Court Opinion

ID: 2996709
Source: CourtListenerOpinion
Date Created: 2015-09-24 19:30:53.625127+00
Date Added: 2024-06-11T08:11:40.102024
License: Public Domain

In the
 United States Court of Appeals
               For the Seventh Circuit
                          ____________

No. 03-1219
UNITED STATES     OF   AMERICA,
                                               Plaintiff-Appellee,
                                v.

WALE KING,
                                                       Defendant.

Appeal of SHAMSIDEEN SHOBANDE

                          ____________
        Appeal from the United States District Court for the
          Northern District of Illinois, Eastern Division.
            No. 89 CR 462—James B. Zagel, Judge.
                          ____________
 ARGUED OCTOBER 31, 2003—DECIDED NOVEMBER 17, 2003
                    ____________

 Before POSNER, EASTERBROOK, and EVANS, Circuit
Judges.
  EASTERBROOK, Circuit Judge. More than 14 years ago a
grand jury indicted Wale King on 10 counts of fraud.
18 U.S.C. §§ 1029(b), 1341. Sometime in August 1990, with
trial just around the corner, King went underground. A
warrant was issued for his arrest, and he was nabbed in
May 1999, in New York City. Back in Chicago, King applied
for release on bail. Surprisingly, in light of King’s history,
Judge Norgle granted this request provided that King could
2                                                No. 03-1219

find a surety for a $50,000 bond. The judge released King
that very day, without waiting for a surety to underwrite
the bond, and also allowed him to leave the jurisdiction.
(King told the judge that he wanted to attend a conference
in Louisiana.) Ten days later, while King was in Louisiana,
two sureties—Shamsideen Shobande and Sulley
Alawiye—co-signed King’s appearance bond. In June 2000
King pleaded guilty to one count of the indictment, and
sentencing was set for November. But he did not appear
and is again a fugitive. Between the guilty plea and the
date set for sentencing, Judge Zagel granted King’s request
to have his passport back so that he could visit a daughter
in Nigeria. Bank and airline records reflect that King
returned to the United States, but he did not return to
court. His disappearance led the United States to demand
the forfeiture of the bond, and the court entered a judgment
against King, Alawiye, and Shobande.
  Shobande has appealed; Alawiye and King have not.
Shobande contends that, by changing the terms of King’s
bail without the sureties’ consent, the court released any
liability on his part. We must assume that the United
States has been unable to collect from Alawiye, despite the
fact that sureties must not be accepted unless they can
assure payment, 18 U.S.C. §3142(c)(1)(B)(xii); Fed. R.
Crim. P. 46(e). Otherwise Shobande’s appeal is hard to
understand. Actually a lot of things about this situation are
hard to understand—the grant of bail in 1999 to someone
who had been a fugitive for nine years (does the judicial
system learn nothing from an accused’s conduct?); the
return of King’s passport after his plea of guilty, at a time
when he would have a strong reason to indulge his revealed
preference for flight; and the failure of litigants and bench
alike to protect the interest of the sureties. When King
sought the return of his passport, a step that increased his
ability to return to life as a fugitive, he did not notify the
No. 03-1219                                                    3

sureties, who would have been entitled to object. Nor did
the prosecutor or the judge alert them. So complete has
been the disregard of the sureties’ interest that notice of the
motion to enter judgment against them was sent only to
King’s lawyer, leading to a default judgment (though this
would have been proper in any event under Fed. R. Crim.
P. 46(f)(3)(A), which permits judgment against a surety as
part of any bail forfeiture). When the sureties found out and
complained, seeking either exoneration or a reduction in
their exposure, see Rule 46(f)(2)(B), the order denying this
motion again went only to King’s lawyer. After he learned
of the final disposition, Shobande had to seek still further
relief from the district court to obtain extra time to file an
appeal.
  When a defendant proposes any material change in the
conditions of a bond that has been underwritten by sureties,
they are entitled to notice and an opportunity to be
heard—and to revoke their commitments if the judge alters
the terms of release over their opposition. See Reese v.
United States, 76 U.S. (9 Wall.) 13, 21 (1869), which holds
that modifications to a bond made without the consent or
knowledge of the surety may render the obligation unen-
forceable. If the defendant fails to notify the sureties, the
prosecutor should do so; and if both sides fail to protect the
sureties’ entitlement, then the judge should ensure that
notice is given. Cf. Fed. R. Crim. P. 46(f)(3)(C) (district clerk
must mail notice to sureties at address of record). Although
the surety appoints the clerk as agent for service of process,
see Rule 46(f)(3)(B), it remains essential for the clerk (as
agent) to send the notice forward; here, however, no one
sought to serve the clerk as the sureties’ agent. Liability on
a bond is a matter of contract, independent of the criminal
prosecution—this is why sureties have 60 days to appeal,
the same period as in civil litigation to which the United
States is a party, see United States v. Santiago, 826 F.2d
499, 502-03 (7th Cir. 1987)—and persons potentially liable
4                                                No. 03-1219

