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NOBORU TAKAYAMA, Plaintiff/Countercla1m- ““ W3
Defendant/Appellant/Cross-Appellee, v. WARREN ZERA,
Defendant/Counterclaim-Plaintiff/Appellee/Cross-Appellant
APPEAL FROM THE DlSTRICT COURT OF THE FIRST ClRCUIT
HONOLULU DIVISION
(ClVlL NO. lRCO5-l-O336l)
SUMMARY DISPOSITION ORDER
(By: Nakamura, C.J., Foley and Fujise,
Plaintiff/Counterclaim-Defendant/Appellant/Cross-
JJ.)
Appellee Noboru Takayama (Takayama) appeals from the March 24,
2006 final judgment of the District Court of the First Circuit,
Honolulu Division (district court)1 in favor of
Defendant/Counterclaim-Plaintiff/Appellee/Cross-Appellant Warren
Zera (Zera). Zera cross-appeals from the same judgment.
After a careful review of the issues raised, arguments
advanced, applicable law, and the record in the instant case, we
resolve the parties' appeals as follows:
A. Takayama's P0ints of Error
Takayama argues that the district court erred in (l)
denying Takayama's motion to continue trial; (2) failing to amend
the complaint to conform to the evidence presented at trial;
(3) allowing Zera to testify as to the value of his sound and
lighting equipment; (4) allowing Zera to testify as to the value
of his diamond and opal rings; (5) informing Zera he should not
withdraw his claims for intentional and negligent infliction of
emotional distress and awarding damages for negligent infliction
of emotional distress after Zera had already gone on the record
as withdrawing those claims; (6) awarding reasonable attorney's
1 The Honorable Peter T. Stone presided.
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fees over the twenty-five percent maximum allowed under Hawaii
Revised Statutes (HRS) § 607~14 (Supp. 2009), and failing to
designate the statutory grounds for which attorney's fees were
awarded and the specific amounts awarded with respect to each
ground; and (7) failing to stay the execution of judgment pending
appeal.
l. Motion for Continuance
The district court did not abuse its discretion when it
denied Takayama's second motion for continuance. "Ordinarily,
the granting or denial of a continuance is a matter that is
addressed to the sound discretion of the trial court and is not
subject to reversal on appeal absent a showing of abuse." Ling
v. Yokoyama, 91 HawaiT.l3l, l32, 980 P.2d lOO5, lO06 (App. l999)
(internal quotation marks and citations omitted). In denying
Takayama's second motion to continue, the district court
appropriately concluded that, "[s]ufficient time has passed for
both counsel to be ready for trial," especially considering that
the case "was set for trial quite sometime ago," and the opposing
party was ready to proceed. See Stender v. Vincent, 92 Hawafi
355, 370, 992 P.2d 50, 65 (2000); Bank of Hawaii v. Shaw, 83
Hawai‘i 50, 58, 924 P.zd 544, 552 (App. 1996).
2. Amendments to Conform to Evidence
Contrary to Takayama's claims, the district court
amended the complaint to conform to the evidence, and ruled with
respect to the issue of non-payment of rent when it specifically
stated during trial that "the Court is amending all pleadings to
conform to the evidence admitted in trial" and found and ruled in
its March 24, 2006 "Amended Order Granting [Zera's] Request for
Costs, Attorney's Fees and Entry of Judgment" that "[o]n
February 9, 2006 the Court dismissed [Takayama's]
Complaint/Amended Complaint, finding no legal basis for claim of
abandonment and that no rent was due, and pursuant to [HRS]
§ 607-l4(c) awarded [Zera] his legal costs and a reasonable
amount for his attorney's fees." (Emphasis added.)
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3. Opinion Testimony
The district court did not abuse its discretion when it
allowed Zera’s testimony as to the value of his equipment and his
jewelry, which was allegedly lost or taken from his apartment.
