OCTOBER TERM, 1992
Syllabus
REPUBLIC NATIONAL BANK OF MIAMI
v.
UNITED STATES
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE
ELEVENTH CIRCUIT
No. 91-767. Argued October 5, 1992-Decided December 14,1992
The Government filed a civil action in the District Court,
alleging that a particular residence was subject to forfeiture
under 21 U. S. C. § 881 (a)(6) because its owner had purchased it
with narcotics trafficking proceeds. After the United States
Marshal seized the property, petitioner Bank, which claimed a lien
under a recorded mortgage, agreed to the Government's request for a
sale of the property, the proceeds of which were retained by the
marshal pending disposition of the case. A trial on the merits
resulted in a judgment denying the Bank's claim with prejudice and
forfeiting the sale proceeds to the United States. When the Bank
filed a timely notice of appeal but failed to post a supersedeas
bond or seek to stay the execution of the judgment, the marshal, at
the Government's request, transferred the sale proceeds to the
United States Treasury. The Court of Appeals then granted the
Government's motion to dismiss, holding,
inter alia, that
the removal of the sale proceeds from the judicial district
terminated the District Court's
in rem jurisdiction.
Held: The judgment is reversed, and the case is remanded.
932 F.2d
1433, reversed and remanded.
JUSTICE BLACKMUN delivered the opinion of the Court with respect
to Parts I, II, and IV, concluding that, in an
in rem
forfeiture action, the Court of Appeals is not divested of
jurisdiction by the prevailing party's transfer of the res from the
district. The "settled" rule on which the Government relies-that
jurisdiction over such a proceeding depends upon continued control
of the res-does not exist. Rather, the applicable general principle
is that jurisdiction, once vested, is not divested by a
discontinuance of possession, although exceptions may exist where,
for example, release of the res would render the judgment "useless"
because the res could neither be delivered to the complainant nor
restored to the claimant. See,
e. g., United States v.
The Little Charles, 26 F. Cas. 979.
The Brig Ann, 9
Cranch 289, 290, distinguished. The fictions of
in rem
forfeiture were developed primarily to expand the reach of the
courts and to furnish remedies for aggrieved parties, not to
provide a prevailing party with a means of defeating its
adversary's claim for redress. Pp. 84-89, 92-93.
81
THE CHIEF JUSTICE delivered the opinion of the Court in part,
concluding that a judgment for petitioner in the underlying
forfeiture action would not be rendered "useless" by the absence of
a specific congressional appropriation authorizing the payment of
funds to petitioner. Even if there exist circumstances where funds
which have been deposited into the Treasury may be returned absent
an appropriation, but cf.
Knote v.
United States,
95 U. S. 149, 154,
it is unnecessary to plow that uncharted ground here. For together,
31 U. S. C. § 1304-the general appropriation for the payment of
judgments against the United Statesand 28 U. S. C. § 2465-requiring
the return of seized property upon entry of judgment for claimants
in forfeiture proceedings-would authorize the return of funds in
this case in the event petitioner were to prevail below. See
Office of Personnel Management v.
Richmond, 496 U. S.
414, 432. Pp. 93-96.
BLACKMUN, J., announced the judgment of the Court and delivered
the opinion of the Court with respect to Parts I, II, and IV, in
which REHNQUIST, C. J., and WHITE, STEVENS, O'CONNOR, SCALIA,
KENNEDY, and SOUTER, JJ., joined, and an opinion with respect to
Part III, in which STEVENS and O'CONNOR, JJ., joined. REHNQUIST, C.
J., delivered the opinion of the Court in part, as to which WHITE,
SCALIA, KENNEDY, SOUTER, and THOMAS, JJ., joined, and an opinion
concurring in part and concurring in the judgment, in which WHITE,
SCALIA, KENNEDY, and SOUTER, JJ., joined,
post, p. 93.
WHITE, J., filed a concurring opinion,
post, p. 96. STEVENS,
J.,
post, p. 99, and THOMAS, J.,
post, p. 99, filed
opinions concurring in part and concurring in the judgment.
Stanley A. Beiley argued the cause for petitioner. With
him on the briefs were
Robert M. Sondak and
David S.
Garbett.
Robert A. Long, Jr., argued the cause for the United States.
With him on the brief were Solicitor General Starr, Assistant
Attorney General Mueller, Deputy Solicitor General Roberts, and
Joseph Douglas Wilson.
JUSTICE BLACKMUN announced the judgment of the Court and
delivered the opinion of the Court with respect to Parts I, II, and
IV, and an opinion with respect to Part III. *
The issue in this case is whether the Court of Appeals may
continue to exercise jurisdiction in an
in rem civil
forfeiture
*JUSTICE STEVENS and JUSTICE O'CONNOR join this opinion in its
entirety.
82
proceeding after the res, then in the form of cash, is removed
by the United States Marshal from the judicial district and
deposited in the United States Treasury.
I
In February 1988, the Government instituted an action in the
United States District Court for the Southern District of Florida
seeking forfeiture of a specified single-family residence in Coral
Gables. The complaint alleged that Indalecio Iglesias was the true
owner of the property; that he had purchased it with proceeds of
narcotics trafficking; and that the property was subject to
forfeiture to the United States pursuant to § 511(a)(6) of the
Comprehensive Drug Abuse Prevention and Control Act of 1970, as
amended, 92 Stat. 3777, 21 U. S. C. § 881(a)(6).1 A warrant for the
arrest of the property was issued, and the United States Marshal
seized it.
