By DAVID GELLER
Warranty is a cost of business, and customers expect you to stand behind your work.
A jeweler will go out and buy a cell phone or other electronics and expect it to work flawlessly for one full year. If it has any problem you take it back to the retailer and let them know:
• It doesn’t work
• The lid doesn’t snap tight
• It didn’t have this scratch on it when I bought it
The store doesn’t quiz you to the nth degree:
• “Did you wear it in the shower?”
• “Did you bang it in a door?”
• “We only worked on the keyboard, we had nothing to do with the scratch on the bottom”
Nope, they just exchange or repair and keep the customer happy.
But nooooooo, size a ring for a customer and a month or so later a small diamond falls out and the typical jeweler’s hair is straight up on his back:
• “We only sized the ring and the diamonds were tight when it left the store.”
• “You must have pulled the prong back”
• “We only do fine work here. Be my guest; take it to the guy down the street!”
Boy, that sure is a good way to win friends and influence people! Think they’ll be back?
Why do jewelers treat customers this way? Because they take their work personally. They think it says they did a bad job.
The answer to this is this:
“It is what it is and you must do almost everything to make a customer happy.” It costs about $25-$50 to advertise and obtain a new customer. Repeat customers are almost free.
What if I personally paid you to make customers happy who came back with lost stones from work done in your store, and you’d make a profit on doing those repairs without any additional charge to the customer?
Do what everyone else does who warranties their work. Charge for it!
In April of 2000 I bought a new Lincoln LS car. Loved it. But every now and then it would just stop running. Luckily it didn’t happen on the highway, just city streets.
Three visits to the dealership and they just couldn’t fix it. Sent a letter to Detroit. They flew down a specialist; he looked at it and said, “Give the man a new engine! No charge.”
They did. It works and I didn’t pay a cent.
Or did I? It was included in the selling price. I have also paid up front when buying a laptop for the extended warranty. Two years later a $300 hard drive was at no charge and a friend who also paid $300 for his warranty got an $1800 cracked monitor on his laptop replaced. No charge.
We bought the warranty.
You should too. Here’s the place to start. Charge to check and tighten stones in jewelry you repair, especially ring sizing.
We don’t charge for checking/tightening and warranting stones loss if the ring has four or fewer stones.
But if the ring has five to 20 stones, we charge an additional $25 on top of the $39 to size the ring smaller.
The $25 charge is to
• Check each stone to see if they are loose when we finish the work.
• If they are loose, we charge to tighten them. If they aren’t loose, we still charge.
• In addition, guarantee that if they get loose in a year we’ll tighten them at no charge and if they fall out, replace them at no charge. There are some exceptions but for the most part this is covering all small stones (under 1/2 ct).
Let’s say you take in an anniversary band with seven 5-point round diamonds. You size the ring smaller and charge $39. Charge an additional $25 to check and tighten.
The speech to the customer goes like this:
“Mrs. Jones, for $39 our jeweler is going to size you ring to a 6½. He’ll make sure its round and you won’t see where it’s been sized. Our $25 ‘check and tighten’ gets the jewelers to make sure every stone is tight; if they get loose in a year we’ll tighten them at no charge, and if any of them fall out we’ll replace them at no charge. You don’t have to speak to the president; anyone here can have that done for you. Then our jeweler will refinish your ring like when it was new. We’ll have it ready next Thursday.”
That’s now a $64 charge.
Here are the numbers:
• If you take in 10 repairs, a day that’s 2,600 a year.
• Most stores tell me 50 percent to 75 percent of jewelry taken in has at least five stones in it. Out of 2,600 jobs, 1,300 to 1,950 jobs can have the sales speak given that I typed above.
• After telling the customer, easily 70 percent of them will say “Sure, go ahead, I want that service”.
• That means between 791 and 1,365 jobs will have the added $25 to it. That adds up to an additional $19,777 to $28,412 taken in without any effort. We collect the warranty money not because the stones are loose! We charge the customer even if the stones are tight because of our liability.
Cost of a Customer
So what’s it cost to replace two 5-point diamonds? Sixty dollars?
Don’t tick off a customer for $60. Make them happy and keep $19,777 to $28,412!
In addition to the repair charge, we charge to check, tighten and warranty stone loss based upon total stones:
0-4 stones No Charge
5-20 stones $25
21-35 stones $35
36-50 stones $50
What if the customer doesn’t want to pay the additional amount? On the envelope write “No guarantee on stone loss, customer didn’t want the service.” Charge without it, don’t tighten and don’t warranty. Seventy percent-plus of the customer will pay.
Two months later, two 5 point-diamonds fall out.
David Geller is the author of Geller’s Blue Book to Jewelry Repair & Design (a pricing book for making money in repairs and custom design for jewelers and pawnbrokers) and a consultant to jewelers on store management.
You may reach him at David@Jewelerprofit.com, 888.255.9848 or 404.255.9565, or through his website www.JewelersProfit.com.
Our repair pricing book is made for the counter at take-in. It’s put together to make it easy for the staff to use but we also have some free video training on our Web site you should use. There is training for each chapter of our book and I also train your staff how to sell repairs. Just go to our Web site: www.jewelerprofit.com/trainingvideos.html. The password is geller.
