FSM 4 Intrm. 186-198

Where there are no directly controlling statutes, cases or other authorities within the Federated States of Micronesia, it may be helpful to look to the law of other jurisdictions, especially the United States, in formulating general principles for use in resolving legal issues bearing upon the rights of public employees and officers, in part because the structures of public employment within the Federated States of Micronesia are based upon the comparable governmental models existing in the United States. Sohl v. FSM, 4 FSM Intrm. 186, 191 (Pon. 1990).

A basic premise of public employment law is that the rights of a holder of public office are determined primarily by reference to constitutional, statutory and regulatory provisions, not by the principles of contract which govern private employment relationships. Sohl v. FSM, 4 FSM Intrm. 186, 191 (Pon. 1990).

The amount of compensation a public employee receives is not based on quasi-contract doctrines such as quantum meruit or unjust enrichment, but instead is set by law, even if the actual value of the services rendered by a public officer is greater than the compensation set by law. Sohl v. FSM, 4 FSM Intrm. 186, 192 (Pon. 1990).

Public employees are only entitled to receive the benefits prescribed by law for positions to which they have been duly appointed, even if an officer or employee has performed duties or services above and beyond those of the appointed office. Sohl v. FSM, 4 FSM Intrm. 186, 192 (Pon. 1990).

A public officer claiming certain compensation or other benefits must show a clear legal basis for his right to these emoluments; hopes and expectations, even reasonable ones, are not enough to create that legal entitlement, nor are any moral obligations which may be incurred, without clear warrant of law. Sohl v. FSM, 4 FSM Intrm. 186, 193 (Pon. 1990).

The compensation of public officials in the FSM is not determined by a contract for specific services, express or implied, but by the judgment of the people, through their elected representatives and executive officials who properly exercise delegated power pursuant to statutory or other authorization; specifically, the FSM Constitution and statutes establish how a person may attain public office, and the National Public Service System Act and regulations thereunder set the compensation to be paid to holders of the respective offices. Sohl v. FSM, 4 FSM Intrm. 186, 194 (Pon. 1990).

Where a public official claims additional compensation, it is inappropriate to ask whether he received compensation equal to the value of his services to the public, but instead the Court must inquire whether he received the amount that was due to him by law or whether he can demonstrate a clear legal entitlement to the office which would have provided the compensation he now seeks. Sohl v. FSM, 4 FSM Intrm. 186, 194 (Pon. 1990).

Both parties have filed motions for summary judgment in this action brought by plaintiff John Sohl seeking additional compensation for services rendered by him as a public official and employee of the defendant, the Federated States of Micronesia.

While general principles of equity, and contract and quasi-contract law normally applicable to private employment disputes may well favor Mr. Sohl's position, those are not governing considerations in a claim of a public official of the Federated States of Micronesia seeking additional compensation

Compensation of public officials is fixed by Constitution, statute and regulation, rather than by principles of contract or equity. Although Mr. Sohl was assigned additional duties during the time in question, the appropriate steps to change his job title and rate of compensation were not taken. Thus, there is no authorization for the higher compensation he believes he has earned.

John Sohl began working with the FSM National Government in 1980, as the Chief Federal Program Coordinator of the Office of Planning and Statistics (OPS). In this position, he received compensation as a pay level 37 employee, the pay level established for the position of Chief Federal Program Coordinator within the FSM Public Service System, as regulated by the National Public Service System Act.

On September 9, 1983 Mr. Sohl became the Acting Director of OPS, per appointment of President Tosiwo Nakayama.1 The FSM Code prohibits individuals from serving in an "acting" capacity for more than 60 days pursuant to one designation, 2 F.S.M.C. 208, and Mr. Sohl was never reappointed as Acting Director of OPS between his initial appointment and his eventual nomination as Director of OPS on January 23, 1987. Yet, it is undisputed that throughout the period from September 9, 1983 to January 23, 1987, Mr. Sohl continued to perform the duties of Director of OPS, but at all times received less compensation than is payable to the holder of that position under the Public Service System Regulations. 52 F.S.M.C. 117.

