Stratacos v. StateStratacos v. State
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- Nahmias
We granted certiorari to decide whether the Court of Appeals erred in Stratacos v. State, 312 Ga. App. 783, 786-787 (720 SE2d 256) (2011), by holding that a felony conviction for theft by deception based on a defendant’s failure to fully perform services as promised, see
The Court of Appeals also overlooked a second reason that proof of the value of the services the defendant actually performed was necessary in this case: The State sought felony punishment for violations of
In this case, appellant Steven George Stratacos has challenged on appeal four of his convictions for felony theft by deception based on his deceitful promises to perform various construction services. Strata-cos claims that, on those four counts, the evidence presented at trial showed he provided some services but did not establish the value of those services, and thus the evidence did not support the jury’s guilty verdicts. We conclude that the evidence was sufficient to sustain felony convictions under
1. The evidence at trial, viewed in the light most favorable to the verdicts, showed the following. Between November 2005 and July 2006, Stratacos fleeced nine property owners in Clarke County. Using the name “Steve George,” Stratacos drafted and signed ten contracts with nine property owners promising to perform various home and business construction projects. Despite being paid all or part of the contract price up front, Stratacos failed to complete any of the ten jobs — and in four cases he did not even start the work.2
On May 5, 2007, Stratacos was indicted on ten counts of theft by deception; the allegations tracked the language of
2. (a) In Georgia, the crime of theft by deceitful promise to perform services traces back to the labor contract act of 1903 (“1903 Act”). See Ga. L. 1903, p. 90. The first section of the 1903 Act defined the elements of, and established misdemeanor punishment for, the crime:
Any person who shall contract with another to perform for him services of any kind, with intent to procure money or other thing of value thereby, and not to perform the service contracted for, to the loss and damage of the hirer, or, after having so contracted, shall procure from the hirer money, or other thing of value, with intent not to perform such service, to the loss and damage of the hirer, shall be deemed a common cheat and swindler, and upon conviction shall be punished as for a misdemeanor.
Id. § 1 (emphasis added). Not surprisingly, one of this Court’s earliest decisions interpreting the statute held that proof of actual loss to the victim was an essential element of the crime. “Loss by or damage to the person contracted with, and from whom money or other thing of value is procured, is a necessary element in the offense.” Millinder v. State, 124 Ga. 452, 453 (52 SE 760) (1905). Subsequent decisions of the Court of Appeals did the same. See, e.g., Banton v. State, 57 Ga. App. 173, 175-176 (194 SE 827) (1938); Coleman v. State, 6 Ga. App. 398, 402-403 (65 SE 46) (1909).
Insisting that the State prove actual loss to the victim was crucial to distinguishing criminal conduct from run-of-the-mill breaches of contracts for services. See Abrams v. State, 126 Ga. 591, 593-594 (55 SE 497) (1906). See also Brown v. State, 8 Ga. App. 211, 211 (68 SE 865) (1910) (“The purpose of the ‘labor contract act’ of 1903 . . . is not to enforce the contract to perform services, but to punish the fraudulent procurement of money, or other thing of value, under the contract . . . .”). And this Court soon held that, “[w]here it appears that advances were made and that the person to whom the advances were made performed a certain amount of service, but the value of such service is not made to appear, the prosecution fails to carry [its] burden of proof.” Abrams, 126 Ga. at 591. Otherwise, “[i]t maybe that the value of the service rendered was more than the equivalent of the provisions advanced under the contract,” and the alleged victim would not have suffered any injury at all. Id. at 594.
This principle was recognized and applied by the Court of Appeals as well. Thus, in Coleman the court reversed the defendant’s conviction under the 1903 Act where the evidence showed that the victim had paid the defendant $18.55, but the defendant “had worked for twenty-six days, and the value of the work thus performed by him was not shown to have been less than $18.55.” 6 Ga. App. at 402. Similarly, in Banton the court reversed a conviction under the 1903 Act where “the evidence [did] not clearly show that the [victim] suffered any loss or injury,” because the defendant had worked for a day and a half after being advanced only 80 cents “and an inference that the State should have overcome in rebutting the presumption of innocence, was
The 1903 Act had a serious flaw, however. The second section of the statute created an evidentiary presumption of criminal intent if the defendant did not fully perform the contract at issue or refund any advanced payment with interest:
Satisfactory proof of the contract, the procuring thereon of money or other thing of value, the failure to perform the services so contracted for, or failure to return the money so advanced with interest thereon at the time said labor was to be performed, without good and sufficient cause, and loss or damage to the hirer, shall be deemed presumptive evidence of the intent referred to in the preceding section.
