PROBATION TERMS FOR TAX EVASION CONVICTION DO NOT INCLUDE PAYMENT OF ALL BACK TAXES.

                            MEMORANDUM *

Pursuant to a plea agreement, defendant-appellant Norman R. Adams ("Adams") pled guilty to one count of conspiracy to defraud the Internal Revenue Service ("IRS"), 18 U.S.C. section 371 (1988); four counts of evasion of employer's taxes, 26 U.S.C. section 7201 (1988); three counts of failure to file tax returns, 26 U.S.C. section 7203 (1988); and two counts of tax evasion, 26 U.S.C. section 7201 (1988). The remaining charges in the eighty-eight count indictment were dismissed. Adams received a sentence of two consecutive five-year terms of incarceration, a $20,000 fine, and a five-year period of probation. On appeal in this pre-Sentencing Guidelines case, Adams contends the Government breached the plea agreement and the sentencing court imposed improper conditions of probation. We affirm.

I. PLEA AGREEMENT

Adams contends the Government breached the plea agreement by failing to "remain silent" on whether consecutive prison terms should be imposed. Although this plea bargain issue was raised for the first time on appeal, we exercise our discretion to consider it. See, e.g., United States v. Greger, 716 F.2d 1275, 1277 (9th Cir. 1983), cert. denied, 465 U.S. 1007 (1984).

We construe a plea agreement under contract law principles. United States v. Read, 778 F.2d 1437, 1441 (9th Cir. 1985), cert. denied, 479 U.S. 835 (1986). The Government is held to the literal terms of the plea agreement. United States v. Travis, 735 F.2d 1129, 1132 (9th Cir. 1984).

Upon consideration of the plea agreement, the remarks at the sentencing hearing, and the sentencing memoranda, we conclude the Government did not breach the plea agreement. Under the terms of the plea agreement, the Government expressly "retain[ed] the right to fully exercise all other sentencing options." The Government statements in support of the accuracy of the Probation Report were in direct response to Adams' factual challenges. Further, in light of the probation officer's recommendation for consecutive sentences, the Government repeatedly noted its obligation to "remain silent" on the consecutive sentence issue. Accordingly, the prosecutor noted his approval of the probation officer's report while observing he could not comment on the consecutive sentences recommendation.

II. PROBATION CONDITIONS

On five of the ten counts to which Adams pled guilty, his sentence was suspended. For these five counts, he was placed on probation for five years upon his release from confinement subject to, inter alia, the probation condition "That he pay all federal taxes, penalties and interest that are due and owing." On appeal, Adams challenges the condition of probation requiring the payment of back taxes as improper because the district court failed to limit the payment of back taxes "to either the offenses of conviction or the years of indictment." ¹

The authority of the district court to impose probation conditions on offenses committed before November 1, 1987, as here, is governed by 18 U.S.C. section 3651 (1982). ² The legality of a criminal sentence is reviewed de novo. United States v. Koenig, 813 F.2d 1044, 1046 (9th Cir. 1987). However, the district court has "broad discretion" to impose probation conditions as long as its authority does not exceed statutory limitations. United States v. Jenkins, 884 F.2d 433, 439 (9th Cir.), cert. denied, 110 S. Ct. 568 (1989); see also Koenig, 813 F.2d at 1046.

This issue is controlled by United States v. Green, 735 F.2d 1203 (9th Cir. 1984). As here, Green involved a plea for failure to file tax returns where the defendant was required, as a condition of probation, to pay "all taxes due and owing." Id. at 1205. We held that section 3651 permitted a probation condition requirement of payment of back taxes subject to the amount of outstanding tax liability for the years involved in the conviction. Id. at 1205, 1206.

As in Green, we construe the judgment order language here concerning tax obligations "due and owing" "as a reference to taxes due for the years involved in the conviction." Id. at 1205. Therefore, the phrase "due and owing" is limited to the dates of the suspended sentence counts to which this probation condition attached.

AFFIRMED.

¹ In his brief and at oral argument, Adams limited his appeal to the fourth probation condition concerning the PAYMENT of back taxes. He does not challenge the third probation condition requiring the FILING of tax returns beyond the dates of the suspended sentence counts.

² This provision was repealed effective November 1, 1987. See Pub. L. No. 98-473, Title II, c. II, section 212(a)(2) (Oct. 12, 1984), 98 Stat. 1987, as amended, Pub. L. No. 99-217, section 4 (Dec. 26, 1985), 99 Stat. 1728.