MPLA sued to block$3.45M payout

To prevent the drawdown of some $3.45 million in land compensation for the claim of the Malite estate, the Attorney General’s Office sued the Marianas Public Lands Authority and its board members Friday in a complaint that seeks to prevent the release of the funds.

Attorney general Pamela Brown, represented by her office’s civil division chief, Benjamin Sachs, told the Superior Court that there are circumstances surrounding the transaction that create a “strong appearance of ethical impropriety and conflicts of interest.”

The MPLA board approved the land claim, a matter that was already decided by the Trust Territory court in 1978. That court determined the compensation for condemnation of a parcel of land, which now forms part of the Marianas High School, in the amount of $3,682. The Commonwealth government obtained title to the land as a result of the condemnation.

The suit impleaded MPLA board chair Ana Demapan-Castro and members Nicolas Nekai, Felix Sasamoto, Manny Villagomez, and Benita Atalig-Manglona, as well as MPLA acting commissioner Edward DeLeon Guerrero, the Commonwealth Development Authority, and Jesus Tudela, the administrator of the Malite estate.

Sachs said the AGO had to file the lawsuit after the MPLA recently announced that some $3.45 million would be disbursed to the Malite estate on Dec. 6—yesterday—despite the AGO’s objections. The CDA reportedly agreed to the release of the land claim. Sachs asked the court for a temporary restraining order to prevent the consummation of the release of funds, but Superior Court judge Juan T. Lizama has yet to rule on the request after a hearing yesterday.

Sachs is questioning the amount of $3.45 million, approximately 1,000 times larger than the compensation determined in the 1978 Trust Territory court order, a final judgment in which no appeal was taken.

“Because the judgment entered in 1978 is presumed to have been satisfied and is barred by the statute of limitations, this disbursement serves no public purpose and instead is purely gratuitous,” Sachs said.

Even if the Trust Territory court judgment may not have been actually satisfied, the amount of $3.45 million does not conform to valuation provisions of the law, with Sachs saying that valuation of condemned land should be determined at the time of the taking of the property by the Commonwealth government.

He said the lawyer of the estate’s administrator, Antonio Atalig, presented an appraisal report, which used Aug. 30, 1991 as the time of the taking. The appraisal pegged the value of the concerned property at $500 per square meter.

The appraisal report was met with questions during the MPLA board meeting on June 30, 2004, according to Sachs, saying that MPLA’s appraisal reviewer indicated problems with the report. He said the appraisal reviewer, Mitch Aaron, questioned why 1991 was used as the time of taking.

“MPLA legal counsel Alan Lane addressed the board on Aug. 13, 2004, and made a recommendation that the MPLA staff be allowed to continue to investigate the matter, and secure a new appraisal. He also suggested the possibilities of the Office of the Attorney General bringing a new condemnation case, paying interest of the TT High Court’s judgment at the rate of 9 percent per annum since 1978, etc.,” Sachs said.

“However, defendant Demapan-Castro insisted that there was no time left to investigate further, the Malite heirs were ready to go to court, and the MPLA board should decide immediately,” he said. “Consequently, the MPLA board rushed to a decision on the matter—ultimately voting in favor of paying $3.45 million for the land compensation claim.”

The assistant attorney general said the MPLA board made an independent determination that the Malite estate still has a land compensation claim despite the CNMI government’s title to the land since 1978. Pursuant to the board decision, MPLA’s acting commissioner proceeded to make a requisition for the land compensation claim, asking the CDA to release the money.

The CDA had held off releasing the funds upon objection by the AGO. On Nov. 29, Sachs disclosed that a meeting was held at the Governor’s Office to resolve the dispute. During that meeting, the MPLA announced that the claim would be released to the estate’s administrator on Dec. 6.

‘Conflicts of interest’

Sachs said there are conflicts of interest between the Maliti heirs’ lawyers and some MPLA board members, which taint the transaction.

Besides Antonio Atalig, who acts as lawyer for the estate’s administrator, Pedro Atalig, a former member of the MPLA board, is lawyer for some or all of the Malite heirs, according to Sachs.

According to Sachs, MPLA legal counsel Raymond Quichocho shares an office with Pedro Atalig, whose office manager, Juan Demapan, is brother of the MPLA chair. He also said the Atalig lawyers are brothers to MPLA board member Atalig-Manglona, who voted in favor of the release of the compensation.

“Defendant Atalig-Manglona voted…and must have known that her brother, Antonio Atalig, would derive a substantial contingency fee as the result of the drawdown and disbursement of $3.45 million for the land compensation claim he asserted on behalf of the estate of Angel Malite,” the assistant attorney general said.

Sachs also questioned the requisition signed by the acting commissioner, DeLeon Guerrero, amid challenges to his legitimacy as MPLA commissioner. The Land Compensation Act of 2002 requires the MPLA commissioner to sign all requisitions for land compensation payments.

He noted that Henry Hofschneider, who was earlier terminated by the MPLA chair from the post of commissioner, claims that he remains commissioner. He also questioned the termination of Hofschneider by Demapan-Castro, saying that the action was done without a proper board meeting.

“Defendants’ threat to draw down and disburse $3.45 million from the Land Compensation Fund for a spurious land compensation claim is beyond defendants’ powers and authority, and a breach of their fiduciary duties to the plaintiff [CNMI government], thereby warranting the issuance of a writ of mandamus or prohibition,” Sachs said.

A court issues a writ of mandamus to an official to compel performance of fiduciary duty, while prohibition prevents a tribunal from exercising jurisdiction. Sachs did not file an administrative appeal before the MPLA.