In re Marn Family Litigation.

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Electronically Filed
Supreme Court
SCWC-10-0000181
21-DEC-2016
07:56 AM

IN THE SUPREME COURT OF THE STATE OF HAWAI#I

---o0o---

IN RE: MARN FAMILY LITIGATION

SCWC-10-0000181

CERTIORARI TO THE INTERMEDIATE COURT OF APPEALS
(CAAP-10-0000181; MASTER FILE NO. 00-1-MFL)

DECEMBER 21, 2016

RECKTENWALD, C.J., NAKAYAMA, McKENNA, POLLACK, AND WILSON, JJ.

OPINION OF THE COURT BY NAKAYAMA, J.

I. INTRODUCTION

This appeal is the most recent development in the Marn

family litigation, which has been ongoing for almost twenty years

and concerns the ownership and control of the Marn family

business. In brief, in 1998 Petitioner-Appellant Alexander Y.

Marn (Alexander) sought a declaratory judgment and specific

performance regarding his rights to the family business. Despite

a jury demand, a bench trial was held and the Circuit Court of

the First Circuit (circuit court) held in favor of Respondent-
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Appellee James K.M. Dunn (Dunn). The Intermediate Court of

Appeals (ICA) affirmed the circuit court’s judgment on all

counts.

At issue for our review is whether Alexander was denied

his right to a jury trial when the circuit court decided the

underlying dispute by bench trial.

Because Alexander was constitutionally entitled to a

trial by jury on his action for declaratory judgment, and because

the record indicates that a jury trial was properly demanded and

preserved, we hold that the ICA gravely erred in affirming the

circuit court’s decision to conduct a bench trial in this case.

As such, the ICA’s March 23, 2016 judgment on appeal, which

affirmed the circuit court’s October 25, 2010 partial final

judgment, is vacated and remanded on the ground that Alexander

was entitled to a jury trial.

II. BACKGROUND

This case arises from a partnership dispute between

four siblings over the operation of a family business, McCully

Associates, and the siblings’ respective interests in the

business.

The Marn parents built a successful family business

through Ala Wai Investment, Inc., a Hawai#i corporation, and

McCully Associates (MA), a Hawai#i limited partnership. Ala Wai

Investment was the corporate general partner of MA, and MA

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developed and managed various Marn properties, including the

McCully Shopping Center.

Four of the Marn children (James, Alexander, Annabelle,

and Eric) served as limited partners and owned equal shares of

MA. Annabelle died in 1996 and her interest in MA was left to

her husband, James Dunn, as the trustee of the Annabelle Y. Dunn

Trust (AYD Trust). The underlying dispute in this case arose

between some of the Marn siblings and Dunn over Annabelle’s

interest in MA.

A. Circuit Court Proceedings

Over the last seventeen years, various suits were

brought by members of the Marn family over the ownership and

control of MA and its properties. These suits were consolidated

for discovery and case management, but not for trial. Of the

cases that were filed, only Civil No. 98-4706-10 (the Buyout

case) and Civil No. 98-5371-12 (the Judicial Accounting case)1

reached trial. On appeal for our review is a single issue

regarding the Buyout case.

On October 29, 1998, Alexander and Eric filed the

original complaint for the Buyout case,2 seeking both declaratory

1
In the Judicial Accounting case, James Marn and the AYD Trust
sought a full and complete judicial accounting of MA and an appointment of a
receiver for MA and Ala Wai Investment, Inc.
2
Alexander filed a first amended complaint on April 27, 2001,
essentially raising the same grounds and seeking the same relief.

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relief and specific performance regarding the partners’ rights to

buy-out Annabelle’s interest in MA. Alexander and Eric asserted

that two agreements, the McCully Associates Partnership Agreement

(Partnership Agreement) and the Transfer Restriction Agreement

(Transfer Agreement), both drafted in 1982 and signed by all

siblings, were created “to ensure that the Marn Properties would

stay in the Marn Family.”

According to Alexander and Eric, under the Partnership

and Transfer Agreements, a partner was prohibited from disposing

of his or her interest in MA without first offering to sell his

or her interest to the other partners. Accordingly, Alexander

and Eric asserted that when Annabelle died and her interest in MA

passed to Dunn through the AYD Trust, Dunn was obligated to offer

to sell this interest in accordance with the terms of the

Partnership and Transfer Agreements.

