Marine Revitalization Corp. v. DLNR
CourtSupreme Court of The Commonwealth of The Northern Mariana Islands
Date FiledDecember 14, 2010
Docket2009-SCC-0016-CIV
JudgeDemapan
StatusPublished
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Full Opinion
IN THE
SUPREME COURT
OF THE
COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS
_____________________________________________
MARINE REVITALIZATION CORPORATION AND ANTHONY PELLEGRINO, IN
HIS PERSONAL CAPACITY AND AS AN OFFICER OF MARINE REVITALIZATION
CORPORATION,
Plaintiffs-Appellees,
v.
DEPARTMENT OF LAND AND NATURAL RESOURCES,
Defendant-Appellant.
____________________________________
SUPREME COURT NO. 2009-SCC-0016-CIV
SUPERIOR COURT NO. 04-0589
____________________________________
Cite as: 2010 MP 18
Decided December 14, 2010
Edward Buckingham and David Lochabay, Saipan, Northern Mariana Islands for Defendant-
Appellant
Michael Dotts, Saipan, Northern Mariana Islands for Plaintiffs-Appellees
BEFORE: MIGUEL S. DEMAPAN, Chief Justice; ALEXANDRO C. CASTRO, Associate Justice;
HERBERT D. SOLL, Justice Pro Tem
DEMAPAN, C.J.:
¶1 Appellant Department of Land and Natural Resources (“DLNR”), appeals the third order
in aid of judgment in which the trial court set forth several methods of satisfying a stipulated
judgment entered in favor of Appellee Marine Revitalization Corporation (“MRC”). The order
awarded MRC tax credits worth over five million dollars, ordered that funds and income held by
DLNR be spent to satisfy the judgment, and ordered that money already appropriated for the
payment of judgments be transferred to MRC. DLNR contends that any action by a
Commonwealth court to directly or indirectly satisfy the judgment in the absence of a specific
appropriation for that purpose by the Commonwealth Legislature violates both the
Commonwealth’s Constitution and statutes. MRC counters that the government’s refusal to
satisfy the judgment constitutes a violation of our Constitution, and that this Court has the
authority to ensure that the government complies with the judiciary’s judgments and orders. For
the reasons set forth herein we hold: (1) the award of assignable tax credits to MRC to satisfy the
judgment was in error; (2) no part of DLNR’s budget or the income it derives from its operation
of the Outer Cove Marina can be used to satisfy the judgment; (3) federal funds cannot be
garnished to satisfy the judgment; (4) post-judgment interest does not accumulate against the
government on either the judgment or on any money already appropriated for the payment of
judgments; (5) money already appropriated by the Legislature for the payment of judgments must
be paid to MRC; (6) DLNR can be ordered to report to the trial court on a regular basis
concerning its efforts to satisfy the judgment; and (7) the trial court can only issue an order of
contempt for the government’s failure to comply with the portions of the third order in aid of
judgment that are upheld by this Court. Accordingly, we AFFIRM in part, REVERSE in part, and
REMAND this matter to the trial court.1
I
¶2 The facts of this case are relatively straightforward and undisputed. In 1995, the
Commonwealth Legislature enacted the Marine Revitalization Corporation Submerged Lands
Lease Act (“Public Law 9-46”). Public Law 9-46 authorized a contract between DLNR and MRC
for the construction of Outer Cove Marina. The contract provided that MRC would construct the
marina for the government, and the government would then lease the marina to MRC for a period
1
DLNR petitioned this Court for a stay of the Third Order in Aid of Judgment, which we granted.
MRC subsequently filed a Motion for Reconsideration. As the full Panel has considered all of the papers
filed in this matter, and issued its opinion, we choose to not write separately and address the Motion for
Reconsideration.
of fifteen years, during which time MRC would receive fees and profits from its operation. Public
Law 9-46 required that all commercial boats utilize the new marina and that the usage fees
collected would belong to MRC. Relying on the above contract, MRC executed a promissory note
for $700,000 in favor of Mobil Oil Marianas Incorporated to fund a boat fueling station and mini-
mart at the Outer Cove Marina. Public Law 9-46 provided for binding arbitration in the event of a
dispute, and that the decision of the arbitrators “shall be enforceable in the Commonwealth
Courts.” Appellant’s Excerpts of Record (“ER”) at 36.
