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KESKE S. MARAR, Associate Justice:
This appeal arises from a trial court ruling that Weno municipal business license fees imposed in 1993 were not unconstitutional taxes under the Chuuk Constitution. A single justice dismissed the appeal. We reinstate it, vacate the trial court judgment, and dismiss the case as moot. Our reasons follow.
I. Procedural History
On June 24, 1993, Tadashi Wainit d/b/a T & S Mart, filed his complaint, alleging that Weno Ordinance 01-01-93, section 3(A), which levied a business license fee or tax on Wainit's wholesale business, violated the state constitution because the state had not delegated the authority to tax wholesale businesses to the municipality. This contention was based on a Chuuk constitutional provision granting the state government the power to tax but allowing it to "delegate certain taxing powers to the municipal governments by statute," Chk. Const. art. VIII, § 7, and the absence of any such statute, either carried over from before the Chuuk Constitution's effective date or enacted afterward, delegating to the municipal governments the power to tax wholesale businesses. The complaint sought a declaratory judgment that the tax was unconstitutional and a permanent injunction against its enforcement.
Weno moved to dismiss, and, because matters outside the pleadings were contained in the motion, it was treated as a summary judgment motion. Wainit v. Weno, 7 FSM Intrm. 121, 122 (Chk. S. Ct. Tr. 1995). On April 21, 1995, the trial court granted Weno summary judgment, holding that the Weno Ordinance was not unconstitutional. Id. at 123. Judgment was entered on August 25, 1995.
[10 FSM Intrm. 605]
On September 25, 1995, Wainit timely filed his notice of appeal. Nothing else happened until January 31, 1996, when the Chief Justice signed an order assigning the appeal to himself as a single justice and not assigning any other members of the panel because, as the order stated, "the appellant has failed to prosecute this appeal in accordance with the applicable rules, leading the court to conclude that he has abandoned his appeal which requires the appeal be dismissed." On February 5, 1996, the single justice dismissed the appeal. The ground for dismissal was that Wainit had not, as required by Appellate Rule 10(b), ordered a transcript or filed and served a certification that no transcript would be ordered and, if a full transcript was not ordered, filed and served a statement of issues on appeal. On February 7, 1996, this dismissal order was faxed to Wainit's counsel, R. Barrie Michelsen, on Pohnpei.
On February 23, 1996, Michelsen filed and served a motion to vacate the dismissal order and to enlarge time to file the statements required by Rules 10(b)(1) and (3); his affidavit in support; a statement of issues on appeal; a statement that no transcript would be ordered; and a letter to the single justice explaining the situation and the steps he had taken to remedy the defects in the prosecution of the appeal. The affidavit (and the letter) stated that his associate Kathleen B. Alvarado had been assigned the initial preparation of the appeal and that it did not come to his attention that the statement of issues and the notice that no transcript would be needed had not been prepared and that he had thus made the appeal's preparation his highest priority prompting his filing that day. (Michelsen's letter also stated that Wainit had no responsibility for the failure to comply with Rule 10 and further stated that if a sanction was needed it should be imposed upon him personally and not his client.) On February 28, 1996, Wainit's opening brief was lodged with the clerk and served on opposing counsel.
The single justice heard the motions on April 3, 1996. By his written order, entered the next day, the motions were denied. The order noted that the February 5, 1996 order had dismissed the appeal for failure to comply with Appellate Rule 10(b). The order then stated the one reason for the motions' denial.
The Court recognized that the counsel for the appellant and the members of his law firm are experienced attorneys and they have practiced law long enough in Chuuk State Supreme Court; therefore, there is no proper reason why they did not comply with the Rules of this Court. For the reason stated herein, [the motions are denied.]
Order Denying Motion to Vacate Order Dismissing Appeal and Motion for Enlargement of Time at 1 (Apr. 4, 1996).