As such, under the heading “Claim for Declaratory

Relief,” Alexander and Eric made the following request for

relief:
25. Plaintiffs believe that the trustees of the Revocable
Trust, the personal representatives of the Estate of
Annabelle Dunn (Defendants James Dunn and Stephen Marn),
and/or such persons who currently hold Annabelle’s
Partnership interests, are obligated to sell those interests
in accordance with the terms of the Partnership Agreement
and the Transfer Restriction Agreement[.]
26. In the alternative and if the sale of Annabelle’s
Partnership interest has not been triggered by the foregoing
events, Plaintiffs believe that they were deceived or, at a
minimum, reasonably operated under a mistake of fact, in
their consent to the holding of Annabelle’s interest in the
partnership in the name of the Revocable Trust. Had they
known that the Marn Properties would not be kept within the

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Marn family, they would not have consented to the purported
assignment.
27. Plaintiffs have deposited into escrow 1) earnest money
and 2) documents ready for execution, to effect and
facilitate the transfer of Annabelle’s Partnership interest
as required by the foregoing agreements. The escrow was
ready to close on or before September 28, 1998. Plaintiffs
made demand upon James Dunn and Stephen Marn to sell
Annabelle’s Partnership interest in accordance with the
foregoing agreements, but they refused to do so.
28. As a result, a genuine dispute has arisen between the
parties, which is ripe for decision. A decision at
this time will materially aid the parties in their own
planning and in the operation of the Partnership.

Additionally, under the heading “Claim for Specific

Performance,” Alexander and Eric made the following request for

relief:
If the Court agrees that Defendants are obligated to sell
Annabelle’s interest in the Partnership to the remaining
limited partners, then Plaintiffs request that the Court
enforce the terms of the purchase and sale provisions, as
the Plaintiffs are ready, willing and able to perform and
they have no adequate remedy at law, because the underlying
asset of the Partnership is real property, the loss of which
cannot be adequately compensated by damages.
Plaintiffs pray judgment as follows:
1. That process issue out of and under the seal of
this court, citing and summoning the defendants to
appear and respond as required by law; and
2. That the court determine that those Defendants
who hold the Partnership interest originally held in
the name of Annabelle Y. Dunn are obligated to sell
the same to the remaining limited partners; or, in the
alternative,
3. That the Consent to Assignment of Annabelle’s
Partnership interest to her Revocable Trust was
ineffective to waive Plaintiffs’ rights to purchase
Annabelle’s interest;
4. That this Court order the sale of the Annabelle
Y. Dunn partnership interests in McCully Associates to
the other limited partners of the Partnership at a
price consistent with sections 1,2,3 and 4 of the
McCully Associates Partnership Agreement and the
Transfer Restriction Agreement annexed as Exhibit “B”
thereto.
5. For their cost of court, reasonable attorneys
[sic] fees and such other relief as is just.

On December 4, 1998, the AYD Trust filed an answer to

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the complaint, admitting that it had refused to sell Annabelle’s

partnership interest and denying that “any transfer of

partnership interest is ‘required.’” The AYD Trust also included

in its answer a demand for jury trial. On December 11, 1998, the

AYD Trust filed a first amended answer to the complaint, which

also included a jury demand.

In the October 15, 19993 and February 1, 20024 orders

setting trial for the Buyout case, it was noted that the case was

set for a jury trial.

In June of 2005, the court’s appointed receiver for MA

(the Receiver) filed a motion for summary judgment or, in the

alternative, a motion to strike jury demands in the Buyout and

Judicial Accounting cases. Eric filed a memorandum in opposition

to the motion to strike jury demand, which Alexander joined. In

its order granting in part the Receiver’s motion for summary

judgment, the court5 concluded that it was unnecessary to decide

the jury issue at that point.

During a pretrial hearing on August 24, 2005, the trial

by jury issue was discussed for the Buyout case. Wayne Sakai,

counsel for Eric and Linda Marn, argued that there should be a

3
The Honorable Kevin S.C. Chang presided.
4
The Honorable Virginia Lea Crandall presided.
5
The Honorable Victoria S. Marks presided over the proceedings from
this point forward.

