FSM 6 Intrm. 508-529

A plaintiff who has previously litigated and lost his claim to a legal interest in a certain property is collaterally estopped from claiming damages as a result of loss of ownership or possession of the land because under the principle of collateral estoppel, a cause of action which could have been litigated in the course of the original case between the same parties is treated as litigated and decided with the former cause of action. Nahnken of Nett v. United States (III), 6 FSM Intrm. 508, 516 (Pon. 1994).

In some cases failure to join an indispensable party may subject a judgment to collateral attack, but failure to join a necessary party will not. A necessary party is one who has an identifiable interest in the action and should normally be made a party to the lawsuit, but whose interests are separable from the rest of the parties or whose presence cannot be obtained; whereas an indispensable party is one to whom any judgment, if effective, would necessarily affect his interest, or would, if his interest is eliminated, constitute unreasonable, inequitable, or impractical relief. Nahnken of Nett v. United States (III), 6 FSM Intrm. 508, 517 (Pon. 1994).

Since by statute the Trust Territory government would be liable to private litigants only under circumstances where a private person would be liable to the claimant for similar acts and because declaring title to the property could only be accomplished by an administering governmental authority there is no tort for loss of property for declaring title because private persons have no authority to declare title. Nahnken of Nett v. United States (III), 6 FSM Intrm. 508, 527 (Pon. 1994).

The defendant Pohnpei Public Lands Authority ("PLA"), which includes the Public Lands Board of Trustees, is a division of the Pohnpei State Department of Land, established under the Pohnpei Public Land Trust Act, S.L. 1L-155-87 (Pohnpei State Legis., 4th Reg. Sess. 1987).2 PLA is sued for allegedly breaching its duty to hold and administer the property in this action as public lands in trust for the indigenous people of Pohnpei, and specifically, in failing to return the land at issue to the plaintiff as customary and traditional owner of the land.

The lengthy and complex history of the transactions concerning the land involved in this action has been described in several other decided and pending cases. See, e.g., In re Etscheit Property, Civil Action No. 142-78 (Trust Territory High Court, 1980); Etscheit v. Adams, 6 FSM Intrm. 365 (Pon. 1994) (the partition case). Briefly, the property known as Mpomp was leased to one Stanislaus Kubary in 1895. In 1903, after Kubary's death, the land was auctioned by the German administering government and purchased by Domenikus Etscheit, ancestor of the present Etscheit defendants. The property was confiscated by the Japanese following World War I, and returned to the Etscheits in 1927. The Japanese government regained the land through forced sale in 1940-41. After the Second World War ended, the Etscheit family retook possession of the land. In 1956 the Trust Territory government entered into a Memorandum of Understanding ("MOU") with Florentine Etscheit recognizing the Etscheit family as rightful owner of Mpomp, Sapwetik and Taketik, and quitclaim deeds were issued accordingly in 1957 in exchange for a payment of money by Florentine Etscheit and transfer of certain other property.

In 1978 the Etscheits filed a trespass action in the Trust Territory High Court ("TT High Court") against the Nanmwarki and Nahnken of Nett regarding Mpomp, which became by consent of the parties a quiet title action.3 The trial division of the TT High Court ruled in favor of the Etscheits as owners of Mpomp. The defendants, including the present plaintiff Iso Nahnken, appealed. The appellate division of the TT High Court affirmed the decision of the trial court. Nanmwarki, Naniken of Nett v. Etscheit Family, 8 TTR 287 (App. 1982). Pursuant to the decision of the TT High Court appellate division, the Pohnpei Land Commission issued certificates of title to Mpomp to the Etscheits in 1983.

Sapwetik and Taketik were not part of the TT High Court litigation. Both were named in the 1903 notice of sale to Domenikus Etscheit, and both were part of the 1957 conveyance from the Trust Territory to his widow, Florentine Etscheit. A Determination of Ownership regarding Sapwetik was made in favor of the Etscheits by the Pohnpei Land Commission in 1984; however, a certificate of title has not been issued apparently because of state court litigation between members of the Etscheit family as to the proper title holder.

Plaintiff asserts that as the Iso Nahnken he is the rightful owner and administrator of the land at issue in this case. The theory behind his claims is summarized as follows. Pohnpeian custom and an 1895 ruling by a Spanish official held that the "Chief of Nett" was the owner of the lands known as Mpomp. According to the Spanish-era documents submitted by plaintiff, the Chief of Nett (the Nanmwarki at the time) entered into a lease of the property to Stanislaus Kubary. The lease was for life to Kubary, and then to his wife and descendants upon his death. The subsequent 1903 estate sale by German officials to Domenikus Etscheit violated the terms of the 1895 agreement between the Nanmwarki and Kubary, and therefore the sale was void.

Even assuming the sale was valid and interest in the land passed to the Etscheit family, during World War II the Japanese bought the property from the Etscheits. Plaintiff contends that this meant after the war title to the land became vested in a Trust Territory official known as the "Alien Property Custodian," a predecessor of the current PLA. Therefore, the lands formerly possessed by the Etscheits became public land by virtue of the Japanese purchase, because under Trust Territory laws and policy the Trust Territory government succeeded to title of all such land to administer in trust on behalf of the indigenous inhabitants. The chain of title thus went from the Japanese to the Alien Property Custodian to the present PLA. The effect of this chain of title is that the formal deed of the land from the TTPI government to Florentine Etscheit in 1957 was void, because the Alien Property Custodian and the TTPI government were prohibited by existing laws and regulations from issuing deeds to such property to non-indigenous persons. Thus, the land was never legally transferred to the Etscheits and is still held by the PLA. The PLA had a legal duty under Trust Territory laws and Secretarial Order 2969 to hold public land in trust for the indigenous people of Pohnpei, and breached that duty by failing to return the Etscheit lands to the plaintiff as traditional administrator of Nett lands. The acts of all three groups of defendants caused plaintiff to suffer loss and damages in the amount of fifty million dollars.

