Gilmete v Carlos Etscheit Soap Company [2005] FMSC 2; 13 FSM Intrm. 145 (App. 2005) (9 February 2005)

FEDERATED STATES OF MICRONESIA
SUPREME COURT APPELLATE DIVISION
Cite case as Gilmete v Carlos Etscheit Soap Company, [2005] FMSC 2; 13 FSM Intrm. 145 (App. 2005)

IOANIS GILMETE and BERNADETA GILMETE, a/k/a TERESIDA GILMETE,
Appellants,

vs.

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

_______________________________________________

APPEAL CASE NO. P4-2002
(Civil Action No. 2000-002)

BEFORE:

Hon. Martin G. Yinug, Associate Justice, FSM Supreme Court
Hon. Judah C. Johnny, Specially Assigned Justice, FSM Supreme Court*
Hon. Yosiwo P. George, Specially Assigned Justice, FSM Supreme Court**

*Chief Justice, Pohnpei Supreme Court, Kolonia, Pohnpei
**Chief Justice, Kosrae State Court, Lelu, Kosrae

Argued: August 11, 2004
Decided: February 9, 2005

APPEARANCES:

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

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

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HEADNOTES

Jurisdiction - Arising under National Law; Jurisdiction - Diversity
Section 6(b) of Article XI of the FSM Constitution provides that the national courts, including the Supreme Court trial division, have concurrent original jurisdiction in cases arising under the 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 citizen thereof, and a foreign state, citizen, or subject. The national courts referred to in this section are the FSM Supreme Court trial division and any other national courts which may be established in the future. Gilmete v. Carlos Etscheit Soap Co., [2005] FMSC 2; 13 FSM Intrm. 145, 147 (App. 2005).

Jurisdiction - Exclusive FSM Supreme Court
In contrast to Section 6(b), Section 6(a) of Article XI provides that the Supreme Court trial division has original and exclusive jurisdiction in cases affecting officials of foreign governments, disputes between states, admiralty or maritime cases, and in cases in which the national government is a party except where an interest in land is at issue. Section 6(a) names four different types of cases: 1) those affecting officials of foreign governments; 2) those involving disputes between states; 3) those that are admiralty or maritime in character; and 4) those where the national government is a party. Gilmete v. Carlos Etscheit Soap Co., [2005] FMSC 2; 13 FSM Intrm. 145, 148 (App. 2005).

Jurisdiction - Exclusive FSM Supreme Court
Section 6(a) carves out a specific exception for cases involving land - the trial division has original and exclusive jurisdiction in cases in which the national government is a party except where an interest in land is at issue. Or to cast this as a negative, the trial division does not have original and exclusive jurisdiction in a case in which the national government is a party and an interest in land is at issue. Gilmete v. Carlos Etscheit Soap Co., [2005] FMSC 2; 13 FSM Intrm. 145, 148 (App. 2005).

Jurisdiction - Diversity; Jurisdiction - Exclusive FSM Supreme Court
Section 6(a) contains a single jurisdictional exception limited in scope to a case involving the national government as a party. In contrast, Section 6(b) contains no exception of any kind. This admits of no conclusion other than the obvious one: the Framers intended that the limited exception stated in Section 6(a) apply to cases involving an interest in land in which the national government is a party, and with equal force intended that no such exception apply to any of the kinds of cases specified in Section 6(b). Gilmete v. Carlos Etscheit Soap Co., [2005] FMSC 2; 13 FSM Intrm. 145, 148 (App. 2005).

Federalism - Abstention and Certification
The rationale for abstention is that the state court is the better court to decide an issue which involves state powers and particularly strong, identifiable state interests. Gilmete v. Carlos Etscheit Soap Co., [2005] FMSC 2; 13 FSM Intrm. 145, 148 (App. 2005).

Appellate Review - Standard of Review; Judgments
The principle of stare decisis is one of the guiding lights of our jurisprudence, and without a principled and compelling reason for overruling a long line of FSM cases, the court is disinclined to do so. Gilmete v. Carlos Etscheit Soap Co., [2005] FMSC 2; 13 FSM Intrm. 145, 149 (App. 2005).

