UNITED STATES of America, Plaintiff-Appellant, v. CERTAIN REAL PROPERTY LOCATED AT 2525 LEROY LANE, WEST BLOOMFIELD, MICHIGAN, and Leah Liza Marks, Defendants-Appellees.
No. 88-2238
United States Court of Appeals, Sixth Circuit
Argued Sept. 21, 1989. Decided Aug. 8, 1990.
343
Where I finally have come to agree with the majority has been in my realization that no particular deference is due to the Board‘s alter ego conclusion to the extent that it answers a question of law beyond the Board‘s expertise. Unlike purely factual conclusions by the Board, this conclusion is not entitled to deference on appeal. See Seafarers Local 777 v. NLRB, 603 F.2d 862, 869 n. 17, 872 (D.C.Cir.1978) (special deference accorded to the Board‘s legal conclusions on questions of law under the
I therefore conclude that we are free to examine the entire transaction and to decide for ourselves upon the record that the corporate history of the several companies owned and operated by the respondents was proper and in accordance with normal precepts of American corporation law in general and the federal common law in particular. Having recognized this, I simply have to conclude that the record does not support a conclusion that there was an abuse of the corporate form. Any conjecture that the Mills harbored some undisclosed intent to gain a labor advantage out of that corporate structure far in the future is speculative, subjective, and insufficient to upset the conclusion that the respondents did precisely what the law permitted them to do. In fact, no more has been proved in this case than that. Accordingly, I concur.
Martin W. Bordoley, Southfield, Mich., Martin S. Baum, Colista, Adams, Dettmer & Palmer, Detroit, Mich., Stephen J. Bock (argued), Liberson, Bloom, Bloom & Bock, Southfield, Mich., for defendants-appellees.
Before MERRITT, Chief Judge, KRUPANSKY, Circuit Judge, and GRAHAM, District Judge.*
GRAHAM, District Judge.
This is an appeal by the Government from a judgment of the United States District Court for the Eastern District of Michigan awarding the entire proceeds from the sale of property seized pursuant to
On February 26, 1987, an indictment was returned in the Eastern District of Michigan against Mitchell Dennis Marks. The indiсtment charged Mitchell Marks with
Mr. Marks was convicted by a jury and a judgment order imposing sentence was filed on June 6, 1988. The judgment also ordered the forfeiture of Mr. Marks’ interest in the real property. On July 15, 1988, Leah Liza Marks, claimant-appellee and wife of Mitchell Marks, filed a petition in the criminal case for a determination of her interest in the real property, as well as a claim to the property.
In the interim, on April 17, 1987, the Government filed a civil complaint for forfeiture pursuant to
In the proceedings before the district court, the parties stipulated that the real property known as 2525 Leroy Lane was owned by Leah Marks with her husband, Mitchell Marks, as tenants by the entirety. By agreement of the parties dated April 29, 1988, the real property was sold and the proceeds of the sale were designated as a substitute res in which the parties were deemed to have the same interest as they had in the real estate. The Government and Leah Marks also entered into a stipulation of facts on November 2, 1988, in which the Government agreed that Leah Marks was an “innocent owner” within the meaning of the forfeiture provisions.
By order entered on November 7, 1988, the district court awarded judgment to claimant Leah Marks. The district court concluded that Leah Marks had a legal interest in the property “rather than” her husband for purposes of
The Government proceeded in this case under both the criminal and civil
(a) Property subject to criminal forfeiture
Any person convicted of a violation of this subchapter or subchapter II of this chapter punishable by imprisonment for more than one year shall forfeit to the United States, irrespective of any provision of State law—
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(2) any of the person‘s property used, or intended to be used, in any manner or part, to commit, or to facilitate the commission of, such violation, . . .
The term “property” in this section includes real property.
the petitioner has a legal right, title, or interest in the property, and such right, title, or interest renders the order of forfeiture invalid in whole or in part because the right, title, or interest was vested in the petitioner rather than the defendant or was superior to any right,
title, or interest of the defendant at the time of the commission of the acts which gave rise to the forfeiture of the property under this section . . .
