COURT OF APPEALS OF VIRGINIA<\/p>\n
Present: Judge Bray, Senior Judges Duff and Overton
\nArgued at Alexandria, Virginia<\/p>\n
LEWIS A. BROWN, JR.
\n OPINION BY
\nv. Record No. 2964-97-4 JUDGE CHARLES H. DUFF
\n JULY 27, 1999
\nCOMMONWEALTH OF VIRGINIA<\/p>\n
FROM THE CIRCUIT COURT OF WARREN COUNTY
\nDennis L. Hupp, Judge<\/p>\n
Thomas D. Logie for appellant.<\/p>\n
Jeffrey S. Shapiro, Assistant Attorney
\nGeneral (Mark L. Earley, Attorney General, on
\nbrief), for appellee.<\/p>\n
Lewis A. Brown, Jr., appellant, appeals his conviction for
\ngrand larceny by false pretenses in violation of Code ? 18.2-95.
\nHe argues on appeal that the trial court erred in (1) denying
\nhis motion to quash the indictment; and (2) denying his motions
\nto strike the evidence. Finding no error, we affirm the
\nconviction.
\nFACTS
\n With his 1994 state income tax return, appellant, an
\naccountant and owner of Front Royal Bookkeeping (“Front Royal”),
\nsubmitted W-2 forms claiming he was employed by Royal Cinemas
\n(“Royal”) and Tomorrow’s Country Buffet (“Buffet”) in 1994. The
\nW-2 forms indicated that appellant earned $15,500 in income from
\nRoyal and $25,000 in income from Buffet in 1994. The W-2 forms<\/p>\n
– 2 –
\nalso indicated that Royal withheld $2,500 in state income tax
\nfor appellant in 1994, and Buffet withheld $4,500 in state
\nincome tax for appellant in 1994. As a result of these claims,
\nappellant received an additional $7,000 tax refund from the
\nCommonwealth of Virginia. Appellant was indicted for grand
\nlarceny in violation of Code ? 18.2-95.
\n At the trial, Francis Brooks, owner of Royal, a subsidiary
\nof B & B Enterprises (“B & B”), testified that, in 1993, Royal
\nfiled for Chapter 11 bankruptcy and that appellant, Brooks’
\nfriend, offered to help him in any way he could. Brooks said he
\ndid not discuss compensation with appellant but assumed they
\nwould “get to it later.” Appellant was not on Royal’s payroll,
\nand Royal did not receive a bill from appellant or pay appellant
\nor Front Royal for any services. Brooks testified that
\nappellant prepared tax documents and documents required by the
\ncourt for the bankruptcy proceedings.
\n In 1995, appellant attached a W-2 form to his state income
\ntax return indicating he had been paid $15,500 by Royal for his
\nservices in 1994. Brooks testified that Royal did not pay
\nappellant $15,500 in 1994. Brooks first learned of a $15,500
\ndebt allegedly owed appellant when a representative from the
\nVirginia Department of Taxation approached Brooks with questions
\nconcerning appellant’s 1994 W-2 form.<\/p>\n
– 3 –
\n Royal’s 1994 payroll booklet did not list appellant as an
\nemployee of Royal. Royal’s quarterly tax report did not list
\nappellant as an employee. A proof of claim filed in bankruptcy
\ncourt indicated that Royal owed $5,541.50 to Front Royal, not
\nappellant individually.
\n Brooks also testified that, with the exception of a few
\nemployees who were not compensated for their work in the last
\nweek that Royal operated, all of Royal’s employees were paid for
\ntheir work performed in 1994. Brooks also stated that, given
\nthe financial condition of Royal in 1994, Royal could not have
\nafforded to pay someone $15,500 in 1994.
\n Ashrafullah Sayed, manager of Buffet, a\/k\/a Dinis Brothers
\nRestaurant, testified that, after filing for bankruptcy in early
\n1994, Buffet had a financial agreement with Front Royal for
\naccounting services. Buffet paid Front Royal monthly for
\nservices. Buffet had no agreement with appellant personally.
