Court Opinion

ID: 4710077
Source: CourtListenerOpinion
Date Created: 2021-08-09 19:05:47.656853+00
Date Added: 2024-06-11T08:07:01.143778
License: Public Domain

NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

                                              Electronically Filed
                                              Intermediate Court of Appeals
                                              CAAP-XX-XXXXXXX
                                              09-AUG-2021
                                              07:46 AM
                                              Dkt. 85 MO
                           NO. CAAP-XX-XXXXXXX

                  IN THE INTERMEDIATE COURT OF APPEALS

                         OF THE STATE OF HAWAI#I

        HSBC BANK USA, NATIONAL ASSOCIATION, AS TRUSTEE FOR
      DEUTSCHE ALT-A SECURITIES, INC., MORTGAGE PASS-THROUGH
          CERTIFICATES SERIES 2005-5, Plaintiff-Appellant,
                                   v.
            ROBERT M. GILLESPIE, JR., Defendant-Appellee,
                                  and
                  MERIDIAN FINANCIAL NETWORK, INC.;
              STATE OF HAWAI#I - DEPARTMENT OF TAXATION;
      UNITED STATES OF AMERICA, DEPARTMENT OF THE TREASURY -
                      INTERNAL REVENUE SERVICE;
      JOHN DOES 1-10; JANE DOES 1-10; DOE PARTNERSHIPS 1-10;
            DOE CORPORATIONS 1-10; DOE ENTITIES 1-10; and
               DOE GOVERNMENTAL UNITS 1-10, Defendants

         APPEAL FROM THE CIRCUIT COURT OF THE SECOND CIRCUIT
                       (CIVIL NO. 2CC141000420)

                           MEMORANDUM OPINION
         (By:   Ginoza, Chief Judge, Leonard and Hiraoka, JJ.)

            Plaintiff-Appellant HSBC Bank USA, National
Association, as Trustee for Deutsche Alt-A Securities, Inc.,
Mortgage Pass-through Certificates Series 2005-5, appeals from
the "Order Granting Defendant Robert M. Gillespie's [sic]
Application for Fees and Costs Filed November 1, 2017," and the
"Amended Final Judgment as to All Claims and All Parties," both
entered by the Circuit Court of the Second Circuit on January 25,
2018.1 For the reasons explained below, we reverse the Order and
vacate the Amended Final Judgment to the extent it awards

     1
            The Honorable Peter T. Cahill presided.
  NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

attorneys' fees, costs, and Hawai#i general excise tax to
Gillespie.

                                      I.

            On July 15, 2014, Bank filed a "Complaint for
Declaratory Judgment" against Defendant-Appellee Robert M.
Gillespie, Jr. and others.2 The Complaint contained the
following allegations: Gillespie executed a promissory Note for
$1.3 million in favor of Meridian Mortgage, Inc.                The Note was
secured by a Mortgage on real property (the Property) owned by
Gillespie. Meridian Mortgage merged with Meridian Financial
Network, Inc. Bank is the "beneficial owner" and holder of the
Note and Mortgage, but no assignment of the Mortgage to Bank was
recorded in the Hawai#i Bureau of Conveyances. Bank sought a
declaration, under Hawaii Revised Statutes (HRS) § 632-1,3 that

      2
            The other named defendants were Meridian Financial Network, Inc.,
State of Hawai#i Department of Taxation, and United States of America
Department of the Treasury — Internal Revenue Service.
      3
            HRS § 632-1 (1993) provides, in relevant part:
            § 632-1   Jurisdiction; controversies subject to.

            (a)   In cases of actual controversy, courts of record,
            within the scope of their respective jurisdictions, shall
            have power to make binding adjudications of right, whether
            or not consequential relief is, or at the time could be,
            claimed, and no action or proceeding shall be open to
            objection on the ground that a judgment or order merely
            declaratory of right is prayed for[.]
            (b)   Relief by declaratory judgment may be granted in civil
            cases where an actual controversy exists between contending
            parties, or where the court is satisfied that antagonistic
            claims are present between the parties involved which
            indicate imminent and inevitable litigation, or where in any
            such case the court is satisfied that a party asserts a
            legal relation, status, right, or privilege in which the
            party has a concrete interest and that there is a challenge
            or denial of the asserted relation, status, right, or
            privilege by an adversary party who also has or asserts a
            concrete interest therein, and the court is satisfied also
            that a declaratory judgment will serve to terminate the
            uncertainty or controversy giving rise to the proceeding.
            Where, however, a statute provides a special form of remedy
            for a specific type of case, that statutory remedy shall be
            followed; but the mere fact that an actual or threatened
            controversy is susceptible of relief through a general
            common law remedy, a remedy equitable in nature, or an
            extraordinary legal remedy, whether such remedy is
                                                                (continued...)

