U.S. v. $129,374 in U.S. Currency

• Decision Date: 21 August 1985
• Docket Number: No. 84-6419,84-6419
• Citation: 769 F.2d 583
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. $129,374 IN UNITED STATES CURRENCY, Defendant, and All Related Actions, Gerald M. Geiger, as conservator of the estate of Lewis Michael Geiger, Applicant for Intervention-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 583

769 F.2d 583

3 Fed.R.Serv.3d 978

UNITED STATES of America, Plaintiff-Appellee, v. $129,374 IN UNITED STATES CURRENCY, Defendant, and All Related Actions, Gerald M. Geiger, as conservator of the estate of Lewis

Michael Geiger, Applicant for Intervention-Appellant.

No. 84-6419.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted June 4, 1985.

Decided Aug. 21, 1985.

Robert Plaxico, Asst. U.S. Atty., San Diego, Cal., for plaintiff-appellee.

Howard Finkelstein, Jenkins & Perry, San Diego, Cal., for applicant for intervention-appellant.

Appeal from the United States District Court for the Southern District of California.

Before WALLACE, TANG and WIGGINS, Circuit Judges.

WALLACE, Circuit Judge:

Gerald Geiger (Gerald) appeals from the district court's denial of his motion to intervene in a forfeiture proceeding under 21 U.S.C. Sec. 881(a)(6) concerning property belonging to his fugitive brother, Lewis Geiger (Lewis). We have jurisdiction under 28 U.S.C. Sec. 1291, and we affirm.

I

This matter stems from a search pursuant to a warrant of Lewis' home that was conducted on April 22, 1983. The search produced significant quantities of cocaine. The officers also seized United States currency, gold and silver coins and ingots, and three vehicles on the ground that they were believed to be the proceeds of unlawful narcotics transactions, and thus forfeitable under 21 U.S.C. Sec. 881(a)(6). Lewis was arrested later that day, along with two others who lived with him.

Lewis was released on bail upon the posting of a $150,000 personal surety bond. Gerald and Elaine Geiger, Lewis' brother and sister-in-law, signed as cosureties and secured the bond with their home. After the district court rejected Lewis' challenge to the validity of the search warrant, he waived his right to a jury trial and submitted the criminal case for decision on stipulated facts. He was found guilty on three counts of conspiracy to possess cocaine with intent to distribute in violation of 21 U.S.C. Secs. 841(a)(1) and 846, possession of cocaine with intent to distribute in violation of 21 U.S.C. Sec. 841(a)(1), and possession of an unregistered machine gun in violation of 26 U.S.C. Secs. 5861(d), 5871.

In June and July of 1983, while the criminal charges against Lewis were still pending, the government initiated the present forfeiture proceedings under 21 U.S.C. Sec. 881(a)(6) against various items seized from Lewis' residence and his person. Six separate complaints were filed and subsequently consolidated. The items involved here include fifty 100-ounce silver bars, seventy-two 1-ounce gold pieces, seven 10-ounce silver pieces, U.S. currency ($129,374 and $1,013), a 1947 Ford Woodie Wagon, and a 1982 Jeep Wagoneer.

Lewis and his codefendant girlfriend filed claims contesting the forfeiture of the silver, the gold, and the $129,374 in currency. Lewis separately contested the forfeiture of the two vehicles, and the $1,013 in currency. His lawyers filed claims contesting the forfeiture of all of these items on the basis of Lewis' purported assignment of the property subsequent to his arrest.

Lewis' sentencing was scheduled for December 5, 1983. He failed to appear and the sentencing hearing was continued until the following day. He again failed to appear. The court then issued a warrant and declared his personal surety bond forfeited. On December 30, 1983, the government filed a motion for judgment on default on the forfeited bond.

Before the hearing on that motion, Gerald filed a petition in state court to declare himself conservator of Lewis' estate. The state court approved Gerald's conservatorship on April 13, 1984.

Gerald, in his capacity as conservator of Lewis' estate and in his personal capacity as cosurety of Lewis' bond, moved on May 4, 1984 to set aside the forfeiture of the bail bond. Acknowledging the absence of any evidence that Lewis was dead, Gerald did not contest the entry of judgment against Lewis' estate but asked that judgment not be entered against himself and his wife--the innocent cosureties.

After numerous continuances, a hearing was held on the government's motion for judgment of default on the bond and the motion to set aside forfeiture. After noting Lewis' past criminal record, the substantial sentence recommended by the probation department of which Lewis was aware, and the circumstances of Lewis' disappearance, the district court found against Lewis' estate and against Gerald and Elaine Geiger. Judgment in the bail bond forfeiture was entered on August 2, 1984.