Defendants PLA and the Etscheits have moved for summary judgment and plaintiff has cross-moved for summary judgment. As a preliminary matter, the Court must determine pursuant to FSM Civil Rule 56 whether there are any genuine issues of material fact. At the hearing on June 30th plaintiff suggested that there is an issue of fact whether plaintiff had notice of the certificate of title to Mpomp issued by the Land Commission to the Etscheits. For the reasons which are discussed below, the Court does not find that a genuine issue exists with regard to this question. The other question raised by plaintiff at the hearing was whether the Land Commission followed customs and traditions, and existing district law, when it issued the certificates of title. This is a legal question, not a factual one.

The only potentially material fact over which the parties fundamentally disagree and have posited opposing authorities is the question whether the Iso Nahnken of Nett traditionally had authority to own and administer lands in Nett for the benefit of the people. Defendants refute such authority, citing sources which mention only the Nanmwarki in discussing customary distribution of land in Pohnpei. Plaintiff has submitted an affidavit from the former Nanmwarki of Nett, the late

Frederick Iriarte, stating that the Iso Nahnken holds joint authority with the Nanmwarki over land distribution. The Court need not resolve this issue. Even assuming that plaintiff's position is correct, and that as a general matter he has standing to bring suit for damages for loss of land traditionally under his control, the Court does not find this fact material to the summary judgment arguments before it concerning the property and other facts of this case. Therefore, this case is ripe for summary judgment as a matter of law under FSM Civil Rule 56. Bank of Guam v. Island Hardware, 2 FSM Intrm. 281, 284 (Pon. 1986); FSM Dev. Bank v. Rodriguez Corp., 2 FSM Intrm. 86, 87 (Truk 1985).

Defendants PLA and the Etscheits originally filed separate motions for summary judgment, but by cross-stipulation have concurred with each other's presentations. The Etscheits also join in the United States' motion to dismiss. Most of the arguments of the United States in support of dismissing the action coincide with those of the other defendants. In addition, the United States argues sovereign immunity and lack of actionable conduct as grounds for dismissal of plaintiff's suit.

The defendants attack all of the public land statutes cited by plaintiff as irrelevant to this case, since the property at issue is private property. None of the public land laws give authority to the PLA to take over private property, nor do the statutes give authority to third parties such as the plaintiff to bring suit based on the PLA's failure to assert control over such land. D.L. 4L-153-78 states that the PLA is bound by all existing leases entered into by the TTPI. Defendant PLA takes this position with respect to the Etscheit lands. The TTPI government itself considered the land to be private land, and the property has never been conveyed by any act of government to the PLA.

Defendants reject plaintiff's argument that the TTPI government or the PLA had any duty to turn over public lands in Nett to plaintiff for distribution, even assuming that the property in this case were to be classified as public land. There is no provision in any of the public land laws stating such a requirement, nor is there any provision providing a private cause of action for money damages against the TTPI or PLA for failure to transfer public lands to a third party such as the Nahnken of Nett.

The defendants assert that this action is barred by the doctrine of res judicata. The plaintiff first asserted his rights over the land beginning in 1978, which caused the Etscheits to bring Civil Action No. 142-78 in the TT High Court. That court held in favor of the Etscheits. The Nahnken and Nanmwarki of Nett appealed and lost, and the appellate division of the TT High Court ruled that plaintiff had no legal interest in Mpomp. Therefore, defendants argue, the present case is simply another attempt by the plaintiff to relitigate the earlier quiet title action.

In Civil Action No. 142-78, In re Etscheits' Property (Dec. 24, 1980), the trial division of the TT High Court declared the Etscheit family to be the owners of Mpomp. One of the findings of the trial court was that during World War II, "the land in question was forcibly confiscated by the Japanese government and members of the Etscheit family were interned on Ponape by the Japanese." Opinion at 2. The 1956 Memorandum of Understanding stated the same conclusion, that the 1940-41 transfer of Mpomp to the Japanese was a forced sale made under duress, and therefore void. The appellate division of the TT High Court in reviewing the trial court decision did not reverse this finding. Plaintiff in this action has not presented any evidence to overcome the presumption of validity of the finding. The legal conclusion from this fact is that title to Mpomp never passed to the Japanese government during World War II. M.C. Dransfield, Annotation, Ratification of Contract Voidable for Duress 77 A.L.R.2d 426 (1961); 17A Am. Jur. 2d Contracts § 234 (1991). Title would have had to have effectively passed to the Japanese for plaintiff to prevail on his argument that the land is public land and not private property. All of the definitions of "alien property" or "public lands" in the laws plaintiff cites refer to Japanese owned land.4

It follows that if the Japanese never owned the land, none of the public land laws apply. This Court has already concurred in previous published opinions with the TT High Court's finding that the 1940-41 sale was forced. See Etscheit v. Adams, 6 FSM Intrm. 365, 370 (Pon. 1994). I therefore conclude that the property in question was never owned by the Japanese government. As such it did not revert in title to the Alien Property Custodian and its successor entity, the PLA.5

The conclusion that this property was not alien property or public land is implicit in the TT High Court's decision, affirmed on appeal in Nanmwarki, Nahnken of Nett v. Etscheit Family, 8 TTR 287 (App. 1982). The ruling of the TT High Court that the Nahnken of Nett does not own Mpomp is res judicata. It follows that the plaintiff is collaterally estopped from claiming damages as a result of loss of ownership or possession of the land. Under the principle of collateral estoppel, a cause of action which could have been litigated in the course of the original case between the same parties is treated as litigated and decided with the former cause of action. Berman v. FSM Supreme Court, 6 FSM Intrm. 109, 112 (Pon. 1993); Ittu v. Charley, 3 FSM Intrm. 188, 190 (Kos. S. Ct. Tr. 1987); 46 Am. Jur. 2d Judgments § 417 (1969). Plaintiff's claims for damages in this lawsuit for deprivation of use of the Etscheit property is directly dependent upon establishing a legal interest in the property, the very issue plaintiff litigated and lost earlier in the TT High Court. Plaintiff cannot thus disassociate his claims in this lawsuit from the prior conclusive judicial determination that he has no interest in Mpomp. See Williams v. Ward, 556 F.2d 1143, 1154-55 (2d Cir. 1977) (fact that remedy sought in second action differs from that sought in first action does not suffice to differentiate underlying claim to defeat application of res judicata).

