author: STONEBURNER, Judge.

text:
    L.M., a minor, by her parents and natural guardians S. and D.M., et al., Appellants, v. Tom G. KARLSON, Respondent, New Horizon Enterprises, Inc., et al., Respondents, State of Minnesota, et al., Respondent.
    No. CX-01-1672.
    Court of Appeals of Minnesota.
    June 18, 2002.

      Kay Nord Hunt, John R. McBride, Sheila A. Bjorklund, Lommen, Nelson, Cole & Stageberg, P.A., Minneapolis, MN, for respondent New Horizon.
    Teresa K. Patton, Susan M. Coler, Sprenger & Lang, PLLC, Minneapolis, MN, for appellants.
    Considered and decided by STONEBURNER, Presiding Judge, HARTEN, Judge, and ANDERSON, Judge.
   OPINION

STONEBURNER, Judge.

Appellants, children and parents of children who were abused by their day-care teacher, Tom Karlson, appeal dismissal of their claims of respondeat superior and negligent hiring, supervision, and retention against .Karlson’s employer, respondent New Horizon Enterprises, Inc. (New Horizon). Appellants also challenge denial of their motion to amend the complaint to add a claim for punitive damages. Because there is a genuine issue of material fact as to whether sexual abuse is a foreseeable risk of the day-care industry,, we reverse the district court’s grant of New Horizon’s motion for summary judgment and remand for a trial on appellant’s re-spondeat superior and negligent supervision claims. Because the evidence does not establish a genuine issue of material fact as to whether New Horizon knew or should have known that one of its day-care teachers had sexually abused a child in the past and was sexually abusing children at New Horizon, we affirm the district court’s grant of summary judgment on appellants’ negligent hiring and negligent retention claims.

FACTS

After Tom Karlson graduated from Ano-ka-Hennepin Technical College’s child-development program, he was employed by A to Z Child-care Center as an assistant teacher. He applied for a position with New Horizon. Susan Robbins, director of New Horizon’s Maple Grove New Horizon Child-care Center, interviewed Karlson in September 1995. Robbins called A to Z Child-care Center, which gave Karlson a positive reference.

A background study is required for each person who will have direct contact with children in a day-care center. Minn.Stat. § 245A.04, subd. 3 (1994 & Supp.1995); Minn. R. 9543.3030 (1995); Minn. R. 9543.3040, subps. 1, 2 (1995). Licensed day-care programs such as New Horizon are required to submit an application for a background study to DHS when they first employ a child-care worker and annually thereafter. Day-care providers must maintain documentation of background-study applications in the employee’s personnel file. Minn.Stat. § 245A.04, subd. 3 (1994 & Supp.1995); Minn. R. 9543.3040, subps. 1, 5 (1995). The purpose of the study is to determine whether any of the disqualifíers set forth in the statute and regulations is present. If any is present, then the person under study is disqualified from being permitted to work with children in a licensed program. Minn. R. 9543.3070, subp. 1 (1995). Robbins recalls that Karlson filled out a background-study application. Robbins does not remember mailing the application. It is undisputed that DHS did not respond to a background-study application on Karlson and has no record in its database of having received the background-study application. When a background study is completed, the only information provided to the requesting program is: (1) notification that the subject is not disqualified; (2) notification that additional time is needed for the study; or (3) notification that the subject is disqualified from direct contact with children. Minn. R. 9543.3060, subps. 5, 6 (1995). The last background study done on Karlson, before he was hired by New Horizon, was completed on March 28, 1995, and he was not disqualified from direct contact with children.

DHS interpretive guidelines permit an individual to have direct contact with children before a program receives a response to the request for a background study because it can take from two weeks up to a year and a half or more to obtain from DHS a completed background study on an employee. In this case, it is undisputed that if New Horizon had submitted a background-study application at the time Karl-son was hired, he would not have been disqualified from direct contact with children. But DHS would have requested more information from Isanti County because DHS was aware that, in connection with an application Karlson submitted in Isanti County to become a foster parent, there was an allegation that Karlson had sexually abused a child eight years earlier.

Karlson taught three and four-year-old children at New Horizon. His classroom was divided from the preschool room next door with glass sliding doors. The glass sliding doors were surrounded by glass as well. Karlson’s room had windows on the outer walls looking onto the playgrounds. Doors to the classrooms at New Horizon were kept open most of the time, and, except during nap-time, another teacher was usually present in the adjoining classroom. The only part of the classroom that was not easily visible from the next room was the bathroom. During nap-time, the doors between Karlson’s room and the adjoining room were open and Karlson and the other teacher alternated monitoring the children in both rooms. Karlson admitted that he sexually abused several children, usually in the bathroom, during nap-time.

In June 1996, New Horizon hired Traci McPherson to work with Karlson. After three weeks, McPherson asked to be moved to another room because she disagreed with Karlson’s teaching strategies. She believed that he was verbally abusive and physically rough with the children, but McPherson did not suspect that Karlson was sexually abusing children. Jennifer Odden, a child-care co-worker at New Horizon, expressed concerns to Robbins about Karlson’s lack of teaching skills. Corrie Nichols, a child-care co-worker at New Horizon, expressed concerns to Robbins about inappropriate comments Karl-son made in front of children. Robbins recalled speaking with Karlson once about a parent who had concerns about ensuring that Karlson did educational activities and once about a parent who wanted more papers sent home about the child’s day. Robbins did not recall co-workers raising concerns with her about Karlson’s conduct with the children.

Karlson testified that no one at New Horizon ever saw his inappropriate sexual actions with the children, which he tried to keep secret. None of the parents of the involved children reported any concerns to Robbins prior to the police investigation of Karlson. Robbins first learned about potential problems with Karlson when he came to her in August 1996 about a police investigation involving touching children. Robbins immediately sent him home and called New Horizon’s regional manager. Karlson never returned to work at New Horizon.

Appellants sued New Horizon, alleging that New Horizon is responsible for Karl-son’s acts under the doctrine of respondeat superior and is also liable under theories of negligent hiring, supervision, retention, and entrustment, and premises liability. The district court granted New Horizon’s motion for summary judgment on all claims and denied appellants’ motion to amend their complaint to add a claim for punitive damages. Appellants appeal dismissal of their respondeat superior, negligent hiring, negligent supervision, and negligent retention claims and denial of their motion to add a claim for punitive damages.

ISSUES

1. Did appellants provide sufficient evidence to raise a genuine issue of material fact about whether criminal sexual misconduct is a foreseeable risk of the duties of a day-care provider, making adverse summary judgment on their claim of responde-at superior inappropriate?

2. Did the district court err by granting summary judgment for New Horizon on appellants’ claims of negligent hiring, supervision, and retention?

3. . Did the district court abuse its discretion by denying appellants’ motion to amend the complaint to add a claim of punitive damages?

ANALYSIS

1. Standard of Review

When reviewing a grant of summary judgment, we ask whether there are any genuine issues of material fact and whether the district court erred in its application of the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn.1990). No genuine issue of material facts exists “[wjhere the record taken as a whole could not lead a rational trier of fact to find for the non-moving party.” DLH, Inc. v. Russ, 566 N.W.2d 60, 69 (Minn.1997) (alteration in original) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986)). “[T]he party resisting summary judgment must do more than rest on mere averments.” Id. at 71. A genuine issue for trial “must be established by substantial evidence.” Id. at 69-70 (quoting Murphy v. Country House, Inc., 307 Minn. 344, 351, 240 N.W.2d 507, 512 (1976)).

2. Respondeat Superior

An employer is liable for the intentional torts, including inappropriate sexual touching, of its employees if the employees are acting within the scope-of-employment. Fahrendorff v. North Homes, Inc., 597 N.W.2d 905, 910 (Minn.1999); Lange v. Nat’l Biscuit Co., 297 Minn. 399, 401, 211 N.W.2d 783, 784 (1973); see also P.L. v. Aubert, 545 N.W.2d 666, 667-68 (Minn.1996) (applying scope of employment test to circumstance in which teacher engaged in sexual touching of student). In Lange, the Minnesota Supreme Court determined that an employee is acting within the scope of employment when the intentional tort committed by the employee “is related to the duties of the employee and occurs within work-related limits of time and place.” 297 Minn. at 404, 211 N.W.2d at 786.

It is undisputed that the conduct at issue took place during Karlson’s workday, in the classroom, and primarily in connection with his assigned duty of assisting young children in the bathroom. The district court concluded that appellants failed to provide the court with any “evidence that criminal sexual misconduct is a foreseeable risk of the duties of a day-care provider” and granted New Horizon’s motion for summary judgment on the appellants’ claim of respondeat superior.

In Marston v. Minneapolis Clinic of Psychiatry and Neurology, Ltd., the supreme court affirmed the Lange rule and held that where the plaintiff provided evidence that “sexual relations between a psychologist and a patient is a well-known hazard and thus, to a degree, foreseeable and a risk of employment” a question of fact exists as to whether an employer is liable on a respondeat superior claim for a psychologist’s sexual misconduct with a patient. 329 N.W.2d 306, 310-11 (Minn.1982). The court reversed the district court’s grant of judgment notwithstanding the verdict to the employer after a jury found in favor of plaintiff. Id. at 307.

