THE SUPREME COURT OF THE
FEDERATED STATES OF MICRONESIA
Cite as In re Legislative Subpoena,
7 FSM Intrm. 328 (Chk. S. Ct. Tr. 1995)
IN RE: LEGISLATIVE SUBPOENA
SASAO H. GOULAND,
HOUSE SPECIAL INVESTIGATION COMMITTEE,
App. No. 12-95
Order Issued: November 17, 1995
Opinion Entered: December 12, 1995
Hon. Keske S. Marar, Associate Justice, Chuuk State Supreme Court
Hon. Judah C. Johnny, Temporary Justice, Chuuk State Supreme Court*
Hon. Midasy O. Aisek, Temporary Justice, Chuuk State Supreme Court**
*Associate Justice, Pohnpei Supreme Court, Kolonia, Pohnpei
**Attorney, Chuuk State Bar, Weno, Chuuk
For the Appellant: Wesley Simina, Esq.
Office of the Chuuk Attorney General
P.O. Box 189
Weno, Chuuk FM 96942
For the Appellee: Daniel Furrh, Esq.
Legislative Counsel, Third Chuuk State Legislature
P.O. Box EX
Weno, Chuuk FM 96942
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Constitutional Law ) Chuuk ) Legislative Powers
The Chuuk State Legislature has the express constitutional power to conduct investigations and to issue subpoenas in aid of an investigation. Each house has all the authority and attributes inherent in legislative assemblies. In re Legislative Subpoena, 7 FSM Intrm. 328, 331 (Chk. S. Ct. App. 1995).
Constitutional Law ) Chuuk ) Legislative Powers
Constitutional protections are a restraint on legislative investigations. In re Legislative Subpoena, 7 FSM Intrm. 328, 331 (Chk. S. Ct. App. 1995).
Constitutional Law ) Chuuk ) Legislative Powers
Any committee formed by a house of the legislature is restricted to the missions delegated to it, i.e., to acquire certain data to be used in coping with a problem that falls within the house's legislative sphere. This jurisdictional concept requires that material sought by the committee be pertinent or relevant to this function in order to compel disclosure from an unwilling witness. In re Legislative Subpoena, 7 FSM Intrm. 328, 332 (Chk. S. Ct. App. 1995).
Constitutional Law ) Chuuk ) Legislative Powers
A court must presume that an action of a legislative body was taken with a legitimate object if it is capable of being so construed, and has no right to assume that the contrary was intended. In re Legislative Subpoena, 7 FSM Intrm. 328, 332-33 (Chk. S. Ct. App. 1995).
Constitutional Law ) Chuuk ) Legislative Powers
A committee of the legislative house constitutionally charged with the function of impeachment whose authorizing resolution empowered it to investigate the state's insolvency and the executive branch officers' misfeasance, malfeasance, or failure to carry out their duties and responsibilities, presented with evidence that the governor has illegal sources of income that may involve state funds is seeking relevant material related to its function when it seeks to subpoena the governor's bank records. In re Legislative Subpoena, 7 FSM Intrm. 328, 333 (Chk. S. Ct. App. 1995).
Constitutional Law ) Chuuk ) Legislative Powers; Public Officers and Employees ) Chuuk
All citizens generally have the duty to, and state officials are obligated by statute to, cooperate with legislative investigations. These obligations of citizenship and public office are linked with the assumption that the legislature will respect individuals' constitutional rights, including the right of privacy. In re Legislative Subpoena, 7 FSM Intrm. 328, 333-34 (Chk. S. Ct. App. 1995).
Search and Seizure
Persons are secure in their persons, houses, and possessions against an unreasonable invasion of privacy. An invasion of privacy occurs when the government intrudes into any place where the individual harbors a reasonable expectation of privacy. A claim to privacy must be viewed in the specific context in which it arises. In re Legislative Subpoena, 7 FSM Intrm. 328, 334 (Chk. S. Ct. App. 1995).
Search and Seizure
An person's expectation that his bank records will remain private is not reasonable because bank records are not the person's private papers, but are the bank's business records. This does not mean that such records are open to unrestrained production and inspection. For such records to be produced or inspected, the purpose of the intrusion must not be unreasonable. In re Legislative Subpoena, 7 FSM
Intrm. 328, 335 (Chk. S. Ct. App. 1995).
