United States v. Bochnewych, John ( 2000 )


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  • In the
    United States Court of Appeals
    For the Seventh Circuit
    
    No. 99-4082
    
    United States of America,
    
    Plaintiff-Appellee,
    
    v.
    
    5 S 351 Tuthill Road, Naperville, Illinois,
    
    Defendant,
    
    
    Appeal of:    John Bochnewych,
    
    Claimant.
    
    
    
    Appeal from the United States District Court
    for the Northern District of Illinois, Eastern
    Division.
    No. 97 C 8887--James F. Holderman, Judge.
    
    
    Argued May 15, 2000--Decided December 5, 2000
    
    
    
      Before Flaum, Chief Judge, and Cudahy and
    Evans, Circuit Judges.
    
      Cudahy, Circuit Judge. On September 27,
    1997, DuPage County Sheriff’s Deputy
    Lance Todd responded to a complaint of
    barking dogs on Tuthill Road in
    Naperville, Illinois. At the address
    reported, he found a dilapidated house.
    Deputy Todd called the sheriff’s office
    and learned that Peter Boch was the owner
    of the property at 5 S 351 Tuthill Road.
    Boch had been arrested and convicted for
    possession of cannabis earlier that year.
    Claiming a concern for the health of the
    occupants, Deputy Todd and Deputy James
    Mendrick entered the residence. Inside,
    the deputies found ten closed ziplock
    bags containing a green leafy substance,
    another ziplock bag containing partially
    opened ziplock bags also holding a green
    leafy substance, a scale, a loaded Marlin
    30/30 lever action rifle and about
    fifteen discharged shotgun cartridges. In
    the basement they found three plant
    growing lights hanging from the ceiling,
    and a dozen ceramic pots filled with soil
    and connected to canisters of carbon
    dioxide gas.
    
      Later that day the officers obtained and
    executed a search warrant for the house.
    They seized several bags of leafy
    material, two containers of plant food,
    twenty-three plant pots with soil,
    timers, several plant growing lamps,
    packaging materials, a triple beam scale,
    seeds packaged in small containers, and
    an air heater. The leafy material was
    determined upon analysis to be eight
    pounds of marijuana. The quantity of
    marijuana and paraphernalia found in the
    home were determined to be consistent
    with manufacturing and distributing
    marijuana.
    
      On December 23, 1997, the United States
    filed a verified complaint for forfeiture
    under 21 U.S.C. sec. 881(a)(7). The
    property to be forfeited may have looked
    like a typical residence to the average
    viewer. But it is, legally, unique in
    ways that complicated the forfeiture
    process. First, the property is legally
    described as "Lots 14 and 15 in Block 3
    of Arthur T. McIntosh Co.’s DuPage
    Farms," and each lot, or parcel, bears a
    different permanent index number in the
    DuPage County tax assessment records. The
    residence is located on parcel number 08-
    08-202-012. Parcel 08-08-202-013 is
    vacant. The two parcels are taxed
    separately.
    
      Further, although Peter Boch purchased
    both parcels together, and paid $25,000
    to his wife upon their divorce to obtain
    her interest in the property, Boch had
    since tried to distance himself from the
    vacant half of the land. On October 8,
    1985, Boch placed the vacant half of the
    land in trust, and that same day
    transferred his interest in the trust to
    his father, John Bochnewych. A Naperville
    bank serves as trustee. Shortly after the
    trust was created, in December of 1985, a
    confidential informant identified Boch as
    a multi-kilogram distributor of cocaine
    in Illinois.
    
      The relevant terms of the trust state:
    
    The interest of each and every
    beneficiary hereunder and of all persons
    claiming under them or any of them shall
    be only in earnings, avails, and proceeds
    arising from the sale or other
    disposition of said real estate and each
    interest is hereby declared to be
    personal property, and no beneficiary
    hereunder shall have any title or
    interest, legal or equitable, in or to
    said real estate as such, but only an
    interest in the earnings, avails and
    proceeds thereof as aforesaid.
    
