People v. Barnes

• Decision Date: 22 January 1986
• Docket Number: Docket No. 76275
• Citation: 146 Mich.App. 37,379 N.W.2d 464
• Court: Court of Appeal of Michigan — District of US
• Parties: PEOPLE of the State of Michigan, Plaintiff-Appellee, v. Daniel BARNES, Jr., Defendant-Appellant. 146 Mich.App. 37, 379 N.W.2d 464

Page 464

379 N.W.2d 464

PEOPLE of the State of Michigan, Plaintiff-Appellee, v. Daniel BARNES, Jr., Defendant-Appellant.

Docket No. 76275.

146 Mich.App. 37, 379 N.W.2d 464

Court of Appeals of Michigan.

Submitted Feb. 20, 1985.

Decided Oct. 7, 1985.

Released for Publication Jan. 22, 1986.

[146 MICHAPP 38] Frank J. Kelley, Atty. Gen., Louis J. Caruso, Sol. Gen., John D. O'Hair, Pros. Atty., Edward Reilly Wilson, Deputy Chief, Civil and Appeals, and Timothy A. Baughman,[146 MICHAPP 39] Principal Atty., Research, Training and Appeals, for the People.

Joseph Freed, Detroit, for defendant-appellant.

Before WAHLS, P.J., and SHEPHERD and QUINNELL ^*, JJ.

QUINNELL, Judge.

Defendant was charged with three counts of receiving and concealing stolen property with a value of more than $100, M.C.L. Sec. 750.535; M.S.A. Sec. 28.803. Prior to trial he moved to suppress the evidence, alleging that it had been obtained by means of an unconstitutional search and seizure. His pretrial motion was denied. At trial, he was found not guilty of the first two counts, but guilty as charged as to count III of the information. He appeals as of right.

Defendant operated an automobile salvage yard. Persons engaged in that business are required to obtain one or more licenses, M.C.L. Sec. 257.248; M.S.A. Sec. 9.1948, and are further required to maintain certain records pertaining to their transactions and inventory, M.C.L. Sec. 257.251; M.S.A. Sec. 9.1951. Defendant did neither. On March 17, 1983, two officers assigned to the commercial auto theft section of the Detroit Police Department went to defendant's place of business to check on a vehicle believed to be involved in an insurance fraud scheme. Although that vehicle checked out satisfactorily, the officers, while there, decided to do a spot check of defendant's yard. The officers found that parts from a 1978 Cadillac, a 1978 Buick, and a 1977 Chrysler came from stolen vehicles. According to one of the officers, the Cadillac parts (count III of the information) had been concealed in a heap, and looked fairly new, but the parts from the [146 MICHAPP 40] other two vehicles (counts I and II of the information) were just lying out in the open. The officers then asked defendant to produce the statutorily required records pertaining to those parts, and defendant was unable to do so. The officers then seized the parts, and prosecution followed. The officers did not have a search warrant during any of these events.

I

Notwithstanding the absence of a warrant, the prosecution contends that the search and seizure was proper under M.C.L. Sec. 257.251(e); M.S.A. Sec. 9.1951(e). ¹ The statute provides as follows:

"Each dealer record and inventory, including the record and inventory of a vehicle scrap metal processor not required to obtain a dealer license, shall be open to inspection by a police officer or authorized officer or investigator of the secretary of state during reasonable or established business hours."

Defendant maintains that the search without a warrant contravenes the provisions of U.S. Const., Am. IV as well as the parallel Michigan provision found in Const.1963, art. 1, Sec. 11.

After the briefs in this case were filed, the Michigan Supreme Court decided Tallman v. Dep't. of Natural Resources, 421 Mich. 585, 365 N.W.2d 724 (1984). Tallman controls our analysis.

A search without a warrant is unreasonable per se and violates both the Michigan Constitution and the United States Constitution unless the search is shown to be within an exception to the general [146 MICHAPP 41] rule. The United States Supreme Court has adopted an exception which has come to be known as the "pervasively regulated industry" doctrine, or the Colonnade-Biswell doctrine. Colonnade Catering Corp. v. United States, 397 U.S. 72, 90 S.Ct. 774, 25 L.Ed.2d 60 (1970); United States v. Biswell, 406 U.S. 311, 92 S.Ct. 1593, 32 L.Ed.2d 87 (1972). The doctrine holds that searches without warrants are not unreasonable per se in pervasively regulated industries as long as certain conditions are met. Other states have also adopted the doctrine, Tallman, supra, 421 Mich. p. 613, 365 N.W.2d 724. In Tallman, supra, pp. 616-617, 365 N.W.2d 724, the Michigan Supreme Court adopted the "pervasively regulated industry" doctrine as the law of this state. The Court described the application of the doctrine as follows:

"We conclude that conflicts arising under art. 1, Sec. 11 of the Michigan Constitution between the enforcement needs of governmental agencies and the privacy interests of regulated commercial actors should be resolved by balancing the following factors:

"(1) the existence of express statutory authorization for search or seizure;

"(2) the importance of the governmental interest at stake;

"(3) the pervasiveness and longevity of industry regulation;

"(4) the inclusion of reasonable limitations on searches in statutes and regulations;

"(5) the government's need for flexibility in the time, scope and frequency of inspections in order to achieve reasonable levels of compliance;

"(6) the degree of intrusion occasioned by a particular regulatory search; and

"(7) the degree to which a business person may be said to have impliedly consented to warrantless searches as a condition of doing business, so that the search does not infringe upon reasonable expectations of privacy." (Footnotes omitted.)

[146 MICHAPP 42] The Court further noted that the seven Michigan factors differ only slightly from the factors commonly applied in the federal courts. Federal precedent is therefore useful.

We conclude that all seven factors weigh in favor of the validity of this search.

(1). The statute quoted above literally provides only for inspection, but any inspection necessarily implies a search and, by reasonable interpretation of legislative intent, a seizure. See Tallman, supra, p. 617, fn. 12, 365 N.W.2d 724, interpreting M.C.L. Sec. 308.1b(2)(e); M.S.A. Sec. 13.1491(2)(2)(e).

(2) and (3). The State Legislature obviously views the governmental interest in regulation as being very important. Legislative regulations have been in effect for more than 60 years. 1921 P.A. 46. The degree of importance which the Legislature attaches to such regulations is also evidenced by the detail which appears in the regulatory legislation, M.C.L. Sec. 257.201 et seq.; M.S.A. Sec. 9.1901 et seq., and by the wealth of administrative rules adopted by such agencies as the Department of State and the Department of State Police pursuant to legislative authority. Further, it is a matter of common knowledge that automobile theft and the stripping of stolen automobiles to salvage parts are significant national problems which deserve significant governmental attention.

(4). Despite the profusion of regulations pertaining to almost all aspects of the automobile and automobile parts businesses, we are not aware of any administrative rules which limit the search authorized by the quoted statute. Whether there are reasonable limitations on searches must therefore be determined from the statute itself.

Statutes are cloaked with a presumption of constitutionality. The court has a duty to construe the statute so as to avoid constitutional difficulties and [146 MICHAPP 43] in a manner that comports with a finding of constitutionality. Royal Auto Parts v. Michigan, 118 Mich.App. 284, 289, 324 N.W.2d 607 (1982). Where a statute would otherwise be unconstitutional, a narrowing construction should be given so as to render it constitutional if such is possible without doing violence to the Legislature's intent in enacting the statute. People v. Wilson, 139 Mich.App. 205, 209, 362 N.W.2d 798 (1984).

Defendant argues that the Michigan statute does not contain reasonable limitations and therefore cannot stand constitutional scrutiny. Defendant relies on Bionic Auto Parts & Sales, Inc. v. Fahner, 721 F.2d 1072 (C.A. 7, 1983), where the plaintiff sought an injunction against enforcement of a provision of the Illinois vehicle code which reads as follows:

"Every record required to be maintained under this Section shall be open to inspection by the Secretary of State or his authorized representative or any peace officer for inspection at any reasonable time during the night or day. Such inspection may include examination of the premises of the licensee's established place of business for the purpose of determining the accuracy of required records."

The district court held that the broad authorization for searches without warrants vested excessive discretion in the state officials and granted injunctive relief. Following the decision of the district court but prior to an opinion by the Seventh Circuit Court of Appeals, Illinois added a provision to its vehicle code which included a legislative finding that a system of mandatory licensing, record keeping, and inspection was necessary to reduce the transfer or sale of stolen motor vehicles or their parts within the State of Illinois. The new legislation provided that certain [146 MICHAPP 44] designated peace officers are allowed to inspect individuals and facilities licensed under the motor vehicle code, and that the inspection is to include a review of records and an inspection is to include a review of records and an inspection of those portions of the premises used by the licensee to store vehicles and parts reflected by the required books and records. The legislation also provides that a licensee or his representative is entitled to be present during any such inspection, that inspection may be initiated at any time that business is being conducted or work is being performed on the licensed premises whether or not the premises may be open to the public at the time, that any such inspection shall not continue for more than 24 hours after initiation, and that no more than 6 inspections of premises may be conducted within any 6-month period except pursuant to a search warrant.

Because of the new legislation...