City of Grand Rapids v. $2,124 (In re $2,124)
| Decision Date | 11 August 2022 |
| Docket Number | 357843 |
| Parties | In re FORFEITURE OF $2,124. v. $2,124, IPHONE, and 2016 DODGE, Defendants, CITY OF GRAND RAPIDS, Plaintiff-Appellee, and LIDYA GEBRENGUS, Claimant-Appellant. |
| Court | Court of Appeal of Michigan — District of US |
Kent Circuit Court LC No. 21-001243-CF
Before: Swartzle, P.J., and Ronayne Krause and Garrett, JJ.
Claimant Lidya Gebrengus, appeals as of right the trial court's order dismissing plaintiff's complaint for forfeiture of $2,124 in cash, an iPhone, and a vehicle that were seized from Gebrengus, insofar as that order denied her request for costs and attorney fees. The trial court ordered plaintiff to return Gebrengus's property, but determined that plaintiff's complaint was not frivolous. Because the complaint for forfeiture was devoid of arguable legal merit with regard to Gebrengus's vehicle, we remand this case to the trial court with instructions to issue an appropriate award of costs and attorney fees incurred by Gebrengus.
On December 2, 2020, the police arrested Gebrengus's boyfriend and others, after a search of their vehicle uncovered multiple handguns and large quantities of controlled substances. Location data from the boyfriend's cell phone indicated that the phone had been at Gebrengus's home in the hours before his arrest, and a car key found on the boyfriend's person matched an Audi vehicle located at the Gebrengus's home. During an inventory search of the Audi, the police found cocaine and a digital scale. The police obtained a search warrant for Gebrengus's address and executed the warrant on December 4, 2020. The police found Gebrengus in her car, a 2016 Dodge, and found 0.2 grams of cocaine and a digital scale with cocaine residue inside the vehicle. The police seized the Dodge, seized Gebrengus's iPhone from her person, and seized $2,124 in cash, ammunition, and two more digital scales from inside her residence. Gebrengus told the police that her boyfriend sometimes used her car and stayed at her residence, and that the money, cocaine, and scales were her boyfriend's items.
Gebrengus was originally charged with possession of less than 25 grams of cocaine, MCL 333.7403(2)(a)(v). On December 28, 2020, she pleaded to a reduced charge of using cocaine, MCL 333.7404, and was sentenced to probation under MCL 333.7411, which discharges the defendant without an adjudication of guilt if the defendant complies with the terms of probation.
On February 9, 2021, plaintiff filed a complaint for forfeiture of the cash, phone, and vehicle seized from Gebrengus, in accordance with MCL 333.7521, asserting in part that the seized property was subject to forfeiture as property used to facilitate violations of the laws regulating controlled substances. Gebrengus moved for summary disposition in April 2021, arguing that the forfeiture statute barred plaintiff from seeking forfeiture of her vehicle, and asked for costs and attorney fees incurred in defending a frivolous complaint.
On June 23, 2021, Gebrengus successfully completed the conditions of her probation, and her plea under MCL 333.7411 was set aside. Plaintiff did not oppose Gebrengus's motion for summary disposition upon her successful discharge from probation, but plaintiff did object to her request for costs and attorney fees. At a hearing on Gebrengus's motion, the trial court granted summary disposition but denied the request for costs and attorney fees. The trial court reasoned that the forfeiture claim was not frivolous because Gebrengus's admissions indicated that she knew that another person had used the seized items for the possession or sale of controlled substances. The court dismissed plaintiffs complaint for forfeiture with prejudice and ordered plaintiff to return all of Gebrengus's seized property. Gebrengus appeals from this order, arguing that the court erred by failing to acknowledge on the record that she was not convicted of a crime, and by concluding that the forfeiture complaint was not frivolous.
