Aurelio v. Camacho

IN THE SUPREME COURT OF THE COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS MARITES A. AURELIO, RONNA D. SANTO DOMINGO, AND ROSALINA C. OLIVA, Plaintiffs-Appellees, v. BIENVENIDA C. CAMACHO AND FELIPE SN. CAMACHO, Defendants-Appellants. SUPREME COURT NO. 2011-SCC-0023-CIV SUPERIOR COURT NO. 10-0021E OPINION Cite as: 2012 MP 21 Decided December 31, 2012 Reynaldo O. Yana, Saipan, MP, for Defendants-Appellants Bienvenida C. Camacho and Felipe SN. Camacho. S. Joshua Berger, Saipan, MP, for Plaintiff-Appellees Marites A. Aurelio, Ronna D. Santo Domingo, and Rosalina C. Oliva. BEFORE: ALEXANDRO C. CASTRO, Chief Justice; JOHN A. MANGLONA, Associate Justice; EDWARD MANIBUSAN, Justice Pro Tem.1 MANGLONA, J.: ¶1 Defendant-Appellant Bienvenida C. Camacho (“Camacho”) appeals the trial court’s Order, which ordered her to convey her townhouse in the Philippines to Plaintiffs-Appellees Marites A. Aurelio, Ronna 1 The Honorable Edward Manibusan, Justice Pro Tem, heard oral arguments in this matter but did not participate in the judgment.  D. Santo Domingo, and Rosalina C. Oliva (collectively “Plaintiffs”) through their attorney. Camacho claims: (1) the trial court did not have the authority to exercise its jurisdiction in such a manner; and, even if it did, (2) 7 CMC § 4210(c) exempts the property from attachment because she owns the property solely in her own right. In contrast, Plaintiffs counter that: (1) the trial court did have the authority to order Camacho to transfer the Philippines property to the Plaintiffs; and (2) 7 CMC § 4210(c) does not apply since it only protects primary residences within the Commonwealth. For the reasons discussed below, we AFFIRM the trial court’s finding it could order Camacho to convey real property in the Philippines to satisfy a judgment, but VACATE the Order and REMAND for further proceedings consistent with this opinion. I ¶2 Plaintiffs filed a complaint with the Commonwealth Department of Labor against Camacho, a citizen of the Philippines who has resided in Saipan for twenty-five years and operated the establishment, Benny’s Place. Excerpts of Record (“ER”) at 5, 7, 26; Marites A. Aurelio, L.C. No. 05-168 at 2 (NMI Dept. of Labor Apr. 27, 2007) (Administrative Order) (“Administrative Order”). Plaintiffs alleged numerous violations of the Nonresident Worker Act and Alien Labor Rules & Regulations, including that Camacho failed to pay hourly wages, made unlawful deductions, altered employment contract terms, and improperly restricted the Plaintiffs to the company barracks. Administrative Order at 1. ¶3 After an evidentiary hearing, the Department of Labor issued an Administrative Order. The Administrative Order: (1) recommended that the Attorney General investigate whether Camacho violated the Anti-Trafficking Act of 2005, (2) awarded Plaintiffs over $122,000 in damages and attorney’s fees, and (3) imposed $10,000 in sanctions against Camacho. Id. at 21-27; Marites A. Aurelio, L.C. No. 05-168 at 1 (NMI Dept. of Labor Apr. 27, 2007) (Administrative Order Awarding Attorney Fees). ¶4 Camacho appealed the attorney fee award, which the Secretary of Labor subsequently affirmed. Camacho did not appeal the Secretary’s ruling. ¶5 Camacho failed to pay, prompting Plaintiffs to file a complaint with the trial court to enforce the Administrative Order. The trial court entered a judgment against Camacho for $157,511.20. ¶6 The Plaintiffs then filed a motion for an order in aid of judgment. During a deposition to determine her assets, Camacho disclosed she was the sole owner of a townhouse, including the land it sits on in Las Pinas, Philippines. ER at 13. The trial court ordered Camacho to transfer her interest in the townhouse to the Plaintiffs through their lawyer, the Law Offices of S. Joshua Berger, because “it would be in the interest of Justice.” ER at 7; Aurelio v. Camacho, Civ. No. 10-0021E (NMI Super. Ct. June 28, 2011) (Order Granting Plaintiff’s Motion for the Seizure of Real Property) (“Seizure Order”). In coming to its decision, the trial court found: (1) it could compel Camacho to transfer her foreign townhouse  because it had personal jurisdiction over her; and (2) 7 CMC § 4210(c) is a homestead exemption, but concluded that as a matter of law § 4210(c) could not protect Camacho’s townhouse. Id. II ¶7 The Supreme Court has appellate jurisdiction over final judgments and orders of the trial court of the Commonwealth. 