On Friday, the Alabama Supreme Court reversed a Mobile County Circuit Court decision that determined the terms required of a local towing company to repossess its own trucks pending civil forfeiture proceedings, but suggested the Legislature should revisit the law to ensure fair and due process.
Father and son Gary Smith Jr. and Gary Smith Sr., of SOS Towing, were arrested in September 2019 for insurance fraud as part of the Mobile Police Department’s (MPD) sweeping probe into fees charged in excess of those allowed under a municipal ordinance. As a result, prosecutors seized four of the Smiths’ tow trucks under the state’s “fruits of crime forfeiture” law.
Prosecutors argued, pending a decision on the forfeiture, the Smiths could repossess their vehicles by paying a bond double the amount of their value. But the Smiths said they were unable to obtain the bond despite multiple attempts, and urged the court to issue a restraining order against the state during the pendency of the proceedings instead.
Circuit Court Judge Wesley Pipes determined the viability of SOS Towing was adversely affected by the seizure, and allowed the Smiths to repossess their trucks by paying a $5,000 bond rather than the $192,000 bond sought by the state. The Supreme Court reversed and remanded the decision Friday, finding the “double-value bond” provides “the exclusive means for obtaining seized personal property during the pendency of a forfeiture action” and the injunctive relief provided by Pipes “is unavailable as a means for a claimant to obtain such property.”
Yet, in a concurring special opinion written by Justice Tommy Bryan, he found “aspects of this case troubling.”
The Smiths, he emphasized, argued they were unable to obtain the higher bond because they could not use the trucks — which were not in their possession — as collateral. Further, they could not claim any income without the use of their trucks. But Mobile County Assistant District Attorney Chris McDonough allegedly made an inquiry on his own and found a surety company willing to write the bond under the same circumstances for a maximum premium of $30 per $1,000, based on creditworthiness.
“The financial burden that [SOS Towing] actually faces in obtaining the statutory bond is unclear,” Bryan wrote. “However, there is evidence indicating that obtaining the statutory bond presents a considerable challenge for them and that, without the use of the tow trucks, SOS will go out of business … I question whether the Legislature, in passing the bond provision, envisioned a situation in which the existence of a small business was threatened by the business’s struggles to recover essential property before a court finally decides the fate of the property in a forfeiture action.”
Justices Sarah Stewart and Kelli Wise agreed.
Through the asset forfeiture process, police are able to seize and obtain title to any property they suspect was purchased with income from illegal activity or used to facilitate illegal activity, even when the owner hasn’t been criminally charged.
If a forfeiture is approved by a judge, the state is allowed to keep the property or whatever proceeds it may generate through a public auction. Any revenue generated is often split between law enforcement agencies involved and the prosecuting office.
In recent years, growing opposition to civil forfeitures nationwide has led to the reexamination of the practice in Alabama. In 2018, the Alabama Appleseed Center for Law & Justice reported it reviewed 1,591 civil asset forfeiture cases in the state and found 79 percent resulted in favorable verdicts for prosecutors, totaling more than $5 million in assets being transferred from private citizens to local law enforcement agencies. The report found Mobile County led the state in forfeiture proceedings in 2015, obtaining 129 weapons, 30 vehicles, 36 electronic devices, 38 miscellaneous items and $565,391 in cash. In 29 percent of those cases, targeted individuals were never charged with a crime.
In 2019, the Legislature considered a bill to prevent law enforcement agencies from obtaining personal property through forfeiture until after a defendant is convicted of a crime, but the bill was diluted to simply create an “accountability system” where forfeiture proceedings were tracked in a statewide database. It was signed into law by Gov. Kay Ivey the same year.
In addition to the Smiths, the Mobile County District Attorney’s Office is pursuing a number of similar criminal charges against the owners of other local tow truck companies as the result of the MPD’s investigation into fees. In June, four other arrests were made in the case, but it does not appear forfeiture proceedings have been initiated against any other defendant.
Reached for comment late Tuesday, District Attorney Ashely Rich said action on all pending cases has been hampered by the pandemic, but her office is waiting to see if SOS Towing will appeal the Supreme Court’s ruling before deciding whether to seek forfeitures against other companies.
“We will act accordingly, that’s all I’ll say,” she said, adding the Supreme Court ultimately decided “we were right and the defense was wrong.”
The Smiths deferred comment on this story to their attorney, Chase Dearmon, who was arguing a case in front of the 11th Circuit Court of Appeals and could not speak before deadline. But Bryan suggested the Legislature should reconsider the law.
“While it is unclear how the forfeiture case and the criminal case against [SOS] will be resolved, it is possible [they] may ultimately prevail in those cases but nevertheless lose their business if they cannot obtain the necessary statutory bond,” he wrote. “Although I must conclude that the law requires the result reached by the main opinion, the Legislature may want to consider if that is the result it anticipated in adopting the double-value bond provision.”
This page is available to subscribers. Click here to sign in or get access. During the month of December, give (or get) a one year subscription with TWO months FREE.