¶3 After the construction of the marina, MRC claimed that DLNR breached the contract by
failing to require commercial boats to use the Outer Cove. The parties submitted the dispute to
arbitration. In December 2004, the arbitrators unanimously ruled in favor of MRC, finding not
only that DLNR failed to require commercial boats to use Outer Cove Marina, but that DLNR
also engaged in active competition against MRC by soliciting commercial boaters for its marina
at Smiling Cove in direct contravention of Public Law 9-46. The arbitration panel ultimately
awarded MRC more than five million dollars. Following the issuance of the arbitration award, the
parties stipulated to the entry of a judgment in the trial court. On January 27, 2005, the trial court
entered judgment in the amount of $5,919,849.99. Since the issuance of the arbitration award and
the entry of judgment, the Legislature has not made an appropriation to satisfy the judgment, and
the executive has not submitted proposed legislation to have any money appropriated to satisfy
the judgment.
¶4 Following the government’s failure to satisfy the judgment, MRC sought an order in aid
of judgment. Marine Revitalization Corp., v. CNMI Dept. of Lands and Natural Resources, Civ.
No. 04-0589D (NMI Super. Ct. May 10, 2005) ([Unpublished] Order in Aid of Judgment). The
trial court found that DLNR had not made any written request to the Legislature for an
appropriation of funds to satisfy the judgment. The court further found evidence indicating that
$20,000 was available in an account at the Department of Finance for the payment of judgments.
The motion for an order in aid of judgment was granted, and the trial court ordered DLNR to pay
the $20,000 “remaining of the amount originally appropriated by the Commonwealth Legislature
for the payment of Judgments” to MRC. Appellee’s Excerpts of Record (“ER”) at 7. The trial
court also ordered DLNR to pay all income from its operations into the court’s coffers bi-weekly.
The government ignored the order and did not challenge it on appeal.
¶5 From May 2005, when the first order issued, until February 2008, extensive settlement
talks ensued between the parties. During this period, however, the government did not make any
payments in accordance with the first order. In February 2008, the parties held their final
settlement conference. At that time, MRC presented seven detailed proposals for ways that the
government could begin to satisfy the judgment. The government rejected all seven proposals.
¶6 The government’s refusal to meet its contractual obligations resulted in MRC’s inability
to pay its creditors, including Mobil Oil, which filed separate suits against both the
Commonwealth and MRC. See Marine Revitalization Corp. and Anthony Pellegrino v. CNMI
Department of Lands and Natural Resources, Civ. No. 04-0589; Mobil Oil Mariana Islands, Inc.
v. Marine Revitalization Corp. and Anthony Pellegrino, Civ. No. 02-0566. Recognizing the
relationship between Mobil’s suits and the present action, as well as the practical reality that
Mobil would not be able to recover from MRC until the Commonwealth paid MRC, the trial
court consolidated the litigation for the purpose of facilitating a global resolution. See Mobil Oil
Mariana Islands, Inc. v. Marine Revitalization Corp. and Anthony Pellegrino, Civ. No. 02-0566
(Super. Ct. March 15, 2006) (Order on Defendant’s Motion to Consolidate). This consolidation
gives rise to Mobil’s status as an interested party in the instant appeal.2
¶7 After three years of government inaction, in 2008 MRC sought a second order in aid of
judgment. The trial court issued the second order in aid of judgment that again mandated the
prompt payment of the $20,000 from the original order, plus nine percent interest from May
2005, which was when the first order was issued. See Marine Revitalization Corp. v. CNMI Dept.
of Lands and Natural Resources, Civ. No. 04-0589D (NMI Super. Ct. May 21, 2008)
([Unpublished] Order in Aid of Judgment). The second order also allowed MRC to recoup the
balance of the judgment through tax credits. The government did not object or appeal the second
order in aid of judgment, but instead ignored the court’s directive. Four months later, DLNR
acknowledged the second order by filing a motion to quash and/or modify it. MRC opposed the
motion and filed a motion for the third order in aid of judgment that is now before the Court.
