39-12-207 - RICO lien notice Liens Title or interest holders Unauthorized conveyances. - Tennessee Statutes

39-12-207. RICO lien notice Liens Title or interest holders Unauthorized conveyances.

(a)  Upon the institution of any civil or criminal proceeding, the investigative agency, then or at any time during the pendency of the proceeding, may file a RICO lien notice in the official records of any one (1) or more counties. No filing fee or other charge is required as a condition for filing the RICO lien notice, and the clerk of the court shall, upon the presentation of a RICO lien notice, immediately record it in the official records.

(b)  The RICO lien notice shall be signed by the attorney general and reporter or the attorney general and reporter's designee. The notice shall be in such form as the attorney general and reporter prescribes and shall set forth the following information:

     (1)  The name of the person against whom the civil or criminal proceeding has been brought. In its discretion, the investigative agency may also name in the RICO lien notice any other aliases, names, or fictitious names under which the person may be known and any corporation, partnership, or other entity that is either controlled or entirely owned by the person;

     (2)  If known to the investigative agency, the present residence and business addresses of the person named in the RICO lien notice and of other names set forth in the RICO lien notice;

     (3)  A reference to the civil or criminal proceeding, stating:

          (A)  That a proceeding under this part has been brought against the person named in the RICO lien notice;

          (B)  The name of the county or counties in which the proceeding has been brought; and

          (C)  If known to the investigative agency at the time of filing the RICO lien notice, the case number of the proceeding;

     (4)  A statement that the notice is being filed pursuant to this part; and

     (5)  (A)  The name and address of the investigative agency filing the RICO lien notice and the name of the individual signing the RICO lien notice.

          (B)  A RICO lien notice shall apply only to one (1) person and, to the extent applicable, any other aliases, names or fictitious names, including names of corporations, partnerships, or other entities, to the extent permitted in subdivision (b)(1).

          (C)  A separate RICO lien notice shall be filed for each person against whom the investigative agency desires to file a RICO lien notice under this section.

(c)  The investigative agency shall, as soon as practicable after the filing of each RICO lien notice, furnish to the person named in the notice either a copy of the recorded notice or a copy of the notice with a notation on the notice of the county or counties in which the notice has been recorded. The failure of the investigative agency to furnish a copy of the notice under this subsection (c) shall not invalidate or otherwise affect the notice.

(d)  (1)  The filing of a RICO lien notice creates, from the time of its filing, a lien in favor of the state on the following property of the person named in the notice and against any other names set forth in the notice:

          (A)  Any real or personal property situated in the county where the notice is filed then or thereafter owned by the person or under any of the names; and

          (B)  Any beneficial interest in real or personal property situated in the county where the notice is filed then or thereafter owned by the person or under any of the names.

     (2)  The lien shall commence and attach as of the time of filing of the RICO lien notice and shall continue until expiration, termination, or release of the notice pursuant to § 39-12-208. The lien created in favor of the state shall be superior and prior to the interest of any other person in the real or personal property or beneficial interest, if the interest is acquired subsequent to the filing of the notice.

(e)  In conjunction with any civil proceeding:

     (1)  The investigative agency may file a lis pendens in any county without prior court order; in such case, any person acquiring an interest in the subject real property or beneficial interest, if the real property or beneficial interest is acquired subsequent to the filing of lis pendens, shall take the interest subject to the civil proceeding and any subsequent judgment of forfeiture; and

     (2)  If a RICO lien notice has been filed, the investigative agency may name as defendant, in addition to the person named in the notice, any person acquiring an interest in the real or personal property or beneficial interest subsequent to the filing of the notice. If a judgment of forfeiture is entered in the proceeding in favor of the state, the interest of any person in the property that was acquired subsequent to the filing of the notice shall be subject to the notice and judgment of forfeiture.

(f)  (1)  A trustee who acquires actual knowledge that a RICO lien notice or a civil proceeding or criminal proceeding has been filed against any person for whom the trustee holds legal or record title to real or personal property shall immediately furnish to the investigative agency the following:

          (A)  The name and address of the person, as known to the trustee;

          (B)  The name and address, as known to the trustee, of each other person for whose benefit the trustee holds title to the real or personal property; and

          (C)  If requested by the investigative agency, a copy of the trust agreement or other instrument pursuant to which the trustee holds legal or record title to the real or personal property.

     (2)  Any trustee who fails to comply with the provisions of this subsection (f) commits a Class A misdemeanor.