Ga. L. 1903, p. 90, § 2.
In 1942, the Supreme Court of the United States struck down Georgia’s labor contract act as unconstitutional. See Taylor v. Georgia, 315 U. S. 25, 31 (62 SCt 415, 86 LE 615) (1942). Because criminal intent was presumed once the prosecution established the basic facts of an agreement to provide services, an advance payment, the worker’s failure to return the money with interest, and the worker’s failure to fully perform without good cause, the Court reasoned, the “necessary consequence” was that anyone “who has received an advance on a contract for services which he is unable to repay is bound by the threat of penal sanction to remain at his employment until the debt has been discharged.” Id. at 29. “Such coerced labor is peonage,” which “is a form of involuntary servitude within the meaning of the Thirteenth Amendment,” and “it is no less so because a presumed initial fraud rather than a subsequent breach of the employment contract is the asserted target of the statute.” Id. Thus, the Court concluded, the 1903 Act was “repugnant to the Thirteenth Amendment and to the [Anti-Peonage] Act of 1867.” Id. at 31.6
(b) The crime of theft by deceitful promise to perform services was resurrected in its current form — without the peonage-inducing presumption — when the General Assembly adopted Georgia’s then-modern criminal code in 1968. See Ga. L. 1968, p. 1249, at pp. 1290-1291 (now codified as amended as
To sustain a conviction under
But where the victim has received something of value from the defendant in exchange for his property, as in the case of an alleged violation under
Accordingly, in prosecutions under
While this Court has not previously addressed this issue in the post-1968 era, the Court of Appeals did in Holt v. State, 184 Ga. App. 664 (362 SE2d 464) (1987). The Holt court quoted Abrams’s admonition that, “ ‘[wjhere it appears that advances were made and that the person to whom the advances were made performed a certain amount of service, but the value of such service is not made to appear, the prosecution fails to carry [its] burden of proof.’ ”
(c) In addressing Stratacos’s argument that the State had not proven “the value of the work done as opposed to the value of the advances given to him,” the Court of Appeals relied on two cases applying
[t]o make a prima facie case of theft by deception based on a promise of service, the state must prove, among other things, a definite contract; a failure to perform the contracted-for services without good and sufficient cause; and a failure to return the money advanced under the contract without good and sufficient cause.
312 Ga. App. at 786 (quoting Campbell, 286 Ga. App. at 73). Kimble says the same thing. See 209 Ga. App. at 37. Unfortunately, the cited portion of both cases does not mention a crucial element required to convict a defendant charged under
Moreover, both Campbell and Kimble took their litany of elements from Holt. See Campbell, 286 Ga.App. at 73 &n. 4 (citing Holt, 184 Ga. App. at 665-666); Kimble, 209 Ga. App. at 37 (quoting Holt, 184 Ga. App. at 665-666). But both cases unfortunately omit the very next passage in Holt, which quotes Abrams for one of the “other things” that must be proved to convict under
3. The Court of Appeals also erred in failing to recognize that, in a prosecution for
If the State is content to have an
As discussed in Division 2, in theft-by-deception prosecutions under
4. We now apply these holdings to Stratacos’s case. The error he raised at trial and on appeal is the trial court’s failure to direct a verdict of not guilty on four of the felony counts of the indictment —• Counts 1,4, 5, and 8 — because the State failed to prove the difference in value between the services Stratacos provided and the amount of money he was paid.16 We review the denial of a directed verdict under the same standard used in evaluating the sufficiency of the evidence to support a criminal conviction: “whether the evidence, viewed in the light most favorable to the verdict, would enable a rational trier of fact to conclude beyond a reasonable doubt that [the defendant] was guilty of the crimes for which he was convicted.” Spiller v. State, 282 Ga. 351, 355 (647 SE2d 64) (2007). We conclude that the State presented sufficient evidence to sustain felony convictions under
