Court Opinion

ID: 770007
Source: CourtListenerOpinion
Date Created: 2012-04-18 10:28:57+00
Date Added: 2024-06-11T17:55:47.165648
License: Public Domain

223 F.3d 518 (7th Cir. 2000)
Leonard Guzell, Plaintiff-Appellant,v.R. Hiller and J. Gawlik, Defendants-Appellees.
No. 99-4070
In the  United States Court of Appeals  For the Seventh Circuit
Argued April 19, 2000Decided August 7, 2000

Appeal from the United States District Court  for the Northern District of Illinois, Eastern Division.  No. 99 C 3740--James H. Alesia, Judge.
Before Posner, Coffey, and Easterbrook, Circuit  Judges.
Posner, Circuit Judge.

1
The plaintiff appeals  from the dismissal under Fed. R. Civ. P. 12(b)(6)  of his Fourth Amendment false-arrest suit against  two Chicago police officers. 42 U.S.C. sec. 1983.  According to the complaint, back in 1988 Guzell,  a travel agent, sold a round-trip Chicago-to-  Warsaw airline ticket to Agniezka Bacik. "In  order to facilitate the travel arrangements and  as security for payment," we read in the  complaint, Bacik left her passport with Guzell.  The ticket was "processed," whatever exactly that  means (probably that it was issued), but Bacik  refused to pay for it, so Guzell did not return  her passport. (Whether she was able to use the  ticket without her passport is unclear--maybe she  had another passport, issued by another country.)  Eleven years later Bacik appeared in Guzell's  office and demanded her passport back. He  refused, because she had never paid for the  ticket and was unwilling to do so now. She  complained to the police, who went to Guzell's  office and told him to give her back her  passport. He refused, explaining that he was  holding the passport as part of a business  dispute and that she had a civil remedy. The  police arrested him for misdemeanor theft. He was  prosecuted, but the case against him was  dismissed. Whether Bacik ever got her passport  back, and why she wanted it back since it almost  certainly had expired, are among the unresolved  mysteries of this case. There is no argument that  the police should have known that prosecution  would be barred by the statute of limitations,  since the statute probably did not begin to run  until Bacik's demand for the return of the  passport, which she had left voluntarily with  Guzell eleven years before, was refused. Cf.  Owens-Illinois, Inc. v. Candle Man, Inc., 279 N.E.2d 774 (Ill. App. 1972); Hobson's Truck  Sales, Inc. v. Carroll Trucking, Inc., 276 N.E.2d 89, 91 (Ill. App. 1971).

2
Guzell attached to his complaint the police  report of the arrest, minus one page, which the  defendants have included in their brief. The  record also contains a complaint to the police  signed by Bacik. By attaching pages from the  police report to his complaint, Guzell made them  a part of the complaint "for all purposes." Fed.  R. Civ. P. 10(c). But this does not mean that he  necessarily vouched for all the facts set forth  in them, Northern Indiana Gun & Outdoor Shows,  Inc. v. City of South Bend, 163 F.3d 449, 455  (7th Cir. 1998); Gant v. Wallingford Board of  Education, 69 F.3d 669, 674 (2d Cir. 1995), thus  setting the stage for an argument that he had  pleaded himself out of court. Ogden Martin  Systems of Indianapolis, Inc. v. Whiting Corp.,  179 F.3d 523, 529 (7th Cir. 1999); Thomas v.  Farley, 31 F.3d 557 (7th Cir. 1994); Early v.  Bankers Life & Casualty Co., 959 F.2d 75, 79 (7th  Cir. 1992). A plaintiff in a libel suit who  attached the allegedly libelous article to his  complaint would obviously not be vouching for the  truth of the libelous assertions in the article.  Gant v. Wallingford Board of Education, supra, 69  F.3d at 674. The plaintiff's purpose in attaching  an exhibit to his complaint determines what  assertions if any in the exhibit are facts that  the plaintiff has incorporated into the  complaint. We need not pursue the issue here,  however, as Guzell does not appear to be  contesting the accuracy of the police report.

3
Nor do we understand him to be contesting the  authenticity, as opposed to the accuracy, of  Bacik's signed complaint to the police. Its  accuracy is in any event of limited relevance to  the question whether the police had probable  cause to arrest Guzell. Police are entitled to  base an arrest on a citizen complaint, whether of  a victim (as here) or a nonvictim witness,  without investigating the truthfulness of the  complaint, unless--this turns out to be an  important qualification--they have reason to  believe it's fishy. Gramenos v. Jewel Cos., 797 F.2d 432, 439-40 (7th Cir. 1986); Rodgers v.  Lincoln Towing Service, Inc., 771 F.2d 194, 200  (7th Cir. 1985); McKinney v. George, 726 F.2d 1183, 1187 (7th Cir. 1984); Butler v. Goldblatt  Bros., Inc., 589 F.2d 323, 325-26 (7th Cir.  1978); Lee v. Sandberg, 136 F.3d 94, 103 (2d Cir.  1997). So we can treat the police report plus  Bacik's complaint as the factual record upon  which to base a judgment of whether the police  had probable cause, or at least a reasonable  basis for thinking they had probable cause, to  arrest Guzell.