(1) Plaintiff argues that the PLA should have been joined as an indispensable party in the TT High Court civil action, and that failure to do so renders the judgment void and subject to collateral attack. He cites several authorities for the principle that failure to join an indispensable party may render the judgment void. Most of the sources cited state only the well-established principle that in order for a judgment to be valid the issuing court must have had jurisdiction over the subject matter, 47 Am. Jur. 2d Judgments § 1064 (1969); 50 C.J.S. Judgments § 617 (1947), and that a party that originally consented to the jurisdiction of the court may later raise a claim that the same court lacked subject matter jurisdiction because jurisdiction does not originate from consent of the parties. 47 Am. Jur. 2d Judgments § 1081 (1969); Grubb v. Public Utilities Comm'n of Ohio, 281 U.S. 470, 475, 50 S. Ct. 374, 377, 74 L. Ed. 972, 977 (1930).

Relevant to plaintiff's argument are two cases, Stevens v. Loomis, 334 F.2d 775 (1st Cir. 1964) and Bank of California v. Superior Court of San Francisco, 106 P.2d 879 (Cal. 1940). These cases indeed hold that in some cases failure to join an indispensable party may subject the judgment to collateral attack. Both cases, however, make a distinction between "indispensable" and "necessary" parties. A necessary party is one who has an identifiable interest in the action and should normally be made a party to the lawsuit, but whose interests are separable from the rest of the parties or whose presence cannot be obtained. Bank of California, 106 P.2d at 884. Failure to join necessary parties does not defeat jurisdiction. Id.

In the Bank of California case, concerning distribution of a decedent's estate, some of the named defendants moved for an order to join other absent legatees as indispensable parties. The trial court denied the motion and petitioners applied for a writ of prohibition against the trial court. The appellate court ruled that the absent parties were necessary but not indispensable parties because their interests were separable and capable of independent adjudication. Id. at 885. An indispensable party is "one to whom any judgment, if effective, would necessarily affect his interest, or would, if his interest is eliminated, constitute unreasonable, inequitable, or impractical relief . . . ." Stevens, 334 F.2d at 777.

time the TT High Court action was brought. The PLA could, if it chose to, have intervened and asserted an independent right to the property in question based on the public land laws. It could still have brought such a claim after the decision against the Nanmwarki and the Nahnken was rendered. It is significant, however, that PLA did not make any effort on its own to assert such a claim at the time, nor did the Nahnken, as a party to the TT court action, make any motion under T.T.P.I. Civ. Pro. R. 19 to join PLA as a co-defendant. The Nahnken did not raise the issue of PLA's joinder until 11 years after the litigation had been completed. The burden of joining absent parties rests with the party asserting their indispensability. Sierra Club v. Watt, 608 F. Supp. 305 (D. Cal. 1985). Plaintiff in this case has not met this burden.

(2) Plaintiff's argument that the TT High Court lacked jurisdiction over the property in this matter is grounded in the belief that the land was public land and therefore subject only to PLA adjudication pursuant to Secretarial Order 2969. As discussed above, this premise is incorrect. Nothing in the FSM Constitution or the Trust Territory statutes prevented the TT High Court from exercising jurisdiction over land disputes, be it private or public land.

Plaintiff misinterprets Secretarial Order 2969, section 3(b) to mean that since the effective date of that order, December 28, 1974, the Trust Territory courts and Ponape District Land Commission had no authority to adjudicate claims involving public lands. Section 3 authorized the district legislature to "establish an adjudicatory body to resolve claims disputes as to titles or rights in land transferred to the district legal entity [PLA]." No such adjudicatory body was in existence at the time the Etscheits brought their civil action in 1978. Plaintiff, however, would interpret section 3 to mean that even in the absence of such an adjudicatory body, the TT High Court and Land Commission had no continuing jurisdiction over claims involving public lands. There is no language in the Secretarial Order to support such a view.

Section 3 states further that "no such body [created by the district legislature] shall have the authority to redetermine any claim or dispute as to right or title to land between parties or their successors or assigns where such claim or dispute has already been finally determined or is in the process of being determined either by a Land Title Officer, by a Land Commission or a court of competent jurisdiction, and all final determinations arising therefrom shall be res judicata." (emphasis added). Plaintiff would have the underlined portion of this provision mean that only claims resolved as of the effective date of the Secretarial Order are to be given res judicata effect. The Order should not be interpreted to leave a void in authority to adjudicate land claims, however, which would be the result if plaintiff's argument is accepted. The underlined portion can only logically refer to the effective date of establishment of the new adjudicatory body by the district legislature. Therefore, in 1978, the Land Commission and TT High Court had proper jurisdiction consistent with the provisions of S.O. 2969 over the property known as Mpomp, even if one were to accept plaintiff's characterization of the property as public land.

(3) Section 176 of the Compact of Free Association directs that final judgments of the TT High Court remain in effect after the effective date of the Compact. The courts of the FSM are given the authority, consistent with the Constitution, to grant relief from prior judgments of the TT High Court "in appropriate cases." This is consistent with the Transition Clause, FSM Const. art. XV, which also directs that judgments of the TT courts continue unaffected except as modified in accordance with constitutional provisions.

Plaintiff's other contention in this regard is that U.S. cases have not applied res judicata or collateral estoppel to previous judgments when doing so would result in manifest injustice or override important public policy. The rule, however, is that only truly exceptional cases warrant an exception to the normal presumption of res judicata, and that such exceptions are to be confined within narrow limits. 18 Charles A. Wright et al., Federal Practice and Procedure § 4426, at 268 (1981).

