Cite as Palik v. Kosrae,
5 FSM Intrm. 147 (Kos. St. Ct. Tr. 1991)

[5 FSM Intrm. 147]





Harry H. Skilling
Justice Pro Tempore
Kosrae State Court
August 13, 1991

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[5 FSM Intrm. 148]

For the Plaintiff:          Delson Ehmes
                                     Directing Attorney
                                     Micronesian Legal Services Corporation
                                      Tofol, Kosrae  96944

For the Defendant:     Glenn Jewel
                                     Assistant Attorney General
                                     Tofol, Kosrae  96944

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Constitutional Law - Due Process; Property - Public Lands
     Plaintiff's due process rights were not violated where the government did not use condemnation procedures specified in 67 TTC 451, but followed land registration procedures to obtain title and treated the plaintiff fairly and in the same way it treated other landowners.  Palik v. Kosrae, 5 FSM Intrm. 147,152-54 (Kos. S. Ct. Tr. 1991).

Property - Easements
     In order for the state to acquire an easement by prescription, the state's use must be open, notorious, hostile, and continuous for the statutory period under a claim of right.  Palik v. Kosrae, 5 FSM Intrm. 147, 154 (Kos. S. Ct. Tr. 1991).

Equity - Laches
     Laches is a tool courts use to limit a party's rights when they have not been timely asserted, such that it is unfair for the court to now redress them.  The period of time may be less than the statutory limitations period and each case must be judged on a case by case basis for fundamental fairness.  Palik v. Kosrae, 5 FSM Intrm. 147, 155 (Kos. S. Ct. Tr. 1991).

Equity; Property - Easements
     Encroachment of a road on adjacent parcels is a trespass when the state has not used the property without interruption for the statutory period, nor for a period of time that would make the assertion of plaintiff's rights unfair.  Palik v. Kosrae, 5 FSM Intrm. 147, 156 (Kos. S. Ct. Tr. 1991).

Property - Easements
     Utility poles do not constitute trespass on land when the owner consented to their placement, accepted compensation for crop damage, and signed an agreement which effectively granted an easement for placement of utility poles.  Palik v. Kosrae, 5 FSM Intrm. 147, 155-56 (Kos. S. Ct. Tr. 1991).
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[5 FSM Intrm. 149]

HARRY H. SKILLING, Justice Pro Tempore:

     This matter came before me for trial on Tuesday, August 13, 1991 on the issue of defendant's liability.  Present during the trial were counsel for plaintiff, Delson Ehmes, MLSC Kosrae Office, and Glenn Jewel, Assistant Attorney General, Kosrae.  The matter was taken under advisement, and this opinion is issued on the question of defendant's liability, the damages portion having been bifurcated pursuant to the stipulation of the parties.

     Plaintiff claims that she has been damaged by defendant's activities in obtaining title to and use of certain properties in Lelu Municipality, and citing the following causes of action:

             1.  Trespass

             2.  Cloud on Title

             3.  Taking of Property without Due Process

             4.  Violation of 67 TTC, Chapter 9

             5.  Violation of Trusteeship Agreement, Article 6(2)

     Defendant Kosrae State, in its answer to the complaint alleged the following affirmative defenses:

             1.  Statute of Limitations

             2.  Waiver, Laches, and Estoppel

             3.  Sovereign Immunity

             4.  Failure to State Cause of Action Against Commission
             5.  Title in State by Prescriptive Easement

     [1]  The properties involved in this action are known as Pukusrik Te and Insiaf. Both properties are located in Lelu Municipality, Kosrae State.  Prior to 1971, the properties were owned and controlled by Musrasrik Tinteru, plaintiff's father.

[5 FSM Intrm. 150]

     [2]  In 1975, a notice of hearing (formal) was posted at the municipal office by the Land Commission, and on the property involved.  Notice of hearing was served upon the two surviving siblings of Musrasrik, Diana and Tarzan.  Notices were served upon Diana on August 11, 1975.

     [3]  The Land Commission designated portions of Pukusrik Te as Parcel Nos. 031-K-02 and 032-K-02 (hereinafter "road parcels") and determined title in favor of the Trust Territory government after a formal hearing.  Plaintiff was not present at the hearing.  The road parcels have been continuously used as a road by Trust Territory and State Governments.  After the determination of ownership was issued, neither the plaintiff nor the surviving siblings of Musrasrik Tinteru filed an appeal.