"A trial court's decision in a forfeiture proceeding will not be overturned unless it is clearly erroneous." In re Forfeiture of $180,975, 478 Mich. 444, 450; 734 N.W.2d 489 (2007). Clear error exists where, although there is evidence to support the trial court's finding, the reviewing court is left with a definite and firm conviction that a mistake has been made. Id. Further, we review a trial court's decision regarding an award of costs and attorney fees for an abuse of discretion. Reed v Reed, 265 Mich.App. 131, 164; 693 N.W.2d 825 (2005). An abuse of discretion occurs when the trial court's decision falls "outside the range of principled outcomes." Edry v Adelman, 486 Mich. 634, 639; 786 N.W.2d 567 (2010). We review a trial court's ruling on the frivolity of a claim for clear error. In re Attorney Fees and Costs, 233 Mich.App. 694, 701; 593 N.W.2d 589 (1999).
Forfeiture proceedings are in rem civil proceedings, In re Forfeiture of $25,505, 220 Mich.App. 572, 574; 560 N.W.2d 341 (1996), which "must be instituted promptly" after the property at issue is seized, MCL 333.7523(1). The government bears the burden of proving its claim for forfeiture by clear and convincing evidence. MCL 333.7521(2).
Here, the complaint for forfeiture stated that Gebrengus's property was seized in accordance with MCL 333.7522(c) and (d), which provide:
MCL 333.7521 identifies property subject to forfeiture, including" '[a]ny thing of value that is furnished or intended to be furnished in exchange for a controlled substance, . . . that is traceable to an exchange for a controlled substance, . . . or that is used or intended to be used to facilitate any violation of [the controlled substances act].'" In re Forfeiture of $25,505, 220 Mich.App. at 574 (), quoting MCL 333.7521(1)(f). This statute requires a "substantial connection between the property and the criminal activity." In re Forfeiture of 301 Cass Street, 194 Mich.App. 381, 384; 487 N.W.2d 795 (1992).
Further, MCL 333.7521a(1) states that seized property is not subject to forfeiture under MCL 333.7521 "unless a criminal proceeding involving or relating to the property has been completed and the defendant pleads guilty to or is convicted of a violation of this article."[1] In this case, Gebrengus pleaded to a charge of using narcotics, MCL 333.7404, and was adjudicated under MCL 333.7411.[2] This Court, in People v Benjamin, 283 Mich.App. 526, 530; 769 N.W.2d 748 (2009), explained how MCL 333.7411 operates:
In deferral proceedings under MCL 333.7411(1), an individual either pleads guilty or is found guilty of certain controlled substance offenses. The trial court does not adjudicate guilt when the plea is tendered. Instead, the trial court defers proceedings and places the individual on probation. If the individual complies with the terms of probation, the trial court discharges the individual without an adjudication of guilt and dismisses the proceedings. If the individual fails to fulfill the terms of probation, the trial court enters an adjudication of guilt.
In effect, this statute renders the tendered plea "a nullity if the defendant does successfully take advantage of the second chance." Carr v Midland Co Concealed Weapons Licensing Bd, 259 Mich.App. 428, 435; 674 N.W.2d 709 (2003).
Gebrengus initially argues that the trial court erred by granting her motion for summary disposition without finding that she was not convicted of a crime. The trial court acknowledged that Gebrengus had been on probation under MCL 333.7411, and that the complaint for forfeiture was filed in case she did not successfully complete probation and thus was convicted of using narcotics. Plaintiff did not oppose summary disposition because it accurately recognized that there was a "statutory bar" to forfeiture that applied "when defendant successfully completes all terms of probation and is successfully discharged pursuant to [MCL 333.7411]." The trial court dismissed plaintiffs complaint for forfeiture of Gebrengus's property, and explained that it "grant[ed] your motion because the People don't oppose it." Contrary to Gebrengus's argument, however, the trial court also stated at the motion hearing that Gebrengus "wasn't, in fact, convicted." Accordingly, this argument lacks merit.[3]
Gebrengus next argues that the trial court erred by denying her motion for costs and attorney fees incurred in contesting plaintiffs complaint for the forfeiture of her vehicle because the complaint was frivolous.
MCL 600.2591(1) entitles a party to recover costs and attorney fees for a frivolous action:
Upon motion of any party, if a court finds that a civil action or defense to a civil action was frivolous, the court that conducts the civil action shall award to the prevailing party the costs and fees incurred by that party in connection with the civil action by assessing the costs and fees against the nonprevailing party and their attorney.
MCL 600.2591(3)(a) in turn provides as follows:
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