By RIC BLUM
It’s January, 2013 and the beginning of a new year (I think ‘13’ is going to be my lucky number). But Christmas is over and the shelves are still too full for my liking. And, once again, I vow to do something about it. (No, not have a birthday party for my inventory.)
Unfortunately, everything in my showroom is not precious metal and can’t be scrapped to make room for recently bought and forfeited merchandise.
Like the man in the red suit, I’m making a list and checking it twice.
I understand the concept of “turn” as in turnover and turning your inventory. Your turn ratio, or inventory turnover, is based on cost of goods sold divided by average inventory levels.
Average inventory can quickly be calculated by adding your inventory at the beginning of the period to your inventory at the end of the period, then dividing by 2.
It’s always calculated with one year’s numbers. You go back 365 days. It can be January through December or March 1 through February 29. It doesn’t matter, as long as you are using a 12 month period.
For example, an inventory turn ratio of 4 indicates that your company sells through its stock of inventory each quarter. Wal-Mart, which turns its inventory quickly, has a ratio of 8, while a higher margin retailer like Tiffany has a ratio closer to 1.
There are sometimes exceptions to selling every item within a certain time frame. Antiques and collectables would be one. Their turn is usually a little slower, while their profit margin may be a little higher. But we’re generally talking overall sales figures when calculating turn rather than individual items. Of course, you may do the same thing for each inventory category.
Definition of Inventory Turnover — A ratio showing how many times a company’s inventory is sold and replaced over a period.
But I’m not really interested in getting too technical here. I’m just concerned with moving some dead merchandise in my lucky 13 year and having a positive cash flow.
So I bought some new, blank price tags, something different from the ones I regularly use (a different color, and they say “Special” — I hate using the word “Sale”). This way, my employees will have little difficulty figuring out which items I have decided we should set free this year (hopefully, this quarter).
Next, I’m slashing prices on aged inventory. Depending upon the item, prices will be reduced by 1/3 to 1/2 or even more (if I really want to see it gone).
Now, I’m not saying my prices were too high to begin with; it is just for some reason, no one has opted to buy these items. Maybe it’s the economy. Maybe it’s my local market.
Maybe the tremendous price reduction is what they need to move them out the door. Maybe not. But I’m trying to move some dead inventory this year.
Tip No. 195
According to some estimates, 20 percent of all American small businesses are still using Windows XP, which was released in 2001. But the rest of us have upgraded to a newer version, the most recent of which is Windows 8.
My first encounter with Windows was back in 1989 with Version 2.something. Before that, I started my computer experiences with Microsoft DOS, Version 2.1 on 5¼ inch floppy disks in 1984 or 1985 with an IBM PCjr. I’ve dealt with a lot of versions of DOS and Windows since then. I’ve even learned to speak a little Mac.
From my understanding (and recent experiences at the pawn counter), Windows 8 has many new and improved features. However, to me, it appears more “touchy feely” and consumer oriented, rather than a solid business operating environment. But who am I to argue with Microsoft?
Many of the new features of Windows 8 are designed for touchscreen hardware. Also, the password feature has new enhancements that may make it almost impossible to “write down” a password to unlock touchscreen computers and tablets.
Windows 8 includes a feature called picture password that allow you to login to your account by using gestures on an image with your finger or your mouse. This is especially useful for tablets where you want to avoid typing if you can. Instead of typing in a password, you select a picture and then create three gestures to act as your password. They can consist of taps, circles or lines.
Once the picture password is created, you can login to your Windows accounts by performing these gestures in the same direction as when you created them. That means if you circled an object counterclockwise, you would need to circle it counterclockwise to login. Circling it clockwise would not count as a successful gesture.
This method allows for tremendous variation in possible passwords on a given picture and allows you to avoid having to use the virtual keyboard.
As a result, we are changing our policy for making computer loans. The pawner must remove all passwords before we will take a computer in pawn. I’ve got a great password removal program, but I don’t know yet if it’s Windows 8 compatible. I’ve also got better things to do than remove passwords from forfeited computers.
Picture password to this point can only be solved by removal, but you may still have a textual password to deal with.
Bonus Tip No. 1
Manufacturers of tablet computers, with other, non-Windows operating systems also allow for a graphical password. You can’t write these down.
Have your customer, after unlocking their tablet (they can do this, can’t they?) remove the password.
Shut down the tablet and then restart it to be sure it will boot without a password.
Bonus Tip No. 2
One more thing: When you turn on the computer presented to you, check on the bottom right-hand corner of the screen. If the computer displays a message “This copy of Windows is not genuine” you should probably not accept that computer for a loan or purchase.
Immediately after you log on, you see the following Windows Activation window:
Windows is not genuine
Your computer might be running a counterfeit copy of Windows.
You may also notice the following symptoms:
The computer desktop background is black, and you receive the following error message on the bottom right corner of the screen:
“This copy of Windows is not genuine”
Yes, you might be able to restore the computer back to its original factory settings, but quite often, when the actual Windows software has been changed, the hidden restore partition has also been erased.
