Forfeiture of $1,159,420, In re

• Citation: 194 Mich.App. 134,486 N.W.2d 326
• Parties: In re FORFEITURE OF $1,159,420. Docket 133003.
• Decision Date: 04 May 1992
• Court: Court of Appeal of Michigan (US)

Page 326

486 N.W.2d 326

194 Mich.App. 134

In re FORFEITURE OF $1,159,420.

Docket 133003.

Court of Appeals of Michigan.

Submitted Oct. 15, 1991, at Detroit.

Decided May 4, 1992, at 9:45 a.m.

Released for Publication Aug. 3, 1992.

Frank J. Kelley, Atty. Gen., Gay Secor Hardy, Sol. Gen., John D. O'Hair, Pros. Atty., Andrea Solak, Chief of Special Operations, Charles H. Marr, Director, Forfeiture Unit, and Mary Sue Czarnecki, Asst. Pros. Atty., for the People.

James W. Burdick, P.C. by James W. Burdick, Bloomfield Hills, for claimants.

Stuart L. Stein, Santa Fe, N.M., for claimant Robert Hawkins.

Before GRIFFIN, P.J., and DOCTOROFF and BRENNAN, JJ.

BRENNAN, Judge.

Claimants appeal as of right from an August 2, 1990, judgment of forfeiture of property seized under a controlled substances provision of the Public Health Code, M.C.L. Sec. 333.7521; M.S.A. Sec. 14.15(7521), entered by Wayne Circuit Court Judge Michael J. Talbot. We affirm in part and reverse in part.

The record reveals that, in 1988, claimant Robert Hawkins pleaded guilty in Detroit Recorder's Court of attempted possession of less than twenty-five grams of cocaine, M.C.L. Sec. 333.7403(2)(a)(v); M.S.A. Sec. 14.15(7403)(2)(a)(v); M.C.L. Sec. 750.92; M.S.A. Sec. 28.287. The case was adjudicated under M.C.L. Sec. 333.7411; M.S.A. Sec. 14.15(7411) and he was placed on probation. On the basis of the assets Hawkins disclosed in his probation report, the Wayne County prosecutor's office became suspicious that he was living well beyond his legitimate income as a retired Chrysler factory worker. The forfeiture unit of the Wayne County Prosecutor's office supplied this information to the Oakland County Narcotics Enforcement Team (NET), which began investigating Hawkins. This investigation ceased after surveillance by NET as well as the State Police revealed nothing unusual except for heavy traffic in and out of the claimants' house and the presence of many expensive automobiles.

Subsequently, the State Police referred an informant named Randy Ulmer to West Bloomfield Police Officer Jerome Sharpe. Ulmer indicated that he had seen a large amount of cocaine in the basement of claimants' house. On the basis of this information, NET and Sharpe executed a search warrant for claimants' West Bloomfield home on May 9, 1989. The search revealed, among other items, weapons, a suspected drug ledger, and a great amount of cash, some of which had a residue of cocaine. A specially trained canine unit also indicated that traces of cocaine were present in areas throughout the house and in one car belonging to the claimants. This search resulted in the present forfeiture proceedings, which were instituted on May 10, 1989. ¹

Before trial, the parties reached a comprehensive stipulation regarding the tracing of assets in this case. Robert Hawkins stated that he had worked for Chrysler Corporation for sixteen years. He further stated that he had owned rental properties in Detroit since he was nineteen years old, as well as a beer and wine store from 1978 to 1986. Hawkins explained that his income resulted from these sources plus some gambling profits and loans that he made. In addition, claimants alleged that they had received $2 million as the result of a personal injury lawsuit in the Macomb Circuit Court. The lawsuit allegedly stemmed from a 1983 incident when Margaret Wilson, an insurance agent from Chicago, became upset after Pamela Hawkins told her she was not interested in the insurance Wilson was selling. Wilson allegedly hit Pamela, who then fell over a banister and down some stairs. Claimants stated that Pamela was pregnant at the time and later had an abortion because she thought her doctor, Dr. Lall, told her that something may have been wrong with the fetus as a result of the fall. The Hawkinses filed a lawsuit against Wilson in the Macomb Circuit Court on October 11, 1985, and were represented in that suit by attorney Alvin Brazzell. They later settled the suit with Wilson for $2 million a substantial amount of which was delivered in cash. ² Brazzell abruptly left his practice in February 1987 and, for reasons unknown to this Court, was incarcerated in a federal prison at the time of trial.

The trial court found claimants' lawsuit against Wilson to be nothing more than a money-laundering scheme. Judge Talbot ultimately ordered forfeiture of the West Bloomfield home, the cash found therein, jewelry, weapons, cars, a computer and printer, a boat, property located in Florida, and several different bank accounts, annuities, and life insurance policies. Most of the property forfeited was located in Oakland County. Claimants raise a number of issues on appeal.

