427 P.3d 1174
Utah2018Background
- UHP seized about $500,000 from Kyle Savely on Nov. 27, 2016; Savely received a statutorily required notice of intent to seek forfeiture and the cash was deposited into a UHP seized-currency account.
- No Utah forfeiture filing was made within 75 days; on Jan. 13, 2017 a federal magistrate issued a DEA seizure warrant and UHP sent the DEA a check for the cash amount on Jan. 24 (the check was never cashed).
- On Feb. 10, 2017 Savely petitioned Utah district court to compel return of his funds under Utah Code § 24-4-104(1)(a); the district court initially ordered return of the money.
- After UHP stopped payment on the check and the DEA obtained a second federal seizure warrant, the district court reconsidered and dismissed Savely’s petition for lack of in rem jurisdiction, concluding the federal court first exercised jurisdiction.
- The Utah Supreme Court reviewed whether Utah district courts acquire in rem jurisdiction over seized property under the Forfeiture and Disposition of Property Act (the Act) before a filing, and whether the later federal seizure warrant divested the state court of that jurisdiction.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| When does a Utah district court begin exercising in rem jurisdiction under the Act? | Savely: in rem jurisdiction attaches when the seizing agency serves the statutorily required notice of intent to seek forfeiture (no court filing required). | UHP/United States: jurisdiction requires a filing in state court (or at least one of the statutory filings within 75 days). | Court held the Act vests in rem jurisdiction in the district court over "property held for forfeiture," and property becomes "held for forfeiture" at least when the agency serves the notice of intent to seek forfeiture. |
| Whether the Act’s provisions (custody/control and transfer restrictions) permit in rem jurisdiction absent a court filing | Savely: Act’s language (custody in district court; prohibitions on alienation/transfer without court order; remedies like hardship petitions) shows jurisdiction arises without filing. | UHP/United States: general jurisdiction provision referencing "action filed" shows legislature intended filing threshold. | Court resolved ambiguity by harmonizing provisions and legislative history, concluding Act’s scheme creates court control and turnover restrictions that support in rem jurisdiction at notice stage. |
| Effect of federal seizure warrant and UHP’s check to DEA on state in rem jurisdiction | Savely: federal actions could not divest state court that already had in rem jurisdiction; any federal attempt required a turnover order from state court. | UHP/United States: federal seizure warrant (and the agency check) vested federal in rem jurisdiction first because no Utah filing occurred within 75 days. | Court held the state court first exercised in rem jurisdiction (Nov. 27, 2016 when notice was served); the later federal warrant/check did not divest state jurisdiction—an invalid federal seizure cannot trump prior state jurisdiction. |
| Remedy / disposition | Savely: district court should compel return / proceed with state forfeiture process. | UHP: contended federal involvement changed jurisdictional priority and supported dismissal. | Court reversed dismissal, ruling state court had in rem jurisdiction and remanded for further proceedings consistent with the opinion. |
Key Cases Cited
- Penn Gen. Cas. Co. v. Pennsylvania, 294 U.S. 189 (1935) (prior in rem jurisdiction by one court yields to that court to avoid conflicting exercises of control over the same res)
- Scarabin v. DEA, 966 F.2d 989 (5th Cir. 1992) (state statutory schemes that place custody/control in courts can confer in rem jurisdiction from seizure/notice)
- United States v. One 1987 Mercedes Benz Roadster, 2 F.3d 241 (7th Cir. 1993) (state statutory vesting of authority over res can support state in rem jurisdiction absent a filing)
- United States v. $490,920 in U.S. Currency, 911 F. Supp. 720 (S.D.N.Y. 1995) (turnover-order requirements and court control over disposition indicate jurisdictional character of state forfeiture scheme)
- United States v. $79,123.49 in U.S. Cash & Currency, 830 F.2d 94 (7th Cir. 1987) (federal seizure after a state court has assumed control is invalid; federal authorities should seek turnover from state court)
- United States v. One 1979 Chevrolet C-20 Van, 924 F.2d 120 (7th Cir. 1991) (unauthorized federal transfer cannot defeat state court’s in rem control; turnover order is proper procedure)
- United States v. One 1985 Cadillac Seville, 866 F.2d 1142 (9th Cir. 1989) (federal courts cannot assume jurisdiction by force where state court already has prior exclusive jurisdiction)
- Industria Nacional del Papel, C.A. v. M/V Albert F, 730 F.2d 622 (11th Cir. 1984) (admiralty example: in rem jurisdiction may attach by operation of law without court filing)