Superior Court associate judge Kenneth L. Govendo denied yesterday the NMI Retirement Fund\u2019s motion for a preliminary injunction that seeks to stop the enforcement of the controversial Derivative Beneficiaries Act.<\/p>\n
He said that duly enacted statutes are presumed constitutional and that Public Law 17-51 increased standing and has no direct impact on the Fund.<\/p>\n
The new law allows Fund beneficiaries to sue on behalf of the pension program if the Fund\u2019s board refuses to initiate such legal action.<\/p>\n
Govendo said the termination of contracts by four of the Fund\u2019s money managers is an incidental effect of Public Law 17-51.<\/p>\n
\u201cThe granting of a preliminary injunction will not cause the Fund\u2019s agents to resume their contracts. The Fund can hire new agents, and those agents can purchase insurance to mitigate the additional risks caused by Public Law 17-51,\u201d said the judge in his 14-page ruling.<\/p>\n
The Fund, through counsel, Carolyn M. Kern, had questioned the constitutionality of the derivative law and argued that issuing a temporary restraining order against it will ensure that the Fund\u2019s assets are invested to maximize the length of time that benefit payments will continue.<\/p>\n
The Fund had also asked the court to stop the Superior Court\u2019s clerk of court from accepting any lawsuit filed pursuant to Public Law 17-51.<\/p>\n
The Office of the Attorney General, as counsel for Fitial, Inos, and the Superior Courts\u2019 clerk of court, had opposed the motion for temporary injunction.<\/p>\n
Assistant attorney general Michael A. Stanker argued that Public Law 17-51 does not harm the Fund but actually endows it and the beneficiaries with additional benefits.<\/p>\n
\u201cWhile the practical effect of the law is that the Fund\u2019s agents have quit, all the board needs to do to remedy this situation is hire new agents,\u201d Stanker pointed out.<\/p>\n
Three retirees\u2014Mariano Taitano, Roman F. Tudela, and Patricia Guerrero\u2014also opposed as intervenors to the Fund\u2019s request for a TRO, arguing through counsel Michael Dotts that there is no justification for the court to restrain Public Law 17-51, which is a lawfully enacted law.<\/p>\n
Dotts said the Fund has other managers besides those who have quit.<\/p>\n
In the Fund\u2019s TRO request, Kern said the Fund has already suffered irreparable harm when its investment consultant, actuary, and at least two money managers terminated or suspended their contracts with the Fund.<\/p>\n
In denying the injunction, Govendo said that Public Law 17-51 does not directly affect the Fund\u2019s assets.<\/p>\n
\u201cWithout a direct effect, the law cannot violate the Constitution. It merely has the incidental effects of chaining the contracting climate that the board must operate in,\u201d he said.<\/p>\n
The judge said the temporary incidental effects of Public Law 17-51 do not constitute an impairment or a diminishment of the beneficiaries\u2019 interests.<\/p>\n
The Fund, Govendo said, is fully capable of suing for any conduct by its agents that violates contracts.<\/p>\n
\u201cPublic Law 17-51 expands the Fund\u2019s rights as the beneficiaries can now sue on behalf of the Fund when the board refuses to act. Thus, there is no impairment,\u201d Govendo pointed out.<\/p>\n
Govendo held an emergency hearing on the TRO request on Sept. 19. <\/p>\n","protected":false},"excerpt":{"rendered":"
Superior Court associate judge Kenneth L. Govendo denied yesterday the NMI Retirement Fund\u2019s motion for a preliminary injunction that seeks to stop the enforcement of the controversial Derivative Beneficiaries Act.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-155685","post","type-post","status-publish","format-standard","hentry","category-local-news"],"_links":{"self":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/155685","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/comments?post=155685"}],"version-history":[{"count":0,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/posts\/155685\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/media?parent=155685"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/categories?post=155685"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.saipantribune.com\/index.php\/wp-json\/wp\/v2\/tags?post=155685"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}