IN THE CASE OF
UNITED STATES, Appellee
v.
Michael A. PAULING, Specialist
No. 02-0603
Crim. App. No. 9700685
Argued
Decided
GIERKE, J., delivered the opinion of the Court, in which
CRAWFORD,
C.J., and EFFRON J., joined. ERDMANN, J., filed a separate opinion concurring in
part and
dissenting
in part. BAKER, J.,
filed a separate dissenting opinion.
Counsel
For Appellant: Captain Craig A. Harbaugh (argued); Colonel Robert D. Teetsel, Lieutenant Colonel Mark Tellitocci, Major Allyson G. Lambert (on brief); Colonel Adele H. Odegard, Lieutenant Colonel E. Allen Chandler, Jr., Major Imogene M. Jamison, and Captain Mary E. Card.
For Appellee: Captain Charles C. Choi (argued); Colonel Lauren B. Leeker, Lieutenant Colonel Margaret B. Baines, and Major Theresa A. Gallagher (on brief).
Military Judge: R. J. Hough
This opinion is subject to
editorial
correction before final publication.
Judge GIERKE delivered the opinion of the Court.
This case concerns how to charge a “double forgery,” which occurs where a check has both “a forged payor signature and a forged indorsement.” Black’s Law Dictionary 661 (7th ed. 1999). Forging a drawer’s signature on a check violates Article 123, Uniform Code of Military Justice [hereinafter UCMJ], 10 U.S.C. § 923 (2000). Forging an indorser’s signature on a check also violates Article 123. Where both the drawer’s signature and the indorser’s signature are forged on the same check, has one forgery offense occurred or two? We hold that the Government may properly charge a “double forgery” as two separate offenses.
I. BACKGROUND
A. Case History
In accordance with Appellant’s guilty pleas, a general court-martial convicted him of making a false official statement, two specifications of larceny, and two specifications of forgery, in violation of Articles 107, 121, and 123, UCMJ, 10 U.S.C. §§ 907, 921, and 923 (1994). A panel of officer and enlisted members sentenced him to a bad-conduct discharge, confinement for three years, total forfeiture of pay and allowances, and reduction to the lowest enlisted grade. The convening authority approved the sentence as adjudged.
The Army Court of Criminal Appeals affirmed the findings and sentence in a divided unpublished opinion.1 We granted review to determine whether separately charging the forgery of the drawer’s signature and forgery of the indorser’s signature on the same check violates the prohibitions against multiplicity or the unreasonable multiplication of charges.2
B. Facts
Appellant was charged with forging 16 checks.3 He made 12 of the checks payable to himself and four payable to his wife. One specification charged him with forging the writing on the front of the checks, including the drawer’s signatures. A separate specification charged him with forging his wife’s signature as the indorser on the four checks made payable to her.
Before entering pleas, the defense moved to dismiss the specification alleging the forged indorsements, arguing that it was multiplicious with the specification alleging forgery of the writing on the front of the checks. Citing our opinion in United States v. Weymouth, 43 M.J. 329 (C.A.A.F. 1995), the defense counsel offered three rationales: (1) the specification alleging the forged checks “covers” the specification alleging the forged indorsements; (2) the two specifications apply to misconduct that was “substantially one transaction”; and (3) “this is just simply multiplication of charges.” The military judge deferred ruling on the motion. Appellant then pleaded guilty to all of the charges and specifications.
After the providence inquiry, the military judge ruled that the two specifications at issue were multiplicious for sentencing purposes, but not for findings purposes. This reduced the maximum authorized period of confinement from 115 years to 95 years. After that ruling, Appellant indicated his continued desire to plead guilty. The military judge then entered findings of guilty to all charges and specifications.
During
the providence inquiry, Appellant explained that he acquired possession
of the
checkbook of his civilian roommate, Little Joe M. Sandoval. Appellant forged 12 of the checks payable to
himself and, without his estranged wife’s knowledge, made four payable
to
her. He explained that he made some
payable to his wife “so I wouldn’t have so many in my name.” He indorsed the four checks with his wife’s
forged signature and successfully negotiated them at a federal credit
union in
II. DISCUSSION
A.
Multiplicity
When
Appellant forged Mr. Sandoval’s signature as the drawer of the four
checks at
issue, he clearly violated Article 123 because those signatures, if
genuine,4
would make Mr. Sandoval legally liable to pay the amounts stated on the
checks.
