Cunningham v. Dept. of Saftey ( 1997 )

IN THE COURT OF APPEALS OF TENNESSEE
MIDDLE SECTION AT NASHVILLE
FILED
May 21, 1997
WAYNE ARLE CUNNINGHAM, )
Cecil W. Crowson
) Appellate Court Clerk
Plaintiff/Appellant, )
) Davidson Chancery
) No. 94-1805-I
VS. )
) Appeal No.
) 01A01-9509-CH-00411
DEPARTMENT OF SAFETY, )
STATE OF TENNESSEE, )
)
Defendant/Appellee. )
APPEAL FROM THE CHANCERY COURT FOR DAVIDSON COUNTY
AT NASHVILLE, TENNESSEE
THE HONORABLE IRVIN H. KILCREASE, JR., CHANCELLOR
For the Plaintiff/Appellant: For the Defendant/Appellee:
Mr. Howard B. Barnwell, Jr. Charles H. Burson
Chattanooga, Tennessee Attorney General and Reporter
Rebecca Lyford
Assistant Attorney General
REVERSED AND REMANDED
WILLIAM C. KOCH, JR., JUDGE
OPINION
This appeal involves a father’s efforts to regain possession of his 1986
Corvette that was seized incident to his son’s arrest for selling marijuana to an
undercover officer. The Commissioner of Safety, overruling an administrative
law judge’s decision to return the automobile, determined that the father and the
son co-owned the Corvette and ordered its forfeiture subject to the father’s and a
secured creditor’s interests. The Chancery Court for Davidson County affirmed
the forfeiture order, and the father appealed to this court. We have determined
that the record does not contain substantial and material evidence supporting the
Commissioner’s conclusion that the son was the co-owner of his father’s Corvette.
Accordingly, we reverse the forfeiture order.
I.
Wayne Arle Cunningham operates a video machine business in Rhea
County. In late 1992, he decided to buy a 1986 Corvette he found at a local car
lot because he had always wanted one. Mr. Cunningham purchased the Corvette
in mid-November 1992 using money borrowed from the First Bank of Rhea
County. The title certificate identified Mr. Cunningham as the registered owner
and the First Bank of Rhea County as the first lienholder. Only Mr. Cunningham
and his wife were listed as covered drivers on the insurance policy covering the
Corvette.
Wayne Alan Cunningham was Mr. Cunningham’s only child. Mr.
Cunningham provided most of his son’s support even though his son was twenty
years old, married, and the father of two children. Mr. Cunningham owned the
house where his son lived and employed him part-time to make deliveries and to
run errands. Even though Alan Cunningham owned his own automobile, Mr.
Cunningham gave him a set of keys to the Corvette and permitted him to drive it
whenever he wished. Mr. Cunningham kept the Corvette at his house and paid for
its maintenance. When Alan suggested installing a new stereo system in the
Corvette, Mr. Cunningham bought the components for his son to install.
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On May 16, 1993, Alan Cunningham sold 6.5 grams of marijuana to an
undercover officer of the Rhea County Sheriff’s Department. According to the
undercover officer, the sale took place in the Corvette. The officer stated that he
had been in the Corvette on several times and that he observed Alan Cunningham
driving the automobile on numerous occasions.
On August 4, 1993, Mr. Cunningham asked his son to have the Corvette’s
oil changed. Alan Cunningham picked up the car at his father’s house and was
driving it to be serviced when the law enforcement authorities seized the
automobile on the grounds that it had been used to facilitate the May 16, 1993
drug transaction. When Mr. Cunningham learned of the seizure, he inquired
“What am I going to have to do to get my car back?” The authorities informed
him that he would have to “go to court.”
Mr. Cunningham and First Bank of Rhea County filed timely claims for the
Corvette with the Department of Safety. On February 8, 1994, an administrative
law judge filed an initial order finding that Mr. Cunningham owned the Corvette
and that he did not know about or consent to the use of his car to facilitate the sale
of illegal drugs. Accordingly, the administrative law judge directed the
Department to return the Corvette to Mr. Cunningham. The State appealed the
initial order, and on May 13, 1994, the Commissioner of Safety entered a final
order forfeiting the Corvette. The Commissioner concluded that Mr. Cunningham
and his son were “co-owners” of the Corvette and that the forfeiture would be
subject to Mr. Cunningham’s fifty percent ownership interest and First Bank of
Rhea County’s lien. Mr. Cunningham sought judicial review of the
Commissioner’s order, and the Chancery Court for Davidson County affirmed the
forfeiture on the ground that the record contained substantial and material
evidence supporting the Commissioner’s finding that Mr. Cunningham and his
son were “co-owners” of the Corvette.
II.
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Mr. Cunningham takes issue on this appeal with the evidentiary support for
the Commissioner’s conclusion that Alan Cunningham was a “co-owner” of the
Corvette. In order to resolve this question, we must consider not only the type of
proof required to establish ownership but also the parties’ respective burdens of
proof or of going forward with the evidence.
A.
