Ad Litem NMI Fund Trustee’s Compensation Criticized
By Alexie Villegas Zotomayor
SAIPAN, CNMI (Marianas Variety, Nov. 16, 2012) – The Office of the Attorney General believes that the court erred in requiring the Commonwealth of the Northern Mariana Islands government to pay the trustee ad litem’s fees and approving the "unreasonable" compensation rates.
In a reply to the Fund’s opposition to the government’s motion for reconsideration and objections to trustee ad litem’s request for compensation, Assistant Attorney General and chief of civil division Gil Birnbrich asked the court to reconsider its orders to relieve the government of its obligation to pay the trustee ad litem and reduce the trustee’s compensation rates.
He reiterated the argument he used in his reply to plaintiff Betty Johnson’s opposition that the court has an inherent authority to reconsider its interlocutory orders on the remuneration for the trustee ad litem.
In response to the Fund’s opposition to the government’s motion, Birnbrich said the Fund does not cite a single case that supports the current compensation scheme.
He said that reliance on the Guam Ordot case and the Superior Court case is misplaced because neither the Guam nor the Superior Court judgment provides a legal basis for the court to require the government to pay the trustee ad litem’s fees and the Fund’s attorneys’ fees.
He asked that if the court declined to reconsider and modify its orders, it should (1) unseal the trustee ad litem and the Fund’s attrorneys’ detailed billing statements and require that all detailed billing statements be filed without seal; (2) should not require the government to pay the Fund’s attorneys’ fees; and (3) relieve attorney Daniel Berman as counsel for the Fund.
Berman is representing the Fund in the Betty Johnson case pro hac vice.
Birnbrich maintains that reconsideration of the court orders is warranted under the court’s inherent power to reconsider its interlocutory orders.
He said that the court should not rely solely on Rule 54 (b) of the Federal Rules of Civil Procedure.
He said "because a district court’s authority over its interlocutory orders ultimately derives from the common law, it is not abridged by the Federal Rules of Civil Procedure."
Birnbrich said that such power is "plenary power" to be "exercised in justice and good conscience."
Refuting the Fund’s claim that the government has not met the standard under Rule 60(b), Birnbrich said the court’s power to reconsider interlocutory orders is not only a function of the Federal Rules of Civil Procedure.
He also denied that the government merely renews old arguments, fails to demonstrate clear error or manifests injustice, and fails to cite an intervening change in law.
He said the government did not have the opportunity to brief the issue regarding who will bear the costs of the trustee ad litem in the first instance.
The payment scheme, he added, is a manifest error of law.
He said that it is "manifestly unjust" to require the government to pay for the trustee ad litem.
He said the government, the defendant, has not been found liable of any wrongdoing in the Betty Johnson case and the government did not request the appointment of the trustee ad litem.
"Requiring such would be akin to ordering a defendant to pay a plaintiff’s attorney’s fees before the merits of the case were decided," he said.
He also explained that neither the Guam Ordot Dump case nor the Superior Court judgment support the current payment scheme.
He said the payment scheme adopted in the Guam Ordot case does not apply.
He said there was a legal basis for the court to impose costs of the receiver on the Government of Guam because it failed to comply with the consent decree for over four years and the court had to invoke its equity jurisdiction to appoint a receiver.
He said this is not similar to the CNMI case where the instant case is still in early stages of litigation and there is no final judgment yet that finds the government liable to the plaintiff.
Birnbrich said that absent a final judgment, the court does not have the authority it had in the Guam case to require the government to pay the trustee ad litem.
He pointed out the absence of a consent decree or final judgment in the Betty Johnson case.
As to the use of the Superior Court judgment as a basis, he said that the federal court does not have the authority to enforce the Superior Court judgment.
"If the court were to justify the payment scheme by setting off the fees against the Superior Court judgment, it would essentially amount to enforcing and aiding in the collection of another court’s judgment — a situation that would be in error of law," he said.
He added that the finality of the Superior Court judgment remains in dispute.
He also said that the trustee ad litem’s rate of compensation is unreasonable.
Birnbirch also refuted the Fund’s arguments in favor of the trustee’s compensation.
He said the Guam receiver’s rate should not apply because the Fund is not in a receivership and the trustee ad litem’s duties are not as "expansive" as those of the receiver.
The trustee’s legal experience should not impact the compensation rate because a trustee ad litem’s job is neither to render legal advice nor to litigate cases.
The Fund’s current litigation load and administrative docket do not affect the compensation rate, he said.
Although the trustee would be engaged in other aspects of the Fund’s business, Birnbrich said that this does not warrant "greater compensation."
He asked that the trustee ad litem be required to file detailed billing statements.
Birnbirch said Civille and Tang PLLC and its principal representative Joseph C. Razzano are not giving legal advice to the Fund but are serving as the Fund’s board of trustees.
The attorney-client privilege does not apply just because the trustee ad litem happens to be a group of lawyers.
He said the billing statements should not be filed under seal to allow parties to review if the services were within the limited scope of the trustee ad litem’s duties.
Birnbirch, citing a Ninth Circuit decision, said that the Fund’s legal counsels’ billing statements are not protected from disclosure by the attorney-client privilege.
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