San Nicholas v Neth [2008] FMSC 55; 16 FSM Intrm. 70 (Pon. 2008) (20 August 2008)

FSM SUPREME COURT TRIAL DIVISION

CIVIL ACTION NO. 2007-029

JOSE SAN NICHOLAS d/b/a POHNPEI WHITE SANDS,
Plaintiff,

vs.

DION NETH, individually and in his capacity as Representative of Election District 2, HENSTER CARL, and ALTRICKSON DIOPULOS,
Defendants.

______________________________

ORDER AND MEMORANDUM

Andon L. Amaraich
Chief Justice

Decided: August 20, 2008

APPEARANCES:

For the Plaintiff: Joseph S. Phillip, Esq.
P.O. Box 464
Weno, Chuuk FM 96942

For the Defendant: Stephen V. Finnen, Esq.
(Neth) P.O. 1450
Kolonia, Pohnpei FM 96941

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HEADNOTES

Jurisdiction  Removal
A case stands removed to the FSM Supreme Court trial division when the party seeking removal files in the FSM trial division a verified petition for removal along with all the papers served on or by the removing party. The removing party must file the petition within 60 days of being served with any paper from which it is first ascertainable that the case is removable. San Nicholas v. Neth, [2008] FMSC 55; 16 FSM Intrm. 70, 71 (Pon. 2008).

Civil Procedure  Dismissal; Jurisdiction  Removal
A motion to dismiss under Rule 12(b) proceeds on the assumption that the allegations of the complaint are true. Similarly, the complaint's allegations are deemed true for purposes of a motion to remand a removed case to the state court on the basis that the FSM Supreme Court lacks subject matter jurisdiction. San Nicholas v. Neth, [2008] FMSC 55; 16 FSM Intrm. 70, 72 (Pon. 2008).

Jurisdiction  Removal
When the complaint's allegations do not point to any specific actions that a defendant took on the national government's behalf for which the national government should be held to account; when neither a descriptive allegation that a defendant was a Congress representative nor any other allegation alleges that he was acting as an agent of the FSM national government when he entered into the contract alleged; when the complaint alleges that the contract's purpose was to further the defendant's personal interest by facilitating his reelection to Congress; when the relief requested seeks nothing from the national government, but rather is a request for a joint and several judgment against the defendants individually, looking to the complaint's allegations and considering those as true, the complaint alleges that the defendant was acting for himself personally at relevant times that he allegedly entered into the contract and not as an agent of the national government. Since the only apparent basis for subject matter jurisdiction in this court is that the defendant was an agent of the national government at relevant times, the FSM Supreme Court lacks subject matter jurisdiction and the plaintiff's motion to remand will be granted. San Nicholas v. Neth, [2008] FMSC 55; 16 FSM Intrm. 70, 72 (Pon. 2008).

Jurisdiction  Removal
If at any time before final judgment it appears that a case was removed from state court improvidently and without jurisdiction, the FSM Supreme Court trial division must remand the case, and the clerk of court will mail a certified copy of the remand order to the state court. San Nicholas v. Neth, [2008] FMSC 55; 16 FSM Intrm. 70, 73 (Pon. 2008).

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COURT'S OPINION

ANDON L. AMARAICH, Chief Justice:

This case was originally filed in the Pohnpei Supreme Court on August 16, 2007, and was removed to this court pursuant to GCO 1992-2 when defendant Dion Neth filed a verified petition for removal on September 28, 2007. The filing of the removal petition effected removal to this court pursuant to GCO 1992-2, which provides that a case stands removed to the FSM trial division when the party seeking removal files in the FSM trial division a verified petition for removal along with all the papers served on or by the removing party. Under subparagraph II(B) of the general court order, the removing party must file the petition within 60 days of being served with any paper from which it is first ascertainable that the case is removable. The removal of this case from the Pohnpei Supreme Court to this court occurred in a timely fashion.

