NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

NO. CAAP-16-0000891

IN THE INTERMEDIATE COURT OF APPEALS

OF THE STATE OF HAWAI#I

ML, Plaintiff-Appellant, 

v.

HL, Defendant-Appellee 

APPEAL FROM THE FAMILY COURT OF THE FIRST CIRCUIT

(FC-D. NO. 11-1-0899)

SUMMARY DISPOSITION ORDER

(By: Ginoza, Chief Judge, Hiraoka and Wadsworth, JJ.)

Plaintiff-Appellant ML (Husband) appeals from the

"Decision and Order After Remand" entered by the Family Court of

the First Circuit1 on December 1, 2016. For the reasons

explained below, we affirm the Decision and Order After Remand in

part; vacate the Decision and Order After Remand in part; and

remand this case to the family court for clarification of the

reimbursement or payment obligations of the parties, and for

entry of an amended property division chart.

BACKGROUND

Husband filed for a divorce from Defendant-Appellee HL

(Wife) on May 27, 2011. After a trial, a "Decision and Order"

was entered on January 7, 2014. Attached to the Decision and

Order was a property division chart dated January 3, 2014 (2014

Property Division Chart). An "Amended Decision and Order" was

entered on January 10, 2014. The 2014 Property Division Chart

1 The Honorable Catherine H. Remigio presided.

Electronically Filed

Intermediate Court of Appeals

CAAP-16-0000891

26-JAN-2021

08:02 AM

Dkt. 60 SO
NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

was attached to the Amended Decision and Order. A divorce decree

was entered on March 4, 2014. The decree required that Husband

pay to Wife an equalization payment of $128,987.87.

Husband appealed. The family court entered findings of

fact and conclusions of law on August 12, 2014 (2014 Findings &

Conclusions). The 2014 Property Division Chart was attached to

the 2014 Findings & Conclusions. We temporarily remanded the

case to allow the family court to amend the divorce decree. On

September 15, 2015, the family court entered an order amending

the divorce decree, and amended the findings of fact and conclusions of law relating to Husband's child support obligation.

The case then returned to us and we issued a summary

disposition order, MHL v. HJKL, No. CAAP-14-0000697, 2016 WL

806200 (App. Mar. 1, 2016) (SDO) (First SDO). We noted:

[Husband] contends that the family court abused its

discretion by declining to award [him] a Category 3 credit

for a portion of his Schwab One account. [Husband] contends

that he deposited a $136,254 gift or inheritance received

from [his mother]'s revocable trust after [his mother]'s

death in 2008 into the investment account.

Id. at *5. We also noted:

This is generally in line with [Husband's father]'s

testimony that he believed [Husband] had received around

$90,000 from [Husband's mother]'s trust, which was deposited

in [Husband]'s account.

Id. The family court did not award Husband any Category 3 credit

for his inheritance from his mother's trust. We concluded that

the family court erred in denying [Husband] any Category 3

credit. While the family court was entitled to exercise its

discretion in the valuation of the Category 3 claim, it

should not have awarded [Husband] no credit. On remand, we

direct the family court to use the available evidence to

determine a reasonable value for [Husband]'s Category 3

claim.

Id. at *6 (first underscore in original, second underscore

added). We otherwise affirmed the divorce decree and the order

amending it.

2
NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

On remand the family court issued an order stating, in

relevant part:

Counsel shall submit memorandum [sic] supporting each

party's position regarding a reasonable value for

[Husband]'s Category 3 claim. Exhibits shall be limited to

evidence available at trial.

Husband submitted a trial exhibit showing the balance of his

mother's investment account to have been around $250,000 when she

died. Husband and his sister were the account beneficiaries;

accordingly, he claimed half of the balance, or $125,000. 

Alternatively, he argued, because we had recognized there had

been a $200,000 withdrawal from his mother's account after the

date of her death, "at a minimum [he] should receive a credit of

$100,000[,] which is also consistent to [sic] [his father]'s

testimony that [he] had received around $90,000" after his

mother's death. Husband did not submit evidence showing any

actual deposit into his Schwab One account.

Wife also submitted a memorandum and exhibits. She

pointed out there were no trial exhibits showing when Husband's

inheritance was deposited into his Schwab One account, or what

the value was at that time. The only evidence was Husband's

father's testimony that about $90,000 was deposited into

Husband's Schwab One account after Husband's mother died. Wife

then argued there should be a $90,000 deviation based upon the

Hawaii Revised Statutes (HRS) § 580-47(a) equitable

considerations.

