Barrett v Chuuk [2009] FMSC 49; 16 FSM Intrm. 229 (App. 2009) (5 January 2009)

FSM SUPREME COURT APPELLATE DIVISION

APPEAL CASE NO. C1-2008

DANNY BARRETT,
Appellant,

vs.

STATE OF CHUUK,
Appellee.

___________________________________

[2009] FMSC 49; [16 FSM Intrm 229] OPINION

Argued: September 1, 2008
Decided: January 5, 2009

BEFORE:

Hon. Andon L. Amaraich, Chief Justice, FSM Supreme Court
Hon. Martin G. Yinug, Associate Justice, FSM Supreme Court
Hon. Aliksa B. Aliksa, Temporary Justice, FSM Supreme Court*

*Chief Justice, Kosrae State Court, Tofol, Kosrae

APPEARANCES:

For the Appellant: Steven V. Finnen, Esq.
P.O. Box 1450
Kolonia, Pohnpei FM 96941

For the Appellee: Joses Gallen, Esq.
Chuuk Attorney General
P.O. Box 1050
Weno, Chuuk FM 96942

* * * *

HEADNOTES

Attachment and Execution
A trial court's decision to enter or not enter a writ of execution or garnishment is discretionary. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 232 (App. 2009).

Appellate Review  Standard of Review  Civil Cases
An abuse of discretion occurs when 1) the court's decision is clearly unreasonable, arbitrary, or fanciful; 2) the decision is based on an erroneous conclusion of law; 3) the court's findings are clearly erroneous; or 4) the record contains no evidence on which the court rationally could have based its decision. Such abuses must be unusual and exceptional; an appeals court will not merely substitute its judgment for that of the trial judge. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 232 (App. 2009).

[16 FSM Intrm 230]

Appellate Review  Standard of Review  Civil Cases
When the facts are not in dispute and questions of law alone are present, the appellate court reviews these questions de novo, and motions that the trial court decided as a matter of law are issues of law, which an appellate court reviews de novo. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 232 (App. 2009).

Appellate Review  Standard of Review  Civil Cases
An issue on the application of a statutory provision is an issue of law that is reviewed de novo on appeal. Statutes are presumed constitutional until challenged, and the burden is on the challenger to clearly demonstrate that a statute is unconstitutional. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 232 (App. 2009).

Appellate Review  Decisions Reviewable
An appeal to the FSM Supreme Court appellate division may be made from all "final decisions" of the FSM Supreme Court trial division. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 233 (App. 2009).

Appellate Review  Decisions Reviewable
When the trial court planned to take further post-judgment action, its decision could not be considered final for appeal purposes. But when the trial court states that it will not take any further action unless the appellate division chooses to expand a previous ruling, the trial court's order is a final decision since it does not contemplate further action by the court, and the appeal will proceed on the merits. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 233 (App. 2009).

Attachment and Execution; Civil Rights; Sovereign Immunity  Chuuk
Although a compelling state interest exists in protecting the state from garnishment and execution of its funds as governments cannot effectively administrate essential public services with litigants constantly raiding their coffers, but since Congress has created a statutorily-based action for civil rights violations as these violations are particularly egregious in that they infringe upon what we commonly recognize as unalienable human rights, what must be struck is an adequate balance between protecting a government's ability to maintain sufficient funds to operate and the ability to hold the government accountable for violating its citizens' most basic rights. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 234 (App. 2009).

Civil Rights
The FSM civil rights statute is intended to provide an effective remedy when constitutional rights are violated. A fundamental role of the government, be it state or national, is to safeguard those rights. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 234 (App. 2009).

Attachment and Execution  Garnishment; Civil Rights
A statute is unconstitutional to the extent that it prohibits garnishment of state funds to satisfy a civil rights judgment, including civil rights judgments involving purely economic damages as well as those involving physical injury damages. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 234 (App. 2009).

Statutes  Construction
The appellate division should avoid unnecessary constitutional adjudication, and when interpreting statutes should try to avoid interpretations which may bring the constitutionality of the statute into doubt. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 234 (App. 2009).

Attachment and Execution; Debtors' and Creditors' Rights  Orders in Aid of Judgment
Process to enforce a judgment for the payment of money may be a writ of execution or an order in aid of judgment. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 234 (App. 2009).

