Opinion
Court of Appeals No. A-10962 Trial Court No. 3AN-10-1773 Cr No. 5812
03-07-2012
Appearances: Kevin T. Fitzgerald, Ingaldson, Maassen, & Fitzgerald, P.C., Anchorage, for the Appellant. Andrew Peterson, Assistant Attorney General, Office of Special Prosecutions and Appeals, Anchorage, and John J. Burns, Attorney General, Juneau, for the Appellee.
NOTICE
Memorandum decisions of this court do not create legal precedent. See Alaska Appellate Rule 214(d) and Paragraph 7 of the Guidelines for Publication of Court of Appeals Decisions (Court of Appeals Order No. 3). Accordingly, this memorandum decision may not be cited as binding authority for any proposition of law.
MEMORANDUM OPINION
Appeal from the District Court, Third Judicial District, Anchorage, Catherine M. Easter, Judge.
Appearances: Kevin T. Fitzgerald, Ingaldson, Maassen, & Fitzgerald, P.C., Anchorage, for the Appellant. Andrew Peterson, Assistant Attorney General, Office of Special Prosecutions and Appeals, Anchorage, and John J. Burns, Attorney General, Juneau, for the Appellee.
Before: Coats, Chief Judge, and Mannheimer and Bolger, Judges.
MANNHEIMER, Judge.
Kurt Lepping was convicted of twenty-three guiding-related violations of the Alaska game laws. As a result, the district court ordered the forfeiture of two airplanes owned by Lepping.
Lepping's mother, Lola Bodé, claimed a security interest in one of these airplanes (a 2002 Piper Super Cub), and Bodé asked the district court to partially remit the forfeiture of the Super Cub, to the extent of this security interest.
In State v. Rice, 626 P.2d 104, 113 (Alaska 1981), the Alaska Supreme Court held that when property is forfeited to the state as a result of criminal activity, innocent third parties (i.e., owners and security holders) have a constitutional right to seek remission of the forfeiture to the extent of their monetary interest in the property. Invoking Rice, Bodé argued that she was an innocent third party, and that she was therefore entitled to remission of the forfeiture of the Super Cub to the extent of her security interest in the airplane.
District Court Judge Catherine M. Easter held an evidentiary hearing to investigate this matter. At the conclusion of the hearing, Judge Easter found that Bodé was not an innocent security holder. Specifically, Judge Easter found that Bodé was aware, when she took the security interest in the airplane, that her son had previously been convicted of violating federal game laws, and that her son would be using the airplane for his guiding business. Here is the conclusion of the judge's ruling:
The Court: Ms. Bodé knew ... the risk involved [in] securing an interest in [her son's] plane, and [she] consciously disregarded the risk. The Court understands [that] Ms. Bodé is [Mr.] Lepping's mother, and sometimes parents like to think the best of their children. But the law cannot protect individuals or parents who choose to [turn] a blind eye when it comes to their children. Ms. Bodé would like to paint herself as an innocent, non-negligent creditor by wearing blinders. [But] Ms. Bodé knew the risk involved, [and] she chose to ignore it. I find her actions to be reckless. And [because of this,] I find that Ms. Bodé has not met her burden of proving by a preponderance of the evidence that she is an innocent, non-negligent owner or creditor.
[Accordingly,] she is not entitled to remission of the forfeited plane.
Bodé now appeals the district court's ruling on two grounds.
First, Bodé challenges the district court's findings of fact — in particular, the court's findings that Bodé knew about her son's prior violations of the game laws, that Bodé knew her son would be using the plane in his guiding business, and that Bodé was aware of, and consciously disregarded, the risk that her son might use the airplane for illegal purposes. We acknowledge that these matters were vigorously contested at the evidentiary hearing. But we have examined the record, and we conclude that Judge Easter's findings on these matters are not clearly erroneous.
Second, Bodé challenges the legal standard that Judge Easter applied when she denied Bodé's request for remission of the forfeiture. In particular, Bodé argues that even if she did know about her son's prior violations of the federal game laws, this knowledge should not automatically disqualify Bodé from being considered an innocent security holder. The true issue, Bodé contends, is not whether she was aware of her son's prior convictions, but instead whether she had reason to believe that her son would re-offend, and reason to believe that he would use the airplane when he re-offended.
This argument is inconsistent with prior case law on this point. Both the supreme court's decision in State v. Rice and this Court's decision in Baum v. State, 24 P.3d 577 (Alaska App. 2001), declare that a property owner or security holder will not qualify as an innocent third party if the owner or security holder is aware that the user of the property has a history of violating the law in ways that might lead to forfeiture of the property.
In State v. Rice, our supreme court stated that an owner or security holder would be entitled to remission of a forfeiture if they could show "that prior to parting with the property[, they] did not know, nor have reasonable cause to believe, either that the property would be used to violate the law, or that the violator had a criminal record or a reputation for commercial crime[.]" 626 P.2d at 114 (quoting 19 C.F.R. §171.13(a)) (emphasis added). See also footnote 38 of the Rice opinion, 626 P.2d at 115, where the supreme court stated that "[i]f Cessna [Finance Corporation] had no knowledge that Rice was a violator of the game laws[,] and was not negligent in its inquiry, [then Cessna] is entitled to remission." And in Baum v. State, 24 P.3d at 581, this Court explicitly relied on the foregoing italicized portion of the Rice opinion as our basis for upholding the trial court's refusal to remit the forfeiture of an airplane.
For these reasons, we reject Bodé's contention that Judge Easter applied the wrong legal standard when she ruled on Bodé's request for a remission of the forfeiture.
The judgement of the district court is AFFIRMED.