The provisions for civil forfeiture are found in
All real property, including any right, title, and interest (including any leasehold interest) in the whole of any lot or tract of land and any appurtenances or improvements, which is used, or intended to be used, in any manner or part, to commit, or to facilitate the commission of, a violation of this title punishable by more thаn one year‘s imprisonment, except that no property shall be forfeited under this paragraph, to the extent of an interest of an owner, by reason of any act or omission established by that owner to have been committed or omitted without the knowledge or consent of that owner.
The criminal forfeiture provisions of
The Government‘s first argument on appeal is that Leah Marks lacks standing under
At the time of the illegal acts which rendered the real property subject to forfeiture, Leah Marks and her husband owned the real property as tenants by the entirety under Michigan law. Tenants by the entirety, who must be husband and wife, hold under a single title with right of survivorship. Matter of Grosslight, 757 F.2d 773 (6th Cir.1985); Sanford v. Bertrau, 204 Mich. 244, 169 N.W. 880 (1918). Neither husband nor wife acting alone can alienate any interest in the property, nor can the creditors of one levy upon the property. Matter of Grosslight, 757 F.2d at 775.
A husband and wife holding by the entireties do not hold as joint tenants. “A joint tenancy implies a seisin per my et per tout, while an estate in entirety implies only a seisin per tout.” In Re Appeal of Lewis, 85 Mich. 340, 341, 48 N.W. 580 (1891).
A Michigan court in Rogers v. Rogers, 136 Mich.App. 125, 356 N.W.2d 288, 292-93 (1984) described the entireties estate as follows:
In Michigan real property law, tenancies by the entireties enjoy an ancient and hoary tradition. The usual and durable method for a husband and wife to hold real estate has been as tenants by the entireties. The classic basis for a tenancy by the entireties was the concept that “the husband and wife are but one person in the law“. In a true tenancy by the entireties, each spouse is considered to own the whole and, therefore, is entitled to the enjoyment of the entirety and to survivorship. When real property is so held as tenants by the entireties, neither spouse acting alone can alienate or encumber to a third person an interest in the fee of lands so held. Neither the husband nor the wife has an individual, separate interest in entireties property, and neither has an interest in such property which may be conveyed, encumbered or alienated.
One incident of an estate by the entireties is that the survivor, whether husband or wife, is entitled to the whole and such right cannot be defeated by a conveyance by one spouse to a stranger. Traditionally, tenancies by the entireties could only be created by a written instrument of conveyance, which produced
unity of persons, time, title, interest and possession. (Footnotes omitted).
Thus, under Michigan law, Leah Marks had not only an indivisible interest in the entireties property, but also a survivorship interest which would entitle her to sole ownership of the property upon her husband‘s death. Rogers, 356 N.W.2d at 293. Her survivorship interest constitutes a legal interest in the real property which was vested in her “rather than the defendant” for purposes of
The remaining issues presented by the Government‘s appeal concern the impact of the forfeiture statutes on Leah Marks‘s interest in the real property. The Government has stipulated that Leah Marks is an innocent owner within the meaning of those provisions. However, the Government contends that she is entitled, at most, to one half of the proceeds from the sale of the property.
A central question presented by this case is the role which should be accorded state law in the federal forfeiture scheme. The Government argues that state property law should not be determinative, but rather that the federal courts should develop a federal common law of forfeiture to govern the treatment of property interests. The United States Supreme Court has recognized the authority of the federal courts to create consistent nationwide rules in the face of confliсting state laws. See Clearfield Trust Co. v. United States, 318 U.S. 363, 63 S. Ct. 573, 87 L. Ed. 838 (1943). However, a nationwide rule may not be appropriate where Congress has not specifically adopted a federal rule of law, and where the incorporation of state law as the federal rule of decision will not hinder the administration of a federal program. United States v. Kimbell Foods, Inc., 440 U.S. 715, 99 S. Ct. 1448, 59 L. Ed. 2d 711 (1979).