Forfeiture proceedings such as those permitted by the Tennessee Drug
Control Act are drastic, extraordinary remedies. The courts construe forfeiture
statutes strictly, Redd v. Tennessee Dep’t of Safety, 895 S.W.2d 332, 335 (Tenn.
1995); Hays v. Montague, 860 S.W.2d 403, 406 (Tenn. Ct. App. 1993), and
accordingly forfeitures must fall within the letter and spirit of the law in order to
be upheld. Biggs v. State, 207 Tenn. 603, 608, 341 S.W.2d 737, 740 (1960);
Blackmon v. Norris, 775 S.W.2d 367, 369 (Tenn. Ct. App. 1989).
The State has the initial and ultimate burden of proving that seized property
was used or intended to be used to facilitate a violation of the drug laws. See
Tenn. Code Ann. §§ 53-11-201(d)(2), -451(a)(4) (Supp. 1996).1 If the State
presents a prima facie case for forfeiture, the burden of going forward with the
evidence shifts to the claimant to prove either that the property is not subject to
forfeiture or that he or she has a good faith interest in the property and that he or
she did not know or have reason to know that the property was being used to
facilitate a violation of the drug laws. See Tenn. Code Ann. § 53-11-201(f)(1);
Lewis L. Laska & Brian K. Holmgreen, Forfeitures Under the Tennessee Drug
Control Act, 16 Mem. St. U.L. Rev. 431, 490 (1986) (“Laska & Holmgreen”). If
the claimant presents prima facie evidence that the property should not be
forfeited, then the burden of going forward with the evidence shifts back to the
State to rebut the claimant’s evidence. If the State does not rebut the claimant’s
evidence, the property cannot be forfeited and must be returned. Tenn. Code Ann.
§§ 53-11-201(d)(2), -201(e)(1); Laska & Holmgreen, 16 Mem. St. U.L. Rev. at
490.
1
The forfeiture procedures changed after the forfeiture in this case. Effective on January
1, 1997, forfeitures of conveyances seized under the Drug Control Act are governed by Tenn.
Code Ann. §§ 40-33-101 through 40-33-214 (Supp. 1996) rather than by the statutory provisions
discussed in this opinion.
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B.
“Ownership” is a purely legal concept. 3 Roscoe Pound, Jurisprudence 129
(1959). It connotes a “bundle of rights” with regard to the property. Woods v. M.
J. Kelley Co., 592 S.W.2d 567, 570 (Tenn. 1980); Ray A. Brown, The Law of
Personal Property § 1.5, at 6 (3d ed. 1975). Included in the bundle of rights are
(1) the right of possession, enjoyment, and use, (2) the unrestricted right of
alienation, and (3) the power of testimonial disposition. State ex rel. Elvis Presley
Int’l Mem’l Found. v. Crowell, 733 S.W.2d 89, 96-97 (Tenn. Ct. App. 1987).
Proof of ownership generally involves evidence with regard to possession
and exercise of one or more of the prerogatives in the bundle of ownership rights.
Thus, ownership is a question for the trier of fact to determine from the evidence.
In order to determine ownership of a vehicle, triers of fact may consider and
weigh evidence relating to (1) the circumstances surrounding the vehicle’s
purchase,2 (2) the registration of the vehicle,3 (3) all aspects of insuring the
vehicle,4 (4) all parties’ financial stake in the vehicle, (5) the actual possession of
the vehicle, (6) the responsibility for bearing the expense of operating,
maintaining, and licensing the vehicle,5 and (7) the ultimate right to control the
vehicle and to make major decisions concerning the vehicle such as its use and
restrictions on its use or the sale or other disposition of the vehicle.
2
See Polland v. Safeco Ins. Co., 52 Tenn. App. 583, 588, 376 S.W.2d 730, 732 (1963);
Laska & Holmgreen, 16 Mem. St. U.L. Rev. at 492.
3
The fact that a vehicle is registered in a particular person’s name is not conclusive
evidence of ownership. Smith v. Smith, 650 S.W.2d 54, 56 (Tenn. Ct. App. 1983); Polland v.
Safeco Ins. Co., 52 Tenn. App. at 588, 376 S.W.2d at 732. Courts understand that registration
can be used as a subterfuge by persons engaging in “forfeiture planning.” Felder v. State, 515
So. 2d 17, 18-19 (Ala. Civ. App. 1997); Kam Seafood Co. v. State, 496 So. 2d 219, 219 (Fla.
Dist. Ct. App. 1986); People v. 1991 Chevrolet Camero, 620 N.E.2d 563, 568 (Il. App. Ct.
1993); Strand v. Chester Police Dep’t, 687 A.2d 872, 877 (Pa. Commw. Ct. 1997). Nonetheless,
courts consider nonsuspicious record title as a material factor in cases of this sort. State v. 1977
Pontiac, 294 S.E.2d 660, 661 (Ga. Ct. App. 1982).
4
United States v. One 1986 Chevrolet Monte Carlo, 817 F. Supp. 729, 732 (N.D. Ill.
1993); State v. One (1) Ford, Econoline, 381 A.2d 387, 390 (N.J. Super. Ct. App. Div. 1977).
5
State v. One (1) Ford, Econoline, 381 A.2d at 390.