Mobil Oil joined in MRC’s motion for another order in aid of judgment.
¶8 In its third request for an order in aid of judgment, MRC asked the trial court to make the
tax credits granted in the second order assignable to third parties. At the hearing on DLNR’s
motion to quash the second order and MRC’s motion for a third order in aid of judgment, the
government did not dispute the validity of the initial stipulated judgment confirming the
arbitration award of approximately six million dollars, or that the entire amount of the judgment,
including accrued interest, remained outstanding. Instead, DLNR argued that under the
Commonwealth Code, judgments against the government can only be paid by specific
2
In its brief, Mobil states that “Mobil and MRC have entered into a conditional settlement in which
MRC has agreed to assign $1.5 million of its judgment against the CNMI to Mobil. Mobil has been
discussing with the CNMI how that amount could be paid over time in the form of tax offsets, but no final
agreement has been reached.” Response Brief of Plaintiff-Appellee Mobil Oil Mariana Islands, Inc. at 2.
appropriations by the Legislature and that no such appropriation had been made. The government
first pointed to 7 CMC § 2251(b), which waives sovereign immunity for any suit “founded upon
any law of this jurisdiction . . . or upon any express or implied contract with the Commonwealth
government.” The government then relied on 7 CMC § 2254, which provides “[j]udgments
rendered pursuant to this article shall be paid from such funds as may be appropriated by the
Commonwealth Legislature for that purpose.” In essence, the government argued that it could not
satisfy the arbitration award and the stipulated judgment because the Legislature failed to make
the necessary appropriation. For reasons discussed more fully below, the trial court disagreed,
finding 7 CMC § 2254 inapplicable because the original stipulated judgment was “rendered
pursuant to” Public Law 9-46 rather than the waiver of sovereign immunity contained in 7 CMC
§ 2251(b).
¶9 In February 2009, the trial court granted MRC’s motion for a third order in aid of
judgment, and it affirmed and incorporated the earlier orders as well as MRC’s request to make
the tax credits assignable. The order provides in pertinent part:
1. The $20,000 ordered paid to Plaintiff’s [sic] on May 10, 2005, shall be
paid to Plaintiff’s counsel on or before April 1, 2009, with an
accumulated interest at the rate of 9% from May 10, 2005 to the date of
payment;
2. DLNR shall pay all income biweekly of DLNR received from its
operations at the marina at Outer Cover [sic] in Saipan including, but not
limited to the boat slip rental fees, to cover Plaintiff’s costs on executing
this judgment into the court;
3. DLNR shall report to the Court by April 30, 2009, on what efforts have
been made to obtain an appropriation of funds by the legislature to pay
the judgment and to report to the Court on what has been collected out of
the operation of the DLNR;
4. Plaintiffs, as well as all CNMI corporations in which Plaintiff’s [sic]
Marine Revitalization Corporation or Anthony Pellegrino is the sole
shareholder, are hereby authorized to use Plaintiffs’ portion of the
judgment ($5,646,679.00 plus 9% interest from January 27, 2005) as a
dollar-for-dollar offset (the “Tax Offset”) against the CNMI Gross
Revenue Tax . . . .
5. Plaintiffs may assign for consideration all or a portion of its Stipulated
Judgment, entered on January 23, 2005, to any third persons or entities.
The amount assigned shall be taken by the assignee(s) as a dollar-for-
dollar offset against CNMI Gross Revenue Tax . . . .
6. [discussing the procedure for using the assignable tax credits].
