H.B. 38

1

ASSET FORFEITURE IN CONTROLLED
2 SUBSTANCES VIOLATIONS
3 1997 GENERAL SESSION
4 STATE OF UTAH
5 Sponsor: John B. Arrington
6 AN ACT RELATING TO OCCUPATIONS AND PROFESSIONS; AMENDING THE
7 FORFEITURE PROVISIONS IN THE UTAH CONTROLLED SUBSTANCES ACT;
8 PROVIDING FOR SUMMARY AND ADMINISTRATIVE FORFEITURE; AND MAKING
9 TECHNICAL CORRECTIONS.
10 This act affects sections of Utah Code Annotated 1953 as follows:
11 AMENDS:
12 58-37-13, as last amended by Chapters 198 and 294, Laws of Utah 1996
13 Be it enacted by the Legislature of the state of Utah:
14 Section 1. Section 58-37-13 is amended to read:
15 58-37-13. Property subject to forfeiture -- Seizure -- Procedure.
16 (1) As used in this section:
17 (a) "Complaint" means a verified civil in rem complaint seeking forfeiture or any criminal
18 information or indictment which contains or is amended to include a demand for forfeiture of a
19 defendant's in personam interest in any property which is subject to forfeiture.
20 (b) "Drug distributing paraphernalia" means any property used or designed to be used in
21 the illegal transportation, storage, shipping, or circulation of a controlled substance. Property is
22 considered "designed to be used" for one or more of the above-listed purposes if the property has
23 been altered or modified to include a feature or device which would actually promote or conceal
24 a violation of this chapter.
25 (c) "Drug manufacturing equipment or supplies" includes any illegally possessed
26 controlled substance precursor, or any chemical, laboratory equipment, or laboratory supplies
27 possessed with intent to engage in clandestine laboratory operation as defined in Section 58-37d-3.

1 (d) "Interest holder" means a secured party as defined in Section 70A-9-105(1)(m), a
2 mortgagee, lien creditor, or the beneficiary of a security interest or encumbrance pertaining to an
3 interest in property, whose interest would be perfected against a good faith purchaser for value.
4 A person who holds property for the benefit of or as an agent or nominee for another, or who is
5 not in substantial compliance with any statute requiring an interest in property to be recorded or
6 reflected in public records in order to perfect the interest against a good faith purchaser for value,
7 is not an interest holder.
8 (e) "Proceeds" means property acquired directly or indirectly from, produced through,
9 realized through, or caused by an act or omission and includes any property of any kind without
10 reduction for expenses incurred in the acquisition, maintenance, or production of that property, or
11 any other purpose.
12 (f) "Resolution of criminal charges" occurs at the time a claimant who is also charged with
13 violations under Title 58, Chapters 37, 37a, 37b, 37c, or 37d enters a plea, upon return of a jury
14 verdict or court ruling in a criminal trial, or upon dismissal of the criminal charge.
15 (g) "Violation of this chapter" means any conduct prohibited by Title 58, Chapters 37, 37a,
16 37b, 37c, or 37d or any conduct occurring outside the state which would be a violation of the laws
17 of the place where the conduct occurred and which would be a violation of Title 58, Chapters 37,
18 37a, 37b, 37c, or 37d if the conduct had occurred in this state.
19 (2) The following are subject to forfeiture and no property right exists in them:
20 (a) all controlled substances which have been manufactured, distributed, dispensed, or
21 acquired in violation of this chapter;
22 (b) all raw materials, products, and equipment of any kind used, or intended for use, in
23 manufacturing, compounding, processing, delivering, importing, or exporting any controlled
24 substance in violation of this chapter;
25 (c) all property used or intended for use as a container for property described in
26 Subsections (2)(a) and (2)(b);
27 (d) all hypodermic needles, syringes, and other paraphernalia, not including capsules used
28 with health food supplements and herbs, used or intended for use to administer controlled
29 substances in violation of this chapter;
30 (e) all conveyances including aircraft, vehicles, or vessels used or intended for use, to
31 transport, or in any manner facilitate the transportation, sale, receipt, simple possession, or