[16 FSM Intrm 231]

Attachment and Execution; Sovereign Immunity  Chuuk
None of the FSM Code statutory exemptions to garnishment and execution provide an exception to execution or garnishment when the debtor is a state government. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 234 (App. 2009).

Civil Rights; Constitutional Law  Supremacy Clause; Sovereign Immunity  Chuuk
The FSM Constitution's supremacy clause does not permit a state law to prevent the enforcement of a national statute which gives a private cause of action for rights guaranteed by the FSM Constitution, especially when it is the solemn obligation of state governments to uphold the principles of the FSM Constitution and to advance the principles of unity upon which the Constitution is founded. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 234-35 (App. 2009).

Attachment and Execution
Requests for writs of execution or garnishment demand consideration of many factors, including the nature of the judgment, whether or not the debtor has acted in good or bad faith in its attempts to satisfy the judgment, the length of time the judgment has gone unsatisfied, etc. These factors are best weighed by the trial court. Barrett v. Chuuk, [2009] FMSC 49; 16 FSM Intrm. 229, 235 (App. 2009).

* * * *

COURT'S OPINION

MARTIN YINUG, Associate Justice:

On November 24, 1993, the FSM Trial Division entered judgment in favor of Danny Barrett against Chuuk State in the amount of $16,185.00 for contract damages. This judgment was entered in Civil Action No. 93-1009. On July 20, 2004, the trial court in Civ. No. 93-1009 denied Barrett's post-judgment motion for a writ of garnishment.

On October 22, 2004, Barrett filed a civil rights action against Chuuk, alleging deprivation of property without due process, 11 F.S.M.C. 701, for Chuuk's failure to pay the damages from Civ. No. 93-1009. This civil rights action is Civil Action 2004-1026. Default judgment was entered against Chuuk in Civ. No. 2004-1026 on September 27, 2005, confirming the original judgment from Civ. No. 93-1009 and adding post-judgment interest to reach a total of $33,405.67 in damages, plus attorney's fees of $3,351.20 awarded on December 5, 2005.

The trial court in Civ. No. 2004-1026 entered an order in aid of judgment on June 11, 2007, directing Chuuk to submit through its executive branch an appropriation request to the legislature to pay the judgment. On September 28, 2007, Barrett filed a motion for writ of execution directed against Chuuk, or, in the alternative, a writ of garnishment directed to the FSM to be levied upon Chuuk's funds held by the FSM. On December 28, 2007, the trial court in Civ. No. 2004-1026 denied Barrett's motion for writ. Barrett filed a notice of appeal to the FSM Appellate Division on January 21, 2008, challenging the trial court's rationale for denying his motion for writ. Oral argument was held on September 1, 2008, in Chuuk, at which both parties were represented by counsel.

I. ISSUES ON APPEAL

A. Is the trial court's order of December 28, 2007 a reviewable decision?

B. May a civil rights judgment for other than physical injuries resulting from civil rights violations, satisfaction of which has been denied for an unreasonably long period of time, be satisfied against a

[16 FSM Intrm 232]

sovereign state by a writ of execution or by garnishment of its funds held by the national government?

C. Is 6 F.S.M.C. 707 an unconstitutional prohibition against garnishment of state property held by the national government for enforcement of a civil rights judgment for other than physical injuries?

D. Is Chuuk State Law No. 190-08, section 4, prohibiting attachment, execution or garnishment of state property, an unconstitutional prohibition against enforcement of a civil rights judgment against the State of Chuuk for other than physical injuries?

E. What is an unreasonably long time for a sovereign state to fail to pay a judgment lawfully entered against the state?

F. What is the power of the trial court to enforce a judgment against a sovereign state when there is no attempt to appropriate funds for the payment of such judgment?

G. Once a judgment lawfully issues against a sovereign state, what is the power of the court to enforce such a judgment, if the state makes no reasonable effort to pay the judgment in a reasonable time?

H. Is the judgment underlying this appeal a civil rights judgment?

I. Does Chuuk State Law 9-07-9 prevent garnishment of Chuuk State funds being held by the FSM?

II. STANDARD OF REVIEW

A trial court's decision to enter or not enter a writ of execution or garnishment is discretionary. Bank of Guam v. Elwise, [1988] FMSC 2; 4 FSM Intrm. 150, 152 (Pon. 1989).

