People v. Bankers Insurance Co. , 247 Cal. App. 4th 1004 ( 2016 )

Filed 5/31/2016
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SIXTH APPELLATE DISTRICT
THE PEOPLE, H040226
(Santa Clara County
Plaintiff and Respondent, Super. Ct. No. C1121102)
v.
BANKERS INSURANCE CO.,
Defendant and Appellant.
Appellant Bankers Insurance Co. (Bankers) appeals from the superior court‟s
order denying its motion to vacate the forfeiture of its bail bond. The bond expressly
applied to “duly authorized amendments” to the complaint. Bankers contends that the
court was required to vacate the forfeiture because the prosecution‟s filing of an
unauthorized amended complaint materially increased its risk under the bond.
Respondent maintains that the court was not required to vacate the forfeiture because
there was no statutory basis for doing so and the amended complaint did not materially
increase Bankers‟s risk under the bond. We conclude that, although the amendment to
the complaint was not duly authorized, it did not materially increase the surety‟s risk and
therefore did not require the court to vacate the forfeiture and exonerate the bond.
I. Background
Martin Hernandez Moreno was arraigned on December 6, 2011 on a complaint
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charging him with felony counts of domestic violence (Pen. Code, § 273.5, subd. (a))
and false imprisonment (§§ 236, 237), which had occurred on December 2, 2011. At the
arraignment, the court issued a domestic violence protective order (DVPO), set bail at
$50,000, and remanded Moreno into custody.
On December 24, 2011, Bankers issued a bail bond of $50,000 to secure Moreno‟s
release in the domestic violence and false imprisonment case. The bond stated that
Moreno had been ordered to appear in court on January 18, 2012 on “pc 273.5(A),
pc236/237 charge/s” and that the surety “undertakes that the above-named defendant will
appear in the above named court on the date above set forth to answer any charge in any
accusatory pleading based upon the acts supporting the complaint filed against him/her
and all duly authorized amendments thereof, in whatever court it may be filed and
prosecuted, and will at all times hold him/herself amenable to the orders and process of
the court . . . .”
Moreno appeared at the January 2012 hearing and at a February 5, 2012 hearing.
On February 22, 2012, Moreno appeared in court for a “plea” hearing. The prosecutor
announced that she was filing an “amended complaint . . . based on the new conduct,
based on a violation of a restraining order on February 12, 2012.” The amended
complaint, filed that day, added misdemeanor counts of violating a protective order
(§ 273.6, subd. (a)) and aggravated trespass (§ 602.5, subd. (b)), both based on conduct
on February 12, 2012, to the two existing felony counts, which were both based on
conduct on December 2, 2011. The prosecutor asked the court to increase the bail
amount “based on the new law violations,” which had “occur[red] while he was out on
1
Subsequent statutory references are to the Penal Code.
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bail.” The court was initially inclined to increase the bail amount, but after an unreported
bench conference, the court decided “to leave the bail set at $50,000.” The court set the
preliminary examination for April 5, 2012.
Moreno did not appear at the April 5, 2012 hearing, and the court ordered the bail
forfeited. Bankers was notified of the forfeiture. The court subsequently granted
Bankers‟s request to extend the appearance period for an additional 180 days to
April 2013.
In April 2013, Bankers filed a motion to vacate the forfeiture and exonerate the
bond. Bankers argued that the court had materially increased its risk on the bond when it
permitted Moreno to remain free on the bond after the amended complaint was filed. In
June 2013, the court denied Bankers‟s motion. It found that the fact that the bond stated
that it applied to “duly authorized amendments” was determinative. The court thereafter
entered judgment on the bond, and Bankers timely filed a notice of appeal.
II. Analysis
“ „Ordinarily, appellate courts review an order denying a motion to vacate the
forfeiture of a bail bond under an abuse of discretion standard. [Citation.] When the
appellate court is deciding only legal issues, however, such as jurisdictional questions and
matters of statutory interpretation, the abuse of discretion standard does not apply.
[Citation.] When the facts are undisputed and only legal issues are involved, appellate
courts conduct an independent review.‟ [Citation.]” (People v. Lexington National
Insurance Corporation (2015) 242 Cal. App. 4th 1098, 1102.) The issues before us in this
case do not involve any factual disputes, so we exercise independent review.