on a contract are entitled to notice and an opportunity to be
heard during judicial proceedings that may affect their
interests. Few decisions say this explicitly—maybe the
point is viewed as so clear after Reese that repetition is
unnecessary—but it is at all events a straightforward
consequence of suretyship’s contractual underpinnings.
When they do not get notice, and the underlying agreement
is materially altered to the sureties’ detriment, then the
sureties’ obligation is discharged. See Arthur Adelbert
Sterns, The Law of Suretyship §6.2 (5th ed. 1972) (James L.
Elder, ed.).
  It is too late to give the sureties notice and an opportunity
to object, so they invoke the principle that a material
change in the terms of release—which is to say a change
that significantly augments the risk that the defendant will
not appear when required—relieves them of their obliga-
tions. See United States v. Gambino, 17 F.3d 572 (2d Cir.
1994). That a material change in risk can discharge the
surety’s obligation is a staple of suretyship law; the princi-
ple is not limited to criminal cases. See Restatement (Third)
of Suretyship & Guaranty §§ 37, 41(b)(i) (1996); Law of
Suretyship, supra. Nor can it be limited to changes over the
prosecutor’s objection. The prosecutor contends that,
because the United States opposed the return of King’s
passport, while the prosecutor in Gambino agreed to the
change in conditions of release, the sureties must continue
to stand behind King’s appearance. We do not think that it
can matter who favored the change; sureties’ obligation
rests on contract, so the right question to ask is what risk
they agreed to accept. Having failed to notify the sureties of
judicial proceedings that potentially affected their interests,
the United States is not well situated to contend that
judicial errors in changing the terms of King’s release come
at the expense of the sureties rather than the Treasury, or
that the sureties would have approved had they been told
No. 03-1219                                                 5

what was afoot. (Shobande denies that he would have
agreed. The lack of timely notice forces us to take Shobande
at his word.)
  Still, to say that a material increase in risk can exonerate
the surety is not to say that it always does so. It is neces-
sary to ask whether the incremental risk came to pass.
Suppose that the district court had released King on
condition that he remain at home, with electronic moni-
toring of his movements. See 18 U.S.C. §3142(c)(1)(B)(iv). If
the judge later permitted King to travel to New Orleans for
a conference, that would have increased the sureties’ risk;
and if he had failed to return to Illinois, the realization of
that risk would have made it inappropriate to collect from
the sureties. Now suppose, however, that King did return
and was again required to remain home with electronic
monitoring. If he sawed off the ankle bracelet and bolted for
parts unknown, the sureties would remain liable—for that
form of flight would have been exactly the risk they took.
The authorized trip would not have played a role. One can
say much the same about the actual events. The judge
authorized King to travel to Nigeria, and had he stayed
there the sureties would have had a good defense to pay-
ment. He did not remain abroad, however; King returned to
New York (where the original bond allowed him to reside)
and only then vanished. The risk of that disappearance is
exactly the one these sureties voluntarily took.
  At oral argument Shobande’s counsel suggested that King
may have had the passport duplicated by forgers and used
the copy to assist his flight. Of that, however, there is no
evidence. Indeed, there is essentially no evidence, period.
The sureties did not introduce or proffer any, nor did they
seek discovery. We do not know whether King surrendered
the passport after returning from Nigeria in December
2000. For all we can tell, King is hiding somewhere in New
York. When conditions of bond are violated, forfeiture is
presumed. See Fed. R. Crim. P. 46(f)(1). Sureties must
6                                              No. 03-1219

shoulder the burden of demonstrating entitlement to
exoneration or reduction. Fed. R. Crim. P. 46(f)(2)(B), (g).
The paucity of evidence therefore redounds to the sureties’
detriment. Shobande has not demonstrated that King’s
disappearance may be attributed to the incremental risk
associated with the change in conditions, as opposed to the
original risk associated with posting bond for a defendant
with an established propensity for flight.
                                                 AFFIRMED

A true Copy:
      Teste:

                        ________________________________
                        Clerk of the United States Court of
                          Appeals for the Seventh Circuit

                  USCA-02-C-0072—11-17-03