Justia Real Estate & Property Law Opinion Summaries

The Supreme Court reversed the judgment of the intermediate court of appeals (ICA) affirming the judgment of the circuit court granting Defendants' motion to compel arbitration of Plaintiff's complaint against a partnership and a partner after concluding that Plaintiff's claims arose out of the agreement founding the partnership, signed by Plaintiff, that contained an arbitration clause, holding that the claims in Plaintiff's complaint were not subject to the arbitration clause in the partnership agreement.Plaintiff, a founding partner of the partnership, brought claims alleging conversion, fraudulent conversion, and punitive damages. The lower courts concluded that Plaintiff's claims arose out of the partnership agreement, and therefore the arbitration clause applied. The Supreme Court reversed, holding that because Defendants failed to initiate arbitration pursuant to Haw. Rev. Stat. 658A-9 before filing a motion to compel arbitration and because the arbitration clause did not encompass Plaintiff's claims for conversion, the ICA erred in affirming the circuit court's order granting Defendants' motion to compel arbitration. View "Yamamoto v. Chee" on Justia Law

In this foreclosure dispute, the Supreme Court affirmed the judgment of the intermediate court of appeals (ICA) affirming the circuit court's determination of lien priority between the Villages of Kapolei Association's (Association) lien and the Hawai'i Housing Finance and Development Corporation's (HHFDC) competing lien and the valuation of HHFDC's senior lien, holding that the ICA did not err.Specifically, the Court held (1) the ICA did not err by affirming the circuit court's alleged retroactive application of Haw. Rev. Stat. 201H-47 to rule that the HHFDC's lien was senior and superior to the Association's liens; (2) the ICA did not err in determining the appraisal process applied; and (3) the ICA did not err by holding that HHFDC had standing to enforce a shared appreciation or equity agreement between another party and HHFDC's predecessor in interest. View "American Savings Bank, F.S.B. v. Chan" on Justia Law

In this taxation dispute between the County of Maui and Appellees, which leased land on the island of Maui to operate their wind farms, the Supreme Court upheld the Tax Appeals Court's (TAC) final judgment in favor of Appellees, holding that the TAC properly held that the County exceeded its constitutional authority by amending Maui County Code 3.48.005 to expand its definition of "real property" to include "personal property."The County included the value of Appellees' wind turbine in their real property tax assessments and redefined the term "real property" within section 3.48.005 of the MCC to include wind turbines for that purpose. The TAC concluded that the County exceeded its authority under Haw. Const. art. VIII, 3 because the delegates to the 1978 Constitutional Convention did not intend to grant counties the power to redefine "real property." The Supreme Court affirmed, holding that the County exceeded its constitutional power when it amended MCC 6.48.005 to redefine "real property." View "In re Tax Appeal of Kaheawa Wind Power, LLC v. County of Maui" on Justia Law

In this foreclosure case, the Supreme Court held that the circuit court's award of a forfeited down payment as damages to the Association of the Owners of the Kumulani of the Uplands at Mauna Kea, creditors in the judicial foreclosure action, was an abuse of discretion.In response to a pair of post-judgment motions, the circuit court entered two orders. The first order found OneWest Bank, F.S.B., the foreclosing mortgagee and winning bidder at the foreclosure auction, liable for damages in an amount equal to its down payment for failure to close the foreclosure sale. The second order awarded the down payment as expectation damages to the association, a junior lienholder. On appeal, OneWest challenged the circuit court's jurisdiction to assess damages against OneWest and award them to the association. The Supreme Court held that because, pursuant to Haw. Rev. Stat. 667-3, creditors in a judicial foreclosure action are entitled to payment according to the priority of their liens, the circuit court erred by awarding damages to the Association rather than by applying the down payment amount to reduce the debt owed to OneWest. View "OneWest Bank, F.S.B. v. Ass'n of the Owners of the Kumulani at the Uplands at Mauna Kea" on Justia Law

The Supreme Court affirmed in part and vacated in part the judgment of the intermediate court of appeals (ICA) in this litigation concerning a dispute arising from a 1999 contract regarding the sale of approximately twenty-three acres of land in Honualua Maui, holding the the ICA erred by holding that Wailea Resort Company was clearly entitled to certain funds but otherwise did not err.The parties in this consolidated appeal were Michael Szymanski, Wailea, and ADOA-Shinwa Development and Shinwa Golf Hawai'i Company (collectively, Shinwa). Szymanski filed this application seeking a writ of certiorari raising seven questions. The Supreme Court held (1) the questions relating to the disqualification of the Honorable Rhonda I.L. Loo were without merit; (2) the ICA did not err in its application of the law of the case doctrine to the issue of whether the ICA gravely erred when it declined to review whether the Honorable Peter T. Cahill's 2015 order entering final judgment improperly dismissed with prejudice Szymanski's third-party complaint against Shinwa; and (3) the ICA erred by holding that Wailea was clearly entitled to certain funds and by affirming the circuit court's disbursal of funds. View "Title Guaranty Escrow Services, Inc. v. Wailea Resort Co., Ltd." on Justia Law

