Court Opinion

ID: 8891367
Source: CourtListenerOpinion
Date Created: 2022-11-26 23:17:42.013928+00
Date Added: 2024-06-11T17:07:14.187913
License: Public Domain

TIMBERS, Circuit Judge, joined by LUMBARD, Circuit Judge,
(concurring) :
I concur in the judgment of the Court and in the opinion of Judge Wyzanski to the extent that they reverse the order of the district court dismissing the complaint and remand for trial on the issue of the constitutionality of the sale provisions of the New York Lien Law as applied to the sale of appellant’s automobile. I would go further, however, and state what I believe to be the applicable constitutional principles. Indeed, I would direct the district court to declare the sale provisions unconstitutional as applied if appellant is able to prove his allegations.
Like Judge Wyzanski, in my view the key question raised by this complaint is whether the summary sale procedure provided for in N.Y. Lien Law § 200, et seq. (McKinney Supp. 1972) passes constitutional muster. While I agree that if appellant can prove the facts outlined in Judge Wyzanski’s opinion, appellant will have “a tenable contention that Section 204 of the New York Lien Law as applied here was repugnant to the due process clause of the Fourteenth Amendment”, I think the issue is so important and close as to warrant more guidance from us to the district court.
On the issue of the statute’s detention provision, N.Y. Lien Law § 184 (McKinney Supp. 1972), I agree with Judge Wyzanski that appellant’s claim is no longer justiciable, but for somewhat different reasons.
I.
The district court, in holding that due process does not require the opportunity for a hearing prior to the sale of personal property by a garageman pursuant to the Lien Law, relied primarily on Magro v. Lentini Bros. Moving & Storage Co., 338 F.Supp. 464 (E.D.N.Y.1971), aff’d per curiam on opinion below, 460 F.2d 1064 (2 Cir.), cert, denied, 406 U.S. 961 (1972) 1 There, the court upheld the *384constitutionality of the UCC’s warehouseman’s lien provision, N.Y.U.C.C. § 7-210 (McKinney 1964), which permits a warehouseman to enforce a statutory lien by sale of the bailed goods without a prior judicial hearing. The basis for that conclusion was the court’s reading of Sniadach v. Family Finance Corp., 395 U.S. 337 (1969), which it held confined the requirement of a pre-seizure hearing to goods “the deprivation of which will drive the debtor ‘to the wall’.” 338 F.Supp. at 468. Where a debtor voluntarily parts with possession of goods for a reasonably long period of time,2 the district court reasoned in Magro, the deprivation of those goods cannot be said to be of sufficient severity to bring the case within Sniadach.
Regardless of the validity of that view at the time of the district court’s decision in Magro, the “necessities” distinction surely was put to rest in Fuentes v. Shevin, 407 U.S. 67 (1972). In Fuentes, the Supreme Court disapproved the district courts' rejection of plaintiffs’ constitutional claim
“on the ground that the goods seized from them — a stove, a stereo, a table, a bed, and so forth — were not deserving of due process protection, since they were not absolute necessities of life. The courts based this holding on a very narrow reading of Sniadach v. Family Finance Corp., supra, and Goldberg v. Kelly, [397 U.S. 254], in which this Court held that the Constitution requires a hearing before prejudgment wage garnishment and before the termination of certain welfare benefits. They reasoned that Sniadach and Goldberg, as a matter of constitutional principle, established no more than that a prior hearing is required with respect to the deprivation of such basically ‘necessary’ items as wages and welfare benefits.
This reading of Sniadach and Goldberg reflects the premise that those cases marked a radical departure from established principles of procedural due process. They did not. Both decisions were in the mainstream of past cases, having little or nothing to do with the absolute ‘necessities’ of life but establishing that due process requires an opportunity for a hearing before a deprivation of property takes effect. . . . While Sniadach and Goldberg emphasized the special importance of wages and welfare benefits, they did not convert that emphasis into a new and more limited constitutional doctrine.” 407 U.S. at 88-89 (footnotes omitted).
See also, e. g., Bell v. Burson, 402 U.S. 535, 539 (1971).
Thus, if Magro is to have the continued validity with which the district court in the instant case credited it, that would be permissible only on the assumptions that (1) the “necessities” distinction was unnecessary to the decision, and (2) the critical factor in Magro was the voluntary transfer of the property —a factor also present in the instant case. My reading of the Magro opinion makes the first assumption appear dubious at best. Nor, it seems to me, does the second withstand close scrutiny, even if we were to assume that the court’s reference to the voluntary transfer was only to bolster the inference that the bailed goods did not come within Snia-dach.
In the instant case, I should assume that the reason for focusing on the voluntariness of appellant’s delivery of his car to the garageman is that it is the deprivation of tangible property that calls due process into play. As I read the cases, however, it is the deprivation of a significant property interest that gives rise to the requirement of a prior *385opportunity to be heard. E. g., Boddie v. Connecticut, 401 U.S. 371, 379 (1971); Fuentes v. Shevin, supra, 407 U.S. at 86. Here, it is true that appellant in a sense voluntarily delivered his car for the purpose of temporary storage and perhaps eventual repair. But it cannot be seriously contended that at the same time he voluntarily relinquished his property interest in the car. Indeed, the law is clear that, while a bailment creates a new property interest in the bailee, it does not divest the bailor of his continuing interest and title. E. g., Maudling v. United States, 257 F.2d 56, 60 (9 Cir. 1953). I find little, if any, significance in the fact that the initial delivery of the car was voluntary. I would not distinguish this case from the seizure eases on that ground.
The critical question therefore would appear to be whether the deprivation of which appellant complains, although not involving a seizure, is nevertheless encompassed within the interdiction of the Fourteenth Amendment. Following the Supreme Court’s analysis in Fuentes, the inquiry should proceed along these lines. First, the Fuentes Court noted that the replevy of the goods at issue did involve a deprivation of a possessory interest. Second, it said that under Sniadach and Bell the temporary, non-final nature of the deprivation was not decisive of the right to a prior hearing of some kind. Third, it held that the uncertainty of the ultimate right to possession did not negate that right: “It is enough to invoke the procedural safeguards of the Fourteenth Amendment that a significant property interest is at stake, whatever the ultimate outcome of a hearing on the contractual right to continued possession and use of the goods.” 407 U.S. at 87. Fourth, as stated above, the Court rejected any limitation of the due process clause to items denominated “necessaries”. Finally, it recognized the existence of certain “extraordinary situations” that might justify the summary seizure of property while postponing notice and an opportunity to be heard. E. g., Fahey v. Mallo-nee, 332 U.S. 245 (1947) (impending bank failure); Ewing v. Mytinger & Casselberry, Inc., 339 U.S. 594 (1950) (misbranded drugs). Since the replevin statutes challenged in Fuentes were not limited to such special circumstances and since the goods replevied were entitled to the protections of the Fourteenth Amendment, the Court held the statutes were unconstitutional in their failure to afford the basic elements of due process before the deprivation occurred.