See Manual for
Courts-Martial,
Double
forgeries “are not
uncommon, because a criminal forging the drawer’s signature and hoping
to
escape detection is unlikely to make the bogus check payable to himself or herself. Therefore,
many forged checks are made payable
to third parties whose endorsements are then also forged, creating a
double
forgery.” Alvin C. Harrell, Impact of
Revised UCC Articles 3 and 4 on Forgery and Alteration Scenarios,
51
Consumer Fin. L.Q. Rep. 232, 239-40 (1997).
Despite the common nature of double forgery, the issue of
whether an
accused may be separately convicted of forging a drawer’s signature and
an
indorsement on the same check is a question of first impression in the
military
justice system.
An
unconditional guilty plea waives a multiplicity issue unless the
offenses are
“‘facially duplicative,’ that is, factually the same.”
In this
case, Appellant entered an unconditional plea of guilty and persisted
with that
plea after the military judge denied the defense’s multiplicity motion. Accordingly, we will find multiplicity only
if the specification alleging forgery of the checks facially duplicates
the
specification alleging forgery of the indorsements.
The two
specifications are not facially duplicative.
Rather, they separate the information on the front of the
checks, which
is expressly alleged in one specification, from the indorsements forged
on
their backs, which is alleged in another.
As the Army Court of Criminal Appeals noted, “the precise
language of
the specification” alleging forgery of the checks “includes only the
check
numbers, dates, payees, amounts and payors, but not the endorsement signatures.” Pauling, No. 9700685, slip
op. at 4. The specification alleging
forgery of the checks does include Mrs. Pauling’s name as the relevant
checks’
payee. However, the other specification
alleges the factually distinct act of forging her signature as the
indorser. We agree with those state courts
that have
recognized forgery of an indorsement as not only factually distinct,
but also
legally distinct from forgery of the check itself.5
A double
forgery creates two victims. Forging Mr.
Sandoval’s name as the drawer imposed an apparent legal liability on
him to pay
the face amount of the check.
Additionally, under the law of the jurisdiction where the checks
were
negotiated,6 the indorser
is obligated
to pay a check’s face amount in the event of dishonor.
The risk that such an obligation will arise is
particularly high where a check bears a forged drafter’s signature,
thus
providing a basis for its dishonor.
Forging Mrs. Pauling’s name as the check’s indorser therefore
imposed an
apparent legal liability on her, as well.
Holding that forgery of the drawer’s signature is multiplicious
with
forgery of the indorser’s signature would ignore one of the double
forgery’s
two victims.
As
Appellant demonstrated all too well, negotiating a forged check can be
accomplished with or without a forged indorsement.
Attempting to deceive by falsely indorsing a
check with an actual person’s name7 subjects that
person to apparent financial
liability, thereby satisfying all of the elements of forgery. See MCM,
Part
IV, para. 48.(b).(1).
Such a false indorsement could also lead law
enforcement authorities to suspect an innocent person of having forged
the
check itself.
For example, in
this case Appellant’s misdeeds
resulted in law enforcement officials interviewing his wife,
fingerprinting
her, obtaining handwriting exemplars from her, and taking her sworn
statement.
Accordingly,
we decline to establish a “two forgeries for the price of one” rule.
B.
Unreasonable Multiplication of Charges
Appellant
also complains that charging the forged indorsements in a separate
specification from the forgery of the writing on the front of the
checks
resulted in an unreasonable multiplication of charges.
“What is substantially one transaction should
not be made the basis for an unreasonable multiplication of charges
against one
person.” Rule for Courts-Martial 307(c)(4) discussion. “Unreasonable
multiplication
of charges is reviewed for
an abuse of discretion.”
(1) Did the
accused object
at trial that there was an unreasonable multiplication of charges
and/or
specifications?
(2) Is each
charge and
specification aimed at distinctly separate criminal acts?
(3) Does the
number of
charges and specifications misrepresent or exaggerate the appellant’s
criminality?
(4) Does the
number of
charges and specifications unreasonably increase the appellant’s
punitive
exposure?
(5) Is there
any evidence of
prosecutorial overreaching or abuse in the drafting of the charges?
See Quiroz,
55 M.J. at 338 (approving with
modification test established by United States v. Quiroz, 53
M.J. 600, 607
(N-M. Ct. Crim. App. 2000)). These
factors must be balanced, with no single factor necessarily governing
the
result.
Even assuming that the defense counsel satisfied the first Quiroz criterion when he objected that “this is just simply multiplication of charges,” the defense has not satisfied any of the other four Quiroz criteria.
Regarding the second Quiroz criterion, we have already concluded that the specification alleging forgery of the writing on the front of the checks was aimed at distinctly separate criminal acts from the specification alleging forgery of the indorsements.
Nor can Appellant meet the third Quiroz criterion, which considers whether the charges exaggerate his criminality. On the contrary, charging the forgery of 16 checks and four indorsements in two specifications was a fair and reasonable exercise of prosecutorial discretion.