Bankers contends that it was entitled to vacation of the forfeiture because the
amendment of the complaint materially increased its risk. It points out that the additional
counts in the amended complaint were not based on the same acts as the counts in the
original complaint since the crimes alleged in the new counts occurred two months after
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the complaint was filed and the bond was issued. Respondent contends that Bankers
could not obtain vacation of the forfeiture because it did not establish any of the
circumstances set forth in section 1305, which respondent claims are the exclusive bases
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for a vacation of a forfeiture. Respondent also contends that the amendment of the
complaint did not materially increase the risk because the bond expressly applied to “all
duly authorized amendments.” We begin by reviewing the cases that have dealt with
these issues.
In People v. Bankers Ins. Co. (2010) 181 Cal. App. 4th 1 (Bankers I), the Fifth
District Court of Appeal opined that the statutory grounds for vacating a forfeiture set
forth in section 1305 are exclusive and “[t]here is no common law defense” to a
forfeiture. (Bankers I, at p. 6.) However, the Fifth District also stated that it had “no
quarrel” with the proposition that “a surety is entitled to stand on its contract and
increasing the risk to a surety is the gravamen of a unilateral change on the government‟s
part,” but it found that the risk had not been materially increased on the facts of the case
before it. (Bankers I, at pp. 7-8.) The criminal defendant in Bankers I had been in
custody on sale and transportation of narcotics charges when the surety posted the
broadly worded bond, which applied to “all duly authorized amendments” to a pleading.
(Bankers I, at p. 3.) The subsequently filed complaint alleged that the criminal defendant
had sold and transported more than one ounce of methamphetamine. (Bankers I, at p. 3.)
The defendant thereafter failed to appear. On appeal, the surety claimed that the
allegations regarding the amount of methamphetamine materially increased the risk to the
surety entitling it to vacation of the forfeiture. The Fifth District found that the bond
covered the subsequently filed complaint, and the amount allegations did not materially
increase the risk to the surety. (Bankers I, at pp. 3, 5, 7-8.)
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Section 1305 provides that the court “shall vacate the forfeiture and exonerate the
bond” under various circumstances. (§ 1305, subds. (c)(1), (c)(2), (c)(3), (d), (f), (g).)
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In People v. International Fidelity Ins. Co. (2010) 185 Cal. App. 4th 1391
(Fidelity), the Fourth District Court of Appeal followed Bankers I in a case, like Bankers
I, where a pleading increased the potential penalty but was based on the same acts alleged
at the time the bond was issued. (Fidelity, at p. 1393.) The criminal defendant was
charged in a complaint with several counts and enhancements concerning a robbery and
assault on a single victim on a single date. (Fidelity, at pp. 1393-1394.) The surety
issued a bond guaranteeing the criminal defendant‟s appearance “ „to answer any charge
in any accusatory pleading based upon the acts supporting the complaint filed against
him/her and all duly authorized amendments thereof.‟ ” (Fidelity, at pp. 1395-1396.)
Amended pleadings were subsequently filed alleging additional offenses and
enhancements pertaining to two additional victims that had occurred on the same date as
the original charges. (Fidelity, at p. 1394.) The criminal defendant subsequently failed to
appear, and the court ordered the bond forfeited and denied the surety‟s motion to vacate
the forfeiture. (Fidelity, at pp. 1394-1395.) The Fourth District recognized the issue was
one of contract interpretation. (Fidelity, at p. 1396.) It found that the bond covered the
amended pleadings because the new counts were based on the same acts as those alleged
in the original complaint. (Fidelity, at p. 1396.)
In County of Los Angeles v. American Contractors Indemnity Co. (2011) 198
Cal. App. 4th 175 (American), Division Five of the Second District followed Bankers I.
The criminal defendant had been arrested and charged with domestic violence.
(American, at p. 177.) Before the complaint was filed, the surety issued a bond that
undertook to ensure the criminal defendant‟s appearance on the domestic violence charge
and to “ „answer any charge in any accusatory pleading based upon the acts supporting the
complaint filed against him . . . .‟ ” (American, at p. 179.) The complaint thereafter
charged him with domestic violence and two “unrelated” sex offender registration
violations, and it alleged two prior strike convictions. (American, at pp. 177, 179.)
