Federated States of Micronesia v Kana Maru No. 1 [2006] FMSC 26; 14 FSM Intrm. 300 (Chk. 2006) (4 July 2006)

FEDERATED STATES OF MICRONESIA
SUPREME COURT TRIAL DIVISION
Cite as FSM v. Kana Maru No. 1[2006] FMSC 26; , 14 FSM Intrm. 300 (Chk. 2006)

FEDERATED STATES OF MICRONESIA,
Plaintiff,

vs.

KANA MARU NO. 1, a fishing vessel, TETUMI

NISHI, TOSHIHIKO IKEMA, and SANKO BUSSAN

COMPANY (GUAM), LIMITED,
Defendants.

CIVIL ACTION NO. 2006-1011

ORDER SETTING BOND FOR VESSEL’S RELEASE

Dennis K. Yamase
Associate Justice

Hearing: July 3, 2006
Decided: July 4, 2006

APPEARANCES:

For the Plaintiff:
Keith J. Peterson, Esq.
Assistant Attorney General
FSM Department of Justice
P.O. Box PS-105
Palikir, Pohnpei FM 96941

For the Defendants:
Roger P. Crouthamel, Esq. (motion)
David Ledger, Esq. (argued)
Carlsmith Ball LLP
134 West Soledad Avenue, Suite 401
P.O. Box BF
Hagatna, Guam 96932-5027

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HEADNOTES

Evidence - Hearsay

[14 FSM Intrm. 308]

An FSM police report, if relevant, may be considered in a proceeding to release a vessel when it is not a criminal case, since police reports, as matters observed pursuant to duty imposed by law as to which matters there was a duty to report, are admissible as an exception to the rule that hearsay is generally inadmissible and since a motion for a vessel’s release is in the nature of a bond or bail hearing, and the rules of evidence generally do not apply to proceedings with respect to release on bail or otherwise. FSM v. Kana Maru No. 1[2006] FMSC 26; , 14 FSM Intrm. 300, 302 (Chk. 2006).

Jurisdiction - In Rem
When the proceeding against the defendant vessel is an in rem proceeding - the vessel’s forfeiture is sought - a motion to release the vessel without any bond will be denied because in order to exercise in rem jurisdiction, the thing over which jurisdiction is to be exercised (or its substitute, e.g., a bond) must be physically present in the jurisdiction and under the court’s control. FSM v. Kana Maru No. 1[2006] FMSC 26; , 14 FSM Intrm. 300, 302 (Chk. 2006).

Marine Resources
When the applicable statute permits the court take into account the possible fishing violation fines, but states that the bond should not exceed the value of the property to be released and when it also provides that notwithstanding that provision, the amount determined by the court for a bond must not be less than the fair market value of the property to be released or the aggregate minimum fine for each offense charged, whichever is greater, Congress has left the court no choice but to set the vessel’s bond at the aggregate minimum fine when this exceeds the vessel’s value. FSM v. Kana Maru No. 1[2006] FMSC 26; , 14 FSM Intrm. 300, 302 (Chk. 2006).

Marine Resources
The statutory use of the phrase "offense charged," for fishing violations, while usually indicative of a criminal prosecution and not a civil suit (in civil cases, violations are alleged, not offenses charged), appears to be intended to cover both civil and criminal violations. FSM v. Kana Maru No. 1[2006] FMSC 26; , 14 FSM Intrm. 300, 302 (Chk. 2006).

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COURTS OPINION

DENNIS K. YAMASE, Associate Justice:

The defendants’ Motion to Release Vessel was heard on July 3, 2006. The motion asks that the arrested vessel, the Kana Maru No. 1, be released without any bond. Alternatively, if the court denies that request, the defendants ask that a bond be set for the vessel’s release in the range of $45,000 to $50,000, the vessel’s value as stated in sworn declaration of Tetsuo Okubo, defendant Sanko Bussan Co. (Guam) Ltd.’s general manager. The defendants further ask that the court not consider the police report that the plaintiff refers to in its opposition to the release motion on the ground that the report is hearsay and only admissible evidence should be used to decide the motion. The government asks for forty-eight hours to provide its own declaration of the vessel’s value.

