People v. Hubbard
63 Cal. 4th 378
Cal.2016Background
- Jeffrey Hubbard was superintendent of the Beverly Hills Unified School District (2003–2006); his contract charged him with overseeing "budget and business affairs" and preparing Board agendas.
- Hubbard authored two signed district memoranda directing payroll/human-resources to pay Karen Christiansen a $500/month auto allowance and a $20,000 stipend; those payments were made but there was no Board-recorded approval.
- Superintendent lacked unilateral authority to approve compensation changes; the Board had to ratify pay changes in open session, and personnel reports normally supported such items.
- District staff treated Hubbard's memoranda as directives and implemented them; Hubbard testified the Board had discussed the payments in closed session but provided no documentation of Board approval.
- Prosecutor charged Hubbard with misappropriation of public funds under Penal Code § 424(a)(1); jury convicted on two counts; Court of Appeal reversed, holding § 424 applies only to officers with formal authority to disburse funds.
- The Supreme Court granted review and considered (1) whether § 424 applies to all public officers or only those "charged with the receipt, safekeeping, transfer, or disbursement of public moneys," and (2) whether substantial evidence showed Hubbard met that standard.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope of § 424(a)(1): whether it applies to all public officers or only those charged with receipt/safekeeping/transfer/disbursement of public moneys | § 424 covers all public officers (separate "officer" clause) in addition to any person charged with public moneys | § 424 applies only to officers who are specifically charged with receipt/safekeeping/transfer/disbursement of public moneys | § 424 applies only to public officers who are charged with receipt, safekeeping, transfer, or disbursement of public moneys (text, history, and precedent favor this reading) |
| Sufficiency of evidence that Hubbard was "charged with" public moneys | Hubbard exercised material control over district funds via contract duties, supervisory authority, agenda-setting, and his written directives to payroll/HR | Hubbard lacked unilateral authority to approve payments (Board had exclusive power), so he was only a first step in the spending process and not "charged with" public moneys | Substantial evidence supported that Hubbard was "charged with" public moneys: his contractual duties, statutory responsibilities, fiduciary role, supervisory control, and the successful use of memoranda to obtain payments showed material control |
| Degree of control required under § 424 | Plaintiff: some degree of material control suffices; need not be exclusive authority | Defense: requires formal/approval authority to be "charged with" funds | Court: actual function and material control (not exclusive unilateral authority) governs; leadership/title alone insufficient, but material bureaucratic authority qualifies |
| Scope of criminal liability under § 424 (mens rea and limitations) | § 424 penalizes appropriation without authority; applies where defendant knows or is criminally negligent about lack of authority | Defendant emphasized not to criminalize routine administrative acts or mistakes | Court: liability requires acting without lawful authority and knowledge or criminal negligence about that lack; statute does not punish good-faith errors or ordinary negligence |
Key Cases Cited
- People v. Dillon, 199 Cal. 1 (1926) (section 424 addresses duties of officers charged with custody or control of public moneys)
- Stanson v. Mott, 17 Cal.3d 206 (1976) (public officials who retain custody or authorize expenditure of public funds bear grave responsibility and may be liable for lack of due care)
- Stark v. Superior Court, 52 Cal.4th 368 (2011) (§ 424 applies to those with some control over public funds; criminal negligence standard explained)
- People v. Aldana, 206 Cal.App.4th 1247 (2012) (mere peripheral acts—e.g., signing timesheets—may be insufficient to show one is charged with public moneys)
- People v. Groat, 19 Cal.App.4th 1228 (1993) (actual authority to certify/payroll can establish control over disbursement for § 424 purposes)