Federated States of Micronesia v Cheng Chia-W (II) [1995] FMSC 36; 7 FSM Intrm. 205 (Pon. 1995) (27 July 1995)

FEDERATED STATES OF MICRONESIA
SUPREME COURT TRIAL DIVISION
Cite as Federated States of Micronesia v Cheng Chia- W (II), [1995] FMSC 36; 7 FSM Intrm. 205 (Pon. 1995)

THE FEDERATED STATES OF MICRONESIA,
Plaintiff,

vs.

CHENG CHIA-W, HORNG BAO YINN and TING HONG OCEANIC ENTERPRISES CO., LTD.
Defendants.

CRIMINAL CASE NO. 1994-502

MEMORANDUM OF DECISION

Andon L. Amaraich
Chief Justice

Trial: May 17, 1995
Sentencing Hearing: June 5, 1995
Judgment and Sentencing: June 19, 1995
Opinion Entered: July 27, 1995

APPEARANCES:

For the Plaintiff:
Mark L. Driver, Esq.
Chief of Litigation
Office of the FSM Attorney General
P.O. Box PS-105
Palikir, Pohnpei FM 96941

For the Defendants:
Jeanne Kent (trial)
Law Office of John Brackett
P.O. Box 208
Kolonia, Pohnpei FM 96941

For the Defendant (Ting Hong):
R. Barrie Michelsen, Esq. (sentencing hearing)
Law Offices of R. Barrie Michelsen
P.O. Box 1450
Kolonia, Pohnpei FM 96941

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HEADNOTES

Fishing
A person may be held criminally liable for violating any provision of Title 24 or of any regulation or permit issued pursuant to Title 24, or any provision of, or regulation under, an applicable domestic-based or foreign fishing agreement entered into pursuant to Title 24, or any condition of any permit issued in accordance with Title 24 and any regulations made under Title 24, respectively. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 211 (Pon. 1995).

Fishing
A defendant may be held criminally liable for failure to maintain a daily English language catch log as required under the terms of its foreign fishing agreement and the Harmonized Minimum Terms and Conditions. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 211-12 (Pon. 1995).

Criminal Law and Procedure
The law treats a company, although not an actual, living person, as a person for purposes of liability, and may hold it criminally liable. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 212 (Pon. 1995).

Agency; Fishing
A party to a foreign fishing agreement voluntarily assumes primary liability and responsibility for its own failure to comply with the law, and for similar failures on the part of its fishing vessels and vessel operators within the FSM. Such a party also assumes a legal duty to ensure that the operators of its licensed vessels comply with all applicable provisions of FSM law. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 212 (Pon. 1995).

Agency; Criminal Law and Procedure - Aiding and Abetting
A person can be criminally liable for the conduct of another if having a legal duty to prevent the commission of an offense, he fails to make proper effort to do so. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 212 (Pon. 1995).

Agency; Criminal Law and Procedure - Aiding and Abetting
The acts of agents, illegal or otherwise, are the acts of the principal itself provided that those acts are in the ordinary course of the agent's business relationship with its principal because under accepted principles of agency law a principal is responsible for the criminal acts of its agents provided that those acts where committed in furtherance of the agents' business relationship with the principal. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 212-13 (Pon. 1995).

Fishing
A defendant may be held criminally liable for failure to have a radio capable of monitoring VHF channel 16, the international safety and calling frequency, as required under the terms of its foreign fishing agreement. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 213-14 (Pon. 1995).

Fishing
A defendant may be held criminally liable for exceeding the crew size authorized under the terms of its foreign fishing permit which is a term that the permit holder cannot unilaterally alter by use of the notification of changes provision in the permit. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 214 (Pon. 1995).

Fishing
A defendant cannot be held criminally liable for failure to properly stow all fishing gear aboard a vessel in such a manner that it would not be readily available for use in fishing when the vessel was in an area in which it was authorized to fish. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 215 (Pon. 1995).

Fishing
A defendant may be held criminally liable for knowingly shipping, transporting, or having custody, control, or possession of any fish taken or retained in violation of Title 24 or any regulation, permit, or foreign fishing agreement or any applicable law even when the vessel is operating under a valid permit. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 216 (Pon. 1995).

Criminal Law and Procedure - Sentencing
The purpose of a sentencing hearing is to determine an appropriate sentence for criminal violations of which a defendant has already been convicted, not to reopen already decided issues of liability. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 219 (Pon. 1995).

Criminal Law and Procedure - Sentencing
Congress, by prescribing a mandatory minimum penalty, has determined that the penalty is proportionate to the nature of the crimes involved. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 219 (Pon. 1995).

Criminal Law and Procedure - Sentencing
Where a statute imposes a mandatory minimum fine and does not permit probation, a court cannot impose probation without violating the statute. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 219-20 (Pon. 1995).

Criminal Law and Procedure - Sentencing
Mitigating evidence cannot be used to depart below the mandatory minimum penalty required by the statute. A court may only consider that evidence in deciding whether the minimum sentence should be enhanced. FSM v. Cheng Chia-W (II), [1995] FMSC 36; 7 FSM Intrm. 205, 220 (Pon. 1995).

* * * *

COURT'S OPINION

ANDON L. AMARAICH, Chief Justice:

This Memorandum of Decision issues to explain the reasoning behind the Court's findings and sentence in this case as set forth in its Judgment of Conviction and Sentencing Order dated June 19, 1995. On August 24, 1994, officers of the FSM Marine Surveillance Office seized the vessel Horng Yih Fwu #130 (the "Vessel") and arrested the captain and crew members aboard for alleged violations of the FSM fishery laws. After learning that this Vessel was operating in the FSM Exclusive Economic Zone pursuant to an agreement entered into between Ting Hong Oceanic Enterprises Co., Ltd. ("Ting Hong" or the "Company"), the FSM Government, through the Office of the FSM Attorney General, filed a Criminal Information against the captain and chief engineer of the seized Vessel, and against Ting Hong, charging them with six violations of Title 24 of the FSM Code.

