Cite as FSM Social Sec. Admin. v. Jonas,13 FSM Intrm. 171 (Kos. 2005)

[13 FSM Intrm. 171]

CIVIL ACTION NO. 2003-2005

Decided: March 3, 2005

APPEARANCES:

HEADNOTES

Attorney, Trial Counselor and Client – Fees

Even though the parties stipulated to the amount of attorney's fees and to the judgment the court must still make a determination of reasonableness for fees to be entered in a judgment. FSM Social Sec. Admin. v. Jonas, 13 FSM Intrm. 171, 170 (Kos. 2005).

Judgments

Although parties are free to stipulate to factual matters, they may not stipulate to conclusions of law to be reached by the court. FSM Social Sec. Admin. v. Jonas, 13 FSM Intrm. 171, 173 (Kos. 2005).

Costs

An award of costs depends upon a finding of reasonableness by the court. FSM Social Sec. Admin. v. Jonas, 13 FSM Intrm. 171, 173 (Kos. 2005).

[13 FSM Intrm. 172]

Costs

Fax and long distance telephone charges are not recoverable as costs. Copying costs may be recoverable if the copies are not made in-house, and the costs represent payment to others. FSM Social Sec. Admin. v. Jonas, 13 FSM Intrm. 171, 173 (Kos. 2005).

Judgments

Although parties are free to stipulate to factual matters, they may not stipulate to legal conclusions to be reached by the court. FSM Social Sec. Admin. v. Jonas, 13 FSM Intrm. 171, 173 (Kos. 2005).

Constitutional Law – Case or Dispute

When the parties have stipulated to a judgment and one claim remains, in order for the court to exercise its jurisdiction to dispose of this one remaining claim, a case or dispute under Article XI, Section 6 of the FSM Constitution must exist. The case or dispute must exist at the time the court acts. FSM Social Sec. Admin. v. Jonas, 13 FSM Intrm. 171, 173 (Kos. 2005).

Civil Procedure – Declaratory Relief

Further declaratory relief may not be appropriate when the plaintiff has already obtained by stipulation a judgment for the taxes, interest, and penalties sought in the complaint. FSM Social Sec. Admin. v. Jonas, 13 FSM Intrm. 171, 173 (Kos. 2005).

Civil Procedure – Summary Judgment; Constitutional Law – Due Process – Notice and Hearing

A sua sponte summary judgment motion is proper so long as the court provides adequate notice to the parties and adequate opportunity to respond to the court's motion. FSM Social Sec. Admin. v. Jonas, 13 FSM Intrm. 171, 173 (Kos. 2005).

Judgments

When a judgment on less than all claims in the pleadings is entered upon an express determination that there is no just reason for delay and upon an express direction for entry of judgment, that judgment is a final adjudication with regard to the claims disposed of by the judgment. A second judgment will issue later at the appropriate time that addresses the remaining claim. FSM Social Sec. Admin. v. Jonas, 13 FSM Intrm. 171, 173 (Kos. 2005).

COURT'S OPINION

MARTIN YINUG, Associate Justice:

On November 24, 2004, the parties filed their stipulation for entry of judgment. The proposed judgment has three components. The first is a sum certain for social security taxes, interest, and penalties in the amount of $7,023.42, plus post-judgment interest at the statutory rate of 12% per annum, 53 F.S.M.C. 605(4). The second is an award of attorney's fees and costs of $2,861.05, both of which are also permitted under 53 F.S.M.C. 605(4). The third component consists of conclusions of law regarding portions of Title 53 of the FSM Code.

With regard to the second component, the parties have stipulated to attorney's fees for 27.75 hours of time at $100 per hour. Even though this sum is stipulated, the court must still make a determination of reasonableness. Jackson v. George, 10 FSM Intrm. 523, 527 (Kos. S. Ct. Tr. 2002). The court finds the stipulated fee amount to be reasonable, except that the court will deduct one and a half hours to account for the drafting of the declaratory judgment portion of the stipulated judgment.

[13 FSM Intrm. 173]

As discussed further below, this deduction is made in light of the court's finding that as a matter of law the parties may not stipulate to conclusions of law. Thus that portion of the stipulated judgment is unnecessary. The court awards attorney's fees of $2,625.00, which represents 26.25 hours at $100 per hour.

Also with respect to the second component, the parties have stipulated to an amount for costs, which includes fax costs, copying costs, and costs for long distance charges. Again, an award of costs depends upon a finding of reasonableness by the court. Id. Fax and long distance telephone charges are not recoverable as costs. Damarlane v. United States, 7 FSM Intrm. 468, 470 (Pon. 1996). Copying costs may be recoverable if the copies are not made in-house, and the costs represent payment to others. Id. There is no showing that this was the case here. Thus the stipulated judgment is modified to exclude costs.

The final concern has to do with the fact that although parties are free to stipulate to factual matters, they may not stipulate to legal conclusions to be reached by the court. Saviano v. Commissioner, 765 F.2d 643, 645 (7th Cir. 1985). Thus the proposed judgment is amended to delete the declaratory judgment language, which means the claim for declaratory judgment alleged in the amended complaint remains pending. In order for the court to exercise its jurisdiction to dispose of this one remaining claim, a case or dispute under Article XI, Section 6(b) of the FSM Constitution must exist. Dorval Tankship Pty, Ltd. v. Department of Finance, 8 FSM Intrm. 111, 115 (Chk. 1997) (holding that the court has jurisdiction to hear a declaratory judgment action only where a case or dispute exists within the meaning of Article XI, Section 6(b) of the FSM Constitution). A case or dispute must exist at the time the court acts. Scherer v. Davis, 543 F. Supp. 4, 20 (N.D. Fla. 1981).

It appears to the court that further declaratory relief may not be appropriate here where the FSMSSA has already obtained by stipulation a judgment for the taxes, interest, and penalties sought in the complaint. Cf. Bank of Guam v. O'Sonis, 8 FSM Intrm. 301, 306 (Chk. 1998) (holding that declaratory relief was not appropriate where the plaintiff had already obtained a permanent injunction). Hence a summary disposition of the remaining claim may be fitting. "A sua sponte summary judgment motion is proper so long as the court provides adequate notice to the parties and adequate opportunity to respond to the court's motion." 11 JAMES WM. MOORE ET AL., MOORE'S FEDERAL PRACTICE §56.10[4][a] (3d. ed. 1999).

Accordingly, the FSMSSA may respond to the court's summary judgment motion on or before March 14, 2005. Defendants may file any reply on or before March 21, 2005.

With regard to the judgment for taxes, penalties, interest, and attorney's fees, judgment is entered pursuant to the stipulation but as modified by this order. That judgment is entered upon an express determination that there is no just reason for delay and upon an express direction for entry of judgment. FSM Civ. R. 54(b). Thus that judgment is a final adjudication with regard to the claims disposed of by the judgment. A second judgment will issue at the appropriate time that addresses the one remaining claim, which is the claim for declaratory relief alleged in the second cause of action of the amended complaint.