On September 9, 1983, when Mr. Sohl was named Acting Director of OPS, no action was taken to adjust his salary. From that time on, until January, 1985, no action was taken concerning Mr. Sohl's job title or rate of pay. In January, 1985, Vice President Bailey Olter became involved, taking several actions. A personnel memorandum dated January 24, 1985, was issued by the personnel officer. This caused Mr. Sohl to receive a retroactive within-grade step increase, from $622.40 biweekly to $660.00, for his work from November 29, 1984 to January 19, 1985. The personnel memorandum apparently was based upon a performance report, dated January 28, 1985 issued by Vice President Olter, rating Mr. Sohl's performance as Chief Federal Program Coordinator from November 30, 1982 to November 29, 1984.

Mr. John Sohl has been running the Office of Planning and Statistics for almost two years without proper documentation and compensation. His performance during such period has proven him to be capable of carrying out the mandates of that office. Therefore, I have decided to appoint Mr. Sohl as the Interim Administrator of the Office of Planning and Statistics. He will serve in the capacity until the position is filled by an appointee of the President and consented by Congress.

To implement this decision, the Vice President executed a personnel action form for termination of Mr. Sohl's status as Chief Federal Program Coordinator, effective January 1985. Another personnel action form was issued at the same time to install Mr. Sohl as Administrator of OPS. Both actions were approved by the budget officer on January 30, 1985 and by the personnel officer on February 1, 1985.

Mr. Sohl retained the title of Interim Administrator until January 23, 1987, when the Congress confirmed President Nakayama's nomination of him to serve as Director of OPS. From that time until August 8, 1987, when President Haglelgam named him Transition Advisor, plaintiff Sohl was the Director of OPS, receiving $884.62 biweekly, an annual salary of $23,000.

Mr. Sohl contends that during the entire time after his original September 9, 1983 appointment as Acting Director of OPS, he should have received the salary which the Director of OPS is legally entitled to receive. He argues that from September 9, 1983 to January 23, 1987 the government was being unjustly enriched by receiving his services, which were in all respects those of the Director, while paying him less than the Director is to be paid by law. He asks the Court to award him restitution damages to the extent of the difference between his actual salary and the proper salary of the Director of OPS, for the period from September 9, 1983 to January 23, 1987.

In support of his position, plaintiff directs the court to an array of American cases and other authorities relating to issues arising out of private employment or other dealings between private parties. Some authorities cited by plaintiff hold that, for purposes of justice or to reflect the actual intentions or assumptions of the parties, a contract may be implied in law or in fact even where no actual contract exists. Other cases illustrate the well-established principle that where goods or services are provided by one

There are no directly controlling statutes, cases or other authorities within the Federated States of Micronesia. The Court therefore agrees with the plaintiff's apparent belief that it may be helpful to look to the law of other jurisdictions, especially the United States, in formulating general principles for use within the Federated States of Micronesia in resolving legal issues bearing upon the rights of public employees and officers.

This is so in part because the structures of public employment within the Federated States of Micronesia are based upon the comparable governmental models existing in the United States. See Lonno v. Trust Territory, 1 FSM Intrm. 53, 69 n.12 (Kos. 1981); Suldan v. FSM, 1 FSM Intrm. 339, 345 (Pon. 1983). It is also true because the common law of the United States has been recognized as an appropriate source of guidance for courts within the Federated States of Micronesia. Semens v. Continental Airlines, Inc., 2 FSM Intrm. 131, 141-42 (Pon. 1985).

However, the precedents in the United States are not helpful to Mr. Sohl. All of the cases cited on his behalf relate to disputes arising out of private employment arrangements. Since Mr. Sohl's claim is based upon services he performed as an official of the Federated States of Micronesia national government, the American cases involving public employment are of more direct application to Mr. Sohl's case. As the cases cited in this opinion demonstrate, United States courts make a sharp distinction between public and private employment and apply fundamentally different principles to each. The courts have specifically declined to apply to public employment disputes the principles of contract and unjust enrichment relied upon by Mr. Sohl.