The Supreme Court answered three modified questions certified to it by the United States District Court for the District of Hawai'i in a federal court lawsuit where a grantor asserted that an escrow company's alleged deletion of an easement from the property description attached to a deed he executed rendered the deed a forged deed that was void ab initio and the escrow company and grantee asserted that the grantor's claim sounded in fraud and was barred by a statute of limitations.The Supreme Court held (1) a deed is void ab initio for fraud such that a claim challenging the validity of the deed is not subject to a statute of limitations under certain circumstances; (2) the six-year "catch-all" statute of limitations under Haw. Rev. Stat. 647-1(4) applies to a claim that a deed was procured by fraud of the type that does not render it void ab initio, such as fraud in the inducement and constructive fraud; and (3) the statute of limitations begins to run on a grantor's claim that a deed was procured by fraud of the type that does not render it void ab initio when the grantor discovers or should have discovered the existence of the claim or the person liable for the claim. View "Hancock v. Kulana Partners, LLC" on Justia Law

In this case involving $537,000 in excess foreclosure sale proceeds the Supreme Court vacated the judgment of the intermediate appellate court (ICA) and the circuit court's final judgment in favor of Respondents, holding that the circuit court's determination that Petitioners could have reasonably known of certain transfers and their fraudulent nature on or before February 21, 2005 contravened this Court's ruling in Schmidt II.Petitioners obtained a final judgment for the excess proceeds but later learned that those same proceeds were already transferred. Petitioners then brought a complaint alleging that the proceeds were fraudulently transferred. The circuit court entered judgment in favor of Respondents. The ICA concluded that Petitioners' claim under Hawai'i Uniform Fraudulent Transfer Act (HUFTA), Haw. Rev. Stat. Chapter 651 C, should have been dismissed as untimely. The Supreme Court vacated the judgment, holding that the ICA incorrectly held that the statute of limitations ran from the date of the transfer rather than from the date that Petitioners discovered the fraudulent nature of the transfer. On remand, the circuit court concluded that Petitioners' claims were time barred. The ICA affirmed. The Supreme Court reversed, holding that the statute of limitations for Petitioners' HUFTA claim did not begin until July 26, 2005, and therefore, Petitioners timely raised their claims. View "Schmidt v. HSC, Inc." on Justia Law

The Supreme Court affirmed the trial court's determination that the State breached its constitutional trust duties by failing reasonably to monitor or inspect trust land at issue in this case, holding that an essential component of the State's duty to protect and preserve trust land is an obligation to reasonably monitor a third party's use of the property, regardless of whether the third party has in fact violated the terms of any agreement governing its use of the land.The State leased three tracts of ceded land to the United States for military purposes. Plaintiffs filed a complaint alleging that the State, as trustee of the state's ceded lands, breached its trust duty because it was aware of the possibility that the land leased to the United States contained munitions and explosives but had not taken concrete steps to investigate or ensure the United States's compliance with the lease. The trial court entered judgment in favor of Plaintiffs. The Supreme Court primarily affirmed, holding (1) the circuit court correctly determined that the State did not reasonably monitor the trust property, including the United States' compliance with the lease terms that protect trust property; and (2) the injunctive relief ordered by the circuit court was not entirely suited to remedy the breach. View "Ching v. Case" on Justia Law

In this foreclosure action, the Supreme Court affirmed the judgment of the intermediate court of appeals (ICA) vacating the circuit court's grant of summary judgment for Nationstar Mortgage, LLC but corrected the ICA's reasoning, holding that the ICA erred in holding that Nationstar's business records were trustworthy under the business records exception to hearsay and that Daniel Kaleoaloha Kanahele's affirmative defenses should have been addressed by the circuit court.After Kanahele defaulted on a loan, Nationstar initiated this foreclosure action. The circuit court issued final judgment in favor of Nationstar. Although the ICA vacated the judgment and remanded for further proceedings, Kanahele asked the Supreme Court to review additional issues he argued were either incorrectly resolved or left unresolved by the ICA. The Supreme Court held that the ICA erred with respect to two issues and that Kanahele would be prejudiced on remand absent the Court's further review. Specifically, the Court held (1) in light of Nationstar's failure adequately to explain material discrepancies in its business records and its presentation of contradictory declarations regarding which of several versions of Kanahele's note was the original, the ICA should have vacated the circuit court's order on this ground as well; and (2) the ICA should have clarified whether Nationstar was subject to Kanahele's affirmative defenses. View "Nationstar Mortgage LLC v. Kanahele" on Justia Law

The Supreme Court affirmed in part and vacated in part the judgment of the intermediate court of appeals (ICA) finding that no evidence was introduced at trial to support the jury's findings that Regal Capital Corporation (Regal Corp.) violated the terms of agreements of sale it entered into with Elesther Calipjo for two parcels of land, Regal Capital Co., LLC (Regal LLC) engaged in unfair and deceptive acts or practices, and Jack Purdy was the alter ego of Regal Corp. and Regal LLC, holding that the ICA's holding was error.Based on the alter ego finding, the jury determined that Purdy, too violated the agreements for the two properties and committed unfair and deceptive acts or practices. The Supreme Court held (1) there was evidence to support the jury's verdict that Regal Corp. violated the terms of the agreements, Regal LLC engaged in unfair and deceptive acts or practices, and Purdy was the alter ego of Regal Corp. and Regal LLC; and (2) the ICA erred when it reversed the circuit court's final judgment against Purdy on the breach of contract and unfair and deceptive acts or practices claims. View "Calipjo v. Purdy" on Justia Law