An abuse of discretion occurs when 1) the court's decision is clearly unreasonable, arbitrary, or fanciful; 2) the decision is based on an erroneous conclusion of law; 3) the court's findings are clearly erroneous; or 4) the record contains no evidence on which the court rationally could have based its decision. Such abuses must be unusual and exceptional; an appeals court will not merely substitute its judgment for that of the trial judge. Panuelo v. Amayo, [2004] FMSC 13; 12 FSM Intrm. 365, 372 (App. 2004).

When the facts are not in dispute and questions of law alone are present, the appellate court reviews these questions de novo. Sigrah v. Kosrae, [2004] FMSC 10; 12 FSM Intrm. 320, 324 (App. 2004). Motions that the trial court decided as a matter of law are issues of law, which an appellate court reviews de novo. Primo v. Pohnpei Transp. Auth., [2000] FMSC 35; 9 FSM Intrm. 407, 410-11 (App. 2000).

An issue on the application of a statutory provision is an issue of law that is reviewed de novo on appeal. Rodriguez v. Bank of the FSM, [2003] FMSC 12; 11 FSM Intrm. 367, 377 (App. 2003). Statutes are presumed constitutional until challenged, and the burden is on the challenger to clearly demonstrate that a statute is unconstitutional. Parkinson v. Island Dev. Co., [2003] FMSC 40; 11 FSM Intrm. 451, 453 (Yap 2003).

III. DISCUSSION

The trial court denied Barrett's motion for writ of execution or garnishment based upon the legal conclusion that Chk. S. L. No. 190-08, § 4 aF.S.M.C. 707 prohibit gait garnishment or execution of Chuuk's funds, including those funds being held by the national governmenrrett's issues all raise questions of law, together presenting a general challenge to the lthe legal basis of the trial court's decision. There are no disputed factual findings.

[16 FSM Intrm 233]

A. Is the trial court's order of December 28, 2007 a reviewable decision?

A question as to whether or not the underlying trial court decision is reviewable was raised sua sponte by the Court at oral argument, and the parties were given the opportunity to submit post-argument briefs on the issue.

FSM Appellate Rule 4 provides that appeal to this Court may be made from all "final decisions" of the trial division of the FSM Supreme Court.

Similar to the present matter is the situation addressed by the appellate division in the case of Chuuk v. Davis, 9 FSM Intrm. 471 (App. 2000),[1] in which a civil judgment was entered against the State of Chuuk. The trial court entered an order in aid of judgment, in which it found that Chuuk had the ability to pay the judgment and ordered the plaintiff to submit a status report in two months as to Chuuk's payments, at which point the trial court would take further action if the judgment was not paid in full. When the order in aid of judgment was appealed to our appellate division, the appeal was dismissed as not stemming from a final decision.

The trial court's order in the present matter is similar to the underlying order in Chuuk v. Davis, in that neither order makes findings as to how, when or with what funds Chuuk is to satisfy the judgment. However, the trial court in Chuuk v. Davis requested a future status report on the defendant's payments, and, more importantly, stated that the court would take further action if the defendant had not paid the judgment by the date of the status report. Because the trial court in Chuuk v. Davis planned to take further post-judgment action, its decision could not be considered final for appeal purposes. Conversely, in the present matter, the trial court states that it will not take any further action unless the appellate division chooses to expand a previous ruling. Under these circumstances, the reasoning in Chuuk v. Davis is not applicable to the present matter. Because it does not contemplate further action by the court, the trial court's order of December 28, 2007 is a final decision. This appeal will proceed on the merits.

B. May a civil rights judgment for other than physical injuries resulting from civil rights violations, satisfaction of which has been denied for an unreasonably long period of time, be satisfied against a sovereign state by a writ of execution or by garnishment of its funds held by the national government?

C. Is 6 F.S.M.C. 707 an unconstitutional prohibition against garnishment of state property held by the national government for enforcement of a civil rights judgment for other than physical injuries?

These two issues collectively raise the question of whether this tribunal should expand the holding in Chuuk v. Davis, [2005] FMSC 22; 13 FSM Intrm. 178 (App. 2005), in which our appellate division ruled that 6 F.S.M.C. 707 was unconstitutional to the extent that it prohibited garnishment of Chuuk State funds being held by the national government to satisfy a civil rights judgment with personal injury damages. The Davis court limited its holding, creating the impetus for this review: "We do not decide, and take no position on, whether plaintiffs whose damages from civil rights violations are strictly economic in nature may satisfy their judgments through similar writs of garnishment."