    The trust instrument further states that
    the trustee shall have, among other
    things:
    
    [f]ull Power and authority . . . to
    improve, manage, protect, and subdivide
    said premises or any part thereof . . .
    to contract to sell, to grant options to
    purchase, to sell on any terms, to
    convey, either with or without
    consideration, to convey said premises or
    any part thereof to a successor or
    successors in trust and to grant to such
    successor or successors in trust all of
    the title, estate, powers and authorities
    vested in said trustee, to donate, to
    dedicate, to mortgage, pledge or
    otherwise encumber, said property, or any
    part thereof, to lease said property or
    any part thereof from time to time . . .
    .
    
    Gov’t Resp. to Claimant’s Motion to Quash
    and Suppress, Ex. 4A (hereinafter Trust
    Agreement).
    
      Boch possesses all of the deeds,
    contracts, insurance policies and other
    official documents relating to the
    property. Boch secured a mortgage on the
    property and made the payments. Boch also
    paid the taxes and utilities on the
    property. Additionally, Boch permitted
    friends and acquaintances to store their
    vehicles on the vacant land without
    securing his father’s permission for them
    to do so.
    
      Bochnewych had not been inside the house
    on the defendant property for
    approximately twenty years and believes
    it to have been vacant since 1994.
    Bochnewych stated that he does not know
    any details of the mortgage. Bochnewych
    is unaware of the dates of any leases or
    rentals of the property, and the only
    information he could provide was, "I know
    [Peter] rented [it]." Appellant’s Motion
    to Dismiss, Ex. B at 17 (hereinafter
    Bochnewych Dep.). Bochnewych never
    received any rent on the property.
    Bochnewych stated that he does not know
    what obligations or rights Boch retained
    after placing the property in trust.
    
      Bochnewych claims to have known nothing
    about the illegal activity on the
    property. When asked whether he did
    anything to assure that the use of the
    property was legal Bochnewych stated, "I
    don’t know that. It’s all [Peter’s]." Id.
    at 60.
    
      In October of 1997, Boch contracted to
    sell the property to William and Mayling
    Tein. The contract did not mention
    Bochnewych or the trust and Bochnewych
    did not sign the agreement. On the other
    hand, Bochnewych did execute, along with
    Boch, a direction to the trustee to
    convey the property to William Tein. The
    sale was never completed because of a
    lien on the property.
    
      Bochnewych contested the forfeiture,
    claiming he was the owner of the vacant
    parcel, and an innocent owner at that.
    Based on his professed innocent
    ownership, Bochnewych moved to quash the
    search warrant regarding the property at
    5 S 351 Tuthill Road and to suppress the
    evidence obtained by the search. The
    district court denied the motion.
    
      The parties filed cross motions for
    summary judgment. The district court
    denied Bochnewych’s motion for summary
    judgment due to his failure to submit a
    Local Rule 12(M) statement. Because of
    this failure, the district court deemed
    the facts in the government’s Local Rule
    12(M) statement admitted. Based on those
    facts the district court found that
    Bochnewych lacked Article III standing to
    contest the forfeiture and granted the
    government’s motion for summary judgment.
    The district court denied Bochnewych’s
    motion for reconsideration and made a
    final entry of judgment of forfeiture.
    Bochnewych appeals from the judgment
    granting the government’s motion for
    summary judgment and the denial of
    Bochnewych’s motion for summary judgment.
    The decree of forfeiture to the United
    States was made subject to the interests
    of Allegiant Bank, FSB, the holder of a
    mortgage interest in the property, and
    subject to the interest of the DuPage
    County Treasurer in the unpaid real
    estate taxes on the property.
    I.   Article III Standing
    
      We must first resolve whether
    Bochnewych, as the beneficiary of a land
    trust, has standing to challenge the
    government’s effort to forfeit the land
    that is the subject of the trust.
    Bochnewych’s standing to contest the
    forfeiture is a question of law, which we
    review de novo. See United States v. 5000
    Palmetto Drive, 
    928 F.2d 373
    , 375 (11th
    Cir. 1991).
    
