Kaminanga v FSM College of Micronesia [1998] FMSC 26; 8 FSM Intrm. 438 (Chk. 1998) (4 September 1998)

FEDERATED STATES OF MICRONESIA
SUPREME COURT TRIAL DIVISION
Cite as Kaminanga v FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438 (Chk. 1998)

KIOMASA KAMINANGA
d/b/a KIOMASA ENTERPRISES,
Plaintiff,

vs.

FSM COLLEGE OF MICRONESIA
CHUUK CAMPUS and its Director,
GRACEFUL ENLET, in his official capacity,
and the FSM COLLEGE OF MICRONESIA SYSTEM,
Defendants

CIVIL ACTION NO. 1998-1002

ORDER

Richard H. Benson
Associate Justice

Decided: September 4, 1998

APPEARANCES:

For the Plaintiff:
Wesley Simina, Esq.
P.O. Box 94
Weno, Chuuk FM 96942

For the Defendant:
Angela M. Belgrove, Esq.
Chief of Litigation
FSM Department of Justice
P.O. Box PS-105
Palikir, Pohnpei FM 96941

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HEADNOTES

Attorney, Trial Counselor and Client - Disqualification of Counsel
Model Rule 1.9 is inapplicable to cases where an attorney is representing two clients at the same time because it applies to a conflict arising from the representation of a former client. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 440 (Chk. 1998).

Attorney, Trial Counselor and Client - Disqualification of Counsel
Model Rule 1.7(b) allows representation of multiple clients if the lawyer reasonably believes his representation will not be adversely affected, and the client consents after consultation. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 440 (Chk. 1998).

Attorney, Trial Counselor and Client - Disqualification of Counsel
Model Rule 1.11(c) contemplates successive private and government employment so long as the lawyer does not participate in a matter in which he participated personally and substantially while in private practice so when steps have been taken to insure that a government lawyer would do no work related to his private employment the Model Rules have been complied with. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 440-41 (Chk. 1998).

Civil Procedure - Motions
An enlargement of time to oppose a motion may be granted when the mail service has been delayed and erratic. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 441 (Chk. 1998).

Civil Procedure - Joinder; Civil Procedure - Parties
A branch campus of the College of Micronesia-FSM does not have the capacity to sue or be sued on its own and will be dismissed from an action where the College of Micronesia-FSM, a public corporation, is a party. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 441 (Chk. 1998).

Civil Procedure - Parties
Natural persons generally have the capacity to sue or be sued. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 442 (Chk. 1998).

Agency; Civil Procedure - Joinder
An agent and principal may be sued in the same action for the same cause of action even when the principal's liability is predicated solely on the agency. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 442 (Chk. 1998).

Torts - Negligence
Under Chuuk state law the elements of actionable negligence are the breach of a duty on the part of one person to protect another from injury, and that breach is the proximate cause of an injury to the person to whom the duty is owed. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 442 (Chk. 1998).

Torts - Negligence
A negligence claim may be stated when a party has breached its duty to negotiate in good faith. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 442 (Chk. 1998).

Torts - Fraud
In Chuuk, the elements of fraud or intentional misrepresentation are: 1) a misrepresentation by the defendant, 2) scienter or the defendant's knowledge that the statements were untrue, 3) intent to cause the plaintiff to rely on the misrepresentations, 4) causation or actual reliance by the plaintiff, 5) justifiable reliance by the plaintiff and 6) damages. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 442 (Chk. 1998).

Torts - Fraud
Actions or conduct, as well as words, can constitute the necessary misrepresentation for fraud. In some cases, the misrepresentations may be made by a failure to disclose information. Kaminanga v. FSM College of Micronesia, [1998] FMSC 26; 8 FSM Intrm. 438, 443 (Chk. 1998).

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COURT'S OPINION

RICHARD H. BENSON, Associate Justice:

I have before me two motions, both filed by the defendants. The Defendants' Joint Motion to Disqualify Plaintiff's Counsel is denied, and their Motion to Dismiss Complaint is granted in part and denied in part. My reasons follow. The motion to disqualify is considered first because if it were granted then the plaintiff's opposition to the other motion would have to be stricken.

I. Motion to Disqualify Plaintiff's Counsel

The defendants jointly moved to disqualify plaintiff's counsel, Wesley Simina, on the ground that his contract employment with the FSM Congress where he was assigned to serve as counsel for the Health, Education and Social Affairs Committee for Congress's May and June 1998 session constituted an impermissible conflict of interest under Rules 1.7(b) and 1.9 of the Model Rules of Professional Conduct. I conclude that it does not and deny the motion. My reasons follow.