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jury trial for the Buyout case because there were factual and

legal issues that needed to be resolved. Steven Guttman, counsel

for Dunn,6 argued that a jury trial had not been demanded for the

Buyout case and that there was no right to demand a jury trial at

this time. The circuit court agreed with Guttman.
[MR. SAKAI]: Your Honor, if I may address and add to what
Mr. Guttman and Mr. Freed said is we believe that another –-
the third issue would be ripe for the Court’s adjudication
without being enmeshed in the I.R.S. criminal investigation
would be the buy-out. . . . It just goes to the ability of
Eric and Alexander Marn’s ability to buy-out the Dunn,
Annabelle Dunn’s share.
And our position is that’s a valid agreement, and that
should be heard by the Court. And if the Court hears that,
there’s another catch to it is, I believe, that there’s
factual determinations to be made in addition to legal
issues, than [sic] a jury trial should be warranted on that
aspect of it. Because it does not involve at all the I.R.S.
It does involve factual and legal issues, and I think we
need –- not I think, I –- I believe we need a jury to
determine the factual issues, and the Court to determine the
legal issues.
But the buy-out is very isolated, and it’s very clean,
your Honor, very clean. And I think that requires a very
short jury trial that, basically, there’s not too much for
the jury to determine. I think the factual issues are
there. If they want to do a stipulated facts, we can do
that, but I –- I don’t think they want to do that. So we
need a jury to determine the facts of the case, but I think
that’s a –- a document that cries out to be adjudicated
separate and apart from the I.R.S. issue.
The buy-out is very important, and it could have
significant impact upon the current mediation right now.
I’m only talking about the Dunn –-
[THE COURT]: Uh-huh.
[MR. SAKAI]: The Dunn –- Annabelle Dunn matter, and that,
you know, that would be, I think, very helpful. And I’d
like to add that to the –- the package, so to speak.
[MR. GUTTMAN]: Your Honor, as –- as to that matter . . .
There was no jury demand. There is no right to a jury at
this date to be requesting a jury. I –- I think in terms of
the factual issues, 90 percent to the facts, I don’t think
there’s any disagreement. I think the – the actual facts

6
Attorneys James J. Bickerton and Alan B. Burdick represented Dunn
in the initial proceedings in this case, when the AYD Trust filed its
December 4, 1998 answer to the complaint and demand for jury trial and
December 11, 1998 first amended answer to the complaint and jury demand.

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are –- are very narrow that that [sic] are in dispute. . . .
But there’s only a small number of facts that are
actually in dispute. Most of it is –- is real clear.
. . .
[THE COURT]: There are a lot of files. But as I recall, I
think Mr. Guttman is correct that there was no separate jury
demand in the buy-out.

(Emphasis added).

On November 29, 2006, the circuit court entered a trial

setting order, in which the “Jury-waived” box was now checked.

Trial was held on April 10 and 11, 2007.

On July 9, 2007, the circuit court entered its findings

of fact, conclusions of law, and order in favor of the AYD Trust.

The circuit court made the following conclusions of law:
1. Mrs. Dunn properly assigned all of her limited
partnership interest in McCully Associates to her Trust with
the consent of the general partner and all other limited
partners pursuant to the terms of the Partnership Agreement.
2. The Assignment effected a substitution of her Trust as
a limited partner of McCully Associates.
...
4. After Mrs. Dunn died, the buyout provision of the
Partnership Agreement was not applicable because Mrs. Dunn’s
Trust was already substituted as the limited partner of
McCully Associates.
...
6. Independent of the Assignment . . . Plaintiffs cannot
force the AYD Trust to sell its limited partnership interest
in McCully Associates because Plaintiffs materially breached
the terms of the Partnership Agreement.
7. Plaintiffs[’] failure to properly and timely make
their first installment payment of the purchase price within
90 days of Mrs. Dunn’s death and, in fact, waiting
approximately 25 months after Mrs. Dunn’s death before ever
expressing an interest in exercising the buyout right set
forth under the Partnership Agreement is a material breach
of the Agreement’s buyout provision.
...
12. The AYD Trust did not breach the Partnership
Agreement’s “buyout” provision, while Plaintiffs materially
and repeatedly breached the said provision. Therefore,
Plaintiffs are not entitled to specific performance.
Furthermore, granting Plaintiffs the equitable remedy of
specific performance would in effect reward Plaintiffs for
the violations of their contractual duties owed to the AYD

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Trust, an inequitable result as to the AYD Trust.