     [4]  Title to the remainder of Pukusrik Te and Insiaf was determined in favor of the heirs of Musrasrik.  These parcels abut the road parcels (hereinafter "adjacent parcels).

     [5]  On May 12, 1984, the Trust Territory Government and plaintiff's husband entered into an agreement (Def. Ex. 10) whereby plaintiff would permit the placement of power poles on the adjacent parcels, and defendant would pay an agreed amount of money for crop damages.  The amount of one hundred dollars was paid to cover a number of coconut trees at an agreed amount of $25.00 per tree.

     [6]  In the period between 1975 and present, the road constructed over the road parcels has wandered from the boundaries of the road parcels, resulting in an encroachment upon the adjacent parcels.  The road parcels have been continuously used by the general public for over a period of fourteen years, and plaintiffs at all times had notice of such use, and took no legal action against either the previous or the present administration until the filing of this action by plaintiff.  The boundary of the road varies with each grading of the road.
     [7]  On June 1, 1978, Land Commission issued a Certificate of Title on Parcel No. 032-K-02 in favor of Trust Territory Government [Def. Ex. 7], and on December 1, 1978, certificate of title on parcel no. 031-K-02 was issued in favor of the Trust Territory Government [Def. Ex. 8].

     [1]  The notice given by the Land Commission on the road parcels to Diana and Tarzan sufficiently complied with 67 TTC section 110, and no appeal was filed; therefore, the determination of ownership in favor of defendant will stand.  There is nothing in the record to reflect that such appeal was filed within the statutory provision of 120 days after Land Commission issued its determination on parcel nos. 031-K-02 and 032-K-02.

     [2]  The utility poles on the adjacent parcels do not constitute a trespass due to the fact that plaintiff has consented to their placement and has accepted the amount of one hundred dollars as compensation for crop

[5 FSM Intrm. 151]

damages; this is a contract between the parties.  The documents (promissory note) signed by plaintiff and Mr. Skilling, government agent, constituted the granting of an easement to Kosrae State for placing the utility poles.

     [3]  The failure by the state to use the procedures contained in 67 TTC 451 in acquiring title to the road parcels was not violative of constitutional due process.

     [4]  The actions of the Trust Territory Government in obtaining title to the road parcels did not violate the provisions of Article 6(2) of the Trusteeship Agreement.

     [5]  The encroachment by the road onto the land parcels has not been of the type nor continued long enough to ripen into prescriptive easement in the encroached area for the defendant, nor has it been willful enough to impose punitive damages upon defendant.

     A.  Road Parcels
          1.  Compliance with Title 67 section 110 TTC
     Plaintiff claims that title to the road parcels has been erroneously determined in favor of the Trust Territory Government, and that she received no notice of the registration hearings.  Defendant asserts that the Trust Territory complied with the notice provisions of the statute.
     The Trust Territory Code provides for registration of interests in land through a stated procedure, 67 TTC section 110.  This procedure is designed to ensure an orderly registration process and to protect against deprivation of property without due process.  The following are the basic requisites of the statute:  (a) preliminary inquiry, (b) posting of notices (in both languages) at (1) municipal offices in which the property is located (2) on the land, and (c) personal service on all parties shown to be "interested " by the preliminary inquiry.  67 TTC 110.

     At trial the evidence showed that defendant substantially complied with the notice requirements of the statute by posting and serving notices and holding a hearing. Plaintiff has not proven her right to relief for violation of the notice provisions of title 67.

     2.  Cloud on Title
     Plaintiff has alleged that the certificate of title in favor the defendant is a cloud on plaintiff's title, giving her a right to bring an action to quiet the title.  The Court does not view the so-called cloud on plaintiff's title as establishing a separate cause of action; rather, it is merely a restatement of her position with respect to the defendant.

[5 FSM Intrm. 152]

     3.  Violation of Article 6(2) of the Trusteeship Agreement
     Plaintiff alleges in her complaint that the following language of the Trusteeship Agreement for the Former Japanese Mandated Islands grants her a cause of action to recover the road parcels from the defendant in this matter:

In discharging its obligations under Article 76(b) of the Charter, the administering authority shall:
(2)  promote the economic advancement and self-sufficiency of the inhabitants, and to this    end shall regulate the use of natural resources; encourage the development of fisheries,    agriculture, and industries; protect theinhabitants against the loss of their landsand resources; and improve the means of transportation and communication.

