Opinion
Docket No. 328547.
08-02-2016
In re FORFEITURE OF 2000 GMC DENALI AND CONTENTS.
William A. Forsyth, Prosecuting Attorney, Timothy K. McMorrow, Chief Appellate Attorney, and T. Lynn Hopkins, Assistant Prosecuting Attorney, for the city of Grand Rapids. Pinsky, Smith, Fayette & Kennedy, LLP, Grand Rapids (by Sarah Riley Howard ), for Shantrese Kinnon.
William A. Forsyth, Prosecuting Attorney, Timothy K. McMorrow, Chief Appellate Attorney, and T. Lynn Hopkins, Assistant Prosecuting Attorney, for the city of Grand Rapids.
Pinsky, Smith, Fayette & Kennedy, LLP, Grand Rapids (by Sarah Riley Howard ), for Shantrese Kinnon.
Before: MURRAY, P.J., and SAWYER and METER, JJ.
MURRAY, P.J.One of the most important principles contained in our federal Constitution is that neither the state nor federal governments can deprive citizens of their property without first providing them with due process of law. U.S. Const. Ams. V and XIV. That principle is put to the test here, where the claimant, Shantrese Kinnon, was precluded from fully challenging the government's seizing of her property, and later declaring it forfeited, without an opportunity to contest the action. Kinnon was unable to contest the seizure and resulting forfeiture of certain property because she could not afford to post the bond required by statute. She now appeals as of right the judgment of forfeiture. We affirm in part, reverse in part, and remand for further proceedings.I. FACTS AND PROCEDURAL HISTORY
Claimant's husband, Quinton Kinnon (Quinton), was arrested after he was seen by Grand Rapids Police Officers Tyler Smith and Lucas Nagtzaam engaging in a hand-to-hand drug transaction with an unidentified person. Upon arrest, Officer Nagtzaam retrieved from Quinton's person a bag containing hydrocodone pills. When confronted about the contents of the bag, Quinton told Officer Nagtzaam that the pills were Vicodin and belonged to someone else. Quinton was also in possession of keys to a blue Cadillac, which was subsequently impounded and held for possible forfeiture.
After Quinton was arrested, Officer Ernest Stafford, familiar with Quinton as one of the "main suppliers" of drugs in the area, obtained a search warrant for Quinton's home. When executing the search warrant, officers found in the basement of the house a marijuana growing operation, which led to the seizure of 19 marijuana plants. In the kitchen, officers found measuring containers containing crack cocaine residue, two sandwich bags containing marijuana residue, and a sandwich bag containing a quarter ounce of marijuana. While executing the search warrant, officers seized a 2000 GMC Denali, a 1986 Chevrolet El Camino, a 2002 YZFR motorcycle, a Nexus tablet, and a Compaq laptop computer.
As a result of the search of her home, claimant was arrested. Upon claimant's arrest, $398 was seized from her purse. Claimant was subsequently charged with manufacturing marijuana, MCL 333.7401(2)(d)(iii ), and maintaining a drug house, MCL 333.7405(d), while at the same time, Quinton was charged with possession with the intent to deliver a controlled substance, MCL 333.7401(1), and maintaining a drug house.
Quinton and claimant were served with the required notices by plaintiff, the city of Grand Rapids, of its intent to forfeit the property that was seized. See MCL 333.7523(1)(a). Quinton did not post a bond on any of the property, and more than 20 days after receiving the notice, any interest he held in the items seized was administratively forfeited. See MCL 333.7523(1)(d). Claimant, however, did post a bond, but not the full amount to contest all the seized property. To be able to contest the validity of the forfeiture of all the property, claimant was required to post a $2,005 bond, but according to claimant, she could only afford to post a bond of approximately $1,100, as a result of her indigency. Detective Preston informed claimant that because she did not have sufficient funds to contest all the seized property, she would have to select items that she could afford to contest. As a result, claimant did not post a bond for the Cadillac, which required a $1,020 bond.
More than 20 days after claimant received her notice, plaintiff filed a complaint for forfeiture asserting that the 1986 El Camino, the 2000 GMC Denali, the motorcycle, the Compaq laptop computer, the Nexus tablet, and the $398 in cash were subject to forfeiture because the items were used or intended to be used to facilitate, or were proceeds from, a violation of the Controlled Substances Act, MCL 333.7201 et seq.
After denying the allegations in the complaint and obtaining counsel, claimant filed a motion to intervene seeking to add the Cadillac to the proceedings on the basis that the bond requirement denied her access to the courts and that she was denied an opportunity to be heard because she could not afford the bond requirement. Claimant also asserted that the bond requirement violated her right to equal protection because it allowed individuals with resources to contest forfeitures, while denying those without financial resources such an opportunity. Claimant requested that she be allowed to contest the forfeiture of her Cadillac without posting a bond.
