Ronnie Lee Natho Sr. v. State ( 2014 )

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-11-00498-CR
Ronnie Lee Natho Sr., Appellant
v.
The State of Texas, Appellee
FROM THE DISTRICT COURT OF LLANO COUNTY, 424TH JUDICIAL DISTRICT
NO. CR 6193, HONORABLE DANIEL H. MILLS, JUDGE PRESIDING
MEMORANDUM OPINION
A jury convicted appellant Ronnie Lee Natho Sr. of misapplication of an elderly
person’s fiduciary property and sentenced him to twenty-five years’ imprisonment. See Tex. Penal
Code § 32.45(b). Natho complains that the evidence is insufficient to support the verdict and that
the trial court erred in denying his request for a mistrial. We affirm the judgment of conviction.
Factual Summary1
In July 2005, Rosie Shelton signed a statutory durable power of attorney appointing
Natho,2 her former grandson-in-law, to act as her agent and attorney-in-fact and giving him the
general authority to act on Shelton’s behalf, including with regard to Medicaid issues. The document
1
The parties are familiar with the facts and we will therefore present as brief a recitation as
possible for purposes of this opinion.
2
Natho was married to Peggy Burthold, Shelton’s granddaughter, from 2002 through 2004.
included “[s]pecial instructions applicable to gifts” and stated that Shelton had to initial beside the
provision if she wanted Natho to have the power to make gifts from her estate. Shelton did not
initial the “gift paragraph,” and Shelton’s attorney James Herbort testified unequivocally that Natho
did not have the right to make gifts under the power of attorney. In late 2007 and early 2008, Shelton
was admitted to a hospital and then moved into a nursing home, no longer able to care for herself.
On April 24, 2008, Natho transferred to himself ownership of Shelton’s automobile.
In early August, Shelton became upset when she received a letter from her insurance company saying
that ownership of her $3,000 life insurance policy had been transferred to Natho. On August 14,
Natho signed a general warranty deed, deeding Shelton’s house to himself in exchange for $10;
Shelton retained a life estate and continuing control, including the right to sell or lease the property,
and Natho received a remainder interest, assuming Shelton did not dispose of the property or
otherwise act to take back that interest. On August 15, a friend of Shelton’s noticed Shelton’s
car was gone and that the locks to Shelton’s house had been changed. She immediately informed
Shelton, and she testified that she did not think that Shelton knew Natho had given himself Shelton’s
car or any interest in the house.
Peggy Burthold, Shelton’s granddaughter and Natho’s former wife, testified that she
did not know Shelton was in a nursing home until early September 2008, when Herbort called to say
Shelton wanted to talk to her. Burthold was initially turned away from the nursing home because
Natho had left instructions that she was not allowed to see Shelton, but she spoke to Herbort and was
eventually allowed in. On September 4, Shelton revoked Natho’s power of attorney and signed a
new one in favor of Burthold.
2
On September 5, Herbort sent Natho a letter instructing him that he was no longer
authorized to act for Shelton and asking him to return Shelton’s property, including keys, bank
information, and insurance policies. On September 22, Natho sold Shelton’s car to a third-party,
receiving between $4,750 and $5,600,3 and on about September 26, he cashed out the life insurance
policy, receiving $1,746. Burthold said that excluding Shelton’s house, Natho gave himself about
$5,000 to $10,000.
Kim Kernodle, an attorney who helps clients qualify for Medicaid, testified for the
defense and said that Natho came to see her about Shelton’s needs in July 2008. Kernodle told
Natho he could pay for the nursing home from Shelton’s assets until she had less than $2,000 left
and then apply for Medicaid, or he could choose a “spend-down” option, meaning “he could
basically spend the money, which would include some gifts and that those gifts would incur a
penalty,” making Shelton eligible for Medicaid after the expiration of a penalty period; Natho chose
the spend-down option.
Kernodle said it was “legal” for Natho to make gifts to himself as long as Shelton’s
needs were met and advised him to execute the warranty deed for the house to fulfill Shelton’s
wishes as expressed in her will that Natho be her sole beneficiary. She said that Shelton retained full
control over the property, and that the gift of the property did not become complete until Shelton’s
death. Kernodle said that she would not have changed her spend-down advice if Shelton had named
other beneficiaries in her will but that it would have affected “who we recommended gifts be made
3
Records from the Texas Department of Motor Vehicles show that Natho received $5,600
for the vehicle, but $4,750 was referenced elsewhere in the testimony.