\nFront Royal worked on “tax papers, payrolls, all of those” for
\nBuffet. Front Royal also prepared Buffet’s W-2 forms.
\n Appellant attached a W-2 form to his 1994 state income tax
\nreturn indicating that Buffet paid him $25,000 in income in
\n1994. Sayed testified that Buffet did not pay appellant $25,000
\nin 1994. Buffet’s 1994 W-4 forms, the withholding allowance
\ncertificates for Buffet’s employees, did not include a W-4 form
\nin appellant’s name. Buffet’s 1994 quarterly tax reports did<\/p>\n
– 4 –
\nnot include appellant as an employee for whom state income tax
\nwas withheld. Commonwealth’s Exhibit No. 4 consisted of
\nBuffet’s 1994 W-3 form, entitled “Transmittal of Wage and Tax
\nStatements 1994.” Attached to the form were copies of Buffet’s
\nemployees’ W-2 forms. A W-2 form in appellant’s name indicated
\nthat Buffet had paid appellant $10,000 in 1994, rather than the
\n$25,000 indicated on the W-2 form filed by appellant with his
\n1994 state income tax return. The withholding for state income
\ntaxes on the W-2 form in Buffet’s file was $2,000, rather than
\n$4,500, as indicated on the W-2 form filed by appellant with his
\nstate income tax return.
\n With the exception of several employees who were not paid
\nin the last two weeks that Buffet operated, all of Buffet’s
\nemployees were paid in 1994 before the restaurant closed.
\n Invoices from Front Royal to Buffet for the months of July,
\n1994 through October, 1994 indicated that Buffet owed Front
\nRoyal about $4,000 for accounting services. The invoices did
\nnot indicate that Buffet owed any money to appellant,
\npersonally.
\n John Hawse, an investigator for the Virginia Department of
\nTaxation, testified that independent contractors do not receive
\nW-2 forms from the place at which they perform services. Hawse
\ninterviewed appellant about appellant’s 1994 tax return.
\nInitially, Hawse did not mention anything about appellant’s 1994<\/p>\n
– 5 –
\nW-2 forms. Appellant immediately volunteered that Hawse could
\ncheck with appellant’s employers if he thought the W-2 forms
\nwere “bogus.” Appellant also told Hawse that he had worked as a
\nconsultant for B & B (or Royal) and Buffet and that B & B should
\nhave received an invoice from appellant for $15,500 in 1994.
\n Hawse also testified that appellant said he “had not been
\npaid the wages that were reported on the W-2’s and that he
\nreported that in accordance with instructions from an IRS
\nagent.” When questioned further by Hawse, appellant could not
\nrecall the IRS agent’s name, nor could he produce a tax ruling
\nor policy to support his actions.
\n Hawse interviewed appellant again at a later date. Hawse
\nadvised appellant that both Sayed and Brooks had told Hawse that
\nthey did not hire appellant as an employee. Appellant replied
\nthat “they may be right” if they were referring to the fact that
\nthey did not prepare appellant’s W-2 forms. Appellant also told
\nHawse that he thought he had filed a proof of claim with the
\nbankruptcy court in order to protect the $40,500 the two
\ncompanies allegedly owed him, but appellant never produced any
\ndocuments to support this claim.
\n Appellant also gave Hawse conflicting information on
\nwhether he operated on a cash or accrual basis. In addition,
\nthe withholding rate for state income taxes on appellant’s filed<\/p>\n
– 6 –
\nW-2 forms was about 15% to 18%. Hawse testified that the
\nhighest applicable withholding rate in Virginia is 5.75%.
