Calero-Toledo v. Pearson Yacht Leasing Co., 416 U.S. 663 (1974)

Federal and state laws authorize the government to seize and forfeit property that is ‘‘tainted’’ by its connection to specified crimes. In Calero-Toledo, the Supreme Court addressed, albeit ambiguously, the question of whether the Constitution’s due process clause protects an ‘‘innocent owner’’ from forfeiture when her property was illegally used without her knowledge or consent. Citing a number of precedents, the Court upheld the civil forfeiture of a rented yacht after a marijuana cigarette was discovered onboard, even though the yacht’s owner was innocent of wrongdoing and ignorant of the renters’ illegal activity. Justice Brennan’s opinion for the Court found forfeiture against the unwitting lessor rational, because it could induce owners to exercise greater care in transferring possession of their property. However, the opinion included dicta implying that the Constitution might mandate a narrower innocent owner defense, protecting owners who are not only unaware of the wrongful activity, but also have done everything ‘‘that reasonably could be expected’’ to prevent it.

On the basis of this language, some lower courts found a limited constitutional defense for owners who are both unknowing and non-negligent regarding the illegal use of their property. However, in Bennis v. Michigan (1996), the Supreme Court reaffirmed Caldero-Toledo with an even broader holding that dropped all reference to any circumstances that might constitutionally protect an unwitting and nonnegligent owner. Bennis did not know of, and could not prevent, her husband from using their car for sex with a prostitute, but the Court held five to four that she had no constitutional protection against forfeiture of her interest in the automobile.

Despite the Calero-Toledo and Bennis cases, innocent owners have alternative remedies. Statutory innocent owner defenses have found their way into several forfeiture laws, and the Civil Asset Forfeiture Reform Act of 2000 creates a uniform innocent owner defense applicable to most federal forfeiture procedures. Moreover, federal and most state laws allow for administrative remission or mitigation of unduly severe forfeitures. Finally, the Supreme Court has held that the Eighth Amendment’s excessive fines clause applies to forfeitures, and the Court has yet to decide whether subjecting an innocent owner to forfeiture of her property is necessarily excessive.

Caldero-Toledo also found no constitutional violation in the government’s denial of notice or a hearing to the owner until after its seizure of the yacht. The Court subsequently modified this holding in United States v. James Daniel Good Real Property et al. (1993), finding that a preseizure notice and hearing is required for land, houses, and other real property, because in such cases, advanced notice cannot create a risk that the property will be removed from the jurisdiction.

ERIC D. BLUMENSON

References and Further Reading

• Department of Justice. Asset Forfeiture Law and Practice Manual. June 1998
• Kessler, Steven L. Civil and Criminal Forfeiture: Federal and State Practice §6.01, 1993
• Smith, David B. Prosecution and Defense of Forfeiture Cases. Matthew Bender

Cases and Statutes Cited

• Bennis v. Michigan, 516 U.S. 442 (1996) 
• United States v. James Daniel Good Real Property et al., 510 U.S. 43 (1993) 

See also Civil Asset Forfeiture; Due Process; United States v. 92 Buena Vista Avenue, 507 U.S. 111 (1993)