High Court issues ruling in Estate of Ogumoro v. Ko

The CNMI Supreme Court issued Wednesday a ruling in Estate of Ogumoro v. Ko, addressing various arguments raised by Han Yoon Ko and Jung Boo Jung concerning a 55-year lease on real property located at the intersection of Chalan Palé Arnold and Chalan Monsignor Guerrero in San Jose, Saipan.

The issues over the leased property began when Soledad T. Ogumoro leased her property to Suk Kon Jo and Jun Duk Soon Jo in 1994. The Jos obtained a mortgage from Han Yoon Ko, who later foreclosed on the mortgage in 1997. Ko then purchased the Jos’ leasehold interest at a foreclosure sale, but neither Ko nor the Jos informed Ogumoro that Ko was the new lessee. In 1999, believing that the Jos were still the lessee, Ogumoro sought to terminate the lease. She sued the Jos in Superior Court, discovered that Ko was the actual lessee, and added him to the case. Ogumoro obtained a default judgment against Ko in 2001 terminating the leasehold for failure to pay rent.

Later in 2001, Ogumoro re-leased her property to Jung Boo Jung. Jung improved the property, then subleased the property to several companies. In 2003, Ko learned about the default judgment terminating his leasehold interest. The trial court granted Ko’s request to set aside the default judgment, which resulted in Ko, once again, having an interest in the property. Sometime later, Ko filed a quiet title action against Jung and Jung’s sublessees, alleging that he was entitled to possession of the leased property.

In 2006 the trial court issued several orders finding that Ogumoro had properly terminated the lease between herself and Ko. The trial court based this conclusion on provisions in the original lease agreement between Ogumoro and the Jos, believing that these provisions were applicable to Ko. In 2007, the trial court further relied on these lease provisions to conclude that Ko was liable for attorney fees, unpaid rent, and lost rent.

On appeal, the Supreme Court reversed the trial court. The Supreme Court held that Ko was not liable to Ogumoro under the terms of the lease agreement signed by Ogumoro and Ko because Ko did not sign the agreement or otherwise agree to be bound by the lease terms. The Supreme Court also found that Ko was not liable for attorney fees or lost rents. Moreover, the Supreme Court determined that Ogumoro had not properly terminated Ko’s interest in the leased property. Finally, the Supreme Court determined that the trial court should hold further proceedings to determine whether Ogumoro had properly terminated Ko’s lease, and if not, to determine whether Ko’s absence from the leased property and his subsequent failure to pay rent for several years amounted to legal abandonment of the lease.

The Supreme Court’s full opinion is Estate of Ogumoro v. Ko, 2011 MP 11, and can be found at http://www.cnmilaw.org/supreme_11.htm.