Cite as FSM v. Este,12 FSM Intrm. 476 (Chk. 2004)

[12 FSM Intrm. 476]

CRIMINAL CASE NO. 2002-1500

Trial: March 9-12, 29-31, 2004
Decided: May 31, 2004
Corrected: June 1, 2004

APPEARANCES:

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HEADNOTES

Administrative Law

The Financial Management Regulations, effective June 14, 1999, apply to the obligation and disbursement of funds from a lump sum appropriation for the purpose of funding health, education, infrastructure and other public projects. FSM v. Este, 12 FSM Intrm. 476, 481 (Chk. 2004).

Constitutional Law – Judicial Guidance Clause; Custom and Tradition – Chuuk

When the project control document did not say otherwise, the community halls contemplated by the Uman Social Project project control document are the customary and traditional community hall (an wuut or uut) found in Uman (and throughout the Southern Namoneas and Chuuk Lagoon) because this is the meaning of the term community hall (wuut or uut) as understood by the defendants, who are all from the Southern Namoneas and because is this is not only the only logical conclusion to draw under the circumstances, this result is mandated by the Judicial Guidance Clause, which requires all judicial decisions to be consistent with custom and tradition. FSM v. Este, 12 FSM Intrm. 476, 481 (Chk. 2004).

Criminal Law and Procedure – Conspiracy

A person commits the offense of conspiracy, if, with intent to promote or facilitate the commission of a national offense if he agrees with one or more persons that they, or one or more of them, will engage in or solicit the conduct or will cause or solicit the result specified by the definition of the offense; and he or another person with whom he conspired commits an overt act in pursuance of the conspiracy. FSM v. Este, 12 FSM Intrm. 476, 483 (Chk. 2004).

Criminal Law and Procedure – Conspiracy

The agreement in a conspiracy does not have to be explicit. A mere tacit understanding will suffice, and there need not be any written statement or even a speaking of words which expressly communicates the agreement. FSM v. Este, 12 FSM Intrm. 476, 483 (Chk. 2004).

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Criminal Law and Procedure – Conspiracy

A conspiracy exists when either the agreement or the means contemplated for its achievement are unlawful. FSM v. Este, 12 FSM Intrm. 476, 483 (Chk. 2004).

Criminal Law and Procedure – Conspiracy

When it was unlawful and a national offense for any of the Uman Social Project funds to be spent on anything other than the construction of six new community halls on Uman, an agreement to do so would thus constitute the national offense of conspiracy. A single overt act committed by one of the co-conspirators before the end of the conspiracy is sufficient for there to be criminal liability for conspiracy. FSM v. Este, 12 FSM Intrm. 476, 483 (Chk. 2004).

Criminal Law and Procedure – Conspiracy

Conspiracy to commit a crime is an offense separate and distinct from the crime that is the object of the conspiracy. FSM v. Este, 12 FSM Intrm. 476, 483 (Chk. 2004).

Criminal Law and Procedure – Conspiracy

It is not necessary to prove the specific terms or the specific scope of the conspiratorial agreement or to prove that the conspiracy's substantive object was accomplished. FSM v. Este, 12 FSM Intrm. 476, 483 (Chk. 2004).

Criminal Law and Procedure – Conspiracy

The existence of, and participation in, a criminal conspiracy may be proved by circumstantial as well as by direct evidence, if it affords a reasonable inference as to the ultimate facts sought to be proved. There must be evidence of some participation or interest in the commission of the offense. FSM v. Este, 12 FSM Intrm. 476, 483 (Chk. 2004).

Criminal Law and Procedure – Conspiracy

The trial court is allowed great discretion in the reception of circumstantial evidence, for a conspiracy must be proved by a number of indefinite acts, conditions, and circumstances varying with the purpose to be accomplished. When it is shown that the defendants by their acts pursued the same object, one performing one part and the other performing another part so as to complete it or with a view to its attainment, the trier of fact will be justified in concluding that they were engaged in a conspiracy to effect that object. Most conspiracy convictions are based on circumstantial evidence. FSM v. Este, 12 FSM Intrm. 476, 483 (Chk. 2004).

Criminal Law and Procedure – Conspiracy

A finding by the court that there is insufficient evidence to convict all but one of the parties alleged to have participated in a conspiracy ordinarily requires the discharge of the one remaining defendant. FSM v. Este, 12 FSM Intrm. 476, 484 (Chk. 2004).

