author: ZINTER, Justice.

text:
    2003 SD 111
    Lester L. DAVIS, Jr., Bankruptcy Examiner, In the Interest of the Bankruptcy Estate of Patrons Cooperative Association, Plaintiff and Appellee, v. FARMLAND MUTUAL INSURANCE COMPANY, Defendant and Appellant, and Robert Heidgerken, Michael Yackley, Darrel Bishop, Kenneth Singpiel, Laverne Koch, Edward McMahon, Ronald Johnson, Joe Varilek, and Cathy Everett, Defendants.
    Nos. 22726, 22729.
    Supreme Court of South Dakota.
    Considered on Briefs Aug. 25, 2003.
    Decided Sept. 10, 2003.

      Michael J. Whalen, Rapid City, SD and Brad A. Schreiber of Day, Morris & Schreiber, L.L.P., Belle Fourche, SD, for plaintiff and appellee.
    John Stanton Dorsey of Whiting, Hagg and Hagg, L.L.P., Rapid City, SD, for appellant Farmland Mutual.
   ZINTER, Justice.

[¶ 1.] In 1999, Patrons Cooperative Association filed for Chapter 11 bankruptcy protection. The bankruptcy court appointed Lester Davis, Jr. as a bankruptcy examiner. Davis investigated Patrons’ prior business activities and commenced legal proceedings against Patrons’ directors and managers for damages arising from their operation of the business. Davis also commenced this declaratory judgment action against Farmland Mutual Insurance Company to determine whether Patrons’ Directors, Officers and Managers Liability Insurance Policy (DOM policy) afforded coverage for the directors and managers. The trial court granted partial summary judgment. It concluded that the “insured vs. insured” and “dishonest acts” exclusions did not preclude coverage for the directors. However, the trial court found that there were genuine issues of material fact relating to the managers’ conduct under the “dishonest acts” exclusion. Therefore, the trial court denied summary judgment for the managers. An attempted appeal from that non-final decision was denied by this Court. The circuit court then certified its partial coverage determination as a final judgment pursuant to SDCL 15-6-54(b). Farmland now appeals again frQm the partial coverage determination. By notice of review, Davis appeals the Rule 54(b) certification. We reverse the Rule 54(b) certification, dismiss the appeal, and remand for trial and final judgment on all coverage issues.

FACTS AND PROCEDURAL HISTORY

[¶2.] Patrons was a cooperative that operated in Rapid City. Prior to 1994, the business operated a bulk plant and a gas station known as the Main Stop. In the early to mid 1990’s, the bulk plant was upgraded at a cost of approximately $250,000, and the gas station was converted to a convenience store at a cost of over $200,000. General supervision and control of the cooperative was under the board of directors. The managers were responsible for the day-to-day affairs.

[¶ 3.] In 1994, Patrons was faced with decreasing membership and increasing fuel costs. Consequently, Patrons decided to significantly expand its operation by building a new store in Rapid City. Notwithstanding certain risks, Patrons purchased 12.2 acres of land without conducting a feasibility study to determine whether the proposed store could operate at a profit. Patrons paid $270,000 for the land even though the company only needed two acres for the proposed store and car wash. The realtor who sold the 12.2 acres represented that the parcel could be split into lots and sold; however, it was later discovered that the land could not be subdivided. Consequently, the cooperative owned 10.2 acres more than it needed.

[¶4.] After the land was purchased, feasibility studies indicated that it would take up to three years to start making a profit. However, the feasibility studies were allegedly flawed because of errors and erroneous factual assumptions. Some of the alleged errors and flawed assumptions were: 1) the car wash, which cost $150,000, was not included in the study; 2) the project was originally estimated to cost between $790,000 and $850,000, but actually cost $1.1 million; 3) the studies assumed a fifteen-year loan at nine percent interest, but the project was financed with a seven-year loan at ten percent interest; and 4) actual operating expenses were nearly two times greater than those projected.

[¶ 5,] Patrons subsequently filed a Chapter 11 bankruptcy, and the bankruptcy court ordered the United States Trustee to appoint a disinterested person to serve as a bankruptcy examiner. The trustee appointed Davis. Davis investigated the former directors and managers for allegations of fraud, dishonesty, incompetence, misconduct, mismanagement or irregularity. Based on his findings, the bankruptcy court granted Davis’s motion to commence an action against the former directors and managers. The action alleged wrongful acts and breaches of fiduciary duty. Davis claimed losses by the equity security holders of not less than $1.2 million; losses by creditors as a result of the fifing of the Chapter 11 bankruptcy; and, losses incurred by the bankruptcy estate.

[¶ 6.] Davis also commenced this declaratory judgment action to determine whether Patrons’ DOM policy afforded coverage for the acts and omissions of the directors and managers. The allegations against the directors included:

1. Failure to use due care, judgment and diligence in the preservation of cooperative assets;
2. Failure to act on an informed basis and in the best interests of the cooperative;
3. Failure to abide by the cooperative bylaws and comply with federal and state law;
4. Failure to make due inquiry of financial and personnel matters detrimentally affecting cooperative business;
5. Failure to avoid undue risks in business ventures and endeavors;
6. Failure to ascertain the relevant and available facts before voting on matters involving cooperative business;
7. Failure to monitor the financial condition of the cooperative;
8. Failure to devote reasonable time and attention to cooperative affairs;
9. Failure to exercise due skill and judgment in making business decisions for the cooperative; and
10. Failure to use due care in the supervision of the cooperative’s managers.

Davis’s allegations against the managers included:

1. Failure to provide necessary financial statements, reports, and information to the board of directors of Patrons;
2. Failure to keep true books and records;
3. Failure to file necessary government forms and documents;
4. Failure to provide accurate information for independent audits;
5. Failure to utilize accepted bookkeeping and accounting methods;
6. Failure to track member equity;
7. Failure to operate computerized accounting programs;
8. Failure to generate and maintain complete records;
9. Failure to provide promised employee benefits;
10. Failure to attend to cooperative accounts payable and receivable;
11. Failure to abide by cooperative bylaws and policies;
12. Failure to avoid inappropriate personal/sexual relationships in management;
13. Failure to timely prepare complete and correct financial statements for review by the board of directors;
14. Failure to obtain necessary bonds for employees; and
15. Misrepresentation of facts to the board of Patrons’ so as to impair proper management of the business and affairs of the cooperative.

[¶ 7.] Farmland moved for summary judgment in the declaratory judgment action arguing that two policy provisions excluded coverage for the directors and managers. Farmland first argued that the directors and managers acted with sufficient bad faith to preclude coverage under the “dishonest acts” exclusion. Farmland also argued that Davis was a representative of Patrons, and therefore coverage was precluded under the “insured vs. insured” exclusion.

[¶ 8.] The circuit court held that the “insured vs. insured” exclusion did not apply to Davis when acting in the separate legal capacity of a bankruptcy examiner. The court also held that the actions of the directors did not rise to the level of bad faith, and therefore, coverage for the directors was not precluded by the “dishonest acts” exclusion. However, the court found that there were disputed questions of material fact whether the managers engaged in “dishonest acts.” Because those factual disputes existed, summary judgment was denied on the request for a coverage determination for the managers.

[¶ 9.] Farmland appealed the partial summary judgment on the coverage issues that the trial court did decide. We dismissed that appeal because it was not an appeal taken from a final judgment. See SDCL 15-26A-3, infra n. 1. Farmland subsequently requested that the trial court certify its partial coverage determination as a final judgment under SDCL 15 — 6— 54(b). The circuit court granted Farmland’s 54(b) motion, and Farmland now appeals again raising two issues.

1. Whether the “insured vs. insured” provision of the DOM policy excluded coverage.
2. Whether the “dishonest acts” provision of the DOM policy excluded coverage.

By notice of review, Davis appeals the trial court’s 54(b) certification questioning;

3.Whether the circuit court erred in certifying the partial coverage determination as a final judgment under SDCL 15-6-54(b).

Because we hold that the 54(b) certification should not have been granted, we need not address Issues 1 and 2.

DECISION

[¶ 10.] The jurisdictional issue raised in Davis’s notice of review requires us to determine if Farmland’s appeal is properly before this Court. SDCL 15-26A-3 limits our appellate jurisdiction. With the exception of discretionary intermediate appeals, that statute generally requires that the circuit court decision appealed must be a final order or judgment. However, SDCL 15-6-54(b) provides that a party seeking an appeal from an order that disposes of some, but not all claims or all parties may have that non-final decision certified as a “final judgment.”

When multiple claims for relief or multiple parties are involved in an action, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.

Id.

[¶ 11.] In reviewing a judgment entered pursuant to SDCL 15 — 6—54(b), we first determine whether the action involves multiple claims or multiple parties and thus falls within the purview of Rule 54(b). We then decide whether the trial court abused its discretion in making the determination that there was no just cause for delay in entering judgment with respect to one or more but fewer than all of the multiple claims. “This question is not always easy of resolution, for there is no hard and fast test that can be applied in a mechanical manner.” Ochs v. Northwestern Nat’l Life Ins. Co., 254 N.W.2d 163, 168 (S.D.1977).

[¶ 12.] In this case, it is clear that multiple parties exist. It is also clear that the trial court’s partial summary judgment decided the coverage issues relating to the directors, but left the managers’ “dishonest acts” coverage issue for trial. Therefore, our analysis is narrowed to the issue of “whether the trial court abused its discretion in making an express determination that there was no just reason for delay in entering final judgment.” Id.

[¶ 13.] A Rule 54(b) certification is not a procedural formality. It is “an essential prerequisite” that has “jurisdictional significance.” Id. Moreover, the certification is only permitted in the “infrequent, harsh ease.”

[T]he procedure contemplated by Rule 54(b) is usually more than a formality. Perhaps it can properly be viewed as mere formality, albeit an essential prerequisite of immediate appeal, in those cases where it is clear that the disposition of a portion of the litigation has been such as would clearly have constituted an appealable final judgment under [the rules in place] before the adoption of the Rules of Civil Procedure. But otherwise and ordinarily an application for a 54(b) order requires the trial judge to exercise considered discretion, weighing the overall policy against piecemeal appeals against whatever exigencies the case at hand may present. Indeed, the draftsmen of this Rule have made explicit their thought that it would serve only to authorize “the exercise of a discretionary power to afford a remedy in the infrequent harsh case....” It follows that 54(b) orders should not be entered routinely or as a courtesy or accommodation to counsel. The power which this Rule confers upon the trial judge should be used only ‘in the infrequent harsh case’ as an instrument for the improved administration of justice and the more satisfactory disposition of litigation in the light of the public policy indicated by statute and rule.

