No. 19592-9-III.The Court of Appeals of Washington, Division Three. Panel Nine.
Filed: October 23, 2001. DO NOT CITE. SEE RAP 10.4(h). UNPUBLISHED OPINION.
Appeal from Superior Court of Yakima County, No. 99-2-01805-1, Hon. C. J. Lust, September 25, 2000, Judgment or order under review.
Counsel for Appellant(s), John V. Staffan, Deputy Prosecuting Attorney, Room 211, Courthouse, 128 N 2nd St, Yakima, WA 98901.
Counsel for Respondent(s), John A. Moore Jr., Moore and Royal, 217 N 2nd St, Yakima, WA 98901-2332.
DENNIS J. SWEENEY, J.
In reviewing an administrative adjudicative decision, the superior court does not evaluate the credibility of witnesses or make independent findings of fact. The court must determine whether substantial evidence supports the administrative law judge’s findings. If the findings are so supported, and those findings support the administrative law judge’s conclusions of law, then the administrative decision must be upheld.
In this civil forfeiture of a vehicle used in an unlawful drug transaction, extensive conflicting and inconsistent testimony purported to establish William Hooper as the true, and innocent, owner of the vehicle.
The administrative law judge was unpersuaded and ordered the vehicle forfeited.
The record of the proceedings amply supports the administrative law judge’s findings and conclusions. We, therefore, reverse the court’s decision to the contrary and reinstate the administrative forfeiture.
FACTS
On January 3, 1999, Antonio Rivera was arrested while exchanging $8,500 and a used car for a kilo of cocaine. During the transaction, he used a 1995 Chevrolet Tahoe to leave and return with the money. Police arrested Antonio and impounded the Tahoe. The City of Yakima issued a notice of seizure and intent to forfeit. William Hooper filed a claim of ownership. An administrative law judge (ALJ) held a hearing on April 12 and 19, 1999.
Mr. Hooper, his wife Brenda, their daughter Jennifer, and Eliberto Rivera — Jennifer’s boyfriend and Antonio’s brother — all testified. The ALJ rejected Mr. Hooper’s claim of ownership.
The stories told by Mr. Hooper’s witnesses were conflicting and internally inconsistent. Mr. Hooper’s story generally was that he told Jennifer and Eliberto he wanted to buy a second four-wheel-drive vehicle and asked them to keep an eye open for a suitable one. Depending on which witness, if any, he believed, the ALJ could have found that Mr. Hooper wanted the Tahoe because he knew he was moving to the remote area of Curlew, where it snows a lot;[1] that he did not know he was moving to Curlew, but it was his goal to move up that way;[2] or that the move to Curlew had nothing to do with buying the Tahoe.[3]
Mr. Hooper presented evidence that Eliberto saw the Tahoe at Mike Olson Dodge, and arranged to meet Mr. Hooper at Mr. Hooper’s son Kirk’s house the next day with the vehicle.[4] Eliberto testified that he just happened to test drive the Tahoe one day and just happened to drive it to Kirk’s house and Mr. Hooper just happened to be there.[5] It is not disputed that Mr. Hooper bought the Tahoe that same day for around $18,500 cash.
The Hoopers testified that they saved money for several years and accumulated around $20,000. They kept this in cash under the mattress and in tin cans around the house because they did not trust banks. Either Mr. Hooper told his wife, Brenda, about the Tahoe,[6] or he did not tell her about it.[7]
Either Eliberto found out Mr. Hooper had bought the Tahoe a couple of days later when he ran into Kirk and Jennifer on the street and they told him,[8] or he did not run into them on the street but telephoned them and was told by phone,[9] or he visited Jennifer and found Mr. Hooper there with the Tahoe.[10]
Much of the evidence here focuses on Mr. Hooper’s financial affairs. It was not disputed that, on the day he paid $18,500 cash for the Tahoe, Mr. Hooper was driving a 1994 Chevy four-wheel drive vehicle which he was buying on credit at 28 percent interest.
The ALJ entered findings that Mr. Hooper and his witnesses were not credible. The ALJ did not believe Mr. Hooper had saved $20,000 cash. But he did believe that drug dealer Antonio Rivera had $8,500 cash on January 3, 1999. And he did believe that Jennifer had $10,000 cash hidden in her clothes dryer when she was evicted from her apartment two weeks before the Tahoe was bought.
The ALJ found that Mr. Hooper failed to prove true ownership, and therefore lacked standing to raise the innocent owner defense. The ALJ ordered the Tahoe forfeited. Mr. Hooper appealed to the superior court.
The superior court reviewed the entire file and exhibits, including the transcript of the administrative hearing, and heard oral arguments and read the briefs of counsel. The court then entered several pages of findings contrary to those of the ALJ, and concluded that Mr. Hooper was the true owner and that he had no knowledge of the illegal activities involving the Tahoe. It then reversed the ALJ. The City appeals.
STANDARD OF REVIEW
In reviewing an administrative decision, the courts apply the standards of the Washington Administrative Procedure Act directly to the agency record.
