State v. Matzdorff, 1 CA-CR 21-0050-PRPC

Background

Petitioner Sherry Lynn Matzdorff operated a home design/construction business that failed before completing contracted work for three clients.
The State charged her with multiple counts; she pled guilty to three theft counts and agreed to pay restitution to the three victims (including for dismissed counts).
Matzdorff admitted misapplying victims’ funds to employee/operating expenses and other projects, intending to repay later.
The superior court ordered $281,044.84 in restitution: $186,140.69 to A.L./S.L., $45,381.08 to R.Z., $19,523.07 to J.T./N.T., and $30,000 to the Arizona Registrar of Contractors (ROC).
Matzdorff sought post-conviction relief arguing the restitution improperly included “commission” and “overhead” payments and that the ROC was not entitled to restitution; the superior court summarily denied relief.
This court granted review but denied relief, finding the record supported including commission and overhead as losses and awarding restitution to the ROC was statutorily authorized.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Are "commission" payments recoverable restitution?	Matzdorff: commissions were earned and not part of victims' loss.	State: commissions were obtained under false pretenses and conferred no benefit to victims.	Court: affirmed inclusion — record shows no contractual entitlement, funds were misappropriated, and victims received no value.
Are "overhead" payments recoverable restitution?	Matzdorff: overhead reflected legitimate business/general‑contractor services and thus not loss.	State: overhead was funded by victims but used for unrelated expenses; no benefit to victims.	Court: affirmed inclusion — misapplication of funds and lack of project‑specific benefit support restitution; court excluded amounts creditable to specific project work.
Is ROC entitled to restitution for the $30,000 it paid R.Z.?	Matzdorff: ROC should not receive restitution ( argued lack of participation or entitlement ).	State: ROC reimbursed the victim from its Recovery Fund and is entitled under statute to be repaid.	Court: affirmed — statute authorizes restitution to an entity that reimbursed a victim; ROC need not have participated in the restitution proceeding.
Was the superior court’s summary denial of post‑conviction relief proper?	Matzdorff: court erred in awarding challenged items and in summarily denying relief.	State: record evidence supports the restitution findings; summary denial appropriate.	Court: grant of review but denial of relief; appellate review found no abuse of discretion and factual findings not clearly erroneous.

Key Cases Cited

State v. Amaral, 239 Ariz. 217 (2016) (standard of review for summary denial of post‑conviction relief: abuse of discretion)
State v. Pandeli, 242 Ariz. 175 (2017) (court abuses discretion if it makes an error of law or fails to investigate necessary facts)
State v. Madrid, 207 Ariz. 296 (App. 2004) (restitution requires loss directly caused by defendant’s criminal conduct)
State v. Wilkinson, 202 Ariz. 27 (2002) (losses caused by concurrence of other causal events are consequential and not recoverable)
State v. Ellis, 172 Ariz. 549 (App. 1992) (restitution’s purpose is to make the victim whole; courts have wide discretion)
Town of Gilbert Prosecutor’s Office v. Downie, 218 Ariz. 466 (2008) (restitution should not exceed actual loss and must be reduced by benefits conferred)
State v. Dixon, 216 Ariz. 18 (App. 2007) (restitution will be upheld if it reasonably relates to the loss sustained)
State v. Leal, 248 Ariz. 1 (2019) (court may award restitution to non‑victim entity that reimbursed a victim)