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it was the "legal and beneficial owner of the Note and First
Mortgage." The Complaint did not allege that Gillespie was in
default of the Note. There was no attorney affirmation attached
to the Complaint.4 The Complaint sought no monetary award.
           Gillespie answered the Complaint on November 24, 2015.
           Bank filed its pretrial statement on March 17, 2016.
It stated:

          C.    PLAINTIFF'S CLAIMS

                [Bank's] claim is for declaratory judgment that [Bank]
          is the legal and beneficial owner and holder of the Note and
          Mortgage, which was recorded as Document No. 2005-111439 in
          the Bureau of Conveyances, State of Hawaii. [Bank's] claim
          for declaratory judgment can be established by the fact that
          [Bank] has possession of the original Note.

                [Bank] will be filing a motion for leave to amend its
          complaint to assert a foreclosure claim, which also relates
          to Note and First Mortgage. [Bank] can establish its
          foreclosure claim through its sworn-to copies of the Note
          and First Mortgage, made and given by Defendant Gillespie,
          and either by a Declaration of Indebtedness establishing
          Defendant Gillespie's default under the Note and First
          Mortgage and/or by trial testimony.

          The circuit court set trial for August 28, 2017. The
parties were ordered to submit "a memorandum setting forth each
affirmative claim they shall assert at trial, and the legal basis
and a summary of the evidence supporting each claim." Bank's
"Statement of Affirmative Claims" stated, in relevant part:

                [Bank's] claim for relief as stated in its July 15,
          2014 Complaint for Declaratory Judgment ("Complaint"), is
          for an order declaring [Bank] the legal and beneficial owner

     3
          (...continued)
          recognized or regulated by statute or not, shall not debar a
          party from the privilege of obtaining a declaratory judgment
          in any case where the other essentials to such relief are
          present.
     4
          HRS § 667-17 (1993) provides, in relevant part:
                § 667-17 Attorney affirmation in judicial
          foreclosure. Any attorney who files on behalf of a mortgagee
          seeking to foreclose on a residential property under this
          part shall sign and submit an affirmation that the attorney
          has verified the accuracy of the documents submitted, under
          penalty of perjury and subject to applicable rules of
          professional conduct. The affirmation shall be filed with
          the court at the time that the action is commenced[.]

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          and holder of the Note and Mortgage dated May 31, 2005, from
          Defendant ROBERT M. GILLESPIE JR. to Meridian Mortgage, Inc.
                . . . .
                [Bank] seeks the following relief:

                1.    An order determining [Bank] is the legal and
          beneficial owner and holder of the Note and Mortgaged [sic]
          dated May 31, 2015, recorded in the Bureau of Conveyances of
          the State of Hawaii as Document No. 2005-111439, as amended.
                2.    To enter a final judgment herein pursuant to
          Rule 54(b) of the Hawaii [sic] Rules of Civil Procedure, as
          there is not [sic] just reason for delay.

Bank never amended its Complaint to assert a foreclosure claim.
          A jury-waived trial was conducted on August 28, 2017.
Bank's attorney gave an opening statement:

                Your Honor, this is a action for declaratory judgment.
          It is not a foreclosure action.

                And the issue before this Court is very narrow. If
          [Bank] is the legal and beneficial owner of the note and
          mortgage.

                [Bank] has asserted, since the filing of his [sic]
          complaint, that he [sic] is in possession of the note and as
          the holder of the note has the right to enforce. That is
          the only issue before the Court today.