7. In the event the Order is not complied with, Plaintiffs are authorized to
seek further relief, including but not limited to an order garnishing
federal funds, appropriating portions of DLNR’s budget, and obtaining a
finding of contempt from the Court.
Appellant’s ER at 5-7. DLNR appeals the third order in aid of judgment, which we have
jurisdiction over pursuant to 1 CMC § 3102.
II
¶ 10 The facts in this appeal present a very troubling scenario. The Commonwealth
government entered into a contract, which by its own terms was enforceable in the
Commonwealth Courts, then breached that agreement and has now failed to fulfill its contractual
obligations by repeatedly ignoring a multi-million dollar judgment. Perhaps most troubling is the
fact that the government does not dispute the validity of the judgment or of the debt; rather, the
Attorney General is put in the unenviable position of arguing that the separation of powers
doctrine allows the government to simply ignore a valid judgment to which it stipulated because
the Legislature failed to appropriate money for that judgment.
¶ 11 DLNR argues that the trial court’s order violated the Commonwealth Constitution and the
separation of powers doctrine by indirectly appropriating public funds without the approval of the
Legislature. The government also argues that pursuant to Commonwealth statutory law,
judgments against the government cannot be paid unless the Legislature makes an appropriation
for the payment of the specific judgment in question. MRC responds that the government’s
repeated refusals to act on the trial court’s orders itself violates the separation of powers doctrine;
that is, the executive and legislative branches cannot completely ignore a directive of the
judiciary—a co-equal branch of government. We review de novo constitutional and statutory
questions. N. Marianas College v. Civil Service Comm. II, 2007 MP 8 ¶ 2.
A. Constitutional Issues
¶ 12 The Commonwealth Constitution provides for a tripartite system of government. Article
II sets forth the powers of the Legislature, Article III sets forth the powers of the Executive, and
Article IV sets forth the powers of the Judiciary. This organization, distributing the powers
among the coordinate branches of government, gives rise to the separation of powers doctrine.
Norwood v. Horney, 853 N.E.2d 1115, 1148 (Ohio 2006) (holding that the separation of powers
doctrine is implicitly embedded in the entire framework of those sections of the state constitution
that define the substance and scope of powers granted to the three branches of state government).
The separation of powers principle operates in a broad manner to confine legislative powers to
the legislature, executive powers to the executive, and those powers which are judicial in
character to the judiciary. VanSickle v. Shanahan, 511 P.2d 223, 235 (Kan. 1973). Simply stated,
the doctrine forbids one branch of government from exercising the powers properly belonging to
another branch. Admin. Office of Ill. Cts. v. State and Mun. Teamsters, Chauffeurs and Helpers
Union, Local 726, 657 N.E.2d 972, 981 (Ill. 1995).
¶ 13 Both parties argue that the trial court’s third order in aid of judgment should either be
upheld or invalidated on separation of powers grounds. The government relies on Articles II and
X of the Commonwealth Constitution, which collectively bestow upon the Legislature control
over the power to expend public funds. Article II, section 5 of the Commonwealth Constitution
grants the Legislature the power of the purse, providing that “[a]ppropriation and revenue bills
may be introduced only in the house of representatives.” NMI Const. art. II, § 5(a). Likewise,
Article X, which governs taxation and public finance, provides that “[a] tax may not be levied and
an appropriation of public money may not be made, directly or indirectly, except for a public
purpose. The legislature shall provide the definition of public purpose.” NMI Const. art. X.
Together, these provisions imbue the Commonwealth Legislature with exclusive control over the
direct or indirect expenditure of public funds. The government also relies on the separation of
powers principle that:
[A] judgment against the state . . . merely liquidates and establishes the claim
against the state, and that, in the absence of an express statute so providing, such
judgment cannot be collected by execution against the state or its property, or by
any of the ordinary processes of law provided for the enforcement of judgments;
it remains for the state, after such judgment, to provide for the payment thereof in
such manner as it sees fit . . ., and the judgment creditor can obtain payment in no
other way than that provided.
