1 I Lll IN THE SUPERIOR COURT OF GUAM 2
3 ARTHUR M. P AGUIO, ) DOMESTIC CASE NO. DM0816-06 4 ) Plaintiff, ) 5 ) ) FINDINGS OF FACT AND 6 ) CONCLUSIONS OF LAW vs. ) 7 ) ) 8 MARTINA E. PAGUIO, now known as ) ) LEVANAS, ) 10 ) Defendant. 11
13 This matter came before the HONORABLE VERNON P. PEREZ on April 19, 2013. 14 Attorney Phillip Torres, Esq. represented Plaintiff/Respondent Arthur M. Paguio ("Mr. Paguio"). 15 Attorney Peter C. Perez, Esq. represented Defendant/Movant Martina-Eva Timmerman-Levana 16 ("Movant"). Upon review of the evidence, oral and written arguments, and legal authoritie 17
18 presented by the parties, the Court hereby issues its Findings of Fact and Conclusions of Law.
19 FINDINGS OF FACT 20 By preponderance ofthe evidence, the Court makes the following findings of fact: 21 1. The Parties were married on October 3, 2003. 22 2. On July 2, 2007, the Parties entered into a Divorce and Property Settlemen 23
24 Agreement: and Consent to Divorce (hereinafter "Agreement").
25 3. Under that Agreement, Mr. Paguio was obligated to make mortgage payments on Ok
26 Towers, unit 411, where Movant then resided. 27
Paguio v. Paguio (DM0816-06) Page I of7 Findings of Fact and Conclusions of Law 4. Mr. Paguio failed to make payments on the mortgage for the months of Novembe 1
2 and December 2009.
3 5. Mr. Paguio again began making regular mortgage payments after Movant's counse 4 transmitted a letter to Mr. Paguio's counsel instructing him to do so. 5 6. In June 2011, BankPacific contacted Movant to inform her of past due mortgag 6 payments and that the bank would be foreclosing on the unit. Movant borrowe 7
8 money to cure the arrears, in the amount of$3,175.78.
9 7. Movant requested Order to Show Cause on July 6, 2011, which the Court signed an 10 filed on July 27, 2011. 11 8. On October 28, 2011, the Court issued a Decision and Order, in which Mr. Pagui 12 was not found in contempt, but was required to assume the remaining mortgag 13
14 payments on unit 411. 15 9. Movant borrowed money and made direct mortgage payments to BankPacifi 16 totaling $9,675.78. 17 10. Mr. Paguio did not make any payments pursuant to the Court's October 28, 2011 18
19 Decision and Order.
20 11. As a result, BankPacific issued a Notice of Sale Under Mortgage dated January 26 21 2012. 22 12. To avoid imminent foreclosure, Movant sold unit 411. 23 13. Unit 411 sold for $250,000. 24
25 14. Of the sale proceeds Movant spent $82,395 to pay off the outstanding balance on th
26 mortgage and $13,325 in settlement charges. 27
Paguio v. Paguio (DM0816-06) Page 2 of7 Findings of Fact and Conclusions of Law 15. As a result of his business suffering, Mr. Paguio entered into discussions with hi 1
2 bank regarding debt consolidation. See. Transcript at 2:52:30 p.m. on April 19, 2013.
3 16. The actual debt consolidation was entered into on October 21, 2011. !d. at 3:06:1 4 p.m. 5 17. Mr. Paguio was not under court order to consolidate all' of his debt. Instead he w 6 under court order to assume the mortgage payments on unit 411. 7
8 18. When negotiating his debt consolidation, Mr. Paguio could have included unit 411
9 but did not. !d. at 3:13:50 p.m. 10 19. As a result of the debt consolidation, Mr. Paguio' s two other properties (Unit 211 11 Oka Towers/ Unit 204, Villa Gi Papa Ladera) were encumbered at the time the Cou 12
13 issued its October 28, 2011 Decision and order. See. Pl.'s Ex. 6 & 7.
14 20. After the debt consolidation Mr. Paguio did not find success with his business. See.
