II. Background

A. In Rem Nature of the Civil Forfeiture Action

A forfeiture is "the divestiture without compensation of property used in a manner contrary to the laws of the sovereign." [FN18] It is based on the legal fiction that the property at issue is "liable" for some wrong. [FN19]

Historically, liable property has been classified as "guilty," "hostile," or "indebted" property, depending on the manner by which the property becomes liable. [FN20] "Guilty" property is that which is utilized in an act that contravenes the law, "hostile" property is that which "is owned or controlled by an enemy of war," [FN21] and "indebted" property is that which is designated as collateral for a defaulted debt. [FN22] This Article concerns the forfeiture of property connected with illegal activity and, thus, which traditionally would be considered guilty property.

Forfeiture proceedings are proceedings in rem because they are solely concerned with the liability of the property, rather than with the innocence or whereabouts of the owner. [FN23] Such proceedings do not render the property guilty, hostile, or indebted. Rather, the property is rendered guilty, hostile, or indebted by virtue of the acts performed with it, at the time the acts are committed. Thus, in forfeiture proceedings, the government merely seeks to declare that it has a preexisting right in the guilty property. The function of forfeiture is to acknowledge officially, through the grant of title, *1615 that preexisting property right. [FN24]

Under traditional in rem principles, the government's title to guilty property was deemed to "relate back" to the date that the act which rendered the property guilty was committed. [FN25] Therefore, under traditional principles, no intermediate transfers of guilty property could be valid as against the government. At times a harsh principle in practice, the relation-back doctrine has been partially rejected by current civil forfeiture law. [FN26] At present, intermediate transfers of guilty property to innocent persons can defeat the government's preexisting right to the property. [FN27]

The legal fiction of personalizing property for purposes of forfeiture is justified by the fact that it enables the government to enforce its laws and prevent the continued illicit use of property without having to ascertain the identity of the owner or bring the owner himself into the jurisdiction of a particular court. The ability to do so is crucial because the government cannot always reach the owners of property, either because they are outside of a particular jurisdiction or because their identity is simply unknown. Thus, it would be extremely burdensome for the government to have to bring an in personam suit against every person who has an interest in a particular item of property in order to remove that property from circulation. Additionally, in rem forfeiture provides a method to achieve finality in the adjudication of the title to property. By providing an adjudication paradigm that is property-centered, in rem forfeiture ensures that property owners are not able to challenge the status of forfeitable property on a piece-meal basis. [FN28]

*1616 In rem proceedings and, in particular, the civil forfeiture proceedings that are provided by modern civil forfeiture statutes, put such concerns to rest. Modern forfeiture statutes allow the government to proceed against guilty property, while requiring that public or direct notice be given of the government's intent to seek the forfeiture of such property. [FN29] Such notice requirements enable persons who claim interests in the property at issue to defend their interests against the government action. [FN30] Thus, modern in rem proceedings strike a balance between the government's right to enforce its laws and owners' rights to protect their interests in items that have been used or obtained in violation of the law.

B. History of the Civil Forfeiture Action

The use of civil forfeiture dates back to biblical times. [FN31] At common law, government use of civil forfeiture was also widespread. [FN32]

The common law recognized three distinct bases for forfeiture: deodand, conviction for felony or treason, and statutory grounds. [FN33] The common law theory of "deodand," which rested on the Latin phrase "deo dandum" or "to be given to God," was often used by the English Crown to recover the value of an object that caused a man's death. [FN34] While the initial proffered purpose behind deodand *1617 forfeiture was the facilitation of the "expiation" of property, by medieval times, deodand was recognized as a valid method of revenue exaction by the Crown. [FN35] As the religious rationale behind deodand gave way to the more mundane purpose of revenue-raising, deodand came to be seen as punishment of the owner of property for his negligence in causing or failing to prevent injury to another man. [FN36]

The use of forfeiture at common law was also justified as punishment of persons who were convicted of felonies or treason. [FN37] However, the common law not only required the forfeiture of the property connected with the crime for which the owner was convicted, but all of the owner's other real and personal property as well. [FN38]