Following the Initial Appearance, the Government voluntarily dismissed Count I of the Information,[1] and on May 17, 1995, the case proceeded to trial on the remaining counts. Although the two individual defendants did not appear for trial, all of the defendants were represented by the same counsel,[2] and each of the defendants entered a plea of not guilty. In its case in chief, the Government presented the testimony of four witnesses: Vincent Wichap and Dexter Benjamin, two marine surveillance officers, the first of whom was a member of the party that boarded the Vessel prior to seizure, Craig Heberer, a marine biologist employed by Micronesian Maritime Authority ("MMA"), and Lola Wang, an employee of defendant Ting Hong. The Government also entered a number of documents into evidence, including the Foreign Fishing Agreement entered into between Ting Hong and the MMA and the Vessel's permit. Although defendants' cross-examination of Lola Wang was permitted to venture beyond the scope of the direct examination, defendants did not call any additional witnesses at trial. Based on the evidence and testimony introduced at trial, the Court found the following facts to be established beyond a reasonable doubt:

Facts

On April 16, 1994, Defendant Ting Hong entered into an agreement with the Micronesian Maritime Authority, the agency of the Government of the Federated States of Micronesia responsible for entering into such agreements. The agreement, which was entitled "Foreign Fishing Agreement Between The Micronesian Maritime Authority And Ting Hong Oceanic Enterprises Co. Ltd," was signed by the chairman of the Ting Hong delegation appointed to negotiate with MMA, and declared that its purpose was to establish "reasonable terms and conditions pertaining to the Company's [Ting Hong's] utilization of fisheries resources within the Exclusive Economic Zone ["EEZ"] of the Federated States of Micronesia." The only parties mentioned in the agreement are Ting Hong and MMA, and, other than that of Ting Hong's chairman, the only signature contained on the document is that of MMA's chairman.

As part of the agreement, defendant Ting Hong agreed to "abide by all applicable laws, rules and regulations of the Federated States of Micronesia and its States including but not limited to, Titles 18 and 24 of the Code of the Federated States of Micronesia." In addition, Ting Hong agreed "to comply with the Harmonised Minimum Terms and Conditions ["HMTCs"] for Foreign Fishing Vessel Access,"[3] and to "ensure that its authorized Vessels comply with the provisions of this agreement and all applicable laws and regulations." In recognition of the duties and responsibilities assumed by Ting Hong, the MMA agreed to permit up to 270 of "the Company's longline fishing vessels" to enter into the FSM EEZ to engage in fishing activities on behalf of Ting Hong.

The foreign fishing agreement outlined several other responsibilities assumed by Ting Hong as well. According to paragraph 9 of the Agreement signed by Ting Hong, vessels authorized under the agreement "shall continuously monitor the international distress radio frequency 2.182 KHz and 156.6 MHz (Channel 16, VHF) for the purpose of facilitating communication between such vessels and air and seaborne authorities of the Federated States of Micronesia wishing to establish the credentials of the vessel while in the [Exclusive Economic Zone]." The requirement that all vessels licensed under the foreign fishing agreement monitor VHF Channel 16 was restated in the HMTCs: "a vessel operator shall ensure the continuous monitoring of the . . . international safnty allicalling frequency . . . nel 1-FM) to ) to facilitcilitate communication with the fisheries management, surveillance and enforcement authoritiea cou"

Treign fishing agreement also also mandamandated that "[e]ach Authorized Vessel shel shall mall maintain a catch log in English on board the Vessel and make such log available for inspection by officers authorized by the [MMA]," and that Ting Hong "shall complete and transmit to the [MMA] catch reports in the form set forth in Appendix B in the English language, with daily entries of all catch in the [Exclusive Economic Zone] of the Federated States of Micronesia." The agreement further stated that "[Ting Hong] and each authorized Vessel Master shall ensure that all the records are accurate for the entire given trip," and that the catch report shall be submitted to the MMA within ten days of the completion of a fishing voyage.

In addition to the language contained in the foreign fishing agreement, Ting Hong's designated trial representative, Lola Wang, admitted both at trial and in an earlier affidavit, that she was familiar with the foreign fishing agreement and that under the terms of that agreement, Ting Hong assumed responsibility for ensuring that its vessels comply with the foreign fishing agreement and with the other laws of the FSM. In addition, the Government submitted into evidence Ting Hong's responses to a Foreign Fishing Agreement Questionnaire, in which Ting Hong's president indicated that "Ting Hong will assume responsibilities for the fishing vessels in FSM licensed through Ting Hong's agreement with MMA," and that "Ting Hong assumes liability for the fishing vessels in the F.S.M." The Government also introduced copies of the FSM Foreign Investment Permits and business licenses pertinent to this case, all of which were issued to Ting Hong and without which this vessel would not have been permitted to fish in the FSM.

On August 9, 1994, Ting Hong submitted a permit application form requesting that the MMA issue a "Foreign Fishing Permit" authorizing the Vessel, the Horng Yih Fwu No. 130, to enter into the FSM Exclusive Economic Zone to conduct fishing operations. The application form was signed by Lola Wang on behalf of Ting Hong. Pursuant to Ting Hong's request, the MMA issued a one-month permit that was valid until September 8, 1994. The permit instructed that "[f]ishing operations are to be conducted in accordance with Title[s] 18 & 24 of the FSM Code," set the authorized crew size at 8, and required that the "Approved Catch Record shall be maintained and shall be produced to an authorized inspector of the Federated States of Micronesia when required."

At approximately 2:00 p.m. on August 24, 1994, marine surveillance officers employed by the FSM National Government observed the Vessel, a longline fishing boat, operating in FSM waters off the State of Chuuk. Navigational equipment aboard the marine surveillance vessel, including a Global Positioning System, indicated that the Vessel was operating approximately 100 miles within the boundary of the FSM Exclusive Economic Zone at latitude 06 degrees, 22.1 minutes North, and Longitude 149 degrees, 04.4 minutes East. The surveillance officers boarded the Vessel in order to conduct a routine surveillance inspection.