\n Belinda Lang, office manager for Front Royal, testified
\nthat she typed appellant’s 1994 W-2 forms for Royal and Buffet
\nbased on information she received from the businesses. Lang
\ncould not explain why the W-2 form attached to Buffet’s 1994 W-3
\nTransmittal of Wage and Tax Statements differed from the W-2
\nform attached to appellant’s 1994 tax return. Lang testified
\nthat she “usually” typed the W-2 forms, but that anyone in the
\noffice had access to the forms. Lang stated that she prepared
\nthe 1994 W-2 forms for Buffet’s employees based on payroll
\nrecords provided to her by Buffet, with the exception of
\nappellant’s W-2 form. She prepared appellant’s W-2 form based
\non information provided to her by the owner of Buffet. Lang did
\nnot prepare bills for appellant for any consulting work he may
\nhave personally performed, but she said that both Buffet and
\nRoyal owed Front Royal money.
\n Ray Madaris, a manager with the Virginia Department of
\nTaxation, testified that as a result of appellant including the
\nalleged income and alleged withholding for state income taxes
\nthat he claimed was paid by Royal and Buffet, appellant received
\nan additional state income tax refund of $7,000.
\n Appellant denied that he prepared the W-2 forms in
\nquestion. He testified that he did not know whether the<\/p>\n
– 7 –
\ncompanies actually paid the indicated withholding tax. He
\ndenied that he personally performed bookkeeping services for
\neither Royal or Buffet. Appellant testified that he performed
\n“services as a bankruptcy consultant” for Buffet and that he was
\nan employee of the business. He stated that he assisted Royal
\nwith marketing. Appellant testified that he never received cash
\npayment from either business, but that they partially paid him
\nwith food, gas money, and “entertainment” expenses.
\nANALYSIS
\nI. Motion to Quash the Indictment
\n Appellant argues that the trial court erred in denying his
\nmotion to quash the indictment on the ground that his conduct of
\nallegedly filing a false state income tax return was punishable
\nonly under Code ? 58.1-348, and not Code ? 18.2-95, the grand
\nlarceny statute.
\n Code ? 58.1-348 is entitled “Criminal prosecution for
\nfailure or refusal to file return of income or for making false
\nstatement therein; limitation.” The statute provides, in
\npertinent part:
\n Notwithstanding any other provisions of
\nthis title and in addition to any other
\npenalties provided by law, any individual or
\nfiduciary required under this chapter to
\nmake a return of income, who willfully fails
\nor refuses to make such return, at the time
\nor times required by law, or who, with
\nintent to defraud the Commonwealth, makes
\nany false statement in any such return,
\nshall be guilty of a Class 1 misdemeanor.<\/p>\n
– 8 –
\n(Emphasis added.)<\/p>\n
“Well established ‘principles of
\nstatutory construction require us to
\nascertain and give effect to the legislative
\nintent.'” Legislative intent is to be
\ndetermined by the words in the statute.
\nAbsent ambiguity, “the manifest intent of
\nthe legislature clearly expressed in its
\nenactments should not be judicially thwarted
\nunder the guise of statutory construction.”
\nHerrell v. Commonwealth, 28 Va. App. 579, 584, 507 S.E.2d 633,
\n636 (1998) (citations omitted).
\n In light of these principles, we hold that the language in
\nthe first sentence of Code ? 58.1-348 is not ambiguous. This
\nlanguage clearly provides that the statute is not the exclusive
\navenue for punishment for filing a false state income tax
\nreturn. Further, “[i]t is well established that the choice of
\noffenses for which a criminal defendant will be charged is
\nwithin the discretion of the Commonwealth’s Attorney.”
\nKauffmann v. Commonwealth, 8 Va. App. 400, 410, 382 S.E.2d 279,
\n284 (1989). “[I]t is a matter of prosecutorial election whether
\nthe Commonwealth proceeds under the misdemeanor statute or the
\nfelony statute against an accused . . . .” Mason v.
\nCommonwealth, 217 Va. 321, 323, 228 S.E.2d 683, 684 (1976).
\n“Where the circumstances surrounding an offense permit
\nprosecution under either of two statutes, the selection of the
\nstatute under which to proceed is a matter of prosecutorial<\/p>\n
– 9 –
\nelection.” Smith v. Commonwealth, 17 Va. App. 37, 41, 434
\nS.E.2d 914, 916 (1993).