As such, the circuit court ordered that the AYD Trust

was not obligated to sell its limited partnership interest in MA

to Alexander or any other partners of McCully Associates.

On October 25, 2010, the circuit court entered a

partial final judgment for both the Buyout and Judicial

Accounting cases. As to the Buyout case, the circuit court

entered a judgment in favor of the AYD Trust, holding that the

AYD Trust was not obligated to sell its partnership interest to

any of the MA partners and denying Alexander’s claim for specific

performance. The circuit court also awarded the AYD Trust

attorneys’ fees and costs in the sum of $54,498.44. As to the

Judicial Accounting case, the circuit court held that MA and Ala

Wai Investment, Inc. were to be dissolved and the assets

liquidated.

B. ICA Proceedings

On March 28, 2015, Alexander filed an amended opening

brief before the ICA and raised nine points of error on appeal.

Relevant to our review is Alexander’s second point, which argued

that the circuit court erred in conducting a bench trial instead

of a jury trial in the Buyout case.7 Alexander argued that the

7
Alexander also argued that he was entitled to a jury trial for the
Judicial Accounting case. However, Alexander did not raise that argument in
his application for writ of certiorari.

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Buyout case was an action for declaratory judgment because it

requested that the court determine the parties’ rights under the

Partnership Agreement and was, “therefore an action on a

contract.” Alexander contended that, as an action for

declaratory judgment, the Buyout case should have been tried by

jury pursuant to Hawai#i Rules of Civil Procedure (HRCP) Rule 57.

In its answering brief, the AYD Trust made three

arguments as to why Alexander was not entitled to a jury trial

for the Buyout case. First, the AYD Trust argued that, as an

action for specific performance without a claim for damages, the

Buyout case was purely equitable and rightly tried by the court

instead of by a jury. Second, the AYD Trust argued that

Alexander waived the issue because he never demanded a jury trial

for the Buyout case, and also made no objections at the trial

court level when a bench trial was ordered by the court. Third,

the AYD Trust contended that “even if [Alexander] had shown a

proper objection, and a right to a jury trial, the issue of a

buyout of the AYD Trust’s [sic] . . . is now moot. . . . [because

McCully Associates] was dissolved by operation of law.”

In his reply, Alexander argued that, while he did not

demand a jury trial in the Buyout case, the AYD Trust made such a

demand in its December 4, 1998 answer to the complaint and in its

December 11, 1998 first amended answer to the complaint.

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Alexander contended that pursuant to HRCP Rule 38(d), the AYD

Trust’s demand for a jury trial could not be withdrawn without

the consent of the parties, which never occurred.

On February 26, 2016, the ICA entered a memorandum

opinion affirming the circuit court’s October 25, 2010 partial

final judgment on all counts. Relevant to our review is the

ICA’s disposition of Alexander’s argument that the circuit court

erred in not affording Alexander a jury trial in the Buyout case.

First, the ICA explained that the Hawai#i Constitution

and HRCP Rule 38(a) provide a right to a jury trial in suits at

common law. In order to determine whether a suit is “at common

law” the ICA noted that courts look to the nature of the remedy,

specifically whether the cause of action seeks “legal” or

“equitable” relief. The ICA further explained that claims for

specific performance are equitable in nature and are not claims

arising at common law. The ICA did not address whether an action

for declaratory judgment was legal or equitable.

The ICA then examined Alexander’s claim in the Buyout

case, and concluded that the “sole remedy [Alexander] sought was

specific performance.” The ICA cited to Alexander and Eric’s

circuit court complaint, which stated that they had “no adequate

remedy at law, because the underlying asset of the Partnership is

real property, the loss of which cannot be adequately compensated

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by damages.” As such, the ICA held that Alexander was not

entitled to a jury trial in the Buyout case.8

On March 23, 2016, the ICA entered a judgment on

appeal, which affirmed the circuit court’s October 25, 2010

partial final judgment.

III. STANDARDS OF REVIEW

A. Jury Trial

The denial of a demand for jury trial is a question of

law reviewable de novo. Credit Assocs. of Maui, Ltd. v. Brooks,

90 Hawai#i 371, 372, 978 P.2d 809, 810 (1999).

B. Mootness

Mootness is an issue of subject matter jurisdiction.

