Neimes v Maeda Construction Company [1982] FMSC 1; 1 FSM Intrm. 047 (Truk 1982) (7 January 1982)

THE SUPREME COURT OF THE
FEDERATED STATES OF MICRONESIA

Cite as Neimes v. Maeda Construction Co, 1 FSM Intrm. 47 (Truk 1982)

[1 FSM Intrm. 47]

TRUK STATE TRIAL DIVISION

NEIMES, individually and as
member of her lineage of the
Sor Clan of Wichap Village
Moen, Truk,
Plaintiff,

vs.

MAEDA CONSTRUCTION COMPANY
AND TRUST TERRITORY OF THE
PACIFIC ISLANDS,
Defendants.

CA/NO. 1981-1018

MEMORANDUM OF DECISION

This matter came before the court on December 12, 1981 on the plaintiff's motion for a preliminary injunction. The plaintiff was present in person and by counsel. The defendants appeared by counsel.

The plaintiff's motion for leave to file and serve an amended complaint was granted.

The court raised the question of its jurisdiction and counsel submitted written and oral argument.

The burden is always upon the one who seeks the exercise of the power of the court in his behalf to establish that the court does have jurisdiction. McNutt v. General Motors Acceptance Corp. of Indiana, Inc., [1936] USSC 98; 298 U.S. 178, 189[1936] USSC 98; , 56 S. Ct. 780, 785[1936] USSC 98; , 80 L. Ed. 1135, 1141 (1935).

[1 FSM Intrm. 48]

The plaintiff's first contention is that the case arises under the Constitution in that it is alleged that the plaintiff has been deprived of her property without due process of law. FSM Const. art. IV, § 3.

The applicable portion of the Constitution says, "The national courts, including the trial division of the Supreme Court, have concurrent original jurisdiction in cases arising under this Constitution;. . . ." FSM Const. art. XI, § 6(b).

". . . It is the settled interpretation of these words ['arising under the Constitution or laws of the United States'], as used in this statute, conferring jurisdiction, that a suit arises under the Constitution and laws of the United States only when the plaintiff's statement of his own cause of action shows that it is based upon those laws or that Constitution." Louisville & Nashville Railroad Company v. Mottley, [1908] USSC 148; 211 U.S. 149, 152[1908] USSC 148; , 29 S. Ct. 42, 53
L. Ed. 126, 127 (1908).

The often-cited Mottley case involved specific performance of a contract of railroad passes, in which it was alleged that prohibition thereof would constitute a deprivation of property without due process of law. The court held that the case did not arise under the Constitution.

In the case before the court, the issue is the validity of a grant of easement.

[1 FSM Intrm. 49]

The court concludes that it does not have jurisdiction based on the due process right guaranteed by the Constitution.

The plaintiff next relies on the diversity of citizenship provision in the Constitution to warrant the court taking jurisdiction. The pertinent part of Article XI, Section 6(b) reads, "The national courts, including the trial division of the Supreme Court, have concurrent original jurisdiction . . . in disputes between a state or a citizen thereof, and a foreign state, citizen, or subject."

It was not disputed that Maeda is a foreign corporation and diverse in citizenship from the plaintiff.

To establish diversity of both defendants from the plaintiff the plaintiff's position is that the Trust Territory is a foreign state. Conceding that a number of cases are to the contrary [e.g., Sablan Construction Co. v. Government of the Trust Territory of the Pacific Islands, 526 F. Supp. 135, 137-38 (D. N. Mar. I. App. Div. 1981)], the plaintiff contends that transition to self-government has progressed so far that the earlier holdings no longer
have a rational basis.

The supervision of the Trust Territory over the islands of the Federated States of Micronesia is still significant. Two areas alone indicate this. All public laws enacted by the Congress of the Federated States of Micronesia and approved by the President must be submitted to the High Commissioner of the Trust Territory within 10 days of approval.

[1 FSM Intrm. 50]

The High Commissioner is empowered to suspend such laws. Dep. Int. Sec. Order No. 3039, § 4(a). The other example concerns the Appellate Division of the High Court of the
Trust Territory which may accept appeals by writ of certiorari from the Appellate Division of this court. Dep. Int. Sec. Order No. 3039, § 5(b).

There being no precedent which would justify defining the Trust Territory as a "foreign state" to give the court diversity jurisdiction, next to be considered is the policy behind the exercise of jurisdiction.

The Journal of the Constitutional Convention of 1975, according to the court's search, does not reveal the reason for granting the national courts diversity jurisdiction. In the United States, only one reason is given: to guard against possible discrimination by a state court in favor of resident over nonresident litigants. Bank of the United States v. Deveaux, 9 U.S. [1828] USSC 23; (5 Cranch) 61, 87[1828] USSC 23; , 3 L. Ed. 38, 45 (1809).

If the court does not have jurisdiction, the alternative forum is the High Court, a branch of the Government of the Trust Territory. The High Court is at present the court of general trial jurisdiction (5 TTC 53) exercising jurisdiction over the area of the Federated States of Micronesia and beyond (5 TTC 4). It is not a provincial court.

The court finds no policy reason which would justify the exercise of its jurisdiction.

[1 FSM Intrm. 51]

Next to be considered is the nature of the Trust Territory government.

The Trust Territory is the government of the former mandate islands of Japan. After World War II the islands were Placed under the Trusteeship system of the United Nations. The United States is the administering authority. This authority was delegated to the President of the United States by Congress Of the United States. The President delegated the authority to the Secretary of the Interior who established the government of the Trust Territory. It is only concerned with portions of the Marianas, the Carolines and the Marshalls. It has no other sovereignty.¹

Under the Trusteeship Agreement, Article 6, the United States is obligated to foster the development of suitable political institutions with the goal of self-government by the inhabitants, and to promote economic, social and educational advancement. In no ordinary sense can the Trust Territory be considered a "foreign" state - it is the "state"
in this place.

A Point not argued should be discussed for completeness. The court was not asked to take jurisdiction only on the diversity of the Plaintiff and Maeda. The reason for

[1 FSM Intrm. 52]

requiring diversity between all the parties plaintiff and all parties defendant appears to be a corollary to the reasoning which supports diversity jurisdiction: the non-resident is not exposed to any possible discrimination because it is united in interest with a resident.

In the United States complete diversity of parties has long been the rule. Strawbridge v. Curtiss, 7 U.S. [1806] USSC 20; (3 Cranch) 267, 2 L. Ed. 435 (1806).

Counsel in this case, by not raising the point, apparently concede the correctness of this reasoning, and the persuasive force of the United States precedents.

The plaintiff not having established a basis for this court's jurisdiction the case must be dismissed.

Date: December 30, 1981

/s/
Richard Benson
Associate Justice

Filed
1/7/82

Clerk of Courts
Truk

1. The assertions in this paragraph are common knowledge in the area of this court. One wishing citations may refer to Gale v. Andrus, [1980] USCADC 235; 643 F.2d 826, 828, 829 (D.C. Cir. 1980).