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1 concealment of property described in Subsections (2)(a) and (2)(b), except that:
2 (i) a conveyance used by any person as a common carrier in the transaction of business as
3 a common carrier may not be forfeited under this section unless the owner or other person in
4 charge of the conveyance was a consenting party or knew or had reason to know of the violation
5 of this chapter;
6 (ii) a conveyance may not be forfeited under this section by reason of any act or omission
7 committed or omitted without the owner's knowledge or consent; and
8 (iii) any forfeiture of a conveyance is subject to the claim of an interest holder who did not
9 know or have reason to know after the exercise of reasonable diligence that a violation would or
10 did take place in the use of the conveyance;
11 (f) all books, records, and research, including formulas, microfilm, tapes, and data used
12 or intended for use in violation of this chapter;
13 (g) everything of value furnished or intended to be furnished in exchange for a controlled
14 substance in violation of this chapter, and all moneys, negotiable instruments, and securities used
15 or intended to be used to facilitate any violation of this chapter. An interest in property may not
16 be forfeited under this subsection unless it is proven by a preponderance of the evidence that the
17 interest holder knew, had reason to know of, or consented to the conduct which made the property
18 subject to forfeiture. The burden of presenting this evidence shall be upon the state;
19 (h) all imitation controlled substances as defined in Section 58-37b-2, Imitation Controlled
20 Substances Act;
21 (i) all warehousing, housing, and storage facilities, or interest in real property of any kind
22 used, or intended for use, in producing, cultivating, warehousing, storing, protecting, or
23 manufacturing any controlled substances in violation of this chapter, except that:
24 (i) any forfeiture of a housing, warehousing, or storage facility or interest in real property
25 is subject to the claim of an interest holder who did not know or have reason to know after the
26 exercise of reasonable diligence that a violation would take place on the property;
27 (ii) an interest in property may not be forfeited under this subsection if the interest holder
28 did not know or have reason to know of the conduct which made the property subject to forfeiture,
29 or did not willingly consent to the conduct; and
30 (iii) unless the premises are used in producing, cultivating, or manufacturing controlled
31 substances, a housing, warehousing, or storage facility or interest in real property may not be

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1 forfeited under this subsection unless cumulative sales of controlled substances on the property
2 within a two-month period total or exceed $1,000, or the street value of any controlled substances
3 found on the premises at any given time totals or exceeds $1,000. A narcotics officer experienced
4 in controlled substances law enforcement may testify to establish the street value of the controlled
5 substances for purposes of this subsection;
6 (j) any firearm, weapon, or ammunition carried or used during or in relation to a violation
7 of this chapter or any firearm, weapon, or ammunition kept or located within the proximity of
8 controlled substances or other property subject to forfeiture under this section; and
9 (k) all proceeds traceable to any violation of this chapter. There is a rebuttable
10 presumption that all money, coins, and currency found in proximity to forfeitable controlled
11 substances, drug manufacturing equipment or supplies, drug distributing paraphernalia, or
12 forfeitable records of importation, manufacture, or distribution of controlled substances are
13 proceeds traceable to a violation of this chapter. The burden of proof is upon the claimant of the
14 property to rebut this presumption.
15 (3) (a) Property subject to forfeiture under this chapter may be seized by any peace officer
16 of this state upon process issued by any court having jurisdiction over the property. However,
17 seizure without process may be made when:
18 (i) the seizure is incident to an arrest or search under a search warrant or an inspection
19 under an administrative inspection warrant;
20 (ii) the property subject to seizure has been the subject of a prior judgment in favor of the
21 state in a criminal injunction or forfeiture proceeding under this chapter;
22 (iii) the peace officer has probable cause to believe that the property is directly or
23 indirectly dangerous to health or safety; or
24 (iv) the peace officer has probable cause to believe that the property has been used or
25 intended to be used in violation of this chapter and has probable cause to believe the property will
26 be damaged, intentionally diminished in value, destroyed, concealed, or removed from the state.
27 (b) Upon the filing of a complaint, the court shall immediately issue to the seizing agency
28 a warrant for seizure of any property subject to forfeiture which had been seized without a warrant
29 in a manner described in this subsection.
30 (4) In the event of seizure under Subsection (3), forfeiture proceedings under Subsection
31 (9) shall be instituted within 90 days of the seizure. The time period may by extended by the court