\n The Commonwealth charged appellant with unlawfully taking
\n$7,000 from it as a result of filing a false state income tax
\nreturn. It was within the Commonwealth’s Attorney’s discretion
\nwhether to prosecute appellant under Code ? 18.2-95, the grand
\nlarceny statute, or to prosecute him under Code ? 58.1-348.
\nAccordingly, appellant’s argument is without merit.
\nII. Sufficiency of the Evidence
\n “On appeal, ‘we review the evidence in the light most
\nfavorable to the Commonwealth, granting to it all reasonable
\ninferences fairly deducible therefrom.'” Archer v.
\nCommonwealth, 26 Va. App. 1, 11, 492 S.E.2d 826, 831 (1997)
\n(citation omitted). “‘[W]hat inferences are to be drawn from
\nproved facts is within the province of the jury and not the
\ncourt so long as the inferences are reasonable and justified.'”
\nHigginbotham v. Commonwealth, 216 Va. 349, 352-53, 218 S.E.2d
\n534, 537 (1975) (citation omitted).
\n “To sustain a conviction of larceny by false pretenses, the
\nCommonwealth must prove: (a) that the accused intended to
\ndefraud; (b) that a fraud actually occurred; (c) that the accused
\nused false pretenses to perpetrate the fraud; and (d) that the
\nfalse pretenses induced the owner to part with his property.”<\/p>\n
– 10 –
\nWynne v. Commonwealth, 18 Va. App. 459, 460, 445 S.E.2d 160, 161
\n(1994) (en banc).
\n The evidence showed that neither Royal nor Buffet considered
\nappellant to be an employee. No tax records, payroll reports, or
\nother paperwork from Royal suggested that appellant was on
\nRoyal’s payroll. In fact, Brooks testified that he never
\ndiscussed a fee arrangement with appellant concerning work
\nappellant performed for Royal.
\n Buffet had no payroll report, W-4 form, or quarterly tax
\nreport indicating that appellant was an employee. Buffet’s
\nrecords contained a copy of a 1994 W-2 form in appellant’s name
\nthat indicated a lower amount of income paid and a lower amount
\nof withholding for state income tax than the W-2 form filed by
\nappellant with his 1994 state income tax return. Sayed testified
\nthat Buffet had an arrangement with Front Royal to pay by the
\nmonth for services, but that it had no such agreement with
\nappellant individually.
\n Both companies were in bankruptcy proceedings when they
\nbegan working with appellant, and both companies were unable to
\npay some of their employees during their last weeks of
\noperations. Furthermore, appellant admitted that he did not
\nreceive the income from Buffet and Royal as indicated on his 1994
\nW-2 forms. Moreover, given the financial status of Buffet, the
\njury could reasonably infer that Buffet did not contract with<\/p>\n
– 11 –
\nappellant for $25,000 worth of accounting services as indicated
\non appellant’s filed 1994 W-2 form. Likewise, given the
\nfinancial status of Royal, the jury could infer that Royal did
\nnot contract with appellant for over $15,000 worth of accounting
\nservices as claimed on appellant’s filed 1994 W-2 form.
\n In addition, Front Royal, appellant’s accounting business,
\nfiled a proof of claim against Royal in the bankruptcy court for
\nonly $5,541 worth of unpaid services, not $15,500. Appellant
\npersonally filed no proof of claim for any unpaid services
\nrendered to either Royal or Buffet.
\n Neither the businesses nor appellant produced invoices from
\nappellant or Front Royal indicating that the bankrupt businesses
\nowed appellant the sums of money indicated on the filed W-2
\nforms. Indeed, invoices from Front Royal to Buffet indicated an
\noutstanding balance of only about $4,000 for the months of July,
\n1994 through October, 1994.
