good morning may please the court i'm jim bickerton counsel for the appellants this case presents a situation where a trial judge dismissed the case and a rule twelve these six didn't do the most basic thing that we expect district court judges to do in a diversity action which is to apply the case law of the state if that case law is missing then decide how the hawaii supreme court would rule on the issue was she certified the question did she not to the why supreme court and related litigation no she certainly did not certified your honor it is before the hawaii supreme court we happened to have another case the same team of attorneys pending in state court that was not removed that case will work its way up to the intermediate court of appeals and then last year the hawaii supreme court accepted a transfer application made by the parties it was actually made i think by both sides urging and it's interesting that mr rosen joined in that he wanted the white supreme court to take it one of the criteria for the why supreme court to take the case is that it has to present a novel question or a question of public importance so in that sense some of these issues have not previously been decided by judge mol way took it upon herself to decide them and didn't follow the basic law of the reverse is talking well i guess the question that we posed to you by way of the order when we asked you to comment on that was a practical question of should we wait until the why supreme court hopefully resolve some of these issues that will be able to give guidance if necessary to the district court if we do decide  you please forgive me but i had not seen an order this may have come down this in the last few days and i have been moving around quite a bit the last couple days so we're not aware of any order either count ok i it is something that i was going to suggest t basically the way i look at it is that judge mall way if i could expand a little bit on that point and put it in context judge moore way the district judge was facing two claims of common law claim and a chapter four eighty claim what we call the and she first of all in the common law claim did not want to follow the whole why supreme court cases on the common law of non judicial foreclosure and then on the huge happened alice's she said well because there's no i don't see a violation statute or case law there can't be a huge gap you folks have already spoken to the second question in the content case so right there she's i think in error on that question that you that case the question of the common law issue the continued vitality of all regions silva we think that is going to be addressed by the why supreme court very shortly so then the question is should you be trying to sustain her decision on alternative grounds because she clearly erred in not following the compton doctor the same judge who was reversed in compton for doing basically the same thing going outside the you'd up statute looking for alternative sources of  equal age silver was eight hundred eighty four the statute is eight hundred seventy four and it's really although judge molly said it was substantially amended in two thousand and eight i mean we've presented the legislative history there was virtually no amendment of the substantive portions that we're all concerned about here those provisions remained almost identical what changed in two thousand and eight was increased the transparency by requiring an attorney to be the business agent who conducted the sale but essentially beyond that there were really no substantive amendments that pertain to the issues in this case so sylvan all rich were interpreted in the very language that judge moore we had before her and she made it i think of a gross error in saying that because the legislature didn't choose to express lee bring those cases into the statute in two thousand and eight when it tankard with the statute that somehow they've been legislatively overruled counsel i counter that your primary point is that you do happen really controls or whatever the remedies available under common law and i know you're not saying they don't exist but even if they didn't exist i gather from your pleadings that you say that you do use a broad remedial statute and that what occurred here is a violation of that statute we do say that even in the absence of calm there is common law common law is just one of the ways in which courts can derive the finding that a public policy exists for consumers you look and see what this business is conduct violating and establish public policy and the case law says public policy can be established through common law but it can also come from other sources and we rely for example on the eight hundred ninety legislatures preamble to the statute where they said this is what we're trying to have you do in the let me ask you this council as you know when somebody sikhs are really the surgery with the u s supreme court the supreme court lays out what the questions are that it will address if at all in mandatory transfer failed and certain types of cases i don't believe that this was the automatic type this is ok and they bypassed the intermediate court at the request of both parties right right and did the supreme court indicate that it was going to address specific questions or it simply said we're going to take this case whatever is there to the case in a sense is the court of the first appeal and in hawaii the way it works if the supreme court takes it advertising of a quit claim deed and the argument that that is a way of discouraging bitters that option the trial court in that case found that stated a claim she did not dismiss that and she only she therefore certified  on the streets one of these cases of overlap as i recall the the quitclaim deed was not pursued in this case is that correct i know it was in others but in this was in bold we have the two issues ok both issues in that the three cases that you have before you call the mcgee bone bald were all pretty much the same there are slight factual differences for example the form of the mortgage in the bald case the key paragraph is paragraph twenty one twenty two but it's the same language but other than that they are they both present the the argument about the quick claim and then the argument about the postponement mascot earlier earlier my colleague a judge tolman asked you whether you thought we ought to wait for the result and hun gate i got the impression you said that's right but you didn't specifically say so is that a correct answer and i think that it is too well and it is coming so soon i hesitate to ask you to do that because these cases are already very old judge watson who is the other district court judge who has three of these before him was not sufficiently persuaded by judge i'm always reading dismiss the case the cases before him he chose to stay them pending your decision and i ask you then under hawaiian l assume for a moment are you want to know that the whole life for important side and get your way are we decide it your way what happens with the properties that have been sold under the regime against which you complain some of them go back many years now this point we have not alleged in these cases claim to set aside rescind or avoid any sale of the defendants are the banks and lawyers who