The principal case on which plaintiff relies, Moch v. East Baton Rouge Parish School Bd., 548 F.2d 594 (5th Cir. 1977), involved a class action challenging the apportionment of a school board. The suit was dismissed for failure to state a claim. The same plaintiffs then brought a second action two years later challenging the same apportionment. This suit was dismissed on res judicata grounds, citing the first decision. The Fifth Circuit held that a fundamental change in applicable law after the first decision was rendered made application of estoppel in the second action inappropriate. The change in law, regarding the Fifth Circuit and Supreme Court's opinions on the main issue presented in the case, would have yielded a different result on plaintiff's claims. I do not find the Moch case in any way analogous to the case at bar. There has been no fundamental change in the law at a constitutional level regarding the claims of plaintiff between 1978 and today.

Other cases cited by plaintiff do not help his argument. In United States v. LaFatch, 565 F.2d 81 (6th Cir. 1977), res judicata was not applied to an earlier judgment where the result would be to allow defendant to benefit from extortion at the expense of the government; the appellate court viewed this as contrary to public policy against solicitation of bribes for avoiding or circumventing federal securities regulations. The Court does not find that the TT High Court judgments rendered in 1980 and 1982 concerning the property in this case produced a result violative of any recognized public policy at the time or since. Likewise, other cases cited by plaintiff do not fit the circumstances of this case, such as a change of legal status of petitioner, Title v. INS, 322 F.2d 21, 25 (9th Cir. 1963); existence or likelihood of fraud in obtaining the initial judgment, United States v. Pueblo of Taos, 515 F.2d 1404, 1407 (Ct. Cl. 1975); or total lack of opportunity of petitioner to participate in first action affecting his legal interests through deficient notice, Smith v. United States, 403 F.2d 448, 450 (7th Cir. 1968). The Court finds no evidence from the record to indicate that the TT High Court decisions were obtained unfairly or worked a serious injustice, and no grounds to grant relief from them on such basis.

(4) Plaintiff misinterprets the Hamo and Oliver cases to mean that the FSM Supreme Court has no obligation to uphold prior verdicts of the Trust Territory courts. In FSM v. Oliver, 3 FSM Intrm. 469, 478 (Pon. 1988), the Court observed that the Judicial Guidance Clause, FSM Const. art. XI, § 11, assures that the Court "will not simply accept decisions of the Trust Territory High Court without independent analysis." The intent of this observation is that the FSM Supreme Court will not blindly apply the legal rulings of the TT High Court in deciding future cases. The Court in Oliver analyzed and accepted as sound an interpretation of 23 F.S.M.C. 105(3) rendered by the TT High Court in a 1971 case. Had the Court rejected the TT High Court's interpretation of the statute, the decision of the TT High Court in the earlier case as between those parties involved would not have been affected.

lacked jurisdiction over the matter. The appellate division found that the High Court had improperly exercised jurisdiction of the case for four years after the FSM Supreme Court was certified, in violation of Secretarial Order 3039, which required the transfer of all cases pending at the time of certification of a national constitutional court, excluding cases in active trial. The circumstances of the Hamo case do not apply to the present case, where it has been established that the TT High Court possessed jurisdiction.

Taken together, the Oliver and Hamo cases reinforce rather than undercut the principle that TT court judgments are to be given res judicata effect barring extreme circumstances such as fraud or complete lack of jurisdiction. The cases also hold that this Court is not bound to follow precedents or reasoning of TT High Court cases in deciding disputes before it. Plaintiff confuses the fundamental difference between following a decision as setting a precedent for future cases, and recognizing the resolution or outcome of a case as between the parties and subject matter of the particular action adjudicated. The former is rendered optional in the discretion of the court by the Judicial Guidance Clause and the holdings of Hamo and Oliver; the latter is required absent constitutional defect or obvious injustice by the FSM Constitution, article XV and section 176 of the Compact, as well as Hamo.

(5) The TT High Court was not bound to set out the precise dimensions of the property in its opinions. The appellate division of this Court has held that boundaries need not be determined prior to declaring ownership of a parcel of land referenced by name or general description. Wito Clan v. United Church of Christ, 6 FSM Intrm. 129, 133 (App. 1993). The Court takes judicial notice of an order issued by the trial judge in Civil Action 142-78 on August 26, 1980, which states that by stipulation the matter to be tried was "ownership of the land confined within the boundaries of Land Commission Sketch 166-1." The Order designates Land Commission Sketch 166-1 as an official court exhibit. The Respondents' (Nanmwarki and Nahnken of Nett) Trial Brief in Civil Action 142-78, at 5 (Dec. 12, 1980),7 states that in a pretrial conference on October 31, 1980, "the parties agreed that the petitioners will amend their pleadings, and this case will be a quiet title action as to all the land contained in Sketch No. 166-1." Judicial notice is also taken that the area of the land confined within the boundaries of Sketch 166-1 totals approximately 5,019,432 square meters, or slightly more than 1,250 acres. Therefore, plaintiff must be charged with at least imputed notice, if not actual notice, that the property designated "Mpomp" by the trial court

The Court finds that plaintiff's claim for damages from loss of use of Mpomp is foreclosed by the doctrine of laches. With regard to plaintiff's renewed challenge to the validity of the land transfers concerning this property dating from 1895 to the time of the TT High Court litigation, this Court concurs with the ruling of the TT High Court appellate division: "It is our position that the trial court was correct in finding that the appellants [Nanmwarki and Nahnken of Nett] are barred by the equitable doctrine of laches or stale demand from asserting any right or title to the land known as `Mpomp.'" Nanmwarki, 8 TTR at 291. It is far too late in the day to reallege the various flaws

The basic elements of the doctrine of laches are (1) inexcusable delay or lack of diligence by the plaintiff in bringing suit, and (2) injury or prejudice to the defendant from plaintiff's delay. Costello v. United States, 365 U.S. 265, 282, 81 S. Ct. 534, 543, 5 L. Ed. 2d 551, 562 (1961). Delay is inexcusable when the plaintiff knew or had notice of defendant's conduct giving rise to plaintiff's cause of action, and had prior opportunity to bring suit. 27 Am. Jur. 2d Equity § 162 (1966); Whitney v. Fox, 166 U.S. 637, 17 S. Ct. 713, 41 L. Ed. 1145 (1897) (laches should apply where the delay in assertion of rights is not adequately explained and such circumstances have intervened in the condition of the opposing party as to render it unjust to him that plaintiff's cause of action should succeed). The principle has been previously applied in this Court when a party has failed to assert its rights for a lengthy period and the opposing party has relied on the first party's nonassertion of those rights. NIH Corp. v. FSM, 5 FSM Intrm. 411, 414 (Pon. 1992); KCCA v. Tuuth, 5 FSM Intrm. 118 (Pon. 1991), rev'd on other grounds, 5 FSM Intrm. 375 (App. 1992).