1. Contract - A basic premise of public employment law is that the rights of a holder of public office are determined primarily by reference to constitutional, statutory and regulatory provisions, not by the principles of contract which govern private employment relationships. Crenshaw v. United States, 134 U.S. 99, 106, 10 S. Ct. 431, 433, 33 L. Ed. 825 (1890); Taylor v. Beckham, 178 U.S. 548, 576, 20 S. Ct. 890, 900-01, 44 L. Ed. 1187 (1900); Mullett v. United States, 150 U.S. 566, 570, 14 S. Ct. 180, 182, 37 L. Ed. 1184 (1893).

Subject to constitutional limitations, the public has the power, through its laws, to fix the rights, duties and emoluments of public service, and the public officer neither bargains for, nor has contractual entitlements to them. Crenshaw, 134 U.S. at 104-05, 10 S. Ct. at 433; Taylor, 178 U.S. at 577, 20 S. Ct. at 901: ("In short, generally speaking, the nature of the relations of a public officer to the public is inconsistent with either a property or a contract right."); Shaw v. United States, 640 F.2d 1254, 1260 (Ct. Cl. 1981); Zucker v. United States, 578 F. Supp. 1239, 1242 (S.D.N.Y. 1984) ("there can be no contractual liability running from the government to

2. Unjust Enrichment - Similarly, the amount of compensation a public employee receives is not based on the quasi-contract doctrines which plaintiff invokes, such as quantum or unjust enrichment. The United States Supreme Court has remarked that "Every offic meruit2 er or regular employee of the government should be limited in his compensation to such salary or fees as were by law specifically attached to his office or employment." Mullett v. United States, 150 U.S. 566, 570, 14 S. Ct. 190, 192, 37 L. Ed. 1184 (1893). Public employment compensation is set by law. "If the fixed compensation is more than the service is worth, the public or party must pay for it; if less, the officer must be content with it." 63A Am. Jur. 2d Public Officers and Employees § 434 at 1002 (1984).

The fact that the actual value of the services rendered by a public officer is greater than the compensation set by law may not serve as a basis for a quantum meruit claim. "The right of a public officer to compensation for the performance of duties imposed upon him by law does not rest upon contract, but is incident to the right to hold office; and, unless compensation is allowed by law, he may not lawfully demand payment as upon a quantum meruit for services rendered." McGillic v. Corby, 95 P. 1063, 1065 (Mont. 1908). Actions for restitution for services rendered run against the very nature of public service and popular will. They are incompatible with the idea of public office or employment. See, e.g., Mullett, 150 U.S. at 566; MacMath v. United States, 248 U.S. 151, 153, 39 S. Ct. 31, 32, 63 L. Ed. 177 (1918); Ganse, 376 F.2d at 902.

3. Legal entitlement necessary - Thus, it is fundamental and well settled that public employees are only entitled to receive the benefits prescribed by law for positions to which they have been duly appointed. O'Reilly de Camara v. Brooke, 209 U.S. 45, 53, 28 S. Ct. 439, 441, 52 L. Ed. 676 (1908); United States v. King, 147 U.S. 696, 13 S. Ct. 439, 37 L. Ed. 328 (1898); Donovan v. United States, 580 F.2d 1203, 1208 (Ct. Cl. 1978). This is true even if an officer or employee has performed duties or services above and beyond those of the appointed office. Ganse, 376 F.2d at 902. Most recently, the United States Supreme Court held that "the federal employee is entitled to receive only the salary of the position to which he was appointed, even though he may have performed the duties of another position or claims that he should have been placed in a higher grade." United States v. Testan, 424 U.S. 392,

In all cases, the officer claiming certain compensation or other benefits must show a clear legal basis for his right to these emoluments. "In order to recover on the basis of salary of a higher position than that to which a claimant has actually been appointed, the claimant must normally show a legal entitlement to the pay of the higher position." Power v. United States, 597 F.2d 258, 262 (Ct. Cl. 1979). See also Realty Associates Securities Corp. v. O'Connor, 295 U.S. 295, 299, 55 S. Ct. 663, 665, 79 L. Ed. 1446 (1935). Hopes and expectations, even reasonable ones, are not enough to create that legal entitlement, nor are any moral obligations which may be incurred; clear warrant of law is an absolute necessity.