When the criminal defendant subsequently failed to appear, the court ordered the bond
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forfeited, and it later denied the surety‟s motion to vacate the forfeiture. (American, at
pp. 177-178.) On appeal, the surety claimed that the filing of the complaint adding two
new unrelated charges and the strike allegations materially increased its risk. (American,
at p. 178.) The court concluded that by guaranteeing the criminal defendant‟s appearance
on any charge in any pleading based on the acts in the complaint before the complaint
was filed, the surety contractually agreed to accept the risk that the complaint would
include additional unrelated charges. (American, at p. 180.)
In People v. Indiana Lumbermens Mutual Ins. Co. (2012) 202 Cal. App. 4th 1541
(Indiana), Division Three of the Second District also followed Bankers I. The criminal
defendant had been charged by felony complaints in two separate cases. Although he had
fled and been missing for five years before being arrested on a warrant in the two cases,
he was inexplicably released on his own recognizance in the second case. (Indiana, at
pp. 1543-1544.) The second case alleged a robbery committed on the same date as one of
the many counts of robbery alleged in the first case. Both cases were pending when the
surety issued a bond in the first case after defendant was recaptured. The bond provided
that the surety guaranteed the criminal defendant‟s appearance “ „to answer any charge in
any accusatory pleading based upon the acts supporting the complaint filed against
him/her and all duly authorized amendments thereof, in whatever court it may be
prosecuted . . . .‟ ” (Indiana, at p. 1549.) The two cases were subsequently consolidated,
and the one count in the second case was added to the first case. The criminal defendant
thereafter failed to appear. (Indiana, at p. 1544.) The court ordered the bond forfeited
and denied the surety‟s motion to vacate the forfeiture. (Indiana, at pp. 1544-1545.)
On appeal, the surety claimed that the court had violated the conditions of the
bond by applying it to the second unrelated case. (Indiana, supra, 202 Cal.App.4th at
p. 1545.) Division Three found that the addition of the robbery count in the second case
to the first case was a “duly authorized amendment” that was covered by the bond‟s
express language. (Indiana, at pp. 1548-1550.) It also reasoned that, even if the
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additional count was unrelated, it did not materially increase the surety‟s risk and
therefore did not require vacation of the forfeiture. (Indiana, at pp. 1550-1551.) The
criminal defendant was facing 11 counts in the first case and had already shown himself
to be a high flight risk, so the addition of one more similar count did not materially
increase the risk. (Indiana, at p. 1551.)
In People v. Western Insurance Company (2013) 213 Cal. App. 4th 316 (Western),
Division Four of the Second District, without mentioning Bankers I, held that section
1305 was not the exclusive basis for vacation of a forfeiture. The surety had issued a
bond guaranteeing a criminal defendant‟s appearance to face counts alleged in a felony
complaint. (Western, at p. 319.) The criminal defendant subsequently sought the court‟s
permission to leave the United States so that he could go to the Philippines to attend his
mother‟s funeral. Without notifying the surety, the court granted this request. (Western,
at pp. 319-320.) The criminal defendant remained in the Philippines and failed to appear
for trial. (Western, at p. 320.) The court ordered the bond forfeited and denied the
surety‟s motion to vacate the forfeiture. (Western, at pp. 320-321.)
On appeal, Division Four held that the surety was entitled to have the forfeiture
vacated. “[A] surety is discharged from its liability under the bail bond agreement if the
government, without the surety‟s consent or knowledge, materially increases the surety‟s
risks.” (Western, supra, 213 Cal.App.4th at p. 322.) Because the government had
permitted the criminal defendant to leave the country without notifying the surety, the
government had materially increased the surety‟s risks. (Western, at pp. 323-324.)
Division Four held that section 1305 is not exclusive, and a surety may obtain
exoneration of a bond where the government materially increased the surety‟s risk
without the surety‟s consent or notice to the surety. “[I]t has long been the law that the
remedies provided in section 1305 for exoneration of a bond forfeiture under certain
conditions are not exclusive. (People v. McReynolds (1894) 102 Cal. 308, 312 [36 P.