Id. at 168-69 (quoting Panichella v. Pennsylvania R.R. Co., 252 F.2d 452, 454 (3rdCir.1958)). Therefore, we have adopted three rules to guide the trial courts in exercising discretion on a 54(b) request.

(1) the burden is on the party seeking final certification to convince the [trial] court that the case is the ‘infrequent harsh case’ meriting a favorable exercise of discretion; (2) the [trial] court must balance the competing factors present in the case to determine if it is in the best interest of sound judicial administration and public policy to certify the judgment as final; (B) the [trial] court must mar-shall and articulate the factors upon which it relied in granting certification so that prompt and effective review can be facilitated.

Id. at 169 (further citations omitted). We have also identified some of the competing factors to be considered when deciding whether to grant 54(b) certification:

In reviewing 54(b) certifications, other courts have considered the following factors, inter alia: (1) the relationship between the adjudicated and unadjudicat-ed claims; (2) the possibility that the need for review might or might not be mooted by future developments in the [trial] court; (3) the possibility that the reviewing court might be obliged to consider the same issue a second time; (4) the presence or absence of a claim or counterclaim which could result in setoff against the judgment sought to be made final; (5) miscellaneous factors such as delay, economic and solvency considerations, shortening the time of trial, frivolity of competing claims, expense, and the like. Depending upon the facts of the particular case, all or some of the above factors may bear upon the propriety of the trial court’s discretion in certifying a judgment as final under Rule 54(b).

Id. (quoting Allis-Chalmers Corp. v. Philadelphia Elec. Co., 521 F.2d 360, 364 (3rdCir.1975)). In applying these factors, we reiterate: that appeals under RCP 54(b) will be considered appropriate in only the rare case, just as petitions for appeals from intermediate orders ... are granted only infrequently, and the trial court must include a “reasoned statement in support of its determination that ‘there is no just reason for delay’ and its express direction for ‘the entry of a final judgment as to one or more but fewer than all of the claims or parties’ where the justification for the certificate is not apparent.” Id. (further citations omitted). Mere recitation of the statutory language is insufficient. Id.

[¶ 14.] In the present case, the trial court reasoned:

Having reviewed the matter and having considered the arguments and briefs, the Court finds that the interests of judicial economy dictate that the questions of insurance coverage in this case be finally adjudicated which may be dispositive of the underlying action [the action for damages].... The Court finds that the interests of justice will be served, that there is no just cause for delay and good cause having been shown and pursuant to SDCL 15 — 6—54(b)....

(Emphasis added.)

[¶ 15.] We initially review this reasoning that a “final” adjudication of the insurance coverage “questions” ... “may” be dispositive of the underlying action and thereby serve the interests of judicial economy. In our view, these reasons do not support a 54(b) certification in this case. First, as previously noted, the trial court’s finding of disputed fact concerning the managers’ conduct under the “dishonest acts” exclusion will require a trial on that coverage question. Therefore, our review of this partial summary judgment will not “finally” adjudicate the coverage “questions” under the DOM policy. Second, while a final adjudication of all insurance coverage “questions” could dispose of the underlying action, we fail to see how deciding all but the managers “dishonest acts” coverage question would do so. That is especially the case where the claimed damages for the acts and omissions of the managers are essentially the same as the damages sought from the directors. Under these circumstances, it makes no difference whether the bankruptcy examiner’s recovery of insurance proceeds comes from directors acts/omissions or the managers acts/omissions. Consequently, appellate review of the directors’ coverage, without also deciding the managers’ coverage, would not seem likely to dispose of the underlying action. Indeed, we have been informed in appellate briefing that the underlying action for damages is proceeding despite this trial court’s request of another circuit judge to stay the damage action pending our decision in this appeal.

[¶ 16.] We also believe that the three relevant 54(b) factors fail to support certification. Factor one considers the relationship between the adjudicated and unadjudicated claims. Here the allegations against the managers are similar to the allegations against the directors. Consequently, the trial on the managers coverage issue will develop a more complete record for resolving both the managers and directors coverage. Additionally, any new facts revealed in the trial of the managers’ “dishonest acts” coverage question may be used to further inform the directors’ coverage issue. New facts may be considered because the trial court’s decision on directors’ coverage is not final; therefore, the trial court is free to revise its opinion should further fact development so dictate. SDCL 15-6-54(b).

[¶ 17.] We also consider that under factor three, if we were to affirm the partial summary judgment, there will still be a need for trial concerning the managers. Therefore, we may be asked to review the dishonest acts exclusion a second time. This also means that under factor five, delay, economic and solvency considerations, shortening the time of trial ... expense and the like weigh in favor of developing one complete factual record before appellate review. A complete factual record will not only assist in our initial appellate review, but a complete and final factual record will also resolve all coverage questions and thereby eliminate the substantial likelihood of further delay and expense of a second appeal to this Court before resolving the bankruptcy. Finally, a complete factual record will decrease the likelihood of inconsistent decisions on the coverage issue for the managers and the directors under the “dishonest acts” exclusion.

[¶ 18.] In the final analysis, we believe that the outstanding factual dispute concerning the managers’ “dishonest acts” should be resolved to more efficiently dispose of this declaratory judgment action and the bankruptcy. Unless this Court reverses the trial court on the “insured vs. insured” coverage question, Farmland’s liability will not be finally determined by this appeal. Because this Court’s decision on the partial summary judgment will not decide the managers’ coverage for “dishonest acts,” a trial and second appeal to this Court are likely. ' Moreover, that trial will be delayed until this appeal is decided. Finally, it appears that the underlying action for damages is proceeding despite this appeal. Under all of the circumstances, this piecemeal determination of the various issues is not in the interest of judicial economy. All factual issues relating to insurance coverage should be determined in one proceeding before appellate review. This is not the “rare” or “infrequently harsh case” justifying piecemeal review. Ochs, 254 N.W.2d at 168.

[¶ 19.] For these reasons, we reverse the 54(b) certification, dismiss this appeal and remand for trial.

[¶ 20.] GILBERTSON, Chief Justice, and SABERS, KONENKAMP, and MEIERHENRY, Justices, concur.

      . Although the record is not consistent, some officers may be included with the "directors,” as that later term is used in this action.

      . SDCL 15-26A-3 provides:
      Appeals to the Supreme Court from the circuit court may be taken as provided in this title from:
      (1) A judgment;
      (2) An order affecting a substantial right, made in any action, when such order in effect determines the action and prevents a judgment from which an appeal might be taken;
      (3) An order granting a new trial;
      (4) Any final order affecting a substantial right, made in special proceedings, or upon a summary application in an action after judgment;
      (5) An order which grants, refuses, continues, dissolves, or modifies any of the remedies of arrest and bail, claim and delivery, injunction, attachment, garnishment, receivership, or deposit in court;
      (6) Any other intermediate order made before trial, any appeal under this subdivision, however, being not a matter of right but of sound judicial discretion, and to be allowed by the Supreme Court in the manner provided by rules of such court only when the court considers that the ends of justice will be served by determination of the questions involved without awaiting the final determination of the action or proceeding; or
      (7) An order entered on a motion pursuant to § 15-6-11.

      . The only situation in which our review would be dispositive, is if we reversed the trial court on the "insured vs. insured” exclusion issue.


source: Caselaw Access Project

author: ANDERSON, LEE D., Circuit Judge.

license: Public Domain

text:
    2003 SD 110
    BANK OF AMERICA, N.A., Plaintiff, v. Murray V. DRIGGS, Karla A. Driggs, Western Bank, Culligan Water Conditioning, J & S Travel Associates, Inc., and Any Person in Possession, Defendants, and Dacotah Bank, Defendant and Appellee, and Lora Hubbel, Intervenor and Appellant.
    No. 22630.
    Supreme Court of South Dakota.
    Argued May 28, 2003.
    Decided Sept. 10, 2003.

      Frederick M. Entwistle of Woods, Fuller, Shultz & Smith, Sioux Falls, SD, Attorneys for appellee.
    John P. Mullen of Bangs, McCullen, Butler, Foye & Simmons, Sioux Falls, SD, Attorneys for appellant.
   ANDERSON, LEE D., Circuit Judge.

[¶ 1.] Lora Hubbel (Hubbel) appeals from an order in favor of Dacotah Bank (Dacotah Bank). Hubbel is the purchaser of a piece of real property sold at a sheriffs public auction following a foreclosure action by Bank of America. Dacotah Bank is a junior lienholder that attempted to redeem the property pursuant to the 180-day Redemption Mortgage Act (SDCL 21-49-1 et seq.) (Redemption Act). On appeal, Hubbel contends that Dacotah Bank’s actions to redeem from the foreclosure sale were insufficient. The trial court held that Dacotah Bank was in substantial compliance with the Redemption Act and directed the Minnehaha County sheriff to issue a sheriffs deed to Dacotah Bank. We affirm the trial court for the reasons set forth herein.

FACTS

[¶ 2.] Pursuant to a real estate mortgage foreclosure action commenced by Bank of America the Minnehaha County Sheriff sold a piece of real property located in Minnehaha County at public auction on December 26, 2001. The- property is legally described as:

Lot 20, in Block Six of Silver Valley, an Addition to the City of Sioux Falls, Minnehaha County, South Dakota, according to the recorded plat thereof.

[¶3.] Hubbel was the high bidder at the foreclosure auction and purchased the property for $83,000. Hubbel obtained a loan from First Premier Bank for which she incurred a loan origination fee of $480. The sheriff issued his sheriffs certificate of sale to Hubbel on December 28, 2001, and the certificate was recorded with the Minnehaha County Register of Deeds on December 31, 2001. Upon becoming the successful bidder, Hubbel obtained dwelling insurance on the property and paid two-months of property insurance premiums for $64.16 on December 28, 2001.

[¶ 4.] On January 3, 2002, Dacotah Bank delivered a notice of redemption together with a check for $83,127.36 to the sheriffs office pursuant to the 180-day Redemption Act. Dacotah Bank’s check represented the purchase price plus interest at the rate of 7 percent from the date of sale to the date of redemption. Hubbel was served with the notice of redemption by the sheriffs office on January 4, 2002, and the sheriff issued a certificate of redemption, dated January 3, 2002, which was recorded on January 7, 2002. Daco-tah Bank also recorded the notice of redemption on January 7, 2002. At the time of delivery of the check and notice of redemption, Dacotah Bank had no notice of Hubbel’s additional expense of insurance or of the loan origination fee.

