U.S. v. Fair

• Court: Court of Appeals for the Fifth Circuit
• Decided: November 23, 1992
• Docket: 92-02098
• Status: Published

Opinion

UNITED STATES COURT OF APPEALS for the Fifth Circuit

_____________________________________

No. 92-2098

UNITES STATES OF AMERICA,

Plaintiff-Appellee,

VERSUS

MARION EUGENE FAIR,

Defendant-Appellant.

______________________________________________________

Appeal from the United States District Court for the Southern District of Texas ______________________________________________________ (December 9, 1992) Before KING, JOHNSON, and DUHÉ, Circuit Judges.

DUHÉ, Circuit Judge:

Marion Eugene Fair ("Fair") appeals his conviction and

sentence. Fair was found guilty of the unlawful possession by a

previously convicted felon of a firearm that was shipped in

interstate commerce. See 18 U.S.C. § 922(g)(1) (Supp. 1992). The

district court sentenced him to 293 months incarceration, and

imposed a $20,000 fine. Fair challenges his conviction claiming

that certain evidence was improperly admitted. We find no error in

the district court's conduct of the trial, and affirm Fair's

conviction.

Fair also challenges the fine imposed upon him. We find that

the district court misapplied the relevant sentencing guidelines.

That part of the judgment imposing the fine is vacated and the case remanded to the district court for resentencing.

Federal and state drug agents executed a search warrant on a

house trailer. In one of the bedrooms the agents found two

handguns and some documents which indicated that the bedroom was

used by Fair. Fair was later indicted, convicted, and sentenced.

Without objection from Fair, the district court adopted the

facts in his presentence investigative report (PSR). It stated

that:

[Fair's] only assets are two old junk automobiles worth approximately $1,000.00. He stated he had no liabilities and his only income is about $50.00 per month he receives from family and friends. Prior to his incarceration in the instant case, he was only sporadically employed and has held no real stable employment for a number of years. Since he has been incarcerated most of his adult life, he does not appear to have any realistic ability to pay a fine within the guideline range.

Although no reasons were contemporaneously given for imposing the

$20,000 fine, in a supplemental sentencing memorandum the district

court stated: "The fine assessed was intended by the court to

represent a small portion of the defendant's cost of imprisonment

pursuant to guideline § 5E1.2(i)."1 The supplemental memorandum

also noted that the court did consider the PSR's statement

regarding Appellant's current inability to pay such a fine. The

1 U.S.S.G. § 5E1.2(i) states:

Notwithstanding of the provisions of subsection (c) of this section [minimum-maximum fine range], but subject to the provisions of subsection (f) herein [defendant's ability to pay], the court shall impose an additional fine amount that is at least sufficient to pay the costs to the government of any imprisonment, probation, or supervised release ordered.

(emphasis added).

2 court stated that a payment schedule could be worked out which

would enable Fair to pay off his fine after his release.

Fair challenges the trial court's decision to admit some of

the documents discovered during the search of the house trailer.2

Defense counsel objected to these documents on a relevancy basis,

contending that since Fair stipulated to being a convicted felon,

the TDC documents and the letter from the Texas Court of Appeals

were merely cumulative. The government argued that the documents

were addressed to Fair, and tended to prove that he occupied the

bedroom, and hence, constructively possessed the firearms. The

court admitted the documents and gave a limiting instruction

admonishing the jury to consider the documents only for the

purposes of establishing possession of the guns.

