FSM SUPREME COURT APPELLATE DIVISION
Cite as Kosrae Credit Union v. Palik,
10 FSM Intrm. 134 (App. 2001)
 
[10 FSM Intrm. 134]
 
KOSRAE CREDIT UNION,
Appellant,
 
vs.
 
WINTON PALIK, ASHLEY JACKSON
and DAISY JACKSON,
Appellees.
 
APPEAL CASE NO. K7-1999
C.A. NOS. 7-96, 9-96 & 21-96
_______________________________________________
 
KOSRAE ISLAND CREDIT UNION,
Appellant,
 
vs.
SEMEON SIGRAH, EUGENE PALSIS
and KEISA PALSIS,
Appellees.
 
APPEAL CASE NO. K8-1999
C.A. NOS. 18-96, 6-96 & 17-96
 
OPINION
 
Submitted: September 6, 2000
 
Decided: April 11, 2001
 
BEFORE:
 
Hon. Andon L. Amaraich, Chief Justice, FSM Supreme Court
Hon. Martin G. Yinug, Associate Justice, FSM Supreme Court
Hon. Judah C. Johnny, Temporary Justice, FSM Supreme Court*
 
*Chief Justice, Pohnpei Supreme Court, Kolonia, Pohnpei
 
[10 FSM Intrm.135]
 
APPEARANCE:
 
For the Appellant:                               Delson Ehmes, Sr., Esq.
                                                             P.O. Box 1018
                                                             Kolonia, Pohnpei FM 96941
 
* * * *
 
HEADNOTES
 
Appeal and Certiorari
     When the issue in both appeals is identical, the cases may be consolidated for purposes of rendering an opinion. Kosrae Island Credit Union v. Palik, 10 FSM Intrm. 134, 136 (App. 2001).
 
Appeal and Certiorari ) Standard of Review; Civil Procedure ) Dismissal
     Unless the court otherwise specifies, an involuntary dismissal pursuant to Rule 41(b) acts as an adjudication upon the merits, and is generally reviewed for abuse of discretion. Kosrae Island Credit Union v. Palik, 10 FSM Intrm. 134, 137 (App. 2001).
 
Appeal and Certiorari ) Standard of Review
     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. Kosrae Island Credit Union v. Palik, 10 FSM Intrm. 134, 138 (App. 2001).
 
Appeal and Certiorari ) Standard of Review; Civil Procedure ) Dismissal
    The abuse of discretion standard is usually applied in reviewing a Rule 41(b) dismissal when there is no substantial dispute over the facts underlying the trial court's determination that the plaintiff had failed to prosecute the action. In such instances the analysis turns instead on whether the circumstances surrounding the delay justify dismissal. Kosrae Island Credit Union v. Palik, 10 FSM Intrm. 134, 138 (App. 2001).
 
Appeal and Certiorari ) Standard of Review; Civil Procedure ) Dismissal
     When reviewing a trial court's Rule 41(b) dismissal order on sufficiency of the evidence, the appropriate standard of review is whether the findings of fact are clearly erroneous. A finding is clearly erroneous when the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed. Kosrae Island Credit Union v. Palik, 10 FSM Intrm. 134, 138 (App. 2001).
 
Appeal and Certiorari ) Standard of Review; Civil Procedure ) Dismissal
     When an appellant takes issue with both the trial court's findings of fact and its subsequent dismissal order, it requires a two tier analysis. The appellate court first reviews the trial court's findings of fact for clear error. Thereafter, it applies the facts found that are not clearly erroneous, together with those shown by the record as undisputed, and reviews the Rule 41(b) dismissal order under an abuse of discretion standard. Kosrae Island Credit Union v. Palik, 10 FSM Intrm. 134, 138 (App. 2001).
 
Civil Procedure ) Dismissal
     Dismissal under Rule 41(b), like Rule 37, should be allowed only in the face of a clear record of delay or contumacious conduct by the plaintiff, or upon a serious showing of willful default. Kosrae Island Credit Union v. Palik, 10 FSM Intrm. 134, 140 (App. 2001).
 
[10 FSM Intrm. 136]
 
Civil Procedure; Civil Procedure ) Dismissal
     A plaintiff in a civil lawsuit seeking affirmative relief has the burden of pursuing that relief with reasonable diligence. Initially, the burden of showing some excuse for any delay in prosecution ought to be borne by the plaintiff. If the excuse is anything but frivolous, the burden shifts to the defendant to show prejudice from the delay. If prejudice is demonstrated, the burden shifts back to the plaintiff to show that the force of its excuse outweighs any prejudice to the defendant. Kosrae Island Credit Union v. Palik, 10 FSM Intrm. 134, 140 (App. 2001).
 