(a) As to Count 1, the State presented testimony from the victim that she paid Stratacos a total of $4,137.50 on a $4,437.50 contract to replace 11 windows in her daughter’s house.17 However, Stratacos replaced only seven windows and did not provide materials for, or perform any work on, the remaining four windows. This testimony supports a pro rata calculation of the value of the work that Stratacos performed. Cf. Banton, 57 Ga. App. at 175-176 (using the contract’s provision that the defendant was to be paid “sixty cents a day” to determine that his work for a day and a half was worth more than the 80-cent advance he received). Since the 11 window replacements were similar, each window replacement was, in essence, a unit of performance under the contract. And since there was a clear division between the seven windows that Stratacos replaced and the four he did not replace, as to which he did no work and supplied no materials, the jury could rationally conclude that Stratacos performed 7/llths — about 64 percent — of the services he had promised, and thus that he earned about 64 percent, or $2,840, of the $4,437.50 total contract price. Stratacos was paid $4,137.50, so using some basic math, the jury could rationally conclude that Stratacos’s underperformance on the contract ultimately deprived, and intended to deprive, the victim of about $1,297.50 ($4,137.50 paid minus $2,840 earned) — well over the $500 felony threshold at the time he violated
(b) As to Count 4, the State presented testimony that: (1) the victim and Stratacos contracted for him to resurface a flat, 720-square-foot portion of her roof for $2,100 and to install three large skylights in her kitchen for $1,900; (2) the victim paid Stratacos a $2,000 advance, which he was to use, at a minimum, to purchase the flat roofing product and the skylights; (3) Stratacos did not provide any of the roofing product or the skylights, delivering only four two-by-fours and stopping work after cutting the three skylight holes in the kitchen roof; and (4) the victim had to spend an additional $900 to purchase the three skylights and an unspecified amount to purchase the roofing product, as well as pay another contractor an unstated sum to install the skylights and to do the roof work. Because the evidence, when viewed in the light most favorable to the verdict, showed that the $2,000 advance payment was meant to cover the cost of the major materials for the project and the victim had to spend $900 merely to buy the
(c) Similarly, in support of Count 5, the State presented testimony that: (1) the victim paid Stratacos $3,000 up front on a $4,000 contract to build a storage shed; (2) Stratacos stopped working after installing the floor and framing three of the walls; and (3) the victim had to spend about $3,000 more to purchase materials that Stratacos was supposed to provide. Given that the $4,000 contract was meant to cover labor and materials, the evidence that the victim had to spend $3,000 on materials alone to complete the work Stratacos left undone allowed the jury to rationally conclude that his underperformance deprived the victim of more than $500.
(d) As to Count 8, however, the State failed to produce evidence demonstrating any shortfall to the alleged victim, Collins, Moody and Company. The Company’s representative, Scott Collins, testified that: (1) the Company paid Stratacos a total of $6,867 on a $10,200 contract to insulate and reseal its office building’s roof; and (2) Stratacos delivered most if not all of the materials for the project, but he and some helpers performed just one day of work. Collins did not say how many days of work the project was expected to take, specify what amount of the contract or the advance payments was for materials and what amount was for labor, or assign a dollar value to either the labor or the materials that Stratacos actually provided. Collins did say that the Company paid another contractor $7,800 to complete the roof, and the State introduced a copy of the invoice from the new contractor. However, neither Collins nor the invoice specified what the additional $7,800 paid for in terms of labor, materials, or both.
Unlike the testimony of the victims of Counts 4 and 5, the evidence regarding Count 8 was insufficient for the jury to find, directly or by deduction, the value of the services Stratacos actually provided in exchange for what he was paid. The evidence showed that Stratacos performed some portion of the contract labor and delivered most or all of the materials covered by the contract, and the State did not present any evidence that allowed the jury to determine whether the services the Company received were worth less than the $6,687 it paid Stratacos. Thus, there was no direct evidence that the materials Stratacos delivered were worthless than $6,867. Nor did the evidence that the new contractor charged the Company $7,800 allow the jury to infer the value of the labor and materials that Stratacos had provided.