On May 6, and 9, 1996, Wainit, reasoning that the single justice's dismissal was a final disposition by the Chuuk State Supreme Court appellate division, filed a notice of appeal and a petition for certiorari in the FSM Supreme Court appellate division. The FSM Supreme Court agreed and granted the petition on March 10, 1997. Wainit v. Weno, 8 FSM Intrm. 28 (App. 1997). After some consideration, the FSM Supreme Court, on May 28, 1999, decided that it had erred in that the appeal was not from a final order since a Chuuk State Supreme Court single justice's orders could still be reviewed by a full Chuuk State Supreme Court appellate panel. Wainit v. Weno, 9 FSM Intrm. 160, 162-63 (App. 1999). It then remanded the case to the Chuuk State Supreme Court appellate division for action consistent with its opinion. Id. at 163. This proceeding followed.
II. Weno's Motion to Strike
Wainit filed an opening brief on December 29, 1999. Weno moves to strike this brief because an appellant cannot file two opening briefs and Wainit had already filed one in 1996. Weno also contends that documents in Wainit's appendix that are not part of the record and references in the
[10 FSM Intrm. 606]
1999 brief to those documents must be stricken from the record, and that, except for published opinions, we should not refer to them.
Wainit's 1996 brief was not filed with the court, but only lodged with the clerk. As such, Wainit has filed only one brief in this appeal, the 1999 one. 16A Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, Federal Practice and Procedure § 3956.1, at 322-25 (3d ed. 1999) (papers merely "lodged" with the clerk, but not filed, are not part of the record). The 1996 "lodged" brief is not part of the record, although its existence is. The motion to strike the 1999 brief is therefore denied. We have, however, except for published opinions, disregarded those documents that are not a part of the record and the brief's references to them. Weno's motion to strike is thus granted to that extent.
III. The Single Justice's Dismissal of the Appeal
The threshold issue before us is whether this appeal should be reinstated. To resolve this issue, we must analyze the events during this case's first sojourn in the Chuuk State Supreme Court appellate division. The dismissal was based on Appellate Rule 3(a).1 Rule 3(a) provides in pertinent part that: "Failure of an appellant to take any step other than the timely filing of a notice of appeal does not affect the validity of the appeal, but is ground only for such action as the State Court Appellate Division deems appropriate, which may include dismissal of the appeal."
A. The February 5, 1996 Dismissal
The appeal was initially dismissed by a single justice sua sponte, without prior notice to the appellant and without an opportunity for the appellant to be heard or to cure the defects in his prosecution of this appeal. When a court makes a motion sua sponte, it generally gives the parties notice and an opportunity to respond before it decides; just as when a party makes a motion the other party is generally given an opportunity to respond before the court rules. "Notice and an opportunity to be heard is the essence of due process." Kama v. Chuuk, 10 FSM Intrm. 593, 598 (Chk. S. Ct. App. 2002) (citing In re Sanction of Michelsen, 8 FSM Intrm. 108, 110 (App. 1997); Senda v. Creditors of Mid-Pacific Constr. Co., 7 FSM Intrm. 664, 669 (App. 1996)).
Wainit had no notice of the court's sua sponte motion to dismiss the appeal before the dismissal order was entered. The initial dismissal was thus a violation of Wainit's right to due process. Because of the lack of notice and an opportunity to be heard, the February 5, 1996 dismissal order violated Wainit's right to due process of law. It was thus void. It should have been vacated on that ground alone. In addition,
We note that a court "hears before it condemns," and that while a court that has announced a decision without notice and an opportunity to be heard can always be asked "to recall its decision and listen to argument . . . this opportunity, as every lawyer knows, is a poor substitute for the right to be heard before the decision is announced."
In re Sanction of Woodruff , 10 FSM Intrm. 79, 89 (App. 2001) (quoting Moore v. California Mineral
[10 FSM Intrm. 607]
Prods. Corp. , 252 P.2d 1005, 1007 (Cal. Dist. Ct. App. 1953)). This "poor substitute" was just the situation that Wainit's lawyer found himself in.
B. Denial of Motion to Vacate
The next question is whether the single justice abused his discretion when he denied the motions to vacate and to enlarge time to file the two Rule 10(b) statements. (Once vacated on due process grounds, the single justice could have renewed his sua sponte motion to dismiss. Because the February 5, 1996 dismissal was void, the single justice's reconsideration might more properly be viewed as a renewed motion to dismiss.)