(g)  (1)  Any trustee who conveys title to real or personal property for which, at the time of the conveyance, a RICO lien notice naming a person who, to the actual knowledge of the trustee, holds a beneficial interest in the trust has been filed in the county where the real or personal property is situated is liable to the state for the greatest of:

          (A)  The amount of proceeds received directly by the person named in the RICO lien notice;

          (B)  The amount of proceeds received by the trustee as a result of the conveyance and distributed to the person named in the RICO lien notice; or

          (C)  The fair market value of the interest of the person named in the RICO lien notice in the real or personal property so conveyed.

     (2)  However, if the trustee conveys the real or personal property and holds the proceeds that would otherwise be paid or distributed to the beneficiary or at the direction of the beneficiary or the beneficiary's designee, the trustee's liability shall not exceed the amount of the proceeds so held for so long as the proceeds are held by the trustee.

(h)  The filing of a RICO lien notice shall not constitute a lien on the record title to real or personal property as owned by the trustee, except to the extent that the trustee is named in the RICO lien notice. The investigative agency may bring a civil proceeding in any circuit or chancery court against the trustee to recover from the trustee the amount set forth in subsection (g), and the state shall also be entitled to recover investigative costs and attorney's fees incurred by the investigative agency.

(i)  The filing of a RICO lien notice shall not affect the use to which real or personal property or a beneficial interest owned by the person named in the RICO lien notice may be put, or the right of the person to receive any rents, or other proceeds resulting from the use and ownership, but not the sale, of the property, until a judgment of forfeiture is entered.

(j)  (1)  The provisions of this section shall not apply to any conveyance by a trustee pursuant to a court order, unless such court order is entered in an action between the trustee and beneficiary.

     (2)  Unless the trustee has actual knowledge that a person owning a beneficial interest in the trust is named in a RICO lien notice or is otherwise a defendant in a civil proceeding, the provisions of this section shall not apply to:

          (A)  Any conveyance by the trustee required under the terms of the trust agreement, which trust agreement is a matter of public record prior to the filing of the RICO lien notice; or

          (B)  Any conveyance by the trustee to all of the persons who own beneficial interests in the trust.

(k)  Upon the entry of a final judgment of forfeiture in favor of the state of Tennessee, the title of the state to the forfeited property shall:

     (1)  In the case of real property, or a beneficial interest in the real property, relate back to the date of filing of the RICO lien notice in the official records of the county where the real property or a beneficial interest in the real property is located; and if no RICO lien notice is filed, then to the date of the filing of any notice of lis pendens under subsection (e) in the official records of the county where the real property or a beneficial interest in it is located; and if no RICO lien notice or notice of lis pendens is filed, then to the date of the recording of the final judgment of forfeiture in the official records of the county where the real property or a beneficial interest in the real property is located; and

     (2)  In the case of personal property, or a beneficial interest in it, relate back to the date the personal property or the beneficial interest in it was seized by the state, or the date of filing of the RICO lien notice in the official records of the county where the personal property or a beneficial interest in the personal property is located; but if the property was not seized and no RICO lien notice was filed, then to the date of the recording of the final judgment of forfeiture in the official records of the county where the personal property, or a beneficial interest in the personal property, is located.

(l)  If real or personal property, or a beneficial interest in the real or personal property, subject to forfeiture is conveyed, alienated, disposed of, or otherwise rendered unavailable for forfeiture after the filing of the RICO lien notice, or after the filing of a civil proceeding or criminal proceeding, whichever is earlier, the attorney general and reporter may institute an action in any circuit or chancery court against the person named in the RICO lien notice or the defendant in the civil proceeding or criminal proceeding; and the court shall enter final judgment against the person named in the RICO lien notice or the defendant in the civil proceeding or criminal proceeding in an amount equal to the fair market value of the property or any beneficial interest in the real or personal property, together with investigative costs and attorney's fees incurred by the investigative agency in the action. If a civil proceeding is pending, such action shall be filed only in the court where such civil proceeding is pending.

(m)  If real or personal property, or a beneficial interest in the real or personal property, subject to forfeiture is conveyed, alienated, or otherwise disposed of after the filing of the RICO lien notice, or after the filing of a civil proceeding or criminal proceeding, whichever is earlier, the state may treat the disposal as a fraudulent and preferential conveyance.

(n)  Notwithstanding any other provision of this section, any person who has perfected a security interest in real or personal property, or a beneficial interest in it, for the payment of an enforceable debt or other similar obligation prior to the filing of a RICO lien notice or a lis pendens in reference to the property or interest may foreclose the interest as otherwise provided by law. The foreclosure of the interest shall, insofar as it is practicable, be made in such a fashion that it will not otherwise interfere with a forfeiture under this part.

[Acts 1989, ch. 591, § 1.]