United States v. One Urban Lot

Opinion

USCA1 Opinion

November 5, 1992  UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT
                                _____________________

          No. 92-1247

                              UNITED STATES OF AMERICA,

                                 Plaintiff, Appellee,

                                          v.

                                    ONE URBAN LOT,

                                 Defendant, Appellee.

MIRIAM RUTH GELABERT-ALVAREZ,

                                      Appellant.

                                 ____________________

                     APPEAL FROM THE UNITED STATES DISTRICT COURT

                           FOR THE DISTRICT OF PUERTO RICO

                    [Hon. Jaime Pieras, Jr., U.S. District Judge]
                                             ___________________

                                 ____________________

                                        Before

                                 Breyer, Chief Judge,
                                         ___________
                            Bownes, Senior Circuit Judge,
                                    ____________________
                              and Boudin, Circuit Judge.
                                          _____________

                                 ____________________

               Luis A. Medina-Torres  for appellant, Miriam  Ruth Gelabert-
               _____________________
          Alvarez.
               Jose F. Blanco, Assistant  United States Attorney, with whom
               ______________
          Daniel  Lopez-Romo,  United States  Attorney,  was  on brief  for
          __________________
          appellee, United States of America.

                                 ____________________

____________________

BOWNES,  Senior Circuit  Judge.   The sole  issue in
                              _____________________

            this forfeiture case is whether the district court abused its

            discretion  in striking  the claim  of appellant  Miriam Ruth

            Gelabert Alvarez  to the forfeited properties  because it was

            filed out of time.   We find that the district court  did not

            abuse its discretion.

                     Rule  C(6) of  the  Supplemental  Rules For  Certain

            Admiralty and Maritime  Claims frames  the time  requirements

            for filing a claim in forfeiture proceedings.  It provides in

            pertinent part:

                           (6)      Claim       and      Answer;
                                    Claim       and      Answer;
                     Interrogatories.  The claimant  of property
                     Interrogatories.
                     that  is the  subject of  an action  in rem
                     shall file  a  claim within  10 days  after
                     process has been  executed, or within  such
                     additional time  as may be  allowed by  the
                     court, and shall serve  an answer within 20
                     days after the filing of the claim.

            The claimant-appellant  did not file her  claim until thirty-

            seven days after process  was executed.  She argues  that the

            district  court abused  its  discretion in  not allowing  her

            additional  time to  file.   Our  assessment  of whether  the

            district  court abused its discretion is made in light of the

            facts available to the trial judge.

                                          I.
                                          I.

                     The  forfeiture  proceeding  was  commenced  by  the

            government  on  March 7,  1991,  pursuant  to the  Controlled

            Substances  Act, 21 U.S.C.     881(a)(6) and  (a)(7), and the

            Money  Laundering  Act,  18  U.S.C.     981.    Claimant  was

personally notified of  the forfeiture  proceedings on  March

            27,  1991, when she  appeared at the  United States Marshal's

            Office  in San Juan accompanied  by an attorney.   Notice was

            also given by  publication in  El Nuevo Dia,  a newspaper  of
                                           ____________

            general circulation in Puerto Rico, on March 25, April 2, and

            April 10, 1991.  Claimant filed a claim to the properties and

            an answer to  the forfeiture complaint on May  3, 1991.  This

            was thirty-seven days  after claimant  had received  personal

            notice  of the  forfeiture proceedings  at the  United States

            Marshal's Office.

                     There  were  other  facts  available  to  the  court

            bearing on the  question of abuse of  discretion.  Claimant's

            husband,  Fernando  Faccio-Laboy,  was  indicted  and,  after

            trial,  convicted for  conspiring to  buy fifty  kilograms of

            cocaine from  a confidential  informant working for  the Drug

            Enforcement  Administration.   The  "buy"  took  place in  an

            apartment building  known as  the Feria Court  Condominium on

            August 15, 1990.  After the arrest of claimant's husband, the

            government  started forfeiture  against Faccio's  interest in

            the Feria Court  Development Corp., owner of the  building in

            which  the  cocaine transaction  took  place.   Claimant  was

            notified of this forfeiture on October 10, 1990.  She did not

            appear and the property owned by her husband was sold.  After

            further   investigation,   the  government   discovered  that

            claimant's   husband  had   an  extensive   money  laundering

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operation consisting  of a number of  real estate development

            corporations   and  real  property.     It   brought  another

            forfeiture case against the development corporations and real

            estate held by them.  This is the forfeiture case giving rise

            to claimant's appeal.

