Friday, June 17, 2016
S.C. Revives Funds Misuse Case Against Former BHUSD Head
By a MetNews Staff Writer
The state Supreme Court yesterday reinstated proceeding against a former Beverly Hills school superintendent convicted of misappropriating funds.
The justices unanimously agreed that the Court of Appeal for this district erred in its construction of the statute under which Jeffrey Hubbard was charged. The high court overturned the Court of Appeal’s order that the case be dismissed and sent the case back to the panel for further proceedings.
Hubbard was superintendent of the Beverly Hills Unified School District from July 2003 to June 2006. Prosecutors charge that he paid Karen Christiansen, former director of planning and facilities for the district, an unauthorized bonus and increased her car allowance.
Christiansen’s car allowance was boosted from $150 monthly to $500 in 2005. She was also granted a $20,000 stipend in 2006. She and Hubbard were both charged after she became the subject of a broader investigation, which resulted in her being convicted of having secretly negotiated four contracts on behalf of the district that benefited a company that she owned.
That conviction was thrown out by Div. One, six months before it threw out Hubbard’s conviction. The panel said Christiansen was not a district officer or employee within the meaning of the conflict-of-interest statute, Government Code §1090, because the contracts were negotiated after she left her position as facilities director and became a consultant to BHUSD in 2006.
Hubbard was found guilty on two counts of violating Penal Code §424, which makes it a crime for a person “charged with the receipt, safekeeping, transfer, or disbursement of public moneys” to appropriate those funds to the defendant’s own use or that of someone else. The Court of Appeal, in an opinion by Presiding Justice Frances Rothschild, said the prosecution failed to prove that the superintendent had control over the district’s funds.
The high court, in an opinion by Justice Mariano-Florentino Cuéllar, rejected the attorney general’s argument that any public official who diverts funds, not merely one who is “charged with the receipt, safekeeping, transfer, or disbursement of” those moneys, is guilty of violating §424. But the Court of Appeal’s view of the superintendent’s role in the handling of district funds was too limited, Cuéllar said.
“In light of Hubbard’s explicit contractual responsibilities to oversee the ‘budget and business affairs] of the District, testimony that superintendents like Hubbard owe a duty to safeguard school district funds, and Hubbard’s responsibility to ensure such public funds were spent in accordance with the law, we hold the evidence was sufficient,” Cuéllar said.
While the Court of Appeal noted that Hubbard, whose signature appeared on memos ordering the payments, “did not have the legal authority to order them unilaterally” because the school board had to approve, Cuéllar said the superintendent’s “actual and formal responsibilities as they pertain to public funds” included “the degree of material control over public funds that will satisfy the standard we have articulated.”
Hubbard, he noted, has attended and actually taught Association of California School Administrators courses on the fiscal responsibilities of superintendents. And there was evidence that the board gave Hubbard broad discretion over financial matters, Cuéllar said.
After being sentenced in February 2012, Hubbard served four days of a 60-day jail sentence. He was also sentenced to 280 hours of community service, three years’ probation, $23,500 in restitution to the school district and a $6,000 fine.
Hubbard’s lawyers contended that others in Beverly Hills Unified failed to follow proper procedures when Christiansen’s compensation was enhanced. They also asserted their client would have been absolved by emails between Hubbard and board members, which Hubbard said would show that the board approved the benefits, but Los Angeles Superior Court Stephen Marcus denied discovery of the emails on the ground it would have been unduly burdensome.
The propriety of that ruling could be a point of contention when the case returns to the Court of Appeal.
The case, People v. Hubbard, 16 S.O.S. 2888, was argued in the Supreme Court by Philip Kaufler for the defendant and Deputy Attorney General Dana Muhammad Ali for the prosecution.
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