SENATE COMMITTEE ON JUDICIARY

MINUTES OF THE

SENATE Committee on Judiciary

Seventy-First Session

February 20, 2001

The Senate Committee on Judiciarywas called to order by Chairman Mark A. James, at 8:30 a.m., on Tuesday, February 20, 2001, in Room 2149 of the Legislative Building, Carson City, Nevada. The meeting was videoconferenced to the Grant Sawyer State Office Building, Room 4401, Las Vegas, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Senator Mark A. James, Chairman

Senator Jon C. Porter, Vice Chairman

Senator Mike McGinness

Senator Maurice Washington

Senator Dina Titus

Senator Valerie Wiener

Senator Terry Care

STAFF MEMBERS PRESENT:

Bradley A. Wilkinson, Committee Counsel

Allison Combs, Committee Policy Analyst

Heather Dion, Committee Secretary

OTHERS PRESENT:

Ed Gobel, Lobbyist, President, Council of Nevada Veterans Organizations

Robert W. Mulvana, Lobbyist, Curator, Ye Public Morgue

Todd Torvinen, Concerned Citizen, Attorney,

Ben Graham, Lobbyist, Clark County District Attorney

Kathleen Buchanan, Public Guardian, Assistant Public Administrator, Clark County

Jennifer Henry, Guardianship/Domestic Discovery Commissioner, Eighth Judicial District Court

Harriet Roland, Elder Law Section, State Bar of Nevada

Don Cavallo, Public Administrator, Washoe County

Henry Cavallera, Attorney, Elder Care Law

Kim Spoon, Concerned Citizen

James J. Jackson, Lobbyist, Attorney, Nevada Attorneys for Criminal Justice

John C. Morrow, Lobbyist, Washoe County Public Defender

Bruce Judd, Attorney, Las Vegas

William T. Walters, Chairman and Chief Executive Officer, Walters Group

Janine Hansen, Lobbyist, Nevada Eagle Forum

Bernard B. Zadrowski, Deputy District Attorney, Clark County

James F. Nadeau, Lobbyist, Captain, Legislative Liaison, Washoe County Sheriff’s Office

Stan Olsen, Lobbyist, Lieutenant, Government Liaison, Las Vegas Metropolitan Police Department

Lin T. Ng, Deputy City Attorney, City of Henderson

Chairman James opened the meeting with the first item of discussion, Bill Draft Request (BDR) 7-628. Chairman James asked for a motion to introduce BDR 7‑628.

BILL DRAFT REQUEST (BDR) 7-628: Revises various provisions governing the filing of organizational and related documents. (Later introduced as Senate Bill 217.)

SENATOR PORTER MOVED TO INTRODUCE BDR 7-628.

SENATOR CARE SECONDED THE MOTION.

THE MOTION CARRIED UNANIMOUSLY.

*****

Chairman James opened the hearing on Senate Bill (S.B.) 34.

SENATE BILL 34: Revises provisions relating to appointment of temporary guardians. (BDR 13-1070)

Ed Gobel, Lobbyist, President, Council of Nevada Veterans Organizations, addressed the committee. Mr. Gobel spoke for the council, “as many veterans and members of the community who have fought for the country.” Mr. Gobel said the council was testifying in issues of freedom. He stated the council believes that freedom should not be taken away on “someone’s say so,” as the bill addresses a basic issue of freedom.

Mr. Gobel recalled his testimony from the previous session in the Assembly Committee on Judiciary, where the same issues were addressed. As the law currently exists, Chapter 159 of Nevada Revised Statutes (NRS), any person can give a medical opinion that concludes an individual is incapable of handling their financial affairs, stated Mr. Gobel.

Mr. Gobel continued his testimony, stating that William O. Voy, District Judge, Family Division, Department A, Eighth Judicial District Court, had testified that he would accept a petition 9 times out of 10 concerning individuals who are incapable of handling their financial affairs. However, it is the opinion of Mr. Gobel that these medical opinions may not be valid. Therefore, an opinion by an unqualified individual should not be allowed to hold validity in court.

In the current bill, the subject is temporary guardianship without notice to the subject of the temporary guardianship. Mr. Gobel gave an example of a Reno attorney who had spoken in regards to a man who had earned a great amount of money, and was also widowed. His remaining children were dissatisfied with his choice of relations, and the manner of which he was spending his money. Mr. Gobel stated that the money spent was an estimated $15,000. However, when the remaining children attempted to find a physician to certify the man unable to handle personal finances, they discovered a list of unwilling physicians. Without the note from a physician, the remaining children were unable to receive temporary guardianship, or responsibility for their father’s financial matters.

District Judge Voy testified at the hearing of the aforementioned man, Mr. Gobel said, adding that District Judge Voy had stated in his testimony that he was the guardianship judge at the time for Clark County. He said Judge Voy also testified that he “did not see frequent abuse of the current system, but there was room in the existing statute for abuse to occur.” Mr. Goble continued, saying Judge Voy stated in his testimony that “temporary guardianship does not require medical documentation.” Judge Voy averred he does believe that such documentation is needed, stated Mr. Gobel, reading from the minutes of the hearing.

Mr. Gobel continued his testimony by stating that NRS Chapter 159 is not restricted to family members and currently allows anyone to note a medical condition, even while they may not be qualified to do so. He went on to testify that the issue was that a person’s constitutional rights were being ignored by allowing any medical opinion to have validity. Mr. Gobel said he believes that this statute, in its current form, subjects the persons involved to unnecessary processes. Furthermore, particular qualifications such as licensing need to be implemented into the statute to protect individuals.

Mr. Gobel expressed concerns that S.B. 34 needs special attention between legislative sessions as an interim study. Senator James supported Mr. Gobel’s claim, stating only one individual had contacted him since his initial request of the bill.

Senator Wiener questioned the controversy that arose from the Assembly Committee on Judiciary the previous session, which caused the bill to die. Senator James replied the information was in the minutes of the Assembly Committee on Judiciary, and asked Mr. Gobel who exactly was the person who testified in opposition of the bill. Mr. Gobel stated that those in opposition were the Reno attorney, in the case of the older man, and his remaining children.

Mr. Gobel went on to conclude that his opinion of opposition was based on the idea that “this bill would help to protect a person against unscrupulous individuals.” However, the changes proposed would also make the process of finding a doctor to certify an individual incapable more difficult.

Robert W. Mulvana, Lobbyist, Ye Public Morgue, came forward to testify on S.B. 34. Mr. Mulvana stated he was representing Colleen Nelson, who was found incapable by a physician and faced the difficulties of temporary guardianship. Mr. Mulvana stated that Ms. Nelson is currently 76 years old. She has experienced health problems, lost her driver’s license, and found trouble with health care services. Ms. Nelson also has an estranged relationship with her four children.

Mr. Mulvana proceeded to testify that Ms. Nelson was admitted to Saint Mary’s Hospital in Reno. During her stay, her children had contacted a guardianship firm, a private fiduciary. Once the contact had been established, the children, with the assistance of the private fiduciary, had Ms. Nelson moved to Northern Nevada Medical Center, Senior Bridges, where Ms. Nelson remained for a month. At month’s end, she was then transferred to an assisted living facility, stated Mr. Mulvana.

Mr. Mulvana testified that he understood the current NRS Chapter 159 to state that the ward is entitled to be present at the court proceeding. A letter submitted to the court, written by the attending physician at Senior Bridges, documented that Ms. Nelson was incapacitated. Mr. Mulvana said he had contacted Ms. Nelson 10 days after her admittance and found her to be “doped up” and incoherent. After a time Mr. Mulvana realized that her medication was being reduced. Nevertheless, Ms. Nelson did receive a confirmation that she was competent, he stated.