The basic factors supporting application of laches are present in this case. The defendants' claims were apparent in the first instance in 1957 when the TTPI government quitclaim deeds to the property were issued to the Etscheits; in the second instance when the Etscheits brought their civil action in 1978 against the present plaintiff; and in the third instance in 1983 when the Land Commission issued a certificate of ownership to Mpomp to the Etscheit family.

Even if one were to assume the date of notice most favorable to plaintiff's position, 1983, the result is that it took ten years for the plaintiff to bring the present lawsuit. Plaintiff offers no excuse for this delay of a decade, except to allege that he had no notice of the issuance of certificates of title to the Etscheits by the Land Commission until 1992-93. This assertion is undercut in at least two ways. Plaintiff by his own admission states that he was aware of final denial of his claims by the Land Commission in 1983 ) at page 1 of his Cross-Motion for Summary Judgment, he responds to defendant PLA's charge that he failed to exhaust administrative remedies prior to bringing suit by stating, "No further steps need to be taken to finally deny the Iso Nahnken's claim. Issuance of title to the Etscheits is the most final possible denial in writing of the Iso Nahnken's claim to those lands." Second, knowledge of the relevant law regarding issuance of certificates of title following court determinations of ownership must be imputed to plaintiff, the losing party in TT High Court case. Section 108(5) of Title 67 of the Trust Territory Code states:

If a claim has been referred by a commission to the trial division of the high court without any determination by the commission, the trial division of the high court shall, after the time for appeal from its decision has expired without any notice of appeal having been filed or after an appeal duly taken has been determined, certify its decision, as modified by the appellate division if that has happened, to the land commission involved. The land commission shall then issue a certificate of title based on a determination of the commission as provided in section 117 of this chapter.

Section 117 of Title 67 states that the Land Commission shall issue a certificate of title which "shall be conclusive upon all persons who have had notice of the proceedings and all those claiming under them and shall be prima facie evidence of ownership as therein stated against the world . . . ." It is not unreasonable to hold plaintiff, who was represented by competent counsel at trial and on appeal, responsible for the knowledge that once a court made a determination of ownership the Land Commission was required to issue a certificate of title pursuant to the court's ruling. There

The Court concludes that plaintiff did know or should have known since 1983 of the Etscheits' title to the 1,250 acres of Mpomp. Yet plaintiff did not raise his claim for money damages for loss of the property until 1993. A change of attorneys years after the fact and discovery of new legal arguments does not overcome the application of laches to bar claims that could have been made at least ten years earlier. Prejudice to the defendant in permitting such claims to go forward is readily apparent in this case, since all parties opposing this action had a reasonable right to assume that litigation over the property was closed in 1982 with the TT High Court appellate decision. Defendants should not have to be hauled into court again to relitigate issues decided ten or more years ago.

Plaintiff has suggested that laches may not be asserted against government lands. As discussed above, the land at issue is not government land. Even if it were, plaintiff has not cited relevant supporting authority for his view. In suits brought by the U.S. government it has been held that laches cannot be asserted as a defense against claims founded on sovereign right or exercise of a governmental function. 27 Am. Jur. 2d Equity §156 (1966). However, this exemption is personal to the sovereign and does not pass to another litigant. Id. Specifically, where a suit is prosecuted in the name of the government but on behalf of an individual, laches may apply as a bar. Id. Thus in this case if the land in question were government land, the inapplicability of laches would be only with respect to the government as the party bringing the later claim, not a third party private individual charging breach of duty by the government. In other words, the Nahnken can not stand in the place of either the Trust Territory government or a branch of the former district or state government of Pohnpei, such as PLA, in invoking a sovereign rights exemption from laches as a bar to suit. This is especially true in light of the fact that all of the governmental entities involved in this lawsuit concur that the land at issue has been lawfully owned by the Etscheits for the entire relevant time period.

Plaintiff's claims to Sapwetik and Taketik are barred by laches for similar reasons. Although not part of the TT High Court actions concerning ownership of Mpomp, both areas were included in the 1956 MOU and 1957 quitclaim deeds. For the reasons discussed above, see supra note 7, the Nahnken must be charged with notice of the Etscheits claim to these areas at least as early as December 1978. He has not asserted any claim to them in court until 1993. Sapwetik was the subject of Land Commission proceedings in 1984, and the Land Commission issued a Determination of Ownership in favor of the Etscheits on October 22, 1984. The plaintiff claims that he cannot be bound by this determination because he had no notice of the proceedings. The record indicates, however, that plaintiff was present at the Land Commission proceedings representing Nett municipality's claim to the property. See Transcript of Testimonies of Hearing to Land T-75119 and T-75120 (Sapw[i]tik Island), attached as Exhibit "A" to Etscheit Defendants' Motion to Supplement Summary Judgment Memorandum (July 4, 1994).10 The record also shows that plaintiff was

With regard to Taketik there apparently has been no Land Commission determination of ownership. However, plaintiff has had notice and opportunity to raise a claim for loss of use of Taketik at least since 1978, when he had cause to be aware of the 1956 MOU and 1957 deeds including Taketik. Plaintiff alleges that he has only recently become aware that the Etscheits acquired a few acres in Taketik, but provides no evidence to rebut the documents submitted by defendants dating from the outset of the TT High Court litigation indicating that plaintiff was made aware of the contents of the 1956 MOU and 1957 deeds.

