State of Minnesota vs. Kristyn Nicole Schouweiler

In February 2015, Schouweiler issued a check in the amount of $1,969.07 to the

Wabasha County Auditor/Treasurer for past-due property taxes payable in 2014. The

check was not honored by Schouweiler’s bank, which returned it for insufficient funds.

The County Auditor/Treasurer mailed a notice to Schouweiler, informing her that she had

5 days to make a valid payment, but she failed to do so.

Schouweiler was charged with issuance of a dishonored check, Minn. Stat.

§ 609.535, subd. 2. Schouweiler challenged the probable cause underlying the complaint

and moved to dismiss it, arguing that her check fit within the statutory exception for “a

check given for a past consideration,” id., subd. 5. After a hearing, the district court

dismissed the criminal complaint, holding that Schouweiler’s check for past-due property

taxes was “a check given for a past consideration,” id., because there was no

contemporaneous exchange of goods or services for the check. It reasoned that the purpose

of the dishonored-check statute was “to protect the person who would not have given the

goods to the defendant but for the contemporaneous delivery of the check.”

The court of appeals reversed. Observing that the phrase “past consideration” has

a special meaning in contract law, the court of appeals held that the past-consideration

exception “refers to a promise to pay that is unenforceable for lack of adequate

consideration.” State v. Schouweiler, No. A15-1461, 2016 WL 102578, at *2-3 (Minn.

App. Jan. 11, 2016). Because Schouweiler wrote the check to fulfill a statutory obligation

to pay taxes, and not to honor an unenforceable contractual obligation, the court of appeals

concluded that the check was not “given for a past consideration.” Id. at *3. Schouweiler

sought review by this court, once again contending that her issuance of a check for past

due property taxes was “a check given for a past consideration.” We granted review.

II.

We begin with an overview of the statute. The dishonored-check statute provides:

“Whoever issues a check which, at the time of issuance, the issuer intends1 shall not be

paid, is guilty of issuing a dishonored check.” Minn. Stat. § 609.535, subd. 2. But the

Legislature created exceptions to the dishonored-check statute: “This section does not

apply to a postdated check or to a check given for a past consideration, except a payroll

check or a check issued to a fund for employee benefits.” Id., subd. 5.

Schouweiler’s sole contention is that her check was “given for a past consideration”

and is therefore subject to the exception in the dishonored-check statute. To resolve this

issue, first we must decide whether the phrase “past consideration” has a plain or technical

meaning. Then we must decide whether a check given to pay a property tax obligation is

“given for a past consideration.”

A.

We begin with the phrase “past consideration.” Schouweiler argues that “past

consideration” plainly refers to a valuable good or service that the check issuer received in

the past. Quoting a Wisconsin Court of Appeals decision that interprets a dishonored

check statute nearly identical to Minnesota’s statute, Schouweiler argues that the past

consideration exception includes “checks given either for services already performed or

for goods already received.” See State v. Archambeau, 523 N.W.2d 150, 151-52 (Wis. Ct.

App. 1994) (quoting 66 Op. Wis. Att’y Gen. 168, 174 (1977)).

The State contends that the phrase “past consideration” is a contractual term of art.

Because Schouweiler’s tax payment arises from a statutory obligation, not a contractual

one, the State argues, her check could not have been “given for a past consideration.”

The meaning of the past-consideration exception is a question of law, which we

review de novo. Ekdahl v. Indep. Sch. Dist. No. 213, 851 N.W.2d 874, 876 (Minn. 2014).





5



The purpose of statutory interpretation is to ascertain the intent of the Legislature.

Christianson v. Henke, 831 N.W.2d 532, 536 (Minn. 2013). We generally interpret words

and phrases according to their common and ordinary meaning, but we interpret technical

words and phrases according to their special, technical meaning. Staab v. Diocese of

St. Cloud, 813 N.W.2d 68, 72 (Minn. 2012); accord Minn. Stat. § 645.08(1) (2014). To

decide whether words in a statute have a technical meaning or an ordinary meaning, we

consider the context in which the phrase appears. State v. Rick, 835 N.W.2d 478, 484

(Minn. 2013). We interpret a statute “as a whole so as to harmonize and give effect to all

its parts, and where possible, no word, phrase, or sentence will be held superfluous, void,

or insignificant.” Jackson v. Mortg. Elec. Registration Sys., Inc., 770 N.W.2d 487, 496

(Minn. 2009) (quoting In re United Health Grp. Inc., 754 N.W.2d 544, 563 (Minn. 2008));

see also Minn. Stat. § 645.16 (2014).

In ordinary, nonlegal speech, the word “consideration” means a payment given as

compensation for a good or service. See Webster’s Third New International Dictionary of

the English Language Unabridged 484 (2002) (defining “consideration,” in part, as

“something given as recompense: as . . . payment, reward”); see also The American

Heritage Dictionary of the English Language 392 (5th ed. 2011) (defining “consideration,”

in part, as “[p]ayment given in exchange for a service rendered; recompense”). “Past,” of

course, refers to something that has “existed or occurred in an earlier time.” The American

Heritage Dictionary 1290. “A check given for a past consideration” would then refer,

according to its common and ordinary meaning, to a check given as payment for something

of value received in the past.