Mr. Mulvana stated that once Ms. Nelson was found to be competent, the guardian withdrew his previous petition. However, because of the petition, Ms. Nelson suffered monetary loss and personal item loss. Mr. Mulvana concluded his testimony, stating that there should be more scrutiny about how a person is to be found incompetent.

Mr. Mulvana referred to his submittal of changes proposed to the current statute (Exhibit C). He said he believes that from his experience with the case of Ms. Nelson his proposals would help to avoid similar situations that may occur.

Todd Torvinen, concerned citizen and attorney, came forward to testify on behalf of Nevada Trial Lawyers Association (NTLA) to oppose S.B. 34. Mr. Torvinen stated opposition to the bill because of the chance for unintended consequences. Nevada Trial Lawyers Association believes that the bill could wind up being a danger to minor children, commented Mr. Torvinen. The bill as it exists currently does not distinguish between adult proposed wards and minor proposed wards.

Mr. Torvinen gave the example of the statute being used by grandparents who are trying to obtain temporary guardianship over their grandchildren. Typically in such a case, Mr. Torvinen described, a parent has gone on a “drug runner” or “alcohol runner” and is endangering the child. In this instance, an affidavit from a physician that states the child is in danger would be difficult to come by. Therefore, Mr. Torvinen stated, he believes such a situation would create an impediment and could actually then endanger the child.

Senator James asked Mr. Torvinen to clarify his distinction between physical harm and immediate medical attention. Senator James also asked if the amendment to the bill would include, if there was physical harm, if there would not be the need for an affidavit from a physician.

Mr. Torvinen clarified his response, stating if the requirement [the affidavit] did not apply to minors then the endangerment would not apply, as the bill currently exists. Senator James questioned if “it would be impossible for a grandparent to get an affidavit from a doctor stating a child needed medical attention.” Mr. Torvinen replied, yes, this could be the case because the grandparent may not have physical possession of the child to get him or her to a physician.

Senator James expressed concern that under the existing statute an affidavit could be written to get control of a person and their property, saying that person is at risk of immediate harm or danger and given to the court. The statute does not require giving notice to the person, nor does that person have to be at the court proceeding. Senator James continued, suggesting that the statute may be too broad and the NTLA may want to assist in rewording it.

Mr. Torvinen stated that he understood Senator James’ concern for an adult ward; however, the NTLA is attempting to change the statute for a minor child ward where the existing statute could endanger children. Senator James responded, stating that there are many other existing statutes that protect children through particular agencies [child and family services and government agencies], and there may be a circumstance where the parent is not on a “bender,” and the grandparent simply wants control. In these instances, the parents should be allowed to express their feelings on the issue, commented Senator James.

Mr. Torvinen responded he realized that Senator James has a concern but as the statute is currently written, there is a requirement that directs the petitioner to state specific facts and present it to a judge. Senator James resumed his response, stating that the petitioner has to state they “tried in good faith to notify the persons entitled to notice,” and this was not sufficient. He believed that there was room under the current statute for abuse, and it needed work and revision.

Ben Graham, Lobbyist, Clark Country District Attorney, stated he had some involvement in this process of mental commitments through district attorney petitions through his own unit. Mr. Graham stated more than 1000 petitions a year take place. And to protect the families and the proposed individual for whom assistance is needed, a long and thought-out process is involved. Mr. Graham said that abuse is found occasionally, but there are hundreds of cases where individuals need assistance, and the petitions provide this assistance.

Mr. Graham introduced Kathleen Buchanan, Public Guardian, Assistant Public Administrator, Clark County, and Harriet Roland, Elder Law Section, State Bar of Nevada.

Ms. Buchanan addressed the committee and stated she wished to read into the record written testimony. She also referenced a letter to Ms. Buchanan (Exhibit D) submitted by Patricia Trent, Attorney, Las Vegas, referring to the problems under the current statute. Ms. Buchanan read into the record:

The Clark County public guardian’s office opposes this bill, Senate Bill 34, in its present form. The public guardian’s office currently manages more than 700 individuals in the guardianship program, many of whom are unable to respond to risk of harm or to obtain the necessary medical attention prior to our appointment. Our office receives and responds to numerous emergency referrals on a weekly basis. Many of these victims are senior citizens who lack the capacity to recognize their own compromised medical condition and, therefore, are unable to protect themselves or their financial affairs.

In reviewing S.B. 34, section 1, subsection 2(b), it appears that not only must the opening petition contain an allegation the ward faces an immediate risk of harm or needs immediate medical attention concerning which he or she lacks the capacity to recognize or manage. But, also this assertion must be confirmed by an accompanying physician’s or psychological certificate. We suggest the language requiring the certificate be deleted from the bill. The problem inherent in most temporary guardianships involves an exploiter and a victim.

The risk of harm is numerous and varied, as well as are there reasons for medical attention. Time is of the essence in these situations. Not only may wrongful action take place while efforts are under way to find a physician who can examine the ward, but the exploiter may accelerate the unthinkable and abscond if it is learned that a physician has been or is about to be contacted. Furthermore, physicians typically do not make house calls. Limiting the ability to obtain recommended physician’s certificate and those handful of physicians will encounter a senior citizen who refuses to open the door or the exploiter who refuses them entrance.

Professionals in the community, who work with these concerns daily, recognize the at-risk population will be at further risk if the new language is adopted. As early as last week, we petitioned for temporary guardianship on an 87-year-old, who was a victim of elder abuse and financial exploitation by a woman 40 years his junior. He was found dehydrated and malnourished. She had obtained power of attorney over his affairs, and was in the process of transferring his real property into her name, as well as depleting his financial assets.

Senator James interrupted Ms. Buchanan during her testimony to comment that the change in wording would not affect the aforementioned case because, he stated, the criteria listed are facts showing “substantial and immediate risk of financial loss,” and therefore “lacks capacity to respond” to the loss. The certificate needed only states that if it is alleged that the ward is at the risk of physical harm or needs medical attention and lacks capacity to respond, then the certificate is needed. However, the statute does not state anything about financial loss.

Senator James continued, saying that he is very familiar with the issue at hand and asking why it is difficult to get someone to state that a person is in need of medical attention. Ms. Buchanan responded that often the individuals are unable to recognize the world around them or state who is their exploiter. She went on to reinforce the idea that the man described in the written testimony was dehydrated and malnourished, and that the exploiter in the case would not let the physician see him.

Ms. Buchanan questioned the agency’s jurisdiction in cases such as described, and said it was difficult to obtain the medical certificate necessary for the court petition. Senator James replied that in the aforementioned case, the certificate would not have been needed because of the financial loss, and there are other statutes that deal with financial loss. He went on to state that possibly the part of the bill that should be amended is the area dealing with physical harm. The revision would state that the certificate is needed if there is need for immediate medical attention, which leads to the immediate risk of physical harm to the ward. The purpose of the bill, stated Senator James, is to circumscribe this power to avoid the abuse that is possible.

Jennifer Henry, Guardianship/Domestic Discovery Commissioner, Eighth Judicial District Court, testifying via videoconference from Las Vegas, addressed that there would be a problem of standing. She continued, stating if a person is not given the ability in the statutes to take an individual to get a certificate then there is not standing to force the appointment or the doctor to release the information.

Senator Care questioned the standing issue, asking Ms. Henry if the courts look for a nexus between the petitioner and the person who is sought to be protected. Ms. Henry answered that, yes, there is a standing order, which is preference set forth in statute. She said the court, as the reviewing entity, is looking for an individual who has standing, and then is given preference by law. These individuals include spouses, blood relatives, relatives by marriage, public guardians, and friends.