Fair also challenges the imposition of the $20,000 fine,

mounting a two-pronged attack: First, Fair asserts that it was

error to impose a fine after adopting the PSR which indicated that

he did not have the ability to pay any fine. Second, Fair argues

that the imposition of a § 5E1.2(i) cost of incarceration fine was

2 Fair objected to government's exhibits 9 through 15. Exhibit 9 is a letter from the Texas Department of Corrections (TDC) Staff Counsel for Inmates, and it discusses a possible appeal. Exhibit 10 is a memorandum from the TDC regarding prison work assignments. Exhibit 11 is a form letter denying a furlough request. This exhibit contains perhaps the most prejudicial material; one of the reasons checked for denial is "Inmate is a security risk and/or a threat to society for one or more of the following reasons[.]" Items checked are: (1) Length of sentence; (2) Lack of sufficient time served on sentence; and, (3) prior criminal history. Exhibit 12 is a letter from the Texas Court of Appeals acknowledging a prior communication from Fair, and Exhibit 13 is the envelope this came in. Exhibit 14 is a handwritten letter from Fair's sister, and Exhibit 15 is a parole certificate from the TDC.

3 a misapplication of the sentencing guidelines, as the trial court

did not impose an initial § 5E1.2(a) punitive fine.

DISCUSSION

A. The Admission of the Documents.

At trial, Fair objected to the relevancy of some of the

documents discovered during the search. He appears to concede the

relevancy of these documents in his appellate arguments, and now

contends that the district court erred in not performing a Beechum-

type weighing of their prejudicial impact. See United States v.

Beechum, 582 F.2d 898 (5th Cir. 1978), cert. denied, 440 U.S. 920

(1979).

Fair correctly cites Beechum for the proposition that where

evidence of "other offenses" is offered, the trial court must first

decide that the proffered material is relevant, and then weigh its

probative value against any prejudicial effect. Id. at 911 (citing

Fed. R. Evid. 403, 404(b)). What Fair overlooks, however, is that

to engage in this type of balancing, a court's attention must be

first directed to the issue. The unfair prejudice argument is

being raised for the first time on appeal. We therefore apply a

plain error standard of review. Fed. R. Crim. P. 52(b); United

States v. Loney, 959 F.2d 1332, 1341 (5th Cir. 1992). Our inquiry

is limited under this standard: "[W]hen a new factual or legal

issue is raised for the first time on appeal, plain error occurs

where our failure to consider the question results in 'manifest

injustice.'" United States v. Vontsteen, 950 F.2d 1086, 1096 (5th

4 Cir. 1992) (en banc).

Viewing the issue in the context of the entire case, see id.,

we cannot say that admission of the documents, if error, amounts to

manifest injustice. Fair maintained that he did not possess the

firearms, as required for a violation of 18 U.S.C. § 922(g)(1).

The documents Fair objected to were introduced to show that Fair

did reside in the house trailer, and that he therefore exercised

constructive possession of the weapons. Although other evidence

was introduced on this point, we cannot say that the trial court

committed plain error in allowing further proof on the possession

element.

B. Sentencing Issues.

1. Standard of Review.

We examine the sentence to ascertain if it was imposed in

violation of law, as a result of a misapplication of the sentencing

guidelines, or if it was outside of the guideline range and was

unreasonable. See 18 U.S.C. § 3742(e) (Supp. 1992). Findings of

fact are accepted if they are not clearly erroneous. Id.; United

States v. Matovsky, 935 F.2d 719, 721 (5th Cir. 1991).

2. Fair's Ability to Pay the Fine Imposed.

The district court adopted the PSR, which recommended against

imposing a fine. The PSR justified this by stating:

The defendant does not appear to have any assets which could be liquidated to pay fine [sic] immediately, nor does he appear to have the means to pay a fine on an installment basis after a lengthy period of incarceration.

At his sentencing, neither Fair nor the government objected to the

5 PSR, the sentence imposed, or the imposition of the $20,000 fine.

In a supplemental sentencing memorandum, the district court

reaffirmed the fine, and indicated that Fair's present indigency

was considered; however, the court stated that Fair could pay off

the fine in monthly installments after his release. See R. 1, at

193.

District courts are directed to impose a fine in all cases,

unless the defendant establishes that he will be unable to pay.