In response, plaintiff argued that Michigan's civil asset forfeiture scheme was constitutional. Specifically, plaintiff relied on People v. Any and All Monies, unpublished opinion per curiam of the Court of Appeals, issued November 12, 1996 (Docket No. 185677), 1996 WL 33348848, for the proposition that the statute did not infringe on an indigent claimant's right to due process or equal protection. In addition, plaintiff asserted that while the Michigan statute does not have a provision allowing for waiver of the bond requirement, a claimant may still petition the court under MCR 2.109(B)(1) to waive the bond requirement.
Plaintiff never questioned claimant's inability to pay the full bond amount.
The trial court heard arguments on claimant's motion to intervene and, relying on Any and All Monies, held that the forfeiture statute was constitutional. The trial court subsequently entered an order denying claimant's motion to intervene.
The case then proceeded to trial. After receiving evidence and entertaining arguments, the trial court found that plaintiff failed to establish a connection between the criminal activity and the $398 in cash found in claimant's purse at the time of her arrest, the El Camino, the Compaq laptop computer, and the Nexus tablet. On the other hand, the trial court found that a significant nexus existed between the underlying criminal activity, the Denali, and the motorcycle. In addition, the trial court found that the innocent-owner defense was inapplicable because claimant was not the owner of the vehicles and because she had knowledge of the criminal activity. The trial court thereafter entered a judgment of forfeiture, forfeiting the 2000 GMC Denali and the motorcycle. This appeal ensued.
II. ANALYSIS
A. CONSTITUTIONALITY OF MICHIGAN'S CIVIL ASSET FORFEITURE SCHEME
Claimant asserts that the trial court abused its discretion by denying her motion to intervene because in doing so, she was denied due process and equal protection of the law. More specifically, she argues that Michigan's bond requirement, as applied to her, deprived her of her property rights in the 2006 Cadillac without according her an opportunity to be heard solely because she could not afford the statutorily required bond.1. CONSTITUTIONAL REVIEW
"This Court reviews for abuse of discretion a trial court's decision on a motion to intervene." Vestevich v. West Bloomfield Twp., 245 Mich.App. 759, 761, 630 N.W.2d 646 (2001). This case also presents constitutional issues and issues of statutory interpretation, both of which are reviewed de novo. Midland Cogeneration Venture Ltd. Partnership v. Naftaly, 489 Mich. 83, 89, 803 N.W.2d 674 (2011).
A party challenging the constitutionality of a statute has the burden of proving the law's invalidity. Gillette Commercial Operations North America & Subsidiaries v. Dep't of Treasury, 312 Mich.App. 394, 414–415, 878 N.W.2d 891 (2015). The challenging party must overcome a heavy burden because "[s]tatutes are presumed to be constitutional, and we have a duty to construe a statute as constitutional unless its unconstitutionality is clearly apparent." Mayor of Cadillac v.
Blackburn, 306 Mich.App. 512, 516, 857 N.W.2d 529 (2014). When interpreting a statute, our primary goal is to "give effect to the intent of the Legislature." Superior Hotels, LLC v. Mackinaw Twp., 282 Mich.App. 621, 628, 765 N.W.2d 31 (2009). To do so, we examine the plain language of the statute itself, and "[i]f the language of a statute is clear and unambiguous, the statute must be enforced as written and no further judicial construction is permitted." Whitman v. City of Burton, 493 Mich. 303, 311, 831 N.W.2d 223 (2013).
A constitutional challenge to the validity of a statute can be brought in one of two ways: by either a facial challenge or an as-applied challenge. This is an as-applied challenge, meaning that claimant has alleged " ‘a present infringement or denial of a specific right or of a particular injury in process of actual execution’ of government action." Bonner v. City of Brighton, 495 Mich. 209, 223 n. 27, 848 N.W.2d 380 (2014), quoting Village of Euclid v. Ambler Realty Co., 272 U.S. 365, 395, 47 S.Ct. 114, 71 L.Ed. 303 (1926). "The practical effect of holding a statute unconstitutional ‘as applied’ is to prevent its future application in a similar context, but not to render it utterly inoperative." Ada v. Guam Society of Obstetricians and Gynecologists, 506 U.S. 1011, 1012, 113 S.Ct. 633, 121 L.Ed.2d 564 (1992)(Scalia, J., dissenting). See also United States v. Frost, 125 F.3d 346, 370 (C.A.6, 1997).
According to the Court in Washington State Grange v. Washington State Republican Party, 552 U.S. 442, 450–451, 128 S.Ct. 1184, 170 L.Ed.2d 151 (2008), "[f]acial challenges ... run contrary to the fundamental principle of judicial restraint that courts should neither ‘anticipate a question of constitutional law in advance of the necessity of deciding it’ nor ‘formulate a rule of constitutional law broader than is required by the precise facts to which it is to be applied.’ " Quoting Ashwander v. TVA, 297 U.S. 288, 346–347, 56 S.Ct. 466, 80 L.Ed. 688 (1936) (Brandeis, J., concurring), quoting Liverpool, New York & Philadelphia Steamship Co. v. Comm'rs of Emigration, 113 U.S. 33, 39, 5 S.Ct. 352, 28 L.Ed. 899 (1885) (some quotation marks omitted). Finally, facial challenges threaten to short circuit the democratic process by preventing laws embodying the will of the people from being implemented in a manner consistent with the Constitution. We must keep in mind that " ‘[a] ruling of unconstitutionality frustrates the intent of the elected representatives of the people.’ " Ayotte v. Planned Parenthood of Northern New England, 546 U.S. 320, 329, 126 S.Ct. 961, 163 L.Ed.2d 812 (2006) (alteration in original), quoting Regan v. Time, Inc., 468 U.S. 641, 652, 104 S.Ct. 3262, 82 L.Ed.2d 487 (1984) (plurality opinion).
