When does a contractor's failure to perform become theft by deception in Utah? State v. Conde Explained

Background and facts

Carl Anthony Conde entered into separate pool-construction contracts with three homeowners—Barbara, Ronald, and Hank—collecting a combined total of hundreds of thousands of dollars in phased payments. Across all three projects, Conde performed incomplete or substandard work, failed to pay subcontractors, abandoned job sites, and stopped communicating with his clients. In 2024, the State charged Conde with three counts of theft by deception under Utah Code § 76-6-405 and one count of engaging in a pattern of unlawful activity under Utah Code § 76-17-407. After a preliminary hearing, the magistrate declined to bind Conde over on any charge, finding the evidence established bad business practices but not the requisite criminal intent. The State appealed.

Key legal issues

The central question was whether the State met its probable cause burden at the bindover stage—specifically, whether evidence of abandonment, substandard work, misdirected earmarked funds, false statements about minor project components, and poor communication could support a reasonable inference that Conde lacked intent to perform at the time each payment was obtained. The court also addressed whether the State’s cumulative-conduct argument—that repeated failures across three contracts collectively supported an inference of deception—was properly preserved for appeal.

Court’s analysis and holding

The Utah Court of Appeals affirmed. The court emphasized that under Utah Code § 76-6-401(1)(e), failure to perform a promise, without other evidence of intent or knowledge, is not sufficient proof of deception. Applying this statutory limit, the court held that evidence of abandonment amounts only to non-performance; substandard or faulty workmanship does not support an inference of a prior intent not to perform; poor communication after on-the-ground performance has commenced does not demonstrate fraudulent intent at contracting; and misdirection of earmarked funds, standing alone, similarly falls short of probable cause. The court further held that the deception must exist at the time the property is obtained, citing State v. Lakey, 659 P.2d 1061 (Utah 1983), which proved fatal to the State’s theory as to later renegotiation payments where Conde received no additional funds after the point the State claimed he knew he could not finish. The court declined to reach the State’s novel cumulative-conduct argument—grounded in the logic of the now-retired doctrine of chances—because it was raised for the first time in the reply brief and was therefore waived. Because probable cause failed on all three theft-by-deception counts, the pattern-of-unlawful-activity charge necessarily failed as well.

Practice implications

For prosecutors, State v. Conde underscores that a theft-by-deception case built on contractor misconduct requires affirmative evidence—beyond non-performance—that fraudulent intent existed at the moment of contracting or payment. Consider front-loading investigation into financial records, prior similar schemes, or admissions that predate the contract. For defense counsel, the opinion reinforces that commercial misfortune is not a crime and that the probable cause standard, properly applied, is not a rubber stamp. Finally, all appellate practitioners should note the court’s strict enforcement of the rule against raising new issues in a reply brief: substantive arguments omitted from the opening brief are waived, regardless of their potential merit.