Police Dept. of the City of New York v Burnett

[*1] Police Dept. of the City of New York v Burnett 2004 NY Slip Op 51962(U) Decided on July 19, 2004 Supreme Court, New York County Shulman, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on July 19, 2004
Supreme Court, New York County

Property Clerk of the Police Department of the City of New York, and the Police Department of the City of New York, Petitioners,

against

Hubert Burnett and the New York City Office of Administrative Trials and Hearings, Respondents.



04/400955



Michael A. Cardozo, Corporation Counsel, New York, NY for petitioners

The Legal Aid Society, New York, NY for respondents

Martin Shulman, J.

Petitioners, Property Clerk of the Police Department of the City of New York and the New York City Police Department ("petitioners", "NYPD" or "Property Clerk") commenced this Article 78 proceeding by order to show cause seeking to annul as arbitrary, capricious and contrary to law a Memorandum Decision issued March 11, 2004 ("OATH decision" as Exhibit 3 to Verified Petition) by respondent, New York City Office of Administrative Trials and Hearings ("OATH"), wherein an Administrative Law Judge directed the NYPD to return a motor vehicle the police seized from respondent, Hubert Burnett ("respondent" or "Burnett") as an instrumentality of a crime and which is being held for forfeiture pursuant to N.Y.C. Adm. Code §14-140.

Upon signing the order to show cause on March 25, 2004, this Court stayed the effect of the OATH decision pending the hearing. On the March 30th return date, this Court continued the stay pending its determination. At the same time, this Court granted the respective parties' oral application for more time to file additional papers as well as copies of briefs filed in a federal appeal perfected this year which will examine an issue not implicated in the OATH decision now under review (i.e., seizure of a vehicle as arrest evidence). [*2]

Parenthetically, this 2004 federal appeal involves the same parties who participated in an earlier, related appeal of a federal court determination, viz., Krimstock v. Kelly, 306 F.3d 40 (2nd Cir., 2002), cert. denied, 123 S. Ct. 2640 (2003) ("Krimstock" or "2nd Circuit Decision") (addressing an action and its resultant federal appellate decision ultimately controlling on the issues being raised in this Article 78 proceeding), which had initially granted the City of New York's motion to dismiss.

In reversing the district court, the 2nd Circuit Decision, inter alia, ruled that due process requires the NYPD to afford any defendant whose motor vehicle was seized at the time of arrest with the opportunity for a prompt, post-seizure hearing to determine the probable validity and justification for the pre-judgment retention of the vehicle, pendente lite.

The 2nd Circuit Decision

In conducting a de novo review of the district court's dismissal of the complaint (see, Fed. R. Civ. P. 12[b][6]), the 2nd Circuit Decision concisely framed the issue decided on appeal (306 F.3d at 48):

Our primary focus today is the City's continued retention of vehicles after their warrantless seizure by the police and prior to ultimate resolution of the forfeiture action in court. It is this intermediate deprivation, lasting months or sometimes years without a prompt hearing before a neutral fact-finder that we deem constitutionally infirm...

In resolving this issue, the 2nd Circuit Decision held that in "[b]alancing the Mathews factors,[FN1] . . . due process of law requires that all plaintiffs be afforded a prompt post-seizure, pre-judgment hearing . . . to determine whether the City is likely to succeed on the merits of the forfeiture action and whether means short of retention of the vehicle can satisfy the City's need to preserve the [seized property] from destruction or sale during the pendency of proceedings." (306 F.3d at 67). Significantly, the leit motif of Krimstock is the appellate court's recognition that due process affords a claimant a constitutional right to "be given an early opportunity to test the probable validity of the further deprivation, including probable cause for the initial seizure. . ." Id., at 68. Towards that end, Krimstock left it to "the district court, in consultation with the parties, to fashion appropriate procedural relief consistent with [the 2nd Circuit Decision]. . ." Id., at 69.