Harriet Roland, Elder Law Section, State Bar of Nevada, stated she opposed the statute in its current form. Ms. Roland said that she believes there is an overlap between financial exploitation and physical neglect. In her experience, she said, she sees family members often as the worst abusers. Senator James commented that often these same family members are the individuals who are attempting to get themselves appointed as the guardians. Ms. Roland agreed, and stated she thought the courts were now sensitive to these issues.

Ms. Roland said that when the financial abuse goes hand in hand with the neglect, there is generally an isolation of the senior citizen. Typically, the abuser or exploiter cuts off relations with other family members or friends. Procedurally, the safeguards are in effect to help prevent such instances. She pointed out that if an exploiter brings a guardianship to the court the court would look closely at the circumstances. Also, she said, the guardianship is done through an affidavit, under penalty of perjury, and the court is to require notice, unless a showing can be made where no notice can be given.

Ms. Roland asked the committee how it is possible to get a senior citizen to a physician to obtain the medical certification necessary to get the temporary guardianship in place, which would treat the person. Senator James responded that the question referred back to the standing issue, which had little validity. He stated that she is referring to the idea of “now we do not need anything, but we have standing.” However, if the statute contains the provision that a physician’s certificate is required to validate an allegation that is made, the standing is already present in the statute, he said.

Ms. Roland continued that the issue is analogous to a temporary injunction where there is a 10-day procedure and due process is a concern. Further, she stated, “the protections are built into the legislation, and after 10 days there is a full hearing, if required, on the issues.” The authority that the temporary guardian has been given, per the statute, has been limited to that required to respond in the emergency. After the 10-day period the petitioner must present clear and convincing evidence of why the temporary guardianship should continue, stated Ms. Roland.

Senator James replied that currently in the statute, the example given by Ms. Roland does not state a certificate from a physician is to be obtained. He suggested changing the statute to state, as does a temporary restraining order, “within the allotted time period a certificate must be obtained.” Moreover, if a certificate could not be obtained within the 10-day period, there may be a problem with the petition, he said.

Ms. Henry asked the committee if they had the letter submitted by District Judge Voy (Exhibit E). Judge Voy’s letter stated he believes “the effect of the bill will cause significant, unforeseen, and irreversible harm to our state’s population.” Senator James replied the committee had received the letter.

Ms. Henry referred to the 10-day period that had been discussed by Senator James and Ms. Roland, believing that a problem could occur with the 10-day period, if it was not possible to get the elder person to the physician for the certificate in the period of time allotted.

Senator James stated that it is a due process issue. If the facts are present to support the guardianship itself, the time frame, referred to by Ms. Henry, needs to approximate the 10 days and can be extended, for various reasons, because of an exigency, which pertains to the concern of the lack of evidence.

Ms. Henry referred to Nevada as the “wild west,” referring to the lack of prophylactic measures in place to protect the individuals who are facing a guardianship or who have come under a guardianship. Also, she said, she has many suggestions to help change the current statutes. However, she warned the changes would cost money at the county level. Ms. Henry asked for Senator James’ word that he would not go forward on the issue until work has been done to meet a resolution. Senator James agreed to help alleviate the problems with the help of Ms. Henry.

Chairman James called upon Don Cavallo, Public Administrator, Washoe County, who addressed the committee to oppose S.B. 34. Mr. Cavallo remarked on previous testimony that was heard, and said that in Mr. Mulvana’s case he did have a physician’s certification notice with the petition, yet the damage continued.

Mr. Cavallo stated that in Washoe County attempts are being made to do more to protect individuals by getting psychiatric evaluations, psychology reports, and other types of documents that support the need to take civil rights away. Secondly, Mr. Cavallo echoed the concern of time frames, as it is often difficult to get an elder in to see a physician. He suggested moving the 10-day period to 30 days. Many of the elders referred to have not seen a physician in 10 or 15 years, and have to see a new physician, he said. Furthermore, the cost of medical work (tests) can be a difficultly for many seniors. If they are under Medicaid, many physicians will not take them as patients. Third, Mr. Cavallo stated that he was unaware of any physicians who would go out into the community to see a patient. He stated support of his claim by referring to the outlying areas of Nevada, such as Ely and Elko, and the difficulties of the elderly in these areas.

Henry Cavallera, Attorney, Elder Care Law, stated that he endorsed the comments of Ms. Roland that the situations, even if limited to the area of physical harm and medical attention, physicians and protective services may find the individual fit. However, family members and friends may find areas in the individual, which make them unfit to care for their personal finances. Examples given by Mr. Cavallera ranged from being unable to balance a checkbook or to recognize the need to eat.

In these instances described, Mr. Cavallera had taken the case before a judge and asked for a specialized exam, although he did not have the certificate. In the case aforementioned the individual was granted the exam and given the care he needed. Mr. Cavallera said he believes that if the statute was amended to include the possibility for further evaluation with the ability to extend the time frame, the statute would be more helpful.

Kim Spoon, Concerned Citizen, private guardian and fiduciary, geriatric care manager, submitted her written testimony because she was unable to attend the hearing on S.B. 34 (Exhibit F. Original is on file in the Research Library.). Ms. Spoon’s written testimony pointed out she was concerned about the documentation that limits the ability to obtain guardianship for those proposed wards who are unwilling to see a doctor or psychologist in order to have the certificate signed.

Chairman James closed the hearing on S.B 34, opening the hearing on S.B. 36.

SENATE BILL 36: Changes standard of proof in proceeding for forfeiture of property. (BDR 14-14)

Senator James began the introductory comments on S.B. 36, stating he was the individual who requested the drafting of the bill. He said that he does not practice in the area of criminal law, and never has. The education he does have in the area came from law school, and then from serving for five sessions as the chairman for the Senate Committee on Judiciary, dealing with criminal justice issues.

Senator James stated, “There is a constitutional mandate that an individual not be deprived of their life, liberty, or property without due process of law. The mandate is contained in the Fifth Amendment, and becomes applicable to the states through the Fourteenth Amendment. State constitutional provisions adopt and elaborate upon the concept.” Just what is due process of law that is required before one is deprived of their life, liberty, or property? The deprivation is different in different cases. He continued that it has been decided that before one can be deprived of their life or liberty there be a criminal trial, judged by a jury in all circumstances.

Senator James said in a criminal trial guilt must be proven beyond a reasonable doubt. The standard begins with proof in certain types of cases, always civil cases, where life and liberty are not at stake, just property. In these civil cases there is a “preponderance of the evidence” standard.

Senator James continued with his remarks, stating in some civil cases the standard is higher than preponderance of evidence, and becomes “clear and convincing evidence,” where fraud or exact punitive damages are attempting to be proved, but the standard is not at “beyond a reasonable doubt.” Beyond a reasonable doubt leaves no person, who has heard all the evidence and evaluated it, with the ability to seriously doubt whether an individual has committed the crime. Then there is the issue of criminal forfeiture, which is a hybrid of a civil and criminal case, he stated.

Senator James remarked the government has decided that it cannot imprison the body of the person who is the target of the prosecution, until it has gone through the criminal trial. Therefore, it has resulted in the proceeding of inanimate objects or money, without having to go through the criminal proceedings or offer proof that rises to the level of beyond a reasonable doubt. Essentially the government is proceeding against property that is the instrumentality of the crime, or the fruits of the crime, explained Senator James

Senator James contended that it is in these instances that it has been allowed to be a civil case. Crime may not have been proven while no one has been convicted beyond a reasonable doubt, but the property aspect of the case, the civil aspect, can proceed and be completed. Then the government can take possession of the fruits of the crime, and own them and do as it pleases. However, he stated, this is possible even in the event that a crime is not proven and the individual is not convicted of the crime. This is the point where the possibility for injustice can enter.