The Decision and Order After Remand was entered on

December 1, 2016. The family court found that the amount of

Husband's inheritance was $90,000; recognized equitable considerations justifying a departure from the marital partnership

model; and ordered a deviation of $70,000 in favor of Wife.

Husband filed this appeal. The family court entered

findings of fact and conclusions of law on January 31, 2017 (2017

Findings & Conclusions). The family court ordered that Wife

reimburse Husband $20,000 of the "$129,987.87 [sic]" equalization

amount at the rate of no less than $5,000 per calendar year or,

if Husband had not yet paid the equalization amount, the amount

3
NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

was adjusted to "$109,987.87 [sic]." The family court did not

amend the 2014 Property Division Chart or attach an amended

property division chart to the 2017 Findings & Conclusions.

DISCUSSION

Husband's statement of the points of error does not

comply with Rule 28(b)(4) of the Hawai#i Rules of Appellate

Procedure. Husband appears to argue that: (1) the family court

disregarded our mandate by applying equitable considerations to

reduce the amount of Husband's Category 3 credit or, even if

equitable considerations were properly recognized, none of them

justified deviation from the marital partnership model of

property division; (2) the family court erred by granting Wife

four years to repay Husband's excess equalization payment; and

(3) Wife's request for attorneys' fees should have been denied

because it was contrary to the family court's previous ruling

that each party pay their own fees.

1. The family court did not err by

recognizing equitable considerations.

Husband contends that the family court "exceeded the

scope of [the] narrow remand — to determine a reasonable value

for [Husband]'s Category 3 claim — when it deviated from partnership principles based on equitable considerations never addressed

in the original divorce proceedings or listed in the 2014 Findings." "Equitable considerations" justifying a deviation from

marital partnership principles are also referred to as "valid and

relevant considerations" and "valid and relevant circumstances,"

or "VARCs," by Hawai#i courts. Gordon v. Gordon, 135 Hawai#i 340,

349 n.15, 350 P.3d 1008, 1017 n.15 (2015).

The First SDO recognized that "the family court was

entitled to exercise its discretion in the valuation of the

Category 3 claim," but "it should not have awarded [Husband] no

credit." First SDO, at *6. Our mandate to the family court was

"to use the available evidence to determine a reasonable value

for [Husband]'s Category 3 claim" for the inheritance from his

mother. Id. Category 3 net market values "are to be repaid to

4
NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

the contributing spouse absent equitable considerations justifying a deviation." Gordon, 135 Hawai#i at 349, 350 P.3d at 1017

(underscoring added) (footnote and citations omitted). To divide

Category 3 property the family court must: (1) find the facts

necessary for assignment of the relevant net market value (NMV);

(2) identify any equitable considerations justifying deviation

from total repayment to the contributing spouse; (3) decide

whether or not there will be a deviation; and (4) decide the

extent of any deviation. See id. at 350, 350 P.3d at 1018. To

comply with our mandate the family court was required, after

determining the NMV of Husband's inheritance from his mother, to

identify any equitable considerations justifying a deviation from

the marital partnership principle of crediting Husband with all

of his inheritance, decide whether or not there will be a

deviation and, if so, decide the amount of any deviation.

Husband contends that Wife waived all equitable

considerations because she did not raise them before the family

court, or with us during Husband's first appeal. We disagree. 

The family court considered Husband's interest in his father's

irrevocable trust "as a valid and relevant consideration in

deviating from the Partnership Model[,]" First SDO, at *5 n.7,

and noted the VARC in Part E of the 2014 Property Division Chart. 

There was no reason for the family court to consider any

equitable considerations related to Husband's inheritance from

his mother before the last remand because the family court did

not award Husband "any Category 3 credit" for the inheritance. 

First SDO, at *5-6.

Husband also contends that Wife is barred from raising

equitable considerations by the doctrine of res judicata. Res

judicata, or claim preclusion, is a legal doctrine that limits a

party to one opportunity to litigate a claim to prevent inconsistent results among multiple suits, and to promote finality and

judicial economy. Bremer v. Weeks, 104 Hawai#i 43, 53, 85 P.3d

150, 160 (2004). Claim preclusion "prohibits a party from

relitigating a previously adjudicated cause of action." Id.

(citation omitted). The party asserting claim preclusion has the

burden of establishing that (1) there was a final judgment on the

5
NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

merits, (2) the parties to the action in question are the same or

in privity with the parties in the original suit, and (3) the

claim decided in the original suit is identical with the one

presented in the action in question. Id. at 54, 85 P.3d at 161. 