COURT'S OPINION

MARTIN G. YINUG, Associate Justice:

Trial was held in this matter on March 9-12, 29-31, 2004. The court heard the testimony of Rose Nakanaga, Jason Poll, Raify Saimon, Steve Matisima, Nio Jonas, Henzel Akapito (testifying under use immunity), Sgt. Ben Bakin, Catalina Donre, Investigator Danny Sancher, Inspector Flethcer Poll, and Kachuo Enary. Based upon the witnesses' testimony and the exhibits admitted into evidence, I make the following

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General Findings.

I find Terno Este

on Count I, conspiracy, 11 F.S.M.C. 203, to promote or facilitate theft against the government, guilty;

on Count II, conspiracy, 11 F.S.M.C. 203, to promote or facilitate theft against the government, guilty;

on Count III, conspiracy, 11 F.S.M.C. 203, to promote or facilitate theft against the government, guilty;

on Count IV, conspiracy, 11 F.S.M.C. 203, to promote or facilitate theft against the government, not guilty;

on Count V, conspiracy, 11 F.S.M.C. 203, to promote or facilitate theft against the government, guilty;

on Count VI, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count VII, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count VIII, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count IX, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count X, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XI, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XII, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XIII, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XIV, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XV, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XVI, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XVII, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XVIII, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XIX, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XX, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XXI, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

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on Count XXII, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XXIII, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XXIV, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XXV, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XXVI, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), not guilty;

on Count XXVII, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XXVIII, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty;

on Count XXIX, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty; and

on Count XXX, obligating funds for purposes other than permitted, 55 F.S.M.C. 221(3), guilty.

I find Kimis Moses

on Count I, conspiracy, 11 F.S.M.C. 203, to promote or facilitate theft against the government (11 F.S.M.C. 601),

I find Senso Lorenzo

on Count II, conspiracy, 11 F.S.M.C. 203, to promote or facilitate theft against the government (11 F.S.M.C. 601),

I find Gerhardt Pitiol a/k/a Kerat Pitiol

on Count III, conspiracy, 11 F.S.M.C. 203, to promote or facilitate theft against the government (11 F.S.M.C. 601),

I find Kait Kikku

on Count IV, conspiracy, 11 F.S.M.C. 203, to promote or facilitate theft against the government (11 F.S.M.C. 601), not guilty; and

on Count XXXI, theft against the government, 11 F.S.M.C. 601, guilty as to the $14.40 spent on soft drinks and not guilty as to the rest of the count.

I find Kiak Billy

on Count V, conspiracy, 11 F.S.M.C. 203, to promote or facilitate theft against the government (11 F.S.M.C. 601), guilty; and

on Count XXXII, theft against government, 11 F.S.M.C. 601, guilty.

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The above general findings are based in part upon the following

SPECIAL FINDINGS,

which are made pursuant to Criminal Procedure Rule 23 and are based upon careful consideration of the witnesses' testimony and the exhibits admitted into evidence.

Public Law No. 10-126, § 2(1) appropriated a lump sum of $175,000 to the Southern Namoneas Development Authority "for the purpose of funding health, education, infrastructure and other public projects." Twenty thousand dollars of this was allotted for the "Uman Social Project." The Executive Director of the Southern Namoneas Development Authority was the allottee of the funds. The Financial Management Regulations, effective June 14, 1999, applied to the obligation and disbursement of funds for the Uman Social Project. The Southern Namoneas Development Authority, and its personnel, were subject to, and required to follow, these regulations when obligating and disbursing funds allotted to the Uman Social Project.

The Uman Social Project's purpose was to facilitate the construction of six new community halls on the Island of Uman. Six recipients were chosen, five of whom, Kimis Moses, Senso Lorenzo, Gerhardt Pitiol a/k/a Kerat Pitiol, Kait Kikku, and Kiak Billy, are defendants in this case. The other defendant, Terno Este, was the Southern Namoneas Development Authority's Acting Director, and was thus the allottee of the appropriation from which the funds for the Uman Social Project were drawn, during the time the Uman Social Project funds were obligated and expended and he had the authority to obligate funds.

