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People of Tomil ex rel. Mar v MC Jumbo Rock Carrier III [2009] FMSC 52; 16 FSM Intrm. 633 (Yap 2009) (4 December 2009)

FSM SUPREME COURT TRIAL DIVISION

CIVIL ACTION NO. 2009-3002

THE PEOPLE OF THE MUNICIPALITY OF TOMIL, YAP, by and through CHIEF STEVEN MAR, CHIEF ALEX GILTAMNGIN, and CHIEF ROBERT FITHING,
Plaintiffs,

vs.

M/C JUMBO ROCK CARRIER III and M/T PAGBILAO I, in rem, their engines, masts, bowsprits, boats, anchors, chains, cables, rigging, apparel, furniture and all necessaries thereunto pertaining;

and

IDHI PORTS & SHIPPING, INC.,
In Personam Defendant.

ORDER DENYING INTERLOCUTORY SALE

Dennis K. Yamase
Associate Justice

Decided: December 4, 2009

APPEARANCES:

For the Plaintiffs: Joseph C. Razzano, Esq. (pro hac vice)
Teker Torres & Teker, P.C.
Suite 2A, 130 Aspinall Avenue
Hagatna, Guam 96910

For the Defendants: Manuel N. Camacho, Esq. (pro hac vice)
Camacho & Associates Law Offices
8th Floor, Fort Legend Tower
Corner 3rd Avenue, 31st Street
Global City, Taguig
1634 Philippines

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HEADNOTES

Civil Procedure – Motions

Failure to oppose a motion is generally deemed a consent to the motion, but even if there is no opposition, the court still needs good grounds before it can grant the motion. People of Tomil ex rel. Mar v. M/C Jumbo Rock Carrier III, [2009] FMSC 52; 16 FSM Intrm. 633, 634 (Yap 2009).

Admiralty – Ships

Interlocutory sales of arrested vessels are allowed 1) if the property that has been attached is perishable or liable to injury by being detained in custody pending the action, or 2) if the expense of keeping the property is excessive or disproportionate, or 3) if there is unreasonable delay in securing the release of the property. The plaintiffs need only demonstrate that one of these three conditions is present to justify the vessels' interlocutory sale. People of Tomil ex rel. Mar v. M/C Jumbo Rock Carrier III, [2009] FMSC 52; 16 FSM Intrm. 633, 634-35 (Yap 2009).

Admiralty

Although the court must first look to FSM sources of law rather than begin with a review of cases decided by other courts when the FSM Supreme Court has not previously construed an FSM Supplemental Admiralty and Maritime Rule which is identical or similar to a U.S. counterpart, the court may consult U.S. sources construing the U.S. rule. People of Tomil ex rel. Mar v. M/C Jumbo Rock Carrier III, [2009] FMSC 52; 16 FSM Intrm. 633, 635 n.1 (Yap 2009).

Admiralty – Ships

Where there is no evidence that the vessels are currently deteriorating or liable to injury and where the defendants have unsuccessfully sought the vessels' release through a letter of undertaking and made a good faith attempt to modify the proposed letter to satisfy the plaintiffs' and the court's concerns but were unable to, resulting in a court denial, the four months' delay in the vessels' release cannot yet be considered unreasonable, especially when the defendants, not the plaintiffs, are currently bearing the expenses of keeping the vessels. The request for an interlocutory sale of the arrested vessels will thus be denied without prejudice, but, if the vessels' release is not obtained, there will come a time when the delay will be considered unreasonable and the vessels' interlocutory sale could be ordered. People of Tomil ex rel. Mar v. M/C Jumbo Rock Carrier III, [2009] FMSC 52; 16 FSM Intrm. 633, 635-36 (Yap 2009).

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COURT'S OPINION

DENNIS K. YAMASE, Associate Justice:

On October 22, 2009, the plaintiffs filed their Motion for Interlocutory Sale of the Vessels with a supporting memorandum. No opposition was filed. Failure to oppose a motion is generally deemed a consent to the motion, FSM Civ. R. 6(d), but even if there is no opposition, the court still needs good grounds before it can grant the motion. Senda v. Mid-Pacific Constr. Co., [1994] FMSC 20; 6 FSM Intrm. 440, 442 (App. 1994). The plaintiffs then filed their Request for Entry of Order on Plaintiffs' Motion for Interlocutory Sale of Vessels and the defendants filed their opposition to the request.

I.

