11.7Property Subject to Forfeiture

The types of property subject to forfeiture under Article 7 of the PHC are set forth by statute. See MCL 333.7521.

A.Statutory Authority

MCL 333.7521(1) provides: “The following property is subject to forfeiture:

(a) A prescription form, controlled substance, an imitation controlled substance, a controlled substance analogue, or other drug that has been manufactured, distributed, dispensed, used, possessed, or acquired in violation of [Article 7 of the PHC].

(b) A raw material, product, or equipment of any kind that is used, or intended for use, in manufacturing, compounding, processing, delivering, importing, or exporting a controlled substance, a controlled substance analogue, or other drug in violation of [Article 7 of the PHC]; or a raw material, product, or equipment of any kind that is intended for use in manufacturing, compounding, processing, delivering, importing, or exporting an imitation controlled substance in violation of [MCL 333.7341].

(c) Property that is used, or intended for use, as a container for property described in subdivision (a) or (b).

(d) Except as provided in subparagraphs (i) to (iv), a conveyance, including an aircraft, vehicle, or vessel used or intended for use, to transport, or in any manner to facilitate the transportation, for the purpose of sale or receipt of property described in subdivision (a) or (b):

(i) A conveyance used by a person as a common carrier in the transaction of business as a common carrier is not subject to forfeiture unless it appears that the owner or other person in charge of the conveyance is a consenting party or privy to a violation of [Article 7 of the PHC].

(ii) A conveyance is not subject to forfeiture by reason of any act or omission established by the owner of that conveyance to have been committed or omitted without the owner’s knowledge or consent.

(iii) A conveyance is not subject to forfeiture for a violation of [MCL 333.7403(2)(c) (possession of lysergic acid diethylamide, peyote, mescaline, dimethyltryptamine, psilocyn, psilocybin, or a controlled substance classified in schedule 5) or MCL 333.7403(d) (possession of marijuana), MCL 333.7404 (use of a controlled substance), or MCL 333.7341(4) (use or possession with intent to use an imitation controlled substance)].

(iv) A forfeiture of a conveyance encumbered by a bona fide security interest is subject to the interest of the secured party who neither had knowledge of nor consented to the act or omission.

(e) Books, records, and research products and materials, including formulas, microfilm, tapes, and data used, or intended for use, in violation of [Article 7 of the PHC].

(f) Any thing of value that is furnished or intended to be furnished in exchange for a controlled substance, an imitation controlled substance, or other drug in violation of [Article 7 of the PHC] that is traceable to an exchange for a controlled substance, an imitation controlled substance, or other drug in violation of [Article 7 of the PHC] or that is used or intended to be used to facilitate any violation of [Article 7 of the PHC] including, but not limited to, money,^[1] negotiable instruments, or securities. To the extent of the interest of an owner, a thing of value is not subject to forfeiture under this subdivision by reason of any act or omission that is established by the owner of the item to have been committed or omitted without the owner’s knowledge or consent. Any money that is found in close proximity to any property that is subject to forfeiture under subdivision (a), (b), (c), (d), or (e) is presumed to be subject to forfeiture under this subdivision. This presumption may be rebutted by clear and convincing evidence.

(g) Any other drug paraphernalia not described in subdivision (b) or (c).”

B.The Substantial Connection Test

There must be a substantial connection between the seized property and the prohibited activity in order to forfeit the property under MCL 333.7521(1)(c) (containers), MCL 333.7521(1)(d) (conveyances), or MCL 333.7521(1)(f) (real property). In re Forfeiture of 2000 GMC Denali and Contents, 316 Mich App 562, 584 (2016); In re Forfeiture of 19203 Albany, 210 Mich App 337, 342 (1995); In re Forfeiture of $5,264, 432 Mich 242, 262 (1989). “Property that only has an incidental or fortuitous connection to the unlawful activity is not subject to forfeiture.” In re Forfeiture of 2000 GMC Denali and Contents, 316 Mich App at 584.

Some examples of cases applying the substantial connection test include:

•“[M]ore than a substantial connection between the underlying [unlawful] activity and the [forfeited] Denali and the motorcycle” was established where an officer testified that he had observed an individual well-known for drug dealing in both the Denali and the motorcycle while dealing drugs. In re Forfeiture of 2000 GMC Denali and Contents, 316 Mich App at 585.