Upon boarding the Vessel, the officers noted the presence of eleven crew members, including the captain, Cheng Chia-W, and the chief engineer, Horng Bao Yinn. As part of their inspection, members of the boarding party entered the wheelhouse and requested that the captain provide them with the Vessel's permit, as well as its log book and catch log. The captain produced an expired permit allowing for an eight member crew, as well as a packet containing documents written in Chinese. While the boarding officers were able to determine that the Vessel had been in FSM waters since August 14, 1994, they were unable to understand any of the other information. According to Officer Wichap, however, none of the documents were maintained for the month of August,[4] and the information packet did not contain any catch reports in the form required by the foreign fishing agreement. The boarding officers also observed that the Vessel did not have a radio capable of monitoring the international safety and calling frequency.

Surveillance officers also inspected the Vessel's storage facilities where they noted the presence of 130 pieces of freshly caught fish. After completing their inspection, the boarding party seized the Vessel and arrested the eleven crew members on board. The marine surveillance officers escorted the seized vessel and its crew to Pohnpei and turned the case over to the Office of the FSM Attorney General for further investigation.[5]

After determining that the Vessel had been operating within the FSM Exclusive Economic Zone, pursuant to the agreement entered into between Ting Hong and MMA, the Office of the Attorney General filed the Criminal Information against the captain, the chief engineer, and Ting Hong, charging each of them with violating six criminal offenses. All six counts relate to alleged violations of Title 24 of the FSM Code. Except for the charge relating to defendants' alleged failure to properly stow their fishing gear, the counts are all based on defendants' alleged failure to comply with certain requirements of the foreign fishing agreement, the Vessel's permit, or the HMTCs.

In addition to the information outlined above, the Government elicited testimony from Lola Wang, Ting Hong's official representative at trial, regarding Ting Hong's efforts to ensure that vessels permitted under its agreement comply with applicable FSM law. According to Lola Wang, this was the Vessel's first trip into the FSM under the authority of a Ting Hong foreign fishing agreement, and that it is Ting Hong's practice, in this case and in general, not to instruct the operators of its vessels on their legal duties and responsibilities prior to their initial entry into the FSM EEZ. Instead, Ting Hong awaits receipt of the Vessel's permit and then informs the Vessel's operators only that the Vessel is now permitted to enter the FSM EEZ in order to begin fishing operations. Lola Wang further admitted that this was Ting Hong's practice in the present case even though its Pohnpei office could have fully briefed the Vessel's crew on the legal requirements for fishing in the FSM before it left port in Taiwan. Finally, Lola Wang stated that the crews aboard Ting Hong licensed vessels, including the Vessel in this case, are only apprised of their legal duties and obligations within the FSM after the vessels dock in Pohnpei. According to Lola Wang, Ting Hong intended to explain to the Vessel's crew their legal responsibilities as soon as they got to Pohnpei, but was prevented from doing so due to the Vessel's arrest. Lola Wang also explained that Ting Hong did not supply this Vessel's operators in advance with copies of Title 24, the foreign fishing agreement, the HMTCs, the designated information for catch logs, or any other related documents.

At trial, the Court found defendants guilty of three separate violations of 24 F.S.M.C. 501(1)(a) & (c), which makes it unlawful to "violate any provision of [Title 24] or of any regulation or permit issued pursuant to [Title 24]," or "any provision of, or regulation under, an applicable domestic-based or foreign fishing agreement entered into pursuant to [Title 24] or any condition of any permit issued in accordance with [Title 24] and any regulations made under [Title 24]," respectively. The violations were based on defendants' failure to maintain a daily English language catch log as required under the terms of the foreign fishing agreement, the defendants' failure to maintain and continuously monitor the international safety and calling frequency as required under the foreign fishing agreement and the Harmonized Minimum Terms and Conditions, and for exceeding the maximum authorized crew size as fixed by the provisions of the Vessel's permit. The Court also found defendants guilty of violating section 501(1)(l) of Title 24, which makes it unlawful "to knowingly ship, transport . . . or have custody, oontrr p or possession of any fish taken or retained in violation of this title or any regional fishing treaty, regulation, permit, foreign or domestic-based fishing agreement or any applicable law." In this case, the Court found that the defendants did knowingly control, possess, and transport fish, and that those fish were taken while defendants were acting in violation of Title 24, the foreign fishing agreement, and the permit issued to this Vessel. The Court acquitted defendants on the count involving the improper stowage of fishing gear, however, finding that defendants had not violated section 105, and, in the alternative, that the Government failed to carry its burden of proof on this issue. The Court will now discuss each of the counts for which judgment was rendered at trial.

Failure to Maintain Catch Log

Count IV of the Information filed by the Government, charging violations of sections 501(1)(a) & (c) of Title 24, alleged that "[o]n or about August 24, 1994, the defendants and each of them failed to maintain a catch log in English on board the vessel and make that log available for inspection as required by the applicable fishing agreement and 24 FSMC § 404."

As stated abov above, subsections 501(1)(a) and (c) make it a crime to violate provisions of Title 24, or of any regulatiormit, or agreement entered into pursuant to Title 24. In this instance, both the foreign fign fishing agreement and the Harmonized Minimum Terms and Conditions, stated that defendants were obligated to maintain a daily English language catch log aboard the vessel. The HMTCs also prescribed the form in which the required information must be recorded in order to ensure that all necessary information is provided. The permit issued to this Vessel further required that the "Approved Catch Record shall be maintained and shall be produced to an authorized inspector of the Federated States of Micronesia when required." The uncontested evidence at trial was that the individual defendants failed to maintain a daily catch log during the period of time authorized by the Vessel's permit. At the request of the surveillance officers, the captain and crew of the Vessel did not produce an "Approved Catch Record" at the request of the marine surveillance officers who boarded the Vessel, and no such catch log was produced by any of the defendants, including Ting Hong, at a later date. Although some evidence was offered to establish that the individual defendants had been recording an informal tally of their catch, no such records were kept for the period of time during which the Vessel was fishing in the FSM EEZ. There also was no dispute that the information that was provided was not in English and that it did not contain all of the data required by the catch report form that was designated by the Harmonised Minimum Terms and Conditions. Accordingly, the Government established, beyond a reasonable doubt, all of the elements necessary to find all three defendants guilty of this violation of Title 24.

