Etscheit v Adams [1991] FMSC 30; 5 FSM Intrm. 243 (Pon. 1991) (11 December 1991)

[1991] FMSC 30; 5 FSM Intrm 243 (Pon 1991)

FEDERATED STATES OF MICRONESIA
SUPREME COURT TRIAL DIVISION

CIVIL ACTION NO. 1991-026

CAMILLE ETSCHEIT
ESTATE OF ELLA ETSCHEIT JOUBERT
ROBERT ETSCHEIT, SR.
ESTATE OF LEO ETSCHEIT
AND ROBERT ETSCHEIT, JR.,
in his capacity as administrator and an individual
Plaintiffs

V

YVETTE ETSCHEIT ADAMS
AND RENEE ETSCHEIT VARNER
Defendants

OPINION: December 11, 1991

BEFORE: Honorable Edward C. King, Chief Justice

APPEARANCES: For the Plaintiffs: Daniel J. Berman; For the Defendants: Fredrick L. Ramp, Attorney-at-Law

HEADNOTES

Jurisdiction - Diversity
When an estate is a party it is the citizenship of the estate representative that is to be considered for diversity purposes. Etscheit v. Adams, [1991] FMSC 30; 5 FSM Intrm. 243, 246 (Pon. 1991).

Jurisdiction - Diversity
Issues concerning land usually fall into state court jurisdiction, but if there are diverse parties having bona fide interests in the case or dispute, the Constitution places jurisdiction in the national courts even if interests in land are at issue. Etscheit v. Adams, [1991] FMSC 30; 5 FSM Intrm. 243, 246 (Pon. 1991).

Federalism - Abstention and Certification
Jurisdiction - Removal
If national court jurisdiction exists the national court should promptly grant the petition to remove. Thereafter the national court can entertain a motion to abstain or to certify specific issues to the state court. Proceedings in the national court do not have to stop while a certified issue is presented to a state court. Etscheit v. Adams, [1991] FMSC 30; 5 FSM Intrm. 243, 246 (Pon. 1991).

Jurisdiction - Diversity, - Removal
Where, for six and a half years after the national court had come into existence the non-citizen petitioners made no attempt to invoke the national court's jurisdiction, the non-citizen petitioners affirmatively indicated their willingness to have the case resolved in court proceedings, first in the Trust Territory High Court and later in Pohnpei State Court, and thus have waived their right to diversity jurisdiction in the national courts. Etscheit v. Adams, [1991] FMSC 30; 5 FSM Intrm. 243, 247-48 (Pon. 1991).

Jurisdiction - Diversity, - Removal
The fact that a "tactical stipulation," made in 1988 to eliminate all non-citizens as parties to the litigation and thus place the litigation within the sole jurisdiction of the state court, may have been violated in 1991, does not retroactively change the effect of the stipulation for purposes of jurisdiction. Etscheit v. Adams, [1991] FMSC 30; 5 FSM Intrm. 243, 248 (Pon. 1991).

COURT'S OPINION

EDWARD C. KING, Chief Justice:

The petition to remove filed in this case presents the question of whether non-citizens of the Federated States of Micronesia, who were parties in litigation pending in the Trust Territory High Court and then a state court for a total of seven years after this Court had been established, then in two ways indicated their willingness to present the issues to those courts for final decision, may now, some 23 years after the litigation was initiated, remove the case to the FSM Supreme Court trial division.

For the reasons discussed here, the Court concludes that the petitioners have waived their right to remove the case from the state court to this national court. The petition must therefore be denied.

I. FACTUAL BACKGROUND

This case involves a family dispute over title to land in Pohnpei State, and has an extended history. It was originally filed as PCA No. 343 in the trial division of the Trust Territory Court in 1968 by Carlos Etscheit against Leo Etscheit, Robert Etscheit, Sr., and Ella Etscheit Joubert. The case was transferred to the Pohnpei State Supreme Court in 1984. This Court is now presented with a new complaint, filed July 5, 1991, and a petition for removal, which the respondents oppose. The basic facts of the case, as presented in the plaintiffs' July 5, 1991 complaint and defendants' July 25, 1991 answer, are as follows.

The property in dispute includes four parcels in a section of land called Mpomp in Nett Municipality, as well as Sapwetik and Taketik Islands, all in the State of Pohnpei. The parties agree that Dominikus and Florentine Etscheit initially owned all of these properties and that their marriage produced five children, Leo, Carlos, Camille, Ella, and Robert, Sr.