2. MICHIGAN'S FORFEITURE LAW
Under Michigan's civil asset forfeiture scheme, "a conveyance"—which includes a vehicle—"used or intended for use, to transport, or in any manner to facilitate the transportation, for the purpose of sale or receipt of [a controlled substance]" is subject to forfeiture. MCL 333.7521(1)(d). Property that is subject to forfeiture may be seized without process when it is seized incident to a lawful arrest or pursuant to a search warrant. MCL 333.7522(a). When property is seized without process, and the total value of the property seized does not exceed $50,000, the local unit of government that seized the property shall notify the owner of the property that the property has been seized and that the local unit of government intends to forfeit and dispose of the property by delivering a written notice to the owner of the property or by sending the notice to the owner by certified mail. MCL 333.7523(1)(a).Within 20 days after receiving the notice, any person claiming an interest in the property must file a written claim and a bond with the local unit of government in the amount of 10% of the value of the claimed property, but the bond may not be less than $250 or greater than $5,000. MCL 333.7523(1)(c). When a claim and bond are posted, the prosecuting attorney "shall promptly institute forfeiture proceedings after the expiration of the 20–day period." Id. However, when no claim is filed or when no bond is given within the 20–day period, the "local unit of government shall declare the property forfeited...." MCL 333.7523(1)(d). By force of the statute, the only means of obtaining a judicial hearing is to file a written claim asserting an interest in the property and to post a bond. In re Return of Forfeited Goods, 452 Mich. 659, 667, 550 N.W.2d 782 (1996). As such, posting a bond is a condition to obtaining a judicial hearing regarding the forfeiture of seized property.
If the name and address of the owner are not reasonably ascertainable, or delivery of the notice cannot be reasonably accomplished, the notice shall be published for 10 successive publishing days in a newspaper of general circulation in the county in which the property was seized. MCL 333.7523(1)(a).
3. PROCEDURAL DUE PROCESS
That the Founding Fathers were concerned with protecting private property rights from government interference is beyond dispute. " ‘[O]ur founding fathers and their contemporary patriots were as much interested in protecting citizens' private property rights against encroachments by government as they were in liberty itself.’ " United Artists Theater Circuit, Inc. v. Philadelphia Historical Comm'n, 528 Pa. 12, 25, 595 A.2d 6 (1991), quoting First Presbyterian Church of York v. York City Council, 25 Pa.Cmwlth. 154, 164, 360 A.2d 257 (1976) (Kramer, J., concurring) (alteration in original). Accord WJF Realty Corp. v. New York, 176 Misc.2d 763, 764, 672 N.Y.S.2d 1007 (1998) ("At the time of our Revolution, one of our Founding Fathers specifically declared the commonly held belief that, ‘ [t]he right of property is the guardian of every other right, and to deprive the people of this, is in fact to deprive them of their liberty,’ (Belz, Property and Liberty Reconsidered, 45 Vand L Rev 1015, 1016–1017 [1992] ), citing Ely, The Guardian of Every Other Right, at 26 [Oxford 1992], quoting Lee, An Appeal to the Justice and Interests of the People of Great Britain, in The Present Dispute with America, at 14 [4th ed. 1775].") (alterations in original; quotation marks omitted). John Adams succinctly declared that " [p]roperty must be secured, or liberty cannot exist." Kaselonis, The Greater Good? Can the Good v. United States Court Be Any Further Off?, 15 Regent U L Rev 253, 264 (2003), quoting VI Adams, The Works of John Adams (Boston: Little & Brown, 1851), p. 280.
Because of the important role property rights have always played in our society, Alexander Hamilton (along with James Madison and John Jay) wrote the Federalist Papers in part to inform the citizenry of the " ‘additional security, which ... [the Constitution's] adoption will afford to the preservation of ... property.’ " The Greater Good?, 15 Regent U L Rev at 264, quoting The Federalist No. 1 (Alexander Hamilton) (alteration in original). One of the constitutional provisions intended to preserve private property rights against government encroachment is the Due Process Clause. See Block v. Hirsh, 256 U.S. 135, 165, 41 S.Ct. 458, 65 L.Ed. 865 (1921) (McKenna, J., dissenting) ("The security of property, next to personal security against the exertions of government, is of the essence of liberty. They are joined in protection, as we have shown, and both the National Government (Fifth Amendment) and the States (Fourteenth Amendment) are forbidden to deprive any person ‘of life, liberty, or property, without due process of law....’ "); United States v. Twelve Thousand, Three Hundred Ninety
Dollars, 956 F.2d 801, 810 (C.A.8, 1992) ("From its inception, the Constitution recognized the importance of private property as a concomitant to liberty. The Fifth Amendment embodies the Lockean belief that liberty and the right to possess property are an interwoven whole; neither life, liberty, nor property can be arbitrarily or capriciously denied us by government.").