      In order to decide whether Bochnewych’s
    interest in the land gives rise to
    standing, we must clarify what that
    interest is. State law defines and
    classifies property interests for
    purposes of the forfeiture statutes,
    while federal law determines the effect
    of the property interest on the
    claimant’s standing. See United States v.
    Lester, 
    85 F.3d 1409
    , 1412 (9th Cir.
    1996). The garden variety Illinois land
    trust gives trust beneficiaries "full
    powers of direction and control," and
    deems these rights to be personal
    property. Quinn v. Pullman Trust & Sav.
    Bank, 98 Ill.App.2d 402, 404 (1968). Had
    Boch set up such a trust here, the case
    would be easier because Bochnewych would
    essentially be the owner of the property.
    That was the situation the Fourth Circuit
    confronted in United States v. Santoro,
    
    866 F.2d 1538
     (4th Cir. 1989). Upon
    divorcing his wife, a man conveyed his
    one-half interest in property to his wife
    with the understanding that it would be
    used for the maintenance and education of
    the children. See id. at 1544. The court
    concluded that the children were
    beneficial owners of one-half of the
    property, and therefore had standing. See
    id. at 1545.
    
      But Boch appears to have established an
    unorthodox land trust. While beneficiary
    Bochnewych has an interest in the
    "earnings, avails, and proceeds arising
    from the sale or other disposition of
    said real estate," the beneficiary does
    not have the power to manage, lease or
    sell the property. Moreover, a trust
    provision permits the trustee to sell the
    property "on any terms, with or without
    consideration." So unlike the children in
    Santoro, whose trustee presumably had an
    obligation to maximize the proceeds from
    the land, Bochnewych’s trustee may sell
    the land for a peppercorn if he wishes.
    It is not exactly right, therefore, to
    call Bochnewych a beneficial owner of the
    land. This was essentially the basis for
    the district court’s decision; it
    reasoned that because Bochnewych did not
    have legal or equitable title to the real
    estate itself, he could not have
    standing. See Mem. at 8-9. But the fact
    remains that should the property be sold
    for any amount of money, that money is
    due to Bochnewych. So Bochnewych’s
    interest is a right to future proceeds of
    unknown value. Does that interest
    establish that Bochnewych has Article III
    standing? We answer that question by
    reviewing the purpose of Article III
    standing.
    
