United States v. Merric

Opinion

USCA1 Opinion

                 United States Court of Appeals

                     For the First Circuit


No. 98-1455



                          UNITED STATES,



                            Appellee,



                                v.



                         MICHAEL MERRIC,



                            Appellant.


APPEAL FROM THE UNITED STATES DISTRICT COURT



                    FOR THE DISTRICT OF MAINE



           [Hon. Morton A. Brody, U.S. District Judge]


Before



                     Boudin, Circuit Judge,

Gibson, Senior Circuit Judge,

and Lipez, Circuit Judge.


Dawn M. Pelletier with whom Pelletier & Faircloth was on brief

for appellant.

     Margaret D. McGaughey, Assistant United States Attorney, with

whom Jay P. McCloskey, United States Attorney, and James L.

McCarthy, Assistant United States Attorney, were on brief for

appellee.


January 29, 1999


BOUDIN, Circuit Judge.  On May 21, 1996, Michael Merric

walked into the Margaret Chase Smith Federal Building in Bangor,

Maine, with a homemade, double-barreled shotgun tucked into a

bedroll.  He told the security officer that he was going to the

office handling social security matters in order to change his

address.  Later information reveals that Merric was at the time

homeless and mentally disturbed.

  The shotgun was discovered after Merric placed the

bedroll on the conveyor belt of the x-ray machine at the building's

entrance.  The search revealed Merric was carrying several rounds

of ammunition for the shotgun.  He was arrested and later charged

with possession of a firearm not registered to him in the National

Firearms Registration and Transfer Record in violation of 26 U.S.C.

 5861(d), 5871.

  In November 1996, after psychiatric evaluations and an

incompetency hearing before a magistrate judge, the district court

affirmed and adopted a recommendation that Merric was found

incompetent to stand trial.  Thereafter, Merric was confined to a

federal prison hospital facility in Buttner, North Carolina, until

November 1997, when he was found competent and released from the

hospital.  The diagnosis was that Merric suffered from

schizophrenia.

  In December 1997, Merric was indicted on the firearms

offense already described.  Shortly before his scheduled trial in

February 1998, Merric pled guilty.  In April 1998, the district

judge sentenced Merric to time already served in federal custody,

a $4,000 fine, and a three-year term of supervised release

conditioned, inter alia, on his repayment of $3,000 in counsel fees

paid to Merric's assigned counsel by the government under the

Criminal Justice Act.  Merric now appeals from the final judgment,

challenging the fine and the requirement that he repay counsel fees

as a condition of supervised release.

  Merric's first argument against the fine is that the

district judge made inconsistent findings regarding Merric's

ability to pay.  This argument turns on the fact that the

"judgment"--an eight-page form document--contains a page captioned

"Statement of Reasons" which, in addition to other information

(e.g., offense level, criminal history category) has a next-to-last

sentence reading:  "Fine waived or below the guideline range

because of inability to pay."

  It is evident from the record as a whole that the

district judge deliberately considered whether Merric should be

fined and concluded that he did have the ability to pay a $4,000

fine.  At the sentencing hearing, the district judge heard

testimony, which Merric did not contest,  that Merric was to

receive about $20,000 in accrued social security disability

benefits, heard Merric's objection to the imposition of any fine,

rejected the government's recommendation of a fine of $15,000,

stated that the court did not "see why a reasonable fine at the low

end of the scale would not be appropriate," and then, "with all

this in mind," imposed a $4,000 fine.  The page in the judgment

"Criminal Monetary Penalties" specifies that a fine is imposed in

the amount of $4,000.  The separate memorandum entered on the same

day by the district judge explicitly states that "[t]he defendant

is able to pay a minimal fine but is not able" to pay more even in

installments.  In short, the "inability to pay" finding is patently

a clerical error--as defense counsel came close to admitting at

oral argument--and the case bears no relation to United States v.

Momen, 104 F.3d 905, 911-13 (7th Cir. 1997), where there were

genuine ambiguities.

  Merric's second challenge to the fine is that the

district court erred in not expressly considering or making

findings on the factors outlined in 18 U.S.C.  3572(a).  The

statute provides that in addition to more general factors bearing

on punishment (see id.  3553(a)), the court in considering a fine

should take account of such factors as the defendant's income,

earning capacity, financial resources, and the burden of the fine

imposed on the defendant and on anyone who is dependent on the

defendant or who would be responsible for the welfare of a person

financially dependent on the defendant.