48 U.S.C. § 1501 et seq. was enacted by the U.S. Congress in 1887 and amended in 1897. Plaintiff has cited no authority for extending this particular statute to the TTPI, created in 1947 by the United Nations Trusteeship Agreement for the Former Japanese Mandated Islands ("Trusteeship Agreement," entered into force July 18, 1947, 61 Stat. 397, T.I.A.S. No. 1665, 8 U.N.T.S. 189). Plaintiff suggests that the TTPI was akin to an organized U.S. territory and included by inference within the purview of the U.S. Code provision since the U.S. Congress never stated at any time after the creation of the TTPI that this particular statute did not apply.

at arts. 75-91 of the United Nations Charter. Article 77 of the U.N. Charter states that U.N. trust territories include territories then held under League of Nations mandate, or which were detached from enemy states as a result of World War Two. Article 83 states that the Security Council must approve the terms of any trusteeship agreement relating to strategic areas, as well as any amendments of terms. Article 87 provides that the U.N. General Assembly and the Trusteeship Council (composed of Security Council members) shall monitor on a continuing basis the administration of the trust territories. Under article 2 of the Trusteeship Agreement, the U.S. is designated the administering authority of the TTPI. Therefore, the status of the TTPI was that of a strategic trust under the general jurisdiction of the Security Council and General Assembly of the U.N., administered by the U.S. government. This is not the same legal status as a U.S. territory, either incorporated or unincorporated, obtained by formal cession from another sovereign or acquired through military conquest.13

This fact was the basis of decision in Gale v. Andrus, 643 F.2d 826 (D.C. Cir. 1980), a case construing whether the U.S. Freedom of Information Act, 5 U.S.C. § 551, applied to the TTPI. The court in Gale concluded that "[u]ltimate review of the Trust Territory remained in the hands of the United Nations Trusteeship Council and Security Council." Gale, 643 F.2d at 829. With regard to what U.S. laws applied to the TTPI, article 3 of the Trusteeship Agreement provided that the United States "may apply to the trust territory, subject to any modifications which the administering authority may consider desirable such of the laws of the United States as it may deem appropriate to local conditions and requirements." Trusteeship Agreement art. 3. In accordance with the Trusteeship Agreement, therefore, the Gale court concluded that "[t]he laws of the United States do not automatically apply to the Territory unless they are specifically made applicable by Congress." Gale, 643 F.2d at 830 (emphasis in text). Article 3 has been interpreted to mean that for any particular U.S. statute to apply to the TTPI, Congress must have specifically manifested such an intent either in the language of the statute itself or in the legislative history. Id. at 834; People of Enewetak v. Laird, 353 F. Supp. 811, 815 (D. Haw. 1973). There is no such intent shown with respect to 48 U.S.C. § 1501 et seq., and the statute has never been amended to include the TTPI. Therefore I conclude that the statute does not apply to the TTPI.

The plaintiff contends that the United States breached its duty to ensure that all Trust Territory laws and regulations were enforced, and is liable to plaintiff for damages as a result. The U.S. duty was breached in two principal ways: (1) by allowing the Alien Property Custodian to quitclaim Mpomp in 1957, and by allowing the Land Commission to issue certificates of title to Mpomp in 1983 and a Determination of Ownership to Sapwetik in 1984.

Plaintiff relies further on Secretarial Order 3039, section 3(a), which mandated that the High Commissioner of the Trust Territory continue "to exercise all authority necessary to carry out the obligations and responsibilities of the United States under the 1947 Trusteeship Agreement, in order to ensure that no action (sic) are taken that would be inconsistent with the provisions of such Trusteeship Agreement, this Order, and with existing treaties, laws, regulations, and agreements generally applicable in the Trust Territory of the Pacific Islands." No authority has been found for interpreting this Order as providing a private right of action for money damages against the U.S. government based on alleged breach by the High Commissioner.

Since this case is one "in which damages are sought for . . . loss of property occurring where the action is brought," section 174(d) would appear to allow plaintiff's action on its face. Section 174(d) is a limited waiver of sovereign immunity. It must be read in conjunction with section 174(c), which allows for courts of the FSM to adjudicate claims against the Trust Territory government, or the United States in its place. Section 174(c) does not create new causes of action or remedies beyond what was available to private litigants before the Compact. See Alep, 6 FSM Intrm. at 219. What was available to private plaintiffs in tort actions against the Trust Territory can be found at 6 TTC 251(1)(c), which permitted

[c]ivil actions against the government of the Trust Territory on claims for money damages, accruing on or after September 23, 1967, for injury or loss of property, or personal injury or death caused by the negligent or wrongful act or omission of any employee of the government while acting within the scope of his office or employment, under circumstances where the government of the Trust Territory, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.

In regard to alleged tortious actions of Trust Territory (or the United States standing in its place) after September 23, 1967, the government is subject to liability for loss of property only under circumstances where a private person would be liable to claimant for similar acts. See Ikosia v. Trust Territory, 7 TTR 275, 277 (Yap 1975). Under the facts as alleged by plaintiff, there is no tortious action in depriving plaintiff of the use of the property in question for which a private person could be held liable because the acts complained of, i.e. declaring title to the property in the Etscheits, could only be accomplished by the administering governmental authority.15 If a private person attempted to transfer title to public lands to the Etscheits it would not constitute a tort resulting in loss of property because the entire act would be void from inception. The Court concludes therefore that plaintiff's suit is not of a class to which the United States government has

With regard to the actions of the Pohnpei Land Commission concerning this property, the Court does not find any actionable conduct attributable to the United States. Secretarial Order 2969, section 3 gave the district legislature "exclusive authority" to create a legal entity with exclusive responsibility and supervision of public lands. This grant of authority provided for the creation of the PLA. Section 3 of S.O. 2969 also gave the district legislature the authority to create a new adjudicatory body to resolve disputes relating to public lands transferred to PLA. As has been discussed supra, the Ponape district legislature had not created this new adjudicatory body as of 1983-84, when the Land Commission acted with respect to the property in this case. The United States could not assume responsibility for the absence of another adjudicatory body for public land disputes as authorized by section 3(b) of S.O. 2969, since the exclusive authority to establish such a body had been transferred to the Ponape district legislature. No legal authority has been found for the proposition that the United States could have and should have forced the Pohnpei district legislature to act in establishing a public lands adjudicatory body.