Lastly, the common law provided a statutory basis for forfeiture for any violations of the English admiralty, customs, and revenue laws. [FN39] In such cases, the scope of a forfeiture was controlled by the applicable statute, which commonly required the forfeiture of contraband, as well as any instrumentalities in which the contraband was carried. [FN40] As a result of the "merger of the deodand tradition and the belief that the right to own property could be denied the wrongdoer," statutory forfeiture was considered punitive in nature. [FN41]

Although colonial America rejected the theories of forfeiture based on deodand and felony or treason convictions, it adopted the common law theory of statutory forfeiture. [FN42] The first forfeiture *1618 acts enacted by the United States Congress authorized the forfeiture of cargo and vessels for violations of the nation's customs laws. [FN43] Numerous additional forfeiture statutes were enacted thereafter. [FN44]

In 1970, Congress enacted the Drug Control Act. [FN45] Like its precursors, the Drug Control Act allows the forfeiture of property without regard to the innocence of the owner. [FN46] The Drug Control Act is one of the broadest forfeiture statutes known to American law. [FN47] In addition to providing a statutory basis for forfeitures in a vast number of areas, [FN48] the Drug Control Act allows for the forfeiture of drug-related "contraband," such as controlled substances,*1619 as well as "derivative" contraband or "instrumentalities," such as property that is used in the manufacture, storage, transportation, or sale of controlled substances. [FN49] Moreover, as a result of Congressional amendments in 1978 and 1986, respectively, the Drug Control Act provides for the forfeiture of "direct proceeds" from drug activity, [FN50] as well as "derivative proceeds" from such drug activity, including any personal or real property that is acquired or maintained with direct proceeds. [FN51] Thus, the Drug Control Act provides the government with expansive forfeiture powers to fight the illegal drug trade. [FN52]

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[FN18]. United States v. Eight (8) Rhodesian Stone Statues, 449 F.Supp. 193, 195 n.1 (C.D. Cal. 1978).

[FN19]. See Matthew P. Harrington, Rethinking in Rem: The Supreme Court's New (and Misguided) Approach to Civil Forfeiture, 12 Yale L. & Pol'y Rev. 281, 285 (1994).

[FN20]. Id.

[FN21]. Id.

[FN22]. Id.

[FN23]. Accordingly, jurisdiction rests on the court's power to reach the property, not the owner. See The Palmyra, 25 U.S. (12 Wheat.) 114 (1827).

[FN24]. See Gelston v. Hoyt, 16 U.S. (3 Wheat.) 318 (1818); Caldwell v. United States, 49 U.S. (8 How.) 366, 381 (1850). Thus, forfeiture proceedings are analogous to proceedings to quiet title to property, in that both proceedings merely seek judicial recognition of a preexisting right.

[FN25]. See generally Comment, Tempering the Relation-Back Doctrine: A More Reasonable Approach to Civil Forfeiture in Drug Cases, 76 Va. L. Rev. 165, 175-77 (1990); see also 21 U.S.C.A. s 881(h) (West 1995) (codifying the relation-back doctrine).

[FN26]. See infra note 80 and accompanying text.

[FN27]. See infra note 80 and accompanying text.

[FN28]. Civil forfeiture proceedings are supposed to quiet title to the property as against the entire world. See The Palmyra, 25 U.S. (12 Wheat.) at 114-15.

[FN29]. See infra notes 70-71 and accompanying text.

[FN30]. See infra notes 70-71 and accompanying text.

[FN31]. Virtually all commentators trace forfeiture to the biblical excerpt "when an ox gores a man that he [shall] die, the ox shall be stoned and its flesh shall not be eaten." Exodus 21:29. See, e.g., George C. Pratt & William B. Petersen, Civil Forfeiture in the Second Circuit, 65 St. John's L. Rev. 653, 654 (1991). The excerpt stood for the proposition that individuals must not receive a benefit from an offending, guilty animal. Id. Presumably, the illegal obtainment or use of property renders the property "guilty," like the Ox's flesh, and thus, no benefits may be derived from it.