Ting Hong also is liable on this count. Although defendant Ting Hong is a company, and not an actual, living person, the law treats the company as a person for purposes of liability. See generally Mid-Pac Constr. Co. v. Senda, [1990] FMSC 23; 4 FSM Intrm. 376 (Pon. 1990). As a result, Ting Hong is criminally liable for its failure to maintain adequate catch records, as well as its failure to ensure that the operators of its Vessel did the same. According to the foreign fishing agreement entered into between Ting Hong and MMA, and as Ting Hong readily admitted at trial, the purpose of the foreign fishing agreement was to enable Ting Hong to utilize the fisheries resources of the FSM. To meet this purpose, the foreign fishing agreement authorized up to "270 of the [Ting Hong's] longline fishing vessels" to fish within the FSM Exclusive Economic Zone. The fishing agreement also stated that Ting Hong would "abide by all applicable laws, rules and regulations of the Federated States of Micronesia and its States including but not limited to Titles 18 and 24 of the Code of the Federated States of Micronesia." The foreign fishing agreement, which spells out the nature of the relationship between Ting Hong and the FSM, stated that the agreement was for Ting Hong's benefit, that the vessels to be licensed under the agreement were Ting Hong's, that Ting Hong would abide by all applicable FSM laws, and that Ting Hong would ensure that its vessel operators did the same. Accordingly, Ting Hong voluntarily assumed primary liability and responsibility for its own failure to comply with the law, and for similar failures on the part of Ting Hong's fishing vessels and vessel operators within the FSM. Ting Hong did not maintain a catch log for its Vessel in this case, and therefore violated the applicable portion of Title 24. Ting Hong also assumed a legal duty to ensure that the operators of Ting Hong licensed vessels complied with all applicable provisions of FSM law. Ting Hong made absolutely no attempt to ensure that this Vessel complied with this provision of FSM law, and is therefore liable on that basis as well. See 11 F.S.M.C. 301(1)(c) (stating that a person can be liable for the conduct of another if "having a legal duty to prevent the commission of an offense, he fails to make proper effort to do so").

As an added matter, even if the foreign fishing agreement had not stated that Ting Hong was responsible for the actions of its vessels and vessel operators, the evidence adduced at trial, especially the admissions of Ting Hong's trial representative, clearly established an agency relationship between Ting Hong and its vessel operators, such that Ting Hong, for purposes of criminal liability, was a principal responsible for the criminal acts committed by its agents/Vessel operators within the normal course, and in furtherance, of their business relationship with Ting Hong. See 11 F.S.M.C. 301(1)(c).[6] See generally 3 Am. Jur. 2d Agency (1986); 53 Am. Jur. 2d Master and Servant (1970).[7] The acts comprising this violation plainly were undertaken in the ordinary course of Ting Hong's business relationship with its vessel operators, and therefore, Ting Hong is liable for the Vessel operators' failures to comply with the FSM law and with the terms of Ting Hong's foreign fishing agreement as if those failures were Ting Hong's own. The reason for this is because the acts of Ting Hong's agents, illegal or otherwise, are the acts of Ting Hong itself provided that those acts are in the ordinary course of the agent's business relationship with its principal.

In sum, Ting Hong is liable for its own failure to comply with FSM law and with the provisions of its foreign fishing agreement. Ting Hong is also liable because, under the terms of its agreement with MMA, it assumed, and neglected, its legal duty of ensuring that its vessel operators within the FSM EEZ comply with FSM law and with Ting Hong's foreign fishing agreement. 11 F.S.M.C. 301(1)(c). Finally, Ting Hong is liable under accepted principles of agency law, because Ting Hong, as principal, was responsible for the criminal acts of its agents provided that those acts where committed in furtherance of the agents' business relationship with the principal. See Martin J. Weinstein & Patricia B. Ball, Criminal Law's Greatest Mystery Thriller: Corporate Guilt Through Collective Knowledge, 29 New Eng. L. Rev. 65, 68-69 (1994).

Failure to Maintain Proper Radio

In this count, also alleging a violation of sections 501(1)(a) & (c), the Government asserted that

[o]n or about August 24, 1994, the defendants and each of them failed to maintain and have on board the vessel a radio capable of monitoring radio frequency 2.182 KHz and 156.6 MHz (Channel 16, VHF) for the purpose of facilitating communication between such vessels and authorities of the FSM wishing to establish the credentials of the vessel in violation of the applicable foreign fishing agreement.

The foreign fishing agreement entered into between Ting Hong and the MMA required Ting Hong to meet this requirement and to ensure that all vessels operating under Ting Hong's agreement maintained and monitored VHF channel 16, the international safety and calling frequency. Once again it was uncontested at trial that the Vessel in this case did not have a radio capable of monitoring this frequency. Accordingly, individual defendants violated 24 F.S.M.C. 501(1)(a) & (c) by failing to maintain and monitor a radio capable of receiving the international safety and calling frequency, while Ting Hong's liability arises from their own failure to maintain the radio, their failure to ensure that the operators of this Ting Hong licensed Vessel complied with this requirement, and by virtue of its agency relationship with the vessel operators.

Exceeding Authorized Crew Size

This Count alleges that the defendants violated sections 501(1)(a) & (c) in that "[o]n or about August 24, 1994, the defendants and each of them caused to have on board the vessel in FSM waters, eleven total crew members more than and in violation of the allotted number allowed by the permit."

Defendants admit that there were eleven crew members aboard the Vessel and that the permit only allowed for a total of eight members on board. Defendants nevertheless claim that they did not violate the provision of the permit because the Foreign Fishing Vessel Application Form, upon which the permit is based, states that the applicant "is required to report any changes to the above information within 60 days." Defendant Ting Hong notified the MMA that the information contained on the permit application form was inaccurate after the Vessel's arrest, but before the expiration of the sixty-day period. As a result, defendant Ting Hong asserts that it cannot be found guilty of violating the crew size authorization contained in the Vessel's permit.

The Court rejects defendant Ting Hong's interpretation of the provision of the permit application form, and concludes that it is merely a notice, or reporting provision. In its entirety, the requirement on the application form states as follows: "I declare that the [] information [contained in the permit application form] is true and complete. I understand, I am required to report any changes to the above information within 60 days, and further understand that failure to do so may affect good standing on the Regional Register." According to the plain language of the provision, an applicant is required to inform the MMA if the information contained in the permit ceases to be accurate. While the provision requires the applicant to give notice of a change or a clerical error in the application form, it does not state that the applicant may unilaterally alter its permit simply by notifying the MMA of a change.