[2006] FMSC 43; [14 FSM Intrm. 309]

I.

Although hearsay, the FSM police report, if relevant, may be considered in this proceeding. Since this is not a criminal case, police reports, as "matters observed pursuant to duty imposed by law as to which matters there was a duty to report," are admissible as an exception to the rule that hearsay is generally inadmissible. FSM Evid. R. 803(8)(B). Furthermore, this motion is in the nature of a bond or bail hearing, and the rules of evidence generally do not apply to "proceedings with respect to release on bail or otherwise." FSM Evid. R. 1101(d)(3). The police report, however, does not appear to be particularly relevant to this motion.

II.

This motion only concerns the release of the defendant vessel, the Kana Maru No. 1. It does not concern the other defendants. The court concludes that the vessel may be released provided that a bond (cash or irrevocable letter of credit acceptable to the government) is paid into court. The reasons follow.

The proceeding against defendant Kana Maru No. 1 is an in rem proceeding - the vessel’s forfeiture, pursuant to 24 F.S.M.C. 801(1), is sought. In order to exercise in rem jurisdiction, the thing over which jurisdiction is to be exercised (or its substitute, e.g., a bond) must be physically present in the jurisdiction and under the court’s control. In re Kuang Hsing No. 127[1995] FMSC 5; , 7 FSM Intrm. 81, 82 (Chk. 1995) (citing Republic Nat’l Bank v. United States, [1992] USSC 123; 506 U.S. 80, 86-87[1992] USSC 123; , 113 S. Ct. 554, 559[1992] USSC 123; , 121 L. Ed. 2d 474, 483 (1992)). The motion to release the vessel without any bond is therefore denied.

The government asks that the court take into account the nature of the violations it alleges the defendants have committed and seems to ask the court to require a bond greater than the vessel’s value. It asks that the court consider that the aggregate minimum fines in the case would be $180,000. The government would also like forty-eight hours to put on the record its estimation of the Kana Maru No. 1's value as it is unwilling to accept that the Kana Maru No. 1's fair market value is $45,000-50,000.

This case was filed on May 29, 2006. The vessel was arrested ten days earlier, May 19, 2006. The government has had ample time to have a marine surveyor value the Kana Maru No. 1. It has not done so. The applicable statute permits the court take into account the possible fines, but states that "[I]n no case should the bond exceed the value of the property to be released." FSM Pub. L. No. 12-34, § 80(2) (to be codified F.S. F.S.M.C. 806(2)). However, the statute also provides that: "Notwithstanding the provisions of subsection (2) of this section, the amount determined by the Court under this section shall e less than the fair marketarket value of the property to be released or the aggregate minimum fine or penalty for each offense charged, whichever is greater." Id. § 80(3) (to be ced at 24 F.S. F.S.M.C. 806(3)).

Congress has left the court no choice but to set the bond at $180,000, the aggregate minimum fine of the three violations that the government intendproceed upon (the governmenrnment having indicated at the hearing that it would withdraw one alleged violation). (The use of the phrase "offense charged," while usually indicative of a criminal prosecution and not a civil suit (in civil cases, violations are alleged, not offenses charged), appears to be intended to cover both civil and criminal violations. The bond is therefore set at $180,000 (cash or irrevocable letter of credit acceptable to the government) to be paid into court before the vessel may be released.

The statute further requires that the court set out what portion of the bond is attributable to the property released and what part is attributable to the total likely fines. FSM Pub. L. No. 12-34, § 80(4) (to be codified at 24 F.S.M.C. 806(4)). Fifty thousand dollars of the bond is attributable to the vessel to be released and the balance ($130,000) is autable to possible fines.

[14 FSM Intrm. 310]

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