Weno contends that the single justice did not abuse his discretion. For this proposition, Weno relies on Guam Sasaki Corp. v. Diana's Inc., 881 F.2d 713 (9th Cir. 1989) and Julien v. Zeringue, 864 F.2d 1572 (Fed. Cir. 1989). Weno also asserts that a transcript of the April 3, 1996 hearing would be needed before Wainit could show that the single justice abused his discretion.
No transcript is needed.2 No facts are in dispute. The chronology of events is clear. The single justice's sole reason for denying Wainit's motions was clearly stated in his April 4, 1996 order. Speculation about other possible reasons is pointless. Parties are entitled to rely on the single justice's written order. See, e.g., Knaust v. City of Kingston, 177 F.R.D. 109, 110 (N.D.N.Y. 1998) (transcript of summary judgment hearing unnecessary when court provided written decision rather than rendering decision from bench during oral argument). And there is no contention that Wainit is now raising an issue that was not raised before the single justice.
In Diana's, the Guam U.S. District Court appellate division's dismissal of two interlocutory appeals was upheld by the Ninth Circuit. The first appeal was dismissed for failure to obey court orders as well as violations of the procedural rules, Diana's, 881 F.2d at 716, and the second was dismissed after multiple rules violations had disrupted the appellate process, id. at 717-18. The dismissals' net effect was to put the parties again at the trial stage for a determination of the case's merits. Id. at 719. This case is not Diana's. This is not an interlocutory appeal. Wainit has not failed to obey any court orders. Wainit's single rules violation did not disrupt the appellate process, and dismissing the appeal will not have the effect of letting a trial on the merits go forward.
Weno also cites Julien v. Zeringue, 864 F.2d 1572 (Fed. Cir. 1989) as an appeal whose dismissal was upheld for failure to prosecute when counsel failed to perform his duty under the rules. Weno's Brief at 22. This argument mischaracterizes that case. In Julien, the dismissal order was reconsidered and vacated, and the appeal was reinstated and decided upon the merits.3 Id. at 1573. Julien's counsel failed to timely file the joint appendix after repeated extensions were granted, thus causing the appellees difficulty in preparing and filing their briefs. Id. at 1573-74. Although the Julien court held that its dismissal in the first instance was warranted, it considered counsel's candid admissions of fault and reinstated the appeal even though "Julien's counsel ha[d] repeatedly demonstrated a callous disregard for his responsibility to meet the time deadlines imposed by th[e] court's rules and orders." Id. at 1575. The Julien court, having given Julien's counsel notice and an
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opportunity to respond, sanctioned the counsel personally by requiring him to pay the appellees' excess attorney's fees and costs incurred because of his unprofessional management of the appeal's preparation. Id. at 1575-76. The Michelsen firm also candidly admitted its fault and recommended that sanctions, if needed, be imposed on it, and did not display the callous disregard for its responsibility that Julien's counsel had. The Michelsen law firm did not disregard any court orders and disregarded only one procedural rule time requirement.
Rule 3(a) does not require the dismissal for failure to comply with the procedural rules, but merely permits it in the proper case. "Not every appeal which fails to comply with the time requirements [in Rules 10, 11, and 12] must be dismissed." Walker v. Mathews, 546 F.2d 814, 818 n.3 (9th Cir. 1976). "The rules . . . are stated in permissive, rather than mandatory language. We are not required to dismiss every appeal which does not meet each of the time limitations in the . . . rules." King v. Laborers Int'l Union of N. Am., Local No. 818, 443 F.2d 273, 276 (6th Cir. 1971). But instead of trying some lesser appropriate action or sanction first, the single justice opted for the most extreme sanction of dismissal.
What factors should the single justice have used when reconsidering whether the appeal should be dismissed or some other sanction imposed? Generally,
Dismissal of an appeal for failure to comply with procedural rules is not favored, although Rule 3(a) does authorize it in the exercise of sound discretion. That discretion should be sparingly used unless the party who suffers it has had an opportunity to cure the default and failed to do so. Moreover, before dismissing an appeal . . . a court should consider and weigh such factors as whether the defaulting party's action is willful or merely inadvertent, whether a lesser sanction can bring about compliance and the degree of prejudice the opposing party has suffered because of the default.