In response to the complaint, Thule Holding Corporation, a
Panama corporation, filed a claim asserting that it was the owner
of the res in question. Petitioner Republic National Bank of Miami
(Bank) filed a claim asserting a lien interest of $800,000 in the
property under a mortgage recorded in 1987. Thule subsequently
withdrew its claim. At the request of the Government, petitioner
Bank agreed to a sale
1 Title 21 U. S. C. § 881 (a) reads in pertinent part:
"The following shall be subject to forfeiture to the United
States and no property right shall exist in them:
"(6) All moneys, negotiable instruments, securities, or other
things of value furnished or intended to be furnished by any person
in exchange for a controlled substance in violation of this
subchapter, all proceeds traceable to such an exchange, and all
moneys, negotiable instruments, and securities used or intended to
be used to facilitate any violation of this subchapter, except that
no property shall be forfeited under this paragraph, to the extent
of the interest of an owner, by reason of any act or omission
established by that owner to have been committed or omitted without
the knowledge or consent of that owner."
83
of the property. With court approval, the residence was sold for
$1,050,000. The sale proceeds were retained by the marshal pending
disposition of the case. See App. 6, n. 2.
After a trial on the merits, the District Court entered judgment
denying the Bank's claim with prejudice and forfeiting the sale
proceeds to the United States pursuant to § 881(a)(6).
Id.,
at 25. The court found probable cause to believe that Iglesias had
purchased the property and completed the construction of the
residence thereon with drug profits. It went on to reject the
Bank's innocent-owner defense to forfeiture.
United States
v.
One Single Family Residence Located at 6960 Miraflores
Avenue, Coral Gables, Florida, 731 F. Supp. 1563 (SD Fla.
1990).2 Petitioner Bank filed a timely notice of appeal, but did
not post a supersedeas bond or seek to stay the execution of the
judgment.
Thereafter, at the request of the Government, the United States
Marshal transferred the proceeds of the sale to the Assets
Forfeiture Fund of the United States Treasury. The Government then
moved to dismiss the appeal for want of jurisdiction. App. 4.
The Court of Appeals granted the motion.
932
F.2d 1433 (CAll 1991). Relying on its 6-to-5 en bane decision
in
United States v.
One Lear Jet Aircraft, Serial No.
35A-280, Registration No. YN-BVO, 836 F.2d
1571, cert. denied, 487 U. S. 1204 (1988), the court held that
the removal of the proceeds of the sale of the residence terminated
the District Court's
in rem jurisdiction. 932 F. 2d, at
1435-1436. The court also rejected petitioner Bank's argument that
the District Court had personal jurisdiction because the Government
had served petitioner with the complaint of forfeiture.
Id.,
at 1436-1437. Finally, the court ruled that the Govern-
2 The Government also had argued that the "relation-back"
doctrine precluded the Bank from raising an innocent-owner defense.
See 731 F. Supp., at 1567. That issue is pending before this Court
in No. 91-781,
United States v.
A Parcel of Land, Rumson,
N. J., argued October 13, 1992.
84
ment was not estopped from contesting the jurisdiction of the
Court of Appeals because of its agreement that the United States
Marshal would retain the sale proceeds pending order of the
District Court.
Id., at 1437.
In view of inconsistency and apparent uncertainty among the
Courts of Appeals,3 we granted certiorari. 502 U. S. 1090
(1992).
II
A civil forfeiture proceeding under § 881 is an action
in
rem, "which shall conform as near as may be to proceedings in
admiralty." 28 U. S. C. § 2461(b). In arguing that the transfer of
the res from the judicial district deprived the Court of Appeals of
jurisdiction, the Government relies on what it describes as a
settled admiralty principle: that jurisdiction over an
in
rem forfeiture proceeding depends upon continued control of the
res. We, however, find no such established rule in our cases.
Certainly, it long has been understood that a valid seizure of the
res is a prerequisite to the
initiation of an
in rem
civil forfeiture proceeding.
United States v.
One
Assortment of 89
Firearms, 465 U. S. 354, 363
(1984);
Taylor v.
Carryl, 20 How. 583, 599 (1858); 1
S. Friedell, Benedict on Admiralty § 222, p. 14-39 (7th ed. 1992);
H. Hawes, The Law Relating to the Subject of Jurisdiction of Courts
§ 92 (1886). See also Supplemental Rules for Certain Admiralty and
Maritime Claims C(2) and C(3).
3 Compare United States v. One Lot of $25, 721.00 in Currency,
938 F.2d
1417 (CA1 1991); United States v. Aiello,
912
F.2d 4 (CA2 1990), cert. denied, 498 U. S. 1048 (1991); United
States v. $95,945.18, United States Currency,
913
F.2d 1106 (CA4 1990), with United States v. Cadillac Sedan
Deville, 1983,
933 F.2d
1010 (CA6 1991) (appeal dism'd); United States v. Tit's
Cocktail Lounge,
873 F.2d
141 (CA7 1989); United States v. $29,959.00 U. S. Currency,
931 F.2d
549 (CA9 1991); and the Court of Appeals' opinion in the
present case. Compare also United States v. $57,480.05 United
States Currency and Other Coins,
722 F.2d
1457 (CA9 1984), with United States v. Aiello, 912 F. 2d, at 7,
and United States v. $95,945.18, United States Currency, 913 F. 2d,
at 1110, n. 4.