conducted the foreclosure was all for money and per future that's what the cases are so what's the harm in waiting until the supreme court decides the i think that there is no harm what i'm what i'm concerned about is one day will not completely address one of the issues which is the quitclaim issue because that issue isn't raised there however i do believe that the general principles about the interaction between the non judicial statute and the statute will be elucidated in hundred eight and will guide the decision of the court on the quitclaim deed the the concern i had which prompted my question to you was a practical one if we decide the issue differently than the way why supreme court decides it our ruling will be binding on these cases and perhaps on federal district courts in the future but this is and the issue of state law over which the state supreme court is the final expire and i hesitate to make a ruling on an issue when i know that the final exposure is about ready to have its final say i i agree with that sentiment what i was if you're if you're going to not immediately reverse her but she could follow the hunt get decision it's going to come down and it's going to educate her and she in the first instance can hear it on perhaps a better record than you have now i mean this is a twelve six record i'm not familiar with with her why state of our practice but is there any kind of a average amount of time or a time i know they argue this case is we actually made a study of that because we thought this question might come up and  about six months on average five to six months and we argue this on june seventh so we're looking at sometime in november december if they keep to their average there is no rule requiring them but it is it's imminent is how we look at it and i think they're well that of the pile of cases it is standing behind this one there's about seventeen altogether in various courts six or seven in this in the federal court in an equal number in the state court that's let me ask you this  i'm from california california when there is a foreclosure sale there's almost always title insurance involved really doesn't matter whether the grant deed or quit claim  some specialized deed because the parties are insured by title insurance is that not the practice in hawaii title insurance does not automatically as i understand it get acquired if there's a quit claim deed the title companies like to see a warranty deed from of i'm sure they do but i mean the reality is time companies will insure anything because they usually don't have to pay anything or a price of course of course but the reality is that it is i t not the practice and a foreclosure sale in hawaii be it under judicial or private sale for the intended purchasing party to make arrangements with the title company to ensure title yes it is and i believe that to answer judge thomas question the it would be safe to say that all of these people who had acquired these subsequently from the bank either  o sales or at auctions directly with at this point have title insurance so how are they how could they be harmed by not giving it quit claim deed if the title insurance company steps in and you're in t's their title the the person who is acquiring it doesn't know if they will get title when there is going to be a dis and a good example is this very case in ball mr rose and only did it twenty eight day notice now that's not a claim alleged here but the point is a bitter coming in would see that and not want to bid on this property well maybe it would it would be it would but the title insurance company would know that as well and if they agreed with you they may ask for some kind of a premium or something  some plus factor if you will think that they'll insure rights but that plus factor is is a different bitters when there's another one down the street at the judicial auction that is has the stamp of a judge on it so that's one of the ways in which bidding is deterred when it went to when i judicial foreclosure takes place in hawaii not what we have here but a judicial foreclosure does the statute provide what kind of deed the foreclosing official has to give there's a commissioner's deed but by operation of law a judge has made a final order eradicating all old all inferior liens and other potential ways of contesting and race judicata blocks the mortgage or from coming in and challenging that's the big difference redemption after a judicial foreclosure and why there is an opportunity not that familiar with the judicial i'm not an expert in judicial foreclosure there there is right up until all of the hammer a chance or  in judicial foreclosures to get the property back and normally it's a one year period after the hammer falls where they can redeem the property of their pay is that true and why don't we do not have that have that it's up to the fall of the hammer if i may reserve my last twenty or thirty seconds you may do how she may proceed they please the court my name is clyde wadsworth and together with blaine rogers i represent the defendant happily wells fargo bank and a given the overlap of the issues raised opportunity to submit supplemental briefing and if this court would deem it helpful to make further oral argument it's important to remember though that even if this court defers disposition and gate won't decide hunt gate won't resolve whether the mortgagee in a non judicial for closure has a duty to convey the property with warranties that's not an issue and gave i think we all agree on that that's a quick claim argument as t in federal court than in state court under the it ball twamley standard conclusions aren't enough their complaint has to contain sufficient that's the state a claim that's plausible on its face no here plaintiff leaderless didn't plead that the alleged failure to publish notice of her postpone for closure caused her any harm whatsoever and plaintive bald made only conclus conclusory allegations that the amount his property sold for at auction wasn't enough to cover his debt but i thought the theory was that if if no one but the offer or knows that the sale has been postponed then how can any putative bidder know when and where to appear if they might be interested in submitting a well there theory your honor is that the announced to the prospective purchasers who were there so that's how they know and that is what complies with the statute and what complies with the mortgage and i thought the allegation here was that the postponements war neither published nor was ever in the notice ever given to the borrowers so how do we know that somebody stood on and all the steps of the courthouse or wherever the sale was to take place  and said in a loud voice to whoever might be present we're postponing this auction for thirty days your honor they do not allege that the that the postponement was not publicly announced that is not how could they allege that if there was nobody there it seems to me that it's very difficult to expect the plaintiff to be able to establish that fact well that would have to be the allegation your honor to to establish under the under the prevailing under the governing statute that proper notice wasn't given because the statute only requires that there be a public announcement and what would you concede that if mr rosen had sat in his