“Whether a court possesses subject matter jurisdiction is a

question of law reviewable de novo.” Cty. of Hawai#i v. Ala Loop

Homeowners, 123 Hawai#i 391, 403-04, 235 P.3d 1103, 1115-16

(2010) (quoting Hamilton ex rel. Lethem v. Lethem, 119 Hawai#i 1,

4-5, 193 P.3d 839, 842-43 (2008)).

IV. DISCUSSION

The sole question before this court is whether the ICA

erred in affirming the circuit court’s decision to hear this case

8
The ICA also held that Alexander was not entitled to a jury trial
in the Judicial Accounting case because “[a] judicial accounting is equitable
in nature.”

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without a jury. In short, Alexander argues that he was entitled

to a jury trial because he raised claims for declaratory relief.

In turn, the AYD Trust argues that Alexander waived this argument

by not raising it at the circuit court level, that the argument

is now moot, and that the ICA correctly ruled that Alexander had

no right to a jury trial. We address each of those arguments in

turn.

A. The Jury Trial Issue was Properly Preserved at the Circuit
Court and ICA Levels.

Hawai#i Revised Statutes (HRS) § 641-2 (Supp. 2004)

provides that the “appellate court may correct any error

appearing on the record, but need not consider a point that was

not presented in the trial court in an appropriate manner.” See

also Okuhara v. Broida, 51 Haw. 253, 255, 456 P.2d 228, 230

(1969) (“[W]e are restricted in granting relief because of the

rule in this jurisdiction which prohibits an appellant from

complaining for the first time on appeal of error to which he has

acquiesced or to which he failed to object.”).

The AYD Trust argues that the issue before this court

is waived because Alexander did not object to the bench trial at

the circuit court level. However, it does appear from the record

that both Eric and Alexander expressed objections to having a

bench trial for the Buyout case at the circuit court level.

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For example, after the Receiver filed a motion to

strike the jury trial for the Buyout case, Eric filed a motion in

opposition in which Alexander joined. Additionally, during the

August 2005 pretrial hearing, Eric Marn’s attorney argued that a

jury trial should be preserved for the Buyout case. Thus, the

record does indicate that both Eric and Alexander objected to

having a bench trial for the Buyout case, and that the issue of

trial by jury was discussed during a pretrial hearing. See Lii

v. Sida of Hawai#i, Inc., 53 Haw. 353, 355, 493 P.2d 1032, 1034

(1972) (“We consider the right to a jury trial to be inviolate in

the absence of an unequivocal and clear showing of a waiver of

such right either by express or implied conduct. This court will

indulge every reasonable presumption against the waiver of such

right.”).

For this reason, the AYD Trust’s argument that the

issue is now waived is unpersuasive.

B. The Jury Trial Issue is Not Moot.

This court has stated that “[a] case is moot if it has

lost its character as a present, live controversy of the kind

that must exist if courts are to avoid advisory opinions on

abstract propositions of law.” Ala Loop Homeowners, 123 Hawai#i

at 405, 235 P.3d at 1117 (quoting Kona Old Hawaiian Trails Grp.

v. Lyman, 69 Haw. 81, 87, 734 P.2d 161, 165 (1987)). As a

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general rule, a “case is moot if the reviewing court can no

longer grant effective relief.” Id. (quoting Kaho#ohanohano v.

State, 114 Hawai#i 302, 332, 162 P.3d 696, 726 (2007)). “Stated

another way, the central question before us is whether changes in

the circumstances that prevailed at the beginning of litigation

have forestalled any occasion for meaningful relief.” Gator.com

Corp. v. L.L. Bean, Inc., 398 F.3d 1125, 1129 (9th Cir. 2005)

(internal quotation marks and citations omitted).

The AYD Trust argues that the “issue of Petitioners’

entitlement to a jury trial regarding the determination of rights

of the MA limited partners under the Transfer Restriction

Agreement is moot because . . . such determination would not

serve any valid purpose in light of the fact that MA has already

been dissolved and its assets liquidated.”

Alexander argues that, while MA has been dissolved and

its assets liquidated,9 there has yet to be a final accounting of

the proceeds or a determination of the distribution of the

proceeds to the partners. As such, Alexander contends that the

outcome of the Buyout case would determine each partner’s

interest in the proceeds.