Westinghouse Electric Co. v. Chambers, 145 P. 1025, 1026 (Cal. 1915).
¶ 14 For its part, MRC argues that the government’s failure to comply with the trial court’s
order encroaches upon the province of the judiciary, which generally includes the authority to
hear and determine justiciable controversies. This includes the authority to enforce valid
judgments, Del Papa v. Steffen, 915 P.2d 245, 250-51 (Nev. 1996), and that the trial court in this
case had the inherent power to enforce a valid judgment. Specifically, MRC directs this Court to
Article IV, section 2 of the Commonwealth Constitution, which provides that “[t]he Superior
Court shall have all inherent powers, including the power to issue all writs necessary to the
complete exercise of its duties and jurisdiction under the constitution and laws of the
Commonwealth.” We must determine how these constitutional provisions interact with each
other, and how that interaction affects the third order in aid of judgment.
¶ 15 The United States Supreme Court recognizes that if a state consents to be sued that its
waiver of sovereign immunity does not allow its courts to force it to make an appropriation to
satisfy a judgment in the absence of such consent; such a scheme does not run afoul of any
section of the U.S. Constitution. Baltzer v. North Carolina, 161 U.S. 240, 245-46 (1896). In
Baltzer, the Court recognized the principle that:
When a judgment has been rendered, the liability of the State has been judicially
ascertained, but there the power of the court ends. The State is at liberty to
determine for itself whether to pay the judgment or not. The obligations of the
contract have been finally determined, but the claimant has still only the faith and
credit of the State to rely on its fulfillment.
Id. at 243 (citing R.R. Co. v. Tenn., 101 U.S. 337, 340 (1880)). The Court further stated that a
state “may refuse to pay, that is, may refuse to make the necessary appropriation, and the courts
are powerless to compel them to do so.” Id. In Baltzer, the plaintiff sued the state of North
Carolina after it amended its constitution to forbid the payment of any debt or bond incurred
during 1868, which was the year when the state ratified its new constitution and regained
admission to the Union. After the amendment’s ratification, the plaintiff sued for interest the
states owed him on his bonds. Finding that North Carolina consented to the suit, the Court
nevertheless recognized that this consent did not extend to the enforcement of a judgment against
the state, and that this did not run afoul of the Contracts Clause or any other section of the U.S.
Constitution. Id. at 245-46. Thus, there is not a U.S. Constitutional rule requiring a state to honor
judgments against it, and this includes situations where the state has breached one of its contracts.
¶ 16 MRC, however, cites federal case law for the proposition that the Commonwealth Courts
can enforce judgments against the Commonwealth government. Both the trial court and MRC in
this appeal rely on Camacho v. Commonwealth of the Northern Mariana Islands, Civ No. 05-
0043 (D.N.M.I. 2008). In Camacho, the Commonwealth government took the plaintiff’s real
property for the purposes of paving and widening a road. The plaintiff filed suit seeking just
compensation under the Takings Clause of the U.S. Constitution, and subsequently obtained a
judgment in his favor. The government, however, failed to satisfy the award. The plaintiff then
sought a writ of execution or an order in aid of judgment to force the government to satisfy the
judgment. The government argued that under Commonwealth law the plaintiff had no way of
enforcing the judgment absent an appropriation by the Commonwealth Legislature. The District
Court disagreed and granted the order. Without any supporting authority, the District Court
reasoned that the Legislature’s failure “to fulfill its constitutional mandate does not, cannot, and
will not prevent the court from taking all necessary steps to ensure that its judgments are
enforceable. A court that cannot enforce its judgments must forever close its doors, as it will have
become nothing more than an historical curiosity.” Appellee’s ER 6 at 44.
¶ 17 The District Court in Camacho does not cite any supporting authority for its order. As
MRC points out in its brief, however, federal courts often order state governments to satisfy
federal judgments even in the face of state statutes requiring legislative appropriation. For
example, federal courts routinely force states to pay costs in federal civil rights actions, Gates v.