Before this tribunal is the question of whether or not the rule in Davis should be extended to apply to all civil rights judgments, including those resulting in purely economic damages.

[16 FSM Intrm 234]

There exists a compelling state interest in protecting the state from garnishment and execution of its funds, as governments cannot effectively administrate essential public services with their coffers being constantly raided by litigants. However, Congress has created a statutorily-based action for civil rights violations, as these violations are particularly egregious in that they infringe upon what we commonly recognize as unalienable human rights. What must be struck is an adequate balance between protecting a government's ability to maintain sufficient funds to operate and the ability to hold the government accountable for violating its citizens' most basic rights.

11 F.S.M.C. 701 et seq. is intended to provide an effective remedy when constitutional rights are violated. A fundamental role of the government, be it state or national, is to safeguard those rights. See Louis v. Kutta, [1998] FMSC 16; 8 FSM Intrm. 312, 317 (Chk. 1998). The Davis court clearly establishes that the FSM Supreme Court can garnish state funds to satisfy civil rights judgments with physical injury damages. The legal analysis in Davis, however, pertains generally to all civil rights judgments without distinction between those involving physical injury damages versus those involving purely economic damages. This tribunal does not see the logic in perpetuating this distinction, as all civil rights are equally unalienable and should therefore be equally protected. Accordingly, we accept Barrett's invitation to expand the ruling announced in Davis. We hold that 6 F.S.M.C. 707 is unconstitutional to the extent that it prohibits garnishment of Chuuk State funds to satisfy a civil rights judgment, including civil rights judgments involving purely economic damages as well as those involving physical injury damages. We remand this matter to the trial court to enter an amended order reflecting this ruling.

D. Is Chuuk State Law No. 190-08, section 4, prohibiting attachment, execution or garnishment of state property, an unconstitutional prohibition against enforcement of a civil rights judgment against the State of Chuuk for other than physical injuries?

The Appellate Division should avoid unnecessary constitutional adjudication, and when interpreting statutes should try to avoid interpretations which may bring the constitutionality of the statute into doubt. See Jonah v. FSM, [1992] FMSC 8; 5 FSM Intrm. 308, 313 (App. 1992); Louis v. Kutta, [1998] FMSC 2; 8 FSM Intrm. 228, 229 (Chk. 1998); Tosie v. Tosie, [1982] FMSC 13; 1 FSM Intrm. 149, 157 (Kos. 1982).

FSM Civil Rule 69 provides, in pertinent part, "Process to enforce a judgment for the payment of money shall be a writ of execution, unless the court directs otherwise. The procedure on execution, in proceedings supplementary to and in aid of a judgment, and in proceedings on and in aid of execution shall be in accordance with the practice and procedure of the state in which the court is held, existing at the time the remedy is sought, except that any statute of the Federated States of Micronesia governs to the extent that it is applicable."

In the present matter, the applicable governing FSM statute is 6 F.S.M.C. 1401 et seq., which provides that the "process to enforce a judgment for the payment of money may be a writ of execution or an order in aid of judgment, as provided in sections 1405 through 1415 of this chapter." 6 F.S.M.C. 1407 governs requests for writs of execution and garnishment. See Elwise, 4 FSM Intrm. at 152. 6 F.S.M.C. 1415 governs exemptions to garnishment and execution. None of these statutes provides an exception to execution or garnishment when the debtor is a state government. If there is local practice and procedure to be implemented in the present matter with respect to garnishment and execution, it exists outside the scope of 6 F.S.M.C. 1401 et seq., which in and of itself provides the trial court with the authority to enter a writ of garnishment or execution.

Barrett also urges that 11 F.S.M.C. 701 et seq., the statute underlying his civil rights judgment, supersedes Chk. S. L. No. 190-08 pursuant to FSM Civil Rule 69. We agree. Article II of the FSM Constitution, the supremacy clause, does not permit a state law to prevent the enforcement of a

[16 FSM Intrm 235]

national statute which gives a private cause of action for rights guaranteed by the FSM Constitution, especially when it is the solemn obligation of state governments to uphold the principles of the FSM Constitution and to advance the principles of unity upon which the Constitution is founded. See Louis v. Kutta, [1997] FMSC 36; 8 FSM Intrm. 208, 213 (Chk. 1997); Herman v. Municipality of Patta, [2003] FMSC 66; 12 FSM Intrm. 130, 136 (Chk. 2003); Estate of Mori v. Chuuk, [2003] FMSC 59; 12 FSM Intrm. 3, 11 n.5 (Chk. 2003).