In United States v. Yazell, 382 U.S. 341, 86 S. Ct. 500, 15 L. Ed. 2d 404 (1966), the Supreme Court addressed the application of Texas property law to an action to obtain judgment on a Small Business Administration loan. Under Texas law, the respondent wife of the business owner and co-signer of the loan note was deemed to lack the capacity to contract with the Small Business Administration, and thus she could not be held liable for the note. The Supreme Court recognized that state law could be overridden where federal programs or actions must be uniform throughout the United States, as in the case of Clearfield Trust Co., supra, which involved the remedial rights of the United States with respect to federal commercial paper. Yazell, 382 U.S. at 354, 86 S. Ct. at 507-08. The court in Yazell went on to note that the single loan transаction was not a nationwide act of government warranting the adoption of a uniform rule of law. Id., 382 U.S. at 348, 86 S. Ct. at 505. Likewise, state law rules have been adopted as the federal law to be applied despite the consequent diversity in the rights and obligations of the United States in the various states. Id., 382 U.S. at 354-57, 86 S. Ct. at 507-09. Finally, the Court held that in the absence of specific congressional action, state laws governing family property arrangements would be overridden by federal courts only where clear and substantial interests of the national government, which cannot be served consistently with respect for such state interests, will suffer major damage if the state law is applied. Id., 382 U.S. at 348-52, 86 S. Ct. at 504-07.
As noted above, the Government proceeded in this case under both the civil and criminal forfeiture provisions in
In interpreting the criminal forfeiture scheme, we must reconcile the apparent clash of
By drafting this forfeiture statute to operate “irrespective of any provision of State law,” it would at first appear that Congress supрlanted, albeit inadvertently, state-determined property rights with a case-by-case development and application of a federal common law of property whenever state property laws seems to limit the Government‘s absolute access to assume ownership of property by forfeiture. But rather than read the language of
Under
the petitioner has a legal right, title, or interest in the property, and such right, title оr interest was vested in the petitioner rather than the defendant or was superior to any right, title, or interest of the defendant at the time of the commission of the acts which gave rise to the forfeiture of the property under this section . . . (emphasis added).
Only a strained reading would permit us to infer that
The Government argues that a federal common law of forfeiture is needed to effectuate the goals and purposes of the federal forfeiture scheme. Forfeiture statutes serve the ends of law enforcement by preventing further illicit use of the property and by imposing an economic penalty, thereby rendering illegal behavior unprofitable. Calero-Toledo v. Pearson Yacht Leasing Co., 416 U.S. 663, 687, 94 S. Ct. 2080, 2094, 40 L. Ed. 2d 452 (1974). The drug forfeiture provisions aid law enforcement efforts in the area of illegal drugs. United States v. One 1977 Cadillac Coupe DeVille, 644 F.2d 500 (5th Cir.1981).
The Government suggests that drug dealers will circumvent the impact of the forfeiture statutes by investing their assets in property such as entireties property which may be shielded from forfeiture by reason of the nature of the property interest under state law. However, such evasive actions would be undermined by the heavy burden placеd upon claimants to prove their innocent ownership status.