office and done nothing the date came and went and then the auction didn't occur until later that that would be a violation of the statute yes if there was no public announcement that would be  counterpart to the f c c f t c act it's remedial in nature it's supposed to be liberally construed and i got to tell you honestly that reading these cases common law court and your local bankruptcy court of construed this you depth and it is a really low bar kind of thing i mean you don't have to prove very much to at least a legit cause of action whether you can prove it's another matter and it seems that everything is based upon the facts of the individual claim so let's take the claim  believe for mr ball what the record shows although this is not alleged in the complaint with the record shows is that there was one postponement and then let's well let me move to a hypothetical that will help me understand better what your position is let's say hypothetically let's start with the hundred gates situation so you've got four postponements let's say that there were twenty with that be a violation of you that we have got fair it would depend on the circumstances your honor we we agree that there is a you know there are some there are several duties that the the mortgagee has the duty has or excuse me the more he has a duty to comply with the non judicial foreclosure statute has a duty to comply with the terms of the believe that in compton the court is it fair to say the putting aside for a moment the pleased that it sounds to me like you are at least in the hypothetical a green these cases have to be cited on a fact case by case basis is that a fair statement of ours if you had that might twenty postponement illustration you could see that maybe with those standards that you talked about it might not be fair and maybe in that case there would be a claim if there were respect to the quick claim issue and maybe others i'm sorry what was your question your honor why are there not sufficient allegations in this complaint to raise a question of fact well because we we believe that in order for the for the for the plaintiffs to show unfairness under white you law he has to show an established public policy that  more than a quit claim deed was required and under hawaii law there is no established public policy that requires a quit claim deed anything more than a quit claim deed and there and there are there are good reasons for that as are relying on it was dealing with the sale of of livestock not the principle as i understand it is that there is a duty whether it's for a duty or who are you describe it to maximize the benefit for the mortgage or and the allegation in this case is that duty was to fault it  and i'm just still not quite sure why that shouldn't be a matter of of evidence and a question of fact well there's no it's our contention is it's a legal issue as to whether requiring which is deed was provided for closure the issue of whether that's sufficient or whether that's unfair we believe in this context it is a legal question because it's because there is no requirement in hawaii common law that or by statute that requires conduct a women don't go away from me ok does is you dep itself a form of if you will a declaration of public policy about how the legislature wants its citizens to be treated certain types of transactions in a general sense yes yeah that's what most public policies are and they're not they're pretty general yes it's a general consumer protection statue ok when it's supposed to be liberally construed what you've got is this neustadter tory overlay that somewhat parrots the f t c act it's very general it wants the citizens to be treated fairly and at least based upon our comp in case we find it does it doesn't have to deceptive acts in its relationship with the borrower in the the court in compton ruled that the plan to borrow had had adequately pleaded a deceptive deceptive that by alleging that the defendant the lender made misrepresentations that misled her into believing that it would modify her alone and not her clothes while the loan was still in for closure in contrast here the plaintiffs didn't the legit the mortgagee made misrepresentations to the plaintiffs and they can't because because a quick claim was advertised  provided in the notice of sale the notice of sale stated that the foreclosures could be postponed from from time to time with public announcement and the district court here did not dismiss plaintiffs you doubt claim based on an absence of a policy violation based on any other statutory or common law source that the plaintiffs identified they tried lopez but the court rejected counsel reasoned with respect i just said are compton case that you don't have to rely upon a preexisting duty under common law or statutory law so if my understanding of compton is correct all they have to do is to plead that there was a violation and that's really simple it's what i think of two prongs to it if i recall correctly and one of them is not what you talked about in compton your honor there was a deceptive act that was that was pleaded right and  have no i sure it's true or not that i think the allegation is like sixty one percent of the private sales handled by mr rosen are postponed versus a tiny fraction of the less than ten percent on average the rest of us are going to have no idea whether any of that's true but if you add those two together could that not as a matter of pleading constitute an quote unfair act under you if there were multiple postponements and and other allegations like the ones i just mention the remaining balance part to which they chose not to follow does give the consumer that protection it doesn't apply here the right they chose not to take part two you only consider part two because it gives you the whole statutory scheme and defeats their safe harbor argument  they wanted a non judicial method in the two thousand when we had this great wave of foreclosures the banks decided to take a chance on using part one but prior to that they had it had been more about no one had been using it for many years is it correcting in the whole why that you don't can just sue on the nut collect whatever you can and then all the monthly go after the leave the land of the trust we don't have that rule we have general more general call all rules about combining your causes of action or so that we don't have the california rule  if i could just make two quick points that i wanted to make in response i neglected to mention that there is another case pending that was argued a month after hundred gate and the why supreme court called much for yoshi and in a way it's a companion case it is not a case that we fall originally but i appeared in it and argued the appeal what's the status of the case virtually the same is just a month behind one day but in the supreme court of in this what why supreme court what's relevant about that case here is they tried to suggest to you that while they were quick claim deeds that were given here well they were given to the bank in both does that burden issue still swing that way should we are you suggesting we should wait for that decision as well i really hate to make us all wait any longer but yes i think the two cases are going to be they're intertwined the court is going to consider them at the same