I conclude that the community halls contemplated by the Uman Social Project project control document are the customary and traditional community hall (an wuut or uut) found in Uman (and throughout the Southern Namoneas and Chuuk Lagoon). I also find that this is the meaning of the term community hall (wuut or uut) as understood by the defendants, who are all from the Southern Namoneas. Not only is this the only logical conclusion to draw under the circumstances, this result is mandated by the Judicial Guidance Clause, FSM Const. art. XI, § 11, which requires all judicial decisions to be consistent with custom and tradition. A community hall or wuut is a free-standing structure with a floor, a roof, and sometimes walls of varying heights. It may be built with traditional materials or sturdier materials, such as cement, may be used. It is not attached to, or a part of, or a room within, any other structure. It is used for community gatherings, meetings, and functions (such as funerals). If the Uman Social Project had intended that the community halls it sought for Uman were to be something other than a community hall as understood by custom and tradition, the project control document would have had to say so.

The Uman Social Project recipients were designated by a January 4, 2000 memorandum from Congress Speaker Jack Fritz to Acting Director Terno Este. Defendants Kimis Moses, Senso Lorenzo, and Kiak Billy were designated as recipients of $4,000 for new community halls; and Kait Kikku and Kerat Pitiol were designated as recipients of $2,000 for the renovation of existing community halls. The use of any of the allotted funds for renovation of existing community halls was in violation of the existing project control document and thus of the financial management regulations and statute, unless the project control document was amended to include renovation. The project control document was never amended.

Under the Uman Social Project project control document, the funds expended were to facilitate the construction of new community halls, not to renovate existing structures. The funds provided were not intended to be sufficient to complete the construction of six new community halls. They were intended to assist the recipients' construction of new community halls. It was expected that the

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recipients, their families, and their community would also assist in the community halls' completion.

Terno Este was Acting Director of the Southern Namoneas Development Authority. He was responsible for seeing that the money allotted was only spent in the manner permitted by the project control document. He was thus responsible for the project recipients compliance, which would include informing them of the permissible uses of the funds and seeing that the completed project was inspected for compliance.

Kimis Moses did not expend any of the money he spent, or use any of the materials he purchased, or services he paid for, on the construction of a new community hall (or even on renovating any existing community hall) on Uman. Moses was aware that the Uman Social Project money was to be spent on building a community hall.

Senso Lorenzo did not spend any of the money he spent, or use any of the materials he purchased, or services he paid for, on the construction of a new community hall on Uman. He spent at least some of the money on repairs to an existing community hall's roof. Other money (over $1,000) was spent on materials (purchased mostly from his wife or other close relative) that were not, and could not by their nature (e.g., sand and aggregate), have been used to repair the roof described by the evidence. These materials were thus not used in either building a new community hall or in renovating the existing community hall. Under both the Uman Social Project project control document (which is legally binding) and Speaker Fritz's Memorandum (which had no legal authority to change the project control document's binding terms, anyway) the funds for which Lorenzo was the recipient were to be used on a new community hall. Lorenzo, even if he did not understand the distinction between building a new community hall and renovating an existing one, was aware that all of the funds were to be spent on a community hall. The funds not connected with the roof repair were not spent on a community hall.

Gerhardt (a/k/a Kerat) Pitiol spent all of the $2,000 for which he was designated the recipient, on renovations to his private home on the Island of Fefan, where he resides – $1,000 to a contractor for work performed, and $1,000 to his wife for materials. He did not spend any of the money on a new community hall or on renovating an existing community hall, or on any structure on the Island of Uman. He knew that the money was to be spent on building a community hall on Uman.

Kait Kikku did not spend any of the money he spent, or use any of the materials he purchased, or services he paid for on the construction of a new community hall on Uman, or on renovating an existing community hall on Uman. He had asked, on December 20, 1999, Speaker Jack Fritz for help in fixing his private home on Uman. Speaker Fritz gave him a letter to take to a certain store, which said that Kikku was authorized for up to $2,000 of construction materials for a project. On December 21, 1999, Kikku charged $2,000.07 at that store for construction materials, but which sum also included $14.40 for a case of soft drinks. This all took place before the Southern Namoneas Development Authority had been notified of the recipients' identity and before the advice of allotment had been issued and before any involvement with Este (or the Southern Namoneas Development Authority) concerning the matter. It is not lawful, except for certain exceptions which do not apply here, for project money to be obligated or expended before the advice of allotment has been issued. The vendor was eventually paid $1,999.60. The store's first invoice was rejected by the Southern Namoneas Development Authority because of the early date and the presence of the soft drinks. The Southern Namoneas Development Authority paid a second (false) I nvoice for $1,999.60 with a new date and no soft drinks listed. In this way, Kikku's construction materials and soft drinks were paid for by Uman Social Project funds.