In this case, charging the forged indorsements in a separate specification did not implicate the fourth Quiroz criterion concerning increased punitive exposure. The military judge held that the two specifications were multiplicious for sentencing purposes and adjusted the maximum punishment accordingly.8 See United States v. McKinley, 27 M.J. 78, 80 (C.M.A. 1988) (treating military judge’s instructions as law of the case).
Finally,
nothing in the record suggests prosecutorial abuse, the fifth Quiroz
criterion. This was not a case of
“unreasonable multiplication of charges by creative drafting.” United States v. Morrison, 41 M.J.
482, 484 n.2 (C.A.A.F. 1995).
Rather, this was a case of appropriately
charging Appellant’s overly-creative criminal activity.
III.
CONCLUSION
The
decision of the United States Army
Court of Criminal Appeals is affirmed.
1 United
States v. Pauling, No. 9700685, slip
op. (A. Ct.
Crim. App. July 15, 1999) (per curiam) (mem.).
I.
WHETHER THE
II. WHETHER THE
3 The checks were drawn on
a credit union. At one time, arcane
distinctions existed between a “share draft” drawn on a credit union
and a
“check.” See United States v.
Eatmon, 47 M.J. 534, 536 n.2 (A.F. Ct. Crim. App. 1997), aff’d,
49
M.J. 273 (C.A.A.F. 1998). However, the
law of negotiable instruments now includes share drafts within the
definition
of checks. See U.C.C. § 3-104
cmt. 4 (amended 2002).
4 Under
Article 123, forgery occurs where a person falsely makes a signature
under
circumstances where the forged signature, if it were genuine,
would
apparently impose a legal liability on another.
“In military law, as in
the civilian criminal law, actual legal liability
of
the person whose signature is forged to a document is not
required;
all that is necessary is that legal liability would ‘apparently’ result
if the
signature were genuine.” United States v. Uhlman, 1 M.J. 419, 421 (C.M.A.
1976)
(Cook, J., dissenting).
5 See, e.g.,
Brown
v. State, 7 So.2d 28, 28 (
6 See
Col. Rev. Stat. Ann. §
4-3-415 (West Supp. 2003). This statute
is a virtually verbatim duplicate of the official Uniform Commercial
Code’s
text. See
U.C.C. § 3-415 (1993).
7 In this
case, we need not and do not address the multiplicity implications of
signing a
fictitious name as the indorser on a check bearing a forged drawer’s
signature.
8 While not within the
scope of the issues before us, we note that the military judge did not
deliver,
nor did the defense request, an instruction that the forgery of the
four
indorsements merged with the forgery of the relevant checks for
sentencing
purposes. See
ERDMANN, Judge (concurring in part and dissenting in part):
I
concur with the
majority that the forgery specifications are not multiplicious for
findings. Under the test established in Blockburger
v. United States, 284 U.S. 299 (1932) and adopted by this Court in United
States v. Teters, 37 M.J. 370 (C.M.A. 1993), the forgery of the
payor’s
signature on the front of a check is a distinct offense from the
forgery of the
indorser’s signature on the back of that same check and the offenses
are not
facially duplicative. See
FACTS
Pauling was charged with forging 16 checks
belonging to Little Joe Sandoval. He
made 12 of the checks payable to himself and four of the checks payable
to his
wife. As Pauling explained, he did so to
avoid having “so many in [his own] name.”
On those four checks, he forged Mrs. Pauling’s signature on the
back of
each check as the indorser. He cashed
all of the checks, cumulatively worth approximately $5,000, on 16
separate
occasions at two financial institutions over a month’s time.
Pauling was also charged with two
specifications of larceny, one alleging larceny of $1,675 from the Army
National Bank,
Defense counsel moved to dismiss Specification
1 of the forgery charge (forgery of Mrs. Pauling’s signature as
indorser four
times), asserting that Specification 1 was multiplicious with
Specification 2
(forging the front side of all 16 checks). Defense counsel did not
specifically
move to dismiss specification 1 on the basis of unreasonable
multiplication of
charges but did mention the “multiplication of charges” in making the
motion to
dismiss.
During
argument on the multiplicity motion defense counsel also
asserted that Charge II (larceny) was multiplicious for sentencing. The military judge ruled that the larceny
specifications were not multiplicious for findings or sentencing with
the
forgery specifications. He also ruled
that the two forgery specifications were not multiplicious for findings
but
that they were multiplicious for sentencing purposes.* Despite making this
determination, the military judge failed to inform the members that the
two
forgery specifications should not be considered separately for
punishment.
