Agency Investigations. A state statute required vehicle dismantlers—persons whose business includes dismantling automobiles and selling the parts—to be licensed and to keep records regarding the vehicles and parts in their possession. The statute

Question

also authorized war-rantless administrative inspections; that is, without first obtaining a warrant, agents of the state department of motor vehicles or police officers could inspect a vehicle dismantler's license and records, as well as vehicles on the premises. Pursuant to this statute, police officers entered an automobile junkyard and asked to see the owner's license and records. The owner replied that he did not have the documents. The officers inspected the premises and discovered stolen ve-hicles and parts. Charged with possession of stolen property and unregistered operation as a vehicle dismantler, the junkyard owner argued that the warrantless inspection statute was un-constitutional under the Fourth Amendment. The trial court disagreed, reasoning that the junk-yard business was a highly regulated industry. On appeal, the highest state court concluded that the statute had no true administrative purpose and impermissibly authorized searches whose only purpose was to discover stolen property. The state appealed to the United States Supreme Court. Should the Court uphold the statute? Discuss.

Answer 1

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The United States Supreme Court held that searches made under the statute fell within the exception to the warrant requirement for administrative searches of highly regulated businesses. The Court reasoned that (1) because of the increase in motor vehicle theft and the association of theft with the dismantling industry, the state has a substantial interest in regulating the industry; (2) warrantless inspections are necessary to further the regulatory scheme; and (3) the statute provides a constitutionally adequate substitute for a warrant, because it informs a business operator that regular inspections will be made, how to comply with the statute, and who can make the inspections.