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C.
The State made out a prima facie case that the Corvette was subject to
forfeiture under the Tennessee Drug Control Act by presenting uncontradicted
proof that Alan Cunningham conducted an illegal drug transaction in the
automobile. Accordingly, the burden of going forward with the evidence shifted
to Mr. Cunningham to establish that he was the innocent owner of the Corvette
and that he did not know, and had no reason to know, that his son was using the
automobile to facilitate an illegal drug transaction.
There is no suggestion in the proof that Mr. Cunningham acquired title to
the Corvette as a subterfuge to circumvent the forfeiture statutes or that he had any
knowledge or reason to believe that his son was using the Corvette to sell
marijuana. Accordingly, the fate of Mr. Cunningham’s claim rested on his ability
to establish that he was the Corvette’s owner. To support his claim, Mr.
Cunningham proved that he paid for the automobile, that he registered the
automobile in his name only, that he insured the automobile, and that he was
solely responsible for the maintenance and upkeep of the automobile. He also
proved that the Corvette was kept at his house, that he used the Corvette whenever
he wished, and that he controlled the use of the Corvette by others.
Mr. Cunningham’s evidence was sufficient to establish his claim to the
Corvette. Accordingly, the burden of going forward with the evidence shifted
back to the State to prove that Mr. Cunningham was not the sole owner of the
automobile. To carry this burden, the State pointed out that Mr. Cunningham
consulted his son when he purchased the Corvette, that Mr. Cunningham gave his
son a set of keys to the Corvette and permitted him to use it at will, and that Alan
Cunningham played a role in adding after-market accessories to the automobile.
The privilege of using property is only one of many attributes of ownership.
As the State points out in its brief, an equally, if not more, significant factor in
establishing ownership is who exercises ultimate control over the property.
Farley v. Commissioner, App. No. 01A01-9201-CH-00004, 1992 WL 151446, at
*2 (Tenn. Ct. App. July 2, 1992) (No Tenn. R. App. P. 11 application filed). This
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record contains no evidence that Mr. Cunningham turned over the ultimate control
of the Corvette to his son. To the contrary, the record contains substantial and
material evidence that Mr. Cunningham determined who used the automobile,
when and where it would be serviced, and whether after-market accessories would
be installed in the car.
The strongest evidence in the State’s favor is Alan Cunningham’s liberal
use of the Corvette. He had his own set of keys and apparently used the Corvette
at will. Accordingly, the State argues that the “vehicle was as much for [Alan
Cunningham’s] use as his father’s.” Perhaps so. This court, however, is
unprepared to hold that a person using property with another’s permission
acquires some sort of ownership interest in the property. We know of no legal
precedent for such an extreme conclusion, and the Commissioner has cited none.
Accordingly, we find that this record does not contain substantial and material
evidence supporting the Commissioner’s conclusion that Alan Cunningham was
the “co-owner” of his father’s Corvette.
III.
The State also asserts that the evidence supports the conclusion that Mr.
Cunningham in essence gave his son an interest in the Corvette. In order to
constitute an inter vivos gift, the donor must intend to make a gift, must deliver
the property to the donee, and must relinquish to the donee all rights to control the
property. Lowry v. Lowry, 541 S.W.2d 128, 130 (Tenn. 1976); Arnoult v. Griffin,
490 S.W.2d 701, 710 (Tenn. Ct. App. 1972). The donor cannot retain or reserve
any interest in or right to the property or to its control. Pamplin v. Satterfield, 196
Tenn. 297, 301, 265 S.W.2d 886, 888 (1954); Laman v. Craig, 30 Tenn. App. 353,
362, 206 S.W.2d 309, 313 (1947).
The State presented no evidence that Mr. Cunningham has relinquished or
intended to relinquish control over his Corvette. The undisputed evidence is, in
fact, to the contrary. On the very day that the law enforcement officers seized the
Corvette, Mr. Cunningham had directed his son to pick up that automobile and to
have its oil changed. Thus, right up to the time of the seizure, the Corvette was
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being garaged at Mr. Cunningham’s house, and Mr. Cunningham exercised
control over its use. Accordingly, the State failed to prove by substantial and
material evidence that Mr. Cunningham had effectively given his son any interest
in the Corvette.
IV.
We reverse the trial court’s decision affirming the Commissioner’s
conclusion in the forfeiture order that Alan Cunningham was a “co-owner” of the
1986 Corvette. We remand the case to the trial court for the entry of an order
remanding the case to the commissioner with directions to return the Corvette to
Mr. Cunningham subject to the interests of the First Bank of Rhea County.6 We
also tax the costs of this appeal to the State of Tennessee.
____________________________
WILLIAM C. KOCH, JR., JUDGE
CONCUR:
________________________________
HENRY F. TODD, P.J., M.S.
________________________________
BEN H. CANTRELL, JUDGE
6
The record does not reveal whether the Corvette has been sold. If it has not been sold,
it should be returned to Mr. Cunningham. If it has been sold, the proceeds should first be used
to satisfy the bank’s lien, and the remainder should be paid over to Mr. Cunningham.
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