85
The bulk of the Government's cases stands merely for this
unexceptionable proposition, which comports with the fact that, in
admiralty, the "seizure of the RES, and the publication of the
monition or invitation to appear, is regarded as equivalent to the
particular service of process in the courts of law and equity."
Taylor v.
Carryl, 20 How., at 599.
To the extent that there actually is a discernible rule on the
need for continued presence of the res, we find it expressed in
cases such as
The Rio Grande, 23 Wall. 458 (1875), and
United States v.
The Little Charles, 26 F. Cas. 979
(No. 15,612) (CC Va. 1818). In the latter case, Chief Justice
Marshall, sitting as Circuit Justice, explained that "continuance
of possession" was not necessary to maintain jurisdiction over an
in rem forfeiture action, citing the "general principle,
that jurisdiction, once vested, is not divested, although a state
of things should arrive in which original jurisdiction could not be
exercised."
Id., at 982. The Chief Justice noted that in
some cases there might be an exception to the rule, where the
release of the property would render the judgment "useless" because
"the thing could neither be delivered to the libellants, nor
restored to the claimants."
Ibid. He explained, however,
that this exception "will not apply to any case where the judgment
will have any effect whatever."
Ibid. Similarly, in
The
Rio Grande, this Court held that improper release of a ship by
a marshal did not divest the Circuit Court of jurisdiction. "We do
not understand the law to be that an actual and continuous
possession of the
res is required to sustain the
jurisdiction of the court. When the vessel was seized by the order
of the court and brought within its control the jurisdiction was
complete." 23 Wall., at 463. The Court there emphasized the
impropriety of the ship's release. The Government now suggests that
the case merely announced an "injustice" exception to the
requirement of continuous control. But the question is
86
one of jurisdiction, and we do not see why the means of the res'
removal should make a difference.4
Only once, in
The Brig Ann, 9 Cranch 289, 290 (1815), has
this Court found that events subsequent to the initial seizure
destroyed jurisdiction in an
in rem forfeiture action. In
that case, a brig was seized in Long Island Sound and brought into
the port of New Haven, where the collector took possession of it as
forfeited to the United States. Several days later, the collector
gave written orders for the release of the brig and its cargo from
the seizure. Before the ship could leave, however, the District
Court issued an information, and the brig and cargo were taken by
the marshal into his possession. This Court held that, because the
attachment was voluntarily released before the libel was filed and
allowed, the District Court had no jurisdiction. Writing for the
Court, Justice Story explained that judicial cognizance of a
forfeiture
in rem requires
"a good subsisting seizure at the time when the libel or
information is filed and allowed. If a seizure be completely
and explicitly abandoned, and the property restored by the
voluntary act of the party who has made
4 See also
The Bolina, 3 F. Cas. 811, 813-814 (No. 1,608)
(CC Mass. 1812) (Story, J., as Circuit Justice) ("[O]nce a
vessel is libelled, then she is considered as in the custody of the
law, and at the disposal of the court, and monitions may be issued
to persons having the actual custody, to obey the injunctions of
the court .... The district court of the United States derives its
jurisdiction, not from any supposed possession of its officers, but
from the act and place of seizure for the forfeiture .... And when
once it has acquired a regular jurisdiction, I do not perceive how
any subsequent irregularity would avoid it. It may render the
ultimate decree ineffectual in certain events, but the regular
results of the adjudication must remain"); 1 J. Wells, A Treatise
on the Jurisdiction of Courts 275 (1880) (An actual or constructive
seizure provides jurisdiction in an admiralty forfeiture action.
"And, having once acquired regular jurisdiction, no subsequent
irregularity can defeat it; or accident, as, for example, an
accidental fire").
87
the seizure, all rights under it are gone. Although judicial
jurisdiction once attached, it is divested by the subsequent
proceedings; and it can be revived only by a new seizure. It is, in
this respect, like a case of capture, which, although well made,
gives no authority to the prize Court to proceed to adjudication,
if it be voluntarily abandoned before judicial proceedings are
instituted." Id., at 291 (emphasis added).
Fairly read,
The Brig Ann simply restates the rule that
the court must have actual or constructive control of the res when
an
in rem forfeiture suit is initiated. If the seizing party
abandons the attachment prior to filing an action, it, in effect,
has renounced its claim. The result is "to purge away all the prior
rights acquired by the seizure,"
ibid., and, unless a new
seizure is made, the case may not commence.
The Brig Ann
stands for nothing more than this.
The rule invoked by the Government thus does not exist, and we
see no reason why it should. The fictions of
in rem
forfeiture were developed primarily to expand the reach of the
courts and to furnish remedies for aggrieved parties, see
Continental Grain Co. v.
Barge FBL-585, 364 U. S. 19, 23
(1960); Harmony v.
United States, 2 How. 210, 233
(1844), not to provide a prevailing party with a means of defeating
its adversary's claim for redress. Of course, if a "defendant ship
stealthily absconds from port and leaves the plaintiff with no
res from which to collect,"
One Lear Jet, 836 F. 2d,
at 1579 (Vance, J., dissenting), a court might determine that a
judgment would be "useless." Cf.
The Little Charles, 26 F.
