Case Title: A&B Properties, Inc. v. Dick Pacific Construction Co., Ltd.

Citation: 

Docket Number: 

State: hawaii

Court: Hawaii Supreme Court

Date: 2006-08-24T00:00:00Z

Document:
+*+NOT FOR PUBLICATION IN WEST HAWAI'I REPORTS AND PACIFIC REPORTER***
No. 27154

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DICK PACIFIC CONSTRUCTION CO., LTD., a Hawai'i corporation,
Respondent Appellant.

 

APPEAL FROM THE PIRST CIRCUIT COURT
(S.P. NO, 04-1-0302)

(By: Moon, C.J., Levinson, Nakayama; Acoba, and Duffy 23.)

In this construction contract case, respondent
appellant Dick Pacific Construction Co., Ltd. (Pacific) appeals
fron the first circuit court's August 2, 2004 order? granting
petitioner-appellee A&B Properties, Inc.’s (Ré8) Application to
Conpel Arbiteation. Pacific contends that the circuit court
ersed when St: (1) granted the Application to Conpel Arbitration
because AGB did not introduce any evidence to establish that AGS
held a valid assignnent of the construction contract or its
arbitration clause; (2) ruled that the right to compel
erbitration under the arbitration clause of the contract could be
assigned even though the contract prohibite assignment without
the consent of the other party: (3) failed to determine whether

AGB’s claim was barred by the statute of limitations and instead

 

 

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left that to the arbitrator’s determination; and (4) did not
dismiss the Application to Compel Arbitration on the grounds that
the claim sought to be arbitrated was barred under the applicable
statute of limitations as a matter of law.

Upon carefully reviewing the record and the briefs
submitted by the parties, and having given due consideration to

the arguments advocated and the issues raised, we hold as

follows:
(2) The circuit court did not err when it granted the
Application to Compel Arbitration. See Luke v. Gentry Realty,

105 Hawai'i 241, 246, 96 P.3d 261, 266 (2004) ("A petition to
compel arbitration is reviewed de novo, which is the same
standard applicable to a motion for summary judgment.” (Internal
quotations and citation omitted.)). A&B provided sufficient
evidence to establish a valid assignment of the contract and
Pacific failed to submit any evidence to the contrary. see
Exench v. Hawai‘i Pizza Hut, Inc., 105 Hawai'i 462, 470, 99 P.3¢
1046, 1054 (2004) (holding that after the party moving for
summary judgment satisfies its initial burden of production, the
non-moving party must “demonstrate specific facts, as opposed to
general allegations, that present a genuine issue worthy of
trial”) (citation omitted). Pacific's unverified claims of the
invalidity of the assignment agreement do not satisfy this

burden. See Au, Au, 63 Haw. 210, 213, 626 P.2d 173, 177 (1981)
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(Unverified statements of fact in counsel's memorandum or
representations made in oral argunent cannot be considered in
determining a motion for sunmary judgment.” (Citations
omitted.)). Therefore, AsB satisfied its burden of proof;

(2) The circuit court did not err in ruling that the
arbitration clause under the contract was assignable without
Pacific's consent because allowing AsB, instead of its
predecessor in interest, KY Planning Co., Ltd., formerly known as
Toses Shoji Co., Ltd., to arbitrate claims for damages against
Pacific will net prejudice Pacific, See, e.a., Elzinga & Volkere
vs LSSC Corp., 838 F.Supp. 1306, 1314 (D. Ind. 1993) (holding
that “the assignnent of a contract where the only right remaining
is to sue for damages will not prejudice [the signatory party) in
this case and should be enforced, notwithstanding the
nonassignment provision”); Prubowitch v. Riverbank Canning, 162
P.2d 182, 188, 30 Cal. 24 335, 344 (1947) (holding that “a
provision against assignment does not govern clains for money due
or claims for money damages for nonperformance,” and that the
assignee could therefore compel the signatory to arbitrate)
(citation omitted) ; Crown Oi) & Wax Company, Inc, v. Glen Constr.
Coss Ince, 578 A.2d 1184, 1193-95 (Md. 1990) (ruling that an
assignment was valid, notwithstanding a no-assignment clause, and

therefore the non-signatory could compel arbitration, because

 

there was no detriment to the signatory): and
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SSS

(3) The circuit court did not err when it reserved for
the arbitrator the issue of whether the claim sought to be
arbitrated was barred by the applicable statute of limitations.
See Lee v. Heftel, 81 Hawai'i 1, 4, 911 P.2d 721, 724 (1996)
(holding that “any doubts concerning the scope of arbitrable
issues should be resolved in favor of arbitration”) (citation
omitted). Given the breadth of the arbitration clause in section
7.9.1 of the contract, leaving the issue of Pacific's statute of
Limitations defense to the arbitrator to decide is consistent
with the Hawai'i and federal policy favoring arbitration.’ See
United Steelworkers of America v. Warrior and Gulf Navigation
Sou, 363 U.S. 574, 582-83 (1960) (holding that an order to
arbitrate should only be denied when “it may be said with
Positive assurance that the arbitration clause is not susceptible

of an interpretation that covers the

 

serted dispute”); Koolau

Radiology, Inc, v, Queen’s Medical Center, 73 Haw. 433, 444, 834

P.2d 1294, 1300 (1992) (stating that Hawaii's arbitration statute
contains language “virtually identical to the language of the
federal arbitration statute,” and therefore, this court “look(s}
to federal authority for guidance” when faced with a motion to

compel arbitration). Therefore,

Pacific's fourth point of error need not be addressed because the
issue of the statute of Limitations defense is for the arbitra

 

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IT IS HEREBY ORDERED that the circuit court's August 2,
2004 order is affirned.

 

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Honolulu, Hawai", August 24, 2006.
on the brief:

 

Erik D. Bike
for respondent-appellant

David Schulmeister
and W. Keoni Shultz
for petitioner-appellee