      Under Article III of the Constitution,
    the federal judicial power extends only
    to "cases" or "controversies." This limi
    tation on judicial power assures that
    courts play a "proper--and properly
    limited--role . . . in a democratic
    society." Family & Children’s Ctr., Inc.
    v. School City of Mishawaka, 
    13 F.3d 1052
    , 1058 (7th Cir. 1994) (quoting Warth
    v. Seldin, 
    422 U.S. 490
    , 498 (1975)). To
    satisfy Article III, a plaintiff must
    allege (1) an immediate threat of injury;
    (2) fairly traceable to the defendant’s
    conduct; that (3) a favorable federal
    court decision likely would redress or
    remedy. See Lujan v. Defenders of
    Wildlife, 
    504 U.S. 555
    , 561-62 (1992).
    There is no question that prongs two and
    three are met in this case. The dispute
    is whether Bochnewych, who does not own
    or control the land or its sale price,
    faces an immediate threat of injury if
    the land is forfeited. We have described
    the Article III standing requirements as
    "undemanding." Family & Children’s Ctr.,
    14 F.3d at 1058. It is instructive in
    this case to review the injuries that are
    not sufficiently "concrete or
    particularized" to establish standing.
    Id. at 560-61. We have stated that a
    plaintiff who has merely an "intellectual
    or academic curiosity" in the outcome of
    a suit does not have standing. S. E. Lake
    View Neighbors v. Dep’t of Hous. and
    Urban Dev., 
    685 F.2d 1027
    , 1033 (7th Cir.
    1982). "Purely psychological harm"
    suffered by a plaintiff is not sufficient
    to establish standing. Freedom From
    Religion Found., Inc. v. Zielke, 
    845 F.2d 1463
    , 1467 (7th Cir. 1988). Similarly,
    "simple indignation," or an impact on
    "one’s opinions, aspirations or ideology"
    do not suffice to establish standing.
    Harris v. City of Zion, 
    927 F.2d 1401
    ,
    1405 (7th Cir. 1991) (quoting in part
    People Organized for Welfare and
    Employment Rights v. Thompson, 
    727 F.2d 167
    , 171 (7th Cir. 1984)). But, if the
    Naperville residence is forfeited,
    Bochnewych will suffer an injury that is
    more than intellectual, psychological or
    ideological. He will lose the opportunity
    to receive the proceeds, if and when the
    land is sold. We think this is more than
    enough to give him an actual stake in the
    outcome of the suit, and to make his
    dispute with the government a genuine
    "case or controversy" justifying our
    exercise of judicial review.
      We recognize that this conclusion may
    appear to be in tension with those of
    some sister circuits, which have held
    that in the unique setting of drug-
    related forfeiture cases, a plaintiff
    does not have a stake in the outcome of
    the dispute--even if he is ostensibly the
    owner--unless he exercises "dominion and
    control" of the res. See, e.g., United
    States v. 526 Liscum Dr., 
    866 F.2d 213
    ,
    217 (6th Cir. 1989); United States v. 900
    Rio Vista Blvd., 
    803 F.2d 625
    , 630 (11th
    Cir. 1986); United States v. One 1945
    Douglas C-54 (DC-4) Aircraft, 
    604 F.2d 27
    (8th Cir. 1979). Using this "dominion and
    control" formulation, the Ninth Circuit
    held in a case similar to the one before
    us today that where a man gave his
    father-in-law title to land, but
    continued to pay property taxes, to
    manage the rental property and to control
    access to the land himself, the father-
    in-law did not have a sufficient interest
    to give rise to standing. See United
    States v. Vacant Land, 
    15 F.3d 128
    , 130
    (9th Cir. 1993). The court explained that
    "[t]hese cases turn on a finding that the
    title holder is a strawman holding
    nominal title as a subterfuge for a drug
    trafficker, rather than being a true
    owner of an interest in the property."
    See id.
    
      As a matter of public policy, we can see
    the reason for closing courts to these
    claims of nominal owners, because they
    are in furtherance of an illegal and
    socially destructive purpose. But the
    social imperatives at work in these cases
    hardly justifies characterizing the
    problem as one of constitutional
    standing. We require a plaintiff to
    demonstrate standing in order to assure
    that we are refereeing an actual, rather
    than a hypothetical, dispute. See Lujan,
    504 U.S. at 560-61. Indeed, we police a
    plaintiff’s standing precisely to ensure
    that we are acting as a court, rather
    than as "ombudsmen of the general
    welfare," a role more properly ascribed
    to Congress. Valley Forge Christian Coll.
    v. Americans United for Separation of
    Church and State, Inc., 
    454 U.S. 464
    , 487
    (1982). It seems to us that in
    scrutinizing a would-be forfeiture
    plaintiff’s interest for evidence of
    straw ownership, courts are not policing
    their own exercise of power, but policing
    those whom they perceive to be doing the
    bidding of drug traffickers, by refusing
    to provide an avenue of legal redress.
    One might call it judicial abdication in
    the service of judicial activism. Cf.
    Marrese v. Am. Acad. of Orthopaedic
    Surgeons, 
    726 F.2d 1150
     (7th Cir. 1984)
    (dissenting opinion).
    