6



As a contractual term of art, however, the phrase “past consideration” has a different

meaning. “Consideration” is an act or forbearance that induces a contractually binding

promise. See Consideration, Black’s Law Dictionary (10th ed. 2014). But when the act or

forbearance was given before the return promise was made, the act or forbearance is called

“past consideration.” See id. Because a “past consideration” does not actually induce a

return promise, a promise given for “past consideration” is not legally binding. See 4

Richard A. Lord, Williston on Contracts § 8:11 (4th ed. 2008); see also Lamprey v.

Lamprey, 29 Minn. 151, 155, 12 N.W. 514, 515 (1882).

The surrounding text of subdivision 5 shows that the Legislature intended for the

phrase “past consideration” to be given its ordinary meaning, not its technical meaning.

Stated in full, subdivision 5 provides: “This section does not apply to a postdated check or

to a check given for a past consideration, except a payroll check or a check issued to a fund

for employee benefits.” Minn. Stat. § 609.535, subd. 5 (emphasis added).

Subdivision 5 has two layers. The first clause—“[t]his section does not apply to a

postdated check or to a check given for a past consideration”—creates an exception to the

dishonored-check statute. Id. The second clause—“except a payroll check or a check

issued to a fund for employee benefits”—creates an exception to the exception. Id.

Consequently, a check issued for payroll or benefits first must qualify as a “check given

for past consideration” to avoid rendering the payroll-check and employee-benefit-check

exceptions mere surplusage.

If we interpreted the phrase “past consideration” according to its technical meaning,

the exceptions for “a payroll check” and “a check issued to a fund for employee benefits”





7



would make little sense. An employee’s pay and benefits are typically bargained for when

an employment agreement is made and, therefore, are not “past consideration” under

contract law.2 We cannot give effect to each word of the statute unless the phrase “past

consideration” is interpreted according to its common and ordinary meaning. Accordingly,

we hold that the exception for “a check given for a past consideration” in subdivision 5

refers to any check given in payment for a good or service that was received in the past.

Such a check does not give rise to criminal liability under the dishonored-check statute.

This interpretation of the phrase “a past consideration” is supported by a decision

of the Wisconsin Court of Appeals that discusses several Wisconsin Attorney General

opinions that interpret an almost identical statutory exception. Archambeau, 523 N.W.2d

at 151; see Wis. Stat. Ann. § 943.24(4) (West 2015) (“This section does not apply to a

postdated check or to a check given for a past consideration, except a payroll check.”).3



2 The dissent suggests the possibility of payroll or employee benefit payments that are not bargained for, such as a holiday bonus or a spontaneous profit share. These kinds of checks would fall outside the scope of the statute. The plain meaning of “a payroll check or a check issued to a fund for employee benefits” requires a scheme of compensation. The American Heritage Dictionary of the English Language 1296 (5th ed. 2011) (defining “payroll,” in part, as “[a] list of employees receiving wages or salaries, with the amounts due to each” (emphasis added)); id. at 168 (defining “benefit,” in part, as “[a] form of compensation . . . provided to employees in addition to wages or salary as part of an employment arrangement” (emphasis added)). In these definitions, the checks are issued for payroll or benefits owed to the employee. Thus, a check meeting the contractual definition of “past consideration,” such as a gratuitous holiday bonus, would not fall within the plain meaning of a “payroll check.”



3 The Wisconsin statute was enacted in 1955. Act of Dec. 24, 1955, ch. 696, 1955 Wis. Sess. Laws 974, 992 (codified as amended at Wis. Stat. Ann. § 943.24 (West 2015)). When the Minnesota Legislature first enacted the statute at issue in this case in 1963, it used an identical exception. Compare Act of May 17, 1963, ch. 753, 1963 Minn. Laws





8



Noting that a payroll check “usually follows an agreement as to the terms of employment,

form of compensation, and the actual performance of the work,” 66 Op. Wis. Att’y Gen.

168, 175 (1977), the Wisconsin Attorney General concluded that the phrase “past

consideration” was not a legal term of art, but rather covered payments for “services

already performed or goods already received, or for a past due obligation.” Id. at 174.

Here the State argues, and the court of appeals concluded, that interpreting the

phrase “past consideration” according to its common and ordinary meaning effectively

eliminates criminal liability for checks that are issued for delayed or past-due payments,

which is an absurd result. Schouweiler, 2016 WL 102578, at *3. We disagree.