To the extent that Alexander is still seeking to

9
Alexander does not appear to dispute that MA has been dissolved
and its assets sold.

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acquire Annabelle’s interest in MA or MA property, that relief

appears to be unavailable because MA no longer exists and the

property has been sold. However, to the extent that Alexander is

seeking other relief at this point, perhaps in the form of

proceeds from the sale of MA and its properties, the issue is not

moot and can be considered by this court. See In re Gentry

Revocable Tr., 138 Hawai#i 158, 171-72, 378 P.3d 874, 887-88

(2016) (stating that a case is not moot, even when the assets at

issue have already been sold, if the proceeds from the sale have

yet to be distributed). In short, a court could still grant

Alexander effective relief in the form of a greater share in the

proceeds generated from MA’s dissolution. Thus, Alexander’s

claim is not moot.

C. Alexander Has a Right to a Jury Trial in the Buyout Case.

There are two aspects to the jury trial issue. The

first is whether Alexander was entitled to a jury trial in the

Buyout case. If he was entitled to a jury trial, the second

question is whether trial by jury was properly demanded and

preserved.

1. Alexander was entitled to a trial by jury in the
Buyout case because he requested legal relief in
the form of a declaratory judgment.

Article 1, section 13 of the Hawai#i Constitution

mandates that “[i]n suits at common law where the value in

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controversy shall exceed five thousand dollars, the right of

trial by jury shall be preserved.” See also HRCP Rule 38(a)

(“The right of trial by jury as given by the Constitution or a

statute of the State or the United States shall be preserved to

the parties inviolate.”).

As the Hawai#i Constitution notes, the right to a jury

trial is preserved for suits at common law. “The test to

determine whether a suit is at common law is . . . whether the

cause of action seeks legal or equitable relief.” Lee v. Aiu, 85

Hawai#i 19, 29, 936 P.2d 655, 665 (1997) (internal quotation

marks omitted). Thus, “courts look to the nature of the remedy

to determine whether a jury trial is warranted.” Id.

In its memorandum opinion, the ICA concluded that

Alexander was not entitled to a jury trial in the Buyout case

because “the sole remedy Marn sought was specific performance[,]”

which at common law was a claim in equity. Alexander argues that

he was entitled to a jury trial in the Buyout case because he

also sought a declaratory judgment concerning his rights under

the Partnership and Transfer Agreements, and that this was an

action for legal relief.

Alexander’s argument has merit. Hawai#i law preserves

the right to trial by jury for declaratory judgments. First,

actions for declaratory judgments are provided for in HRS § 632-1

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(1993), which states in part that “[r]elief by declaratory

judgment may be granted in civil cases where an actual

controversy exists between contending parties . . . and the court

is satisfied also that a declaratory judgment will serve to

terminate the uncertainty or controversy giving rise to the

proceeding.”10 See also Island Ins. Co., Ltd. v. Perry, 94

10
HRS § 632-1 provides in full:

Jurisdiction; controversies subject to. In cases of actual
controversy, courts of record, within the scope of their
respective jurisdictions, shall have power to make binding
adjudications of right, whether or not consequential relief
is, or at the time could be, claimed, and no action or
proceeding shall be open to objection on the ground that a
judgment or order merely declaratory of right is prayed for;
provided that declaratory relief may not be obtained in any
district court, or in any controversy with respect to taxes,
or in any case where a divorce or annulment of marriage is
sought. Controversies involving the interpretation of deeds,
wills, other instruments of writing, statutes, municipal
ordinances, and other governmental regulations, may be so
determined, and this enumeration does not exclude other
instances of actual antagonistic assertion and denial of
right.

Relief by declaratory judgment may be granted in civil cases
where an actual controversy exists between contending
parties, or where the court is satisfied that antagonistic
claims are present between the parties involved which
indicate imminent and inevitable litigation, or where in any
such case the court is satisfied that a party asserts a
legal relation, status, right, or privilege in which the
party has a concrete interest and that there is a challenge
or denial of the asserted relation, status, right, or
privilege by an adversary party who also has or asserts a
concrete interest therein, and the court is satisfied also
that a declaratory judgment will serve to terminate the
uncertainty or controversy giving rise to the proceeding.
Where, however, a statute provides a special form of remedy
for a specific type of case, that statutory remedy shall be
followed; but the mere fact that an actual or threatened
controversy is susceptible of relief through a general
common law remedy, a remedy equitable in nature, or an
extraordinary legal remedy, whether such remedy is
(continued...)