      The "dominion and control" inquiry as
    applied to Bochnewych’s claim seems to
    focus more on the prudential dimension of
    standing than the "injury-in-fact"
    dimension. Even under the former heading,
    we think the more stringent test is
    misguided on the present facts. The
    legislative history of forfeiture law
    "indicates that a rather expansive ’zone
    of interests’ is protected by the
    innocent owner provision." United States
    v. U.S. Currency, $81,000, 
    189 F.3d 28
    (1st Cir. 1999). Moreover, we note that
    both the Supreme Court and the Congress
    have recognized the potentially draconian
    reach of the civil forfeiture laws, in
    the years since our sister circuits
    adopted the "dominion and control" test
    for forfeiture cases. In April of this
    year, Congress passed the Civil Asset
    Forfeiture Reform Act of 2000, which
    requires the government to prove the
    connection between the property to be
    forfeited and the drug activity by a pre
    ponderance of the evidence, rather than
    to prove merely probable cause to believe
    there is a connection. See Pub. L. No.
    106-185, 114 Stat. 202 (2000). And
    several years ago, the Supreme Court
    issued a trilogy of opinions truncating
    the long arm of civil forfeiture. See
    United States v. James Daniel Good Real
    Prop., 
    510 U.S. 43
     (1993) (holding that
    owners are entitled to court hearings
    before government may seize allegedly
    drug-tainted property); Austin v. United
    States, 
    509 U.S. 602
     (1993) (holding that
    the Excessive Fines Clause applies to
    civil forfeitures); United States v.
    Parcel of Land Known as 92 Buena Vista
    Ave., 
    507 U.S. 111
     (1993) (upholding the
    innocent owner defense). In light of the
    other branches’ calls for rational
    application of the useful tool of civil
    forfeiture, we think it particularly
    imprudent to adopt without a specific
    reason a test that appears to increase
    the harshness of the forfeiture remedy.
    So we will hew to the traditional "actual
    stake in the outcome" test in analyzing
    whether Bochnewych has standing to
    challenge the government in this case.
    The facts suggest that he does have a
    sufficient interest in the land to give
    him an actual stake in the outcome of
    this dispute, even though he may not own,
    dominate or control the land.
    
      Two cases are particularly instructive
    in reaching this conclusion. In both, the
    would-be plaintiff, like Bochnewych,
    stood to gain money indirectly from the
    outcome of a dispute between two other
    parties. In both, we concluded that the
    third party had standing to sue based on
    the other parties’ dispute. In Family &
    Children’s Ctr., Inc. v. Sch. City of
    Mishawaka, 
    13 F.3d 1052
     (7th Cir. 1994),
    we held that a facility with physical
    (but not legal) custody of children with
    disabilities had standing to sue the
    local school district for allegedly
    withholding special education funds from
    the children. Although the dispute was
    properly between the children (or their
    parents) and the school district, we held
    that if the school district did turn over
    funds for the children, the child care
    facility would benefit financially, and
    therefore it, too, had standing. See id.
    at 1059. Similarly, in Amato v. Wilentz,
    
    952 F.2d 742
     (3d Cir. 1991), the Third
    Circuit held that a county had standing
    to sue the state’s chief justice for a
    First Amendment violation when the chief
    justice denied a movie company permission
    to film in the county courthouse. The
    Third Circuit agreed with the county that
    although the chief justice directly hurt
    the movie company, the county was
    indirectly hurt because it lost out on
    the $250,000 rental fee the movie company
    had promised it. Therefore, the county
    had a right to sue the chief justice.
    "That is our standing. We want the
    money," the county told the court. See
    id. at 747 n.5.
    
      Just so here. Although the facts before
    us suggest that Peter Boch may have had
    dominion and control of the vacant
    property, that does not mean his father
    had no stake in the outcome of the
    forfeiture dispute. John Bochnewych has,
    according to the terms of the trust, the
    right to any proceeds realized from the
    sale of the property. That is his
    standing. He wants the money, or at least
    the legal right to it should the property
    be sold. Of course, we recognize that
    Bochnewych may have extinguished that
    right if he participated in or endorsed
    his son’s drug operation. So the real
    issue in this case is whether Bochnewych
    can be implicated in the drug activity.
    We think it best to confront the issue of
    Bochnewych’s role in the offense head-on
    rather than evade it by barring him from
    the courthouse. We therefore reverse the
    district court, and hold that Bochnewych
    has standing to contest the government’s
    forfeiture efforts in this case.
    
