State v. Azadeh

                                  528

   This is a nonprecedential memorandum opinion
    pursuant to ORAP 10.30 and may not be cited
         except as provided in ORAP 10.30(1).
 Submitted December 7, 2022, supplemental judgment reversed, remanded for
             resentencing, otherwise affirmed August 16, 2023


                    STATE OF OREGON,
                     Plaintiff-Respondent,
                               v.
                  ANTHONY R. AZADEH,
                    Defendant-Appellant.
               Washington County Circuit Court
                    20CR68978; A175808


   Rebecca D. Guptill, Judge.
   Ernest G. Lannet, Chief Defender, Criminal Appellate
Section, and Peter G. Klym, Deputy Public Defender, Office
of Public Defense Services, filed the brief for appellant.
   Ellen F. Rosenblum, Attorney General, Benjamin Gutman,
Solicitor General, and Nicholas C. Greenfield, Assistant
Attorney General, filed the brief for respondent.
  Before Shorr, Presiding Judge, and Mooney, Judge, and
Pagán, Judge.
   MOONEY, J.
   Supplemental judgment reversed; remanded for resentencing; otherwise affirmed.
Nonprecedential Memo Op: 

 (2023)                                 529

           MOONEY, J.
         Defendant was convicted of one count of interfering with a peace officer, ORS 162.247,1 based upon a negotiated plea in which defendant agreed to pay restitution in
an amount to be determined by the trial court.2 Following
a hearing, the court ordered defendant to pay Washington
County (the county) restitution in the amount of $2,235.87.
Defendant assigns error to the trial court’s order, as reflected
in the supplemental judgment, that he pay restitution to the
county, arguing that the county does not qualify as a victim
under the restitution statutes. The state argues first that
defendant failed to preserve that argument; however, we
conclude that he did. The state then argues that the county
qualifies as a victim under ORS 137.103(4)(b) and under
ORS 137.103(4)(d). We conclude that the record does not support the conclusion that the county is a “victim” under paragraph (4)(b), and the state has failed to develop an argument that the county is a victim under paragraph (4)(d).
We reverse the supplemental judgment as to restitution,
remand for resentencing, and otherwise affirm.
          We review the trial court’s imposition of restitution
for legal error. State v. Lobue, 

, 

,
rev den, 

 (2020). We are bound by the sentencing
court’s findings if they are supported by any evidence in the
record. 

 In assessing the legal sufficiency of the evidence
to support a restitution award, we view the evidence in the
light most favorable to the state, including reasonable inferences. State v. Mothershed, 

, 

(2022). We state the facts in accordance with that standard.
         Sergeant O’Reilly works for the Washington County
Sheriff’s Office in the patrol division. He was on duty when

    1
      ORS 162.247(1) provides, as relevant here, that:
         “A person commits the crime of interfering with a peace officer … if the
    person, knowing that another person is a peace officer … intentionally or
    knowingly acts in a manner that prevents, or attempts to prevent, the peace
    officer … from performing the lawful duties of the officer with regards to
    another person or a criminal investigation.”
    2
      The trial court is required to order restitution if it “finds from the evidence
presented that a victim suffered economic damages,” in an amount “that equals
the full amount of the victim’s economic damages as determined by the court.”
ORS 137.106(1)(a).
530                                                        State v. Azadeh

they received a call from defendant’s father requesting that
an officer come to his home to arrest his son on an active warrant. When O’Reilly arrived to execute the arrest warrant,
defendant jumped out of his window and ran. O’Reilly gave
chase on foot and ultimately caught and arrested defendant,
but he sustained injuries to his hands, arms, face, and knee
in that process. O’Reilly sought medical treatment for his
injuries and missed four days of work while he recuperated.
         The county is self-insured for workers’ compensation claims up to $600,000. It contracts with a third party
claims administrator, CorVel, for claims processing services
within its self-insured retainage. If the county did not contract with a third party administrator to manage its self-insured workers’ compensation program, it would pay its
own employees to perform those functions.3 The county pays
CorVel an annual fee, set by contract, regardless of claims
activity. It pays CorVel an additional set fee for each claim
that CorVel opens and processes for the county’s employees.
         CorVel managed O’Reilly’s workers’ compensation
claim and the county, in turn, paid CorVel the agreed-upon
fee of $1,190.25 for those services. CorVel would not have
charged that fee, and the county would not have paid it, if
O’Reilly had not been injured on the job and filed a workers’
compensation claim.
        CorVel paid the medical bill from Kaiser for services
rendered to O’Reilly in the amount of $318.50, and it also
paid O’Reilly’s time loss wages in the amount of $727.12.
CorVel made those payments on behalf of the county as its
claims administrator.
         The state requested that the court impose restitution for the medical and time loss payments as well as the

