FSM SUPREME COURT TRIAL DIVISION
CIVIL ACTION NO. 2018-2003

FSM DEVELOPMENT BANK,
Plaintiff,

vs.

ARTSON S. TALLEY,
Defendant.
___________________________

	ORDER MEMORIALIZING RULINGS

Larry Wentworth
Associate Justice

Hearing:  July 15, 2020
Decided:  July 16, 2020

APPEARANCES:

For the Plaintiff:	Nora E. Sigrah, Esq.
P.O. Box M
Kolonia, Pohnpei FM 96941

For the Defendant:	Yoslyn G. Sigrah, Esq.
P.O. Box 3018
Kolonia, Pohnpei FM 96941

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HEADNOTES

Courts - Recusal - Procedure
The FSM Supreme Court has no mechanism whereby a motion to disqualify a justice may be referred to or assigned to another trial division justice for decision.  The justice to whom the motion is addressed is expected to, and must, rule on the motion.  FSM Dev. Bank v. Talley, 22 FSM R. 608, 610 (Kos. 2020).

Courts - Recusal - Judicial Statements or Rulings
A judge’s adverse rulings made in the course of judicial proceedings do not provide grounds for disqualification under 4 F.S.M.C. 124(1) which provides for a justice’s disqualification when the justice’s impartiality might reasonably be questioned.  FSM Dev. Bank v. Talley, 22 FSM R. 608, 610 (Kos. 2020).

Appellate Review - Stay - Civil Cases - Money Judgment; Debtors’ and Creditors’ Rights - Orders in Aid of Judgment
Collection proceedings against a judgment debtor will not be stayed because the debtor has filed a notice of appeal and has also filed an independent action for relief from the judgment.  The usual method to stay the collection of a money judgment is for the defendant to give a supersedeas bond, and when the judgment debtor did not obtain, and did not offer to obtain, a supersedeas bond, and has not stated any basis upon which the court could exercise its discretion to stay the money judgment against him in absence of a bond, he is not entitled to a stay under FSM Civil Rule 62(d).  FSM Dev. Bank v. Talley, 22 FSM R. 608, 610 (Kos. 2020).

Appellate Review - Stay - Civil Cases - Money Judgment; Debtors’ and Creditors’ Rights - Orders in Aid of Judgment
In the absence of a stay, the court has the ability, and the inclination, to protect a judgment-debtor during an appeal by requiring that all sums the judgment-debtor is ordered to pay, be paid into the court’s registry where the money would be held awaiting the outcome of the judgment debtor’s appeal, with the money delivered to whichever party the appellate court deems proper.  FSM Dev. Bank v. Talley, 22 FSM R. 608, 610-11 (Kos. 2020).

Debtors’ and Creditors’ Rights - Orders in Aid of Judgment
A motion for an order in aid of judgment may be heard by video-conferencing.  FSM Dev. Bank v. Talley, 22 FSM R. 608, 611 (Kos. 2020).

Debtors’ and Creditors’ Rights - Orders in Aid of Judgment
The statute authorizing issuance of an order in aid of judgment, 6 F.S.M.C. 1409, presents two issues:  the debtor’s ability to pay, and the most expeditious way that payment can be accomplished.  Because the court must consider the debtor’s ability to pay, an order which takes this factor properly into consideration will not result, in and of itself, in the debtor’s financial undoing.  FSM Dev. Bank v. Talley, 22 FSM R. 608, 612 (Kos. 2020).

Debtors’ and Creditors’ Rights - Orders in Aid of Judgment

The court is unable to determine a judgment debtor’s ability to pay and the fastest way for the debtor to pay when, although the judgment creditor establishes that the debtor had substantial income, there is no evidence of the debtor’s legitimate financial obligations, such as the amount needed to support dependents.  The court cannot determine if that amount it should order the debtor to pay is greater than or less than the biweekly sum the creditor asked for.  When the court cannot establish with any certainty an appropriate amount, the court has no choice but to deny the motion for an order in aid of judgment, without prejudice to any future order in aid of judgment.  FSM Dev. Bank v. Talley, 22 FSM R. 608, 612 (Kos. 2020).

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COURT’S OPINION

LARRY WENTWORTH, Associate Justice:

On July 15, 2020, this came before the court by video-conference.  The court heard the defendant’s motion to disqualify the presiding justice; the defendant’s motion to stay pending appeal; the defendant’s motion to continue; and the plaintiff’s motion for an order in aid of judgment.  Those motions were denied from the bench.  This order memorializes the court’s rulings on those motions.

I.

The defendant moved to disqualify the presiding justice on the ground that the justice’s prior adverse rulings against defendants in cases where the FSM Development Bank was the plaintiff meant that the presiding justice’s impartiality might reasonably be questioned.  The defendant also asked that the disqualification motion be referred to or be assigned to another unbiased judge to rule on whether the presiding judge is disqualified.

The court denied that motion.  The court has no mechanism whereby a motion to disqualify a justice may be referred to or assigned to another trial division justice for decision; but the justice to whom the motion is addressed is expected to, and must, rule on the motion.  Berman v. College of Micronesia-FSM, 15 FSM R. 582, 589 (App. 2008); Skilling v. FSM, 2 FSM R. 209, 214 (App. 1986); Nahnken of Nett v. United States (I), 6 FSM R. 318, 320 n.1 (Pon. 1994).