"1n Hawaii, admission of opinion evidence is a matter within the
discretion of the trial court, and only an abuse of that
discretion can result in reversal[,]" State v. Tucker, 10 Haw.
App. 73, 89, 861 P.2d 37, 46 (1993), and Hawaii Rules of Evidence
(HRE) Rule 701 "sets forth a liberal standard for admitting lay
opinions into evidence." State v. Jenkins, 93 Hawafi 87, 105,
997 P.2d l3, 31 (2000).
Though Takayama claims that Zera lacked the requisite
personal knowledge to render a valuation opinion, we disagree.2
As to the value of Zera's sound and lighting equipment, Zera
testified that he was a professional lighting and special effects
designer/operator and that he owned considerable sound and
lighting equipment ("tools of my trade").
As to the value of Zera's jewelry, namely a diamond
ring and an opal stone pried from a ring, Zera testified that he
worked with a diamond investment company in the past, where he
received diamond valuation training, and that he consulted with a
professional jeweler, who tested him with some stones, to "check"
himself. As such, it appears that Zera's valuation testimony was
rationally based upon his perceptions, given his knowledge of
sound and lighting equipment as well as his knowledge of
gemstones.
4. Negligent Infliction of Emotional Distress Claim
The district court did not commit plain error when it
(a) informed Zera he should not withdraw his claims for
intentional and negligent infliction of emotional distress, after
Zera had withdrawn those claims on the record, and (b) awarded
2 In addition to arguing that it was error to permit Zera to render a
lay valuation opinion, Takayama also argues that it was error to permit Zera
to render an expert valuation opini0n; however, inasmuch as Zera was never
offered/qualified as an expert witness, this argument is without basis in the
record.
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damages for negligent infliction of emotional distress. "An
appellate court will apply the plain error standard of review to
correct errors which seriously affect the fairness, integrity, or
public reputation of judicial proceedings, to serve the ends of
justice, and to prevent the denial of fundamental rights." In re
IQ, l2l Hawaifi 92, 98, 214 P.3d lO82, lO88 (App. 2009) (internal
quotation marks and citations omitted). However,
[t]his court's power to deal with plain error is one to be
exercised sparingly and with caution because the plain error
rule represents a departure from a presuppositi0n of the
adversary system--that a party must look to his or her
counsel for protection and bear the cost of counsel's
mistakes.
State v. KelekOliO, 74 HaW. 479, 5l5, 849 P.2d 58, 74-75 (l993).
Despite Takayama‘s contention that the district court
acted inappropriately, it appears that the district court sought
to clarify a possible misunderstanding of its preliminary ruling.
While Takayama claims that, "[o]nce a party decides to withdraw a
claim, the court may not inquire into the reasons for that
decision," Takayama cites no authority for such proposition.
As for Takayama's claim that the district court erred
when it awarded damages for negligent infliction of emotional
distress, Takayama does not present a discernable argument
regarding this point in his opening brief,3 therefore, pursuant
to Hawafi Rules of Appellate Procedure (HRAP) Rule 28(b)(7),
this point is deemed waived. Takayama did provide some argument
in his reply brief, however, it would be unfair to address it.
See Tauese v. State, Dep't of Labor & Indus. Relations, 113
Hawafi l, 29, 147 P.3d 785, 813 (2006); HRAP Rule 28(d) (Court
delclined to address argument in reply brief on issue waived in
opening brief).
5. Attorney's Fees
The district court did not abuse its discretion when it
awarded reasonable attorney's fees over the twenty~five percent
3 Takayama merely posits that the district court "made an unsupported
ruling in favor of [Zera]."
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maximum allowed under HRS § 607-14, and contrary to Takayama's
claims, the district court did specify the statutory grounds for
which attorney's fees were awarded and the specific amounts
awarded with respect to each ground. "The trial court's grant or
denial of attorney's fees and costs is reviewed under the abuse
of discretion standard." Sierra Club v. Dep't of Transp., State
of Hawaii, 120 Hawafi l8l, l97, 202 P.3d 1226, 1242 (2009)
(internal quotation marks, citations, and brackets omitted).
