
   2 S.W.3d 611 (Tex. App.--Houston [14th Dist.] 1999, no pet.) ................................ 8, 11

Bank of Saipan v. CNG Financial Corp.,
  380 F.3d 836 (5th Cir. 2004) .......................................................................................... 12

Four B’s Inc. v. State,
  902 S.W.2d 683 (Tex. App.--Austin 1995, writ denied) ............................................. 4, 6

Kennedy v. State,
  No. 01-12-01142-CV, 2014 WL 5771935 (Tex. App.--Houston
  [1st Dist.] Nov. 6, 2014, no pet. h.) ................................................................................. 6

Nelms v. State,
  761 S.W.2d 578 (Tex. App.--Fort Worth 1988, no writ) ............................................ 7, 8

Sinclair Houston Fed. Credit Union v. Hendricks,
  268 S.W.2d 290 (Tex. Civ. App. – Galveston 1954, writ ref’d n.r.e.) .......................... 11

Wells Fargo Bank, N.A. v. Ballestas,
 355 S.W.3d 187 (Tex. App.--Houston [1st Dist.] 2011, no pet.) .................................... 9

York v. State,
  373 S.W.3d 32 (Tex. 2012) ............................................................................................. 4

STATUTES

TEX. CODE CRIM. PROC. ANN. art. 47.01 (West 2006) ....................................................... 4

TEX. CODE CRIM. PROC. ANN. art. 47.01a (West 2006) .................................................. 5, 7

TEX. CODE CRIM. PROC. ANN. art. 47.02 (West Supp. 2014) ......................................... 5, 7

RULES

TEX. R. APP. P. 39.7.............................................................................................................. i

                                                                iii
TO THE HONORABLE COURT OF APPEALS:

                                STATEMENT OF THE CASE

          This is an appeal from the trial court’s ruling on the State’s petition for the

disposition of stolen property brought under Chapter 47 of the Texas Code of

Criminal Procedure. (CR Supp. 3).1 The State’s petition alleges that Dennis Pharris

committed the offense of theft by unlawfully and fraudulently acquiring $215,000

from Dr. Vic Patel. (CR Supp. 8). Abraham Fisch, a criminal defense attorney,

represented Pharris in this criminal matter. (CR Supp. 7-8).

          A fraud examiner traced Patel’s stolen money and determined that Pharris

transferred $80,600 of the stolen funds into Fisch’s IOLTA account. (CR Supp. 8).

Immediately following a bond hearing on Pharris’s criminal case, at which

evidence was presented regarding Pharris’s theft of Patel’s money, Fisch “almost

completely purged” his IOLTA account. (CR Supp. 8-9). Fisch transferred the

funds from his IOLTA account, including Patel’s $80,600, to a newly-created

account that he opened under his “attorney name.” (CR Supp. 9). Pursuant to a

warrant, the State seized $80,600 from Fisch’s new account. (CR Supp. 9).

          The trial court granted the State’s petition for disposition of the stolen

property. (CR Supp. 72). The trial court ruled the $80,600 was stolen property and

1
    “CR” refers to the clerk’s record filed with this Court on June 9, 2014.
    “CR Supp.” refers to the supplemental clerk’s record filed with this Court on October 17, 2014.
ordered it to be returned to Patel, “the rightful owner of the property.” (CR Supp.

72). On appeal, Fisch argues that he has a superior right to possession of the

$80,600.

                        SUMMARY OF THE ARGUMENTS

Point one:   Article 47.02 provides a district court with jurisdiction over a Chapter

47 claim during and after the related criminal trial. Therefore, the trial court had

jurisdiction to rule on the State’s Chapter 47 petition after the judgment in Pharris’s

criminal case was entered.

Point two: The trial court did not err in denying Fisch’s 2014 petition for the

return of the seized $80,600 because the trial court denied him relief on this same

issue in response to a petition Fisch filed in 2009. As such, Fisch’s 2014 request

for the funds was barred by the doctrine of collateral estoppel.

      Alternatively, Fisch’s right to the money was not superior to Patel’s right of

possession because Fisch had some knowledge that the money was stolen when he

transferred the money from the IOLTA account, which was not his money, to his

personal account.