Now there are ways to get around this, like re-install the correct version of Windows and enter the license number affixed to the label on the computer. (Windows software is licensed to the motherboard of the computer, not the computer itself or the hard drive.)
You may change anything you like except the motherboard and still have a legal copy of Windows. Unfortunately, I find on many used computers, the license number on the label is worn or otherwise illegible. It is nice that on some newer notebook models, they are placing the license label in the battery compartment where it is protected from wear and tear.
The point of this Tip is that it certainly doesn’t look good for you to be selling a computer that says it’s running software that may not be quite legal. And often the Windows software will not run after 30 days without activation (that is where a legal license number comes back into play). While there are workarounds for computer specialists, it is not always worth the time and effort involved.
Not to mention you may have to manually install many Windows drivers and all of the pretty stuff (software) that originally came with the computer, including a restore partition, which is probably gone.
Tip No. 196
Being the owner, manager or responsible party for a pawnshop incurs many additional duties, even after the pawnshop is closed. You know, those little things, like buying toilet paper, light bulbs, coffee and responding to burglar alarm calls.
Another one of those additional responsibilities is the need to have access to reliable transportation in order to respond to an alarm call in a timely manner. This also means you are responsible for ensuring you have an adequate amount of gas in your car to enable you to respond to that alarm call at 3 a.m. for a store that is 10 or 20 miles away from your home and get back home.
Parking your car in the garage with the gas gauge on ‘E’, thinking you’ll stop in the morning on the way into work to fill it up, is not being very responsible.
It might not be easy to find a gas station open at three in the morning, not to mention the additional time needed to respond to that alarm call.
My new rule, if your gas gauge reads less than a quarter tank, fill it up. Just one new responsibility to add to your growing list.
My gas tank warning light was blinking on my dash on the way home the other night. I figured I could wait until morning. I pass a half dozen gas stations on the way in to work.
But I didn’t. I took the time and stopped to fill it up. You can probably figure out what happened at 3 a.m.
Bonus Tip No. 3
I’ve said this before and I’m going to repeat it — never respond to an alarm alone. Always take someone with you or arrange to meet them a block or two away.
Tip No. 197
I get lots of emails from others which have been forwarded around the world a few millions of times. Some I have seen before, others are new. Some are cute, some risqué, and others a waste of cyberspace.
But every now and then, I find one that actually contains some important information. This is one that I received recently and I thought I would include it in my Tips column — in case we’re not all on the same email list.
Put your car keys beside your bed at night.
Tell your spouse, your children, your neighbors, your parents, your doctor’s office, the check-out girl at the market, everyone you run across. Put your car keys beside your bed at night.
If you hear a noise outside your home or someone trying to get in your house, just press the panic button for your car. The alarm will be set off and the horn will continue to sound until either you turn it off or the car battery dies.
This tip came from a neighborhood watch coordinator. Next time you come home for the night and you start to put your keys away, think of this: It’s a security alarm system that you probably already have and requires no installation.
Test it. It will go off from most everywhere inside your house and will keep honking until your battery runs down or until you reset it with the button on the key fob chain. It works if you park in your driveway or garage.
If your car alarm goes off when someone is trying to break into your house, odds are the burglar/rapist won’t stick around. After a few seconds, all the neighbors will be looking out their windows to see who is out there and sure enough the criminal won’t want that.
And remember to carry your keys while walking to your car in a parking lot. The alarm can work the same way there. This is something that should really be shared with everyone. Maybe it could save a life or a sexual abuse crime.
I am sending this to everyone I know because I think it is fantastic. Would also be useful for any emergency, such as a heart attack, where you can’t reach a phone. My Mom has suggested to my Dad that he carry his car keys with him in case he falls outside and she doesn’t hear him. He can activate the car alarm and then she’ll know there’s a problem.
Tip No. 198
In today’s security-conscious business environment, I just can’t see how someone would be so naive as to think they could leave jewelry in their showcases.
But all too frequently I have seen jewelry cases covered with sheets. Even if you have removed the valuables, this gives the public the impression there is still jewelry left in the showcases at night, rather than removed and locked in a safe or vault. You are just asking for someone to break-in.
Unless you have sheets made from the same fabric as Superman’s cape, I would think it might be better to remove your jewelry from your showcases at night.
I first noticed the sheets over the showcases in a small jewelry store a few months back, on my way home from a restaurant down the street from its location. I couldn’t believe what I thought I saw. I stopped, turned around and went back for a better look.
But then again, I often read in trade publications, electronic media and newspapers, accounts of pawnshops, jewelry stores and firearms stores where a large quantity of merchandise was taken from the showcases during a break-in.
This is not new. Break-ins of businesses have been going on for thousands of years. You would think by now most business owners would have received the memo — REMOVE YOUR VALUABLES FROM YOUR SHOW-CASES AT NIGHT!
Yes, it takes time to remove your merchandise and displays. And it takes even more time to put them back. It also causes more wear and tear to your displays requiring you to replace them more often. This is just another cost of doing business: man-hours, fixtures and displays.
But as I have seen many times before, until you experience first-hand the loss and damages from an “after-hours shopper,” you may have blinders on.