4
Bacik's complaint, though much trumpeted by the  defendants, has limited relevance to the question  whether they were acting reasonably in arresting  Guzell. Obviously written by the police though  signed by her, it merely recites the statutory  elements of theft--that Guzell "knowingly  obtained control over property of Bacik [namely  her passport] . . . intending to deprive [her]  permanently of the use of the property." See 720  ILCS 5/16-1. Since it is obvious and indeed  conceded that Bacik told the police more than  this, the reasonableness of their action cannot  be predicated on the written complaint alone.  There is no rule that the police can make an  arrest whenever they have a scrap of paper that  contains statements which if true (even though  they may have been taken out of context)  establish probable cause for an arrest. Otherwise  they could have arrested Guzell on the basis of  the complaint that we have quoted plus a  statement by Bacik that he had obtained control  over her passport by using a giant magnet to draw  it out of her safe deposit box. Police must act  reasonably on the basis of what they know, and if  what they know is more than an isolated sentence  in a police report they can't close their eyes to  the additional information.

5
Bacik's complaint is, moreover, contradicted by  the defendants' own argument that the passport  was and is the property of the United States and  thus not, as her complaint states, "property of  Bacik." The argument founders immediately on the  fact that there is nothing in the record to  indicate that it is a U.S. passport; it may be a  Polish passport, and we have no idea whether  Poland regards the holder of its passports as  having a property interest in them. No doubt  Poland--no doubt every country--places more  restrictions on a person's use of his passport  than on his use of his toothbrush, but this does  not mean that the passport is not, at least for  many purposes, the person's property.

6
It may seem surprising that the defendants would  argue that the passport was not Bacik's property,  since if they reasonably believed that it was,  whether or not it really was, that would, one  might think, give them probable cause to arrest  Guzell for withholding it. The police could not  be faulted for lacking a clear idea of the  property rights in passports, an esoteric issue.  The problem, and the motivation for this line of  argument, is that to establish probable cause the  defendants must show they were reasonable in  thinking that Guzell wasn't merely trying to  enforce a security interest in the passport, but  had really stolen the passport. They deny that  the passport was Bacik's property (despite what  she told them) in order to show that Guzell  couldn't have had a security interest in it. This  is another misstep. Under the law of theft, all  that is required to demonstrate that he didn't  steal the passport is that he had a bona fide  belief that he had a valid security interest in  it which he could lawfully enforce by holding on  to the passport until she paid for the ticket.  Phelps v. People, 55 Ill. 334 (1870); People v.  Baum, 579 N.E.2d 374, 375 (Ill. App. 1991) ("a  bona fide belief, even though mistakenly held,  that one has a right or claim to another's  property, can negate an intent to permanently  deprive the owner of his property"); People v.  Baddeley, 245 N.E.2d 593, 595 (Ill. App. 1969).  The LaFave and Scott treatise treats as  unproblematic the defense of good faith when  property "is taken for security, rather than in  satisfaction of, the debt or claim." 2 Wayne R.  LaFave and Austin W. Scott, Jr., Substantive  Criminal Law sec. 8.5, p. 363 (1986). In any  event, one can have (and not just believe,  mistakenly but honestly, that one has) a valid  security interest in property that is not owned  by the grantor of the interest. Midwest Decks,  Inc. v. Butler & Baretz Acquisitions, Inc., 649 N.E.2d 511, 516 (Ill. App. 1995); In re Pubs,  Inc. of Champaign, 618 F.2d 432, 436 (7th Cir.  1980); Kunkel v. Sprague National Bank, 128 F.3d 636, 641 (8th Cir. 1997); First National Bank v.  Avondale Mills Bevelle Employees Federal Credit  Union, 967 F.2d 556, 559 (11th Cir. 1992); 2  James J. White & Robert S. Summers, Uniform  Commercial Code sec. 24-6, pp. 322-23 (3d ed.  1988). Thus a tenant can borrow against his  leasehold, id., p. 323; In re Fullop, 6 F.3d 422,  425 (7th Cir. 1993), even though by definition he  does not own the leased property.

7
The defendants' further argument, for which no  authority is offered, that U.S. law forbids the  granting of a security interest in a passport  also assumes without any basis in the scanty  record that Bacik's passport is a U.S. passport.  What we do know, recurring to the restrictions  that countries place on the use of the passports  they issue, is that Guzell, should he have tried  to "foreclose" his alleged security interest,  could not have sold Bacik's passport to someone  else to use, or have used it himself. 18 U.S.C.  sec. 1544. But it does not follow that Bacik  could not have pledged the passport to him as  security for his advancing her the money for the  airline ticket. Secured credit has been said to  originate in the practice of giving hostages to  secure one's promises, Oliver Wendell Holmes,  Jr., The Common Law 247-51, 260 (1881), since a  thing as well as a person can be a hostage. We do  not permit the use of human beings as pledges any  more and so if Bacik had given Guzell her child  to hold until she paid for her ticket he could  not refuse to return it to her even if she  refused to pay for the ticket. But we are given  no reason to think that the law treats a  passport, especially a foreign passport,  similarly, though we can find no cases on the  point.