Public Officers and Employees ) Chuuk
All Chuuk public officers are statutorily required to cooperate with legislative investigations, but an officer being tried in the Senate on a case of impeachment after the House of Representatives has voted a bill of impeachment is no longer required to cooperate. In re Legislative Subpoena, 7 FSM Intrm. 328, 336 (Chk. S. Ct. App. 1995).
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KESKE MARAR, Associate Justice:
This is an appeal from the Trial Court's judgment requiring the appellant, Sasao H. Gouland, Governor of Chuuk State [herein referred to as Governor], to turn over his bank records to the appellees, the House Special Investigation Committee [herein referred to as Committee], pursuant to a legislative subpoena.
The Governor was personally served with a legislative subpoena issued by the Committee, on August 18, 1995. The subpoena required the Governor to produce his personal bank records and those of his family, among other documents, for the inspection of the Committee. The Committee was duly authorized by a House of Representatives resolution to investigate the current financial crisis that faces the state and issued the subpoena as part of its investigation. The Governor refused to produce his bank records and those of his family. He brought an action for declaratory relief in the lower court challenging the Committee's authority to seek the bank records. The Governor asserted two grounds for his refusal to produce his bank records. First, the Governor claimed that the documents required by the subpoena exceeded the scope of the Committee's authorizing resolution. Secondly, the Governor contended that the subpoena constituted an invasion of his privacy as protected by Article III, Section 3 of the Chuuk State Constitution.
The Governor first sought a temporary restraining order. The trial court issued a restraining order but only to the extent that the Governor did not have to produce the bank records of his family members, unless the Governor was an owner, joint owner or had the authority to withdraw funds from the account in question. This temporary restraining order was made a preliminary injunction by stipulation of the parties. After requiring the parties to brief the issues and hearing oral argument, the trial court held that the legislative subpoena was valid and that there was no constitutional protection for the Governor's bank records as he had no reasonable expectation of privacy that these records would remain confidential. The court below gave the Governor ten days to produce for the Committee all bank records in which the Governor was named as an owner, joint owner or had the authority to withdraw funds. The Governor appealed.1 We affirmed the trial court's judgment by an Order issued on November 17, 1995.2
[7 FSM Intrm. 331]
Both of the central issues raised by this appeal are issues of first impression. The first issue is: Whether the bank records sought by the Committee's subpoena were within the scope of the authority granted the Committee and relevant to their function? The second issue is: Whether the Governor has, under Article III, Section 3 of the Chuuk State Constitution, a reasonable expectation of privacy in his personal bank records sufficient to prevent the compelled disclosure of these records to a legislative investigating committee? Both issues presented are issues of law. This court uses a de novo standard to review issues of law. Ungeni v. Fredrick, 6 FSM Intrm. 529, 531, 1 CSR 14, 15 (Chk. S. Ct. App. 1994). We turn first to the investigation and the legislative subpoena.
Legislative Investigative and Subpoena Power
The Chuuk State Constitution specifically provides that: "Each house shall have and exercise all the authority and attributes inherent in legislative assemblies, and may institute and conduct investigations, issue subpoenas, and administer oaths." Chk. Const. art. V, § 18. Thus, there is no question that the Chuuk State Legislature has the express constitutional power to conduct investigations and to issue subpoenas in aid of an investigation. The question raised here is the scope of the investigative power and the relevancy of the documents sought to the specific investigation of the Committee. In addressing this question, both parties as well as the lower court have relied on Watkins v. United States, 354 U.S. 178, 77 S. Ct. 1173, 1 L. Ed. 2d 1273 (1957).
Watkins contains a detailed analysis of the historical development of the legislative investigative power. It also explains the general character and restrictions on this power.
The U.S. Supreme Court found that the power to investigate is "inherent in the legislative process." Id. at 187, 77 S. Ct. at 1179, 1 L. Ed. 2d at 1284. The court explained that the power is broad and "encompasses inquiries concerning the administration of existing laws as well as proposed or possibly needed statutes." The legislative investigative power was also found to include "probes into departments of the . . . Government to expose corruption, inefficiency or waste." Id. But even as broad as this power of inquiry may be "it is not unlimited" as there is "no general authority to expose the private affairs of individuals without justification . . ." Id. To justify the investigation the inquiry "must be related to and in furtherance of a legitimate task of" the legislature. Id.
