CHIEF Judge Ramona V. Manglona of the District Court for the NMI has denied without prejudice Peace & Order Trading Corporation’s motion to appoint a receiver for an apartment investor, Fairyland Investment, LLC to help the plaintiff satisfy judgement in the amount of $767,697.50.
The judge noted that Peace & Order moved for an appointment of a receiver, but never served defendant Fairyland with its motion as required by Local Rule 63.1.
Accordingly, she said, Peace & Order’s motion is denied without prejudice so that it could refile a new motion that properly follows the procedures of the court’s local rule.
The judge also scheduled a hearing for Sept. 29 at 3:30 p.m.
On July 24, Peace & Order, through attorney Colin Thompson, asked the court for an order appointing a receiver to administer, collect, or sell any real or personal property in which defendant-judgment debtor Fairyland Investment, LLC has an interest, specifically Lot 019 D 61 and Lot 019 D 83 on Navy Hill.
Thompson also asked for an order directing Fairyland to turn over to the receiver title to its assets in an amount sufficient to satisfy the judgment, plus post-judgment interest; and to award Peace & Order its attorney’s fees and costs in accordance with the terms of the agreements between the parties.
Peace & Order likewise asked the court to issue an order appointing a receiver without the requirement of posting a bond.
Judge Manglona noted that while the plaintiff cited Federal Rules of Civil Procedure 64 and 69(a)(1) for why a receivership is warranted in this matter, “Peace & Order’s request appears to rely on state law for the appointment of receiver — namely, 7 CMC § 4104.”
In line with the federal rules, Judge Manglona said, the district court has a local rule pertaining to receiverships — Local Rule 63.1.
“This rule requires the service of a motion to appoint a receiver to be served on all parties and compels the defendant to list the defendant’s creditors and their addresses within seven…days after being served. If the defendant provides the plaintiff with a list of creditors, then the plaintiff must mail to the creditors listed a notice of hearing not less than five…days before the hearing and file proof of mailing. The local rule also provides that compensation be fixed by the judge, requires reports within 28 days, and requires deposits of funds to be received in a depository designated by the judge. Additionally, the rule provides the court discretion on whether to impose a bond,” the judge said.
On April 13, 2021, the court issued a default judgment against Fairyland in the principal amount of $767,697.50 plus attorney’s fees and costs, including applicable federal interest rate for post-judgment interest.
Peace & Order sued Fairyland Investment, LLC, which is owned by Zhi Qi Shen for breach of construction contract and unjust enrichment.
Peace & Order was a contractor hired by Fairyland to remodel and build an apartment building on Navy Hill, Saipan.
According to the lawsuit, Peace & Order stopped work on the project because Fairyland refused to pay the amount owed for work completed.
Ramona V. Manglona
