State of Iowa v. Terran E. Roache, 920 N.W.2d 93

Terran Roache pleaded guilty to crimes stemming from multiple vehicle break-ins; the district court ordered restitution totaling $3557.08, including $1900 for a stolen Northland CDL “Pre-Trip Inspection Study Guide.”
Victim Jordan Hagedon’s backpack (containing the soft-cover guide) was stolen from his parked car; the guide and backpack were not recovered and Hagedon’s insurer assigned no value to the guide but paid other losses (less a $500 deductible). Hagedon completed the course and has an outstanding $1900 balance with Northland.
Northland’s paperwork: an initial “check-out agreement” said students must return the guide and might be fined if not returned (no dollar amount); a later document (signed by Hagedon two days after the theft) fixed the fine at $1900 (described as 4× course tuition) and labeled it a “fine.”
District court awarded the $1900 as restitution to the victim; the court of appeals affirmed. The Iowa Supreme Court granted further review to assess legal standard and evidentiary support for the award.
The Supreme Court held that the Restatement (Third) of Torts scope-of-liability (risk) analysis applies to criminal restitution and reversed the $1900 award, finding it punitive and unsupported by substantial evidence; the remainder of restitution was affirmed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Applicability of scope-of-liability standard in restitution	State: restitution tied to civil-liability principles; broad recovery where causal link exists	Roache: scope limits liability; should not apply broader civil standard	Court: Adopted Restatement (Third) §29/§33 scope-of-liability risk standard for criminal restitution determinations
Factual causation for $1900 fine	State: Roache’s theft caused Hagedon’s exposure to the fine; but-for test satisfied	Roache: value was negligible and the $1900 arose from post-theft agreement, not his conduct	Court: Factual causation satisfied—the theft caused loss of the guide and exposure to liability
Whether $1900 is recoverable as indemnity/liquidated damages	State: Hagedon could recover contractual liability to Northland; the contracts and Hagedon’s signature support $1900	Roache: $1900 is an unenforceable penalty, speculative, and Hagedon hasn’t been compelled to pay it	Court: State failed to prove Hagedon was compelled to pay; $1900 resembles an unenforceable punitive fine, so cannot be awarded as pecuniary damages
Application of avoidable-consequences/comparative-fault doctrine	State: not relied on	Roache: Hagedon failed to mitigate by accepting the excessive fine	Court: Avoidable-consequences/comparative-fault inapplicable to intentional criminal acts; victim’s fault not a defense here

State v. Hagen, 840 N.W.2d 140 (Iowa 2013) (restitution must be proven and tied to civil recoverable damages)
State v. Bonstetter, 637 N.W.2d 161 (Iowa 2001) (state bears burden to prove restitution amount; billing alone insufficient)
State v. Jenkins, 788 N.W.2d 640 (Iowa 2010) (survey of restitution principles and interplay with civil law)
Thompson v. Kaczinski, 774 N.W.2d 829 (Iowa 2009) (adopted Restatement (Third) scope-of-liability risk standard in civil proximate-cause analysis)
Spreitzer v. Hawkeye State Bank, 779 N.W.2d 726 (Iowa 2010) (scope-of-liability applied to fraud damages)
State v. Tribble, 790 N.W.2d 121 (Iowa 2010) (use of factual but-for causation from Restatement (Third))
Pexa v. Auto Owners Ins., 686 N.W.2d 150 (Iowa 2004) (billed amounts relevant only if paid or supported by evidence of reasonableness)
Iowa, Chi. & E. R.R. v. Pay Load, Inc., 348 F. Supp. 2d 1045 (N.D. Iowa 2004) (party may recover stipulated contractual loss schedules if it will in fact be compelled to pay them)