646
Argued and submitted August 9, affirmed October 2, 2019
STATE OF OREGON,
Plaintiff-Respondent,
v.
MICHAEL SHANE CHASTAIN,
Defendant-Appellant.
Lane County Circuit Court
17CR16892; A166644
451 P3d 646
Defendant pleaded guilty to first-degree theft after police found parts of a
custom-built motorcycle on his property. Defendant objected to the state’s request
of $82,000 in restitution to the victim for the stolen motorcycle. In defendant’s
view, the value of the motorcycle was limited to the amount that the victim’s
insurer paid to the victim, $26,758. Because the motorcycle was a one-of-a-kind
showpiece with no readily available market to establish its reasonable market
value, the trial court measured the cost of the parts and the labor used to construct the motorcycle as the reasonable market value. In a supplemental judgment, the trial court ordered restitution in the amount of $82,000. Defendant
appeals. Held: The trial court did not err. Evidence in the record supported the
trial court’s finding that there is no market for the custom-built motorcycle.
Because no comparable sales or market price existed, the trial court appropriately considered replacement costs to determine market value.
Affirmed.
Charles M. Zennaché, Judge.
Anne Fujita Munsey, Deputy Public Defender, argued the
cause for appellant. Also on the brief was Ernest G. Lannet,
Chief Defender, Criminal Appellate Section, Office of Public
Defense Services.
Greg Rios, Assistant Attorney General, argued the cause
for respondent. Also on the brief were Ellen F. Rosenblum,
Attorney General, and Benjamin Gutman, Solicitor General.
Before Lagesen, Presiding Judge, and Powers, Judge, and
Kistler, Senior Judge.
KISTLER, S. J.
Affirmed.
Cite as 299 Or App 646 (2019) 647
KISTLER, S. J.
Defendant appeals from a supplemental judgment
of restitution entered after he pled guilty to, among other
things, first-degree theft. He argues that the trial court
erred in awarding the victim $82,000 in restitution for the
stolen property. We affirm the trial court’s judgment.
The victim owned a custom-built, three-wheeled
motorcycle (the “Trike”),1 which he designed with the help
of other machinists over a period of years. Everything on
the Trike “had to be custom built except the engine, and
even the engine had to be modified.” The victim testified
that the parts used to construct the Trike cost “between 60
and 70,000,” dollars2 and he submitted receipts in support
of his testimony. He testified that he had paid two other
persons to help him build the Trike, and he estimated that
the total cost of the parts and labor were “close to 100,000”
dollars. The Trike was primarily a show piece, which the
victim transported from one show to another in a trailer.
The Trike had been driven only six or seven thousand miles
since the victim first registered it in 2002.
In 2017, the victim took the Trike to a shop to
upgrade the front end. While it was in the shop, a person
named Rentfrow stole it. Rentfrow sold the Trike for a minimal amount to defendant, who cut it up for parts.3 When
the police recovered what was left of the Trike, they were
able to salvage some of the parts, which the insurance company valued at approximately $8,000. The insurance company paid the victim $26,758 for the Trike, after deducting
$8,000 for the recovered parts. In discussing the payment
from the insurance company, the victim testified that he and
the company had gone “back and forth, and they said, ‘Well,
it’s difficult [to value the Trike] because it’s not just a one
model car you can get, and you have a price [for that car],
1
A picture of the Trike is attached as an appendix to this opinion.
2
The forks and front wheel had been removed from the Trike before it was
stolen. In calculating the cost of constructing the Trike, the victim excluded the
cost of those parts.
3
Defendant argued at the restitution hearing that he had merely left the
Trike unprotected and that someone else had cut it up. To the extent that the
point matters, the evidence at the restitution hearing—particularly, the acetylene torch found in defendant’s vehicle—permitted the trial court to find that
defendant was the one who cut up the Trike.
648 State v. Chastain
and there’s a Blue Book [for it], and so’—so they h[agg]led
with me. Really unsatisfacturally [sic], so to speak.”4 No
other evidence was offered at the restitution hearing regarding the value of the Trike.
In closing argument at the restitution hearing,
defense counsel did not dispute that the Trike was a one-of-a-kind vehicle. Indeed, she acknowledged that “we can’t
really Blue Book this motorcycle because it’s unique.”
Defense counsel observed, however, that the value of the
vehicle and the cost of the parts were not necessarily equal.
She noted that, if she put new tires on her truck, the value
of her truck would not increase by the amount she paid for
the tires.5 She asserted that “insurance companies are …
the experts in this matter,” and she contended that the trial
court should accept the amount that the insurance company
had paid the victim for the Trike as its market value at the
time and place that it was stolen.