On October 1, 2007, Neth filed in this court his motion to dismiss pursuant to FSM Civil Rule 12(b)(7) on the basis that the FSM is an indispensable party to this action under FSM Civil Rule 19. On October 17, 2007, the plaintiff Jose San Nicholas filed his opposition to the motion to dismiss and also moved to remand this matter to the state court on the basis that this court lacks subject matter jurisdiction over the case. GCO 1992-2, § III(Cvides that at any time time before final judgment, a case may be remanded back to the state court if it appears that this court lacks jurisdiction.

complaint in this case seeks payment in the amount of $73,3$73,374.75 for services allegedly provided to Dion Neth and his employees Henster Carl and Altrickson Diopulos for road construction, delivery of coral, and equipment rental. The services were allegedly provided to various sites in Neth's Election District 2 from July, 2005, to October, 2005, in order to facilitate Neth's reelection to the FSM Congress. Neth's basis for removing the case to this court is that the complaint alleges that Neth is an FSM Congressman and is to be considered an agent or employee of the FSM national government for purposes of the acts which he allegedly committed. Neth concludes that this court therefore has jurisdiction over this case under Article XI, Section 6(a) of the FSM Constitution, which provides that the FSM Supreme Court trial division has original and exclusive jurisdiction over cases in which the national government is a party except where an interest in land is at issue.

In his motion to dismiss, Neth asserts that this court must dismiss the case because the FSM national government is not a party to this action. Neth contends that the FSM national government is an indispensable party under FSM Civil Rule 19. Thus Neth's petition for removal rests on the contention that this court has jurisdiction over cases where the national government is a party, while the motion to dismiss urges that the complaint must be dismissed because the FSM national government is not a party, and is in fact an indispensable party under FSM Civil Rule 19.

The plaintiff San Nicholas opposes the motion to dismiss, and also moves to remand the case to Pohnpei Supreme Court, on the basis that the complaint states a claim against the defendant Dion Neth, and not against the FSM government. San Nicholas contends that the contract for the road construction services alleged was only with Neth, and that defendants Carl and Diopulos were Neth's agents and employees. All of the defendants are alleged to be citizens of Pohnpei. San Nicholas concludes that this court does not have subject matter jurisdiction over this case because the parties are not diverse, and this case does not involve a question of national law.

A motion to dismiss under Rule 12(b) proceeds on the assumption that the allegations of the complaint are true. Chuuk v. Secretary of Finance, [1996] FMSC 59; 7 FSM Intrm. 563, 569–70 (Pon. 1996). Similarly, the allegations of the complaint are deemed true for purposes of San Nicholas's motion to remand this case to the Pohnpei Supreme Court on the basis that this court lacks subject matter jurisdiction.

The designation "Individually and in his capacity as Representative of election district 2" occurs in the caption of the complaint, while another reference, "individually and as representative of election district No. 2," occurs in the preamble paragraph preceding the allegations of the complaint. Thus these descriptive phrases are not among the allegations of the complaint that are to be considered true for purposes of the motion to remand. But apart from that concern, the allegations do not point to any specific actions that Neth took on behalf of the national government for which the national government should be held to account. The defendants are alleged to have "solicited and procured from plaintiff job orders and induced plaintiff to carry out and perform road construction works, and ordered and purchased corals for delivery to various sites in election district No. 2." Compl. 6. They are also allegedave have "induced the plaintiff to provide rental heavy equipment to compact and grade roadways within various sites in the election district No. 2." Id. A reference to Neth's elected status does in fact occur in the allegations of the complaint in 4, which states that "Deft dant Dion Neth is a representative of election district No. 2 in the FSM Congress." But neither this descriptive allegation nor any other allegation alleges that Neth was acting as an agent e FSM national government went when he entered into the contract alleged. According to 11he complaint, the purposerpose of the contract was to further Neth's personal interest by facilitating his reelection to the FSM Congress: "the defendant Dion Nas won re-election to a second term in the FSM Congress at s at the expense of the plaintiff." The relief requested seeks nothing from the national government, but rather is a request for a joint and several judgment against the defendants individually.

Looking to the allegations of the complaint, and considering those as true, leads to the conclusion that the complaint alleges that Neth was acting for himself personally at relevant times when he allegedly entered into the contract at issue, and not as an agent of the national government. Since the only apparent basis for subject matter jurisdiction in this court is that Neth was an agent of the national government at relevant times, this court lacks subject matter jurisdiction.

Accordingly, San Nicholas's motion to remand is granted. This case is remanded to the Pohnpei Supreme Court pursuant to FSM GCO 1992-2, § III(C), which providat "[i] "[i]f at any time before final judgment it appears that the case was removed improvidently and without jurisdiction . . . the trial division of the Supreme Court shall remand the case [to the state court]." Neth's motion to dismiss is denied as moot by virtue of the remand.

Pursuant to GCO 1992-2, § III(C), the clerk of courdiis directed to mail a certified copy of this order to the Clerk of the Pohnpei Supreme Court.

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