The Krimstock Hearing

On remand, the district court eventually issued an Amended Order and Judgment on January 22, 2004 (the "January 22nd Order" as Exhibit 2 to Verified Petition) which essentially incorporated the appellate court's holding and established [*3]the procedural and substantive parameters for a Krimstock Hearing. At ¶ 2 of the January 22nd Order, Chief Judge Mukasey ruled that an OATH judge at a Krimstock Hearing must decide three issues: "[1] whether probable cause existed for the arrest of the vehicle operator; [2] whether it is likely that the City will prevail in an action to forfeit the vehicle; and [3] whether it is necessary that the vehicle remain impounded in order to ensure its availability either as evidence or for a judgment of forfeiture." The January 22nd Order also ruled that the Property Clerk bears the burden of proof by a preponderance of the evidence as to all three issues.

The Underlying Arrest, OATH Trial and OATH Decision

On or about February 16, 2004, P.O. Eric Andreoli, NYPD Manhattan Gang Unit, arrested and charged respondent with felony possession of a controlled substance, Viagra, with intent to sell, felony possession of more than 16 ounces of marijuana (640 bags) and misdemeanor possession of marijuana in a public place. The police found these drugs in Burnett's motor vehicle, a 2000 Lexus, which was seized and vouchered (No.: B161371) the night of his arrest[FN2]. Notably, respondent was not charged with criminal sale of marijuana and/or a controlled substance.

In accordance with his due process rights, Burnett filed a demand with the Property Clerk for a post-seizure retention hearing and an OATH trial (i.e., Krimstock Hearing) was scheduled and conducted on March 8, 2004. Respondent appeared without counsel. Counsel for the Property Clerk's Office appeared with the NYPD arrest file on Burnett which contained a vehicle invoice, an arrest report, a criminal complaint, a N.A.D.A. report (valuation of the 2000 Lexus), respondent's rap sheet (showing prior arrests and convictions) and a DMV extract (proof Burnett is the titled owner of the vehicle).

As initially noted in the OATH decision's "Analysis," the Property Clerk met its burden of proof with respect to establishing the likelihood of the NYPD's success as a prevailing party in a civil forfeiture action and the necessity for the NYPD to retain the 2000 Lexus, pendente lite. Concerning the proof needed to show probable cause for Burnett's arrest, documentary evidence adduced at the OATH trial showed that the police found, inter alia, a substantial quantity of marijuana in the vehicle. But when Burnett, in unsworn, albeit uncontroverted, trial statements described his circumstances that evening prior to his arrest, he stated he was merely exiting his parked vehicle when the police rushed him (see, Krimstock Hearing Transcript at p.13, lines 1-15, annexed to OATH's Verified Answer). Against this evidentiary backdrop, without more, the OATH judge logically made the following observation: "The [NYPD] offered no evidence to show how the arresting officer came to know that the vehicle contained marijuana. That is, the record contains no indication of the factual basis for the suspicion, if any, that brought the arresting officer to stop, question or search the respondent." (OATH decision at p. 2, annexed as Exhibit 3 to Verified Petition).

Because the NYPD failed to establish how P.O. Andreoli lawfully came to learn [*4]of the vehicle's illegal contents, the OATH judge concluded that the Property Clerk failed to prove probable cause for Burnett's arrest based upon alleged untainted evidence that a crime had been committed and ordered the release of the vehicle. This Article 78 proceeding ensued.

Petitioners' Arguments

Petitioners essentially argue that the OATH judge's conclusion was arbitrary and capricious and unauthorized because the 2nd Circuit Decision did not require the NYPD to prove the legality of the initial stop of a moving vehicle or the approach of a parked vehicle, and the three-pronged test enumerated in the January 22nd Order did not expressly or implicitly include a fourth prong — reasonable suspicion for the approach to Burnett's vehicle. Because the Krimstock analysis expressly limited the NYPD's burden to prove probable cause for the initial warrantless arrest at a Krimstock Hearing, petitioners argue it was unreasonable for the OATH judge to conduct an ultra vires act to expand the NYPD's burden to require justification for the approach. Moreover, petitioners contend that the OATH judge disregarded Krimstock's admonition not to conduct a "de facto" suppression hearing, but rather a limited retention hearing ("[W]e do not envision the retention hearing as a forum for exhaustive evidentiary battles . . . due process should be satisfied by an initial testing of the merits of the City's case . . . [306 F.3d at 69-70])[FN3]. Finally, petitioners urge the court to reject respondent's notion that the OATH decision is not reviewable via an Article 78 proceeding.