Horner Equip. Int'l, Inc. v. Seascape Pool Ctr., Inc. , 884 F.2d 89, 93 (3d Cir. 1989). In Horner, on an appeal from the Virgin Islands Territorial Court to the U.S. District Court appellate division, the appellant ordered a transcript from the Territorial Court and the District Court dismissed the appeal for failing to pay for the transcript when requested, but no requests for payment appeared in the record. Id. at 92 & n.10. The appellate division did not consider any of the pertinent factors that it should have except for the appellant's counsel's alleged willfulness (which did not appear in the record) in not making arrangements to pay the stenographer. Id. at 93. The district court appellate division was therefore ordered to reinstate the appeal and reconsider using the appropriate standard.
Other cases are similar. Rodriguez v. Anderson, 973 F.2d 550, 551-52 (7th Cir. 1992) (case not dismissed although appellant filed only partial transcript, rest filed late, because court could conduct meaningful review); Island Creek Coal Co. v. Local Union No. 1827, 568 F.2d 7, 8 (6th Cir. 1977) (appellees' motion to dismiss because only partial transcript supplied and no statement of issues filed was denied when appellees were neither misled nor prejudiced by appellant's failure to serve statement of issues, when appellees could have sought supplementation of record and when there was no evidence appellant's omission was made in bad faith); Walker, 546 F.2d at 817-18 & n.3 (appellee never moved for dismissal, only made the contention in its answering brief; no dismissal for appellant's failure to observe time limits in Rules 10, 11, and 12 when appellee has not shown any prejudice from the delay); King, 443 F.2d at 276 (no dismissal for failure to timely file transcript); Phillips v. Employers Mut. Liab. Ins. Co. of Wis., 239 F.2d 79, 80 n.2 (5th Cir. 1956) (late filing of record and briefs was non-jurisdictional defect insufficient to warrant dismissal); Patrick v. John Odeto Water Serv., 767 F. Supp. 107, 109 (D.V.I. 1991) (although grounds for sanctions existed they did not rise to the extreme of dismissal under Rule 3(a) when the appellant's delays in paying the docket fee (one month), in filing the notice of transcript order (seven months), and in filing the statement of issues (nine months) were
[10 FSM Intrm. 609]
not willful, but were due to the appellant's financial difficulties, but which had to be remedied soon or the appeal would be dismissed); Knaust, 177 F.R.D. at 110 (not dismissed for failure to file transcript when transcript was unnecessary). In In re Webster, 47 B.R. 1012, 1013 (M.D.N.C. 1985), the court did dismiss an appeal for repeated noncompliance but stated, "If the appellants' only failure to comply with applicable rules was the untimely filing of the designated records on appeal and statement of issues, the Court would not dismiss the appeal." In such a case, the Webster court thought other sanctions would be appropriate. Id. at n.2.
There is no allegation that the Michelsen firm's omissions in this appeal were anything but inadvertent and no evidence that they were made in bad faith. The defect was cured promptly once the law firm had notice of it. Every indication is that a lesser sanction would have assured compliance with Rule 10(b). In fact, Wainit's counsel asked that, if a sanction were imposed, that it be imposed on the law firm, not the appellant. Weno could not have been misled or prejudiced because the statement of issues had not been timely filed. Weno did not suffer any prejudice because of the default. No appellate session had been held in the time between the appeal's filing and its dismissal. No briefing schedule had been issued. By the time of the April 3, 1996 hearing, an appellate session still had not been scheduled. None of the Horner factors that the single justice should have considered weigh in favor of dismissal. All weigh in favor of a lesser sanction or none at all. This is not an appeal which was dismissed only after the appellant had had an opportunity to cure the default and failed to do so.
The sole reason for the dismissal was that "the counsel for the appellant and the members of his law firm are experienced attorneys and they have practiced law long enough in Chuuk State Supreme Court." This is insufficient to dismiss an appeal when the appellant has promptly cured any defects in the appeal, when the default was not willful, when there was no prejudice to the appellee, and when the appellant's only failure was his untimely filing of the statement of issues and the certificate that a transcript would not be needed.
