AGO Opinion 98004
Disposing of Unclaimed Motor Vehicles and Recovering the Costs Associated with the Nebraska State Patrol's Seizure and Storage of Motor Vehicles.
DATE: January 15, 1998
SUBJECT: Disposing of Unclaimed Motor Vehicles and Recovering the Costs Associated with the Nebraska State Patrol's Seizure and Storage of Motor Vehicles.
REQUESTED BY: Ron Tussing, Colonel Superintendent Nebraska State Patrol
WRITTEN BY: Don Stenberg, Attorney General
Paul N. Potadle, Assistant Attorney General
QUESTION 1: Is a motor vehicle "property" as contemplated by
Neb. Rev. Stat. § 29-820(c) (1995) that it may be
disposed of pursuant to that section?
ANSWER 1: The term property as used in sections 29-812 to 29-
821 is defined as "tangible objects" which includes
QUESTION 2: For the provisions of Neb. Rev. Stat. § 29-820
(1995) to apply to a motor vehicle, must the
seizure have been motivated solely by specific
evidentiary purposes or is it sufficient that the
motor vehicle was seized and is not required as
ANSWER 2: Under Neb. Rev. Stat. § 29-818 (1995), an officer
may seize property and hold it in custody "so long
as is necessary for the purpose of being produced
as evidence on any trial."
QUESTION 3: Does the "net proceeds" language of Neb. Rev. Stat.
§ 29-820(c) (1995) and Article VII, Section 7,
Constitution of Nebraska, authorize the use of
proceeds to pay costs of seizure, storage and sale
of the vehicle with the balance to be paid to the
school perpetual fund?
ANSWER 3: When used in other statutes, the Nebraska Supreme
Court has defined the term "net proceeds" as gross
proceeds minus reasonable and necessary expenses
incurred. The costs of seizure, storage and sale
of the vehicle are likely to be considered
QUESTION 4: Is an affidavit establishing a motor vehicle as
property described in Neb. Rev. Stat. § 29-820(c)
(1995) "evidence sufficient" to permit the
Department of Motor Vehicles to issue or to
authorize a title to such motor vehicles pursuant
to Neb. Rev. Stat. § 60-111 (1993)?
ANSWER 4: Under Neb. Rev. Stat. § 60-111 (1993), an applicant
for a new certificate of title must set forth facts
entitling him or her to possession and ownership;
not evidence that the vehicle is property.
A motor vehicle is considered property under section 29-
820(c). According to section 29-817, "[t]he term `property' [as]
used in sections 29-812 to 29-821 [includes] documents, books,
papers, and any other tangible objects." Motor vehicles are
clearly tangible objects. Further, in Nash v. City of North
Platte, 205 Neb. 480, 288 N.W.2d 51 (1980), the Nebraska Supreme
Court addressed the issue of tort liability under section 29-818
for damages sustained to a seized vehicle while in an officer's
custody. Although the Court never dealt with the issue directly,
a motor vehicle was treated as "property" for the purposes of
sections 29-818 to 29-821.
The disposition of property under section 29-820 appears to
apply only to property seized for the purpose of being used as
evidence. Section 29-820 itself is premised, ". . . when property
seized is no longer required as evidence, it shall be disposed of.
. . ." Additionally, other sections in this act contain the same
implicit assumption. For example, section 29-818 provides that
seized property can only be held in custody "so long as necessary
for the purpose of being produced as evidence on any trial."
Similarly, the following section, 29-819, provides that, "[w]here
property is no longer required as evidence . . ." it may be
transferred to another jurisdiction. Thus, to the extent that
seized property under this section can be disposed of only when it
is no longer required as evidence, the initial motivation for
seizure must have been for evidentiary purposes. Further, the
disposition of property seized for non-evidentiary reasons, such as
abandoned property, is dealt with in a different manner under Neb.
Rev. Stat. § 60-1905 (1993). Thus, section 29-820 appears to refer
only to the disposition of property initially seized as evidence.