[¶ 5.] On January 10, 2002, Hubbel recorded a document from her insurance company indicating that Hubbel had obtained a six-month insurance policy on the property and paid a two-month premium deposit. Hubbel did not send or deliver a copy of this document to either Dacotah Bank or its attorney.

[¶ 6.] Disputing the amount of the check, Hubbel informed the sheriff that the amount of the check was insufficient. Shortly thereafter, Hubbel spoke with Rick Entwistle, counsel for Dacotah Bank. Hubbel claimed that the amount of the check was insufficient because it did not cover her loan origination fee or the insurance payment she had made. Hubbel also discussed the loan origination fee and her insurance premium payment with Dave Bangasser, president of Dacotah Bank.

[¶ 7.] On February 15, 2002, Deputy Sheriff Ken Headrick, based on advice received from his state’s attorney, issued a letter to all of the parties involved and informed them that Hubbel had not cashed the check as of that date and that she disputed the amount of redemption.

[¶ 8.] On April 24, 2002, Hubbel paid the first half of the real estate taxes on the property in the amount of $1,118.27. Hub-bel also continued to pay the insurance premiums. As of June 28, 2002, the total premium paid was $192.48. Hubbel provided no notice of these additional expenditures to Dacotah Bank.

[¶ 9.] On Friday, June 28, 2002, attorney John Mullen, counsel for Hubbel, faxed a letter to Deputy Sheriff Headrick stating that Hubbel did not accept the validity of Dacotah Bank’s redemption and that the sheriffs deed should be issued to Hubbel rather than to Dacotah Bank.

[¶ 10.] On Monday, July 1, 2002, Ent-wistle faxed a supplemental notice of redemption to Mullen, which was also sent via mail to Mullen and Hubbel the same day. Additionally, Dacotah Bank delivered the supplemental notice of redemption to the sheriffs office on July 1, 2002, with an additional check for $66.38. This check represented the initial insurance premium paid by Hubbel along with interest in the amount of $2.22. The supplemental notice of redemption was recorded on July 1, 2002.

[¶ 11.] On August 13, 2002, Hubbel and Dacotah Bank filed a joint motion for issuance of sheriffs deed. A hearing was held that same day before Judge Severson with the parties filing a joint stipulation of facts. The court held that Dacotah Bank was in substantial compliance with the Redemption Act when Dacotah Bank gave its initial notice of redemption on January 3, 2002. Additionally, the trial court held that Dacotah Bank was in substantial compliance with the Redemption Act when Da-cotah Bank issued its supplemental notice of redemption on July 1, 2002. The trial court also held that SDCL 15-6-6(a) applied to this case to extend the 180 days from Saturday, June 29, 2002, until Monday, July 1, 2002. The court also granted Hubbel’s request for an order directing Dacotah Bank to reimburse her for amounts expended to protect her interest in the property, i.e., the additional funds she expended for insurance premiums and real estate taxes, but not for the loan origination fee.

STANDARD OF REVIEW

[¶ 12.] We review a trial court’s conclusions of law under the de novo standard, giving no deference to the trial court’s conclusions. Burkhart v. Lillehaug, 2003 SD 62, ¶ 9, 664 N.W.2d 41, 42. Likewise, construing a statute entails answering a question of law; thus, we review the circuit court’s statutory interpretation de novo. Esling v. Krambeck, 2003 SD 59, ¶ 6, 663 N.W.2d 671, 675.

[¶ 13.] We review a trial court’s findings of fact under a clearly erroneous standard. Clear error is shown only when, after a review of all the evidence, we are left with a definite and firm conviction that a mistake has been made. The trial court’s findings of fact are presumed correct and we defer to those findings unless the evidence clearly preponderates against them. Mathis Implement Co. v. Heath, 2003 SD 72, ¶ 9, 665 N.W.2d 90, 92.

ANALYSIS AND DISCUSSION

A. Compliance with the Redemption Act

[¶ 14.] Under the Redemption Act, Dacotah Bank, as the holder of a mortgage lien in the property junior to Bank of America (the plaintiff in the underlying mortgage foreclosure action) was entitled to redeem the property purchased by Hubbel at the sheriffs sale. SDCL 21-49-33. Any attempted redemption by Da-cotah Bank must meet the substantive requirements of the Redemption Act, specifically SDCL 21-49-34, which states:

Such persons may redeem from the purchaser by paying the person making the sale the amount of the purchase price, plus any sums paid by the purchaser to protect his interest in such property in particular, but not in limitation thereof, for such items as taxes, insurance, maintenance expenses reasonably incurred to preserve the value of the mortgaged premises, or payments on a superior lien, together with interest on the total judgment at the same rate of interest as provided in the mortgage.

[¶ 15.] In this case, Hubbel was served with Dacotah Bank’s notice of redemption, together with a check in the amount of $83,127.36 on January 3, 2002, just six days after the sheriffs certificate of sale was issued. This check represents all amounts of which Dacotah Bank had notice since prior to redemption, Hubbel had not recorded with the Register of Deeds or notified the Minnehaha County Sheriff or Dacotah Bank of any additional payments she had made to protect her interest in the property. The parties agreed in their joint stipulation of facts that Dacotah Bank was under no statutory obligation to contact Hubbel prior to attempting redemption to determine what, if any, payments she had made to protect her interest in the property.

[¶ 16.] Although the trial court held that Dacotah Bank substantially complied with the Redemption Act, we hold Dacotah Bank did, in fact, actually comply with the Redemption Act in January 2002. By serving Hubbel with its notice of redemption along with a check for the purchase price and any sums paid by the purchaser to protect her interest in the property of which Dacotah Bank had notice, Dacotah Bank actually complied with the Redemption Act. Dacotah Bank paid all expenses of Hubbel of which it had notice, and we do not impose any additional responsibility upon Dacotah Bank to make further inquiry in order for redemption to be effective. This is of course subject to the proviso that Dacotah Bank reimburse Hubbel for any amounts reasonably expended to protect her interest in the property see SDCL 21-49-34 that are brought to the Bank’s attention after initiating redemption.

CONCLUSION

[¶ 17.] The trial court correctly concluded that Dacotah Bank was entitled to the issuance of the sheriffs deed. Daco-tah Bank validly redeemed the property by actual compliance with the Redemption Act. The trial court was correct in ordering Dacotah Bank to further reimburse Hubbel for the additional expenses she incurred to protect her interest in the property.

[¶ 18.] Affirmed.

[¶ 19.] GILBERTSON, Chief Justice, and KONENKAMP, ZINTER and MEIERHENRY, Justices, concur.

[¶ 20.] ANDERSON, LEE, Circuit Judge, for SABERS, Justice, disqualified.

      . Under our decision, the purchaser incurring these expenses to protect his interest in the property has the responsibility to provide notice of the same. The trial court would have jurisdiction to order reimbursement of these expenses to the purchaser, as Judge Severson has done in this case.


author: ANDERSON, PAUL H., Justice. GILBERT, Justice

text:
    STATE of Minnesota, Respondent, v. Montell Andre DeSHAY, Appellant.
    No. C9-01-1128.
    Supreme Court of Minnesota.
    Oct. 9, 2003.

      Michael C. Davis, Special Assistant State Public Defender, St. Paul, MN, for Appellant.
    Michael A. Hatch, State Attorney General, John B. Galus, Assistant Attorney General, St. Paul, MN, Alan L. Mitchell, St. Louis County Attorney, Duluth, MN, for Respondent.
   OPINION

ANDERSON, PAUL H., Justice.

Appellant Montell Andre DeShay was charged by complaint in St. Louis County with conspiracy to commit a controlled substance crime in the first degree for the benefit of a gang, Minn.Stat. §§ 152.021, subd. 1(1) (2002), 152.096, subd. 1 (2002), and 609.229, subd. 2 (2002), and committing a controlled substance crime in the third degree for the benefit of a gang, Minn.Stat. §§ 152.023, subd. 1(1) (2002), and 609.229, subd. 2. Following a jury trial, DeShay was found guilty as charged. The district court entered a judgment of conviction for the conspiracy count and sentenced DeShay to an executed 98-month prison term. On appeal, DeShay challenged, among other things, expert testimony relating to gangs and gang affiliation. The court of appeals affirmed. Concluding that the admission of gang expert testimony was error but that the error was harmless, we affirm.

In 1999, Robert Jackley, a paid informant operating in that capacity for the Duluth police department, became acquainted with a group of seven to eight individuals who were selling crack cocaine and heroin imported from Milwaukee, Wisconsin. He knew the group members by “street names,” including “Rat,” a/k/a William Frazier, and “Animal,” a/k/a Jim Lee. Jackley observed members of this group selling drugs from several locations and purchased drugs from most of them in a series of controlled buys. He also accompanied at least one member of the group to Milwaukee for the purpose of purchasing drugs for resale in Duluth.

Jackley met DeShay in December 1999 at Lee’s home. Lee said DeShay was his nephew or cousin and introduced him as “Sickness.” Jackley witnessed DeShay selling drugs several times, and on January 13, 2000, Jackley purchased approximately 0.1 grams of crack cocaine from DeShay in a controlled buy. After the purchase, Jackley asked DeShay if, in the future, he could buy drugs at a location near Lee’s home and DeShay responded that he could. DeShay also told Jackley not to return to Lee’s home because the group no longer did business there.

At DeShay’s trial, in addition to Jackley, the following three witnesses testified to having seen DeShay selling drugs as a representative for the group: Paul Taylor and Robin Raymond' — both of whom were police informants and heroin users; and Melissa Sabrowski, a former girlfriend of a group member. Taylor and Raymond each accompanied group members on trips to Milwaukee for the purpose of acquiring cocaine and heroin. Both stated that they were given heroin in exchange for allowing the group to use their Duluth apartments to repackage and sell the drugs obtained in Milwaukee. Sabrowski testified to having witnessed the sale of heroin, crack, and powder cocaine, to having joined group members on trips to Milwaukee to restock the drug supply, and to having seen DeSh-ay hanging out with the other group members while drugs were being sold. However, Sabrowski testified that she had never witnessed DeShay selling drugs.

In addition to the testimony concerning the drug enterprise, Taylor, Raymond, and Sabrowski collectively testified that the group functioned as a criminal gang: they testified about the leadership structure of the group; the use of gang names and street names; gang colors; gang signs; gang jewelry — gold necklaces with the words “Breed” or “New Breed”; references to the group as “the Mob,” “the New Breeds,” a gang “off the G.D.s,” a common abbreviation for the established gang the Gangster Disciples; and statements by some members, though not DeShay, that they were in a gang.

