Snohomish Reg'l Drug Task Force v. Real Prop. Known as 414 Ne...

151 Wn. App. 743

214 P.3d 928

SNOHOMISH REGIONAL DRUG TASK FORCE ET AL., Respondents v REAL PROPERTY KNOWN AS 414 NEWBERG ROAD, SNOHOMISH, WASHINGTON, LOCATED IN SNOHOMISH COUNTY, Defendant in Rem, BRIAN A. PEARSON, as Executor, ET AL., Appellants, BANK OF AMERICA, NA, Respondent

No. 62933-6-I

COURT OF APPEALS OF WASHINGTON, DIVISION ONE

July 15, 2009, Oral Argument

August 24, 2009, Filed

Orly J. Sorrel (of Sorrell & Tall, Inc., PS), for appellants.

Janice E. Ellis , Prosecuting Attorney and Mary K. Webber , Deputy, and Andrew C. Rapp (of Wolfstone, Panchot & Bloch, PS, Inc.), for respondents.

Authored by Stephen J Dwyer . Concurring: Ann Schindler , Susan Agid .

Stephen J Dwyer

[214 P.3d 930] ¶1 DWYER , J. — It has long been the law in Washington that “a devisee can take no greater interest in the devised property than the devisor has to devise.” Slasor v. Slasor, 111 Wash. 90, 99, 189 P. 546 (1920). In this appeal, the beneficiaries of the estate of Rodney J. Pearson contend that they were entitled to assert the “innocent owner defense” to the forfeiture of a parcel of real property, notwithstanding that the property had been seized prior to Pearson's death based on his use of it for commercial marijuana production. Holding that Pearson was unable to devise a greater interest in his property than he had, that his interest was subject to the forfeiture proceedings as filed, and, thus, that the testamentary transfer of the property could not prevent its forfeiture, we affirm.

I

¶2 The facts are not in dispute. Police responded to a trespass report from a neighbor of the property at issue, 414 Newberg Road. When officers arrived at the neighbor's home, they saw a line of footprints and marijuana plant debris leading to the fence dividing the neighbor's property from 414 Newberg Road. It appeared to the officers that marijuana plants had been dragged from 414 Newberg Road across the neighbor's property. From the fence line, the officers saw that a barn located on the 414 Newberg Road property contained at least 20 to 30 large, clearly visible marijuana plants.

¶3 The police then sought and obtained a search warrant. The warrant authorized officers to search “a barn type structure on the south side of the property located at 414 Newberg Rd, Snohomish, WA.” The warrant further stated that “[t]he main house at 414 Newberg Rd is a brown one story rambler style house with white trim around the windows (not to be searched).”

¶4 Disregarding this last statement in the warrant, the officers went directly to the residence at 414 Newberg Road, knocked on the front door, and, after informing the residents present therein that they were “serving a search warrant,” conducted what was later described as a “protective sweep of the residence due to the past incidents involving firearms.”

¶5 In one of the bedrooms, an officer detected the odor of both fresh and burnt marijuana. Based on this odor, the officer approached a shed on the outside of the house, which was located near the room in the residence in which the smell of marijuana had been detected. He then sniffed, listened, and peered through the crack between the shed's door and doorframe. When he did so, he smelled the odor of marijuana, heard a fan, and could see artificial light coming from within the shed. Based on these observations, the officers then obtained a telephonic addendum to the warrant, extending their search authority to the residence and the shed.

¶6 In the barn, police discovered and seized 78 live marijuana plants measuring up to 13 feet tall. In the shed, they seized 42 smaller marijuana plants and assorted marijuana growing paraphernalia. In the residence, they discovered additional marijuana paraphernalia. In total, the police seized more than 15 pounds of marijuana plant matter.

¶7 Following these events, the Snohomish Regional Drug Task Force (SRDTF) instituted a civil in rem forfeiture action against 414 Newberg Road, filing a lis pendens upon commencing the action and serving complaints against those with a record interest in the property: Pearson and Bank of America, which had recorded two deeds of trust against the property as security for loans to Pearson. In response to this forfeiture action, both Pearson and the bank filed ownership claims against the property. The forfeiture action was then stayed pending the resolution of criminal charges against Pearson, to which he eventually pleaded guilty.

