Sugalski v. Cochran

529 A.2d 1104, 365 Pa. Super. 370, 1987 Pa. Super. LEXIS 8771

• Court: Supreme Court of Pennsylvania
• Decided: August 10, 1987
• Docket: 02418
• Status: Published

Opinions

HOFFMAN, Judge:

This is an appeal from the lower court’s order granting appellee’s petition for return of property. Appellant contends that the lower court erred because the evidence was sufficient to establish that the seized property was derivative contraband and, thus, unlawfully possessed by appel-lee. After a careful review of the record, the briefs submitted by the parties and the lower court’s opinion, we find that the appellant did not meet its burden of proof in this matter, Petition of Maglisco, 341 Pa.Superior Ct. 525, 531, 491 A.2d 1381, 1384 (1985), and affirm on the lower court’s opinion.

Affirmed. Jurisdiction is relinquished.

OLSZEWSKI, J., files a dissenting opinion.

APPENDIX

LAURA SUGALSKI; CHARLES E. ROOP, SR.; CHARLES E. ROOP, JR. vs. JAY COCHRAN, JR.

MISC. NOS. 837 July 1985, 338 July 1985, 339 July 1985.

IN THE COURT OF COMMON PLEAS OF MONTGOMERY COUNTY, PENNSYLVANIA CRIMINAL DIVISION

December 23, 1986

OPINION

CORSO, Judge:

On August 8, 1985, Petitioners, Laura L. Sugalski, Charles E. Roop, Sr. and Charles E. Roop, Jr., filed petitions for return of property against Respondent, Jay Cochran, Jr., Commissioner, Pennsylvania State Police (hereinafter referred to as “Commonwealth”), seeking the return of money seized by the Pennsylvania State Police from their residences on January 29, 1985, and from a safe deposit box on January 30, 1985¹. After hearings on said Petitions, the following Order was entered by this Court on July 31, 1986:

“AND NOW, this 31st day of July, 1986, pursuant to Petitions for Return of Property, after hearings on January 30, 1986, April 14, 1986 and April 15, 1986, limited in scope by agreement of counsel to a determination of derivative contraband status without determination of the legality of search warrants and subsequent searches of Petitioners’ homes, and accepting as true for purposes of this proceeding only the affidavit in support of search warrants for the safe deposit box; and consideration of Memoranda of Law submitted and briefs of counsel, it is hereby ORDERED and DECREED that:

I. The Petition for Return of Property of Charles E. Roop, Sr. is granted, the following property is found not to be derivative contraband and shall be returned to Petitioner forthwith:

(a) $1,175.00 U.S. currency seized from Petitioner's home on January 29, 1985; and

(b) $508,700.00 seized from a safe deposit box in the Holding Company, Bryn Mawr, Pennsylvania, on January 30, 1985.

II. The Petition for Return of Property of Charles E. Roop, Jr. is granted, the following property is found not to be derivative contraband and shall be returned to Petitioner forthwith:

(a) $7,940.00 U.S. currency seized from Petitioner’s home on January 29, 1985.

III. The Petition for Return of Property of Laura L. Sugalski is granted in part and denied in part:

(1) The following property is found not to be derivative contraband and shall be returned to Petitioner forthwith:

(a) $15,500.00 U.S. currency seized from a cash box in the clothes closet of master bedroom in Petitioner’s home on January 29, 1985;

(b) $12,429.00 U.S. currency seized from a metal box under the bed of master bedroom of Petitioner’s home on January 29, 1985; and

(c) Two $25.00 savings bonds and two $50.00 savings bonds all in the name of ‘Mrs. Rosetta Keaton’ seized from a kitchen cabinet in Petitioner’s home on January 29, 1985.

(2) The following property is found to be derivative contraband and is forfeitable to the Commonwealth of Pennsylvania:

(a) $50.00 U.S. currency seized from kitchen counter in Petitioner’s home on January 29, 1985; and

(b) $1,626.00 U.S. currency and $2.00 U.S. currency seized from kitchen cabinet in Petitioner’s home on January 29, 1985.”