The Due Process Clause of the Fourteenth Amendment provides that "[no] State [shall] deprive any person of life, liberty, or property, without due process of law...." U.S. Const. Am. XIV. While courts have expanded this language by interpreting it to contain a substantive component, see, e.g., In re Sanders, 495 Mich. 394, 409, 852 N.W.2d 524 (2014), our inquiry revolves around the original purpose of the Due Process Clause—the procedural requirements meant to protect persons "from the mistaken or unjustified deprivation of life, liberty, or property." Zinermon v. Burch, 494 U.S. 113, 125–126, 110 S.Ct. 975, 108 L.Ed.2d 100 (1990) (quotation marks and citation omitted). In order to comply with the procedural requirements of the Due Process Clause, "individuals must receive notice and an opportunity to be heard before the Government deprives them of property." United States v. James Daniel Good Real Prop., 510 U.S. 43, 48, 114 S.Ct. 492, 126 L.Ed.2d 490 (1993). See also United States v. $8,850, 461 U.S. 555, 562 n. 12, 103 S.Ct. 2005, 76 L.Ed.2d 143 (1983), and Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 313, 70 S.Ct. 652, 94 L.Ed. 865 (1950). "The purpose of this requirement is not only to ensure abstract fair play to the individual. Its purpose, more particularly, is to protect his use and possession of property from arbitrary encroachment—to minimize substantively unfair or mistaken deprivations of property...." Fuentes v. Shevin, 407 U.S. 67, 80–81, 92 S.Ct. 1983, 32 L.Ed.2d 556 (1972).
Due process concerns arise when state legislatures condition access to the courts on posting a bond or paying a filing fee. See, e.g., MLB v. SLJ, 519 U.S. 102, 113, 117 S.Ct. 555, 136 L.Ed.2d 473 (1996) (due process "prohibit[s] a State from denying, solely because of inability to pay, access to its courts" when a judicial proceeding is necessary to vindicate a fundamental right) (alteration in original). More specifically, while "[t]he State may erect reasonable procedural requirements for triggering the right to an adjudication, be they statutes of limitations, or, in an appropriate case, filing fees," Logan v. Zimmerman Brush Co., 455 U.S. 422, 437, 102 S.Ct. 1148, 71 L.Ed.2d 265 (1982) (citation omitted), "a cost requirement, valid on its face, may offend due process because it operates to foreclose a particular party's opportunity to be heard." Boddie v. Connecticut, 401 U.S. 371, 380, 91 S.Ct. 780, 28 L.Ed.2d 113 (1971).
The United States Supreme Court has confronted, in diverse settings, the mandates of the Due Process Clause with regard to an opportunity to be heard. With respect to laws requiring payment of costs or fees to enter the courts, Boddie is a foundational case. In that case, the appellants, welfare recipients residing in Connecticut, did not have the ability to pay the court fees and costs, as required by statute, to file their lawsuit for a divorce. Id. at 372–373, 91 S.Ct. 780. As a result, the appellants sued the state challenging the requirements for payment of court fees and costs as a condition to access the court. Id. at 372, 91 S.Ct. 780.
In deciding that the fee statute was unconstitutional as applied to the appellants, the United States Supreme Court explained that due process requires, at a minimum, "that an individual be given an opportunity for a hearing before he is deprived of any significant property interest" and that a cost requirement to filing a lawsuit, "valid on its face, may offend due process because it operates to foreclose a particular party's opportunity to be heard." Id. at 379, 380, 91 S.Ct. 780. Recognizing that ensuring due process is central to the operation of a system that is designed to resolve disputes, id. at 375, 91 S.Ct. 780, the Court noted that resort to the state courts was the only avenue to dissolve a marriage and that defendants were excluded—by way of the filing fees—"from the only forum effectively empowered to settle their dispute[ ]." Id. at 376, 91 S.Ct. 780. The Court further articulated that "[r]esort to the judicial process by these plaintiffs is no more voluntary in a realistic sense than that of the defendant called upon to defend his interests in court. For both groups this process is not only the paramount dispute-settlement technique, but, in fact, the only available one." Id. at 376–377, 91 S.Ct. 780.
Two years later, in United States v. Kras, 409 U.S. 434, 435, 93 S.Ct. 631, 34 L.Ed.2d 626 (1973), the Court considered a constitutional challenge to the filing fees required for a no-asset bankruptcy proceeding.Id. In Kras, an indigent petitioner filed both a voluntary petition for bankruptcy and a motion to proceed in bankruptcy without payment of any of the filing fees. The motion, supported by an affidavit of indigency, was granted. Id. at 437–439, 93 S.Ct. 631. However, while the referee allowed the petitioner to conduct the necessary proceedings in bankruptcy, it stayed the discharge of his debts pending the outcome of his appeal in the Supreme Court. Id. at 439, 93 S.Ct. 631.