In addition, forfeiture statutes are intended to impose a penalty only upon those who are significantly involved in a criminal enterprise. United States v. United States Coin & Currency, 401 U.S. 715, 721, 91 S. Ct. 1041, 1044-45, 28 L. Ed. 2d 434 (1971). Here, a penalty has been imposed upon Mr. Marks, who has forfeited his interest in the property. The protection of the interest of an innocent owner as that interest is defined under state law is not inconsistent with federal forfeiture policy. The dissenting opinion notwithstanding,
Each forfeiture proceeding is based upon unique circumstances. Forfeiture proceedings implicate property rights which have traditionally been measured in terms of state law. Yazell, supra. The forfeiture provisions of
The remaining issues concern the effect of the forfeiture provisions on the entireties interest of Leah Marks under Michigan law. We must determine what interest Mrs. Marks retains in the property and what interest the Government gains in the property as the result of the forfeiture of Mr. Marks‘s interest. The Government relies on various theories to support its position that the Government should recover at least one half of the property. The Government cites United States v. Rodgers, 461 U.S. 677, 103 S. Ct. 2132, 76 L. Ed. 2d 236 (1983) as being analogous to this case. Rodgers involved the impact of
In contrast to the statute involved in Rodgers, the in rem provisions of
The Government relies on United States v. One Parcel of Real Estate, 715 F.Supp. 355 (S.D.Fla.1989), where the court reasoned that the Government became co-owner of the property by reason of the relation back vesting provision,
Under the reasoning in One Parcel of Real Estate, the Government would assume ownership of the entire property at the commission of the illegal act, thereby terminating the entireties estate. However, this interpretation of the forfeiture statutes operates to reduce what would otherwise be the spouse‘s interest in the entire property under state law. Under
The criminal forfeiture statute also has a relation back provision which vests title of the property in the United States upon the commission of the illegal act. See
Reading the forfeiture statutes as a whole, there is no indication that Congress intended that the relation back provisions deprive an owner of part or all of his or her entireties interest in property acquired prior to the commission of the illegal acts. We conclude that the relation back provision of
The Michigan law previously discussed indicates that Leah Marks has an indivisible interest in the whole property held by the entireties. Under Michigan law, the individual interest of a tenant by the entirety is the functional equivalent of a life estate with a right of survivorship. The
If the marriage terminates in divorce, the entireties estate is converted into a tenancy in common by operation of statute. See
We find that Lewis v. Homeowners Insurance Co., 172 Mich.App. 443, 432 N.W.2d 334 (1988), relied upon by the Government, has no impact upon the entireties estate in this case. In Lewis, the court held that the wife could recover half of the insurance proceeds after the entireties property was destroyed through arson committed by her husband. However, the result in that case was reached through an interpretation of the insurance contract, and was not based on the nature of the wife‘s interest in the property.
In light of the parties’ stipulation to treat the cash proceeds of the forced sale as though they retained the same qualities as entireties property, the Government may properly acquire only the interest which Mr. Marks held as cotenant by the entireties. However, the Government cannot occupy the position of Mr. Marks in the entireties estate, since the estate is founded on marital union, and the Government obviously cannot assume the role of spouse to Mrs. Marks. By acquiring Mr. Marks‘s interest in the entireties estate, the Government is precluded from obtaining Mr. Marks‘s interest in the property unless and until Mrs. Marks predeceases her husband or the entireties estate is otherwise terminated by dissolution of the marriage or joint conveyance. However, we do not agree with the district court‘s finding that the entire property vested in Mrs. Marks by reason of the forfeiture. Instead, we conclude that the interest acquired by the Government is most analogous to the position occupied by a judgment creditor of one spouse under Michigan law.
The exact nature of the parties’ rights would be more readily determinable if the real property here had not been sold. Mrs. Marks would be entitled to live in the house during the duration of the tenancy, and the Government would have a lien on the property to the extent of the value of Mr. Marks‘s interest which would prevent Mrs. Marks from obtaining the entire proceeds upon the sale of the property. Here, the real property has been sold, and the district court must determine on remand how to manage the fund of money in such a way as will protect the Government‘s interest as a judgment creditor, while at the same time permitting Mrs. Marks the use of that property consistent with her interest as a tenant by the entireties.
We note that during the pendency of this appeal, the judgment of the district court in United States v. One Single Family Residence, 699 F.Supp. 1531 (S.D.Fla.1988) was affirmed by the Eleventh Circuit Court of Appeals. See United States v. One Single Family Residence, 894 F.2d 1511 (11th Cir.1990). The Eleventh Circuit determined that under Florida law, the interest of the innocent spouse in entireties property was not subject to forfeiture by reason of the criminal activity of her husband, and that federal law as contained in
Nothing would prevent the government from attempting to execute or levy on its interest should the entireties estate be
altered by changes in circumstances or by court order. That is, we do not rule out the possibility that if the United States filed a lis pendens against the property, the government might acquire in a later forfeiture proceeding Mr. Aguilera‘s interest in the property should he divorce his spouse, should Mrs. Aguilera predecease him, or should their interests be transmitted into some divisible form by their actions or by law. In such case, their interests would become distinct and separable so that forfeiture of his interest in the property would not affect her rights.
Our opinion in the present case is consistent with the conclusions reached by the Eleventh Circuit. The distinguishing feature in the case before the Eleventh Circuit is that the real property in question had not been sold, and therefore whatever future interest the Government might have in the property would be protected by the filing of a lis pendens. Here, however, the real property has been converted to a fund of money which could easily be dissipated. Therefore, it becomes necessary in this case to hold the money in escrow, thereby establishing in effect a lis pendens in order to protect the Government‘s interests in anticipation of the occurrence of some event which may result in the vesting of the Government‘s interest in the proceeds of the property.
While we leave the determination of the precise scope of the Government‘s interest under Michigan law to the district court, we note some cases which may be instructive. As previously noted, the judgment creditors of one spouse may not levy against entireties property through a forced sale. Matter of Grosslight, 757 F.2d at 773. The creditors of the husband alone cannot reach the husband‘s share of proceeds from a foreclosure sale of the entireties real estate, Muskegon Lumber & Fuel Co. v. Johnson, 338 Mich. 655, 62 N.W.2d 619 (1954), or rents from property held by the entireties, Peoples State Bank of Pontiac v. Reckling, 252 Mich. 383, 233 N.W. 353 (1930); Battjes Fuel & Bldg. Material Co. v. Milanowski, 236 Mich. 622, 211 N.W. 27 (1926). However, although Michigan law precludes a forced sale of property to enforce a judgment lien, we have found no cases which would preclude the attachment of a creditor‘s lien on one spouse‘s interest which could be satisfied to the extent of that spouse‘s interest upon the termination of the entireties estate. Each tenant by the entirety is entitled to share equally in the rents and profits derived from the entireties property. Thus, it may be that Mrs. Marks would be entitled to half of the interest from the fund of money. Consistent with the prohibition against unilateral alienation of the entireties property by one tenant, Mrs. Marks would not be able to reach her share of the principle of the fund unless or until the entireties estate terminated through the death of Mr. Marks, upon which she would be entitled to the entire fund, or through other termination of the entireties estate, at which time Mrs. Marks would be entitled to one half of the fund. The Government would be entitled to the entire fund if Mrs. Marks predeceased Mr. Marks, and to one half of the fund upon some other termination of the estate such as a termination of the marriage or an agreement between Mrs. Marks and the Government to terminate the tenancy.
We likewise leave to the discretion of thе district court the determination of how to best manage and invest the fund in such a way as to protect the interests of both Mrs. Marks and the Government.
Of course the parties are entitled to compromise and settle their respective interests by agreeing among themselves upon a division of the fund. Because Mr. Marks‘s interest in the property has been forfeited to the Government, the interested parties for purposes of settlement are the Government and Mrs. Marks. The court would commend to the parties the services of its settlement office under the supervision of Mr. Robert Rack, who may be able to assist the parties in effectuating a fair settlement and a fair division of the fund of money in question.
For the foregoing reasons, the judgment of the district court is hereby vacated, and this case is remanded to the district court
KRUPANSKY, Circuit Judge, dissenting.