A like analysis, in my view, would lead to the same result here. The sale provisions of the Lien Law permits the permanent deprivation of a significant property interest without a prior hearing; the statutory language is not confined to extraordinary situations in which such summary action might be justifiable. Comparing the Lien Law here to the replevin statutes struck down ih Fuentes, there would appear to be an even greater- disregard for the .basic elements of due process. The sale of the liened goods, for example, completely extinguishes the possibility of any future right of repossession in the event of ultimate success on the merits; re-plevin, in contrast, is a provisional remedy intended to preserve the integrity of the goods pending trial on the underlying claim. Moreover, a common replevin provision3 requires that an action on the merits be commenced contemporaneously by the creditor; the Lien Law, on the other hand, permits the enforcement of the lien, and the liquidation of the goods, without any judicial review at any stage.4
*386In short, while Fuentes dealt with a statute and business setting different in certain respects from the instant case, the policies and constitutional principles articulated in Fuentes strongly point to the' conclusion here that the enforcement provision of the New York Lien Law is unconstitutional in that it permits the deprivation of a significant property interest without the opportunity for some sort of prior hearing. Thus, in my view, if appellant is able to prove the facts alleged in his complaint, he would be entitled to the relief requested.
In stating my views as I have, I am not unmindful of the substantial stake that garagemen, repairmen, and others have in the prompt enforceability of their liens. As Judge Mishler pointed out in Magro, saddling these persons with the requirement of instituting a legal action before they may dispose of their security “would serve no other purpose in the vast majority of cases than to increase the cost of the services and to weaken the . . . security.” 338 F.Supp. at 468. That argument, however, has been foreclosed by Fuentes, where the Court stated:
“[Ojrdinary hearing costs are no more able to override due process rights in the creditor-debtor context than in other contexts.
In any event, the aggregate cost of an opportunity to be heard . should not be exaggerated. For we deal here only with the right to an opportunity to be heard. Since the issues and facts decisive of rights . may very often be quite simple, there is a likelihood that many defendants would forgo their opportunity, sensing the futility of the exercise in the particular case. And, of course, no hearing need be held unless the defendant, having received notice of his opportunity, takes advantage of it.” 407 U.S. at 92-93 n. 29 (emphasis that of the Court).
While the enforcement of a lien by means of a public sale of the liened goods is a time-honored and necessary remedy for a garageman, it is not inconsistent with that remedy to afford the owner an opportunity for some sort of a prior judicial determination of the lien and of the amount of the debt.5 The absence of that opportunity makes the statute a party to the deprivation of a significant property interest without the right to the basic protections of the Fourteenth Amendment. Fuentes and other recent Supreme Court decisions seem to me to require considerably more.
II.
With regard to the Lien Law’s detention provision, N.Y. Lien Law § 184 (McKinney Supp. 1972), I agree with Judge Wyzanski that the voluntary and undisputed incurrence- of some reasonable storage charges precludes appellant from contesting the fact of the lien resulting therefrom. While I also agree that appellant’s challenge to the detention provision is no longer justiciable despite the dispute as to the amount of the debt, I reach that conclusion by somewhat different reasoning than that of Judge Wyzanski.
Primarily, I do not see why the failure to demand the car or to tender the amount of reasonable storage charges should make any difference. In the first place, appellant should not be penalized for neglecting to do what certainly would have been a futile act. *387And second, had the car been returned to appellant pending his constitutional challenge to the detainer provision, his action then would have been subject to the same mootness objection that we sustained in Kerrigan v. Boucher, 450 F.2d 487 (2 Cir. 1971).
I would ground our decision instead on the fact that, in the present posture of the ease, there is no relief available to appellant that will improve his position or make him whole for the injury allegedly sustained as a result of the operation of the detention provision. A declaratory judgment is not available where, despite an allegation of past wrongdoing, there is no continuing live controversy- — here, in the sense of a continuing detention. Golden v. Zwickler, 394 U.S. 103, 108 (1969). By the same token, an injunction would provide appellant with no more than a pyrrhic assurance that, if a similar conflict were to arise again with this same garageman, he would be granted an opportunity to be heard before his car is sold. Cf. Magro v. Lentini Bros. Moving & Storage Co., supra, 338 F.Supp. at 469.
There remains to be considered appellant’s claim for damages. That claim consists of a request for (1) $66 per week for each week he was deprived of the use of his automobile; (2) $1000 for mental and emotional distress allegedly caused by appellees; and (3) $1000 punitive damages from two of the appellees. If I understand this claim correctly, the amount of damages attributed to the detention, as opposed to the sale, of appellant’s ear may fairly be characterized as nominal. Unlike such cases as Powell v. McCormack, 395 U.S. 486, 498 (1969), this is not a cause of action for which the remaining claim for damages remains “hotly contested”. Rather, as in Kerrigan, the detention claim is one by which appellant essentially is seeking an adjudication of the unconstitutionality of § 184. “Not having found a justiciable controversy permitting a declaration, the claim for nominal damages, which is clearly incidental to the relief sought, cannot properly be the basis upon which a court should find a case or controversy where none in fact exists.” Kerrigan v. Boucher, supra, 450 F.2d at 489-90.
But these considerations clearly are not applicable to appellant’s challenge to the sale provision. As to that, appellant alleges that he is continuing to suffer from an unconstitutional act, for which declaratory, injunctive, and monetary relief remain available.
For the reasons stated above, I concur in the judgment of the Court and in the opinion of Judge Wyzanski to the extent that they reverse the order dismissing the complaint and remand for trial on the issue of the constitutionality of the sale provisions of the New York Lien Law as applied to the sale of appellant’s automobile.
I am authorized to state that Judge Lumbard concurs in this opinion.