On appeal, the petitioner argued that his case was governed by Boddie because payment was required as a condition precedent to his discharge in bankruptcy. Id. at 441, 93 S.Ct. 631. The Court rejected the petitioner's argument for several reasons. First, the Court determined that there was no fundamental interest that is gained or lost depending on the availability of a discharge in bankruptcy. Id. at 445, 93 S.Ct. 631. Second, the Court noted that bankruptcy is not the sole method available to a debtor for the adjustment of his debt with his creditors, and unlike the termination of a marriage, readjustment of debts does not require access to a state's judicial machinery. Id. Lastly, the Court recognized that there was no constitutional right to obtain a discharge of one's debts in bankruptcy. Id. at 446, 93 S.Ct. 631.
That same year, in Ortwein v. Schwab, 410 U.S. 656, 93 S.Ct. 1172, 35 L.Ed.2d 572 (1973), the Court considered due process and equal protection challenges to a mandatory $25 filing fee to appeal an adverse decision from a state welfare agency. Relying on Boddie, the appellants contended that the appellate filing fee, when applied to indigents like themselves who sought to appeal an adverse welfare decision, violated the Due Process Clause of the Fourteenth Amendment. Id. at 658, 93 S.Ct. 1172. In concluding that the appellants were not denied due process, the Court relied on two factors. First, the Court explained that the appellants' claims did not implicate a fundamental constitutional right. Id. at 659, 93 S.Ct. 1172. Specifically, the Court stated that appellants' interest in increased welfare benefits "ha[d] far less constitutional significance than the interest of the Boddie appellants." Id. Second, the Court noted that each of the appellants received an agency hearing and that due process does not require a state to provide an appellate system for the redress of grievances. Id. at 659–660, 93 S.Ct. 1172. While Boddie, Kras , and Ortwein do not discuss the constitutionality of a bond requirement related to civil asset forfeiture, they nevertheless provide some insight into how our nation's highest court has addressed statutes dealing with mandatory filing fees and an opportunity to be heard. In addition, those cases set the stage for Wiren v. Eide, 542 F.2d 757 (C.A.9, 1976), a case directly on point involving a bond requirement in a civil asset forfeiture scheme.
Federal courts of appeals decisions, while not binding, may be considered for their persuasive value.Abela v. Gen. Motors Corp., 469 Mich. 603, 607, 677 N.W.2d 325 (2004).
In Wiren, the plaintiff, when returning from Canada, was stopped and searched at the United States border. Id. at 759. A body search of one of the passengers revealed a small quantity of hashish. Id. Customs agents seized the plaintiff's car on the basis that it was used to transport contraband into the United States in violation of 19 U.S.C. 1595a(a). Id. The plaintiff claimed he had no knowledge of the hashish and, because the civil asset forfeiture scheme allowed remission and mitigation proceedings, he petitioned the Secretary of Treasury for the remission or mitigation of the impending forfeiture of his car.Id. The petition was denied. Id. at 760.The plaintiff was subsequently informed of the government's intention to forfeit his vehicle. Id. The letter informed the plaintiff that his vehicle was appraised at less than $2,500. Id. The federal statutory forfeiture scheme at the time provided owners of seized property valued at more than $2,500 the opportunity for a judicial hearing, but when the property was valued at less than $2,500, a judicial hearing was afforded only if the property owner filed a claim and posted a $250 bond. Id. In the event that the required bond was not posted, the property was summarily forfeited pursuant to 19 U.S.C. 1609. Id. at 759 n. 2.
Although Michigan's civil asset forfeiture scheme does not contain provisions regarding remission or mitigation proceedings, they are not necessary to a forfeiture determination and are thus not constitutionally required. United States v. Von Neumann, 474 U.S. 242, 250, 106 S.Ct. 610, 88 L.Ed.2d 587 (1986).
The plaintiff filed a claim in accordance with 19 U.S.C. 1608, but did not post the requisite $250 bond. Id. at 760. According to the plaintiff, he was indigent and could not afford the bond. Id. Because there was no statutory procedure for the plaintiff to call his indigent condition to the attention of the Bureau of Customs and no procedure for him to halt the summary forfeiture mandated by 19 U.S.C. 1609, the plaintiff filed a cause of action and a motion to proceed in forma pauperis, which was accompanied by an affidavit of poverty. Id. The trial court granted the Bureau of Customs' motion to dismiss. Id.
Latin for "in the manner of a pauper[.]" Black's Law Dictionary (10th ed.).
