HEADNOTES

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COURT'S OPINION

ANDON L. AMARAICH, Chief Justice:

1. Introduction

     This appeal is from a judgment entered on April 8, 1999 in favor of defendants and appellees Kotaro Wakuk, Iuver Joseph and Utwe Municipal Government and against plaintiff and appellant Edward Tulensru. The complaint involves multiple causes of action sounding in both tort and contract, with the tort claims arising out of and dependant upon conduct allegedly constituting breach of contract. This appeal involves only the breach of contract claim, however, because the Kosrae State Court found that the contract at issue was not breached. Therefore, the tort causes of action, all of which are derivative of the contract claim, were deemed without merit and dismissed.

       The principal issue raised by this appeal concerns the adequacy of the trial court's factual finding that all parties fulfilled their obligations under the contract. Tulensru also contends that the trial court erred as a matter of law with respect to a ruling that his failure to produce copies of two checks allegedly issued as payment owed him under the contract violated the "best evidence" rule.

      The record in this case does not support a finding of error as to the trial court's factual determinations. The testimony offered at trial by the appellees affirmatively demonstrates that they fulfilled their obligations under the contract, while the testimony offered by Tulensru that they did not was weak and ambiguous at best. Accordingly, the trial court found that appellant Tulensru failed in his burden of proof on fact issues. That finding was not clearly erroneous. We therefore affirm.

[10 FSM Intrm. 131]

2. Factual Background

     In 1991 the late Mayor of Utwe, Tedrick Melander (deceased as of the time the complaint was filed), entered into a verbal agreement with Edward Tulensru. The agreement provided that Melander would be permitted to haul fill material from Tulensru's land as long as he delivered to Tulensru's residence one load of fill material for every five loads he took. The fill material was to be used at Melander's beach side property as well as for certain Utwe municipal projects. In the alternative to delivering loads of fill, Tulensru claims that Melander agreed he would pay Tulensru five dollars for each load taken.

     Later, in 1996 Tulensru contracted with Tedrick Melander's successor, Mayor Kotaro Wakuk, for Utwe's use of fill material from Tulensru's land. Thereafter, fill was taken from Tulensru's property for use in Utwe municipal projects. Mayor Wakuk testified at trial that his agreement with Tulensru (made on behalf of Utwe) did not involve monetary compensation. Instead, Wakuk agreed that Utwe would either deliver one load to Tulensru for every five taken or two loads for each day of hauling. Tulensru on the other hand testified that the terms of his agreement with Wakuk were the same as those agreed upon with Melander.

     In either event, the parties acknowledge that a valid contract existed. Their dispute is over performance with Tulensru contending that the appropriate number of loads were not delivered as promised and the defendants asserting that they provided Tulensru with all fill deliveries required under the agreement and owe him nothing more.

     The single issue tried was whether Utwe breached the contract by failing to deliver loads to Tulensru as promised or by failing to pay Tulensru in cash for fill material that was taken without compensation in the form of load deliveries at the agreed upon ratio of one for five or two truckloads on each day fill was hauled. The trial was bifurcated between issues of liability and damages in response to a motion filed by Tulensru.

     At trial Tulensru testified to his belief that an insufficient number of loads were delivered to his residence during the 1991 and 1996 hauling operations, but he did not specify how many loads were in fact delivered or how many he believed should have been supplied. He admitted to not keeping track of this stating his belief that Utwe was doing so. For the same reason, he was further unable to state how much money was owed to him by any of the defendants.

     Tulensru did not offer documentary evidence showing when the hauling occurred or how many loads were taken. Similarly, he did not offer the testimony of any witness to the hauling activities. Nor did he introduce photographs depicting the volume of fill removed from his quarry, the amount delivered to his residence, or the amount utilized in any of Utwe's municipal projects.

      On the other hand, defendants Utwe, Wakuk and Joseph offered evidence that the contract terms were met in full. Multiple defense witnesses testified that loads of fill were delivered to Tulensru as promised under the 1996 agreement so as to fully satisfy Utwe's obligations to Tulensru. While there was no defense testimony specific to deliveries of fill pursuant to the 1991 agreement, Tulensru was not able to specify the amount of any alleged shortfall. He could only state that some but not all of the required deliveries were made. But he also testified that Melander paid him $500 in 1991 as compensation for loads of fill taken under that agreement.

     Additionally, Tulensru testified that the 1991 payment of $500 by Melander was from proceeds received when Melander cashed a $3,000 check made out in Tulensru's name after Tulensru endorsed it at Melander's urging. According to Tulensru, Melander kept $500 in cash from that check and

[10 FSM Intrm. 132]

deposited the remaining $2,000 in an unidentified account. This testimony was not corroborated.

     Tulensru also spoke of a $5,000 check made out in his name in 1996 which was voided by Utwe after he refused to endorse it because Utwe intended on keeping the proceeds for use in municipal projects. Tulensru did not produce copies of these checks nor did he offer evidence that either was unavailable. The defendants, however, acknowledged the existence of the $5,000 check but explained that it was never intended as compensation for fill taken from Tulensru's land. Rather, several defense witnesses testified the money was requisitioned for use in other municipal projects for which additional needed proceeds were not otherwise available.