While practicing counsel are expected to know the rules and abide by them, "a preference exists for resolution of matters on the merits," and "[w]ithin the bounds of reason, and except where a specific rule, law, or conduct of a party or his counsel directs a different result, this preference should be given effect." O'Sonis v. Bank of Guam, 9 FSM Intrm. 356, 361-62 (App. 2000) (dismissal denied although appellant filed brief late). Since neither Rule 3(a) nor counsel's conduct in this appeal directs a dismissal, the preference for resolution of matters on the merits should be given effect.
This appeal is not one where the issues on appeal involve factual findings and no meaningful review is possible without a transcript and therefore the appellate court is left with no choice but dismissal when the appellant has not provided one. E.g., Stout v. Jefferson County Bd. of Educ., 498 F.2d 97, 98 (5th Cir. 1974); but see Birchler v. Gell, 88 F.3d 518, 520 (7th Cir. 1996) (although only partial transcript supplied, it was adequate for review, appeal not dismissed); Fisher v. Krajewski, 873 F.2d 1057, 1068-69 (7th Cir. 1969) (appellant and counsel sanctioned $1500 for failure to take any steps required by Appellate Rule 10(b) regarding transcripts, but appeal not dismissed; instead decided on the transcript provided by appellee with the transcript costs taxed to the appellant). Even then dismissal would likely come only after an appellee's motion or when the time had come for a court's decision on the merits.
The single justice thus abused his discretion when he denied the motions to vacate the dismissal and to enlarge time to file the Rule 10(b) statements. The single justice orders dismissing the appeal and denying Wainit's motions to vacate and to enlarge time to file the Rule 10(b) statements are accordingly vacated. The appeal is reinstated and the Rule 10(b) statements are considered properly filed. We now proceed to the appeal itself.
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IV. The Appeal
Weno contends that we can or should not decide anything other than whether to reinstate the appeal, and that if we reinstate the appeal, we should wait until the next appellate sitting to hear and decide the appeal's merits or any other issues. Wainit contends that we may proceed further on this appeal and that the initial issue is whether the issue appealed is now moot. Judicial economy requires that we proceed to whatever extent we can. Wainit has briefed the merits as well as the mootness issue. Weno has had the opportunity to respond. Both have had an opportunity to argue these points before us. We will consider the preliminary issue of mootness.
Before this case was filed in our trial division, two other cases, both raising the issue, among others, of the state constitutionality of the Weno Ordinance, were filed in the FSM Supreme Court trial division. Eventually that court, disagreeing with the trial division in this case, ruled on the same general issue and found the Weno Ordinance unconstitutional because there had been no state statute enacted delegating taxing powers to Weno Municipality. Stinnett v. Weno, 7 FSM Intrm. 560, 562-63 (Chk. 1996). Wainit, the plaintiff in this case, was a member of the Chuuk Chamber of Commerce and a plaintiff in one of the FSM Chuuk State Supreme Court cases and was granted a partial refund of the taxes he had paid to Weno. Chuuk Chamber of Commerce v. Weno, 8 FSM Intrm. 122, 128 (Chk. 1997). Weno then moved for Rule 60(b) relief from judgment based on "newly discovered evidence" from the Chuuk Constitutional Convention journal. That motion was denied. Stinnett v. Weno, 8 FSM Intrm. 142, 146-47 (Chk. 1997). All three decisions were affirmed on appeal in their entirety. Weno v. Stinnett, 9 FSM Intrm. 200, 215 (App. 1999). In 1998, while that appeal was pending, the Chuuk Legislature enacted a statute delegating taxing powers to the municipalities. Chk. S.L. No. 4-98-35.
Wainit thus contends that, once reinstated, the trial judgment should be vacated and the case dismissed as moot because the issue has been resolved by the highest court in the Federated States of Micronesia and the State of Chuuk and because of the 1998 statutory delegation of taxing powers to Weno. At oral argument, Weno acknowledged that once the Legislature delegated the taxing powers "it became a non-issue," but that the FSM Supreme Court cases might somehow apply to tax refunds to other municipalities.