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Hawai#i 498, 502, 17 P.3d 847, 851 (App. 2000) (“Actions for

declaratory judgments are authorized by Hawai#i Revised Statues

(HRS) § 632-1 (1993).”).

Second, HRCP Rule 57, titled “Declaratory Judgments,”

provides that a jury trial may be requested in actions for a

declaratory judgment:
The procedure for obtaining a declaratory judgment pursuant
to statute shall be in accordance with these rules, and the
right to trial by jury may be demanded under the
circumstances and in the manner provided in Rules 38 and 39.
The existence of another adequate remedy does not preclude a
judgment for declaratory relief in cases where it is
appropriate, except that declaratory relief may not be
obtained in any controversy with respect to taxes.

Third, Hawai#i case law has preserved the right to a

jury trial in declaratory actions. For instance, in Kimball v.

Lincoln, 72 Haw. 117, 809 P.2d 1130 (1991), this court considered

the issue of right to jury trial in actions for specific

performance and declaratory judgment. At issue in Kimball was

whether there was a valid lease of agricultural land. 72 Haw. at

118-19, 809 P.2d at 1131. The plaintiff sought both a

declaration that the lease was valid and specific performance in

enforcing the lease. Id.

In deciding whether there was a right to jury trial in

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(...continued)
recognized or regulated by statute or not, shall not debar a
party from the privilege of obtaining a declaratory judgment
in any case where the other essentials to such relief are
present.

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Kimball, this court first addressed the claim for specific

performance:
Appellant’s claim for specific performance is clearly
equitable in nature and not a claim arising at common law.
Accordingly, appellant had no right to demand a jury trial
of the claim for specific performance under HRCP 38(b) since
the right to demand a jury trial is expressly limited to
issues triable of right by a jury under that rule.

Id. at 126, 809 P.2d at 1134.

In contrast, this court noted that “[t]he declaratory

judgment count stands on a different footing.” Id. This court

further explained:
This count . . . raise[s] questions of whether a lease was
in fact intended to be entered into, and whether there was a
sufficient meeting of the minds of the parties on all the
material terms of the lease to constitute a contract. These
are legal issues, historically tried at common law in
assumpsit or, in some cases, in covenant.

Id. at 126, 809 P.2d at 1134-35. This court concluded that

“[c]learly, the issues raised by the complaint for declaratory

relief are legal issues, triable of right by a jury[.]” Id.

Similarly, in this case, Alexander requested both a

declaratory judgment and specific performance. Under the former,

Alexander sought a declaration of his rights, and the rights of

the other MA partners, under the Partnership and Transfer

Agreements. As this court concluded in Kimball, such issues are

legal in nature. 72 Haw. at 126, 809 P.2d 1134-35.

As such, it appears that Alexander was entitled to a

jury trial in the Buyout case. The ICA erred by focusing

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exclusively on the specific performance aspect of Alexander’s

complaint without examining his claim for declaratory relief.

Next, we address whether a trial by jury was properly demanded

and preserved in this case.

2. Trial by jury was properly demanded and preserved
in the Buyout case.

HRCP Rule 38 provides the procedural mechanism for

demanding and waiving a trial by jury. HRCP Rule 38(b) and (d)

provide in relevant part:
(b) Demand. Any party may demand a trial by jury of any
issue triable of right by a jury by (1) serving upon the
other parties a demand therefor in writing at any time after
the commencement of the action and not later than 10 days
after the service of the last pleading directed to such
issue, and (2) filing the demand as required by Rule 5(d). .
. .
(d) Waiver. The failure of a party to serve and file a
demand as required by this rule and to file it as required
by Rule 5(d) constitutes a waiver by the party of trial by
jury. A demand for trial by jury made as herein provided
may not be withdrawn without the consent of the parties.