In granting count 1 of Zera's counterclaim, the
district court properly awarded Zera reasonable attorney's fees
pursuant to HRS § 521-63(c) (1993).4 1n count 1 of Zera's
counterclaim, Zera alleged unlawful recovery of possession in
violation of the Residential Landlord-Tenant Code, HRS § 521, as
well as unfair and deceptive practices in violation of the Unfair
and Deceptive Trade Practices Act, HRS § 480-2. The district
court found that Takayama unlawfully recovered possession of the
premises in violation of HRS § 521-63(c), which allowed Zera to
recover “the cost of suit, including reasonable attorney's fees"
without limitation.
The district court's March 24, 2006 "Amended Order
Granting [Zera's] Request for Costs, Attorney's Fees and Entry of
Judgment" methodically states the statutory authority and amount
of the attorney's fee award in each count of Zera's counterclaim.
Takayama asserts, in his reply brief, that he was never served
with a copy of the order, which appears to be true based on a
review of the record; however, Takayama has not shown prejudice
from such omission.
4 HRS § 521-63(c) states in relevant part:
1f the landlord removes or excludes the tenant from the
premises overnight without cause or without court order so
authorizing, the tenant may recover possession or terminate
the rental agreement and, in either case, recover an amount
equal to two months rent or free occupancy for two months,
and the cost of suit, including reasonable attorney's fees.
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6. Stav of Execution of Judgment Pending ApDeal
The district court did not abuse its discretion when it
denied Takayama's motion for a stay pending appeal. "[T]he rule
and the inherent discretion and power of the trial court allow
for flexibility in the determination of the nature and extent of
the security required to stay the execution of the judgment
pending appeal.“ Shanghai 1nv. Co., 1nc. v. Alteka Co.J Ltd., 2
HawaiU.482, 503, 993 P.2d 516, 537 (2000) (internal quotation
marks and citation omitted), overrulled on other grounds by §lai;
v. 1ng, 96 HawaiU_327, 31 P.3d 184 (2001). Although Zera had
already taken steps to garnish an amount equal to 120% of the
judgment against Takayama, the district court found this
insufficient as security and required a supersedeas bond or cash
equivalent to 150% of the judgment. Takayama provided neither.
Under the circumstances of this case, we conclude the district
court did not abuse its discretion in requiring such security.
Furthermore, it appears that Zera filed a satisfaction
of judgment on July 26, 2006, making the stay issue moot. §ity
Bank v. Saje Ventures 11, 7 Haw. App. 130, 134, 748 P.2d 812, 815
(1988) ("[A] case is moot if the reviewing court can no longer
grant effective relief.") (internal quotation marks and citation
omitted).
B. Zera's Points of Error
Zera argues that the district court erred in
(1) denying Zera's motion for summary judgment as to counterclaim
counts 1 and 11; (2) denying Zera's claims of unfair and
deceptive practices; (3) denying Zera's claim for punitive
damages; (4) denying Zera's claim that Takayama's complaint and
first amended complaint were frivolous; and (5) limiting Zera's
award of attorney's fees pursuant to HRS § 607-14.
1. Motion for Summarv Judgment
The district court's denial of summary judgment as to
counts 1 and 11 of Zera's counterclaim was harmless error. The
trial court's grant or denial of summary judgment is reviewed by
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the appellate courts de novo. Querubin v. Thronas, 107 Hawafi
48, 56, 109 P.Bd 689, 697 (2005).
"Summary judgment is proper where the moving party
demonstrates that there are no genuine issues of material fact
and it is entitled to a judgment as a matter of law." 1ddings v.