    3
       The county’s risk management representative testified that the county
would need to provide claims management services itself in the absence of a third
party contract for such services. See ORS 656.017(1) (requiring subject employers, like the county, to “perform all duties and pay other obligations required”
under the workers’ compensation laws by qualifying either as a “carrier-insured
employer” or a “self-insured employer”); ORS 656.407 (generally requiring a self-insured employer to establish that it has “an adequate staff qualified to process
claims promptly and has the financial ability to make certain the prompt payment of all compensation and other payments that may become due to the director under this chapter”).
Nonprecedential Memo Op: 

 (2023)                   531

claims processing fee that the county incurred, in the total
amount of $2,235.87.
        Defendant objected to the requested restitution
award, arguing that his criminal conduct did not cause the
losses:
      “So, we are objecting to the imposition of restitution
   today. We have several bases for that. And just as an overview, we’re objecting to the imposition generally on a basis
   that the—I think, as the evidence you saw today shows
   that the causation part is too attenuated.
       “And then also, specifically, we’re objecting to the imposition [of] the three requested restitution amounts based on
   the three exhibits that you saw.
      “…
      “[T]he county is a self-insured entity. They pay a thirdparty administrator to administ[er] these claims. That is
   the cost of being self-insured.
      “That is not under what I believe is [ORS] 137.103,
   which is the statute defining—or providing definitions for
   restitution.
      “And, specifically, under 137.103(4)(d), which allows
   an insurance carrier, if it has expended money on behalf
   of a victim, to be reimbursed in restitution. This wasn’t
   expended on behalf of a victim. This was expended pursuant to a contract that the county has …. This is the cost of
   doing insurance business.”
The trial court disagreed and included the amounts
requested in the restitution award.
         The state asserts that defendant did not adequately
preserve his argument that the county does not qualify as
a victim under ORS 137.103(4)(b) or (4)(d) because his argument was not specific enough to alert the trial court to his
contention. Preservation ensures that the trial court has a
“chance to consider and rule on a contention, thereby possibly avoiding an error altogether or correcting one already
made[.]” Peeples v. Lampert, 

, 

(2008). It “ensures fairness to opposing parties” by avoiding
surprise, State v. Walker, 

, 

(2011), and it “fosters full development of the record, which
532                                           State v. Azadeh

aids the trial court in making a decision and the appellate
court in reviewing it.” Peeples, 

. Although
raising an issue at trial is ordinarily essential to its preservation for appeal, identifying a specific source of authority
for the issue is less critical, and making a particular argument is even less significant than citing a specific authority.
State v. Fox, 

, 

 (2022).
          Defendant’s argument was sufficiently specific to
serve the principles of preservation. He argued that the
causal link between defendant’s criminal activity and the
county’s claimed economic damages is too attenuated, which
goes directly to the question of whether the county qualifies
as a victim under ORS 137.103(4)(b). He also made a specific reference to ORS 137.103(4)(d) and the county’s role as a
self-insured employer, which goes to the question of whether
the county qualifies as a victim under ORS 137.103(4)(d). We
need not slice the “preservation onion” too thinly to conclude
that defendant preserved his argument here. See State v.
Amaya, 

, 

 (2004) (explaining
that “problems … may arise if the preservation onion is
sliced too thinly”).
         We turn to the merits. A sentencing court is required
to order restitution if it “finds from the evidence presented
that a victim suffered economic damages,” in an amount
“that equals the full amount of the victim’s economic damages as determined by the court.” ORS 137.106(1)(a). But
restitution is intended to be “penal, not compensatory. Thus,
restitution must be understood as an aspect of criminal law,
not as a quasi-civil recovery device.” State v. Dillon, 

, 

 (1981).
         To request restitution, the state must first identify
the victim in whose behalf it seeks restitution. We begin
with the definition of “victim” in ORS 137.103(4). The relevant paragraphs here are (a), (b), and (d):
      “ ‘Victim’ means:
      “(a) The person … against whom the defendant committed the criminal offense, if the court determines that
   the person … has suffered or did suffer economic damages as a result of the offense.
Nonprecedential Memo Op: 