Dominikus Etscheit died in 1925. The property went through a period where the Japanese government and later the United States government possessed title. By 1957 Florentine Etscheit received title to all properties from the government of the Trust Territory of the Pacific Islands. She quitclaimed her interests in these properties to all five of her children in 1957.

Leo Etscheit had no children and he conveyed his interest to Robert, Sr., who in turn executed a quitclaim deed to his son, Robert, Jr. In addition, Camille and Ella quitclaimed some of their interests to Robert, Jr. Carlos had three children, Yvette, Renee, and Monique. Carlos quitclaimed his interests to Yvette and Renee. The parties disagree as to the validity of some of these conveyances.

II. LEGAL ANALYSIS

The basis for plaintiffs' request for removal is article XI, section 6(b) of the Constitution of the Federated States of Micronesia, which reads:

“The national courts, including the trial division of the Supreme Court, have concurrent original jurisdiction in cases arising under this Constitution; national law or treaties; and in disputes between a state and a citizen of another state, between citizens of different states, and between a state or a citizen thereof, and a foreign state, citizen, or subject.”

Plaintiffs contend that "diversity" exists between the parties, and therefore this Court has jurisdiction. In the removal petition it is asserted that Robert Etscheit, Sr. is a French citizen, Camille Etscheit is a Belgium citizen, and Ella Etscheit Jourbert's estate representative is German, which is the citizenship to be considered for diversity purposes. See Annotation, Citizenship of Executor or Administrator as Test of Diversity for Purposes of Jurisdiction of Federal Court, 77 A.L.R. 910 (1932). These assertions appear undisputed. It is also undisputed that plaintiff is a citizen of the Federated States of Micronesia.

Assuming that these assertions are true, diversity of citizenship exists among the parties, and therefore there exists national court jurisdiction under article XI, section 6(b). However, the defendants have raised a number of issues in opposition to removal.

A. ABSTENTION OR CERTIFICATION

This is a land case. For that reason the defendants contend that this case belongs in state court, not national court.

This Court has previously recognized that issues concerning land usually fall into state court jurisdiction. In re Estate of Nahnsen, 1 FSM Intrm. 97 (Pon. 1982). "However, parties to a dispute within the scope of article XI, section 6(b) have a constitutional right to invoke the jurisdiction of this court." Bank of Guam v. Semes, [1988] FMSC 7; 3 FSM Intrm. 370, 379 (Pon. 1988). In Hawk v. Pohnpei, [1989] FMSC 24; 4 FSM Intrm. 85, 89 (App. 1989), the appellate division of this Court approved the Bank of Guam v. Semes analysis. "It is the solemn obligation of this Court and all others within the Federated States of Micronesia to uphold that constitutional right." U Corp. v. Salik, [1988] FMSC 20; 3 FSM Intrm. 389, 392 (Pon. 1988). See also In re Estate of Hartman[1989] FMSC 15; , 4 FSM Intrm. 386, 387 (Chk. 1989). Therefore, in property cases, if there are diverse parties having bona fide interests in the case or dispute, the Constitution places jurisdiction in this Court and this is so even if interests in land are at issue in the litigation.

Respondents also contend that needless delay will accompany certification of issues to state court if this court exercises jurisdiction. This argument is premature and does not bear upon the question of removal. Proceedings in this Court do not have to stop while a certified issue is being presented to a state court. If national court jurisdiction exists the Court should promptly grant the petition to remove. Thereafter, the Court can entertain a motion to abstain, or to certify specific issues to the state court.

B. WAIVER

This litigation began 23 years ago. Although it began in the Trust Territory High Court, it has proceeded for the past seven years in a state court. Defendants contend that the plaintiffs, by their delay in seeking removal, have waived any right to remove the case to this Court.

This Court previously addressed the question of waiver in U Corporation v. Salik, [1988] FMSC 20; 3 FSM Intrm. 389 (Pon. 1988). In Salik the Court held that "prolonged delay in seeking removal, as well as affirmative steps, such as filing a complaint, or a motion aimed at obtaining a substantive state court ruling, should normally be regarded as signalling acquiescence in state court jurisdiction." Id. at 393.

