Superior Court Presiding Judge Robert C. Naraja has found businessman Gerhard “Gary” Sword in civil contempt for failing to comply with a court order to pay his debt with the Bank of the Federated States of Micronesia.
Naraja ordered Sword yesterday to pay $500 per month to the bank, instead of $1,000 per month starting Nov. 15, 2013.
Naraja also determined that Sword still owes the bank $4,500.
Saipan Tribune contacted Sword at his office at KKMP FM radio station for comment but a staff said he was not there at the time.
Sword was served with a bench warrant last week for failing to appear at a hearing on Oct. 2, 2013. He was released after posting a $500 bail.
The clerk of court then ordered him to appear in court yesterday to explain why he should not be held in civil contempt for disobeying a court order.
Sword represented himself at yesterday’s hearing. Attorney Michael White appeared for Bank of the FSM.
According to court records, the bank sued Sword in January 2010 for failing to pay $31,409 in principal sum of loan plus interest.
In August 2010, White asked the court to issue a $38,092 default judgment against Sword for not responding to the lawsuit. The clerk of court later issued a default judgment on Sept. 20, 2010.
The clerk of court ordered Sword to appear on Nov. 10, 2010, to answer questions concerning any assets that he may have to satisfy the judgment.
Associate Judge Kenneth L. Govendo reset the Nov. 10 hearing to Dec. 22, 2010, after Sword failed to appear.
On Nov. 30, 2010, White and Sword signed an agreement, in which the defendant promised to pay $1,000 per month, starting on Nov. 1, 2010.
Sword stopped payments on Jan. 24, 2011, leaving a balance of $4,500. The clerk of court ordered him to appear in court on July 20, 2011, to explain why he should not be held in contempt and punished for disobeying the order.
When Sword failed to appear at the July 20, 2011, hearing, the court issued a bench warrant for his arrest.
On Aug. 9, 2011, Sword’s wife, attorney Rosemond Santos, informed the court that she will represent the defendant in the case. Santos also moved to quash the bench warrant.
According to a person who served the show-cause order with Sword at KKMP on May 18, 2011, the defendant told her that he had not made his payments because he was waiting for a $40,000 check from the CNMI government.
On Aug. 11, 2011, Sword posted $1,000 bail. The following month, he again entered an agreement with White, in which he promised to start paying every month starting on Oct. 1, 2011.
White said that Sword stopped paying on May 10, 2013, leaving a balance of $13,400. He then asked the court to issue another show-cause order against the defendant.
On Aug. 27, 2013, the clerk of court ordered Sword to appear in court on Oct. 2, 2013, and explain why he should not be found guilty of contempt.
Sword failed to appear at the Oct. 2 hearing, prompting Naraja to issue a bench warrant for his arrest.
In April 2012, the NMI Retirement Fund filed a lawsuit against Sword and his company for their alleged defective pension software that has already cost the Fund $406,060. It is not clear if the case is still pending.