U.S.S.G. § 5E1.2(a). In determining the fine, the guidelines list

seven factors for consideration, including "any evidence presented

as to the defendant's ability to pay the fine (including the

ability to pay over a period of time) in light of his earning

capacity and financial resources[.]" Id. § 5E1.2(d)(2). Because

of the mandatory language of § 5E1.2(d) ("[T]he court shall

consider. . . . "), some circuits require that trial courts make

specific findings showing they properly considered the pertinent

factors in determining the fine amount. See, e.g., United States

v. Masters, 924 F.2d 1362, 1369 (7th Cir. 1991), cert. denied, 111

S. Ct. 2019 (1992); United States v. Seminole, 882 F.2d 441, 443

(9th Cir. 1989). We have declined to impose this requirement, as

there is no statutory or sentencing guideline intimation that such

detailed findings are necessary. United States v. Matovsky, 935

F.2d 719, 722 (5th Cir. 1991); see discussion at note 3, infra.

But see United States v. Pattan, 931 F.2d 1035, 1044 (5th Cir.

1991), cert. denied, 112 S. Ct. 2308 (1992) (sentencing court erred

in not explaining decision to impose cost of incarceration fine in

6 light of PSR's recommendation that this would impose severe

hardship on defendant's family).

A brief digression is necessary to analyze the apparent

divergent views espoused in Matovsky and Pattan. In Matovsky, the

district court adopted the PSR which made no recommendation on

imposing a fine. See 935 F.2d at 722. We held that it was not

error for the court to impose a fine within the guideline range

without making specific findings on Matovsky's ability to pay. Id.

The trial court in Pattan likewise adopted the PSR, but this report

recommended that neither a fine nor the cost of incarceration be

imposed on the defendant. See 931 F.2d at 1038. On appeal, we

held that "The only evidence we can find, that in the presentence

report, does not support the decision of the trial court. . . ."

Id. at 1044. Reading Matovsky and Pattan together, we can distill

the rule that specific findings are necessary if the court adopts

a PSR's findings, but then decides to depart from the PSR's

recommendation on fines or cost of incarceration.3

The necessity for such explanation is illustrated by this

case. Fair's PSR points out that he has limited future earning

3 A sentencing court is required, under certain circumstances, to give a statement of reasons for imposing a sentence. See 18 U.S.C. § 3553(c) (Supp. 1992); United States v. Pippin, 903 F.2d 1478, 1484-85 (11th Cir. 1990) (if applicable guideline range is greater than twenty-four months, court must provide reasons for imposing sentence at a particular point within this range). There is no statutory counterpart requiring articulated reasons for imposing a fine on an individual. See, e.g., United States v. Marquez, 941 F.2d 60, 65 (2d Cir. 1991) ("Since the requirement of subsection 3553(c)(1) is triggered only by the length of the sentence and not by the amount of the fine, the district court was under no special obligation to justify the magnitude of this fine.").

7 capacity, and little realistic chance of paying a large fine: Fair

has been incarcerated most of his adult life, he has minimal

education, and his work record is sporadic. Furthermore, Fair will

be sixty-six years old when he is released from his present

incarceration. Even with a monthly installment plan, we are hard

pressed to see how he will be able to pay off his $20,000 fine. On

remand, we urge the district court to consider these and the other

factors contained in Fair's PSR when determining whether it is

appropriate "to impose a fine that a defendant has little chance of

paying." United States v. Walker, 900 F.2d 1201, 1207 (8th Cir.

1990).

It is undisputed that the guidelines place the burden of

proving an inability to pay a fine squarely on the defendant. See

U.S.S.G. § 5E1.2(a), (f); United States v. Hagmann, 950 F.2d 175,

185 (5th Cir. 1991), cert. denied, 113 S. Ct. 108 (1992). If the

defendant makes such a showing, the court may impose a lesser fine,

or waive the fine altogether. U.S.S.G. § 5E1.2(f).

In Pattan, we held it was error for the district court to

adopt the PSR, and then depart from its recommendation on fines and

cost of incarceration, absent any reasons for such a departure.

See United States v. Pattan, 931 F.2d 1035, 1044 (5th Cir. 1991).

