Title: Shanghai Investment Company, Inc. v. Alteka Co., Ltd.

State: hawaii

Issuer: Hawaii Supreme Court

Document:

‘NOT FOR PUBLICATION IN WEST'S HAWAN REPORTS AND PACIFIC REPORTER *
No. 26613

IN THE SUPREME COURT OF THE STATE OF HAWAT'I
OO

SHANGHAI INVESTMENT COMPANY, INC., a Hawai'i corporation,
Plaintiff-Appellee,

vs.

ALTEKA CO., LTD., @ Japan corporation, Defendant-Appellee.
(CIV. NO. 94-2683-07)

 

ALTEKA CO., LTD., a Japan corporation, Plaintiff-Appellee,

 

WINDWARD PARK, INC., @ Hawai'i corporation, THOMAS ENOMOTO,
Defendants-Appellees,

and

Defendants.

JOHN DOES 1-10, DOE PARTNERSHIPS 2-20, DOE CORPORATIONS) 1-20, ay
(CIV. NO. 95-3483-09)

 

RONALD G.S. AU, Petitioner-Appellant.

 

APPEAL FROM THE FIRST CIRCUIT COURT
(CIV. NOS. 94-2683-07 and 95~3483-09)

 

‘SUMMARY DISPOSITION ORDER
(By: Moon, C.J., Levinson, and Nakayama, JJ.,
Circuit Judge Hara in place of Acoba, J., recused
and Circuit Judge Blondin, in place of Duffy, J., recused)

Petitioner-Appellant pro se Ronald G.S. Av ("AU")
appeals from the June 1, 2004 order of the Circuit Court of the
First Circuit (“circuit court”)? denying his motion to enforce an
attorney's lien against his former client, Respondent-Appellee
Alteke Co., Lté. ("Alteka”). On appeal, Au raises seven points

of error, which are that the circuit court (1) erred in declining

‘The Hencrable Eden Elizabeth #ifo presides.
++ NOT FOR PUBLICATION IN WEST'S HAWAII REPORTS AND PACIFIC REPORTER

 

to enforce Au’s retainer agreement with Alteka, which contained a
contingency fee provision; (2) unjustly enriched Alteka by
including Au’s contingent fees within the judgment in favor of
Alteka, but denying Au’s motion to collect such fees; (3)
committed clear error to the extent that it found that Au did not
fully perform under his retainer agreement; (4) committed clear
error to the extent that it found that Au was either terminated
by Alteka or abandoned his representation in its case; (5) abused
its discretion by derogating Hawai'i law recognizing the validity

of attorney

 

liens; (6) erred by implicitly ruling that Alteka
was not judicially estopped from contesting Au’s attorney's lien;
and (7) abused its discretion by deciding Au’s motion without a
hearing or trial on the merits

Upon carefully reviewing the record and the briefs
submitted by the parties and having given due consideration to
the arguments advanced and the issues raised, we hold as follows:

(2) Au’s first point of error has merit. Following
this court’s ruling in Shanghai Inv. Co, v. Alteka Co., Ltd., 92
Hawai'i 482, 487, 993 P.24 516, 521 (2000) (*Alteka z*), Alteka,
through present counsel, filed a January 10, 2001 amendment to
its January 8, 2001 motion for attorneys’ fees and costs against
the adverse parties in that case, specifically seeking “an award
of a 108 contingency fee on recovery of proceeds and interest on
the promissory note between Alteka and [a non-party to the
instant appeal], pursuant to the Agreement for Legal Services
[(*retainer agreement*)] between Alteka . . . and [Au] dated
March 11, 1995,* attaching said agreement as the sole exhibit.
Of the various itens claimed by Alteka for attorneys’ fees, the
contingency fee provided by the Alteka/Au retainer agreement is
 

NOT FOR PUBLICATION IN WEST'S HAWAI REPORTS AND PACIFIC REPORTER.