1 CMC § 3102(a). Here, the Seizure Order was never set forth on a separate document and, thus, was not a “final judgment” when entered on June 28, 2011. The judgment nonetheless became a “final judgment” 150 days after entry. NMI Sup. Ct. R. 4(a)(7)(A)(ii). For this reason, the appeal was timely and this Court has jurisdiction. III ¶8 Camacho raised two issues: (1) whether the trial court properly exercised its personal jurisdiction and (2) whether 7 CMC § 4210(c) exempts the Philippines townhouse from attachment. These are both questions of law, which we review de novo. Montecillo v. Di-All Chem. Co., 1998 MP 15 ¶ 2 (exercise of personal jurisdiction); Commonwealth v. Minto, 2011 MP 14 ¶ 33 (statutory construction). IV A. Authority Under In Personam Jurisdiction ¶9 First, we consider whether the trial court, which had in personam jurisdiction over Camacho,2 could order her to transfer real property situated in a foreign country. The exercise of personal jurisdiction is a question of law reviewed de novo. Montecillo, 1998 MP 15 ¶ 2. ¶ 10 Under the Restatement (Second) of Conflict of Laws,3 the general rule is that “[a] state has power to exercise judicial jurisdiction to order a person, who is subject to its judicial jurisdiction, to do, or not to do, an act in the state, although the carrying out of the decree may affect a thing in another state.” Restatement (Second) of Conflict of Laws § 55 (1971). The rule permits courts to compel a defendant to turn over real property located outside the court’s state to a plaintiff. Id. cmt. a. ¶ 11 Similarly, the common law mirrors the Restatement rule, concurring that courts may order a party it has personal jurisdiction over “to cease or perform acts outside its territorial jurisdiction.” Steele v. Bulova Watch Co., 344 U.S. 280, 289 (1952). Following this rule, courts with personal jurisdiction over 2 Camacho does not dispute that the trial court had personal jurisdiction over her. We note, however, that even if she contested personal jurisdiction, she nonetheless possesses sufficient contacts as a longtime resident and business owner in Saipan to satisfy both the Commonwealth’s long-arm statute and constitutional due process. 7 CMC § 1102; Shaffer v. Heitner, 433 U.S. 186, 212 (1977) (extending the “minimum contacts” test to all state-court assertions of personal jurisdiction), and Int’l Shoe Co. v. Washington), 326 U.S. 310, 316 (1945) (“[D]ue process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory, he have certain minimum contacts with it such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’”) (quoting Miliken v. Meyer, 311 U.S. 457, 463 (1940)). 3 In this case, the Commonwealth does not have written law addressing whether Commonwealth courts with personal jurisdiction can order a conveyance of real property in a foreign country. We therefore turn to the Restatements of Law. 7 CMC § 3401.  parties have ordered them to convey real property located in foreign countries. In Schaheen v. Schaheen, 169 N.W.2d 117 (Mich. Ct. App. 1969), for example, a Michigan appellate court held the trial court properly used its contempt powers during divorce proceedings to require a husband to convey property in Beirut, Lebanon to his spouse. Id. at 118. Likewise, in Brady v. Brown, 51 F.3d 810 (9th Cir. 1995), the court held because the district court had personal jurisdiction over the defendants, it could require defendants to execute a power of attorney transferring interests in Mexican land into a trust. Id. at 819. ¶ 12 Courts have also placed constructive trusts on real property located in other jurisdictions and then ordered the trustee to convey the property. In Matarese v. Calise, 305 A.2d 112 (R.I. 1973), for instance, a Rhode Island trial court imposed a constructive trust for the benefit of the plaintiff on property owned by the defendant in Italy due to defendant’s fraud. Id. at 116. It then ordered the defendant to convey that particular real property to the plaintiff. Id. The Rhode Island Supreme Court affirmed the trial court, stating, “the court had jurisdiction over the