The Watkins court recognized, as does this court, that the protections embodied in Article III of the Constitution, as modeled on the Bill of Rights of the U.S. Constitution, are a restraint on legislative investigations. Yet even if compelled disclosures may have adverse effects on an individual's rights that does not mean that all such inquires are barred. Id. at 198, 77 S. Ct. at 1185, 1 L. Ed. 2d at 1290.3 Thus, the function of the court is to balance the legislature's need for information with the individual's interest in privacy or other protected rights. But, we cannot blindly assume that every legislative investigation is justified by a public need that overbalances any private rights affected. "The critical element is the existence of, and the weight to be ascribed to, the interest of the . . . [legislature] in demanding disclosures from an unwilling witness." Id. This element is to be determined from the
instructions given to an investigating committee by the legislature as embodied in the authorizing resolution. Consequently, we must first determine the nature of what the House of Representatives has authorized the Committee to investigate.
Any committee formed by a house of the legislature is "restricted to the missions delegated to them, i.e., to acquire certain data to be used by the House . . . in coping with a problem that falls within its legislative sphere." Id. at 206, 77 S. Ct. at 1189, 1 L. Ed. 2d at 1294. This restriction forms a "jurisdictional concept" that requires material sought by the Committee be pertinent or relevant to their function in order to compel disclosure from an unwilling witness. Id.
The Governor contends that the material sought by the Committee must be specifically mentioned in the authorizing resolution. Otherwise disclosure may not be compelled. Watkins teaches otherwise.
The court in Watkins found that the subject of the investigation or the "`question under inquiry'" must be sufficiently clear so as to avoid vagueness. Id. at 209, 77 S. Ct. at 1190, 1 L. Ed. 2d 1296. In determining whether or not there is sufficient clarity in the investigative purpose, the court held that it was not limited only to the words of the authorizing resolution. The Watkins court explained that the courts could draw on several sources to make this determination. Id. Remarks of the chairman, members of the committee, the nature of the proceeding or information from witness may be used to determine if the material sought is relevant to the purpose of the investigation. Id. at 209-13, 77 S. Ct. at 1190-92, 1 L. Ed. 2d 1296-98. Relevance itself is a well known legal concept that is defined in our own rules of evidence. Rule 401 states that material is relevant if it has "any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would without the evidence." Chk. Evid. R. 401.
In Watkins, the court found that the authorizing resolution concerned the investigation of "Un-American activities." This the Watkins court found was so vague that it made the authorizing resolution meaningless to their inquiry. After turning to the remarks of the Chairman and the testimony of witnesses that preceded Mr. Watkins, the court was still unable to sufficiently determine the relevancy of the questions to the subject of the investigation. Mr. Watkins was appealing his contempt conviction for failing to answer certain questions. The court reversed his conviction. The U.S. High Court reasoned that if they could not determine the relevance of the unanswered questions to the investigation then Mr. Watkins could not be convicted of refusing to answer them. The case now before us presents a very different situation.
The authorizing resolution creating the Committee that is the subject of this case empowered it to "investigate certain financial transaction of Chuuk State, [and] the causes of the State's financial crisis . . . ." Chk. H.J.R. No. 03-95-HR-01. In section 17 of this resolution, the Committee was further empowered to investigate "Any instances of the Governor, his appointees, or the Lt. Governor, not carrying out the duties and responsibilities of their offices as mandated by Chuuk State Constitution or by law, or of misfeasance or malfeasance in office by them." Id. at 4-5. This authorization by the House of Representatives is far more specific than the authorizing resolution that the Watkins court found vague.
