United States v. Robert E. Hines

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No. 95-3026
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United States of America, *
*
Plaintiff - Appellee, *
* Appeal from the United States
v. * District Court for the
* Western District of Missouri.
Robert E. Hines, *
*
Defendant - Appellant. *
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Submitted: February 13, 1996
Filed: July 10, 1996
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Before BOWMAN, LOKEN, and MORRIS SHEPPARD ARNOLD, Circuit Judges.
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LOKEN, Circuit Judge.
Robert E. Hines pleaded guilty to drug and firearm offenses. The
district court sentenced him to ninety months in prison and three years of
supervised release. The court also imposed a fine of approximately
$300,000, based upon the fact that Hines will receive $1,550,000 in
personal injury settlement payments over the next thirty-five years. Hines
appeals this fine. We conclude that, while the fine is not
constitutionally excessive, the district court erred in refusing to
consider "the burden that the fine will impose upon . . . any person who
is financially dependent on the defendant," namely, Hines's new wife and
stepson. 18 U.S.C. § 3572(a)(2); see U.S.S.G. § 5E1.2(d)(3). Accordingly,
we reverse and remand for resentencing.
Hines was charged with possession of an unregistered firearm in
violation of 26 U.S.C. § 5861(d), possession of cocaine with intent to
distribute in violation of 21 U.S.C. §§ 841(a)(1) and
(b)(1)(C), and use of a firearm in relation to drug trafficking in
violation of 18 U.S.C. § 924(c). On November 27, 1993, two days before his
arrest on those charges, Hines married, acquiring a stepson in the process.
He pleaded guilty to all three counts in February 1994 and was sentenced
in August 1995.
In 1986, Hines was hit by a truck, sustaining injuries that left him
23% permanently disabled. He settled his personal injury claim in 1989.
At the time of sentencing, the following "Deferred Lump Sum Payments"
remained to be paid under this settlement:
February 12, 1997 -- $ 25,000 February 12, 1999 -- $ 25,000
2002 -- $ 50,000 2004 -- $ 50,000
2007 -- $ 50,000 2009 -- $ 50,000
2012 -- $105,000 2014 -- $105,000
2017 -- $105,000 2019 -- $105,000
2022 -- $220,000 2024 -- $220,000
2027 -- $220,000 2029 -- $220,000
The settlement agreement provides that Hines may not accelerate, increase,
or decrease the deferred payments. It also states: "To the extent
provided by law, the aforesaid deferred lump sum payments shall not be
subject to transfer . . . or encumbrance."
At sentencing, the district court advised that it intended to take
these future payments into account in imposing an appropriate fine. The
government urged that the fine be payable immediately because Hines will
not receive the bulk of the settlement proceeds for more than twenty years,
but the court may only require installment payments of a fine for five
years, and the government's lien securing the payment of a fine expires in
twenty years (unless Hines agrees to a longer term). See 18 U.S.C.
1
§§ 3572(d), § 3613(b). Counsel for Hines argued that the court must
consider
1
These limitations were repealed by section 207 of the
Antiterrorism and Effective Death Penalty Act of 1996, for
convictions after the effective date of that Act. See Pub. L. No.
104-132, § 207, 110 Stat. 1214, 1236-39 (1996).
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the needs of Hines's new wife and stepson. The court responded that
responsibilities Hines took on after the charges were brought "cannot be
of any concern to me."
The court imposed a fine of $150,000 plus incarceration costs of
$1734 per month.2 The court made the entire fine payable immediately.
Thus, the government will be entitled to the full amount of each deferred
settlement payment until the year 2012, some ten years after Hines is
released from prison. On appeal, Hines challenges the amount of the fine,
and the fact that its terms of payment leave his wife and stepson with no
financial support during his incarceration. He notes that his wife
recently lost her job, his stepson has large medical bills, and the
settlement payments will average only $12,500 per year until 2002. He
further argues that the fine is excessive under the Eighth Amendment -- it
is "ten time greater than the largest fine imposed in the Western District
of Missouri at any time from the commission of his criminal conduct to the
date of sentencing."
"[T]he Guidelines require that '[t]he court shall impose a fine in
all cases, except where the defendant establishes that he is unable to pay
and is not likely to become able to pay any fine.' U.S.S.G. § 5E1.2(a)."
United States v. Aguilera, 48 F.3d 327, 329 (8th Cir.), cert. denied, 116
S. Ct. 117 (1995). The Guidelines further require that, "[i]n determining
the amount of the fine, the court shall consider" a number of factors,
including "the burden that the fine places on the defendant and his
dependents relative to alternative punishments." U.S.S.G. § 5E1.2(d)(3).
Hines has a legal obligation to support his wife and stepson. See Tyron
v. Casey, 416 S.W.2d 252, 260 (Mo. App. 1967) (husband must support
2
The parties estimate these additional costs at about
$150,000. The court explained its decision by noting that the
settlement provided Hines with income of $40,000 per year for forty
years, and the total fine of some $300,000 is approximately $40,000
for each year of Hines's incarceration.
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his wife); Mo. Rev. Stat. § 453.400(1) (stepparent must support stepchild
living in the home to the same extent as a natural or adoptive parent).