DISCUSSION
The concept of unreasonable
multiplication of charges is based on Rule for Courts-Martial 307(c)(4) [R.C.M.]. “What
is substantially one transaction should not be made the basis for an
unreasonable multiplication of charges against one person.” R.C.M. 307(c)(4)
discussion. To determine whether a
military judge or Court of Criminal Appeals has abused its discretion
and
affirmed an unreasonable multiplication of charges, we apply a
five-part
test:
(1)
Did the accused
object at trial that there
was an unreasonable multiplication of charges and/or specifications?
(2)
Is each charge and
specification aimed at
distinctly separate criminal acts?
(3)
Does the number of
charges and specifications
misrepresent or exaggerate the appellant's criminality?
(4)
Does the number of
charges and
specifications unreasonably increase the appellant's punitive exposure?
(5)
Is there any evidence
of prosecutorial
overreaching or abuse in the drafting of the charges?
For
each check upon which Pauling made his wife the payee, he faced triple
conviction and punishment: five years
for forging the front of the check, five years for forging the
indorsement on
the back, and a larceny conviction that included another five years of
potential confinement. For Pauling’s
scheme to forge and cash the 16 checks he was charged with four
felonies and
exposed to 110 years of confinement.
In
my view, this three-fold multiplication of Pauling’s punitive exposure
exaggerated his criminality, unreasonably increased his punitive
exposure, and
constituted overreaching in the charging process. Under
the circumstances of this case,
charging forgery twice, once for the maker and once for the indorser,
constitutes piling-on.
I
would set aside the finding of guilty of Specification 1 of Charge III,
and
affirm the remaining findings of guilty and the sentence.
Judge BAKER (dissenting):
I respectfully dissent for the
following reasons.
Multiplication of
Charges
Like Judge Erdmann, I would decide
this case on the ground that Appellant was subjected to an unreasonable
multiplication of charges. Appellant
stole 16 checks from Sandoval and
forged Sandoval's name as the drawer on all 16 checks.
He made himself the payee on 12 of the checks and made his
estranged
wife the payee on four of the checks. On
those checks that designated his wife as the payee, Appellant signed
his wife’s
name on the back of the checks and then cashed the checks.
Appellant’s wife was not aware of his
fraudulent acts.
The
only thing creative about this case was the Government’s charging
scheme. With respect to the four checks
for which
Appellant made his wife the payee and forged her signature as the
indorser, the
Government charged Appellant with “double forgery,” forgeries for the
front of
the checks and separate forgeries for the back of the checks. As a result, Appellant was potentially exposed
to an additional 20 years of confinement for a total of 115 years of
confinement. I believe 95 years exposure
addressed Appellant’s wrongdoing in stealing and forging 16 checks in
the
amount of $5,075. Although the military
judge considered the four “double forgeries” multiplicious for
sentencing
purposes, the Government’s charging scheme nonetheless exaggerated the
criminality at issue.
Double Forgery
My
view on the unreasonable multiplication of charges is reinforced by my
skepticism that this is the case on which to substantiate a theory of
“double
forgery.” I am not persuaded Appellant
committed a separate offense under the Uniform Code of Military Justice
when he
signed his wife’s name as the indorser on four checks upon which he had
already
forged the drawer’s signature.
The elements of forgery under Article
123, UCMJ,
10 U.S.C. § 923 (1994) are:
(a)
that the accused falsely made or
altered a
certain signature or writing;
(b)
that the signature or writing was
of a
nature which would, if genuine, apparently impose a legal liability on
another
or change another’s legal rights or liabilities to that person’s
prejudice; and
(c)
that the false
making or altering was with the intent to defraud.
The majority has premised its
conclusion on the notion that Mrs. Pauling incurred an apparent legal
liability
because “under the law of the jurisdiction where the checks
were
negotiated, the indorser is obligated to pay a check’s face amount in
the event
of dishonor.” ___ M.J. ___ Further, according
to the majority, “[t]he risk that such an obligation will arise is
particularly
high where a check bears a forged drafter’s signature, thus providing a
basis
for its dishonor.”
A.
Mrs. Pauling’s forged signature
As the lead opinion notes, the
Colorado Commercial Code states “. . .if
an instrument is dishonored, an indorser is obliged to pay the amount
due on the
instrument. . . according to the terms of the instrument at the time it
was
indorsed.” C.R.S.
