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RESTITUTION AND CIVIL LIABILITY: THE CRIME THAT KEEPS ON GIVING

– By Robert Gerhardt

As civil litigators, we are often confronted with clients whose actions give rise not just to potential tort liability but also separate criminal prosecution. The most common example is an auto accident in which the insured is driving under the influence of alcohol or drugs and causes property damage or personal injury and is also arrested. The client is almost certain to receive an order of restitution in the criminal case and then is asked to pay for the same damages in a subsequent civil action. Explaining these issues to the client and, to the extent possible, minimizing these damages is one of the primary responsibilities of the civil attorney.

The recent case of People v. Vasquez 2010 Cal. App. Lexis 2107(Cal. App. 2nd December 28, 2010) provides guidance to the litigator and reaffirms the potential of a defendant to reduce a criminal order of restitution based on payments made in a civil suit, although it is limited and requires careful drafting to minimize the likelihood of the client paying twice for the same elements of economic loss.

The Vasquez court outlined the governing law regarding the relationship between criminal restitution orders and civil actions. The former is based on Penal Code Sec. 1202.4 which states that "It is the intent of the Legislature that a victim of crime who incurs any economic loss as result of a crime shall receive restitution directly from any defendant convicted of that crime." This recovery is limited to actual economic losses only (not general damages, such as pain or suffering) and is enforceable as a civil judgment even though it is not a civil judgment and does not extinguish civil liability. The court notes that a victim of crime is not fully compensated by a restitution order and, perhaps more importantly, the purpose of a restitution order is not intended to solely compensate victims but to rehabilitate the defendant and others from future crimes.

In Vasquez, the defendant permitted his pit bull to wander onto a public school yard where it badly mauled a seventh grader who underwent multiple surgeries. He was subsequently charged with multiple criminal offenses and pled to a single count of P.C. 399 (failing to control a mischievous animal that causes serious injury). He was placed on probation and ordered to pay restitution for past medical bills in the amount of $168,000 to the victim. In a subsequent civil suit brought against Mr. Vasquez as well as against his landlord the plaintiff agreed to accept the insurance policy limits of $300,000 in exchange for a release and dismissal of the pending civil action with prejudice. Mr. Vasquez then sought to have the restitution order declared satisfied based on the civil compromise which included payments for medical expenses. The motion was denied by the trial court and the decision was upheld by the 2nd District Court of Appeals.

While the court reaffirmed the right of a defendant to claim a set off against a restitution order for specific elements of damages which are duplicative of damages paid in a civil action, the Vasquez court denied any credit to this defendant. The court noted that the party seeking the credit bears the burden of proof as to "each fact, the existence or nonexistence of which is essential to his claim for relief." The evidence presented did not establish that the civil settlement made on behalf of several separate tortfeasors specifically include the past medical bills incurred by the minor, noting that the child was continuing to receive treatment.

For the civil practitioner representing a client in a civil suit, it is important to discuss the interplay between criminal restitution orders and civil settlements with the client and his or her criminal lawyer. To the extent possible, the settlement agreement should specifically state the elements of damages being compromised, such as past medical bills and lost wages, to serve as a record enabling a client to reduce a potentially devastating criminal restitution order, particularly where a large civil settlement is being made.