First, section 17 of the Committee's authorization empowers it to investigate a public institution or public official that is subject to the control of the legislature, i.e., the executive branch of government and its principal officers. That being the case, the court must presume "that the action of the legislative body was [taken] with a legitimate object if it is capable of being so construed, and
we have no right to assume that the contrary was intended."4 McGrain v. Daugherty, 273 U.S. 135, 178, 47 S. Ct. 319, 330, 71 L. Ed. 580, 595 (1927) [explanation added]. Additionally, Representative Smith, the Chairman of the Committee, set forth the reasons the Committee needed to inspect the Governor's bank records. He stated that the Committee had heard sworn testimony of several witnesses that indicated the Governor is a "frequent gambler," loses "substantial sums of money on a regular basis" and that these losses "exceed his annual income as Governor of the State." Aff. Chairman Smith. Other witnesses according to the Chairman indicated that certain revenue generating state laws were not being enforced by the executive branch of Government. Id. The Chairman summarized that in view of the state's lack of funds "in conjunction with the suspicion that very large sums of money pass through the Governor's hands with no known legitimate explanation, have caused the . . . Committee to suspect that such funds have been obtained illegally." Id. This information formed the basis of the Committee's desire to examine the Governor's bank records.
Thus, the Committee in its investigation into the reasons for the financial insolvency of the State and whether or not any of the principal officers of the Executive Branch were in some way implicated in this crisis developed evidence specifically related to these purposes. The next step is to discover if in fact there were illegal sources for the Governor's unexplained income which would link the two aspects under investigation.
The Committee was additionally empowered to investigate possible malfeasance, misfeasance or the failure to carry out the duties of office in connection with the financial problems. These are not vague terms such as "Un-American activities" but rather all have a specific legal meaning. Determining whether or not the Governor has an illegal source of income that may involve state funds or the failure to enforce certain laws falls easily within the definition of the terms used in section 17 of the resolution.
Further, the Committee is the investigating arm of the House of Representatives which is constitutionally charged with the function of impeachment. Chk. Const. art. V, § 19(b). All of the items mentioned in section 17 of the authorizing resolution when applied to the Governor are impeachable offenses as set out in Article V, Section 19(a) of the Constitution. Therefore, the investigation is without doubt related to a specific function of the House of Representatives.
We, therefore, must hold, given the language of the authorizing resolution, the remarks of the Chairman and the testimony of witnesses that preceded the subpoena, that the inspection of the Governor's bank records is relevant and pertinent to the investigation of the Committee. Having found that the material sought by the Committee is related to their function and is relevant to the investigation, we now turn to the privacy issue.
The Right to Privacy
We start this discussion by noting it has been held that it is generally "the duty of all citizens to cooperate with the . . . [legislature] in its efforts to obtain the facts needed for intelligent legislative action." Watkins, 354 U.S. at 187, 77 S. Ct. at 1179, 1 L. Ed. 2d 1284. Locally, the Governor as a State official is obligated by statute to cooperate with all legislative investigations. Truk D.L. 27-37,
§ 86 (1977).5Of course, these obligations of citizenship and public office are linked with the assumption that the constitutional rights of the individuals will be respected by the legislature. One such right is that asserted by the Governor, the right of privacy.
The right of privacy claimed by the Governor is found in Article III, Section 3 of this State's constitution.6 This section provides in part that: "[t]he right of the people to be secure in their persons, houses, and possessions against unreasonable . . . invasion of privacy may not be violated."[emphasis added]. Accordingly, it is clear from this language that the right of privacy protected by Article III, Section 3 is a protection against "unreasonable" invasions of privacy. Any doubt is resolved by the explanation of this right in the reports of the Constitutional Convention.
The framers of the Chuuk Constitution first pointed out that the rights under section 3 were intended to be fundamental, but also observed they are "certainly not absolute." Standing Committee Report [SCREP] No. 23, Truk Con. Con. Committee on Civil Liberties 1 (1988).
The framers also explained that an "invasion of privacy occurs when the Government intrudes into any place where the individual harbors a reasonable expectation of privacy . . . ." Id. at 3 [emphasis added]. The Convention recognized the need to balance the interest of Government in maintaining good order against the protected rights of the individual. Id. at 2. The general tenor of the protection was directed to governmental intrusion in the criminal context. The question that we face, then, is whether compelling the Governor to disclose his bank records to a legislative investigating committee is an "unreasonable" invasion of his privacy.
We must view the Governor's claim to privacy in the specific context in which it arises, that of a legislative investigation.7 Accordingly, our decision today on the constitutional protection of privacy is limited to this context.