Claim preclusion does not apply here because there was no final

judgment on the merits in a previous suit between Husband and

Wife.

2. The family court did not abuse its 

discretion by ordering payment over time.

Husband contends the family court erred by granting

Wife four years to repay Husband's excess equalization payment.

[T]he family court possesses wide discretion in making its

decisions and those decision[s] will not be set aside unless

there is a manifest abuse of discretion. Thus, we will not

disturb the family court's decisions on appeal unless the

family court disregarded rules or principles of law or

practice to the substantial detriment of a party litigant

and its decision clearly exceeded the bounds of reason.

Fisher v. Fisher, 111 Hawai#i 41, 46, 137 P.3d 355, 360 (2006)

(citation omitted). On the record before us, and subject to

section 4. of this summary disposition order, we cannot say that

the family court erred by ordering Wife to repay Husband's excess

equalization payment over time.

3. The family court did not 

award attorneys' fees to Wife.

Husband argues that the family court should have denied

Wife's request for attorneys' fees because it was contrary to the

family court's previous ruling that each party pay their own

fees. The Decision and Order After Remand made no mention of

attorneys' fees. The 2017 Findings & Conclusions — entered after

Husband filed his notice of appeal — states:

30. Upon the conclusion of this appeal, Wife intends

to request an award of attorney's [sic] fees as "just and

equitable" under the criteria of HRS § 580-47, namely: the

respective merits of the parties, the relative abilities of

the parties, the condition in which each party will be left

by the divorce, the burdens imposed upon either party for

the benefit of the children of the parties, the concealment

of or failure to disclose income or an asset, and all other

circumstances of the case.

6
NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

The family court did not award attorneys' fees to Wife. There is

no basis for Husband's appeal on that point.

4. The family court erred when it 

calculated Husband's equalization 

credit and/or Wife's reimbursement amount.

The family court must file, as part of its findings and

conclusions, a property division chart. Gordon, 135 Hawai#i at

351, 350 P.3d at 1019. The Decision and Order After Remand

amended the division of marital partnership property, but the

family court did not amend the 2014 Property Division Chart or

attach an amended property division chart to its 2017 Findings &

Conclusions.

It also appears that the family court erred when it

calculated the amount of Husband's Category 3 VARC credit, the

amount of Wife's reimbursement obligation, or both. The Decision

and Order After Remand stated, among other things:

2. The amount of [Husband]'s Category 3 inheritance

credit is $90,000.00.[sic]

. . . .

7. [T]he Court finds that there will be a deviation in

the amount of $70,000.00 in favor of [Wife].

8. In the event that [Husband] has already paid [Wife]

the previously-ordered equalization amount of

$129,987.87, [sic] [Wife] shall reimburse [Husband]

$20,000.00 at the rate of no less than $5,000.00 total

per calendar year (January 1 through December 31),

beginning January 1, 2017.

(Underscoring in original.) The 2017 Findings & Conclusions

stated, among other things:

44. Based on the totality of the relevant and

credible evidence that was provided at trial, the Court

finds that there will be a deviation in the amount of

$70,000 in favor of Wife.

45. In the event that Husband has already paid Wife

the previously-ordered equalization amount of $129,987.87,

then Wife shall reimburse Husband $20,000.00 at the rate of

no less than $5,000.00 total per calendar year (January 1

through December 31), beginning January 1, 2017. . . .

45(a). In the event that Husband has not paid Wife the

previously-ordered equalization amount of $129,987.87, said

amount is herein adjusted to $109,987.87.

7
NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

The 2014 Property Division Chart shows the equalization

payment amount (Part B, line 4) as $128,987.87, not $129,987.87. 

Accordingly, we vacate those portions of the Decision and Order

After Remand and the 2017 Findings & Conclusions that reflect an

incorrect equalization payment amount; and remand this case to

the family court for clarification of the payment or reimbursement obligations of the parties, and for entry of an amended

property division chart.

DATED: Honolulu, Hawai#i, January 26, 2021.

On the briefs:

/s/ Lisa M. Ginoza

Peter Van Name Esser, Chief Judge

for Plaintiff-Appellant.

/s/ Keith K. Hiraoka

Thomas E. Crowley, III, Associate Judge

for Defendant-Appellee.

/s/ Clyde J. Wadsworth

Associate Judge

8