On appeal, the plaintiff challenged the trial court's denial of his Fifth Amendment rights, asserting that he was denied due process. Id. at 763. The Wiren court held that the case was most similar to Boddie because the application of the bond requirement operated to deprive the appellant of a significant property interest without according him the opportunity for a hearing "of some sort." Id. at 763–764. The court held that the remission or mitigation proceeding was an inadequate substitute to a hearing because, in those proceedings, granting relief "is purely a matter of administrative grace." Id. at 764. Absent a purely voluntary remission or mitigation, a claimant's sole remedy is a court judgment that forfeiture is inappropriate. Id. Lastly, and importantly for purposes of our case, the court rejected the argument that the waiver of fee provisions for indigent persons contained in 28 U.S.C. 1915(a) afforded an indigent person a means of obtaining relief from the bond requirement because that section solely applied to court proceedings and the forfeiture statute precluded court proceedings when a claimant fails to post a bond by mandating summary administrative forfeiture. Wiren, 542 F.2d at 764. Ultimately, the court held that due process prohibits the "government from denying the opportunity for a hearing to persons whose property has been seized and is potentially subject to forfeiture solely because of their inability to post a bond." Id. at 763. Because the court determined that application of the bond requirement unconstitutionally deprived the plaintiff of the opportunity for a hearing, the court vacated the trial court's opinion and remanded the matter to the trial court to provide the plaintiff with a hearing. Id. at 764–765.
See also Fell v. Armour, 355 F.Supp. 1319, 1333–1334 (M.D.Tenn., 1972) (holding that a Tennessee forfeiture statute containing no waiver of the bond requirement for indigents challenging a seizure violated the plaintiff's right to due process of law); Brown v. District of Columbia, 115 F.Supp.3d 56, 72 (D.D.C.2015) (recognizing that "bond waivers for indigent individuals are a necessary element of a constitutionally valid forfeiture system").
Turning now to claimant's contention, we hold that Michigan's bond requirement effectively denied claimant the opportunity to be heard. Claimant is essentially put in a position similar to that of "the defendant called upon to defend his interests in court," in that her resort to the courts was not entirely voluntary, and it was the only available means to resolve her dispute. Under Michigan law, when a claimant's property is seized, the sole remedy available to a claimant is a judicial determination that the seized property was not, in fact, subject to forfeiture, which can only be sought by posting the statutorily required bond. MCL 333.7521(2) and MCL 333.7523(1)(c). And when a claimant is unable to post the bond, the seized property is administratively forfeited. MCL 333.7523(1)(d). Thus, similar to the appellants in Boddie, whose only method to obtain a divorce was resort to the courts, the only avenue available to claimant was to post the statutorily required bond and then seek to obtain a judgment declaring that her property was not subject to forfeiture. In addition, there are no "effective alternatives" for claimant to pursue to have her car returned to her. Boddie, 401 U.S. at 376, 91 S.Ct. 780. Because of her indigency and inability to pay the required bond, claimant was excluded "from the only forum effectively empowered to settle [her] dispute[ ]." Boddie, 401 U.S. at 376, 91 S.Ct. 780 ; see also Wiren, 542 F.2d at 763. Therefore, we hold that application of the bond requirement operated to deprive claimant of a significant property interest without an opportunity for a hearing. Wiren, 542 F.2d at 763.
Plaintiff suggests that claimant was given an opportunity to be heard because she potentially could have obtained a waiver of the bond requirement by filing a complaint that (1) asserted her indigency and (2) sought an injunction preventing the administrative forfeiture of her car and a waiver of the bond requirement. Plaintiff's argument is without merit for two reasons. First, the civil asset forfeiture scheme precludes claimant from filing a lawsuit for the return of seized property, MCL 333.7523(2), and in addition, a circuit court does not have jurisdiction to hear a forfeiture proceeding if the bond is not posted and the action is not commenced by the attorney general or local governmental unit. In re Return of Forfeited Goods, 452 Mich. at 667, 550 N.W.2d 782 (posting a bond, which triggers the government's obligation to initiate forfeiture proceedings, "is the only means by which the statute confers jurisdiction on the circuit court"). Second, plaintiff's procedural suggestion is not contemplated by the current statutory scheme. Wiren, 542 F.2d at 764. As stated in City of West Covina v. Perkins, 525 U.S. 234, 241, 119 S.Ct. 678, 142 L.Ed.2d 636 (1999), "[o]nce the property owner is informed that his property has been seized, he can turn to these public sources," i.e., statutes and caselaw, "to learn about the remedial procedures available to him." When turning to the public sources in Michigan, a claimant will see that the only remedial procedure available is a judicial determination that his property is not subject to forfeiture, which can only be triggered by the filing of a written claim and the posting of a bond. MCL 333.7523(1)(c) ; see In re Return of Forfeited Goods, 452 Mich. at 667, 550 N.W.2d 782. The statutory scheme does not set forth any remedial procedure with regard to obtaining a waiver of the bond requirement. We therefore reject plaintiff's argument.