Civil Procedure) Dismissal
     Although ultimately the granting or denial of involuntary dismissal rests in the sound discretion of the court, the record must still support a finding of delay attributable to plaintiff's conduct. Kosrae Island Credit Union v. Palik, 10 FSM Intrm. 134, 140 (App. 2001).
 
Civil Procedure ) Dismissal
     When plaintiff's counsel did not receive formal notice of the Kosrae trial date until six days before trial and he acted reasonably in attempting to travel to Kosrae, and given the effort counsel previously made to try these cases, counsel's inability to make the flight did not justify the trial court's dismissal order because counsel had not acted willfully or out of disdain for the trial court's authority. Considering the minimal three day continuance requested by counsel and the absence of prejudice to the defendants, the trial court abused its discretion in ordering the cases' dismissal. Kosrae Island Credit Union v. Palik, 10 FSM Intrm. 134, 140 (App. 2001).
 
* * * *

COURT'S OPINION

ANDON L. AMARAICH, Chief Justice:

1. Introduction

     These two appeals arise from six orders of dismissal entered by the Kosrae State Court on May 18, 1999 in Civil Action Nos. 6-96, 7-96, 9-96, 17-96, 18-96 and 21-96. Complaints in all six of the underlying matters were filed by plaintiff and appellant Kosrae Island Credit Union (KICU) on January 17, 1996. Each involves a single cause of action for breach of contract allegedly resulting from the defendant-appellees' failure to make payment on KICU loans of differing amounts. KICU was represented by the same attorney in each of the cases. As a result, the trial court managed them as a group with hearings scheduled on the court's calendar at or about the same time. In keeping with this practice, the cases were set for trial on May 18, 1999 and when counsel for KICU did not appear, all were dismissed for failure to prosecute pursuant to Rule 41 of the Kosrae Rules of Civil Procedure. These appeals ensued.

     The single issue presented by both appeals is whether the Kosrae State Court abused its discretion in ordering these cases dismissed upon a factual determination that KICU had repeatedly failed to prosecute without proper justification.

     Since the issue in both appeals is identical, we consolidate these cases in accordance with FSM Appellate Rule 3(b) for purposes of rendering our opinion. Weno v. Stinnett, 9 FSM Intrm. 200, 205

[10 FSM Intrm. 137]

(App. 1999).

     As more fully described below, the record demonstrates that the Kosrae State Court clearly erred in its factual finding that appellant KICU was responsible for the multiple trial continuances attributed to it. Furthermore, under the facts shown by the record it would be an abuse of discretion to conclude that KICU failed to timely prosecute the cases. We therefore reverse.

2. Introductory Facts Surrounding Orders of Dismissal

     On the afternoon of May 18, 1999, the matters at issue here were called for trial in Kosrae, the Honorable Aliksa B. Aliksa presiding. Appearances were made on behalf of all six defendants. Counsel for KICU did not appear, however, having filed a motion the previous day requesting an order continuing the trial for three days until May 21, 1999. The motion was premised on the grounds that counsel had been unable to secure a seat on the May 17th flight from Pohnpei to Kosrae. In the motion, counsel indicated that he had blocked off the entire week of May 16, 1999 for trials in Kosrae based on information supplied earlier by the Kosrae State Court clerk's office. However, he did not receive notice that the trials would begin on May 18, 1999 until May 12, 1999 after returning to his office from approximately nine days of illness.2 At that point he attempted to make a reservation for the Pohnpei to Kosrae flight scheduled for May 17, 1999 but could not obtain a confirmed seat. According to counsel's affidavit attached to the motion, seats were available on Friday the 14th of May but he was scheduled to appear before the Pohnpei Supreme Court that day and had personal obligations over the weekend. Thus he was prevented from leaving at that time. The motion for a brief continuance was fax-filed on the morning of May 17, 1999 only after counsel remained unable to obtain a confirmed seat on that day's flight. It was served on counsel for defendants and was reviewed by the court prior to trial.

     After calling the cases of KICU v. Ashley Jackson, Civil Action No. 9-96, and KICU v. Daisy Jackson , Civil Case No. 21-96, the trial court stated its view that counsel for KICU was engaging in a pattern of failing to prosecute the cases having requested and received multiple prior continuances. Referring to case number 9-96, the court stated that the matter was first set for trial in May 1998 but was continued at the request of plaintiff's counsel. The court went on to state its view that the case was set for trial five more times with all but one of the continuances occurring at the behest of counsel for KICU or otherwise resulting from plaintiff's failure to prosecute. Unwilling to allow further delay and finding no good reason for granting yet another continuance, the court ordered all the cases addressed by this appeal dismissed for failure to prosecute under Kosrae Rule of Civil Procedure 41(b).