(emphasis added). Gillespie reserved his opening statement.
          Bank called Gillespie as a witness. Gillespie
testified that he had owned the Property since receiving an
inheritance in 1996. In 2005 he mortgaged the Property for
$1.32 million. The lender was Meridian Mortgage. A copy of the
Mortgage was admitted into evidence as Exhibit 2. The Mortgage
was modified to correct the Property's address. The modification
agreement was admitted into evidence as Exhibit 3. Gillespie
also testified that he executed a promissory note for
$1.32 million, in favor of Meridian Mortgage, on May 31, 2005.
He made monthly $7,150 interest-only payments until June 2008.
          Bank called Loretta Poch as its next witness.
Gillespie objected because Poch's name had not been disclosed
before the deadline for final naming of witnesses. During
argument over the objection the following exchange took place:

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                [BANK'S COUNSEL]: Um, the issue before this Court is
          very narrow, as I stated at opening. It is just whether
          [Bank] is entitled to enforce the note. [Bank] has --

                THE COURT:   No, that's not correct.
                [BANK'S COUNSEL]:    I apologize, your Honor --
                THE COURT:   This is not a foreclosure.

                [BANK'S COUNSEL]: -- the legal, yes.      The legal and
          beneficial owner of the note.
                . . . .

                THE COURT: So tell me what this witness knows and how
          she's going to establish what's been going on here in the
          paperwork, other than these documents? Does she have
          personal knowledge of this stuff?

                [BANK'S COUNSEL]: Your Honor, the witness does not
          have personal knowledge of the merger of Meridian Financial
          and Meridian Mortgage.

                The witness is -- will testify that she is -- has
          personal knowledge of the record keeping system of
          Specialized Loan Service, Inc. who is the loan servicer for
          [Bank], and the servicer for the subject loan at issue
          before the Court.

                She also notes -- states that she -- that Specialized
          Loan Servicing received the note from the prior servicer.
          Um, and that she will attest to the loan keep -- the record
          keeping and to the records of the [Bank].
                THE COURT: Well, here's my difficulty, [Bank's
          counsel]. This is not a mortgage foreclosure action as we
          understand. You are asking -- you are claiming under
          declaratory relief statute, even though it does say
          foreclosure, I understand (inaudible).

                You are claiming that there is a controversy in
          existence such that the Court needs to intervene. And then
          the requested relief is, I -- I would say it's equitable in
          nature.

                Because you're asking that I issue an order and a
          judgment directing the clerk of the court to, ah, assign the
          mortgage to your client. Is that what you're requesting?

                [BANK'S COUNSEL]:    No, your Honor, that is not what we
          are requesting.
                THE COURT:   What are you requesting?
                [BANK'S COUNSEL]: We are asking for the Court to find
          [Bank] as the legal and beneficial owner of the note. There
          is no request for any assignment of mortgage by the clerk.

                THE COURT:   Okay.   All right.

(emphasis added).

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          The circuit court sustained Gillespie's objection.
Poch did not testify. Bank's Exhibit 1, a copy of the Note, was
marked for identification. Bank moved to admit Exhibit 1 into
evidence. Gillespie objected. The circuit court sustained the
objection. The Note was never received in evidence.5
          Bank rested, calling no further witnesses. Gillespie
moved "for judgment in the alternative to dismiss the lawsuit."
The circuit court orally granted the motion to dismiss.6
          On October 18, 2017, the court entered "Court's
Findings of Fact, Conclusions of Law and Order of Dismissal With
Prejudice."   The court found and concluded:

                21.   [Bank] rested.

                22.   [Gillepsie] moved for dismissal on the grounds
          that [Bank] failed to establish that it held the Note.

                23.   The Court granted the motion to dismiss.

                . . . .
                6.    The Court further concludes as a matter of law
          that in the absence of evidence that [Bank] has possession
          of the original Note it failed to prove by the preponderance
          of the evidence its entitlement to a declaration that it is
          the beneficial and legal owner of the Note.

On October 18, 2017, the court also entered a "Final Judgment as
to All Claims and All Parties."
          On November 1, 2017, Gillespie ex officio filed an
application for attorneys' fees and costs, citing HRS §§ 607-14
(actions in the nature of assumpsit) and 607-14.5 (frivolous
complaint).
          On November 17, 2017, Bank filed a motion to clarify
the Order of Dismissal With Prejudice. The motion was heard on
December 22, 2017, along with the hearing on Gillespie's motion
for fees and costs. During the hearing the following exchange
took place:

                THE COURT: Okay. What was the basis for your client
          seeking the declaratory judgment?

     5
          Bank has not appealed from the evidentiary ruling.
     6
          Bank has not appealed from the dismissal ruling.