We also reject plaintiff's contention that the waiver provisions of MCR 2.109(B)(1) allow an indigent claimant the opportunity to request a waiver in connection with the forfeiture proceedings. That court rule applies solely to civil court proceedings, MCR 2.001, and because under the civil asset forfeiture statute a failure to post a bond mandates that the property is forfeited after 20 days, the failure to post a bond precludes the very court proceedings in which the court rule could be applied. See Wiren, 542 F.2d at 764. In other words, because claimant could not file a bond, she could not get into court, and therefore could never seek to invoke the waiver provisions of MCR 2.109(B)(1). MCR 2.001 (court rules in Chapter 2 only apply to civil court proceedings). Simply put, the waiver provisions of MCR 2.109(B)(1) were unavailable to claimant at the time she was required to post the bond. Lastly, plaintiff rests on the fact that at the motion hearing, the prosecutor was personally aware of at least two other claimants in other cases who obtained a waiver of the bond requirement. As noted, there is no indication that the statutory scheme made such a procedure accessible to claimant. In order for claimant to take advantage of such a procedure, "if it existed at all, [claimant would have had to] depend[ ] on the vagaries of ‘word of mouth referral,’ " Memphis Light, Gas & Water Div. v. Craft, 436 U.S. 1, 14 n. 14, 98 S.Ct. 1554, 56 L.Ed.2d 30 (1978) (citation omitted), which is insufficient to satisfy due process because this is not a public source to which a claimant can turn "to learn about the remedial procedures available to him." City of West Covina, 525 U.S. at 241, 119 S.Ct. 678.
While an unpublished decision may be considered for its persuasive reasoning, Beyer v. Verizon North, Inc., 270 Mich.App. 424, 431, 715 N.W.2d 328 (2006), the decision in Any and All Monies is not persuasive as applied to this case as it fails to recognize that MCR 2.109(B)(1) may only be utilized in civil court proceedings that will never be instituted when property is administratively forfeited as a result of a claimant's inability to post the required bond. Furthermore, Any and All Monies relied on Derrick v. Detroit, 168 Mich.App. 560, 563, 425 N.W.2d 154 (1988), for the proposition that the statute is constitutional. However, Derrick did not involve an indigent claimant who was deprived of an opportunity to be heard. For this same reason, the unpublished opinion in Langston v. Charter Twp. of Redford, 623 F Appx 749 (C.A.6, 2015), provides no assistance because it relied upon the reasoning of Any and All Monies.
Because the Wiren court held that the waiver provisions of 19 U.S.C. 1915(a) were not available to the claimant, the Customs Service amended its implementing regulations to allow an indigent claimant to obtain a waiver of the bond requirement from the seizing governmental unit. Jones v. U.S. Drug Enforcement Admin., 801 F.Supp. 15, 23 (M.D.Tenn., 1992). 19 C.F.R. 162.47(e) provides, "Waiver of bond. Upon satisfactory proof of financial inability to post the bond, the Fines, Penalties, and Forfeitures Officer shall waive the bond requirement for any person who claims an interest in the seized property." Since Wiren, several courts have recognized that this type of provision is necessary to comply with the constitutional protections afforded to indigent claimants. See In re Williams, 628 F.Supp. 171, 173 (E.D.N.Y., 1986) ("In forma pauperis provisions [in a forfeiture statute] are thus constitutionally mandated for the indigent."); Tourus Records, Inc. v. Drug Enforcement Admin., 347 U.S. App DC 262, 267, 259 F.3d 731 (2001) (holding that 19 C.F.R. 162.47(e) was adopted in response to Wiren, and the waiver of the bond is an important means of affording equal access to judicial forfeiture hearings and the right to proceed as an indigent).
Ultimately, Michigan's civil asset forfeiture scheme operated to deprive this claimant of a significant property interest without according her the opportunity for a hearing, contrary to the requirements of the Due Process Clause. This holding does not render MCL 333.7523(1)(c) and (d) unconstitutional. Instead, those provisions as applied to plaintiff violated her constitutional right to due process of law.
Having determined that claimant was denied due process of law, it is unnecessary to address her equal protection argument.
B. TRIAL COURT'S FACTUAL FINDINGS
Claimant also challenges the trial court's factual findings regarding claimant's property interests in the Denali and the motorcycle. A circuit court's findings of fact are reviewed for clear error. CG Automation & Fixture, Inc. v. Autoform, Inc., 291 Mich.App. 333, 337, 804 N.W.2d 781 (2011). "Clear error exists when the reviewing court is left with a definite and firm conviction that a mistake has been made." Massey v. Mandell, 462 Mich. 375, 379, 614 N.W.2d 70 (2000).In order to forfeit the property, the trial court was required to find by clear and convincing evidence that the Denali and the motorcycle were "used or intended for use, to transport, or in any manner to facilitate the transportation [of a controlled substance], for the purpose of sale or receipt...." MCL 333.7521(1)(d) and (2). In addition, the trial court was required to "find that there [wa]s a substantial connection between that asset and the underlying criminal activity." In re Forfeiture of $1,159,420, 194 Mich.App. 134, 146, 486 N.W.2d 326 (1992). "[P]roperty that has only an incidental or fortuitous connection to the unlawful activity is not subject to forfeiture." Id. The power to forfeit property is also limited by MCL 333.7521(1)(d)(ii ), which establishes the "innocent owner" defense as follows: "A conveyance is not subject to forfeiture by reason of any act or omission established by the owner of that conveyance to have been committed or omitted without the owner's knowledge or consent." Innocent ownership is an affirmative defense, so the burden is on the claimant to produce evidence that he neither had knowledge of nor consented to the illegal activity forming the basis for forfeiture. See in re
MCL 333.7521(f) also provides in pertinent part, "To the extent of the interest of an owner, a thing of value is not subject to forfeiture under this subdivision by reason of any act or omission that is established by the owner of the item to have been committed or omitted without the owner's knowledge or consent."
