Chuk Public Utilities Corporation v Billimon [2007] FMCSC 41; 15 FSM Intrm. 290 (Chk. S. Ct. Tr. 2007) (27 September 2007)

CHUUK STATE SUPREME COURT TRIAL DIVISION
CSSC-CA. NO. 226-2002

CHUUK PUBLIC UTILITIES CORPORATION,
Plaintiff,

vs.

OSHIRO BILLIMON, d/b/a CHUUK STAR HOTEL,
and CHUUK STAR HOTEL,
Defendants.
__________________________________________

ORDER DENYING TEMPORARY RESTRAINING ORDER AND SETTING HEARING DATE

Camillo Noket
Chief Justice

Decided: September 27, 2007

APPEARANCES:

For the Plaintiff: Charleston Bravo
Assistant Attorney General
Office of the Chuuk Attorney General
P.O. Box 1050
Weno, Chuuk FM 96942

For the Defendants: Johnny Meippen, Esq.
P.O. Box 705
Weno, Chuuk FM 96942

* * * *

HEADNOTES

Civil Procedure  Injunctions

The issuance of an order for injunctive relief is largely a matter of the facts of each situation and thus a matter for the trial judge's discretion. The object of seeking injunctive relief, including a temporary restraining order, is to preserve the status quo pending the litigation on the merits. Chuuk Public Utilities Corp. v. Billimon, [2007] FMCSC 41; 15 FSM Intrm. 290, 292 (Chk. S. Ct. Tr. 2007).

Civil Procedure  Injunctions

When a final judgment has been entered, temporary injunctive relief comes to an end and is superseded by the final order. Chuuk Public Utilities Corp. v. Billimon, [2007] FMCSC 41; 15 FSM Intrm. 290, 292-93 (Chk. S. Ct. Tr. 2007).

Debtors' and Creditors' Rights  Orders in Aid of Judgment

After obtaining a judgment, the judgment holder is entitled by statute to seek an order in aid of judgment to force payment and determine the best means to effectuate such payment. The purpose of an order in aid of judgment is to provide a means of discovery to inquire into the assets and ability of a judgment debtor to pay a judgment. Chuuk Public Utilities Corp. v. Billimon, [2007] FMCSC 41; 15 FSM Intrm. 290, 293 (Chk. S. Ct. Tr. 2007).

Debtors' and Creditors' Rights  Orders in Aid of Judgment

Once a party has applied for an order in aid of judgment, the court must, after notice to the opposite party, hold a hearing on the question of the debtor's ability to pay and determine the fastest manner in which the debtor can reasonably pay a judgment based on the finding. Chuuk Public Utilities Corp. v. Billimon, [2007] FMCSC 41; 15 FSM Intrm. 290, 293 (Chk. S. Ct. Tr. 2007).

Civil Procedure  Injunctions; Debtors' and Creditors' Rights  Orders in Aid of Judgment

A plaintiff's motion for a temporary restraining order filed after judgment had already been entered against the defendant and after the plaintiff had already requested an order in aid of judgment will be denied since the plaintiff has an available remedy in its motion for an order in aid of judgment and since it seeks to restrain funds in the hands of a third party without a specific determination as to the defendant's right to any part of those funds. Chuuk Public Utilities Corp. v. Billimon, [2007] FMCSC 41; 15 FSM Intrm. 290, 293 (Chk. S. Ct. Tr. 2007).

* * * *

COURT'S OPINION

CAMILLO NOKET, Chief Justice:

On September 19, 2007 the Court heard oral argument from counsel for Plaintiff Chuuk Public Utilities Corporation ("CPUC") on its motion for temporary restraining order. No appearance was made by or on behalf of Defendants Oshiro Billimon, d/b/a Chuuk Star Hotel, and Chuuk Star Hotel (collectively, "Billimon"). The Court took the motion under advisement. The court now denies the motion and sets the hearing date for CPUC's pending motion for an order in aid of judgment.

Procedural Background

1. On November 27, 2002 CPUC filed its complaint against Billimon seeking damages for non-payment of electrical bills.
   
2. On January 8, 2003, the clerk of court entered a default against Billimon and on January 21, 2003 entered a default judgment against him in the amount of $148,221.00.
   
3. On August 19, 2003, CPUC filed its motion for an order in aid of judgment. The court's file does not reflect service of the motion.[1]
   
4. On October 31, 2006, CPUC filed and served a motion to withdraw its August 19, 2003 motion for an order in aid of judgment and a new motion for an order in aid of judgment.
   
5. On January 12, 2007, CPUC filed and served its motion for a temporary restraining order.
   
6. On January 16, 2007 Billimon filed and served his response opposing CPUC's motion for a temporary restraining order.
   
7. As of the date of the hearing on CPUC's motion for a temporary restraining order, CPUC's October 31, 2006 motion for an order in aid of judgment was pending.
   