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              [BANK'S COUNSEL]: It was my understanding because
        there was no assignment of mortgage, it was determined that
        an order would be beneficial to clarify that the mortgage is
        -- and the note transferred together to [Bank].
              THE COURT: But your client asserts that it is the
        owner of the note. . . .
              [BANK'S COUNSEL]:   Yes.

              . . . .
              THE COURT: And that note was a contract that
        Mr. Gillespie purportedly entered into between himself and
        the original lender. That's what a promissory note is.
        It's a contract, right?

              [BANK'S COUNSEL]:   Yes, your Honor.
               THE COURT: And that contract provides for the
        recovery of attorney's fees and costs if the lender, if the
        -- if the borrower defaults and the lender has to sue,
        right?

              [BANK'S COUNSEL]:   Yes, your Honor.

               THE COURT: Okay. So the entire cause of action that
        your client brought was based upon its asserted belief,
        which it will continue to assert, I'm assuming, into the
        future and in any contested action in the future, that
        Mr. Gillespie is bound by the terms of that promissory note,
        right?
              [BANK'S COUNSEL]: Your Honor, in this action, we're
        not arguing that Mr. Gillespie is bound by the terms of the
        note.

              THE COURT: I know. I understand that. But the basis
        for your seeking this declaration is and only is that
        contract, right? It's not based upon some other grounds.

              [BANK'S COUNSEL]:   Yes, your Honor.

              THE COURT: Okay. I mean, presumably your client
        bought this note. That's what the argument is going down
        and what it was in the past. They bought a note. They
        never got the assignment of the mortgage, and they're
        pursuing, and they wanted this action.

              I have to tell you, [Bank's counsel], I totally agree
        -- and [Gillespie's counsel] can tell you how many times I
        totally agree with him. I think this may be the first. But
        I totally agree with him.
              This is basically an action -- it's a very clever way
        of saying it's not an action in the nature of assumpsit, but
        it's based totally upon what your client is asserting. It
        is asserting that it is the owner of a contract, and it
        failed to prove that.

              . . . .
              So I do view this -- despite the fact that it was
        seeking a declaration, the declaration sought was that it
        owned a contract and the -- and the rights that went with

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          that contract that Mr. Gillespie had purportedly entered
          into. And when it failed to prove that, it lost. It is the
          losing party in what is in effect a claim in assumpsit.

                And even if that were not the case, the very nature of
          this matter, frankly, cries out for some relief to
          Mr. Gillespie, who was forced to defend something that both
          maybe legal -- legally and factually appears not to have
          been necessary at all. And, therefore, I'm granting
          [Gillespie's] request for attorney's [sic] fees and costs in
          their entirety.

(emphasis added).
           On January 25, 2018, the circuit court entered the
Order and the Amended Final Judgment. Gillespie was awarded
$58,493.25 in attorneys' fees, $2,546.10 in costs, and $2,876.17
in Hawai#i general excise taxes. This appeal followed.

                                   II.

          Bank contends that the circuit court erred by:
(1) awarding Gillespie attorneys' fees; and (2) awarding
Gillespie costs. We review awards of attorneys' fees and costs
under the abuse of discretion standard. Enoka v. AIG Hawaii Ins.
Co., 109 Hawai#i 537, 544, 128 P.3d 850, 857 (2006).

          The trial court abuses its discretion if it bases its ruling
          on an erroneous view of the law or on a clearly erroneous
          assessment of the evidence. Stated differently, an abuse of
          discretion occurs where the trial court has clearly exceeded
          the bounds of reason or disregarded rules or principles of
          law or practice to the substantial detriment of a party
          litigant.

Id.

          A.    Attorneys' Fees

          HRS § 607-14 (2016) provides:

                § 607-14 Attorneys' fees in actions in the nature of
          assumpsit, etc.

          In all the courts, in all actions in the nature of assumpsit
          and in all actions on a promissory note or other contract in
          writing that provides for an attorney's fee, there shall be
          taxed as attorneys' fees, to be paid by the losing party and
          to be included in the sum for which execution may issue, a
          fee that the court determines to be reasonable; provided
          that the attorney representing the prevailing party shall
          submit to the court an affidavit stating the amount of time
          the attorney spent on the action and the amount of time the
          attorney is likely to spend to obtain a final written

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          judgment, or, if the fee is not based on an hourly rate, the
          amount of the agreed upon fee. The court shall then tax
          attorneys' fees, which the court determines to be
          reasonable, to be paid by the losing party; provided that
          this amount shall not exceed twenty-five per cent of the
          judgment.