As part of the state’s case-in-chief, over objection of defense counsel, Special Investigator Scott Jenkins of the Minnesota Gang Strike Force (MGSF) was permitted to testify as an expert about gangs and gang affiliation. Jenkins began by testifying about his credentials and experience. He stated that he had worked as a police officer for nearly twenty years, three years as a special investigator with the MGSF assigned to a regional unit covering eleven counties in the northeastern part of the state. Jenkins received training with the Minnesota Bureau of Criminal Apprehension, the gang unit of the Minneapolis police department, and national training on gang trends, surveillance, and working with informants. He testified about the use of informants in gang investigations and answered general questions about gangs. When asked “[w]hat sort of criminal activities are street gangs involved in,” he responded: murder for hire, murder for the benefit of a gang, large and small scale narcotics trafficking, “[i]ntimidation-type crimes,” criminal sexual assault, burglaries, property crimes, “£j]ust a whole myriad of different crimes.”

Jenkins then was asked to discuss “the information you have gathered about that particular gang [the Black Gangsters or New Breed].” Jenkins proceeded to testify about a Midwestern street gang called the “Black Gangsters,” also known as “Breed,” “New Breed,” “New Breed Disciples,” or “Trey Ls,” with which he had become familiar during his training and experiences. He stated that, as a “Midwest street gang,” the gang started in Chicago and spread to smaller urban areas like those the size of Duluth. He talked about how Midwest gangs are generally divided into two rival groups, the people nation and the folk nation, each group having common signs, slogans, colors, tattoos, and jewelry. He said the Black Gangsters or New Breed are generally aligned under the folk nation, although “in some cases they are aligned under both the folk and people depending on how it benefits their gang.”

The state then offered, for illustrative purposes, a chart created by Jenkins that purported to outline the Black Gangsters or New Breed Disciples, their representative symbols and colors, and their general alliance. Jenkins went on to talk about the gang’s symbols, many of which came from the folk nation and others which came from the people nation, “being that they could have a general a[l]liance under either one.” He talked about their main symbol which was “like a six-point star of David,” each point representing different aspects of gang life: “life, loyalty, respect, knowledge, wisdom, and so on.” He talked about other gang symbols, which were an upward facing pitchfork, a rabbit head with a cocked ear or a bent ear, and a heart with horns.

After this testimony, the state asked Jenkins, “[W]hat type of [criminal] activities or pattern of [criminal] activities is [this particular gang] involved with?” He proceeded to describe the gang’s drug trafficking operations, person crimes of drive-by shootings and assaults, including sexual assaults, and property crimes including burglary and theft. He talked generally about how gang members gain “rank” by committing crimes or being born into the gang. He talked about how gang members would be held accountable to the gang, although differing “from gang to gang,” with penalties ranging from exclusion from the gang “to a homicide.” His testimony included a general discussion of how gangs often employ local people to facilitate their criminal enterprises by providing places to sell or hide drugs, delivering messages, and using their names for financing things like cars or cell phones.

Jenkins was then asked to discuss the ten-point gang identification criteria adopted by the Criminal Gang Oversight Council and used by MGSF to determine gang membership. For illustrative purposes, Jenkins offered the list of the criteria. Jenkins also explained the derivation of the criteria, noting that the criteria ultimately adopted were based in large part upon criteria already in use on the West Coast and in other areas of the Midwest, like Chicago and Detroit: “[T]hese criteria are a conglomeration of all of those things that have been grabbed from other areas of the nation.” The state then began the process of going through the criteria, asking Jenkins the factors he looked to when determining gang affiliation. Jenkins then went through all ten of the criteria and explained the significance of each one, providing examples for some and explanations for why others were considered to have predictive value of gang membership.

The state next asked about the MGSF’s records on individual gang involvement and investigation and about the use of street names by gang members. Jenkins stated that street names are very common and are often very similar to each other and the MGSF database helps investigators track individuals according to their legal and street names’. He then explained that when the MGSF tracks an individual, the protocol is that if the individual has one or two of the ten-point gang criteria, he is classified as a suspected gang member or an associate. “If they have three or more criteria total, then they’re considered a confirmed gang member. If they have three or more of the criteria total, plus a gross misdemeanor or felony conviction, or an adjudication as a juvenile for a felony, then they’re considered confirmed convicted.”

The state then proceeded to ask Jenkins specific questions about his investigation of the New Breed in Duluth. Jenkins then testified about his knowledge of the drug trafficking ring and his assignment to track the associated parties. He described collecting information from police informants, interviews conducted by the MGSF and narcotics investigators within the Duluth police department, police reports, arrest records, and interviews he personally conducted with some of the suspected gang members. He then gave the names of the individuals he became familiar with in the context of the investigation, beginning with an individual he said was “believed to be the leader of this group of gang members.” He went on to name others, including “Frazier, who is a Black Gangster and is known by the street name of Rat,” and “Jim Lee, also a documented Gangster Disciple, who is a close associate of the Black Gangsters.” Jenkins said Lee “is known by the street monnikar [sic] of Animal.” Jenkins finished the list of eight individuals, six of whom he specifically stated had a gang affiliation, with “Montell DeShay, who is also known as Sickness. I believe that covers the group.”

Next, the court permitted the state to introduce, for illustrative purposes, charts Jenkins had prepared as “documenting the ten point criteria with the individual names of the parties that [he] just mentioned.” The state then asked Jenkins, based on his “investigation, and gathering information from various agencies and [his] interviews,” to match gang identification criteria to the individuals named on the charts. After referencing his investigative notes, Jenkins proceeded to identify which of the ten criteria applied to each of the individuals on the charts, adding that some of the individuals had convictions for controlled substance crime committed for the benefit of a gang, sexual assault, and auto theft. Jenkins identified three criteria that applied to DeShay: observed to associate on a regular basis with known gang members; identified as a gang member by a reliable source — Sobrowski; and arrested in the company of identified gang members or associates. After going through all the individuals on the exhibit charts, Jenkins was allowed to offer his opinion that five of the individuals on the charts, one of whom was DeShay, were members of the New Breed-Black Gangsters gang.

On cross-examination, Jenkins admitted that he had not been personally involved in collecting the information that led to classifying DeShay as someone who associated on a regular basis with known gang members. Defense counsel asked similar questions related to the other criteria used by Jenkins to classify DeShay as a gang member. Through questioning, defense counsel got Jenkins to confirm that his “opinion is based upon [MGSF] criteria, and [it] ⅜ ⅜ * is the basis upon which [he said] that Montell DeShay is a gang member.”

DeShay chose not to testify in his own behalf. Lee’s wife, Katherine Cisotto, appeared for the defense. Cisotto testified that DeShay did not sell drugs from her home in January 2000 and that she had no knowledge of any drug sales from her home in December 1999 or January 2000. Cisotto also stated that, to her knowledge, Jackley had not been in her home, Taylor had been in her home only once or twice, and Raymond was there only once on December 3, 1999 for a reason unrelated to drugs. On cross-examination, Cisotto admitted that her daughter, who had been living in the home with her and Lee in December 1999 and January 2000, had been convicted of selling drugs to Jackley from that home on December 1,1999.

The jury found DeShay guilty of conspiracy to commit a controlled substance crime for the benefit of a gang and committing a controlled substance crime for the benefit of a gang. Judgment was entered on the conspiracy conviction and DeShay was sentenced to a presumptive executed term of 86 months for the underlying conspiracy crime and an additional 12 months for the benefit-of-a-gang crime. Minnesota Sentencing Guidelines II.G. DeShay appealed, challenging, among other things, the admissibility of the gang expert testimony. The court of appeals affirmed, finding no error in the admission of the expert testimony, and we granted further review.

I.

The first issue we address is the admissibility of gang expert testimony. We have consistently stated that determinations of an expert witness’s competency and the adequacy of the foundation offered in support of expert witness testimony are matters that rest within the sound discretion of the district court and we will not reverse absent clear error. State v. Nystrom, 596 N.W.2d 256, 259 (Minn.1999) (citing State v. Koskela, 536 N.W.2d 625, 629 (Minn.1995)). The issue here, however, is not whether the expert was competent or relied on an adequate foundation for his testimony, but whether the issues and subject matter were appropriate for expert testimony.

Minnesota Rule of Evidence 702 provides that an expert may testify “in the form of an opinion” if his or her “scientific, technical, or other specialized knowledge will assist the trier of fact to understand the evidence or to determine a fact in issue.” The “ultimate question of admissibility” for expert testimony is whether the expert’s testimony will help the trier of fact in evaluating evidence or resolving factual issues. Koskela, 536 N.W.2d at 629. Minnesota courts have allowed law enforcement officers to provide expert testimony in a number of criminal contexts. In State v. Klawitter, 518 N.W.2d 577 (Minn.1994), we allowed opinion testimony by experienced police officers trained in the use of drug recognition protocol. Id. at 586. In State v. Sandberg, 406 N.W.2d 506 (Minn.1987), a police officer was permitted to testify as an expert concerning the reporting practices of adolescent sexual assault victims. Id. at 511. In City of St. Paul v. Various Items of Drug Paraphernalia, 474 N.W.2d 413 (Minn.App.1991), a police officer was permitted to testify as an expert regarding the primary use of seized items as drug paraphernalia. Id. at 418. In all of these cases, expert police testimony added “precision or depth to the jury’s ability to reach conclusions,” State v. Helterbridle, 301 N.W.2d 545, 547 (Minn.1980), even on subjects within the jury’s common experiences and, therefore, satisfied the helpfulness test. See State v. Bradford, 618 N.W.2d 782, 793 (Minn.2000).

Nevertheless, we have stated that, especially in criminal cases, district courts should exercise caution in admitting expert testimony because of the potential for experts with specialized knowledge to unduly influence the jury. See Nystrom, 596 N.W.2d at 259-60. For that reason, we concluded that expert police testimony about statistical crime rates and criminal activity in the community was inadmissible because the testimony would not have been helpful to the jury and was not relevant to the defendant’s proffered self-defense theory. See id. at 260.

We previously touched on the issue of gang expert testimony in State v. Yang, 644 N.W.2d 808 (Minn.2002). In Yang, we questioned the propriety of gang expert testimony from a former MGSF member given as a rebuttal witness for the state:

It is much less clear whether the expert testimony from Straka was similarly appropriate. Straka’s testimony was cumulative with respect to Yang’s testimony that he used to associate with gang members, that he had a gang tattoo, and that his gang was involved in violent crimes. Further, Straka went beyond what Yang himself testified to and discussed the official gang strike task force gang-membership criteria and stated that in his opinion Yang was currently a gang member. Nonetheless, even if the admission of such evidence was error, we will reverse Yang’s conviction only if we conclude that the error was not harmless beyond a reasonable doubt. * * * * Here we hold that in light of Yang’s own gang-related testimony, Straka’s testimony was harmless beyond a reasonable doubt.

