FSM SUPREME COURT TRIAL DIVISION
Cite as David v. FSM Dep't of Health & Soc. Affairs 24 FSM R. 224 (Pon. 2023)
ANSILY DAVID, BERBOLEEN DAMIAN, CATHY-LOU
REKAS, CLARA ANDON, MARCY LORRIN,
MARLEL-LYN SOSWA, MERLINA EDWARD,
SCARLETT LEBEHN, and YVONNE LEBEHN,
Plaintiffs,
vs.
DEPARTMENT OF HEALTH AND SOCIAL AFFAIRS
of the Government of the Federated States of
Micronesia and the FEDERATED STATES OF
MICRONESIA,
Defendants.
CIVIL ACTION NO. 2022-032
ORDER TO ENTER DEFAULT JUDGMENT
Larry Wentworth
Associate Justice
Hearing: July 24, 27, 2023
Decided: August 9, 2023
APPEARANCES:
For the Plaintiffs:
Salomon M. Saimon, Esq.
P.O. Box 911
Kolonia, Pohnpei FM 96941
For the Defendants:
Jeffrey S. Tilfas, Esq.
Assistant Attorney General
FSM Department of Justice
P.O. Box PS-105
Palikir, Pohnpei FM 96941
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Under Civil Procedure Rule 55(e), no default judgment can be entered against the FSM or an officer or agency thereof unless the claimant establishes his or her claim or right to relief by evidence satisfactory to the court. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 228 (Pon. 2023).
A default judgment cannot be entered against the FSM or against the FSM Department of Health and Social Affairs until the plaintiffs established their claims or rights to relief by evidence satisfactory to the court. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 228 (Pon. 2023).
Rule 55(e) does not bar default judgments against the FSM in all circumstances, it only bars them when the claimant has not established his or her claim by satisfactory evidence. The satisfactory or substantial evidence needed under Rule 55(e) does not have to rise to the same level needed in other cases against the FSM because, after an entry of default against the FSM government, the quantum and quality of evidence that might satisfy a court can be less than that normally required. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 228 (Pon. 2023).
Plaintiffs are required to prove damages before a default judgment can be entered against the FSM or an FSM agency, even though the FSM defendants have defaulted. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 228 (Pon. 2023).
A default judgment cannot be different in kind from or exceed in amount that prayed for in the demand for judgment. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 228 (Pon. 2023).
A default judgment that awards relief that is either more than or different in kind from that originally requested is null and void. Such a default judgment is not only void but also subject to collateral attack, and serious due process questions would be raised. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 228 (Pon. 2023).
Since Rule 54(c)'s clear command is that a default judgment cannot be different in kind from or exceed in amount that prayed for, and since the plaintiffs prayed for $92,240.78 in damages for unpaid overtime, the default judgment cannot exceed that amount, and when a further claim for standby pay appears to be different in kind to the claim for overtime pay, and it cannot be added to the judgment. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 228 (Pon. 2023).
In a case decided on the merits, every final judgment will grant the relief to which the party in whose favor it is rendered is entitled, even if the party has not demanded such relief in the party's pleadings. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 228 n.1 (Pon. 2023).
When the defendants have defaulted and the plaintiffs wish to seek a judgment for more than they prayed for in the complaint, they may do so in either of two ways: 1) since the defendants have not filed and served a responsive pleading (an answer), the plaintiffs could file (preferably, before the default was entered), as a matter of course, an amended complaint with their new allegations about the amounts owed, and serve that amended complaint and a summons on the defendants; or, 2) since the defendants have filed neither an answer nor a summary judgment motion, the plaintiffs could unilaterally dismiss their original complaint, and then file, and serve with a summons, a new complaint (a new case) with the new amount allegations. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 229 (Pon. 2023).
An amended complaint and summons or a new case with a complaint and summons would make an earlier entry of default a nullity, and the defendants would then be able to not only plead an answer but to also conduct discovery, which would lengthen the time before the plaintiffs could obtain a money judgment. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 229 (Pon. 2023).
