Source: https://case-law.vlex.com/vid/430-p-3d-892-770578005
Timestamp: 2019-04-18 22:16:22+00:00

Document:
Attorney: Steven K.S. Chung, Michael L. Iosua, Li Li, (Imanaka Asato, LLLC), Honolulu, for Plaintiffs-Appellants. David R. Major, James G. Diehl, (Bays Lung Rose & Holma), Honolulu, for Defendant-Appellee.
APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT (CIVIL NO. 16-1-2256).
Steven K.S. Chung, Michael L. Iosua, Li Li, (Imanaka Asato, LLLC), Honolulu, for Plaintiffs-Appellants.
David R. Major, James G. Diehl, (Bays Lung Rose & Holma), Honolulu, for Defendant-Appellee.
Plaintiffs-Appellants, Gilbert and Daisy Malabe (the Malabes) appeal from the Final Judgment (Judgment) entered by the Circuit Court of the First Circuit (Circuit Court),1 on February 17, 2017, in favor of Defendant-Appellee the Association of Apartment Owners of Executive Centre (the AOAO). The Malabes also challenge the Circuit Courts Order Granting Defendant AOAOs Motion to Dismiss Complaint, filed December 13, 2016 (Order Granting the AOAOs Motion).
On appeal, the Malabes assert eight points of error,2 contending that the Circuit Court erred in granting the motion to dismiss (1) as to the wrongful foreclosure claim, by failing to rule against the AOAO for various violations of statutory and procedural requirements in the 2010 Foreclosure Act, and (2) as to the Malabes claims for unfair or deceptive acts or practices (UDAP), by failing to recognize the Malabess standing to bring the action as well as their compliance with the statute of limitations.
(1) The Malabes assert that the Circuit Court erred in failing to recognize the validity of their claim that the AOAO unlawfully invoked Hawaii Revised Statutes (HRS) § 667-5 (Supp. 2010) (repealed 2012)3 in conducting a nonjudicial foreclosure on their unit (the Apartment) at the Executive Centre in Honolulu for which the AOAO is the apartment owners association. In the Complaint, the Malabes asserted that the "AOAO was not authorized or entitled to conduct a nonjudicial foreclosure or power of sale under Part I and the sale that occurred was unlawful and constituted a wrongful foreclosure." On appeal, the Malabes contend that HRS § 667-5 may be used only when a power of sale is contained in a mortgage or other governing document, and that because such a power of sale was not present in this case, the foreclosure was not permitted by Hawaii law.
The Hawaii Supreme Court has held that "[p]rior to its repeal in 2012, HRS § 667-5 authorized the non-judicial foreclosure of mortgaged property only [w]hen a power of sale is contained in a mortgage. " Santiago v. Tanaka, 137 Hawaii 137, 154, 366 P.3d 612, 629 (2016) (emphasis added; footnote omitted) (citing HRS § 667-5 (a) (repealed 2012) ). In Santiago, the supreme court reiterated its prior holding that HRS § 667-5 "[did] not independently provide for a power of sale." Id. at 155, 366 P.3d at 630. Moreover, " no state statute creates a right in mortgagees to proceed by non-judicial foreclosure; the right is created by contract. " Id. (quoting Lee v. HSBC Bank USA, 121 Hawaii 287, 292, 218 P.3d 775, 780 (2009) ).

References: § 667
 § 667
 § 667
 v. 
 § 667
 § 667
 v.