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1 having jurisdiction over the property upon notice to all claimants and interest holders and for good
2 cause shown.
3 (5) Property taken or detained under this section is not repleviable but is in custody of the
4 law enforcement agency making the seizure, subject only to the orders and decrees of the court or
5 the official having jurisdiction. When property is seized under this chapter, the appropriate person
6 or agency may:
7 (a) place the property under seal;
8 (b) remove the property to a place designated by it or the warrant under which it was
9 seized; or
10 (c) take custody of the property and remove it to an appropriate location for disposition
11 in accordance with law.
12 (6) [All] (a) The following shall be considered contraband, seized, and summarily forfeited
13 to the state:
14 (i) all controlled substances listed in Schedule I or II or marijuana, that are possessed,
15 transferred, distributed, or offered for distribution in violation of this chapter [are contraband and
16 no property right shall exist in them.];
17 (ii) all dangerous, toxic, or hazardous materials or products subject to forfeiture under
18 Subsection (2)(b); and
19 (iii) any property subject to forfeiture under Subsection (2)(b), (c), or (d) which cannot be
20 separated safely from the raw materials.
21 (b) All [substances listed in Schedule I] items under this subsection which are seized or
22 come into the possession of the state may be retained for any evidentiary or investigative purpose,
23 including sampling or other preservation prior to disposal or destruction by the state.
24 (c) The attorney general may direct the destruction of all items listed under Subsection (a)
25 under circumstances the attorney general considers necessary.
26 (7) All marijuana or any species of plants from which controlled substances in Schedules
27 I and II are derived which have been planted or cultivated in violation of this chapter, or of which
28 the owners or cultivators are unknown, or are wild growths, may be seized and retained for any
29 evidentiary or investigative purpose, including sampling or other preservation prior to disposal or
30 destruction by the state. Failure, upon demand by the department or its authorized agent, of any
31 person in occupancy or in control of land or premises upon which species of plants are growing

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1 or being stored, to produce an appropriate license or proof that he is the holder of a license, is
2 authority for the seizure and forfeiture of the plants.
3 (8) When any property is forfeited under this chapter by a finding of the court that no
4 person is entitled to recover the property, it shall be deposited in the custody of the Division of
5 Finance. Disposition of all property is as follows:
6 (a) The state may include in its complaint seeking forfeiture, a request that the seizing
7 agency be awarded the property. Upon a finding that the seizing agency is able to use the forfeited
8 property in the enforcement of controlled substances laws, the court having jurisdiction over the
9 case shall award the property to the seizing agency. Each agency shall use the forfeited property
10 for controlled substance law enforcement purposes only. Forfeited property or proceeds from the
11 sale of forfeited property may not be used to pay any cash incentive, award, or bonus to any peace
12 officer or individual acting as an agent for the agency, nor may it be used to supplant any ordinary
13 operating expense of the agency. The seizing agency shall pay to the prosecuting agency the legal
14 costs incurred in filing and pursuing the forfeiture action. Property forfeited under this section
15 may not be applied by the court to costs or fines assessed against any defendant in the case.
16 (b) The seizing agency, or if it makes no application, any state agency, bureau, county, or
17 municipality, which demonstrates a need for specific property or classes of property subject to
18 forfeiture shall be given the property for use in enforcement of controlled substances laws upon
19 the payment of costs to the county attorney or, if within a prosecution district, the district attorney
20 for legal costs for filing and pursuing the forfeiture and upon application for the property to the
21 director of the Division of Finance. The application shall clearly set forth the need for the property
22 and the use to which the property will be put.
23 (c) The director of the Division of Finance shall review all applications for property
24 submitted under Subsection (8)(b) and, if the seizing agency makes no application, make a
25 determination based on necessity and advisability as to final disposition and shall notify the
26 designated applicant or seizing agency, where no application is made, who may obtain the property
27 upon payment of all costs to the appropriate department. The Division of Finance shall in turn
28 reimburse the prosecuting agency or agencies for costs of filing and pursuing the forfeiture action,
29 not to exceed the amount of the net proceeds received for the sale of the property. Any proceeds
30 remaining after payment shall be returned to the seizing agency or agencies.
31 (d) If no disposition is made upon an application under Subsection (8)(a) or (b), the

