Fuentes v. Shevin

Appellant
Margarita Fuentes
Appellee
Robert L. Shevin
Appellant's Claim
Denying debtors a hearing before merchandise is reposed by private creditorsviolates the Fourteenth Amendment's guarantee that no state shall deprive anyperson of property without due process of law.
Chief Lawyer for Appellant
Michael Abbott
Chief Lawyer for Appellee
Herbert T. Schwartz
Justices for the Court
William J. Brennan, Jr., William O. Douglas, Thurgood Marshall, Potter Stewart (writing for the Court)
Justices Dissenting
Harry A. Blackmun, Warren E. Burger, Byron R. White (Lewis F. Powell, Jr., and William H. Rehnquist did not participate)
Place
Washington, D.C.
Date of Decision
12 June 1972
Decision
The Court set aside two three-judge federal district court decisions that upheld the constitutionality of laws in Florida and Pennsylvania, which allowedprivate creditors to repossess merchandise under a writ of replevin, withoutproper notice or a hearing. Derived from common law, replevin allows for thereturn of specific merchandise that was taken improperly or wrongfully.
Significance
Fuentes v. Shevin established that even if debtors failed to make payments and had signed a contract agreeing to do so, they were, nonetheless, entitled to proper notice and a hearing before private creditors could repossessmerchandise or chattel.
Debtors' Rights and Contractual Agreements
Margarita Fuentes, a Florida resident, purchased a gas stove and service policy from Firestone Tire and Rubber Co. under a sales contract, which requiredmonthly payments over a specified period of time. Fuentes later purchased a stereophonic phonograph under a similar agreement. The stove and stereo cost $500. The contract entitled Fuentes to keep the merchandise, unless she failedto make the payments and Firestone kept the titles to the merchandise. Fuentes made the payments for more than a year, but with roughly $200 remaining onher bill a dispute developed over servicing of the stove. Firestone filed suit in small-claims court for repossession of both the stove and stereo. At that same time, even before Fuentes received a summons to answer the complaint,the company also got a writ of replevin ordering a sheriff to seize the stove and stereo immediately.
Under Florida law, Firestone, only had to fill out the proper forms and submit them to the clerk of the small claims court. The clerk approved the documents and issued a writ of replevin. That same day, a deputy sheriff accompaniedby a Firestone representative, went to Fuentes's home and repossessed the stove and stereo. Later, Fuentes filed suit in a federal district court under the grounds that the state's replevin procedures violated the Due Process Clause of the Fourteenth Amendment.
In a separate action in Pennsylvania, several people filed a similar claimedthat also challenged the constitutionality of that state's replevin process.Three of the claimants had purchased a bed, a table and other household goodsunder a sales contract similar to the one signed by Fuentes. The creditors filed writs of replevin, claiming that the debtors had failed to make their installment payments as required under the contracts. One of the appellants inthe Pennsylvania case was divorced from a local deputy sheriff and was in custody battle for their son. The ex-husband filed a writ of replevin that ordered seizure of the child's clothes, furniture and toys.
In both the Florida and Pennsylvania cases, a three-judge district court upheld the constitutionality of the states' statutes. The Florida law did not require the applicant to prove before the seizure that the claimant was entitledto the merchandise. Instead, one merely had to assert that he was entitled to the property and file a complaint. Just as the debtor received the complaint for repossession of the property, the property was repossessed. The merchandise was seized without any prior notice or opportunity to dispute the writ of replevin. After the property was repossessed, the debtor eventually had anopportunity for a hearing. In addition, the Florida statute required the lawenforcement officer, who seizes the property, to hold it for three days, during which the debtor could reclaim the merchandise by posting a security bondfor double the value of the merchandise. If the debtor failed to post the bond in that three-day period the property reverted back to the creditor or whoever filed the writ of replevin. The Pennsylvania statute, varied only slightly from the Florida law, but presented no opportunity for a hearing. In orderfor the debtor to receive a hearing, that individual must have filed a lawsuit.
In writing for the majority, Justice Stewart first addressed whether the statutes were "constitutionally defective" for not providing hearings at a "meaningful time." The Florida statute allowed for a hearing after the merchandisewas seized, but the Pennsylvania statute only allowed a hearing if the debtorinitiated a lawsuit. Neither required a hearing before the property was repossessed. Justice Stewart wrote:

The constitutional right to be heard is a basic aspect of the duty of government to follow a fair process of decision making when it acts to deprive a person of his possessions. The purpose of this requirement is not only to ensure abstract fair play to the individual. Its purpose, more particularly, is to protect his use and possession ofproperty from arbitrary encroachment--to minimize substantively unfair or mistaken deprivation of property, a danger that is especially great when the State seizes goods simply upon the application of and for the benefit of a private party. So viewed, the prohibition against the deprivation of property without due process of law reflects the high value, embedded in our constitutional and political history, that we place on a person's right to enjoy what ishis, free of governmental interference.

