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Court rules—statute requiring Congressional approval of FSM EEZ access agreements is unconstitutional
Pohnpei, FSM—Motions and arguments in a case filed by Pacific Food and Services, Incorporated (PF&S) have resulted in an FSM Supreme Court ruling that part of the FSM Code that regulates fishing licenses in the FSM Exclusive Economic Zone is unconstitutional.
Congress has asked the court to amend the ruling to allow them to seek an interim appeal with the Supreme Court Appellate Division.
The case (Civil Action number 2009-001) was filed in January of 2009 by PF&S against the National Oceanic Resource Management Authority (NORMA), the Federated States of Micronesia, the Congress of the FSM, and Bernard Thoulag in his official capacity as Executive Director of NORMA. PF&S filed suit after Congress refused to approve an agreement for fishing licenses after which NORMA immediately cancelled all agreements with PF&S.
“I told my attorney that we don’t want to sue any person. We just want justice for the people of the FSM not just for myself,” said Perdus Ehsa. “The case is easier now because the question about constitutionality has been answered.”
The background information in the court ruling said that PF&S had an agreement with NORMA for fishing licenses that expired in November 2006. On November 6, 2006, PF&S and NORMA concluded a one-year successor agreement and promptly submitted it to Congress.
The agreement remained in effect until Congress passed a resolution on September 26, 2006 rejecting the agreement. NORMA then cancelled permits that had been issued to PF&S represented vessels. Those vessels in turn terminated their agreements with PF&S and entered agency agreements with PF&S competitors.
A footnote in the court ruling said that the reason Congress gave for rejecting the agreement was PF&S’s financial condition and also a $150,000 FSM Supreme Court judgment against it held by National Fisheries Corporation. The footnote said that while fishing boats and their owners are banned from applying for or obtaining FSM EEZ fishing licenses if there are unsatisfied FSM Supreme Court judgments in excess of $25,000 there is no similar ban for access agreement agents such as PF&S.
The FSM code (Title 24) which governs negotiation and execution of licensing agreements in the FSM EEZ contains a section 405 which essentially says that NORMA can negotiate agreements for fishing companies and can issue licenses based on those agreements, but that if the company handles nine or more fishing vessels, Congress has the power to review those agreements and to approve or reject them.
The Supreme Court said in its ruling that section 405 is unconstitutional essentially because it allows Congress to act in an enforcement role of a law they passed which is an Executive branch function.
It quoted a 2003 precedent from a case between the FSM and Udot Municipality: “Once a public law is enacted, the responsibility for the execution and implementation of the law rests with those who have a duty to execute and administer the law, and Senators can have no further role in its execution…”
The June 2010 ruling of the FSM Court said, “Negotiation and approval of commercial transactions is ordinarily an executive power. Congress has enacted Title 24 and engaged in an executive function by formally inserting itself into the execution and implementation of a portion of that act by vesting in itself the power to control how the law regarding fishing access agreements is executed when more than nine vessels are involved. This is impermissible under the separation of powers doctrine.”
The Court rejected the Congress argument that section 405 must be constitutional since it is a function of its treaty ratification powers. Congress pointed in support of their argument to the definition “access agreement,” (24 F.S.M.C 102(1)) which says, “Access agreement means a treaty, agreement or arrangement entered into by the Authority (NORMA) pursuant to this act (Title 24) in relation to access to the exclusive economic zone for fishing by foreign fishing vessels.”
The Court reasoned that a fishing access agreement is usually not a treaty and that certainly in the case of PF&S’ access agreement it can’t be considered to be a treaty particularly because it was an agreement between a Pohnpei Corporation and the national government. It concluded that even if the agreement had been between a foreign corporation and the national government it still would not have been a “treaty.” “They are business deals—not treaties,” the court conclusion stated.
Congress had asserted that ruling section 405 unconstitutional would
impair its ability to ratify treaties and to advise and consent to
presidential appointments.
The court said “This is false…Those powers are enshrined in the
Constitution. Approval of commercial fishing agreements, however, is
not a power that the Constitution confers on Congress, but a power that
Congress has conferred upon itself by statute.”
Congress also contended that since Congressional approval or rejection
of access agreements is a “time honored procedure” of Congress, the
court should consider it to be constitutional.
The court said that “the passage of time does not automatically make a
practice (or a statute) constitutional. In this case it has not.”