Section 4 of S.O. 2969 gave the High Commissioner authority to convey all right, title and interest of the TTPI government in public lands to the district legal entity created under section 3. The High Commissioner exercised this authority with respect to Pohnpei by execution of a quitclaim deed to all public lands defined by Secretarial Order 2969, section 2(c) to the PLA on February 15, 1979.16 Therefore, after February 15, 1979, the United States no longer retained any interest in or administrative responsibility for public land in Pohnpei.

Similarly, even accepting as correct plaintiff's contention that the Land Commission possessed no authority to decide ownership or issue certificates of title to the property in this case, such action cannot be construed to create liability of the United States government. The Land Commission was established by 67 TTC 101, 102 under the administrative authority of the Trust Territory chief of lands and survey. This fact did not make the Land Commission an agency of the United States government. See McComish v. Commissioner, 580 F.2d 1323, 1328 (9th Cir. 1978); Porter v. United States, 496 F.2d 583, 589 (Ct. Cl. 1974) (holding that the Trust Territory government was not a U.S. federal agency). Therefore any action of the Land Commission in excess of its statutory authority would be actionable only against the Commission itself, not the United States.

As against defendants Pohnpei Public Lands Authority and the Etscheits, plaintiff may not recover on his claims as a matter of law on grounds of res judicata. Regardless of the veracity of his allegations, his claims are barred by laches. As against the United States, the action must be dismissed for failure to state a claim upon which relief may be granted, FSM Civ. R. 12(b)(6), on grounds of sovereign immunity and lack of a showing of actionable conduct by the U.S.

claims based on ownership of the land at that time. With regard to Sapwetik and Taketik, the Court finds that plaintiff must be held at minimum with a responsibility and reasonable opportunity to have discovered and challenged the Etscheits' claim of ownership and any damages to plaintiff resulting thereof at least ten years ago. This is not a case in which public information was purposely concealed or made unavailable absent extraordinary effort. The Court stands ready to assist litigants with claims that are well-grounded in law and diligently brought. At the same time the Court must strive to ensure that the final judgments fairly rendered are upheld, so that all interested parties may know when an issue has been justly concluded. In the case at bar, all of the defendants were entitled to rely on the conclusiveness of prior decisions recognizing ownership of the property in the Etscheit family. To allow plaintiff to question this conclusiveness after passage of a decade in the form of a request for damages would ill serve the interests of justice and the judicial system of this young nation.

2. S.L. 1L-155-87 superseded D.L. No. 4L-69-76 (Ponape Dist. Legis., 3rd Reg. Sess. 1976). D.L. No. 4L-69-76 created the Ponape District Public Lands Authority as the entity to receive and hold title to public lands in trust for the people of the district, § 10(2)), and to administer and manage use of public lands in trust, § 10(3)). S.L. 1L-155-87 formally designated the Pohnpei Public Lands Board of Trustees as the entity entrusted with all rights, title and interest to public lands in Pohnpei.

4. See Trust Territory Interim Regulation 6-48, art. II (alien property defined as "property situated in the Trust Territory, formerly owned by private Japanese nationals, private Japanese organizations, or by the Japanese Government . . . "); 27 TTC 1 (same definition); Secretarial Order 2969, § 2(c)(1) (defines public lands by reference to 67 TTC 1, which states that public lands are "those lands situated within the Trust Territory which were owned or maintained by the Japanese government as government or public lands . . . "); id. § 2(c)(2) (reference to 27 TTC 1); Pohnpei Public Lands Act of 1976, D.L. 4L-69-76, § 3(7) (refers to the definition in Secretarial Order 2969). There is no evidence in the record that the Etscheit land was "maintained by the Japanese government as government or public lands," such that plaintiff could find support in this part of 67 TTC 1.

5. Plaintiff suggests that the fact that the Trust Territory entered into an agreement in 1956 with the Etscheits in which the Etscheits paid a sum of money and exchanged other land parcels for deeds to Mpomp, Sapwetik and Taketik indicates that title had passed to the Trust Territory government as the successor to the Japanese government. This fails to take into account the stated land policy of the TTPI government, as described in Trust Territory Land Policy Letter P-1 (Dec. 1947), which plaintiff attaches as Exhibit "C" to his Cross-Motion for Summary Judgment (May 31, 1993). Paragraph 6 of the Policy Letter declared that transfer of title of lands previously declared in rulings by the German and Japanese administrations to be public domain, by virtue of not being used continuously by native people, would not be considered valid if transfer was made to non-natives. The definition of "native" in the same Policy Letter at paragraph 19 reads: "a person who does not owe allegiance to a government other than that of the Trust Territory and who was either born in the Trust Territory [or] had established residence therein prior to December 7, 1941, and has resided therein since September 1, 1946." Florentine Etscheit would arguably have met this definition. Although still a Belgian citizen in 1956, she had resided in the Trust Territory for over fifty years. Furthermore, there has never been a ruling by the German or Japanese administrations declaring the lands at issue in this case to be public domain. Paragraph 13 of the Policy Letter stated that land transfers from non-Japanese private owners to the Japanese government after 1935 would not be considered valid if the former owner established that the sale was not made of free will. In such cases, title would be returned to the former owner by the Trust Territory upon payment to the TTPI government of the amount received by him from the Japanese. This appears to be precisely the transaction that took place between the Etscheits and the TTPI government through the 1956 MOU. While Land Policy Letter P-1 does not have force of law, it is persuasive in indicating the intent behind the TTPI government actions with regard to the property in this case.