Now of course we can’t remove all of our merchandise from all of our showcases every night. But we need to pick and choose and prioritize. The iPods and iPads can stay. But jewelry of any considerable value needs to be secured.
Typically, jewelry is displayed in trays or on other displays. You need to decide whether to remove it as individual pieces, trays or displays, or possibly removing the entire floorboard from your showcase with the jewelry intact.
Next, your overnight storage facility (a safe) needs to be set up to handle your storage needs. It should be outfitted with shelves spaced out accordingly to accommodate your displays, floorboards or storage containers.
Large rolling jewelry transport carts are available with many shelves for holding jewelry that can be stored in a walk-in vault. Even a back room with a locked door will slow down an intruder and keep the jewelry out of sight.
You may even opt to fabricate your own rolling cart from wire shelving available from most industrial supply houses and home centers. A wide variety of shelf sizes are available. You can even chose the height of the shelving unit and add wheels for mobility.
Don’t have a dedicated safe or storage area for night-time jewelry storage? Hide it. Put your jewelry in a box or boxes on a shelf (or shelves) in your backroom. Spread it out so it is in multiple locations.
This will still give you the appearance of removing your jewelry and securing it for the night and make it harder for someone to find.
Bonus Tip No. 4
Some business owners practice the cleaning of showcase glass at night, before going home. This way, if the unthinkable did happen, there would be fresh fingerprints on the showcases. Of course if the bad guys wore gloves, this effort would be futile. But on the positive side, it saves time cleaning the showcase glass in the morning.
Many of the tips I offer will be of more benefit to newer pawnbrokers, but some more experienced pawnbrokers may find something ‘new’ and interesting, also.
If you are new to this column, I share three or four tips per issue that you can use in your pawnshops to help sales, security, merchandising, or make life a little easier. Since we all run our pawnshops differently, I try to cover a broad range of subject areas to appeal to a wide scope of interests.
Many of these tips come from personal experience (that translates into trial and error). Others come from fellow pawnbrokers kind enough to share something that has worked well for them.
You may even want to contribute a tip or two for future columns.
Ric Blum is a vice-president of Dayton’s Ohio Loan Co. He has served as president of the Ohio Pawnbrokers Association, secretary/treasurer of the National Pawnbrokers Association and as a member of the board of directors and the board of governors of the National Pawnbrokers Association. Please feel free to e-mail your comments or tips that you would like to see included in this column to RicBlum@att.net or mail them to Ric Blum, Ohio Loan Co., 3028 Salem Ave., Dayton, OH 45406.
By RICHARD WEATHERINGTON
If the seller of a stolen item lets it go for far below its fair market value, the law may allow a jury to infer that the seller knew that the item was stolen. But what if the fair market value was never established in court? Would the conviction stand?
Recently, a man convicted of dealing in stolen property under similar circumstances claimed that the trial court was wrong and his conviction should be overturned.
A man, whose first name was Donnie, was charged with dealing in stolen property and false verification of ownership on a pawnbroker’s transaction form. The charges arose from the theft of an air compressor, which Donnie had sold to a Florida pawnshop for $35.
Donnie went to trial, and at the end of his trial the court instructed the jury, without objection by Donnie, that proof of the purchase or sale of stolen property at a price substantially below the fair market value, unless satisfactorily explained, gives rise to an inference that the person buying or selling the property knew or should have known that the property had been stolen.
During closing arguments, the state brought up this inference and argued, “this $35 for this air compressor was an indication that Donnie knew or should have known it was stolen. This is worth a lot more than $35.” Donnie didn’t raise an objection to this statement.
The jury instructions basically followed Florida Law Section 812.022(3), which provided that “Proof of the purchase or sale of stolen property at a price substantially below the fair market value, unless satisfactorily explained, gives rise to an inference that the person buying or selling the property knew or should have known that the property had been stolen.”
After Donnie was convicted by the jury, he appealed his conviction to the First District of the Florida Court of Appeals. He claimed that the trial court got it wrong in its instruction to the jury that proof of the sale of stolen property below the fair market value gives rise to an inference the seller knew or should have known the property was stolen, because in his case, no evidence was presented of the compressor’s fair market value.
Value of Compressor
The Appeals Court first noted that although it agreed with Donnie that there was no evidence presented about the fair market value of the compressor, it disagreed that giving the instruction constituted a fundamental error.
A fundamental or plain error is an obvious error that reaches to the basic foundation or merits of a case or affects substantial right of the parties and may result in the voiding of a judgment.
Donnie argued that the trial court committed a fundamental error when it included this inference in its instruction to the jury because the state failed to establish evidence that $35 was in fact substantially below fair market value of the compressor he sold to the pawnshop. He claimed the error was fundamental because it pertained to knowledge, which was an essential element of the crime of dealing in stolen property.
Donnie pointed to several cases in which courts found that giving a jury instruction on a statutory inference that was not supported by the evidence was a harmful error. The Appeals Court noted that the only case Donnie relied on that dealt with a fundamental error was the 2003 case of Tatum v. State, in which the Second District of the Florida Court of Appeals indicated the instruction on a statutory inference without the proper factual basis may be a fundamental error.
