February 06, 2008

The Kaselehlie Press

Palikir, Pohnpei - For several years Pohnpei Port Authority has been trying to collect payment from Pohnpei Marine Services for fees they say are owed to them. PMS is a sole proprietorship business owned by Timakio Ehsa. The company serves as a ship's agent and makes its living by charging vessels who utlilize their services.

All ships that enter the port must have an agent to handle their fees and the logistical details while they are in port. PMS pays for port fees and other details and then charges the ship's owner for its services.

Over the years, PMS has filed multiple law suits against the Port saying that PPA has denied entry to the port for some of its clients. PPA says that while they have delayed entry for some vessels whose accounts were delinquent they have not denied entry to the Port to any of PMS's clients. PMS through its attorneys over the history of their court struggles has asserted that PPA's heavy handed enforcement of a rule that says that port entry fees must be paid within 30 days has nearly driven them out of business. It has said in the past that it cannot reasonably collect the money due to it from its clients within 30 days and they should not be charged interest for overdue fees.

The situation has seen PMS and PPA in court both on the State and National levels many times since it first began.

On January 2, 2008, however PMS stipulated to an agreement that said that it would pay $100,000 of what it owed by January 15. The remaining balance would be paid within 30 days of the first payment. They were to have made the payment by personal delivery to PPA's finance division in Dekehtik, Pohnpei. Interest on the debt was to continue to accrue at 9% according to FSM Supreme Court Justice Andon Amaraich's Order Vacating a Hearing date on the matter.

On the 16th of January when they had not received a payment, PPA filed at The Supreme Court a notice of non-compliance with the court order that reflected PMS' stiplulation. They requested that the Court "schedule a hearing at which Mr. Ehsa will be required to show cause why he should not be held in civil contempt of court and punished accordingly, including imprisonment if necessary, until all money due is paid in full."

Marstella Jack, acting as attorney for PMS filed a motion on January 28 to enlarge the amount of time for her client to respond. She said in her motion that between November 2007 to the 23rd of January PMS paid the port nearly $240,000. She said that her client needed time to determine whether any of those payments cleared the debt and that it would be a waste of the Court's time to have parties appear for a contempt hearing if in fact the debt had already been cleared.

PPA's lawyer, Mike Sipos filed three days later an opposition to Jack's motion. In his opposition argument he said that PMS has ongoing business with the Port, that they regularly average $100,000 per month in fees due to the port and the payments were for the ongoing charges. His argument said, "The bottom line in all of this is that PMS has allowed its indebtedness to PPA to linger in the $500,000 to $1 million range for some three years now and it is without dispute that Ehsa and PMS have violated the court's order requiring payment of $100,000 by January 15, 2008. Thus there is no grounds to enlarge time on any basis such that the court should deny that motion and set this matter for the requested hearing without further delay."

He attached to the motion a copy of a subsidiary ledger showing transactions since April 10, 2007 that he says shows that PMS has made no payment on the stipulated judgment.

Along with the request for an order to show cause, Sipos filed thousands of pages of financial documentation to demonstrate that PMS's contention that they could not afford to pay was untrue. He said that he had not filed the items which he obtained by court order from PMS and by a subpoena of bank records because PMS had stipulated to an agreement and that the filing was unnecessary.

Defaulting on the stipulation made it necessary to file all of the discovery documents. According to the summary of the discovery documents filed with PPA's request for an order to show cause, PMS has deposited over $15 million into its bank account since 2004. The summary documents don't show cash withdrawals, expenses but does show a summary of invoiced receivables at least for the last three years.

The summary shows invoiced receivables of over $2.5 million during the same period of time that the company had deposited over $11 million into their bank account. There may be a perfectly logical reason for that disparity. PPA says essentially that it only shows them that PMS can afford to pay their fees.

PPA in its filing said, "To assist the court in understanding PMS's financial condition and to establish the judgment debtor's apparent economic well being in contradiction to the assertions repeatedly made in this and several other parallel cases previously pending between these parties, PPA is concurrently filing the financial records produced during postjudgment discover in this action."

At press time, no ruling had yet been issued on PMS's request for enlargement of time for a hearing on the contempt issue.