Edmond v FSM Development Bank [2018] FMSC 40; 22 FSM R. 77 (App. 2018) (16 October 2018)

FSM SUPREME COURT APPELLATE DIVISION
APPEAL CASE NO. K9-2015
(Civil Action No. 2009-2003)

JOAB EDMOND, MAGILINA EDMOND, ALIK
EDMOND, SENELY EDMOND, RODNEY EDMOND,
KENYE R. EDMOND, RANDY EDMOND, KAREN R.
EDMOND, RAMSIN EDMOND, FLORA EDMOND,
and MAKATO EDMOND,
Appellants,

vs.

FSM DEVELOPMENT BANK,
Appellee.
_______________________________________________

OPINION

Argued: April 30, 2018
Decided: October 16, 2018

BEFORE:

Hon. Cyprian J. Manmaw, Specially Assigned Justice, FSM Supreme Court*
Hon. Camillo Noket, Specially Assigned Justice, FSM Supreme Court**
Hon. Mayceleen J.D. Anson, Specially Assigned Justice, FSM Supreme Court***

*Chief Justice, State Court of Yap, Colonia, Yap
**Chief Justice, Chuuk State Supreme Court, Weno, Chuuk
***Associate Justice, Pohnpei Supreme Court, Kolonia, Pohnpei

APPEARANCES:

For the Appellants: Yoslyn G. Sigrah, Esq.
P.O. Box 3028
Kolonia, Pohnpei, FM 96941

For the Appellee: Nora E. Sigrah, Esq.
FSM Development Bank
P.O. Box M
Kolonia, Pohnpei, FM 96941

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HEADNOTES

Property - Deeds
A deed of trust is a deed conveying title to real property to a trustee as security until the grantor repays a loan. Edmond v. FSM Dev. Bank, 22 FSM R. 77, 79 n.1 (App. 2018).

Appellate Review - Standard - Civil Cases - Factual Findings
The standard of review of a trial court’s factual findings is whether those findings are clearly erroneous. In determining whether a factual finding is clearly erroneous, an appellate court must view the evidence in the light most favorable to the appellee. Edmond v. FSM Dev. Bank, 22 FSM R. 77, 79-80 (App. 2018).

Appellate Review - Standard - Civil Cases - De Novo
Issues of law are reviewed de novo on appeal. Edmond v. FSM Dev. Bank, 22 FSM R. 77, 80 (App. 2018).

Appellate Review - Standard - Civil Cases - Abuse of Discretion
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 could have rationally based its decision. Edmond v. FSM Dev. Bank, 22 FSM R. 77, 80 (App. 2018).

Appellate Review - Standard - Civil Cases
An issue not presented to and ruled upon by the trial court cannot properly come before the appellate division for review because the general rule is that on appeal a party is bound by the theory advanced in the trial court, and cannot urge a ground for relief which was not presented there. Edmond v. FSM Dev. Bank, 22 FSM R. 77, 80 (App. 2018).

Appellate Review - Standard - Civil Cases - Factual Findings
Generally, appellate courts do not make factual findings. Edmond v. FSM Dev. Bank, 22 FSM R. 77, 80 (App. 2018).

Appellate Review - Dismissal
An appeal will be dismissed when a review of the record shows that none of the issues the appellants raised were ever considered in the trial division, when the order of sale appealed from was never executed, and when the appellants concur that if the appellee no longer pursues the order of sale the matter should proceed in the trial division. Edmond v. FSM Dev. Bank, 22 FSM R. 77, 81 (App. 2018).

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COURT’S OPINION

PER CURIAM:

I. BACKGROUND

This appeal arises from an Order of Sale entered by the FSM Supreme Court trial division on August 6, 2015 in Civil Action No. 2009-2003. In August of 2009, the appellee, FSM Development Bank (herein "FSMDB") filed its complaint in this matter against Joab Edmond and Magilina Edmond (herein the "Edmonds") for failure to make payments on a $12,000.00 loan that was disbursed in May of 1994.

The loan was secured by a parcel of land known as Fwinyalu located in Utwe municipality, State of Kosrae, identified as Parcel No. 005-U-07. The security was in the form of a deed of trust granted by Maketo Edmond, Otniel Edmond, and Harold and Aliksru Edmond.^[1] The deed of trust was approved by the Kosrae State Office of the Attorney General and registered by Kosrae State Land Commission, naming the FSMDB as beneficiary and the Kosrae State Government as trustee.

In 1997, Parcel No. 005-U-007 was subdivided into two (2) parcels. The first parcel, No. 005-U-32, remained with Maketo Edmond. The second parcel, No. 005-U-33, was transferred to Aliksru Edmond.

Payments on the loan were made up until February 2009. The complaint in this matter was filed in August of 2009 against Joab and Magilina Edmond, Maketo Edmond and other family members who were residing on the parcel of land. Default Judgment was entered against the defendants on December 3, 2010. The trial court entered an Order in Aid of Judgment on July 7, 2011 based on the stipulation of the parties, where the Edmonds were to pay $200.00 a month to the FSMDB until satisfaction of the judgment.