                       REPLY TO POINT OF ERROR ONE

      In his first point of error, Fisch contends the trial court’s order granting the

State’s petition for disposition of stolen property is void. (CR Supp. 72).

                                          2
Specifically, Fisch maintains the order is void because the trial court lacked

jurisdiction when it issued the order.

Relevant facts

          Pharris was charged by indictment for the Patel theft in the 351st District

Court on or about April 2, 2009. (CR Supp. 54-56). The trial court conducted a

bond hearing on April 7th and 9th of 2009. (CR Supp. 8). Dr. Patel testified at this

hearing, describing Pharris’s theft of $215,000 from him. (CR Supp. 8). At the

conclusion of the hearing, the trial court found “proof evident” that Pharris had

committed the Patel theft and denied Pharris a bond. (CR Supp. 8; RR II 41).2

          After learning that Fisch had transferred $80,600 of the theft proceeds from

his IOLTA account to his personal account right after the bond hearing, the State

seized $80,600 from Fisch’s account on April 21, 2009, pursuant to a warrant. (CR

Supp. 8-9). The State filed its petition for disposition of stolen property in the 351st

District Court on May 26, 2009. (CR Supp. 3).

          Pharris eventually pleaded guilty to the Patel theft and was sentenced to five

years in prison. (CR Supp. 54-55). The judgment was entered on December 4,

2013. (CR Supp. 54). The trial court granted the State’s petition for disposition of

stolen property on May 21, 2014, and ordered the $80,600 returned to Dr. Patel.

(CR Supp. 72).

2
    “RR II” refers to the reporter’s record for the hearing conducted on March 4, 2010.

                                                  3
Applicable law

      The issue in this case, the disposition of stolen property, is controlled by

Chapter 47 of the Texas Code of Criminal Procedure. Chapter 47 provides a

procedure by which a person claiming an interest in stolen property, which is in the

possession of a governmental authority, may seek to obtain possession of the

property. York v. State, 373 S.W.3d 32, 43 (Tex. 2012).

      Section 47.01 provides that “an officer who comes into custody of property

alleged to have been stolen shall hold it subject to the order of the proper court

only if the ownership of the property is contested or disputed.” TEX. CODE CRIM.

PROC. ANN. art. 47.01(a) (West 2006). Once stolen property is seized, a trial court

may determine how such property may be disposed. Specifically, there are two

statutes in Chapter 47 addressing the issue of which court is “the proper court” to

rule on the restoration of stolen property, one for proceedings that occur before the

related criminal trial and another for proceedings during or after the criminal trial.

Four B’s Inc. v. State, 902 S.W.2d 683, 684 (Tex. App.--Austin 1995, writ denied)

(citing TEX. CODE CRIM. PROC. ANN. arts. 47.01a, 47.02 (West 2006 & Supp.

2014).

      Section 47.01a is titled “Restoration when no trial is pending” and it

provides:

             If a criminal action relating to allegedly stolen property is
             not pending, a district judge, county court judge,

                                          4
            statutory county court judge, or justice of the peace
            having jurisdiction as a magistrate in the county in which
            the property is held or a municipal judge having
            jurisdiction as a magistrate in the municipality in which
            the property is being held may hold a hearing to
            determine the right to possession of the property, upon
            the petition of an interested person, a county, a city, or the
            state. Jurisdiction under this section is based solely on
            jurisdiction as a criminal magistrate under this code and
            not jurisdiction as a civil court.

TEX. CODE CRIM. PROC. ANN. art. 47.01a(a) (West 2006).

      Section 47.02 is titled “Restored on trial” and it provides:

            (a) On the trial of any criminal action for theft or any
               other offense involving the illegal acquisition of
               property, the trial court trying the case shall order the
               property to be restored to the person appearing by the
               proof to be the owner of the property.