No justiciable controversy is presented if events subsequent to the filing of an appeal make the issues presented in a case moot. Aguirre v. S.S. Sohio Intrepid, 801 F.2d 1185, 1189 (9th Cir. 1986) (citing Flast v. Cohen, 392 U.S. 83, 95, 88 S. Ct. 1942, 1950, 20 L. Ed. 2d 947, 959 (1968)). A claim becomes moot when the parties lack a legally cognizable interest in the outcome. If an appellate court finds that any relief it could grant would be ineffectual, it must treat the case as moot. FSM v. Louis, 9 FSM Intrm. 474, 482 (App. 2000); Berman v. FSM Supreme Court (II), 7 FSM Intrm. 11, 16 (App. 1995).
The enactment of a statute after judgment is entered and before the appeal is heard can make an appeal moot. See, e.g., Federal Shopping Way, Inc. v. O.K. Ins. Agency, Inc., 481 P.2d 5, 7 (Wash. 1971); Wilson v. State Highway Comm'n, 370 P.2d 486, 488 (Mont. 1962). Furthermore, an appellate court may receive proof or take notice of facts outside the record for determining whether a question presented to it is moot. Wilson, 370 P.2d at 488. We therefore may also take notice of the enactment of Chuuk State Law No. 4-98-35, delegating taxing powers to the municipalities. We thus conclude that the issue in the case ) the constitutionality of the wholesale business license tax imposed by Weno in 1993 ) is now moot. The Legislature, with its statutory delegation of taxing power, has made ineffectual any of the relief Wainit sought, a declaratory judgment and a permanent injunction. Weno's contention that other municipalities might be affected by the FSM Supreme Court cases is purely speculative and is irrelevant to this case and the parties before the court.
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Usually "when an appeal is dismissed as moot, the established rule is for the appellate court to reverse or vacate the judgment below and dismiss the case." Allard v. DeLorean, 884 F.2d 464, 467 (9th Cir. 1989) (citing United States v. Munsingwear, Inc., 340 U.S. 36, 39, 71 S. Ct. 104, 106-07, 95 L. Ed. 36, 41 (1950)). Since events subsequent to the filing of this appeal have caused the issues presented to become moot and we see no reason to depart from the usual rule, we hereby vacate the trial court judgment in Civil Action No. 122-93 and dismiss the case.
We therefore do not decide the appeal's merits, but we note that if we had, it is unlikely we would have reached a decision different from that of the FSM Supreme Court. Their reasoning was persuasive and the constitutional language appears clear) that municipalities could levy taxes only once the Chuuk Legislature has delegated that power to them. But even if we had reached a result different from the FSM Supreme Court, an aggrieved Wainit could then still appeal our decision to the FSM Supreme Court appellate division. We have no reason to believe that that court would decide the merits any differently from their previous decision in Weno v. Stinnett, 9 FSM Intrm. 200 (App. 1999).
Accordingly, the appeal is reinstated and the trial court judgment is vacated and the case is dismissed as moot.
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1.Chuuk Appellate Rule 3(a) is similar to U.S. Federal Rule of Appellate Procedure Rule 3(a). (Rules 10(b) are also similar.) When the rules are similar and the Chuuk State Supreme Court has not previously construed its rules, it may look to other FSM sources and then to U.S. sources for guidance. See, e.g., Apweteko v. Paneria, 6 FSM Intrm. 554, 557, 1 CSR 30, 32 (Chk. S. Ct. App. 1994) (using U.S. cases to interpret Civil Rule 15(b)); Election Comm'r v. Petewon, 6 FSM Intrm. 491, 499, 1 CSR 5, 11 (Chk. S. Ct. App. 1994) (using U.S. case to interpret Civil Rule 60(b)).
2. Generally, if an appellee deems a transcript is needed when the appellant has declined to order one, the appellee may designate what transcript is needed and if the appellant does not order it, then the appellee may order it or seek an order requiring it. Chk. App. R. 10(b)(3). Weno has not done so. But the appellate rules about transcripts apply only to trial court proceedings.
3. See Julien v. Zeringue, 864 F.2d 1569 (Fed. Cir. 1989) (decision on the merits).