Nassau County update

Nassau County update

Issue #14, November 2014

Now that we are four months into Nassau County’s new DWI forfeiture, program the picture of what is going on is a bit clearer. Nassau’s program has three distinct aspects: seizure, lawsuit and forfeiture.

Seizure

Vehicles are seized immediately upon arrest and impounded subject to reasonable storage fees. Before July 3, 2014, the County did not have its storage facility operable so the cars were released — but this has changed. Now all cars are seized and held. (Pitfall to avoid: excessive storage fees accumulating if a car remains unclaimed.)

As part of the seizure, the County must promptly hold a hearing, called a “Krimstock hearing,” where the County must show that it has grounds to detain the vehicle while it seeks forfeiture. The burden on the County is minimal so in virtually all cases the County will be able to hold the vehicle if it wishes to do so. The one sure way that a driver can force the County to release a vehicle is by posting a bond in a sum ordered by the judge at the hearing. (Pitfall to avoid: leasing companies who are concerned about vicarious liability risks arising when the DWI driver recovers a vehicle on a bond should act quickly to oppose release by bond.)

Lawsuit

The County files a forfeiture lawsuit against every vehicle seized. The lawsuit seeks to wipe out lienholder and lessor interests so that the County may sell the vehicle free and clear. There is an “innocent” lienholder/lessor defense in the County code but lienholders/lessors must file a formal answer to preserve this defense. (Pitfall to avoid: lienholder/lessors who default by not filing a formal answer face losing all rights in the vehicle. See: County of Nassau v. Mendez-Grande and Condor Capital where the County seeks to wipe out a lien due to the lienholder’s failure to answer.)

The County code has a unique provision that allows the County to obtain damages from anyone who transfers a vehicle during the lawsuit without the County’s permission. The damages are the vehicle value plus $1,500. (Pitfall to avoid: lienholder and lessors who take back vehicles or release title must involve the County or face penalties; for instance, release of the title after insurance payoff may incur this risk as in County of Nassau v. Basit where the County obtained judgment for $13,500, plus $1,500 after the County discovered a transfer of title to an insurance company.)

Sometimes the County will name a lienholder/lessor in a lawsuit based upon information on the vehicle title that is outdated. Lienholders/lessors should promptly contact the County to obtain a stipulation dropping the lienholder/lessor from the suit. Ignoring the suit could result in a default being entered against the lienholder/lessor.

Forfeiture

The County will wait until the DWI charges against the driver are concluded before moving for forfeiture. This explains why so much time passes after the seizure with little activity by the County. The County does this because under the County law, a conviction or plea of guilty to DWI or DUI charges will virtually guaranty that the County will win its forfeiture case. (Pitfall to avoid: waiting to recover a vehicle under an “innocent lienholder/lessor defense” until the time the County moves for forfeiture may allow substantial storage fees to accumulate.)

It is important to note that the “innocent lienholder/lessor defense” may only be used once per vehicle as the defense only applies if the lienholder/lessor had no reason to know that the driver had a history of DUI offenses. Once the lienholder/lessor knows of a DUI offense, and it will from the County lawsuit, the County may not accept the defense if another DUI occurs.

In the coming months there is likely to be considerable litigation by drivers who attempt to defeat the County’s forfeiture claims. How the courts respond will provide the final piece of the Nassau County forfeiture puzzle.