    II.   Severance of Land
    
      This leaves us with the question whether
    Bochnewych may block the forfeiture of
    the vacant half of the land because it is
    a separate parcel on which no drug
    activity has occurred or because--even if
    it was the site of drug activity--he is
    an innocent owner. The district court did
    not analyze these issues in its opinion,
    since it decided Bochnewych did not have
    standing. Indeed, Bochnewych himself
    devoted just one paragraph of his six-
    page motion for summary judgment to the
    argument that the parcels were severable.
    In its cross-motion for summary judgment,
    the government never squarely addressed
    the argument that the parcels should be
    severed for forfeiture purposes. On
    appeal, Bochnewych does not ask us to
    decide this issue, but only asks that the
    case be remanded for a trial on the
    issue. The government urges us to affirm
    the district court’s grant of summary
    judgment in its favor. Summary judgment
    is proper "if the pleadings, depositions,
    answers to interrogatories and admissions
    on file, together with the affidavits, if
    any, show that there is no genuine issue
    as to any material fact and that the
    moving party is entitled to judgment as a
    matter of law." Fed. R. Civ. P. 56(c). A
    genuine issue of material fact exists for
    trial when, in viewing the record and all
    reasonable inferences drawn from it in a
    light most favorable to the non-movant, a
    reasonable jury could return a verdict
    for the non-movant. See Anderson v.
    Liberty Lobby, Inc., 
    477 U.S. 242
    , 248
    (1986).
    
      The forfeiture statute broadly states
    that "[a]ll real property, including any
    right, title, and interest in the whole
    of any lot or tract of land . . . which
    is used, or intended to be used, in any
    manner or part, to commit, or to
    facilitate the commission of" a drug
    offense is forfeitable. 21 U.S.C. sec.
    881(a)(7). In a civil forfeiture
    proceeding under the law in effect at the
    time of this forfeiture, the government
    must show probable cause that the
    property is subject to forfeiture. Once
    the government has made this showing,
    which has been defined as "reasonable
    grounds for belief of guilt, supported by
    less than prima facie proof but more than
    mere suspicion," United States v. 1982
    Yukon Delta Houseboat, 
    774 F.2d 1432
    ,
    1434 (9th Cir. 1985), the burden shifts
    to the claimant to prove by a
    preponderance of the evidence that the
    property was not unlawfully used or that
    he did not know about or consent to the
    illegal use. See United States v. 7715
    Betsy Bruce Lane, 
    906 F.2d 110
     (4th Cir.
    1990).
    
      In this circuit, we consider property
    forfeitable if its connection to the
    underlying drug transaction is "more than
    incidental or fortuitous." United States
    v. 916 Douglas Ave., 
    903 F.2d 490
    , 494
    (7th Cir. 1990). However, we have stated
    that our test is only semantically
    distinguishable from the "substantial
    connection" test used in other circuits.
    See 916 Douglas Avenue, 903 F.2d at 494.
    Therefore, we may survey cases inside and
    outside our circuit for guidance in
    determining whether the Boch property is
    severable from the Bochnewych land held
    in trust.
    
      In United States v. Santoro, 
    866 F.2d 1538
     (4th Cir. 1989), the court
    considered farm property held by a single
    owner (whose children were beneficial
    owners of one-half the entire property by
    virtue of a trust) bisected by a road and
    taxed as two separate parcels. The legal
    description of the property treated the
    whole of the land as one unitary tract.
    The drug transactions leading to
    forfeiture had taken place on the smaller
    of the two portions of the land, but the
    government was permitted to forfeit all
    of the land. The court reasoned that the
    property was legally described as a
    single tract, despite the existence of
    the road and the fact that the two
    portions were taxed separately. Further,
    the land was held by a single owner who,
    when she designed a trust to benefit her
    children, placed the entire piece of
    property in trust.
    