Cas., at 982. So, too, if the plaintiff abandons a seizure, a court
will not proceed to adjudicate the case. These exceptions, however,
are closely related to the traditional, theoretical concerns of
jurisdiction: enforceability of judgments and fairness of notice to
parties. See 1 R. Casad, Jurisdiction in Civil Actions § 1.02, pp.
1-13 to 1-14 (2d ed. 1991); cf.
Miller v.
United
States, 11 Wall. 268, 294-295 (1871) ("Confessedly
88
the object of the writ was to bring the property under the
control of the court and keep it there, as well as to give notice
to the world. These objects would have been fully accomplished if
its direction had been nothing more than to hold the property
subject to the order of the court, and to give notice"). Neither
interest depends absolutely upon the continuous presence of the res
in the district.
Stasis is not a general prerequisite to the maintenance of
jurisdiction. Jurisdiction over the person survives a change in
circumstances,
Leman v.
Krentler-Arnold Hinge Last
Co., 284 U. S.
448, 454 (1932) ("[A]fter a final decree a party cannot defeat
the jurisdiction of the appellate tribunal by removing from the
jurisdiction, as the proceedings on appeal are part of the cause,"
citing
Nations v.
Johnson, 24 How. 195 (1861)), as
does jurisdiction over the subject matter,
Louisville, N.
A. & C.
R. Co. v.
Louisville Trust Co.,
174 U. S. 552,
566 (1899) (mid suit change in the citizenship of a party does not
destroy diversity jurisdiction);
St. Paul Mercury Indemnity
Co. v.
Red Cab Co., 303 U. S. 283, 289-290
(1938) (jurisdiction survives reduction of amount in controversy).
Nothing in the nature of
in rem jurisdiction suggests a
reason to treat it differently.
If the conjured rule were genuine, we would have to decide
whether it had outlived its usefulness, and whether, in any event,
it could ever be used by a plaintiff-the instigator of the
in
rem action-to contest the appellate court's jurisdiction. The
rule's illusory nature obviates the need for such inquiries,
however, and a lack of justification undermines any argument for
its creation. We agree with the late Judge Vance's remark in
One
Lear Jet, 836 F. 2d, at 1577:
"Although in some circumstances the law may require courts to
depart from what seems to be fairness and common sense, such a
departure in this case is unjustified and unsupported by the law of
forfeiture and admiralty." We have no cause to override common
sense and fairness here. We hold that, in an
in rem
forfeiture action, the Court of Appeals is not
89
divested of jurisdiction by the prevailing party's transfer of
the res from the district.5
III
The Government contends, however, that this res no longer can be
reached, because, having been deposited in the United States
Treasury, it may be released only by congressional appropriation.
If so, the case is moot, or, viewed another way, it falls into the
"useless judgment" exception noted above, to appellate
in
rem jurisdiction.
The Appropriations Clause, U. S. Const., Art. I, § 9, cl. 7,
provides: "No money shall be drawn from the Treasury, but in
Consequence of Appropriations made by Law." In
Knote v.
United States, 95 U. S. 149 (1877), this
Court held that the President could not order the Treasury to repay
the proceeds from the sale of property forfeited by a convicted
traitor who had been pardoned. But the Government-implicitly in its
brief and explicitly at oral argument, see Tr. of Oral Arg.
37-39-now goes further, maintaining that, absent an appropriation,
any funds that find their way into a Treasury account must remain
there, regardless of their origin or ownership. Such a rule would
lead to seemingly bizarre results. The Ninth Circuit recently
observed: "If, for example, an
5We note that on October 28, 1992, the President signed the
Housing and Community Development Act of 1992, 106 Stat. 3672.
Section 1521 of that Act (part of Title XV, entitled the
Annunzio-Wylie Anti-Money Laundering Act) significantly amended 28
U. S. C. § 1355 to provide, among other things:
"In any case in which a final order disposing of property in a
civil forfeiture action or proceeding is appealed, removal of the
property by the prevailing party shall not deprive the court of
jurisdiction. Upon motion of the appealing party, the district
court or the court of appeals shall issue any order necessary to
preserve the right of the appealing party to the full value of the
property at issue, including a stay of the judgment of the district
court pending appeal or requiring the prevailing party to post an
appeal bond." 106 Stat. 4062-4063.
Needless to say, we do not now interpret that statute or
determine the issue of its retroactive application to the present
case.
90
agent of the United States had scooped up the cash in dispute
and, without waiting for a judicial order, had run to the nearest
outpost of the Treasury and deposited the money ... it would be
absurd to say that only an act of Congress could restore the
purloined cash to the court."
United States v.
Ten
Thousand Dollars ($10,000.00) in United States Currency,
860 F.2d
1511, 1514 (1988). Yet that absurdity appears to be the logical
consequence of the Government's position.
Perhaps it is not so absurd. In some instances where a private
party pays money to a federal agency and is later deemed entitled
to a refund, an appropriation has been assumed to be necessary to
obtain the money. See 55 Compo Gen. 625 (1976); United States
General Accounting Office, Principles of Federal Appropriations Law
5-80 to 5-81 (1982). Congress, therefore, has passed a permanent
indefinite appropriation for "'Refund of Moneys Erroneously
Received and Covered' and other collections erroneously deposited
that are not properly chargeable to another appropriation." 31 U.
