Opinion
No. 13853.
May 18, 1938.
J. Charles Dennis, U.S. Atty., and G.D. Hile, Asst. U.S. Atty., both of Seattle, Wash., for the United States.
Ryan, Askren Ryan, of Seattle, Wash., for libelee.
Libel by the United States of America, libelant, against One Ford V-8 Truck, 1934 Model, Motor Number 1008663, and tools and accessories, seized from E.R. Robertson, libelee, wherein C.B. Ballard Son, Inc., and E.R. Robertson filed petitions for dismissal.
Mitigation denied.
Information in due form against the Ford Truck in issue, etc., alleging that said truck was duly seized together with a complete distillery, which distillery was not authorized by law and said truck had been used in connection with said distillery with intent to defraud the United States of the tax on the spirits distilled by E.R. Robertson in whose possession the said property was, and forfeiture prayed.
C.B. Ballard Son, Inc., alleging corporate entity, say that on and prior to the 7th day of April, 1936, it was the owner of the truck described in the libel and seized as charged; that it had sold said truck to E.R. Robertson on conditional sale contract; that neither it or any of its officers had any knowledge or reason to believe that said truck was being used, or would be used, in violation of the laws of the United States; that Robertson does not have a record or reputation of violating the laws of the United States and prays dismissal.
Robertson alleges that on the 7th day of April, 1936, he purchased the said truck from C.B. Ballard Son, Inc.; that said truck has not been used in violation of the laws of the United States, etc.; that if said truck has been used in the violation of the laws of the United States it was used by a person, or persons, unknown to Robertson and prays dismissal and other equitable relief.
At trial it was stipulated that said truck may be forfeited "or in lieu thereof the bond posted herein by C.B. Ballard Son, Inc.," and that a decree forfeiting said truck be entered, provided, however, that said forfeiture shall not operate to prejudice the rights of the parties to be heard on claimants' petition to remit forfeiture; that claimant C.B. Ballard Son, Inc., is a corporate entity under the laws of the State of Washington; has paid all licenses, fees, and dues, etc.; that the reasonable appraised value of said truck is $490.00; that on Nov. 4th, 1936, Ballard Son, Inc., obtained delivery of said truck and posted a bond conditioned as provided by 27 U.S.C.A. § 40a; that said truck has not been, and will not be, returned to libelant at any time; that on April 7th, 1936, Ballard Son, Inc., as seller, and claimant E.R. Robertson, as buyer, entered into a conditional sales contract for said truck; that on Nov. 4th, 1936, and prior Ballard Son, Inc., had an interest as conditional sales seller which was acquired in good faith; that prior to Nov. 4th, 1936, the remaining interest in said truck was vested in E.R. Robertson who acquired the interest in good faith; that neither at any time had any knowledge, or reason to believe, that said truck was being, or would be used, in violation of the laws of the United States, nor have either any record or reputation of violating the laws of the United States. That subsequent to C.B. Ballard Son, Inc., taking delivery of said truck they delivered the same to E.R. Robertson; that Robertson, being unable to make the payments under the sales contract, delivered said truck to Robert Horr, who made the payments under the said conditional sales contract to Ballard Son, Inc., in the name of Robertson; Horr paid all sums remaining due on the conditional sales contract to Ballard Son, Inc.; that said contract was fully paid on October 16th, 1937; that on Nov. 26th, 1937, Horr sold said truck to Guy Thompson Motor Co. in conjunction thereof Robertson assigned the certificate of title to said truck to said Guy Thompson Motor Co.; that the Guy Thompson Motor Co. is now the sole and lawful owner of said truck and no other person has any interest therein; that since Oct. 16th 1937, the claimant C.B. Ballard Son, Inc., has not had, and does not now at the time of trial have, right, title, interest or claim in and to said truck. That on said Oct. 16th, 1937, the claimant Robertson has not had and does not now have (time of trial) any right, title, lien, interest or claim in or to said truck.
The right to remission or mitigation is governed by 27 U.S.C.A. § 40a (b). Subdivision (b) provides, "conditions precedent to remission or mitigation. In any such proceeding the court shall not allow the claim of any claimant for remission or mitigation unless and until he proves (1) that he has an interest in such vehicle * * * as owner or otherwise, which he acquired in good faith * * *". (Italics supplied.)
On failure to produce the vehicle the court at trial entered a decree of forfeiture of the bond pursuant to subdivision (d), § 40a, supra, and the bond thereupon became functus officio. There is no provision for relief from the decree of forfeiture. Relief from any decree may be had only by procedure provided by the Congress under section 40a, supra, which provides not remission or mitigation from operation of the decree of forfeiture of the bond, but only if claimant proves it has an interest in the vehicle which he acquired in good faith. The forfeiture is clearly a proceeding in rem. Coffey v. U.S., 116 U.S. 427, 6 S.Ct. 432, 29 L.Ed. 681. See, also, Hammel v. Little, 66 App.D.C. 356, 87 F.2d 907, at page 911. The truck offended and no one not having an interest in the vehicle may seek mitigation or remission. The privilege given by subdivision (b), § 40a, supra, is analogous to the rights in rem proceeding in admiralty and interest in the thing must be shown, The Cartona, 2 Cir., 297 F. 827. A stipulator has no right in admiralty to intervene, The Lydia, 2 Cir., 1 F.2d 18, and by the same token the claimants here are without right. The interest must be in the vehicle. The R.W. Skillinger, D.C., 21 Fed.Cas. p. 102, No. 12,181; The Henry Ewbank, C.C.Mass., 11 Fed. Cas. p. 1166, No. 6,376, opinion by Judge Story; The Revenue Cutter No. 1, D.C., 20 Fed.Cas. p. 560, No. 11,713.
The cases cited by claimants are not in point. U.S. v. Sylvester, D.C., 273 F. 253; U.S. v. Ryan, 284 U.S. 167, 52 S.Ct. 65, 76 L.Ed. 224; Wilson Motor Co. v. U.S., 9 Cir., 84 F.2d 630; C.I.T. Corporation v. U.S., 4 Cir., 89 F.2d 977.
The statute is liberally construed, only when a claimant comes within its provision. De Gooyer v. Northwest Trust State Bank, 130 Wn. 652, 228 P. 835, affirmed on rehearing en banc. 132 Wn. 699, 232 P. 695. Nor have claimants shown any diligence in inquiring of the reputation or character of the purchaser of the car in whose possession it offended. U.S. v. One 1936 Studebaker Sedan, D.C., 21 F. Supp. 499. This memorandum will be considered the court's findings of fact and conclusions of law.
The petition for mitigation is denied.