Id. at 818.

We have consistently expressed our concern that expert testimony be carefully monitored in criminal cases so that a jury is not dissuaded from exercising its own independent judgment. See Nystrom, 596 N.W.2d at 259-60; Klawitter, 518 N.W.2d at 585. We have been “very reluctant to allow experts to testify about matters that are generally for the jury’s determination.” State v. Ritt, 599 N.W.2d 802, 812 (Minn.1999). “If the issue can be resolved by applying principles of general or common knowledge and the jury is in as good of a position to resolve an issue as the expert, then expert testimony would be of little assistance to the jury and should not be admitted.” 11A Peter N. Thompson & David F. Herr, Minnesota Practice—Courtroom Handbook of Minnesota Evidence, 152 (2003 ed.).

Here, the jury needed to decide certain specific factual issues. First, it needed to determine if DeShay committed a crime. Then, it needed to determine whether this particular group of people was a criminal gang and whether DeShay was a member of or associated with the group. See Minn.Stat. § 609.229, subd. 1. Next, it needed to decide if the crime was committed “for the benefit of, at the direction of, in association with, or motivated by involvement with a criminal gang.” Minn,Stat. § 609.229, subd. 2. Finally, it needed to determine if the act was done with the “intent to promote, farther, or assist in criminal conduct by gang members.” Id. To have been admissible, Jenkins’ expert testimony must in some way be helpful to the jury when making these factual determinations. We conclude that much of it was not.

Gang’ expert testimony in this noncom-plex drug conspiracy, to the extent relevant, was largely duplicative, giving little assistance to the jury in evaluating the evidence. Witnesses with first-hand knowledge had already testified that DeShay was associated with a group that included at least three people; that the group, the New Breed, came from Milwaukee; that the New Breed was related to the Gangster Disciples gang; that the New Breed group’s primary activity was a profitable drug trafficking operation; that the New Breed group used nonmember drug addicts to facilitate the transportation and sale of drugs; that the group had a gang name, New Breed, used gang terms, flashed gang signs, and referred to the group as a gang. This first-hand knowledge testimony is how the state can and should go about proving the essential elements of this crime. Further, it was neither helpful nor relevant to the fact issues before the jury to have expert testimony that crimes committed by criminal gangs in general run the gamut from “murder for hire” to property crimes, that New Breed gangs engage in drive-by shootings, or that certain individuals associated with the New Breed group involved in this case had prior convictions for criminal sexual conduct and crimes committed for the benefit of a gang.

That jurors do not need extensive testimony from an expert to enlighten them on indicia of gang membership is borne out by the state’s closing argument to the jury during which the state told the jurors that these crimes are basically a matter of witness credibility. While benefit-of-a-gang expert testimony logically adds nothing to witness credibility, it does strongly suggest to the jury that a law enforcement specialist believes the state’s witnesses and therefore the jury should find the defendant guilty. There are, no doubt, cases where the testimony of an expert may prove helpful on aspects of criminal gangs, but this is not one of those cases. See United States v. Lui, 941 F.2d 844, 848 (9th Cir.1991) (holding that modus operan-di testimony is generally inadmissible, although such testimony might be admissible in cases involving complex smuggling conspiracies).

Moreover, the state should not be permitted to launder inadmissible hearsay evidence, turning it into admissible evidence by the simple expedient of passing it through the conduit of purportedly “expert opinion.” That criminal gang involvement is an element of the crime does not open the door to unlimited expert testimony. See, e.g., State v. Brom, 463 N.W.2d 758, 763-64 (Minn.1990) (holding that psychiatric testimony on issues of intent and premeditation in murder trial properly excluded); State v. Helterbridle, 301 N.W.2d 545, 547 (Minn.1980) (holding expert testimony on unreliability of eyewitness identification in robbery trial properly excluded); State v. Yates, 392 N.W.2d 30, 32 (Minn.App.1986) (holding expert testimony on issue of specific intent in aggravated assault trial properly excluded).

Finally, the allegation that a defendant is in a gang ought not serve as a justification for extensive expert testimony regarding criminal gangs. Cf. United States v. Lombardozzi, 2003 WL 1907965, at *3-4, — F.Supp.2d -, - (S.D.N.Y.2003) (“The allegation that a defendant is in the mob is not a shibboleth, the mere incantation of which opens the door to extensive expert testimony regarding organized crime”; and holding that expert testimony regarding structure of organized crime families must be limited to the extent necessary to understand relationship between defendant and former defendant who pleaded guilty); United States v. Alatorre, 222 F.3d 1098, 1099 (9th Cir.2000) (affirming trial court ruling that expert testimony about the value of marijuana seized and whether it was of a distributable quantity was admissible, but organization and structure of drug enterprise was not admissible unless defense opened the door); United States v. Long, 917 F.2d 691, 702-03 (2d Cir.1990) (holding that expert testimony regarding hierarchical structure and methods of operation of crime families improperly introduced in RICO prosecution); Utz v. Commonwealth, 28 Va.App. 411, 505 S.E.2d 380, 386 (1998) (holding that trial court properly limited gang expert evidence to that which was relevant to show motive other than self-defense for shooting the victim). Seemingly unlimited development of the roles and activities of gangs in general and gangs unrelated to the defendant is unnecessary, potentially prejudicial and, as a practical matter, places the defendant in the position of defending allegedly criminal activities of others, regardless of formal charges.

In summary, we conclude that expert testimony must assist the jury to understand the evidence or to determine a fact in issue. The district court should scrutinize proffered gang expert testimony, preferably outside the presence of the jury, “and exclude it where irrelevant, confusing, or otherwise unhelpful.” State v. Miles, 585 N.W.2d 368, 371 (Minn.1998). Such testimony must add precision or depth to the jury’s ability to reach conclusions about matters that are not within its experience. Moreover, this testimony must be carefully monitored by the court so that the testimony will not unduly influence the jury or dissuade it from exercising its independent judgment. Even if acceptable under Rule 702, expert testimony should be excluded if its probative value is substantially outweighed by the danger of unfair prejudice. Minn. R. Evid. 403. In this noncomplex drug conspiracy case, much of the gang expert’s testimony was duplicative and of little real assistance to the jury in evaluating the evidence. Therefore, inasmuch as there was little, if any, real value to much of the gang expert testimony, especially when considered in light of its probative value versus potential prejudice, we hold that its admission was error.

II.

Having determined that Jenkins’ gang expert testimony was inadmissible, we must now determine whether admission of that testimony was sufficiently prejudicial to justify a new trial. “ ‘Reversal is warranted only when the error substantially influences the jury’s decision.’ ” State v. Chomnarith, 654 N.W.2d 660, 665 (Minn.2003) (quoting State v. Nunn, 561 N.W.2d 902, 907 (Minn.1997)). As indicated, Jenkins’ testimony was, for the most part, duplicative of testimony given by witnesses with first-hand knowledge of the relevant events and which established that DeShay was a member of, and involved with, a group that operated as a criminal gang. Accordingly, we hold that any error that may have occurred by admitting Jenkins’ gang expert testimony was harmless because, in light of the other witnesses’ testimony, there was no reasonable possibility that Jenkins’ testimony substantially influenced the guilty verdict.

Affirmed.

HANSON, Justice, took no part in the consideration or decision of this case.

GILBERT, Justice

(concurring specially)-

I concur with the result of the majority’s opinion, which affirms the court of appeals’ holding, but respectfully disagree with the majority’s analysis, which finds that admission of gang-related expert testimony was error. I would not only affirm the conviction, but also apply the court of appeals’ analysis on gang-related expert testimony.

The appellant was charged with a conspiracy to commit a controlled substance crime in the first degree for the benefit of a gang and for the commission of a controlled substance crime in the third degree for the benefit of a gang. The legislature passed this legislation as a part of an effort to target the growth of gang-related criminal activity. Under these statutes, the state has the burden to prove beyond a reasonable doubt that there was criminal activity committed for the benefit of a gang. Proving this necessarily involves proof of this behavior and that it occurred for the “benefit of a gang.” Proving this element may undoubtedly be prejudicial. However, the question unanswered by the majority opinion is: how can the state prove this essential element, if not through expert testimony?

The court of appeals affirmed the district court’s use of the gang testimony offered by special investigator Scott Jenkins of the Minnesota Gang Strike Task Force (MGSF). The court of appeals pointed out that the appellant challenged the use of this testimony based on:

the witness’s methodology; that is, the set of observations and conclusions making up the ten-point gang criteria on which the witness relied in giving his opinion that De Shay [sic] and others were gang members. This does not concern the facts or data on which the witness relied; the phrase “facts or data” in this context refers to the facts in the particular case in which the witness is testifying and that the witness has accepted as true in giving his opinion. Facts or data are to be distinguished from the methodology the witness applied in giving his opinion.

State v. DeShay, 645 N.W.2d 185, 191 (Minn.App.2002) (emphasis in original).

The court of appeals concluded that “there is an ample showing of the reliability of the ten-point gang criteria, sufficient to allow an expert to utilize them in forming an opinion on whether an individual is a member of a gang. The criteria were authorized by the legislature. Minn.Stat. § 299A.64, subd. 2(b) (2000).” Id. at 192. The court noted that law enforcement experts in the field rely on the gang identification criteria, that it is common practice for experts in a number of other jurisdictions to rely on similar gang criteria, and that this type of criteria is the type relied upon by experts in the field. Id.

The court of appeals also pointed out that the evidence of gang criteria was offered to prove an element of the offense; that the crime was for the benefit of a gang and “[i]n fact, DeShay does not assert that the criteria are being used as character evidence; instead, he attacks them as being an improper basis for an expert opinion.” Id. at 193. The court of appeals concluded that because most of these criteria “are primarily elements of self-identification for people who have an interest in being identified with a group,” this focus is “on a much narrower group of persons” than the “external criteria” we addressed in the drug courier profile case of State v. Williams, 525 N.W.2d 538, 546-48 (Minn.1994). Id.