S. C. § 1322(b)(2). This appropriation has been interpreted to
authorize, for example, the refund of charges assessed to
investment advisers by the Securities and Exchange Commission and
deposited in the Treasury, after those charges were held to be
erroneous in light of decisions of this Court. See 55 Compo Gen.
243 (1975); see also
National Presto Industries, Inc. v.
United States, 219 Ct. Cl. 626, 630 (1979) (suggesting that
prior version of § 1322(b)(2) authorized refund of sum deposited in
Treasury during litigation). Section 1322(b)(2) arguably applies
here.
Petitioner offers a different suggestion. It identifies 28 U. S.
C. § 2465 as an appropriation. That statute states:
"Upon the entry of judgment for the claimant in any proceeding
to condemn or forfeit property seized under any Act of Congress,
such property shall be returned forthwith to the claimant or his
agent." That is hardly standard language of appropriation. Cf. 31
U. S. C. § 1301(d). Yet I have diffi-
91
culty imagining how an "appropriation" of funds determined on
appeal not to belong to the United States could ever be more
specific.6
In part for that reason, however, I believe that a formal
appropriation is not required in these circumstances. The
Appropriations Clause governs only the disposition of money that
belongs to the United States. The Clause "assure[s] that
public
funds will be spent according to the letter of the difficult
judgments reached by Congress."
Office of Personnel
Management v.
Richmond, 496 U. S. 414, 428 (1990)
(emphasis added); see also Stith, Congress' Power of the Purse, 97
Yale L. J. 1343, 1358, and n. 67 (1988) (Clause encompasses only
funds that belong to the United States); 2 Story, Commentaries on
the Constitution of the United States § 1348 (3d ed. 1858) (object
of the Clause "is to secure regularity, punctuality, and fidelity,
in the disbursements of the
public money" (emphasis added)).
I do not believe that funds held
6 THE CHIEF JUSTICE, writing for the Court on this question,
post, p. 93, would find an appropriation in the judgment
fund, 31 U. S. C. § 1304. While plausible, his analysis is
nevertheless problematic. The judgment fund is understood to apply
to money judgments only. See,
e. g., 58 Compo Gen. 311
(1979). A final judgment in petitioner's favor, however, would be
in the nature of a financial "acquittal"-a simple ruling that the
res is not forfeitable. Unless we were to require the bank to sue
on its judgment of nonforfeitability for return of a sum equivalent
to the retained res, THE CHIEF JUSTICE'S approach would seem to
open the judgment fund to payment on nonmoney judgments. Moreover,
as THE CHIEF JusTICE acknowledges, see
post, at 96, "the
property subject to forfeiture in this case has been converted to
proceeds now resting in the Assets Forfeiture Fund of the
Treasury." Title 28 U. S. C. § 2465 can "be construed as
authorizing the return of proceeds in such a case."
Post, at
96. But a payment from the judgment fund would not achieve that
purpose. The res is not in the judgment fund. A payment from that
account, while no doubt entirely acceptable to petitioner, would
not be a return of the forfeited property, and at the end of the
episode (although I have no doubt that the Comptroller would manage
to balance the books) the Assets Forfeiture Fund would be some
$800,000 richer, and the judgment fund correspondingly
diminished.
92
in the Treasury during the course of an ongoing
in rem
forfeiture proceeding-the purpose of which, after all, is to
determine the ownership of the res, see,
e. g., The Propeller
Commerce, 1 Black 574, 580-581 (1862);
The Maggie
Hammond, 9 Wall. 435, 456 (1870);
Jennings v.
Carson, 4 Cranch 2, 23 (1807)-can properly be considered
public money. The Court in
Tyler v.
Defrees, 11 Wall.
331, 349 (1871), explained that once a valid seizure of forfeitable
property has occurred and the court has notice of the fact, "[n]o
change of the title or possession [can] be made, pending the
judicial proceedings, which would defeat the final decree."
Contrary to the Government's broad submission here, the
Comptroller General long has assumed that, in certain situations,
an erroneous deposit of funds into a Treasury account can be
corrected without a specific appropriation. See 53 Compo Gen. 580
(1974); 45 Compo Gen. 724 (1966); 3 Compo Gen. 762 (1924); 12 Compo
Dec. 733, 735 (1906); Principles of Federal Appropriations Law, at
5-79 to 5-81. Most of these cases have arisen where money intended
for one account was accidentally deposited in another. It would be
unrealistic, for example, to require congressional authorization
before a data processor who misplaces a decimal point can "undo" an
inaccurate transfer of Treasury funds. The Government's absolutist
view of the scope of the Appropriations Clause is inconsistent with
these commonsense understandings.
I would hold that the Constitution does not forbid the return
without an appropriation of funds held in the Treasury during the
course of an
in rem forfeiture proceeding to the party
determined to be their owner. Because the funds therefore could be
disgorged if petitioner is adjudged to be their rightful owner, a
judgment in petitioner's favor would not be "useless."
IV
In a civil forfeiture proceeding, where the Government has the
power to confiscate private property on a showing of mere probable
cause, the right to appeal is a crucial safe-
93
guard against abuse. No settled rule requires continuous control
of the res for appellate jurisdiction in an
in rem
forfeiture proceeding. Nor does the Appropriations Clause place the
money out of reach. Accordingly, we hold that the Court of Appeals
did not lose jurisdiction when the funds were transferred from the
Southern District of Florida to the Assets Forfeiture Fund of the
United States Treasury. The judgment of the Court of Appeals is
reversed, and the case is remanded for further proceedings
consistent with this opinion.