Senator James commented that a number of proposals to reform have been suggested, but seem to be targeted at specific law enforcement agencies. He believes that the appropriate reform would be to take a look at the constitutional issue, aiming the reform at the level of proof that must be shown before the taking of property occurs, when a crime has only been charged and not proven. The proposed bill would, therefore, change the preponderance standard to one of a clear and convincing evidence standard. Senator James recalled his prior comments that this change would affect innocent individuals, because at the charge of the crime they are innocent until proven guilty beyond a reasonable doubt.

Continuing, Senator James remarked that the proposal leads to a higher standard. He contended that the higher standard is necessary because of the inextricable nexus between the civil case and the ultimate case against the individual.

Senator James invited other comments or questions from the committee. Senator Care stated, concerning S.B. 36, that 95 percent of the law he practices is civil litigation. Senator Care gave the example of the infamous Racketeer Influenced Corrupt Organizations Act (RICO), which has taken on a “life never intended.” When Senator Care consulted documentation on forfeiture, he believed that possibly the same thing could happen.

Senator Care stated he agrees with Senator James’ sentiments. He directed his comments to the testifiers, asking them not to assume that the committee as a whole knows anything about the issues under S.B. 36.

Senator Porter also had introductory remarks on S.B. 36, which he wanted to share with the committee. He stated that section 1, lines 11, 12, and 13 of S.B. 36, were the “meat of the change,” and asked Senator James to clarify the difference between preponderance of evidence and clear and convincing in the context of taking an individual’s property.

Senator James contended that particular statute did not have to do with proof of the guilt of the person, but with the fact that the property is the instrumentality or the fruit of the crime. Senator James gave an example. “If I am the plaintiff in a case, then I can explain to the jury with great creditability and case law on my side.” He stated that proof by preponderance of the evidence means that the evidence weights the scales of justice, and if the scales tip slightly one way, then the side to which the scale tipped has a preponderance of the evidence.

Senator James continued his explanation to Senator Porter. He explained that beyond a reasonable doubt leaves no reasonable person to harbor a serious doubt about whether or not the crime was committed and the person who committed it. Clear and convincing evidence falls between preponderance of the evidence and beyond a reasonable doubt. Senator James explained that clear and convincing evidence is not the slight tipping of the scales, as is preponderance of evidence, but gives the strong conviction that the property was the instrumentality of a crime.

Senator Porter consulted with the Chairman as to whether they were going to look at the seizure process for property or just at the preponderance of evidence. Senator James replied that the committee would be looking at the seizure process. Senator Porter wanted to clarify that the property could be held even in the cases where the individual had not been found guilty. Senator James agreed, stating that there would not be any changes in the ability of the state to have pre-conviction or pre-judgment forfeiture, but the change would again be the standard of care and holding the government to a higher standard of proof.

James J. Jackson, Lobbyist, Attorney, Nevada Attorneys for Criminal Justice, stated that the changes proposed were not going to be great, and that the remarks made by Senator James on the standard of proof being placed somewhere between beyond a reasonable doubt and preponderance of evidence is clear and correct. Mr. Jackson deferred his testimony to John Morrow and Bruce Judd.

John C. Morrow, Lobbyist, Washoe County Public Defender, stated the federal forfeiture standard has gone through major modifications, and is the basis for the current legislation. Mr. Morrow said he supports a more stringent standard because of the many “horror stories” that he is aware of at the federal level. Mr. Morrow deferred to Mr. Judd who does have some practice in the federal system.

Bruce Judd, Attorney, Las Vegas, testifying via videoconference, contended that he practices in the civil forfeiture area of both the federal and state courts; however, most recently the practice has been in the state courts. Mr. Judd said he believes that the standard that could be adopted would be that which many states have already adopted. The standard is that forfeiture occurs upon conviction. It is believed that S.B. 36, with its increased standard of care, is more appropriate than the preponderance of evidence standard that is currently in place, stated Mr. Judd.

Mr. Judd stated he believes that it should be more difficult for the government and law enforcement to take a citizen’s property based on alleged criminal conduct than it currently was. The law in its present form invites unwarranted seizures. Mr. Judd presented the committee with examples that arose from seizures from “airport cases.” Mr. Judd represented claimants in the civil forfeiture proceedings, and the clients included African Americans and Hispanics. The situation arose as the claimants visited Las Vegas with large sums of money. “Law enforcement did not like the way they looked,” explained Mr. Judd. Law enforcement approached them, interrogated them, and seized their cash.

Because of the preponderance of evidence level of proof, and because the claimants were visitors from outside of Las Vegas, Mr. Judd averred, and since there is no provision for an award of attorney’s fees in the event that the claimants prevailed, the law has built-in leverage for the state to exact as part of a settlement. The claimants did not have drugs or contraband of any kind, and were never arrested, nor were they ever charged with any crime, yet the nature of the particular civil forfeiture law permitted law enforcement to take a bounty. Mr. Judd believes that his clients fit a profile, and therefore were subjected to such injustices.

Mr. Judd stated he believes that the clear and convincing evidence standard along with the proposed provision of an award of attorney’s fees would cause some hesitancy in law enforcement to take a person’s property merely because of the way they look, and the provisions of S.B. 36 would curb the unwarranted seizure. Mr. Judd continued that while a more stringent standard would be appropriate, the measure that Chairman James introduced was supported and approved.

Senator Care questioned Mr. Judd about the other states that require forfeiture upon conviction, and also questioned the standard of proof of those other states. Mr. Judd answered that he did not have a sense of the majority of the states, but had information on codes from California to the East Coast. He continued that more than two of the states provide at least a reasonable doubt standard, and many provide a conviction standard for forfeiture seizure. For example, California under the health and safety code provides a condition of conviction. Mr. Judd stated that many of the other states provide different standards for particular areas of criminal law, such as controlled substance.

Senator James consulted back to the described case at the airport. It was stated that there was never a conviction obtained, nor was there a charge made, Senator James asked for more detail. Mr. Judd referred back to the case, stating again that each claimant fit a “racial profile.” The law enforcement did not “like the way they looked.” And there was a positive sniff from a drug dog, although no drugs were found, Mr. Judd stated. From the conclusions of the officers they seized the property. The case went to summary judgment motion before a district judge, and the judge noted “people visit Las Vegas with cash.”

The next case Mr. Judd referred to in his earlier testimony was similar to the first one described. The case involved an African American individual who fit a particular profile. He was stopped and interrogated, law enforcement found him to be suspect. Ultimately, the man was never charged with criminal activity. Mr. Judd stated that these circumstances are not unusual, especially at the airport.

In both cases Mr. Judd described neither individual was ever charged nor convicted with any crime, yet their property was seized and was never returned. Mr. Judd said he believes that both of the instances related to a particular profiling.

Senator Care asked to be further educated in the case of summary judgment. He stated that somewhere in the “moving papers” there had to be an idea of exactly why the cash was subject to forfeiture. Senator Care explained that he understood in the area of drug trafficking that an airplane could be seized as forfeiture, or in a case of growing marijuana, the field could be seized; however, in the instance of carrying cash, what was the wrongdoing? Did the cash refer to a drug transaction that took place two years ago, or the recent sale of proceeds from another criminal activity? Senator Care pondered on what the law enforcement agents were attempting to demonstrate through preponderance of the evidence.

