Court Opinion

ID: 2740371
Source: CourtListenerOpinion
Date Created: 2014-10-07 19:03:05.032568+00
Date Added: 2024-06-11T09:54:26.090768
License: Public Domain

NOTICE: NOT FOR PUBLICATION.
   UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION DOES NOT CREATE
          LEGAL PRECEDENT AND MAY NOT BE CITED EXCEPT AS AUTHORIZED.

                                    IN THE
             ARIZONA COURT OF APPEALS
                                 DIVISION ONE

STATE OF ARIZONA ex rel. GERMAINE MARKS, Director of Insurance,
                        Plaintiff/Appellee,

                                        v.

              RAYMOND MEROLLE, JR., Claimant/Appellant.

                             No. 1 CA-CV 13-0263
                              FILED 10-07-2014

           Appeal from the Superior Court in Maricopa County
                          No. CV2010-015113
               The Honorable Randall H. Warner, Judge

                                  AFFIRMED

                                   COUNSEL

Arizona Attorney General’s Office, Phoenix
By Lynette Evans
Counsel for Plaintiff/Appellee

Baker & Baker, Phoenix
By Thomas M. Baker
Counsel for Claimant/Appellant
                              STATE v. MEROLLE
                              Decision of the Court

                         MEMORANDUM DECISION

Presiding Judge Peter B. Swann delivered the decision of the Court, in which
Judge Kenton D. Jones and Judge Michael J. Brown joined.

S W A N N, Judge:

¶1            The superior court entered a civil forfeiture judgment in favor of
the state with respect to contraband motor vehicles and parts seized during a
criminal investigation of the appellant. We reject the appellant’s contention that
the petition for forfeiture was untimely asserted by a plaintiff without standing.
We also reject the appellant’s contentions that the relevant statutes did not
require the state to prove its case and that the state improperly sought to
distribute forfeited items to third parties. We affirm the judgment and the
court’s denial of the appellant’s motion for new trial.

                    FACTS AND PROCEDURAL HISTORY

¶2            In early 2006, a special agent of the Arizona Department of
Insurance’s Fraud Unit came to believe that Raymond Merolle, Jr., was involved
in criminal activity related to stolen property.    In connection with an
investigation of Merolle, the agent obtained search warrants for several
properties in Maricopa County. Execution of the search warrants led to the
seizure of numerous motor vehicles and parts. Merolle was later convicted of
theft and arson.

¶3             In March 2010, the Arizona Attorney General’s Office determined
that it would not proceed with further criminal action against Merolle, and the
seized property was released to the Department of Insurance. In May 2010, the
state filed a petition under Title 28 of the Arizona Revised Statutes for forfeiture
of seized vehicles and parts that the state alleged qualified as contraband.
Merolle promptly filed a verified claim disputing the contraband status of the
items. After a five-day bench trial, the superior court found that the majority of
the items were contraband and ordered those items forfeited to the state. The
court denied Merolle’s motion for a new trial.

                                         2
                              STATE v. MEROLLE
                              Decision of the Court

                                  DISCUSSION

¶4             Merolle makes several arguments on appeal. First, he contends
that the plaintiff in the forfeiture action did not have standing. The petition was
brought by the “State of Arizona ex rel. Christina Urias, Director of Insurance,”1
represented by the Arizona Attorney General’s Office. “A suit ex rel. is typically
brought by the government upon the application of a private party (called a
relator) who is interested in the matter.” Black’s Law Dictionary 621 (8th ed.
2004). We conclude that the Director of the Department of Insurance was a
proper relator. Consistent with A.R.S. §§ 20-466(D) and 28-4594(B)(1), the
Department’s Fraud Unit acted as a law enforcement agency to investigate
Merolle and to seize and store property. When faced with the question of how to
dispose of the property, the Department appropriately applied to the Arizona
Attorney General’s Office to commence forfeiture proceedings. See A.R.S. § 28-
4594(B)(2)(b)-(c) (authorizing county attorney or state attorney general to file
petitions for forfeiture of contraband motor vehicles and parts).

¶5            Merolle next contends that the forfeiture petition was not timely
filed. A.R.S. § 28-4594(B)(2)(b) and (c) provide that petitions for forfeiture shall
be filed “within sixty days after the date of seizure or such other reasonable time
as is set by the court.” (Emphasis added.) The contraband vehicles and parts
were seized in 2006. The items were then held as evidence for potential criminal
charges. The petition was filed approximately two months after it was
determined that no further charges would be filed. On this record, we discern no
abuse of discretion in the superior court’s finding that the petition was filed
within “a reasonable time under the circumstances.”