Pursuant to the Order in Aid of Judgment, only four (4) payments were made in 2011, the last payment in December 2011. In 2012, the death of Maketo Edmond resulted in the filing of Civil Action 2012-2004, where Randy Edmond was named as the administrator for the estate of Maketo Edmond. An Order of Sale for Parcel No. 005-U-32 was entered by the trial division on August 6, 2015.^[2] The pending appeal was then filed on September 7, 2015.

On April 9, 2018, the Appellant filed a Motion to Disqualify the presiding Justice in this matter, FSM Supreme Court Chief Justice Dennis K. Yamase. This motion was orally granted at the outset of oral arguments on April 30, 2018, and Chief Justice Yamase was replaced by Cyprian J. Manmaw, Specially Assigned Justice to this matter. After the replacement of the presiding Justice, the Court then heard oral arguments from the parties.

II. ISSUES PRESENTED

Joab Edmond raises the following issues on appeal based on the trial division’s issuance of the Order of Sale on August 6, 2015:

1) The Court Order filed August 6, 2015, was erroneous, contrary to law, and was not based on substantial evidence.

2) The Court’s Order of August 6, 2015, violated Appellant’s constitutional due process rights.

III. STANDARD OF REVIEW

The standard of review of a trial court’s factual findings is whether those findings are clearly erroneous. Tulensru v. Wakuk, 10 FSM R. 128, 132 (App. 2001); Senda v. Mid-Pac Constr. Co., 5 FSM R. 277, 280 (App. 1992). In determining whether a factual finding is clearly erroneous, an appellate court must view the evidence in the light most favorable to the appellee. Kinere v. Kosrae, 6 FSM R. 307, 309 (App. 1993).

Issues of law are reviewed de novo on appeal. Simina v. Kimeuo, 16 FSM R. 616, 619 (App. 2009); George v. Nena, 12 FSM R. 310, 313 (App. 2004); Nanpei v. Kihara, 7 FSM R. 319, 323-24 (App. 1995); Sigrah v. Kosrae, 6 FSM R. 168, 169 (App. 1993).

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 . .&#16ourt rationally could ould have based its decision. Jano v. King, 5 FSM R. 326, 330 (App. 1992). See also Heap; Control, Inc. v. Hestor, Inc., [1986] USCAFED 197; 785 F.2d 1017, 1022 (Fed. Cir. 1986).

IV. ANALYSIS

1) Issues Raised by the Appellants were not Raised at the Trial Division

The FSMDB argues that the legal arguments raised by the Appellants were not presented to the court below, therefore, those issues as argued by the Appellants may not be considered by the Appellate Court.^[3] Appellee’s Br. at 11-12.

An issue not presented to and ruled upon by the trial court cannot properly come before the Appellate Division for review. FSM v. Moroni, 6 FSM R. 575, 579 (App. 1994); Loney v. FSM, 3 FSM R. 151, 154 (App. 1987); Loch v. FSM, 2 FSM R. 234, 236 (App. 1986).

The general rule is that on appeal a party is bound by the theory advanced in the trial court, and cannot urge a ground for relief which was not presented there. Paul v. Celestine, 4 FSM R. 205, 210 (App. 1990) (citing 4 C.J.S. Appeal and Error § 241(e) (1957)).

A review of the record shows that none of the issues raised by the Appellants were ever considered at the trial division. Judgment in this case was entered through default, and after a substantial period of attempting to collect on the judgment, the FSMDB was granted an Order of Sale of the land that secured the loan, which is the basis of this appeal. No evidence is presented that the issues on appeal were argued or considered by the trial court, nor was any relief sought from any Judgment or Order pursuant to FSM Civil Rule 60.^[4]

The FSMDB recommends that the present appeal be dismissed so that the pending issues may be raised before the trial court first, before being heard by the Appellate Court. The Court finds merit in this argument. Generally, appellate courts do not make factual findings. Goya v. Ramp, 14 FSM R. 305, 307 n.1 (App. 2006).

2) Non-Execution of Order of Sale

Further, FSMDB argues that this appeal lacks merit because the Order of Sale entered by the court below on August 6, 2015, which serves as the basis of this appeal, was never executed. As argued during oral arguments, FSMDB was notified that Joab Edmond had obtained gainful employment, therefore, did not pursue the execution of the Order of Sale because payments on the underlying debt in this matter may now be made.

Also during the hearing, the Edmonds concur that if the Order of Sale is no longer pursued by FSMDB, then this matter should proceed in the trial division.

V. CONCLUSION

After consideration of the record, and the oral arguments made before the Court, this matter is HEREBY DISMISSED.

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^[1] A Deed of Trust is defined as "A deed conveying title to real property to a trustee as security until the grantor repays a loan." BLACK’S LAW DICTIONARY 182 (2d pocket ed. 2001).

^[2] Parcel No. 005-U-07, which served as the security for the loan in this matter, was subsequently subdivided.

^[3] The following issues are raised by the Edmonds in their Brief filed on February 6, 2017, as part of this appeal: 1) Order of Sale was Erroneous, Contrary to Law, and not based on Substantial Evidence, 2) Deed of Trust on Parcel 005-U-07 is Defective, 3) Order of Sale stems from a Default Judgment void for violation of Due Process, 4) Statute of Limitation, 5) FSMDB is not a Bank, 6) FSMDB is to assist Customers Realize Profit, not for FSMDB to make Profit.

^[4] FSM Civil Rule 60 governs relief from Judgments or Orders.