A judge’s adverse rulings made in the course of judicial proceedings do not provide grounds for disqualification under 4 F.S.M.C. 124(1) which provides for a justice’s disqualification when the justice’s impartiality might reasonably be questioned.  Halbert v. Manmaw, 20 FSM R. 245, 250 (App. 2015); FSM v. Wainit, 13 FSM R. 293, 295 (Chk. 2005); FSM v. Wainit, 11 FSM R. 424, 431 (Chk. 2003); FSM v. Ting Hong Oceanic Enterprises, 7 FSM R. 644, 649 (Pon. 1996); FSM v. Skilling, 1 FSM R. 464, 473, 484 (Kos. 1984).  This is axiomatic.  The court was therefore required to deny the motion to disqualify.

II.

The defendant also moved to stay all collection proceedings against him because he had filed a notice of appeal from the trial court’s June 17, 2020 decision denying relief from judgment and he had also filed an independent action for relief from the judgment in which he seeks injunctive relief against the bank and relief from the judgment in this case.

The usual method to stay the collection of a money judgment is for the defendant to give a supersedeas bond.  FSM Civ. R. 62(d); Panuelo v. Amayo, 10 FSM R. 558, 563 (App. 2002).  The defendant did not obtain, and did not offer to obtain, a supersedeas bond.  When defendants have not posted a supersedeas bond and have not stated any basis upon which the court could exercise its discretion to stay the money judgment against them in absence of a bond, they are not entitled to a stay under FSM Civil Rule 62(d).  Adams v. Island Homes Constr., Inc., 12 FSM R. 348, 350 (Pon. 2004).

The court noted that, even in the absence of a stay, it had the ability, and the inclination, to protect a judgment-debtor during an appeal by requiring that all sums the judgment-debtor is ordered to pay, be paid into the court’s registry where the money would be held awaiting the outcome of the judgment debtor’s appeal, with the money delivered to whichever party the appellate court deems proper.

Accordingly, the defendant’s motion to stay was denied.

III.

The defendant also moved to continue the proceeding while his counsel sought clarification from the FSM Chief Justice about whether his Emergency Court Order No. 1, which allows video-conferencing in civil cases, was meant to permit video-conferencing evidentiary hearings such as this hearing on the bank’s motion for an order in aid of judgment.  The defendant brought this up as a preliminary matter, but since the defendant’s other two motions were not evidentiary matters, the court deferred consideration of the motion to continue until after the defendant’s other two motions because if the defendant obtained a favorable ruling on either of those two motions the motion to continue would become moot.

The court denied this motion because the Chief Justice’s Emergency Order No. 1 seemed clear when it stated that "[t]he FSM Judiciary will allow or require anyone involved in any civil hearing . . . or other proceeding of any kind, including a party, attorney, or witness to participate remotely such as by teleconferencing, videoconferencing, or other means."  FSM Nat’l Judiciary Emergency Order No. 1 at 2 (Apr. 3, 2020).

IV.

The court then proceeded to hear the plaintiff-judgment-creditor’s motion for an order in aid of judgment.  The defendant’s counsel objected to any evidentiary hearing of any kind, conducted by video-conferencing and declined to participate further although the court refused to permit her to absent herself.

The plaintiff called two witnesses whose testimony was limited to authenticating various documents establishing Artson S. Talley’s income from U.S. military retirement benefits and from his current employment by the FSM Congress delegation office on Kosrae.  These documents had been filed and served by the plaintiff days before the hearing and were mostly copies of documents that the defendant had, or had at one time, been in Talley’s personal possession.  Because of this, the court admitted those exhibits over the defendant’s continuing objection.  Talley was not called to testify.  The bank established that Talley received $1,530.71 per month in U.S. military benefits and $538.26 per biweekly pay period (usually $437.89 take home).

(As part of the defendant’s continuing objection to holding an evidentiary hearing by video-conferencing, the defendant noted that the usual method to authenticate an exhibit is for counsel to first show the document to opposing counsel and then to the witness so that everyone is certain which document is under discussion.  This point has merit.  So the court, after the hearing, directed the court’s technical staff to alter the court’s video-conferencing protocol so that the document or exhibit under discussion will simultaneously appear on the video-conferencing screen in future hearings of this nature.)

The court was satisfied that the bank had established the amount of Talley’s current income.  The bank asked that therefore Talley’s salary be garnished at the rate of $282.38 per biweekly pay period in accordance with the defendant’s assignment of salary at the rate of $611.83 a month, which he had executed when he had originally obtained the, now unrepaid, loan from the bank.

The statute authorizing issuance of an order in aid of judgment, 6 F.S.M.C. 1409, presents two issues:  the debtor’s ability to pay, and the most expeditious way that payment can be accomplished.  Louis v. Kutta, 8 FSM R. 312, 316 (Chk. 1998).  Because the court must consider the debtor’s ability to pay, an order which takes this factor properly into consideration will not result, in and of itself, in the financial undoing of a debtor.  Davis v. Kutta, 8 FSM R. 338, 344 (Chk. 1998).

While the bank did establish that Talley had substantial income, without any evidence of his legitimate financial obligations, such as the amount needed to support dependents, the court was unable to determine Talley’s ability to pay and the fastest way that Talley can pay the judgment.  It could be that that amount is greater than the $282.32 biweekly that the bank asked for, or it could be that that amount is substantially less than the amount the bank sought.  The court has no way to determine that.

Since the court had no way of establishing with any certainty an appropriate amount, the court had no choice but to deny the motion for an order in aid of judgment, without prejudice to any future order in aid of judgment.

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