In this case, the permit was issued for eight crew members. In reality, as defendant Ting Hong readily admitted at trial, the Vessel had eleven crew members aboard. This constitutes a violation of a material provision of the Vessel's permit. Unlike in the case of a clerical error, such as the misspelling of the name of a vessel, this authorized crew size directly affects this Vessel's ability to harvest fish from the FSM Exclusive Economic Zone. The more crew members on board a particular vessel, the greater that vessel's ability to increase the number of fish caught. The need to conform to the crew size authorization contained in the permit also raises obvious immigration and safety issues. Every nation must concern itself with issues of immigration. In that regard, ensuring conformity with authorized crew sizes is the only effective way for the FSM to monitor the number of non-FSM citizens that are entering the FSM on foreign fishing vessels, and to make sure that these individuals do not attempt to remain in the FSM illegally. Most importantly of all, requiring vessels to conform their crew sizes to the numbers on file with the MMA assures the safety and welfare of the crew by ensuring that individual crew members will not be overlooked or unaccounted for in the event of an emergency at sea. For these reasons, the Court concludes that defendants were not permitted to unilaterally alter this provision of the permit. Moreover, although defendants were obligated to report to MMA that the information contained in the permit application form was no longer accurate, that reporting did not automatically amend the Vessel's permit to allow for an eleven member crew. Defendants never received authorization to increase their crew size, and as a result, the presence of eleven crew members constituted a violation of Title 24.

In conclusion, the Government established, beyond a reasonable doubt, defendants' liability for exceeding the crew size as authorized by the foreign fishing permit for this Vessel. As in the case of the prior counts, the liability for this violation extends to Ting Hong as well as to the individual defendants.

Stowage of Gear

According to the Government,

[o]n or about August 24, 1994, the defendants and each of them, failed to properly stow all fishing gear aboard the vessel in such a manner that it would not be readily available for use in fishing, except when such fishing vessel is in an area in which it is authorized to fish in accordance with Title 24 of the Code of the Federated States of Micronesia.

Section 105 of Title 24, entitled "Stowage of Fishing Gear," states that "[a]ll fishing gear aboard a fishing vessel in the exclusive economic zone shall be stowed in such a manner that it is not readily available for use in fishing, except when such fishing is in an area in which it is authorized to fish in accordance with this title." According to the plain language of section 105, a vessel need not stow its gear when it is in an area in which it is authorized to fish.[8] The Government itself established, however, that the Vessel was fishing in an area, the FSM Exclusive Economic Zone, in which it was authorized to fish under the terms of its permit and of the foreign fishing agreement entered into by Ting Hong.[9] Accordingly, the Government failed to prove a critical element of this violation.

Even assuming that the section 105 could be interpreted in the manner suggested by the Government, the Court nonetheless would find that the Government failed to establish this violation beyond a reasonable doubt. Unlike, the catch report and radio claims, which are readily provable and not subject to subjective interpretation, the stowage of gear claim requires the Court to determine whether the Vessel's fishing gear was stowed "in a manner that is not readily available for use in fishing." 24 F.S.M.C. 105. The Government presented virtually no evidence on the manner in which the fishing gear was stowed, and presented no evidence at all as to whether the manner of stowage prevented the gear from being available for fishing purposes. The only testimony offered by the Government was Officer Wichap's statement that he observed two baskets of fishing line and buoys on the deck rather than in the stern. The Government offered no documentary evidence, such as photographs, and gave no indication as to whether the lines and buoys were "readily available" for fishing, or whether they were secured and locked up on deck. Accordingly, the Court was not presented with sufficient information with which to conclude that defendants' fishing gear was not properly stowed, and thus, defendants must be found not guilty of this violation.

Transportation and Possession of Fish

The final count in the Information filed by the Government, claimed that defendants violated 24 F.S.M.C. 501(1)(l) in that "[o]n or about August 24, 1994, the defendants and each of them, knowingly shipped, transported, had custody, control, or possession of fish taken or retained in violation of Title 24 of the Code of the Federated States of Micronesia and the applicable fishing agreement." Defendants do not deny that they engaged in fishing operations within the FSM Exclusive Economic Zone. They likewise admit that they shipped, transported, and had custody, control, and possession over the fish they took from FSM waters. Nonetheless, defendants argue that they did not violate section 501(1)(l) because their taking, shipping, transporting, and possessing of the fish in question was done pursuant to a valid permit authorizing them to do so.

Section 501(1)(l) states as follows:

(1) It is unlawful for any person: . . .

o knowingly sgly ship, transport, offer for sale, sell, purchase, import, export, or have custody, control, or possession of any takeretained in violation of this title or any regional fishing treaty, regulation, pon, permitermit, foreign or domestic-based fishing agreement or any applicable law.

The plain language of section 501(1)(l) states that it is unlawful to transport or possess fish that are taken from FSM waters in violation of any of the applicable laws of the FSM. Thus, defendants, even when operating under a valid permit, are not permitted to take or retain fish from FSM waters unless they are in compliance with all applicable laws, including Title 24, and the requirements of any foreign fishing agreements and other documents entered into pursuant to Title 24. Section 501(1)(l) is not limited, as defendants argue, to cases where fish are taken or retained from FSM waters in the absence of a valid permit.

In this case, the Government demonstrated beyond a reasonable doubt that the defendants violated Title 24, as well as provisions of the foreign fishing agreement entered into between MMA and Ting Hong, by, inter alia, failing to maintain a catch log and a proper radio. The Government likewise established the additional element of transporting and possessing fish taken from FSM waters, through the uncontested testimony of boarding officer Wichap that there were 130 fresh fish being stored aboard the Vessel as well as through the admission of defendant Ting Hong's representative, Lola Wang. Furthermore, defendant Ting Hong indicated that it was aware that it was in possession and transportation of the fish in question, thus establishing every element of this violation beyond a reasonable doubt. Accordingly, the Court found that the defendants in this case violated section 501(1)(l) of Title 24.

