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In re Property Seized From Herrera

Supreme Court of Iowa

May 25, 2018


         On review from the Iowa Court of Appeals.

          Appeal from the Iowa District Court for Pottawattamie County, Gregory W. Steensland, Judge.

         Driver and owner of vehicle in civil forfeiture proceeding seek further review of court of appeals decision affirming in part district court ruling rejecting driver's challenges to seizure of cash and denying owner's application for attorney's fees.

          Dean Stowers of Stowers & Sarcone PLC, West Des Moines, for appellants.

          Thomas J. Miller, Attorney General, Bridget A. Chambers, Assistant Attorney General, Matt Wilber, County Attorney, and Shelly Sudmann, Assistant County Attorney, for appellee.

          WATERMAN, Justice.

         This appeal from civil forfeiture proceedings presents several issues: (1) whether invoking the Fifth Amendment privilege against self-incrimination excuses compliance with statutory pleading requirements for establishing ownership in cash seized by the State, including identifying the source of the funds, (2) whether the district court must decide motions to suppress evidence before adjudicating forfeiture claims, and (3) whether a claimant is entitled to attorney fees as a prevailing party under the forfeiture statute when the State ultimately consented to the return of his or her property without an adjudication on the merits.

         The claimants' property was seized after a drug interdiction traffic stop on Interstate 80. No criminal charges were filed, but the State sought forfeiture of the impounded vehicle and $44, 990 discovered in a hidden compartment after issuance of a search warrant. Claimants' pleadings seeking return of the cash and vehicle omitted information required by Iowa Code section 809A.13(4)(d) (2015) but raised constitutional objections to the validity of the search and the statute's disclosure requirements. The district court dismissed the driver's claims for noncompliance with the statute's pleading requirements, and the State consented to return of the vehicle to the owner after months of contested litigation. The district court denied the owner's claim for attorney fees, and both claimants appealed. We transferred the case to the court of appeals, which affirmed the district court in part but remanded for a determination on whether probable cause supported the forfeiture. We granted the claimants' application for further review.

         For the reasons explained below, we hold that assertion of the Fifth Amendment privilege against self-incrimination excuses compliance with forfeiture threshold pleading requirements in Iowa Code section 809A.13(4)(d), such as identifying the source of cash. We conclude the district court erred by failing to rule on the claimants' motions to suppress evidence before adjudicating the forfeiture claims and erred by overruling Fifth Amendment objections to the pleading requirements. We further hold the vehicle owner was a prevailing party entitled to recover his reasonable attorney fees under the forfeiture statute notwithstanding the lack of an adjudication on the merits. We remand the case with instructions.

         I. Background Facts and Proceedings.

         On September 12, 2015, Sergeant Kevin Killpack, a motor vehicle enforcement officer with the Iowa Department of Transportation (IDOT), was driving east on Interstate 80 when he noticed a westbound 1999 Ford Expedition with New York license plates. He had been trained that this particular year, make, and model was commonly used for transporting narcotics and currency. Sergeant Killpack changed directions and caught up with the Expedition, which he paced at seventy-four miles per hour in a seventy mile-per-hour zone. He pulled the vehicle over for speeding.

         As Sergeant Killpack walked up to the Expedition, he knelt by the rear wheel well and looked underneath using his flashlight. He found a fabricated compartment attached below the rear cargo area. While the rest of the undercarriage was rusty, this aftermarket alteration looked new. Sergeant Killpack asked for registration, insurance, and the driver's licenses of the driver, Jean Carlos Herrera, and the passenger, Bryan Riccaldo. Sergeant Killpack asked Herrera to accompany him to his patrol car, and Herrera complied. Sergeant Killpack noted that neither Herrera nor Riccaldo was the registered owner of the Expedition.

         When he asked Herrera who owned it, Herrera said it was a friend of his family but he only knew the owner's first name, Fernando.

         Further inquiries raised discrepancies in the stories offered by the Expedition's driver and passenger. Herrera told Sergeant Killpack that he and Riccaldo were traveling from New York to Los Angeles to attend a trade show to promote their screen printing business. Herrera said that he had been in business with Riccaldo for two years, yet he was unable to name the business. Herrera claimed that the trade show, called "Agenda, " started in two weeks, but Sergeant Killpack performed a Google search without finding that trade show. He so informed Herrera, who began to search for the event through his smartphone. Herrera then changed his story, claiming that the trade show was called "The Venue" and would take place a month later.