      The scenario we confront today is
    different enough that we cannot say as a
    matter of law that this house and this
    vacant lot were part of one unitary
    property. DuPage County taxes the house
    and the lot using two different
    identification numbers. Even the legal
    description of the property known as 531
    S Tuthill Road refers explicitly to "Lots
    14 and 15." Perhaps most critically, Boch
    placed the vacant lot, but not the house,
    in trust. This key fact distinguishes the
    case sharply from Santoro, where the
    owner placed the entire lot in trust.
    Where the owner has treated the property
    as unitary, it seems appropriate for the
    court to do so. But here, owner Boch has
    treated the two parcels as discrete,
    retaining one and legally distancing
    himself from the other. And we are
    missing key facts that will likely help
    the district court decide whether the
    parcels are truly unitary or truly
    divisible. In particular, there is no
    indication in the record how this--or
    these--properties are configured. Are we
    talking about a house and adjacent yard?
    Or are we talking about a house located
    next to a separate lot on which a second
    house could be constructed?/1 The
    record, as it stands currently, does not
    shed enough light on these issues to
    justify the grant of summary judgment for
    either party on the severance issue.
    
    III. Innocent Ownership
      One related issue remains. Bochnewych
    argued in his motion for summary judgment
    below, and on appeal, that he is an
    innocent owner. On appeal, the government
    has argued that drug activity took place
    in the house and that the trust parcel
    "was directly adjacent to the [house]."
    Appellee’s Br. at 15. The government also
    notes that Boch paid the taxes, utility
    bills and mortgages on both parcels. It
    concludes that "there were reasonable
    grounds to believe there was a nexus
    between [the vacant lot] and the activity
    taking place [next door]." Id. We suspect
    that when the district court takes this
    case on remand, it may require more in
    the way of evidence tying the vacant lot
    to the house, although this may depend on
    whether the house and the lot are found
    to be a single property or two separate
    properties. We are influenced in part by
    the fact that Congress, in its recent
    forfeiture reform initiative, raised the
    quantum of proof for connecting a
    forfeiture target with drug activity from
    probable cause to preponderance of the
    evidence./2 In the present case, there
    is nothing in the record to show that the
    vacant lot was the site of drug
    transactions, was used to grow drugs or
    was used to shield drug activity next
    door. There is only the allegation that
    the lot was located next to the drug
    cultivation center, and was maintained by
    Peter Boch.
    
      In any event, should the government
    satisfy the district court that the
    vacant lot was connected to the drug
    activity, Bochnewych will then have the
    opportunity to prove by a preponderance
    of the evidence that he was an innocent
    owner; that is, that he did not know
    about or consent to the illegal use. See
    United States v. 7715 Betsy Bruce Lane,
    
    906 F.2d 110
     (4th Cir. 1990). The
    government implies that Bochnewych
    consented to Boch’s use of the land by
    wholly neglecting to monitor it, visit it
    or even inquire about it with his son.
    Recall that when asked if he had taken
    any steps to assure that "his" land was
    used lawfully, Bochnewych replied "I
    don’t know that. It’s all [Peter’s]."
    Bochnewych Dep. at 60. While Bochnewych
    was obviously not a hands-on trust
    beneficiary, we think it is a slight
    stretch to interpret this statement as
    consent to the operation of a drug
    enterprise sufficient to withhold the
    innocent owner defense from Bochnewych as
    a matter of law. If Bochnewych has not
    been on the land for twenty years, it is
    possible, though perhaps not probable,
    that he did not know about the drug
    activity. And although Bochnewych’s
    deposition suggests a certain paternal
    indulgence, we are reluctant to transmute
    as a matter of law that all-too-human
    tendency into consent for his son to run
    a drug operation on the land. We think
    that a factfinder would be better off
    hearing Bochnewych’s live testimony in
    order to decide whether the father knew
    of or endorsed his son’s activity, and
    therefore whether the innocent owner
    defense is available to him.
    