The defendant in the Tatum case, a pawnshop owner, was charged with racketeering in the operation of a pawnshop under Florida’s RICO Act. Some of the alleged transactions were made by the pawnbroker himself and others were made by his employee.
The jury was instructed that proof a dealer bought or sold property “out of the regular course of business or without the usual indicia of ownership” gave rise to an inference that the dealer knew or should have known the property was stolen.
The Second District found this instruction was permissible only where the dealer personally made the sale, because the inference goes to prove an essential element of the crime, the defendant’s state of mind.
Thus, the Second District ruled the instruction was an error, and it served to bolster the testimony of the state’s key witness, who was the pawnbroker’s employee.
The Second District concluded that although the state claimed the issue was insufficiently preserved for appellate review, the court said that the error was a fundamental error. The First District Court of Appeals hearing Donnie’s appeal noted, however, that the Second District gave no other reason for its finding that the error was a fundamental one.
The First District Court of Appeals looked at the 2002 case of Cardenas v. State, in which it made a distinction by ruling that an improper instruction or failure to instruct as to an essential element of a crime may rise to the level of a fundamental error.
But in contrast, the court held that a “challenged instruction that merely advised the jury of an evidentiary presumption or permissible inference that they were free to accept or reject” was not a fundamental error.
In the Cardenas case, the defendant argued that the standard jury instruction on the presumption of impairment that arises when blood tests reveal high alcohol levels was a fundamental error. The First District Court of Appeals rejected that argument, finding the instruction neither omitted from the definition of an offense one of the essential elements nor misdefined one of the essential elements of an offense.
As such, the court concluded it did not appear the instruction influenced the outcome of the trial or that the guilty verdict could not have been obtained without the improper instruction.
Here, said the Appeals Court, as in Cardenas, the standard jury instruction at issue did not omit or erroneously define an essential element of the offense.
It merely advised the jury that it could infer Donnie knew the air compressor was stolen if he sold it substantially below the fair market value. Upon review of the record, Donnie’s theory of defense was that the victim mistakenly identified the air compressor as his own, not that Donnie didn’t know that it had been stolen.
As such, said the Appeals Court, giving the instruction in this case did not constitute a fundamental error. The Appeals Court, therefore, affirmed the judgement of the trial court.
Readers who would like a free copy of this case sent electronically should send an e-mail to firstname.lastname@example.org with “Fundamental Error” in the subject line.
By RICHARD WEATHERINGTON
Criminal statutes are supposed to be written clearly to ensure that a person is not subjected to a criminal penalty unless the words of the law plainly impose it. So when a pawnshop employee sought to have her theft conviction overturned, she pointed to the “explicit” wording in the statute.
An investigator for a national retail chain, which owns and operates discount retail stores, began investigating losses at several of the chain’s stores in Alabama when he received information from several shoplifters that he should look at a certain Web site.
The investigator found that the site listed numerous items similar to those stolen from the chain’s various stores in the area. Police then conducted a series of undercover sales at several locations of an Alabama pawnshop, with the help of a confidential informant, M.B.
An undercover officer and M.B. went to one of the stores to pawn three new iPods — portable media players — provided by the retailer. The officer had his hand bandaged when he went to the pawnshop.
When they entered the store, the officer claimed several store employees, including a woman whose first name was Jennifer, were behind the counter. They approached Jennifer with the three new iPods, put the iPods on the counter, and told her that they wanted to sell them.
The officer said that Jennifer went to talk to another employee. When she came back, she said that the shop would give them $195 for the merchandise. The other employee went into the back and came back with the money, while Jennifer entered information into a computer.
The undercover officer said that while Jennifer was working on the transaction, M.B. asked how much they would pay for a 60-gigabyte iPod and if they could bring more new iPods in the next day.
The police department executed search warrants at three of the pawnshop’s stores. At one location, police discovered a room that contained new items that appeared to be for sale on the Internet Web site.They found shipping labels, packaging materials, and a folder of tickets for items that had been bought during the sting operations. Jennifer was charged with theft of property in the second degree.
Implied, Not Stated
At the trial, the lead detective on the case testified that during the sale involving Jennifer, M.B., and the undercover officer, neither M.B. nor the officer went up to Jennifer and said that the iPods were stolen, but they did imply that they were.
When they executed a search warrant, they discovered two of the iPods Jennifer had purchased were in the back storage area of the store and the third iPod was on the sales floor. The detective testified that according to the city code, pawnshops were supposed to provide information regarding the items they take in but that, in this case, they gave only two serial numbers.
There was also testimony to the effect that state law required a pawnshop to hold merchandise for 15 days before putting it up for sale or transferring it to another location.
The state played a recording of the transaction for the jury. It showed that during the transaction, M.B. asked the officer about his hand. The officer responded that it was better and that the bleeding had stopped.
M.B. said to the undercover officer, “I’m tired of stealing, man. I’m so tired. I’m ready to go home now.” He then asked the officer: “You’ll think twice before you wrestle them cases again, won’t you?” and the officer responded: “Yep.” M.B. also said: “Man … I need to get me one good lick about a … big screen TV and be through with it.”