Kiak Billy did not expend any of the money he spent, or use any of the materials he purchased,

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or services he paid for on the construction of a new community hall or on the renovation of an existing community hall on Uman. Billy was aware that the Uman Social Project money was to be spent on building a community hall on Uman.

The first five counts charge five different conspiracies, each with Terno Este as one of the conspirators and one of the other defendants as the only other co-conspirator.

A person commits the offense of conspiracy, if, with intent to promote or facilitate the commission of a National offense:

(a) he agrees with one or more persons that they, or one or more of them, will engage in or solicit the conduct or will cause or solicit the result specified by the definition of the offense; and

(b) he or another person with whom he conspired commits an overt act in pursuance of the conspiracy.

11 F.S.M.C. 203(1). The agreement does not have to be explicit. "A mere tacit understanding will suffice, and there need not be any written statement or even a speaking of words which expressly communicates the agreement." 2 Wayne R. LaFave & Austin W. Scott, Substantive Criminal Law § 6.4(d), at 71 (1986). A conspiracy exists when either the agreement or the means contemplated for its achievement are unlawful. 16 Am. Jur. 2d Conspiracy § 2, at 218-19 (1979). It was unlawful and a national offense for any of the Uman Social Project funds to be spent on anything other than the construction of six new community halls on Uman. An agreement to do so would thus constitute the national offense of conspiracy. A single overt act committed by one of the co-conspirators before the end of the conspiracy is sufficient for there to be criminal liability for conspiracy. Id. §15, at 230-31.

"[C]onspiracy to commit a crime is an offense separate and distinct from the crime that is the object of the conspiracy." Id. § 5. "It is not necessary . . . to prove the specific terms or the specific scope of the conspiratorial agreement or to prove that the substantive object of the conspiracy was accomplished." Id. § 40, at 253 (footnote omitted). "The existence of, and participation in, a criminal conspiracy may be proved by circumstantial as well as by direct evidence, if it affords a reasonable inference as to the ultimate facts sought to be proved . . . ." Id. § 42, at 256 (footnotes omitted). "There must be evidence of some participation or interest in the commission of the offense . . . ." Id.

The trial court is allowed great discretion in the reception of circumstantial evidence, for a conspiracy must be proved by a number of indefinite acts, conditions, and circumstances varying with the purpose to be accomplished. Where it is shown that the defendants by their acts pursued the same object, one performing one part and the other performing another part so as to complete it or with a view to its attainment, the [trier of fact] will be justified in concluding that they were engaged in a conspiracy to effect that object.

Id. § 42, at 257 (footnotes omitted). "Most conspiracy convictions are based on circumstantial evidence." LaFave & Scott, supra, § 6.4(b)(4), at 66.

Terno Este was aware that the recipients were not using or going to use the Uman Social Project funds for the purpose prescribed in the Uman Social Project project control document. He had separate agreements, tacit or otherwise, with Kimis Moses, Senso Lorenzo, Gerhardt Pitiol a/k/a Kerat Pitiol, and Kiak Billy to promote or facilitate the unlawful use of the Uman Social Project funds for purposes other than that prescribed in the project control document. Este committed numerous overt acts in furtherance of these agreements in

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his capacity as Acting Director of the Southern Namoneas Development Authority.

The government has not proven beyond a reasonable doubt that Kait Kikku had the requisite knowledge or mental state to be convicted of a conspiracy with Terno Este (the only person he is charged with conspiring with) since any agreement he made was with Speaker Fritz (and his acquisition of materials) before any possible involvement with Este. He is therefore acquitted of the conspiracy charge against him. Since Kikku is acquitted on Count IV, the only other person, Este, charged or accused of being a part of that separate and discreet conspiracy must also be acquitted. "A finding by the court that there is insufficient evidence to convict all but one of the parties alleged to have participated in a conspiracy ordinarily requires the discharge of the one remaining defendant." 16 Am. Jur. 2d Conspiracy § 26, at 241 (1979).

The government has, likewise, has not proven beyond a reasonable doubt the charge against Kikku of theft against the government (Count XXXI) for the construction materials he obtained as a result of Speaker Fritz's letter, but has proven theft for the funds obligated (and later paid) for the soft drinks ) $14.40. Kikku knew these funds could not be used for that purpose.