In Aubert, a student claimed that the school-district employer was liable under respondeat superior for the acts of a teacher who engaged in a sexual relationship with him. 545 N.W.2d at 667. The supreme court concluded that the school district was entitled to summary judgment because there was no evidence presented demonstrating that a sexual relationship between a teacher and a student is a foreseeable risk of employing a teacher. 545 N.W.2d at 668. The court noted that the plaintiff had failed to provide the district court with expert testimony or affidavits “regarding the potential for abuse of * * * power between a teacher and a student.” Id. The court also noted that the employer had performed standard teacher evaluations, and made several unannounced visits to the classroom, and that the student and teacher actively concealed the relationship. Id.

In Fahrendorff, however, the supreme court held that a victim of sexual abuse by a group-home parent made a sufficient showing of foreseeability to prevent summary judgment by providing the district court with an affidavit of a purported expert stating that sexual behavior is a “well known hazard in this field.” 597 N.W.2d at 905-12.

Here, appellants provided the affidavit of Marianna Kahkonen. New Horizon has not challenged Kahkonen’s credentials as an expert witness. She has a bachelor’s degree in humanities and child psychology and is pursuing a master’s degree in early childhood education at the University of Minnesota. Kahkonen has worked in the child-care profession since 1983 and has served as executive director for Kinderplatz Childcare and Education Centers since 1986. Her duties include management and administrative duties.

Kahkonen’s initial affidavit stated that new employees at her center are not allowed to work unsupervised with children until a background clearance is received from the state and that in her

professional experience, the possibility of sex abuse of children is certainly a paramount concern for child-care providers * * * because the children are so young and they are vulnerable, easily manipulated, and cannot communicate well.

In her “Professional Opinion Report,” which was also provided to the district court, Kahkonen listed the deposition testimony that she reviewed in this case and stated, in part, that in her professional opinion:

The possibility of sex abuse of children is certainly a paramount concern for childcare providers. Young children are especially vulnerable since they cannot communicate their feelings well.
It is also unreasonable that any employee is allowed to work unsupervised, with continued access to children, after the Administrator of a childcare Center has received reports of alarming behavior.

Appellants argue that this expert affidavit and report, together with the statutory requirement of background studies that specifically cover sexual misconduct and information in training materials provided by New Horizon to Karlson constitute evidence that sexual abuse by a child-care worker is a sufficiently foreseeable risk of employment to withstand New Horizon’s motion for summary judgment.

New Horizon argues that the background studies are mandatory for many licensed professions and represent an attempt to screen out individuals

who, for a myriad of reasons, could be considered a danger to those with whom they work. The fact of screening does not, per se, make every crime a Veil known hazard,’ in the day-care industry.

We agree that the background study alone does not make sexual abuse of children by day-care workers a “well-known” hazard, but it is evidence of awareness by the state that sexual abuse is one of the potential risks involved in any employment involving vulnerable clients.

New Horizon points out that the training materials provided to Karlson do not discuss sexual abuse of children by daycare providers and do not contain any policies or procedures relating to sexual abuse of children.

New Horizon asserts that Kahkonen’s statement that “the possibility of sex abuse of children is certainly a paramount concern for child-care providers” is qualitatively different from the affidavit at issue in Fahrendorff in which the purported expert stated that “inappropriate sexual contact or abuse of power in these situations, although infrequent, is a well known hazard in this field.” Fahrendorff, 597 N.W.2d at 909.

In oral argument, New Horizon asserted that Kahkonen’s statement could refer only to the fact that child-care providers are “mandatory reporters,” alert to the possibility that anyone could be abusing children. We disagree. Examining the affidavit in the light most favorable to appellants, the context of the statement in Kahkonen’s affidavit and report clearly indicates that she is referring to abuse by day-care employees in direct contact with children. As Fahrendorff demonstrates, foreseeability is not necessarily dependent on the frequency of occurrence. Id. at 911-12 (holding that expert affidavit stating inappropriate sexual contact in group homes is infrequent but well-known hazard, created genuine issue of material fact). Kahkonen’s affidavit is conclusory and lacking in specific examples, but similar problems with the affidavits in Fahren-dorff and Marston did not prevent the supreme court from holding such affidavits sufficient to establish a question of material fact on the issue of foreseeability, making summary judgment inappropriate. Id. at 912-18. We conclude that appellants have raised a genuine issue of material fact on the issue of foreseeability and therefore reverse summary judgment on appellants’ respondeat superior claim.

3. Negligent Hiring

A claim of negligent hiring is

predicated on the negligence of an employer in placing a person with known propensities, or propensities which should have been discovered by reasonable investigation in an employment position in which, because of the circumstances of the employment, it should have been foreseeable that the hired individual posed a threat of injury to others.

Yunker v. Honeywell, Inc., 496 N.W.2d 419, 422 (Minn.App.1993) (quotation omitted), review denied (Minn. April 20, 1993). Liability for negligent hiring “is determined by the totality of the circumstances surrounding the hiring and whether the employer exercised reasonable care.” Id.

The district court concluded that summary judgment was appropriate on appellants’ negligent-hiring claim because, despite the fact that New Horizon cannot demonstrate that it submitted a background-study application, the undisputed evidence is that even if DHS performed a background study at the time New Horizon hired Karlson, DHS would not have disqualified Karlson. We agree. An employee of the DHS testified that at the time of Karlson’s hiring in September 1995 there was not sufficient evidence of a problem to disqualify Karlson as a child-care worker, although DHS would have requested other agencies to investigate the seven-year-old allegations made in connection with Karlson’s application to become a foster parent in Isanti County. DHS guidelines permitted Karlson to work directly with children prior to completion of the background study. Evidence in the record indicates that a study by DHS could take longer than six months. There is no evidence that other agencies would have complied with a request from DHS for an additional investigation or would have complied with the request in time to have prevented the abuse in this case. The record supports the district court’s conclusion that appellants have failed to establish a claim of negligent hiring and we affirm summary judgment on this claim.

4.Negligent Retention

Negligent retention

occurs when, during the course of employment, the employer becomes aware or should have become aware of problems with an employee that indicated his unfitness, and the employer fails to take further action such as investigating, discharge or reassignment.

Yunker, 496 N.W.2d at 423-24 (quotation omitted).

The district court concluded that summary judgment on the negligent-retention claim was appropriate because appellants failed to show that any of the complaints made about Karlson made his sexual abuse of the children foreseeable to New Horizon. Appellants contend that they provided sufficient evidence to give rise to a factual issue that New Horizon negligently retained Karlson because coworker complaints and the complaint of a parent were not investigated and because a background study would have revealed problems.

Appellants also argue that any scrutiny of Karlson would have caused him to voluntarily leave this employment. The focus is not on what Karlson might have done, however, but on what the employer should have done. It is undisputed that none of the complaints allegedly made to Robbins implicated inappropriate touching by Karl-son. Because the record supports the district court’s conclusion that there is no evidence that New Horizon was aware or should have been aware that Karlson was sexually abusing children, the district court did not err by granting summary judgment on appellants’ negligent-retention claim.

5. Negligent Supervision

Negligent supervision is derived “from the doctrine of respondeat superior” and, therefore, in order to successfully make out a claim for negligent supervision, a party must show “that the employee’s actions occurred within the scope of employment.” M.L. v. Magnuson, 531 N.W.2d 849, 858 (Minn.App.1995), review denied (Minn. July 20, 1995).

The district court granted summary judgment on this claim based on its conclusion that “sexual misconduct is not a foreseeable risk arising out of the duties of a day-care provider.” But we have concluded that appellants have presented sufficient evidence to give rise to a fact issue as to whether Karlson’s conduct was foreseeable to New Horizon. Because a fact issue exists with regard to foreseeability, the district court erred by granting summary judgment to respondents on appellants’ negligent-supervision claim.

6. Punitive Damages

An appellate court may not reverse a district court’s denial of a motion to add a claim for punitive damages absent an abuse of discretion. LeDoux v. N.W. Publ’g, Inc., 521 N.W.2d 59, 69 (Minn.App.1994), review denied (Minn. Nov. 16, 1994). Here, appellants challenge the denial of their motion to add a claim for punitive damages, arguing that they provided sufficient evidence to meet the test for a claim for punitive damages pursuant to Minn. Stat. § 549.20 (2000).

After a party files an action, the party may move the court to amend its pleading to add a claim for punitive damages. Minn.Stat. § 549.191 (2000). The motion to amend must “allege the applicable legal basis under section 549.20 or other law for awarding punitive damages.” Id. A district court must permit a party to add a claim for punitive damages if “the court finds prima facie evidence in support of the motion.” Id.

In a civil action, punitive damages “shall be allowed * * * only upon clear and convincing evidence that the acts of the defendant show deliberate disregard for the rights or safety of others.” Minn.Stat. § 549.20, subd. 1(a) (2000). A defendant acts with a “deliberate disregard for the rights or safety of others” when

the defendant has knowledge of facts or intentionally disregards facts that create a high probability of injury to the rights or safety of others and:
(1) deliberately proceeds to act in conscious or intentional disregard of the high degree of probability of injury to the rights or safety of others; or
(2) deliberately proceeds to act with indifference to the high probability of injury to the rights or safety of others.

Minn.Stat. § 549.20, subd. 1(b).

The district court declined to address appellants’ motion to amend their complaint to add a claim for punitive damages because it granted New Horizon’s motion for summary judgment. The district court noted that “as to the merits of [the punitive damages] motion, plaintiffs have failed to establish that New Horizon’s conduct rose to the level required by Minn.Stat, § 549.20, subd. 1.” Because the district court did not fully address the issue of punitive damages, we cannot adequately review the denial of the motion for an abuse of discretion. On remand the district court should fully address this issue. By remanding, we do not intend to express any opinion on the merits of appellants’ motion.