Trusteeship Agreement art. 6(2) (emphasis added).

     Phrased differently, does Article 6(2) create a private cause of action in plaintiff to recover specific property and money damages, and if so, was there in fact a violation of Article 6(2)?

     This Court is aware of no FSM cases which have applied the provisions of the Trusteeship Agreement to cases brought before courts within the FSM.  Several Trust Territory Cases did, however, discuss the applicability of Article 6(2) to cases involving deprivation of land.  In Trust Territory v. Namiko Lopez, 7 TTR 449 (Truk 1976), the Court held that the Trusteeship Agreement did not apply to a foreclosure action on a real property mortgage.

The appellant also argues that the appellee breached its fiduciary duty under the trusteeship agreement by not making a full disclosure to its principal when entering into any business transaction with that principal.  This, of course is nothing more than another attack on the finding of the trial court and which we have determined is a proper finding.

Id. at 454.

     The Lopez case stands for the proposition that where there is no violation of due process of law, the provisions of article 6(2) are not implicated.  Thus, the Court will proceed to determine whether there was a deprivation of property in this case without due process of law.

     4.  Deprivation of Property without Due Process of Law
     In addition to her claim regarding notice of the registration hearing, plaintiff alleges that the failure by the state to use the procedures contained in 67 TTC Chapter 9 in acquiring title to the road parcels was

[5 FSM Intrm. 153]

violative of constitutional due process.  Defendant argues that these procedures are to be followed only in cases where the state desires to acquire rights in property which is already registered.

     Chapter 9 prescribes the procedure by which the Trust Territory Government could acquire interests in real property:

This chapter shall be applicable to the acquisition of real property under the laws of the Trust Territory for use in any project or program of the Trust Territory government, the district or municipal governments or the agencies created by the above enumerated governmental divisions.

67 TTC 451 (Pub. L. No. 6-71, 1).  Here the defendant acquired the title through the registration process to property over which it previously had little or no rights. The purpose was a district project, a road.  Thus, chapter 9 clearly applies on its face to the road parcels.  Contrary to defendant's assertion, there is nothing in the language of the foregoing section to indicate that this section would apply only where the land sought to be acquired had been previously registered.  The statute in question was enacted in 1971, at time at which very little land had been registered in Kosrae.

     Among the other provisions of chapter nine are the requirement of an appraisal, 67 TTC 452(b), and some form of compensation, 67 TTC 452(d), to the landowner.  The defendant conceded that neither of these took place.  The only proceeding was a registration proceeding at which the government was the only claimant.  However, the state did negotiate with the plaintiff and her predecessors in interest in good faith, as is required by section 452(1)(a).  Furthermore, there is nothing in the registration process which precludes the state from having title to property registered in its name if the registration procedure is followed.  See 67 TTC 110, et seq.

     It should also be noted that under the statute, a property owner may give a donation of property to the government.

     (4)  Nothing in this section should be construed to preclude a donation by an owner after his property has been appraised and the full amount of the estimated just compensation has been tendered to him.  67 TTC 452(e)(3).

     Here, it is clear that there was no tender of compensation, nor any appraisal of the property.  Plaintiff and her predecessors in interest may have consented to the construction of the road, but it is clear that the procedures contemplated by chapter 9 of Title 67 were not followed with respect to the road parcels.  Finally, chapter 9 states no remedy for failure by the government to comply with the chapter.

     Here, the Court is faced with a difficult decision.  Apparently, the defendant did not go through all the procedures required for acquisition of

[5 FSM Intrm. 154]

property for public projects, but instead obtained title to the road parcels through the registration process and good faith negotiations.  The evidence at trial established the fact that approximately half the existing circumferential road in Kosrae lies upon land registered in the government's name, using much the same procedure as was used in the present case.  The other half of the road is pursuant to easements granted by the landowners.  Certainly, if this Court ruled that the defendant must go back and appraise all the properties over which the road passes, an undue burden upon the State would result.

     This Court has noted previously that the requirements of constitutional due process vary with the rights which are at issue.  Where important rights are at stake, often will the procedure be more rigorous.  This Court has also noted the special place which land plays in the lives of Micronesians in general, and Kosraens in particular.  It is for this reason that significant procedural safeguards have been provided for the land registration process.  See Kosrae Code, Title 11.