 (2023)            533

      “(b) Any person … whom the court determines has
   suffered economic damages as a result of the defendant’s
   criminal activities.
      “…
      “(d) An insurance carrier, if it has expended moneys
   on behalf of a victim described in paragraph (a) of this
   subsection.”
ORS 137.103(4).
         Paragraph (a) refers to the “direct victim of a
crime.” State v. Zuniga, 

, 750, 

(2017). There is no dispute that O’Reilly was the direct victim of defendant’s crime, and that the county was not. Thus,
the question under paragraph (b) is whether the county, as
an entity not described in subsection (a), suffered economic
damages as a result of the defendant’s criminal activities.
The questions under paragraph (d) are whether the county
is “an insurance company” and, if it is, whether it “expended
moneys” on behalf of O’Reilly.
          Restitution requires proof of “(1) criminal activities, (2) economic damages, and (3) a causal relationship
between the two.” State v. Smith, 

, 

 (2018); see ORS 137.106(1)(a) (district attorney to
present “evidence of the nature and amount of” economic
damages to court). “The plain import of ORS 137.106 is that,
when a person is convicted of a crime, the trial court may
impose restitution for damages recoverable in a civil action
arising out of the facts or events constituting that crime
or any other criminal conduct admitted by the defendant.”
State v. Howett, 

, 

 (2002).
Simply put, restitution is “a process to allow a victim to ask
the criminal court to award the damages that the victim
would be able to obtain in a civil action.” State v. Ramos, 

, 

 (2016).
        The type of damages allowable as restitution are
“economic damages” as defined in ORS 31.705, with an
express exception for “future impairment of earning capacity.” ORS 137.103(2)(a). ORS 31.705(2)(a) defines economic
damages as:
534                                            State v. Azadeh

       “objectively verifiable monetary losses including but
   not limited to reasonable charges necessarily incurred for
   medical, hospital, nursing and rehabilitative services and
   other health care services, burial and memorial expenses,
   loss of income and past and future impairment of earning
   capacity, reasonable and necessary expenses incurred for
   substitute domestic services, recurring loss to an estate,
   damage to reputation that is economically verifiable, reasonable and necessarily incurred costs due to loss of use
   of property and reasonable costs incurred for repair or for
   replacement of damaged property, whichever is less.”
         The Supreme Court recently held that “that the legislature did not intend to permit courts to award, as ‘economic damages,’ the attorney fees that a victim chooses to
incur in a criminal case to protect their interest in obtaining an award of restitution.” Fox, 

. In doing so,
it acknowledged that “neither ORS 137.106(1) nor the definition of economic damages in ORS 31.710(2)(a) requires that
damages awarded in restitution be limited to what would be
recoverable in a civil action,” but it noted that “the legislative history and evolution of the restitution statutes indicate
that the legislature did not intend to differentiate between
the ‘economic damages’ that a victim could recover as damages in a civil action and those that the victim could recover
as restitution.” 

. We understand that discussion
to reflect the court’s continued view that the “civil law concepts” incorporated into the restitution process serve as a
“circumscription of the authority of the court” to determine
restitution. Dillon, 

.
        We turn to the facts of this case and, as we will
explain, conclude that the county does not qualify as a victim under ORS 137.103(4)(b).
         The $1,190.20 “Workers’ Comp Fee” was an administrative charge incurred by the county as a contractually
negotiated fee with its third party administrator for managing O’Reilly’s injury claims in particular. The state argues
that the fee was triggered as a direct result of the injuries
caused by defendant’s criminal conduct, and the record supports that argument. Given that the fee would not have been
incurred but for the injuries O’Reilly sustained as a result
of defendant’s criminal conduct, the question is whether the
Nonprecedential Memo Op: 

 (2023)              535

county would be able to recover that claims processing fee
in a civil action against defendant. The county incurred the
fee in order to carry out its statutory obligation to provide
workers’ compensation benefits for its employees. It was
not a payment made to O’Reilly, and it did not make that
expenditure on his behalf. O’Reilly would have no right to
claim such a fee in a civil suit against defendant and the
county would, likewise, have no right to pursue such a fee
on O’Reilly’s behalf. The state offers no theory of liability for
the county to recover that fee in its own behalf, and we are
hard-pressed, on this record, to think of one.
         The testimony offered by the state concerning the
$727.12 in “lost wages” was simply that the $727.12 was paid
to O’Reilly for his four-day time loss. Defendant argues that
the county does not qualify as a “victim” with respect to that
payment because it would have been responsible for paying
O’Reilly’s wages in the absence of defendant’s conduct anyway. It is true that the county would have paid O’Reilly’s
wages whether or not he was injured. And we have generally
held that “the regular salaries of law enforcement officers
involved in an investigation” cannot be included in restitution awards “principally because they are incurred irrespective of specific violations of law.” State v. Heston, 

