U.S. v. Real Property Located at Incline Village, No. CV-N-90-0130-ECR.

CourtUnited States District Courts. 9th Circuit. United States District Courts. 9th Circuit. District of Nevada
Writing for the CourtEdward C. Reed, Jr.
Citation976 F.Supp. 1321
Docket NumberNo. CV-N-90-0130-ECR.
Decision Date02 July 1997
PartiesUNITED STATES of America, Plaintiff, v. REAL PROPERTY LOCATED AT INCLINE VILLAGE et al., Defendants.
976 F.Supp. 1321
UNITED STATES of America, Plaintiff,
No. CV-N-90-0130-ECR.
United States District Court, D. Nevada.
July 2, 1997.

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Harry A. Harbin, Asst. Chief and Mark D. Rubino, Trial Atty., U.S. Dept. of Justice, Criminal Div., Asset Forfeiture and Money Laundering Section, Washington, DC, for Plaintiff U.S.

David B. Smith, English & Smith, Alexandria, VA, for Violet Degen.

Lawrence S. Robbins, Alan E. Untereiner and Robert L. Bronston, Mayer, Brown and Platt, Washington, DC, for Brian Degen.


EDWARD C. REED, Jr., District Judge.

This is a civil action in rem by the United States to forfeit certain property as the fruits or instrumentalities of crime, pursuant to the Controlled Substances Act of 1970, 21 U.S.C. § 881. On January 30, 1997, the court ruled that Claimant Brian Degen was entitled to recover from Plaintiff the United States the rents accrued on real property seized from him by the government without affording him any pre-seizure notice and opportunity to contest the existence of probable cause, in violation of Degen's rights under the Due Process Clause of the Fifth Amendment to the U.S. Constitution. United States v. James Daniel Good Real Property, 510 U.S. 43, 114 S.Ct. 492, 126 L.Ed.2d 490 (1993). The facts and prior proceedings in this matter are set out in the court's Order of January 30, 1997 (Doc. # 143); that Order is published as United States v. Real Property Located at Incline Village, 958 F.Supp. 482 (D.Nev.1997).

In accordance with the prior instructions of the court, Claimant Degen furnished proof of his ownership interests in the items of real property the rents accrued on which he was entitled to under Good. The court issued its findings of fact and conclusions of law regarding the nature and extent of Claimant's ownership interests in ten separate items of real property. The court found that one of those items, certain residential real property located at 6668 West Lake Boulevard, in Homewood, California, was held not solely by Claimant Degen, but in joint tenancy by him and his mother, Violet Degen. The court made this finding despite the assertion, in a sworn declaration by Violet Degen, that her "intent" in transferring ownership of the property, by grant deed dated August 31, 1978, was to convey sole and exclusive ownership to her son, Claimant herein. The language of the grant deed, the court concluded, expressed a clear intent to create a joint tenancy in Violet Degen and Brian Degen, and therefore created a valid joint tenancy

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under California real property law, Cal. Civ. Code § 683. Because under California law the express language of a deed may not be overcome by parol evidence, Mello v. Weaver, 36 Cal.2d 456, 224 P.2d 691 (1950); Nathan v. Dierssen, 134 Cal. 282, 66 P. 485 (1901), Violet Degen's declaration of her subjective intent was a nullity. She is joint owner with her son of the property at 6668 West Lake Boulevard. Order filed April 28, 1997 at 16 (Doc. # 162).

Violet Degen has now moved (Doc. # 166) for leave to file her own claim to the West Lake Boulevard house. The United States opposes (Doc. # 169) on the grounds that under Fed.R.Civ.P. Supp. R. C(6), a claim to property upon which civil in rem process has been executed must be filed within ten days after execution of that process.

Procedure in civil in rem forfeiture actions is governed by the Federal Rules of Civil Procedure to the extent consistent with the Supplemental Rules for Certain Admiralty and Maritime Claims, and otherwise by the Supplemental Rules themselves. See 18 U.S.C. § 981(b)(2); 21 U.S.C. § 881(b); United States v. One 1978 Piper Cherokee Aircraft, 91 F.3d 1204, 1208 (9th Cir.1996); United States v. 105,800 Shares of Common Stock of FirstRock Bancorp, Inc., 825 F.Supp. 191 (N.D.Ill.1993); United States v. $5,372.85 United States Coin and Currency, 283 F.Supp. 904 (S.D.N.Y.1968).