Respondent's Arguments

In opposition to the Article 78 petition and the stay against the release of the vehicle, respondent raises the following points:

The correctness of a preliminary OATH decision may only be revisited in a civil forfeiture action, not in an Article 78 proceeding,[FN4] otherwise it would run afoul of [*5]Krimstock's mandate to ensure a prompt post-seizure hearing as to the validity of NYPD's seizure of the vehicle, the probability of the Property Clerk's success in the civil forfeiture action and the need for the continued retention of the vehicle, pendente lite.

Krimstock requires an inquiry as to probable cause for the arrest based on untainted evidence obtained without violating a party's Fourth Amendment rights (the exclusionary rule does apply to civil forfeiture proceedings [see, 306

F.3d at 49]).

An OATH judge's adverse ruling against the NYPD on the issue of whether there was probable cause for the arrest and seizure of the property as an instrumentality of a crime will never be given preclusive effect in an ensuing criminal action. In any event, "the parallel criminal process requires proof of conformity to the Fourth Amendment well before the OATH proceeding

convenes . . ." (Respondent's Memorandum of Law in Opposition to Article 78Petition at p. 15).

Discussion

Preliminarily, it must be noted that the January 22nd Order at ¶ 7 states, in relevant part: "[t]he decision of the OATH judge will be subject to review in New York State Supreme Court . . .". As petitioners' counsel correctly noted, "Article 78 proceedings are used to challenge action (or inaction) by agencies and officers of state and local government . .." (Alexander, 1994 Practice Commentaries, McKinney's Cons. Laws of NY, Book 7B, CPLR §7801, C7801:1 at 25). So, a party aggrieved by a decision of an administrative tribunal such as OATH[FN5] generally has legal recourse to seek judicial review of same by means of an Article 78 proceeding. Thus, the district court's use of the term "review" unambiguously supports this avenue of relief for any party adversely affected by a Krimstock Hearing ruling. Moreover, while a determination of an OATH judge seemingly is an interim order affecting the rights of the parties, pendente lite, it is still a final order issued by an administrative tribunal at the close of a Krimstock Hearing. And it is precisely the type of action which is properly the subject of judicial review pursuant to CPLR Article 78.

Additionally, this Court finds its consideration of the collateral estoppel issue (Footnote 3, supra) persuasive in mandating Article 78 review of an OATH decision.Petitioners, in their Memorandum of Law in Support of the Article 78 petition, vigorously argue that an Article 78 proceeding must lie to review an OATH decision; yet, casually, albeit inconsistently, dismiss the notion that an OATH decision has any [*6]preclusive effect in any forum (namely, the doctrine of collateral estoppel can never be implicated). Respondent apparently concurs on this latter point with respect to criminal actions.

In a separate vein and without any legal support, respondent glosses over the potentially preclusive effect an OATH decision could have in a subsequent civil forfeiture action, claiming each party's alleged right to have a de novo determination, inter alia, on the central issue previously determined at a Krimstock Hearing, viz., probable cause for the arrest and initial seizure of the vehicle.

However, regardless of their respective positions on this issue, petitioners and respondent overlook the potential collateral estoppel effect on the central issue of probable cause for the arrest and initial seizure. Indubitably, a de novo determination of whether a crime has been committed that warrants forfeiture of seized property will generally occur in a civil forfeiture action after, and regardless of, the disposition of the underlying criminal action. N.Y.C. Adm. Code §14-140 (the City of New York's forfeiture statute) expressly mandates that "an independent determination must be made in this civil [forfeiture] proceeding based on a preponderance of the evidence, as to whether the seized property is subject to forfeiture in accordance with the provisions of the civil forfeiture statute . . ." Property Clerk of the New York City Police Department v. Conca, 148 AD2d 301, 538 N.Y.S.2d 268, 269 (1st Dept., 1989).