person of defendant and, therefore, had power to order a conveyance even though the land was situated outside the territorial limits of [Rhode Island].” Id. at 117 (citing Fall v. Eastin, 215 U.S. 1, 11-12 (1909)). ¶ 13 The trial court had personal jurisdiction over Camacho and directed her to perform an act (conveying title to her Philippine townhouse) within the Commonwealth. That the trial court’s decree affected property in another state or foreign country does not matter in light of the Restatement rule. We, therefore, hold that the trial court did not err when it compelled Camacho to convey real property in the Philippines to satisfy a judgment. B. Statutory Property Exemption ¶ 14 Having determined that the trial court had the authority to order Camacho to transfer title, we turn to the interpretation of 7 CMC § 4210(c). Camacho claims the statute permits courts to order a person to sell or transfer any interest in land, except for any interest the judgment debtor solely owns.4 We review questions of statutory construction de novo. Minto, 2011 MP 14 ¶ 33. ¶ 15 When construing a statute, we give the statute its “plain meaning, where the meaning is clear and unambiguous.” Calvo v. N. Mariana Islands Scholarship Advisory Bd., 2009 MP 2 ¶ 21 (quoting Aguon v. Marianas Pub. Land Corp., 2001 MP 4 ¶ 30). When a statute is not clear, however, we look at the statute as a whole, not just an isolated set of words, to ascertain the legislature’s intent. Id. at ¶ 22. We likewise avoid reading a statute in a way that defies common sense or leads to absurd results. Minto, 2011 MP 14 ¶ 34 (quoting Commonwealth Ports Auth. v. Hakubotan Saipan Enters., 2 NMI 212, 21 (1991)). The statutory provision at issue reads in relevant part: 4 Before ordering parties to sell or transfer land under an order of aid of judgment, we note that trial courts must also: (1) conclude that justice requires the order and (2) find as a fact—following analysis—that judgment debtors would have sufficient remaining land to support both themselves and their dependents. 7 CMC § 4210(c).  All interests in land, but any interest owned solely by a judgment debtor, in his or her own right, may be ordered sold or transferred under an order in aid of judgment if the court making the order deems that justice so requires and finds as a fact that after the sale or transfer, the debtor will have sufficient land remaining to support himself or herself and those persons directly dependent on the debtor according to recognized local custom and the law of the Commonwealth. 7 CMC § 4210(c). Camacho construes the foregoing to mean: “[a]ll interests in land, [except for] any interest owned solely by a judgment debtor, in his or her own right, may be ordered sold or transferred.” Id. ¶ 16 We do not adopt this construction because it would lead to absurd results. For example, Camacho’s construction would not protect married couples or people who share ownership with a debtor, even if that debtor also owned separate property solely in his or her own right. It defies common sense to believe that the legislature intended to exclude married persons from the provision’s protection. It also stretches logic to suggest that the legislature meant to single out people who share ownership of property with a debtor when that debtor owns other property solely in his or her own right. ¶ 17 Instead, the parallel construction in 7 CMC § 4210 as a whole and the comma usage in 7 CMC § 4210(c) in particular indicate that the provision exempts from attachment and execution all interests in land except for any interest solely owned by judgment debtors in their own right. Subsection (a) exempts “[a]ll necessary” personal and household goods. Id § 4210(a). Subsection (b) exempts “[a]ll” necessities for trade or occupation. Id § 4210(b). And subsection (c) exempts “[a]ll interests in land,” before going on to list an exception for land owned solely by a judgment debtor. Id § 4210(c). By using the same form in each subsection, it appears the legislature intended to give each subsection the same effect. For subsections (a) and (b) that meant exempting the property listed. It follows then that the drafters also intended to exempt all interests in land unless that land is “owned solely by