The right of privacy in relation to documents such as bank records8 stems from the idea that individuals should be able to keep their private papers from the public. But a reasonable expectation that such private papers will remain confidential is weakened when the individual engages in voluntary conduct that exposes the private papers to others. Such is the case with bank records. These records are voluntarily exposed to others, including the employees of the bank, in the form of deposit slips, the
act of writing checks and activities of the like that render the expectation of privacy unjustified in the circumstances. Consequently, the expectation that such papers will remain private is not reasonable. See United States v. Miller, 425 U.S. 435, 440, 96 S. Ct. 1619, 1622-23, 48 L. Ed. 2d 71, 77 (1976). The Miller court found, and we agree, that bank records are not "private papers" of the individual but instead are business records of the bank involved. Id.
In Miller, a case prosecuted in the United States District Court, the accused, moved to suppress copies of checks and other bank records. These records had been procured by a subpoena duces tecum directed to the presidents of two banks where the accused maintained accounts. Without advising the accused of the subpoena, the bank presidents ordered their employees to make the pertinent records available and provide the federal agents with copies of any documents the agents desired. The agents were given copies of the accused's checks, deposit slips, financial statements and monthly statements. The District Court denied the motion to suppress. Mr. Miller was convicted and appealed.
The Fifth Circuit Court of Appeals reversed the conviction holding that the government had violated the Fourth Amendment protection against unreasonable search and seizure. United States v. Miller, 500 F.2d 751 (5th Cir. 1974).
The Government appealed to the United States Supreme Court on certiorari. The Government in its appeal asserted, inter alia, that the court of appeals had erred in finding that Mr. Miller "had the Fourth Amendment interest necessary to entitle him to challenge the validity of the subpoena duces tecum through his motion to suppress . . ." United States v. Miller, 425 U.S. 435, 439, 96 S. Ct. 1619, 1622, 48 L. Ed. 2d 71, 77 (1976). The United States Supreme Court found the Fourth Amendment issue dispositive of the case. The Supreme Court held that "[o]n their face, the documents subpoenaed here are not respondent's `private papers'. . ." but instead were "the business records of the banks." Id. at 440, 96 S. Ct. at 1623, 48 L. Ed. 2d at 77-78. Consequently, the court found that Mr. Miller could assert neither ownership nor possession. Id. at 440, 96 S. Ct. at 1623, 48 L. Ed. 2d at 77.
The Judicial Guidance Clause of the Constitution dictates to us that in ruling on issues before this court, we are to be guided by local precedents. Our search leads us to no precedents in our local jurisdictions. We also note that there is nothing in custom or tradition that has any reference to banking records. In the absence of local guidance, we are not restrained from referring to foreign rules to assist in setting our local precedents.
In our view, the principle of Miller's case that there is no reasonable expectation of privacy in bank records since the "depositor takes the risk, in revealing his affairs to another, that the information" may be conveyed to another and that bank records are business records of the bank is persuasive. Miller, 425 U.S. at 443, 96 S. Ct. at 1624, 48 L. Ed. 2d at 79. We therefore adopt that principle. In doing so, we recognize that Miller arose in the context of a criminal prosecution rather than the context of the case before us.9 We also recognize that the subpoena in Miller was not directed to the individual but to a third party. We are cognizant as well that the Fourth Amendment issue decided turned on Miller's standing to assert the protection which requires ownership or possession. But, the individual's right to privacy in bank records was an integral part of the ultimate result in Miller.
The Fourth Amendment of the U.S. Constitution is analogous to Article III, Section 3 of the Chuuk State Constitution as it contains the protection of the right of privacy. Therefore, it follows that records of the banks in which the Governor has deposits in his own name, jointly with members of his family, or from which he has authority to withdraw funds, are business records of the banks and that in revealing those records to others he has no expectation of privacy in them, sufficient for the protection of Article III, Section 3 of the Chuuk State Constitution.
Our holding in this case that bank records are not the property of the depositor should not be construed to mean that such records are open to unrestrained production and inspection. For such records to be produced or inspected, the purpose of the intrusion must not be unreasonable.
The Governor contends that the trial court erred in making public officials exempt from the privacy protection of the Constitution. That contention fails in the sense that the principle of ownership of bank records and the resulting loss of a reasonable expectation of privacy makes no distinction between individuals.