•A substantial connection, under § 7521(1)(c) and § 7521(1)(f), between the home and underlying illegal transactions warranting forfeiture was established where the evidence showed that 17 pounds of marijuana were located throughout a home, records in the claimant’s bedroom suggested that approximately 27 customers owed him $20,000 for marijuana, an affiant stated that he purchased marijuana from the claimant and that the home was used for many of the transactions, and drug-packaging paraphernalia was found in the home. In re Forfeiture of 5118 Indian Garden Rd, 253 Mich App 255, 257-258 (2002).

•A substantial connection between cash found in the ceiling of the claimant-father’s basement and drug trafficking warranting forfeiture under § 7521(1)(f) was established where the claimant-son, who was involved in drug trafficking, had access to the claimant-father’s house, collected mail at the house, registered his vehicles to the claimant-father’s address, and the investigating officers testified that the claimant-father was surprised when he learned of the cash found in his basement. In re Forfeiture of $25,505, 220 Mich App 572, 575 (1996). However, there was insufficient evidence of a substantial connection between forfeited furniture and drug trafficking where the furniture was discovered in the claimant-son’s apartment and a police officer testified that “he assumed that the furniture was the proceeds of the drug trafficking because [the claimant-son] had been unemployed for some time when arrested.” Id. at 576. “This [was] mere supposition and insufficient to establish that [the claimant-son] used drug proceeds to purchase the furniture.” Id. The Court explained that “a prosecutor might meet [the] burden [of establishing a substantial connection] by presenting evidence showing that a claimant purchased the property at issue at a time when he had no alternative source of income or savings other than drug trafficking. Evidence regarding the value of seized property, the manner of payment therefore, and the connection in time of such purchases to drug deals may also aid the prosecution in meeting its burden.” Id.

•A substantial connection between a mobile home and the sale of marijuana was established warranting forfeiture under § 7521(1)(f) where small amounts of marijuana were seized during two separate searches of the mobile home, the person who sold marijuana to the undercover officer talked to the claimant (who owned the mobile home) on the phone in order to obtain marijuana and then entered the mobile home and returned with marijuana for the undercover officer, a search of the mobile home uncovered the marked $20 bills used to buy the marijuana, drug paraphernalia indicative of drug dealing such as scales and plastic bags were discovered in the mobile home, stems and seeds were found in the claimant’s garbage, and the claimant admitted to selling marijuana from the mobile home. In re Forfeiture of One 1978 Sterling Mobile Home, 205 Mich App 427, 430-431 (1994).

•A substantial connection between the seized property and drug trafficking was established warranting forfeiture under § 7521(1)(f) where the prosecution relied on a net-worth theory that the claimant, a retired factory worker, was a drug trafficker, and his unexplained increase in net worth from 1983 to 1989 demonstrated that the later-acquired assets were associated with drug dealing. In re Forfeiture of $1,159,420, 194 Mich App 134, 146-147 (1992). The Court noted that it did not agree with the claimant’s argument “that a connection with a specific incident of drug dealing must be shown for each asset[.]” Id. at 147. Rather, the Court held that “the assets need only be traceable to drug trafficking.” Id. 

C.Forfeiture of Real Property Under § 7521(1)(c)

“Property that is used, or intended for use, as a container for [property subject to forfeiture under MCL 333.7521(1)(a)-(b),]” is subject to forfeiture under MCL 333.7521(1)(c). This provision has been interpreted to include real property within the meaning of the term container. In re Forfeiture of 19203 Albany, 210 Mich App 337, 340, 343 (1995). The Court explained that while some controlled substances are “easily secreted in small portable containers like a box, crate, can or jar, other controlled substances such as marijuana require larger containers for storage.” Id. at 341 (citation omitted). Thus, “whether or not a particular dwelling house is a ‘container’ within the provisions of [MCL 333.7521(1)(c)] is a question of fact for the trial court to determine.” In re Forfeiture of 19203 Albany, 210 Mich at 341 (citation omitted). The Court held that “upon proof by a preponderance of the evidence^[2] that real property subject to forfeiture has a substantial nexus to illegal drug activity, such that the property constitutes a ‘container’ under [MCL 333.7521(1)(c)] of [Article 7 of the PHC], a court may order a forfeiture of that real property.” In re Forfeiture of 19203 Albany, 210 Mich at 342. This “substantial nexus” test is the same as the substantial connection test used in the context of forfeiture under § 7521(1)(f); see Section 11.7(B) for further discussion of the substantial connection test.