The evidence did not establish that what the new contractor did under its contract was limited to completing the promised services that Stratacos had left undone under his contract. The new contractor was paid more than twice the $3,333 left to Stratacos under his contract with the Company. But the new contractor may have charged much more for the labor on the project than Stratacos did, or performed work beyond that promised by Stratacos, or purchased more expensive materials instead of using those that Stratacos left behind, or repaired damage done by Stratacos’s failure to seal the roof properly before abandoning the job. Cf. Graham v. State, 251 Ga. App. 395, 397 (554 SE2d 528) (2001) (holding that, under
As our analysis of the other counts at issue indicates, the State did not need to present much more evidence than it did on Count 8 to prove a violation of
Judgment affirmed in part and reversed in part.
Hunstein, C. J., Thompson, P. J., Benham, Hines and Melton, JJ., and Judge Reuben M. Green concur. Blackwell, J., disqualified.
Notes
When what is now
More details about the four jobs at issue on appeal are discussed in Division 4 below.
These included Stratacos’s 1999 convictions in Fulton County on two counts of felony theft by taking, his 2003 conviction in Hall County for conversion of payments for real estate improvements, and his January 2005 conviction in Gwinnett County for felony theft by conversion for taking $1,237.50 for a construction job that he never performed.
Specifically, the court sentenced Stratacos to serve a ten-year confinement term on Count 1, ten-year confinement terms concurrent with Count 1 on Counts 3 and 4, and a 12-month confinement term on Count 2 (the one misdemeanor charge) also concurrent with Count 1. The court then sentenced Stratacos to serve a ten-year confinement term on Count 5 consecutive to Count 1, and ten-year confinement terms on Counts 6 and 7 consecutive to Count 1 but concurrent with Count 5. On Count 8, the court sentenced Stratacos to serve ten years on probation consecutive to Count 7; Count 9 added ten years of probation consecutive to Count 8. Finally, on Count 10, Stratacos was sentenced to another five years of consecutive confinement followed by another five years of probation.
Stratacos also disputed the trial court’s failure to instruct the jury on his “claim of right” affirmative defense, but the Court of Appeals held that the trial court did not err by declining to give that instruction sua sponte. See Stratacos, 312 Ga. App. at 784-786. We declined to grant certiorari on that issue.
Georgia’s labor contract act was just one of many Jim Crow statutory schemes that used criminal sanctions, or the threat of criminal sanctions, to coerce African-Americans into providing labor. See generally Douglas A. Blackmon, Slavery By Another Name: The Re-Enslavement of Black Americans From the Civil War to World War FI (2009).
The other four forms of theft by deception, which are not at issue in this case, occur when the defendant intentionally:
(1) Creates or confirms another’s impression of an existing fact or past event which is false and which the accused knows or believes to be false;
(2) Fails to correct a false impression of an existing fact or past event which he has previously created or confirmed;
(3) Prevents another from acquiring information pertinent to the disposition of the property involved; [or]
(4) Sells or otherwise transfers or encumbers property intentionally failing to disclose a substantial and valid known lien, adverse claim, or other legal impediment to the enjoyment of the property, whether such impediment is or is not a matter of official record ....
We will not attempt to catalog in this opinion the various types and combinations of evidence that the State may use to prove the value of the services the defendant actually provided, although in Division 4 below we provide some examples of what evidence is sufficient and insufficient when we apply this holding to the four counts that Stratacos has challenged.
Our holding applies only to theft-by-deception charges under
It is worth noting, however, that Holt relied on this portion of Abrams without any acknowledgment that Abrams was a case interpreting the 1903 labor contract act, the language of which was considerably different than that of
Nor, for that matter, do Campbell andKimble mention the “to the loss and damage of the hirer” element that was enunciated three times in the 1903 Act and noted in Holt. See Ga. L. 1903, p. 90, § 1; Holt, 184 Ga. App. at 665.
This issue did not arise in cases interpreting the 1903 Act, because all violations of that statute were misdemeanors. See Ga. L. 1903, p. 90, § 1.
For trials brought under the current version of
In cases brought under
Of course, this showing would not necessarily be dispositive on the amount-of-the-theft issue. If, for instance, evidence shows that the defendant intended to perform more services than he actually provided the victim, but before he could complete the intended performance he was thrown off the job by the victim or arrested by the police, the jury could consider whether that evidence reduces the theft amount below the felony threshold or shows that there was no violation of
The State’s proof of other elements of the crimes is not disputed.
At times, the victim described the contract as being for 12 windows, but her testimony makes clear that the written contract, and its total price of $4,437.50, was for 11 windows.