Although FSM's notice pleading standard relies on liberal discovery rules and summary judgment motions to define disputed facts and issues and to dispose of non-meritorious claims, these procedures are neither available nor utilized in obtaining a default judgment when the defendant has never appeared. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 229 n.2 (Pon. 2023).
Under the civil rights statute, the court may award costs and reasonable attorney's fees to the prevailing parties. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 229 (Pon. 2023).
In evaluating a motion for a default judgment, the court accepts as true all well-pled facts in the complaint but must reach its own legal conclusions. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 229 (Pon. 2023).
While the factual allegations in a complaint, except those as to damages, are treated as conceded by the defendant for purposes of a default judgment, the legal issues remain subject to the court's adjudication. Even after default, it remains for the court to consider whether the unchallenged facts constitute a legitimate cause of action, since a party in default does not admit mere conclusions of law. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 229-30 (Pon. 2023).
A government's breach of contract, without more, does not constitute a due process or civil rights claim. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 230 (Pon. 2023).
For a plaintiff to support an involuntary servitude claim, the plaintiff must at least show that he or she was compelled or forced against his or her will to provide services for the defendants' benefit because involuntary servitude is the condition of one who is compelled by force, coercion, or imprisonment, and against his or her will, to labor for another, whether he or she is paid or not. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 230 (Pon. 2023).
Plaintiffs do not state a claim for involuntary servitude when they voluntarily entered into their special services contracts and could have quit at any time, even while lodged in a quarantine facility, although they would not have been allowed to leave the quarantine site immediately due to public health reasons, not employment reasons. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 230 (Pon. 2023).
Plaintiffs cannot be awarded their attorney's fees and costs under the civil rights statute when they do not have any civil rights cause of action. Nor when the plaintiffs' special services contracts do not authorize attorney's fees to the prevailing party. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 230 (Pon. 2023).
The court can award attorney's fees to the prevailing party only if authorized by contract or by statute. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 230 (Pon. 2023).
Prevailing parties are usually allowed their costs as a matter of course, but costs cannot be imposed against the FSM or its agencies unless expressly permitted by law. David v. FSM Dep't of Health & Soc. Affairs, 24 FSM R. 224, 230 (Pon. 2023).
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LARRY WENTWORTH, Associate Justice:
Since the defendants had defaulted, this came before the court for a damages hearing. Based on the evidence adduced during the hearing and the rules governing default judgments, the court hereby orders that a default judgment be entered in the plaintiffs' favor for a total of $92,240.78. The reasons follow.
The nine plaintiffs were, in August 2021, all hired by the FSM national government on one-year special services contracts to work a regular 40-hour work week as "covid assistants." Their work was to be done as part of the Pohnpei state public health and covid task force. They were paid by the national government. The 40-hour work week could vary depending on the government's needs.
Starting with repatriation flight #10 in August 2021, when repatriation flights came in, some plaintiffs would be lodged along with the arriving passengers in a Pohnpei quarantine facility, to provide services such as meal delivery, cleaning, and covid swab testing, and could not leave the quarantine site until the quarantine period was over and they had been cleared for release. This required more than eight hours a day of work and also required work on all seven days of the week (not the regular five-day work week) at the quarantine site because quarantine periods ranged from seven to fourteen days, although times when a quarantined returnee tested covid-positive, some covid assistants would remain longer in the quarantine site until negative covid tests allowed the last person to be released. During the quarantine of repatriated passengers, it was impossible for any plaintiff stationed at a quarantine site to work only eight hours a day or only five days a week.
Although the plaintiffs contracted with, and were paid by, the national government, they worked as part of a Pohnpei state government operation. The FSM had similar arrangements with Yap and Chuuk. (Kosrae did not join this program.) The national government does not generally pay overtime for hours in excess of 40 hours a week, although the state governments, including Pohnpei, usually do. Instead, the FSM usually gives compensation time. Compensation time was not feasible for the covid quarantine workers, especially since they performed their duties as a part of a team of Pohnpei state employees who entered quarantine to assist the repatriated arriving passengers.