Notice of Appeal to the Superior Court of Pennsylvania was filed by the Commonwealth on August 22, 1986. The Statement of Matters Complained of on Appeal filed on September 9, 1986, raises two issues: whether the Court placed an evidentiary burden on the Commonwealth which is greater than that required under 47 Pa.S. § 6-602(e) as applied to 18 Pa.C.S. § 5513(b); and whether the Court abused its discretion in ordering the return of the seized money.

The facts may be summarized as follows:

On January 29, 1985, Search Warrants were obtained for Petitioners’ homes by the State Police to search for and obtain evidence of suspected illegal gambling. One warrant was executed upon the home of Charles Roop, Sr., where $1,175.00 in cash, one number’s play, and a tally sheet for two days were found. Another warrant was executed upon the home of Charles Roop, Jr., where $7,940.00 in cash, tally sheets, rice paper, line sheets, numbers bets, and sports bets were found. The proximity of the above cash to the gambling paraphernalia was not known by Troopers John L. Bergan or Joseph Moran who testified for the Commonwealth or otherwise established by the Commonwealth.

Also, on January 29,1985, a search warrant was executed upon the Sugalski home by three Pennsylvania State Troopers, including Troopers Bergan and Levingood. Cash in the sum of $15,500.00 was found in a steel box on a closet shelf of a second floor front bedroom. No gambling paraphernalia was located in this box. A second steel box was found under the bed in the same bedroom which contained items relating to a safe deposit box at the Bryn Mawr Holding Company, Bryn Mawr, Pennsylvania, cash in the amount of $12,429.00², children’s birth certificates, insurance policies, personal papers, etc. No gambling paraphernalia was found in this box. All items were left in the box with the exception of the safe deposit documents and cash which were taken to the kitchen. Although Trooper Bergan took the safe deposit box documents, he was not sure “whether it actually pertained to the case or not”. There was nothing about the cash found in the bedroom to indicate, in any manner whatsoever, that it had been used for illegal gambling, or any other unlawful purpose. No gambling paraphernalia was found in the bedroom, or anywhere on the second floor. However, the money was seized by the Commonwealth.

The first floor rear kitchen of the Sugalski home was then searched. In a top kitchen cabinet, three calculators and blank sheets of paper were found. In a lower cabinet the Troopers found among other things, $1,626.00 and $2.00 in cash, two $50.00 and two $25.00 savings bonds in the name of “Mrs. Rosetta Keaton”, rice paper, numbers bets, weeklys, dailys, and, yearlys. Fifty ($50.00) Dollars in cash and numbers bets were found on the kitchen counter. All of the above items were seized.

The following day, an Application for a Search Warrant for safe deposit box 1H-9, was presented, and the Search Warrant was issued. Upon executing the warrant at the Bryn Mawr Holding Company, the sum of $508,700.00 was found in the safe deposit box and seized by the Commonwealth.

The essence of the Commonwealth’s first argument is that the Court erred when it failed to place the burden upon Petitioners to prove that the seized money was gained or possessed lawfully as required under 47 Pa.S. § 6-602(e). The statutory provisions relied upon by the Commonwealth state:

The Crimes Code, 18 Pa.C.S.A. § 5513(b):

“Confiscation of gambling devices. — Any gambling device possessed or used in violation of the provisions of subsection (a) of this section shall be seized and forfeited to the Commonwealth. All provisions of law relating to the seizure, summary and judicial forfeiture, and condemnation of intoxicating liquor shall apply to seizures and forfeitures under the provisions of this section.”

The Liquor Code, 47 Pa.S.A. 6-602(e):

“At the time of said [forfeiture] hearing, if the Commonwealth shall produce evidence that the property in question was unlawfully possessed or used, the burden shall be upon the claimant to show (1) that he is the owner of said property, (2) that he lawfully acquired the same, and (3) that it was not unlawfully used or possessed.”