. The district court also relied on Dininny v. Reavis, 100 Misc. 316 (Sup.Ct., N.Y. Co., 1915), aff’d, 178 App.Div. 922, 165 N.Y.S. 97 (1st Dept. 1917). There, in what apparently is the only state court ruling on the constitutionality of the Lien Law’s enforcement procedure, the court found the availability to the owner of lien-ed property of numerous legal options to protect his interest as satisfying the requirements of due process. The basis for that view, however, seems to have been undermined by Fuentes v. Shevin, 407 U.S. 67, 83 n. 13 (1972), where the Court noted that “if a [businessman] knows that he is dealing with an uneducated, uninformed consumer with little access to legal help and little familiarity with legal procedures, there may be a substantial possibility that a summary seizure of property ■ — however unwarranted — may go unchallenged, and the [businessman] may feel that he can act with impunity.”
In any event, in light of the Supreme Court’s recent due process decisions (e. g., Sniadach v. Family Finance Corp., 395 *384U.S. 337 (1969) ; Bell v. Burson, 402 U.S. 535 (1971) ; Fuentes v. Shevin, supra), the authority of a 58-year old constitutional decision rendered by a state trial court is of doubtful force.

. In Magro, plaintiffs, having been evicted from their apartment, placed their furniture in storage under a contract with defendants that called for a minimum period of storage of three months.

. E. g., Fla.Stat.Ann. § 78.07 (Supp. 1972-73) (“Before a replevy writ issues, plaintiff shall file a bond with surety payable to defendant to be approved by the clerk in at least double the value of the property to be replevied conditioned that plaintiff will prosecute his action to effect and without delay . . . .”).

. The fact that the owner may institute a suit for damages or other appropriate relief does not, in the uneven situation normally involved in enforcement of a lien, satisfy the requirements of . due process. See note 1, supra.

. The flexibility inherent in the clue process clause should need no further explication than it has received in the recent cases. E. g., Fuentes v. Shevin, supra, 407 U.S. at 96-97 and n. 33. The test as to whether the Constitution has been offended is not in the form of hearing but rather in whether the available hearing provides a real opportunity for ascertainment of the “validity, or at least the probable validity, of the underlying claim . . . before the [alleged debtor] can be deprived of his property.” Sniadach v. Family Finance Corp., supra, 395 U.S. at 343 (Harlan, J., concurring) (emphasis by Justice Harlan). Any form of hearing that provides that opportunity would appear to satisfy the due process requirement.