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State v. Carey

Court of Criminal Appeals of Tennessee, Knoxville

August 9, 2017


          Session March 21, 2017

         Appeal from the Criminal Court for McMinn County No. 14-CR-36 Sandra Donaghy, Judge.

         Defendant, Roy Allen Carey, was convicted of hindering a secured creditor. He received an alternative sentence of two years' probation after serving ten days in incarceration. On appeal, he argues that (1) the evidence was insufficient to support his conviction; (2) the amended indictment was void; (3) the bill of particulars was insufficient; (4) the trial court committed error by not providing the requested jury instructions; and (5) the lack of notice as to the prohibited conduct violated his due process rights. After review, we find that the evidence was insufficient to support a conviction for hindering a secured creditor and that the trial court erred by not providing a jury instruction on the creation of a security interest. The judgment of the trial court is reversed and vacated.

         Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Criminal Court Reversed and Vacated.

          Andrew S. Cunnyngham, Chattanooga, Tennessee, for the appellant, Roy Allen Carey.

          Herbert H. Slatery III, Attorney General and Reporter; Courtney N. Orr Assistant Attorney General; Stephen D. Crump, District Attorney General; and Joseph V. Hoffer, Assistant District Attorney General, for the appellee, State of Tennessee.

          Timothy L. Easter, J., delivered the opinion of the court, in which John Everett Williams and J. Ross Dyer, JJ., joined.



         Factual and Procedural Background

         This matter invites this panel of the Criminal Court of Appeals to wander into an exercise that has the scent of a civil law maneuver. Defendant was employed by George Thomas, the owner of Cedar Grove Industries LLC ("Cedar Grove") in Decatur, Tennessee. During Defendant's employment at Cedar Grove, Mr. Thomas had a discussion with Defendant about loaning some money to Defendant for the purpose of obtaining reliable transportation to and from work. Mr. Thomas found a vehicle on Craigslist, called about the vehicle, and went to look at the vehicle with Defendant on June 6, 2013. The vehicle, a 2002 Honda Odyssey, was purchased for $2500. At the dealership, Mr. Thomas and Defendant dealt with a salesperson named Anthony Osborne. Mr. Thomas was listed as the lienholder on the Bill of Sale, a document titled Tennessee Department of Vehicle Services Division Multi-Purpose Application, and a document titled Statement of Title Held By Lienholder, Security Interest Holder or Leasing Company. All of those documents were signed by Defendant, but Defendant indicated on cross-examination that he did not understand that Mr. Thomas would have a lien on the vehicle at the time he signed those documents.

         According to Mr. Thomas's testimony, he and Defendant executed a promissory note pertaining to the loan to purchase the Honda Odyssey on June 7, 2013. The promissory note for $2800 was dated June 6, 2013, and signed by Defendant and Mr. Thomas. The signatures were witnessed by Sandra Hood. Mr. Thomas testified that the total amount of the promissory note was $2800 because it encompassed both the $2500 loan to obtain the vehicle and $300 in outstanding debt that Defendant owed Mr. Thomas. The loan was to be repaid to Mr. Thomas via payroll deductions of $100 per month. The promissory note stated that the "Note" was secured by a 2002 Honda Odyssey and listed a VIN number. The promissory note further stated that if Defendant defaulted, the Honda Odyssey "will be immediately provided to George Thomas and George Thomas is granted all rights of repossession as a secured party, and may immediately take possession of Security without recourse." It also contained a provision which required Defendant to "maintain in good standing at all times until note is paid in full, full comprehensive insurance on said vehicle with George Thomas listed as Loss Payee." With regard to the title of the Honda Odyssey, the promissory note provided that "George Thomas will be listed as a lender on the title of the Security whether or not George Thomas elects to perfect his security interest in the Security." Additionally, it provided that Defendant "grants to George Thomas a Security interest in the Security until this Note is paid in full." Mr. Thomas testified that it was his understanding that Defendant "would register the car with [Mr. Thomas] as lienholder and also carry full insurance on the car until the note was paid in full."

         On July 18, 2013, Defendant executed a Title Pledge Agreement and Disclosure/Receipt with Tennessee Title Loans, Inc. Defendant received a loan of $2000, and the "Item Pledged" was the 2002 Honda Odyssey purchased on June 6, 2013. At the time that Defendant went to Tennessee Title Loans, Inc., he had an "open title" to the vehicle because the vehicle had not been registered to Defendant. In order to get a loan from Tennessee Title Loans, Inc., he registered the vehicle at the Meigs County Clerk's Office.

         Janie Meyers, the Meigs County Clerk, testified that her office examined each title to determine if there was a lienholder on a particular vehicle. She indicated that if there was no lienholder information on the title, then it would be safe to assume that there was not a lien on the vehicle. There were two Official Vehicle Registration forms signed by Defendant on July 19, 2013. One did not indicate a lienholder; the second listed Tennessee Title Loans, Inc., as the first lienholder on the 2002 Honda Odyssey. Ms. Meyers did not explain precisely why there were two forms, but she said that it might be due to Defendant indicating that there was a lien after the form was filled out or the Clerk's Office discovering an unmentioned lien. She explained that the back of the title lists the transfers of the vehicle, and when the back is full, as was the case for the title to the 2002 Honda Odyssey, an Extension of Title form is used to document further transfers of title. She indicated that the title to the vehicle and the extension were all that Defendant would need to register his vehicle. Ms. Meyers further testified that the only way to properly encumber a vehicle in Meigs County would be to register it with the County Clerk's Office. After Defendant registered the vehicle with the Meigs County Clerk's Office, the title to the vehicle was mailed directly from the State of Tennessee to Tennessee Title Loans, Inc. This title listed Tennessee Title Loans, Inc., as the first lienholder on the vehicle.