15 Transcript at 2:54: 35 p.m. on April 19, 2013. 16 21. Mr. Paguio was without discretionary income and therefore unable to comply wit 17 the Court's order. !d. at 2:57:32 p.m. 18
19 22. No evidence has been presented to establish that Mr. Paguio' s debt consolidation an
20 the resultant inability to pay was the product of a willful failure to comply with th 21 court's order. 22 CONCLUSIONS OF LAW 23
24 I. CONTEMPT
25 The Court has addressed the issue of contempt in this matter once before. The elements
26 of a civil contempt action are: "1) a valid order, 2) knowledge of the order, 3) ability to comply 27 with the order, and 4) willful failure to comply with the order." Lamb v. Hoffman, 2008 Guam 28
Paguio v. Paguio (DM0816-06) Page 3 of7 Findings of Fact and Conclusions of Law 2, ~ 44(intemal citations omitted). In a civil action like divorce, Guam's contempt statute 1
2 provides that "[a]ny person found guilty of a contempt of court pursuant to §341 02(b) is subject
3 to the same penalties as a person found guilty of a petty misdemeanor." I d., citing, 7 Guam 4 Code. Ann. § 34101(b) (2005). Further, Section 80.34 of Title 9 of the Guam Code provides 5 that if a party is convicted of a petty misdemeanor, "the court shall set a definite term not to 6 exceed sixty (60) days." 9 Guam Code Ann. § 80.34(b) (2005). 7
8 Generally, in federal courts "the moving party has the initial burden of proving, by clear
9 and convincing evidence, that a valid court order existed, that the defendant had knowledge of 10 the order, and that the defendant disobeyed the order." US v. Ford, 514 F.3d 1047, 1051 (lOth 11 Cir. 2008); US v. Saccoccia, 354 f.3d 9, 14 (1st Cir. 2003)(in a civil contempt proceeding, 12
clear and convincing evidence would be required); Levin v. Tiber Holding Corp., 277 f.3d 243, 13
14 250 (2d Cir. 2002)(in the context of civil contempt, the clear and convincing standard requires a
15 quantum of proof adequate to demonstrate a "reasonable certainty" that a violation occurred). 16 The non-moving party in a civil contempt proceeding may assert as an affirmative 17 defense, their inability to comply with the order in question. US v. Rylander, 460 U.S. 752, 18
19 757 (1983). The Guam Supreme Court has held that the affirmative defense of inability must be
20 proven by a preponderance of the evidence. Rodriguez v. Rodriguez, 2003 Guam 8, ~ 18 (Sup. 21 Ct. Guam 2003). 22 In this case, the Court concludes that first two elements for civil contempt have been 23 satisfied. A valid Court order was entered into on Oct. 28, 2011, which required Mr. Paguio to 24
25 assume the entire mortgage for unit 411. 1 Mr. Paguio had knowledge of that order. With regard
27 1 The Court acknowledges the existence and validity of the underlying Divorce and Property Settlement Agreement.
However, the Court recognizes that a good-faith dispute arose out of the terms of that agreement, which this Co 28 then rectified in its October 28, 2011 Decision and Order. As a result of that litigation, the Court's contempt analysi pertains to the alleged failure to comply with the Court's October 28,2011 Decision and Order.