The appellant also raised an equal protection argument relating to Minn.Stat. § 609.229, but conceded that if this court affirmed the court of appeals’ holding in State v. Frazier, 631 N.W.2d 432, 437 (Minn.App.2001), that holding would be dispositive of this issue. We affirmed the court of appeals on the equal protection argument, but on different grounds. See State v. Frazier, 649 N.W.2d 828, 836-37 (Minn.2002). Our holding in Frazier was based, in part, upon the appellant’s failure to present information from any source which would enable us to evaluate whether the MGSF criteria are reliable indicators of gang membership. Id. at 835. In fact, we stated that “[b]ecause neither party presented any analysis of the data or expert testimony, we lack an adequate record to evaluate whether section 609.222 creates a race-based classification in practice.” Id. at 836. We further explained that “[w]hat we do require, however, is a factual record that permits us to evaluate the reliability and validity of both the data and the data analysis.” Id.

In this case, we are again confronted with an equal protection argument with a similarly deficient record. There is no analysis of the data, no expert or rebuttal testimony, and no cross-examination challenging the reliability and validity of the evidence presented. Notwithstanding this lack of a record and the absence of a motion in limine or appropriate and/or timely objection to this testimony, the majority opinion concludes that to admit such expert testimony was error. Based on some general concerns about the helpfulness of the ten criteria that was developed by the gang strike task force and because the expert’s testimony “was, for the most part, duplicative” of other testimony, the majority opinion concludes that this testimony was of “little real assistance to the jury in evaluating the evidence.” The majority further adds that the jury did not need extensive expert assistance to enlighten them as indicia of gang membership and that expert testimony was neither helpful nor meaningful. I agree that “first-hand knowledge testimony is how the state can and should go about proving the essential elements of this crime,” but that is not necessarily the best or only way to do so. Expert testimony may be helpful or necessary in this type of case. The majority may be opening the door to more gang-related Spreigl-type evidence in the process. Finally, the majority, notwithstanding its concerns, concludes that this error “was harmless because, in light of the other witnesses’ testimony, there was no reasonable possibility that Jenkins’ testimony substantially influenced the guilty verdict.” Although no record had been presented to sustain any constitutional challenge to this statute or this evidence, the majority makes a policy-based ruling that may effectively exclude expert testimony on gangs.

The appellant in this case was charged with a crime that benefited the “Black Gangsters,” also known as the “New Breed Disciples,” the “Breed,” the “New Breed,” or the “Trey Ls.” Now, even though there was no constitutional basis to challenge this statute or this testimony in this record, the majority excludes it on an eviden-tiary basis, which typically rests within the sound discretion of the district court and which we do not reverse absent clear error. State v. Koskela, 536 N.W.2d 625, 629 (Minn.1995).

There is nothing in the record to indicate that the use of this testimony was “clear error.” The majority opinion rejects this testimony on a lower standard than we have ever used in this type of analysis by holding that its admission was “error.” There was nothing clear about the error and there is no factual record that challenges the reliability and validity of both the data and the data analysis presented by this expert. Without declaring Minn.Stat. § 299A.64, subd. 2(b) (2002) unconstitutional, the majority has rendered this statute meaningless. Although the majority finds the error harmless in this case because the expert’s testimony was largely duplicative, the majority does not cite one case in Minnesota where we have held that it is a clear abuse of discretion for the district court to allow the introduction of cumulative evidence into the record or explain why cumulative evidence leads to a clear abuse of discretion. Minnesota Rules of Evidence 702 generally allows expert testimony if it will assist the jury in resolving factual questions presented. State v. Grecinger, 569 N.W.2d 189, 195 (Minn.1997).

The fact that media coverage is replete with sensational stories of gang violence, both real and fictionalized through numerous televised sequences, makes the testimony of a reliable expert all the more essential. It not only adds precision and depth to a jury’s understanding of the way in which gangs actually operate, but it also removes some of the sensationalism and fiction that television viewers are constantly bombarded with. There is nothing in this record to establish that this expert testimony was “irrelevant, confusing or otherwise unhelpful.” State v. Miles, 585 N.W.2d 368, 371 (Minn.1998). Further, the majority fails to cite a single case where a court has concluded that expert gang testimony, although relevant, was otherwise inadmissible based on a conclusion that the jurors are sufficiently knowledgeable about the operation and characteristics of gangs such that an expert’s opinion would not be helpful and therefore inadmissible. The majority’s analysis is flawed in that it improperly conflates the determination that the expert’s testimony would not be helpful with the discussion relating to the possible cumulative nature of some aspects of this testimony. It is also unclear which part of Officer Jenkins’ testimony was admitted in clear error. The majority bolsters its arguments with a lengthy footnote citing a number of commentaries that were not part of the record or developed in the district court. This type of information should not be injected at this late stage in the proceedings to justify an otherwise untenable position. The majority also adds an unjustifiable caveat that characterizes this case as a “noncomplex drug conspiracy case.” Such labeling does nothing to advance the majority’s analysis and creates a new distinction among drug cases that will only cause confusion in the district courts as those courts attempt to apply the new rule of law on experts embodied in the majority’s decision.

Contrary to what the majority implies, most of Jenkins’ testimony was never objected to at trial. There were six hearsay objections. The first objection was responded to by a rephrasing of the question with no follow-up objection. There was also one foundation objection, which led to the court instructing counsel to provide additional foundation. This additional foundation was provided and there was no follow-up objection. Two additional foundation objections were made and overruled: one question related to the general nature of this particular gang and the other was “how does a person typically rank within inside a gang?” There was also an objection to nonresponsive testimony as being beyond the scope of the question, which was overruled, and a hearsay objection concerning the general nature of this particular gang. Other than that, Jenkins’ testimony came into the record without objection.

Similarly, the introduction of a number of gang-related exhibits were offered by the state and received in the record for illustrative purposes. Defense counsel specifically stated on the record that he had no objection to their introduction. These exhibits include Exhibit 9, which “outline[d] the Black Gangsters or New Breed Disciples; their representative symbols, their representative colors, and their general al[l]iance, whether folk or people.” Exhibit 10, which was “a copy of our State Gang Planner System, or State Gang Criteria System” — a list of the ten criteria that were used to objectively analyze and document gang membership. Finally, there were Exhibits 11, 12 and 13, introduced as a group, which were “charts documenting the ten-point criteria with the individual names of the parties that I just mentioned.” Any objection to this testimony was indisputably waived. After all of this evidence was in at the end of the testimony, defense counsel did state that he has one “continuing ongoing objection to this entire line of testimony.” This came in the record after 33 pages of trial testimony and receipt of the five exhibits identified above. A belated objection such as this has never before been used to create a basis to analyze otherwise unob-jected — to testimony already in the record. The two foundation objections that were made relating to a particular gang and the way one gets ranked within a gang should not be used by the majority to expand the objection to encompass everything else that this officer testified to. A continuing objection after the fact and after the evidence in the record can be a clever ploy to cover up possible mistakes by defense counsel, or an attempt to creatively expand the scope of the previous specific and limited objections. However, this court should not fall for such a ploy. We should base our decision on the record and by following precedent.

The majority also takes issue with the testimony of Officer Jenkins concerning the “whole myriad of different crimes” that street gangs were involved with. However, this testimony was also introduced into the record without any objection, as was the testimony concerning the division of gangs into a “people nation and a folk nation.” The majority does mention that “the district court overruled seven objections defense counsel made,” which is true but is only part of the story. The majority omits discussing the rehabilitative questioning that occurred in response, the lack of objection thereafter, and the limited nature of the two foundation objections.

Based on this record and the fact that gang and gang-related activities are an essential element of the state’s proof beyond a reasonable doubt, I would affirm the court of appeal’s analysis and allow such testimony.

      . A criminal gang is defined as:
      [a]ny ongoing organization, association, or group of three or more persons, whether formal or informal, that:
      (1)has, as one of its primary activities, the commission of one or more of the offenses listed in section 609.11, subdivision 9 [including felony controlled substance crimes];
      (2) has a common name or common identifying sign or symbol; and
      (3) includes members who individually or collectively engage in or have engaged in a pattern of criminal activity.
      Minn.Stat. § 609.229, subd. 1 (2002).
      The crime itself is defined in subdivision two as follows:

        A person who commits a crime for the benefit of, at the direction of, in association with, or motivated by involvement with a criminal gang, with the intent to promote, further, or assist in criminal conduct by gang members is guilty of a crime and may be sentenced as provided in subdivision 3.

        Id., subd. 2.

      . During the course of Jenkins’ testimony, the district court overruled seven objections defense counsel made, including one "continuing ongoing objection to this entire line of testimony,” which indicates that it might have been preferable to have qualified this witness as an expert outside the presence of the jury. Cf. United States v. Alatorre, 222 F.3d 1098, 1105 (9th Cir.2000) (stating that while federal courts are not required to conduct separate pretrial hearings to discharge evidentiary ga-tekeeping duties related to gang expert testimony, district courts should be mindful of difficulties in exploring an expert’s qualifications and basis for the expert's opinion and give due consideration for requests that voir dire occur outside presence of jury).

      . The ten criteria listed by Jenkins are as follows: (1) admits gang membership or association; (2) is observed to associate on a regular basis with known gang members; (3) has tattoos indicating gang membership; (4) wears gang symbols to identify with a specific gang; (5) is in a photograph with known gang members and/or using gang-related hand signs; (6) name is on a gang document, hit list, or gang-related graffiti; (7) is identified as a gang member by a reliable source; (8) arrested in the company of identified gang members or associates; (9) corresponds with known gang members or writes and/or receives correspondence about gang activities; and (10) writes about gangs, which would be graffiti on walls, books, and/or paper. See also State v. Frazier, 649 N.W.2d 828, 834-35 (Minn.2002).

      . The Criminal Gang Oversight Council consists of the Commissioners of Public Safety and Corrections, the Superintendent of the Bureau of Criminal Apprehension, the Attorney General, and several police chiefs, sheriffs, and other law enforcement officers. Minn.Stat. § 299A.64, subd. 1 (2002). As part of its mandate to develop strategy to address the harm posed by criminal gangs, the council was directed to “develop criteria and identifying characteristics for use in determining whether individuals are or may be members of gangs involved in criminal activity.’’ Minn.Stat. § 299A.64, subd. 2(b) (2002). The council was also directed to "develop procedures and criteria for the investigation of criminal gangs and crimes committed by those gangs throughout the state.” Id.