, 

 (1985).
         But as we understand the state’s position, it contends that the county would not also have lost O’Reilly’s
services and that that loss of services represents a loss to
the county separate from the wages it paid O’Reilly while
he was recuperating. It will either replace those services or
not. But in either case, the state argues that there is the loss
of value, either in the additional expense to replace those
services or in the reduced capacity to provide services if
not replaced. We return to the question whether the county
would be able to recover such a loss in a civil action against
defendant. The state offers no theory of civil liability for this
claim either. That the county incurred expenses related to
O’Reilly’s injuries is not enough, without more, to support
an award of restitution against defendant. The state must
establish that the county could recover that loss from the
defendant in a civil cause of action, but the record reflects
that it did not do so.
536                                                         State v. Azadeh

          The testimony concerning the $318.50 paid for
O’Reilly’s medical bill was that CorVel paid the bill for services rendered to O’Reilly, on behalf of the county. The state
sought restitution on behalf of the county for that payment
arguing that “a self-insured employer has a civil cause of
action against a third person responsible for injuring their
employee.” In support of that argument, the state relies upon
ORS 656.591(1)4 and State v. Divers, 

, 

 (1981). But Divers is not as broad as the state argues.
We concluded there that if the injured worker assigned his
cause of action to his employer by electing not to file an
action against the wrongdoer, “there would be no problem
with ordering restitution to be made to an insurance company which in all other respects was a victim of the defendant’s criminal activities.” Divers, 

. There
is nothing in the record to show that O’Reilly made such an
election.
         Dillon is instructive on that point. Dillon concerned
payments made by the Adult and Family Services Division
of the Department of Human Resources (AFS) for emergency medical treatment services provided to the defendant
for injuries he sustained while engaged in the criminal conduct for which he was convicted. 

. AFS was
required to provide those services to defendant as a “medically needy” person. 

. Because the record did not
disclose “facts giving rise to a theory of civil liability under
which AFS could recover defendant’s medical expenses from
him[,]” the sentencing court could not have concluded that
AFS was a victim for purposes of imposing restitution. 

. Here, the county was required to pay for O’Reilly’s
job-related medical expenses. Any right it has to seek reimbursement from defendant requires O’Reilly’s election not to
sue defendant in his own behalf and, as already explained,
the record does not show that such an election was made.

   4
     ORS 656.591(1) provides that:
       “An election made pursuant to ORS 656.578 not to proceed against an
   employer or third person operates as an assignment to the paying agency of
   the cause of action, if any, of a worker or the beneficiaries or legal representative of a deceased worker against the employer or third person, and the
   paying agency may bring action against the employer or third person in the
   name of the worker or other beneficiaries.”
Nonprecedential Memo Op: 

 (2023)                537

         Given that, on this record, the county would not be
able to recover the claimed restitution amounts from defendant in a civil case, it does not qualify as a victim under
ORS 137.103(4)(b).
           In its final argument, the state asserts that the county
“plausibly qualifies” as a victim under ORS 137.103(4)(d)
because it “plausibly qualifies” as an “insurance carrier”
that has “expended moneys on behalf of a victim.” But the
state does not develop that argument, and we decline to do
so for it. See R. S. R. v. Dept. of Human Services, 

, 

 (2022).
         The trial court was not authorized to impose the
restitution that it did on this record. We, therefore, reverse
the supplemental judgment as to restitution and remand for
resentencing. See State v. Moreno-Hernandez, 

, 

 (2019) (explaining that the appropriate
disposition is to remand to the trial court for resentencing
where the trial court committed legal error in sentencing
a defendant to pay a “compensatory fine” to a victim of the
crime, when there might be other permissible options for the
trial court to adopt on resentencing); State v. Travers, 

, 

 (2021) (reversing supplemental judgment and remanding for resentencing where trial
court erred in including medical expenses in the restitution
order, but did not err in including certain other expenses in
the restitution order).
        Supplemental judgment reversed; remanded for
resentencing; otherwise affirmed.