         Sergeant Killpack spoke with Riccaldo separately. He asked Riccaldo if the men were going to a trade show; Riccaldo said no. Instead, Riccaldo said they were traveling to Los Angeles to visit family and to deliver the ice cream machine to a man named "Bogar."

         Sergeant Killpack issued Herrera a warning for speeding and explained that he was free to leave once the citation was printed. But as Herrera opened the door to get out of the police car, Sergeant Killpack asked if he could ask Herrera more questions. Herrera said yes. Sergeant Killpack explained that the two men had given different stories about their trip and that he was concerned that they were involved in transporting narcotics. Sergeant Killpack asked Herrera to consent to a search of the vehicle for narcotics and large sums of money; Herrera refused. Sergeant Killpack explained that he felt he had enough reasonable articulable suspicion to perform a "K-9 free air sniff." The trained police dog was already at the scene and alerted to the odor of narcotics. Sergeant Killpack and two Pottawattamie County deputies searched the Expedition. Before the search, Herrera claimed $2000 in cash in the center console. The currency was held together with multiple rubber bands. Riccaldo claimed $800 cash in his own front pants pocket. This cash was also held together with rubber bands.

         Sergeant Killpack inspected the ice cream machine. He noted the electrical cord had been cut off; the internal components of the ice cream machine had been removed leaving an empty, opaque storage area. The officers found a "boost phone"-a mobile phone with only one number programmed into it-as well as a vacuum pump, a rivet gun and rivets, and a battery for a cordless drill. These tools could have been used to install the hidden compartment mounted on the undercarriage. And they found a "Pelican case" that contained drug paraphernalia and remnants of marijuana. Herrera admitted to smoking marijuana the day they left New York. Sergeant Killpack pulled the carpet back in the cargo area and found the access hole to the aftermarket compartment he had seen earlier. This compartment was empty.

         The Expedition was towed to the IDOT maintenance garage in Council Bluffs for further examination. The officers transported Herrera and Riccaldo there. Captain Tom Bruun assisted Sergeant Killpack in a further search of the vehicle, but they did not find any narcotics or money. Sergeant Killpack told Herrera that the police were going to seize the vehicle and the items found therein. He gave Herrera an evidence receipt and a notice of forfeiture. Herrera and Riccaldo called a cab to take them to the Omaha airport. They were allowed to depart with the cash they were claiming.

         Fernando Rodriguez of New York is the registered owner of the Expedition. After his vehicle was seized, Rodriguez obtained counsel to reclaim the vehicle. On September 18, Rodriguez's attorney emailed the county attorney to let the State know that "the owner has an innocent owner position and will be entitled to attorney fees should he prevail in that position." The attorney noted that the attorney fees are provided by statute and concluded that "the fees are going to be greater than the vehicle value, so this might be one to let go."

         After learning of this email, Sergeant Killpack applied for and obtained a search warrant. In his application, Sergeant Killpack stated that he "ran a Kelly Blue Book valuation on th[e] vehicle and found that in its current condition [it] would be worth $2, 132 for resale." The application continued,

If a person looked at this situation in a cost benefit analysis it does not make financial sense to spend a significant amount of money, in attorney fees, in an attempt to reclaim a vehicle worth $2, 132. The attorney fees would well surpass the value of the vehicle very quickly. Through my training an[d] experience a person willing to spend a significant amount of money to get their low value vehicle back knows that there is something much more valuable still inside the vehicle that has not been found by law enforcement in the initial search.
I spoke to Captain Bruun, researched additional concealment locations in this type of vehicle, and we discussed all the areas that we searched. After our conversation we came to the conclusion that we missed three areas that are known concealment areas within a motor vehicle of this year, make and model. Those areas are the spare tire, the firewall and the underneath side of the center consul [sic]. It is my belief that these three areas contain either narcotics and or a large sum of U.S. currency gained from narcotics trafficking. The unfound, high value, commodities would completely justify the significant cost and effort to get a low value vehicle returned.

         The application for the search warrant failed to mention that Rodriguez had argued he was entitled to attorney fees from the State as an innocent owner. The district court issued the search warrant. During the second search of the vehicle, Sergeant Killpack found $44, 990 hidden in a false compartment inside the center console.

