KOSRAE STATE COURT TRIAL DIVISION

Cite as Skilling v. Kosrae,9 FSM Intrm. 608 (Kos. S. Ct. Tr. 2000)

[9 FSM Intrm. 608]

SHIRO N. SKILLING,

Plaintiff,

vs.

STATE OF KOSRAE,

Defendant.

CIVIL ACTION NO. 75-00

ORDER

Yosiwo P. George
Chief Justice

Hearing: December 14, 2000
Decided: December 27, 2000

APPEARANCES:

For the Plaintiff:              Sasaki George, Esq.
                                       Micronesian Legal Services Corporation
                                       P.O. Box 38
                                       Lelu, Kosrae FM 96944

For the Defendants:       April D. Douglas, Esq.
                                       Assistant Attorney General
                                       Office of the Kosrae Attorney General
                                       P.O. Box 870
                                       Lelu, Kosrae FM 96944

[9 FSM Intrm. 609]

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HEADNOTES

Civil Procedure – Summary Judgment

Summary judgment is appropriate when, viewing the facts in the light most favorable to the party against whom judgment is sought, there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Skilling v. Kosrae, 9 FSM Intrm. 608, 610 (Kos. S. Ct. Tr. 2000).

Statutes of Limitation

In general, a cause of action accrues when the right to bring suit on a claim is complete. The true test in determining when a cause of action arises or accrues is to establish the time when the plaintiff could have first maintained the action to a successful conclusion. Skilling v. Kosrae, 9 FSM Intrm. 608, 611 (Kos. S. Ct. Tr. 2000).

Public Officers and Employees – Kosrae

Under Kosrae State Code, Title 18, there is no limitation on the Kosrae State Court's jurisdiction to hear claims based upon a grievance, filed by a former Executive Branch employee. There is no limitation on a plaintiff's right, as a former employee, to file suit on his grievance and his right to file suit on his grievance arose in 1997, when he took early retirement and terminated his state employment. Skilling v. Kosrae, 9 FSM Intrm. 608, 612-13 (Kos. S. Ct. Tr. 2000).

Public Officers and Employees – Kosrae; Statutes of Limitation

While the plaintiff was a state employee, he was subject to the administrative procedures specified for grievances, but when his administrative action was still pending when he retired in 1997, because his grievance had never been ruled on, he was no longer an employee required to comply with the administrative procedures. His right to bring suit on his claim did not become complete and his cause of action therefore did not accrue his early retirement resulted in termination from state government employment. Skilling v. Kosrae, 9 FSM Intrm. 608, 613 (Kos. S. Ct. Tr. 2000).

Equity – Laches

The doctrine of laches is applied only where it would be inequitable to allow a person making a belated claim to prevail. Each case is governed chiefly by its own circumstances. The equitable defense of laches has two elements: the passage of a nonspecific amount of time during which the plaintiff engages in inexcusable delay or lack of diligence in bringing suit, and resulting prejudice to the defendant. Laches is always applied separate from and irrespective of the statute of limitations. Skilling v. Kosrae, 9 FSM Intrm. 608, 613 (Kos. S. Ct. Tr. 2000).

Equity – Laches

In determining whether to apply laches, the resulting prejudice to the defendant is explored first. There are two types of prejudice that may stem from delay in filing suit. The adverse party may be unable to mount a defense because of loss of records, destruction of evidence, missing witnesses, and the like, or the prejudice may be economic. Skilling v. Kosrae, 9 FSM Intrm. 608, 613 (Kos. S. Ct. Tr. 2000).

Equity – Laches

A predicate to reliance on the doctrine of laches is that he who would invoke it must have clean hands, and must have acted properly concerning the subject matter of the litigation. Generally, a party who has failed to act properly a party who has "unclean hands" cannot invoke an equitable doctrine such as laches. Skilling v. Kosrae, 9 FSM Intrm. 608, 613 (Kos. S. Ct. Tr. 2000).

[9 FSM Intrm. 610]

Equity – Laches; Public Officers and Employees – Kosrae

When two Directors of Education failed to act properly by not acting upon the plaintiff's grievance and not making a written finding on plaintiff's grievance, as required by regulation, the State cannot invoke the equitable doctrine of laches in its defense. Skilling v. Kosrae, 9 FSM Intrm. 608, 613 (Kos. S. Ct. Tr. 2000).