In a civil forfeiture proceeding it is the valid seizure of the res which confers in rem jurisdiction; the seizure is prerequisite to the initiation of the action. Republic Nat'l Bank of Miami v. United States, 506 U.S. 80, 113 S.Ct. 554, 121 L.Ed.2d 474 (1992); The Brig Ann, 13 U.S. (9 Cranch) 289, 3 L.Ed. 734 (1815). A court must have actual or constructive control of the res when an in rem forfeiture action is commenced. United States v. James Daniel Good Real Property, 510 U.S. 43, 57-58, 114 S.Ct. 492, 502-03, 126 L.Ed.2d 490 (1993). The "seizure of the res, and publication of the monition or invitation to appear is regarded as equivalent to the particular service of process in law and equity." Republic Nat'l Bank, 506 U.S. at 85, 113 S.Ct. at 557 (quoting Taylor v. Carryl, 61 U.S. (20 How.) 583, 589, 15 L.Ed. 1028 (1858)). "The seizure of the property, as thus seen, is made the foundation of the subsequent proceedings. It is essential to give jurisdiction to the court to declare a forfeiture." Pelham v. Rose, 76 U.S. (9 Wall.) 103, 19 L.Ed. 602 (1869).

Courts generally require claimants to follow the language of the Supplemental Rules to the letter. United States v. $38,000 in United States Currency, 816 F.2d 1538, 1547 (11th Cir.1987). Likewise, because forfeitures are viewed with judicial disfavor, "strict compliance with the letter of the law by those seeking forfeiture [i.e. the United States] must be required." Id. (citing United States v. One 1936 Model Ford V-8 De Luxe Coach, 307 U.S. 219, 226, 59 S.Ct. 861, 864-65, 83 L.Ed. 1249 (1939); United States v. One 1976 Ford F-150 Pick-Up, 769 F.2d 525, 527 (8th Cir.1985); United States v. One 1957 Rockwell Aero Commander 680 Aircraft, 671 F.2d 414, 417 (10th Cir.1982); United States v. One 1977 Cadillac Coupe DeVille, 644 F.2d 500, 501 (5th Cir. Unit B May 1981)); see also E.L. Strobin, Annotation, Lawfulness of Seizure of Property Used in Violation of Law as Prerequisite to Forfeiture Action or Proceeding, 8 A.L.R.3d 473, 482-84 (1966 & Supp.1995) (citing state court decisions strictly enforcing procedural requirement of valid seizure in forfeiture actions).

The federal Supplemental Rules for Certain Admiralty and Maritime Claims require claimants to property seized pending forfeiture under the Controlled Substances Act to file their claims within ten days after execution of process, absent leave of court extending such time. Fed.R.Civ.P. Supp. R. C(6). Process in civil in rem forfeiture consists of the seizure of the property. Republic Nat'l Bank, 506 U.S. at 85, 113 S.Ct. at 557-58.

The property in which Violet Degen seeks to claim an interest was seized by the U.S. Marshal on October 25, 1989 pursuant to a warrant for arrest in rem issued by this court. DEA Form 453 Seized Asset Receipt, appended as Ex. J to Complaint for Forfeiture in Rem (Doc. # 1). Proposed Claimant Violet Degen filed her Motion for Leave to

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File Late Claim (Doc. # 166) and its attached Claim on June 3, 1997. More than seven years have elapsed in the interim.

There exists, however, a not insignificant question whether the process by which the government seized the property was valid. If it was not, the ten-day limitations period for filing claims provided in Rule C(6) clock should not run from the date of an invalid seizure.

In United States v. James Daniel Good Real Property, 510 U.S. 43, 114 S.Ct. 492, 126 L.Ed.2d 490 (1993), the Supreme Court for the first time in the history of in rem civil forfeiture declared that the Due Process Clause of the Fifth Amendment to the Constitution of the United States requires the government to afford the owner of real property notice and a meaningful opportunity to be heard before it seizes the property. The Court of Appeals for the Ninth Circuit has interpreted Good as establishing such an owner's right to a remedy for an unconstitutional seizure; under United States v. Real Property Located at 20832 Big Rock Drive, 51 F.3d 1402, 1406 (9th Cir.1995), that remedy is the exclusion of evidence derived from the illegal seizure and the return of rents...

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