Motor Vehicles_recovery of stolen vehicles_notice to subsequent purchaser
The trial court erred by granting summary judgment for DMV in an action arising from
the recovery of a stolen car where there was no evidence that DMV gave defendant, a
subsequent purchaser, the notice required by statute. Although DMV argued that defendant had
no right to notice or a hearing because she could not show a paramount right to the car, her
evidence showed a sufficient property interest to merit protection under the North Carolina
Constitution. N.C.G.S. § 20-108(c).
Judge STEELMAN concurring.
Russell L. McLean, III, for defendant/third-party plaintiff.
Attorney General Roy Cooper, by Assistant Attorney General
Jeffrey R. Edwards, for the State.
CALABRIA, Judge.
Cynthia D. Messer (“appellant”) appeals the entry of summary
judgment in favor of T.L. Davis (“Davis”) and the State of North
Carolina Department of Transportation, Division of Motor Vehicles
(“DMV”) (collectively “appellees”). We reverse.
On 24 June 1999, appellant executed a note and security
agreement with Citifinancial, Inc., f/k/a Commercial Credit
Corporation (“Citifinancial”) in the principal amount of $9,352.81for the purchase of a Chevrolet Monte Carlo. Citifinancial
obtained a security interest in the vehicle to secure the loan.
In July of 2000, an officer of DMV conducted a routine vehicle
identification number (“VIN”) verification, discovered there were
possibly two stolen vehicles from Canada sold by Timothy Ramey, and
contacted the National Insurance Crime Bureau (“NICB”) for
assistance in locating a Canadian officer to aide in the
investigation. Subsequent investigation indicated Ramey, his
uncle, and his father were tampering, removing, or altering VINs of
vehicles and selling those cars in the United States with new or
altered VINs. Eight vehicles bearing VINs matching the VIN of a
vehicle owned by the three Ramey suspects were located in North
Carolina, one of which was registered to appellant.
On 19 July 2000, Davis seized and stored appellant's vehicle.
At that time, Davis provided appellant with a document that stated
he was “authorized to seize, take and possess any motor vehicle or
motor vehicle part [which he had] reason to believe [was] stolen or
which ha[d] an altered, covered, defaced, removed or destroyed
serial or identification number[].” The document went on to state
that DMV would “notify the owner of a vehicle seized and stored
officially of the location and purpose of the seizure within 15
days.” Nothing in the record indicates any further written notice
was given to appellant within that period.
Due to similarities in the VINs and other similar
characteristics between appellant's vehicle and the car reported
stolen in Canada, DMV concluded Ramey had removed the true VIN from
the car stolen in Canada, replaced it with a VIN registered to himfrom a similar, and likely salvaged, vehicle, and sold it to
appellant, who had subsequently relied on the most readily
observable VINs as opposed to checking the VINs found elsewhere
such as the frame and engine. Accordingly, on 5 September 2000,
DMV turned the vehicle over to State Farm Insurance, the successor-
in-interest to the Canadian owner from whom DMV concluded the car
had been stolen.
On or about March 2001, appellant ceased making payments on
the note and security agreement, and Citifinancial filed suit,
seeking the balance of the amount owed. Appellant answered the
complaint and filed a third-party complaint against appellees on 15
May 2001. Citifinancial moved for summary judgment against
appellant, which the trial court granted on 9 October 2002. After
denying in part appellees' motion to dismiss, appellees answered
the third-party complaint and moved for summary judgment. The
trial court granted appellees' motion for summary judgment on 20
November 2003. Appellant seeks review before this Court.
In her only assignment of error, appellant asserts the trial
court erred as a matter of law in granting summary judgment in
favor of appellees. Summary judgment is appropriate where “the
pleadings, depositions, answers to interrogatories, and admissions
on file, together with the affidavits, if any, show that there is
no genuine issue as to any material fact and that any party is
entitled to a judgment as a matter of law.” N.C. Gen. Stat. §
1A-1, Rule 56(c) (2003). “In ruling on such motion, the trial
court must view all evidence in the light most favorable to the
non-movant, taking the non-movant's asserted facts as true, anddrawing all reasonable inferences in her favor.” Glenn-Robinson v.
Acker, 140 N.C. App. 606, 611, 538 S.E.2d 601, 607 (2000).