Model Rule 1.9 is inapplicable because it applies to a conflict arising from the representation of a former client. The plaintiff and Congress were both clients at the same time.

Model Rule 1.7(b) allows representation if the lawyer reasonably believes his representation will not be adversely affected, FSM MRPC R. 1.7(b)(1), and the client consents after consultation, FSM MRPC R. 1.7(b)(2). Mr. Simina has consulted his Congressional clients and they have consented. It is not shown whether he has consulted the plaintiff in this case. The defendants, however, have not indicated how Mr. Simina's representation of the plaintiff might be adversely affected by his work for Congress. Nor can I see how it might be. Furthermore, this situation is contemplated by the Model Rules. Model Rule 1.11(c) contemplates successive private and government employment so long as the lawyer does not participate in a matter in which he participated personally and substantially while in private practice. FSM MRPC R. 1.11(c)(1). Both the Committee Chairman and the Congressional Legislative Counsel are aware of Mr. Simina's representation in this matter and have taken steps to insure that Mr. Simina would do no work related to the FSM College of Micronesia System. I therefore conclude that the Model Rules have been complied with. The motion to disqualify is therefore denied.

II. Motion to Dismiss

The defendants' motion to dismiss raised several grounds - that the only proper party defendant was the College of Micronesia-FSM so the other defendants were entitled to dismissal; that the plaintiff failed to allege facts sufficient to state a cause of action for negligence or for fraud so that both the negligence and fraud claims should be dismissed; and that the complaint should be dismissed for failure to comply with the statutory requirement for service on the College of Micronesia set forth in Public Law No. 7-79, section 24(1) (to be codified at 40 F.S.M.C. 724(1)). The defendants have since withdrawn the insufficiency of process ground because the plaintiff has cured the defective service. The defendants also urge that the plaintiff's opposition to their motion be disregarded as untimely filed.

A. Timeliness of Opposition

The dismissal motion was filed and served by mail on May 4, 1998. Starting shortly thereafter, plaintiff's counsel was, as evidenced by the defendants' motion to disqualify, serving as a legislative counsel while Congress was in session at the capitol in Palikir, Pohnpei. Furthermore, it took one month for the original to arrive at the clerk's office on Chuuk for filing. The opposition, which was also filed by mail from Pohnpei, took almost three weeks to arrive at the clerk's office. (It was served on the defendants by hand delivery at Palikir before the motion it opposed had arrived on Chuuk for filing.) And also considering that this all took place while Continental Airlines was making frequent changes in its flight schedule and, as a result, mail delivery was erratic, I hereby grant an enlargement of time for the plaintiff to oppose the dismissal motion and will therefore consider the opposition's contents.

B. The Chuuk Campus and its Director as Parties

The defendants' motion seeks dismissal of all claims against FSM College of Micronesia Chuuk Campus and its director, Graceful Enlet, on the grounds that the Chuuk Campus is not a legal entity that may sue or be sued and that it follows from this that its director cannot be sued either. The plaintiff contends that because the statute creating the College of Micronesia-FSM states that it is "subject to suit only in the manner provided for and to the extent that suits may be brought against the National Government of the Federated States of Micronesia," Pub. L. No. 7-79, § 24(1) (to be codified at 40 F.S.M.C. 724(1)), and because suits have, in the past, been brought against various national government cabinet departments andcials instead of the national government itself, he ought to be able to sue the Chuuk CampuCampus and its director, as well as the College of Micronesia-FSM, especially since the Chuuk Campus and its director were the "main players" in the events giving rise to this case.

The College of Micronesia-FSM was created as a public corporation, Pub. L. No. 7-79, § 23(1) ( codified at 40 F.S. F.S.M.C. 723(1)), with the capacity to sue and be sued in its corporate name, id. § 23(6) e cod at 40 F.S.M.C. M.C. 723(6)). It is a party to this action. No separate legal identityntity or authority was granted to the Chuupus or to any part of the College system. I therefore conclude that the Chuuk Campus does noes not have the capacity to sue or be sued on its own and therefore must be dismissed from the action. Cf. Laxalt v. McClatchy, 622 F. Supp. 737, 740-41 (D. Nev. 1985) (dismissal of three newspapers that were not separate corporations but merely subsidiary d.b.a.'s of corporate defendant which was the real party in interest). The College of Micronesia-FSM is the real party in interest. The Chuuk Campus is hereby dismissed.