After Jennifer told them how much they would get for the iPods, M.B. said: “That’s not bad, I guess,” and the officer responded, “I cut my damn hand getting them things out of the case.”
Working Under Supervision
Jennifer testified that in 2007 she was working at the pawnshop part time, and that her primary responsibilities were to clean the store and merchandise. She occasionally handled transactions, but she had to consult a manager on what items the store would buy.
On the day M.B. and the undercover officer came in with the iPods, she said she took the merchandise to the manager, who was in the back, and he examined it and gave her a price. Jennifer said that she went back and after they agreed to the price, she went to the computer, which was away from the counter, to input the data from the transaction.
She claimed that she didn’t hear M.B. or the undercover officer say anything about breaking into a case or anything to do with a case, that she didn’t hear anything that led her to believe that the iPods were stolen, that it was loud in the store, and that no one explicitly told her that the iPods were stolen.
She said that when she put the number of the iPods in the computer she got mixed up and transposed the middle four digits of the serial numbers. Jennifer testified that she would not knowingly take stolen property and that many customers brought in new property to pawn.
Jennifer was convicted and sentenced to 10 years in prison, but her sentence was suspended and she was placed on three years’ supervised probation.
She appealed her conviction to the Alabama Court of Appeals, claiming that the state failed to present sufficient evidence to support her conviction.
Specifically, Jennifer claimed that the state didn’t prove that the undercover officer and M.B. “explicitly” represented to her that the iPods were stolen; rather, she argued, they only implied that the items were stolen.
The Appeals Court first noted that in deciding whether there was sufficient evidence to support the verdict of the jury and the judgment of the trial court, the evidence must be reviewed in the light most favorable to the prosecution. Conflicting evidence presents a jury question not subject to review on appeal, provided the state’s evidence establishes a prima facie case.
In applying this standard, the appellate court will determine only if legal evidence was presented from which the jury could have found the defendant guilty beyond a reasonable doubt. A verdict of conviction, said the court, would not be set aside on the ground of insufficiency of the evidence unless, allowing all reasonable presumptions for its correctness, the preponderance of the evidence against the verdict was so decided as to clearly convince the Appeals Court that it was “wrong and unjust.”
The court noted that the role of appellate courts is not to say what the facts are, but rather to judge whether the evidence was legally sufficient to allow submission of an issue for decision to the jury.
Circumstantial evidence alone, said the court, is enough to support a guilty verdict of the most heinous crime, provided the jury believes beyond a reasonable doubt that the accused is guilty. Circumstantial evidence is not considered inferior evidence and is entitled to the same weight as direct evidence, provided it points to the guilt of the accused.
Because intent is a state of mind, noted the court, it is rarely susceptible of direct or positive proof. Instead, the element of intent must usually be inferred from the facts testified to by the witnesses together with the circumstances as developed by the evidence. Finally, the intent of a defendant at the time of the offense is a jury question.
The Appeals Court noted that Section 13A-8-2(3) of the Alabama Code says a person commits the crime of theft of property if he or she: “Knowingly obtains or exerts control over property in the custody of a law enforcement agency which was explicitly represented to the person by an agent of the law enforcement agency as being stolen.”
Section 13A-8-4(a) provides that theft of property in the second degree is the theft of property which exceeds $500 in value but does not exceed $2,500 in value, and which is not taken from the person of another.
Alabama, said the court, has yet to address the extent of evidence necessary to satisfy the “explicit” requirement of Section 13A-8-2(3). To sustain a conviction for theft of property, the state had to prove that Jennifer knowingly obtained or exerted control over property in the custody of a law enforcement agency, which was explicitly represented to her by an agent of the law enforcement agency as being stolen.
The Appeals Court noted that it is a well-established principle of interpretation of law that where the meaning of the plain language of the statute is clear, it must be construed according to its plain language. Courts are instructed to interpret the plain language of a statute to mean exactly what it says and to engage in judicial construction only if the language in the statute is ambiguous. Criminal statutes must be strictly construed to avoid ensnaring behavior that is not clearly prohibited.
A criminal statute, said the Appeals Court, is to be construed strictly, not loosely. Such are the teachings of the cases from 1820 to the present day. Chief Justice Marshall’s statement in 1820 that penal laws are to be construed strictly is founded on the tenderness of the law for the rights of individuals; and on the plain principle that the power of punishment is vested in the legislative, not in the judicial department.
A person is not to be subjected to a penalty unless the words of the statute plainly impose it.
The Appeals Court noted that according to the 11th edition of Merriam Webster’s Collegiate Dictionary, the term “explicit” is defined as “fully revealed or expressed without vagueness, implication or ambiguity: leaving no question as to meaning or intent.”
The use of the term “explicitly” in Section 13A-8-2(3), said the court, is not ambiguous. When the plain, ordinary, and commonly understood meaning is applied to the language in Section 13A-8-2(3), it is clear that the legislature intended a person charged under this particular provision of the theft statute have knowledge, beyond that which could be implied, that the property in the custody of the law enforcement agency was in fact stolen.