The Guidelines make no distinction based upon when dependents were
3
acquired, nor the length of the dependent relationship. The district
court erred in ignoring this mandatory sentencing factor. See Aguilera,
48 F.3d at 328 (application of the Guidelines is reviewed de novo); United
States v. Bauer, 19 F.3d 409, 412-13 (8th Cir. 1994).
Accordingly, we must remand for resentencing. Because few cases
discuss the imposition of fines under the Guidelines, or the impact of the
Eighth Amendment prohibition on "excessive fines," we add the following
comments concerning these sentencing issues.
First, we are concerned that the record does not permit a comparison
between the amount of the immediately payable fine and Hines's present
ability to pay a fine. If the fine were deferred in the same manner as the
settlement payments, then we could compare $300,000 to $1,550,000 in
determining Hines's ability to pay and the impact of the fine on his
dependents. But Congress does not allow long-deferred fine obligations,
and it only provides the government a twenty-year lien, so the district
court made the fine payable immediately. Obviously, that term makes the
fine, in the short run, greatly exceed Hines's ability to pay.
To determine the appropriate level of a payable immediately fine
under the Guidelines, the court needs to determine the present value of the
deferred payment stream. This is relevant because Hines may be required
to liquidate this right to future income (or any other illiquid asset) to
meet his obligation to pay an appropriate fine. The question is
complicated here by the anti-alienation and anti-encumbrance provisions of
the settlement
3
The government makes no showing that Hines married with the
intent to avoid imposition of a fine.
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agreement. But in exploring the present value of the deferred payments,
the district court may learn that these provisions are not a complete
obstacle to realizing that present value. And of course, if Hines were to
refuse either to take available steps to realize the present value of this
asset, or to enter into an agreement with the government extending the life
of its lien, the court should take that into account in balancing the
competing needs of his dependents, or in fashioning appropriate alternative
sanctions.
Second, we are concerned that the terms of the fine and the
conditions of Hines's supervised release have not been properly integrated.
The standard Judgment and Commitment Order used in the Western District of
Missouri provides: "Unless otherwise ordered by the court, any financial
penalty imposed by this order shall be due and payable during the period
of incarceration, with any unpaid balance to be a condition of supervised
release." Violation of a condition of supervised release allows the court
to revoke supervised release and impose further sanctions, including an
additional term in prison. See 18 U.S.C. § 3583(e). Therefore, it is an
abuse of discretion to impose as a condition of supervised release the
immediate payment of a fine if the defendant's ability to pay that fine is
based upon post-supervised release income.4
Finally, we reject Hines's contention that the fine imposed violates
the Eighth Amendment command that "[e]xcessive bail shall not be required,
nor excessive fines imposed . . . ." There are few cases interpreting the
Excessive Fines Clause. Supreme Court decisions suggest that the
determination of excessiveness should be based, at least in part, on
whether the fine is disproportionate to the crime. See Alexander v. United
States, 113 S. Ct. 2766, 2775
4
A defendant may not constitutionally be incarcerated solely
because he cannot pay a fine through no fault of his own. See
Bearden v. Georgia, 461 U.S. 660, 672-73 (1983); Lincoln v. United
States, 12 F.3d 132, 133 (8th Cir. 1993) (per curiam).
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(1993); Harmelin v. Michigan, 501 U.S. 957, 1009 (1991) (White, J.,
dissenting). We require proof of "gross disproportionality," an
excessiveness so great that "the punishment is more criminal than the
crime." United States v. Alexander, 32 F.3d 1231, 1235, 1237 (8th Cir.
1994). See United States v. Bieri, 68 F.3d 232, 236 (8th Cir. 1995), cert.
denied, 116 S. Ct. 1876 (1996).
The above cases involved forfeitures, not monetary fines.
Proportionality is likely to be the most important issue in a forfeiture
case, since the claimant-defendant is able to pay by forfeiting the
disputed asset. In imposing a fine, on the other hand, ability to pay
becomes a critical factor. But the Guidelines mandate that this factor be
considered, see § 5E1.2(d)(2) and (f), and if the sentencing court complies
with these provisions, any constitutional ability-to-pay limitation will
necessarily be met. Here, for example, the amount of the fine, $150,000,
is well within the statutory maximum of $1 million. See 21 U.S.C.
§ 841(b)(1)(C). It is consistent with the Guidelines, see U.S.S.G.
§ 5E1.2(c)(4), and the additional fine for Hines's costs of incarceration
is specifically authorized and clearly proportional to his crimes. See 18
U.S.C. § 3572(a)(6); U.S.S.G. § 5E1.2(i); United States v. Price, 65 F.3d
903, 908 n.7 (11th Cir. 1995), cert. denied, No. 95-1579, 64 U.S.L.W. 3670
(Jun. 24, 1996). Thus, when the district court properly considers the
factors prescribed in § 5E1.2(d) on remand, the fine it imposes will not
be constitutionally excessive.
The judgment of the district court is reversed and the case is
remanded for further proceedings consistent with this opinion.
A true copy.
Attest:
CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.
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