\n From the evidence presented, the jury could conclude beyond
\na reasonable doubt that appellant was not an employee of either
\nBuffet or Royal. Furthermore, appellant admitted that he was not
\npaid the income indicated on the W-2 forms. Although Lang
\ntestified that she “usually” prepared the W-2 forms for Front
\nRoyal, she was unable to explain the discrepancy between the
\namount shown on appellant’s filed W-2 form from Buffet and the
\namount shown on the W-2 form from Buffet’s records. Lang further<\/p>\n
– 12 –
\ntestified that anyone in Front Royal’s office had access to the
\nW-2 forms and could have completed one without her knowledge.
\nMoreover, the W-2 forms filed by appellant were suspect because
\nthe withholding amount for state income taxes on those forms was
\n15% to 18%, whereas the evidence proved that the highest
\napplicable withholding rate in Virginia is 5.75%. Thus, the jury
\ncould infer beyond a reasonable doubt that appellant falsified
\nthe filed W-2 forms, despite appellant’s claim that he did not.
\n“In its role of judging witness credibility, the fact finder is
\nentitled to disbelieve the self-serving testimony of the accused
\nand to conclude that the accused is lying to conceal his guilt.”
\nMarable v. Commonwealth, 27 Va. App. 505, 509-10, 500 S.E.2d
\n233, 235 (1998).
\n Therefore, from the evidence presented, the jury could
\nconclude beyond a reasonable doubt that appellant knowingly and
\nfalsely represented his status as an employee of Royal and Buffet
\nand that he knowingly and falsely represented the information on
\nhis filed 1994 W-2 forms concerning Buffet and Royal. In
\naddition, the jury could infer beyond a reasonable doubt that
\nappellant filed his falsified 1994 tax return with the intent to
\ndefraud the Commonwealth of Virginia of money by obtaining a
\ngreater state income tax refund than that to which he was
\nentitled. The evidence proved that appellant received an
\nadditional $7,000 state income tax refund from the Commonwealth<\/p>\n
– 13 –
\nas a result of the false information he filed concerning Buffet
\nand Royal. Therefore, the evidence was sufficient to prove
\nbeyond a reasonable doubt that appellant committed grand larceny
\nby false pretenses.
\n Appellant also contends that, in order to prove that he
\nreceived something to which he was not entitled, the
\nCommonwealth had to prove that Royal and Buffet did not pay to
\nthe Commonwealth the sums of state income withholding tax
\nindicated on the filed W-2 forms. Appellant argues that the
\nCommonwealth did not research all of the names under which the
\ntwo businesses operated during the time in which the withholding
\ntax could have been paid by the businesses. However, on the
\nrecord before us, nothing in the documents from Royal indicated
\nthat appellant was employed by Royal in 1994 or that Royal paid
\nany withholding state income taxes for appellant in 1994.
\nAlthough Buffet’s records contained a copy of a W-2 form in
\nappellant’s name for 1994, the amount of income and withholding
\ntax on Buffet’s copy of the W-2 form were less than the amounts
\nindicated on the W-2 form filed by appellant. Furthermore,
\nBuffet’s payroll records did not indicate that appellant was an
\nemployee. Thus, the evidence excludes any reasonable hypotheses
\nof innocence. “[T]he Commonwealth need only exclude reasonable
\nhypotheses of innocence that flow from the evidence, not those<\/p>\n
– 14 –
\nthat spring from the imagination of the defendant.” Hamilton v.
\nCommonwealth, 16 Va. App. 751, 755, 433 S.E.2d 27, 29 (1993).
\n The evidence proved that appellant intentionally filed a
\nfalsified 1994 state income tax return and falsified W-2 forms
\nand that he received a state income tax refund in excess of $200
\nfrom the Commonwealth of Virginia to which he was not entitled.
\nThese circumstances are sufficient to prove beyond a
\nreasonable doubt that appellant committed the charged offense.
\n For these reasons, we affirm the conviction.
\n Affirmed.<\/p>\n","protected":false},"excerpt":{"rendered":"
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