Congress asserted that section 405 adds an extra layer of review
necessary to see that the fishing access agreements that are adopted are
in the nation’s best interest.
The court said “If Congress feels that the current title 24 statutory
requirements for access agreements are too loose or are not in the
nation’s best interests and should be tightened, it can enact further
and stricter requirements. If Congress feels that another layer of
review is needed to protect the nation’s interests, Congress can provide
for that review by creating a mechanism for further review in the
executive branch…but Congress may not execute the laws itself and under
405 it does just that.”
PF&S had asked the court to consider whether or not the section 405
resolution process would violate the Constitution’s two-reading
enactment clause, and presentment-to-the-President requirements. It
said that since it ruled section 405 to be unconstitutional on
separation-of-powers grounds there is no reason for the court to rule on
that matter.
The court asked PF&S during its hearings what relief it sought
against Congress. The only answer the court received was that they
should determine that the law (section 405) was invalid. “If PF&S
does not, within 20 days of this order, specify what other relief its
Complaint seeks against Congress, the court will grant the motion to
dismiss for failure to state a claim upon which the court can grant
relief for defendant Congress only,” the ruling said.
The court, in absence of any written or oral response from plaintiff
PF&S to the defendants’ motion to strike the PF&S allegation
that an FSM Senator had a conflict of interest, granted that motion. It
said that even lacking opposition to a motion the court must have good
grounds before it can grant a motion. It said that the allegation was
“immaterial and impertinent to the question of 24 F.S.M.C 405’s
constitutionality. It may also be scandalous,’ and the court granted
the motion to strike any allusions or implications in PF&S’s
pleading alleging a congressman’s conflict of interest.
Ehsa said in a telephone conversation on the matter, that there were
actually two Senators that may have had conflicts of interest. He
seemed to think that issue would still be on the table at a later date.
But a footnote to the Court’s ruling said “If a Congressman had a
conflict of interest and did not take steps to avoid that conflict, that
is an ethical lapse that Congress, not the Court, has the authority to
consider and, if proper, impose sanctions or discipline on the
Congressman.”
It appears from the ruling that any further discussion regarding
possible conflict of interest in the matter is prohibited and that the
allegation itself is stricken and will not be considered in any further
court rulings.
The court said that it would be willing to entertain motions that would
allow for an interlocutory appeal. Interlocutory appeals (interim
appeals) are sometimes granted if the trial division is of the opinion
that a decision it has made in a civil action involves a controlling
question of law as to which there is substantial ground for difference
of opinion and that an immediate appeal from the order may materially
advance the ultimate termination of the litigation.
The Court said that it would be willing to entertain a motion to amend
its ruling to allow for an interlocutory appeal. If that motion is
granted and the order is amended the appealing party can file an appeal
with the Supreme Court Appellate Division within 10 days of the amended
order in the trial division.
The trial on the civil action continues unless an Appellate Division
Justice orders the trial to be stayed pending a decision on the
interlocutory appeal in the appellate division.
Congress did file a motion asking for the trial justice to amend the
order to allow for an interlocutory appeal of the decision regarding
constitutionality of section 405. They argued that the FSM Constitution
under Article IX Section 2(m) speaks directly to the matter. Section
2(m) expressly gives Congress the power, “to regulate the ownership,
exploration, and exploitation of natural resources within the marine
space of the Federated States of Micronesia beyond 12 miles from island
baselines.”
A document filed by the attorney for PF&S said that the plaintiff
does not object to the motion but does reserve the right to argue the
matter before the court.
The court had not at press time issued a ruling on the motion so now appeal is yet being heard in the Appellate Division.
The June 21, 2010 Supreme Court ruling did not consider the matter of
relief for plaintiff PF&S other than ruling section 405 to be
unconstitutional. The matter of financial relief if any, is to be left
to further proceedings. The ruling defined the deadlines for submission
of discovery and pretrial motions in those and other matters.
Ehsa said that the particulars of the requests for relief are part of
SP&S’ filing on the matter and include such things as lost profit,
attorneys fees, and reimbursement of fees paid for licensing in advance
that were lost when the agreement was terminated. Most of all they’d
like to get their license back. He didn’t immediately remember if they
had asked for other types of relief.
Under the current schedule those matters won’t even begin to be considered until sometime after November 1.
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