Sentencing

At the conclusion of the liability phase of the trial, the Court proceeded to sentencing. After several extensions of time due to defendants' decision to retain new counsel,1[0] the Court conducted a sentencing hearing on June 5, 1995. Prior to the sentencing hearing, however, the Government filed a Sentencing Memorandum in which the Government argued, inter alia, that according to 24 F.S.M.C. 503, each of the four convictions in this case required the imposition of a minimum $500,000.00 fine. As a result, the Government argued that the mandatory minimum sentence for the four violations in this case was a fine of $2,000,000.00.

In both its sentencing memorandum and at the sentencing hearing, the Government placed special emphasis on the justification for the mandatory minimum amount of fine, not as a revenue source, but as a deterrent to illegal exploitation of the living marine resource. In that regard, the Government directed the Court's attention to Congress's "Statement of Purpose" contained in Title 24 of the FSM Code,1[1] and underscored the difficulties facing the FSM in its attempts to effectively patrol the almost two million square miles of ocean contained within the FSM EEZ, with its limited and relatively scarce resources; to wit, marine surveillance is responsible for patrolling the entire economic zone with only two patrol surveillance vessels donated from outside sources, and an annual budget of approximately $1,200,000.00.1[2]

The Government then proceeded to argue that the mandatory minimum sentence was actually an insufficient penalty based on the facts of this case. As a result, the Government requested that the Court enhance the mandatory minimum sentence for a number of reasons, including defendant Ting Hong's "conduct and corporate character," and because a larger fine is necessary to deter a corporation of Ting Hong's size from engaging in future violations of FSM fishing law. According to the evidence produced by the Government, Ting Hong is the largest single fishing operator in the FSM, accounting for over 60% of all catch in the FSM. Moreover, Ting Hong vessels harvest from FSM waters and sell in the Japanese market approximately $90,000,000 of sashimi grade tuna each year. The Government also brought to the attention of the Court a number of other instances where Ting Hong has allegedly engaged in illegal conduct within the FSM, Guam, and Palau. These alleged infractions, which are not part of the violations to which Ting Hong has been found guilty in this case, include additional violations of Title 24 by other Ting Hong vessels, illegal transshipment operations in Guam without MMA's permission as required under defendant's foreign fishing agreement and bribery of public officials in Palau.1[3]

At the sentencing hearing, and in a submission entitled sentencing memorandum/statement in mitigation/request for probation, defendant's new counsel argued that it had been retained only by defendant Ting Hong, that Ting Hong had interests that differed from those of the individual defendants, and that counsel could not simultaneously represent its client and the two individual defendants without creating a conflict of interest. Based on Ting Hong's representations, as well as the fact that the individual defendants no longer had the benefit of counsel, sentencing proceeded only against defendant Ting Hong.

According to Ting Hong's arguments at sentencing, Ting Hong is merely an agent for the captain (who Ting Hong claims is the actual owner of the Vessel and the principal) and therefore should not be penalized for the illegal acts of those defendants. Ting Hong claims that it does not own the Vessel, that it cannot be held responsible for the captain, the Vessel, or its crew, and that Ting Hong's only real involvement with the Vessel concerned the minimal administrative act of securing a foreign fishing permit that allowed the Vessel to enter the FSM to engage in fishing activities. Despite the apparent inconsistency between Ting Hong's new approach and its admission that it had contracted with MMA to "ensure that its Authorized Vessels comply with the provisions of the [foreign fishing agreement] and all applicable laws and regulations," Ting Hong argues that this provision of the foreign fishing agreement should not be enforced because "[f]orbearance to commit a crime is something that is required of all." (citing 1A Corbin on Contracts § 189). Specific Ting Hong clng claims it should not be required to ensure that the captain forbear from committing a crime because the captain is already under such a legal duty. In making this argument, defendant Ting Hong makes no attempt to reconcile it with section 301 of Title 11 of the FSM Code, the portion of the Code which provides for criminal liability for the acts of another. Finally, defendant Ting Hong argued that a substantial fine is not necessary because, inter alia, it is not warranted by Ting Hong's corporate character and because such a fine would be disproportionate to the nature of the offenses committed. Instead, Ting Hong urges that the Court suspend the fine and impose probation pursuant to 11 F.S.M.C. 1002.1[4]

The purpose of the sentencing hearing is to determine an appropriate sentence for criminal violations of which a defendant already has been convicted. The purpose of a sentencing hearing is not to reopen already decided issues of liability. In this trial, like all other criminal trials, liability must be established before the trial may proceed to the sentencing phase. During the liability phase of this trial, defendant Ting Hong was found guilty of violating four provisions of Title 24 of the FSM Code. Ting Hong's liability flowed from its own failure to comply with the laws of the FSM, from its failure to ensure that the vessels operating pursuant to Ting Hong's fishing agreement complied with the laws of the FSM, an obligation that Ting Hong assumed voluntarily, and because, based on the facts adduced at trial and the law, the Court concluded that Ting Hong was the principal, not the agent, for purposes of assuming liability for violations of FSM law and of the foreign fishing agreement by fishing vessels operating pursuant to Ting Hong's foreign fishing agreement. Defendant Ting Hong admitted that it was responsible for the acts of its vessel operators, and, more importantly, the Court found this liability to exist based on the evidence produced at trial and upon the law of this nation. Accordingly, the focus of the sentencing hearing is to determine the appropriate sentence to be imposed upon defendant Ting Hong due to its unlawful conduct.

Section 503 of Title 24 of the FSM Code defines the appropriate penalty for violations of section 501 of that Title:

Section 503. Criminal Penalties.

(1) A person is guilty of an offense if he commits any act prohibited by section 501 of this chapter.

(2) Any offense described as a prohibited act by subsections (1)(a) . . ., (c) . .(;., &#1 .;. . of;. of section 501 is punishable by a fine of not less than $500,000.

The plain language of thelty pion ole 24, as adopted by Congress, definitively establishes that each of thof the foue four vior violations for which defendant Ting Hong has been found liable requires the imposition of a mandatory minimum fine of at least $500,000.00. 24 F.S.M.C. 503. By prescribing this mandatory minimum penalty, Congress has determined that, because of the importance of the fishery to the health, welfare, and economic security of the people of this nation, the penalty is proportionate to the nature of the crimes involved. See 24 F.S.M.C. 101. In fact, the fishery is the FSM's most important, indeed its only, viable resource of economic significance, and its preservation is necessary to ensure the preservation of this nation and its peoples. Accordingly, the Court rejected defendant Ting Hong's request for probation pursuant to 11 F.S.M.C. 1002.1[5] The statute does not permit probation, and the Court cannot impose probation without violating the clear language of section 503.