RCW 34.05.570(3)(e); Tapper v. Employment Sec. Dep’t, 122 Wn.2d 397, 402, 858 P.2d 494 (1993). In reviewing findings of fact underlying an administrative adjudicative decision, the question is whether there is substantial evidence in the record to support the ALJ’s findings. Valentine v. Dep’t of Licensing, 77 Wn. App. 838, 844, 894 P.2d 1352
(1995). Mr. Hooper contends the ALJ’s decision should be reversed if the record contains evidence upon which a fair-minded person might be persuaded that Mr. Hooper was the true owner. This inverts the standard of review. The superior court applied this inverted standard of review. An appellate court does not find facts, does not weigh the credibility of witnesses, and does not substitute its own judgment for that of an administrative tribunal on questions of fact. Nguyen v. Dep’t of Health, Med. Quality Assurance Comm’n, 99 Wn. App. 96, 101, 994 P.2d 216
(1999), aff’d, 144 Wn.2d 516, 29 P.3d 689 (2001). Because this court reviews the administrative record and the administrative findings and conclusions on the same basis as the superior court, findings of fact and conclusions of law entered by that court are superfluous. Albertson’s, Inc. v. Employment Sec. Dep’t, 102 Wn. App. 29, 35, 15 P.2d 153
(2000). If the ALJ’s findings are supported by substantial evidence, the reviewing court’s factual inquiry is finished. The appellate court does have the power to substitute its own judgment for that of the administrative agency in matters of law, but not questions of fact. Franklin County Sheriff’s Office v. Sellers, 97 Wn.2d 317, 325, 646 P.2d 113 (1982).
THE INNOCENT OWNER DEFENSE
A conveyance used in an offense involving controlled substances is subject to forfeiture. The vehicle will not, however, be forfeited by reason of an act or omission committed without the owner’s knowledge and consent. RCW 69.50.505(a)(4)(ii). The person asserting the innocent owner defense is entitled to a hearing and appeal. Both are governed by Title 34 RCW. The burden is on the claimant to prove lawful ownership. RCW 69.50.505(e); State v. Michel, 55 Wn. App. 841, 843-44, 781 P.2d 496
(1989). Ownership is the threshold inquiry. Failure to meet this burden defeats standing to raise the innocent owner defense. Commonwealth v. One 1985 Cadillac Seville, 371 Pa. Super. 390, 396, 538 A.2d 71 (1988). Likewise, on appeal, the burden of demonstrating that the ALJ’s decision is not supported by substantial evidence remains with the party asserting error. RCW 34.05.570(1)(a); Oscar’s, Inc. v. Wash. State Liquor Control Bd., 101 Wn. App. 498, 505, 3 P.3d 813 (2000).
Mr. Hooper is correct on one aspect of this case. Evidence could be found in the record to support his position. Mr. Hooper’s name appears on the legal title of the vehicle, and there is no substantial evidence that he was involved in criminal acts. There is evidence that he was a loving and generous father who sometimes loaned vehicles to his daughters. The ALJ might have found that Mr. Hooper’s daughter, Jennifer, a single mother, needed transportation to her job and to take her three children to child care, and that another car loaned to her by Mr. Hooper was not working.
The ALJ might also have found that Mr. Hooper bought the Tahoe in anticipation of moving to Curlew, and that Jennifer’s domestic partner, Eliberto, innocently loaned the car to his brother without Mr. Hooper’s knowledge or permission.
But the ALJ did not believe any of this.
And the record contains substantial evidence to support the City’s theory that Mr. Hooper was merely a straw man. He paid for the vehicle with the Riveras’ cash and turned the vehicle over to them immediately. Eliberto testified he was driving the supposedly inoperable car on the day the Tahoe was purchased. The record amply supports the ALJ’s finding that Mr. Hooper’s witnesses were not to be believed. Federal decisions interpreting the analogous statute, 21 U.S.C. § 881, establish the prevalence of `straw man’ ownership. See, e.g., United States v. $515,060.42 in United States Currency, 152 F.3d 491, 498 (6th Cir. 1998). The courts do not necessarily give weight to possession of bare legal title. In re One 1985 Mercedes Benz Auto., 644 A.2d 423, 430
(Del.Super.Ct. 1992).
The question of ownership is a factual determination of whether the record owner is the true owner or merely a `straw man’ set up to avoid forfeiture. Id. Tribunals often attach significance to a claimant’s inability to document the source of the money, and claims to have kept the cash at home instead of in an existing bank account have been found implausible. Id. at 431.
Mr. Hooper’s claim to have amassed $20,000 that he kept in tin cans was also reasonably viewed as implausible, given his two prior bankruptcies and the fact that he received interest income from his bank for the previous several years. Besides the source of the funds, courts look at who exercised possession and control over the property. United States v. A Single Family Residence, 803 F.2d 625, 630 (11th Cir. 1986). Again here, Mr. Hooper turned over possession to Jennifer almost immediately upon acquiring it. His alleged reason for giving it to her was arguably questionable. Jennifer had transportation. She was driving Mr. Hooper’s old Pontiac, which was operational at the time. Eliberto testified he was driving it when he first saw the Tahoe.[11] The trier of fact — here, the ALJ — must weigh the relevant factors against the credibility of the witnesses. Delegan v. White, 59 Wn.2d 510, 512, 368 P.2d 682 (1962); Crawford v. Welch, 8 Wn. App. 663, 664, 508 P.2d 1039 (1973). This ALJ considered the appropriate factors, including the selection of the Tahoe by the Rivera brothers, the origin of the purchase funds, possession and control of the vehicle, and credibility of the witnesses.
The ALJ’s characterization of the evidence is supported by the City’s exhaustive documentation of the evidentiary inconsistencies that permeate the entire administrative record and overwhelmingly support the ALJ’s assessment.
We need not address the merits of Mr. Hooper’s claim of innocence and ignorance as to the drug dealing. Only the ownership issue is before this court, because once the ALJ made the threshold determination of no ownership, the question of innocence became moot.
We conclude that substantial evidence in the record supports the ALJ’s decision. We therefore reverse the superior court and reinstate the administrative decision.
A majority of the panel has determined that this opinion will not be printed in the Washington Appellate Reports but it will be filed for public record pursuant to RCW 2.06.040.
WE CONCUR: KURTZ, C.J. KATO, J.