In Salik the case had been pending in the state court for some 18 months before the petition for removal was filed. This Court there said, "[T]his is far too great a lapse in time. In the future, such prolonged delay will be regarded as agreement to state court jurisdiction and will result in denial of a petition for removal." Id. at 394. In Salik however, the Court noted that prior to the decision there had been confusion and uncertainty concerning the right of removal and "it had not yet been established that options were available" to a party sued in state court in a case over which the national court has constitutional authority to exercise jurisdiction. Under those special circumstance, the Salik court decided, a finding that the delay of the petitioners constituted waiver would have been "perverse."

The delay in this case of course was much longer than in Salik and the burden of showing special circumstances must be commensurately greater. The petitioners nonetheless contend that special circumstances explain their delay and should preclude a finding of waiver.

Specifically, they contend that the respondent in April 1991 "dramatically" and "radically" altered theories in the litigation in such a way as to throw doubt upon the efficacy of the earlier attempts by Camille Etscheit, Robert Etscheit, Sr., and Ella Etscheit Jourbert to transfer their interests in the land at issue in the litigation to Robert Etscheit, Jr. Accordingly, the petitioners argue, their delay should be excused because they could not have known that diversity of citizenship existed until recently.

From July 12, 1981, when this Court began hearing cases, up through February 17, 1988, there existed diversity of citizenship among the parties. Yet, no effort was made during that time to remove the case to the national court. Instead, after awaiting a decision for more than ten years after a 1972 trial held before Trust Territory Chief Justice Harold Burnett, the petitioners in January, 1984 filed a motion with the Trust Territory High Court seeking a new trial. That motion was granted in February, 1984.

This Court began hearing cases on July 12, 1981. Thus, this Court was available to the petitioners. When they filed their motion for new trial asking the Trust Territory High Court to exercise jurisdiction over the case, they were choosing to place the entire litigation before that court.

In granting the motion for new trial Chief Justice Burnett's successor, Trust Territory High Court Chief Justice Alex Munson stated that "The court, through its effort, will supply the transcript of the trial testimony at its own expense." However, apparently the transcript of the 1972 trial never was produced. Although the Trust Territory Chief Justice apparently issued an order in March 1984 transferring the case to the state court, the case file in PCA 343 reflects no further action of any kind until late in 1987 when counsel wrote to the Pohnpei State Supreme Court inquiring about how to proceed with the case.

A conference was convened by Pohnpei Chief Justice Edwel Santos in December 7, 1987, and the petitioners were represented by their present counsel, Daniel Berman.

Up to February 1988 then, for six and one-half years after the national court had come into existence, the non-citizen petitioners were named in pending litigation, yet made no attempt to invoke this Court's diversity jurisdiction. Instead, the non-citizen petitioners took two steps affirmatively indicating their willingness to have the issues resolved in those court proceedings. The first step, of course, was the 1984 motion for a new trial in the Trust Territory High Court.

Second, in early 1988, all parties, pursuant to what the petitioners now refer to as a "tactical stipulation," took steps which culminated in the filing of new pleadings in the state court, omitting the non-citizen petitioners as parties and reflecting general agreement that Robert Etscheit, Jr. had obtained all of the former interests of Dr. Robert, Sr., Camille, Ella and Leo Etscheit. The effect of this stipulation, and presumably its purpose, was to place the litigation within the sole jurisdiction of the state court.

The fact that this stipulation may have been violated in 1991 when the respondents, in the state court proceedings, asserted that the attempted assignments of interests in land by the non-citizen petitioners to Robert Etscheit, Jr. were not effective, does not retroactively change the effect of the stipulation for purposes of jurisdiction.

What the court said in Salik is equally true in this case.

“The goals of efficient administration and judicial harmony dictate that parties be deemed to have agreed to state court jurisdiction unless desire to invoke national court jurisdiction is manifested promptly. It would be inappropriate to permit litigants to proceed with state court litigation long enough to elicit rulings from that court, then, if state court rulings prove unfavorable, to remove their litigation to national courts. Cf. Federated Shipping Co. v. Ponape Transfer & Storage, 3 FSM Intrm. at 260. Thus, prolonged delay in seeking removal, as well as affirmative steps, such as filing a complaint, or a motion aimed at obtaining a substantive state court ruling, should normally be regarded as signaling acquiescence in state court jurisdiction.”

Salik, 3 FSM Intrm. at 393.

III. CONCLUSION

The Court concludes that the non-citizen petitioners, through delay extending for some ten years while this Court was in existence, and by affirmatively indicating their acceptance of Trust Territory and state court jurisdiction, have waived their right to invoke the diversity jurisdiction of this Court. The petition to remove is denied and this case is dismissed.