On May 4, 1984, the government moved for summary judgment in the consolidated forfeiture proceedings. The government argued in part that because Lewis was a fugitive from justice, he had disentitled himself to contest the forfeiture.

Gerald moved to intervene as conservator of Lewis' estate both as of right and permissively under Fed.R.Civ.P. 24(a)(2), (b)(2). Gerald also filed an opposition to the government's summary judgment motion. No other opposition to the government's summary judgment motion was filed. Although the government initially stipulated to intervention by Gerald, it subsequently urged the district court to deny the conservator's motion to intervene on the ground that he lacked standing to contest the forfeiture because he stood in the shoes of the fugitive defendant.

The district court denied the motion to intervene. Relying principally on Molinaro v. New Jersey, 396 U.S. 365, 90 S.Ct. 498, 24 L.Ed.2d 586 (1970) (per curiam) (Molinaro ), and Conforte v. Commissioner, 692 F.2d 587 (9th Cir.1982) (Conforte ), the court held that Lewis had disentitled himself from contesting the forfeiture and thus the conservator who merely stood in Lewis' shoes lacked standing to intervene. Accordingly, the district judge ordered stricken from the record the conservator's brief in opposition to the government's summary judgment motion. The order denying intervention was entered on August 22, 1984.

On August 20, 1984, the district court held a hearing on the government's motion for summary judgment, and found that the government had met its burden of demonstrating probable cause for the forfeiture under 21 U.S.C. Sec. 881(a)(6). No evidence was introduced to refute the government's showing of probable cause. As a result, the district court granted the government's motion for summary judgment, and entered its order on October 15, 1984.

On October 22, 1984, Gerald, as conservator of Lewis' estate, timely filed a notice of appeal seeking review of both the district court's denial of his motion for intervention and the summary judgment in favor of the government.

II

Generally, a party is entitled to intervention as of right if he satisfies the four-part test set forth in rule 24(a)(2), Fed.R.Civ.P.:

(1) the applicant's motion must be timely; (2) the applicant must assert an interest relating to the property or transaction which is the subject of the action; (3) the applicant must be so situated that without intervention the disposition of the action may, as a practical matter, impair or impede his ability to protect that interest; and (4) the applicant's interest must be inadequately represented by the other parties.

Smith v. Pangilinan, 651 F.2d 1320, 1323-24 (9th Cir.1981) (Smith). Rule 24(b)(2), Fed.R.Civ.P., provides for permissive joinder "when an applicant's claim or defense and the main action have a question of law or fact in common." We review a district court's order denying intervention as of right de novo, see, e.g., Smith, 651 F.2d at 1324-25, except for the issue of timeliness, which is reviewed for abuse of discretion. United States v. Oregon, 745 F.2d 550, 552 (9th Cir.1984). In contrast, permissive intervention is committed to the broad discretion of the district court. See Smith, 651 F.2d at 1325; Blake v. Pallan, 554 F.2d 947, 951 n. 5 (9th Cir.1977).

A.

The district court denied the conservator's motion to intervene, agreeing with the government that he lacked standing to contest the forfeiture. The court reasoned that under the rationale of Molinaro, 396 U.S. at 366, 90 S.Ct. at 498, and Conforte, 692 F.2d at 590, Lewis and the conservator, who stood in Lewis' shoes, were disentitled from contesting the government's civil forfeiture claim.

The conservator essentially argues that the district court erroneously confused the concepts of standing and rule 24's requirements for intervention. He asserts that he demonstrated a sufficient interest in the property involved in the forfeiture proceeding to satisfy any standing requirements of rule 24, and therefore he should have been allowed to intervene as of right. He contends that the district court's discussion of the Molinaro/Conforte disentitlement doctrine was premature. That issue, he continues, should have been reserved until the hearing on the government's motion for summary judgment, at which time the conservator could have presented evidence bearing upon the issue of whether Lewis was in fact a fugitive.

To the extent that the district court's order is based upon a theory of standing, we agree with the conservator. We admit that this is not an issue on which we have given clear guidance. We have held that a motion to intervene may be denied when an applicant fails to demonstrate standing to pursue his claim, e.g., DuPree v. United States, 559 F.2d 1151 (9th Cir.1977). Nevertheless, the principal focus of a motion to intervene under rule 24 is whether an applicant has "show[n] that he has a 'protectable interest' in the outcome of the litigation of sufficient magnitude to warrant inclusion in the action." Smith, 651 F.2d at 1324. Lewis certainly has an interest in defending an action to forfeit his property. The conservator of his estate, who stands in his shoes under state law, necessarily has the same protectable interest in the property subject to forfeiture. We conclude that it would be inappropriate to affirm the district court on the ground...