Mee-Lee, 82 Hawafi 1, 5, 919 P.2d 263, 267 (1996). Once the
moving party satisfies the burden of showing that there is no
genuine issue of material fact, the opposing party must provide
the court with specific facts showing that there is a genuine
issue of material fact for the court to adjudicate or summary
judgment will be granted. French v. Hawaii Pizza Hut, 1nc., 105
Hawai‘i 462, 470, 99 P.3d l046, 1054 (2004). (quot'ing GECC Fin.
Corp. v. Jaffarian, 79 HawaFi 516, 521, 904 P.2d 530, 535 (App.
1995)). "[S]ummary judgment should not be granted unless the
entire record shows a right to judgment with such clarity as to
leave no room for controversy and establishes affirmatively that
the adverse party cannot prevail under any circumstances."
Balthazar v. Verizon Hawaii, 1nc., 109 Hawafi 69, 72, 123 P.3d
194, 197 (2005) (internal quotation marks and citations omitted).
With regards to Zera's "illegal lockout" claim under
HRS § 521-63(c), Zera was required to show that there was no
genuine issue of material fact that “the landlord remove[d] or
exclude[d] the tenant from the premises overnight without cause
or without court order." 1n Zera's motion for summary judgment,
which was supported by admissible evidence and was unopposed by
Takayama, Zera alleged that on May 27, 2005, Takayama mailed Zera
a notice to vacate the apartment within thirty days (although a
45 day notice was required, see HRS § 521-71(a) (Supp. 2005)) and
on June 26, 2005, Takayama changed the locks to the apartment
without court order, causing Zera to be locked out overnight. As
such, summary judgment as to this claim was seemingly warranted.
However, it was harmless error because Zera prevailed on this
claim at trial and did not allege any harm from the denial.
As for Zera's "bad faith claim of abandonment" claim
under HRS §§ 521-10 and 521-44(d) and "failure to secure [Zera's]
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possessions" claim under HRS § 521-73(b)(3), summary judgment
would not have been appropriate.
[Q]uestions of reasonableness of conduct and good
faith are ordinarily for the judgment of the triers of the
facts. [Broad & Branford Place Corp. v. J.J. Hockenjos Co.,
132 N.J.L. 229, 232, 39 A.2d 80, 82 (1944)] 1nasmuch as the
term reasonableness is subject to differing interpretations
(i.e., is relative and not readily definable), it is
inherently ambiguous. where ambiguity exists, summary
judgment is usually inappropriate because the determination
of someone's state of mind usually entails the drawing of
factual inferences as to which reasonable men might differ.
. . However, reasonableness can constitute a question of
law for the court when the facts are undisputed and not
fairly susceptible of divergent inferences because, where,
upon all the evidence, but one inference may reasonably be
drawn, there is no issue for the jury.
Amfac, 1nc. v. Waikiki Beachcomber 1nv. Co., 74 Haw. 85, 107-08,
839 P.2d 10, 23-24 (1992) (internal quotation marks, original
brackets, and some citations omitted). Both of these claims
involve a determination of Takayama's reasonableness, and more
than one inference may reasonably be drawn from the evidence
presented by Zera in support of these claims.
Finally, as for Zera's "unfair deceptive acts" claim
(HRS § 480-2), denying summary judgment was proper for the
reasons discussed below.
2. HRS § 480-2 Claims
The district court did not err when it denied Zera's
claims pursuant to HRS § 480-2 (2008). The interpretation of a
statute is a question of law which the appellate court reviews de
novo. Sierra Club, 120 Hawafi at 197, 202 P.3d at 1242. "[A]
trial court's FOFs are subject to the clearly erroneous standard
of review." Chun v. Bd. of 1rs. of the Emp1ovees Ret. Sys. of
the state of Hawai‘i, 106 Hawai‘i 416, 430, 106 P.:ad 339, 353
(2005) (citation omitted).