Collier, 616 F.2d 1268 (5th Cir. 1980), and order municipalities to levy taxes to remedy racial
discrimination in public schools. Jenkins v. Missouri, 855 F.2d 1295 (8th Cir. 1988).
¶ 18 These federal cases, however, are inapplicable for two very significant reasons. First,
they all arise in federal court, which is not a co-equal branch of state government subject to the
same separations of powers issues that bind this Court. Second, and perhaps more importantly,
they all involve federal constitutional issues—namely, the Takings Clause, the Equal Protection
Clause, or the Due Process Clause—or are brought pursuant to the Civil Rights Act. Since federal
law supersedes conflicting state law under the Supremacy Clause, federal courts hold that where a
state violation of federal law results in a judgment against the state, the federal courts possess the
authority to enforce those judgments. The facts of this case, however, do not implicate any federal
constitutional issues. As the Ninth Circuit stated in Spain v. Mountanos, 690 F.2d 742, 746 (9th
Cir. 1982), “[u]nder the Supremacy Clause of the United States Constitution, a court, in enforcing
federal law, may order state officials to take actions despite contravening state laws.” In this case
MRC is in a Commonwealth Court and fails to raise any federal Constitutional issues. Thus, the
Supremacy Clause is not applicable and the federal cases cited by the trial court and by MRC do
not provide a valid basis upon which this Court can permissibly uphold the lower court’s order.
¶ 19 Turning to the state courts that have addressed this issue, those courts are in almost
unanimous agreement that they cannot compel the legislature to appropriate funds either directly
or indirectly to satisfy a judgment. Smith v. State of North Carolina, 222 S.E.2d 412 (N.C. 1976),
stands for the proposition that while the court is empowered to declare the rights as between a
judgment creditor and the government, it cannot enforce the judgment absent legislative
appropriation. In that case, a doctor received an appointment as superintendent of a state hospital
for a term of six years pursuant to statute, but his state employer discharged him without cause
and without a hearing. Following his termination, the doctor sought severance pay from the
governor and the budget commission—pay that the doctor was statutorily entitled to receive.
After the governor and budget commission failed to take action, the doctor filed suit to compel
the government to pay him $250,000 in severance.
¶ 20 In Smith, the court first determined that a valid contract existed between the doctor and
the government. 222 S.E.2d at 417. The court then framed the issue as follows: “[h]aving
determined that a contract existed between plaintiff and the State, the question is whether the state
is immune from an action for damages for the alleged breach of that contract.” Id. The court
began with the rule that
[t]he rights and responsibilities of a state under an ordinary business contract are,
with few exceptions, the same as those of individuals. Although it cannot be sued
without its consent, the state, when making a contract with an individual, is liable
for a breach of its agreement in like manner as an individual contractor.
Id. Notwithstanding the above proposition, the court then went on to say that “there is an[] . . .
essential and far-reaching difference between the contracts of citizens and those of sovereigns,
not, indeed, as to the meaning and effect of the contract itself, but as to the capacity of the
sovereign to defeat the enforcement of its contract.” Id. at 418. The court stated that the
difference exists in the fact that “[t]he legislature has the ability to avoid payment of the
obligations of the state by a failure or refusal to make the necessary appropriation . . . . Unless
there is an appropriation, courts have no power to enforce a contract of a state, even though they
do not doubt its validity.” Id.
¶ 21 The court then quotes a number of cases all making similar proclamations: that although
the courts cannot force the legislature to fulfill its contractual obligations, the government
nonetheless has a duty to its citizenry of faithful performance. Id. at 419-22. Quoting Ace Flying
Service, Inc. v. Colorado Department of Agriculture, 314 P.2d 278, 280 (Colo. 1957), the court
states:
To hold that the state may enter into a contract by which the other party is
compelled to expend large sums in acquiring material, machinery and personnel
to enable it to perform its obligation, and then arbitrarily repudiate the contract
relegating the injured party to the doubtful remedy of appealing to the legislature
for justice in the form of a bill for relief, would be to sanction the highest type of
governmental tyranny.