Constitutional Law - Amendment
An amendment to the Constitution may be proposed by a constitutional convention, popular initiative, or Congress in a manner provided by law. A proposed amendment becomes part of the Constitution when approved by ¾ of the votes cast on that amendment in each of ¾ of the states. These are the only methods by which the Constitution may be amended. Gilmete v. Carlos Etscheit Soap Co., [2005] FMSC 2; 13 FSM Intrm. 145, 149 (App. 2005).

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Constitutional Law - Interpretation
The court cannot amend the Constitution by reading into it language that does not appear in it. To do so would be to amend the Constitution by judicial fiat, a course of action not only plainly inimical to Article XIV, Section 1 of the Constitution, but one upon which the court is constitutionally forbidden from embarking. Gilmete v. Carlos Etscheit Soap Co., [2005] FMSC 2; 13 FSM Intrm. 145, 149-50 (App. 2005).

Jurisdiction - Diversity
The adoption of Committee Proposal No. 01-5 by the Third Constitutional Convention does not act as a check upon the exercise of the FSM Supreme Court’s diversity jurisdiction in land cases because the proposed amendment was not ratified by the people. Gilmete v. Carlos Etscheit Soap Co., [2005] FMSC 2; 13 FSM Intrm. 145, 150 (App. 2005).

Jurisdiction - Diversity
Parties to a dispute within the scope of article XI, section 6(b) have a constitutional right to invoke the jurisdiction of the FSM Supreme Court and it is the solemn obligation of the court and all others within the Federated States of Micronesia to uphold that constitutional right to invoke national court jurisdiction under Article XI, Section 6(b). To accept the contention that the FSM Supreme Court trial division has no jurisdiction in diversity cases involving land would defeat the exercise of that right. The court upholds the right of litigants who fall within the scope of Article XI, Section 6(b) to invoke the FSM Supreme Court’s jurisdiction in cases involving land issues. Gilmete v. Carlos Etscheit Soap Co., [2005] FMSC 2; 13 FSM Intrm. 145, 150 (App. 2005).

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COURT’S OPINION

MARTIN G. YINUG, Associate Justice

This appeal presents a single issue, whether this court has subject matter jurisdiction over a diversity case in which the ownership of land is at issue.

The case comes to this court on an appeal from the trial court’s grant of summary judgment in plaintiffs’ favor on their claims for trespass and injunctive relief. [Carlos Etscheit Soap Co. v. Gilmete, [2002] FMSC 25; 11 FSM Intrm. 94 (Pon. 2002).] Plaintiffs Adams and Varner hold a certificate of title to the land in dispute, which is located in Pohnpei. Plaintiff Carlos Etscheit Soap Company, Inc., is the lessee of the subject land, to which the defendants ("the Gilmetes") also make an ownership claim. Carlos Etscheit Soap Company, Inc., is owned both by citizens of the FSM and the United States. It is this foreign ownership interest which forms the basis for this court’s exercise of diversity jurisdiction over the case under Article XI, Section 6(b) of the FSM Constitution, and gives rise to the single issue presented. That issue, as framed by the Gilmetes, is "whether the Supreme Court of the Federated States of Micronesia has jurisdiction to hear diversity cases where an interest in land is at issue."

I. Discussion

Section 6(b) of Article XI of the FSM Constitution provides as follows: "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 citizen thereof, and a foreign state, citizen, or subject." The national courts referred to in this section mean the trial division of the FSM Supreme Court and any other national courts which may be established in the future. Hawk v. Pohnpei, [1989] FMSC 24; 4 FSM Intrm. 85, 89 (App. 1989); Bank of Guam v. Semes, [1988] FMSC 7; 3 FSM Intrm. 370, 377

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(Pon. 1988). The cases cited in Section 6(b) are of two general types, those involving issues under the Constitution or a national law or treaty, and those involving parties where citizenship or state status is the determining factor. We are concerned here with a case of the second general type - one between a citizen of a state of the FSM (Pohnpei), and a citizen of a foreign state (the United States). On its face Section 6(b) of Article XI is an unqualified grant of jurisdiction to the national courts of the FSM over the kinds of cases enumerated in that section, and specifically over the type of case at bar.