            (b) On written consent of the prosecuting attorney, any
               magistrate having jurisdiction in which a criminal
               action for theft or any other offense involving the
               illegal acquisition of property is pending may hold a
               hearing to determine the right of possession to the
               property. If it is proved to the satisfaction of the
               magistrate that any person is a true owner of the
               property alleged to have been stolen, and the property
               is under the control of a peace officer, the magistrate
               may, by written order, direct the property be restored
               to that person

TEX. CODE CRIM. PROC. ANN. art. 47.02 (West Supp. 2014).

Argument and authorities

      After defendant Pharris pleaded guilty to the Patel theft, the trial court

sentenced Pharris and entered the judgment on December 4, 2013. (CR Supp. 54).

                                          5
On appeal, Fisch maintains the trial court lost jurisdiction over the “disposition of

stolen property” issue on January 3, 2014, when the trial court’s 30 days of general

plenary jurisdiction expired after the criminal judgment was entered. As such,

Fisch concludes that the trial court had no jurisdiction to rule on the State’s article

47.02 petition on May 21, 2014. (CR Supp. 72).

      Fisch’s contention is meritless because a trial court’s authority to make a

Chapter 47 ruling is not dependent on the court’s jurisdiction arising from the

related criminal prosecution. Rather, the court’s authority to issue such rulings

derives from the Chapter 47 statutes themselves.

      This Court recently observed that articles 47.01a and 47.02 are the two

provisions addressing the issue of jurisdiction for purposes of trial court rulings on

the disposition of stolen property. Kennedy v. State, No. 01-12-01142-CV, 2014
WL 5771935, at *5 (Tex. App.--Houston [1st Dist.] Nov. 6, 2014, no pet. h.). This

Court explained that a trial court has jurisdiction on Chapter 47 matters pursuant to

article 47.01a when no indictment or information has been filed initiating a

criminal action. Id. On the other hand, “[a]rticle 47.02(a)’s express language

allows the trial court to restore stolen property to its owner during or after a

criminal trial.” Id. (italics added); see also Four B’s Inc., 902 S.W.2d at 684

(article 47.01a authorizes restoration proceedings that occur before the related

criminal trial and article 47.02 authorizes such proceedings “during or after the

                                          6
criminal trial”) (italics added); Nelms v. State, 761 S.W.2d 578, 578-79 (Tex. App.--

Fort Worth 1988, no writ) (after defendant was acquitted in criminal theft trial, trial

court conducted hearing pursuant to article 47.02 to determine ownership of stolen

funds).

      Therefore, Chapter 47 provides for jurisdiction in a district court both before

and after a criminal trial without a temporal restriction. TEX. CODE CRIM. PROC.

ANN. arts. 47.01a, 47.02 (West 2006 & Supp. 2014). Since the trial court had

jurisdiction to rule on the State’s petition for the disposition of stolen property

under article 47.02, the ruling was not void.3 Accordingly, Fisch’s first point of

error is meritless and should be overruled.

                       REPLY TO POINT OF ERROR TWO

      In his second point of error, Fisch contends the trial court erred in denying

his “amended petition for release of seized property.” (CR 10; RR I 14).4 The

record indicates that Fisch filed this petition on February 17, 2014, under cause

number 1417446. (CR 10-12). In his petition, Fisch sought the return of the

$80,600 seized from his bank account. (CR 10-12). Fisch maintained that he had

no knowledge that the funds, which he received from Pharris as attorney fees, had

been stolen by Pharris. (CR 10). Fisch characterized himself as an “innocent

                                          7
provider of legal services.” (CR 11). Following a hearing on this matter, the trial

court denied Fisch’s petition on March 4, 2010. (RR II 4-51; Cr Supp. 53).5

       On appeal, Fisch continues to argue that the seized funds should be returned

to him. He claims he has a superior right to possess the funds because he did not

know the money was stolen when he accepted payment from Pharris. Fisch argues

he is entitled to the money because he obtained it in good faith and in return for

valuable consideration (i.e., legal representation).