When construing a statute, we presume that the Legislature did not intend an absurd

or unreasonable result. Minn. Stat. § 645.17(1) (2014). But this canon is not applicable

“except in an exceedingly rare case in which the plain meaning of the statute ‘utterly

confounds’ the clear legislative purpose of the statute.” Schatz v. Interfaith Care Ctr., 811



1185, 1220 (codified as amended at Minn. Stat. § 609.535, subd. 5 (2014)) (“This section does not apply to a postdated check or to a check given for a past consideration, except a payroll check.”), with Act of Dec. 24, 1955, 1955 Wis. Sess. Laws at 993 (“This section does not apply to a postdated check or to a check given for a past consideration, except a payroll check.”). The employee benefit fund exclusion was added to Minnesota’s law in 1967. Act of May 16, 1967, ch. 466, § 1, 1967 Minn. Laws 996, 996-97 (codified as amended at Minn. Stat. § 609.535, subd. 5 (2014)). From the timing and the identical statutory language, we can reasonably infer that the Minnesota statute was modeled after Wisconsin’s statute.







9



N.W.2d 643, 651 (Minn. 2012) (quoting Weston v. McWilliams & Assocs., Inc., 716

N.W.2d 634, 639 (Minn. 2006)).4

Our interpretation of the dishonored-check statute does not confound any clear

legislative purpose. When the Legislature enacted the dishonored-check statute, including

the past-consideration exception, it may have intended to criminally punish only the

issuance of a worthless check that actually induced the other party to provide a good or

service to the issuer of the check. The Legislature may have concluded that the physical

presence of a check at the time of exchange would be more likely to induce the immediate

delivery of goods or services than a mere promise by the issuer to write a check at a later

date.5

Moreover, when someone writes a worthless check to pay a debt already owed, the

relationship of the parties does not change; the party who wrote the check still owes the

payment. In this case, the dishonored check that Schouweiler issued did not change the

position of the government. The government remained legally entitled to Schouweiler’s

past-due taxes, just as it was before the check issued. And the government retained the



4 This canon has been dispositive only once in our jurisprudence. Schatz, 811 N.W.2d at 651; see Wegener v. Comm’r of Revenue, 505 N.W.2d 612 (Minn. 1993).



5 The State contends that our interpretation incorrectly reads the element of swindle into the dishonored-check statute and, therefore, conflates the crime of issuing a dishonored check with the crime of theft-by-check, Minn. Stat. § 609.52, subd. 2(a)(3)(i) (2014). The State is incorrect. The two crimes have different intent requirements, State v. Cox, 798 N.W.2d 517, 519 (Minn. 2011) (citing State v. Roden, 384 N.W.2d 456, 457 (Minn. 1986)), and our interpretation of the phrase “past consideration” does not affect the element of intent.







10



same legal recourse against Schouweiler for failure to pay her property taxes that existed

before the check was dishonored.6 The State’s absurd-results argument is insufficient to

overcome the common and ordinary meaning of the phrase “past consideration.”

B.

Having decided that the exception for “a check given for a past consideration” refers

to a check that was given for goods or services received in the past, the question remains

whether Schouweiler’s check fits the past-consideration exception. Property owners have

a statutory obligation to pay taxes, see Minn. Stat. § 272.01, subd. 1 (2014), and it is

undisputed that tax payments fund government services. Schouweiler argues that her check

for property taxes reimbursed the county for government services received only during the

previous year. The State contends that county services are received on an ongoing basis

and not entirely received in the past.

The State is correct that a payment for property taxes funds both past and future

government services. See Minn. Dep’t of Revenue, Understanding Property Taxes:

Property Tax Fact Sheet 12a (2011),

http://www.revenue.state.mn.us/propertytax/factsheets/factsheet_12a.pdf (describing the



6 Several statutes give the government specific recourse when a taxpayer fails to pay property taxes. See Minn. Stat. § 279.01, subd. 1 (2014) (imposing penalties for delinquent property taxes); Minn. Stat. §§ 280.001-.43 (2014) (providing for forfeiture of real estate due to unpaid taxes). Notably, these remedies do not include criminal prosecution. Compare Minn. Stat. § 289A.63, subd. 1 (2014) (imposing criminal penalties for tax evasion), with Minn. Stat. § 289A.01 (2014) (stating that chapter 289A applies to laws administered under various chapters without listing the chapters governing delinquent property taxes).





But by March 31 every year, the County Treasurer’s Office mails a tax statement to

each property owner that provides an itemized list of the property tax due to taxing

authorities. Minn. Dep’t of Revenue, supra, at 2. This statement informs taxpayers that

they are paying a specific amount of money for the county, an amount for the city (for

those who live in one), and an amount for local schools, among other items. Id. A

layperson may reasonably view the property tax payment as confirming a payment of

money for, among other things, a variety of received and soon-to-be-received public

services.





12



Because property taxes may be reasonably understood to support public services,

and Schouweiler presumably received at least some of these services—fire and police

protection or snow removal, for example—by the time she issued her check for the past

year’s property taxes, her check was given for a past consideration. Accordingly,

Schouweiler’s check was subject to the exception in Minn. Stat. § 609.535, subd. 5.7