Graceful Enlet, the director of the Chuuk Campus, is a natural person. Natural persons generally have the capacity to sue or be sued. From the complaint's factual allegations it appears that the plaintiff claims that Enlet acted as an agent for the College of Micronesia-FSM. An agent and principal may be sued in the same action. See, e.g., Bailey v. Zlotnick, 133 F.2d 35, 37 (D.D.C. 1943) (under Civil Procedure Rule 20(a) principal and agent may be sued together for same cause of action even when principal's liability is predicated solely on the agency). The motion is therefore denied as to Graceful Enlet.

C. Negligence and Fraud Claims

The plaintiff's complaint alleges five causes of action. The defendants seek dismissal of two of them for failure to allege sufficient facts to state a cause of action for negligence or for fraud. A Civil Rule 12(b) motion "to dismiss for failure to state a claim may be granted only if it appears to a certainty that no relief could be granted under any state of facts which could be proven in support." Faw v. FSM, 6 FSM Intrm. 33, 37 (Yap 1993).

1. Negligence

"Under Chuuk state law the elements of actionable negligence are 'the breach of a duty on the part of one person to protect another from injury,' and that breach is the proximate cause of 'an injury to the person to whom the duty is owed.'" Fabian v. Ting Hong Oceanic Enterprises, 8 FSM Intrm. 63, 65 (Chk. 1997) (quoting Ludwig v. Mailo, [1992] FMCSC 1; 5 FSM Intrm. 256, 259 (Chk. S. Ct. Tr. 1992)). The defendants contend that the plaintiff has failed to allege any facts that would give rise to an actionable duty of care by any of the defendants.

Among the plaintiff's allegations are these: that the defendants negotiated with the plaintiff to lease his property to relocate the College of Micronesia-FSM Chuuk Campus there; that the defendants knew that the leases for the current College of Micronesia-FSM Chuuk Campus contained restrictions that would make it difficult or impossible to get out of; that the defendants knew that there was no funding to move the Chuuk Campus to the plaintiff's property; that, relying on the negotiations, the plaintiff made renovations and other changes in his building's use; and that a reasonable person would have revealed these circumstances before the landowner had undertaken expenditures with the defendants' consent. The essence of the plaintiff's negligence claim is that the defendants breached a duty to negotiate in good faith. The plaintiff alleges that the defendants' true intent in engaging in negotiations with the plaintiff was to force their current landlords to comply with their maintenance and other obligations under the current lease. I therefore conclude that there exists a state of facts, which, if proven, would entitle the plaintiff to prevail on this claim. The defendants' motion to dismiss must therefore be denied as to the plaintiff's negligence claim.

2. Fraud

In Chuuk, the elements of fraud or intentional misrepresentation are: 1) a misrepresentation by the defendant, 2) scienter or the defendant's knowledge that the statements were untrue, 3) intent to cause the plaintiff to rely on the misrepresentations, 4) causation or actual reliance by the plaintiff, 5) justifiable reliance by the plaintiff and 6) damages. Eram v. Masaichy, [1995] FMCSC 9; 7 FSM Intrm. 223, 225 (Chk. S. Ct. Tr. 1995). See also Pohnpei v. Kailis, [1994] FMSC 12; 6 FSM Intrm. 460, 462 (Pon. 1994). The defendants contend that the plaintiff has not alleged any facts to show that the defendants made any misrepresentations.

A fair reading of the complaint's allegations is that the plaintiff alleges that the defendants represented that they were ready, willing, and able to move onto the plaintiff's property in the near future. The plaintiff contends, as evident from the plaintiff's allegations listed in the previous section, that the defendants misrepresented their willingness and their ability to move the Chuuk Campus to the plaintiff's property. The plaintiff also alleges that the defendants directed, instructed and inspected the renovations he made to his premises in preparation for relocating the Chuuk Campus there. Actions or conduct, as well as words, can constitute the necessary misrepresentation. W. Page Keeton et al., Prosser and Keeton on the Law of Torts § 106, at 736 (5th ed. . Furt Furthermore, in some cases, the misrepresentations may be made by a failure to disclose information. Id. at 738-39. I therefore conclude that the plaintiff has alleged a state of facts, which, if proven, would entitle him to prevail on a fraud cause of action. The defendants' motion to dismiss must therefore be denied as to the plaintiff's fraud claim.

III. Conclusion

Accordingly, the defendants' motion to disqualify the plaintiff's counsel is denied. The FSM College of Micronesia Chuuk Campus is hereby dismissed as a party. Its name shall not appear in the caption of any future papers filed in this action. The motion to dismiss Graceful Enlet as a party defendant is denied. The motion to dismiss the plaintiff's negligence and fraud claims is also denied.

The parties shall submit by October 15, 1998, their proposed dates for the completion of discovery, for filing pretrial motions and (about 15-20 days thereafter) for hearing those motions.