Monday, February 19, 2007

CA: the People have the burden of establishing both the amount of loss and any offsets at restitution hearing

People v Tzitzikalakis, 2007 NY Slip Op 01335 [available here]

Defendant in Tzitzikalakis ran a contracting company that ripped off the city of New York by performing construction work and submitting inflated invoices. Defendant was convicted of grand larceny, and ordered to pay restitution to the city. At the restitution hearing, the hearing court required the People to establish only the face amount of some of the phony invoices paid, leaving it to the defendant to put in proof on any offsets (i.e. the value of the work defendant actually completed under the contract). From the majority opinion:

At a restitution hearing, the People bear the burden of proving the victim's out-of-pocket loss--the amount necessary to make the victim whole--by a preponderance of the evidence. To meet that burden, the People must show both components of the restitution equation, the amount taken minus the benefit conferred. To hold otherwise would contravene both the words and the intent of the statute, "to prevent the victim from enjoying an unjust enrichment, and the defendant from suffering under an unduly harsh and unreasonable restitution order."

(Tzitzikalakis, 2007 NY Slip Op 01335.)

The Court called on the legislature to modify the restitution statute to give "hearing courts the discretion to place the burden of proving assets on the party best suited to do so [...]." (Id.)

Justice Smith dissented. While agreeing that the People had "the initial burden of producing evidence and the burden of persuasion . . . on the issue to be decided at the hearing, the amount of the out-of-pocket loss", Justice Smith argued that once the People established a prima facie loss it was incumbent on the defendant to bear the burden of producing evidence on any offsets. (Id, SMITH, J., dissenting.)

This case also saw the battle of the evidence treatises--the majority cite to Richardson in support of its holding, with the dissent calling in Fisch.