forfeiture of $53, 178 micH.app. 480, 496, 444 N.W.2d 182 (1989) ; In re Forfeiture of a Quantity of Marijuana, 291 Mich.App. 243, 250, 805 N.W.2d 217 (2011). In the context of the forfeiture statute, our Court has interpreted the word "knowledge" to "not include the concept of constructive knowledge." Id. at 252, 805 N.W.2d 217. However, a claimant's consent may be implied from the circumstances even without knowledge. Id. at 253, 805 N.W.2d 217.Here, the trial court found that the Denali and the motorcycle were subject to forfeiture, and this finding was not clearly erroneous. Officer Stafford's testimony established more than a substantial connection between the underlying activity and the Denali and the motorcycle. Officer Stafford testified that he was familiar with Quinton's role as a drug dealer in the area and that he had seen Quinton in the area in a Denali and on a motorcycle while dealing drugs. Therefore, the trial court's factual finding that the Denali and the motorcycle were subject to forfeiture was not clearly erroneous as there was a substantial connection between the underlying criminal activity and the property.
Claimant also contends that the trial court erred when it found that claimant was not an innocent owner. Specifically, claimant argues that the trial court erred when it failed to find that claimant was the owner of the Denali and the motorcycle. Our Court has previously defined the term "owner" with regard to the innocent-owner defense as: "The person in whom is vested the ownership, dominion, or title of property; ... He who has dominion of a thing, real or personal, corporeal or incorporeal, which he has a right to enjoy and do with as he pleases." In re Forfeiture of $53, 178 Mich.App. at 493, 444 N.W.2d 182 (quotation marks and citation omitted).
The trial court clearly erred in finding that claimant did not have an ownership interest in the Denali and the motorcycle. Evidence was presented that title to the vehicles was in claimant's name. Although claimant signed the title of the Denali and the motorcycle with the intent of transferring them to Quinton, Quinton was required to sign the title in order to complete the transfer of title. See MCL 257.233(9) ("[T]he effective date of the transfer of title or interest in the vehicle is the date of signature on either the application for title or the assignment of the certificate of title by the purchaser, transferee, or assignee."); see also Perry v. Golling Chrysler Plymouth Jeep, Inc., 477 Mich. 62, 66–67, 729 N.W.2d 500 (2007) (holding that transfer of a vehicle's ownership is complete at signing). The record is devoid of any evidence that Quinton signed the title. Thus, the evidence did not support that the transfer of ownership of the vehicles was complete and, as a result, claimant retained legal title, making her the owner of both vehicles. In re Forfeiture of $53, 178 Mich.App. at 493, 444 N.W.2d 182. Accordingly, the trial court's finding that claimant was not the owner of the vehicles was clearly erroneous.
Although the trial court clearly erred in finding that claimant had no property interest in the Denali and the motorcycle, the trial court nonetheless found that claimant had actual knowledge of Quinton's criminal activity. This finding is not clearly erroneous and defeats her claim that she was an innocent owner. As in People v. One 1979 Honda Auto., 139 Mich.App. 651, 654, 362 N.W.2d 860 (1984), the innocent-owner defense pertinent to this case is set forth in MCL 333.7521(1)(d)(ii ), which provides: "A conveyance is not subject to forfeiture by reason of any act or omission established by the owner of that conveyance to have been committed or omitted without the owner's knowledge or consent." Evidence was presented that claimant admitted to officers that she knew marijuana plants were being grown in the basement of her house, and that she had seen defendant in the kitchen mixing cocaine and baking soda (to make crack cocaine). Claimant also admitted that she knew Quinton was "hanging out in the streets." In addition, when Quinton called claimant from jail, claimant, without being prompted, asked Quinton if he had the whole bag of pills, indicating that she had knowledge of the pills. On that same call, Quinton requested that claimant "check the corn in the cabinet," and claimant agreed that she would. While claimant testified that she did not have knowledge of the underlying drug activity, the burden was on claimant to prove that she neither had knowledge of nor consented to the illegal activity. In re Forfeiture of $53, 178 Mich.App. at 496, 444 N.W.2d 182 ; In re Forfeiture of a Quantity of Marijuana, 291 Mich.App. at 250, 805 N.W.2d 217. The trial court, as the assessor of credibility, apparently did not believe claimant's testimony. Therefore, the trial court's finding that claimant had actual knowledge of the underlying criminal activity was not clearly erroneous and defeats her argument on appeal that she was an innocent owner.
Testimony was presented that the term "corn" refers to crack cocaine when it is mixed with marijuana.
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Affirmed in part, reversed in part, and remanded for further proceedings. We do not retain jurisdiction. No costs, neither party having prevailed in full. MCR 7.219(A).
SAWYER and METER, JJ., concurred with MURRAY, P.J.