FSM SUPREME COURT TRIAL DIVISION

Cite as American Trading Intíl, Inc. v. Helgenberger, 15 FSM Intrm. 50 (Pon. 2007)

[15 FSM Intrm. 50]

AMERICAN TRADING INTERNATIONAL, INC.,

Plaintiff,

vs.

BELLARMINE HELGENBERGER, individually and

dba Bernardís Enterprises, and as Administrator of

the Estate of Bernard Helgenberger,

Defendant.

CIVIL ACTION NO. 2007-001

ORDER GRANTING PLAINTIFFíS MOTION FOR SUMMARY JUDGMENT

Andon L. Amaraich

Chief Justice

Decided: May 31, 2007

APPEARANCE:

For the Plaintiff:   Michael J. Sipos, Esq.

                            Sipos & Berman

                            P.O. Box 2069

                            Kolonia, Pohnpei   FM   96941

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HEADNOTES

Constitutional Law ) Case or Dispute ) Standing

      When the debt the defendant owes the plaintiff was assigned by the plaintiff to its credit insurer and thereafter the insurer paid $48,554.11 to the plaintiff pursuant to its insurance arrangement and then made attempts to collect the outstanding debt from the defendant but its collection efforts were unsuccessful and when the plaintiff then procured a reassignment of the debt from its insurer and agreed to reimburse the insurer first and in full from any recovery, net of reasonable attorneyís fees incurred in the plaintiffís recovery attempts, the plaintiff, as a result of the reassignment, is the proper party in interest and has standing to bring the action to recover the debt from the defendant. American Trading Intíl, Inc. v. Helgenberger, 15 FSM Intrm. 50, 51-52 (Pon. 2007).

Civil Procedure ) Summary Judgment

      When an adverse party fails to respond to a pending summary judgment motion, the partyís failure to respond constitutes a consent to the granting of the motion, but does not automatically result in a granting of the motion. There still must exist a good basis in law and in fact upon which to grant the motion. American Trading Intíl, Inc. v. Helgenberger, 15 FSM Intrm. 50, 52 (Pon. 2007).

Civil Procedure ) Summary Judgment

      In determining whether summary judgment is appropriate, the court must view the facts

[15 FSM Intrm 51]

presented and inferences made in the light most favorable to the non-moving party. The burden of showing a lack of triable issues of fact rests with the moving party. Once the moving party has satisfied its burden, the non-moving party, in order to avoid summary judgment, must produce evidence showing that a genuine issue of material fact exists. To satisfy its burden, the non-moving party may not rely on unsubstantiated denials of liability but must present competent evidence, that would be admissible at trial and that shows there is a genuine issue of material fact. American Trading Intíl, Inc. v. Helgenberger, 15 FSM Intrm. 50, 52 (Pon. 2007).

Civil Procedure ) Summary Judgment

       Unauthenticated exhibits to unverified complaints do not normally constitute admissible evidence. However, when the defendantís answer admits that the exhibits to the complaint represent true and correct copies of the invoices signed by him, in light of defendantís authenticating admission, the invoices attached to the unverified complaint constitute competent, admissible evidence that is properly considered by the court on a summary judgment motion. American Trading Intíl, Inc. v. Helgenberger, 15 FSM Intrm. 50, 52 n.2 (Pon. 2007).

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COURTíS OPINION

ANDON L. AMARAICH, Chief Justice:

      By motion filed March 5, 2007 and supplemented on March 22, 2007, plaintiff requests that the Court grant summary judgment against defendant on its first two causes of action, breach of contract and account stated. Defendant has not filed a response.  For the reasons set forth below, the Court grants plaintiffís motion.

A.  Facts.

      Between October 18, 2004 and December 17, 2004, defendant ordered various goods from plaintiff.  Plaintiff sold and delivered these good to defendant in four shipments.  Defendant failed to pay for the goods ordered and delivered.  The invoices attached as exhibits to the complaint set forth the originally invoiced prices for the goods, as well as the total principal and interest owing by defendant as of December 15, 2006, which totaled $216,045.78.

       At some point in 2005, the debt owing by defendant to plaintiff was assigned by plaintiff to its credit insurer, Export-Import Bank of the United States ("Ex-Im Bank"). Thereafter, Ex-Im Bank made a payment of $48,554.11 to plaintiff pursuant to its insurance arrangement with plaintiff. Ex-Im Bank then made attempts to collect the outstanding debt from defendant. Once and if the debt were collected by Ex-Im Bank, Ex-Im Bank would pay the remainder of the outstanding debt to plaintiff, net of the insurance payment to plaintiff. Ex-Im Bankís collection efforts turned out to be unsuccessful.