DECISION

Appellants’ expert affidavit is sufficient to raise a genuine issue of material fact about the foreseeability of sexual abuse of children by day-care workers, making summary judgment on their claims for re-spondeat superior and negligent supervision inappropriate. The district court did not err by granting summary judgment on appellants’ claims of negligent hiring and negligent retention because the evidence failed to establish that the employer knew or should have known that Karlson had sexually abused a child in the past or was sexually abusing children at New Horizon. Appellant’s motion to amend the complaint to add a claim of punitive damages shall be fully addressed by the district court on remand.

Affirmed in part, reversed in part, and remanded.

      . New Horizon, citing Fakrendorff, notes that simply because a background study is performed does not mean that sexual abuse is foreseeable, but it does not appear that the background study was brought to the court's attention in that case.

      . Because New Horizon's training materials were not contained in the district court file, we are unable to substantiate New Horizon’s claim.


source: Caselaw Access Project

author: WILLIS, Judge.

license: Public Domain

text:
    MUTUAL SERVICE CASUALTY INSURANCE COMPANY, Appellant, v. LEAGUE OF MINNESOTA CITIES INSURANCE TRUST, Respondent.
    No. CX-01-1929.
    Court of Appeals of Minnesota.
    June 26, 2002.

      Jack D. Moore, Moore, Warner & Kruger, St. Paul, MN, for appellant.
    Charles E. Gillen, Stephen F. Buterin, Jardine, Logan & O’Brien, PLLP, Saint Paul, MN, for respondent.
    Michael C. Snyder, Meshbesher & Spence, Ltd., Minneapolis, MN, for amicus curiae Minnesota Trial Lawyers Association.
    Considered and decided by WILLIS, Presiding Judge, SHUMAKER, Judge, and FOLEY, Judge.

       Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.

   OPINION

WILLIS, Judge.

Appellant insurer challenges adverse summary judgment, arguing that the district court erred by concluding that a marked police patrol car is not a “motor vehicle” for purposes of the Minnesota No-Fault Automobile Insurance Act, Minn.Stat. §§ 65B.41-.71 (2000). Because we conclude that applying the plain meaning of the statutory definition of “motor vehicle” to this case produces an absurd and unreasonable result that plainly departs from the first stated purpose of the no-fault act, we reverse and remand.

FACTS

On March 17, 2000, a marked police patrol car, driven by a Rochester police officer and owned by the City of Rochester, struck and injured a pedestrian. Appellant Mutual Service Casualty Insurance Company (MSI) insured the pedestrian as a resident relative under an automobile policy; respondent League of Minnesota Cities Insurance Trust (LMCIT) insured the city under an automobile policy. Both policies provided $20,000 in basic economic-loss benefits, and MSI’s policy provided $60,000 in optional medical-expense benefits. The pedestrian incurred medical expenses in excess of $20,000.

MSI paid the excess and brought a declaratory-judgment action against LMCIT for payment of $20,000 of basic economic-loss benefits on the ground that LMCIT’s policy had a higher priority for payment. See Minn.Stat. § 65B.47 (2000) (providing priority of payment of basic economic-loss benefits). MSI moved for summary judgment. The district court denied MSI’s motion and granted summary judgment to LMCIT, concluding that the pedestrian was not entitled to benefits under LMCIT’s policy because a marked police patrol car is not a “motor vehicle” for purposes of the Minnesota No-Fault Automobile Insurance Act, Minn.Stat. §§ 65B.41-.71 (2000). This appeal follows.

ISSUE

Did the district court err by concluding that a marked police patrol car is not a “motor vehicle” for purposes of the Minnesota No-Fault Automobile Insurance Act, Minn.Stat. §§ 65B.41-.71 (2000)?

ANALYSIS

On appeal from summary judgment, this court determines (1) whether there are genuine issues of material fact and (2) whether the district court erred in its application of the law. Hertz Corp. v. State Farm Mut. Ins. Co., 578 N.W.2d 686, 688 (Minn.1998). The parties agree that there are no disputed facts and that the issue on appeal involves interpretation of the Minnesota No-Fault Automobile Insurance Act (no-fault act), Minn.Stat. §§ 65B.41-.71 (2000). The interpretation of a statute is a question of law, which appellate courts review de novo. Nathe Bros., Inc. v. Am. Nat. Fire Ins. Co., 615 N.W.2d 341, 344 (Minn.2000).

LMCIT’s coverage declarations limit payment for personal-injury claims to “basic Minnesota statutory coverage,” and the parties do not dispute the district court’s finding that the policy provides “benefits coverage for qualifying motor vehicles as required by the [no-fault act].” Thus, the scope of LMCIT’s policy, and the right of a pedestrian to recover benefits under that policy, is determined by the provisions of the no-fault act.

The no-fault act provides:

Every owner of a motor vehicle of a type which is required to be registered or licensed or is principally garaged in this state shall maintain during the period in which operation or use is contemplated a plan of reparation security * * * [that] shall provide for basic economic loss benefits and residual liability coverage.

Minn.Stat. § 65B.48, subd. 1. “[E]very person suffering loss from injury arising out of maintenance or use of a motor vehicle * * * has a right to basic economic loss benefits.” Minn.Stat. § 65B.46, subd. 1.

Here, the parties do not dispute that a marked police patrol car is not required to be registered under chapter 168. See Minn.Stat. § 168.012, subd. 1(b) (2000 & Supp.2001) (providing that “police patrols * * *, the general appearance of which is unmistakable, shall not be required to register”). MSI argues, however, that because the marked police patrol car was a motor vehicle that was principally garaged in Minnesota, Minn.Stat. § 65B.48, subd. 1, requires that it be insured for basic economic-loss benefits. But the statutory definition of “motor vehicle” is

every vehicle, other than a motorcycle or other vehicle with fewer than four wheels, which (a) is required to be registered pursuant to chapter 168, and (b) is designed to be self-propelled by an engine or motor for use primarily upon public roads, highways or streets in the transportation of persons or property.

Minn.Stat. § 65B.43, subd. 2. Therefore, no matter where a vehicle is garaged, it is not within the statutory definition of “motor vehicle” unless it is required to be registered under chapter 168. And the statutory definition of “motor vehicle” applies throughout the no-fault act “except where the context clearly indicates a different meaning.” Minn.Stat. § 65B.43, subd. 1.

The plain language of the no-fault act provides that a vehicle can only be a “motor vehicle” if it is required to be registered under chapter 168, the plain language of the no-fault act’s right-to-benefits provision uses the statutory definition, and there is no context in that provision that “clearly indicates a different meaning.” See MinmStat. § 65B.43, subd. 1. Because marked police patrol cars are not required to be registered under chapter 168, the right-to-benefits provision, on its face, does not grant a person the right to basic-economic-loss benefits for an injury arising out of the use of a marked police patrol car. See Minn.Stat. § 66B.46, subd. 1.

If, on its face and in application to the facts, a statute’s meaning is plain, judicial construction is not normally appropriate. See Am. Tower, L.P. v. City of Grant, 636 N.W.2d 309, 312 (Minn.2001). But although plain meaning is the governing principle in applying statutory language, Minnesota courts will not give effect to plain meaning if it produces an absurd or an unreasonable result that departs from the purpose of the statute. Minn.Stat. § 645.17(1) (2000); Olson v. Ford Motor Co., 558 N.W.2d 491, 494 (Minn.1997); Wegener v. Comm’r of Revenue, 505 N.W.2d 612, 617 (Minn.1993); Anker v. Little, 541 N.W.2d 333, 337 (Minn.App.1995), review denied (Minn. Feb. 9, 1996).

A marked police patrol car is not required to be registered under chapter 168 when its general appearance is “unmistakable.” Minn.Stat. § 168.012, subd. 1(b). But “unmarked vehicles used in general police work” must be registered. Id:, subd. 1(e) (2000 & Supp.2001). Thus, if a pedestrian is struck and injured by an unmarked police patrol car, the pedestrian has the right to basic economic-loss benefits because an unmarked police patrol car must be registered under chapter 168 and therefore meets the no-fault act’s statutory definition of “motor vehicle.” See Minn. Stat. §§ 65B.43, subd. 2, 65B.46, subd. 1. Here, under the plain meaning of the statutory definition of “motor vehicle,” whether a pedestrian has a right to basic economic-loss benefits under the no-fault act therefore turns solely on the appearance of a police patrol car.

The first stated purpose of the no-fault act is

[t]o relieve the severe economic distress of uncompensated victims of automobile accidents within this state by requiring automobile insurers to offer and automobile owners to maintain automobile insurance policies or other pledges of indemnity which will provide prompt payment of specified basic economic loss benefits to victims of automobile accidents without regard to whose fault caused the accident.

MinmStat. § 65B.42(1) (2000). A police patrol car, marked or unmarked, is an automobile. Application of the plain meaning of the statutory definition of “motor vehicle” to this case produces an absurd and unreasonable result that plainly departs from the first stated purpose of the no-fault act.