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COURT'S OPINION

YOSIWO P. GEORGE, Chief Justice:

Defendant filed a Motion for Summary Judgment on November 2, 2000. Plaintiff filed an Opposition on November 13, 2000. Defendant's Motion for Summary Judgment was heard on December 14, 2000. Sasaki George, MLSC, appeared for the Plaintiff. April Douglas, Assistant Attorney General, represented the Defendant.

Based upon the information submitted before this Court, the Defendant's Motion, Plaintiff's Opposition, the arguments at the hearing, the record in this matter, and in the interest of justice, the Court rules as follows: Defendant's Motion for Summary Judgment is denied. The Court's reasoning follows.

I. STANDARD FOR SUMMARY JUDGMENT.

Summary judgment under KRCP Rule 56 is appropriate when, viewing the facts in the light most favorable to the party against whom judgment is sought, there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Weno v. Stinnett, 9 FSM Intrm. 200, 206 (App. 1999).

II. BACKGROUND.

This case involves a salary claim by a former Kosrae State Executive Branch employee. Plaintiff claims that he was reallocated from a Custodial Worker to Building Maintenance in 1987, but did not receive the salary increase, a one-step increase, that he was entitled to. Plaintiff claims that he submitted his grievance to the State, but that the State did not hear Plaintiff's grievance. Defendant answered the complaint, alleging several affirmative defenses.

The issue presented at the hearing, critical to the application of the State's affirmative defense of the statute of limitations is the "accrual of the cause of action" under the Kosrae State Code. Based upon this Court's decision in the case of Sepe Abraham v. State, Civil Action No. 12-98 [Abraham v. Kosrae, 9 FSM Intrm. 57 (Kos. S. Ct. Tr. 1999)], I find that in this case, the Plaintiff's cause of action accrued in 1997, when Plaintiff retired from State employment. Therefore, Plaintiff's claims made in this case are not barred by the statute of limitations.

Defendant argues that Plaintiff's claim accrued in 1987, when he was reallocated, or at the latest, in November 1991, when MLSC wrote a letter on his behalf to the Director of Education at that time, the late Luey Luey. If Defendant's theory is correct, then Plaintiff's claim is barred by the statute of limitations, because this action was filed more than six years after 1991.

Plaintiff argues that his action accrued in June 2000, when the Executive Branch failed to respond to Plaintiff's letter dated June 28, 2000. Under Plaintiff's theory, the statute of limitations began to

[9 FSM Intrm. 611]

run when the administrative process became futile: when the State did not respond to Plaintiff's latest submission in June 2000. If Plaintiff is correct, then the statute of limitations has not run and Defendant's Motion for Summary Judgment must be denied.

There are several undisputed facts relating to this case. In April 1987, Plaintiff was reallocated from Custodial Worker II to Building Maintenance Man. Plaintiff should have received in increase in his pay level from PL 2/10 to PL 7/6. Plaintiff knew of his reallocation and requested in writing an increase in salary by letter to his supervisor Kosrae High School Principal Joel Tilfas, dated September 1, 1987. Mr. Tilfas did not resolve Plaintiff's grievance to Plaintiff's satisfaction. Plaintiff then retained MLSC, who wrote a letter on his behalf to the Director of Education on November 4, 1991, requesting a step increase. The former Director of Education, the late Luey Luey, never responded to the November 4, 1991 letter. Then Plaintiff took no action for nearly seven years, until Plaintiff, through MLSC, again wrote to the current Director of Education, in April 1998, again requesting a grievance hearing. No action was taken by Director Henry E. Robert. Plaintiff made other submissions to the State during this year, 2000, in support of his claim for salary increase.

III. LEGAL ANALYSIS

The applicable six year statute of limitations is set forth in Kosrae State Code, Section 6.2506. Kosrae State Code, Section 6.2506 states that "commencement of an action . . . occurs only within six years after accrual of the cause of action." The question presented here is: When did the Plaintiff's cause of action accrue? In general, a cause of action accrues when the right to bring suit on a claim is complete. The true test in determining when a cause of action arises or accrues is to establish the time when the plaintiff could have first maintained the action to a successful conclusion. Mid-Pacific Constr. Co. v. Semes (I), 6 FSM Intrm. 171, 176 (Pon. 1993). Therefore, the question presented is now stated: When did the Plaintiff's right to bring suit on his claim become complete?