[FN32]. Austin, 113 S. Ct. at 2806-07.

[FN33]. Id.

[FN34]. See Jacob J. Finkelstein, The Goring Ox: Some Historical Perspectives on Deodand, Forfeitures, Wrongful Death and the Western Notion of Sovereignty, 46 Temp. L.Q. 169, 185 (1973). Curiously, the offending object itself was not forfeited to the English Crown. Rather, the King assessed the value of such an object, which value was then owed to the Crown as the forfeiture. Id.

[FN35]. Id. at 183.

[FN36]. Austin, 113 S. Ct. at 2806.

[FN37]. Id. at 2806-07.

[FN38]. Id. "These forfeitures ... were justified on the ground that property was a right derived from society which one lost by violating society's laws." Id. at 2807.

[FN39]. Id.

[FN40]. Id.

[FN41]. Id.

[FN42]. The Austin Court noted:

Deodands did not become part of the common-law tradition of this country.... The Constitution forbids forfeiture of estate as a punishment for treason ... and the First Congress also abolished forfeiture of estate as a punishment for felons .... But '[l]ong before the adoption of the Constitution the common law courts in the Colonies - and later in the states during the period of Confederation - were exercising jurisdiction in rem in the enforcement of [English and local] forfeiture statutes.'

Id. (citing Calero-Toledo v. Pearson Yacht Leasing Co., 416 U.S. 663, 682 (1974) (quoting C.J. Hendry Co. v. Moore, 318 U.S. 133, 139 (1943)).

[FN43]. See Calero-Toledo, 416 U.S. at 683 n.21-22. Historians believe that the British practice of seizing cargo and vessels for violations of the customs laws was one of the factors that led to the American revolution. See United States v. 92 Buena Vista Ave., 113 S. Ct. 1126, 1131-32 (1993). Curiously, however, the First United States Congress replicated the British practice.

[FN44]. For example, in 1890, Congress enacted the Customs Administrative Act, which allowed, inter alia, the forfeiture of property for failure to declare it upon entry into the country. Act of June 10, 1890, ch. 407, s 6, 26 Stat. 131, 134.

[FN45]. Pub. L. No. 91-513, s 511, 84 Stat. 1236, 1276-78 (1970) (codified as amended at 21 U.S.C.A. s 881 (West 1981 & Supp. 1995)).

[FN46]. See, e.g., In re Four Packages Cut Diamonds, 255 F. 314, 317 (2d Cir. 1918), modified, 256 F. 305 (2d Cir. 1919). In this sense, civil forfeiture proceedings constitute a form of strict liability.

[FN47]. While the Drug Control Act was initially intended to regulate narcotics trafficking, it now provides a statutory basis for the forfeiture of property that is connected with other crimes, including gambling, motor vehicle theft, and counterfeiting. See, e.g., Pub. L. No. 102-519, s 104(a), 106 Stat. 3385 (codified as amended at 18 U.S.C.A. s 981(a)(1)(F) (West Supp. 1995)) (providing for the forfeiture of property traceable to motor vehicle theft).

[FN48]. See supra note 47.

[FN49]. See 21 U.S.C. s 881(a)(1)-(3) (West 1981 & Supp. 1995).

[FN50]. See id. s 881(a)(6).

[FN51]. See id. s 881(a)(7).

[FN52]. The legislature enacted the Drug Control Act in an effort to eliminate the high profit margins associated with drug trafficking. See H.R. Rep. No. 1444, 91st Cong., 1st Sess. (1970), reprinted in 1970 U.S.C.C.A.N. 4566, 4567; H.R. Rep. No. 1030, 98th Cong., 2d Sess. 4 (1984), reprinted in 1984 U.S.C.C.A.N. 3182, 3374; see also Calero-Toledo v. Pearson Yacht Leasing, 416 U.S. 663 (1974) (discussing the legislative history of the Drug Control Act); United States v. One 1972 Datsun, 378 F. Supp. 1200 (D. N.H. 1974).