3. Standard of Review

     Rule 41(b) of the Kosrae Rules of Civil procedure controls the involuntary dismissal of actions. The rule finds its origin in FSM Civil Rule 41(b) which in turn is drawn from Rule 41(b) of the U.S. Federal Rules of Civil Procedure. Damarlane v. United States, 8 FSM Intrm. 45, 53 n.5 (App. 1997). The language in each of these rules controlling dismissals for failure to prosecute is identical. Unless the court otherwise specifies, an involuntary dismissal pursuant to the rule acts as an adjudication upon the merits. A dismissal pursuant to Rule 41(b) is generally reviewed for abuse of discretion. Id. at 59.

[10 FSM Intrm. 138]

"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." Jano v. King, 5 FSM Intrm. 326, 330 (App. 1992).

     The abuse of discretion standard is usually applied in reviewing a Rule 41(b) dismissal when there is no substantial dispute over the facts underlying the trial court's determination that the plaintiff had failed to prosecute the action. In such instances the analysis turns instead on whether the circumstances surrounding the delay justify dismissal.

     The appellant here, KICU, frames the issue as calling for a determination of whether the Kosrae State Court abused its discretionary authority to dismiss cases for failure to prosecute. The initial focus of KICU's argument, however, is that the trial court's factual findings as to plaintiff's role in causing the delays were not supported by substantial evidence. When reviewing a trial court's order of dismissal under Rule 41(b) on sufficiency of the evidence, the appropriate standard of review is whether the findings of fact are clearly erroneous. Damarlane, 8 FSM Intrm. at 53. "A finding is clearly erroneous when the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed." Worswick v. FSM Telecomm. Corp., 9 FSM Intrm. 460, 462 (App. 2000).

     Because KICU takes issue with both the trial court's findings of fact and its subsequent order of dismissal, these appeals require a two tier analysis. We first review the trial court's findings of fact for clear error. Thereafter, we apply the facts found that are not clearly erroneous, together with those shown by the record as undisputed, in reviewing the Rule 41(b) dismissal order under an abuse of discretion standard.

4. Appellant's Contention of Factual Errors

     Appellant KICU contends that the trial court's findings of fact concerning KICU's requests for continuances and failure to prosecute were clearly erroneous and are not supported by the evidence. Specifically, KICU argues that on more than one occasion continuances were granted in response to requests made not by KICU, but by one or more of the appellees or their various counsel. A thorough review of the record supports KICU's position in this regard. The clearest picture of what transpired in the cases underlying these appeals is provided by a chronologic recitation of the history of Civil Case No. 9-96. This case is the one cited by the trial court as demonstrating a pattern of failures to prosecute by the plaintiff.

5. Facts of Case as Shown by Record

     On January 29, 1996, twelve days after the complaint was filed, defendant-appellee Ashley Jackson was served with summons and complaint. On March 19, 1996 Jackson's default was entered and on August 12, 1996 KICU filed a motion requesting entry of default judgment. The first status conference in this matter was scheduled for March 27, 1997 but it did not occur due to a continuance requested by Jackson's counsel.

     On February 24, 1998 the court issued an order setting trial for the first time for May 27, 1998. On April 21, 1998, KICU filed a motion to enlarge the time for trial in which counsel cited a calendar conflict due to ministry training obligations and unrelated financial difficulties. The court granted this motion on May 5, 1998 and reset the trial for July 8, 1998 at which time the matter was actually called for the first time. Trial did not proceed then, however, because Jackson's counsel was in the hospital and understandably could not appear. Trial was then reset a third time for August 24, 1998. But a

[10 FSM Intrm.139]

further continuance was ordered, this time on the court's own motion. This new setting ) the fourth ) called for trial to begin on September 23, 1998.

     On September 23, 1998, counsel for both parties appeared at trial for the first time. Counsel for plaintiff KICU answered ready and was willing to proceed but defendant Jackson requested a continuance to prepare new counsel. The court granted defendant's oral motion and, for a fifth time, set the case for trial with December 9, 1998 chosen as the new date.

     When the matter was called as noticed, both parties appeared and counsel for KICU again answered ready. Once more, however, counsel for Jackson (not KICU) requested a continuance on the grounds that he was not ready to proceed. As before, the court granted defendant's oral motion for a continuance and set the trial for a sixth time for May 2, 1999.

     On May 11, 1999, the court entered and served a revised order setting trial for May 18, 1999, providing counsel for KICU (a resident of Pohnpei) only one week notice of this new trial date - the seventh. According to an affidavit filed by counsel for KICU in support of only his second request to continue the trial, he was sick and out of his office from May 3, 1999 until May 12, 1999. Upon returning to work on the twelfth of May, he immediately attempted to book a seat on the Continental flight to Kosrae scheduled to arrive on the morning of May 17, 1999. He was unable, however, to obtain a confirmed reservation on that flight. Business and personal conflicts prevented him from leaving any earlier.