 

the only iten based on a contingency fee arrangement. In its
March 19, 2001, order the circuit court ultimately awarded Alteka
attorneys’ fees, portions of which were attributable to
contingency fees. This order provided, inter alia, "8 of the
principal [amount of the promissory note] ($1,171.949.70) (sicl,
interest thereon, attorneys’ fees and costs actually collected of
received in connection of this action. . . [against the adverse
parties in Alteka I].*

‘The Alteka/au contingency fee was a component in the
two April 25, 2001 judgments (one against Shanghai Investment Co.
Inc. and the other, a Third Amended Judgment against Windward
Park, Inc. And Thomas Enomoto) in favor of Alteka, awarding it
attorneys’ fees and costs. No appeal has been taken from these
two judgments. The record on appeal indicates there has been
partial satisfaction of the Third Anended Judgment by way of an
execution on real property owned by Shanghai Investments Co. Inc.
‘There is no indication that these two judgments are other than
final judgments.

Although the contingency fee was awarded at 8¢ rather
than the 10% provided for in the Au-Alteka retainer agreement,
upon careful review of the record and in the absence of any other
explanation by the circuit court or Alteka, we are inexorably
Grawn to the conclusion that the contingency portion of the
circuit court's attorneys’ fee awarded in the aforenentioned
april 25, 2001 judgments were derived directly from the
contingency fee provision within the Au-Alteka retainer
agreement. In other words, the circuit court impliedly upheld
the validity and legal effect of the contingency fee provision in
 

 

NOT _FOR PUBLICATION IN WEST'S HAWAI REPORTS AND PACIFIC REPORTER *¥
the Au-Alteka retainer agreenent.?
‘The circuit court erred in denying Au’s request for a

Lien because Alteka’s opposition to the imposition of the lien

 

contradicted the basis on which it obtained the earlier judgments
awarding attorneys’ fees. Judicial estoppel applies here to
foreclose Alteka’s opposition to Au’s motion for a lien after it
successfully obtained a judgement from the circuit court based on
the same contingent fee sought by Au.

Alteka correctly observes that Au did not raise the
issue of judicial estoppel in the adjudication of the non-hearing
motion for the charging lien. This court has, however, noted
that it has the discretion to invoke, aua sponte, the construct
of Judicial estoppel upon a clear showing that inconsistencies
and unfairness would resvit. Kahala Roval Corp, v, Goodsill,
Anderson Quinn é Stifel, 113 Hawai'i 251, 272 n. 21, 181 P.3d
732, 783 n. 21 (2007). Here Alteka’s position in claiming the
Alteka/Au contingency fee as a component of its award for
attorneys’ fees against Windward and Enomoto in the Third Amended

 

Judgnent is clearly inconsistent with Alteka’s position in
claiming that Au is not entitled to the contingency fee and a
charging lien based thereon. It is obvious that an unfairness
would result if Alteka is allowed to recover sums based on an
avard of the contingency fee and then be allowed to avoid
Liability on that same fee.

(2) Because this single point of error has merit and
is determinative of the entire appeal, we need not address Au’s

remaining points of error.

 

+ the validity cf the auard of attorneys’ fees, including that
porticn theres! attrizotable to the Alteks-Av contingency fee, ie not at Seve

 

 
 

+= NOT_FOR PUBLICATION IN WEST'S HAWAII REPORTS AND PACIFIC REPORTER ***

‘THEREFORE,

IT IS HEREBY ORDERED that the June 1, 2004 order of the
circuit court is vacated. This case is renanded to the circuit
court with instructions to (1) enter a attorney's lien in favor
of Au as to the contingency fee portions of the April 25, 2002
circuit court judgments, and (2) conduct further proceedings to
determine which portions of the amounts remitted to Alteka in
satisfaction of the circuit court's April 25, 2001 attorneys’
fees and costs judgments, if any, include contingency fees to be
remitted to Au.?

DATED: Honolulu, Hawai'i, October 16, 2007.

on the briefs: Sprbn—
Ronald 6.8. A%, coh
Petitioner-Appellent oro 28

basi Atston, Davis A, Neate chr .
Nakashima and Laura P. Couch te fae

of Alston Hunt Floyd & Ing for
Respondent-Appellee Deo
Alteka Co., Ltd.

 

> inasmuch e# the contin:

agreenent were te be pesd to" "the
Televant constituents ef which (ether than Av) are uF
inser alia, whether any other parties may have 3 valid Lien.