      . On September 8, 2003, DeShay moved to reopen this appeal to allow additional briefing and oral argument on a new issue, generated by our opinion in State v. Harris, 667 N.W.2d 911 (Minn.2003) (holding that defendant was entitled to a new trial because the judicial officer before whom his case was tried did not have jurisdiction to preside over felony trials). DeShay contends that under Harris he is entitled to a new trial because his case was also tried before the judicial officer who heard the Harris case. We held that Harris will apply prospectively to "pending” cases. The state opposes relief here, arguing that Harris should not apply because DeShay did not raise the judicial officer issue before the district court or in his direct appeal. The state asserts that raising the issue post-briefing and post-argument bars any relief.
      We decline to delay the release of our decision of this case and its companion case, State v. Lopez-Rios, — N.W.2d -, (Minn. 2003), for briefing and argument of the judicial officer issue. Nevertheless, because DeShay sought to raise this issue before the completion of his direct appeal, we conclude he should not be foreclosed from arguing that Harris should apply. We therefore will allow DeShay to address the issue in a postconviction proceeding. By doing so, we do not express any opinion on whether this procedural posture should be treated as a "pending” appeal entitled to relief under Harris.

      . The special concurrence expresses concern that defense counsel failed to make specific and timely objections to the gang expert’s testimony. As indicated earlier, defense counsel made numerous objections to this testimony, all of which were overruled. We conclude that the defense's objections were sufficient to preserve the issue for review here. Moreover, " '[a]n accused, whether guilty or innocent, is entitled to a fair trial, and it is the duty of the court, and of prosecuting counsel as well, to see that he gets one.' ” State v. Litzau, 650 N.W.2d 177, 185 n. 6 (Minn.2002) (quoting State v. Haney, 222 Minn. 124, 125, 23 N.W.2d 369, 370 (1946)).

      . We are also concerned with the helpfulness of the ten criteria developed by the Gang Strike Force. Jenkins stated that an individual is an imputed gang member if he meets one or two of the criteria and is considered a confirmed gang member if he meets three or more of the criteria. Yet certain of the criteria may involve the exact same evidence so that a person could be considered a confirmed gang member because the exact same evidence meets two of the criteria. For example, the same evidence can satisfy criterion # 2 "is observed to associate on a regular basis with known gang members or individuals who have already been classified as such using these criteria” and criterion # 8 "is arrested in the company of identified gang members or associates.”

      . As for the Minnesota Gang Strike Force identification criteria, several commentators consider the criteria unreliable in the identification of gang members. Plácido G. Gómez, It is Not So Simply Because an Expert Says it is So: The Reliability of Gang Expert Testimony Regarding Membership in Criminal Street Gangs: Pushing the Limits of Texas Rule of Evidence 702, 34 St. Mary’s L.J. 581, 609-621 (2003) (describing the manner in which the criteria lack reliability); Jeffrey J. Mayer, Individual Moral Responsibility and the Criminalization of Youth Gangs, 28 Wake Forest L.Rev. 943, 965-67 (1993) (noting that the various criteria were "invariably overbroad," notable for "their circuitry and potential for abuse" and amount to "little more than licenses to arrest or control youths in the absence of any articulable suspicion”); see also Susan L. Burrell, Gang Evidence: Issues for Criminal Defense, 30 Santa Clara L.Rev. 739, 773 (1990) ("There is no way for an individual officer to become qualified to render [a gang] expert opinion, because there is no reliable, generally accepted body of knowledge upon which the opinion may rest.”). In addition, the criteria are merely a profile, " 'simply an investigative technique. It is nothing more than a listing of characteristics that in the opinion of law enforcement officers are typical of a person engaged in a specific illegal activity.' ” People v. Hubbard, 209 Mich.App. 234, 530 N.W.2d 130, 132-33 (1995) (quoting United States v. McDonald, 933 F.2d 1519, 1521 (10th Cir.1991)). The United States Supreme Court offered a more tailored definition in Florida v. Royer, 460 U.S. 491, 103 S.Ct. 1319, 75 L.Ed.2d 229 (1983), where a "drug courier profile” was described as "an abstract of characteristics found to be typical of persons transporting illegal drugs.” Id. at 493 n. 2. Profile evidence, akin to character evidence, is plainly inadmissible as substantive evidence of guilt. Litzau, 650 N.W.2d at 185 (citing State v. Williams, 525 N.W.2d 538, 548 (Minn.1994)); see also State v. Loebach, 310 N.W.2d 58, 63 (Minn.1981) (battering parent profile evidence inadmissible).

      . Minn.Stat. § 152.021, subd. 1(1) (2002); Minn.Stat. § 152.023, subd. 1(1) (2002); Minn.Stat. § 152.096, subd. 1 (2002); and Minn.Stat. § 609.229, subd. 2 (2002).

      . Interestingly, in the only federal district court case quoted by the majority as persuasive authority to support its holding, the court held permissible expert gang testimony relating to both the defendant’s gang membership and the manner in which the defendant's gang resolved disputes between members. United States v. Lombardozzi, 2003 WL 1907965 at *4, - F.Supp.2d - (S.D.N.Y. April 17, 2003).


author: /s/ Paul H. Anderson Associate Justice

text:
    In re Petition for DISCIPLINARY ACTION AGAINST Stephen Jon RONDESTVEDT, a Minnesota Attorney, Registration No. 195431.
    No. A03-1420.
    Supreme Court of Minnesota.
    Oct. 9, 2003.
   ORDER

The Director of the Office of Lawyers Professional Responsibility has filed a petition for disciplinary action alleging that respondent Stephen Jon Rondestvedt has committed professional misconduct warranting public discipline, namely, misappropriation of more than $700,000 of client funds, neglect and misrepresentations in unrelated client matters in violation of Minn. R. Prof. Conduct 1.3, 1.4, 1.5(c), 3.2, 4.1, and 8.4(b) and (c).

Respondent has waived his right to answer the petition and understands that the allegations of the petition are deemed admitted. Respondent has waived his right to a hearing under Rule 14, Rules on Lawyers Professional Responsibility (RLPR), and has entered into a stipulation with the Director in which they jointly recommend that the appropriate discipline is disbarment from the practice of law and payment of $900 in costs under Rule 24, RLPR.

This court has independently reviewed the file and approves the jointly recommended disposition.

Based upon all the files, records and proceedings herein,

IT IS HEREBY ORDERED that respondent Stephen Jon Rondestvedt is disbarred from the practice of law effective immediately. Respondent shall pay $900 in costs under Rule 24, RLPR.

BY THE COURT:

/s/ Paul H. Anderson Associate Justice


author: GILBERT, Justice.

text:
    Debra Jane MILLER, Appellant, v. ONE 2001 PONTIAC AZTEK, # GHS-186, VIN: 3G7DA03E41S500032, Defendant, City of Bloomington, Respondent.
    No. C8-02-613.
    Supreme Court of Minnesota.
    Oct. 16, 2003.

      Leonard Castro, Chief Fourth District Public Defender, Barbara S. Isaacman, Assistant Hennepin County Public Defender, Minneapolis, MN, for Appellant.
    Sandra Henkels Johnson, Associate Bloomington City Attorney, Bloomington, MN, for Respondent.
   OPINION

GILBERT, Justice.

The facts in this case are undisputed. On June 6, 2001, in the City of Blooming-ton, Debra Jane Miller, appellant, was arrested for gross misdemeanor driving while impaired (DWI) pursuant to Minn. Stat. § 169A.20, subd. 1(5) (2000). Approximately 7 months earlier, on November 16, 2000, appellant was arrested for gross misdemeanor DWI, having a blood-alcohol content (BAC) of .26. On January 25, 2001, appellant was convicted of the first offense and, on July 11, 2001, appellant was convicted of the second DWI offense.

Appellant’s second DWI conviction qualified as a “first-degree” conviction. A person is guilty of first-degree DWI if “two or more aggravating factors” are present. MinmStat. § 169A.25, subd. 1 (2000). Aggravating factors include a second DWI conviction within a 10-year span and with a BAC higher than .20. Minn.Stat. § 169A.03, subd. 3 (2000). Appellant’s first-degree DWI constituted a “designated offense,” which qualified appellant’s vehicle for forfeiture. See Minn.Stat. § 169A.63, subd. 1(d)(1) (2000) (stating that “designated offense” includes a violation of section 169A.20, driving while impaired, under circumstances described in section 169A.25, first-degree driving while impaired), Minn.Stat. § 169A.63, subd. 2 (2000) (providing for seizure of motor vehicle involved in designated offense).

Appellant filed a demand for judicial determination per MinmStat. § 169A.63, subd. 8 (2000). The City of Bloomington moved for summary judgment. The district court denied the City’s motion for summary judgment and ordered an evi-dentiary hearing. At appellant’s January 14, 2002, forfeiture hearing, she provided her financial information. She testified that she was laid off from her employment in September 2000, and received a severance package worth $79,200, of which she spent $16,000 on the 2001 Pontiac Aztek that was subject to forfeiture. Appellant remained unemployed and collected state unemployment benefits. Appellant had no dependents, but argued that she would be severely restricted without the proceeds of her automobile forfeiture.

After the hearing, the district court held that, due to appellant’s financial condition, any forfeiture of appellant’s vehicle exceeding $1,000 would violate the Excessive Fines Clauses of the United States and Minnesota Constitutions. It ordered the City to sell appellant’s vehicle, waive any storage fees, keep $1,000, and remit all remaining funds back to appellant.

The court of appeals reversed the district court’s decision. It held that the district court erred in considering appellant’s personal financial situation. After applying a gross disproportionality test, the court of appeals determined that the forfeiture was not excessive. It remanded with instructions to order the vehicle forfeited pursuant to Minn.Stat. § 169A.63. We affirm.

I.

Cases involving the constitutionality of a statute are questions of law which we review de novo. State v. Rewitzer, 617 N.W.2d 407, 412 (Minn.2000); Matter of Blilie, 494 N.W.2d 877, 881 (Minn.1993); State Farm Ins. Cos. v. Seefeld, 481 N.W.2d 62, 64 (Minn.1992).

The United States and Minnesota Constitutions both protect individuals from excessive fines. See U.S. Const, amend. VIII (“Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted.”); Minn. Const, art. I § 5 (“Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted.”). We have previously stated that “[a] large discretion is necessarily vested in the legislature to impose penalties sufficient to prevent the commission of an offense, and it would have to be an extreme case to warrant the courts in holding that the constitutional limit has been transcended.” State v. Rodman, 58 Minn. 393, 59 N.W. 1098, 1100 (1894).