Standard of review

       The disposition of stolen property is a civil matter. Nelms, 761 S.W.2d at

579. A trial court’s finding regarding the disposition of property is subject to a

sufficiency review. A. Benjamini, Inc. v. Dickson, 2 S.W.3d 611, 612 (Tex. App.--

Houston [14th Dist.] 1999, no pet.). When no findings of fact or conclusions of

law are made, as here, the trial court’s judgment implies all necessary findings of

fact to support the judgment. Id. at 613; Nelms, 761 S.W.2d at 579. When the

implied findings of fact are supported by the evidence, an appellate court must

uphold the judgment on any theory of law applicable to the case. Benjamini, 2
S.W.3d at 613. When making this determination, the reviewing court considers

3
        Assuming, arguendo, that the trial court lacked jurisdiction under article 47.02 on the
basis of there being no criminal case pending, the court would nevertheless have jurisdiction to
dispose of stolen property pursuant to article 47.01a, which applies when no trial is pending.
4
        “RR I” refers to the reporter’s record of the hearing conducted on May 21, 2014.
5
        “RR II” refers to the reporter’s record of the hearing conducted on May 4, 2010.

                                               8
only the evidence most favorable to the implied factual findings and disregards all

opposing or contradictory evidence. Id.

Collateral estoppel

      The trial court did not err in denying Fisch’s 2014 petition requesting the

return of the $80,600 seized from his bank account because the same trial court had

already denied another petition, filed in 2009 under cause numbers 991356,

1210228, 1210229, and 1031225, and denied in 2010, in which Fisch requested the

return of these same funds. (CR 10; CR Supp. 10, 53). Under such circumstances,

the doctrine of collateral estopped precluded Fisch from raising the same issue in

2014 that already had been resolved in 2010.

      The doctrine of collateral estoppel, also known as issue preclusion, prevents

relitigation of particular issues already resolved in a prior action. Wells Fargo

Bank, N.A. v. Ballestas, 355 S.W.3d 187, 193 (Tex. App.--Houston [1st Dist.] 2011,

no pet.). A party seeking to assert the bar of collateral estoppel must establish that:

(1) the facts sought to be litigated in the second action were fully and fairly

litigated in the first action; (2) those facts were essential to the judgment in the first

action; and (3) the parties were cast as adversaries in the first action. Id.

      Regarding the first factor, the facts Fisch sought to litigate in his 2014

petition were fully and fairly litigated pursuant to the 2009 petition (which was

ruled on following a hearing in 2010). Namely, in his 2014 petition, Fisch argued

                                            9
for the return to him of the money seized from his account based on his claim that

he had no knowledge the funds were stolen when he received them. (CR 10-11). In

his 2009 petition and during the 2010 hearing, Fisch made the same request for the

return of the same funds for the same reason (i.e., his lack of knowledge that the

funds were stolen). (CR Supp. 10; RR II 5, 15, 20, 40-41, 47). The issue of Fisch’s

right to the funds was fully and fairly litigated at the first hearing. Fisch testified at

length about this issue in 2010 and both parties had the opportunity to examine him

without limitation. (RR II 4-51).

      Regarding the second factor, the same facts Fisch sought to litigate in the

2014 petition were essential to the judgment in the ruling on the 2009 petition.

Namely, the same facts that Fisch sought to litigate in 2014 relating to his claimed

superior right to the funds based on his claim of an innocent ownership of the

funds were essential to the 2010 ruling. The 2010 ruling turned on the resolution

of the same issue Fisch presented in his 2014 petition.

      Finally, regarding the third factor, the two petitions pitted the same

adversaries against one another. In both instances, Fisch was attempting to recover

from the Harris County District Attorney’s Office the money seized from the

former by the latter.

      Considering these factors, Fisch was collaterally estopped in 2014 from

seeking the same relief that he was denied in 2010. As such, the trial court did not

                                           10
err in denying Fisch’s 2014 petition. For this reason alone, Fisch’s second point of

error is meritless and should be overruled.