Although not raised before the district court, Zera
lacks the requisite standing to bring his HRS § 480~2 claims. A
defect in standing precludes this court from reaching Zera's
merit~based challenges "because standing is concerned with
whether the parties have the right to bring suit." 1ndyMac Bank
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v. Miguel, 117 Hawafi 506, 512, 184 P.3d 821, 827 (App. 2008)
(internal quotation marks, brackets, and citation omitted).
HRS § 480-2(d) states that "[n]o person other than a
consumer, the attorney general or the director of the office of
consumer protection may bring an action based upon unfair or
deceptive acts or practices declared unlawful by this section."
HRS § 480-1 (2008) defines a "consumer" as "a natural person who,
primarily for personal, family, or household purposes, purchases,
attempts to purchase, or is solicited to purchase goods or
services or who commits money, property, or services in a
personal investment."
Zera's lease was neither a purchase of goods or
services nor a personal investment. Cieri v. Leticia Querv
Realty, 1nc., 80 Hawafi 54, 66, 905 P.2d 29, 41 (1995) "real
estate or residences do not qualify as 'goods' under HRS § 480-
1"); Black‘s Law Dictionarv 1491 (9th ed. 2009) (defining
"personal service" as "an economic service involving either the
intellectual or manual personal effort of an individual, as
opposed to a salable product of the person's skill."); Joy A.
McElroV, M.D., 1nc. v. Maryl Group, 1nc., 107 Hawafi 423, 436,
114 P.3d 929, 942 (App. 2005) ("the concept of 'investment'
includes an expectation of 'profitable returns'"). Therefore,
Zera does not have standing as a "consumer" under HRS chapter
480, and could not bring his HRS § 480-2 claims.
3. Punitive Damages
The district court did not abuse its discretion when it
denied Zera's claim for punitive damages. "An award or denial of
punitive damages is within the sound discretion of the trier of
fact. Absent a clear abuse of discretion, we will not reverse a
trier of fact's decision to grant or deny punitive damages."
Udac v. Takata Corp., 121 Hawafi 143, 149, 214 P.3d 1133, 1139
(App. 2009) (internal quotation marks, brackets, and citations
omitted).
1n determining whether an award of punitive damages is
appropriate, the inquiry focuses primarily upon the
defendant‘s mental state, and to a lesser degree, the nature
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of his or her conduct. To justify an award of punitive
damages, a positive element of conscious wrongdoing is
always required. Thus, punitive damages are not awarded for
mere inadvertence, mistake, or errors of judgment.
1d., 121 Hawafi at 165, 214 P.3d at 1155 (internal quotation
marks, brackets, ellipsis, and citations omitted). 1n order to
establish a claim for punitive damages,
[t]he plaintiff must prove by clear and convincing evidence
that the defendant has acted wantonly or oppressively or
with such malice as implies a spirit of mischief or criminal
indifference to civil obligations, or where there has been
some wilful misconduct or that entire want of care which
would raise the presumption of a conscious indifference to
consequences.
1d; at 166, 214 P.3d at 1156 (citation omitted). Clear and
convincing evidence generally requires evidence that "will
produce in the mind of a reasonable person a firm belief as to
the facts sought to be established." A1meida v. Almeida, 4 Haw.
App. 513, 518, 669 P.2d 174, 179 (1983) (internal quotation marks
and citation omitted).
Here, the district court thoroughly examined the issue
of punitive damages during trial, and essentially characterized
Takayama's actions as a mistake, i.e., a misapplication and/or
misunderstanding of the law, rather than intentional misconduct,
apparently based on the lack of evidence of Takayama's knowledge
of wrongdoing as well as Takayama's admissions that he committed
errors of judgment. Accepting the district court's credibility
assessment, State v. Mitchell, 94 HawaiH.388, 401, 15 P.3d 314,
327 (App. 2000), and reviewing the evidence presented pertaining
to the issue of punitive damages, we cannot say that the district
court exceeded its discretion in concluding that the evidence did
not warrant an award of punitive damages.