It is so ordered.
CHIEF JUSTICE REHNQUIST delivered the opinion of the Court in
part, concurred in part, and concurred in the judgment.*
I join the Court's judgment and Parts I, II, and IV of its
opinion. I write separately, however, because I do not agree with
the Appropriations Clause analysis set forth in Part III. JUSTICE
BLACKMUN "would hold that the Constitution does not forbid the
return without an appropriation of funds held in the Treasury
during the course of an
in rem forfeiture proceeding to the
party determined to be their owner."
Ante, at 92. JUSTICE
BLACKMUN reaches this result because he concludes that funds
deposited in the Treasury in the course of a proceeding to
determine their ownership are not "public money." I have difficulty
accepting the proposition that funds which have been deposited into
the Treasury are not public money, regardless of whether the
Government's ownership of those funds is disputed. Part of my
difficulty stems from the lack of any support in our cases for this
theory.
*JUSTICE WHITE, JUSTICE SCALIA, JUSTICE KENNEDY, and JUSTICE
SOUTER join THE CHIEF JUSTICE'S opinion in its entirety. JUSTICE
THOMAS joins this opinion only insofar as it disposes of the
Appropriations Clause issue.
94
In
Knote v.
United States, 95 U. S. 149, 154 (1877),
we stated: "[I]f the proceeds have been paid into the treasury, the
right to them has so far become vested in the United States that
they can only be secured to the former owner of the property
through an act of Congress. Moneys once in the treasury can only be
withdrawn by an appropriation by law."
Knote is
distinguishable in that the forfeiture proceeding in that case was
final at the time the appropriations question arose. But the
principle that once funds are deposited into the Treasury, they
become public money-and thus may only be paid out pursuant to a
statutory appropriationwould seem to transcend the facts of
Knote. That there exists a specific appropriation for
"'Refund of Moneys Erroneously Received and Covered' and other
collections erroneously deposited that are not properly chargeable
to another appropriation," 31 U. S. C. § 1322(b)(2), supports this
understanding. *
JUSTICE BLACKMUN relies principally on language from
Tyler v.
Defrees, 11 Wall. 331, 349 (1871), to the
effect that once a seizure of forfeitable property has occurred,
"[n]o change of the title or possession [can] be made, pending the
judicial proceedings, which would defeat the final decree." See
ante, at 92. This language is dictum rendered in the course
of deciding a dispute over the sufficiency of the marshal's seizure
of the property subject to forfeiture. But even if it were the
holding of the case, it would have no application to the present
case, because here there
was a
* As JUSTICE BLACKMUN points out, where funds have been
accidently deposited into the wrong account, the Comptroller
General has assumed that a deposit may be corrected without an
express appropriation.
Ante, at 92. So, too, reasons JUSTICE
BLACKMUN, would it be "unrealistic ... to require congressional
authorization before a data processor who misplaces a decimal point
can 'undo' an inaccurate transfer of Treasury funds."
Ibid.
This may be so, but this is not our case. For the funds at issue
were not accidently deposited into the Treasury, but rather
intentionally transferred there once a valid judgment of forfeiture
had been entered by the District Court.
95
final decree entered by the District Court in favor of the
Government. It is petitioner's failure to post a bond or obtain a
stay of that judgment which has brought the present controversy to
this Court.
In any event, even if there are circumstances in which funds
that have been deposited into the Treasury may be returned absent
an appropriation, I believe it unnecessary to plow that uncharted
ground here. The general appropriation for payment of judgments
against the United States provides in part:
"(a) Necessary amounts are appropriated to pay final judgments,
awards, compromise settlements, and interest and costs specified in
the judgments or otherwise authorized by law when-
"(1) payment is not otherwise provided for;
"(2) payment is certified by the Comptroller General; and
"(3) the judgment, award, or settlement is payable"(A) under
section 2414, 2517, 2672, or 2677 of title 28 .... " 31 U. S. C. §
1304.
Title 28 U. S. C. § 2414, in turn, authorizes the payment of
"final judgments rendered by a district court ... against the
United States." Together, §§ 1304 and 2414 would seem to authorize
the return of funds in this case in the event petitioner were to
prevail in the underlying forfeiture action.
But further inquiry is required, for we have said that § 1304
"does not create an all-purpose fund for judicial disbursement ....
Rather, funds may be paid out only on the basis of a judgment based
on a substantive right to compensation based on the express terms
of a specific statute."
Office of Personnel Management v.
Richmond, 496
U. S. 414, 432 (1990). The question, then, is whether
petitioner would have a "substantive right to compensation" if it
were to prevail in this forfeiture proceeding. I believe 28 U. S.
C. § 2465 provides such a right here. That section provides:
"Upon
96
the entry of judgment for the claimant in any proceeding to ...
forfeit property seized under any Act of Congress, such property
shall be returned forthwith to the claimant or his agent." Although
§ 2465 speaks of forfeitable "property" and not public money, the
property subject to forfeiture in this case has been converted to
proceeds now resting in the Assets Forfeiture Fund of the Treasury.
I see no reason why § 2465 should not be construed as authorizing
the return of proceeds in such a case. Therefore, I would hold that
31 U. S. C. § 1304, together with 28 U. S. C. § 2465, provide the
requisite appropriation.