Mr. Judd replied that at the time of the seizure, there was not an allegation that it was a particular crime of any sort. What led to the seizure was the destination. He explained there are drug profiles that airport personnel use, and they look to see where an individual is going. Also, if a person looks “over their shoulder” with a description called “furtive movement,” they meet the profile. Because of these profiles, law enforcement is able to find preponderance of evidence to seize the property of an individual, commented Mr. Judd.

Mr. Judd explained that once the property is seized, a civil forfeiture action is filed, and then all that must be shown by preponderance of evidence is probable cause. The problem mounting is where there is a low threshold of evidence to prove a lower threshold of circumstances existing at the time of the seizure. The cases that Mr. Judd referred to had no allegations, and nothing to the effect that the individual had taken in wrongdoing.

Senator Care followed by asking if the way the law is currently written, by the standard of preponderance of evidence, means that the court could find that it was more likely than not given the circumstances that “he must have done something.” Mr. Judd responded that for civil forfeiture the court looks at what the circumstances were at the time of the seizure, and the court also looks to determine if there was probable cause to support the seizure. Mr. Judd explained that currently the statute is written without any reference to a conviction of crime, showing it is more likely than not that an individual was involved in a crime of which the proceeds were the fruit.

One additional problem that Mr. Judd referred to, not knowing if it would be settled by the more stringent standard of proof, was that the government faces no real disadvantage in filing a civil forfeiture action. He commented the government does not face the idea that they may have to pay the attorney’s fees for the claimant, if successful.

Mr. Jackson responded to the comment of Mr. Judd, saying that beyond the forfeiture of cash cases, there are also instances that involve cars, homes, or other property. Mr. Jackson asked for the indulgence of the Chairman to bring more specific documentation of the instances brought forward. Senator James recalled he had read of a case, which was in the context of the federal changes, asking if Mr. Jackson knew of the specifics and that this information would be useful to the committee, as well.

Senator James continued his comments that it was not the intention of the bill to vilify the law enforcement or prosecutorial authorities that utilize the current statute. Rather, the intention was to raise the standard of proof, so the cases where the facts are not so compelling on the governments behalf, there was not an injustice done. Senator James referred to the provision, in the U.S. Constitution, for life, liberty, and property and due process of law must be followed to remove one of these properties. What due process is appropriate has been left to the government to decide, and he commented that looking at the statistics that have been provided, Nevada is on the low end of the level of due process.

Mr. Jackson assured the committee that the intention today was to uphold the constitutional rights of individuals, and place the burden on the government to show the nexus between the property and the crime committed.

William T. Walters, Chairman and Chief Executive Officer, Walters Group, stated that he wanted to share his own personal story of forfeiture seizure. Mr. Walters began his testimony referring back to December 7, 1996. On this date, the metropolitan police department in Clark County raided a facility that was in Mr. Walters’ name. The facility held people, present on the behalf of Mr. Walters, who were betting on sports events, he commented.

Mr. Walters continued his story, stating the police raided the facility on the pretense that the people were engaged in an unlawful bookmaking operation. When the raid was conducted records were seized and workers were interviewed. At the time of the raid, Mr. Walters said he had “$200,800,050 in deposits on hotels [and] phone sport-betting accounts in Las Vegas in a safety deposit box at the Horseshoe Hotel [Binion’s Horseshoe Hotel and Casino].” The reason the cash was in deposit at the hotel was that it is typical to bet on sporting events with cash or chips, he said.

When the raid and seizure took place, Mr. Walters stated, he did not feel alarmed because he knew he was not engaged in illegal activity. Mr. Walters said he believed that at the conclusion of the investigation his property (the cash) would be returned. Unfortunately, once the money was seized, the focus of the investigation was not on if he was an illegal bookmaker. The attorney whom Mr. Walters retained to represent him was approached with an offer to provide the retaining party $500,000. Mr. Walters testified that the $500,000 would allow the “problem to go away.”

Mr. Walters stated his attorney noted that the Las Vegas Metropolitan Police Department Intelligence Unit had a “slush fund.” Mr. Walters then retained his own investigators to provide him with more information on the situation. The information that he acquired through his investigators concluded that the money seized in such situations is put into a fund. This fund provides investigators the ability to travel, pay for department expenses, and miscellaneous uses. Mr. Walters stated that his belief is that there is zero accountability of where the money ends up. Mr. Walters said he only knew of this problem happening within Las Vegas, and specifically, the Las Vegas Metropolitan Police Department Intelligence Unit.

Mr. Walters said he believed that the “root of the issue” is the accountability of the money that is placed into the fund. Those law enforcement agencies that obtain property from seizure claim that the money is then used to fight crime. However, Mr. Walters said he does not believe that there is accountability for the travel or the portion of the fund which supposedly fights crime.

Mr. Walters also said he believed he was raided under the pretense that he had violated the law. He stated that because of the money that was seized from him he has been indicted three times, and two different judges have thrown the cases out. He continued to explain that the charges have embarrassed his family and himself, cost over $1 million in legal fees, and tainted his business reputation. Also, he said he believed that he would be indicted again. Mr. Walters stated his testimony was for the sole purpose of making sure these same problems do not happen to others.

Senator Care questioned Mr. Walters on the pending status of his case. Mr. Walters responded that the case has been ongoing since 1996, he has been indicted three times, and the money is still confiscated. Senator James inquired who the prosecutorial authority was in the case. Mr. Walters replied the prosecuting attorney was David Thompson, from the Attorney General’s office, Las Vegas.

Mr. Walters stated that unless there is accountability of where the money that is seized goes, the problem will continue. Senator James remarked that there are different ways to solve the problem. He said one way would be to make the time of which forfeiture applies coexistent with when a conviction is attained. Another way to solve the problem would be to try to divert forfeiture money to the General Fund of the state, stated Senator James.

Senator James continued that he had been researching the problem since his initial request of the bill, and the same debate is taking place in Kansas. In a number of states that have made the same proposed amendments, at least eight states have constitutional provisions, which provide for money and property forfeited under the statute to go to the state general fund or education. However, as Senator James read from the research out of Kansas, “little or no drug money seems to get there, police in North Carolina get around the provision by handing the seizures to federal agencies which return up to 80 percent of the money to the police.”

Senator James said he has found in his research that where the law enforcement agency has no interest in the funds it takes away the incentive, so this is one of the problems. Another problem is the money winding up in the federal government. Senator James initiated provisions into the current statute that change the standard of proof, which hopefully would avoid some of the problems found in Nevada and elsewhere.

Senator James read into testimony research conducted by the Legislative Counsel Bureau. The research concluded that 44 states authorize the use of proceeds for law enforcement purposes, and 22 of the states require or permit funding of drug enforcement activities. Also, 31 states establish a special fund for all or part of the proceeds, designated for law enforcement with various administrators. Seventeen states provide for drug education and treatment services, and three states allocate for local crime victim compensation, citizen reward, and neighborhood programs. Two states use the sale from real property for prison construction, yet six states disperse all proceeds for non-law enforcement activities.

Senator James concluded that he did not see a consensus of the states, but did see a “building consensus” from the federal government to the states in the standard of proof. Mr. Walters asked to go on the record in response to Senator James’ research, “I would like to see the money marked for law enforcement. It is a great place for the money to go to, and for the accountability of it.”

The Chairman stated the meeting would convene immediately upon adjournment of the Senate Floor Session, until then the Senate Committee on Judiciary is at recess, at 10:50 a.m.

