UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
decided: April 12, 1972.
HAROLD MCCLENDON ET AL., PLAINTIFFS-APPELLANTS,
THOMAS E. ROSETTI, INDIVIDUALLY AND AS POLICE PROPERTY CLERK OF THE CITY OF NEW YORK, DEFENDANT-APPELLEE
Anderson, Oakes and Timbers, Circuit Judges.
OAKES, Circuit Judge.
This case was briefed and argued primarily on the question whether there was jurisdiction under the Civil Rights Act, 28 U.S.C. § 1343(3) and 42 U.S.C. § 1983, in view of the fact that plaintiffs-appellants were primarily seeking to protect rights to their property. Since the Supreme Court had noted probable jurisdiction in three cases*fn1 dealing with the issue and at least one of them, Lynch v. Household Finance Corp., was argued on December 7, 1971, we have withheld decision herein pending word from above. Now that the High Court has held unequivocally that rights in property are basic civil rights within § 1343(3),*fn2 Lynch v. Household Finance Corp., 405 U.S. 538, 92 S. Ct. 1113, 31 L. Ed. 2d 424 (1972), the issue has been laid finally to rest.*fn3 We thus pass to the merits of appellants' claims.
Six individual plaintiffs, with two proposed intervenors, here seek to overturn as lacking in due process the New York City ordinance*fn4 which establishes the office of Police Property Clerk and gives it certain powers, claimed to be arbitrary, over the handling and disposition of property (1) taken from arrested persons or prisoners, (2) suspected of being the proceeds of crime or used unlawfully, (3) required as evidence in any criminal action or proceeding, or (4) which is contraband. The district court dismissed the suit on its own motion for lack of subject matter jurisdiction in reliance upon Eisen v. Eastman, 421 F.2d 560 (2d Cir. 1969), cert. denied, 400 U.S. 841, 91 S. Ct. 82, 27 L. Ed. 2d 75 (1970), which is now no longer applicable in the light of Lynch.
Each of the individual plaintiffs except Jean and Thomas Camera had property taken from him at the time of his arrest; the Cameras had a car taken at the time of the arrest of a family member. The property, consisting of autos, cash and sundry items, was delivered to defendant Rosetti, the Police Property Clerk of New York, by the arresting officer or in one case by the Department of Corrections. Criminal proceedings have been terminated in each case either by dismissal or conviction of a crime unrelated to the property. The District Attorney has in each case furnished a release certifying that the property is not needed as evidence in any case and that his office has no objection to its return. Each plaintiff has made a timely demand on the defendant for the return of his property but has been advised by defendant's office that a civil suit must be instituted. The defendant makes no claim to ownership of the property -- none of which is contraband -- and in only one case, that of plaintiff Fisher, is there a third party claimant to the property.
It is conceded that the property of plaintiff Alloggiamento was seized without probable cause. It is also conceded that plaintiff Flythe was unable to maintain the payments on his car to the finance company because without it his earnings were diminished, and that his inability to make the payments commenced after he brought civil proceedings in the New York courts against the defendant.
The City claims in its brief that if a claimant shows proof of ownership and possession after a car has been released by the District Attorney "the Property Clerk will frequently return the automobile" if satisfied that the claimant had no knowledge it was used as a means of or in furtherance of a crime. This, however, did not help plaintiffs Camera whose relative was convicted in September 1970 of the crime -- for which he paid a $10 fine -- of being an unlicensed driver of the car which the defendant has had in his possession since July 15, 1970, the date on which a police officer allegedly saw a passenger throw a quarter-ounce of marijuana from the car.
Plaintiffs McClendon and Fisher claim that the defendant's refusal to return their property prevented them from posting bail and securing attorneys of their choice, but defendant points out that there was no release of the property as evidence obtained from the District Attorney until after these plaintiffs had served a prison term. The defendant concedes, however, that the proposed intervenors, who are presently incarcerated on felony charges but who have obtained District Attorney's releases with respect to the property they claim, are disqualified from bringing suit against defendant in the state courts by New York Civil Rights Law § 79 (McKinney Supp. Consol.Laws c. 6 1969). Indeed, proposed intervenor Colligan apparently in October 1963 commenced a suit which was dismissed on that ground, and his appeals have been of no avail.*fn5 As a matter of law, it is not disputed that the section of the ordinance [§ 435-4.0(c)] giving a magistrate (now called a judge) authority to direct the return of the property is not a meaningful remedy, since almost no criminal court judge (or justice in the criminal term of the New York Supreme Court) will order such return. Proposed intervenor Lowery's effort to obtain such an order was unsuccessful. Nor is it disputed that the defendant ordinarily requests 60 additional days to answer a summons and complaint in the civil courts against him to recover the property and also requests a jury trial, which results in months' delay, with the result that some persons lose their property to finance companies or lose hope and abandon their suits altogether.