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to. So if there had been another beneficiary in her will then we would not have allowed Mr. Natho
to only gift to himself. We would have had him make gifts according to the terms of the will.”
Kernodle acknowledged that Natho’s transfer of the car into his name occurred before he came to
her for advice and that Shelton’s house, car, and $1,500 of the cash value of her life insurance policy
would have been excluded from Medicaid’s calculations.
Kernodle said that, excluding the house, Natho gave himself a total of $27,560 in
“gifts” from Shelton’s estate—the car, the cash value of the insurance policy, and a check for
$24,276. However, her records valued the car at $1,535 and she did not know that Natho actually
received significantly more than $1,535. Kernodle did not believe Natho did anything to “the
detriment” of Shelton, but she also testified that by choosing the spend-down option, Natho
preserved assets that would have passed to him as beneficiary under her will.
One of Shelton’s nurses testified that Shelton suffered from Alzheimer’s, depression,
anxiety disorder, and delusions. She did not think Shelton was competent in January 2008, but
agreed that some of Shelton’s physical ailments can result in mental confusion. She also agreed that
in late March 2008, Shelton showed no impairment in her long-term memory, moderate impairment
in her short-term memory, a logical non-delusional thought process, appropriate use of speech,
and increased alertness. Psychologist Christopher Dalton regularly interacted with Shelton at the
nursing home and said she was able to answer his questions appropriately, volunteer relevant
information, discuss issues, and carry on conversations. Dalton remembered that Shelton was
distressed about her estate and legal affairs in the summer and fall of 2008, and he believed she was
competent when she changed her will and power of attorney.
4
In her deposition taken February 4, 2010, Shelton testified that she had not given
Natho permission to take title to her house, sell her car, change the ownership of her life insurance
policy, or write checks to himself on any of her bank accounts. During the deposition, Shelton
frequently could not remember the answers to questions she was asked and sometimes seemed
confused, such as when asked about the location of her house. At a deposition taken in November
2008, Natho admitted that he had probably spent $10,000 of Shelton’s money on his own behalf.
Sufficiency of the Evidence
In his first point of error, Natho argues that the evidence is insufficient to support the
jury’s verdict. We disagree.
We review evidentiary sufficiency by viewing all of the evidence in the light most
favorable to the verdict and asking whether a rational jury could have found guilt beyond a
reasonable doubt. Brooks v. State, 323 S.W.3d 893, 899, 912 (Tex. Crim. App. 2010). A person
misapplies fiduciary property if he holds property in a fiduciary capacity; intentionally, knowingly,
or recklessly deals with the property contrary to the agreement under which he held the property; and
the misapplication involves a substantial risk of loss to the property owner. Tex. Penal Code § 32.45.
Natho argues that the evidence is insufficient to show (1) that he and Shelton had an agreement about
how he was to handle Shelton’s property; (2) that he acted contrary to that agreement, claiming that
the power of attorney gave him the authority to “perform or undertake any action in her name that
she could have performed or undertaken herself”; (3) that his actions were contrary to the power of
attorney; or (4) that any misapplication gave rise to a substantial risk of loss to Shelton. He asserts
that the evidence establishes that while he was Shelton’s attorney-in-fact, he acted only to assist her
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and to qualify her for Medicaid coverage as soon as possible. Natho also contends that, because
there was no evidence about what happened to the money he received from Shelton’s assets, the
evidence is insufficient to show that the funds were used in a way that was inconsistent with
Shelton’s wishes or needs. We disagree.
Natho was convicted of misapplication of fiduciary funds valued at more than $1,500
but less than $20,000. Shelton gave Natho a general power of attorney, which is evidence of her
agreement with Natho about how he would handle her assets. However, she did not grant him the
authority to make gifts of her assets, and she testified that she did not give him permission to give
himself the car or her life insurance policy. See Gouldy v. Metcalf, 12 S.W. 830, 831 (Tex. 1889)
(authority conferred by power of attorney will be strictly construed to exclude exercise of any power
not warranted by document’s actual words or “as a necessary means of executing the authority with
effect”). Thus, the jury could have concluded that Natho acted contrary to his agreement with
Shelton in making gifts to himself from her estate. Furthermore, Natho signed the car over to
himself in April 2008, well before he consulted with Kernodle, and so cannot claim to have been
relying on Kernodle’s legal advice in doing so. Likewise, Shelton’s car, house, and most of the
cash value of the life insurance policy were all assets that would be excluded from Medicaid’s
calculations, and so their transfer out of Shelton’s estate did not benefit Shelton.