ISSUE I

Claimants first argue that the court erred in ordering forfeiture of all the assets except for the Lincoln, the Tiffany, and the Bayliner boat because those are the only items covered by a seizure order or arrest warrant. Claimants contend that the trial court had no jurisdiction over nonseized assets and, therefore, those assets should have been returned to claimants. However, pursuant to M.C.L. Sec. 333.7522(a); M.S.A. Sec. 14.15(7522)(a), seizure without process may be made where it is incident to an arrest or a search warrant. Here, the previously issued search warrant included many of the items referred to by claimants. Therefore, those items did not need to be listed again on a seizure order. The property not included in the search warrant was subsequently seized with process by seizure orders and orders freezing assets. Consequently, the circuit court had jurisdiction to proceed with this case under Sec. 7522.

Claimants assert that the trial court erred in ordering forfeiture of an annuity policy despite the fact that it was never named as a defendant in any filed complaint nor made the subject matter of a seizure warrant or order freezing assets. Contrary to claimants' argument, a June 1, 1989, order freezing assets included two annuities. In addition, on the basis of the order freezing assets, settlement negotiations, and its seizure during the execution of the search warrant, it is clear that claimants had notice before trial that the asset was subject to forfeiture. Notice regarding the court's alleged lack of jurisdiction with regard to the annuities should have been raised before trial. By leaving the matter to the time of trial, claimants waived jurisdiction of the policies to the court.

Claimants argue that the trial court lacked jurisdiction over property located in Florida. We agree. Michigan courts have jurisdiction only over land situated within its territorial borders. M.C.L. Sec. 600.751; M.S.A. Sec. 27A.751; Stewart v. Eaton, 287 Mich. 466, 283 N.W. 651 (1939). Any complaint to forfeit claimants' realty located in Florida should be filed with the Florida courts that have jurisdiction over that property.

ISSUE II

Claimants argue that the trial court erred in denying their motion to change venue to Oakland County because all the realty and personal property forfeited was located either in Oakland County or outside the State of Michigan. However, assuming the trial court did err in denying the motion, reversal is not warranted. Michigan's venue provisions are nonjurisdictional. M.C.L. Sec. 600.1601; M.S.A. Sec. 27A.1601.

ISSUE III

Claimants argue that the court erred in its rulings with regard to several discovery matters. Claimants first argue that the trial court erred in denying basic discovery. For example, they state that the trial court erred in not requiring the people to answer an interrogatory requesting that the people set forth their various theories under which each item was claimed to be forfeitable. However, the people did respond, indicating that forfeiture was sought on theories that referred to the items as controlled substances proceeds, facilitators, or containers under M.C.L. Sec. 333.7521; M.S.A. Sec. 14.15(7521). The trial court properly found that the prosecutor could argue alternative theories. MCR 2.111(A)(2). In addition, claimants state that the court erred in not requiring the prosecutor to produce all documents concerning any criteria used by the prosecutor in bringing, prosecuting, or settling cases under the forfeiture act. We agree with the trial court that this information was not relevant. Accordingly, we find no abuse of discretion. Eyde v. Eyde, 172 Mich.App. 49, 54, 431 N.W.2d 459 (1988). Moreover, we fail to see how claimants were prejudiced. MCR 2.613(A).

Claimants next argue that the trial court erred in issuing for the people "secret" subpoenas with no notice to the claimants. Claimants refer to subpoenas that stated that "due to a continuing criminal investigation, notice of this Subpoena is not to be given to any named party." One subpoena was issued to Pamela Hawkins' doctor, Dr. Chitranjan Lall. Claimants argued that, as a result of this unfair tactic, they were foreclosed from asserting the doctor-patient privilege. Similar subpoenas were issued to First Federal of Michigan and Shearson, Lehman, Hutton without notice to claimants. Claimants contend that they were prejudiced in preparing for this case because they never received notice of these subpoenas.

Claimants were entitled to notice of service of any discovery requests on witnesses. MCR 2.107(A); MCR 2.305(A)(1); MCR 2.306(B)(1). Such notice is necessary to any party before discovery may be had in order for the opposing party to assert any objection or move for a protective order to prohibit the production of any materials otherwise not subject to discovery. The conduct complained of was reprehensible. Nevertheless, we find that the action was not taken wilfully to prejudice claimants, but was taken for reasons involving the ongoing criminal investigation involving claimants. Further, Dr. Lall's testimony was kept out of evidence at trial after claimants asserted the doctor-patient privilege. Therefore, no prejudice resulted in that regard. MCR 2.613(A). Fur...