There is no Nebraska caselaw that defines the term "net
proceeds" for the purposes of Article VII, section 7 of the
Nebraska State Constitution. However, Black's Law Dictionary
defines net proceeds as "[g]ross proceeds, less charges which may
be rightly deducted." (6th ed. 1990). This definition is
consistent with caselaw dealing with net proceeds in various
contexts, see, e.g., Parker v. Parker, 1 Neb. App. 187, 492 N.W.2d
50 (1992) ("auction dealt with net proceeds after expenses of
$42,541.06.") and McGowan v. Nebraska State Bank, 229 Neb. 471, 427
N.W.2d 772 (1988) (". . . for a total sales price of $28,956.01,
with net proceeds of $27,872.29 after expenses"). In an
unpublished opinion, the Nebraska Court of Appeals defined net
proceeds as "gross proceeds minus the cost of sale." Peterson v.
Peterson, (1995 WL 454723). In State v. City Betterment Corp., 197
Neb. 575, 250 N.W.2d 601 (1977), the Nebraska Supreme Court stated
The term "proceeds" has been used in all kinds of
contexts and in various situations has been interpreted
as net or gross, depending upon the circumstances. The
words and terms of a constitutional provision are to be
interpreted and understood in their most natural and
obvious meaning. . . The word "proceeds" in Article III,
section 24, Constitution of Nebraska, and in section 28-
964.03, R.R.S. 1943, means "net proceeds." Reasonable
and necessary expenses incident to the organization and
operation of a lottery may be paid from lottery proceeds.
Id. at 582-583. Thus, "net proceeds" when construed in its
ordinary meaning, refers to gross proceeds of a sale less any
reasonable and necessary expenses.
The relevant caselaw fails to indicate what constitutes
"reasonable and necessary expenses." However, Neb. Rev. Stat. §60-
111 (1993) refers to the sale of a vehicle to satisfy storage or
repair charges, and section 60-2019 provides for the proceeds from
the sale of an abandoned vehicle "less any expenses incurred by the
local authority. . . ." Thus, it appears that the net proceeds
language of Article VII, section 7 refers to the proceeds of the
sale of seized property, minus the reasonable and necessary costs
of the initial seizure, storage and eventual sale of the property.
Section 60-111 provides, in relevant part, that,
Only an affidavit by the person or agent of the person to
whom possession of such motor vehicle has so passed,
setting forth facts entitling him or her to such
possession and ownership, together with a copy of the
journal entry, court order, or instrument upon which such
claim of possession and ownership is founded shall be
considered satisfactory proof of ownership and right of
possession, except if the applicant cannot produce such
proof of ownership, he or she may submit to the
department such evidence as he or she may have, and the
department may thereupon, if it finds the evidence
sufficient, issue the certificate of title or authorize
the county clerk to issue a certificate of title as the
case may be.
Neb. Rev. Stat. § 60-111 (1995). Thus, a new certificate of title
will be issued if the applicant submits an affidavit setting forth
facts entitling the applicant to possession, such as a failure of
the true owner to claim the vehicle. With the affidavit, the
applicant must also include a copy of the court order, journal
entry or other instrument upon which ownership is based. If the
applicant does not have a court order or journal entry, the
applicant can submit whatever evidence he or she does have. It is
then left to the discretion of the Department of Motor Vehicles to
decide whether the evidence submitted is sufficient to issue a new
There is no Nebraska caselaw on what constitutes sufficient
evidence of ownership when a certificate of title cannot be
produced. However, if an owner of the vehicle is unknown, it seems
logical that the applicant would have to set forth facts indicating
that he or she made a reasonable effort to find the owner of the
vehicle. If the owner is known but fails to claim the vehicle, an
affidavit should set forth facts indicating that the Patrol made
reasonable efforts to notify the owner over a period of time and
that the owner refused to claim the vehicle.
A motor vehicle is considered "property" for the purposes of
Neb. Rev. Stat. § 29-820(c) (1995). For the provisions of Neb.
Rev. Stat. § 29-820 to apply to a motor vehicle, the initial
seizure must have been motivated by evidentiary purposes. The "net
proceeds" language of Neb. Rev. Stat. § 29-820(c) and Article VII,
Section 7, Constitution of Nebraska, likely authorizes the use of
proceeds to pay costs of seizure, storage and sale of the vehicle
with the balance to be paid to the school perpetual fund. An
affidavit setting forth facts entitling the State Patrol to
possession of a motor vehicle, together with a copy of the journal
entry, court order or other instrument upon which ownership is
based should be considered sufficient evidence to permit the
issuance of a new certificate of title by the Department of Motor
Vehicles or the County Clerk to issue a new title under Neb. Rev.
Stat. § 60-111 (1993).
Paul N. Potadle
Assistant Attorney General