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590].) Thus, a surety may be entitled to exoneration of a bond where circumstances
outside those set forth in section 1305 exist.” (Western, at p. 324, italics added.)
We do not disagree with the results in any of these cases. However, we do
disagree with the broad statement in Bankers I that section 1305 provides the exclusive
circumstances that may justify vacation of a forfeiture. Section 1305 identifies a number
of circumstances under which the court must vacate the forfeiture and exonerate the
bond. (§ 1305.) Section 1305 does not state that these circumstances are the exclusive
bases for vacating a forfeiture. The courts in Bankers I and all of the cases following it
considered the bonding language and whether the government‟s actions materially
increased the risk that the surety had accepted. And all of these courts concluded that the
risk had not been materially increased over that accepted by the surety in the bond. We
agree with Western that, if the government materially increases the risk to the surety
beyond the express terms of the bond without notice to the surety or the surety‟s consent,
the government violates its contract with the surety, and the surety is entitled to vacation
of the forfeiture and exoneration of the bond. Hence, we also agree with Western that
section 1305 does not preclude a court from vacating a forfeiture and exonerating a bond
under those circumstances.
We proceed to consider whether the amendment of the complaint materially
increased the risk to Bankers beyond that contemplated by the express language of the
bond. “A bail bond is a contract between the government and the surety. [Citation.] The
surety‟s liability is limited to the contract‟s terms. [Citation.]” (Bankers I, supra, 181
Cal.App.4th at p. 6.) “[I]t is the accepted rule that a surety cannot be held beyond the
express terms of his or her contract.” (People v. King Bail Bond Agency (1990) 224
Cal. App. 3d 1120, 1124.) Whether the amendment of the complaint materially increased
Bankers‟s risk beyond what it had accepted in the bond is an issue of contract
interpretation that we review de novo. (Fidelity, supra, 185 Cal.App.4th at p. 1396.)
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Bankers‟s bond accepted responsibility for ensuring that Moreno would appear to
face the domestic violence and false imprisonment counts alleged in the original
complaint and “to answer any charge in any accusatory pleading based upon the acts
supporting the complaint filed against him/her and all duly authorized amendments
thereof . . . .” (Italics added.) The new charges were not based “upon the acts supporting
the complaint,” as they were based on acts that occurred two months after the acts alleged
in the complaint. Nor was the amendment to the complaint a “duly authorized”
amendment. Section 1009 governs amendments to complaints. “A complaint cannot be
amended to charge an offense not attempted to be charged by the original complaint,
except that separate counts may be added which might properly have been joined in the
original complaint.” (§ 1009, italics added.) The new counts were not “attempted to be
charged by the original complaint,” nor could they “properly have been joined in the
original complaint,” since they had not yet occurred when that complaint was filed. It
follows that the February 2012 amendment of the complaint was not a “duly authorized”
amendment and did not fall within the express terms of Bankers‟s bond.
Nevertheless, the fact that the amended complaint did not fall within the express
terms of the bond does not necessarily mean that Bankers was entitled to have the court
vacate the forfeiture of its bond. That depends on whether the amendment of the
complaint to add two misdemeanor counts to the two existing felony counts materially
increased the risk to Bankers that Moreno would not appear to face the charges. We
cannot see how the addition of two misdemeanor counts to two felony counts materially
increased the risk to Bankers that Moreno would not appear. The misdemeanor counts
did not significantly increase the seriousness of the case. Consequently, we conclude that
the court did not err in denying Bankers‟s motion to vacate the forfeiture.
III. Disposition
The order denying Bankers‟s motion to vacate the forfeiture is affirmed.
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_______________________________
Mihara, J.
WE CONCUR:
_____________________________
Elia, Acting P. J.
_____________________________
Grover, J.
People v. Bankers Insurance Co.
H040226
10
Trial Court: Santa Clara County Superior Court
Trial Judge: Honorable Vanessa A. Zecher
Attorney for Defendant/Appellant: E. Alan Nunez
Attorneys for Plaintiff/Respondent: Orry P. Korb
County Counsel
Sara J. Ponzio
Deputy County Counsel
People v. Bankers Insurance Co.
H040226
11