Because I believe there exists a specific appropriation
authorizing the payment of funds in the event petitioner were to
prevail in the underlying forfeiture action, I agree with JUSTICE
BLACKMUN that a judgment for petitioner below would not be
"useless." Accordingly, I concur in the judgment of the Court.
JUSTICE WHITE, concurring.
I agree with Parts I, II, and IV of the Court's opinion but
would prefer not to address the Appropriations Clause issue.
As JUSTICE BLACKMUN indicates,
ante, at 89, the
Government argues that because the Appropriations Clause bars
reaching the funds transferred to the Treasury's Assets Forfeiture
Fund, the case is either moot or falls into the useless judgment
exception to appellate
in rem jurisdiction. I am surprised
that the Government would take such a transparently fallacious
position. The case is not moot and a ruling by the Court of Appeals
would not be a useless judgment. Had the funds not been transferred
to Washington, the Court of Appeals, if it thought the District
Court had erred in rejecting the Bank's innocent-owner defense,
would have been free to reverse the lower court, direct that the
Bank be paid out of the res, and to that extent rule against the
United States' forfeiture claim. The United States does not
ques-
97
tion this, for when the property was sold, the Government agreed
to hold the proceeds pending resolution of the claims against the
res.
The funds are, of course, no longer in Florida, but that fact,
as the Court now holds, did not deprive the Court of Appeals of
jurisdiction to reverse the District Court and direct entry of
judgment against the United States for the amount of the Bank's
lien, nor did it prevent the Court of Appeals from declaring that
the Bank was entitled to have its lien satisfied from the res and,
therefore, that the Government had no legal entitlement to the
proceeds from the sale of the house. The case is obviously not
moot. Nor should the Government suggest that a final judgment
against the United States by a court with jurisdiction to enter
such a judgment is useless because the United States may refuse to
pay it. Rather, it would be reasonable to assume that the United
States obeys the law and pays its debts and that in most people's
minds a valid judgment against the Government for a certain sum of
money would be worth that very amount. This is such a reasonable
expectation that there is no need in this case to attempt to
extract the transferred res from whatever fund in which it now is
held.
There is nothing new about expecting governments to satisfy
their obligations. Thus, in
Steffel v.
Thompson,
415 U. S. 452,
468-471 (1974), the Court discussed the comparative propriety of
entering a declaratory judgment as opposed to an injunction.
Describing the cases of
Roe v.
Wade, 410 U. S. 113
(1973), and
Doe v.
Bolton, 410 U. S. 179 (1973), the
Court explained:
"In those two cases, we declined to decide whether the District
Courts had properly denied to the federal plaintiffs, against whom
no prosecutions were pending, injunctive relief restraining
enforcement of the Texas and Georgia criminal abortion statutes;
instead, we affirmed the issuance of declaratory judgments of
unconstitution-
98
ality, anticipating that these would be given effect by state
authorities." 415 U. S., at 469.
See also
Roe, supra, at 166: "We find it unnecessary to
decide whether the District Court erred in withholding injunctive
relief, for we assume the Texas prosecutorial authorities will give
full credence to this decision that the present criminal abortion
statutes of that State are unconstitutional";
Bolton, supra,
at 201 (same). More generally, it goes without saying that a
creditor must first have judgment before he is entitled to collect
from one who has disputed the debt, and it frequently happens that
the losing debtor pays up without more. Perhaps, however, the
judgment creditor will have collection problems, but that does not
render his judgment a meaningless event.
For the same reasons, it is unnecessary for the Court at this
point to construe the Appropriations Clause, either narrowly or
broadly. Normally, we avoid deciding constitutional questions when
it is reasonable to avoid or postpone them.
Three Affiliated
Tribes of Fort Berthold Reservation v.
Wold Engineering,
P. c.,
467 U. S.
138, 157 (1984);
Liverpool, New York &
Philadelphia S. S.
Co. v.
Commissioners of
Emigration, 113 U.
S. 33, 39 (1885). It is apparent, moreover, that the Court has
struggled to reach a satisfactory resolution of the Appropriations
Clause issue. I would not anticipate that the United States would
default and that the Bank would require the help of the Judiciary
to collect the debt. I would leave it to the Executive Branch to
determine in the first instance, when and if it suffers an adverse
judgment, whether it would have authority under existing statutes
to liquidate the judgment that might be rendered against it. It
will be time enough to rule on the Appropriations Clause when and
if the position taken by the Government requires it.
I bow, however, to the will of the Court to rule prematurely on
the Appropriations Clause, and on that issue I agree with THE CHIEF
JUSTICE and join his opinion.
99
JUSTICE STEVENS, concurring in part and concurring in the
judgment.
While I agree with JUSTICE BLACKMUN'S analysis of the
Government's Appropriations Clause argument, and join his opinion
in its entirety, I also agree with THE CHIEF JUSTICE that 31 U. S.
C. § 1304, together with 28 U. S. C. § 2465, provide a satisfactory
alternative response. Moreover, like JUSTICE WHITE, and for the
reasons stated in his separate opinion, I am surprised that the
Government would make "such a transparently fallacious" argument in
support of its unconscionable position in this case. See
ante, at 96.
JUSTICE THOMAS, concurring in part and concurring in the
judgment.