Having an opportunity to contest or dispute the repossession of property wasthe only way to prevent the process from being unfair, he reasoned. "The Fourteenth Amendment draws no bright lines around three-day, 10-day, or 50-day deprivations of property. Any significant taking of property by the State is within the purview of the Due Process Clause." Even if the debtors were still paying for the merchandise, they were still entitled to due process. In fact,Justice Stewart reasoned that even if the debtors failed to obey their contracts and defaulted on their payments that they were still entitled to a hearing before property in their possession was seized. "The right to be heard doesnot depend upon an advance showing that one will surely prevail at the hearing," he wrote.
The lower courts reasoned that the debtors were not entitled to due process protection because the materials seized did not merit it because they were not"absolute necessities of life." Justice Stewart believed that conclusion wasreached by reading Snaidich v. Family Finance Corp. (1969) and Goldberg v. Kelly (1970) too narrowly. In both those cases, the Court ruledthe Contitution requires a hearing before wages were garnished and before certain welfare benefits were terminated. "Both decisions were in the mainstreamof past cases, having little or noting to do with the absolute `necessities'of life but establishing that due process requires an opportunity for a hearing before deprivation of property takes effect," Justice Stewart wrote. He added: "It is not the business of a court adjudication of due process rights to make its own critical evaluation of those choices and protect only the onesthat, by its own lights, are `necessary.'"
The majority recognized that in some circumstances, such as meeting the needsof a war effort or to protect against the economic disaster or a bank failure warrant, delaying a hearing or proper notice was warranted. However, the replevin laws in Florida and Pennsylvania allowed

summary seizure of a person's possessions when no more than private gain is directly at stake.The replevin chattels, as in the present cases, may satisfy a debt or settlea score. But state intervention in a private dispute hardly compares to state action furthering a war effort or protecting the public health.

Finally, Justice Stewart addressed the contractual obligations of the debtors. He reasoned, that while the contracts stated the property could be reposedfor failure to make payments it made no mentioned of waiving a right to a prior hearing.

The appellees do not suggest that these provisions waived the appellants' right to a full post-seizure hearing to determine whetherthose events had, in fact, occurred and to consider any other available defenses. By the same token, the language of the purported waiver provisions didnot waive the appellants' constitutional right to a pre-seizure hearing of some kind.

In a dissenting opinion, Justice White argued that in light of Younger v.Harris, which was announced after the district court's ruling, those rulings should be vacated and the cases reconsidered. Younger v. Harris established that the federal courts would not supercede the state courts unlessthe case resulted from bad faith or harassment. Justice White also reasonedthat if the debtor has indeed defaulted on payments that the creditor shouldbe allowed to repossess the property. "Dollar-and-cents considerations weighheavily against false claims of default as well as against precipitate actionthat would allow no opportunity for mistakes to surface and be corrected." He further argued that creditors could maneuver around the majority's ruling by simply making it clear in the contractual language that they can repossessthe merchandise. He concluded: "None of this seems worth the candle to me. The procedure that the Court strikes down is not some barbaric hangover from bygone days. The respective rights of the parties secured transactions have undergone the most intensive analysis in recent years."
Impact
Fuentes v. Shevin followed several other cases that established due process for procedures where they had not been viewed as required under the DueProcess Clause of the U.S. Constitution. In Goldberg v. Kelly (1970)the Court ruled that before welfare benefits could be terminated that the recipient was entitled to a hearing. In Bell v. Burson (1971) the Court ruled that a driver could not lose his license unless a hearing was held. Yet,the most important aspect of Fuentes was in consumer rights because it afforded consumers protections and rights that were unavailable before.
Related Cases

• Snaidach v. Family Finance Corp, 395 U.S. 337 (1969).
  
• Goldberg v. Kelly, 397 U.S. 254 (1970).
  
• Bell v. Burson, 402 U.S. 535 (1971).
  
• Arnett v. Kennedy, 416 U.S. 134 (1974).
  
• Cleveland Board of Education v. Loudermill, 470 U.S. 532 (1985).

Writ of Replevin
Replevin, also known as clan and delivery, Detinue, Revindication, and Sequestration refers to legal action taken by the owner of some item (usually of personal value) in an effort to reclaim possession of an item that has been wrongfully taken. It is one of the oldest forms of legal action originating in the fourteenth century as a means of protecting tenants from landlords. Landlords used to take possession of personal valuables to compensate for past duerent--items which often exceeded the value of rent owed.
Replevin, most often referred to as claim and delivery, is considered a "possessory" action because the main objective of the suit is to regain possessionof a particular good, however, compensation beyond the repossessed item is often sought. Replevin can only be used to recover tangible personal propertywhich must be adequately described by the plaintiff, for example in the caseof a stolen family heirloom. Stock certificates and valuable intellectual property such as mathematical formulas can be recovered in replevin suites but not undocumented ideas.
Sources
Black, Henry Campbell. Black's Law Dictionary. St. Paul, MN: West Publishing Co, 1990.