     Here, the government did not obtain title to the property in bad faith, but negotiated use of the property, then obtained title through the registration process. Though the defendant did not use the appraisal or condemnation procedures provided in 67 TTC 451, it has not treated plaintiff in a manner which is unfair, or different than other landowners in Kosrae.  The Court cannot now impose such liability on the defendant, as it would result in massive unproductive litigation.  The political arena is much better suited to work out the question of eminent domain and the acquisition of private land for public projects.

     B.  The Adjacent Parcels
          1.  Road Encroachment
     The testimony of defendant's witnesses at trial established the fact that the road has wandered from the road parcels and has encroached at varying places up to five meters upon the adjacent parcels.  See [Def. Ex. 2]. The state alleges by way of affirmative defense that it has acquired an easement by prescription in the portions of the adjacent parcels upon which the road has encroached.  Easements by prescription are much the same as actions for adverse possession.  The major difference between the two actions is the type of remedy sought; in the former, a use right, in the latter, title to property.

     In order for the state to acquire an easement by prescription, the state's use must be open, notorious, hostile, and continuous for the statutory period, under a claim right.  25 Am. Jur. 2d Easements 49.  In this case at bar, the statutory provision provides twenty (20) years for recovery of interests in land.  KC 6.2503.  The evidence at trial showed that the state's use of the road was open, notorious and hostile to the owner's use, and under a claim of right.  However, the evidence did not establish that the state had encroached upon these portions of the adjacent property continuously for

[5 FSM Intrm. 155]

twenty years.  The evidence indicated only that the nature of this type of road is to wander.  Therefore, the Court, in viewing this evidence is of the opinion that the state cannot be deemed to have acquired prescriptive easement in this matter.

     2.  Utility Pole Encroachment
     At trial various documents were introduced which discuss the transaction between the plaintiff and defendant.  The parties have stipulated to the authenticity of many of these documents, and all were admitted as evidence.

     At trial, plaintiff testified that he believed at the time of signing of these documents that he expected further payment for the use of his land.  His testimony is clearly contrary to the unambiguous meaning expressed in these documents.  This is contrary to Mr. Skilling's testimony that the State is not interested in buying the land but to construct the power poles only.  Plaintiff has consented to the placement of the utility poles, and the state has not acquired an affirmative easement over the adjacent parcels for this purpose.

     C.  Defenses
     The state argued that the equitable doctrine of laches should prohibit plaintiff from asserting these causes of action because they are stale.  This equitable doctrine is a tool that courts use to limit a party's right because the right has not been asserted in a timely manner, such that it is unfair for a court to now redress them.  27 Am. Jur. 2d Equity 152, at 687 (1966).  The period of time required by this doctrine may be less than the statutory limitation on actions.  Id. at 692.  Each case must be judged on a case by case basis for fundamental fairness.

     During the trial the defendant argued that it would not be fair to enforce plaintiff's claim at this time for the reasons stated.  The determinations of ownership of the road parcels were not appealed; nor the issue raised for fourteen years.  This is not a sufficient period for doctrine of laches to apply to the encroachment, but the Court has ruled that title to the road parcels was properly determined by the Land Commission in favor of the Trust Territory Government.

     With respect to encroachments on adjacent property, however, there is evidence of assertion of the plaintiff's rights.  On several occasions, plaintiff's family has asserted rights over the encroachments.  Their actions showed that they were not intending to waive any rights over the adjacent parcels.

     The unfairness to the defendant is not of the type which is so unconscionable to preclude the assertion and enforcement of plaintiff's rights.  The portions of encroachment will either be removed or compensation will be paid.  This is not too great a burden for the state to bear, and is not so unfair as to be unconscionable. Therefore, the doctrine of laches will

[5 FSM Intrm. 156]

not apply to the encroachment.

     Title to parcels nos. 031-K-02 and 032-K-02 are vested in the State of Kosrae. The Land Commission substantially complied with the procedures stated in the Trust Territory Code in posting and serving notices, and no deprivation of property occurred without due process of law.  None of defendant's actions were in bad faith, therefore, no punitive damages will be assessed.

     The utility poles upon the adjacent parcels are neither trespass nor in violation of law; they are pursuant to an agreement by plaintiff's husband and defendant.

     The encroachment of the road upon adjacent parcels, does however constitute a trespass, the state of not having continuously used the property without interruption for the statutory period nor for a period of time as would make the assertion of plaintiff's right unfair.

     Defendant's liability for trespass by road encroachment on the adjacent parcels having been established, the damages portion of this trial will proceed accordingly.

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