§ 4-3-415. However, this
provision must be read in light of the Colorado Code’s treatment of
unauthorized signatures. Under the
Colorado Code, an indorsement means “a signature, other than that of
the
signer, drawer, or acceptor, that. . . is
made on an
instrument for the purpose of (i) negotiating the instrument, (ii)
restricting
payment of the instrument, or (iii) incurring indorser’s liability on
the
instrument.” C.R.S. §
4-3-204. Under the section
entitled “Signature,” the following is found: “A person is not
liable on
an instrument unless. . . the person signed
the
instrument.”
C.R.S.
§ 4-3-401. The comment to this
section states: “Obligation on an instrument depends on a signature
that is
binding on the obligor.” And
“[s]ignature includes indorsement.”
C.R.S. § 4-3-401 Comment. Furthermore,
§ 4-3-403 states that “[u]nless otherwise provided in this
article or
article 4 of this title, an unauthorized signature is ineffective except as the
signature of the unauthorized signer in favor of a person who in
good faith
pays the instrument or takes it for value.”
C.R.S. § 4-3-403.
An unauthorized signature is defined in §
4-1-201 as including a forgery. In
essence, a
forgery is effective only as the signature of the forger.
In
this case,
assuming as the majority does, that the reason for dishonor would be
discovery
of the forgery, Mrs. Pauling would not have been considered an indorser
because
her signature was unauthorized. Thus,
the Colorado Code imposed no liability on her under § 4-3-415, apparent
or
otherwise, in the event of dishonor.
B.
If Mrs. Pauling’s signature were genuine
Even if Mrs. Pauling’s signature were
genuine, it would not have exposed her to an apparent legal liability
or
changed her legal rights or liability to her prejudice.
See Article 123, UCMJ. Under
the Colorado Code and its uniform
counterpart, there are several possible scenarios that might arise
relevant to
Mrs. Pauling’s apparent liability if her indorsement was considered
genuine on
a check that otherwise contained the forged signature of the drawer.
(1) Assume for the moment that Mrs.
Pauling was a good faith holder and genuine indorser of a check with a
forged
drawer signature. Further, assume she
deposited the check in her bank and Sandoval’s bank (drawee bank)
subsequently
paid the check. Under § 4-3-418 of the
Colorado Code, if the drawee bank mistakenly paid the check over the
forged
signature of the drawer, the drawee bank could possibly seek to recover
the
amount paid on an equitable theory of unjust enrichment.
However, this would only be true as long as
the wife had not changed her position in reliance on the payment. C.R.S § 4-3-418(c). Under paragraph 48(c)(4)
of the Manual for Courts-Martial regarding apparent legal efficacy,
“the
writing must appear either on its face or from extrinsic facts to
impose a legal
liability on another.” So, while in
theory the drawee bank could seek a remedy “in equity,” this is
certainly not apparent
on the face of the writing. It seems
clear that in such a case, the Colorado Code affords the drawee bank no
remedy
“at law” stemming from any legal liability on the part of Mrs. Pauling. Moreover, the record in this case suggests
the actual facts are even different from the hypothetical just posed. Here, after signing his wife’s name,
Appellant actually cashed the checks and received payment.
Therefore, no party could even recover in
restitution from Mrs. Pauling because she never received the benefit of
the
fraudulent payments.
(2) Mrs. Pauling could potentially
incur liability if her failure to exercise “ordinary care”
“substantially
contribute[d]” to the making of the forged signature.
C.R.S 4-3-406 comment 4;
James J. White & Robert S. Summers, Uniform Commercial Code §
16-3(b) (5th
ed. 2000). Again, it is not
apparent on the face of the writings, nor, is there any indication in
the
record to suggest that Mrs. Pauling knew of, had reason to know of, or
was complicit
in the fraudulent acts of Appellant.
One thing is clear, under the Uniform
Commercial Code (UCC) and Colorado law, the relationships and
responsibilities
of payees, drawers, indorsers and holders, are sufficiently complex
that in a
case like Mrs. Pauling’s, whatever legal liability might arise with
respect to
a genuine signature would not be apparent from her genuine indorsement
on a
forged instrument.
If apparent means “manifest” or “palpable” it is not clear to me that the UCC, as adopted in Colorado state law, guides one to a manifest conclusion regarding the wife’s liability if her signature was assumed genuine. Nor does it “seem” that Mrs. Pauling would be liable--quite the contrary. Therefore, while the wife is clearly a “victim” of her estranged husband’s conduct in a natural law sense, I do not believe it is apparent that she would have incurred any legal liability in this case.* Accordingly, on the basis of an unreasonable multiplication of charges and failure to state an offense on the facts of this case, I would dismiss the specification that alleges separate forgeries for the four checks bearing the wife’s unauthorized signature.
* This conclusion is fact
specific. I am not suggesting a forged
indorsement can never serve as the basis for a forgery charge.