Defendant also argued that the penalty in this case should be mitigated due to defendant's substantial investments and contributions to the FSM, because the defendant has not previously been convicted of a crime before this Court, and because Ting Hong is an important and longstanding revenue source for the FSM. The Court has considered defendant Ting Hong's statement in mitigation. Although the Court is permitted to consider, and has in fact considered, the mitigating evidence offered by defendants, the Court is foreclosed from reducing Ting Hong's sentence below $2,000,000.00, because of the mandatory minimum nature of the penalty statute applying to defendant Ting Hong's violations. Mitigating evidence cannot be used to depart below the mandatory minimum penalty required by the statute. Rather, the Court may only consider that evidence in deciding whether or not the minimum sentence should be enhanced.

After reviewing the arguments and submissions of defendant Ting Hong, however, the Court concluded that defendant Ting Hong did not offer any convincing evidence in mitigation. While the Court also reviewed the aggravating evidence offered by the Government, the Court, as stated earlier, was not persuaded by the Government's argument that Ting Hong's sentence should be enhanced based on the bribery charges filed against Ting Hong in Palau. The Court was concerned, however, by defendant Ting Hong's defiant attitude at sentencing. Defendant's posture was marked by an unwillingness to accept responsibility for its unlawful conduct, and a complete lack of remorse for that conduct.

Based on the nature of Ting Hong's criminal conduct, the evidence and testimony presented at trial, as well as Ting Hong's refusal to accept responsibility for its actions, the Court imposed a total fine of $2,200,000.00 on defendant Ting Hong. The Court imposed $600,000.00 fines for defendant Ting Hong's violations pertaining to its illegal transportation and possession of fish and its failure to maintain the requisite catch report data, and $500,000.00 fines for defendant Ting Hong's failure to maintain a proper radio on board the Ting Hong licensed Vessel and for exceeding the authorized crew size of this Vessel.

Thus, the Court essentially imposed on defendant Ting Hong the minimum sentence required by law. The sentence imposed on defendant Ting Hong is proportionate to the seriousness of defendant Ting Hong's crimes, and reflective of defendant's criminal culpability with respect to those violations. Finally, as to the two violations in which the Court enhanced defendant's sentence - the failure to maintain a catch log, and the illegal taking of fish - the Court based its enhancement on its belief that these violations are extremely serious in nature, and because defendant Ting Hong's conduct was particularly delinquent and irresponsible with respect to those claims.

Conclusion

In conclusion, based on the evidence presented and for the reasons stated above, the Court found defendants Ting Hong, Cheng Chia-W, and Horng Bao Yinn, guilty beyond a reasonable doubt of four violations of Title 24 of the FSM Code: three violations of sections 501(1)(a) & (c) relating to defendants' failure to maintain proper catch records, to maintain and monitor the international emergency and calling frequency, and for exceeding the crew size authorized by the permit issued to the Vessel, and one violation of section 501(1)(l) for illegally taking and retaining fish. Accordingly, and pursuant to the mandate of 24 F.S.M.C. 503, the Court sentenced defendant Ting Hong to a total criminal fine of $2,200,000.00.

* * * *

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^[1] Count 1 of the Information alleged that the defendants violated 24 F.S.M.C. 501(1)(a) & (c) by engaging in "fishing activities in the FSM Exclusive Economic Zone without a valid and applicable fishing permit." The count was dismissed voluntarily after the FSM Attorney General discovered that the Vessel was in fact operating pursuant to a valid permit.

^[2] On September 21, 1994, the Court issued an Order releasing the individual defendants from detention and instructing those defendants that they were required to appear for trial. In an amended Order for release, dated October 21, 1994, all defendants agreed that, in exchange for the release of the Vessel in this case, Ting Hong would serve as a designated service agent for all defendants. The purpose of this designation was to ensure that the individual defendants were apprised of the status of the case and to guarantee their appearance at trial. Despite their agreement, defendant Ting Hong did not apprise the individual defendants of the progress of the case and they did not appear for trial.

^[3] According to the testimony of Craig Heberer, the HMTCs are a set of standardized rules for fishing operations. The HMTCs are required to be included in FSM foreign fishing agreements by regional multinational treaties and agreements of which the FSM is a member, including the Forum Fishery Agency ("FFA"), and the South Pacific Commission ("SPC"). The FFA member countries are required to enforce the HMTCs because they are part of the FSM's regional and international treaty obligation, the purposes of which are to create uniform standards for fishing operations within the designated region, to assist in the enforcement of domestic fishing laws, and to enhance the effective management of resources by providing statistics needed by the FFA, the SPC, and the member countries to monitor the regional fishery resource. Only by conforming its practices within the FSM EEZ to the rules and regulations of regional and international bodies, including the FFA, the SPC, and the UN Convention on the Law of the Sea of which the FSM is also a member, does it become possible for the FSM and other countries to guard against depletion and over fishing while simultaneously ensuring the benefits of harvesting fishery resources within their maximum sustainable yields.

^[4] The boarding officers also were unable to obtain any information from the eleven crew members, because, as confirmed by Lola Wang, none of them were capable of communicating in English.

^[5] The Government was the only party to introduce eyewitness testimony relating to the events that occurred during the routine inspection of the Vessel on August 24, 1994. To the extent that the Court found that testimony to be credible and unimpeached, the Court accepted that testimony as a true account of the events of that day and included that testimony in the findings of fact set forth above.