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1 director of the Division of Finance shall dispose of the property by public bidding or as considered
2 appropriate, by destruction. Proof of destruction shall be upon oath of two officers or employees
3 of the department having charge of the property, and verified by the director of the department or
4 his designated agent.
5 [(9) Forfeiture proceedings shall be commenced as follows:]
6 [(a) For actions brought under Subsections (2)(a) through (2)(j), a complaint shall be
7 prepared by the county attorney, or if within a prosecution district, the district attorney, or the
8 attorney general, and filed in a court of record where the property was seized or is to be seized. In
9 cases in which the claimant of the property is also charged as a criminal defendant, the complaint
10 shall be filed in the county where the criminal charges arose, regardless of the location of the
11 property. The complaint shall include:]
12 [(i) a description of the property which is subject to forfeiture;]
13 [(ii) the date and place of seizure, if known; and]
14 [(iii) the allegations of conduct which gives rise to forfeiture.]
15 (9) (a) Forfeiture proceedings may be commenced as:
16 (i) civil in personam actions as part of a criminal prosecution where the complainant is
17 also charged as a criminal defendant with the acts giving rise to the forfeiture;
18 (ii) separate civil in rem actions against the property filed where the property is located,
19 seized, or encumbered; or
20 (iii) both, where there is, or may be, more than one claimant.
21 (b) In cases where a claimant is also charged as a criminal defendant, the forfeiture [shall]
22 may proceed as part of the criminal prosecution as an in personam action against the defendant's
23 interest in the property subject to forfeiture. A defendant need not file a written answer to the
24 complaint, but may acknowledge or deny interest in the property at the time of first appearance
25 on the criminal charges. If a criminal information or indictment is amended to include a demand
26 for forfeiture, the defendant may respond to the demand at the time of the amendment.
27 (i) Unless motion for disposition is made by the defendant, the determination of forfeiture
28 shall be stayed until resolution of the criminal charges. Hearing on the forfeiture shall be before
29 the court without a jury. The court may consider any evidence presented in the criminal case, and
30 receive any other evidence offered by the state or the defendant. The court shall determine by a
31 preponderance of the evidence the issues in the case and order forfeiture or release of the property

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1 as it determines.
2 (ii) A defendant may move the court to transfer the forfeiture action, to stay all action,
3 including discovery, in the forfeiture, or for hearing on the forfeiture any time prior to trial of the
4 criminal charges. Either party may move the court to enter a finding of forfeiture as to defendant's
5 interest in part or all of the property, either by default or by stipulation. Upon entry of a finding,
6 the court shall stay the entry of judgment until resolution of the criminal charges. Any finding of
7 forfeiture entered by the court prior to resolution of the criminal charges may not constitute a
8 separate judgment, and any motion for disposition, stay, severance, or transfer of the forfeiture
9 action may not create a separate proceeding. Upon the granting of a motion by the defendant for
10 disposition, stay, severance, or transfer of the forfeiture action, the defendant shall be considered
11 to have waived any claim that the defendant has been twice put in jeopardy for the same offense.
12 (iii) Any other person claiming an interest in property subject to forfeiture under this
13 subsection may not intervene in a trial or appeal of a complaint filed under this subsection.
14 Following the entry of an in personam forfeiture order, or upon the filing of a petition for release
15 under Subsection (e), the county attorney, district attorney, or attorney general may proceed with
16 a separate in rem action to resolve any other claims upon the property subject to forfeiture.
17 (c) [A complaint seeking forfeiture under Subsection (2)(k) shall be prepared by the county
18 attorney, or if within a prosecution district, the district attorney, or by the attorney general, either
19 in personam as part of a criminal prosecution, or in a separate civil in rem action against the
20 property alleged to be proceeds, and filed in the county where the property is seized or
21 encumbered, if the proceeds are located outside the state. A] In cases where forfeiture is sought
22 as a separate civil in rem action against the property, a finding that the property is the proceeds of
23 a violation of this chapter does not require proof that the property is the proceeds of any particular
24 exchange or transaction. Proof that the property is proceeds may be shown by evidence which
25 establishes all of the following by a preponderance of the evidence:
26 (i) that the person has engaged in conduct in violation of this chapter;
27 (ii) that the property was acquired by the person during that period when the conduct in
28 violation of this chapter occurred or within a reasonable time after that period; and
29 (iii) that there was no likely source for the property other than conduct in violation of the
30 chapter.
31 (d) [Notice] In all cases, a complaint seeking forfeiture shall be prepared by the county

