Sureties issuing bail bonds in the State of Arizona should be aware of a new case issued by the Arizona Court of Appeals (Division Two): State v. Int’l Fid. Ins. Co., No. 2 CA-CV 2014-0157 (Aug. 28, 2015). The case provides sureties with a list of factors that Arizona courts should consider when deciding whether to exonerate a bail bond. Also, the case holds that the State has the burden of demonstrating that it incurred costs “as a result of the defendant’s violation” in order to recover under a bail bond.
The basic facts of the case are as follows: In March 2012, Augustin Rivera (“Rivera”) was arrested and charged with multiple felonies. Following his arrest, Rivera was released from custody in June 2012 after Regulator Bail Bonds (“Regulator”) posted a $100,000 appearance bond issued by International Fidelity Insurance Company (“Surety”). Rivera’s mother (“M.V.”) and his former girlfriend and the mother of his children (“E.G.”) became indemnitors on the bond. The appearance bond provided:
If the defendant has a pending criminal charge, this bond secures attendance at future court dates. Should the defendant fail to appear at any future court date for this charge, the bond may be forfeited.
In September 2012, Rivera and his co-defendant, Rosario Soto (“Soto”) failed to appear for the pretrial hearing, causing the court to proceed with trial in absentia. Neither man appeared at trial, and following the jury’s guilty verdicts, the court ordered that a bench warrant issue for Rivera and that forfeiture proceedings commence. Rivera surrendered on October 31 following a standoff with twenty to thirty officers. Rivera was remanded to the Pima County jail on November 6, 2013, and on December 2, the court found that the State had proven Rivera’s prior conviction. The trial court sentenced Rivera to a prison term exceeding thirty-one years on January 16, 2014. Thereafter, counsel for the State sent an e-mail to Surety’s counsel providing evidence of jail and medical costs incurred by Rivera and Soto after their surrender. The State claimed total jail costs for Rivera in the amount of $7,039.12 based on “a per diem rate multiplied by the 84 days of Rivera’s incarceration from November 6, 2013 through his sentencing on January 16, 2014, and his eventual release to the Arizona Department of Corrections on January 29, 2014. The medical bills were for Soto only and totaled approximately $80,000.
At the bond forfeiture hearing, Surety introduced evidence that its fugitive-recovery agent, Marvin Bordeaux, had spent hundreds of hours looking for Soto and Rivera with the cooperation of the indemnitors and the U.S. Marshall’s office. Ultimately, a U.S. Marshall based in New Mexico located Rivera in Hurley, New Mexico. Following the hearing, the trial court stated that it found no legally recognizable reason for Rivera’s failure to appear, but further observed that Bordeaux had made substantial efforts to secure Rivera’s appearance at a cost of $2,400 or $2,500. The trial court decided to exonerate the bond by $5,000 – essentially doubling Bordeaux’s out of pocket costs – and entered a formal order forfeiting $95,000 of the $100,000 bond. The Surety appealed the trial court’s forfeiture order.
Under Rule 7.6 (c), Ariz. R. Crim. P., a trial court has discretion to forfeit “all or part of the amount of [a surety] bond” when a criminal defendant “has violated a condition of [the] bond” and the violation “is not explained or excused.” “[E]ven when a defendant’s actions are not excusable, a trial court [nonetheless] has the discretion to determine whether to exonerate all or part of the bond” (citations omitted). Arizona courts enumerated several facts “that might bear on the court’s discretionary decision whether, and in what amount, to forfeit an appearance bond.” State v. Old W. Bonding Co., 203 Ariz. 468, ¶26, 56 P.3d 42, 49 (Ct. App. 2002). Those factors include:
(1) whether the defendant’s failure to appear due to incarceration arose from a crime committed before or after being released on bond; (2) the willfulness of the defendant’s violation of the appearance bond; (3) the surety’s effort and expense in locating and apprehending the defendant; (4) the costs, inconvenience, and prejudice suffered by the state as a result of the violation; (5) any intangible costs; (6) the public’s interest in ensuring a defendant’s appearance; and (7) any other mitigating or aggravating factors.
Id. However, a trial court must exercise its discretion reasonably and in furtherance of governing law.
On appeal, Surety argued that the trial court abused its discretion in calculating the $5,000 exoneration and by failing to consider the efforts of the fugitive-recovery agent and indemnitors and other relevant factors. Surety pointed out that the trial court, despite crediting the Surety’s fugitive-recovery agent’s testimony, simply disregarded the Surety’s efforts to apprehend Rivera. Moreover, Surety asserted that the trial court simply overlooked the following factors: that “the State suffered absolutely no ‘cost, inconvenience or prejudice’ whatsoever by Rivera’s absconding, capture and return” because those costs were borne by New Mexico local authorities and the U.S. Marshall’s Service; the costs claimed by the State were only “a few grand” for “additional time/costs in the Pima County jail;” the efforts by Bordeaux and the indemnitors to protect the public by locating Rivera; and the hardship to the indemnitors given the forfeiture of ninety-five percent of the bond.
Although the Court of Appeals found that the trial court had the discretion to forfeit all or part of the bond under Rule 7.6(c), the Court of Appeals nonetheless concluded that the trial court abused its discretion by not exercising its discretion reasonably. The Court of Appeals recognized that a trial court may consider evidence of “the costs, inconvenience, and prejudice suffered by the State,” however, it emphasized that such costs must be “as a result of the violation” (emphasis in original). In overturning the trial court’s forfeiture order and remanding the case back to the trial court for further proceedings, the Court of Appeals concluded that “there is no basis for finding the jail cost an additional expense incurred as a result of Rivera’s violation.” Rather, the State would have incurred the costs of jailing Rivera following his conviction regardless of his nonappearance.
This case decision offers sureties issuing bail bonds in the State of Arizona several important “take-aways.” First, sureties, their agents, and any outside fugitive-recovery services they employ need to be proactive in apprehending the defendant whose appearance the bond secures. Moreover, these parties should painstakingly document their efforts to apprehend the defendant and likewise record all costs related to their efforts. Maintaining meticulous records of this nature will ensure the surety has compelling evidence demonstrating the surety’s efforts and expense associated with locating and apprehending the defendant – critical evidence relevant to the third factor discussed above. Finally, the surety should always scrutinize the State’s claimed damages and ensure that the State incurred the alleged costs “as a result of the [defendant’s] violation.” The surety has a viable defense to the State’s claim if the surety can demonstrate that the State would have otherwise incurred the expense absent the violation.