Further, the fact that the Governor has voluntarily entered the political arena diminishes the reasonableness of his expectations that anything he does that concerns his performance in office will remain private. Any individual that voluntarily seeks a position in State Government that is subject to the impeachment power of the legislature can expect to have all their affairs that may be linked to their performance in office scrutinized by the legislature in the course of performing its constitutional function.
Duty to Cooperate
The Governor contended at oral argument that his duty as a public officer to cooperate with investigations pursuant to Truk State Law 27-37 (1977), has been impliedly repealed by a recently enacted statute which exempts him from such cooperation. He rests this contention on the language of Chuuk State Law 2-94-37 [Impeachment Procedure Act (1995)]. We find that his reliance is misplaced.
The exception the Governor relies on is found in Section 7 of the Impeachment Procedure Act. The pertinent provision reads:
[i]n the event of the trial of a case of impeachment all State officials and employees, other than the Respondent in such a case, shall cooperate with the investigation, gathering of evidence, and conduct of trial to the greatest extent reasonably possible, including but not limited to the location of documents, assistance to investigators and counsel for the parties, and testimony in discovery at trial.
Id. [emphasis added]. The Constitution makes clear that the trial of an impeachment is held in the Senate not the House of Representatives. Chk. Const. art. V, § 19(c). Thus, the activities of the Committee which is acting on behalf of the House of Representatives are investigative in nature. No trial will be held until the investigative activities of the Committee are completed and the House of Representatives has approved a Resolution of Impeachment by the necessary vote. Only then will the protections claimed by the Governor under Chuuk State Law 2-94-28, § 7 be operative. Accordingly, we reject this contention.
We find that the subpoena issued by the Committee was valid and the information sought
authorized by the Resolution of the House of Representatives. We also hold that the Governor has no protectable privacy interest in his bank records in the context of a legislative investigation. In view of that fact, we have no need to balance that constitutional protection against the governmental interest involved. For these reasons, we previously entered our order affirming the judgment of the trial court.
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1. The Governor sought a stay initially in the trial court, but the presiding justice was off-island. The Governor then sought a stay in the Appellate Division, which was granted but only after the ten days allowed by the trial court to produce the bank records had expired.
2. This court issued an expedited Order affirming the lower court's judgment due to the importance of this issue and now we set forth out our reasons of that affirmance.
3. The Governor has asserted that to force him to disclose his personal bank records would cause him embarrassment. He then claims that public embarrassment is contrary to Chuukese custom and tradition. But the Governor has failed to offer any authority whatsoever for this position. He presented no evidence in the lower court as to what the possible source of embarrassment could be nor did he present any evidence that this is in fact contrary to Chuukese custom. Thus, in the absence of any evidence or authority, we must reject this contention as meritless.
4. This presumption of legitimate legislative action in the course of an investigation into the workings of government answers the Governor's complaint that the burden of having to prove the legislative action was not unreasonable was misassigned to him. Just as a judicially issued search warrant or other legal process is presumed to be valid, so is legislative action in this area. Accordingly, the burden of showing the action is invalid or unreasonable falls to the party attacking the action.
5. Once a Resolution of Impeachment has been duly adopted by the House of Representatives, the individual to be tried before the Senate is relieved of any further obligation to cooperate in the investigation. See Chk. S.L. 2-94-28, § 7 (Impeachment Procedures Act).
6. The Governor asserts only that his bank records are constitutionally protected by his right of privacy. No other constitutional protections have been advanced and therefore none are before us.
7. This is a recognition by the court that the legislative impeachment function and investigations that are related to that function are unique. They are neither civil nor criminal but wholly political in nature. Thus, analogies to either the civil or criminal process are not controlling nor necessarily useful. As a result we must limit this decision to its particular context.
8. During oral argument, the Governor advanced the idea that the records sought came from banks that may be subject to Secrecy Laws from another jurisdiction and that fact should be of consequence to our determination. But, the Governor provided us with no authority to this effect. We need not consider any proposition on which a party has failed to provide the court with authority and therefore judge the issue to be without merit.
9. We make no ruling on whether or not the Governor could be compelled to produce his bank records if he were the subject of a criminal investigation and asserted his right against self-incrimination under Article III, Section 5 of our constitution. Neither do we decide whether or not the Governor's bank records once obtained by the legislative committee could be later used in a criminal prosecution.