Id. at 421
¶ 22 After wading through a litany of cases admonishing the government to fulfill its
contractual obligations, the court then states:
[i]n the event plaintiff is successful in establishing his claim against the State, he
cannot, of course, obtain execution to enforce the judgment . . . . The judiciary
will have performed its function to the limit of its constitutional powers.
Satisfaction will depend upon the manner in which the General Assembly
discharges its constitutional duties.
Id. at 424. Finally, the court states that “[w]e do not apprehend that this decision will result in any
unseemly conflict between the legislative and judicial branches of the government . . . . Past
performance convinces us that when the State has entered into a contract, the officials who made
it intended that the State would keep its part of the bargain.” Id.
¶ 23 As the above discussion indicates, Smith is not directly on point. Unlike the present case,
in Smith no valid judgment existed. The question in that case was whether the employee could
sue the government. It did not involve a request for the court to enforce an already existing
uncontested judgment. Id. at 424 (“Today we decide only that plaintiff is not to be denied his day
in court because his contract was with the State.”). Furthermore, the case was premised on the
assumption that the government would comply with its contractual obligations—an assumption
already proven untrue in this case.
¶ 24 In Newman Marchive Partnership, Inc., v. City of Shreveport, 979 So.2d 1262, 1265 (La.
2008), which is closer factually to the case now before us, and does not premise its holding on
hopeful notions that the government will do what it says it will do, the Louisiana Supreme Court
held, without apology, that it is constitutionally prohibited from invading the province of the
legislature and forcing the state to pay its debts when it refuses. In that case, a construction
company contracted with the City of Shreveport to renovate a stadium. The company brought suit
for breach of contract and received a sizable judgment in the trial court. After the City failed to
pay the judgment, the company brought an action to compel payment. The trial court issued a writ
of mandamus, compelling the City to satisfy the judgment, and the City appealed. The issue on
appeal was “whether the judicial branch may . . . compel a political subdivision of the state to pay
a judgment rendered against it” when no appropriation has been made to satisfy the judgment. Id.
at 1264. The Louisiana Supreme Court held that it could not.
¶ 25 In Newman, the court began with the state constitutional and statutory provisions
concerning suits against the government and the payment of judgments. Id. at 1265. The court
first pointed out that the constitution waives sovereign immunity for certain claims sounding in
contract and tort. Id. The court then cited a statutory provision, which provides that “[a]ny
judgment rendered in any suit filed against the state, a state agency, or a political subdivision . . .
shall be exigible, payable, and paid only out of funds appropriated for that purpose by the
legislature . . . .” Id. at 1266 (citation omitted). Given the applicable constitutional and statutory
provisions, the court held that while “the judicial branch is empowered to render judgments
against the state . . . the constitution does not provide the judiciary with the ability to execute
those judgments.” Id. at 1265. The court further recognized that:
Admittedly, [the constitutional and statutory provisions] create[] a frustrating
dichotomy for the state’s judgment creditors . . . . Still, the combined effect of
[these provisions] is clear. Judgments against a political subdivision of the State
may only be paid out of funds appropriated for that purpose . . . and under no
circumstance shall public property or public funds . . . be subject to seizure.
Id. at 1266 (quotations and citations omitted).
¶ 26 In Amantia v. Cantwell, 213 A.2d 251 (N.J. 1965), government employees sought a
declaratory judgment that they were entitled to differential pay pursuant to statute, and also
sought a writ of mandamus to compel the state treasurer to make provision for the payment. The
court granted declaratory relief, stating that “it is clear to us that petitioners are entitled to the pay
they seek, and we so hold.” Id. at 254. The court denied, however, the employees’ request to
compel payment, stating:
What this court cannot do, however, is direct that the money be paid to the
petitioners or compel respondents to request an appropriation. The power to
appropriate money rests with the Legislature. While we recognize petitioners’
moral and legal right to the differential pay they seek, this court cannot secure it
for them by way of a directive. We can and do declare that the money is due
them. Whether or not petitioners receive the money to which they are clearly
entitled rests exclusively with the Legislature.