Plaintiff's Motion for a Temporary Restraining Order

In its motion, CPUC asserts that a temporary restraining order is necessary to preserve the status quo so that funds owing to Billimon by non-parties, Midasy Aisek and his family, for the purchase of the Chuuk Star Hotel, are not disbursed. It is unclear from the motion whether CPUC has a right to the specific funds from the sale that is superior to other possible lien holders. At the hearing on the motion, CPUC was unable to provide any evidence of the amounts remaining owing to Billimon as a result of his sale of the Chuuk Star Hotel.[2]
Law

I. The Object of a Temporary Restraining Order is to Preserve the Status Quo Pending Litigation on the Merits.

The issuance of an order for injunctive relief is largely a matter of the facts of each situation and thus a matter for the discretion of the trial judge. Onopwi v. Aizawa, [1994] FMCSC 9; 6 FSM Intrm. 537 (Chk. S. Ct. App. 1994). The object of seeking injunctive relief, including temporary restraining order, is to preserve the status quo pending the litigation on the merits. Seventh Kosrae State Legislature v. Sigrah, [2002] FMKSC 16; 11 FSM Intrm. 110, 113 (Kos. S. Ct. Tr. 2002); Ponape Transfer & Storage v. Pohnpei State Public Lands Auth., [1986] FMSC 21; 2 FSM Intrm. 272, 275 (Pon. 1986). When a final judgment has been entered, temporary injunctive relief comes to an end and is superseded by the final order. Damarlane v. United States, [1997] FMSC 33; 8 FSM Intrm. 45, 54 (App. 1997). A court may not grant a request for injunctive relief without a showing that there is no adequate remedy at law. Hartman v. Chuuk, [1998] FMCSC 20; 8 FSM Intrm. 580, 581 (Chk. S. Ct. Tr. 1998).

II. An Order in Aid of Judgment Provides a Judgment Holder a Means to Force Payment and Determine the Ability to Pay of the Judgment Debtor.

After obtaining a judgment, the judgment holder is entitled by statute to seek an order in aid of judgment to force payment and determine the best means to effectuate such payment. See Kama v. Chuuk, [1999] FMCSC 15; 9 FSM Intrm. 496, 498 (Chk. S. Ct. Tr. 1999) (The purpose of statutes authorizing orders in aid of judgment is to force the payment of a judgment and to provide means to collect a money judgment.).[3] The purpose of an order in aid of judgment is to provide a means of discovery to inquire into the assets and ability of a judgment debtor to pay a judgment. Id.

The Chuuk Rules of Civil Procedure, Rule 69(a) provides the procedure for seeking an order in aid of judgment, including seeking discovery on the debtor's ability to pay. See Chk. Civ. R. 69(a) ("In aid of the judgment or execution, the judgment creditor . . . may obtain diry from any any person, including the judgment debtor . . .㼠"ce a ce a party hrty has applied for an order in f jud, the court must, after notice to the opposite party, hold a hearing on the questquestion oion of the debtor's ability to pay and dete theest manner in whin which thch the debtor can reasonably pay a judgment based on the finding. Walter v. Chuuk, [2001] FMSC 20; 10 FSM Intrm. 312, 316-17 (Chk. 2001).

Application of Law to Facts

CPUC filed its motion for a temporary restraining order after judgment had already been entered against Billimon and after it had already requested an order in aid of judgment. Thus, CPUC has the available remedy of an order in aid of judgment. For the court to grant CPUC's motion for a temporary restraining order, CPUC must have no other available remedy. See Hartman, 8 FSM Intrm. at 581. An additional obstacle to granting CPUC's motion for a temporary restraining order is that it seeks to restrain funds in the hands of a third party, Midasy Aisek and his family, without a specific determination as to Billimon's right to any part of those funds. The determination of Billimon's ability to pay CPUC's judgment against him, including the amounts that Billimon is entitled to from the sale of the Chuuk Star Hotel, along with the priority of Billimon's creditors, may be determined at a hearing on CPUC's motion for an order in aid of judgment. The court therefore finds that CPUC's pending motion for order in aid of judgment is an available, appropriate means for it to seek payment of the judgment it has obtained against Billimon.

Conclusion

Accordingly, the court denies CPUC's motion for temporary restraining order.

The court further orders that a hearing on CPUC's motion for an order in aid of judgment is set for October 3, 2007 at 10:30 a.m.

---

^[1]Speculation in the motion that Billimon was on the verge of receiving funds for the sale of the Chuuk Star Hotel to the College of Micronesia turned out to be wrong and may explain why counsel for CPUC apparently did not serve or seek a hearing on the motion.
^[2]In his response to CPUC’s motion for a temporary restraining order, Billimon asserted that a separate proceeding was filed in the FSM Supreme Court (Civil Action No. 2003-1026) to determine the priority of lien holders against Billimon for the proceeds of the sale of the Chuuk Star Hotel, and that CPUC, as a named party in that case, failed to assert any claim it had on those funds, which were disposed of according to terms and conditions of the settlement in that lawsuit. Counsel for Billimon was not present for the hearing and counsel for CPUC did not specifically address the argument made by Billimon in his response.
^[3]The authority for an application of an Order in Aid of Judgment is found in 8 TTC 55. Upon such an application, the court may order a just method of payment after an evidentiary hearing pursuant to 8 TTC 56 which provides in part: "Upon having heard the evidence . . . the court shall make such order in aid of judgment as is just for the payment of any judgment based on the finding." Additional force is provided in 8 TTC 58, which allows the court to order a debtor to jail for six months for contempt in the event the debtor fails to comply with the order in aid of judgment.