In contrast to Section 6(b), Section 6(a) of Article XI provides as follows: "The trial division of the Supreme Court has original and exclusive jurisdiction in cases affecting officials of foreign governments, disputes between states, admiralty or maritime cases, and in cases in which the national government is a party except where an interest in land is at issue" (emphasis added). Section 6(a) names four different types of cases: 1) those affecting officials of foreign governments; 2) those involving disputes between states; 3) those that are admiralty or maritime in character; and 4) those where the national government is a party. With respect to the fourth type of case, Section 6(a) carves out a specific exception for cases involving land - the trial division has original and exclusive jurisdiction in cases in which the national government is a party "except where an interest in land is at issue." Or to cast this as a negative, the trial division does not have original and exclusive jurisdiction in a case in which the national government is a party and an interest in land is at issue. Thus Section 6(a) contains a single jurisdictional exception limited in scope to a case involving the national government as a party. In contrast, Section 6(b) follows immediately after Section 6(a) and contains no exception of any kind. This fact admits of no conclusion other than the obvious one: the Framers intended that the limited exception stated in Section 6(a) apply to cases involving an interest in land in which the national government is a party, and with equal force intended that no such exception apply to any of the kinds of cases specified in Section 6(b). In this context we consider the Gilmetes’ arguments.

In urging that this court lacks jurisdiction in a diversity case presenting land issues, the Gilmetes cite Ladore v. U Corporation, [1995] FMSC 45; 7 FSM Intrm. 296 (Pon. 1996), and Etpison v. Perman, [1984] FMSC 3; 1 FSM Intrm. 405 (Pon. 1984). Neither of these cases provide support for the Gilmetes, since they both hold that the national court does have diversity jurisdiction over cases involving land under Article XI, Section 6(b) of the FSM Constitution. The Ladore court noted that "[a] threshold question is whether this dispute over an interest in land between an individual citizen of Pohnpei and a corporation whose principal place of business is Pohnpei, belongs before the FSM Supreme Court." 7 FSM Intrm. at 297. After examining the question of diversity of citizenship, the court found that "[d]iversity of citizenship between the parties thus exists, and jurisdiction of the FSM Supreme Court is proper." Id. at 298. At the same time, the court abstained from deciding the question whether a private easement had become a public road. Id. at 298-99. But abstention by definition cannot take place in the absence of subject matter jurisdiction, since the abstention itself requires that the national court have subject matter jurisdiction concurrently with the state court. Id. at 298. (The rationale for abstention is that the state court is the better court to decide an issue which involves state powers and particularly strong, identifiable state interests. Gimnang v. Yap, 5 FSM Intrm. 13, 21 (App. 1991).) Abstention is not the issue in the case at bar, since the sole issue raised is that of this court’s diversity jurisdiction over a case involving an interest in land. In Etpison, also a land dispute, the court found without discussion that "[t]he Court has jurisdiction over this case because of the diversity of citizenship of the parties." 1 FSM Intrm. at 413. Thus neither of the two cases cited by the Gilmetes support their contention that this court does not have jurisdiction over a diversity case involving land issues.

Nor do other cases that address the issue offer support for the Gilmetes’ position. In re Estate of Nahnsen, 1 FSM Intrm. 97, 102 (Pon. 1982), involved the question of the Pohnpei trial division’s subject matter jurisdiction in a diversity case involving probate proceedings where an interest in land was at issue. The court concluded that the regulation of land and inheritance were state powers, and abstained for a period of 45 days to give the Ponape district court (the then-existing court that most closely resembled the state court contemplated by the FSM Constitution) to take - or indicate that it would take - certain steps. Id. at 113. But while abstaining on a limited basis, the court noted that

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"[t]he conclusion that the powers to regulate probate, inheritance and land matters are powers of states, rather than the national government, of course does not suggest that this court is without jurisdiction to preside over proceedings involving the exercise of those powers." Id. at 108. The court held that regardless of the fact that the issues involved were state and local in character, and not national, the FSM Constitution still placed jurisdiction in the national court in a diversity case. Id. at 102.