Chairman James reconvened the Senate Judiciary meeting at 12:10 p.m., continuing the testimony on S.B. 36. Janine Hansen, Lobbyist, Nevada Eagle Forum, began her testimony on S.B. 36, stating her belief that the proposed provisions are a good step in the direction towards reestablishing constitutional rights. Ms. Hansen testified that she sees where the current statutes have bred disrespect for the law and for law enforcement. She continued that there is also disrespect among “many people who believe that drugs are wrong, and should have laws against drugs.”

Ms. Hansen contended that these same individuals who are concerned about the drug laws, are so concerned about the forfeiture laws that they feel that there might even be a need to decriminalize drugs. She furthered her concern that there are no limits and controls of forfeiture.

Ms. Hansen presented testimony on the “Civil Asset Forfeiture Reform Act of 2000, House of Representatives, United States Congress, April 11 2000,” (Exhibit G. Original is on file in the Research Library.). The problems of abuse concerning civil forfeiture were repeatedly discussed. Ms. Hansen stated the consensus out of the U.S. House of Representatives was that there was need to bring the balance back to where it was previously, when people had due process. She also said that the issue of racial profiling where people were targeted for forfeiture was mentioned in the congressional hearings.

Ms. Hansen said she believes that the current statutes do provide for action against those criminals who are unlawfully disregarding the law, but the statutes have crossed over into violating the constitutional rights of law-abiding citizens. In speaking of the bill, Ms. Hansen commented that United States Representative Sheila Jackson-Lee said, “this bill, the federal bill, would shift the burden of proof to the government, to prove by clear and convincing evidence when seizing property.” There is a move not only in the states, but also at the federal level, she stated. Federally, the justice department’s asset forfeiture budget increased from $27 million to $338 million since 1985, referenced Ms. Hansen.

Chairman James called forth those wishing to testify in opposition of S.B. 36.

Ben Graham began his testimony, stating the vast majority of states have the same standard that Nevada currently holds in its statute. If the committee decides to reform the standard of proof, which is a policy decision, it will make those engaging in “ill-gotten gain” less burdened to get their property back, stated Mr. Graham.

Senator James said he disagreed with the assumption that the provisions will make it easier for the “ill-gotten gain.” The provisions would make it more difficult to provide a higher standard in proving that the property at stake is the instrumentality of the crime. It is not the government’s responsibility to show that it is “ill-gotten gain,” commented Senator James.

Mr. Graham responded that under the constitutional safeguards proposed, every other civil action is under a preponderance of evidence. Senator James stressed the plaintiff [the government] is moving against the property, and therefore the burden of proof lay with the government. It is not addressing the right of someone whose property is already proven to be “ill-gotten gains” to make it easier to be returned, stated Senator James. He continued by saying, “The property at stake is innocent until proven guilty by preponderance of evidence or clear and convincing evidence. Just as the person is innocent until proven guilty, as is the property.”

Senator James remarked that he was willing to hear any testimony as to why a standard of preponderance should continue to be embraced. Continuing, the Chairman recalled a statement made by Mr. Graham where he said that these cases “were like any other civil cases.” Senator James disagreed “when the predicate for it is somewhere out there, there was a crime committed and this is the fruits of it.”

Mr. Graham responded that to prove guilt beyond a reasonable doubt was a much higher burden than other standards, and there might be instances when that was the case but could not be proved while, on the other hand, assets have been obtained that most likely are the instruments of a crime. Mr. Graham stated he believed currently the ability to prove the property is an aspect of a crime by preponderance of evidence should allow the proceeds to go to the government efforts. However, as stated by Chairman James, the provisions are not requiring the government to prove a crime has been committed, only to give more proof than was currently sought.

Mr. Graham recalled the District Attorney’s office looked beyond preponderance of the evidence, and the particular unit that dealt with such issues was under the supervision of Mr. Graham. He also stated that in the individual cases, testified about previously, he would like to show the facts that he holds, and suggested many times cases are slanted.

Chairman James interrupted Mr. Graham’s testimony and stated that it is not the objective of himself or the committee to vilify any particular agency, but to deal with the fundamental issue of interest and due process of property.

Senator Porter stated that he believed the issues of accountability and misuse of funds were germane to the discussion, and warranted an additional hearing. Also important were those innocent parties not receiving restitution against an agency, Senator Porter said. Mr. Graham said he refuted the allegations of “slush funds” and innocent people being “ripped off,” and said he welcomed a case-by-case scenario providing the facts.

Senator Porter questioned Mr. Graham, asking if innocent individuals were provided full restitution if they had lost assets. Mr. Graham stated that he “cannot say that categorically that it does not happen,” and said he was unaware of any specific case.

Senator Porter further questioned if there was currently a fund where the assets were retained, and a process for accountability for those assets. Mr. Graham replied that within his particular unit the funds were budgeted for attorneys, secretaries, and investigators. The county also picked up additional funding for process servers to make sure that individuals are aware of potential forfeiture actions. Moreover, all funds were allocated in the budget, stated Mr. Graham.

Senator James inquired as to the requirements of Nevada Revised Statutes (NRS) 179.119 for accounting for funds. The testimony heard earlier from Mr. Walters was accurate according to the statute, because the statute does state that the money confiscated is not part of the agency’s budget, stated Senator James. The fund is a statutory fund, but it is separate from the agency budget.

Senator Care commented that the problem was that there is an impression that people who are charged with a crime, but not convicted, can lose certain amounts of their property. Senator Care noted that there was no case law on the issue, and inquired if there was record of how many forfeitures have taken place under the current statute. Another question posed by Senator Care was what effect the proposed legislation would have on the District Attorney’s office and to the citizens of the state. Mr. Graham responded to the consequences of the legislation that very few cases go to trial. The only time when an individual surfaces to confront the matter was in a case where a large sum of money was involved, as in the case of Mr. Walters. From a practical standpoint, the legislation would have some effect because it would raise the bar on retaining forfeited assets, commented Mr. Graham.

Senator Care asked if, because of the focus of the legislation, there would be an impact on the “fight against crimes.” Mr. Graham replied that the monetary significance would not be great because the amount of forfeited assets varied from year to year. The impact would depend upon the amount of criminal activity throughout the year, as well as the amount of forfeited money. Mr. Graham concluded that there probably would not be a great impact.

Senator Porter referred to NRS 179.119, “revenue from forfeitures must not be considered in the preparation or adoption of the budget of a law enforcement agency except as money to match money from the Federal Government.” Senator Porter questioned Mr. Graham on previous testimony where Mr. Graham stated that the funds were not directly part of the agency’s budget. Mr. Graham replied that he had not spoken directly of the budget, and referred to Captain Nadeau and Lieutenant Olsen.

Senator James pointed out that statutorily the adoptions of forfeiture were originally from 1987. Referring to the language of section 119 of Chapter 179 of NRS, Senator James commented, “Here at the Legislature, we say it must not be included in the budget.” He continued, stating that all of the money and property has to be in an off-budget account of the agency. However, in certain circumstances, there may be reasons why the money should be in the agency’s budget because of inchoate or property subjected to rights of redemption of the person accused. Senator James questioned why the current statute states that the money “must not” be included. He contended that the wording creates a separate fund.

Bernard B. Zadrowski, Deputy District Attorney, Clark County District Attorney’s Office, stated that he noted some of the issues which were brought up earlier in the meeting and that with regard to the federal standard, which brought up a number of abuses that were taking place in the system, these have now been addressed. Mr. Zadrowski commented that one of the abuses dealt with the fact that the defendant held the burden of proof that the funds were not forfeitable. He said that Nevada has never held the standard of burden to lay with the defendant.