DECISION

When an injury arises out of the use of a marked police patrol car, applying the plain meaning of the statutory definition of “motor vehicle” to deny an injured person the right to basic economic-loss benefits produces an absurd and unreasonable result that plainly departs from the first stated purpose of the Minnesota No-Fault Automobile Insurance Act, Minn.Stat. §§ 65B.41-.71 (2000). The district court therefore erred by concluding that a marked police patrol car is not a “motor vehicle” for purposes of the no-fault act. Because both MSI and LMCIT’s policies provide the pedestrian with basic economic-loss benefits, we reverse and remand for the district court to determine the priority of payment of those benefits.

Reversed and remanded.


author: LANSING, Judge.

text:
    SETTLEMENT CAPITAL CORPORATION, Appellant, Jody Lee Lundgren, Appellant, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Respondent-below, Safeco Life Insurance Company, Respondent-below.
    No. C5-01-2051.
    Court of Appeals of Minnesota.
    July 2, 2002.

      John G. Westrick, Tammy L. Merkins, Westrick & McDowall-Nix, P.L.L.P., St. Paul, for appellant Lundgren.
    Lawrence P. Zielke, Shapiro & Nord-meyer, LLP, Edina, for appellant Settlement Capital Corp.
    Sean Simpson, Brian J. Slovut, Hinshaw & Culbertson, Minneapolis, for respondent State Farm Mut. Ins. Co.
    Considered and decided by LANSING, Judge, ANDERSON, Judge, and PORITSKY, Judge.

       Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.

   OPINION

LANSING, Judge.

Jody Lundgren is the payee under a structured minor settlement. When she reached 21 years of age, Lundgren sought permission from the district court under Minn.Stat. § 549.31 (2000), to allow her to transfer some of her structured-settlement payment rights in exchange for a lump-sum payment from Settlement Capital Corporation. The district court denied her petition. Because the undisputed facts show that Lundgren did not receive independent tax and financial advice, we affirm the denial.

FACTS

In 1986, when she was six years old, Jody Lundgren was involved in a car accident that caused permanent scars on her face and back and required stomach surgery. She settled her claims against the negligent parties and their insurer, State Farm Insurance Company, through a structured settlement funded by an annuity purchased by State Farm and issued by Safeco Insurance Company. The structured settlement provided that Lundgren would receive $1,000 monthly from August 20, 1998 (at age 18), through July 20, 2003; $750 monthly from August 20, 2003, to July 20, 2008; $800 monthly from August 20, 2008, through July 20, 2018; and $1,125 monthly from August 20, 2018, until her death. The terms of the structured settlement do not prohibit assignment.

When Lundgren turned 21 years old, she contacted Settlement Capital Corporation to inquire about transferring some of her structured-settlement payment rights in exchange for a lump-sum payment. Settlement Capital agreed to buy the payment rights from August 2001 through March 2011 in exchange for the lump sum of $50,615. Settlement Capital arrived at this figure by discounting the future payments to present value using the relatively high discount rate of 15.986%. As part of the transaction, Settlement Capital agreed to pay its own attorneys’ fees, attorneys’ fees incurred by Lundgren exceeding $1,500, and any brokerage fees exceeding $4,000. Settlement Capital furnished Lundgren the disclosure statement required under Minn.Stat. § 549.31.

Settlement Capital petitioned the district court under Minn.Stat. § 549.31 (2000) for authorization of the transfer. At the motion hearing, Lundgren was represented by her own attorney. In response to court questioning, Lundgren testified that she was satisfied with her attorney’s legal advice. Lundgren testified that she planned to use about $15,000 of the lump-sum payment to make a house down-payment she could not otherwise afford, about $11,500 to pay off a car loan, and the remainder to pay off miscellaneous bills and debts.

Lundgren testified that she holds a regular job in a group home for vulnerable adults and that her injuries from the 1986 car accident were scars that do not affect earning ability. She testified that the purchase of a house was in her best interests. She confirmed that she understood she was giving up her right to ten years of structured settlement payments; she also said that she understood the lump sum was significantly less than the total amount of the payments over time ($96,-600) and less than the present-day value of the payments ($73,291.15) using a much-lower, 6.2% discount rate published by the Internal Revenue Service.

The district court denied the petition, finding that the transfer was not in Lund-gren’s “best interests” because she had no immediate health emergency or other pressing need for money, the lump-sum payment was too deeply discounted, and Lundgren had not received independent advice on the tax and financial implications of the transfer. The district court also questioned whether the transfer might affect the tax consequences of the remaining unsold payments under the structured settlement. Lundgren and Settlement Capital Corporation appeal the district court’s denial of the petition.

ISSUES

I. Do the requirements of the transfer statute apply to a structured settlement that does not prohibit assignment?

II. Did the district court apply the proper statutory criteria in finding that the transfer was not in the best interests of Lundgren?

III. Did the district court err in finding that Lundgren did not receive advice on the tax and financial implications of the transfer?

ANALYSIS

The transfer of structured-settlement payment rights is governed by Minn.Stat. § 549.30-34 (2000). Under this statute, a transfer is effective only if a court of competent jurisdiction or responsible administrative authority has authorized it in advance. Minn.Stat. § 549.31, subd. 1. The transfer statute requires that a district court approving a transfer must make express written findings on certain aspects of the transfer, including that the payee has established that the transfer is in his or her “best interests” and has received independent professional advice “regarding the legal, tax, and financial implications” of the transfer. Id. at subd. 1(c), (d).

The transfer statute was enacted in response to the growing practice of injured persons selling their rights to future payments under a structured settlement in exchange for a lump-sum payment. At least 18 other states have enacted legislation requiring court approval of the transfer of structured-settlement payment rights. See Leo Andrada, Note, Structured Settlements: The Assignability Problem, 9 S. Cal. Interdisc. L.J. 465, 475 N. 32 (2000) (listing ten states, including Minnesota, that have enacted legislation requiring judicial approval for transfers of structured settlements); see also Del.Code Ann. tit. 10, § 6601 (Supp.2001); Fla. Stat. § 626.99296(3)(a) (2001); Idaho Code § 28-9-109(d)(13)(B)(iii) (Michie 2001); La.Rev.Stat. Ann. § 9:2715(B)(1) (West Supp.2001); Mass. Gen. Laws ch. 231C, § 2 (West Supp.2002); Mich. Comp. Laws Ann. § 691.1193, sec. 3 (West Supp.2002); Neb.Rev.Stat. § 25-3104(1) (Supp.2001); N.J. Stat. Ann. § 2A:16-66 (West.Supp. 2002); Ohio Rev.Code Ann. § 2323.583 (West 2000). One federal district court has upheld the Connecticut version of the statute — similar, but not identical, to Minnesota’s transfer statute — against a constitutional challenge under the Contracts Clause. Legal Asset Funding v. Travelers Cas. & Surety Co., 155 F.Supp.2d 90, 98-100 (D.N.J.2001) (recognizing potential vagaries of requiring court approval, but deferring to the “importance of the public purpose of the statute and the manner in which that purpose is being pursued”).

I

Settlement Capital and Lundgren first claim that the transfer statute only applies to the transfer of structured settlements that specifically prohibit assignment. The interpretation of a statute is a question of law, which we review de novo. Lolling v. Midwest Patrol, 545 N.W.2d 372, 375 (Minn.1996). We have not been provided with authority that would limit the scope of the statute, and we find no language in the statute that would so greatly constrict its terms.

The plain language of the statute establishes judicial oversight of the transfer that goes well beyond a cursory examination of the structured-settlement language allowing or prohibiting assignment. Kersten v. Minnesota Mut. Life Ins. Co., 608 N.W.2d 869, 874-75 (Minn.2000) (providing that when statutory language is plain and unambiguous, it manifests legislature’s intent, and appellate courts give statute its plain meaning). The first part of subdivision 1 plainly states that “[n]o direct or indirect transfer of structured settlement payment rights is effective * * * unless the transfer has been authorized in advance in a final order of a court of competent jurisdiction” based on express written findings. Minn.Stat. § 549.31, subd. 1. This statutory language is sufficient to vest power in a court to refuse to issue such an order if it cannot make the required statutory findings based on the evidence presented.

The second part of subdivision 1 vests the court with additional authority to allow the transfer even if the transfer would contradict the direct terms of the structured settlement. It provides:

If the transfer would contravene the terms of the structured settlement, upon the filing of a written objection by any interested party and after considering the objection and any response to it, the court or responsible administrative authority may grant, deny, or impose conditions upon the proposed transfer as the court or responsible administrative authority deems just and proper under the facts and circumstances in accordance with established principles of law.

Id. Thus, the court is arguably empowered to override an anti-assignment clause, but the statute is not restricted to that circumstance.

Under its plain language, the transfer statute applies to any transfer of structured-settlement rights, not just the transfer of structured settlements that forbid assignment.

II

Settlement Capital and Lundgren also claim the district court erred in finding the transfer was not in the “best interests” of Lundgren. In particular, they allege that the district court erred in relying on the fact that Lundgren had not demonstrated an immediate health emergency that would require money.

Under the statute, if a court authorizes transfer, it must make “written express findings” that, among other things, “the payee has established that the transfer is in the best interests of the payee and the payee’s dependents." Minn.Stat. § 549.31, subd. 1(c). Unfortunately, the statute does not define “best interests.” See Minn.Stat. § 549.30 (defining 19 terms in the transfer statute, but not defining “best interests”).