Here, noted the court, the evidence presented by the state established that the undercover officer and M.B. didn’t explicitly represent to Jennifer that the iPods they were seeking to pawn had been stolen.
Indeed, the lead investigator in this case admitted as much. He testified that the plan was for the officer and an informant to go into the pawnshop, explain that the property was stolen, and see if the pawnshop would take the property. However, he admitted that neither M.B. nor the officer said that the iPods were stolen but merely implied that they were.
The fact, said the Appeals Court, that the undercover officer and M.B. believed that Jennifer “had to have heard” what was said during their conversation because she was close to them simply failed to establish an “explicit representation” as required by Section 13A-8-2(3).
The legislature’s use of the term “explicitly” in the statute connotes a more stringent level of proof than normally required by law. Had the legislature intended to require a lesser degree of proof, it would not have used such a precise term as “explicitly.”
Although the state presented evidence indicating that Jennifer may have had reason to believe that the iPods were stolen, the evidence was insufficient to support a conviction under Section 13A-8-2(3) because no explicit representations were made to Jennifer that the iPods were in fact stolen.
The Appeals Court concluded that for the foregoing reasons, Jennifer’s conviction for theft of property in the second degree had to be set aside and entered a judgment in her favor.
Pawnbrokers who would like a free copy of this case sent electronically, should send an E-mail to email@example.com with “Explicit” in the subject line.
By RICHARD WEATHERINGTON
Public officials are granted a vast amount of protection from civil liability when they are acting in their official capacity. So it is often very difficult for a pawnbroker who feels wronged by an officer’s action to get redress. But recently, when an officer sought immunity, things did not go very well for the officer.
In January 2011, a police officer in Georgia, whose first name was Kandy, was investigating several burglaries in the county. She was told that two high school students were involved. The students eventually confessed, stating that they sold some of the stolen items to a local pawnshop and some to the pawnbrokers at their home.
Relying on this information, Kandy informed the sheriff that she would seek a search warrant for the shop and the pawnbrokers’ home. Another officer gave Kandy a search warrant that had been used to search the same pawnshop. Using it as a template, Kandy prepared a sworn affidavit in support of a search warrant and presented this information to a local judge.
The affidavit in support of the search warrant and the search warrant, as given to the judge, included no information regarding the pawnbrokers’ home or the students’ statements concerning the sale of items at the brokers’ home. The judge who approved the original search warrant mentioned to Kandy that her investigation could lead her to search the pawnbrokers’ home and that she should talk to another officer who investigated a similar situation.
Kandy returned to the sheriff’s office with the search warrant, and she, the sheriff, and two other officers left in Kandy’s vehicle to execute the warrant. The sheriff read over the search warrant and noticed that it still contained the name of the officer who provided the warrant that was used as the template.
Kandy took the search warrant from the sheriff, went back to her office, deleted the other officer’s name, added her own name, and took the modified search warrant back to the judge for approval.
After receiving the judge’s signature on the amended search warrant, Kandy returned to her car where the other officers were waiting. The sheriff looked over the amended search warrant and noticed that the pawnbrokers’ home address was not included. He asked Kandy if she intended to also search the brokers’ home.
She said she was and that she would fix the warrant. All of the officers left the vehicle while Kandy corrected the warrant a second time.
Kandy returned to her office with another officer. That officer added the brokers’ home address to the warrant and printed the new page. Kandy removed and shredded the page from the first amended search warrant and attached the altered page with the pawnbrokers’ home address to the page with the judge’s signature.
The second amended search warrant was never presented to or approved by the judge. Although accounts of the amount of time it took Kandy to alter the search warrant differed, it took somewhere between 5 and 30 minutes. During this time, the sheriff was in his office.
Kandy then gathered the officers again and told them she had added the address to the search warrant. That group then executed the second amended search warrant, first searching the pawnshop and, then, several hours later, the pawnbrokers’ home.
The judge later learned that the officers had searched the brokers’ home. When the judge asked whether the officers had added anything to the search warrant, the sheriff replied that they had “added his address.” The judge informed them that there was no information in the affidavit or search warrant to permit the search of the residence and that everything seized pursuant to the second amended search warrant had to be returned.
The pawnbrokers then filed suit under U.S. Code Title 42 Section 1983 in the U.S. District Court for the Northern District of Georgia against the sheriff and Kandy, in their individual and official capacities, alleging that they violated the brokers’ Fourth and Fourteenth Amendment rights and the Georgia Constitution and conspired to interfere with their civil rights by illegally obtaining and executing a search warrant for the brokers’ home. The sheriff and his officer filed a motion for summary judgment on all claims, arguing that they should receive qualified immunity on the federal claims, official immunity on the state law claims, and that there was no evidence to support the conspiracy claims. The pawnbrokers in turn moved for a partial motion for summary judgment on Kandy’s liability under the federal claims.
The district court denied the motion for summary judgment by the sheriff and Kandy and granted the pawnbrokers’ motion. The sheriff and Kandy filed an appeal of the district court’s denial of qualified and official immunity to the U.S. Court of Appeals for the Eleventh Circuit and sought a review of the district court’s decision on the conspiracy claim by asserting pendent jurisdiction.