  This court has ruled that "a district court need not make

express findings regarding a defendant's financial condition so

long as the record is sufficient for adequate appellate review." 

United States v. Peppe, 80 F.3d 19, 22 (1st Cir. 1996).  See alsoUnited States v. Wilfred Am. Educ. Corp., 953 F.2d 717, 720 (1st

Cir. 1992).  Where the pertinent information is presented in the

district court, this court will assume that the district court

considered it.  Id. at 719.  Here, the district court learned that

Merric planned to remain in Ellsworth, Maine, and to live on his

social security disability benefits of $835 per month after his

release.  His parents were willing to pay for him to stay at a

hotel in Bangor for the time being.  Merric, as already said, was

also entitled to $20,000 in back benefits.

  On this appeal, Merric points out that combining the

$4,000 fine with $3,000 in counsel fees represents a considerable

portion of his $20,000 net worth (he has no other assets or

liabilities) and makes it more difficult to start a new life and

get himself out of poverty.  On the other hand, there is a

presumption that the defendant will pay a fine.  See U.S.S.G. 

5E1.2(a); United States v. Lombardi, 5 F.3d 568, 572 (1st Cir.

1993), and the burden is on the defendant to show that his case

warrants an exception.  Peppe, 80 F.3d at 22.  On the facts before

the district judge, there was nothing improper about the decision

to impose a $4,000 fine.

  Merric's final objection to the fine is that the district

court erred in "delegating" to the probation officer the schedule

for paying the fine.  Merric points out that the memorandum

accompanying the judgment includes a paragraph providing that

Merric is to pay a fine of $4,000 to the Clerk's Office in Bangor

and continues:  "Any amount that the defendant is unable to pay now

shall be paid in monthly installments, to be determined in amount

by the supervising officer, during the period of his supervised

release."  There is little doubt that this language was meant to

govern, even though the judgment contains a boilerplate statement

that the fine was due "[i]n full immediately."

  The government first says that we should review Merric's

claim only for plain error because no objection was raised at

sentencing to the allegedly improper delegation.  The difficulty is

that there is no indication that Merric was told at the sentencing

hearing that a payment schedule for the fine would be delegated to

the probation officer; it appears that Merric learned of this only

after the formal judgment had been entered.  Thus, the government

is effectively arguing that to preserve his claim, Merric had to

return to the district judge with a post-judgment motion.  Cf. Fed.

R. Crim. P. 35(c).

  Most "errors" occur in a context in which counsel is on

notice that the court is taking or has just taken an objectionable

action.  In such a case the failure to object does normally remit

the defaulting party whatever protection the plain error doctrine

affords.  E.g., Fed. R. Evid 103(a); Fed. R. Civ. P. 51.  But where

the error occurs in the judgment itself, there is no settled

general rule that counsel has to return to the district court and

seek correction there.  Efficient though this result might be, this

is no occasion for us to create such an exhaustion requirement,

which could well entail problems of its own.

  Although this court has not previously ruled on the

delegation issue, we agree with Merric that the district judge

could not empower the probation officer to make a final decision as

to the installment schedule for payments.  The text of 18 U.S.C. 

3572(d)(2) may not be conclusive in saying that "[t]he length of

time over which scheduled payments will be made shall be set by the

[sentencing] court" (conceivably, "set" could include delegation);

but we join the other circuit courts that have held that it is the

inherent responsibility of the judge to determine matters of

punishment and this includes final authority over all payment

matters.  The government does not explicitly disagree.

     The government points out that in United States v. Lilly,

80 F.3d 24, 29 (1st Cir. 1996), we read a judgment requiring

restitution "as directed" by the probation officer to reserve final

authority to the district court.  But Lilly is not on all fours,

because we there relied on a later explanation by the district

judge that he had not given the probation officer the authority to

set a binding payment schedule.  Id.  Because we think that the

judge rather than the probation officer must have the final

authority to determine the payment schedule, we will vacate the

sentence and remand so that the district judge can insert into the

judgment a phrase or sentence making this reservation of authority

explicit.

     We now turn our attention to the other element of the

sentence challenged by Merric on this appeal, namely, the district

court's requirement that Merric repay the government the counsel

fees it paid for his representation, an amount that later proved to

be about $3,000.  It clear enough that the district court can

require such repayment, since 18 U.S.C.  3006A(f) so provides. 

However, Merric objects to making this repayment a condition of

supervised release.

     The transcript shows that Merric was explicitly advised 

at the sentencing hearing that the judgment would contain such a

provision and neither he nor his counsel made any objection to it. 