Lundgren and Settlement Capital do not dispute the facts that underlie the determination of best interests. Thus, we are essentially reviewing the district court’s “weighing statutory criteria in light of the found basic facts.” Maxfield v. Maxfield, 452 N.W.2d 219, 221 (Minn.1990). We may correct erroneous applications of the law that factor into the ultimate issue of whether the transfer is in the best interests of Lundgren' and her dependents. Id.

In the absence of a definition of best interests, the district court faces a daunting challenge in determining whether the transfer was in Lundgren’s best interests. The court carefully analyzed the transaction and pointed out that the net amount of money Lundgren would receive under the transaction would be approximately $45,115. The payments under the original settlement would amount to $96,600 over the ten-year period that Lundgren proposes to transfer. Thus Lundgren would receive substantially less than half of the original structured settlement payments. The -district court also took into account the purpose of structured settlements — to insulate injured persons from pressures to squander personal injury settlements which would leave them unable to provide for their lifetime needs. This purpose and the right of a competent adult to choose how to manage his or her own financial affairs imposes a tension that must be resolved by attempting to draw a reasonable meaning of best interests from all provisions of the transfer statute and from other statutes that include a best interests standard. See Wong v. Am. Family Mut. Ins. Co., 576 N.W.2d 742, 745 (Minn.1998) (discerning meaning of legislative words and phrases through connection to other associated words and phrases).

First, we agree with Lundgren’s argument that confining best interests to immediate health emergencies or other emergency circumstances may too narrowly define best interests. Our reluctance to confine best interests to narrow emergency circumstances is supported by the legislative history of the transfer statute. Several versions of the transfer statute originally introduced in the house and senate required that the payee demonstrate “imminent financial hardship” before the transfer could be approved. See S.F. 148 (1999); H.F. 478 (1999); S.F. 640 (1999); H.F. 771 (1999). This language requiring proof of “imminent financial hardship” was removed from the bill that' was finally enacted; instead, the language used in its place was “best interests.” Minn.Stat. § 549.31, subd. 1(c). The Minnesota legislature’s decision to use the less-restrictive language is in line with several other states that have enacted a transfer statute. See, e.g., Conn. Gen.Stat. § 52-225f(c)(l) (transfer must be in best interests of payee and fair and reasonable to all interested parties); Fla. Stat. § 626.99296(3)(a)3 (transfer must be in best interests of payee taking into account the welfare and support of their dependents); Neb.Rev.Stat. § 25-3104(l)(c) (transfer must be in best interests of payee); Ohio Rev.Code Ann. § 2323.583(B)(1) (transfer must be fair and reasonable and in best interests of payee and payee’s dependents).

We believe that the best interests determination involves a more global consideration of the facts, circumstances, and means of support available to the payee and his or her dependents. These considerations would include, among other case specific factors, the reasonable preference of the payee, in light of the payee’s age, mental capacity, maturity level, and stated purpose for the transfer. See, e.g., Minn. Stat. § 518.17, subd. 1(2) (2000) (including reasonable preference of a child of sufficient age as factor to be considered in determining best interests of child); Minn. Stat. § 525.539, subd. 7 (2000) (including reasonable preference of a ward with sufficient capacity to express a preference as factor to be considered in determining best interests of ward).

The factors for consideration should also include whether the periodic payments of the structured settlement were intended to cover future income'loss or future medical expenses. If so, the district court should inquire whether the payee has means of support aside from the structured settlement to meet these obligations. See, e.g., Minn.Stat. § 549.25(1) (2000) (requiring district court to hold hearing if injured person receives jury verdict for future damages exceeding $100,000 to consider if structured settlement would permit injured person to meet obligations likely to be incurred in the future). The district court should also consider whether the offered discount rate is in line with the market rate for similar transfers. The discount rate used by Settlement Capital for this transfer is, on its face, relatively high, but not illegal, and also takes into account the payment of various fees that Lundgren might otherwise incur. The legislature has not provided a specific limit on the discount rate for such a transaction. Finally, the district court should consider whether the transfer is in the best interests of the payee’s dependents; we believe this may involve an assessment -of whether the payee can meet the financial needs of and obligations to the payee’s dependents if the transfer is allowed to proceed.

We conclude that the criteria the district court applied to its consideration of whether the transfer was in the best interests of Lundgren and her dependents was too narrow. Lundgren is 21 years old and has no cognitive -disabilities; she is married and has two children; she and her spouse have regular employment; her injuries from the car accident are primarily scars and do not affect her ability to earn income; she intends to use part of the lump-sum payment for a house down-payment she could not secure any other way; she understood the terms of the transfer and the use of the high discount rate for these transfers; and the high discount rate is standard for these transfers of structured settlemepts in a secondary market. No evidence suggested that Lundgren was unable to support her two children in the absence of the structured-settlement payments. Under these facts, we conclude that Lundgren has made a sufficient showing that the transfer is in her and her children’s best interests.

III

Settlement Capital and Lundgren also claim the district court erred in suggesting Lundgren would suffer adverse tax consequences from the transfer. The transfer statute requires not only that the payee establish that the transfer is in the payee’s best interests, but also that the payee has received independent advice on tax and financial implications. Minn.Stat. § 549.30, Subd. 6. Thus, this issue involves interpretation of the transfer statute, which we review de novo. Lolling, 545 N.W.2d at 375. Factual findings will not be overturned unless clearly erroneous. Minn. R. Civ. P. 52.01.

The transfer statute requires the court to make an express written finding that “the payee has received independent professional advice regarding the legal, tax, and financial implications of the transfer.” Minn.Stat. § 549.31, subd. 1(d). Independent professional advice means:

[T]he advice of an attorney, certified public accountant, actuary, or other professional advisor: (1) who is engaged by a payee to render advice concerning the legal, tax, and financial implications of a transfer of structured settlement payment rights; (2) who is not in any manner affiliated with or compensated by the transferee of the transfer; and (3) whose compensation for providing the advice is not affected by whether a transfer occurs or does not occur.

Minn.Stat. § 549.30, subd. 6.

The district court found that Lund-gren failed to show that she was given independent tax or financial advice. This factual finding is supported by the record. In the motion transcript, Lundgren did not establish she had received the required advice. In addition, the record is devoid of any evidence that Lundgren obtained this advice. Under the plain language of the statute, in the absence of the required independent advice, the district court properly declined to approve the transfer. Once Lundgren has obtained the required independent tax and financial advice, she is free to petition for transfer a second time. This advice does not require an advisory opinion from the IRS or a court ruling on whether the transfer would affect the tax-free status of the remaining payments. Under the statute, the district court need not ensure that the transfer not affect the tax-free status of the remaining payments; instead, the district court simply must find that Lundgren has received independent tax and financial advice on the effect of the transfer.

DECISION

The payee has demonstrated that the transfer is in her and her dependents’ best interests. But because the payee has not demonstrated that she received independent tax and financial advice on the effect of the transfer, we affirm the order of the district court. Once the payee has obtained the statutorily required independent advice, the payee is free to petition the district court for approval of the transfer.

Affirmed.

      . Present value is the sum of money that would, with compound interest, amount to a specific sum on a specific future date, or put another way, the future value of the money discounted to today’s value. Black’s Law Dictionary 1203 (7th ed.1999). The higher the discount rate used to calculate the present value, the smaller the present value sum will be.


author: HANSON, Judge.

text:
    STATE of Minnesota, Respondent, v. Robin Lee STILLDAY, Appellant.
    No. C3-01-1495.
    Court of Appeals of Minnesota.
    July 9, 2002.

      Mike Hatch, Attorney General, St. Paul, and James C. Backstrom, Dakota County Attorney, Mikkel A. Long, Assistant County Attorney, Hastings, for respondent.
    John M. Stuart, State Public Defender, Rochelle R. Winn, Assistant Public Defender, Minneapolis, MN, for appellant.
    Considered and decided by HALBROOKS, Judge, KLAPHAKE, Judge, and HANSON, Judge.
   OPINION

HANSON, Judge.

On appeal from convictions of pattern of harassing conduct and fifth-degree assault, appellant argues that the district court erred by (1) allowing the state to offer inflammatory testimony about a prior act, despite appellant’s willingness to stipulate to a prior conviction of terroristic threats against the victim’s son in connection with that act; (2) refusing to strike opinion testimony on the battered-woman syndrome by a police officer who was not qualified as an expert on that subject; (3) admitting evidence of the victim’s out-of-court statement, requesting help; and (4) using the terroristic threats conviction to determine appellant’s criminal history score for sentencing when the conviction was also relevant to one of the acts used to establish a pattern of the harassing conduct. We affirm.

FACTS

Appellant Robin Lee Stillday, a/k/a Robin Desjarlait, dated and lived with P.B. intermittently over a twenty-year period. At times, when the two binged on alcohol, Stillday would physically assault P.B.

Stillday and P.B. drank throughout the day of February 3, 2001, when Stillday became angry and punched P.B. in the face several times. P.B. lost consciousness and was alone when she awoke. Jason Engel, P.B.’s upstairs neighbor who had heard a loud noise coming from P.B.’s apartment, knocked on P.B.’s door and heard her say “[h]elp. Call nine-one-one.” Police officers responded to the report of a “physical domestic” situation at P.B.’s apartment. The officers found P.B. crying in the common area of her apartment building.