8
Since the defendants have failed to establish  that Guzell could not possibly have had a  security interest in the passport, a fortiori  they have failed to establish that he could not  have had a bona fide belief that he had such an  interest. Guzell could no more be charged with  knowledge of the intricacies of secured  transactions than the police could be. But we  reject Guzell's argument that because he did not  intend to keep the passport "permanently," but  only until Bacik paid him for the ticket, he  could not be guilty of theft under Illinois law.  There are two fallacies in this argument. The  first is its failure to recognize that under  Illinois law, extortion, which includes holding  someone's property for ransom, is treated as a  form of theft. United States v. Bedell, 981 F.2d 915 (7th Cir. 1992); cf. United States v.  Lallemand, 989 F.2d 936, 939 (7th Cir. 1993).  Second and related but more fundamental, the word  "permanently" when it appears in statutory or  judicial definitions of theft is not to be taken  literally. Otherwise if Guzell had taken Bacik's  diamond necklace and told her he would see to it  that it was returned to her heirs in the year  3000, he would not be guilty of theft. What  "permanently" means in this context is "either  permanently or for an unreasonable length of  time, or [that the defendant] intended to use it  in such a way that the owner will probably be  deprived of his property." 2 LaFave and Scott,  supra, sec. 8.5, p. 357. The defendant may  originally not have intended to keep the property  "permanently" (in this extended sense), but if  upon demand for its return he refuses to give it  up an inference of such an intent can arise; the  refusal then marks the point at which his holding  of the property went over into theft. People v.  Block, 540 N.E.2d 512, 516-17 (Ill. App. 1989);  cf. People v. Davis, 523 N.E.2d 165, 167 (Ill.  App. 1988). This is why, as we noted earlier, the  statute of limitations probably didn't start to  run until Guzell rejected Bacik's demand for the  return of the passport.

9
What the question in this case comes down to,  therefore, is whether the police had reason to  believe that Guzell was treating the passport as  if he owned it. The answer is yes if they  reasonably believed that he had no color of right  to withhold possession of the passport from  Bacik. And so let us turn to the police report,  the accuracy of which, as we said, Guzell does  not contest. The report recites that Bacik had  told the police that Guzell had taken her  passport in order "to perform a service thru his  travel agency" and then when she tried to recover  it he told her "'give me 350 and it's yours,'"  though "no service was performed." The report  goes on to say that the police went to Guzell and  told him to return the passport but that he  refused, saying he would not return it until "she  paid a renewal fee"--which makes absolutely no  sense. Although the passport would have expired  (at least if it was a U.S. passport), obviously  Guzell would not have expected Bacik to pay him  the renewal fee, since he could not renew her  passport. Before arresting him, the police  "attempted to explain he could not hold the  passport for payment (that being a civil  matter)." The police report also and  inconsistently states that he told them he had  refused to return the passport because she owed  him "money for services rendered" and that the  police had responded that "in order to recover  money for services was a civil matter and he  could not hold the passport for payment."

10
Had Bacik denied that she had any dispute with  Guzell over payment for past services, the police  could have chosen to believe her (although such a  denial, unsupported by any documentary evidence,  about what had happened eleven years earlier  might warrant a high degree of skepticism) and  disbelieve Guzell. That possibility is implicit  in the rule that allows the police to arrest on a  citizen complaint without investigating its  truthfulness. And apparently Bacik did tell them  that Guzell had never performed any service for  her that would justify his keeping her passport  until she paid him $350. But she did not deny  that there was a dispute over this. Or if she  did, it nevertheless appears from the police  report that the police accepted Guzell's  contention that he had a dispute with Bacik, and  specifically that he thought she owed him money  (there is no contention that the police thought  the debt barred by the statute of limitations)  and that he was holding the passport as security  for the payment of that money. We have not been  told on what basis the police could have  determined that Guzell knew, or was reckless in  failing to learn, that he had no right to treat  the passport as security. If they reasonably  believed that a passport is just like a child and  so cannot be a pledge, and that this is so clear  that Guzell was unlikely to have a bona fide  belief to the contrary, then they may have had  probable cause to arrest him after all. But of  this there is no indication in the record, which  in its present almost naked state is entirely  consistent with the defendants' having no ground  for doubting Guzell's good faith in claiming a  security interest in Bacik's passport. A fuller  development of the facts may cast them in a quite  different light, and perhaps provide a basis for  a defense of immunity if not for a finding of  probable cause; but the dismissal of the  complaint on motion under Rule 12(b)(6) was  premature.

11
Reversed and Remanded.