          Where the note or other contract in writing provides for a
          fee of twenty-five per cent or more, or provides for a
          reasonable attorney's fee, not more than twenty-five per
          cent shall be allowed.
          Where the note or other contract in writing provides for a
          rate less than twenty-five per cent, not more than the
          specified rate shall be allowed.
          Where the note or other contract in writing provides for the
          recovery of attorneys' fees incurred in connection with a
          prior debt, those attorneys' fees shall not be allowed in
          the immediate action unless there was a writing authorizing
          those attorneys' fees before the prior debt was incurred.
          "Prior debt" for the purposes of this section is the
          principal amount of a debt not included in the immediate
          action.
          The above fees provided for by this section shall be
          assessed on the amount of the judgment exclusive of costs
          and all attorneys' fees obtained by the plaintiff, and upon
          the amount sued for if the defendant obtains judgment.

          Nothing in this section shall limit the recovery of
          reasonable attorneys' fees and costs by a planned community
          association and its members in actions for the collection of
          delinquent assessments, the foreclosure of any lien, or the
          enforcement of any provision of the association's governing
          documents, or affect any right of a prevailing party to
          recover attorneys' fees in excess of twenty-five per cent of
          the judgment pursuant to any statute that specifically
          provides that a prevailing party may recover all of its
          reasonable attorneys' fees. "Planned community association"
          for the purposes of this section means a nonprofit
          homeowners or community association existing pursuant to
          covenants running with the land.

(emphasis added). The circuit court agreed with Gillespie that
Bank was "the losing party in what is in effect a claim in
assumpsit[,]" and awarded attorneys' fees and costs to Gillespie.
We conclude the circuit court erred.
           Assumpsit is "a common law form of action which allows
for the recovery of damages for the non-performance of a
contract, either express or implied, written or verbal, as well
as quasi contractual obligations." Eastman v. McGowan, 86
Hawai#i 21, 31, 946 P.2d 1317, 1327 (1997) (quoting S. Utsunomiya
Enters., Inc. v. Moomuku Country Club, 76 Hawai#i 396, 399-400,
879 P.2d 501, 504-505 (1994) (citing Schulz v. Honsador, Inc., 67

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Haw. 433, 435–36, 690 P.2d 279, 281 (1984))). In this case, Bank
did not seek a "recovery of damages" from Gillespie for "non-
performance" under the Note. Bank's Complaint did not allege
that Gillespie was in default under the Note, or otherwise seek a
monetary judgment against Gillespie. Bank's Complaint was not
accompanied by an attorney affirmation, which was required under
HRS § 667-17 if Bank sought to foreclose on the Mortgage. Bank
only sought a declaratory judgment, under HRS § 632-1, that it
was the "legal and beneficial owner of the Note and First
Mortgage."
           Under similar circumstances, the Hawai#i Supreme Court
held it error to award attorneys' fees under HRS § 607-14 in a
declaratory judgment action, even though the declaratory judgment
action involved a contract. Chock v. Gov't Emps.' Ins. Co., 103
Hawai#i 263, 81 P.3d 1178 (2003). In that case, Hunt and Chock
were sitting in different motor vehicles parked next to each
other. Hunt shot Chock. Hunt's vehicle was uninsured. Chock
was sitting in a pickup truck owned by his girlfriend (Lee) and
insured by GEICO. At the time, Chock was living with his father
(Glenn), who was also insured by GEICO. Glenn, on behalf of
Chock, made a claim for uninsured motorist (UM) benefits under
Lee's and Glenn's GEICO insurance policies. GEICO denied both
claims. Chock filed a complaint for declaratory judgment against
GEICO, asking that the circuit court rule he was entitled to UM
benefits under Glenn's and Lee's insurance policies. GEICO filed
a complaint for declaratory judgment against Chock, asking that
the circuit court rule that Chock was not entitled to UM benefits
under Glenn's or Lee's insurance policies. The circuit court
consolidated the declaratory judgment actions. After a bench
trial the circuit court ruled in favor of GEICO and awarded
attorneys' fees and costs to GEICO. Chock appealed.
          The supreme court affirmed the coverage determination,
holding that Chock was not entitled to UM benefits because his
injuries did not arise from the "operation, maintenance, or use
of a motor vehicle." Chock, 103 Hawai#i at 268, 81 P.3d at 1183.