Stillday was charged with fifth-degree assault, in violation of Minn.Stat. § 609.224, subd. 1(2) (2000), and pattern of harassing conduct, in violation of Minn. Stat. § 609.749, subd. 5 (2000). The pattern of harassing conduct charge was based on the events of February 3, 2001, and three prior incidents of domestic violence occurring on February 13,1999, September 18, 2000, and November 9, 2000. The prior incident on February 13, 1999, had resulted in Stillday’s conviction of ter-roristic threats.

At trial, Stillday offered to stipulate to his conviction of terroristic threats in connection with the February 13, 1999, incident and sought to preclude any testimony regarding the underlying events of that conviction as being unduly prejudicial. Despite Stillday’s offer, the district court allowed the state to introduce evidence of that incident, through the testimony of P.B., her son and two police officers who arrived at the scene, and through four photographs taken at the scene.

During the trial Police Officer Gary Lid-ster testified as a lay witness about domestic violence and his experiences dealing with battered women. Without objection by Stillday, he stated that it was not unusual for victims of domestic violence to delay seeking an order for protection, explaining:

It takes women different stages before they’re ready to finally pack up and leave. They desperately want the relationship to continue. They just want the violence to stop.
In a lot of cases that doesn’t happen, and a lot of gals are willing to give it a second or third chance before they’ll finally try and extricate themselves from that situation.

On cross-examination, Stillday inquired further of Officer Lidster on the difficulty of convincing victims to prosecute for domestic violence. After the noon recess, Stillday moved the court to strike Officer Lidster’s testimony because the state had not provided notice that Officer Lidster would be “testifying as an expert witness on women’s abuse issues, domestic assault issues, order for protection issues * * The district court denied the motion to strike, but gave a cautionary instruction, which stated in part as follows:

The State of Minnesota did not call Officer Lidster as an expert in the field of what perhaps can be referred to as the battered women’s syndrome. The jury can listen to the testimony and weigh it based upon the qualifications and the information that they have heard from Officer Lidster but should not take his testimony as being an expert witness in the field I’ve referred to.

Police Officer Dawn Johnson testified about her interview with P.B. regarding the facts of the September 18, 2000, incident.

The jury found Stillday guilty as charged. The district court sentenced Stillday to a 38-month imprisonment after considering Stillday’s 1999 terroristic threats conviction when determining his criminal history score. This appeal followed.

ISSUES

1. Did the district court err by admitting evidence of the facts underlying Stillday’s prior conviction for terror-istic threats, when Stillday agreed to stipulate to his conviction?

2. Did the district court err by allowing the police officer to testify as a lay witness about battered-woman syndrome?

3. Did the district court err by admitting evidence of an out-of-court statement by the victim?

4. Did the district court erroneously calculate appellant’s sentence?

ANALYSIS

We defer to the district court’s evidentiary rulings and will not overturn them absent a clear abuse of discretion. State v. Kelly, 435 N.W.2d 807, 813 (Minn.1989). Similarly, we will not reverse the district court’s determination of a defendant’s criminal history score absent an abuse of discretion. Bolstad v. State, 439 N.W.2d 50, 53 (Minn.App.1989).

I

Stillday argues that the district court abused its discretion by allowing evidence of the details of the February 13, 1999, incident in the face of Stillday’s pretrial offer to stipulate to his conviction of terroristic threats as a result of that incident. As Stillday acknowledges, a criminal defendant’s offer to stipulate does not necessarily eliminate the state’s right to offer evidence on the subject, especially where the evidence has relevance beyond the stipulation. See State v. Davidson, 351 N.W.2d 8, 10 (Minn.1984) (stating “[t]he reason for the general rule is that a defendant should not be able to unilaterally control the issue of the need for relevant evidence by offering to stipulate * * *.”). Therefore, the district court has discretion to permit the state to present evidence of the underlying facts. See, e.g., State v. Durfee, 322 N.W.2d 778, 785-86 (Minn.1982) (deciding that the district court did not err by allowing proof of the victim’s injuries, including photographs regardless of defendant’s offer to stipulate); State v. Barsness, 473 N.W.2d 325, 328 (Minn.App.1991) (holding that the state was not required to accept a stipulation on the cause of an infant’s death and could present photographs and videotape relevant to the issue), review denied (Minn. Aug. 29, 1991).

An exception to this general rule has been made when the potential for unfair prejudice substantially outweighs the probative value of the evidence underlying a conviction and the stipulation supplies all of the relevant information on the subject. See State v. Berkelman, 355 N.W.2d 394, 397 (Minn.1984) (holding that in gross misdemeanor DWI prosecution, the district court should have accepted defendant’s offer to stipulate to a prior conviction); State v. Davidson, 351 N.W.2d 8, 11 (Minn.1984) (stating that the court should allow a defendant to stipulate to being a convicted felon during a trial for being a felon in possession of a handgun); State v. Clark, 375 N.W.2d 59, 62 (Minn.App.1985) (holding that defendant charged with aggravated DWI was permitted to avoid introduction of evidence regarding his license revocation by stipulating to his prior offenses).

■ The United States Supreme Court decision relied upon by Stillday, Old Chief v. United States, 519 U.S. 172, 117 S.Ct. 644, 136 L.Ed.2d 574 (1997), is consistent with this exception. The Supreme Court decided, in a trial for possession of a handgun by a felon, that it was an abuse of discretion to admit evidence of the facts underlying the felony conviction when the defendant offered to stipulate to the conviction and the only relevance of the conviction was to show the defendant’s status as a felon. Id. at 190-91, 117 S.Ct. at 654-56, 136 L.Ed.2d 574. But Old Chief, and the other cases recognizing this exception, involve the situation where only the defendant’s status is at issue and the stipulation establishes that status without any evidence of the underlying facts. Id. at 183, n. 7, 117 S.Ct. at 651, n. 7, 136 L.Ed.2d 574.

We conclude that the exception does not apply here, and that the district court did not abuse its discretion by allowing evidence of the facts of the February 13, 1999, incident, for two independent reasons.

First, the conviction of Stillday does not provide all of the information about the prior act that is relevant to the crime of a pattern of harassing conduct. That crime is defined as follows:

a) A person who engages in a pattern of harassing conduct with respect to a single victim or one or more members of a single household which the actor knows or has reason to know would cause the victim under the circumstances to feel terrorized or to fear bodily harm and which does cause this reaction on the part of the victim, is guilty of a felony and may be sentenced to imprisonment for not more than ten years or to payment of a fine of not more than $20,000, or both.
b) For purposes of this subdivision, a “pattern of harassing conduct” means two or more acts within a five-year period that violate the provisions of any of the following [qualifying criminal charges].

Minn.Stat. § 609.749, subd. 5 (2000) (emphasis added). Stillday’s offer to stipulate to his conviction does not provide all of the information relevant to the crime because, by itself, it would not necessarily enable the jury to determine whether Stillday knew or should have known that the incident would cause P.B. “to feel terrorized or to fear bodily harm” or whether P.B. did have “this reaction.”

Second, the conviction to which Stillday offered to stipulate was for terroristic threats to P.B.’s son, while the underlying incident included a separate assault of P.B. Thus, again, the conviction did not provide all of the evidence about the incident that was relevant to the crime charged.

In connection with the February 13, 1999, incident, the district court admitted, in addition to the testimony of P.B., the testimony of the two officers about what they encountered at the scene and what P.B. told them, as well as photographs of bloodstains within the apartment. Stillday argues that this additional evidence was duplicative, and unfairly prejudicial, because P.B. had already testified about the incident. But the district court allowed the evidence because it corroborated P.B.’s testimony and P.B.’s credibility was at issue in this case. The district court did not abuse its discretion to determine the scope of the testimony to be allowed on this incident.

II

Stillday argues that the district court erred by not striking Officer Lid-ster’s lay-witness testimony about the characteristics of battered women. The state agrees that Officer Lidster was not an expert witness, but argues that his testimony was admissible as that of a lay witness pursuant to Minn. R. Evid. 701. The testimony of a lay witness, who does not testify as an expert

is limited to those opinions or inferences which are (a) rationally based on the perception of the witness and (b) helpful to a clear understanding of the witness’ testimony or the determination of a fact in issue.

Minn. R. Evid. 701.

Officer Lidster testified about his qualifications for dealing with domestic violence and training with domestic violence issues, about domestic violence in general, and about the characteristics of battered women and why they might delay in seeking help. Stillday did not object to this testimony when it was given and, in fact, asked related follow-up questions on cross-examination. Under the circumstances, the district court’s decision to deny Stillday’s motion, and to provide a curative instruction that Officer Lidster was not an expert, was not an abuse of discretion. Moreover, any error in not striking the testimony of Officer Lidster would be harmless. The testimony did not significantly affect the outcome of the case, especially in light of the other evidence admitted. See State v. Post, 512 N.W.2d 99, 102 n. 2. (Minn.1994).

Ill

In his pro se brief, Stillday argues that the testimony of Officer Johnson and Jason Engel included inadmissible hearsay statements.

Officer Johnson’s Testimony

Stillday objected to Officer Johnson’s testimony about what P.B. told her when she interviewed P.B. after the September 18, 2000 incident. P.B.’s statement was about Stillday’s abuse of her a few days earlier. Officer Johnson testified as follows:

Q. Okay. Did she tell you she had been assaulted?
A. Yes.
Q. Who did she say assaulted her?
[STILLDAY’S ATTORNEY]: Objection. Hearsay.
THE COURT: Overruled. You may answer, officer.
THE WITNESS: Her boyfriend, Robin Desjarlait was the name that she gave.