The majority, in ruling that the government becomes, in effect, a judgment creditor against the entireties estate of Mitchell and Leah Marks (appellee) by virtue of Mitchell‘s conviction for a narcotics offense, ignores the compelling public interest underlying the federal criminal penalty of forfeiture intended by Congress as an immediate, certain, and severe deterrent of uniform implementation calculated to curb the cascading nationwide drug trade. The majority‘s result, which by operation of law converts the government-forfeitor into a life-long judgment creditor of the defendant-forfeitor, suspends the ultimate resolution of rights as compelled by the forfeiture pending the death of one of the spouses. While this may be the accommodation that has been achieved at state law between the customary rights of a judgment creditor seeking enforcement of a judgment and the traditional insulation of the entireties estate from the debts of a single spouse, it finds no support in either the federal criminal or civil forfeiture provisions,
The government argues persuasively that the overwhelmingly coercive policies of criminal and civil forfeitures would be critically eroded if the efficacy of forfeiture orders were made to depend upon disparate state property laws. The majority‘s disposition—which represents an overweening solicitude for state property law—amounts to a public announcement to criminal defendants that their property will be subjected to a wide disparity of treatment in different states, and that, therefore, the penal consequences of their conduct will vary from jurisdiction to jurisdiction, despite their violation of federal laws.1 The better result is to preempt state law with a federal common law of forfeiture whenever, as here, the property interest of the innocent third party is defined by state law with less than certainty.
In reaching its disposition, the majority relies heavily on the absence of express language in
“The starting point in every case involving construction of a statute is the language itself.” Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723, 756, 95 S. Ct. 1917, 1935, 44 L. Ed. 2d 539 (1975) (Powell,
This is not a case where the statute readily provides an answer to the question. Accordingly, the court must look beyond the language of the statute and resort to traditional tools of statutory construction. The majority concededly undertakes a serious effort to interpret the forfeiture statute, but in doing so completely ignores the paramount congressional interest in effectuating a uniform, immediatе, certain, harsh and efficacious sanction against those who elect to profit from a venture as pernicious as trading in drugs. In reaching this result, the majority‘s sole reference point extrinsic to
Logic dictates that the most reasonable source of outside guidance inheres in the persuasive policies underlying federal forfeiture schemes.2 Where the federal policies in favor of a given result are overpowering, and the countervailing state rule of law so imperfectly defined, logic and sound judgment direct the evolution of a federal common law addressing the disposition of forfeited marital property which preempts contrary provisions of the myriad spousal estates recognized in the various states. The Supreme Court has not—as the majority opinion would imply—rendered state domestic property law insusceptible to the traditional principles under which federal law is given preemptive effect:
These principles are not inapplicable here simply because real property law is a matter of special concern to the States: “The relative importance to the State of its own law is not material when there is a conflict with a valid federal law, for the Framers of our Constitution provided that the federal law must prevail.” Free v. Bland, 369 U.S. 663, 666, 82 S. Ct. 1089, 1092, 8 L. Ed. 2d 180 (1962).
Federal criminal forfeiture policies demand that defined property of Mitchell Marks, the convicted narcotics dealer, be subject to the sanction of forfeiture. Solicitude for appellee‘s interests as an innocent spouse counsels against completely divesting her of her interest in the property. The statute, inconsistently perhaps, mandates both that state law not interfere with forfeiture and that state law be consulted to define the rights that must be preserved in third parties. When, as in this case, state law defines these rights ambiguously, it stands to reason that a preemptive federal common law be developed to define the rights resulting from the guilty spouse‘s conviction with certainty, immediacy, and some degree of spontaneous penal force.