      In sum, we reverse the grant of summary
    judgment in favor of the government on
    the Article III standing issue. And we
    decline to affirm the grant of summary
    judgment based on conclusions that the
    property is indivisible and Bochnewych
    was not an innocent owner. We remand the
    case to the district court for further
    proceedings on the issues of property
    indivisibility and innocent ownership in
    accordance with this opinion.
    
    /1 Not coincidentally, the divisibility of the
    properties may strengthen or weaken Bochnewych’s
    interest in the property. For instance, if the
    parcel in trust for him is merely a yard, it is
    unlikely to have much market value absent the
    accompanying house. In such a case, it would best
    serve the goals of forfeiture to treat the land
    as one because the house that served as the drug
    cultivation center dominated the land. And it
    would harm Bochnewych very little because his
    property would be nearly unsalable. But if the
    parcel in trust is a wholly autonomous lot, then
    it is both less apparent that the drug activity
    in the neighboring house tainted it, and more
    apparent that Bochnewych has something of value,
    because the property could be sold notwithstand-
    ing the forfeiture next door.
    
    /2 Under the Civil Asset Forfeiture Reform Act of
    2000, the burdens of proof have been reallocated,
    so that the government must prove the connection
    between the property to be forfeited and the drug
    activity by a preponderance of the evidence. The
    Supreme Court explained in Landgraf v. USI Film
    Products that although retroactive application of
    statutes is usually disfavored, in some situa-
    tions, "a court should ’apply the law in effect
    at the time it renders its decision.’" 
    511 U.S. 244
    , 272 (1994) (citing Bradley v. School Bd. of
    City of Richmond, 
    416 U.S. 696
    , 711 (1974)).
    Retroactive application is particularly appropri-
    ate where a procedural rule is changed after a
    suit arises "[b]ecause rules of procedure regu-
    late secondary rather than primary conduct . . .
    ." Landgraf, 511 U.S. at 275. The decision wheth-
    er to apply a new procedural rule "ordinarily
    depends on the posture of the particular case."
    Id. at 275 n.29. The district court knows the
    posture of this case best, and is in the best
    position to decide whether the old or new regime
    should apply on remand.
    

Document Info

DocketNumber: 99-4082

Judges: Per Curiam

Filed Date: 12/5/2000

Precedential Status: Precedential

Modified Date: 9/24/2015

Authorities (24)

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Warth v. Seldin , 422 U.S. 490 ( 1975 )

Lujan v. Defenders of Wildlife , 504 U.S. 555 ( 1992 )

United States v. Parcel of Rumson, NJ, Land , 507 U.S. 111 ( 1993 )

Valley Forge Christian College v. Americans United for ... , 454 U.S. 464 ( 1982 )

Anderson v. Liberty Lobby , 477 U.S. 242 ( 1986 )

United States v. Bulger , 189 F.3d 28 ( 1999 )

Landgraf v. USI Film Products , 511 U.S. 244 ( 1994 )

Austin v. United States , 509 U.S. 602 ( 1993 )

R. Anthony Marrese and Michael R. Treister v. American ... , 726 F.2d 1150 ( 1984 )

United States v. One 1945 Douglas C-54 (Dc-4) Aircraft, ... , 604 F.2d 27 ( 1979 )

United States v. James Daniel Good Real Property , 510 U.S. 43 ( 1993 )

South East Lake View Neighbors v. Department of Housing and ... , 685 F.2d 1027 ( 1982 )

people-organized-for-welfare-and-employment-rights-power-walter , 727 F.2d 167 ( 1984 )

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United States v. One Parcel of Real Estate Commonly Known ... , 903 F.2d 490 ( 1990 )

united-states-v-premises-known-as-526-liscum-drive-dayton-montgomery , 866 F.2d 213 ( 1989 )

United States v. One Parcel of Real Estate Located at 7715 ... , 906 F.2d 110 ( 1990 )

united-states-v-1982-yukon-delta-houseboat-vin-ydh33930781-1982-yukon , 774 F.2d 1432 ( 1985 )

united-states-v-a-single-family-residence-and-real-property-located-at-900 , 803 F.2d 625 ( 1986 )

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