The district court ruled that the officers’ testimony was admissible as a prior consistent statement because Stillday challenged P.B.’s credibility. Prior consistent statements are not considered hearsay if the declarant testifies at the trial and is subject to cross-examination about the statement, and the consistent statement is “helpful to the trier of fact in evaluating the declarant’s credibility as a witness.” Minn. R. Evid. 801(d)(1). The district court did not abuse its discretion in admitting Officer Johnson’s testimony of P.B.’s prior consistent statement because P.B.’s credibility was at issue.

Engel’s Testimony

Stillday did not object to Engel’s testimony that he heard P.B. say “[h]elp. Call nine-one-one.” Thus, we may' consider Stillday’s argument only if the admission of the evidence was plain error or a defect affecting substantial rights of Still-day. Minn. R.Crim. P. 31.02. To establish plain error, Stillday must show that the district court’s ruling was erroneous, the error was plain, and the error affected his substantial rights. See State v. Griller, 583 N.W.2d 736, 740 (Minn.1998) (setting out three-prong test).

Stillday has not shown that the district court abused its discretion by allowing this testimony in evidence. First, this out-of-court statement was not hearsay, both because it was not an assertion of a fact and it was not offered to prove the truth of the matter asserted. See Minn. R. Evid. 801(c) (defining hearsay). Instead, it was only a statement that P.B. needed help and it was offered to show why Engel contacted the police. Second, even if this statement had been hearsay, it would be admissible under either the “excited utterance” or the “then existing mental, emotional, or physical condition” exceptions to the hearsay rule. See Minn. R. Evid. 803(2) and (3).

IV

Stillday argues that his sentence for a pattern of harassing conduct should be based on a criminal history score of three because his terroristic threats conviction, in connection with the incident of February 13, 1999, was already considered as an element of the pattern offense and it would be duplicative to also use it to calculate his sentence.

Minn. Sent. Guidelines II.B.6 provides:

When determining the criminal history score for a current offense that is a felony solely because the offender has previous convictions for similar or related offenses, the prior conviction(s) upon which the enhancement is based may be used in determining custody status, but cannot be used in calculating the remaining components of the offender’s criminal history score.

(Emphasis added.)

It is unclear whether this guideline applies to a conviction of a pattern of harassing conduct under Minn.Stat. § 609.749, subd. 5, because guilt depends on prior “acts,” not on prior “convictions.” In any event, Stillday’s conviction of a pattern of harassing conduct can be supported solely by the evidence of three prior acts of harassing conduct toward P.B., without any evidence concerning Stillday’s terroristic threat toward P.B.’s son. Accordingly, the district court did not abuse its discretion by including the conviction in the calculation of Stillday’s criminal history score.

DECISION

The district court did not abuse its discretion in allowing the state to prove the underlying facts concerning an incident of harassing conduct toward P.B. despite Stillday’s offer to stipulate to his conviction of terroristic threats to P.B.’s son, arising from, the same incident. The district court did not commit prejudicial error in any of its evidentiary rulings. Finally, the district court did not abuse its discretion by using the conviction of terroristic threats to determine Stillday’s criminal history score.

Affirmed.


author: RANDALL, Judge.

text:
    STATE of Minnesota, Respondent, v. Randal David SIMMONS, Appellant.
    No. C2-02-25.
    Court of Appeals of Minnesota.
    July 9, 2002.

      John M. Stuart, State Public Defender, Jodie L. Carlson, Assistant Public Defender, Minneapolis, for appellant.
    Mike Hatch, Attorney General, St. Paul, MN, and Doug Johnson, Washington County Attorney, Eric C. Thole, Assistant County Attorney, Stillwater, for respondent.
    Considered and decided by RANDALL, Presiding Judge, STONEBURNER, Judge, and HUSPENI, Judge.

       Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.

   OPINION

RANDALL, Judge.

After a guilty plea, appellant was found guilty of theft by swindle in violation of Minn.Stat. §§ 609.52. subd. 2(4), 609.52 subd. 3(1), 609.05 (2000) and was sentenced to 171 months in prison. Appellant appeals his conviction arguing (1) the district court abused its discretion when it imposed a triple upward departure without stating reasons for the departure, and (2) the district court engaged in judicial misconduct when it personally attacked appellant, and among other statements, called him immoral. We affirm as modified, reducing appellant’s sentence to 114 months, a double departure'

FACTS

Appellant was charged with aiding and abetting theft by swindle, offering a forged check, and check forgery over $35,000. Between September 2000 and January 2001, appellant and eight other individuals purchased 21 vehicles from unsuspecting people and a dealership using counterfeit checks. The victim’s total loss was in excess of $310,000, and the court ordered restitution in the amount of $314,111.44.

While conducting the car flipping scam, appellant and eight others created false identifications and checks. Appellant arranged meetings, sales and purchases of the vehicles, gave rides to the victims, made false checks and identifications and test drove the vehicles that would be stolen. Appellant admitted at sentencing that he and his brother were the ringleaders of the operation.

In July 2001, as part of a plea agreement, appellant pleaded guilty to one count of theft by swindle in an amount over $35,000 in violation of Minn.Stat. §§ 609.52. subd. 2(4), 609.52 subd. 3(1), 609.05 (2000), and the remaining counts were dismissed. The plea agreement contained no recommendation as to sentencing. Theft by swindle is a level six offense. Appellant is 38 years old, has eleven points on the criminal history score from 16 prior convictions between 1984 and 1997. The presumptive sentence is 57-months’ commitment to the commissioner of corrections. At the sentencing hearing, the prosecutor argued for a triple departure and appellant argued for the presumptive sentence.

The district court imposed a triple upward departure and sentenced appellant to 171 months. The court, while imposing sentence, commented on appellant’s lengthy criminal history, the high degree of planning of the operation, the impact on the victims, and the amount involved in the charged crime.

Appellant challenges the sentence, arguing that the district court abused its discretion in imposing a triple upward departure without stating specific reasons for the departure, and engaged in judicial misconduct when it personally attacked appellant, calling him immoral.

ISSUES

I. Did the district court abuse its discretion when imposing a triple upward departure without stating any grounds on the record?

II. Did the district court abuse its discretion and engage in misconduct, when it personally attacked appellant at sentencing?-

ANALYSIS

I. Upward departure

Appellant first challenges the district court’s imposition of a 171 month sentence for theft by swindle, arguing that the sentence is three times the 57-month presumptive sentence. Appellant asserts that the district court abused its discretion by imposing the sentence, claiming the district court failed to provide written reasons for the departure and the district court’s verbal soliloquy demonstrated bias. Respondent maintains that the sentencing departure is supported by the record, because (a) the crime was a major economic crime; (b) there were multiple victims; (c) the crime was one of major planning; and (d) appellant was a career criminal with 16 previous felony convictions. Respondent asserts that the district court’s remarks were harmless error and the record supports the triple upward departure.

A sentencing court has broad discretion to depart only if substantial and compelling aggravating or mitigatin¿ circumstances are present. State v. Best, 449 N.W.2d 426, 427 (Minn.1989). A sentencing court “shall use the presumptive sentence unless the individual case involves substantial and compelling circumstances.” State v. Garcia, 302 N.W.2d 643, 647 (Minn.1981) (quotation omitted). Substantial and compelling circumstances are those making the facts of á particular case either more or less serious than a typical case involving the same crime. State v. Allen, 482 N.W.2d 228, 231 (Minn.App.1992), review denied (Minn. Apr. 13, 1992).

Generally, when an upward dura-tional sentencing departure is warranted, the limit is double the presumptive sentence length. State v. Evans, 311 N.W.2d 481, 483 (Minn.1981). There may be rare cases where severe aggravating circumstances exist that would justify a greater-than-double departure up to the statutory maximum of the offense for which a defendant was convicted. Id. Such a decision “must be based on our collective, collegial experience in reviewing a large number of criminal appeals from all the judicial districts.” State v. Norton, 328 N.W.2d 142, 146-47 (Minn.1982).

Appellant pleaded guilty and was convicted of and sentenced for theft by swindle over $35,000 in violation of Minn. Stat. §§ 609.52. subd. 2(4), 609.52 subd. 3(1), 609.05. Appellant engaged in a “car flipping” scam involving 22 vehicles and $310,000 dollars. Minn.Stat. § 609.52. subd. 2(4) provides:

Whoever does any of the following commits theft [] may be sentenced as provided in subdivision 3 * * * by swindling, whether by artifice, trick, device, or any other means, obtains property or services from another person.

The district court imposed an executed prison term of 171 months. Under the Minnesota Sentencing Guidelines, theft by swindle is a severity level 6 offense. Appellant’s criminal history score is 11, which results in a presumptive sentence of 57 months. The district court’s remarks during sentencing demonstrate three aggravating factors for imposing the triple upward departure: (1) appellant’s status as a career offender with an extensive criminal past; (2) the impact on the victims; (3) appellant’s position of trust; and (4) it was a group crime.

Although the district court did not state detailed findings explaining its upward departure, the record, taken as a whole, supports some departure upward from the presumptive sentence. See Williams v. State, 361 N.W.2d 840, 844 (Minn.1985) (stating a departure will be affirmed if there is sufficient record evidence to support departure).