Paguio v. Paguio (DM0816-06) Page 4 of? Findings of Fact aod Conclusions of Law to the third element (ability to comply with the order), the Court concludes that the evidence is 1
2 insufficient to establish that Mr. Paguio had the ability to comply with the order. Movant
3 argued that Mr. Paguio owned other properties, which he could have liquidated in order to 4 comply with the order. See. Transcript at 2:35:30 p.m. on April 19, 2013. While the Court 5 accepts that Mr. Paguio could have done just that, the two other properties (Unit 211, Oka 6 Towers/ Unit 204, Villa Gi Papa Ladera) were encumbered through debt consolidation prior to 7
8 entry of this Court's order. Furthermore, Mr. Paguio' s testimony indicated that, as a result of
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1 I Lll IN THE SUPERIOR COURT OF GUAM 2
3 ARTHUR M. P AGUIO, ) DOMESTIC CASE NO. DM0816-06 4 ) Plaintiff, ) 5 ) ) FINDINGS OF FACT AND 6 ) CONCLUSIONS OF LAW vs. ) 7 ) ) 8 MARTINA E. PAGUIO, now known as ) ) LEVANAS, ) 10 ) Defendant. 11
13 This matter came before the HONORABLE VERNON P. PEREZ on April 19, 2013. 14 Attorney Phillip Torres, Esq. represented Plaintiff/Respondent Arthur M. Paguio ("Mr. Paguio"). 15 Attorney Peter C. Perez, Esq. represented Defendant/Movant Martina-Eva Timmerman-Levana 16 ("Movant"). Upon review of the evidence, oral and written arguments, and legal authoritie 17
18 presented by the parties, the Court hereby issues its Findings of Fact and Conclusions of Law.
19 FINDINGS OF FACT 20 By preponderance ofthe evidence, the Court makes the following findings of fact: 21 1. The Parties were married on October 3, 2003. 22 2. On July 2, 2007, the Parties entered into a Divorce and Property Settlemen 23
24 Agreement: and Consent to Divorce (hereinafter "Agreement").
25 3. Under that Agreement, Mr. Paguio was obligated to make mortgage payments on Ok
26 Towers, unit 411, where Movant then resided. 27
Paguio v. Paguio (DM0816-06) Page I of7 Findings of Fact and Conclusions of Law 4. Mr. Paguio failed to make payments on the mortgage for the months of Novembe 1
2 and December 2009.
3 5. Mr. Paguio again began making regular mortgage payments after Movant's counse 4 transmitted a letter to Mr. Paguio's counsel instructing him to do so. 5 6. In June 2011, BankPacific contacted Movant to inform her of past due mortgag 6 payments and that the bank would be foreclosing on the unit. Movant borrowe 7
8 money to cure the arrears, in the amount of$3,175.78.
9 7. Movant requested Order to Show Cause on July 6, 2011, which the Court signed an 10 filed on July 27, 2011. 11 8. On October 28, 2011, the Court issued a Decision and Order, in which Mr. Pagui 12 was not found in contempt, but was required to assume the remaining mortgag 13
14 payments on unit 411. 15 9. Movant borrowed money and made direct mortgage payments to BankPacifi 16 totaling $9,675.78. 17 10. Mr. Paguio did not make any payments pursuant to the Court's October 28, 2011 18
19 Decision and Order.
20 11. As a result, BankPacific issued a Notice of Sale Under Mortgage dated January 26 21 2012. 22 12. To avoid imminent foreclosure, Movant sold unit 411. 23 13. Unit 411 sold for $250,000. 24
25 14. Of the sale proceeds Movant spent $82,395 to pay off the outstanding balance on th
26 mortgage and $13,325 in settlement charges. 27
Paguio v. Paguio (DM0816-06) Page 2 of7 Findings of Fact and Conclusions of Law 15. As a result of his business suffering, Mr. Paguio entered into discussions with hi 1
2 bank regarding debt consolidation. See. Transcript at 2:52:30 p.m. on April 19, 2013.
3 16. The actual debt consolidation was entered into on October 21, 2011. !d. at 3:06:1 4 p.m. 5 17. Mr. Paguio was not under court order to consolidate all' of his debt. Instead he w 6 under court order to assume the mortgage payments on unit 411. 7
8 18. When negotiating his debt consolidation, Mr. Paguio could have included unit 411
9 but did not. !d. at 3:13:50 p.m. 10 19. As a result of the debt consolidation, Mr. Paguio' s two other properties (Unit 211 11 Oka Towers/ Unit 204, Villa Gi Papa Ladera) were encumbered at the time the Cou 12
13 issued its October 28, 2011 Decision and order. See. Pl.'s Ex. 6 & 7.
14 20. After the debt consolidation Mr. Paguio did not find success with his business. See.