North Carolina General Statutes § 20-108 (2003) governs issues
arising from vehicles or component parts of vehicles without
manufacturer's numbers or with manufacturer's numbers that have
been altered, changed, or obliterated. Under subsection (a), a
person is guilty of a Class 2 misdemeanor if they knowingly
undertake certain actions with respect to a vehicle or component
part of a vehicle (“property”) bearing an identification mark or
number that has been modified “for the purpose of concealing or
misrepresenting the identity” of the property. N.C. Gen. Stat. §
20-108(a). Where the property has such a modification to its VIN
or designated officers of DMV have probable cause to believe there
was a violation of subsection (a), those officers are permitted to
take and possess it. N.C. Gen. Stat. § 20-108(b). After the
seizure, the seizing officer must immediately notify DMV and the
rightful owner, if known, and DMV has fifteen days to notify the
person from whom the property was seized and all claimants with
interest or title in the registration records of DMV. N.C. Gen.
Stat. § 20-108(b),(c). The notice to the person from whom the
property was seized must be sent by certified mail and must
contain, inter alia, the following information: (1) DMV has taken
custody of the property; (2) the name and address of the person or
persons from whom the property was seized; (3) a statement that the
property was seized for “investigation as provided in” N.C. Gen.
Stat. § 20-108 and will be released to the rightful owner upon
either a determination that the identification number has not beenaltered, changed or obliterated or presentation of satisfactory
evidence of ownership of the property if no other person claims an
interest within thirty days of when the notice was mailed. N.C.
Gen. Stat. § 20-108(c). If another person claims an interest, a
dispositional hearing for the property before a court is permitted.
Id. This dispositional hearing may be commenced either by DMV
after the property has come within the custody of one of its
officers or by any possessor of the property. N.C. Gen. Stat. §
20-108(d). The purpose of the dispositional hearing is to allow
the court to order whether the property should be sold, destroyed,
converted to the use of DMV, or otherwise disposed of. Id.
The burden of establishing, by a preponderance of the
evidence, the occurrence of a violation with respect to the
property is upon DMV. N.C. Gen. Stat. § 20-108(h). Anyone
claiming ownership to the property bears the burden of showing
satisfactory evidence of ownership. N.C. Gen. Stat. § 20-108(i).
No court order disposing of the property may issue unless the
person from whom the property was seized and all claimants with
interest or title in the registration records of DMV are provided
(a) a postseizure hearing and (b) ten days' notice of the
postseizure hearing via certified mail. N.C. Gen. Stat. § 20-
108(f).
In the instant case, the record is devoid of evidence that DMV
gave appellant notice complying with the requirements of N.C. Gen.
Stat. § 20-108(c); however, DMV asserts non-compliance with N.C.
Gen. Stat. § 20-108(c) is irrelevant because N.C. Gen. Stat. § 20-
108(e) trumps the other provisions of N.C. Gen. Stat. § 20-108 andgives it the authority to “return[] a seized motor vehicle or
component part to the owner following presentation of satisfactory
evidence of ownership[.]” We disagree with DMV's proposed reading
of the statute.
First, DMV would still have to notify the person from whom the
property was seized as mandated by subsection (c) even if
subsection (e) were construed in the manner suggested by DMV.
Second, DMV's construction of subsection (e) would render untrue
the notification required by subsection (c) by DMV to the person
from whom the property was seized that the seized property would be
released to the rightful owner upon presentation of satisfactory
evidence of ownership “if no other person claims an interest in it
within 30 days of the date the notice is mailed. Otherwise, a
hearing regarding the disposition of [the seized property] may take
place in a court having jurisdiction.” N.C. Gen. Stat. § 20-
108(c)(2)b.
Moreover, DMV's proposed reading of subsection (e) would raise
significant constitutional concerns. While DMV, citing McDonald's
Corp. v. Dwyer, 338 N.C. 445, 447, 450 S.E.2d 888, 890 (1994),
suggests there can be no state procedural due process argument for
lack of a “legitimate claim of entitlement” to the seized property,
we are of the opinion that this view improperly restricts the
required property interest. In Dwyer, our Supreme Court did not
require a showing of title to establish a property interest. Id.
