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Mitchell v. W.T. Grant Co.

Supreme Court of the United States · 1974 · Civil Procedure

Civil ProcedureDue ProcessPrejudgment SeizureSequestrationFourteenth Amendmentprocedural due processex parte seizureprejudgment remedy

Facts

Grant sold Mitchell household goods on installment and alleged that Mitchell owed an overdue balance of $574.17. Grant sued for the debt and sought sequestration of the goods to enforce its vendor's lien, filing a verified petition and affidavit stating specific facts and asserting reason to believe Mitchell would encumber, alienate, or dispose of the goods during the litigation. A judge in Orleans Parish authorized the writ ex parte after requiring Grant to post a $1,125 bond, and the goods were seized. Mitchell later moved to dissolve the writ, arguing the seizure violated due process because it occurred without prior notice or hearing, but the motion was denied.

Issue

Does the Due Process Clause of the Fourteenth Amendment forbid Louisiana from ordering ex parte sequestration of installment-sale goods subject to a vendor's lien, without prior notice or hearing, when the statute provides for judicial authorization, specific factual showings, creditor bond, immediate post-seizure challenge, and debtor repossession by bond?

Rule

Due process does not invariably require notice and a hearing before temporary deprivation of possession of property. A prejudgment sequestration procedure is constitutional when, viewed as a whole, it reasonably accommodates the conflicting interests of debtor and creditor by requiring a verified showing of specific facts, judicial authorization, creditor security against wrongful seizure, a prompt post-seizure hearing at which the creditor must prove the grounds for the writ, and an opportunity for the debtor to regain possession by posting bond.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In Birmingham, Lena Ortiz bought a commercial freezer from Riverbend Home Supply on installments. After she missed several payments, Riverbend sought an ex parte writ to sequester the freezer under an Alabama statute that requires a verified petition with specific facts, approval by a judge, a creditor bond, an immediate post-seizure dissolution hearing, and the debtor's right to regain possession by posting bond. Riverbend holds a contractual lien on the freezer securing the unpaid price.

If Lena argues that due process always required notice and a hearing before the freezer was seized, what is the best response?

Explanation. The majority held that due process does not invariably require notice and hearing before a temporary deprivation of possession. A key feature was that the creditor had a current, real interest in the property itself through a lien securing the unpaid purchase price, rather than being a general unsecured creditor. Combined with specific sworn facts, judicial authorization, creditor bond, prompt post-seizure hearing, and debtor replevy by bond, the procedure constitutionally accommodates both parties' interests.