SUPERIOR Court Associate Judge Joseph N. Camacho has granted the motion of the heirs of Mendiola to dismiss the cross claim against them by the Department of Public Land over a deed of exchange.
Judge Camacho dismissed the cross claim because the deed of exchange fulfills the public purpose to provide Mariano Castro Mendiola and his heirs a homestead when DPL, through surveying and redesignation of the land, created a situation that cut off all public roads to the homestead, making the homestead landlocked and inaccessible.
Factual background
On March 3, 1962, the Trust Territory of the Pacific Islands granted a permit to homestead to Mariano Castro Mendiola for H 28-A in the I-Denni area of Saipan.
Mariano C. Mendiola died in 1985, and H 28-A was distributed at probate to his heirs.
On Dec. 4, 1990, the Marianas Public Land Corporation or MPLC executed a Quitclaim Deed for H-28-A and had the property H 28-A redesignated as Lot 106 E 01, which contained an area of 32,000 square meters, to the heirs of Mendiola.
On Feb. 4, 2007, the heirs of Mendiola wrote a letter to DPL requesting to relocate to another available public land that was accessible.
DPL’s predecessor MPLC had failed to provide public road access which technically landlocked Lot 106 E 01.
Lot 106 E 01, formerly Lot H 28-A, was not landlocked when it was deeded to Mariano C. Mendiola in 1962.
DPL resolved to settle the lack of public access problem with the heirs of Mendiola and on Nov. 2, 2011 — four years after the heirs of Mendiola’s request, and 21 years after the MPLC had issued the landlocked property to the heirs of Mendiola — the secretary of DPL approved to correct the lack of public access problem. The secretary signed a Determination to Acquire Tract No. 106 E 01 and offered the heirs of Mendiola a parcel of public land in Obyan for the heirs of Mendiola’s landlocked property.
On Feb. 12, 2013, DPL and the heirs of Mendiola entered into a deed of exchange in which the heirs of Mendiola conveyed Lot 106 E 01 to DPL and DPL conveyed 31,094 square meters worth of subdivided properties (Lot 039 L 08 to 11, Lot 039 L 13 to 14, and Lot 039 L 17) in Obyan to Ricardo R. Mendiola, William M.L. and Naomi Puanani A. Mendiola.
In the deed of exchange, Ricardo R. Mendiola, and William M.L. and Naomi Puanani A. Mendiola warranted that they had the right to convey Lot 106 E 01 and that they would forever defend and indemnify DPL against any interest or claim arising relating to the property.
DPL executed the deed of exchange, representing that it had the authority to execute it based on its power to manage and dispose of public lands pursuant to Article XI, Section 3 of the Commonwealth Constitution.
The lawsuit
On Sept. 29, 2021, plaintiffs Joseph C. Reyes and Mary Ann Milne filed a verified complaint against Ricardo R. Mendiola and DPL for slander of title and to quiet title.
Plaintiffs’ alleged that Ricardo R. Mendiola had conveyed 1,500 square meters of his undivided interest in Lot 106 E 01 via a warranty deed to plaintiffs on Jan. 24, 2001.
The lawsuit stated that on Feb. 12, 2013, DPL, Ricardo R. Mendiola, and other Mendiola family members agreed to convey Lot 106 E 01 without recognizing plaintiffs’ interest in the property.
On Jan. 31, 2022, the government filed its cross claim against the heirs of Mendiola and Ricardo R. Mendiola, seeking to rescind the deed of exchange for breach and the illegality of the land exchange for DPL’s lack of authority to execute it without a public purpose, and also seeking to enforce the indemnification provisions of the alleged illegal deed of exchange at the same time.
On Sept. 12, 2022, plaintiffs and defendant Ricardo R. Mendiola filed a stipulated judgment, entering judgment in favor of plaintiffs against defendant Ricardo R. Mendiola as follows: For entry of judgment in the amount of $47,000 payable at the sum of $600 monthly; for defendant Ricardo and plaintiffs to execute a mutual agreement to rescind/terminate the warranty deed executed by defendant Ricardo to plaintiffs for the previously conveyed 1,500 square meters of Lot 106 E 01; for defendant Ricardo to convey 1,500 square meters of Lot 039 L 13 (a portion of the lot given to him through the deed of exchange) to plaintiffs; and for plaintiffs to hold a lien against defendant Ricardo’s vehicle.
The court issued its order granting the stipulated judgment on Sept. 15, 2022.
The heirs of Mendiola, represented by attorney Robert T. Torres, said the government’s claims were rooted in contract law which triggered the six-year limitation under 7 CMC § 2505, making the government’s claims time-barred.
The deed of exchange was executed on Feb. 12, 2013, resulting in a deadline of on or about Feb. 13, 2019, for the government to bring its claims, they added.
According to the heirs of Mendiola, the government did not plead an exception to the six-year limitation, thus failing to state a claim upon which relief can be granted.
For its part, DPL, represented by the Office of the Attorney General, stated that its claims were about the recovery of land which would trigger 7 CMC § 2502(a)(2), and a longer statute of limitations period of 20 years.
In his 16-page order, Judge Camacho found that DPL had authority in entering into a land exchange agreement with the heirs of Mendiola because the deed of exchange had a public purpose adhering to the homestead program.
He said DPL and the heirs of Mendiola entered into the deed of exchange because Lot 106 E 01 was made inaccessible and landlocked through the actions of DPL, and DPL provided accessible land to fulfill the homestead program’s goal.
“Therefore, the deed of exchange is not illegal, and the court need not rescind the deed of exchange,” the judge said.