         The State filed an in rem forfeiture complaint on October 1, seeking to forfeit the "1999 Ford Expedition, soft serve ice cream machine, pelican case, cordless drill and battery, vacuum pump and United States Currency." The State alleged the property was forfeitable as "drug proceeds" or property "used in the transport of drugs." In their combined answer filed on November 5, Herrera and Rodriguez stated,

1. I, Fernando Rodriguez, am the owner of the 1999 Ford Expedition identified in the complaint as being subject to forfeiture and an interest holder in the property seized therefrom, including the U.S. Currency in the vehicle.
2. I, Jean Carlos Herrera, was in lawful possession of the 1999 Ford Expedition, soft serve ice cream machine, pelican case, cordless drill and battery, vacuum pump and U.S. Currency identified in the complaint as being subject to forfeiture and have a legal ownership and possessory interest in those items.
3. We would ask that all mail in this matter be sent to our attorney . . . .
4. With this answer we are also filing a motion asserting that the vehicle stop, the subsequent detention and seizure, and the search of that vehicle, violated the prohibition against unreasonable searches and seizures found in the Fourth Amendment to the United States Constitution and the corresponding provision of the Iowa Constitution.
5. The exclusionary rule under the Fourth Amendment and Iowa Constitution applies in forfeiture proceedings. See In the Matter of Property Seized from Sharon Kay Flowers, 474 N.W.2d 546 (Iowa 1991).
6. By virtue of the application of the exclusionary rule, further statements concerning the vehicle and its contents would constitute derivative evidence also subject to the exclusionary rule. Consequently, until there is a determination on the motion to suppress, we object to providing further information for the reason that such further information would be the product of the original search and seizure that we believe violated . . . constitutional rights.
7. We request that the vehicle and its contents be returned to Jean Carlos Herrera and Fernando Rodriguez, since it belongs to them.

         While the answer concluded, "We certify under penalty of perjury and pursuant to the laws off the State of Iowa that the preceding is true and correct, " only Herrera signed the answer. Rodriguez did not.

         Two weeks later, Herrera filed a motion to suppress the evidence and return the property. He argued that the stop of the vehicle and the subsequent detention, search, and seizure were conducted in violation of the Fourth Amendment and article I, section 8 of the Iowa Constitution. Herrera later filed a supplemental motion to suppress, claiming that the second search of the vehicle was unconstitutional because the warrant application was defective and probable cause was based solely on Rodriguez obtaining counsel to reclaim the vehicle.

         On December 10, the court held a hearing on Herrera's motion to suppress. The State began by arguing that the motion to suppress should not proceed because the claimant had not complied with the statutory requirements for filing an answer to the forfeiture proceeding. Specifically, the State pointed out that the claimant did not state "the nature and extent of the claimant's interest in the property" or "the date, the identity of the transferor, and the circumstances of the claimant's acquisition of the interest in the property."

         The attorney for Rodriguez and Herrera responded that the answer was sufficient until the motion to suppress was decided. He acknowledged that if the motion was denied, his clients "could be required at that point to come back in and amend their claim and their answer." But the attorney reiterated his position that it was "not appropriate to require detailed disclosures when there's a Fourth Amendment issue that has to be taken up first." The court took the matter under advisement and gave the parties the opportunity to submit briefs. The court heard Sergeant Killpack's testimony.

         That same day, Rodriguez filed a claim for return of the vehicle. He argued that the vehicle did not meet the definition of property subject to forfeiture under Iowa Code section 809A.4 and that the vehicle was exempt from forfeiture under section 809A.5.

         Herrera and the State submitted briefs before the court issued its order on February 9, 2016. The district court determined that because Herrera had not met the procedural requirements of section 809A.13(4), he was not entitled to a forfeiture hearing. The court concluded that the property claimed to be owned by Herrera was forfeited to the State. Additionally, the court denied Herrera's motion to suppress, finding the issue moot because Herrera had not filed a proper answer and therefore had no standing to challenge the forfeiture. Herrera timely appealed.

         In its February 9 order, the district court did not decide Rodriguez's claim for the return of his vehicle because the matter had not been set for hearing. The order provided that Rodriguez's claim should be scheduled for a hearing. Shortly thereafter, Rodriguez filed a motion to suppress.

         On February 23, the court found "there is no objection by the state to claimant Fernando Rodriguez's claim for return of property, specifically his 1999 Ford Expedition." The court granted Rodriguez's claim and canceled the hearing on the matter. Rodriguez then moved for attorney fees and expenses in the amount of $8956.96 under Iowa Code section 809A.12(7), contending he was a prevailing party within the meaning of the statute. Dean Stowers, the attorney for both Rodriguez and Herrera, submitted an attorney fee affidavit in which he clarified that the attorney fees for representation of both clients totaled $8232.30 and the expenses totaled $724.66. He concluded,

The work on this case would have been nearly the same had I only represented Mr. Rodriguez because the suppression issues were all part of the same overall factual scenario and legal backdrop. I believe the total fees are reasonable given all the issues at ...

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