D.Forfeiture of Conveyances Under § 7521(1)(d)

A vehicle is not properly forfeited as a conveyance under MCL 333.7521(1)(d) where it “may have been used to facilitate the sale or receipt of a controlled substance not by actual transportation of the controlled substance to a customer but rather by transportation of the customer to the controlled substance.” In re Forfeiture of One 1987 Chevrolet Blazer, 183 Mich App 182, 185 (1990) (holding that forfeiture was instead permissible under MCL 333.7521(1)(f) because that section “addresses contingencies in addition to those provided for in § 7521(1)(d)[]”).

The trial court erred by failing to forfeit a automobile under MCL 333.7521(1)(d) where three witnesses testified that they saw the respondent collect money from cocaine sales and distribute cocaine while driving the automobile. In re Forfeiture of United States Currency, 164 Mich App 171, 174-175, 179 (1987). While the automobile was titled in Vivian Turner’s name, not the respondent’s, there was “significant documentary evidence that placing the title in Turner’s name was a mere subterfuge.” Id. at 179-180. Further, the automobile was registered at an address where the respondent never lived, and testimony showed that respondent and Turner lived together and purchased the automobile together. Id. at 180. Thus, “[t]he mere placing of the automobile in Ms. Turner’s name [did not] prevent forfeiture.” Id.

A vehicle is not subject to forfeiture under MCL 333.7521(1)(d), which “requires that a vehicle be used or intended to be used for the transportation of materials specified within the statute for the purpose of their sale or receipt.” In re Forfeiture of 2006 Saturn Ion, ___ Mich ___, ___ (2024). “The statute covers: (1) a conveyance that is (2) used or intended to be used to (3) transport or facilitate the transportation (4) for the purpose of the sale or receipt of (5) property described in MCL 333.7521(1)(a) or (b).” In re Forfeiture of 2006 Saturn Ion, ___ Mich at ___, citing MCL 333.7521(1)(d). “[A]ll of these elements must be fulfilled simultaneously—there must be a conveyance used or intended to be used to transport illicit property that will be sold or received.” In re Forfeiture of 2006 Saturn Ion, ___ Mich at ___. The Court noted that “MCL 333.7521(1)(d) requires that a vehicle be used or intended to be used for the transportation of materials specified within the statute for the purpose of their sale or receipt before a forfeiture may be effected. In re Forfeiture of 2006 Saturn Ion, ___ Mich at ___. Accordingly, the facts in this case “do not support an inference that the defendant vehicle was used or intended to be used to transport illicit materials for their sale or receipt.” Id.

“[M]ore than a substantial connection between the underlying [unlawful] activity and the [forfeited vehicle] and the motorcycle” was established where an officer testified that he had observed an individual well-known for drug dealing in both the vehicle and the motorcycle while that individual was dealing drugs. In re Forfeiture of 2000 GMC Denali and Contents, 316 Mich App 562, 585 (2016).

For a detailed discussion of the statutory exceptions to forfeiture of a conveyance, see Section 11.14(A).

E.Forfeiture Under § 7521(1)(f)

MCL 333.7521(1)(f) permits the forfeiture of several different types of property, including:

•“Any thing of value that is furnished or intended to be furnished in exchange for a controlled substance, an imitation controlled substance, or other drug in violation of [Article 7 of the PHC] that is traceable to an exchange for [one of the aforementioned substances].”

•Any thing of value that is used or intended to be used to facilitate any violation of Article 7 of the PHC.

•Money found in close proximity to property that is subject to forfeiture under MCL 333.7521(1)(a)-(e) is presumed to be subject to forfeiture, but this presumption may be rebutted by clear and convincing evidence.

•“[A] thing of value is not subject to forfeiture under [MCL 333.7521(1)(f)] by reason of any act or omission that is established by the owner of the item to have been committed or omitted without the owner’s knowledge or consent.” This innocent owner defense to forfeiture is discussed in detail in Section 11.14(B).