The plaintiffs contend that their motion for the vessels' interlocutory sale should be granted because, in their view, the defendants have delayed the matter for four months without meaningful efforts to release the vessels and because storms have threatened to injure the vessels and to damage Colonia harbor and the people of Yap. The plaintiffs also note that they "have fulfilled the obligation to publish notice to potential creditors or intervenors, and no such parties have come forward," and they therefore contend that an interlocutory sale, unencumbered by any other claims by any other parties, would lead to the litigation's speedy resolution.

The FSM Supplemental Rules for Certain Admiralty and Maritime Claims allow for interlocutory sales of arrested vessels [1] "[i]f [the] property that has been attached is perishable or liable to injury by being detained in custody pending the action, or [2] if the expense of keeping the property is excessive or disproportionate, or [3] if there is unreasonable delay in securing the release of [the] property . . . ." FSM Mar. R. E(7)(b). The plaintiffs need only demonstrate that one of these three conditions is present to justify the vessels' interlocutory sale. See Silver Star Enterprises v. M/V Saramacca, [1994] USCA5 1394; 19 F.3d 1008, 1014 (5th Cir. 1994); 20th Century Fox Film Corp. v. M/V Ship Agencies, 992 F. Supp. 1434, 1438 (M.D. Fla. 1997).[1]

II.

The defendants correctly note that they are the ones who are bearing the expenses of maintaining the vessels and that there is no evidence that the vessels are currently deteriorating or liable to injury. That leaves whether the four months since the vessels' arrest without their release is an unreasonable delay. The defendants assert that since their motion to approve their proposed letter of undertaking was not denied until November 6, 2009 and that the denial was without prejudice shows that there has not been an unreasonable delay.

In Ferrous Financial Services Co. v. O/S Arctic Producer, 567 F. Supp. 400, 401 (W.D. Wash. 1983), the court held that four months was an unreasonable delay and ordered an interlocutory sale of the vessel when no attempt had been made to release the vessel and the cost of keeping the vessel had already required the expenditure of $48,000. In Merchants National Bank v. Dredge General G.L. Gillespie, 663 F.2d 1338, 1341-42 (5th Cir. 1981), the court concluded eight months was an unreasonable delay and that the trial court did not err in ordering an interlocutory sale when the barges were taking on water and had to be pumped and the expenses were over $17,000 per month and the defendants had not tried to secure the vessels' release. In Silver Star Enterprises v. M/V Saramacca, [1994] USCA5 1394; 19 F.3d 1008, 1014 (5th Cir. 1994), the court held that an interlocutory sale of a vessel was proper since the seven-month delay between the vessel's arrest and the court's sale order was an unreasonable delay for the vessel's owner to post security. And in 20th Century Fox Film Corp. v. M/V Ship Agencies, 992 F. Supp. 1434, 1438 (M.D. Fla. 1997), an eight-month delay with no release in sight and adjudication on the merits months away was held unreasonable and an interlocutory sale ordered.

The court concludes that in this case, where the defendants have unsuccessfully sought the vessels' release through a letter of undertaking and made a good faith attempt to modify the proposed letter to satisfy the plaintiffs' and the court's concerns but were unable to, resulting in the court's November 16, 2009 denial, the delay cannot yet be considered unreasonable, especially since the defendants, not the plaintiffs, are currently bearing the expenses of keeping the vessels.

Accordingly, the request for an interlocutory sale of the arrested vessels is denied without prejudice. The defendants, however, are cautioned that if the vessels' release is not obtained, there will come a time when the delay will be considered unreasonable and the vessels' interlocutory sale could be ordered.

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^[1] Although the court must first look to sources of law in the FSM rather than begin with a review of cases decided by other courts, see FSM Const. art. XI, §&#160when anen an FSM court has not previously construed an FSM civil procedure rule which is identical or similar to a U.S. counterpthe court may look to U.S. sources for guidance in interpreting the rule, see, e.g.,, Berman v. College of Micronesia-FSM, [2008] FMSC 32; 15 FSM Intrm. 582, 589 n.1 (App. 2008); Arthur v. FSM Dev. Bank, [2006] FMSC 59; 14 FSM Intrm. 390, 394 n.1 (App. 2006); Bualuay v. Rano, [2002] FMSC 30; 11 FSM Intrm. 139, 146 n.1 (App. 2002); Senda v. Mid-Pacific Constr. Co., [1994] FMSC 20; 6 FSM Intrm. 440, 444 (App. 1994). Since the Admiralty and Maritime Rules supplement the civil procedure rules and FSM Supplemental Admiralty and Maritime Rule E(7)(b) is similar to U.S. Supplemental Rule E(9)(b) and the FSM rule has not been previously construed, the court may consult U.S. sources construing its rule.