      On the strength of the defendants' affirmative testimony that Utwe delivered loads of fill to Tulensru as promised, and the weakness in Tulensru's uncertain testimony concerning the defendants' alleged failure to fulfill the contract terms, the trial court found that the contracts were not breached. The trial court also ruled in favor of the defendants on the dispute over contract terms finding that Utwe's promise was to deliver two loads of fill for each day of hauling and that Utwe made these deliveries as agreed.

      The trial court further ruled that Tulensru failed to carry his burden of proof on either of the two checks issued in his name. For this aspect of the ruling the trial court referred to the "best evidence rule" embodied by Kosrae Rules of Evidence, Rules 1001 through 1004.

3. Standard of Review

     The standard of review of a trial court's factual findings is whether those findings are clearly erroneous. Senda v. Mid-Pac Constr. Co., 5 FSM Intrm. 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 Intrm. 307, 309 (App. 1993). An appellate court should not set aside a finding of fact where there is credible evidence in the record to support that finding in part because the trial court, unlike the appellate court, had the opportunity to view the witnesses' demeanor and the manner of their testimony. Nakamura v. Bank of Guam (II), 6 FSM Intrm. 345, 349 (App. 1994). If, upon reviewing all the evidence in the record, the appellate court is left with a definite and firm conviction that a mistake has been made, it may then conclude that the trial court's finding was clearly erroneous, but it cannot substitute its judgment for that of the trial court. Hadley v. Bank of Hawaii, 7 FSM Intrm. 449, 452 (App. 1996).

     Issues of law, on the other hand, are reviewed de novo on appeal. Nanpei v. Kihara , 7 FSM Intrm. 319, 323-24 (App. 1995). 

 4. Discussion

1. Factual Findings Concerning Breach of Contract

      The first of the two issues which appellant Tulensru raises is that the trial court's findings of fact were clearly erroneous. After hearing all the evidence the trial court determined that both parties fulfilled their obligations under the contract. At trial, Tulensru had the burden of proving each element of his breach of contract claim by a preponderance of the evidence. If he failed to do so, it was appropriate for the trial court to enter judgment against him. See Meitou v. Uwera, 5 FSM Intrm. 139, 141-42 (Chk. S. Ct. Tr. 1991).

      The question initially presented was whether the defendants delivered loads of fill as agreed. If they did, there would be no breach of contract and no basis for liability under any of the claims

[10 FSM Intrm. 133]

asserted by Tulensru. On this critical point, Tulensru testified on cross examination during his case-in-chief that he could not recall how many loads Melander had provided. Later, on cross examination as a rebuttal witness, and when given a second opportunity to testify whether defendants had failed to provide the required number of loads, Tulensru testified that he had not kept track of the number of loads; that the defendants kept the records; and that he did not remember any deliveries being made to his place.

      We turn to Tulensru's second issue, whether any error resulted when the trial court referred to the so-called "best evidence" rule in the Memorandum of Decision which it issued after trial.

2. Application of the "Best Evidence" Rule

      After citing to Rules 1001 through 1004 in its Memorandum of Decision under the heading labeled "Findings of Fact," the trial court concluded that the plaintiff "failed to sustain his burden of proof with respect to the alleged check[s]." [Tulensru v. Utwe, 9 FSM Intrm. 95, 97 (Kos. S. Ct. Tr. 1999).] The Memorandum does not specify whether this reference is to the existence of the checks, if it pertains to their terms, or if it involves plaintiff's attempted showing that the proceeds were rightfully his. However, no party raised a best evidence objection during the trial. More importantly, the trial court did not preclude or limit the introduction of evidence about either check. Indeed, both were involved in much of the testimony offered by the plaintiff and both formed the subject of direct examination testimony by defense witnesses as well. The trial judge himself questioned defense witnesses at length concerning these two checks. Moreover, defense witnesses acknowledged the existence of both checks and did not dispute the amount of either one or the fact that both were made out in Tulensru's name.

      On the record before us, the trial court cannot be said to have applied the "best evidence" rule, which is exclusionary in character, and requires the production of originals unless specified exceptions are met. Kos. Evid. R. 1002, 1004. The trial court's reference to the rule in its Memorandum of Decision appears to have been an extraneous comment on the weight of the evidence, since after having considered the evidence relating to the checks, as well as extensive additional evidence relating to the disputed contract, the court concluded that the plaintiff had not met his burden of proof on the breach of contract claim.

[10 FSM Intrm. 134]

      The only significance of plaintiff's failure to offer the checks as evidence was the effect of such failure on the weight given to Tulensru's testimony on the dollar value of the first check. The weight to be accorded admissible evidence is for the trier of fact to determine. The defendants did not dispute the $5,000 figure of the second check from 1996, but no witness other than Tulensru testified on the value of the first check allegedly procured in 1991. Even if both checks had been introduced into evidence, plaintiff would have had the same burden of proving that he was entitled to the proceeds as consideration under the contract, which he failed to do. The trial court properly found that the plaintiff had not met his burden of proof.

      Accordingly, the judgment of the trial court is affirmed.