Opinion ID: 2648894
Heading Depth: 3
Heading Rank: 2

Heading: Relevant Procedural History - Circuit Court

Text: Trustee Lambert alleged that the Teisinas owned 3/5824 interest (less than 10,000 square feet) in Parcel 33 and moved for summary judgment to partition their interest along with the remainder of Parcel 33 as well as the Kuleana parcel. The Teisinas opposed summary judgment on the ground that they owned a larger portion of Parcel 33 (10,000 square feet). The circuit court granted summary judgment for partition, appointed a commissioner to sell the parcels at a public auction, and ordered the sale proceeds to be distributed pursuant to court order. The court’s decision was memorialized in the “Order Granting Plaintiff’s Motion for Summary Judgment Regarding Partition and Title, Filed April 26, 2010”, filed on June 20, 2011 (“Summary Judgment Order”). The Summary Judgment Order authorized Trustee Lambert and any party holding a 10% or greater interest in the 4 This was the second partition action filed by the Lambert family. In 1996, the Lambert family sought to partition Parcel 33 and the adjoining Kuleana parcel (Civil No. 96-0859-03) but failed to prosecute their lawsuit following an appeal from a default judgment, see Lambert v. Lua, 92 Hawai#i 228, 990 P.2d 126 (1999), and the case was dismissed. 4 FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER respective parcels to credit bid5 at the auction. The Teisinas’ 3/5824 interest in Parcel 33 was less than a 10% interest. The circuit court stayed the sale for a short time. Trustee Lambert successfully moved to dissolve the stay. At that time, the court affirmatively declared that the Teisinas owned the home they built on Parcel 33 and that they were free to remove or abandon the home. The court also ordered the commissioner to turn over to the Teisinas any monies he collected from the tenants residing at the Teisinas’ house. The Teisinas later moved the court to include their house in the partition sale and requested an evidentiary hearing to establish the enhancement value of their house before the auction could take place. The circuit court included the house in the partition sale but declined to hold an evidentiary hearing on the enhancement value. The circuit court also denied the Teisinas request to allow them to use the enhancement value of their house, which their expert valued at $393,200.00, in lieu of a supersedeas bond for any future stay requests and to allow them to use the value to bid at the auction. 5 A “credit bid” is a bid up to an amount equal to the unpaid principal and interest of a debt, together with costs, fees, and other expenses, without tendering cash. See generally First Commercial Mortg. Co. v. Reece, 89 Cal. App. 4th 731, 737 (Cal. Ct. App. 2d Dist. 2001) (“The purpose of [a credit bid] is to avoid the inefficiency of requiring the lender to tender cash which would only be immediately returned to it.”). 5 FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER When the Teisinas appealed the summary judgment order and several interlocutory orders (CAAP-12-0000529), the circuit court conditioned a stay upon the posting of a $400,000.00 bond. The Teisinas were unable to post a bond and the appeal was eventually dismissed for lack of appellate jurisdiction. The public auction took place on June 5, 2012. There were two bids for Parcel 33 –- a $400,000 bid to include the Teisinas’ house and a $425,000 bid from Trustee Lambert not to include the Teisinas’ house. On October 25, 2012, the circuit court confirmed the sale. The Confirmation Order states that “the Teisinas’ house on Parcel 33 contributed $150,000 in value to the confirmed purchase price of $425,000” and, therefore, “it is appropriate that the Teisinas’ house bear 150/425ths of the fees and costs incurred in this partition as attributed to Parcel 33[.]” After payment of the respective percentage of the commissioner’s fees and expenses ($12,336.52), Trustee Lambert’s attorneys’ fees ($180,000.00) and costs ($4,100.97), and Parcel 33’s real property taxes ($44,914.26), the Teisinas were awarded $71,750.126 to be distributed when they surrendered their house. The circuit court 6 The Teisinas’ share of the sale proceeds was calculated as follows: Share of Gross Proceeds ($425,000) $ 150,000.00 Share of Commissioner’s Fees/Costs ($ 3,918.66) Share of Property Taxes ($ 15,852.09) Share of Trustee Lambert’s Fees/Costs ($ 58,479.13) NET DISTRIBUTION $ 71,750.12 6 FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER ordered the sale to close by November 25, 2012, unless extended, and “retain[ed] jurisdiction, as needed to assure the orderly transition of Parcel 33 and to make any adjustments to the distribution to the Teisinas as may be warranted if there is noncompliance or delay in [peacefully surrendering their house].” In all respects, the Confirmation Order effectively terminated the Teisinas’ rights to the property. Final judgment as to Parcel 33 has not been entered.7