The Commonwealth concedes that^ “money is not, ordinarily, itself an instrumentality of gambling” Fairmount Engine Company v. Montgomery County, 135 Pa.Super. 367, 371, 5 A.2d 419 (1938), however, it contends that money is subject to seizure and forfeiture along with gambling devises when the circumstances clearly show that the money formed an integral part of an illegal gambling operation. Thus, the Commonwealth contends that the seized money is derivative contraband of gambling operations. The leading case concerning the forfeiture of money alleged to be derivative contraband of illegal gambling is Rosen v. LeS-trange, 120 Pa.Super. 59, 61-62 [181 A. 797] (1935):

“Money may, nevertheless, be subject to seizure, along with contraband gambling devices, apparatus of instru-mentalities, (Commonwealth v. Sinn, 82 Pa.Superior Ct. 482, 484; Commonwealth v. Kaiser, 80 Pa.Superior Ct. 26, 28) when the circumstances are such that it is clearly apparent that it formed an integral part of the illegal gambling operation and, being commingled with other such money, had not, previous to the seizure, been reclaimed and taken back into his own possession by the player, nor been received and reduced to the exclusive possession and ownership of the winner, or owner of the gambling device, or proprietor of the gambling establishment. Thus money found in a gambling slot machine, when seized, may be held with the machine and be confiscated by the Commonwealth; for while it had passed out of the ownership of the players, who inserted it in the machine, it had not been reduced to the possession and ownership of the proprietor; he does not become the owner of the money while it is contained in a receptacle within the illegal and contraband gambling machine. So money found lying on a roulette wheel, or rouge et noir table, when the gambling device is seized, if so commingled that its prior ownership has been lost, may, in like manner, be subject to confiscation, Com. v. Sinn, supra, Pa. 484. Money received for lottery tickets and ‘policy’ slips and from playing ‘numbers,’ and held awaiting the drawing of the lottery, or the determination of the winning number, if earmarked or segregated so as to be identified as part of the gambling operation, may likewise be confiscated as contraband by the authorities with the gambling instrumentality: Appeal of Joe Curcio, 106 Pa.Superior Ct. 53, 161 A 627.”

Forfeiture proceedings have been held to be civil in rem proceedings, which are quasi criminal in character. One Plymouth Sedan v. Pennsylvania, 380 U.S. 693, 85 S.Ct. 1246, 14 L.Ed.2d 170 (1965). The burden is upon the Commonwealth to show, by original proof, that the property sought to be returned must, instead, be forfeited. Commonwealth v. 3 Halves of Beer, 162 Pa.Super. 191, 56 A.2d 333 (1948). Since the proceeding is civil in rem, the Commonwealth is not held to the same degree of proof required in a criminal case, it need only produce sufficient evidence to satisfy, reasonably, an unbiased mind to that degree of certainty which a judicial disposition of the issue requires. Urban’s Appeal, 148 Pa.Super. 101, 24 A.2d 756 (1942); Graham v. DiJoseph, 74 Montg. Co. L.R. 114 (1957). The Commonwealth’s burden, essentially a preponderance of the evidence, has also been stated to be:

“... whether a judicial fact finder could reasonably be satisfied from all the evidence ... [citation omitted] ... that it (the money) formed an integral part of the illegal gambling operation and, being commingled with other such money, had not, previous to seizure, been reclaimed and taken back into his own possession by the player, nor been received and reduced to the exclusive possession and ownership of the ... proprietor of the gambling establishment. Rosen v. LeStrange, 120 Pa.Superior Ct. 59, 61, 181 A.797.” Commonwealth v. Petrillo, 158 Pa.Super. 354, 45 A.2d 404 (1946).

It must be noted that forfeiture is a drastic remedy that is not favored by the law and that such statutes must be strictly construed and will not be extended beyond their plain, ordinary and usual meaning. See 37 C.J.S., Forfeitures § 46; Zafino Estate, 375 Pa. 501, 100 A.2d 60 (1953); Nave v. Commonwealth, 74 Montg.Co.L.R. 410 (1958).