Accordingly, we rule that Chk. S. L. No. 190-08 does not bar the trial court from entering a writ of execution or garnishment, as it is superseded here by 6 F.S.M.C. 1401 et seq. and 6 F.S.M.C. 701 et seq., pursuant to FSM Civil Rule 69. We remand this matter to the trial court to enter an amended order reflecting this ruling.

E. What is an unreasonably long time for a sovereign state to fail to pay a judgment lawfully entered against the state?

F. What is the power of the trial court to enforce a judgment against a sovereign state when there is no attempt to appropriate funds for the payment of such judgment?

G. Once a judgment lawfully issues against a sovereign state, what is the power of the court to enforce such a judgment, if the state makes no reasonable effort to pay the judgment in a reasonable time?

Issues E through G raise questions outside the purview of this review and appear to solicit a ruling ordering the trial court to enter a writ of execution or garnishment. Such a request, if appropriate, would be in the nature of a motion for writ of mandamus made pursuant to FSM Appellate Rule 21(a). Barrett has made no such motion and this tribunal will not entertain such a motion here sua sponte.

The trial court's power to enter writs is discretionary. Elwise, 4 FSM Intrm. at 152. The trial court in the present matter abused its discretion only in relying upon erroneous conclusions of law, namely that 6 F.S.M.C. 707 and Chk. S. L. No. 190-08 barred the granting of Barrett's motion for writ. While removing these two legal impediments to Barrett's motion for writ, our decision today takes no position on the substantive merit of Barrett's motion. An ultimate ruling on Barrett's motion for writ still lies squarely with the trial court pursuant to 6 F.S.M.C. 1401 et seq. Irrespective of the legal questions ruled upon in this decision, requests for writs of execution or garnishment demand consideration of many factors, including the nature of the judgment, whether or not the debtor has acted in good or bad faith in its attempts to satisfy the judgment, the length of time the judgment has gone unsatisfied, etc. See Tipingeni v. Chuuk, [2007] FMSC 9; 14 FSM Intrm. 539, 543 (Chk. 2007). These factors are best weighed by the trial court, and we make no attempt here to usurp that dominion.

H. Is the judgment underlying this appeal a civil rights judgment?

Judgment was entered against Chuuk pursuant to Chapter 7 of Title 11 of the FSM Code, entitled "Civil Rights." Furthermore, judgment was entered against Chuuk for depriving Barrett of property without due process of law, one of the most basic rights afforded to citizens under the Constitution. Under these circumstances, we find that the judgment underlying this appeal is a civil rights judgment.

I. Does Chuuk State Law No. 9-07-9 prevent garnishment of Chuuk State funds being held by the FSM?

Similar to Chk. S. L. No. 190-08, Chk. S. L. No. 9-07-9 does not bar the trial court from entering

[2009] FMSC 48; [16 FSM Intrm 236]

a writ of execution or garnishment, as it is superseded here by 6 F.S.M.C. 1401 et seq. and 11 F.S.M.C. 701 et seq., pursuant to FSM Civil Rule 69.

IV. Motion for Attorney's Fees

The trial court granted Barrett's motion for costs and fees on the underlying judgment on December 5, 2005. Once the right to fees and costs is established at the trial level, it is appropriate for the appellate court to award fees and costs for the appeal and remand the issue of the amount to the trial court for determination. See FSM v. Udot Municipality, [2004] FMSC 51; 12 FSM Intrm. 622, 624-25 (App. 2004). Barrett's motion for attorney's fees is granted, and this matter is remanded to the trial court to determine the amount of fees and costs to be awarded to Barrett for work on this appeal.

V. CONCLUSION

6 F.S.M.C. 707 and Chk. S. L. No. 190-08 do not bar the trial court from entering a writ of garnishment or execution against Chuuk. We remand this matter to the trial court to enter an amended order reflecting our rulings today.

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^[1]Because this opinion includes discussion of more than one case with this name, Chuuk v. Davis, [2000] FMSC 17; 9 FSM Intrm. 471 (App. 2000) will hereafter be referred to as "Chuuk v. Davis," and Chuuk v. Davis, [2005] FMSC 22; 13 FSM Intrm. 178 (App. 2005) will be referred to in shorthand as "Davis."