15 Transcript at 2:54: 35 p.m. on April 19, 2013. 16 21. Mr. Paguio was without discretionary income and therefore unable to comply wit 17 the Court's order. !d. at 2:57:32 p.m. 18
19 22. No evidence has been presented to establish that Mr. Paguio' s debt consolidation an
20 the resultant inability to pay was the product of a willful failure to comply with th 21 court's order. 22 CONCLUSIONS OF LAW 23
24 I. CONTEMPT
25 The Court has addressed the issue of contempt in this matter once before. The elements
26 of a civil contempt action are: "1) a valid order, 2) knowledge of the order, 3) ability to comply 27 with the order, and 4) willful failure to comply with the order." Lamb v. Hoffman, 2008 Guam 28
Paguio v. Paguio (DM0816-06) Page 3 of7 Findings of Fact and Conclusions of Law 2, ~ 44(intemal citations omitted). In a civil action like divorce, Guam's contempt statute 1
2 provides that "[a]ny person found guilty of a contempt of court pursuant to §341 02(b) is subject
3 to the same penalties as a person found guilty of a petty misdemeanor." I d., citing, 7 Guam 4 Code. Ann. § 34101(b) (2005). Further, Section 80.34 of Title 9 of the Guam Code provides 5 that if a party is convicted of a petty misdemeanor, "the court shall set a definite term not to 6 exceed sixty (60) days." 9 Guam Code Ann. § 80.34(b) (2005). 7
8 Generally, in federal courts "the moving party has the initial burden of proving, by clear
9 and convincing evidence, that a valid court order existed, that the defendant had knowledge of 10 the order, and that the defendant disobeyed the order." US v. Ford, 514 F.3d 1047, 1051 (lOth 11 Cir. 2008); US v. Saccoccia, 354 f.3d 9, 14 (1st Cir. 2003)(in a civil contempt proceeding, 12
clear and convincing evidence would be required); Levin v. Tiber Holding Corp., 277 f.3d 243, 13
14 250 (2d Cir. 2002)(in the context of civil contempt, the clear and convincing standard requires a
15 quantum of proof adequate to demonstrate a "reasonable certainty" that a violation occurred). 16 The non-moving party in a civil contempt proceeding may assert as an affirmative 17 defense, their inability to comply with the order in question. US v. Rylander, 460 U.S. 752, 18
19 757 (1983). The Guam Supreme Court has held that the affirmative defense of inability must be
20 proven by a preponderance of the evidence. Rodriguez v. Rodriguez, 2003 Guam 8, ~ 18 (Sup. 21 Ct. Guam 2003). 22 In this case, the Court concludes that first two elements for civil contempt have been 23 satisfied. A valid Court order was entered into on Oct. 28, 2011, which required Mr. Paguio to 24
25 assume the entire mortgage for unit 411. 1 Mr. Paguio had knowledge of that order. With regard
27 1 The Court acknowledges the existence and validity of the underlying Divorce and Property Settlement Agreement.
However, the Court recognizes that a good-faith dispute arose out of the terms of that agreement, which this Co 28 then rectified in its October 28, 2011 Decision and Order. As a result of that litigation, the Court's contempt analysi pertains to the alleged failure to comply with the Court's October 28,2011 Decision and Order.