For instance, in a case quite similar to the one before this Court, an attorney employed by the United States government served in an acting capacity in a position above his actual permanent appointment. Like Mr. Sohl, he performed all the duties of that higher office and served in the acting position at the request of his superiors for a long period of time. Nonetheless, the court dismissed his claim for increased compensation, because the attorney lacked a clear legal entitlement to the higher salary, regardless of the duties he actually performed. Peters v. United States, 534 F.2d 232 (Ct. Cl. 1976). Plainly, application of the principles of public employment law developed by courts in the United States would not produce the results sought by the plaintiff.

The principles of common law as applied by courts of the United States, of course, are not in themselves binding on this Court. Rauzi v. FSM, 2 FSM Intrm. 8, 14 (Pon. 1985). Where appropriate, this Court will depart from traditional common law principles, so that its decisions "shall be consistent with [the] Constitution, Micronesian customs and traditions, and the social and geographic configuration of Micronesia." FSM Const. art. XI, § 11. See also Semens v. Continental Air Lines, Inc., 2 FSM Intrm. 131, 142 (Pon. 1985).

Here, however, we see no cause to ignore the understandings of public employment and compensation outlined above. On the contrary, the rules governing the conditions and requirements of public employment are likely to be even more important in this country than in the United States, because "[g]overnment employment constitutes a much higher proportion of economic activity within the Federated States of Micronesia." Falcam v. FSM Postal Service, 3 FSM Intrm. 112, 118 (Pon. 1987). It is all the more essential here to ensure that both the government on the one hand, and public officers and employees on the other, abide by the strict rule of law in all respects. Public confidence in the integrity of our system of public employment would otherwise erode.

inherent in the idea of government for and by the people. Popular sovereignty requires that public officers only serve subject to the judgment of the people as to the employee's duties, rights and benefits. Under the FSM Constitution, the National Public Service System Act and the Public Service System regulations, public officials and employees serve at the will of the people as expressed through the laws and democratic institutions, and they must serve the common good, not their private interests. Thus, in Micronesia, no less than elsewhere, public officials are recipients of popular trust. Their compensation is determined not by a contract for specific services, express or implied, but by the judgment of the people, expressed through their elected representatives and executive officials who properly exercise delegated power pursuant to statutory or other authorization.

Specifically, the Constitution and statutes establish how a person may attain public office. The National Public Service System Act and regulations thereunder set the compensation to be paid to holders of the respective offices. For this Court to entertain a theory that public officers within the Federated States of Micronesia should be legally entitled to a salary determined on the basis of quantum meruit, rather than statutes and regulations, would be tantamount to turning the entire system of public employment on its head. It would strip from Congress the power to regulate public employment and would require this Court to assess every employment relationship with the government and measure the value of the services rendered by that employee. Such a venture would be undemocratic as well as impractical.

In the case at hand, then, it is inappropriate to ask whether Mr. Sohl received compensation equal to the value of his services to the public. Instead, we must inquire whether he received the amount that was due to him by law or, put another way, whether he can demonstrate a clear legal entitlement to the office which would have provided the compensation he now claims. From this starting point, the Court finds no basis for the plaintiff's claim.

First, there is no suggestion that the plaintiff actually was the Director of OPS prior to January 23, 1987, when Congress confirmed his nomination to that position. Plaintiff does not claim now, nor did he claim at any point in his employment by the government, that he legally was the Director of OPS before that date. His claim for the salary of the Director cannot be supported on that ground.

