Background
Carl Anthony Conde contracted with three homeowners to construct swimming pools and related features. He received substantial payments but did not complete the projects. The record included abandoned work, poor workmanship, communication failures, unpaid suppliers, and work affected by permitting problems. On one project, Conde accepted money earmarked for a gunite supplier but did not pay the supplier. The State charged three counts of theft by deception and one count of engaging in a pattern of unlawful activity.
After a preliminary hearing, the magistrate declined to bind Conde over for trial and dismissed all four charges. The State appealed, arguing that the evidence and reasonable inferences met the comparatively low probable-cause threshold. It contended that Conde’s representations, failures across multiple projects, and handling of customer funds permitted an inference that he obtained money while knowing he would not perform as promised.
The Court’s Holding
The Utah Court of Appeals affirmed. Utah Code section 76-6-401 defines deception but specifically provides that failure to perform the promise at issue, without other evidence of intent or knowledge, is not enough to prove that the actor never intended to perform or knew the promise would not be performed. The State therefore needed evidence connecting Conde’s state of mind at the time he obtained each homeowner’s money to an existing intent or knowledge that he would not deliver.
The evidence showed serious business failures, but it did not supply that missing connection. Conde performed portions of the work, continued efforts on some projects, and generally obtained the relevant money before the point at which the State argued he must have known he could not finish. Even the failure to pass earmarked funds to a supplier, standing alone, remained a failure to perform the promise governing those funds. The State’s reply brief invoked the cumulative improbability of repeated failures, analogizing to the former doctrine of chances. The court declined to reach that theory because it raised a new issue not developed in the opening brief. Without probable cause on the three predicate theft charges, the pattern-of-unlawful-activity charge necessarily failed as well.
Key Takeaways
- At a Utah preliminary hearing, a broken contractual promise alone cannot establish theft by deception; the statute requires other evidence of deceptive intent or knowledge.
- The critical timing is when the defendant obtained the property, so evidence of later collapse or abandonment must be linked to the defendant’s earlier state of mind.
- A new cumulative-conduct theory raised for the first time in a reply brief is waived, even when it might offer a different way to infer intent.
Why It Matters
The opinion draws a firm line between criminal fraud and civil nonperformance in Utah construction disputes. Incomplete work, unhappy customers, unpaid vendors, and even repeated project failures may support civil remedies or licensing consequences, but prosecutors still need evidence beyond the unfulfilled promise itself. Useful evidence might include contemporaneous false statements, diversion coupled with proof of intent, or proof that the contractor knew performance was impossible when payment was sought.
For defense counsel, the decision provides a statutory framework for testing probable cause project by project and payment by payment. For prosecutors, it underscores the need to develop the state-of-mind theory in the opening brief and at the preliminary hearing rather than relying on the number of failed transactions to carry the inference. Business litigators should likewise be careful not to equate breach, even an egregious breach, with criminal deception.