The only evidence before the court concerning Pattan's ability to

pay was the PSR. Id. We now take the step that we implicitly

relied on in Pattan, and hold that a defendant may rely on the PSR

to establish his inability to pay a fine or cost of incarceration.

This is not an anomalous position among the circuits. See, e.g.,

8 United States v. Rivera, 971 F.2d 876, 895 (2d Cir. 1992); United

States v. Cammisano, 917 F.2d 1057, 1064 (8th Cir. 1990); United

States v. Labat, 915 F.2d 603, 606 (10th Cir. 1990).

When a sentencing court adopts a PSR which recites facts

showing limited or no ability to pay a fine the government must

then come forward with evidence showing that a defendant can in

fact pay a fine before one can be imposed. See id.; United States

v. Walker, 900 F.2d 1201, 1206-07 & n.6 (8th Cir. 1990). For

example, the government can point to evidence of assets concealed

by the defendant,4 evidence of the future earning potential of the

defendant,5 and even evidence of the wealth of the defendant's

family.6 Once such a showing has been made, it is within the trial

court's discretion to consider the factors outlined in U.S.S.G. §

5E1.2(d), and determine if a fine should be applied, and if so, the

proper amount within the applicable guideline range. The trial

court should give its reasons for departing from the PSR's

recommendations on fines and costs of incarceration.

2. Cost of Incarceration Fine.

In the supplemental sentencing memorandum, the district court

explained that the $20,000 fine impose on Fair "was intended by the

Court to represent a small portion of the defendant's cost of

imprisonment pursuant to guideline § 5E1.2(i)." R. 1, at 193. The

4 See U.S.S.G. § 5E1.2, comment. (n. 6). 5 See U.S.S.G. § 5E1.2(d)(2). 6 See United States v. Fabregat, 902 F.2d 331, 334 (5th Cir. 1990).

9 full text of § 5E1.2(i) is quoted supra, in note 1; in pertinent

part this provision authorizes the sentencing court to impose "an

additional fine amount" to offset the cost of incarceration,

probation, or supervised release. U.S.S.G. § 5E1.2(i).

The plain language of this section indicates that a cost of

incarceration fine should only be imposed after a § 5E1.2(a)

punitive fine has been assessed. This is the interpretation other

circuits have adopted: "[F]undamental semantics dictates that a

subparagraph (i) fine cannot be 'additional,' unless it augments

another fine." United States v. Labat, 915 F.2d 603, 607 (10th

Cir. 1990); see also United States v. Corral, 964 F.2d 83, 84 (1st

Cir. 1992) ("[A] district court may not impose a duty to pay for

costs of incarceration or supervised release if the defendant is

indigent for purposes of a fine under Sentencing Guideline section

5E1.2(a).").

We find this reasoning persuasive, and hold that the

imposition of a cost of incarceration fine, U.S.S.G. § 5E1.2(i), is

not proper absent an initial punitive fine, Id. § 5E1.2(a). To

impose a cost recovery fine alone is a misapplication of the

sentencing guidelines. See Labat, 915 F.2d at 606-07. The trial

court in the instant case characterized Fair's $20,000 fine as a §

5E1.2(i) cost of incarceration fine, and did not delineate any

portion of it as a § 5E1.2(a) punitive fine. We must therefore

vacate the fine and remand the case for further consideration and

resentencing.

10 CONCLUSION

We hold that a defendant can properly rely on his presentence

investigative report to establish that he is unable to pay a fine

or cost of incarceration if the district court adopts the report.

The government can present evidence to counter this showing. The

district court must then weigh the applicable guideline factors and

decide if a fine is then appropriate, and if so, what amount in the

appropriate guideline range is to be imposed. If the court has

adopted a presentence report that recommended not imposing a fine,

the court must also articulate the reasons why it is departing from

the report. We further hold that it is a misapplication of the

guidelines to impose an "additional" cost of incarceration fine

absent an initial punitive fine.

We VACATE Fair's $20,000 fine and REMAND this case for further

consideration. Fair's conviction and sentence of incarceration are

otherwise AFFIRMED.