I cannot join the Court's discussion of jurisdiction because
that discussion is unnecessary and may very well constitute an
advisory opinion. In my view, we should determine the applicability
of § 1521 of the Housing and Community Development Act of 1992, 106
Stat. 4062. Effective October 28, 1992, § 1521 amended 28 U. S. C.
§ 1355 to provide that "[i]n any case in which a final order
disposing of property in a civil forfeiture action or proceeding is
appealed, removal of the property by the prevailing party shall not
deprive the court of jurisdiction." 106 Stat. 4062-4063. The clear
import of the new law is to preserve the jurisdiction of a court of
appeals in a civil forfeiture action where the res has been removed
by the prevailing party-the very issue involved in this case. This
law would appear by its plain terms to be dispositive of this case,
thus rendering academic the discussion in Part II of the Court's
opinion. *
The Court mentions § 1521 in a single footnote, stating simply
that "we do not now interpret that statute or deter-
*By letter dated October 30, 1992, the Government advised the
Court of the enactment of the new law without taking a position on
its applicability. On November 3 petitioner informed us by letter
that in its view § 1521 applies and is controlling.
100
mine the issue of its retroactive application to the present
case."
Ante, at 89, n. 5. As a general rule, of course,
statutes affecting substantive rights or obligations are presumed
to operate prospectively only.
Bennett v.
New Jersey,
470 U. S. 632, 639 (1985). "Thus, congressional enactments ...
will not be construed to have retroactive effect unless their
language requires this result."
Bowen v.
Georgetown Univ.
Hospital, 488 U.
S. 204, 208 (1988). But not every application of a new statute
to a pending case will produce a "retroactive effect." "[W]hether a
particular application
is retroactive" will "depen[d] upon
what one considers to be the determinative event by which
retroactivity or prospectivity is to be calculated."
Kaiser
Aluminum &
Chemical Corp. v.
Bonjorno,
494 U. S. 827,
857, and n. 3 (1990) (SCALIA, J., concurring) (emphasis in
original).
In the case of newly enacted laws restricting or enlarging
jurisdiction, one would think that the "determinative event" for
retroactivity purposes would be the final termination of the
litigation, since statutes affecting jurisdiction speak to the
power of the court rather than to the rights or obligations of the
parties. That conclusion is supported by longstanding precedent. We
have always recognized that when jurisdiction is conferred by an
Act of Congress and that Act is repealed, "the power to exercise
such jurisdiction [is] withdrawn, and ... all pending actions
f[a]ll, as the jurisdiction depend[s] entirely upon the act of
Congress."
Assessors v.
Osbornes, 9 Wall. 567, 575
(1870). "This rule-that, when a law conferring jurisdiction is
repealed without any reservation as to pending cases, all cases
fall with the law-has been adhered to consistently by this Court."
Bruner v.
United States, 343 U. S. 112, 116-117
(1952). See
id., at 117, n. 8 (citing cases). Moreover, we
have specifically noted that "[t]his jurisdictional rule does not
affect the general principle that a statute is not to be given
retroactive effect unless such construction is required by explicit
language or by necessary implication."
Ibid.
101
The same rule ordinarily mandates the application to pending
cases of new laws
enlarging jurisdiction. We so held in
United States v.
Alabama, 362 U. S. 602 (1960)
(per curiam). There, the District Court had concluded that
it was without jurisdiction to entertain a civil rights action
brought by the United States against a State, and the Court of
Appeals had affirmed.
Id., at 603. While the case was
pending before this Court, the President signed the Civil Rights
Act of 1960, which authorized such actions. Relying on "familiar
principles," we held that "the case
must be decided on the
basis of law now controlling, and the provisions of [the new
statute] are applicable to this litigation."
Id., at 604
(emphasis added) (citing cases). We therefore held that "the
District Court has jurisdiction to entertain this action against
the State," and we remanded for further proceedings.
Ibid.
Similarly, in
Andrus v.
Charles tone Stone Products
Co., 436 U. S.
604 (1978), we held that because the general federal-question
statute had been amended in 1976 to eliminate the
amount-in-controversy requirement for suits against the United
States, "the fact that in 1973 respondent in its complaint did not
allege $10,000 in controversy
is now of no moment." Id., at
608, n. 6 (emphasis added).
It could be argued that the language of § 1521 implies an
earlier determinative event for retroactivity purposes-such as the
removal of the res or the point when the final order disposing of
the property "is appealed." 106 Stat. 4062. I do not find these
terms sufficiently clear to overcome the general rule that statutes
altering jurisdiction are to be applied to pending cases; I would
therefore decide this case on the basis of the new law. If the
Court is plagued with doubts about the "retroactive application" of
§ 1521,
ante, at 89, n. 5, the Court should, at a minimum,
seek further briefing from the parties on this question before
embarking on what appears to me to be an unnecessary excursion
through the law of admiralty. There is no legitimate reason not to
take the time to do so, for if the Government were to concede
the
102
102 REPUBLIC NAT. BANK OF MIAMI
v. UNITED STATES
Opinion of THOMAS, J.
new law's applicability, the Court's opinion would be advisory.
I can, therefore, concur only in the Court's judgment on the issue
of jurisdiction.
I do, however, join the opinion of THE CHIEF JUSTICE regarding
the Appropriations Clause. Because the Court of Appeals retains
continuing jurisdiction over this proceeding pursuant to § 1521, we
cannot avoid addressing the Government's arguments on this
issue.
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