     On the morning of May 17, 1999, after learning that only stand-by seats remained on the flight, counsel for KICU hastily prepared and fax-filed a motion to continue the trial for three days until May 21, 1999. Despite this request and without regard for counsel's predicament, the matter was nevertheless called for trial on May 18, 1999 as scheduled. At that time, both the court and opposing counsel acknowledged receipt of KICU's written motion to enlarge the time for trial by three days. The court also expressed its belief that KICU was engaging in a pattern of failing to prosecute the case, cited the multiple trial settings, and concluded that KICU was responsible for most of the delays. The court then issued an order from the bench (which was later followed by a written order of the same date) dismissing all six cases subject to this appeal pursuant to Rule 41 on the grounds of failure to prosecute.

6. Discussion

     The conclusion reached by the trial court is not supported by the record. The facts clearly show that prior to May 17, 1999, KICU had only moved for one continuance. Moreover, unlike all of the several continuances requested by Jackson's attorneys, KICU's single previous request came in the form of a properly noticed written motion stating good grounds and amply supported by admissible evidence.

     The record demonstrates that counsel for KICU traveled from Pohnpei to Kosrae at least three times ready to proceed with trial only to be turned away as a result of defendant's lack of preparedness or illness of her counsel. On each of these occasions KICU's attorney was not given advanced warning and continuances were provided although no written motions were ever filed.

     The record also shows that on several occasions the trial court contributed to the delays by continuing trial dates on its own motions. While we appreciate the needs of a trial court in controlling its docket, delays of this sort must not unduly prejudice the parties in their ability to proceed to trial. Unfortunately, it appears here that some of the delays attributed to KICU and which resulted in the terminating sanction of dismissal were those which are sometimes inevitably attendant upon the way

[10 FSM Intr. 140]

a case moves through a trial court. The record as it pertains to delays occurring in each of the other five cases is either identical or very similar. Therefore, we will not repeat their entire history for the sake of brevity.

      Consequently, based on the record we are left to conclude that the Kosrae State Court committed clear error in the findings of fact supporting its decision to dismiss the cases. We turn to the orders of dismissal to determine whether they may otherwise be upheld under the facts shown by the record.

7. Dismissals for Failure to Prosecute

     "In recognition of the serious nature of the sanction of dismissal with prejudice . . . the law is clear that dismissal under Rule 41(b), like Rule 37, should be allowed `only in the face of a clear record of delay or contumacious conduct by the plaintiff,' or `upon a serious showing of willful default.'" McGillvray v. Bank of the FSM, 7 FSM Intrm. 19, 23 (Pon. 1995) (citations omitted).

     Rule 41(b) appears to contemplate a reasonable diligence standard. That is to say a plaintiff in a civil lawsuit seeking affirmative relief has the burden of pursuing that relief with reasonable diligence. Initially, the burden of showing some excuse for any delay in prosecution ought to be borne by the plaintiff. If the excuse is anything but frivolous, the burden shifts to the defendant to show prejudice from the delay. If prejudice is demonstrated, the burden shifts back to the plaintiff to show that the force of its excuse outweighs any prejudice to the defendant. In making this analysis, granting or denial of involuntary dismissal ultimately rests in the sound discretion of the court. Nevertheless, the record must still support a finding of delay attributable to plaintiff's conduct.

     Counsel for KICU did not receive formal notice of the May 18, 1999 trial date until on or about May 12, 1999 at which point he acted reasonably in attempting to travel to Kosrae. Given the effort KICU's counsel previously made to try these cases, it does not appear to us that counsel's inability to make the May 17, 1999 flight was either inexcusable or justifies the dismissal order entered. Certainly, the record does not suggest that KICU's counsel acted willfully or out of disdain for the trial court's authority. Considering the minimal three day continuance requested by KICU viewed in light of the absence of prejudice to the defendants, we find that the trial court abused its discretion in ordering the dismissal of the cases addressed by these appeals.

8. Conclusion

     Based on the foregoing we therefore reverse the trial court's May 18, 1999 orders of dismissal in Kosrae State Court Civil Action Nos. 6-96, 7-96, 9-96, 17-96, 18-96 and 21-96 with instructions to reinstate them on the court's trial calendar for further proceedings not inconsistent with this decision.

                                                             * * * *

____________________________________

Footnotes:

1. The orders of dismissal were first issued orally on the afternoon of May 18, 1999 at which time all six of the matters were called for trial during a single hearing.

2. The record confirms that formal notice of the May 18, 1999 trials in Civil Action Nos. 6-96, 7-96, 17-96 and 18-96 was not issued until May 10, 1999. In Civil Action Nos. 9-96 and 21-96 notice was not issued until May 11, 1999. It appears that the court faxed notice of trial to KICU's counsel on the day each was issued. The other counsel and the parties were personally served with notice during the week leading up to trial with some service occurring as late as May 17, 1999.

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