Plaintiff's claim is made under prior law, Kosrae State Code, Title 5, Chapter 4, governing the Executive Service. Kosrae State Code, Section 5.429 provides that by regulation, the Director of the Office of Personnel and Employment provides a procedure for the presentation and hearing of a grievance by an employee.

The Executive Service Regulation 11, which became effective in January 1987, is applicable to Plaintiff's claim. Regulation 11, Section 11.2 permits employees to present their grievances according to the administrative procedure, first to the supervisor, then to the Director of the Department. In accordance with the administrative procedure, Plaintiff submitted his grievance first to his supervisor, the Principal of Kosrae High School, Mr. Joel Tilfas. Mr. Tilfas did not settle the Plaintiff's grievance to Plaintiff's satisfaction, therefore, the Plaintiff submitted his grievance to the Director of Education, the late Luey Luey, in November 1991, through MLSC. Under former Regulation 11, Section 11.2, the Director was required to make written findings on the Plaintiff's grievance. Section 11.2 does not set a specific time period for the Director to act. Therefore the administrative action by Director Luey was still pending when the Plaintiff's grievance was submitted a second time to the current Director of Education, Henry E. Robert, in April 1998. This submission was apparently made subject to Kosrae State Regulation 11, Section 11.2, which was still in effect at that time. Again, Director Henry E. Robert did not make any written findings with respect to the Plaintiff's grievance.

Regulation 11, Section 11.2 sets out the required administrative grievance procedure for employees. While the Plaintiff was a state employee, until 1997, he was subject to the administrative procedure for the hearing of grievances. In April 1998, Plaintiff was no longer a State employee, therefore the Regulation 11, Section 11.2, prescribing the administrative procedure for grievances was not applicable to the Plaintiff. The submission of Plaintiff's claim to Director Henry Robert was not

[9 FSM Intrm. 612]

required since Plaintiff was no longer a State employee.

The application of the public service administrative process to non-employees was addressed in case of Sepe Abraham v. Kosrae, Civil Case No. 12-98. In the Court's ruling entered on February 25, 1999, this Court held that:

Kosrae State Code, Title 5, Section 5.101(8) defined "employee" as "executive employee in a temporary or permanent position in the Executive. A "grievance" is an employee action to present and resolve a difficulty or dispute arising in the performance of his duties and not from a disciplinary action. Kos. S.C. § 5.101(12).

Regulation 11, Sections 11.1 and 11.2 addressed the grievance procedure. Section 11 permitted a grievance to be presented by any permanent Executive Service System employee. Under Regulation 11, Section 11.2, employees were required to follow certain procedures in presenting their grievances.

The definitions in S.L. No. 6-131, codified at Kosrae State Code, Title 18 are similar. "Employee" means a person holding a position in the public service, whether permanently or otherwise. Kos. S.C. § 18.201(7). Title 18, Section 18.404, which addresses grievances, states that: "The Branch heads shall prescribe a system for hearing the views of employees on their working conditions, status, pay, and related matters, and for hearing and adjudicating grievances of any employee or group of employees."

Section 18.404 only refers to employees. There are no provisions in Title 18 that prohibit an the filing of a civil action by non-employee for a grievance based upon facts which occurred during his or her employment with the State Government. Title 18 provides, that for employees, an administrative procedure must be followed first, as prescribed by their branch heads.

Kosrae State Code, Section 18.507 provides certain limitations on judicial review. The provision states: "Disciplinary actions taken in conformance with this Chapter shall in no case be subject to review in the Courts until the administrative remedies prescribed herein have been exhausted." Disciplinary actions are described in Sections 18.501 and 18.502 as suspensions, demotions and dismissals. Grievances are not disciplinary actions. Section 18.507 does not provide any limitations on the Court's review of grievances or grievance appeals. Therefore, there is no limitation of judicial review in Title 18 with respect to grievances.

. . . .

Plaintiff, at the time of filing the complaint, was no longer an employee of the Executive Branch, therefore, the provisions of Regulation 11 and Title 18 do not apply to her. Finally, Title 18 does not impose any restrictions on this Court's jurisdiction over claims based upon grievances of non-employees.