¶8 On August 28, 2007—a little over a year after entering his plea—Pearson executed his last will and testament. In it, he appointed his son Brian Pearson as the personal representative of his estate, the bulk of which (including his interest in 414 Newberg Road) he bequeathed to his other living children: Susan Forman, Derek J. Pearson, Alicia Palm, Justin Pearson, Rodney S. Pearson, and his grandson, Levi Yoder. Four days later, Pearson died. His will was then submitted to probate, at which point SRDTF filed a probate claim against his estate seeking the forfeiture of 414 Newberg Road. After Brian Pearson, as personal representative, rejected SRDTF's claim, he was substituted for Pearson in the forfeiture action. He and the estate's beneficiaries then filed pleadings purporting to assert independent claims against 414 Newberg Road.

¶9 These parties also filed a pleading entitled “Notice of Trial Amendment,” in which they informed the court and the other parties that they intended to move, at any hearing on a dispositive motion, to amend their notice of claims in the forfeiture action to assert cross-claims against Bank of America, alleging that it had “failed and neglected to tender defense of Plaintiffs' baseless claims.” The purported basis for these cross-claims against the bank was a settlement agreement between Bank of America and SRDTF, wherein it was agreed that if SRDTF succeeded in obtaining forfeiture of the property, it would pay to the bank, out of the proceeds of the forfeiture sale, the amount still owing on the loan secured by the deeds of trust, as well as any legal fees incurred by the bank as a result of the forfeiture proceedings.

¶10 On cross-motions for summary judgment, the trial court rejected the claims of the estate and its beneficiaries against the property, as well as the motion to amend that they made in conjunction with their motion for summary judgment.

¶11 This appeal followed.

II

[1, 2] ¶12 “On review of a summary judgment, this court must engage in the same inquiry as the trial court. A motion for summary judgment can be granted only if the pleadings, depositions, affidavits, and admissions on file demonstrate that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” City of Lynnwood v. $ 128 Cash, 61 Wn. App. 505, 510, 810 P.2d 1377 (1991)(citation omitted). “A trial court's decision to deny leave to amend is reviewed for an abuse of discretion.” Rodriguez v. Loudeye Corp., 144 Wn. App. 709, 728-29, 189 P.3d 168 (2008).

III

[3-7] ¶13 According to the beneficiaries, 414 Newberg Road is not subject to forfeiture pursuant toRCW 69.50.505 because they are entitled to assert the so-called “innocent owner” defense set forth in RCW 69.50.505(1)(h)(i). This presents a straightforward question: are the beneficiaries entitled to assert the “innocent owner” defense on their own behalf, as a result of 414 Newberg Road being transferred to them by will after the forfeiture action was commenced and the property seized? We hold that they are not, because the only interest in 414 Newberg Road that Pearson was able to devise was conditioned on a determination of whether he—he, not the beneficiaries of his estate—had knowingly used the property for the commercial production of marijuana.

¶14 The plain language of the drug-forfeiture statute, when read in conjunction with the lis pendens statute, compels this result. RCW 69.50.505(1)(h) provides that real property is “subject to seizure and forfeiture” if the property was

used with the knowledge of the owner for the manufacturing … of any controlled substance … if such activity is not less than a class C felony and a substantial nexus exists between the commercial production or sale of the controlled substance and the real property. However:

(i) No property may be forfeited pursuant to this subsection (1)(h), to the extent of the interest of an owner, by reason of any act or omission committed or omitted without the owner's knowledge or consent;

… .

(iii) The possession of marijuana shall not result in the forfeiture of real property unless the marijuana is possessed for commercial purposes, the amount possessed is five or more plants or one pound or more of marijuana, and a substantial nexus exists between the possession of marijuana and the real property. In such a case, the intent of the offender shall be determined by the preponderance of the evidence, including the offender's prior criminal history, the amount of marijuana possessed by the offender, the sophistication of the activity or equipment used by the offender, and other evidence which demonstrates the offender's intent to engage in commercial activity.

RCW 69.50.505(1)(h). Thus, an owner of real property utilized for commercial marijuana production forfeits any interest in the property, RCW 69.50.505(1)(h)(iii), unless the marijuana production was undertaken “without the owner's knowledge or consent,” 69.50.505(1)(h)(i).

¶15 None of this is at issue. Instead, the issue presented is whether, after property is seized upon probable cause to believe that it is subject to forfeiture, the guilty owner of the property may defeat its forfeiture by transferring it to someone innocent of drug activity. We hold that the owner may not.

¶16 Under RCW 69.50.505(3), “proceedings for forfeiture shall be deemed commenced by the seizure” of the property. In turn, RCW 69.50.505(2) provides that such a seizure may be initiated by an authorized...