The United States Supreme Court extensively explored the Excessive Fines Clause pertaining to a forfeiture in United States v. Bajakajian, 524 U.S. 321, 118 S.Ct. 2028, 141 L.Ed.2d 314 (1998). In Bajakajian, customs officers stopped the defendant as he attempted to leave the United States. The customs officers found $357,144 in currency and confiscated it. Id. at 324, 118 S.Ct. 2028. Bajakajian was charged with one count of violating 18 U.S.C. § 5316(a)(1)(A) (1994), requiring travelers to declare their belongings if they are transporting more than $10,000 from the United States. 524 U.S. at 325, 118 S.Ct. 2028. If a person is in violation of the statute, a court has discretion to order that person to “forfeit to the United States any property, real or personal, involved in such offense * * 18 U.S.C. § 982(a)(1) (1994).

Relying on the Cruel and Unusual Punishments Clause of the Eighth Amendment, the Supreme Court adopted a standard of gross disproportionality articulated in Solem v. Helm, 463 U.S. 277, 288, 103 S.Ct. 3001, 77 L.Ed.2d 637 (1983). Specifically, the Supreme Court held that a fine is unconstitutional if it is grossly disproportional to the gravity of the offense. Bajakajian, 524 U.S. at 344, 118 S.Ct. 2028.

To determine proportionality, the Supreme Court in Solem utilized three factors: 1) the gravity of the offense and the harshness of the penalty; 2) a comparison of the contested fine with fines imposed for the commission of the other crimes in the same jurisdiction; and 3) comparison of the contested fine with fines imposed for commission of the same crime in other jurisdictions. Solem, 463 U.S. at 290-91, 103 S.Ct. 3001. Applying the Solem test to Bajakajian, the Supreme Court held that the forfeiture of Bajakajian’s money would violate the Excessive Fines Clause. Bajakajian, 524 U.S. at 344, 118 S.Ct. 2028.

We first substantially applied the Excessive Fines Clause to Minnesota statutes in Rewitzer, 617 N.W.2d at 412. In Rewitzer, we were asked whether postconviction fines and surcharges totaling $273,600 amounted to an unconstitutionally excessive fine. Similar to the United States Supreme Court in Bajakajian, we adopted the three-part test established in Solem for evaluating the constitutionality of a fine under the Excessive Fines Clause. The fines in Rewitzer were levied against the defendant for selling drugs with a street value of less than $200. Id. at 414 n. 4.

Applying the “gross disproportionality” standard found in Solem and Bajakajian, along with the three-part test articulated in Solem and relied on in Bajakajian, we held that: (1) the punishment was largely disproportional to the crime, as the fine was grossly larger (1,368 times) than the value of the drugs and the severity of the offense; (2) the fines imposed on Rewitzer were substantially higher than the fines authorized for other similarly ranked offenses; and (3) Rewitzer’s fine far exceeded the recommended fine for a similar offense under the Federal Sentencing Guidelines ($273,600 versus $500-$5,000). Rewitzer, 617 N.W.2d at 414-15.

We have previously validated the practice of vehicle forfeitures as long as a sufficient nexus exists between the crime and the vehicle. In Riley v.1987 Station Wagon, 650 N.W.2d 441 (Minn.2002), the district court ordered the forfeiture of a motor vehicle after the owner was convicted of two counts of conspiracy to commit first-degree murder. The court ordered forfeiture on the basis that the vehicle had been used in furtherance of the conspiracy to commit the murder. We held that “in Minnesota, an action for forfeiture is a civil in rem action. The property seized becomes the defendant based on the legal fiction that it is the inanimate object itself, not its possessor or owner, that is guilty of wrongdoing.” Id. at 443 (citations omitted). Because the sole connection between the vehicle and criminal activity in Riley was a remote transportation of the criminal, we held that a sufficient nexus did not exist to warrant a forfeiture. Id. at 445; see Minn.Stat. § 609.531, subd. 6a (2002).

According to Riley, “common sense dictates that the law requires a substantially significant connection with criminal activity before an ordinary automobile may be seized and forfeited to the Government.” Riley, 650 N.W.2d at 445 (citations omitted). In contrast to Riley, the vehicle in the present case was clearly and directly involved with appellant’s drunken driving. The use of a vehicle in a first-degree DWI offense is a necessary prerequisite of the forfeiture statute. The question appellant raises does not revolve around appellant’s guilt, or the vehicle’s nexus to that guilt, but rather the degree that appellant will be harmed by her punishment.

The City first asks us to depart from the Solem test, arguing that in rem vehicle forfeitures should be judged purely based on an “instrumentality” inquiry. We decline to depart from the Solem test in the present matter and therefore apply the three Solem factors to the facts of this case.

The first Solem factor examines the gravity of the offense and the harshness of the penalty. Solem, 463 U.S. at 290, 103 S.Ct. 3001. Appellant argues that a determination of the harshness of the penalty should include an evaluation of the financial condition of the person being subject to forfeiture. To support this theory, appellant cites several forfeiture cases in other jurisdictions that suggest a possible evaluation of an offender’s financial situation.

The district court agreed with appellant’s argument. Under the first Solem factor, the district court found

The vehicle forfeiture statute can produce disparate punishment because it affects individuals differently depending on their financial situations. Thus, on a case-by-case basis, several factors should be considered when determining the harshness of vehicle forfeiture, such as income, financial resources, liabilities, value of the vehicle, and owner equity. Such factors are important because they affect the harshness that results from vehicle forfeiture. For instance, vehicle forfeiture is likely to be harsher upon a low-income person than a wealthy person.

Miller v. One 2001 Pontiac et al., FP-01-9460 (Minn. District Court, Fourth District, March 8, 2002 at 2).

The court of appeals disagreed with the district court. It held:

[T]he district court erred in assessing Miller’s financial situation when applying the first factor of Solem’s test for gross disproportionality. The Supreme Court in Solem clearly articulated that “[wjhen sentences are reviewed under the Eighth Amendment, courts should be guided by objective factors that our eases have recognized.”

Miller, 655 N.W.2d at 16 (quoting Solem, 463 U.S. at 291, 103 S.Ct. 3001).

While the court of appeals was correct in pointing out that Solem does not explicitly call for a personal financial analysis, the first factor does not expressly preclude consideration of a defendant’s financial condition in determining harshness. Without specifically deciding the extent that harshness can be measured by a defendant’s unique financial situation, we conclude on the record before us that the district court abused its discretion in finding that a forfeiture of more than $1,000 was a violation of the United States or Minnesota Constitutions.

The second Solem factor compares the contested fine with fines imposed for the commission of the other crimes in the same jurisdiction. Solem, 463 U.S. at 291, 103 S.Ct. 3001. The court of appeals in this case held that “forfeiture of a $16,000 vehicle is not excessive when compared to the maximum fine for a gross misdemean- or.” Miller, 655 N.W.2d at 17. The district court did not utilize this factor.

In the present case, the value of appellant’s vehicle was not much different than other vehicles, nor is it grossly different than other fines for crimes of a similar serious nature. For example, in addition to DWI convictions, Minnesota allows vehicle forfeiture for violation of Minnesota Department of Natural Resources statutes for the wrongful taking or shining of game or illegally transporting minnows. Minn. Stat. § 97A.225 (2002). The United States Supreme Court has recently emphasized that “legislatures have extremely broad discretion in defining criminal offenses, and in setting the range of permissible punishments for each offense. Judicial decisions that operate within these legislatively enacted guidelines are typically reviewed for abuse of discretion.” Cooper Industries, Inc. v. Leatherman Tool Group, Inc., 532 U.S. 424, 432, 121 S.Ct. 1678, 149 L.Ed.2d 674 (2001) (internal citations omitted). Appellants forfeiture was not disproportionate to other forfeitures in Minnesota and was subjected to heightened protections of a criminal trial.

Finally, the third Solem factor asks for a comparison of the contested fine with fines imposed for commission of the same crime in other jurisdictions. Solem, 463 U.S. at 290-91, 103 S.Ct. 3001. Such a comparison has already been extensively analyzed by the court of appeals which concluded that “many other states, in addition to Minnesota, subject a person’s vehicle to forfeiture when such person has been convicted of several impaired driving offenses.” New Brighton, 622 N.W.2d at 372. Appellant does not dispute this holding, but rather repeats her assertion that we should account for personal financial considerations.

We hold that the forfeiture of appellant’s vehicle was not grossly disproportionate to the gravity of the offense. We further hold that appellant’s forfeiture does not violate the Excessive Fines Clauses of the Minnesota or United States Constitutions and therefore affirm the court of appeals on the grounds stated herein.

Affirmed.

      . With the adoption of the felony DWI, Minn. Stat. § 169A.24 (2002), violations of Minn. Slat. § 169A.25 became titled a “Second Degree DWI," effective August 1, 2002.

      . To support the "instrumentality” argument, the City cites to Justice Antonin Scalia's concurrence in Austin v. United States, 509 U.S. 602, 113 S.Ct. 2801, 125 L.Ed.2d 488 (1993) (Scalia, J. concurring), a case decided prior to Bajakajian. In Justice Scalia's concurrence, he suggested that the sole measure of an in rem forfeiture’s excessiveness should be the "instrumentality” of the property being forfeited. Id. at 625-28, 113 S.Ct. 2801. The United States Supreme Court has never adopted this suggestion. However, in a footnote, the majority in Austin directly responded to Justice Scalia's suggestion by pointing out that “[w]e do not rule out the possibility that the connection between the property and the offense may be relevant, but our decision today in no way limits the Court of Appeals from considering other factors in determining whether the forfeiture of Austin's property was excessive.” Id. at 623 n. 15, 113 S.Ct. 2801. The Supreme Court in Bajakajian refused to address the issue of “instrumentality.” Minnesota state courts have never applied a sole "instrumentality” test, and the Minnesota Court of Appeals has utilized the three-part Solem test regarding an Eighth Amendment evaluation of vehicle forfeitures. See, e.g., City of New Brighton v.2000 Ford Excursion, 622 N.W.2d 364 (Minn.App.2001). We rule out an instrumentality test as the sole determination of excessiveness in an in rem forfeiture. However, an instrumentality, or a "nexus" consideration, may be combined with the Solem test. See Riley, 650 N.W.2d at 445.

      . Appellant asks that this personal financial consideration be utilized as a new fourth factor, in addition to the three Solem test factors. We decline to alter the United States Supreme Court's test in such a manner. Alternatively, appellant asks that we consider personal financial condition within the framework of the first Solem factor.

      . In addition to forfeiture, the current updated statute allows for a sentence of imprisonment of "not more than seven years, or to payment of a fine of not more than $14,000, or both.” Minn.Stat. § 169A.24 (2002).