The state responded that “[t]here’s no authority
whatsoever that what the insurance company says that
they’ll pay is the value of the stolen property in this particular case.” The state contended, and defendant did not
dispute, that the motorcycle was a “show vehicle, primarily
trailered to different locations. And it was in mint condition.”
The state argued that, because the Trike was not “something
you can just readily buy,” the cost of building the Trike was
the best measure of its value at the time of the theft. The
state noted that the victim had testified that he had put
over $100,000 into building the Trike and that that figure,
reduced by the value of the recovered parts and presumably
other factors, supported a restitution award of $82,000.6
4
The statement quoted above is the only description in the record of how the
insurance company arrived at the amount it was willing to reimburse the victim
for his loss.
5
Beyond that, defense counsel made no other argument against using the
cost to build the Trike as a basis for determining its market value.
6
Other than noting that the $100,000 estimated cost had been reduced by
the value of the recovered parts, the state did not explain why it had asked for
$82,000 in restitution. It noted that Rentfrow, the person who had taken the
Trike initially, had been ordered to pay $82,000 in restitution in a separate criminal proceeding. Apparently, as a result of deductions made in that proceeding,
the state had arrived at $82,000 as the value of the loss. The state noted that,
if the court awarded restitution, defendant and Rentfrow would be jointly and
severally liable for the amount that was owed.
Cite as 299 Or App 646 (2019) 649
In considering whether to award restitution, the
court initially found that defendant had engaged in criminal activities that had caused the victim economic damages.
It then turned to the amount of economic damages that
should be awarded. The court noted that, if it were dealing
with a standard model vehicle, it would agree with defendant that “the insurance company’s value should be considered in deciding what the fair market value of the … bike
is.” And it also agreed that, as a general proposition, the
sum of the parts can exceed the value of a completed vehicle.
The court reasoned, however, that “this is a different kind of
animal. This is a very unique thing. This is a custom bike. It
is not something that there was a ready market for. It’s one-of-a-kind.” The court accordingly “reject[ed] the Defense’s
argument that the economic damages should be limited to
the market value of the completed vehicle,” measured by the
amount that the insurance company had paid the victim.
The court found that the cost of the vehicle, measured by the
cost of the parts and the labor used to construct it, provided
a more accurate measure of its value at the time and place
that it was stolen. It accordingly ordered defendant to pay
the victim $82,000 in restitution. The court made the obligation joint and several with Rentfrow’s obligation, established in a separate criminal proceeding, to pay the same
amount of restitution.
The trial court’s reasoning consisted of two steps.
First, the trial court found that, because the Trike was a
one-of-a-kind vehicle, there was no “market” for it and thus
no Blue Book value or comparable sales that would establish
its value at the time of the theft. Second, as between the two
alternative methods of establishing the Trike’s value that
the parties proposed, the court rejected defendant’s argument that it should adopt the amount that the insurance
company had reimbursed the victim and relied instead on
the cost that the victim testified that he had incurred in
constructing the Trike ($100,000), discounted by $18,000.
On appeal, defendant challenges each of those steps, and he
adds a third issue that he did not raise below. He contends
that the trial court should have subtracted some of the costs
listed on the receipts that the victim submitted. We consider
each of those issues in turn.
650 State v. Chastain
Defendant does not dispute that the trial court
properly awarded the victim the “economic damages” that he
sustained as a result of defendant’s theft; that is, defendant
does not dispute on appeal that his theft caused the victim’s
economic loss. See State v. Islam, 359 Or 796, 798,
377 P3d
533 (2016) (defining when restitution may be awarded). And
he recognizes that the amount of economic damages that
the victim could recover as a result of the theft is measured
by the amount of damages that would be recoverable in a
civil action for conversion. See State v. Rosette,
289 Or App
581, 588-89,
410 P3d 362 (2017) (explaining that conversion
is the comparable civil action to determine the amount of
restitution for the crime of theft). Finally, as both defendant
and the state recognize, “ ‘the measure of damages for the
conversion of personal property is the reasonable market
value of the goods converted at the time and place of conversion.’ ” Hayes Oyster Co. v. Dulcich,
170 Or App 219, 226,
12
P3d 507 (2000) (quoting Hall v. Work,
223 Or 347, 357,
354
P2d 837 (1960)).
Ordinarily, the “reasonable market value” of personal property is the market price. See id. at 229 (upholding
the trial court’s factual finding that there was a market for
unseeded oyster shells that precluded consideration of alternative methods of valuing the shell). If, however, there is
no market for the converted property, then the trier of fact
may consider other methods of determining market value.
