Carlos Etscheit Soap Company Inc v Gilmete [2001] FMSC 38; 10 FSM Intrm. 436 (Pon. 2001) (23 October 2001)

FEDERATED STATES OF MICRONESIA
SUPREME COURT TRIAL DIVISION

Cite as Carlos Etscheit Soap Co. vs. Gilmete[2001] FMSC 38; ,
10 FSM Intrm. 436 (Pon. 2001)

[2001] FMSC 38; [10 FSM Intrm. 436]

CARLOS ETSCHEIT SOAP COMPANY INC.,
YVETTE ETSCHEIT ADAMS, and RENEE
ETSCHEIT VARNER,
Plaintiffs,

vs.

IOANES GILMETE and BERNATETA GILMETE
a/k/a TERESIDA GILMETE, JOHN DOES 1-20
and JANE DOES 1-20
Defendants.

CIVIL ACTION NO. 2000-002

ORDER

Andon L. Amaraich
Chief Justice

Decided: October 23, 2001

APPEARANCES:

For the Plaintiffs:
Fredrick L. Ramp, Esq.
Law Office of Fredrick L. Ramp
P.O. Box 1480
Kolonia, Pohnpei FM 96941

For the Defendants:
Joseph S. Phillip, Esq.
P.O. Box 464
Kolonia, Pohnpei FM 96941

* * * *

HEADNOTES

Civil Procedure ; Default and Default Judgments
When a party against whom a judgment for affirmative relief is sought has failed to plead or

[10 FSM Intrm. 437]

otherwise defend and that fact is made to appear by affidavit or otherwise, the clerk shall enter that party's default, but when the plaintiff did not seek a default, no default is entered. Carlos Etscheit Soap Co. v. Gilmete, [2001] FMSC 38; 10 FSM Intrm. 436, 439 (Pon. 2001).

Civil Procedure ; Default and Default Judgments
Under proper circumstances, default judgments will be vacated so that cases can be decided on their merits and when only a default has been entered, the policy in favor of vacating the default and deciding the case on its merits is even stronger. Logically, the policy in favor of deciding a case on its merits when no default has been entered and the answer merely filed late must be much stronger. Carlos Etscheit Soap Co. v. Gilmete, [2001] FMSC 38; 10 FSM Intrm. 436, 439 (Pon. 2001).

Civil Procedure ; Default and Default Judgments
Having to prosecute a case when the defendants filed and served their answer only days late, is not the type of prejudice that would allow a plaintiff to prevail while avoiding the case being decided on its merits. Public policy favors court judgments be on the merits. Carlos Etscheit Soap Co. v. Gilmete, [2001] FMSC 38; 10 FSM Intrm. 436, 439 (Pon. 2001).

Civil Procedure ; Default and Default Judgments
When no default has already been entered against a defendant and that defendant has filed a late response clearly indicating an intention to defend against the plaintiff's claim, the court, in the interest of deciding the case on the merits, will not enter a default against that defendant. Carlos Etscheit Soap Co. v. Gilmete, [2001] FMSC 38; 10 FSM Intrm. 436, 439 (Pon. 2001).

Civil Procedure ; Pleadings
Late filed responsive pleadings will not be stricken when the plaintiffs have failed to show any prejudice from defendants' failure to respond within 20 days of service of the plaintiffs' complaint and when the policy of deciding cases on the merits outweighs the prejudice to plaintiffs, but the defendants will be required to amend their responsive pleadings and file responses to plaintiffs' complaint that comply with Rule 8(b). Carlos Etscheit Soap Co. v. Gilmete, [2001] FMSC 38; 10 FSM Intrm. 436, 439-40 (Pon. 2001).

Civil Procedure ; Default and Default Judgments
When a court has denied the plaintiffs' motion to strike defendants' responsive filings, and also denied the plaintiffs' motion to enter defaults, the court cannot enter a judgment by default against the defendants. Carlos Etscheit Soap Co. v. Gilmete, [2001] FMSC 38; 10 FSM Intrm. 436, 440 (Pon. 2001).

Civil Procedure ; Pleadings
The court will grant defendants leave to amend their responsive pleadings when one defendant has not stated in short and plain terms her defenses to each claim asserted and has not admitted nor denied the plaintiffs' averments rely and the other defendant had not obtained leave to amend his answer, so the court could not permit him to avail himself of the affirmative defenses filed later. Carlos Etscheit Soap Co. v. Gilmete, [2001] FMSC 38; 10 FSM Intrm. 436, 440 (Pon. 2001).

* * * *

COURT'S OPINION

ANDON L. AMARAICH, Chief Justice:

This matter comes before the court on plaintiffs' motion for issuance of entries of default by clerk of court; motion to strike; and motion for entry of judgment by default, filed on April 4, 2001.

