Court Opinion

ID: 992219
Source: CourtListenerOpinion
Date Created: 2013-07-03 23:48:42.502529+00
Date Added: 2024-06-11T15:25:35.511131
License: Public Domain

UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

UNITED STATES OF AMERICA,
Plaintiff-Appellee,

v.

LEROY RAGIN,
Claimant-Appellant,
                                       No. 94-1970
and

215 PEYTON ROAD S.W., ATLANTA
(DESCRIBED AT DEED BOOK 10344,
PAGE 496, LAND RECORDS OF FULTON
COUNTY, GA)AND $4,290,
Defendant.

Appeal from the United States District Court
for the Western District of North Carolina, at Charlotte.
Graham C. Mullen, District Judge.
(CA-93-165-3-MU)
Submitted: March 10, 1997

Decided: May 21, 1997

Before RUSSELL, WIDENER, and HALL, Circuit Judges.

_________________________________________________________________

Affirmed by unpublished per curiam opinion.

_________________________________________________________________

COUNSEL
Leroy Ragin, Appellant Pro Se. B. Frederic Williams, Jr., OFFICE
OF THE UNITED STATES ATTORNEY, Charlotte, North Carolina,
for Appellee.
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

_________________________________________________________________

OPINION

PER CURIAM:

Leroy Ragin appeals the district court's order adopting the magis-
trate judge's recommendation to deny his motion for extension of
time in which to file a claim of ownership and to grant the govern-
ment's motion for default judgment in his civil forfeiture case. We
grant Ragin leave to proceed in forma pauperis and affirm.
I.

The United States filed a complaint for in rem civil forfeiture of
certain property owned by Leroy Ragin pursuant to 18 U.S.C. § 981
(1994), and 21 U.S.C. § 881 (1994). This property included the real
property located at 215 Peyton Road at issue here. On May 27, 1993,
a lis pendens on this property was filed. Consistent with the law
at
that time, the warrant for arrest in rem had been issued upon an ex
parte demonstration of probable cause before a magistrate judge,
and
Ragin did not have an opportunity to be heard prior to the issue of
the
warrant.

On June 13, 1993 Ragin was served with the complaint, warrant for
arrest in rem, and accompanying orders, and he signed an acknowl-
edgment to that effect. Ragin also has acknowledged that he
received
a "Notice and Acknowledgment of Receipt of Complaint, Warrant for
Arrest In Rem and Order" which in pertinent part stated ". . . you
(or
the party on whose behalf you are being served) must file a claim
within 10 days and answer the complaint within 20 days. If you fail
to do so, judgment by default will be taken against you for the
relief
demanded in the complaint."

The government on July 8, 1993 moved for entry of default given
Ragin's acknowledgment of receipt of service and his subsequent
fail-
ure to file a claim of ownership within the above time limits, as

                                 2
required of him by Rule C(6) of the Supplemental Rules for Certain
Admiralty and Maritime Claims. On that date, default, but not
default
judgment, was entered by the clerk, who recited that as of that day
Ragin had failed to file a claim, answer, or responsive pleading.

Ragin did not file his response to the complaint until August 3,
1993. In that response he neither explained his failure to file a
claim
of ownership nor requested an extension of time.

On September 13, 1993 the government moved for judgment of
forfeiture by default, or in the alternative, judgment on the
pleadings.
On September 23, 1993, Ragin filed a "Motion to File Out of Time"
and a claim of ownership as to the property, 102 days after he
received notice. The claim was unverified. 1

On November 5, 1993 the district clerk's office received from
Ragin a set of documents, with a handwritten letter declaring the
papers to constitute his answer to the motion for default judgment.
The magistrate judge noted that although it appeared the clerk's
office
did not formally accept the submission for filing and tabulating,
the
government responded to it on November 23, 1993.
On January 31, 1994 the magistrate judge filed his decision recom-
mending the denial of Ragin's motion to file his claim out of time
and
the granting of the government's motion for entry of default
judgment
in the forfeiture proceeding. First, the magistrate judge construed
Ragin's motion filed after default as arising under Federal Rule of
Civil Procedure 6(b)(2) (Enlargement of Time), rather than the more
stringent requirements of Rule 55(c) (Setting Aside Default). Rule
6(b)(2) permits a court to exercise its discretion to order an
extension
even after the expiration of a specified time period, but only for
"cause shown" and if the failure to act in a timely fashion was the
result of excusable neglect. The magistrate judge noted that such
a
motion must also comply with the requirements of Rule 7(b)(1) that
the application state with particularity the grounds therefor, and
it
must allege the facts constituting excusable neglect, such that
mere
assertion of excusable neglect unsupported by facts is
insufficient.
_________________________________________________________________
1 We need not and so do not attach significance to the fact that
various
papers of Ragin's were not verified.
3
Fed. R. Civ. P. 7(b)(1). See 4A Wright & Miller, Federal Practice
and Procedure, § 1165 (2d ed. (1987)). The magistrate judge
observed that because Rule 55(c) imposes the additional
requirements
that the party in default act quickly to correct the default and
assert
a meritorious defense to the claim, if Ragin did not meet the
require-
ments of Rule 6(b) (which Rule 55(c) includes), then a fortiori
Ragin
would not satisfy the requirements of Rule 55(c).