Mr. Zadrowski said he found five states that have adopted the higher standard of proof: California, Connecticut, Florida, Kentucky, and New York. The vast majority of states have the same standard of proof as Nevada, contended Mr. Zadrowski.

Mr. Zadrowski commented on the testimony of the “airport cases,” stating he would provide information on what the District Attorney’s office will approve. Mr. Zadrowski stated that many of the cases that were brought to the District Attorney’s office were often rejected. There were a number of cases that had been addressed in the federal system which were utilized here in Nevada when deciding if it was appropriate to go forward in a case. However, it was not the case that funds would be taken based on racial profiling. Mr. Zadrowski offered to categorically state of the 200 complaints drafted, there was not a single case where racial profiling was an issue of forfeiture. The courts have made it clear that the profiles used in airport cases, “in and of themselves are not criminal conduct, but coupled with six or seven other factors does make money ripe to be forfeited under the standard of probable cause,” stated Mr. Zadrowski. Also, probable cause would be the same standard used by a police officer to make an arrest.

Senator Porter asked Mr. Zadrowski of the 200 complaints that had been filed within the last year, how many were found to not be legitimate. Mr. Zadrowski replied 5 percent, and said he had no knowledge, in the last 10 years, of one case going to trial. Senator Porter continued his questioning, asking whether, of the 5 percent, there were any innocent parties who had not received full restitution of their funds or property. Mr. Zadrowski stated he did not know of any, and as a matter of policy, the District Attorney’s office did not proceed on a forfeiture case where there is community property. He continued that property is not taken from an innocent party, or property that is an instrumentality where there is a spouse who lives in a house.

Senator James inquired how many of the 200 complaints included a criminal complaint as well. Mr. Zadrowski replied that it was between 70 and 80 percent of the cases. Those that did not get filed on significantly are the “airport cases,” he said, adding that the majority of cases that were filed on involved two areas of criminal activity, drug dealers and pimps. Mr. Zadrowski stated that the United States Supreme Court had set forth a list of criteria that must happen before the property can be taken under probable cause.

Senator James asked if the criminal profile is the predicate. By the information provided by Mr. Judd, Senator James said he was under the impression that there is an appearance and nature of an individual that results in a profile. Mr. Zadrowski gave an example of what amounts to probable cause: “a short trip to a major source city for drugs and a method payment for payment for plane tickets.” Another factor, “arriving at the ticket counter a short time before departure and paying cash for a one-way ticket, is consistent with the drug profile,” Mr. Zadrowski explained.

Senator James remarked that if all of the six or seven factors are present, then there should be “clear and convincing evidence” to present at a trial. Mr. Zadrowski replied that is an exception, “all of these factors amount to probable cause, not to clear and convincing evidence.”

Senator James asked of the “200, 70 to 80 percent cases filed, what percentage of those proceed to a judgment of conviction in a criminal case.” Mr. Zadrowski responded that, being a forfeiture deputy, he does not track what ultimately happens to the criminal case. However, he stated, he did know that every defense attorney had at their disposal the ability to take before the court the request to ask that the forfeiture case be stayed until the outcome of the criminal proceedings.

Senator James replied that he was unaware of this ability of the defense attorney, and questioned if this was a discretionary decision by the judge, and asked what standard the judge applies in making the decision. Mr. Zadrowski stated that he had never had one denied; therefore, he had never seen a defense attorney bring the motion to stay. Senator James continued his questioning, asking if individuals were entitled to a jury trial by right. Mr. Zadrowski answered that it was a constitutional right. Mr. Zadrowski commented that it was because of the “good balance” between law enforcement’s ability to carry out the actions they do and an innocent person’s ability to be free from the taking of their property, that there has not been any criminal proceedings within the last 10 years.

Mr. Graham followed the discussion by adding that the District Attorney’s office will provide all the records to the committee, as a stand from the prosecutorial aspect. Senator James pointed to a silent remark by Allison Combs, Policy Analyst, Research Division, Legislative Counsel Bureau, that the motion spoken of is in the non-amended provisions of the proposed statute. The Chairman noted, “While the motion is pending and it is stayed, where is the money or property?” Mr. Zadrowski addressed the concern stating that the money would stay in an account, but there were other asset items such as cars, boats, and other materials that would stay in an impound lot, where storage costs were accrued. The government paid the cost of storage, but there were usually negotiations of a percentage paid by the individual at case, Mr. Zadrowski confirmed.

Senator James asked if an individual could “stay the proceedings, but the property is still seized.” Mr. Zadrowski replied that the property was seized by probable cause, and the burden remained with the state. Once the case was taken into court, the burden was by a preponderance of evidence. Senator James responded that the holding of property was to keep it forever, and what was attempting to be changed.

Senator Care asked, “Mr. Zadrowski, your office drafts the complaints, and that [for] probable cause the money is taken, and no charges have been implemented?” He also asked Mr. Zadrowski if the complaint was drafted for the civil action, what entitled the office to draft the complaint if no charges had been made, and what burden was on the defendant to initiate action? Mr. Zadrowski replied that required by statute the District Attorney’s office must proceed once seizure has occurred by either denying the complaint or going forward. He stated there was a legal procedure by which the assets could be forfeited through a default judgment.

Senator Porter inquired into the 200 cases a year, stating statutes provide quarterly reports, and asked if there would be an estimate as to how much is seized per year in value. Mr. Zadrowski reported for the year 1999-2000, for cases closed, “meaning a stipulation through the claimant that they choose not to fight it, or the prosecution has won by default, these figures are internal.” He stated those closed, for example, in the year 2000, Clark County seized approximately $2.5 million in cash. Of that, approximately half a million went back to the claimant and Las Vegas Metropolitan Police Department kept approximately $2 million. For 1999, the numbers were significantly different, $1.6 million to Metro and half a million to the claimant, Mr. Zadrowski stated.

Senator Porter continued his inquiry, recalling Mr. Zadrowski’s previous testimony that many of the claimants would not fight the forfeiture. It was the understanding of Senator Porter that since the matter was quasi-civil, the claimants were not assigned counsel. Mr. Zadrowski replied that the understanding was correct, in fact, in the majority of criminal cases, the public defender’s office defended the claimant. The public defender’s office was statutorily prohibited from representing a claimant in a civil action because their job was to represent the claimant criminally. Senator Porter asked how many people were unable to consent. Mr. Zadrowski answered at least half, but was unsure.

Senator James questioned the percentage that proceeds to default judgment. Mr. Zadrowski responded he did not have the specific numbers, his earlier testimony recalled “a good number.” Senator James commented that he had noted that “a good number” proceed to default judgment, and in half the cases there was no counsel involved and the public defender was prohibited from representing the accused as a claimant in a civil forfeiture proceeding, and if the claimant wanted counsel they would not receive it unless they could afford it. Mr. Zadrowski contended a good number of people were representing themselves in propria persona.

Mr. Zadrowski asked the Chairman if he would be permitted to read a portion of his prepared statement. Chairman James permitted the statement. Mr. Zadrowski recalled Senator James’ earlier statement that the proposed provisions were not about the drug dealers or the pimps, but about innocent parties. However, from the perspective of Mr. Zadrowski, the effect of the bill would be to benefit drug dealers and pimps. Ultimately, with a drug dealer or pimp, if the case would go to trial, the bill would have a “chilling effect” on the negotiation process, he stated. Mr. Zadrowski also believed that with the higher standard of proof, the drug dealers and pimps would take their chances. The vast number of cases that the bill would affect was the drug dealer, pimps, and felons, Mr. Zadrowski averred.

