State v. Bonds , 120 N.C. App. 546 ( 1995 )

WYNN, Judge.

Plaintiff appeals an order by the trial court compelling the Department of Revenue to remit $1,646.60 that it previously garnished from the Wayne County Sheriff’s Department. We reverse.

On 8 January 1993, law enforcement officers of the Wayne County Sheriff’s Department arrested defendant Willie Ray Bonds for possession of crack cocaine. At the time of his arrest, the defendant was also in possession of $2,715.00 located in his residence. This currency was seized by law enforcement as potential evidence, but defendant stated that it was money he had saved to repair two vehicles which were in the shop at the time. A Form BD-4 Report of Arrest and/or Seizure Involving Nontaxed (Unstamped) Controlled Substances was prepared by the Wayne County Sheriffs Department the day of the arrest and sent to the State Bureau of Investigation, who, pursuant to N.C. Gen. Stat. § 114-18.1 (1994), forwarded the report to the Department of Revenue.

A Notice of Controlled Substance Tax Assessment in the amount of $1,646.60 was issued by the Secretary of Revenue on 20 October 1993 to defendant and mailed to the last known address of the taxpayer pursuant to N.C. Gen. Stat. § 105-241.1 (1992). On that same date, Glenn Odom served a notice of garnishment issued by the Secretary of Revenue pursuant to N.C. Gen. Stat. § 105-242(b) (1992) upon the Wayne County Sheriff’s Department who complied with the garnishment by remitting to the Department of Revenue $1,646.60, representing payment in full of the assessed tax, penalty, and interest. The taxpayer neither objected to the assessment nor demanded a refund of taxes paid.

On 31 May 1994, Mr. Bonds pled guilty to possession of cocaine and was sentenced to an active term of two years. The trial court further ordered that the $2,715.00 seized at the time of the arrest be forfeited to the Wayne County School fund. That same day, the trial court ordered that the Department of Revenue be made a party to the criminal action pursuant to N.C. Gen. Stat. § 15-11.1 (1983) and to show cause why the funds collected by the Department should not be ordered returned to the Wayne County Sheriff’s Department. On 15 June 1994, notice of a hearing was issued to Janice H. Faulkner, Secretary of Revenue, and Glenn Odom, Revenue Enforcement Officer.

At the hearing on 6 July 1994, the trial court concluded that it had jurisdiction over the parties in the cause and that the currency seized by law enforcement officers from Mr. Bonds was defendant’s property and was taken as potential evidence in the criminal prosecution. The court also concluded that as potential evidence, it was not subject to garnishment by the Department of Revenue for the controlled substance tax. The court then ordered that the Department of Revenue “remit the seized currency in the amount of $1,646.60 back to the Wayne County Sheriff’s Department who shall then pay the same to.the Clerk of Superior Court who shall then pay over the same to the Finance Officer for Wayne County who shall then disburse the same to the local school administrative unit[s] in Wayne County entitled thereto.” From this order, the Department of Revenue filed notice of appeal.

We note initially that the case sub judice is not a forfeiture case. There are several methods in which law enforcement officers can lawfully seize personal property, including currency. One such method is pursuant to the controlled substances forfeiture statute which provides in pertinent part:

The following shall be subject to forfeiture: . . . [a] 11 money, raw material, products, and equipment of any kind which are acquired, used, or intended for use, in selling, purchasing, manufacturing, compounding, processing, delivering, importing, or exporting a controlled substance in violation of the provisions of this Article.

N.C. Gen. Stat. § 90-112(a)(l)(2) (1993). Such property must be held for safekeeping “until an order of disposition is properly entered by the judge.” N.C.G.S. § 90-112(c).

Law enforcement officers may also, incident to a valid arrest, seize any property which the arrested person has on him which is potential evidence of a crime. State v. Harris, 279 N.C. 307, 310, 182 S.E.2d 364, 367 (1971). N.C.G.S. § 15-11.1 (1983) provides the following:

If a law enforcement officer seizes the property pursuant to lawful authority, he shall safely keep the property under the direction of the court or magistrate as long as necessary to assure that the property will be produced and may be used as evidence in any trial.

Notwithstanding this general restriction, N.C.G.S. § 15-11.1(a) specifically authorizes the district attorney “upon his own determination, . . . [to] release any property seized pursuant to his lawful authority if he determines that such property is no longer useful or necessary as evidence in a criminal trial and he is presented with satisfactory evidence of ownership.”

We find N.C.G.S. § 15-11.1(a) to be dispositive. The trial court found that law enforcement seized the currency as potential evidence, rather than property subject to forfeiture pursuant to N.C.G.S. § 90-112(a) (2). Therefore, once the district attorney determined under N.C.G.S. § 15-11.1(a) that the potential evidence was not needed at trial, he had complete control to release the property to the lawful owner or to another entitled to possession without a court order.

In this matter, the district attorney did not contest, either at the trial level or before this court, the seizure of the proceeds by the Department of Revenue. The district attorney’s failure to designate the property as needed evidence or act in any way to deny release of the proceeds, establishes conclusively that the district attorney permitted release of the proceeds to the Department of Revenue under N.C.G.S. § 15-11.1(a). Therefore, the trial court was without authority to compel the Department to remit these funds. We also note that the taxpayer neither objected to the assessment nor demanded refund of the taxes paid. In fact, neither the defendant nor the school board contends before this court that they are entitled to the proceeds.

For the foregoing reasons, we reverse the trial court’s order. Because we find the district attorney’s release of the proceeds under N.C.G.S. § 15-11.1(a) to be controlling, we do not address the State’s remaining arguments.

Judge JOHNSON concurs. Judge EAGLES dissents with separate opinion.