Accordingly, the imposition of this condition is reviewed for plain

error only.  This requires Merric to establish "an obvious and

clear error under law" that "seriously affect[s] the fairness,

integrity or public reputation of judicial proceedings."  United

States v. Phaneuf, 91 F.3d 255, 263 (1st Cir. 1996) (quoting United

States v. Olano, 507 U.S. 725, 736 (1993)).

     As it happens, we think that the district court's

decision to make repayment a condition of supervised release was

not error at all.  Admittedly, there has been a certain amount of

disagreement among the circuits--not as to whether CJA counsel fees

can be recovered from a defendant (the statute specifically permits

it)--but as to whether such repayment can be made a condition

either of probation or of supervised release.  Merric has, or

shortly will have, the funds to repay the government, and the issue

here is merely whether the district judge had authority to make

this a condition of supervised release.

     The statute governing conditions of supervised release,

18 U.S.C.  3583(d), requires the court to order certain

conditions--not relevant here--for any supervised release and then

provides that the court "may" order "any other condition it

considers to be appropriate" so long as the condition is (1)

reasonably related to certain specified statutory factors, (2)

involves no greater deprivation of liberty than is reasonably

necessary to satisfy certain specified statutory purposes, and (3)

it is consistent with any pertinent policy statements issued by the

Sentencing Commission.  The statutory factors and purposes

specified--taken by cross-reference from a longer list set forth in

18 U.S.C.  3553(a) as factors generally to be considered in

imposing a sentence--are (so far as arguably pertinent here) the

following:

     --   "the need . . . to afford

          adequate deterrence to criminal

          conduct," 18 U.S.C. 

          3553(2)(B), and



     --   "the need . . . to protect the

          public from further crimes of

          the defendant," id. 3553(2)(C).



     In our view, imposing the cost of CJA counsel on the

defendant, where the defendant proves able to pay, is a deterrent

to crime just like any other financial imposition.  That monetary

payments deter crime is the notion that underlines the elaborate

code of fines reflected in the Federal Criminal Code and the

Sentencing Guidelines.  This point has been explained so thoroughly

by Judge Easterbrook, sustaining a requirement that defendant pay

the cost of a 90-day work release program to which he had been

sentenced, that further discussion of this point is unnecessary. 

United States v. Turner, 998 F.2d 534, 536-38 (7th Cir.), cert.

denied, 510 U.S. 1026 (1993).

     The condition that Merric repay counsel fees out of

available funds is thus "reasonably related" to deterrence, one of

the factors specified by Congress, and therefore also satisfies a

further factor ("the need to protect the public from further crimes

of the defendant").  Congress' second requirement in 18 U.S.C. 

3583(d)--that the condition "involve[ ] no greater deprivation of

liberty than is reasonably necessary" for deterrence or other

specified factors, 18 U.S.C.  3583(d)--is satisfied not only

because (among other reasons) Merric can afford to pay but also

because he will not be deprived of liberty at all.  The final

requirement under the statute is that the condition be "consistent

with any pertinent policy statements" issued by the Sentencing

Commission.  Id.

     The guideline addressed to "conditions of supervised

release" (U.S.S.G.  5D1.3) is replete with repayment conditions: 

these include, as mandatory conditions, adherence to an installment

schedule to pay any yet unpaid fine and payment under various

sections for victim restitution.  Id.  5D1.3(a)(5),(6).  Among

recommended standard conditions, the Commission suggests that the

defendant be required to provide support to the defendant's

dependents and meet other family responsibilities, and also that

the defendant pay the statutory special assessment or adhere to a

court-ordered installment schedule for paying it.  Id. 

5D1.3(c)(4), (14).

     Given the number of repayment conditions that the

Commission either required or encouraged, the requirement to repay

CJA counsel fees is facially consistent with the Commission's

policy guidelines.  Of course, one could argue that the guideline's

failure to require or recommend repayment of counsel fees as a

standard condition suggests that the Commission was opposed to such

a requirement, but it is at least as likely that the Commission did

not focus upon the issue.  In any event, the same guideline

provision provides that the court "may impose other conditions of

supervised release" so long as they meet the three requirements set

forth by Congress and already described.