Plaintiff was the Acting Director for some period of time between September 9, 1983 and January 23, 1987, but exactly how long he was the Acting Director is a point of contention between the parties. His initial appointment was only legally valid for a maximum of 60 days under the FSM Code, which reads in pertinent part:

Whenever a vacancy exists in a position exempted from the National Public Service System... the administrative duties and ministerial functions of that position may be performed by a qualified regular employee designated by the President to

serve in that position in an "acting" capacity, pending an appointment to fill the vacancy. A qualified regular employee so designated by the President to serve in an "acting" capacity may serve in that capacity for not more than sixty days.

2 F.S.M.C. 208. Plaintiff was never reappointed to the position of Acting Director. His performance rating report and his within-grade salary increase clearly show that until January 20, 1985 the government considered him to be the Chief Federal Program Coordinator, not the Acting Director of OPS, regardless of the duties he was actually performing at the time.

For these reasons, this Court is inclined to say that the plaintiff, as a matter of law, was not the Acting Director of OPS beyond the 60-day period of his initial appointment. There are some grounds, perhaps, for arguing the plaintiff was the de facto Acting Director beyond his initial appointment, at least until he was designated as Administrator of OPS in January 1985. However, whether the Court finds that plaintiff was the Acting Director throughout the period in dispute, or only for a part of it, does not affect his claim for additional compensation; we do not need to reach any final decision in that regard.

Even if the plaintiff had been the Acting Director for the 16-month period between September 9, 1983 and January 20, 1985, his claim rests on the underlying assumption that an Acting Director should be legally entitled to the same compensation as a Director. The Court has already noted above that compensation of public officers does not rest upon the actual services performed, but rather attaches to certain offices. The fact that plaintiff performed the same duties as the Director would have performed, therefore, does not give him any right to the same compensation as a Director.

Instead, the compensation of an Acting Director must be based in the judgment of the legislature or other body to which the matter is entrusted, and must find a clear basis in the law. Congress has been silent on the fixing of salaries for acting officers performing the duties of offices exempt from the Public Service System. The Public Services System Regulations which address acting assignments and temporary promotions do not apply to exempt positions.52 F.S.M.C. 117. Thus, Congress has generally left the designation of salaries for officers temporarily acting in exempt positions to the discretion of the head of the applicable branch of government: in this case, the President.

Plaintiff has not offered any evidence and does not contend that any person within the government, least of all someone with the President's authority to set plaintiff's salary, promised him additional compensation for his duties as Acting Director. Plaintiff's failure to contest his rate of compensation in any way throughout his period of public employment also strongly suggests that there was no actual arrangement for him to receive additional compensation. His own subjective hope and expectation of higher pay is simply not enough to ground a claim of this kind. This Court will not

usurp the roles of other branches of government by presuming to know what value the President, as the legally authorized public representative, assigns to the positions of acting officers and directors. It is clear, in any case, that the Vice President, for one, did not consider Mr. Sohl's performance of the duties of Director sufficient grounds for his receiving the salary of Director. The Vice President's designation of Mr. Sohl as Administrator of OPS explicitly acknowledged his performance of the Director's duties, yet set his new salary at a level lower than that of the Director.

The rate of pay which plaintiff seeks for his work is not prescribed for the job titles to which he was assigned. There is no contention that the pay he received until January 29, 1985 was inappropriate for the Federal Project Coordinator. The pay rate for his work as Interim Administrator was specifically fixed by the memo of January 29, 1985, and nobody before the Court questions the power of the Vice President to fix the pay rate for that position. Presumably, when Mr. Sohl was appointed Acting Director of OPS, President Nakayama could have declared a higher pay rate for him but this was not done.