^[6] Liability under section 301 of Title 11 is not limited to situations where one individual explicitly agrees to accept the legal obligation of preventing another from committing a crime. Even ignoring, for a moment, the provisions of the foreign fishing agreement in which Ting Hong agreed to ensure that the operators of Ting Hong licensed vessels complied with applicable FSM law, the facts of this case plainly establish Ting Hong's legal duty to do so. As stated above, Ting Hong negotiated and entered into the foreign fishing agreement with MMA. The agreement states that it was entered into for the benefit of Ting Hong, and that, under its terms, Ting Hong would be permitted to bring up to 270 Ting Hong vessels into the FSM. The agreement does not concern itself with the arrangements that Ting Hong may make with the 270 vessels that it brings into the FSM, because for purposes of the agreement between Ting Hong and MMA and the liability that may arise under that agreement, each of the 270 vessels is a "Ting Hong vessel" regardless of whether they are actually owned by Ting Hong.

^[7] Although the Court cites to foreign sources on this point, these sources merely reinforce the law contained in Title 24 and Title 11 of the FSM Code. Accordingly, the Court finds that the law contained in these citations is applicable to the unique conditions that exist within the FSM, and that it is therefore proper for the Court to make reference to these citations. See, e.g., Semens v. Continental Air Lines, Inc. (I), [1985] FMSC 3; 2 FSM Intrm. 131, 140 (Pon. 1985) (recognizing that foreign law is an appropriate source for this Court to consider, provided that those sources are consistent with "pertinent aspects of Micronesian society and culture").
^[8] Although the Government admits that the Vessel has a valid permit, the Government nonetheless contends that the defendants were in violation of section 105 because they failed to comply with other provisions of Title 24. Thus, according to the Government's interpretation of section 105, that section defines authorization as requiring both that defendants both have a valid permit and that they comply with all applicable FSM laws.

The Court does not agree with the Government's interpretation of section 105. While other sections of Title 24 do contain language that comports with the Government's interpretation, see, e.g., 24 F.S.M.C. 501(1)(l) (finding there to be a violation if the actor takes, transports, or possesses fish while also violating another provisions of Title 24 or of "any regional fishing treaty, regulation, permit, foreign or domestic-based fishing agreement or any applicable law"), section 105 contains no such language. Section 105 merely states that a vessel must properly stow its fishing gear except "when such vessel is in an area in which it is authorized to fish in accordance with Title 24.

The general rule of statutory interpretation is that the plain meaning of a statutory provision must be given effect whenever possible. Setik v. FSM, [1992] FMSC 19; 5 FSM Intrm. 407, 410 (App. 1992). Relatedly, in cases where the plain meaning of two statutes differs, the Court also must assume that Congress did so intentionally and with reason. The language of section 105, unlike that of section 501(1)(l), is that this vessel need not have its gear stowed provided that it was authorized to fish in the particular area. Accordingly, provided that a vessel is operating in the FSM Exclusive Economic Zone pursuant to a valid permit, that vessel's fishing gear need not be stowed in a manner stated in section 105.

^[9] Although the Vessel's permit prohibits the Vessel from fishing "within 12 miles of the Federated States of Micronesia" unless authorized by the State in question, there was no suggestion by the Government that defendants were operating within 12 miles of the coast of any of the FSM States.

^1[0] Prior to trial, and throughout the liability phase of the trial, each of the defendants in this case were represented by the Law Office of John Brackett. At the sentencing phase of the trial, however, defendant Ting Hong retained the legal services of the Law Offices of R. Barrie Michelsen in place of original counsel. The individual defendants did not appear at the sentencing phase of the trial and have not presented the Court with any indication as to their present counsel. As a result, the individual defendants have yet to be sentenced in this case.
^[1]1 Section 101 of Title 24 of the Code of the Federated States of Micronesia, entitled "Statement of Purpose," is the clearest indication of Congress' impressions regarding the importance of the marine resource to the welfare and viability of the Federated States of Micronesia. In its entirety, section 101 states as follows:

§ 101. StatemenPurpose.

The living resources of the sea around Micronesia are a finite but renewable part of the physical heritf the people of Micronesia. As Micronesia is nearly devoid of land-based resources, the sehe sea provides the only feasible means for the development of economic viability necessary to provide the foundation for political stability. The resources of the sea around Micronesia are being heavily exploited by the citizens of other nations without benefit to the people of Micronesia. Catch statistics indicate that certain reef and highly migratory stocks of fish may be threatened with irreversible diminution by reckless and excessive exploitation, thus threatening the material advancement and ultimately the political viability and stability of Micronesia. The purpose of this title is to promote economic development and to manage and conserve Micronesia's vital sea resources by means of the extension of the fishery jurisdiction of Micronesia out two hundred miles from its shores.

^1[2] In noting the relative ineffectiveness of the present FSM surveillance program, the Government stressed the need for high penalties as a tool to combat and deter illegal fishing until the FSM is capable of mounting a more effective surveillance and enforcement campaign.

^1[3] Although the Court is concerned with evidence of a pattern of wrongdoing on the part of Ting Hong and its vessels, the Court did not consider Ting Hong's alleged acts of bribery in Palau in its sentencing decision, since defendant Ting Hong indicated at sentencing that those charges already had been dismissed.

^1[4] Although defendants filed a number of pre-trial motions raising constitutional challenges, including one in which they claimed that the fines mandated by Title 24 were unconstitutionally excessive, the excessive fines claim was denied as premature. FSM v. Cheng Chia-W (I), [1995] FMSC 20; 7 FSM Intrm. 124, 126 (Pon. 1995). Because the defendants failed to re-raise this claim at an appropriate time, the trial division was never given the opportunity to review the merits of that claim. For identical reasons, the Court also never had the opportunity to consider the merits of defendants' claim that the filing of both criminal and civil forfeiture claims based on the same alleged conduct was a violation of the prohibition against double jeopardy. Id. at 128. The one constitutional challenge that the Court did consider, and reject, was defendants' claim that Title 24 "wrongfully and unconstitutionally" delegates to the MMA, the authority to define criminal violations of that Title. Id. at 127.

^1[5] A careful reading of section 1002 reveals that it does not apply to sentences involving mandatory minimum penalties. According to section 1002, probation may be imposed where the "Court finds that the ends of justice and the best interests of the public and the defendant do not require that the maximum sentence permitted by law be imposed on a person convicted of a crime." 11 F.S.M.C. 1002 (emphasis added). In this case, however, the Court is not imposing the "maximum sentence permitted by law." Quite the contrary, the Court's sentence is nearly the minimum sentence required by law.