¶6             Merolle next contends that the burden of proof in the forfeiture
proceedings was improperly shifted by A.R.S. §§ 28-4594 and -4595. A petition
for forfeiture must “set forth probable cause that [an] item is contraband.” A.R.S.
§ 28-4594(B)(2)(b)-(c). “[A] motor vehicle or major component part of the vehicle
that has had the manufacturer’s or department’s serial or identification number
removed, defaced, altered or destroyed . . . [is] contraband.” A.R.S. § 28-4594(A).
If a claimant timely disputes the contraband status of the item in a verified claim,
the court “shall conduct a hearing to determine whether the item seized is
contraband.” A.R.S. § 28-4595(A)-(B). At the hearing, “[i]f a claimant does not
prove by a preponderance of the evidence that the original identification
numbers can be permanently restored to the contraband or that the item can be

1      Germaine Marks was later automatically substituted for Christina Urias.
See Ariz. R. Civ. P. 25(e)(1); ARCAP 27(c)(1).

                                         3
                              STATE v. MEROLLE
                              Decision of the Court

rendered noncontraband, the court shall declare the item contraband.” A.R.S.
§ 28-4595(C).

¶7           Merolle argues that under the statutes, the state was not required to
prove at the hearing that the items were contraband. He is incorrect. The
superior court specifically held:

      A.R.S. §§ 28-4594 and 28-4595 do not say that the State bears an
      initial burden at trial of demonstrating probable cause for
      forfeiture. As a matter of due process, however, it must do so. A
      claimant is not required to put on a case unless and until the State
      has made a prima facie case by establishing probable cause for
      forfeiture.

We agree with the superior court’s analysis. The burden that § 28-4595(C)
imposes upon the claimant presupposes that the state has proven the contraband
nature of the items, and therefore properly describes a defense to a prima facie
case. We see nothing in §§ 28-4594 or -4595 that improperly shifts the initial
burden of proof to the claimant. Further, it is apparent from the record that the
court properly assigned the initial burden of proof to the state.2 Merolle does not
challenge the sufficiency of the state’s proof or the court’s findings regarding the
contraband nature of the items.

¶8            Merolle finally contends that the state improperly sought to
distribute the contraband items to third parties who did not appear in the action.
The state distinguished between three categories of motor vehicles and parts: (1)
items for which the owners had been identified and the original identification
numbers could be permanently restored; (2) items for which the owners had
been identified and the original identification numbers could be temporarily
restored; and (3) items for which the owners could not be identified and the

2      Merolle complains that there was a “disparity in the parties’ position and
access to information . . . evident from [his] Motion to Compel Discovery or in
the Alternative Preclude and the trial court’s order denying [him] information
regarding the location of the confidential VINs [vehicle identification numbers]
and even photographs of the confidential VINs.” But the court actually granted
Merolle’s motion in part, ruling that if the state intended to rely on the location
and appearance of confidential VINs it would have to disclose to Merolle its
evidence regarding the same. Contrary to Merolle’s contention, this ruling
supports our conclusion that the superior court properly required the state to
prove its case.

                                         4
                                STATE v. MEROLLE
                                Decision of the Court

original identification numbers could not be permanently or temporarily
restored. Consistent with A.R.S. §§ 28-4594(A) and -4595(C), the first category of
items describes noncontraband and the second and third categories describe
contraband. Under § 28-4594(B)(2)(a), noncontraband items must be returned to
their owners. With respect to contraband items, § 28-4594(B)(2)(b) and (c)
provide that the state should file a petition for forfeiture “to th[e] state for use or
other appropriate disposition by the law enforcement agency that seized the item
or for such other disposition that the state deems appropriate.” The state’s
professed intention to dispose of forfeited contraband items by returning them to
their owners, where known, was entirely proper under the language of the
statute. Contrary to Merolle’s contention, those owners did not need to appear
as “claimants” under A.R.S. § 28-4595. That statute applies to persons who
dispute the contraband status of seized items. A.R.S. § 28-4595(A). It does not
govern the rights of owners who seek the return of contraband items forfeited to
the state.

                                  CONCLUSION

¶9            We affirm for all of the reasons set forth above. We deny Merolle’s
request for attorney’s fees and costs under A.R.S. § 12-348. Section 12-348 does
not apply to proceedings brought by the state under Title 28. A.R.S. § 12-
348(H)(2). And in any event, Merolle would not be entitled to an award because
he has not prevailed on the merits. See A.R.S. § 12-348(A).

                                      :gsh

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