Considering the safe deposit box, what evidence has the Commonwealth presented to establish its derivative contraband contention? The Commonwealth’s theory is that an ongoing gambling activity, such as alleged to have been conducted by Petitioners, would need a bank, a reserve to back up the winners, and the money in the safe deposit box constituted same. Although the Commonwealth states that the courts have somewhat expanded the proximity nexus, there is no connection with gambling, gambling devises or paraphernalia in this case; nothing in the steel box, in the bedroom or even on the second floor of the Sugalski home. In addition, the steel box contained personal items such as birth certificates, insurance policies and personal papers.

Was the money in the safe deposit box, with the access documents in a steel box under the bed on the second floor of the Sugalski home, reduced to the exclusive possession and ownership of the Petitioner? Clearly, and this Court heard no evidence to lead it to conclude otherwise.

Was the money in the safe deposit box held pending the determination of a winner? Was it earmarked or segregated so as to be identified as an integral part of the gambling operation? The money was deposited in the safe deposit box on June 14, 1984, and, according to the records of the Holding Company, nobody entered the safe deposit box from the date it was opened until January 30,1985, the date of the search and seizure. In excess of seven month had passed without anybody touching the money. This fact is fatal to the Commonwealth’s theory. The Commonwealth has provided absolutely no basis to conclude that this money was an integral part of the gambling operation and was simply awaiting the determination of a winner. The Commonwealth also asserts that the money must be the proceeds of illegal gambling. This constitutes a boot strap argument based upon the Commonwealth’s suspicion, not evidence. See, Commonwealth v. Tornetta, 76 Montg.Co. L.R. 565 (1960).

The additional seizures of money at issue in this case are:

(1) The $1,175.00 cash, found somewhere in the home of Charles Roop,‘ Sr.;

(2) The $7,940.00 cash, found somewhere in the home of Charles Roop, Jr.;

(3) The $15,500.00 cash, found in a steel box, on a closet shelf, in the Master bedroom, of the Sugalski home;

(4) The $12,429.00 consisting of $7,000.00 cash, found in a steel box under the bed in the Master bedroom of the Sugalski home, and $5,429.00 cash, in the china closet in the dining room of the Sugalski home.

The Commonwealth must meet its burden with regard to each seizure for forfeiture to occur. The Commonwealth’s evidence established the following circumstances with regard to each of the seizures:

(1) No gambling paraphernalia was found with any of the money;

(2) No gambling paraphernalia was found in the vicinity or even in the same room with any of the money; and

(3) There was nothing about the money to indicate that it was being used, or had been sued, for illegal gambling, or any other unlawful purpose.

The money seized at the Sugalski home was located in a china closet in the dining room, and in the master bedroom on the second floor. The money in the bedroom was located in a locked steel box in the clothes closet, and in a locked steel box under the bed with personal papers. The Commonwealth could not even establish where the money seized at either the Charles Roop, Sr. or Charles Roop, Jr. home was located. Again, the Commonwealth is attempting to utilize conjecture and suspicion in place of evidence to expand the law beyond its present statutory and decisional posture.

The Commonwealth has failed to meet its burden of establishing that any of the seized money is an integral part of an illegal gambling operation; that prior to seizure it had not been received and reduced to the exclusive possession and ownership of Petitioners; or that it was earmarked or segregated so as to be identified as part of the gambling operation.

Based upon the foregoing, the Commonwealth concedes that the seized cash is not a “gambling devise possessed or used in violation of the provisions of subsection (a)”, and has failed to “produce evidence that the property in question was unlawfully possessed or used” as required by 18 Pa.C.S.A. § 5513(b) and 47 Pa.S.A. 6-602(e). As such, the burden does not shift to Petitioners to show that they are the owners, that they lawfully acquired the property and that it is not unlawfully used or possessed.

Accordingly, the Order of July 31, 1986, is in accord with the law, does not constitute an abuse of discretion and must be affirmed.

1 . In addition, on January 27, 1986, Petitioners filed a Motion to Suppress which addressed evidence obtained from interception of wire communication. This was not heard by the Court based upon agreement of counsel at the hearings and embodied in this Court’s Order of July 31, 1986 set forth hereinafter.

2 . This amount of money was grouped by Trooper Bergan with an amount of money found in the dining room china closet. No gambling paraphernalia was found in the dining room.