         With regard to the promissory note between Defendant and Mr. Thomas, Defendant testified that he actually signed it on August 22, 2013, and that Ms. Hood witnessed it on the same day. After Defendant signed the promissory note, Mr. Thomas handed the Defendant a demand letter for the vehicle and a letter of termination. Misty Carey, Defendant's wife, testified that Defendant had no paperwork with him when he entered Mr. Thomas's house on the day that the vehicle was seized by Mr. Thomas. However, when he exited the house he had a promissory note and a letter of termination.

         Sandra Hood, the person who witnessed the signatures on the promissory note, testified that the promissory note was signed on the same day as Defendant's termination from Cedar Grove. However, Ms. Hood also testified that she did not think that she witnessed the promissory note on the same day that Defendant's vehicle was taken away. She was unable to specifically testify that the promissory note was signed on June 6, 2013, but remembered that is was a Friday because "it was a payday." When asked to verify or confirm that June 6, 2013, was the day that Ms. Hood witnessed the promissory note, she responded, "I would think it would be that date, because that's the day I signed it." When further questioned if she would have corrected the date if it were wrong, Ms. Hood said, "Yes, I think I would have." The demand letter from Mr. Thomas to Defendant states that the Promissory Note was signed on June 6, 2013.

         Mr. Thomas terminated Defendant because he "became aware of the fact that [Defendant] did not follow through with securing me as lienholder on the vehicle." Mr. Thomas discovered that he was not listed as a lienholder on the vehicle when he called the courthouse in Decatur, Tennessee, to determine what steps were necessary to repossess the 2002 Honda Odyssey. At that time, he was informed that he did not have a lien on the vehicle. That same day, Mr. Thomas provided Defendant with a demand letter which stated that Defendant was in default according to the terms of the promissory note, that the insurance coverage on the 2002 Honda Odyssey had lapsed, and that Mr. Thomas demanded that Defendant "relinquish this vehicle to me immediately upon receipt of this notice until the terms of the Note are met." Defendant testified at trial that AllState had told him that "your insurance is still good until September 8th, because when you opened the policy you paid for two months." However, a document from AllState that was entered into evidence shows the termination date of the policy to be August 8, 2013.

         Mr. Thomas decided to repossess the 2002 Honda Odyssey and return the vehicle to the dealership from which it was purchased. According to Mr. Thomas, he demanded Defendant return the vehicle, the Defendant voluntarily returned it to him, and Mr. Thomas took the vehicle back to the dealership. According to the Defendant, the vehicle was repossessed when Mr. Thomas told him, "Get your shit out of that van. Get your family out of that van. I'm taking it now, " and Mr. Thomas's brother parked a tractor behind the vehicle. After Mr. Thomas repossessed the vehicle, he received no further payments from Defendant. Mr. Thomas tried to obtain title on the 2002 Honda Odyssey, but he was denied title because Tennessee Title Loan, Inc., held a lien on the vehicle. Mr. Thomas testified that he had not given Defendant permission to obtain another lien on the vehicle.

         At some point, Mr. Thomas spoke with Janie Meyers at the Meigs County Clerk's Office, and he spoke to the dealership from which the automobile came. Mr. Thomas testified, "I had lost my security interests, and I decided in working with the dealer that the best thing to do was to return the car to them, because . . . we thought at that time that it was a mistake that they made that caused the problem." After repossessing the vehicle, Mr. Thomas took the vehicle back to the dealership. He testified that he had an "agreement" with the dealership whereby they would "reimburse" him from the money that they received for the vehicle, but he was never reimbursed. Shawn Allen, the Area Manager for Tennessee Title Loans, Inc., was also in contact with the dealership that had possession of the vehicle in his attempt to recover the vehicle as collateral for the loan from Tennessee Title Loans, Inc. Melissa Williams, the proprietor of Wholesale Auto Group, would not relinquish the vehicle to Tennessee Title Loans, Inc., because she claimed that she was supposed to be the lienholder. Eventually, Mr. Allen and Ms. Williams reached an agreement to sell the vehicle and split the proceeds.

         Defendant was originally indicted for fraudulent transfer of a motor vehicle, but the indictment was amended by an agreed order to change the charge to hindering a secured creditor. Defendant moved for a bill of particulars, and the State filed a bill of particulars further describing the charge against Defendant.

         Prior to trial and at the close of proof, Defendant requested jury instructions regarding the formation of a contract and applicable defenses as well as the creation of an enforceable security interest. The State "vehemently" objected to "any kind of civil jury instruction." The trial court denied Defendant's requests. Before closing arguments, the trial court instructed the jury about security interests by saying, "Security interest means an interest in personal property of [sic] fixtures that secures payment or performance of an obligation. Lien means a charge or ...

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