But, the circumstances underlying the Krimstock Hearing are factually and legally distinguishable from a civil forfeiture action initiated concurrently with, or subsequent to, a criminal action. In a criminal action, the Property Clerk is neither a party thereto nor a legal representative with any official role or participation in the underlying prosecution. It is the District Attorney's Office which appears on behalf of the People with the requisite burden to prove the commission of a crime beyond a reasonable doubt. Here, the Property Clerk and Burnett were participants at the Krimstock Hearing before an administrative tribunal and will inevitably share actual identity as parties to a civil forfeiture action initiated pursuant to N.Y.C. Adm. Code §14-140. And unlike the criminal action, the Property Clerk will have the same burden of proving by a preponderance of the credible evidence whether there was probable cause to arrest Burnett and seize his vehicle as part of its prima facie case to obtain forfeiture of the 2000 Lexus; the identical issue and burden of proof the Property Clerk had to address and bear at the Krimstock Hearing. Cf., In the Matter of Juan C. v. Cortines, 89 NY2d 659, 657 N.Y.S.2d 581 (1997).

Putting the issue of Article 78 review aside for the moment, Burnett and other claimants similarly situated, based upon the manner in which the three-pronged issues were litigated and decided before the OATH judge at the Krimstock Hearing, could conceivably have the right to plead collateral estoppel as a defense to defeat the civil forfeiture action. This would virtually eliminate the Property Clerk's chances of success. This is so because the issue of probable cause for the arrest and initial seizure of property has to be necessarily decided in the underlying OATH trial regardless of its characterization as a "limited retention hearing" and should be decisive in a civil forfeiture action. Kaufman v. Lilly & Co., 65 NY2d 449, 455, 492 N.Y.S.2d 584, 588 (1985).

Of course for respondent to succeed with this defense, he will have the "burden [*7]of demonstrating the identity of issues in the [subsequent civil forfeiture action and the prior determination (i.e., OATH decision)], whereas the party attempting to defeat its application has the burden of establishing the absence of a full and fair opportunity to litigate the issue in the [OATH trial] . . . [bracketed matter added]" 65 NY2d at 456, 492 N.Y.S.2d at 588. See also, Ryan v. New York Telephone Company, 62 NY2d 494, 478 N.Y.S.2d 823 (1984).

Here, the Property Clerk has had a full and fair opportunity to litigate the issue of probable cause for the arrest. After the OATH judge inquired if there were any applications, counsel for the Property Clerk expressly chose not to make any application for a continuance to presumably bring in P.O. Andreoli on the adjourned date to appear and testify as to what triggered his reasonable suspicion to approach Burnett as he was exiting his parked vehicle (see, Krimstock Hearing transcript at p. 12 [annexed to Verified Answer] and OATH decision at p.5, n.1 [annexed as Exhibit 3 to Verified Petition] [OATH rules of practice are lenient with respect to applications for continuances]).

Before being legally saddled with the preclusive effect of a potential issue-determination, fundamental fairness and due process surely underscore the Property Clerk's right to seek judicial review and the same right to an Article 78 review would apply with equal force to a respondent adversely affected by a Krimstock Hearing ruling as to any of the three issues which must necessarily be decided therein.[FN6]

The standard of review in an Article 78 proceeding is whether an administrative tribunal's determination was arbitrary, capricious or an abuse of discretion, was made in violation of a lawful procedure and/or was affected by an error of law. CPLR §7803 (3). See also, New York City Health & Hospitals Corp. v McBarnette, 84 NY2d 194, 203, n. 2 (1994); Matter of Scherbyn v Wayne-Finger Lakes Bd. of Coop. Educ. Servs., 77 NY2d 753, 757-758 (1991). When there is a rational basis for the exercise of discretion by the administrative agency, a court must affirm its determination. Matter of Pell v Bd. of Education, 34 NY2d 222, 231 (1974).After careful review of the Krimstock Hearing transcript (annexed to Verified Answer) and documentary evidence, this Court concludes that the OATH decision was neither arbitrary and capricious nor contrary to law. Moreover, the OATH Judge's well reasoned analysis reflects a fair interpretation of Krimstock and the prescriptive provisions contained in the subsequent January 22nd Order.