4. Frivolous Complaint/Amended Complaint
The district court did not err when it denied Zera's
claim that Takayama's complaint and amended complaint were
frivolous, namely awarding fees "based on 607-14, not 14.5." The
district court's conclusion that Takayama's complaint and first
amended complaint were not frivolous presents mixed questions of
fact and law. "Where the court's conclusions are dependent upon
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the facts and circumstances of each individual case, the clearly
erroneous standard of review applies." Coll v. McCarthy, 72 Haw.
20, 28, 804 P.2d 881, 886 (1991).
"A frivolous claim is one manifestly and palpably
without merit, so as to indicate bad faith on the pleader's part
such that argument to the court was not required." Lee v. Hawaii
Pacific Health, 121 HawaiU.235, 246, 216 P.3d 1258, 1269 (App.
2009) (internal quotation marks and citation omitted).
Here, it appears the district court did not find
Takayama's complaint and amended complaint frivolous, inasmuch as
the district court did not find Takayama acted in bad faith in
filing his complaint/amended complaint. Rather, as noted above,
the lack of evidence of Takayama's knowledge of wrongdoing as
well as Takayama's error of judgment admissions seemed to have
persuaded the district court to characterize Takayama's actions,
including filing his complaint/amended complaint, as a mistake.
While the only evidence submitted to support the district court's
conclusion is Takayama's testimony, “the testimony of a single
witness, if found by the trier of fact to have been credible,
will suffice," 1noue v. 1noue, 118 HawaiT.86, 101, 185 P.3d 834,
849 (App. 2008) (citation omitted), and the trier of fact is free
to reject or accept any witness's testimony in whole or in part.
State v. Cannon, 56 Haw. 161, 166, 532 P.2d 391, 396 (1975).
5. Attorney's Fees
The district court did not abuse its discretion when it
awarded reasonable attorney's fees subject to the twenty-five
percent maximum allowed under HRS § 607-14. Sierra Club, 120
Hawai‘i at 19'7, 220 P.3d at 1242.
"Generally, under the American Rule, each party is
responsible for paying his or her own litigation expenses. An
exception exists to the American Rule in which attorneys' fees
may be awarded to the prevailing party where such an award is
provided for by statute, stipulation, or agreement." Ranger 1ns.
c@. v. Hinshaw, 103 Hawai‘i 26, 31, 79 93d 119, 124 <2003>
(internal quotation marks and citation omitted).
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Here, in dismissing Takayama's complaint/amended
complaint and granting count 11 of Zera's counterclaim, the
district court properly awarded Zera reasonable attorney's fees
pursuant to HRS § 607-14. Even if we were to assume Takayama's
complaint/amended complaint and count 11 of Zera's counterclaim
fell within provision H-2 of the rental agreement, HRS § 607-14
states, "[w]here the note or other contract in writing
provides for a reasonable attorney's fee, not more than twenty-
five per cent shall be a1lowed." As for Zera's claim that the
district court erred in calculating Zera's award of attorney's
fees as the prevailing party on Takayama's complaint/amended
complaint, Zera fails to note the portion of HRS § 607-14 that
states, "[t]he above fees provided for by this section shall be
assessed . . . upon the amount sued for if the defendant obtains
judgment[,]" which, apparently, is precisely how Zera's award was
calculated (sued for $2500, awarded $625 in fees).
C. Conc1usion
Accordingly, the March 24, 2006 final judgment of
District Court of the First Circuit, Honolulu Division is
affirmed. 2
DATED: Honolulu, Hawafi, March 18, 2010.
Michael Jay Green and
Glenn H. Uesugi, Chief Judge
for Plaintiff/Counterclaim-
Defendant/Appellant/Cross- `
Appellee. /;2
Associate Judge
Gary L. Hartman
for Defendant/Counterclaim-
Plaintiff/Appellee/Cross-
Appellant. éiz“¢z» `
Associate Ju e
On the briefs:
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