Senator James remarked that if “someone is a drug dealer or a pimp they are going to be convicted as such, and their property will be taken,” and the property would be taken under any standard. Continuing, Senator James stated the argument could be made that if “someone is accused of being a drug dealer or pimp, they are not a drug dealer or pimp. They are an innocent person who is innocent until proven guilty in the criminal justice system and are not drug dealers and pimps.” If, in fact, they are proven to be drug dealers and pimps, then their property should be taken, stated Senator James.

Senator James remarked he wanted to help shape the debate away from spinning it in terms of the committee trying to help criminals. Those referred to as criminals [drug dealers and pimps] are not criminals, they are innocent people. Mr. Zadrowski contended that he would “never make the assumption that the committee is helping criminals.”

Senator James continued that he saw no problem in characterizing a convicted person by that which their conviction determines; however, he did object to the characterization before they had been convicted, because the characterization of an innocent individual “swallows up the Bill of Rights” and it would be permitted to testify to the Legislature or any other body and classify innocent individuals as criminals. Therefore, he remarked, the legislation would be directed as a presumption that these individuals are “bad people.”

Chairman James reiterated previous comment. “We are not dealing with any particular office, that they are abusing the law, and not attempting to vilify or trying to subject anyone to ridicule.” As Senator James remarked that he had been on the Judiciary Committee for five years, and worked with all the different agencies, he might come from a different position; however, he recognized the jobs of the different agencies and the difficultly of each of them.

Senator James commented that as a committee they were the first to “throw the book at those convicted of committed crimes, with some of the highest and strongest penalties for crime in Nevada.” However, he stated, it must be recognized that the criminal justice mandate in the committee was to deal with punishments post-conviction, but also to deal with criminal procedure, which was all about protecting the accused.

Senator Porter remarked on his previous comments, “anyone who testifies in front of the committee is going to subjected to tough questions.” The fact that the bill had become contentious was because the bill had not been addressed since 1987, said Senator Porter.

Chairman James called Captain James F. Nadeau, Lobbyist, Legislative Liaison, Washoe County Sheriff’s Office, and Lieutenant Stan Olsen, Lobbyist, Government Liaison, Las Vegas Metropolitan Police Department, forward to testify. Captain Nadeau stated that his level of proof was probable cause; and as to clear and convincing, it was not of issue. He continued that it was important to remember that the law enforcement acts to did the right thing. Therefore, the allegations spoken of needed to be addressed. Captain Nadeau, as a commander of a division for the sheriff’s office, said it was not uncommon that he received allegations from the community that must also be looked into.

Addressing the concerns of what happens to the money, Captain Nadeau stated that in 1998-1999, the Washoe County Sheriff’s department received $25,000 from the state forfeiture account. In the fiscal year of 1999-2000, the department received $28,700. Captain Nadeau contended that the majority of forfeitures came from the consolidated narcotics unit. The unit costs $2 million, so the return of the investment from a forfeiture view was not significant, in his opinion.

Senator James asked if the money referred to was the money that came back to the agency, which was not used in the budget of the drug enforcement agency. Captain Nadeau stated that it was strictly state forfeiture monies, which fell under chapter 179 of the NRS. Senator James asked if it was the total amount forfeited. Captain Nadeau stated that in 1999 there were a total of 41 cases prosecuted, and in the year 2000, there were 45 cases. Out of the total 41 forfeiture cases, $128,000 was forfeited. In the year 2000, out of the 45 forfeiture cases, a total of $156,361 was forfeited. He continued, saying the money was broken up according to the participation of the units that were within the unit, Washoe County and Reno Police Department had equal staffing and therefore received shares. Also, Captain Nadeau stated, the District Attorney’s office received a portion, as did the Sparks Police Department, equal to the amount of participation.

Captain Nadeau stated that the tracking of the funds was public money. It was money that had to be accounted for, and the accounts were audited. The funds were defined by statute under chapter 453 of NRS, and the money used was for training of narcotics dogs and hazardous materials.

Senator Porter asked Captain Nadeau, in regards to the forfeiture fund and NRS, law enforcement must file a quarterly report, “would it be possible to see the last quarterly report?” Captain Nadeau replied that it would be sent to the committee.

Lieutenant Olsen echoed the statements of Captain Nadeau. He stated that there was not anything remotely similar to what was referred to earlier as the “slush fund.” Lt. Olsen continued it was very specific as to how the money was handled once seized, and the statute that set these provisions was followed. Senator James injected that he had read the statute and realized that it was an off-budget account, as was required by statute. However, Senator James stated, the proposed provisions would not affect Lt. Olsen because the changes affected what happens after the seizure had taken place.

Senator Porter clarified to those testifying and those in the audience that “there are people here today that do not represent Mr. Walters, whom have also shared their concerns, not at all related to the Walters’ case”. He continued by saying, “I ask questions, do not assume that all the questions are coming from one testimony.”

Senator James called for further testimony on S.B. 36. Lin T. Ng, Deputy City Attorney, City of Henderson, requested to go on record to agree with the comments of Mr. Graham and Mr. Zadrowski. Also, she stated that it was her opinion that the current statute was sufficient. Ms. Ng said she believed that it provided the tools needed to separate from the criminals from their ill-gotten gains, and their instrumentality from their criminal activity. The current statute also sufficiently provided safeguards to protect innocent claimants.

Ms. Ng referred to the testimony of the committee previously, usually where there was a criminal action proceeding, there was possibly a stay of the civil forfeiture proceedings, which was usually the procedure. Ms. Ng continued that the committee should be aware that the Nevada statutes provided for an innocent-owner defense, which was different than the federal system. Ms. Ng said she believed that the lack of the innocent-owner provisions in the federal system might be the cause of the abuses.

With regard to the issue once there was a criminal judgment in the case, the forfeiture of the assets would proceed simply and easily, this was not often the case, stated Ms. Ng. With the more sophisticated criminal, ownership could become a labyrinth. She stated it was not simply that the criminal was the owner of the property; the more sophisticated criminals put assets into the ownership of spouses or family members, therefore, the tracing of the assets was not a forgone conclusion.

Senator James questioned the innocent claim of defense, citing the reference was in NRS 179.1173, subsection 7, stating, “The property must be forfeited to the plaintiff, subject to the right of any claimant who establishes a protected interest.” Ms. Ng replied that it was NRS 179.1163 and NRS 179.11635, so if the assets or proceeds were in the title or ownership of another party, they could assert their innocence.

Senator James contended he would follow with some research on the innocent claim of defense. Also, he reiterated the broadness of the statute. There was a provision in the statute [NRS 179.1173, subsection 4] that stated, “In a proceeding for forfeiture, the rule of law that forfeitures are not favored does not apply,” commented Senator James.

Chairman James closed the hearing on S.B 36 and opened the hearing on Senate Bill 87.

SENATE BILL 87: Provides that court may order that psychological evaluation and necessary counseling be provided to child affected by battery which constitutes domestic violence. (BDR 15-854)

Senator Wiener appeared before the committee to seek support for S.B. 87. Senator Wiener testified on her written statement (Exhibit H), which explained the evolution of S.B. 87. Senator Wiener’s testimony defined an opportunity to help children who are subjected to a household of domestic violence. Senator Wiener also attached to her written testimony a list of proposed amendments to S.B. 87. She concluded her testimony, stating that she would be conducting research to provide further amendments to the bill, and would report back to the committee with her findings.

There being no further business, Chairman James adjourned the meeting at 1:35 p.m.

RESPECTFULLY SUBMITTED:

Heather Dion,

Committee Secretary

APPROVED BY:

Senator Mark A. James, Chairman

DATE: