NOT FOR PUBLICATION IN WEST'S HAWAII REPORTS OR THE PACIFIC REPORTER

NOS. CAAP-19-0000437 & CAAP-19-0000658

IN THE INTERMEDIATE COURT OF APPEALS

OF THE STATE OF HAWAI#I

MTGLQ INVESTORS, L.P., Plaintiff-Appellee, v.

WILLIAM HALEMANO FREDERICK, Defendant-Appellant,

and

UNITED GUARANTY RESIDENTIAL INSURANCE COMPANY

OF NORTH CAROLINA; FEDERAL HOME LOAN MORTGAGE

CORPORATION, Defendants-Appellees,

and

DOES 1 through 20, Inclusive, Defendants

APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT

(CIVIL NO. 17-1-1439-09 (JHC))

ORDER

(By: Wadsworth and McCullen, JJ., and

Hiraoka, Presiding Judge, concurring in part separately)

Upon consideration of the February 6, 2023 Notice of

Defendant-Appellant William Halemano Frederick's [(Frederick)]

Chapter 7 Bankruptcy Case (Notice of Bankruptcy Case), filed by

Plaintiff-Appellee MTGLQ Investors, L.P. (MTGLQ), the papers in

support, and the record, it appears that:

(1) On January 25, 2023, this court entered a Summary

Disposition Order (SDO) in this appeal;

(2) On February 6, 2023, MTGLQ filed the Notice of

Bankruptcy Case, which notified this court (for the first time)

that Frederick filed a Chapter 7 bankruptcy petition on

October 13, 2022.

(3) The filing of a bankruptcy petition stays the

"commencement or continuation . . . of a judicial . . .

Electronically Filed

Intermediate Court of Appeals

CAAP-19-0000437

16-FEB-2023

08:10 AM

Dkt. 54 ORD
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proceeding against the [bankruptcy] debtor" during the pendency

of the bankruptcy case." 11 U.S.C. § 362(a)(1). It also

operates as an automatic stay of "any act to obtain possession of

property of the estate or of property from the estate or to

exercise control over property of the estate[.]" 11 U.S.C.

§ 362(a)(3). The filing of the petition triggers the automatic

stay, notwithstanding the lack of actual notice of commencement

of proceedings. In re Sumpter, 171 B.R. 835, 841-42 (Bankr. N.D.

Ill. 1994).

(4) The court did not receive notice of Frederick's

bankruptcy until after it entered the SDO in this appeal.

Nevertheless, the SDO is void. See Island Ins. Co. v.

Santos, 86 Hawai#i 363, 366, 949 P.2d 203, 206 (App. 1997)

(holding that actions taken in violation of the automatic stay

are void and without effect, even if the entity that violated the

stay had no knowledge or notice of the filing of the bankruptcy

petition or of the automatic stay, although the bankruptcy court

could retroactively annul the stay and validate actions that

violated the stay); Wagner v. World Botanical Gardens, Inc., 126

Hawai#i 190, 195, 268 P.3d 443, 448 (App. 2011) ("A judgment is

void only if the court that rendered it lacked jurisdiction of

the subject matter, or of the parties, or if it acted in a manner

inconsistent with due process of law." (quoting In re Genesys

Data Techs, Inc., 95 Hawai#i 33, 38, 18 Pl3d 895, 900 (2001))).

(5) Hawai#i Rules of Appellate Procedure (HRAP) Rule

54(b) states in part: "If any party has knowledge of a

bankruptcy action that stays an appeal, including when a party

files for bankruptcy while an appeal is pending, the party with

knowledge shall immediately file a notice of bankruptcy with the

appellate court." (Emphasis added.) The parties appearing in

this appeal did not fully comply with HRAP 54(b). Frederick

filed no notice of bankruptcy in this court. MTGLQ did not file

the Notice of Bankruptcy Case in this appeal until February 6,

2023, over three months after the Chapter 7 bankruptcy petition

was filed and twelve days after entry of the SDO. The parties

are strongly cautioned that any future failure to fully comply

with HRAP 54(b) may result in sanctions. 

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Therefore, IT IS HEREBY ORDERED that the January 25,

2023 Summary Disposition Order is rescinded.

DATED: Honolulu, Hawai#i, February 16, 2023.

/s/ Clyde J. Wadsworth

Associate Judge

/s/ Sonja M.P. McCullen

Associate Judge

HIRAOKA, J., CONCURRING IN PART

I concur that our January 25, 2023 Summary Disposition

Order must be rescinded because it violates the automatic

bankruptcy stay even though we had no actual notice that

Frederick had filed a bankruptcy petition on October 13, 2022.

I write separately because judicial resources that

could have been allocated to disposing of other pending appeals

were wasted because of MTGLQ's failure to immediately file a

notice of Frederick's bankruptcy. Instead of a strong caution, I

would issue an order to show cause why MTGLQ should not be

sanctioned for violating Hawai#i Rules of Appellate Procedure

Rule 54(b).1/

/s/ Keith K. Hiraoka

Presiding Judge

1/ The automatic bankruptcy stay would preclude issuance of a similar

order to show cause to Frederick.

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