Karen Blanks contracted with Grady N. Greene to repair her home after it was damaged by Hurricane Katrina. Greene represented himself as a licensed contractor in Louisiana doing business as Grady Greene Construction, LLC. Greene represented he was licensed as a home improvement contractor, but he was not. Blanks made an initial payment of $25,200.00 to Greene. Little work was performed. Blanks discharged Greene, terminated the contract and demanded to be repaid the outstanding deposit balance within 24 hours. Two weeks later, Blanks filed a formal complaint with the Economic Crimes Department of the Orleans Parish District Attorney’s Office.
Greene acknowledged he owed Blanks the deposit less $4,800.00 for work already performed, and submitted a written proposal offering to pay Blanks $20,000.00 at the rate of $5,000.00 per month. Blanks rejected the proposal. Greene was arrested and charged with theft. At trial, Greene conceded that even after Blanks had fired him, he continued to draw $1,500.00 a week against the deposit as his own salary for two months. He also testified he was working on another project at the time, used funds from Blanks’ deposit for the other project, and contended the matter was a good faith civil dispute. The trial court rejected the defense and found Greene guilty of the lesser offense of unauthorized use of a movable. Greene was sentenced to five years imprisonment at hard labor, the maximum term for the offense. The court of appeal reversed. A majority found the evidence failed to exclude the reasonable possibility that Greene and Blanks had a legitimate business dispute as to how to proceed, but acknowledged Greene’s actions of applying funds advanced by Blanks to another job or drawing on the money to pay himself, viewed in the light most favorable to the State, could constitute evidence of fraudulent and/or criminal conduct.
The unauthorized use of a movable is the intentional taking or use of a movable which belongs to another, either without the other’s consent, or by means of fraudulent conduct, practices or representations, but without any intention to deprive the other of the movable permanently. It is a lesser and included offense of theft. Money is a corporeal movable, capable of being taken or used in an unauthorized manner.
The Supreme Court found the evidence at trial left no question Greene misrepresented himself at the outset of his relationship with Blanks by holding himself out as a licensed contractor in Louisiana when, in fact, he was not licensed as a home improvement contractor and never applied for a license. Louisiana law prohibited Greene from entering into the contract in the first place. It provides that no person shall undertake, offer to undertake, or agree to perform home improvement contracting services unless registered with and approved by the Residential Building Contractors’ Subcommittee of the State Licensing Board for Contractors as a home improvement contractor. Greene was also precluded from operating without a certificate of registration issued by the subcommittee, and from making any material misrepresentation in the procurement of the contract, or making any false promise likely to influence, persuade, or induce the procurement of the contract, or making a false representation that he was a state licensed general contractor.
The Supreme Court, given Greene’s initial representations to Blanks, did not address his claim industry practice did not preclude him from co-mingling funds from several ongoing projects in a single bank account, thereby permitting him to use funds from one project on another project with or without the knowledge or consent of the owners. The court noted similar claims had been made in other cases in other jurisdictions against the argument the cash flow realities of the construction business frequently mandate that a contractor engaged in numerous projects use funds advanced for one job to pay subcontractors or suppliers on another, it being common practice for a contractor to use incoming funds to discharge his most pressing obligations and replace them later with the proceeds of other jobs. Further, the jurisprudence has distinguished between a contractor’s conversion to his own use of unrestricted advance payments, and the conversion of an advanced payment earmarked for a specific construction purpose.
The court held, whatever the common practice in the industry, it could not include misrepresentations with regard to state licensing requirements. On the evidence presented at trial, any rational trier of fact could find Greene took the advance payments on the contract from Blanks by fraudulently misrepresenting himself as a licensed general contractor in Louisiana, and, by that act alone, committed the offense of unauthorized use of a movable when he took the deposit. Moreover, nothing that transpired later undercut the inference of fraudulent intent arising from Greene’s initial misrepresentations, and by Greene’s own accounting, he continued to draw on Blanks’ advance money in November and December, depending on what his personal needs were, until he had completely depleted the advance, although he had performed relatively little work. The decision of the court of appeal was reversed and Greene’s conviction and sentence reinstated. State of Louisiana v. Greene, 2009-2723 (La. 1/19/11), 55 So.3d 775.