Pendent jurisdiction gives the federal court the ability to decide state law claims under certain circumstances. They also appealed the grant of partial summary judgment in which the district court found Kandy liable for violating the pawnbrokers’ Fourth Amendment rights.
Qualified immunity, said the Appeals Court, is an entitlement not to stand trial when the discretionary or elective conduct of a public official acting for the government does not violate clearly established statutory or constitutional rights.
A denial of qualified immunity on a motion for summary judgment is immediately appealable when it concerns solely the pure legal decision of (1) whether the implicated federal constitutional right was clearly established and (2) whether the alleged acts violated that law. The appeal must present a legal question concerning a clearly established federal right that can be decided apart from considering the sufficiency of the evidence.
Here, Kandy claimed that it was not clearly established constitutional law that, absent imperative circumstances, an officer must obtain a search warrant from a neutral and detached judicial officer to search a home. For that reason the Appeals Court said that it had jurisdiction to hear Kandy’s appeal.
However, in the sheriff’s case, he only contended that he did not personally participate in Kandy’s alleged unconstitutional conduct because he did not know that Kandy improperly changed the search warrant.
Because this argument required the Appeals Court to consider the sufficiency of the evidence only, and not whether the sheriff violated a clearly established federal right, the Appeals Court concluded that it did not have jurisdiction to hear the sheriff’s appeal and dismissed the interlocutory appeal seeking qualified immunity for the sheriff. An interlocutory appeal is an appeal made before the trial court’s final decision on the whole case.
An officer is not entitled to qualified immunity when, acting in a discretionary capacity, he or she violates clearly established constitutional or federal law. When Kandy executed the search warrant, said the Appeals Court, she was acting in her discretionary capacity as a law enforcement officer; therefore, the court’s analysis would focus on whether she violated clearly established law.
The court said it decides whether the alleged facts show a violation of clearly established law by “(1) defining the official’s conduct, based on the record and viewed most favorably to the non moving party, and (2) determining whether a reasonable public official could have believed that the questioned conduct was lawful under clearly established law.”
It is clearly established constitutional and federal law that a law enforcement officer may not search a home, absent imperative circumstances, unless the officer has a warrant that has been fully approved by a neutral and detached judicial officer.
The Appeals Court noted that Kandy used a forged search warrant to search the pawnbrokers’ home and that she did not attempt to justify her error by claiming an exception to the warrant requirement, nor could she.
Furthermore, her claim of ignorance of basic Fourth Amendment jurisprudence did not require the court to grant her qualified immunity. The qualified immunity analysis asks whether it would be clear to a reasonable officer that his or her conduct was unlawful in the situation that was confronted, not whether the officer subjectively believed his or her actions were lawful. Therefore, the Appeals Court affirmed the district court’s denial of qualified immunity to Kandy.
Next, the Appeals Court said it had jurisdiction to review an interlocutory appeal from the denial of official immunity under Georgia law. The court reviews the district court’s denial with a fresh look. Official immunity protects Georgia state officers and employees from liability.
However, the Georgia Constitution permits state officers and employees to be held liable for damages “if they act with actual malice or with actual intent to cause injury in the performance of their official functions.”
It was undisputed, said the court, that the sheriff and Kandy were performing their official duties when executing the search warrant. Thus, the pawnbrokers must show that the officers were acting with actual malice or intent to cause injury.
Georgia case law defines “actual malice” as “express malice,” which means a deliberate intention to do wrong, and does not include “implied malice,” which means the reckless disregard for the rights or safety of others. A deliberate intention to do wrong is “the intent to cause the harm suffered by the plaintiffs.”
Viewing the facts in the light most favorable to the pawnbrokers, the Appeals Court said it agreed with the district court that there were genuine issues of fact regarding whether Kandy acted with actual malice and whether the sheriff knew of her actions.
For example, Kandy knew that she needed to have the magistrate approve the name change, but then claimed that she did not know that she needed the magistrate’s approval to add an entirely new location to be searched.
In addition, there was contradictory testimony about whether the sheriff read the affidavit, which did not include any description of the brokers’ home, and about how much time it took Kandy to amend the warrant.
A claim under U.S. Code Section 1983 of Title 42 requires the pawnbrokers to first show that they had been “deprived of a right secured by the Constitution and the laws of the United States” and secondly, that the officers deprived them of this right acting under color of state law.
Kandy, noted the Appeals Court, was acting under the color of state law when she executed the invalid search warrant. Furthermore, by knowingly executing an invalid search warrant, she clearly deprived the brokers of their Fourth Amendment rights. Therefore, said the Appeals Court, it affirmed the district court’s grant of the pawnbrokers’ partial motion for summary judgment about Kandy’s liability on the federal claims.
In an unpublished opinion issued in July 2012, the Appeals Court affirmed the district court’s denial of qualified immunity for Kandy and official immunity for Kandy and the sheriff. It also affirmed the grant of the pawnbrokers’ partial motion for summary judgment regarding Kandy’s liability for the federal claims. Finally, it dismissed the interlocutory appeal seeking qualified immunity for the sheriff for lack of jurisdiction as well as the interlocutory appeal regarding the conspiracy claim.
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