a judgment debtor.” Id. ¶ 18 The drafters’ comma usage in 7 CMC § 4210(c) also supports this interpretation. In the relevant sentence, the drafters used three commas, one after “[a]ll interests in land” and two to set off the nonrestrictive phrase “in his or her own right.” The two commas cabining “in his or her own right” set that phrase off as a nonrestrictive phrase,5 but do not modify any other words. On the other hand, the first comma contrasts “all interests in land” with “any interest owned solely by a judgment debtor, in his or her own right.” That contrast does not conclude at the end of “in his or own right.” Rather, it continues for the rest of the sentence. In other words, subsection (c)’s commas break the sentence into two parts: (1) all interests in land and (2) any interest owned solely by a judgment debtor, in his or her own right. The first part is exempted, the second part is not. Thus, we construe the first part of 7 CMC § 4210(c) to effectively 5 A nonrestrictive phrase is “one that could be taken out of the sentence without changing the essential meaning.” Bryan A. Garner, The Redbook: A Manual on Legal Style 6 (2nd Ed. 2006).  read: the following described property is exempt from attachment and execution: All interests in land. But any interest owned solely by a judgment debtor, in his or her own right, may be ordered sold or transferred under an order in aid of judgment . . . . ¶ 19 Our conclusion is further buttressed by looking generally at 7 CMC § 4210, which appears to be a homestead exemption.6 A homestead exemption (also known as a “homestead law”) is “[a] statute exempting a homestead from execution or judicial sale for debt, unless all owners . . . have jointly mortgaged the property or otherwise subjected it to creditors’ claims,” Black’s Law Dictionary 631 (9th ed., abr. 2010). Homestead exemptions seek to ensure that debtors and their families maintain minimal financial resources so they do not become wards of the state. Webb v. Trippett, 286 Cal. Rptr. 742, 744 (Cal. App. 1991); Pub. Health Trust of Dade Cnty v. Lopez, 531 So. 2d 946, 948 (Fla. 1988); In re Johnson, 880 F.2d 78, 83 (8th Cir. 1989). State courts have regularly ruled that homestead exemptions only protect property within the state’s territory.7 For example, a Texas court refused to extend its constitutionally created homestead exemption to Mississippi land: “[i]t is glaringly clear and unassailable that the Texas Constitution, revered as it is, does not govern Mississippi land.” Rider v. Rider, 887 S.W.2d 255, 260 (Tex. Ct. App. 1994). Courts also have consistently required debtors seeking protection under state homestead exemptions to live on the property. E.g., Stewart v. Bader, 907 A.2d 931, 943 (N.H. 2006) (“[O]ccupancy must be actual and physical in nature.”). ¶ 20 Several reasons support our conclusion. First, the statutory provision’s title is “Exemptions.” 7 CMC § 4210. Second, the statute follows the form of other states’ exemption laws by separately exempting “personal and household goods,” “necessities for trade or occupation,” and “land and interests in land.” See Richard M. Hynes, Anup Malani & Eric A. Posner, The Political Economy of Property Exemption Law, 47 J. Law & Econ. 19, 23 (2004) (noting that many states split up their exemptions into two categories: one for homesteads, the other for “[p]ersonal property exemptions[, which] often refer to categories of basic necessities, like food, clothes, furnishings or tools of trade.”). Third, the purpose of the 6 We note the trial court also suggested 7 CMC § 4210(c) is a homestead exemption. Seizure Order at 3 (citing In re Drenttel, 302 B.R. 26 (D.Minn. 2003), rev’d, 309 B.R. 320, 327 (B.A.P. 8th Cir. 2004); In re Peters, 91 B.R. 401, 403 (W.D. Tex. 1988)). 