After covid quarantining ended and the FSM reopened, the national government paid overtime to the Chuuk and Yap covid workers, who were (similar to the plaintiffs) FSM contractual employees, based on how their overtime pay would have been calculated under the applicable state law if they had been state employees. The FSM national government was willing and able to pay the Pohnpei covid assistants as well. But there was difficulty in assembling the records needed to calculate overtime for the FSM covid assistants for Pohnpei. At first, figures were presented that would have set their combined overtime pay in the $20,000+ range and then at about $54,000. The FSM was willing to pay that.
Based on further employment records, the nine plaintiffs then calculated their combined claims to total $92,240.78. They filed suit against the FSM Department of Health and Social Affairs and the FSM, on November 29, 2022, alleging breach of contract, involuntary servitude, due process violations, and general civil rights violations. They sought $92,240.78 in damages plus their attorney's fees and costs. The defendants did not file an answer but tried instead to settle and pay the plaintiffs. A disagreement arose over the proper amount. The plaintiffs then requested an entry of default.
The clerk entered the defendants' default on May 23, 2023. On July 24, and 27, 2023, the court held a hearing for the plaintiffs to present evidence of their damages. FSM Civ. R. 55(b)(2) (court may conduct hearing to determine damages in default judgment). A hearing was needed because, under Civil Procedure Rule 55(e), "[n]o judgment by default shall be entered against the Federated States of Micronesia or an officer or agency thereof unless the claimant establishes his claim or right to relief by evidence satisfactory to the court." Thus, a default judgment could not be entered against the FSM or against the FSM Department of Health and Social Affairs until the plaintiffs established their claims or rights to relief by evidence satisfactory to the court. Lee v. FSM, 18 FSM R. 558, 561 (Pon. 2013).
Rule 55(e) does not bar default judgments against the FSM in all circumstances, it only bars them when the claimant has not established his or her claim by satisfactory evidence. Lee, 18 FSM R. at 561. The satisfactory or substantial evidence needed under Rule 55(e) does not have to rise to the same level needed in other cases against the FSM because, after an entry of default against the FSM government, the quantum and quality of evidence that might satisfy a court can be less than that normally required. Lee, 18 FSM R. at 561. Nevertheless, the plaintiffs are still required to prove damages before a default judgment can be entered against the FSM or an FSM agency, even though the defendants have defaulted. Lee v. FSM, 19 FSM R. 80, 82-83 (Pon. 2013).
In their complaint, the plaintiffs seek damages for unpaid overtime hours while staying in the Pohnpei quarantine sites tending to the quarantined, repatriated passengers. During the damages hearing, the plaintiffs presented evidence that tended to show that they were entitled to pay for overtime (when working while stationed at a quarantine site) and also for standby time (when not actually working while stationed at a quarantine site 24 hours a day), in a cumulative amount of $132,812.71. Pls.' Ex. 4 (an extract summary of extensive electronic time card (ingress system) records in Pls.' Ex. 3).
However, "[a] judgment by default shall not be different in kind from or exceed in amount that prayed for in the demand for judgment." FSM Civ. R. 54(c). Because a default judgment cannot be different in kind from or exceed in amount that prayed for, Pohnpei v. M/V Ping Da 7, 20 FSM R. 75, 78, 80 (Pon. 2015); Lee, 18 FSM R. at 561; Western Sales Trading Co. v. Billy, 13 FSM R. 273, 277 (Chk. 2005), a default judgment that awards relief that is either more than or different in kind from that originally requested is null and void. FSM Dev. Bank v. Ehsa, 20 FSM R. 286, 292 (Pon. 2016). Such a default judgment would not only be void but also subject to collateral attack, and serious due process questions would be raised. Western Sales, 13 FSM R. at 277.