Although he “gifted” the car and life insurance policy to himself while he had power
of attorney, he was instructed to return Shelton’s property by Herbort’s September 5 letter. Instead
of transferring those assets back into her name, he sold the car for between $4,750 and $5,600 on
September 22, and cashed in the life insurance policy for $1,746 on September 25; there is no
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evidence that he returned those proceeds to Shelton’s estate. The jury could have inferred that he
did not use those proceeds on Shelton’s behalf or in a way that was consistent with her wishes. The
evidence is sufficient to support the jury’s determination that Natho misapplied assets valued
between $1,500 and $20,000. See Dwyer v. State, 836 S.W.2d 700, 702 (Tex. App.—El Paso 1992,
pet. ref’d) (defendant received cash from clients and applied to his own expenses, not to client’s
utility accounts; evidence was sufficient to show defendant misapplied fiduciary funds in manner
that involved substantial risk of loss to property owners). We overrule Natho’s first point of error.
Motion for Mistrial
In his second point of error, Natho contends that the trial court should have granted
his motion for a mistrial after Burthold violated a motion in limine by stating that a temporary
injunction had been granted against him. He asserts that the harm resulting from that statement
could not have been cured by an instruction to disregard. We disagree.
We review a trial court’s decision on a motion for mistrial under an abuse of
discretion and will only reverse if we find that prejudice was incurable and the error was so harmful
“that the case must be redone.” Hawkins v. State, 135 S.W.3d 72, 77 (Tex. Crim. App. 2004).
Unless the record reflects otherwise, we assume that the jury complied with a trial court’s instruction
to disregard. Thrift v. State, 176 S.W.3d 221, 224 (Tex. Crim. App. 2005). An instruction to disregard
will only be insufficient if the evidence leads to prejudice to a degree that it would be impossible to
withdraw “the impression produced on the minds of the jurors.” Ladd v. State, 3 S.W.3d 547, 567
(Tex. Crim. App. 1999).
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Burthold filed a civil suit against Natho, and the jury knew about the existence of
the civil case and even that there had been a hearing on a motion for temporary injunction. The
parties largely avoided discussing the civil case and whether the injunction had been granted, in
keeping with the trial court’s granting of the motion in limine. During Burthold’s testimony, she
was asked about her understanding of the effects of the warranty deed signed by Natho and whether
she believed that, as soon as Shelton died, the house went to Natho. She answered, “I understood
that before the temporary restraining order due to the cases, yes.” Natho’s attorney objected that
Burthold had violated the motion in limine, and the trial court responded that it would give an
instruction, saying, “[T]hey have talked about a trial and they know they—there’s been all kinds of
hearings here.” Natho argued that he was harmed because the jury would believe that the granting
of a temporary injunction “pretty much amounts to a—respectfully, a statement by the Court as to
the weight of the evidence in this case because it’s the same evidence.” The court denied Natho’s
motion for a mistrial and gave the jury a limiting instruction telling them not to draw any inferences
related to any rulings in the civil litigation.
On appeal, Natho argues that Burthold’s statement would have led a rational juror to
conclude that a judge had already found wrongdoing by Natho and that, because the evidence is
“insufficient to support [Natho’s] guilt in this case to begin with,” the trial court’s instruction would
not have cured the harm suffered by Natho. However, the record contains no indication that the jury
did not follow the trial court’s instruction, see Thrift, 176 S.W.3d at 224, and Burthold’s statement
was brief and vague enough that we cannot conclude that the trial court abused its discretion in
refusing Natho’s motion for a mistrial, see Hawkins, 135 S.W.3d at 77. We overrule Natho’s second
point of error.
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Conclusion
Having overruled both of Natho’s points of error, we affirm the trial court’s judgment
of conviction.
__________________________________________
David Puryear, Justice
Before Justices Puryear, Goodwin and Field
Affirmed
Filed: February 6, 2104
Do Not Publish
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