Finally, plaintiffs assert that under the ordinance the defendant may dispose of detained property without notice to any claimant and that the proceeds of such disposition are paid into the police pension fund. On argument, however, defendant stated that these payments do not increase the size of the pension fund but merely reduce the City's contribution to it.*fn6
On the merits of the issue of due process, the City has not briefed, and has not seriously urged before us, the argument that the ordinance meets minimal due process requirements. It could hardly do so on the record, with all parties (and intervenors) deprived of the use of their property, some without any notice whatsoever (plaintiff Oliver and proposed intervenor Colligan, whose property was disposed of while he was awaiting trial on the charges for which he was arrested) and without any meaningful requirement of notice in the ordinance.*fn7
Beyond the question of notice, however, the ordinance is fatally deficient in other terms of due process. The burden of proof in any civil action is expressly put upon the claimant "from whose possession such property or money was taken or obtained, or any other claimant" to "establish that he has a lawful title or property right in such property or money and lawfully obtained possession thereof and that such property or money was held and used in a lawful manner." New York, N.Y. Administrative Code § 435-4.0(f) (Supp.1971). As the section has been construed by the New York courts, the burden exists even if there is insufficient evidence for an indictment. Angrisani v. Rosetti, 36 Misc.2d 523, 233 N.Y.S.2d 351 (Civ.Ct., Bronx County 1962). It exists even after acquittal or dismissal. Weiss v. Rosetti, 23 A.D.2d 655, 257 N.Y.S.2d 519 (1st Dept. 1965); Rivera v. Rosetti, 38 Misc.2d 1030, 239 N.Y.S.2d 691 (Civ.Ct., N.Y.County 1963); Roxy Athletic Club, Inc. v. Simmons, 80 N.Y.S.2d 277 (App.Term, 1st Dept. 1944), reversing 44 N.Y.S.2d 47 (City Ct., N.Y.County 1943). It seems plain enough that absent evidence of unlawful conduct, criminal sanctions may not be imposed, Taylor v. Louisiana, 370 U.S. 154, 82 S. Ct. 1188, 8 L. Ed. 2d 395 (1962); Thompson v. Louisville, 362 U.S. 199, 80 S. Ct. 624, 4 L. Ed. 2d 654 (1960), nor property forfeited, United States v. One 1936 Model Ford etc. Coach, 307 U.S. 219, 59 S. Ct. 861, 83 L. Ed. 1249 (1939), even though in the case of property forfeiture the burden of proof on the government seeking it is only by a preponderance of the evidence. Utley Wholesale Co. v. United States, 308 F.2d 157, 159 (5th Cir. 1962); D'Agostino v. United States, 261 F.2d 154, 157 (9th Cir. 1958), cert. denied, 359 U.S. 953, 79 S. Ct. 739, 3 L. Ed. 2d 760 (1959).
Consequently we are dealing here with procedures of "an importance fully as great as the validity of the substantive rule of law to be applied," see Speiser v. Randall, 357 U.S. 513, 520-521, 78 S. Ct. 1332, 1339, 2 L. Ed. 2d 1460 (1958) -- a rule of procedure that affects -- or here in fact, infects -- the substantive outcome. Cf. Note, The Growth of Procedural Due Process into a New Substance: An Expanding Protection for Personal Liberty and a "Specialized Type of Property . . . in Our Economic System," 66 Nw.U.L.Rev. 502 (1971); see also Sniadach v. Family Finance Corp., 395 U.S. 337, 89 S. Ct. 1820, 23 L. Ed. 2d 349 (1969). The defendant's own brief, in describing the operation of the ordinance, indicates the substantial degree of governmental arbitrariness which property owners must confront and suggests per se a lack of due process:
As a matter of practice, a registered owner, other than a defendant, of a car seized in connection with an arrest fills out a form provided by the Property Clerk (A219-A220). If the claimant shows proof of ownership and lawful possession, and the District Attorney has released the car as evidence, the Property Clerk will frequently return the automobile if he is satisfied that the claimant had no knowledge it was used as a means of or in furtherance of crime (A220) (emphasis supplied).
Not unexpectedly, the challenged procedures of the Police Property Clerk, resting as they do on the sections of the Code fixing the burden of proof, have been condemned by some of the state courts as involving "insolence of office," Marshall v. Kennedy, 17 Misc.2d 985, 988, 181 N.Y.S.2d 413 (Sup.Ct.1959); as being "shocking," Gonzalez v. Leuci, note 4 supra ; and, more moderately, as involving "a studied indifference to the rights of the public." Country-Wide Insurance Co. v. Rosetti, N.Y.L.J., July 17, 1970, at 8, col. 6 (Civ.Ct., N.Y. City 1970). We concur.
Thus we hold § 435-4.0 of the New York City Administrative Code unconstitutional as applied to persons from whose possession money or property, other than contraband, has been taken or obtained, though such money or property was not related to any criminal proceeding, or, if it was so related, such criminal proceedings had been terminated, or if the money or property had been needed as evidence in a criminal proceeding, it was no longer needed for that purpose, as violative of the due process clauses of the fifth and fourteenth amendments. We remand to the court below, with direction to permit intervention and to establish an appropriate class, for a determination of the respective rights of the parties in accordance herewith and for the purposes of formulating any necessary injunctive relief to avoid further perpetuation of the practices and procedures hereby declared unconstitutional.