When addressing the issue of whether the January 22nd Order, incorporating the Krimstock holding, solely required the Property Clerk to prove probable cause for an arrest and not reasonable suspicion to stop a perpetrator and search the vehicle prior to an arrest, as Petitioners argue here, the OATH decision astutely noted (at p. 3, [*8]annexed as Exhibit 3 to Verified Petition ) that the first framed issue (viz., probable cause for the arrest of the vehicle operator [emphasis added]) pre-supposes that a Krimstock Hearing will usually involve a vehicle seized when its driver is being arrested for operating same in violation of law such as driving while intoxicated ("DWI") (see, VTL §1192, et seq.). Indeed, the class of plaintiffs conspicuously featured in the 2nd Circuit Decision were DWI criminal defendants and/or innocent owners of seized vehicles. Yet, it can never be successfully argued that the seizure of a vehicle as an instrumentality of a crime pursuant to N.Y.C. Adm. Code §14-140, can only lawfully occur when a crime has been committed during the "operation" of the vehicle. Thus, this Court concurs with the OATH decision's conclusion that a judge's "hands should not be tied" by the literal language of these framed issues when addressing a claimant's due process concerns.

Moreover, the OATH judge's inquiry as to the justification for the NYPD's approach to respondent's vehicle appears to be consistent with Krimstock's analysis of the Fourth Amendment's role in civil forfeiture cases:

We recognize that the likelihood of illegal seizure is reduced in the context of DWI arrests[FN7] and that the City's burden in such cases is not onerous. We cannot agree . . . however, that a warrantless arrest is sufficient by itself to ensure the legality of the initial seizure. Some risk of erroneous seizure exists in all cases . . . and in the absence of prompt review by a neutral fact-finder, we are left with grave Fourth Amendment concerns as to the adequacy of the inquiry into probable cause. . .Our concerns are heightened by the fact that the seizing authority in this case " has a direct pecuniary interest in the outcome of the proceeding (emphasis added)." 306 F.3d at 50-51.

To allay these concerns, the 2nd Circuit decision ultimately concluded that "at a minimum, the hearing must enable claimants to test the probable validity of continueddeprivation of their vehicles, including the City's probable cause for the initial warrantless seizure. In the absence of either probable cause for the seizure or post-seizure evidence supporting the probable validity of continued deprivation, owner's vehicle would have to be released . . . (emphasis added)." Id., at 69.

In this context, it is well settled that the exclusionary rule is implicated in quasi-criminal actions, civil in form, seeking retention of seized property. See, Leogrande v. State Liquor Authority, 25 AD2d 225, 268 N.Y.S.2d 433 (1st Dept., 1966); Herndon v. Ithaca, 43 AD2d 634, 349 N.Y.S.2d 227 (3rd Dept., 1973) citing to One 1958 Plymouth Sedan v. Pennsylvania, 380 U.S. 693, 85 S. Ct. 1246 (1965) ("the constitutional [*9]exclusionary rule applies to forfeiture proceedings").

Relying on the foregoing Krimstock analysis, the OATH judge reasoned that "[i]f the initial stop is invalid under fourth amendment principles, then the subsequent arrest is also invalid in any practical sense, regardless of the quality of the evidence that the illegal stop search produced. However sound the arrest might have been on the evidence found, the arrest is still illegal if that evidence was illegally found..." (OATH decision at p. 4).

In determining whether there was probable cause to arrest Burnett, the OATH Judge presumably took "judicial notice" of the recent decision of the Court of Appeals in County of Nassau v. Canavan, 1 NY3d 134,143, 770 N.Y.S.2d 277, 285 (2003)

( " [t]he question before us is the legality of the seizure, not the strength of the Government's case' [emphasis added]" quoting United States v. James Daniel Good Real Property, 510 U.S. 43, 62, 114 S. Ct. 492, 509 [1993]). Justification for the approach is clearly subsumed under the rubric of probable cause for the warrantless arrest and seizure. Thus, this Court finds that the OATH judge's conclusions are rationally based and consistent with the ratio decidendi of Krimstock.

