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UNITED STATES v. ONE 1962 FORD THUNDERBIRD

August 20, 1964

UNITED STATES OF AMERICA, PLAINTIFF,
v.
ONE 1962 FORD THUNDERBIRD SERIAL NUMBER 2Y83Z124318, DEFENDANT.



The opinion of the court was delivered by: Will, District Judge.

This is a proceeding instituted by a libel seeking forfeiture of the vehicle-defendant pursuant to the provisions of 49 U.S.C. § 782, which provides in relevant part as follows:

    "Any vessel, vehicle, or aircraft which has been or
  is being used in violation of any provision of
  section 781 of this title, or in, upon, or by means
  of which any violation of said section has taken or
  is taking place, shall be seized and forfeited:
  Provided, That no vessel, vehicle, or aircraft used
  by any person as a common carrier in the transaction
  of business as such common carrier shall be forfeited
  under the provisions of this chapter unless it shall
  appear that (1) in the case of a railway car or
  engine, the owner, or (2) in the case of any other
  such vessel, vehicle, or aircraft, the owner or the
  master of such vessel or the owner or conductor,
  driver, pilot, or other person in charge of such
  vehicle or aircraft was at the time of the alleged
  illegal act a consenting party or privy
  thereto; * * *".

Intervenor, Hotpoint Employees' Credit Union (Credit Union) moves to dismiss the libel, alleging that the statutory provision is unconstitutional.

The following facts are admitted for the purposes of this motion:

  (1) Credit Union is the holder of a note, secured by
  a chattel mortgage on the above-named vehicle.
  (3) On or about March 21, 1963, the vehicle was
  seized by the United States on the undisputed
  allegation that Carlos Aulet, mortgagor and debtor to
  the Credit Union, used the vehicle for the
  transportation of narcotics in violation of
  applicable federal laws.

Credit Union's challenge to the constitutionality of the statute rests on three grounds; first, that it impairs the obligation of a contract, inasmuch as forfeiture will cancel the lien and the chattel mortgage; second, that the statute is vague, indefinite and uncertain in that no provision is made for holders of a security interest; and third, that the statute violates the due process provisions of the Fifth Amendment to the Constitution by taking the security interest of innocent lienors without compensation.

The first of these challenges may be disposed of in short order. The contracts clause of the Constitution (Art. I, § 10) is restricted to state action. It is not directed against the federal government. The federal government need only adhere to the due process requirements of the Fifth Amendment. Miller v. Howe Sound Min. Co., 77 F. Supp. 540, 545 (E.D.Wash. 1948). No due process argument can be maintained on this ground. A contractual obligation is not impaired by a statute in effect prior to the contract date. Oshkosh Waterworks v. Oshkosh, 187 U.S. 437, 446, 23 S.Ct. 234, 47 L.Ed. 249 (1903). The statute here involved was enacted in 1939, long before Credit Union's contract.

Second, the statute is neither vague, indefinite nor uncertain. If anything, it is the clarity of the statutory language, leaving no room for a construction affording protection to innocent lienors, which raises the question of its constitutionality. As Judge Wilson of the Eastern District of Tennessee has observed, "(t)he laws relating to forfeitures do cause one who is raised in the traditions of the Anglo-American principles of justice and who is committed to the constitutional principles of due process and just compensation to search closely for a constitutional violation." United States v. One 1961 Cadillac Hardtop Automobile, 207 F. Supp. 693, 698 (E.D.Tenn. 1962). To be sure, Congress has enacted more explicit statutes, stating unqualifiedly that "no property rights shall exist in any such property", 26 U.S.C. § 7302, United States v. One 1958 Pontiac Coupe, 298 F.2d 421, 422 (7 Cir. 1962), just as it has, on occasion, made provisions for innocent lienors in other forfeiture enactments. See, e.g., § 26, National Prohibition Act, 41 Stat. 305, 315; see also, 18 U.S.C. § 3615, 3617. Where there has been doubt as to the application of either a forfeiture statute protecting innocent lienors or one which was silent, the Supreme Court has held that the statute protecting innocent lienors should apply. Richbourg Motor Co. v. United States, 281 U.S. 528, 50 S.Ct. 385, 74 L.Ed. 1016 (1930). No such doubt is present here.

It is for Congress to select the language which expresses its legislative judgments. The courts only ask if that expression clearly communicates the result. We cannot, under the guise of vagueness, nullify a statute which enacts a policy with which we may not agree.

The third argument advanced by Credit Union, violation of the due process clause of the Fifth Amendment, poses greater difficulty. For clarity, this argument must be considered in three parts; first, that forfeiture takes the property of an innocent lienholder without just compensation; second, that in making a statutory exception for common carriers, Congress has traversed the bounds of due process by denying lien-holders the equal protection of the law; and third, that while Congress has provided a procedure for seeking remission of forfeiture, this procedure fails to accord the necessary constitutional protections to one seeking remission.

Turning to the first point, it is conceded that decrees of forfeiture are well-established as exercises of governmental power. Their roots, as the Supreme Court has noted, reach back to the law of deodand and even to the Mosaic law. Goldsmith, Jr. — Grant Co. v. United States, 254 U.S. 505, 510-511, 41 S.Ct. 189, 65 L.Ed. 376 (1921). Under these influences, the fiction of an in rem proceeding has been maintained. It is the vehicle which is the defendant. Were the fiction followed full-length, one might argue that forfeiture is not a taking of property. It is as if the obligation became worthless by virtue of the execution of the debtor for a crime. Thus the lien, an obligation attached to the car, becomes worthless when the car is forfeited. Just as execution of the criminal was not a taking of the creditor's property, so forfeiture is not a "taking" of the lien. We prefer, however, to consider the statutory enactments on grounds more suitable than those which stem from the fiction of an in rem proceeding.

We reject any contention that, inasmuch as the personal obligation underlying the lien remains, Credit Union suffers no loss. Recordation of a lien creates a vested property right. While the prior existence of the statute obviates any question of due process as previously indicated, it does not necessarily follow that a lienor's property right is, as a result of the statute, conditional, and therefore subject to divestment by forfeiture on the happening of a subsequent act. While every contract is made subject to existing law, we are not satisfied that this principle necessarily applies where the statutory provisions are penal in nature. A forfeiture statute is a penal statute. United States v. One 1947 Oldsmobile Sedan, 104 F. Supp. 159, 161 (1952). It is to be narrowly construed and we hesitate to imply an intent to affect contracts from a statute which looks only to criminal conduct and is wholly silent on contractual rights ...


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