                     On  May  17,  1991,  the United  States  moved  that

            appellant's claim be  stricken because of  late filing.   Its

            motion  was granted on December 17, 1991.  Claimant moved for

            reconsideration on  December 23, 1991.  The motion was denied

            on January 8, 1992.

                                         II.
                                         II.

                     Claimant  argues that  her  late filing  was due  to

            "disorientation and  confusion" brought  on by  her husband's

            indictment for drug dealing.   In her claim she  alleged that

            she owned a  50% interest in  a mortgage note payable  to her

            husband and herself in the amount of $19,055.00, described as

            property A in the forfeiture, and a  50% interest in the real

            estate  referred   to  as  property  B   in  the  forfeiture.

            Paragraph 3 of appellant's claim states:

                           3.  That claimant demands restitution
                     of her  interest in such  property based on
                     the fact that no illegal act or conduct has
                     been  performed  in these  properties; said
                     properties have not  been used or  intended
                     to  be  used  to commit  or  facilitate the
                     commission  of  any crime;  said properties
                     are  not values [sic] furnished or intended
                     to   be  furnished   in   exchange  for   a
                     controlled substance, nor are they proceeds
                     traceable to such an exchange; and claimant
                     or her property has  nothing to do with the

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acts or omissions of other  persons on such
                     property, that  she had no knowledge of any
                     acts  that could be  committed nor  she had
                     reasons to believe that any illegal act was
                     being committed in her property.

                     Claimant  argues that the district court applied the

            wrong  standard in ruling on her motion to accept late filing

            of  her claim.  The standard  applied, according to claimant,

            was  that  Rule C(6)  "must be  construed  to the  letter, no

            matter  what excuse the finding party may provide."  Brief at

            4.  In striking claimant's claim the district judge stated:

                           The  claimant  has  failed to  comply
                     with the Rule C(6) Supplemental Rule to the
                     Federal  Rules of Civil  Procedure, ten day
                     deadline.  Accordingly,  its claim must  be
                     STRICKEN from the record.

                     Although the  order if  read  in a  vacuum could  be

            interpreted  as  claimant  does,  the judge  had  before  him

            claimant's   pleading  pointing   out  that   discretion  was

            available, and although the government's opposition initially

            suggested  or  implied an  absence  of  discretion (absent  a

            timely motion to enlarge time), it went on to paraphrase case

            law  recognizing   such  discretion  and  then  disputed  the

            adequacy  of the  justification in  this  case.   Under these

            circumstances,  we must  assume that  the district  judge was

            aware  that under  the  Rule he  had  the authority  to  give

            claimant  more than ten  days in which  to file a  claim.  We

            also  must assume  that  the judge  was  fully aware  of  the

            background   facts,  and   particularly  that   claimant  was

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accompanied  by  an attorney  when  she was  notified  of the

            forfeiture proceedings against the properties, and  her prior

            exposure to forfeiture proceedings.

                                         III.
                                         III.

                     Our  review  is  under   the  abuse  of   discretion

            standard.  U.S.  v. One Dairy  Farm, 918  F.2d 310, 311  (1st
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            Cir. 1990).

                     Before a claimant in a  forfeiture case can file  an

            answer and defend  on the merits, a claim must  be filed.  If

            no  claim  is filed,  a putative  claimant lacks  standing to

            contest a  forfeiture.  U.S. v.  One Dairy Farm, 918  F.2d at
                                    _______________________

            311.  U.S. v. One Urban Lot Located At 1 Street A-1, 885 F.2d
                  _____________________________________________

            994,  999 (1st  Cir. 1989).   There  can be  no doubt  that a

            district court can  extend the ten-day deadline  for filing a

            claim.    That  is  a  matter  within  the  district  judge's

            discretion.  In light of the record facts in this case, there

            is no basis for a finding that  the district court abused its

            discretion in imposing the ten-day restriction.

                     Affirmed.

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