The Court stated that the party need not have undisputed title to
the property and that possession is sufficient: “Even if there are
underlying disputes about the validity of their title, this shouldhave no effect on defendants' standing to challenge the
constitutionality of the statute. Defendants are also in open and
full possession of the property. Accordingly, defendants' property
interest cannot be seized without their consent or due process of
law.” Id., 338 N.C. at 447-48, 450 S.E.2d at 890. We hold
accordingly.
Although it is merely persuasive and not controlling, see
Lorbacher v. Housing Authority of the City of Raleigh, 127 N.C.
App. 663, 675, 493 S.E.2d 74, 81 (1997), we note our construction
of appellant's due process rights under our state constitution
accords with the approach adopted by the United States Supreme
Court for the federal constitution:
The Fourteenth Amendment's protection of
“property,” however, has never been
interpreted to safeguard only the rights of
undisputed ownership. Rather, it has been
read broadly to extend protection to “any
significant property interest,” . . . . The
appellants were deprived of such an interest
in the replevied goods _ the interest in
continued possession and use of the goods . .
. . Clearly, their possessory interest in the
goods, dearly bought and protected by
contract, was sufficient to invoke the
protection of the Due Process Clause.
Fuentes v. Shevin, 407 U.S. 67, 86-87, 32 L. Ed. 2d 556, 573
(1972).
In the instant case, appellant's evidence tended to show she
purchased and possessed the car without knowledge that it was
stolen. This showing constitutes, in our mind, a sufficient
property interest to merit protection by our constitution. DMV's
argument, that appellant had no right to notice or a hearingbecause she could not show a paramount right to the car over that
of the true owner, places the cart before the horse:
The right to be heard does not depend upon an
advance showing that one will surely prevail
at the hearing. To one who protests against
the taking of his property without due process
of law, it is no answer to say that in his
particular case due process of law would have
led to the same result because he had no
adequate defense upon the merits. 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.
Fuentes, 407 U.S. at 87, 32 L. Ed. 2d at 574 (internal quotation
marks and citations omitted). Accordingly, we hold the trial court
erred in granting summary judgment and remand for further
proceedings not inconsistent with this opinion.
Reversed.
Judge GEER concurs.
Judge STEELMAN concurs with a separate opinion.
STEELMAN, Judge concurring.
I agree entirely with the majority opinion in this matter, but
write separately to address the increasingly frequent abuse of the
appendix to briefs by appellate counsel. In this case, counsel
for the Department of Transportation (DOT) attached as a portion of
the appendix to its brief, fourteen pages of material from five
different Internet sites pertaining to vehicle identification
numbers for Chevrolet automobiles. DOT argued this material in its
brief to bolster its argument that the vehicle in question was in
fact the vehicle stolen from Canada. This matter was decided bythe trial court upon DOT's motion for summary judgment, which was
granted on 20 November 2003. None of this material is contained in
the record on appeal. All of the Internet material bears the date
of 17 May 2004, two days prior to the filing of DOT's brief in this
matter.
Rule 28(d) of the Rules of Appellate Procedure governs
appendixes to briefs. N.C. R. App. P. 28(d). Subsection (d)(1)c
allows an appellant to reproduce in an appendix the following:
“relevant portions of statutes, rules, or regulations, the study of
which is required to determine questions presented in the brief.”
While not expressly stated in Rule 28(d), it would appear that this
provision would be equally applicable to appellees as well. None
of the Internet material contained in appellee's appendix
constitutes “statutes, rules, or regulations.” On their face, it
is clear the documents do not come from any website operated by a
government agency or the manufacturer of Chevrolet automobiles, but
rather are private sites. There is no provision in Rule 28(d)
allowing for the inclusion of material found on the Internet in
appendixes to appellant briefs.
“This Court has held, 'it [is] improper [for a party] . . . to
attach a document not in the record and not permitted under N.C. R.
App. P. 28(d) in an appendix to its brief.'” Duke Univ. v. Bishop,
131 N.C. App. 545, 547, 507 S.E.2d 904, 905 (1998) (quoting Horton
v. New South Ins. Co., 122 N.C. App. 265, 268, 468 S.E.2d 856, 858
(1996)). The rationale for this rule is clear. The role of an
appellate court is to review the rulings of the lower court, not to
consider new evidence or matters that were not before the trialcourt. If this were permitted, the appellate process would never
end.
Appellate counsel should take care to follow the requirements
of Rule 28(d) in placing material in an appendix. Failure to
comply with this rule subjects counsel to sanctions by this court.
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