Patel had a superior right to the money

      Fisch contends his right to the $80,600 was superior to that of Patel because

Fisch purportedly received the money from Pharris in exchange for valuable

consideration with no knowledge that Pharris stole the money from Patel. Having

received the money as an innocent third party, Fisch maintains his right to the cash

exceeds that of Patel, the person from whom the money was stolen. In support of

this contention, Fisch cites case law providing: “One who receives money which

has been illegally obtained by a third party in due course of business, in good faith,

and for valuable considerations, can keep it without liability to him from whom it

was stolen.” Sinclair Houston Fed. Credit Union v. Hendricks, 268 S.W.2d 290,

295 (Tex. Civ. App. – Galveston 1954, writ ref’d n.r.e.).

      However, reviewing the record in the light most favorable to the trial court’s

implied findings reveals that Fisch did not gain possession of the money in good

faith. Benjamini, 2 S.W.3d at 613 (appellate court considers only the evidence

most favorable to the trial court’s implied fact findings). Fisch confirmed that

when Pharris gave him the $80,600 in question, he placed the money in his IOLTA

account. (RR II 28, 46). He further confirmed that when he placed the funds in his

                                          11
IOLTA account, the money was not his since his money cannot be in the IOLTA

account. (RR II 26-29).

       Fisch also confirmed he was present at a bond hearing when the trial court

found proof evident that Pharris stole the money from Patel. (RR II 40-41; CR

Supp. 8). Fisch admitted that, during this bond hearing, he learned that the money

in question could have been stolen by Pharris. (RR II 46). Fisch further admitted

that, several days after the bond hearing, he removed about $250,000 from his

IOLTA account and placed it in his personal account, leaving only $156 in his

IOLTA account. (RR II 34).

       These circumstances demonstrate that Fisch’s ownership of the funds began

when he transferred the funds from an IOLTA account to his personal account, an

event that occurred after he had knowledge that Pharris may have obtained the

funds by theft. As such, when Fisch gained ownership of the money, he was not an

innocent third party recipient. Rather, there was a lack of good faith in his receipt

of the money. Given this circumstance, Fisch did not have a superior right to

possess the funds.6 Bank of Saipan v. CNG Financial Corp., 380 F.3d 836, 843 (5th

Cir. 2004) (to recover stolen money, theft victim need not show third party

acquired money by fraud or duress, only that third party lacked good faith in

6
 There is also some evidence indicating that Pharris reimbursed Fisch with about $83,000 in
2010 after the trial judge denied Fisch’s original request for the return of the $80,600. (CR Supp.

                                                12
acceptance of the stolen funds). As such, the trial court did not err in denying

Fisch’s petition for the return of the stolen funds. Point of error two is meritless

and should be overruled.

67-68). Since Fisch was made whole with regard to the seized money, he did not have a superior
right to the seized money.

                                             13
                                  CONCLUSION

      It is respectfully submitted that all things are regular and the trial court’s

ruling should be affirmed.

                                                  DEVON ANDERSON
                                                  District Attorney
                                                  Harris County, Texas

                                                  /s/ Dan McCrory
                                                  DAN McCRORY
                                                  Assistant District Attorney
                                                  Harris County, Texas
                                                  1201 Franklin, Suite 600
                                                  Houston, Texas 77002
                                                  (713) 755-5826
                                                  TBC No. 13489950
                                                  mccrory_daniel@dao.hctx.net

                                          14
                           CERTIFICATE OF SERVICE

      This is to certify that a copy of the foregoing instrument has been mailed to

the following address:

      Regina Bacon Criswell
      Attorney at Law
      Carriage Place
      7803 Bent Briar
      San Antonio, Texas 78250

                                               /s/ Dan McCrory
                                               DAN McCRORY
                                               Assistant District Attorney
                                               Harris County, Texas
                                               1201 Franklin, Suite 600
                                               Houston, Texas 77002
                                               (713) 755-5826
                                               TBC No. 13489950

                         CERTIFICATE OF COMPLIANCE

       The undersigned attorney certifies that this computer-generated document
has a word count of 2,834 words, based upon the representation provided by the
word processing program that was used to create the document.

                                               /s/ Dan McCrory
                                               DAN McCRORY
                                               Assistant District Attorney
                                               Harris County, Texas
                                               1201 Franklin, Suite 600
                                               Houston, Texas 77002
                                               (713) 755-5826
                                               TBC No. 13489950

Date: 1/29/2015

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