      Plaintiff then procured a reassignment of the debt from Ex-Im Bank. As part of the reassignment arrangement, plaintiff agreed to reimburse Ex-Im Bank first and in full from any recovery from defendant, net of reasonable attorneys fees plaintiff incurs in its attempts to recover the debt. Thus, plaintiff will not enjoy a double recovery in the event it collects the debt from defendant. As a result

[15 FSM Intrm 52]

of the reassignment from Ex-Im Bank, plaintiff is the proper party in interest and has standing to bring this action to recover the debt from defendant.

B.  Applicable Legal Standards.

      Under FSM Civ. R. 56(c), the Court must grant the relief sought by summary judgment "if the pleadings, . . . together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Furthermore, where a party fails to respond to a pending motion, under Civil Procedure Rule 6(d) the partyís failure to respond "shall constitute a consent to the granting of the motion." However, a partyís failure to respond does not automatically result in a granting of the motion. There still must exist a good basis in law and in fact upon which to grant the motion. Joe v. Kosrae, 13 FSM Intrm. 45, 47 (Kos. 2004). Moreover, FSM Civ. R. 56(e) states, "If the adverse party does not so respond, summary judgment, if appropriate, shall be entered against the adverse party."

      In determining whether summary judgment is appropriate, the Court must view the facts presented and inferences made in the light most favorable to the non-moving party. Lee v. Lee, 13 FSM Intrm. 68, 70 (Chk. 2004). The burden of showing a lack of triable issues of fact rests with the moving party. Id. Once the moving party has satisfied this burden, in order to avoid summary judgment the non-moving party must produce evidence showing that a genuine issue of material fact exists. Ambros & Co. v. Board of Trustees, 12 FSM Intrm. 206, 212 (Pon. 2003). To satisfy this burden, the non-moving party may not rely on unsubstantiated denials of liability. The non-moving party must present competent evidence, that would be admissible at trial and that shows there is a genuine issue of material fact. Id.

C.  Analysis.

       Plaintiffís complaint contains causes of action for breach of contract, account stated, and fraud. Plaintiffís motion seeks summary judgment on the causes of action for breach of contract and account stated.

      Most of the undisputed material facts at issue in the present case are established by the admissions of defendant. For example, defendantís answer admitted that defendant ordered goods from plaintiff, which plaintiff sold and delivered to defendant in four shipments between October 18, 2004 and December 17, 2004. Likewise, defendantís answer admitted that the invoices attached as exhibits to the complaint correctly set forth the total principal and interest owing by defendant as of December 15, 2006 in the amount of $216,045.78.

      In support of the amount owing on the debt, plaintiff also submitted the affidavit of Seth Wilen, president of plaintiff, who stated at paragraph 7 that "To date, no portion of the debt involved here has been paid by the defendant and the entire amount at issue in the pending lawsuit remains outstanding." Mr. Wilenís testimony, taken together with defendantís admissions and the invoices attached to the unverified complaint satisfy plaintiffís burden to show there are no genuine issues of material fact regarding the existence and amount of the outstanding debt.

[15 FSM Intrm 53]

       Under the rule set forth in Ambros & Co. v. Board of Trustees, 12 FSM Intrm. 206, 212 (Pon. 2003), defendant cannot rely on his unsubstantiated denial of liability in his unverified answer. In order to avoid summary judgment, defendant must present some competent evidence that would be admissible at trial and that shows there is a genuine issue of material fact. Defendant, who failed to file a response to plaintiffís motion, has not done this. Accordingly, plaintiff is entitled to summary judgment in the amount of $231,894.03, which consists of $216,045.78 in outstanding principal and interest as of December 15, 2006, plus interest at $96.05 per diem from December 15, 2006 through the date of this Order, for a total of $15,848.25. The Clerk is ordered to enter judgment forthwith in the amount of $231,894.03, with post-judgment interest to accrue at 9% per annum.

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Footnotes:

1.  Paragraph 9 of defendantís answer admits that the exhibits attached to the unverified complaint are "True and correct copies of the relevant purchase invoices bearing defendantís signature together with the bills of lading and payment invoices updated through December 15, 2006 . . . ."

2.  Unauthenticated exhibits to unverified complaints do not normally constitute admissible evidence. In this case, however, defendantís answer admits that the exhibits to the complaint represent true and correct copies of the invoices signed by him. In light of defendantís authenticating admission, the invoices attached to the unverified complaint constitute competent, admissible evidence that is properly considered by the Court on this motion for summary judgment.

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