Court Opinion

ID: 5865377
Source: CourtListenerOpinion
Date Created: 2022-01-13 01:31:23.45726+00
Date Added: 2024-06-11T08:44:33.816951
License: Public Domain

Kupferman, J.,
concurs in a memorandum as follows: Petitioner brought this CPLR article 78 proceeding seeking the return of $2,400 in American Express traveler’s checks seized by the police when they arrested two suspects for gambling violations, and confiscated cash, gambling records, and gambling paraphernalia at the petitioner’s residence. The traveler’s checks, each signed once by the petitioner, were found commingled with the other items. Petitioner was not present during the arrest and seizure, and in this proceeding alleges that the traveler’s checks were not used in the gambling operation. Petitioner asserts that he kept such a large sum in traveler’s checks at his residence because he mistrusted banks. Subdivision b of section 435-4.0 of the Administrative Code of the City of New York provides that all property or money believed to be the proceeds of gambling operations be given to and kept in the custody of the property clerk. When a petitioner brings an article 78 proceeding to recover property retained pursuant to section 435-4.0, such proceeding may be treated as a replevin action. Special Term must take into consideration the due process rights of the petitioner. (See McClendon v Rosetti, 460 F2d 111, 114-115 [CA2d]; Matter of Hill v Gold, 79 Misc 2d 1055, 1057.) In a similar case, Matter of City of New York v Cosme (67 AD2d 852), petitioner City of New York sought a judgment pursuant to section 435-4.0 declaring that respondent was not a lawful claimant to currency seized during the course of respondent’s arrest. The currency was found in a pillowcase along with two ounces of cocaine, two revolvers, and drug paraphernalia. No hearing was held prior to the petition. This court reversed the granting of the petition and remanded for a hearing on the ground that the evidence was inconclusive as to whether “the money represented proceeds of a crime or was utilized in the course of criminal activity.” (Supra, at p 853; see, also, Property Clerk of N. Y. City Police Dept. v Di Paolo, 78 AD2d 834, 835.) Similarly, in the instant action there are questions of fact concerning the traveler’s checks which require as a matter of due process, that a hearing be held, including, but not limited to, the questions of whether the checks are contraband, whether they are related to the gambling operation, and, if so related, whether the checks are needed as evidence in a criminal proceeding. (See McClendon v Rosetti, supra, at p 116.) Moreover, the illegal activity surrounding the seizure of the checks raises the question of whether the checks were lawfully obtained from American Express, and, if so, whether American Express should be made a party to the proceedings. Because the checks were marked “void” by the property clerk, their ownership status is now in limbo, and American Express may be equivalent to a stakeholder. A hearing is needed to determine who owns the checks and to answer the factual questions raised on appeal.