9. Although it has not been adequately demonstrated to the Court at what exact time plaintiff had actual notice of the 1956 MOU and the Etscheits' claim to Mpomp as being approximately 1,250 acres, it is evident from the record that plaintiff can be assigned imputed knowledge of the extent of the Etscheits' claim at least as of early December 1978. See, e.g., Letter of F. Castro, Senior Land Commissioner (Dec. 1, 1978) (attached as Exhibit "H" to Etscheit Defendants' Notice of Joinder (July 27, 1994)), in which Mr. Castro states that he informed the Nahnken verbally on November 30, 1978 at the Land Commission office that the Trust Territory recognized the Etscheits' ownership of Mpomp based on what was said in the 1956 MOU; Order of the Trust Territory High Court in Civil Action No. 142-78, para. 5 (Dec. 8, 1978) (attached as Exhibit "D" to Etscheit Defendants' Notice of Joinder), in which the court ordered that "a copy of any and all papers, records, or documents, including the various surveys and the translated German records [concerning the property in dispute], shall be furnished to the Naniken, Nett Municipality . . . ."

10. Plaintiff challenges the authenticity of this transcript on grounds that it is not accompanied by a written certification from a document custodian. Plaintiff fails to adduce, however, any other evidence casting doubt on the trustworthiness of the transcript copy. The Court notes that the transcript copy is used in this instance not for what it states was said at the hearings, but only as one of several indications that plaintiff was aware of the Land Commission proceedings.

11. See Notice of Formal Hearing No. 133, by the Land Commission and Land Registration Team (Feb. 7, 1984); Notice of Service for Formal Hearing No. 133 (bearing the Iso Nahnken's signature) (dated the same day). Plaintiff suggests that the number "133" may have been handwritten in the blank on the notice of service at a later time, but presents no evidence supporting this accusation. The signatures on the notice are those of persons claiming interest or representing those with interests in Sapwetik at the time. Plaintiff's counsel raises rhetorically the question whether the signature is that of the Iso Nahnken, suggesting that it is not similar to any of plaintiff's other signatures on file. The Nahnken himself has not filed an affidavit disclaiming the signature as his own, however. In the absence of any credible evidence to the contrary, the Court finds that the notice of formal hearing No. 133 concerning Sapwetik was served on plaintiff.

12. Plaintiff claims that he was not served with personal notice of the determination of ownership pursuant to 67 TTC 114. Even assuming this to be so, plaintiff should have been aware of the outcome by means of the public notice issued. Particularly as an interested party with notice that discussions concerning Sapwetik were being held, plaintiff should have, as a reasonable person would under the circumstances, made an effort to follow up on what the Land Commission decided.

13. Justice White in the case Downes v. Bidwell, 182 U.S. 244, 311-12, 21 S. Ct. 770, 796, 45 L. Ed. 1088, 1115-16 (1901) (White, J., concurring) noted a distinction between incorporated and unincorporated territories. The former (e.g., Louisiana and Florida before statehood) were from the outset of acquisition treated as an integral part of the United States in all respects. The latter (e.g., Puerto Rico) were not recognized at the time of acquisition as an integral part of the United States and all U.S. laws did not automatically apply to them.

15. With respect to claims arising out of the acts or omissions of government employees in the execution of laws and regulations, 6 TTC 252(2) states that the court shall have no jurisdiction over such claims where the employees acted with due care. Accordingly, the Trust Territory High Court held that an action against the High Commissioner could be maintained where the complaint alleged the Commissioner acted without due care in violation of existing law. Guerrero v. Johnston, 6 TTR 124 (Mrns. 1972). In such instance the exception to jurisdiction found at 6 TTC 252(2) would not apply because the individual government official would be acting outside the scope of his statutory authority and his actions could not be attributed to the sovereign. "The primary inquiry must be whether the employee of the government was acting within the scope of his statutory powers; if he was, and the only challenge is as to the manner in which he executed those powers or exercised the discretion confided in him by law, then his acts would be those of the government and the cited exception would bar this court from taking jurisdiction." Guerrero, 6 TTR at 126-27.

Analyzing plaintiff's claims in this regard admits of two possibilities. First, taking plaintiff's argument at its face, the High Commissioner and Alien Property Custodian acted beyond the scope of their authority in issuing deeds to the property to the Etscheits in 1957. Thus, 6 TTC 252(2) would not apply to bar plaintiff's claims. However, the suit would then not be against the United States but against the officials in their individual capacity, and the acts of those officials would not be attributable to the U.S.

The second possibility is that the Trust Territory officials at the time were acting within their designated authority, but made the wrong decisions in exercising discretionary duties charged to them. The Court notes in this regard 27 TTC 2(1), which instructs that the Alien Property Custodian "is empowered to hold, use, administer, liquidate, sell or otherwise deal with alien property in the interest and for the benefit of the indigenous inhabitants of the Trust Territory, in accordance with the terms of the trusteeship agreement . . . ." This provision, which plaintiff charges has been violated in this case, accords the Trust Territory official with a broad grant of discretionary authority in the administration of public lands. There is no definition in Title 27 of "indigenous inhabitants," nor is there one to be found in the Trusteeship Agreement, Secretarial Order 2969 or Interim Regulations 4-48 and 6-48, all of which plaintiff cites in conjunction with the duties of the Trust Territory regarding the property in this case. Therefore it cannot be said that the transfer of the property to the Etscheits was not, in the Alien Property Custodian and Trust Territory government's view, a discharge of the property "for the benefit of the indigenous inhabitants."

Moreover, plaintiff has not shown beyond the general contention that as Nahnken of Nett he possessed traditional authority to distribute land, that 27 TTC 2(1) and the other provisions cited translated into a statutory duty of the Trust Territory government to transfer public lands to him. Plaintiff attempts to bootstrap provisions of the Pohnpei and FSM Constitutions regarding respect for the roles of traditional leaders on to the TTPI laws regarding public land disposition. This exercise, however, cannot create a mandatory legal duty on the part of another sovereign government where none exists.