1997 Minnesota Statutes

     296.165 Untaxed fuel; conveyances; seizure and 
  forfeiture. 

    Subdivision 1.    Seizure.  The commissioner or 
 authorized designees may seize gasoline or special fuel being 
 transported for delivery in violation of section 296.06, 
 subdivision 1, and any vehicle or other method of conveyance 
 used for transporting the gasoline or special fuel.  Any untaxed 
 motor vehicle fuel that is received by a person other than a 
 licensee is subject to seizure along with the vehicle or other 
 means of transportation used to transport the motor vehicle 
 fuel.  Any motor vehicle fuel, along with the transporting 
 vehicle, brought into Minnesota by a transporter for use, 
 distribution, storage, or sale that is not supported by a 
 manifest, bill of lading, or invoice, reflecting the licensed 
 distributor responsible for the tax and/or fees is subject to 
 seizure by the Minnesota department of revenue.  Property seized 
 under this subdivision is subject to forfeiture as provided in 
 subdivisions 2 and 3.  

    Subd. 2.    Motor fuel; inventory, judicial action, 
 forfeiture.  Within two days after the seizure of gasoline or 
 special fuel, the person making the seizure shall deliver an 
 inventory of the property seized to the person from whom the 
 seizure was made, if known, and file a copy with the office of 
 the commissioner.  Within ten days after the date of service of 
 the inventory, the person from whom the property was seized or 
 any person claiming an interest in the property may file with 
 the commissioner a demand for a judicial determination of 
 whether the property was lawfully subject to seizure and 
 forfeiture.  The commissioner, within 30 days of demand for a 
 judicial determination, shall begin an action in the district 
 court of the county where the seizure was made to determine the 
 issue of forfeiture.  The action must be brought in the name of 
 the state and prosecuted by the county attorney or by the 
 attorney general.  The court shall hear the action without a 
 jury and shall try and determine the issues of fact and law 
 involved.  When a judgment of forfeiture is entered, the 
 commissioner may, unless the judgment is stayed pending an 
 appeal, either (1) cause the forfeited property to be destroyed; 
 or (2) cause it to be sold at public auction as provided by 
 law.  Proceeds of a sale, after deducting the expense of keeping 
 the gasoline or special fuel and costs of the sale, must be paid 
 into the state treasury.  The commissioner shall reimburse 
 designees for costs incurred.  If a demand for judicial 
 determination is made and no action is commenced as provided in 
 this subdivision, the property must be released by the 
 commissioner and redelivered to the person entitled to it.  If 
 no demand is made, the property seized must be considered 
 forfeited to the state by operation of law and may be disposed 
 of by the commissioner as provided where there has been a 
 judgment of forfeiture.  When the commissioner is satisfied that 
 a person from whom property is seized under this chapter was 
 acting in good faith and without intent to evade the tax, the 
 commissioner shall release the property seized, without further 
 legal proceedings.  

    Subd. 3.    Conveyances; judicial action; forfeiture.  
 (a) The commissioner or authorized designees shall file with the 
 court a separate complaint against the vehicle or conveyance, 
 describing it and charging its use in the specified violation, 
 and specifying substantially the time and place of the unlawful 
 use.  A copy of the complaint must be served on the defendant or 
 person in charge of the vehicle or conveyance at the time of 
 seizure, if any.  The court shall issue an order directed to any 
 person known or believed to have a right or title to, interest 
 in, or lien on the vehicle or conveyance and to persons unknown 
 claiming a right, title, interest, or lien:  

    (1) describing the vehicle or conveyance and stating that 
 it was seized and that a complaint against it, charging the 
 specified violation, has been filed with the court; 

    (2) requiring the persons to file with the court 
 administrator of the court their answer to the complaint, 
 setting forth any claim they may have to a right or title to, 
 interest in, or lien on the vehicle or conveyance, within ten 
 days after the service of the order; and 

    (3) notifying them in substance that if they fail to file 
 their answer within that time the vehicle or conveyance will be 
 ordered sold by the commissioner.  

    (b) The court shall cause the order to be served on:  

    (1) the registered owner; 

    (2) any person who has duly filed a conditional sales 
 contract, mortgage, or other lien instrument covering the 
 property unless it has been released or satisfied; 

    (3) any other person known or believed to have a right, 
 title, interest in, or lien upon, the vehicle or conveyance as 
 in the case of a summons in a civil action; and 

    (4) on unknown persons by publication, as provided for 
 service of summons in a civil action.  

    (c) If no answer is filed within the time prescribed, the 
 court shall, on affidavit by the court administrator of the 
 court setting forth that fact, order the vehicle or conveyance 
 forfeited and direct that it be sold by the commissioner or the 
 commissioner's agents.  The proceeds of the sale, after 
 deducting the expense of keeping the vehicle or conveyance and 
 costs of the sale, including any costs incurred pursuant to 
 paragraph (f), must be paid into the state treasury.  The 
 commissioner shall reimburse designees for costs incurred.  

    (d) If an answer is filed within the time provided, the 
 court shall fix a time for hearing at least ten but no more than 
 30 days after the time for filing the answer expires.  At the 
 hearing, the matter must be heard and determined by the court, 
 without a jury, as in other civil actions.  If the court finds 
 that the vehicle or conveyance, or any part of it, was used in a 
 violation as specified in the complaint, it shall order the 
 vehicle or conveyance forfeited and direct that it be sold, as 
 provided in this section, unless the owner shows to the 
 satisfaction of the court that the vehicle was being used 
 without the owner's consent or that, when giving the consent, 
 the owner had no notice or knowledge or reason to believe that 
 the vehicle or conveyance was intended to be used in a 
 violation.  After deducting the expense of keeping the vehicle 
 or conveyance and costs of the sale, the officer making the sale 
 shall pay, according to their priority, all liens established at 
 the hearing as being bona fide and existing without the lienor 
 having any notice or knowledge at the time the lien was created 
 that the vehicle or conveyance was being used or was intended to 
 be used in connection with any violation, and shall pay the 
 balance of the proceeds into the state treasury.  The 
 commissioner shall reimburse designees for costs incurred.  A 
 sale under this section frees the conveyance sold from all liens.

    (e) At any time after seizure and before the hearing, the 
 vehicle or conveyance must be returned to the owner or person 
 having a legal right to its possession on execution by that 
 person of a valid bond to the state of Minnesota, with corporate 
 surety, of at least $100 but not more than double the value of 
 the vehicle or conveyance seized, to be approved by the court in 
 which the case is triable, or a judge of that court.  The bond 
 must guarantee compliance with the order and judgment of the 
 court, and, if ordered by the court, payment of the full value 
 of the vehicle or conveyance at the time of seizure.  

    (f) If the seized vehicle or conveyance is owned or 
 operated by a for-hire common or contract motor carrier, and was 
 being used without knowledge of the violation, the commissioner 
 shall return the vehicle or conveyance to its owner or operator 
 as soon as possible without need for court order, and shall 
 provide to such owner or operator reasonable compensation for 
 the time during which the vehicle or conveyance is held pursuant 
 to seizure. 

    HIST: 1991 c 291 art 9 s 14; 1994 c 510 art 5 s 33