As to the second motion, the magistrate judge recommended grant-
ing the government's motion for entry of judgment of forfeiture by
default under Federal Rule of Civil Procedure 55(b)(2) (Default
Judg-
ment by Court). Rule 55(b)(2) allows the court in its discretion to
enter a judgment of default where the party entitled to the
judgment
applies to the court, and if the party against whom it is sought
has
appeared in the matter, that party must be served written notice of
the
application at least three days prior to the hearing on such
application.
Fed. R. Civ. P. 55(b)(2). Finding that Ragin had been properly
served
written notice and, that even in the light most favorable to him,
he had
shown neither good cause or excusable neglect for failing to timely
file his claim of ownership, the magistrate judge recommended
enter-
ing the default judgment. He noted, in weighing the possible
equities,
that if the pro se claimant had advanced even an inchoate basis of
a
meritorious defense, perhaps denial of the motion might be in
order.
However, the magistrate judge found no such defense in Ragin's sub-
mission. Having recommended the granting of the motion for default
judgment, the magistrate judge did not reach the question of
judgment
of forfeiture on the pleadings.

Ragin objected to the magistrate judge's recommendations. On
June 27, 1994 the district court adopted the magistrate judge's
recom-
mendation and entered a judgment of forfeiture by default or alter-
nately judgment of forfeiture on the pleadings.

II.

On December 13, 1993, United States v. James Daniel Good Real
Property, 510 U.S. 43 (1993), established that in civil forfeiture
pro-
ceedings, absent exigent circumstances, Fifth Amendment Due Pro-
cess concerns require the government to provide both pre-seizure
notice and a meaningful opportunity to be heard. We applied this
rule

                                4
in the case of Ragin's aunt, United States v. Marsh, 105 F.3d 927
(4th
Cir. 1997), and found that in that case, the remedy for a
forfeiture pro-
ceeding in which real property was seized without a pre-seizure
hear-
ing was a government accounting for the seizure of the rents
derived
from the property seized during the period of illegal seizure. 105
F.3d
at 931.

In Marsh we noted that insofar as the case was still on direct
appeal
when the rule in Good was announced, the claimant was not pre-
cluded from availing herself of that rule. Marsh , 105 F.3d at 931
(citing Harper v. Virginia Dep't of Taxation , 509 U.S. 86, 96-97
(1993)). However, the judgment of forfeiture in Ragin's case
differs
from Marsh in that here the judgment resulted from Ragin's failure
to timely file a claim of ownership, and the consequent entry of
default judgment.

Rule C(6) of the Supplemental Rules for Certain Admiralty and
Maritime Claims governs the time requirements for filing a claim in
forfeiture proceedings. It provides in relevant part:
     (6) Claim and Answer; Interrogatories. The claimant of
     property 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 filing the
     claim.
It is well established that before a claimant in a forfeiture case
can file
an answer and defend on the merits, the claimant must file a claim
of
ownership. In the absence of a timely filed claim, the claimant
lacks
standing to contest a forfeiture. United States v. One Urban Lot,
978
F.2d 776, 778 (1st Cir. 1992); United States v. $38,570 U.S.
Currency, 950 F.2d 1108, 1114-15 (5th Cir. 1992); United States v.
Currency in the Amount of $2,857.00, 754 F.2d 208, 212-13 (7th Cir.
1985); United States v. Properties Described in Complaints, 612 F.
Supp. 465 (N.D. Ga. 1984), aff'd, 779 F.2d 58 (11th Cir. 1985)
(table).

Ragin acknowledged that he was served with the complaint and

                                 5
warrant for arrest in rem on June 13, 1993. 2 As of July 8, 25 days
later, Ragin had filed neither a claim nor any other response.
Conse-
quently, the government requested a default pursuant to Rule 55(a),
and the clerk properly entered the default on the same date. Ragin
still
did not respond until August 3, and this filing, some 51 days after
he
was served with the complaint did not include a claim of ownership
and did not explain his failure to file one. Rather, in it Ragin
merely
recited a baseless claim that the forfeiture proceeding was the
result
of a government conspiracy against him.
Pursuant to Rule 55(b) the government, on September 13, 1993,
filed its motion for default judgment. Because the judgment
involved
the forfeiture of a res, and not a sum certain, the motion was
properly
made to the court under Rule 55(b)(2), rather than to the clerk
under
55(b)(1). F. R. Civ. P. 55(b). Subsequently, on September 23, Ragin
filed an unverified claim of ownership, along with a motion to file
out
of time. This was 102 days after June 13, 1993, the date as of
which
Ragin acknowledged service of the warrant for arrest in rem. A
review of the filings reveals that Ragin's only explanation for his
fail-
ure to timely file a claim was that he says he mistakenly believed
that
signing the Acknowledgment of Receipt constituted filing a claim,
_________________________________________________________________
2 The complaint, warrant for arrest in rem, and accompanying orders
were mailed to Ragin pursuant to the then existing Federal Rule of
Civil
Procedure 4(c)(2)(C)(ii). That rule provided for service of process
by
"the mailing of a copy of the summons and of the complaint (by
first-
class mail, postage pre-paid) to the person to be served, together
with
two copies of a notice and acknowledgment conforming substantially
with form 18-A and a return envelope, postage pre-paid, addressed
to the
sender." F. R. Civ. P. 4(c)(2)(C)(ii) (West 1993). The notice the
govern-
ment submits as the one it sent to Ragin is styled after form 18-A,
as is
the Acknowledgment of Receipt Ragin signed. While the record does
not
indicate the manner of mailing, there is no doubt that Ragin
received the
service and had actual notice of the forfeiture proceedings.

We have held that "the real purpose of service of process is to
give
notice to the defendant that he is answerable to the claim of the
plaintiff"
and that "where actual notice of the commencement of the action and
the
duty to defend has been received by the one served," service under
Rule
4(d) "should be liberally construed to effectuate service and
uphold the
jurisdiction of the court . . . ." Karlsson v. Rabinowitz, 318 F.2d
666,
668-669 (4th Cir. 1963).

                                 6
due to an alleged ambiguity in the wording of the Acknowledgment
of Receipt. However, we find the explanation of the ten-day rule
con-
tained in the Acknowledgment of Receipt to be both accurate and
unambiguous.

Accordingly, Ragin having failed to file his claim until 102 days
after required service, and the district court within its
discretion hav-
ing refused to accept the claim filed out of time, Ragin lacked
stand-
ing to challenge the forfeiture. One Urban Lot , 978 F.2d at 778;
United States v. $38,570 U.S. Currency, 950 F.2d at 1114-15. Stand-
ing being a jurisdictional requirement, and because Ragin lacked
standing, the court did not have jurisdiction to enter an order as
to the
merits of the forfeiture at the instance of Ragin.

Additionally, even though the court's final order, that Ragin
lacked
standing, was not entered until its judgment on June 27, 1994,
which
was after Ragin contended that Good applied, any orders by the
court
giving relief under Good before the judgment would have been void
following such a final judgment finding no jurisdiction to
entertain
Ragin's claims. See United Catholic Conference v. Abortion Rights
Mobilization, Inc., 487 U.S. 72, 76 (1988) (finding that where
district
court lacked jurisdiction over the underlying matter the issuance
of a
subpoena was void and order of civil contempt based on refusal to
honor the subpoena required reversal).
We recognize that one case has required an accounting for rents
under Good even though the forfeiture resulted from a default judg-
ment. See United States v. 51 Pieces of Real Property Roswell N.M.,
17 F.3d 1306, 1316 (10th Cir. 1994) (requiring accounting for rent
collected where judgment of forfeiture followed entry of default
judg-
ment in favor of government). In 51 Pieces, however, the court held
there was no jurisdiction over the real estate because of process
sent
outside the State, a condition not appertaining here, so that case
is not
inconsistent with our decision.

Of course, the district court could have granted Ragin's motion to
file outside the ten-day deadline for filing a claim. That is a
decision
which we review for abuse of discretion. One Urban Lot, 978 F.2d
at 777; United States v. Borromeo, 945 F.2d 750, 753-54 (4th Cir.
1991). Whether a claimant's circumstances constitute excusable

                               7
neglect under Rule 6(b)(2) "is equity ridden, and the peculiar
facts of
each case involve different equities." Borromeo, 945 F.2d at 753.
We
are of opinion that the district court did not abuse its discretion
in
finding that Ragin did not show his delay was due to excusable
neglect. The equities here plainly are on the side of the
government.
Likewise, we agree that where Ragin could not meet Rule 6(B)(2)'s
standard of excusable neglect, he could not get relief under Rule
55(c), owing to its additional requirements of quick remedial
action
and a meritorious defense.

III.

In conclusion, where Ragin's claim of ownership and answer were
not timely filed, the district court acted within its authority in
entering
a judgment of forfeiture by default. Ragin's failure to file a
timely
claim of ownership deprives him of standing to challenge the
forfei-
ture.

We therefore affirm the district court's order adopting the magis-
trate judge's recommendation and entering a judgment of forfeiture
in favor of the government. We dispense with oral argument because
the facts and legal contentions are adequately presented by the
materi-
als before the court and argument would not aid the decisional pro-
cess.

AFFIRMED
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