The Minnesota Sentencing Guidelines provide a list of aggravating factors that justify an upward durational departure. The guidelines recognize a departure for a major economic offense when two or more of the following are present:

(a) the offense involved multiple victims or multiple incidents per victim; (b) the offense involved an attempted or actual monetary loss substantially greater than the usual offense, or substantially greater than the minimum loss specified in the statutes; (c) the offense involved a high degree of sophistication or planning, or occurred over a lengthy period of time; (d) the defendant used his or her position or status to facilitate the commission of the offense, including positions of trust, confidence or fiduciary relationships; or (e) the defendant had been involved in other conduct similar to the current offense as evidenced by the findings of civil or administrative law proceedings or the imposition of professional sanctions.

Minn. Sent. Guidelines IID.2.b(4) (2000). A major economic offense is defined as “an illegal act or series of illegal acts committed by other than physical means and by concealment or guile to obtain money or property!!]” Id

The record demonstrates that the crime that appellant committed involved: (a) multiple incidents; (b) a monetary loss substantially greater than the statutory minimum, $168,000 as compared to $35,000; and (c) a high degree of sophistication and planning; over 22 vehicles and 22 transactions were involved.

The total dollar amount of appellant’s scheme was over $310,000 and it was within the district court’s discretion to depart upward. Minn.Stat. § 609.52, subd. 3(1) provides for a sentence of not more than 20 years if the value of the stolen property exceeds $35,000 and if the conviction is for a violation of subdivision 2(4). This case meets the statutory guidelines for a possible increased sentence due to the value of the property. The record shows that three individuals suffered losses totaling $48,400 that were not covered by insurance. Wells Fargo honored a counterfeit check for $12,500, two other individuals bought vehicles from appellant totaling $13,700, and car dealerships suffered losses of $9,503. The court ordered appellant to pay restitution in the amount of $314,111.44 to cover monetary losses.

The record supports a determination that the offense involved a high degree of sophistication and planning. Appellant’s crime occurred over a period of months between September 2000 and January 2001. Eight other people were involved in the scheme. False Minnesota driver’s licenses and cashier and personal checks were created and used during the scheme.

An upward departure can be considered because appellant is a career offender. Minnesota law provides for increased sentences for offenders who commit a sixth felony.

Whenever a person is convicted of a felony, and the judge is imposing an executed sentence based on a sentencing guidelines presumptive imprisonment sentence, the judge may impose an aggravated durational departure from the presumptive sentence up to the statutory maximum sentence if the judge finds and specifies on the record that the offender has five or more prior felony convictions and that the present offense is a felony that was committed as part of a pattern of criminal conduct.

Minn.Stat. § 609.1095, subd. 4 (2000).

Appellant’s sixteen previous felony convictions support a finding that appellant has engaged in a pattern of criminal conduct. A pattern of criminal conduct may be demonstrated by “criminal conduct similar, but not identical, in motive, purpose, results, participants, victims or other shared characteristics.” State v. Gorman, 546 N.W.2d 5, 9 (Minn.1996). The sentencing court may consider prior felony and gross misdemeanor convictions as well as uncharged acts of criminal conduct proved by clear and convincing evidence in determining whether a criminal pattern exists. At the sentencing hearing, the district court listed appellant’s lengthy criminal history between 1984 and 1997, and stated:

And so your record shows that you have used what intelligence you have to criminal purposes all our life. Sixteen I think was the number of convictions? ⅝ * ⅝ Controlled substance, Dakota County, Washington County, '97; receiving stolen property, Todd County; controlled substance, Ramsey County; check forgery, McLeod County; burglary, Chisa-go County; simple robbery, Ramsey County; receiving stolen property, Ramsey County; unauthorized use of a motor vehicle, Ramsey County; burglary, Wright County; aggravated robbery, Washington County, that goes back to '84; and simple robbery in Ramsey County going back to '84.

Appellant began his criminal career when he turned 18 and has been arrested more than 30 times. Taking into account facts in the record and the above discussed aggravating factors, the district court did not abuse its discretion when it imposed on appellant an upward durational departure commitment to the commissioner of corrections. However the analysis does not stop with the issue of an upward departure; the next issue we must consider is how much of a departure is appropriate.

II. Bias

Appellant argues that the judge’s remarks during sentencing demonstrated bias and contributed to the triple upward departure which he received. We agree. Judges are expected to conform to a high standard of conduct. Canon 1 of the Code of Judicial Conduct imposes this standard “in order to preserve the integrity and independence of the judiciary.” Minn. Code Jud. Conduct, Canon 1. Under Canon 2A, Judges must “respect and comply with the law and act at all times in a manner that promotes public confidence in the integrity and impartiality of the judiciary.” Minn.Code of Jud. Conduct, Canon 2A.

At sentencing, the district court .stated to appellant:

The person who’s a con man has the ability to do things at that level but is basically — and the Board on Judicial Standards told me I can’t use this word as a judge but I’ll use it anyway because they’re wrong — immoral. You are immoral. Completely unequivocally immoral. And the Board is wrong when they say judges can’t use that term and they’ve told me that to my face. But I’m a free American and I can say what I please.
You are immoral. Your record reflects that you are immoral and that is the correct term. Although that belittles people, I’m told, you need to be belittled, because you are. And what you’ve done to these people here, you know 20 years from now they won’t forget this.

The court went on to state:

You operate on a smaller scale, but you’re no different, you may not be a religious fanatic, you’re no different than the people who took down the World Trade Center. You’re organized, you can put things together, can trick people. You can use their good will against them and pull off something, and you’ve done it. So as far as criminal activity goes you’re very good at it. But that’s not a compliment, all right? So you serve the time in prison and I hope the feds have the time to carry out their prosecution against you.

The district court’s remarks during sentencing were inappropriate. No further discussion is needed.

Notwithstanding the court’s comments, the record supports the upward departure. Appellant cites to an unpublished case, State v. Mitchell, No. C8-97-2040, 1998 WL 100603 (Minn.App. Mar.10, 1998), review denied (Minn. Apr. 14, 1998), for the proposition that the trial court did not cite the reasons for the departure, but rather engaged in personal attacks and, thus, the sentence should be set aside. In Mitchell, this court noted that although the district court’s observations did not carefully apply the applicable legal factors, the error was harmless because the district court’s comments included proper aggravating factors. The court, in Mitchell, stated that although the

trial court permitted the appearance of acting on emotion and dispensing with the rule of the law * * * the error of the court does not displace the rationale it announced for revoking appellant’s probation.

Id at 2.

The court further stated,

the trial court’s inflammatory remarks represent a more plausible judicial response when viewed in light of the seriousness of appellant’s 1994 crime and the continuing threat appellant is to himself and others if he fails to completely correct the behavior that led to his original offense, reasons that comply with the mandate of Austin.

Id.

Mitchell is instructive. In this case the district court did not specifically articulate all findings for departure, but its remarks included reference to appellant’s criminal career and prior record. Absent the personal remarks, the uncontested record forms the basis for our affirming a sentence with an upward durational departure. However, it is clear from the judge’s comments that appellant was denied an unbiased decision-maker at sentencing. See McKenzie v. State, 588 N.W.2d 744, 747 (Minn.1998) (stating criminal defendant entitled to impartial tribunal). On the other hand, it is equally clear from the record that legitimate reasons to support an upward departure were present. We affirm on the issue of whether the record supports an upward durational departure, but we modify the upward departure down to double the presumptive length. See Evans, 311 N.W.2d at 483 (determining that generally an upward durational departure is double the presumptive length). Appellant’s sentence is modified downward to a 114-month commitment.

DECISION

The district court’s comments at sentencing denied appellant an impartial and unbiased hearing. The record does contain sufficient legitimate reasons to justify a double upward durational departure.

Affirmed as modified.


author: SANDSTROM, Justice.

text:
    2002 ND 105
    STATE of North Dakota, Plaintiff and Appellee, v. Michael Darnell JACKSON, Defendant and Appellant.
    Nos. 20010298, 20010299.
    Supreme Court of North Dakota.
    July 11, 2002.
    Lisa K. Fair McEvers, Assistant State’s Attorney, Fargo, ND, for plaintiff and ap-pellee; submitted on brief.
    Richard E. Edinger, Fargo, ND, for defendant and appellant; submitted on briefs.
   SANDSTROM, Justice.

[¶ 1] Michael Darnell Jackson appeals from two East Central Judicial District Court judgments of conviction for failure to register as a convicted sex offender in violation of N.D.C.C. § 12.1-32-15, alleging he was denied the effective assistance of counsel because his trial attorney did not move for a judgment of acquittal, under N.D.R.Crim.P. 29(a).

[¶ 2] The issue of ineffective assistance of counsel is best raised in a post-conviction relief proceeding, except in rare cases. State v. Norman, 507 N.W.2d 522, 525 (N.D.1993) (a claim of ineffective assistance of counsel should generally be raised in a post-conviction proceeding). This is a rare ease.

[¶ 3] We hold, as a matter of law, it is not ineffective assistance for counsel to fail to move for a judgment of acquittal, under N.D.R.Crim.P. 29(a), when the prosecution has presented a prima facie case. State v. Kroeplin, 266 N.W.2d 537, 543 (N.D.1978). Here, the State presented a prima facie case. Jackson did not receive ineffective assistance of counsel.

[¶ 4] The district court’s judgments of conviction are affirmed.

[¶ 5] GERALD W. VANDE WALLE, C.J., WILLIAM A. NEUMANN, MARY MUEHLEN MARING, and CAROL RONNING KAPSNER, JJ., concur.