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No. 103,677 IN THE COURT OF APPEALS OF THE STATE OF KANSAS STATE OF KANSAS, Appellee, v. ADAM L. HAND, Appellant.

SYLLABUS BY THE COURT 1. While a trial court acts in its sound discretion in a criminal case to determine the dollar amount of restitution and the manner in which payments shall be made, the more fundamental issue of what sort of costs may be assessed in the first place presents a question of law.

2. Not all tangential costs incurred as a result of a crime should be subject to restitution. The loss must be caused by, not merely connected to, the crime of conviction to be included in a restitution order.

3. A third party, including an insurance company, paying a crime victim's financial loss typically becomes an aggrieved party entitled to restitution payments from a convicted criminal under K.S.A. 21-4610(d)(1).

4. Generally, the fair market value of property at the time of its taking, rather than the replacement cost, is the proper measure of restitution. If fair market value cannot be 1

readily ascertained for a particular item, the court may consider other factors such as its age, condition, purchase price, and replacement cost to determine a reasonable value for restitution purposes.

5. In a theft case, a crime victim's increased insurance premiums typically would not be properly included in a restitution order in place of the fair market value of the stolen property.

6. A trial court errs in using increased insurance premiums as the measure of restitution in a theft case without first considering the fair market value of the stolen property and explaining why that value should be disregarded.

Appeal from Sedgwick District Court; JEFFREY SYRIOS, judge. Opinion filed May 6, 2011. Vacated and remanded with directions.

Joanna Labastida, of Kansas Appellate Defender Office, for appellant.

Boyd K. Isherwood, assistant district attorney, Nola Tedesco Foulston, district attorney, and Steve Six, attorney general, for appellee.

Before LEBEN, P.J., GREEN and ATCHESON, JJ.

ATCHESON, J.: This appeal presents us with a knotty issue regarding the scope of restitution for property crimes and, in particular, theft. We have found little in the way of directly applicable authority to guide us. What we have discovered leads us to conclude the trial court exceeded the governing statute and settled case law when it used the victim's increased insurance premiums to fashion a restitution amount without considering the value of the stolen property. The Kansas appellate courts have long 2

favored fair market value as the benchmark for restitution in theft cases. We, therefore, vacate the restitution portion of the judgment and remand for further proceedings.

In this case, Defendant Adam Hand pled guilty to a burglary and four thefts in Sedgwick County District Court arising out of several criminal episodes. The trial court placed him on probation in September 2009 and ordered restitution to his victims. In one instance, Hand entered a home and stole the owner's big screen television. He pled guilty to felony theft for that escapade. The owner filed a claim with his insurance carrier and apparently was paid for his loss, less a $250 deductable. The insurance company, however, imposed an annual surcharge of $345 on the victim's policy for the next 3 years because of the claim.

The trial court ordered Hand to pay the owner $1,285, reflecting the deductible and the premium surcharge as restitution under K.S.A. 21-4610(d)(1). Hand, through his lawyer, objected to the surcharge as an appropriate restitutionary cost. The trial court did not consider whether the value of the television provided either the better or the required measure of restitution for a crime involving property loss. Hand has timely appealed the matter of restitution. He does not dispute the order insofar as he must pay the victim the $250 deductible amount not covered under the insurance policy. He submits the premium surcharge constitutes a legally improper item of restitution.

While a trial court acts in its sound discretion in a criminal case to determine the dollar amount of restitution and the manner in which payments shall be made, the same is not true of the more fundamental issue of what sort of costs may be assessed in the first place. State v. Hunziker, 274 Kan. 655, Syl.

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