1.Facilitation of Any Violation of Article 7 of the PHC Under § 7521(1)(f)

Forfeiture of a vehicle is proper under MCL 333.7521(1)(f) as “any thing of value” used to facilitate a violation of Article 7 of the PHC if the prosecution can prove a substantial connection between the property and the alleged criminal activity. In re Forfeiture of One 1987 Chevrolet Blazer, 183 Mich App 182, 185 (1990) (reversing the trial court’s order of dismissal in a proceeding to forfeit a vehicle that was used only to transport individuals to locations where they could purchase controlled substances, but not used to transport any actual controlled substances). The Court explained that there was no conflict between MCL 333.7521(1)(d), which permits the forfeiture of a vehicle used to transport a controlled substance, and MCL 333.7521(1)(f), which permits forfeiture of any thing of value used to facilitate any violation of Article 7 of PHC because “§ 7521(f) addresses contingencies in addition to those provided for in § 7521(1)(d), such as here, where the [vehicle] may have been used to facilitate the sale or receipt of a controlled substance not by actual transportation of the controlled substance to a customer but rather by transportation of the customer to the controlled substance.” In re Forfeiture of One 1987 Chevrolet Blazer, 183 Mich App at 185.

2.Money Found in Close Proximity to Drugs

“No connection between the money and claimant’s alleged illegal drug activity need be established before the proximity presumption of our state statute can be invoked.” In re Forfeiture of $111,144, 191 Mich App 524, 534 (1992). Rather, the prosecutor need only demonstrate that the money was actually found in close proximity to property subject to forfeiture under Article 7 of the PHC. See In re Forfeiture of $18,000, 189 Mich App 1, 3-4 (1991) (holding, however, that the presumption did not apply where “it [was] undisputed that the money at issue was not found in close proximity to [the drugs]”).

Several cases have considered whether money found in close proximity to property subject to forfeiture was properly forfeited, for example:

•Money seized from the claimant was properly forfeited under the close proximity provision of § 7521(1)(f), where the claimant had the cash on his person and was standing next to a person caught with cocaine in an amount suggestive of drug dealing, had the cash stacked in a way common for drug dealers, and had his claim about changing bills at a store refuted by testimony from the owners of the store. In re Forfeiture of $275, 227 Mich App 462, 464-466, 471 (1998) (Smolenski, J., dissenting), rev’d by 457 Mich 864 (1998) (reversing for the reasons stated in the dissenting opinion in the Court of Appeals case³).

•The trial court erred by forfeiting money under the close proximity provision of § 7521(1)(f) because there was not a substantial connection between the money and cocaine where the only evidence linking the money to an exchange for a controlled substance was the fact that a narcotics dog smelled the odor of cocaine on the bills and there was also evidence that the claimant withdrew the money from a bank before posting the money for bond. In re Forfeiture of $18,000, 189 Mich App at 5. The Court noted that in the absence of actually finding the money in close proximity to property subject to forfeiture, the mere fact that money may once have been in close proximity to property subject to forfeiture did not justify application of the close proximity presumption. Id.

•Forfeiture proceedings were commenced under the close proximity provision of § 7521(1)(f) after the defendant was arrested and several checks were found on his person in close proximity to marijuana. In re Forfeiture of $111,144, 191 Mich App 524, 526, 534 (1992). The Court held, in dicta, that checks are to be considered “money” for purposes of the close proximity presumption in § 7521(1)(f). In re Forfeiture of $111,144, 191 Mich App at 531 n 1. The Court further rejected the claimant’s argument that the prosecution had to establish a connection between the checks and illegal drug activity, holding that “[n]o connection between the money and claimant’s alleged illegal drug activity need be established before the proximity presumption [of MCL 333.7521(1)(f)] can be invoked.” In re Forfeiture of $111,144, 191 Mich App at 534.⁴

•Where $4,082 in cash was discovered on the claimant, who was standing two to three feet from a still-flushing toilet from which a ripped plastic bag that was later determined to have contained cocaine was recovered, the forfeiture of the cash under the close proximity provision of § 7521(1)(f) was proper. People v United States Currency, 158 Mich App 126, 128, 131 (1986).