Since Civil Procedure Rule 54(c)'s clear command is that a default judgment cannot be different in kind from or exceed in amount that prayed for, Western Sales, 13 FSM R. at 277-78,1 and since the plaintiffs prayed for $92,240.78 in damages for unpaid overtime, the default judgment cannot exceed that amount. FSM Civ. R. 54(c). Furthermore, the claim for standby pay (which accounts for most of the increase) appears to be different in kind to the claim for overtime pay, and therefore cannot be added to the judgment. Id.; Western Sales, 13 FSM R. at 278.
The $92,240.78 is allocated as follows:
Ansily David (1,351.87 hours).................................................................................................................................................................................................................................................................$13,451.10
Berboleen Damian (1,028.05 hours).......................................................................................................................................................................................................................................................$10,229.09
Cathy-Lou Rekas (1,355.4 hours)...........................................................................................................................................................................................................................................................$13,486.23
Clara Andon (1,195.54 hours)...................................................................................................................................................................................................................................................................$8,966.55
Marcy Lorrin (500 hours)...........................................................................................................................................................................................................................................................................$7,229.67
Marlel-Lyn Soswa (902.13 hours)..............................................................................................................................................................................................................................................................$8,976.20
Merlina Edward (1,128.4 hours)................................................................................................................................................................................................................................................................$8,463.00
Scarlett Lebehn (509.7 hours)...................................................................................................................................................................................................................................................................$5,071.51
Yvonne Lebehn (1,644.96 hours)............................................................................................................................................................................................................................................................$16,367.35
The clerk shall therefore enter judgment for each plaintiff in the above amounts.
The plaintiffs could have sought a judgment for more than $92,240.78 in either of two ways. Since the defendants had not filed and served a responsive pleading (an answer), the plaintiffs could have (preferably, before the default was entered), "as a matter of course," filed an amended complaint with their new allegations about the amounts owed, FSM Civ. R. 15(a), and served that amended complaint and a summons on the defendants. Or, since the defendants had filed neither an answer nor a summary judgment motion, the plaintiffs could have unilaterally dismissed their original complaint, FSM Civ. R. 41(a)(1)(i), and then filed, and served with a summons, a new complaint (a new case) with the new amount allegations. They did neither.
If the plaintiffs had taken either one of these two routes, the May 22, 2023 entry of default would have become a nullity. The defendants then would have been able to not only plead an answer but to also conduct discovery,2 which would have lengthened the time before the plaintiffs could obtain a money judgment. That may have been why the plaintiffs did not choose to take either route.
The plaintiff's complaint also prayed for an award for their attorney's fees and costs. This prayer for relief was premised on their allegation and legal conclusion that this is a civil rights case and that therefore, under the civil rights statute, 11 F.S.M.C. 701(3), the court would "award costs and reasonable attorney's fees to [them as] the prevailing part[ies]."
A. Evaluation of a Motion for a Default Judgment
In evaluating a motion for a default judgment, the court accepts as true all well-pled facts in the complaint but must reach its own legal conclusions. Onanu Municipality v. Elimo, 20 FSM R. 535, 541 (Chk. 2016); cf. Solomon v. FSM, 20 FSM R. 396, 403 (Pon. 2016) (same standard applies to Rule 12(b)(6) motions – court does not assume truth of complaint's legal conclusions even if cast as factual allegations); Arthur v. Pohnpei, 16 FSM R. 581, 593 (Pon. 2009) (same).
While the factual allegations in a complaint, except those as to damages, are treated as conceded by the defendant for purposes of a default judgment, legal issues remain subject to the court's adjudication. Even after default, however, it remains for the court to consider whether the unchallenged facts constitute a legitimate cause of action, since a party in default does not admit mere conclusions of law.
Onanu Municipality, 20 FSM R. at 541 (internal quotation marks omitted) (citations omitted). The court must therefore determine whether the plaintiffs' factual allegations constitute a civil rights cause of action.