In Ponape Chamber of Commerce v. Nett, [1984] FMSC 2; 1 FSM Intrm. 389, 394 (Pon. 1984) the basis for the court’s jurisdiction was not diversity; rather, jurisdiction derived from the fact that the case involved interpretation of the FSM Constitution. However, citing Nahnsen, the court noted that the national court could determine state or local issues so long as the court had jurisdiction over the dispute, and emphasized that "the allocation of judicial authority under this constitutional system is made on the basis of jurisdictional grants, not whether state, or national ‘powers,’ are at issue." Id. at 393. Etscheit v. Adams, [1991] FMSC 30; 5 FSM Intrm. 243 (Pon. 1991), involved a family dispute over title to land in Pohnpei. The court held that "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." Id. at 246. The jurisdictional question presented in Luzama v. Ponape Enterprises Company, [1995] FMSC 11; 7 FSM Intrm. 40, 42-43 (App. 1995), which was a consolidation of eleven appeals all involving land issues, was whether complete diversity - i.e., where no plaintiff holds the same citizenship as any defendant - was required among the parties in order for the national court to exercise jurisdiction in a case involving land issues under Article XI, Section 6(b). The court found only minimal diversity - i.e., where one plaintiff has a different citizenship from one defendant - was necessary to sustain diversity jurisdiction in a case involving land questions. Id. at 48. Lastly, in FSM Development Bank v. Ifraim, [2001] FMSC 45; 10 FSM Intrm. 1, 5 (Chk. 2001), the court in the course of addressing a jurisdictional question under Article XI, Section 6(a), cited Luzama for the proposition that the FSM Supreme Court can decide a land issue under the diversity jurisdiction clause of Article XI, Section 6(b).

The foregoing review of FSM cases demonstrates that if we were to find that the national courts lack jurisdiction over diversity cases involving land issues, we would be obliged to jettison nearly twenty years of jurisprudence in this area. While we may consider the common law of other nations in deciding cases, Gimnang v. Yap, [1996] FMYSC 1; 7 FSM Intrm. 606, 609 (Yap S. Ct. Tr. 1996), we emphasize that all of these cases are from our own court. They provide an informed and reasoned basis for settled FSM law is this area. The principle of stare decisis is one of the guiding lights of our jurisprudence, and without a principled and compelling reason for overruling this line of FSM cases, we are disinclined to do so.

The Gilmetes point to the fact that in 2001, the Third Constitutional Convention of the Federated States of Micronesia adopted Committee Proposal No. 01-5, which proposed "inserting an exception to the relevant Article that will prohibit or strip the National Courts of any jurisdiction whatsoever in cases where ownership of land and waters are at issue regardless of the diversity of citizenship." This proposal would have amended Article XI, Section 6(b) of the FSM Constitution by divesting the national courts of jurisdiction over cases involving ownership of land. While we are cognizant of this fact, we are equally cognizant of the fact that the proposal was not ratified by the people. Article XIV, Section 1 of the FSM Constitution provides in pertinent part that "[a]n amendment to this Constitution may be proposed by a constitutional convention, popular initiative, or Congress in a manner provided by law. A proposed amendment shall become part of the Constitution when approved by 3/4 of the votes cast on that amendment in each of 3/4 of the states." This provision of the Constitution provides the only methods by which the Constitution may be amended.

The Gilmetes are effectively urging that this court should amend Article XI, Section 6(b) of the Constitution by reading into it language that does not appear in that section - i.e., that the national courts have diversity jurisdiction in the cases specified in that section "except where ownership of land is at issue." To do so would be to amend the Constitution by judicial fiat, a course of action not only plainly inimical to Article XIV, Section 1 of the Constitution, but one upon which we are constitutionally forbidden from embarking. Thus we reject the Gilmetes’

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contention that adoption of Committee Proposal No. 01-5 by the Third Constitutional Convention acts as a check upon the exercise of this court’s diversity jurisdiction in land cases.

All that we have said thus far must also be considered in light of the fact that Article XI, Section 6(b) guarantees that individuals who fall within its ambit may invoke the jurisdiction of this court. As the court in Bank of Guam v. Semes, [1988] FMSC 7; 3 FSM Intrm. 370, 379 (Pon. 1988), stated, the "parties to a dispute within the scope of article XI, section 6(b) have a constitutional right to invoke the jurisdiction of this court." It follows that "[i]t is the solemn obligation of this Court and all others within the Federated States of Micronesia to uphold that constitutional right [to invoke national court jurisdiction under Article XI, Section 6(b)]." U Corp. v. Salik, [1988] FMSC 20; 3 FSM Intrm. 389, 392 (Pon. 1988). To accept the Gilmetes’ contention that the trial division of this court has no jurisdiction in diversity cases involving land would defeat the exercise of that right. The Constitution bars us from being complicit in this. We uphold the right of litigants who fall within the scope of Article XI, Section 6(b) to invoke jurisdiction of this court in cases involving land issues.

II. Conclusion

Accordingly, the judgment of the trial court is affirmed in its entirety.

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