Paguio v. Paguio (DM0816-06) Page 4 of? Findings of Fact aod Conclusions of Law to the third element (ability to comply with the order), the Court concludes that the evidence is 1
2 insufficient to establish that Mr. Paguio had the ability to comply with the order. Movant
3 argued that Mr. Paguio owned other properties, which he could have liquidated in order to 4 comply with the order. See. Transcript at 2:35:30 p.m. on April 19, 2013. While the Court 5 accepts that Mr. Paguio could have done just that, the two other properties (Unit 211, Oka 6 Towers/ Unit 204, Villa Gi Papa Ladera) were encumbered through debt consolidation prior to 7
8 entry of this Court's order. Furthermore, Mr. Paguio' s testimony indicated that, as a result of
9 his business suffering and the debt consolidation, he was without discretionary income at the 10 end of the month. !d. at 2:57:30 p.m. Therefore, the Court is not persuaded that Mr. Paguio had 11 the ability to comply with the order. 12 Even if the Court were to find the evidence sufficient to establish Mr. Paguio's ability to 13
14 comply with the order, the Court cannot conclude that the final element of contempt has been
15 satisfied-that Mr. Paguio willfully failed to comply with the order. At the order to show cause 16 hearing, Mr. Paguio testified that although he could have included unit 411 in his debt 17 consolidation (in place of his other properties), negotiations with the bank and the actual 18
19 execution of the debt consolidation were entered into prior to this Court's October 28, 2011
20 Decision and Order. !d. 3:06:10 p.m. No evidence has been presented to establish that Mr. 21 Paguio willfully excluded unit 411 in order to avoid compliance with the Court's order. Thus, 22 the fourth element of contempt has not been satisfied. The Court will not hold Mr. Paguio in 23 contempt. 24
25 As previously mentioned, if the Court were to find that all the elements of contempt
26 have been satisfied, the non-moving party may assert inability to pay as an affirmative defense. 27 In Lamb v. Hoffman, the Guam Supreme Court affirmed the lower court's finding that the 28
Paguio v. Paguio (DM0816-06) Page 5 of7 Findings of Fact and Conclusions of Law alleged contemnor therein did not establish an inability to pay pursuant to the terms of a court 1
2 order. Lamb v. Hoffman, 2008 Guam 2 ~ 46. In that case, the alleged contemnor provided only
3 a profit and loss statement for a business he owned along with an Income Tax Examination 4 Changes Form. Id. Collectively, the two documents showed that the business operated at a 5 loss, and that the alleged contemnor had no income for a certain amount of time. Id. The 6 Court, however, found that these two documents, balanced against a finding that the alleged 7
8 contemnor had access to a significant fortune, was insufficient to "convincingly establish" his
9 inability to pay. Id. Also, in Rodriguez v. Rodriguez, the Guam Supreme Court affirmed the 10 trial court's finding that the alleged contemnor did not establish his inability to pay. Rodriguez 11 v. Rodriguez, 2003 Guam 8 ~ 16. After considering the alleged contemnor's financial situation 12
13 as a whole, which included the fact that he withdrew a substantial amount of money from his
14 retirement account, the trial court found that the burden of establishing inability to pay was not 15 met. Id. 16 In this case, Mr. Paguio testified to his inability to comply with the Court's order. His 17 testimony revealed that he pays roughly $1300 per month in child support, $530 per month in 18
19 car payments, and his rental income from unit 211 is assigned to the consolidated loan payment.
20 Furthermore, his business did not regain success. Mr. Paguio testified that after all of his 21 expenses, he did not have enough income to comply with the Court's order. Thus, even if all 22 the elements of contempt were met, the Court finds that Mr. Paguio has established his inability 23 to comply with the Court's order by a preponderance of the evidence. 24
26 The Court acknowledges the availability of contempt proceedings to enforce a 27 settlement agreement that is incorporated in to a divorce decree. See. Leon Guerrero v. Moylan, 28
Paguio v. Paguio (DM0816-06) Page 6 of7 Findings of Fact and Conclusions of Law 2000 Guam 8 ~ 8(citing Richardson v. Edwards, 127 F.3d 97, 101 (C.A.D.C 1997). However, 1
2 because the Court will not hold Mr. Paguio in contempt, the Court need not address the issue of
3 sanctions and/or damages. 4 ORDER 5 Based on the foregoing, the Court will not hold Mr. Paguio in contempt. Additionally, 6 the Court will not impose any fines or award any compensatory damages. 7
8 SO ORDERED this~day of August, 2013.
13 HONORABLE VERNON P. PEREZ 14 Judge, Superior Court of Guam 15
Paguio v. Paguio (DM0816-06) Page 7 of7 Findings of Fact and Conclusions of Law