Restitution; Const. 1963, art. 1, § 24; People v. Turn; MCL 769.1a; The Crime Victim’s Rights Act (MCL 780.751 et seq.); People v. Garrison; People v. Allen; In re White; MCL 780.766(2); People v. McKinley; People v. Byard; Amount of the victim’s loss; People v. Fawaz; People v. Gubachy; Principle that restitution is a not a substitute for civil damages; People v. Lee; Entitlement to an offset

Holding that defendant was not entitled to an offset against the restitution amount awarded to a victim (L), the court vacated the restitution order and remanded the case to the trial court. Defendant pled no contest to 70 counts of uttering and publishing, and 3 counts of converting funds from prepaid funeral contracts. He was ordered to pay $234,394.67 in restitution. The prosecution appealed the trial court’s order as to restitution giving defendant credit for amounts allegedly owed to him by L “under promissory notes executed in 2005.” The court concluded that “the rights and duties of the parties under the 2005 promissory notes” were unrelated to determining the loss L suffered due to defendant’s criminal activities in this case. It held that whether L owed him money under those notes “was beyond the scope of the trial court’s duty to determine and order restitution.” The court noted that the restitution amount “must be based upon the actual loss suffered by the victim as a result of a defendant’s fraudulent activities.” It was the trial court’s obligation to determine the amount of loss L incurred due to “defendant’s fraud, which took place from 2008 to 2010. But the trial court’s decision reaches beyond the question of the loss suffered by the victim as a result of defendant’s fraud, and extends to determining the rights and duties of the parties under the 2005 promissory notes.” The only way the trial court could determine the enforceability of the notes and the alleged balance on them was if that debt related to the loss L suffered due to defendant’s fraud. If there was no quid pro quo involving enforcement of the notes and the amount defendant defrauded from L, “the restitution amount should not be offset by the amount owed on the notes.” The court found that the record showed that defendant did not “forego enforcement of the notes as a sort of quid pro quo to balance out the fraud debt; rather, he sold his interest in the notes to pay a debt he owed, authorizing the assignee to pursue [L] for the balance owed on” them. He claimed that because L later struck a deal with the assignee to pay less than the full amount owed, L “should give him the remaining amount that he would have had to pay defendant if defendant had not sold the notes and had instead successfully foreclosed on the debt.” But defendant’s failure to do so was unrelated to the fraud case.