Facts

On Sept. 5, 2001, plaintiff Francisco Javier Rivera Agredano, 42, owner of a printing business, purchased a seized, 1987 Nissan Pathfinder "as is" at an auction by U.S. Customs, near San Diego.

The plaintiff is a Mexican resident who resides in Tijuana. On Jan. 24, 2002, at approximately 11 p.m., the plaintiff and Alfonso Calderon, his brother-in-law and business partner, were driving the Pathfinder from Ensenada to Tijuana. They had traveled to Ensenada on a business trip, and had 5,000 posters for a client in the Pathfinder during the trip back to Tijuana.

The plaintiff and Calderon were stopped at a mandatory checkpoint in Sauzal. Soldiers at the checkpoint found 17 kilograms of marijuana in packages hidden in the upholstery, in the doors, and in the sides of the vehicles. During the search, the soldiers destroyed the interior of the vehicle.

The plaintiff and Calderon were restrained by the soldiers, who pointed guns at their heads, handcuffed them, and arrested them. The plaintiff was jailed for 20 or 30 days in a small, 11-person cell in which he was unable to lie down to sleep and the only bathroom was a hole in the cell. He was provided coffee and water three times per day, and fed beans, rice, and soup.

The plaintiff was then transferred to a cell containing 45 or 50 other inmates, where he remained jailed for 11 months. He slept on the floor in the cell and remained sedentary throughout the day with no opportunity to exercise. The toilet in the cell did not flush, and hot water was available for showering at only three or five o'clock in the morning.
The plaintiff was charged with drug trafficking and possession of drugs. On June 25, 2002, he was found guilty and sentenced to five years in prison.
On Jan. 10, 2003, the plaintiff and Calderon were released from prison, after a successful appeal.

The plaintiff and Calderon sued the United States in the U.S. District Court for the Southern District of California, alleging violation of the Federal Tort Claims Act. The District Court found that their claims were barred under the Federal Tort Claims Act because they were arrested in Mexico. They then amended their complaint and the case was transferred to the United States Court of Federal Claims, where they alleged breach of warranty, breach of contract, and breach of the covenant of good faith and fair dealing.

After the defendant's motion for summary judgment, the Court found that Calderon was not a third-party beneficiary of the contract to purchase the Pathfinder, and his claim was dismissed.

The plaintiff alleged that there was an implied-in-fact warranty that the Pathfinder had no contraband in it when it was sold. He also alleged that the U.S. violated the doctrine of superior knowledge and breached the contract by failing to inform him of a rumored policy in Customs to minimize damage during searches to preserve resale value. He further alleged that the U.S. breached the covenant of good faith and fair dealing by failing to adequately search the Pathfinder because it wanted to minimize damage and preserve the resale value of the vehicle.

The defense argued that plaintiff did not prove the existence of an implied-in-fact warranty, and that the doctrine of superior knowledge was inapplicable to this case.

Settlement Discussions

The plaintiff demanded $1 million. The defendant made no offer.

Damages

The plaintiff sought $2,600 for the fair market value of the Pathfinder; $350,000 for attorney's fees during criminal proceedings in Mexico; $1,254 for expenses incurred by his family while taking supplies to him during his imprisonment; $48,000 for lost income during his imprisonment; $10,000 for his past medical expenses; $80,000 for his future medical expenses; $12,500 for his past psychiatric bills; $33,000 to $60,000 for his future psychiatric expenses; and an unspecified amount for his emotional distress. The defense argued that his damages were not recoverable and not foreseeable.

Injuries

The plaintiff claimed that he sustained nervousness, depression, insomnia, diarrhea, skin ailments, and obesity while imprisoned, and that he developed diabetes caused by his weight gain in prison. His psychiatrist and two treating physicians testified that he had suicidal thoughts, vascular insufficiency, skin disorders, infections and post-traumatic stress disorder. He continues to experience these health problems and claimed a need for future treatment.

Result

The court entered a $550,854 judgment for plaintiff, finding that the United States breached the contract and violated the implied-in-fact warranty. The court also found that the doctrine of superior knowledge was inapplicable and that there was no violation of the covenant of good faith and fair dealing because the plaintiff failed to prove the existence of the alleged policy to obtain a higher resale value. The award consisted of compensatory damages under the contractual claims only; there was no award for emotional distress.

Other Information

The defendant appealed the judgment. The plaintiff also appealed the judgment as to the dismissal of the tort claims and the failure to award compensation for emotional distress damages. A request for attorney fees and costs to plaintiff in the amount of $211,616 pending (filed under the Equal Access to Justice Act). Since an appeal was filed, no decision on the attorney fee application has been made yet. A petition for a Congressional Reference was introduced by Rep. Bob Filner on behalf of Francisco Rivera and Alfonso Calderon [under 28 USC 1492 and 2509]. House Resolution 798 (H. Res. 798) was for the relief of Francisco Rivera and Alfonso Calderon, House Resolution 797 (H. Res. 797) was for the relief of Adrian Rodriguez (a citizen of the USA who had a similar problem with a seizure vehicle). The bills expired at the end of the last session but can be renewed by Rep. Filner this session should he choose to do so.