[10 FSM Intrm. 438]

An opposition to plaintiffs' motion was filed on April 10, 2001. For the reasons stated herein, the court will deny plaintiffs' motions, and will require defendants to file appropriate responses to plaintiffs' complaint within 20 days of the date of entry of this order.

Background

On January 26, 2000, plaintiffs filed a complaint against defendant alleging a cause of action for trespass. Plaintiffs allege that defendants are occupying land owned by plaintiffs without the consent of plaintiffs. The complaint states that defendants leased from plaintiffs the land now occupied by defendants in 1985 for a period of five years; at the end of the five-year term, defendants did not renew their lease but continued to occupy the premises. The complaint further states that defendants presently occupy an area larger than that which was originally leased to them and are using the premises for purposes beyond the scope of the original lease. Plaintiffs allege they have made repeated demands on defendants to remove themselves and their property from plaintiffs' land, but defendants have refused to do so.

On February 16, 2000, defendant Ioanes Gilmete, appearing pro se, filed an answer to plaintiffs' complaint (the "February 16, 2000 filing"). On March 27, 2001, Joseph S. Phillip, apparently attempting to appear on behalf of Ioanes Gilmete and Bernateta Gilmete a/k/a Terisida Gilmete ("Bernateta Gilmete"), filed an untitled document (the "March 27, 2001 filing") which asserts six affirmative defenses to plaintiffs' claim. The March 27, 2001 filing does not admit or deny the averments upon which plaintiffs rely in the complaint. Also, no request for leave of court was ever sought by Ioanes Gilmete to amend his answer, nor was leave ever granted to Ioanes Gilmete to amend his answer to include the six affirmative defenses in the March 27, 2001 filing.

Since the complaint was filed on January 26, 2000, pursuant to FSM Civil Rule 12(a) a response was due no later than February 15, 2000. Ioanes Gilmete's answer, filed February 16, 2000, was filed one day after the time period allowed. Bernateta Gilmete did not respond to plaintiffs' complaint until March 27, 2001, over a year after a response was due. Therefore, she was technically in default for over one year. However, plaintiffs never requested that the court enter defaults of the defendants, and the court did not enter the default of either defendant.

1. Motion for Issuance of Entries of Default.

On April 4. 2001, plaintiffs filed a motion for issuance of entries of default by clerk of court ("motion for default"); a motion to strike; and a motion for entry of judgment by default. Plaintiffs seek to have defaults entered against both Ioanes Gilmete and Bernateta Gilmete. Plaintiffs also request that the court strike the February 16, 2000 filing and the March 27, 2001 filing. Plaintiffs request that, if the two previous motions are granted, the court enter judgment by default against the defendants.

Plaintiffs argue that neither defendant answered or otherwise responded to the complaint within the 20 day period set forth in FSM Civil Rule 12. Since the complaint was filed and served on January 26, 2000, a timely answer should have been filed on served no later than February 15, 2000. Since no response to plaintiffs' complaint was filed within the time frame contemplated by the Rules, defendants were in default.

On April 10, 2001, defendants filed an opposition to plaintiffs' motions (the "opposition"). The opposition states that Ioanes Gilmete had his answer prepared by Micronesian Legal Services on behalf of himself and his wife, Bernateta Gilmete. Defendants argue that under Micronesian Customs and Tradition, it is common knowledge that the husband can represent the interest of the wife in matters affecting their common interests. The opposition maintains that at the very least, the February 16,

[10 FSM Intrm. 439]

2001 filing shows a clear intention on the part of the defendants to defend against plaintiffs' claim.

The opposition does not explain why February 16, 2000 filing purports to be Ioanes Gilmete acting pro se and does not explain why a responsive pleading was not filed on behalf of Bernateta Gilmete at the same time. Nor does the opposition explain why leave of court was not sought to amend Ioanes Gilmete's February 16, 2000 pleading to include the affirmative defenses in the March 27, 2001 filing.

Rule 55(a) of the FSM Rules of Civil Procedure provides that when a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend as provided by these rules and that fact is made to appear by affidavit or otherwise, the clerk shall enter that party's default. (Emphasis added.) In the present case, default was not sought by plaintiff as to either defendant, nor was default entered against either defendant.

In Medabalmi v. Island Imports Co., [2001] FMSC 53; 10 FSM Intrm. 32 (Chk. 2001), the court stated as follows:

"[M]otions under Rule 12(f) [motions to strike] are viewed with disfavor and are infrequently granted." Courts ordinarily favor resolving cases on their merits rather than on procedural grounds. Under proper circumstances, default judgments will be vacated so that cases can be decided on their merits. When only a default has been entered, the policy in favor of vacating the default and deciding the case on its merits is even stronger. Logically, the policy in favor of deciding a case on its merits when no default has been entered and the answer merely filed a few days late must be much stronger.