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1 attorney, or if within a prosecution district, by the district attorney, or by the attorney general and,
2 together with notice of the seizure and intended forfeiture, shall be filed with the clerk of the court,
3 and served upon all persons known to the county attorney [or], district attorney, or attorney general
4 to have a claim in the property by:
5 (i) personal service upon a claimant who is charged in a criminal information or
6 indictment; and
7 (ii) certified mail to each claimant whose name and address is known or to each owner
8 whose right, title, or interest is of record in the Division of Motor Vehicles to the address given
9 upon the records of the division, which service is considered complete even though the mail is
10 refused or cannot be forwarded. The county attorney, district attorney, or attorney general shall
11 make one publication in a newspaper of general circulation in the county where the seizure was
12 made for all other claimants whose addresses are unknown, but who are believed to have an
13 interest in the property.
14 (e) Except under Subsection (9)(a)(i), in personam actions, any claimant or interest holder
15 shall file with the court a verified answer to the complaint within 20 days after service. When
16 property is seized under this chapter, any interest holder or claimant of the property, prior to being
17 served with a complaint under this section, may file a petition in the court having jurisdiction for
18 release of his interest in the property. The petition shall specify the claimant's interest in the
19 property and his right to have it released. A copy shall be served upon the county attorney or, if
20 within a prosecution district, the district attorney in the county of the seizure, who shall answer
21 the petition within 20 days. A petitioner need not answer a complaint of forfeiture.
22 (f) For civil in rem actions [in rem] under Subsection (9)(a)(ii), after 20 days following
23 service of a complaint or petition for release, the court shall examine the record and if no answer
24 is on file, the court shall allow the complainant or petitioner an opportunity to present evidence
25 in support of his claim and order forfeiture or release of the property as the court determines. If
26 the county attorney or district attorney has not filed an answer to a petition for release and the court
27 determines from the evidence that the petitioner is not entitled to recovery of the property, it shall
28 enter an order directing the county attorney or district attorney to answer the petition within ten
29 days. If no answer is filed within that period, the court shall order the release of the property to
30 the petitioner entitled to receive it.
31 (g) When an answer to a complaint or petition appears of record at the end of 20 days, the

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1 court shall set the matter for hearing. At this hearing all interested parties may present evidence
2 of their rights of release of the property following the state's evidence for forfeiture. The court
3 shall determine by a preponderance of the evidence the issues in the case and order forfeiture or
4 release of the property as it determines.
5 (h) When the court determines that claimants have no right in the property in whole or in
6 part, it shall declare the property to be forfeited.
7 (i) When the court determines that property, in whole or in part, is not subject to forfeiture,
8 it shall order release of the property to the proper claimant. If the court determines that the
9 property is subject to forfeiture and release in part, it shall order partial release and partial
10 forfeiture. When the property cannot be divided for partial forfeiture and release, the court shall
11 order it sold and the proceeds distributed:
12 (i) first, proportionally among the legitimate claimants;
13 (ii) second, to defray the costs of the action, including seizure, storage of the property,
14 legal costs of filing and pursuing the forfeiture, and costs of sale; and
15 (iii) third, to the Division of Finance for the General Fund.
16 (j) In a proceeding under this section where forfeiture is declared, in whole or in part, the
17 court shall assess all costs of the forfeiture proceeding, including seizure and storage of the
18 property, against the individual or individuals whose conduct was the basis of the forfeiture, and
19 may assess costs against any other claimant or claimants to the property as appropriate.




Legislative Review Note
as of 12-12-96 3:47 PM

A limited legal review of this bill raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel

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