People v. Maheshwari

Opinion

COFFEE, J. Appellant Santosh Kumar Maheshwari embezzled over $300,000 from G.T. Tire and Wheel Company, Inc. The owner filed a civil action against appellant and prevailed. A criminal prosecution followed and appellant was convicted, sentenced to state prison and ordered to pay direct victim restitution. The restitution order included $166,751.52 in attorney fees and private investigator’s fees incurred by the owner in the civil action. Appellant argues that the fees were not properly the subject of a restitution order. We disagree and affirm.

[1408]Facts

Gary Toussanian owned G.T. Tire and Wheel Company, Inc., and had employed appellant as his bookkeeper for 15 years. Eight years into their business relationship, appellant began embezzling funds. During the next seven years he embezzled over $300,000 from Toussanian and also filed false personal tax returns.

When Toussanian discovered the extent of his loss, he filed a conversion action against appellant and prevailed. According to the probation report, he received a judgment of approximately $600,000.1 The judgment included $41,751.52 in private investigator’s fees. Although he had also incurred $125,000 in attorney fees pursuant to a contingency agreement with his counsel, those fees were not recoverable in the civil action. Toussanian has been unable to collect any part of the judgment.

A criminal action was subsequently instituted against appellant. He waived his right to jury trial, entered a guilty plea to one count of grand theft of personal property (Pen. Code, § 487, subd. (a))2 and admitted the allegation that the value of the property taken exceeded $150,000. (§ 12022.6, subd. (a)(2).) He also pleaded guilty to three counts of filing a false tax return. (Rev. & Tax. Code, § 19705, subd. (a)(1).) The trial court imposed a sentence of four years and eight months in state prison.

Appellant was ordered to pay direct victim restitution of $694,185.66. The fines included payment of $496,271.31 to Toussanian; $12,339 for insufficient fund charges; $18,823.83 to the Franchise Tax Board; $41,751.52 for private investigative services; and $125,000 in attorney fees. Appellant was given credit for $38,000 already paid.

Prior to the court’s imposition of sentence, defense counsel argued that the order of restitution should not include the $41,751.52 in private investigator fees and $125,000 in attorney fees. Counsel from the civil case was present at the sentencing hearing and stated that his 25 percent contingency fee agreement was reasonable. The trial court concluded that the costs of investigation and payment of attorney fees were permitted under the restitution statute (§ 1202.4) and the civil investigation “formed the basis” for the criminal investigation. The court ordered that any payments made to