Finally, because the Property Clerk advised that it was not seeking to retain the vehicle as arrest evidence but was proceeding solely on the basis of forfeiture, the OATH judge never had to resolve the question of whether the January 22nd Order created "an insoluble paradox in cases of vehicles seized solely as arrest evidence . . ." (OATH decision at p. 3, annexed as Exhibit 3 to Verified Petition). In any event, the Second Circuit Court of Appeals will be deciding the "arrest evidence" issue imminently.

Accordingly, the Article 78 petition is hereby denied and the stay enjoining the release of the motor vehicle is hereby vacated. The Property Clerk's Office is directed to release the 2000 Lexus to respondent within ten (10) days after issuance of this decision and order. This constitutes the decision and order of this Court. Courtesy copies of this decision and order have been mailed to counsel for the parties.

Dated: New York New York

July 19, 2004

______________________________

HON. MARTIN SHULMAN, J.S.C. Footnotes

Footnote 1: Krimstock applied the three distinct factors the U.S. Supreme Court enunciated in Mathews v. Eldridge, 424 U.S. 319, 96 S. Ct. 893 (1976) which must be necessarily considered to satisfy a claimant's due process rights vis a vis property seized and held for potential forfeiture under applicable federal and/or state law (viz., " [1] the private interest affected; [2] the risk of erroneous deprivation through the procedures used and the value of other safeguards; and [3] the government's interest." 306 F.3d at 60).

Footnote 2: A motor vehicle implicated in the alleged commission of a crime is routinely seized by the NYPD as "an instrumentality of a crime" and held for potential forfeiture. See, N.Y.C. Adm. Code §14-140.

Footnote 3: During oral argument on the return date of petitioners' Order to Show Cause to stay the affect of the OATH decision, Property Clerk's counsel expressed concerns that a fuller Fourth Amendment inquiry as to the probable cause for the arrest and seizure of the vehicle would compromise the ensuing criminal action through potential collateral estoppel consequences. This Court similarly commented as to the OATH's decision's possible impact in a civil forfeiture action since a Krimstock Hearing and a civil forfeiture action will invariably share the same parties, the same issues and the same burden of proof, namely, a preponderance of the credible evidence (see discussion, infra).

Footnote 4: Subsequent to the issuance of the 2nd Circuit Decision, respective counsel for the petitioners and the Krimstock class of plaintiffs proffered written proposals for the district court's consideration in establishing the procedural process leading up to a Krimstock Hearing and its scope of inquiry. Respondent's counsel contends that in the January 22nd Order, Chief Judge Mukasey rejected petitioners' suggested language in the proposed district court order for Article 78 review of an OATH decision and merely allowed same to be reviewed in a State court by either party seeking interim relief from this preliminary determination in a civil forfeiture action (Respondent's Memorandum of Law in Opposition to Article 78 Petition at p. 6).

Footnote 5: As more fully described in its mission statement, OATH, as a City Charter agency since 1988, functions as a "central tribunal with the authority to conduct administrative hearings for any agency, board or commission of the [C]ity [of New York]... [and was set up] to function as an independent agency of government so that its judges would not be unduly influenced by the prosecutor or petitioning agency." (see, OATH's website at www.ci.nyc,ny.us/html/oath/home).

Footnote 6: There are circumstances where the collateral estoppel doctrine should not be rigidly applied even if the formal prerequisites have been met (see, Jeffreys v. Griffin, 1 NY2d 34, 769 N.Y.S.2d 184 [2003]) (N.Y.S. Dept. of Health's revocation of a physician's license based on his criminal conviction for sexually assaulting a patient was not given collateral estoppel effect in the victim's civil action for assault and battery when the physician was subsequently re-tried and acquitted of the criminal charges.). Those circumstances are not present here.

Footnote 7: The 2nd Circuit Decision noted that in a DWI case, the risk of an improper seizure and impoundment of the vehicle is minimized "because a trained police officer's assessment of the owner-driver's state of intoxication can typically be expected to be accurate . . ." 306 F.3d at 62. Put differently, the manner in which the vehicle was operated and other objective criteria will, in most instances, justify the stop, arrest and seizure of the vehicle. In this case, however, there was no information in the OATH trial record to explain the basis for the police approaching respondent as he exited his vehicle.