The analysis in Falcam v. FSM, 3 FSM Intrm. 194 (Pon. 1987) is consistent with what is being said here. In Falcam, the plaintiff had been appointed to the position of Pohnpei postmaster in compliance with the statutory and regulatory requirements. The appointing official had violated his own responsibilities in making the appointment, but the statute in question did not render the appointment itself invalid. In those circumstances, the court found the necessary legal entitlement to compensation at the rate set for that position for the time the employee had worked in good faith pursuant to the appointment. 3 FSM Intrm. at 203.

In contrast, plaintiff Sohl is unable to establish the requisite legal entitlement to the office. He was not appointed Director of OPS until January, 1987. To grant the relief which Mr. Sohl seeks, the court would first have to imply or fabricate an earlier Presidential appointment; then it would be necessary to disregard the fact that any such implied or imagined appointment would have been violative of the constitutional and statutory requirements of congressional advice and consent.

The constitutional principle of checks and balance also militates against Mr. Sohl's claim. The power of the President to appoint executive branch officers is not absolute, but is subject to check by Congress. Thus, the power of the President to appoint "principal officers of executive

departments in the national government; and such other officers as may be provided for by statute," is subject to "the advice and consent of Congress." FSM Const. art. X, § 2(d). Pursuant to this constitutional provision, the statute providing for the executive organization of the national government specifies that presidential nomination of the Director of OPS is subject to congressional advice and consent. 2 F.S.M.C. 206.

In the case of Mr. Sohl, the parties agree that he was assigned the duties of the Director of OPS and was carrying out those duties for several years. This was being done without a formal presidential appointment and, more to the point, without any nomination being placed before the Congress for advice and consent. If now, this Court were to hold that Mr. Sohl is entitled to retroactive payment of the salary of the Director of OPS, the result would be that he would have received both the powers and the compensation of the Director of OPS for an extended period of time without Congress having any opportunity to serve as a check upon this executive appointment. There is no suggestion here that executive branch actions concerning Mr. Sohl were intended to evade congressional advice and consent powers. Yet, a ruling in favor of Mr. Sohl would establish a method by which the executive branch could effectively fill high level positions while depriving the Congress of any opportunity to exercise its constitutional powers of advice and consent. This Court may not condone any action which renders ineffective a constitutional power granted to one of the branches of government.

Recognition that the constitutional requirement of interplay between the executive and legislative branches is one factor standing in the way of relief for Mr. Sohl points the way toward a possible avenue of redress. Here, although Mr. Sohl performed the duties of Director of OPS at the request of the President, he is not entitled to the compensation provided for that office until his appointment was confirmed by Congress.

As demonstrated in this opinion, the law does not permit this Court to grant his claim. This is so despite the possibility that this result is in a more general sense unfair to Mr. Sohl. Since the parties agree that Mr. Sohl was in fact performing the duties of the Director of OPS, there is considerable force to his argument that it is unfair for the government to refuse to pay him for performing those duties.

In similar circumstances, legislative bodies have intervened to provide relief for public officials who would otherwise suffer loss. For example, the following tale is related in L. Fisher, Constitutional Conflicts Between Congress and the President 50 (1985):

George Rublee, nominated to the Federal Trade Commission in March 1915, served for more than a year as a recess appointee. After the Senate voted to reject him he continued to serve (at President Wilson's request) the balance of his recess

In light of the fact that President Nakayama eventually did nominate Mr. Sohl as Director of OPS and Congress did confirm the appointment, it seems possible that Congress could conclude that the granting of Mr. Sohl's claim by special appropriation would be just and would not serve as a precedent harmful to congressional powers.

In sum, then, this Court cannot find any legal basis to support plaintiff's claim that he was entitled to higher compensation during any or all of his tenure as Acting Director of OPS. No constitutional provision, statute, or regulation provides for such an increase, and no executive officer with legal discretion to set salaries for exempt positions made any representations that plaintiff would receive additional pay. Unless Congress chooses to provide a special appropriation for him, no relief can be provided.

1. During the course of the events outlined in this opinion, the original title, National Planner, was changed to Director of OPS. The latter designation will be used throughout this opinion and Acting Director will be used to mean Acting National Planner.