     This court has held that the requirement that counsel

fees be repaid to the government is a proper condition of

probation.  United States v. Santarpio, 560 F.2d 448 (1st Cir.),

cert denied, 434 U.S. 984 (1977).  Although the case contains

language consistent with our present view, Santarpio is a pre-

guideline case and we have preferred therefore to make our own

analysis of the statute and guidelines.  However, it is worth

adding that we are not persuaded by the Ninth Circuit's decision in

United States v. Eyler, 67 F.3d 1386 (9th Cir. 1995), which holds

that repayment of counsel fees cannot be made a condition of

supervised release and saying without explanation that such a

condition does not serve the purposes of deterrence.

     To say that repayment of counsel fees is a permissible

condition of probation or supervised release is a different

question from whether such a condition is wise, an issue that is

primarily one for the district court.  Here, no such objection was

made in the district court.  In any case, the record there showed

that Merric was about to receive a large sum in back payments for

social security disability--some of it seemingly for a period in

which the government was maintaining him in a prison hospital at

Buttner--and the district court was told nothing that would

reasonably have given it pause in requiring that a small portion of

the $20,000 back payment should reimburse the Treasury for what it

had just spent on Merric's behalf to provide him with counsel.

     Obviously, a court could not properly make it a condition

of probation or supervised release that a penniless defendant make

immediate payments, nor can we imagine sending defendant back to

jail where he had done his best to comply with an installment

schedule.  See Santarpio, 560 F.2d at 455.  Further, there may be

circumstances in which requiring repayment of counsel fees even on

an installment basis would interfere with the defendant's other

obligations (such as paying fines or support payments).  Here, the

amount in question was modest and well covered by the prospective

back payments for social security.

     Merric draws our attention to a Judicial Conference

recommendation which urges as a matter of policy that repaying the

cost of counsel "should not be made a condition of probation." 

The reason for the recommendation is unclear: possibly the Judicial

Conference had primarily in mind the risk that a defendant,

otherwise eligible for probation, might be denied this opportunity

for lack of funds.  It is also possible that the Judicial

Conference was concerned with discouraging a defendant from

accepting appointed counsel, although this seems unlikely since

acquittal is usually a defendant's main objective.

     In all events, while the views of the Judicial Conference

are entitled to respectful attention on any matter--and on a few

matters have binding legal force--the lawfulness of particular

conditions of probation and supervised release are governed solely

by statute and by the guidelines of the Sentencing Commission. 

Further, we are here dealing with supervised release and, in the

absence of explicit rationale for the Judicial Conference

recommendation, we have no idea whether its reasons also apply to

supervised release or to a case in which the defendant has

virtually in hand the money necessary to repay counsel fees. 

Accordingly, the recommendation does not control in this case.

     There is one final matter to address.  At oral argument

Merric's able counsel informed the court that it now appears that

very expensive drugs are important in controlling Merric's

schizophrenia and that he may not be able to afford these drugs,

which could increase his ability to function lawfully in society. 

Candidly admitting that this issue had never been presented to the

district court, defense counsel urged that this unusual need ought

to be taken into account in assessing Merric's ability to pay the

$4,000 fine (and so far as appears, this same argument can be made

as to counsel fees).

     The government responded at oral argument that avenues

exist for Merric to raise this medical-need issue in the district

court even after the judgment becomes final, but our own

preliminary review suggests to us that the district court might

have little flexibility to remit or reduce the fine if we simply

affirmed.  Seemingly, 18 U.S.C.  3573 does no more than permit the

government to move to remit unpaid portions of a fine or a special

assessment where "reasonable efforts to collect . . . are not

likely to be effective."  Fed. R. Crim. P. 35(b) also permits the

government to move for a reduction in sentence but only where the

defendant provides substantial assistance.

     Needless to say, Merric's need for medicine, assuming the

allegations are true, does not in any way invalidate any of the

payment obligations imposed by the district court, the issue having

never been raised and there being no plain error on this record. 

However, we have already concluded that the judgment should be

remanded to correct the judgment on the delegation issue, and we

have broad authority to shape a remand in the interests of justice. 

See 28 U.S.C.  2106.  Exercising this authority, we expressly give

the district court leave to consider any argument based on Merric's

alleged need for medicine.

     Merric has not argued either in the district court or on

this appeal that consideration of Merric's back payments for social

security disability--merely to determine his ability to pay a fine

or repay counsel fees--is at odds with the anti-assignment

provision of the social security statute.  42 U.S.C.  407.  The

point is an obscure one, raised more by case law than statutory

language; and we take no position on it since there is certainly no

plain error.  However, again in the interests of justice, the

district court is free to consider the matter if it chooses.

     The sentence but not the conviction is vacated, and the

matter is remanded to the district court for further proceedings

consistent with this opinion.

     It is so ordered.