This may seem harsh, but the compelling nature of these policies and the likelihood and acceptability of severe results has been underscored and approved in two recent decisions of the Supreme Court in which the forfeiture provisions were upheld against constitutional challenges. United States v. Monsanto, — U.S. —, 109 S. Ct. 2657, 105 L. Ed. 2d 512 (1989); Caplin & Drysdale, Chtd. v. United States, — U.S. —, 109 S. Ct. 2646, 105 L. Ed. 2d 528 (1989). In the Monsanto case the Court rejected the argument that assets which an accused had designated for the retention of legal counsel of his choice were implicitly excepted from the statute‘s enumeration of forfeitable property. The Court admitted that the plain meaning of the statute could conceivably result in “harsh” consequences, making it difficult if not impossible for the accused to retain the counsel of his choice—possibly forcing resort to court-appointed counsel—but that the forfeiture statute “mandates” such harsh results. 109 S. Ct. at 2665.5
In the companion Caplin & Drysdale case, the Court addressed substantially the same issue in constitutional terms, concluding that, under the sixth amendment, a criminal defendant could be deprived of assets intended for the retention of legal counsel of his choice. In language that affirmed in no uncеrtain terms the paramount character of the policies underlying the federal forfeiture provisions, the Court concluded “that there is a strong governmental interest in obtaining full recovery of all forfeitable assets, an interest that overrides any Sixth Amendment interest in permitting criminals to use assets adjudged
Accordingly, I would conclude that absent meaningful language in the statute to the contrary, it was certainly erroneous for the district court in the case at bar to award an innocent spouse a full, unencumbered fee simple interest in the property. Such a gift constitutes a windfall, conferring on the innocent spouse more than she had before her husband exposed the property to forfeiture by engaging in his illicit drug enterprise. It is equally in error for the panel majority to place the government in the position of a life-long judgment creditor, thus holding realization of its rights, and of the rights of the spouse, in abeyance pending the demise of one of the parties to the marital relatiоnship. Moreover, the majority places upon the district court not only the burden of formulating a plan for the investment and management of the res over a protracted period of time, but also the time-consuming burden of monitoring the fund in a fiduciary capacity for the balance of the Marks‘s lives.
In support of its conclusions, the panel majority cites to a footnote in the Eleventh Circuit‘s recent opinion in United States v. One Single Family Residence, 894 F.2d 1511 (11th Cir.1990), in which that court under circumstances somewhat similar to those presented in the case at bar conjectured that the government could “file[] a lis pendens against the property” noticing the public of an inchoate, undefinable potential cloud on title to the property. See id. at 1516-17 n. 6. This is a forfeiture in name only, devoid of practical consequence. The forfeiture in One Single Residence was nominal because, as the majority fails to note, the decision awarded the entire estate to the innocent spouse, and the reference to the recording of a lis pendens was, in essence, a palliative sop to the government. Specifically, the Eleventh Circuit, invoking convoluted reasoning, concluded that the innocent spouse in an entireties estate stands to lose nothing in the wake of the defendant spouse‘s conviction, because her interest in the estate theoretically extended to the entire property. Conveniently ignoring the very tangible ownership interest of the convicted spouse (which, too, extended to the entire property), the Eleventh Circuit concluded that “no interest exist in the subject property which can be forfeited to the government . . .” Id. at 1516. The district court in the case at bar, treating the proceeds from the sale of the subject property as a substitute res, arrived at the same conclusion as the Eleventh Circuit in One Single Family Residence, yet the majority disposition in the instant case vacates the district court‘s judgment. Thus, the majority inconsistently expresses approval of the Eleventh Circuit‘s resolution of the issue confronting this appeal, yet reverses the district court‘s disposition. Moreover, the Eleventh Cirсuit‘s lis pendens obiter, as does the majority disposition herein, effectively places a final resolution of the real property rights between the owners of the entireties estate and the government in abeyance pending divorce or death. It is also relevant to note that the Eleventh Circuit‘s suggestion that the government record a lis pendens constitutes a resolution that is even more indefinite and uncertain than the majority‘s disposition herein.
The equitable resolution of the uncomfortable conflicts exposed in this case is neither a judgment lien nor a lis pendens, but rather a severance of the entireties estate in favor of a flexible tenancy in common between appellee and the government. At once, this solution serves the overriding national need for immediacy, certainty, uniformity, and efficacy in forfeiture, equitably mitigates the pain that appellee must inevitably suffer in the wake of her husband‘s criminal transgressions, and resolves the matter with the immediacy, сertainty, and finality that is to be expected in the wake of a criminal conviction.
I would, for the reasons expressed herein, reverse the district court and remand the case for final disposition not inconsistent with this opinion.
JAMES L. GRAHAM
UNITED STATES DISTRICT JUDGE