Id.
¶ 27 Similarly, in Magnetti v. University of Maryland, 909 A.2d 1101, 1106 (Md. Ct. Spec.
App. 2006), the appellate court held that even where a statute exists providing that a
governmental entity may sue or be sued, “obtaining a money judgment requires a two-part
showing: first, that specific legislative authority for suits has been given, and second, that funds
have been appropriated for the purpose of satisfying a money judgment.” In Fitzgerald v. Palmer,
219 A.2d 512, 513 (N.J. 1966), the court held that it “could not enforce a judgment if it gave one.
No money may be drawn from the State treasury but for appropriations made by law. . . . The
judiciary could not order the Legislature to appropriate money, or the Governor to approve an
appropriation if one were made.” See N.J. Div. of Youth and Family Serv. v. D.C. and M.C., 571
A.2d 1295, 1301 (N.J. 1990) (stating that “[n]o money may be drawn from the State treasury but
for appropriations made by law” unless the constitution mandates the disbursement); see also
Soto v. Nebraska, 693 N.W.2d 491, 498 (Neb. 2005) (holding that a statute that requires
legislative review and appropriation of workers’ compensation claims in excess of $50,000 does
not violate the separation of powers doctrine).
¶ 28 Turning our gaze further into the past, we find that the rule that courts may not enforce
judgments against the state, because such an action would amount to an appropriation of funds in
violation of the separation of power doctrine, has long existed. In Campbell Building Co. v. State
Road Commission, 70 P.2d 857, 862 (Utah 1937), the court recognized that while its judgment
was valid, the state “may refuse to respond in damages and leave a claimant without any remedy,
as it may refuse to pay its bonds.” Nevertheless, “the obligation remains. No legislative fiat can
destroy or impair that.” Id. In State v. Woodruff, 150 So. 760, 766 (Miss. 1933), the court
explained that:
A judgment or decree against the state for the payment of money, although
entered by its highest court, is not enforceable except by a legislative
appropriation. If the case is clear, and there is no available defense to the
liability, the court should enter the judgment, although it may be that at the time
being it will meet with legislative disobedience. But in order to render such
disobedience inexcusable, and therefore improbable, any such judgment should
go to the legislature as an unreserved and solemn recommendation by the court
that the liability is fair and free from serious doubt, and that there are no valid
defenses known to the law or recognized in equity which the court has failed to
discern and to apply.
In Carr v. State, 26 N.E. 778, 779 (Ind. 1891), the court explained that “[c]reditors who accept
the obligations of a State are bound to know that they cannot enforce their claims by an action
against the State directly . . . . Whether an appropriation shall or shall not be made is purely a
legislative question.” See Herrick v. E.G. Gallet, 204 P. 477, 478 (Idaho 1922) (“The mere
declaration that certain charges against the state must be paid out of the state treasury does not
necessarily make an appropriation . . . . [N]o money may lawfully be paid from the treasury
except pursuant to and in accordance with an act of the legislature expressly appropriating it to
the specific purpose for which it is paid.”); Myers v. English, 9 Cal. 341, 349 (1858) (“[T]he
Courts have no means, and no power to avoid the effect of non-action. . . . Therefore, when the
Legislature fails to make an appropriation, we cannot remedy that evil.”) (emphasis added).3
¶ 29 Despite all of the above authority, MRC contends that at least one court holds that it can
enforce a judgment against the state, and therefore, we should follow that court’s decision in
order to vindicate our constitutionally bestowed right to enforce our judgments. In AFSCME/Iowa
Council v. State, 484 N.W.2d 390 (Iowa 1992), unions representing public employees brought an
action to enforce an arbitration award granting wage increases to government employees. The
question, as framed by the court, was “[c]an the government be made to perform in accordance
with its contracts, or is the other party, by reason of constitutional and statutory rules intended to
prote