The defendants raise a number of defenses, which, if proven, could negate some, or all, of the relief plaintiffs seek. Except for having to prosecute the case, which they were, presumably, prepared to do if the answer had been filed four days earlier, the plaintiffs have not claimed nor shown any prejudice to them by the defendants' serving their answer three days late, and filing it four days late. That is not the type of prejudice that would allow a plaintiff to prevail while avoiding the case being decided on its merits. Public policy favors court judgments be on the merits.

Medabalmi, 10 FSM Intrm. at 35 (citations omitted).

It appears the defendants were technically in default; Ioanes Gilmete for one day and Bernateta Gilmete for over one year. However, plaintiffs did not request that the court enter their defaults. And the court never entered the default of the defendants. The court believes the February 16, 2000 filing is a clear intention on the part of Ioanes Gilmete alone to defend against plaintiffs' complaint. In the interests of deciding this case on the merits, and since plaintiffs have failed to establish any prejudice due to Ioanes Gilmete's filing his answer one day after the time provided in Rule 12(a), the court will not enter default against Ioanes Gilmete.

However, the court does not believe the February 16, 2000 filing is a clear intent on the part of Bernateta Gilmete to defend against plaintiffs' complaint. The February 16, 2000 filing simply does not contain language that would indicate an intention on Bernateta Gilmete's part to defend against the allegations in plaintiffs' complaint. However, it appears that the March 27, 2001 filing clearly indicates an intention on Bernateta Gilmete's part to defend against plaintiffs' claim. And since no default was entered against Bernateta Gilmete, even though her response to plaintiffs' complaint was filed significantly late, in the interest of deciding the case on the merits the court will not enter default against Bernateta Gilmete.

[10 FSM Intrm. 440]

2. Motion to Strike

Plaintiffs argue both the February 16, 2000 filing and the March 27, 2001 filing should be stricken from the record in this matter. Plaintiffs argue that since the February 16, 2000 filing was filed one day after the 20-day time period, it was filed untimely and should be stricken. As to the March 27, 2001 filing, it should be stricken for several reasons. First, since it was filed over one year after the time to plead in response to plaintiffs' complaint, it is untimely as Bernateta Gilmete's answer. Also, it does not admit or deny the averments upon which plaintiffs rely. As to Ioanes Gilmete, if the March 27, 2001 is an attempt to amend the February 16, 2000 filing to include affirmative defenses, it is improper since leave of court was never obtained to amend his answer.

Plaintiffs are correct that defendants were technically in default when no responsive pleading was filed to plaintiffs' complaint within the time frame set forth in Rule 12(a). Plaintiffs are also correct that the March 27, 2001 filing fails to comply with Rule 8(b), nor was leave of court obtained to amend Ioanes Gilmete's February 16, 2000 filing. Ioanes Gilmete filed an answer on his own behalf on February 16, 2001, one day after the time period set forth in FSM Civil Rule 12(a). And the March 27, 2001 pleading, purporting to be filed on behalf of both defendants, was filed over one year after the date a response to plaintiffs' complaint would have been due for Bernateta Gilmete. However, the court finds believe that in this case, as in Medabalmi, supra, the policy of deciding cases on the merits outweighs the prejudice to plaintiffs from defendants' failure to comply with Rule 12(a). In fact, plaintiffs have failed to show any prejudice from defendants' failure to respond to plaintiffs' complaint within 20 days of service of the complaint. Therefore, the court will deny plaintiffs' motion to strike. However, defendants will be required to amend their responsive pleadings and file responses to plaintiffs' complaint that comply with Rule 8(b) (see below).

3. Motion for Entry of Judgment by Default

Since the court will deny plaintiffs' motion to strike the February 16, 2000 and March 27, 2001 filings, and also deny plaintiffs' motion to enter the default of both defendants, the court cannot enter judgment by default against the defendants. Therefore, plaintiffs' motion for entry of judgment by default will also be denied.

Even though the court will deny plaintiffs' motions, the court will still require defendants to file responses to plaintiffs' complaint that comply with FSM Civil Rule 8(b). Bernateta Gilmete has not stated in short and plain terms her defenses to each claim asserted and has not admitted nor denied the averments upon which plaintiffs rely. Further, leave of court was not obtained by Ioanes Gilmete to amend his answer, so at the present time the court cannot permit him to avail himself of the affirmative defenses contained in the March 27, 2001 filing. The court now grants defendants leave of court to amend their responsive pleadings. The court orders defendants to file appropriate responses to plaintiffs' complaint within 20 days of the date of entry of this order.

Therefore, it is hereby ordered that:

(1) Plaintiffs' motion for issuance of entries of default is DENIED.

(2) Plaintiffs' motion to strike is DENIED.

(3) Plaintiffs' motion for entry of judgment by default is DENIED.

(4) Defendants are ordered to file appropriate responses, in compliance with FSM Civil Rule 8(b), to plaintiffs' complaint within 20 days of the date of entry of this order.