Superior Court Associate Judge Kenneth L. Govendo has applied to withdraw his employee contributions from the NMI Retirement Fund in an amount that, if granted, would total more than $50,000.
Govendo's application prompted the Fund board of trustees, through counsels Daniel J. Berman and Braddock J. Huesman, to ask the Superior Court yesterday to disqualify Govendo from presiding over the Fund's lawsuit against the CNMI government.
According to Berman and Huesman, Govendo, the assigned judge in the Fund lawsuit, submitted in writing on Sept. 19, 2012, his application to withdraw his employee contributions from the Fund.
Just days before, on Sept. 11, 2012, Gov. Benigno R. Fitial signed into law Public Law 17-82, which allowed Fund members to withdraw the full amount of their contributions without separating from the government. To date, more than 1,700 members have applied for refunds with the Fund. After issuing 93 refund checks, the Fund suspended the disbursement, citing the delinquent contributions of both the employee and employer contributions of the government and its autonomous agencies.
In a seven-page motion to disqualify Govendo, Berman and Huesman said that Govendo is holding position number 1,002 in the line of government employee applications to terminate his membership in the Fund and withdraw his employee contributions.
“Records within the Fund reflect that the judge's requested distribution or payout, if granted or ordered by this court, would be substantial and more than $50,000,” the lawyers said.
For the moment, the Fund is holding confidential the exact amount that is possibly payable to Govendo.
However, the lawyers said, should the Superior Court require an evidentiary hearing on the matter, then, if required, the Fund's plan administrator will appear in court to testify on the exact sum possibly payable.
On Dec. 13, 2012, the Commonwealth Ports Authority filed a motion for an order to show cause to hold
Fund trustee ad litem Joseph C. Razzano in contempt for failing to, among other things, “comply with Public Law 17-82.”
Berman and Huesman said CPA has asked the Superior Court to order, under the threat of its contempt power, the trustee ad litem and the Fund to make payments to Fund members who seek to terminate their membership in the Fund, as allowed by Public Law 17-82.
Unfortunately, the lawyers said, CPA's motion puts Govendo in the uncomfortable position of possibly benefiting from his own order.
Should Govendo grant CPA's motion for order to show cause and order the Fund and the trustee ad litem to pay and distribute the employee's retirement benefits pursuant to P.L. 17-82, then Govendo shall receive a direct pecuniary benefit, the two lawyers said.
“Thus, the Fund finds itself in a regrettable and unfortunate position. CPA's motion is baseless, but the motion still seeks to have the court rule on an issue that it has a direct pecuniary interest in,” they said.
Because of this, “and with considerable sympathy for the position of Govendo,” the Fund has no alternative but to request that the judge recuse himself from the case, they said.
The Fund counsels cited that based on the applicable Commonwealth Code, a judge has no discretion but to recuse himself from further proceedings in a case when his impartiality is reasonably questioned or when he or his spouse have a financial interest that could be substantially affected by the judge's decision.
Unfortunately, Govendo's request to terminate his membership in the Fund coupled with CPA's motion make it impossible for him to continue presiding over the action, the lawyers said.
The Fund is suing the government, Gov. Benigno Fitial, Department of Finance, and then Finance secretary Eloy S. Inos over the government's failure to remit required payments.
In 2009, Govendo ruled that the government owes the Fund $282 million in damages and that the law suspending government contributions to the Fund is unconstitutional.