See id. at 228 (explaining that “a party may always prove
that there is no market for property … as a precondition to
offering alternative methods of valuation”).7 In this case, the
trial court found that there was no “market” for the Trike,
and there is evidence in the record to support that finding.
See id. at 229 (upholding the trial court’s finding that there
was a market for unseeded oyster shell because it was supported by evidence in the record). Indeed, defendant admitted in closing argument that “we can’t really Blue Book this
motorcycle because it’s unique.”
7
A trial court also may consider alternative methods of valuation if the converted property consists of personal effects, such as household furniture. See
Hall, 223 Or at 361-62. That is true even if there is a market for used household
furniture. The state does not contend in this case that the Trike is a “personal
effect.” Rather, it relies on evidence in the record that permitted the trial court to
find that there was no market for the Trike.
Cite as
299 Or App 646 (2019) 651
It follows that, on this record, the trial court correctly looked, not to evidence of comparable sales, but to
other methods of valuation to determine the Trike’s market
value. On that point, defendant relied on the amount that
the insurance company paid the victim for the Trike as, in
effect, an expert opinion on its market value. As the trial
court noted, however, although an insurance company’s offer
on a standard model car could provide a reliable estimate of
its market value in some circumstances, an insurer’s offer
on a one-of-a-kind vehicle like the victim’s Trike stands on
a different footing. That is particularly true in this case,
where there is no information on the policy terms or how the
insurance company arrived at the value reflected in its offer
for this one-of-a-kind vehicle.
In determining the market value of unique property, where no comparable sales or “market price” exists,
trial courts may consider replacement cost, discounted for
depreciation. See Dan B. Dobbs, 1 Dobbs Law of Remedies
§ 5.16(3), 907 (2d ed 1993) (explaining that replacement cost,
discounted for depreciation, is an appropriate consideration
in determining the market value of converted personal property when no “market price” exists); cf. Dept. of Rev. v. Rivers
Edge Investments, LLC, 359 Or 822, 828,
377 P3d 540 (2016)
(explaining that in determining the market value of unique
real property, trial courts may consider cost and the property’s income producing potential). Given that methodology,
we cannot say that the trial court erred in relying on the
original cost of building the Trike to determine its market
value at the time and place of the theft.
To be sure, when a court relies on cost (either original or replacement) to determine a property’s market value,
adjustments normally will be required to take account for
such things as the property’s condition at the time of the
theft. Defendant, however, does not dispute that the Trike
was in mint condition, and he has not argued, either at trial
or on appeal, that the cost of the bike should have been
adjusted to take depreciation into account. The only comparable argument that defendant raises on appeal is that
some of the costs reflected in the receipts the victim submitted should not have been considered in determining the
cost of constructing the Trike. Specifically, defendant notes
652 State v. Chastain
on appeal that, in addition to including the cost of the parts
used to construct the Trike, the receipts before the trial court
also included the cost of maintenance—oil changes and the
like. He contends that those amounts should not have been
considered in determining the Trike’s market value.
Defendant did not raise that issue below and may
not raise it for the first time on appeal. See State v. Moles,
295 Or App 1, 4,
433 P3d 497 (2018) (generic objection to an
instruction at trial did not preserve the more specific objection that the defendant later raised on appeal). Moreover,
we note that the trial court did not award the victim the full
amount of the costs that he incurred in building the Trike.
Rather, the victim requested and received only $82,000 in
restitution; specifically, the victim reduced the estimated
$100,000 cost of constructing the vehicle by $18,000 when he
sought restitution in this case. The record does not reflect all
the reasons for that reduction. Although the state observed
that the victim had reduced his request to reflect the value
of the recovered parts, which were valued at approximately
$8,000, that still leaves an additional reduction of approximately $10,000.8
As noted above, the $82,000 request for restitution
mirrored the amount of restitution awarded in a separate
criminal proceeding involving Rentfrow. It may be that any
and all questions regarding appropriate adjustments to the
$100,000 cost of constructing the Trike were addressed in
Rentfrow’s separate restitution hearing and led to a restitution award of $82,000. In any event, in the absence of any
objection in this case that the $82,000 restitution request
improperly included specific costs, such as oil changes and
the like, we conclude defendant failed to preserve that issue.
For the reasons stated above, we affirm the trial court’s
judgment.
Affirmed.
8
According to the record, the $100,000 estimated cost did not include the
value of the front forks and wheel, which had been removed before the Trike was
stolen. Moreover, there is no indication that the $18,000 reduction included the
amount paid by the insurance company.
Cite as 299 Or App 646 (2019) 653
APPENDIX