7 See, e.g., Ferneau v. Armour & Co., 303 S.W.2d 161, 167 (Mo. Ct. App. 1957); Goodwin v. Claytor, 49 S.E. 173, 174 (N.C. 1904); State ex rel. Lankford v. Collins, 174 P. 568, 570 (Okla. 1918); Carson v. Memphis & C.R. Co., 13 S.W. 588, 589 (Tenn. 1890); Bergman v. Bergman, 888 S.W.2d 580, 582 (Tex. App. 1994); Strawn Mercantile Co. v. First Nat’l Bank of Strawn, 279 S.W. 473, 474 (Tex. App. 1925); S. Pac. Co. v. I.X.L. Furniture & Carpet Installment House, 140 P. 665, 666 (Utah 1914). But a number of federal bankruptcy courts have applied homestead exemptions across state lines. See, e.g., In re Arrol, 207 B.R. 662 (Bankr. N.D. Cal. 1997) (noting that while “the general rule . . . [is that] state homestead laws have no extraterritorial force,” the general rule does not apply to issues governed by the federal bankruptcy code); In re Drentell, 309 B.R. 320, 327 (B.A.P. 8th Cir. 2004) (writing that in the bankruptcy context, when a person moves from one state to another, there is nothing in the [federal Bankruptcy] Code to suggest that Congress intended to deprive debtors of the homestead exemption . . . . Indeed, the strong federal interest expressed in the Code requires that debtors be allowed to avail themselves of the exemptions provided by the forum state.”).  provision parallels the rationale of the homestead exemption, which is to prevent debtors from becoming dependent on public benefits because they lost a judgment. In our statute, subsection (a) exempts necessary household goods like “cooking and eating utensils, and all necessary wearing apparel, bedding, and provisions for household use sufficient for four months.” 7 CMC § 4210(a). Subsection (b) exempts “necessities for trade or occupation,” including “[a]ll tools, implements, utensils, two work animals, and equipment necessary . . . to carry on his or her occupation.” Id. § 4210(b) (emphasis added). And subsection (c) exempts land a debtor needs “to support himself or herself and those persons directly dependent on the debtor.” Id. § 4210(c). In each case, the legislature exempted property necessary for the debtor to make a living sufficient to keep them from becoming wards of the state. C. Seizure Order ¶ 21 Finding the trial court had the authority to compel Camacho to convey her townhouse in the Philippines, which was not exempted by 7 CMC § 4210(c), we consider whether the trial court properly fashioned the Seizure Order. ¶ 22 Orders relating to land usually must comply with the laws governing conveyances in the jurisdiction where the property is located. See Restatement (Second) of Conflict of Laws § 223 (1971); see also id. at cmt. d (commenting that in cases conveying land, courts should apply the conveyance laws, such as who may be a transferee, of the place where the land sits). The Philippines restricts land ownership to Philippine citizens and certain others of Filipino descent.8 For example, article XII, section 7 of the 1987 Constitution of the Republic of the Philippines states, “no private lands shall be transferred or conveyed except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain.” Const. (1987), art. XII, sec. 7 (Phil.). Similarly, article XII, sections 2 and 3 limit lands in the public domain to Filipino citizens, or to companies or associations where “at least sixty per centum of whose capital is owned by [Filipino] citizens.” Const. (1987), art. XII, secs. 2, 3 (Phil.). ¶ 23 Here, the Seizure Order does not appear to have considered Philippine conveyance laws. The trial court granted the Plaintiffs’ motion for the seizure of real property pursuant to an order in aid of judgment. Seizure Order at 3. In the granted motion, Plaintiffs “requested that the Court order Defendant Bienvenida Camacho to deed over her townhouse to the Law Offices of S. Joshua Berger within thirty days from the date of the Court’s Order.” ER at 25. It is unclear from the record before us whether the Law Offices of S. Joshua Berger falls within one of the categories constitutionally eligible to hold land in the Philippines. Because the Seizure Order made no findings regarding eligibility per the Philippine Constitution to hold land in ordering the transfer of the townhouse, it is defective and must be vacated. V 8 We take judicial notice of the Philippine Constitution pursuant to NMI Rule of Evidence 201(b)(2) and NMI Rule of Civil Procedure 44.1. ¶ 24 For the reasons stated above, we AFFIRM the trial court’s finding that it could order Camacho to convey real property in the Philippines to satisfy a judgment, but VACATE the Seizure Order and REMAND for further proceedings consistent with this opinion. SO ORDERED this 31st day of December 2012. /s/ ALEXANDRO C. CASTRO Chief Justice /s/ JOHN A. MANGLONA Associate Justice