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No. 97-217

IN THE SUPREME COURT OF THE STATE OF MONTANA

 

1998 MT 100

STATE OF MONTANA,

Plaintiff and Respondent,

v.

MICHAEL C. HEGG,

Defendant and Appellant.

APPEAL FROM: District Court of the Sixteenth Judicial District,

 In and for the County of Custer,

 The Honorable Joe L. Hegel, Judge presiding.

COUNSEL OF RECORD:

For Appellant:

Matthew J. Wald; Attorney at Law; Miles City, Montana

For Respondent:

Hon. Joseph P. Mazurek, Attorney General;

Cregg W. Coughlin, Assistant Attorney General;

Helena, Montana

Garry P. Bunke, Custer County Attorney; Miles City, Montana

Submitted on Briefs: February 18, 1998

Decided: April 30, 1998

Filed:

__________________________________________

Clerk

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Justice Terry N. Trieweiler delivered the opinion of the Court.

¶1 The defendant, Michael C. Hegg, was charged in the District Court for

the Sixteenth Judicial District in Custer County with multiple drug-related

offenses, including criminal forfeiture. After the State presented its case at

trial, Hegg moved to dismiss the criminal forfeiture charge. The District Court

denied the motion, and the jury convicted Hegg of all counts. Hegg appeals

the denial of his motion to dismiss. We reverse in part the judgment of the

District Court.

¶2 The sole issue on appeal is whether the District Court erred when it

held that there was sufficient evidence for the jury to have found beyond a

reasonable doubt that Hegg owned or possessed property subject to criminal

forfeiture and denied Hegg's motion to dismiss.

 FACTUAL BACKGROUND

¶3 On July 21, 1995, Montana law enforcement officers searched Michael

Hegg's house in Miles City. The warrant pursuant to which they did so had

been obtained in reliance on a statement from another individual that Hegg

supplied her with drugs.

¶4 The officers found and seized quantities of marijuana,

methamphetamine, and hashish. In addition, they seized $7897 in cash,

numerous loaded guns, a coin collection, a safe, and three scales. They

arrested Hegg that same day.

¶5 On August 21, 1995, Hegg was charged by information with four

counts of felony criminal possession with intent to sell, pursuant to § 45-9-103,

MCA, one count of misdemeanor criminal possession of drug

paraphernalia, pursuant to § 45-10-103, MCA, and one count of felony

criminal forfeiture, pursuant to § 45-9-206, MCA. Two counts of felony

criminal possession with intent to sell were eventually dropped in an amended

information. The criminal forfeiture count alleged that Hegg "knowingly

possessed, owned, used, or attempted to use property that is subject to criminal

forfeiture that was used to facilitate a violation of 45-9-103, and/or intended

for use in manufacturing, preparing, cultivating, compounding, processing,

delivering, importing, or exporting a dangerous drug in violation of 45-9-103,

and/or used as a container for money, raw materials, products, equipment." 

It then listed each item of property, including the cash, coins, scales, safe, and

guns.

¶6 A three-day jury trial was held in January 1996. The State presented

five witnesses, including three officers who were present when Hegg's house

was searched and his property seized, a forensic chemist from the State Crime

Lab, and the individual whom Hegg had supplied with drugs. At the close of

their testimony, Hegg moved to dismiss the count that he criminally possessed

and intended to sell the marijuana found in his possession, based on his

assertion that the State had failed to establish that he intended to sell it, and the

criminal forfeiture count, based on his assertion that the State failed to connect

the property to the drug violations. The District Court denied the motions;

however, it deemed the safe and coin collection withdrawn from the items to

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be forfeited. Hegg presented no witnesses.

¶7 The jury was given a special verdict form that listed each item of

property subject to forfeiture. The jury found Hegg guilty of all counts, and

determined by the special verdict that every item listed should be forfeited. 

The District Court sentenced Hegg to ten years for each felony offense, and

six months for the misdemeanor offense, all of which were to run

concurrently. In addition, the property was ordered forfeited to the State.

 DISCUSSION

¶8 Did the District Court err when it held that there was sufficient

evidence for the jury to have found beyond a reasonable doubt that Hegg

owned or possessed property subject to criminal forfeiture and denied Hegg's

motion to dismiss?

¶9 Pursuant to § 46-16-403, MCA, a district court may, at the close of the

State's case and after a motion from the defendant, dismiss charges against the

defendant if the evidence is insufficient to support a conviction. See § 46-16-403,

MCA. We review a district court's refusal to grant a defendant's motion

to dismiss to determine whether, after viewing the evidence in the light most

favorable to the prosecution, any rational trier of fact could have found the

essential elements of the crime beyond a reasonable doubt. See State v.

Mummey (1994), 264 Mont. 272, 276, 871 P.2d 868, 870. Our review is the

same as when we consider whether sufficient evidence exists to support a

conviction. See State v. Ahmed (1996), 278 Mont. 200, 206, 924 P.2d 679,

683; State v. Richards (1995), 274 Mont. 180, 184, 906 P.2d 222, 224.

¶10 Hegg concedes that there was sufficient evidence to support his

conviction of all counts other than criminal forfeiture. Regarding the

forfeiture count, however, he asserts that the State failed to present any

evidence that the property had been used or that he intended that it be used in

a manner that would violate § 45-9-206, MCA, and that the limited

circumstantial evidence before the jury was insufficient to satisfy the

requirement of a statutory connection between the property and illegal drug

activity. 

¶11 Section 45-9-206, MCA, states:

 (1) A person commits the offense of use or possession of

 property subject to criminal forfeiture if the person knowingly

 possesses, owns, uses, or attempts to use property that is subject

 to criminal forfeiture under this section. A person convicted of

 the offense of use or possession of property subject to criminal

 forfeiture shall be imprisoned in the state prison for a term not

 to exceed 10 years. Upon conviction, the property subject to

 criminal forfeiture is forfeited to the state and must be disposed

 of in accordance with the provisions of 44-12-205 and

 44-12-206.

 (2) The following property is subject to criminal

 forfeiture under this section:

 (a) money, raw materials, products, equipment, and other

 property of any kind that is used or intended for use in

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 manufacturing, preparing, cultivating, compounding, processing,

 delivering, importing, or exporting a dangerous drug in violation

 of 45-9-101, 45-9-103, or 45-9-110 or of 45-4-102 when the

 object of the conspiracy was a violation of 45-9-101, 45-9-103,

 or 45-9-110;

 (b) property used or intended for use as a container for

 property enumerated in subsection (2)(a);

 . . . .

 (d) books, records, research products and materials,

 formulas, microfilm, tapes, and data used or intended for use in

 connection with a violation of 45-9-101, 45-9-103, or 45-9-110

 or of 45-4-102 when the object of the conspiracy was a violation

 of 45-9-101, 45-9-103, or 45-9-110;

 (e) (i) everything of value furnished or intended to be

 furnished in exchange for a dangerous drug in violation of

 45-9-101, 45-9-103, or 45-9-110 or of 45-4-102 when the object

 of the conspiracy was a violation of 45-9-101, 45-9-103, or

 45-9-110; and

 (ii) all proceeds traceable to such an exchange;

 (f) money, negotiable instruments, securities, and

 weapons used or intended to be used to facilitate a violation of

 45-9-101, 45-9-103, or 45-9-110 or of 45-4-102 when the object

 of the conspiracy was a violation of 45-9-101, 45-9-103, or

 45-9-110;

 (g) personal property constituting or derived from

 proceeds obtained directly or indirectly from a violation of

 45-9-101, 45-9-103, or 45-9-110 or of 45-4-102 when the object

 of the conspiracy was a violation of 45-9-101, 45-9-103, or

 45-9-110; and

 . . . .

 (3) A conveyance is not subject to criminal forfeiture

 under this section 

 unless the owner or other person in charge of the conveyance

 knowingly used the conveyance to violate or knowingly

 consented to its use for the purpose of violating 45-9-101,

 45-9-103, or 45-9-110 or of 45-4-102 when the object of the

 conspiracy was a violation of 45-9-101, 45-9-103, or 45-9-110.

 . . . . 

 (5) Property subject to criminal forfeiture under this

 section may be seized under the following circumstances:

 (a) A peace officer who has probable cause to make an

 arrest for a violation of 45-9-101, 45-9-103, or 45-9-110 or of

 45-4-102 when the object of the conspiracy was a violation of

 45-9-101, 45-9-103, or 45-9-110 may seize a conveyance

 obtained with proceeds of the violation or used to facilitate the

 violation and shall immediately deliver the conveyance to the

 peace officer's law enforcement agency, to be held as evidence

 until a criminal forfeiture is declared or release ordered.

 (b) Property subject to criminal forfeiture under this

 section may be seized by a peace officer under a search warrant

 issued by a court having jurisdiction over the property.

 

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 This Court has not yet addressed the applicability of the statute and the 

State's

burden pursuant to it.

¶12 The State contends here that the mere proximity of the guns, cash, and

scales to Hegg's illegal drugs is sufficient evidence to prove that he used or

possessed the items for one of the prohibited purposes. The State concedes

that the evidence is circumstantial and that the jury was forced to infer from

the items' presence in the house and its knowledge of the drug trade that the

guns, cash, and scales facilitated Hegg's illegal drug operation in violation of

§ 45-9-206, MCA. 

¶13 It is well-established that circumstantial evidence is sufficient to prove

any element of an offense and/or to sustain a conviction. See State v. Treible

(1996), 275 Mont. 59, 63, 910 P.2d 237, 239; State v. Mergenthaler (1994),

263 Mont. 198, 204, 868 P.2d 560, 563. It is also well-established that the

State must establish each and every element of an offense by proof beyond a

reasonable doubt. See State v. Fuller (1994), 266 Mont. 420, 422, 880 P.2d

1340, 1342. We have stated that a jury cannot convict a defendant on the

basis of his guilt beyond a reasonable doubt where the evidence only supports

a strong probability, a justifiable suspicion, or a shrewd conjecture that he is

guilty. See State v. Armstrong (1980), 189 Mont. 407, 413, 616 P.2d 341,

345.

¶14 The amended information alleged, pursuant to the forfeiture statute, that

Hegg knowingly possessed, owned, used, or attempted to use property that

facilitated his illegal drug activity. The extent of the State's proof that the

property facilitated the illegal drug activity was evidence that the items were

either in the house or in Hegg's immediate possession. We decline, however,

to affirm a criminal forfeiture conviction based on what amounts to no more

than a justifiable suspicion. The statute does not allow the State to convict a

defendant and seize his property without showing that the property was used

to facilitate or derived from illegal drug activity. Here, the necessary proof has

not been presented.

¶15 None of the witnesses suggested, for example, that the guns were used

to protect his illegal operation or to aid in his delivery of illegal drugs, or that

the cash that was confiscated from his person was traceable to illegal drug

sales, or that the scales reflected the presence of dangerous drugs. They

testified only that multiple loaded guns were found throughout the house, that

the cash was secured in lockboxes in his house and on his person, and that the

scales were located near drugs and drug paraphernalia. We conclude that the

State's suggestion of guilt by association is insufficient to establish beyond a

reasonable doubt that a statutory connection exists between the property and

the drug activity.

¶16 We recognize that guns, ammunition, cash, and scales might, in fact, be

used in connection with an illegal drug operation. However, they are also

common items which many Montanans possess and use for lawful purposes. 

Here, the record reflects that Hegg was employed and that he did not generally

use bank accounts. It also reflects that the kind of scales discovered in Hegg's

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house are used to prepare ammunition or in work with gemstones, both of

which were also found in Hegg's home. Finally, the record suggests that the

majority of the weapons were found in Hegg's bedroom. 

¶17 We recognize that matters of witness credibility and fact-finding are

ultimately within the province of the jury. See State v. Harper (Mont. 1997),

943 P.2d 1255, 1257, 54 St. Rep. 837, 838. But if the evidence, even when

viewed most favorably toward the State, supports no more than a strong

probability or a justifiable suspicion, a jury cannot find guilt beyond a

reasonable doubt and there is insufficient evidence for a conviction. See

Armstrong, 189 Mont. at 413, 616 P.2d at 345.

¶18 In order for the State to criminally convict a citizen and deprive him of

his property pursuant to § 45-9-206, MCA, we hold that it must establish,

whether by direct or circumstantial evidence, a more substantial connection

between such common items as the ones at issue here and illegal drug activity

than merely their proximity to one another in a residence. 

§19 Our decision is compelled by the well-established principle that the

State bears the burden of proving each element of a criminal offense beyond

a reasonable doubt. See Fuller, 266 Mont. at 422, 880 P.2d at 1342. As

applied to the forfeiture offense charged, that principle requires that the State

must prove not only that property has the required statutory connection to

illegal drug activity, but that each specific item of property seized is subject

to forfeiture. 

§20 The history of § 45-9-206, MCA, clearly reflects that when the

Legislature considered the statute, it anticipated that proof beyond a

reasonable doubt would be necessary for conviction or forfeiture. See

Criminal Forfeiture: Hearing on S.B. 229 Before the House Judiciary Comm.,

54th Legislature 24 (March 6, 1995) (statement of Marty Lambert, Gallatin

County Attorney); Criminal Forfeiture: Hearing on S.B. 229 Before the Senate

Judiciary Comm., 54th Legislature 24 (January 30, 1995) (statement of Karen

Townsend, Deputy County Attorney, Missoula County). 

¶21 Prior to the criminal forfeiture statute, a defendant's drug-related

property could only be forfeited pursuant to §§ 44-12-101 to -206, MCA,

which authorize forfeiture based on a probable cause standard and place the

burden on the defendant to rebut the presumption of forfeiture. It is

well-established that a reasonable doubt standard creates a greater burden for the

State than a probable cause standard. See, e.g., United States v. 316 Units of

Mun. Sec. in the Name of Efrain Gonzalez (S.D.N.Y. 1989), 725 F. Supp. 172,

175-76 (because the reasonable doubt burden of proof in criminal cases is

greater than the probable cause burden in civil cases, a criminal acquittal has

no collateral estoppel effect on the government's ability to seek civil forfeiture

for the same conduct that formed the basis of the criminal allegations). In fact,

§ 45-9-206, MCA, was enacted to allow the State to seek forfeiture of

drug-related property criminally and avoid any challenge to the civil forfeiture

statute based on double jeopardy. Accordingly, we recognize the State's

increased burden of proof.

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¶22 We acknowledge that the circumstantial evidence in certain cases may

be sufficient to prove beyond a reasonable doubt that a connection exists

between an item of property and illegal drug activity. However, we conclude

that the kind and amount of circumstantial evidence offered in this case is

insufficient as a matter of law to warrant the jury's finding of guilt beyond a

reasonable doubt. Were we to conclude otherwise and hold that the State need

only identify the presence of certain items in a house to support a jury finding

that the property was subject to forfeiture, we would essentially eliminate the

increased burden and heightened standard of proof in § 45-9-206, MCA, and

permit a jury to convict a defendant based purely on its own speculation as to

what kinds of property might facilitate or be the proceeds of illegal drug

activity. 

¶23 Even on appeal, the State's argument that there was sufficient evidence

to connect the property to illegal drug activity is based not on any legal

authority or evidence regarding the specific items' use in drug activity, but

rather on conjecture about how Hegg's "ramshackle crank house" makes

inevitable the conclusion that he must have used the items for drug activity. 

We specifically reject the State's assertion that "[t]here is no rational

explanation for the [property] except that Hegg used these items in connection

with his drug trade." Even if we view the evidence in a light most favorable

to the State, we disagree with this overstatement of the facts. More

importantly, our criminal system puts the burden on the State to prove that the

items were used in an illegal manner; it is not Hegg's burden to show that they

were used for a lawful purpose.

¶24 Accordingly, we conclude that the jury could not have rationally found

beyond a reasonable doubt that the items satisfied the statutory requirements

of § 45-9-206, MCA, and constituted property subject to criminal forfeiture. 

The District Court erred when it denied Hegg's motion to dismiss on the basis

that there was insufficient evidence for a jury to find beyond a reasonable

doubt that Hegg's property was subject to criminal forfeiture. 

¶25 We reverse in part the judgment of the District Court and order that it

dismiss the criminal forfeiture charge against Hegg. Pursuant to our holding,

we also order the State to return the property seized from Hegg.

 /S/ TERRY N. TRIEWEILER

We Concur:

/S/ J. A. TURNAGE

/S/ WILLIAM E. HUNT, SR.

/S/ W. WILLIAM LEAPHART

/S/ KARLA M. GRAY

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