Pursuant to HRCP Rule 38(b), the AYD Trust filed a

demand for jury trial in the Buyout case twice: first with its

answer to the complaint on December 4, 1998, and second with its

first amended answer to the complaint on December 11, 1998. It

appears from the record that there were no deficiencies as to

timing or service of process. Thus, a trial by jury was properly

demanded in the Buyout case when the AYD Trust filed its December

4, 1998 and December 11, 1998 demands; Alexander did not need to

file his own jury demand to preserve this right. See Mehau v.

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Reed, 76 Hawai#i 101, 112, 869 P.2d 1320, 1331 (1994) (“[I]t is

well settled in this jurisdiction that when either of the

litigating parties properly demanded jury, it fixed the status of

the case and the other party was not required to file his [or

her] own demand.”) (internal quotation marks and citations

omitted).

As to HRCP Rule 38(d), no citation to the record has

been provided that shows that the demand for jury trial was

withdrawn with the consent of the parties. In fact, in its

briefings before this court and the ICA, the AYD Trust does not

address Alexander’s contentions that the jury demand was never

withdrawn. Additionally, on the October 5, 1999 and February 1,

2002 order setting trial, the Buyout case was designated as a

jury trial. Because a trial by jury was demanded for the Buyout

case and because this demand was never withdrawn once it was

made, a trial by jury was properly preserved under HRCP Rule 38.

Confusion over the jury trial arose in August of 2005,

when a pretrial hearing was held. At that hearing, Eric Marn’s

attorney, Mr. Sakai, argued that there should be a trial by jury

while Dunn’s attorney, Mr. Guttman, argued that a jury trial had

not been requested for this case:
[MR. SAKAI]: Your Honor, if I may address and add to what
Mr. Guttman and Mr. Freed said is we believe that another –-
the third issue would be ripe for the Court’s adjudication
without being enmeshed in the I.R.S. criminal investigation

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would be the buy-out. . . .
But the buy-out is very isolated, and it’s very clean,
your Honor, very clean. And I think that requires a very
short jury trial that, basically, there’s not too much for
the jury to determine. I think the factual issues are
there. If they want to do a stipulated facts, we can do
that, but I –- I don’t think they want to do that. So we
need a jury to determine the facts of the case, but I think
that’s a –- a document that cries out to be adjudicated
separate and apart from the I.R.S. issue.
The buy-out is very important, and it could have
significant impact upon the current mediation right now.
I’m only talking about the Dunn –-
. . .
[MR. GUTTMAN]: There was no jury demand. There is no right
to a jury at this date to be requesting a jury. I –- I
think in terms of the factual issues, 90 percent to the
facts, I don’t think there’s any disagreement. I think the
– the actual facts are –- are very narrow that that [sic]
are in dispute.

(Emphasis added). The circuit court agreed with Dunn’s attorney

and concluded that “there was no separate jury demand in the buy-

out.” Then, in November 2006, the court entered another order

setting trial, in which the box entitled “Jury-waived” was

checked.

In summary, Alexander was entitled to a jury trial for

the Buyout case. In the early stages of the litigation, a jury

trial was properly demanded, preserved, and designated for the

Buyout case. Years later, during a pretrial hearing, it was

represented to the court that there had been no jury demand for

the Buyout case. The circuit court erred when it agreed and re-

designated the case as a jury-waived trial.

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V. CONCLUSION

For the reasons stated above, the ICA’s March 23, 2016

judgment on appeal, which affirmed the circuit court’s

October 25, 2010 partial final judgment, is vacated and remanded

on the ground that Alexander was entitled to a trial by jury.

This holding does not disturb the ICA’s judgment as to

Alexander’s other points, as these points were not raised to or

reviewed by this court.

Alexander Y. Marn, /s/ Mark E. Recktenwald
individually, and Alexander Y.
Marn, and Ernestine L. Marn, /s/ Paula A. Nakayama
as Co-trustees of the Revocable
Living Trust Agreement of /s/ Sabrina S. McKenna
Alexander Y. Marn, petitioners-
pro se /s/ Richard W. Pollack

Steven Guttman and Dawn Egusa /s/ Michael D. Wilson
for James. K. M. Dunn, as
Successor Trustee of the
Annabelle Y. Dunn Trust,

Mark B. Desmarais for
James Y. Marn, Jr.

Louise K.Y. Ing and Zachary M.
DiIonno for Liquidating
Receiver S. Steven Sofos

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