[Abraham v. Kosrae, 9 FSM Intrm. 57, 61 (Kos. S. Ct. Tr. 1999).]

In the case of Sepe Abraham v. State, this Court concluded that under Kosrae State Code, Title 18, there is no limitation on this Court's jurisdiction to hear claims based upon a grievance, filed by a former employee of the Executive Branch. Applying our Court's precedent to this case, there is no limitation on Plaintiff Skilling's right, as a former employee, to file suit on his grievance. Plaintiff's right

[9 FSM Intrm. 613]

to file suit on his grievance arose in 1997, when Plaintiff took Early Retirement and terminated his employment with the State. Therefore, the accrual of Plaintiff's cause of action occurred in 1997, when he terminated his employment with the State and was no longer subject to the administrative procedures required by Kosrae State Code, Title 5 (repealed) and Title 18.

In conclusion, while the Plaintiff was an employee, he was subject to the administrative procedures specified for grievances. Under Kosrae State Code, Title 5 (repealed) and Regulation 11 (repealed). Plaintiff's administrative action was still pending when he retired in 1997, because then Director of Education the late Luey Luey had never ruled on his grievance. In 1997, Plaintiff terminated his employment with the State and was no longer an employee required to comply with the administrative procedures.

Based upon this analysis, both the Plaintiff's and the Defendant's proposed dates for accrual of Plaintiff's cause of action are rejected. Instead, Plaintiff's right to bring suit on his claim become complete and the date of accrual of Plaintiff's cause of action occurred in 1997, when Plaintiff's early retirement resulted in termination from Kosrae State Government employment. See Abraham v. Kosrae, 9 FSM Intrm. 57, 61 (Kos. S. Ct. Tr. 1999). Therefore, the statute of limitations does not bar maintaining this suit. Defendant's argument that this suit is barred by the statute of limitations must be rejected.

Defendant, in its Motion for Summary Judgment, also argues that the doctrine of laches bars this suit. The doctrine of laches is applied only where it would be inequitable to allow a person making a belated claim to prevail. Each case is governed chiefly by its own circumstances. Nahnken of Nett v. Pohnpei, 7 FSM Intrm. 485, 491 (App. 1996). The equitable defense of laches has two elements: the passage of a nonspecific amount of time during which the plaintiff engages in inexcusable delay or lack of diligence in bringing suit, and resulting prejudice to the defendant. Laches is always applied separate from and irrespective of the statute of limitations. Id. at 489. This Court must determine whether the elements of defense of laches has been satisfied.

The resulting prejudice to the defendant is explored first. There are two types of prejudice that may stem from delay in filing suit. The adverse party may be unable to mount a defense because of loss of records, destruction of evidence, missing witnesses, and the like, or the prejudice may be economic. Id. at 490. Defendant, in its Motion, claims that it would be "fundamentally unfair" to the State to proceed on Plaintiff's claim at this late date. However, Defendant does not specify any specific types of prejudice which may result from the delayed prosecution of Plaintiff's claim. One element of the defense of laches, resulting prejudice to the defendant, has not been satisfied.

Further, a predicate to reliance on the doctrine of laches is that he who would invoke it must have clean hands, and must have acted properly concerning the subject matter of the litigation. Mid-Pacific Liquor Distrib. Corp. v. Edmond, 9 FSM Intrm. 75, 78 (Kos. 1999). Generally, a party who has failed to act properly a party who has "unclean hands" cannot invoke an equitable doctrine such as laches. Nahnken of Nett, 7 FSM Intrm. at 491. Here, both Directors of Education, the late Luey Luey and Henry E. Robert, failed to act properly. They did not act upon the Plaintiff's grievance, as required by Regulation 11, Part 11.2(b). Neither Director of Education made a written finding on Plaintiff's grievance, as required by regulation. Accordingly, the Defendant State cannot invoke the equitable doctrine of laches in its defense. Defendant's argument that this suit is barred by the doctrine of laches must be rejected.

IV. CONCLUSION

Based upon the facts and the analysis above, the Defendant is not entitled to judgment as a matter

[9 FSM Intrm. 614]

of law, under KRCP Rule 56. Defendant's Motion for Summary Judgment is denied.

Pre-trial briefs shall be filed and served no later than January 2, 2001. Trial is set for January 9, 2001, at 9 a.m.

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