B. Whether Claims Are Civil Rights Causes of Action
The plaintiffs pled breach of contract because they were not paid overtime (supposedly state law about overtime for state employees was an implied contract term because plaintiffs were, at all times, part of a team of state employees operating solely under state direction). The plaintiffs also pled due process taking of their property (their overtime pay). It is well established that a government's breach of contract, without more, does not constitute a due process or civil rights claim. Sonden v. Pohnpei, 22 FSM R. 465, 467 (Pon. 2020) (breach of contract claim does not involve the deprivation of preexisting property or the deprivation of statutorily vested property rights); Linter v. FSM, 20 FSM R. 553, 558 (Pon. 2016); Stephen v. Chuuk, 18 FSM R. 22, 25 (Chk. 2011); FSM v. GMP Hawaii, Inc., 16 FSM R. 479, 484 (Pon. 2009); Barrett v. Chuuk, 12 FSM R. 558, 561 (Chk. 2004); Island Dev. Co. v. Yap, 9 FSM R. 18, 20 (Yap 1999); See also FSM Telecomm. Cable Corp. v. FSM Telecomm. Corp., 23 FSM R. 667, 683 (Pon. 2022) (when the government itself breaches a contract, a party must seek compensation from the government in contract rather than under a takings claim).
Nor do the factual allegations constitute an involuntary servitude cause of action. For a plaintiff to support an involuntary servitude claim, the plaintiff must at least show that he or she was compelled or forced against his or her will to provide services for the defendants' benefit. Santos v. FSM, 23 FSM R. 117, 125 (Pon. 2021). Involuntary servitude is "[t]he condition of one who is compelled by force, coercion, or imprisonment, and against his [or her] will, to labor for another, whether he [or she] is paid or not." BLACK'S LAW DICTIONARY 743 (5th ed. 1979). The plaintiffs' factual allegations in their complaint do not come close to this standard. The plaintiffs voluntarily entered into their special services contracts. They could have quit at any time, even while lodged in a Pohnpei quarantine facility, although they would not have been allowed to leave the quarantine site immediately due to public health reasons, not employment reasons. The plaintiffs do not state a claim for involuntary servitude.
The plaintiffs, in their general civil rights cause of action, allege that their rights "guaranteed under Article IV, Section 10 of the FSM Constitution" were violated. Compl. para. 25. Since Section 10 prohibits slavery and involuntary servitude, this cause of action also, as just explained, fails to state a civil rights claim as a matter of law.
C. Whether Fees and Costs Can Be Awarded
Therefore, as a matter of law, the plaintiffs cannot be awarded their attorney's fees and costs under the civil rights statute because they do not have any civil rights cause of action. Nor do the plaintiffs' special services contracts authorize attorney's fees to the prevailing party in any lawsuit to enforce the special services contracts. Since the court can award attorney's fees to the prevailing party only if authorized by contract or by statute, FSM Dev. Bank v. Adams, 14 FSM R. 234, 256 (App. 2006), the plaintiffs are not entitled to an attorney's fee award.
Prevailing parties are usually allowed their costs as a matter of course. Pacific Islands Dev. Bank v. Sigrah, 23 FSM R. 79, 85 (Pon. 2020). However, costs generally cannot be imposed against the FSM or its agencies. FSM Civ. R. 54(d) ("costs against the Federated States of Micronesia, its officers, and agencies shall be imposed only to the extent permitted by law"). Since it is not expressly permitted by law, the court cannot award the plaintiffs their costs against either the FSM or its agency, the FSM Department of Health and Social Affairs.
Accordingly, the clerk shall enter a money judgment for the plaintiffs in conformity with this order. No attorney's fees or costs will be awarded.
_______________________________Footnotes:
1 This is in contrast to a case decided on the merits where every final judgment will grant the relief to which the party in whose favor it is rendered is entitled, even if the party has not demanded such relief in the party's pleadings. FSM Civ. R. 54(c).
2 Although FSM's notice pleading standard relies on liberal discovery rules and summary judgment motions to define disputed facts and issues and to dispose of non-meritorious claims, these procedures are neither available nor utilized in obtaining a default judgment when the defendant has never appeared. Western Sales Trading Co. v. Billy, 13 FSM R. 273, 277 (Chk. 2005).
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