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However, the supreme court vacated the award of attorneys' fees
to GEICO, holding:

                The circuit court erred in awarding attorneys' fees to
          GEICO pursuant to HRS § 607–14 (Supp. 1998) in this
          declaratory judgment consolidated action. The relief sought
          by Chock and GEICO was a declaration as to the applicability
          of insurance coverage for Chock's injuries, not money
          damages. As we have previously held, "[w]hen the recovery
          of money damages is not the basis of a claim factually
          implicating a contract, the action is not 'in the nature of
          assumpsit.'" Leslie v. Estate of Tavares, 93 Hawai#i 1, 7,
          994 P.2d 1047, 1053 (2000). An action that seeks only a
          declaration as to a party's rights or responsibilities, even
          if factually implicating a contract, is not "in the nature
          of assumpsit." Therefore, GEICO cannot recover attorneys'
          fees from Chock because HRS § 607–14 does not provide for
          attorneys' fees in declaratory judgment actions.

Id. (emphasis added) (footnote omitted).
           In this case, Bank's Complaint sought only a
declaration under HRS § 632-1 that Bank was the legal and
beneficial owner and holder of the Note and Mortgage. The
Complaint did not allege that the promisor was in default. The
Complaint did not seek foreclosure of the mortgage that secured
the Note. Even though the Complaint implicated the Note and
Mortgage, which were contracts, it was not in the nature of
assumpsit. Gillespie was not entitled to attorneys' fees under
HRS § 607-14.
           Gillespie argues that "HRS Section 607-14 applies in
cases in which 'no money damages are sought or awarded, as in a
complaint for declaratory relief [sic],'" citing Amfac, Inc. v.
Waikiki Beachcomber Inv. Co., 74 Haw. 85, 134-35, 839 P.2d 10[,
35] (1992). Amfac applied former HRS § 607–17, which was
repealed in 1993. Chock, which applied HRS § 607-14 and was
decided after Amfac, controls.
           Gillespie also cites Ranger Ins. Co. v. Hinshaw, 103
Hawai#i [26], 79 P.3d 119 (2003). That case was also a
declaratory judgment action involving an insurance policy.
Ranger's policyholder was sued for negligence. Ranger provided
its policyholder with a defense, subject to a reservation of
rights. Ranger also filed the declaratory judgment action
against its policyholder seeking, among other things,

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"reimbursement of attorney's fees and costs [it paid] in the
defense of the underlying [tort] case[.]" Id. at 30, 79 P.3d at
123. The tort lawsuit was settled and dismissed with prejudice.
Ranger's declaratory judgment action was dismissed on Ranger's
motion. Ranger's policyholder then filed a motion in the
declaratory judgment action for attorneys' fees and costs. The
circuit court denied the motion. The policyholder appealed. The
supreme court vacated the order, holding that the policyholder
was entitled to recover attorneys' fee under HRS § 607-14 because
"Ranger's request for [reimbursement of] attorneys' fees and
costs for the defense it provided in [the tort] lawsuit
constitutes a request for consequential damages. Thus, Ranger's
declaratory [judgment] action is in the nature of assumpsit[.]"
Id. at 33-34, 79 P.3d at 126-27 (citation omitted). In this
case, Bank's Complaint did not pray for an award of damages or
any other monetary recovery. Gillespie was not entitled to
recover attorneys' fees under HRS § 607-14.
          HRS § 607-14.5 (2016) provides, in relevant part:

                § 607-14.5. Attorneys' fees and costs in civil
          actions.

          (a)   In any civil action in this State where a party seeks
          money damages or injunctive relief, or both, against another
          party, and the case is subsequently decided, the court may,
          as it deems just, assess against either party, whether or
          not the party was a prevailing party, and enter as part of
          its order, for which execution may issue, a reasonable sum
          for attorneys' fees and costs, in an amount to be determined
          by the court upon a specific finding that all or a portion
          of the party's claim or defense was frivolous as provided in
          subsection (b).
          (b)   In determining the award of attorneys' fees and costs
          and the amounts to be awarded, the court must find in
          writing that all or a portion of the claims or defenses made
          by the party are frivolous and are not reasonably supported
          by the facts and the law in the civil action.

          HRS § 607-14.5 authorizes an award of attorneys' fees
"upon a specific finding that all or a portion of the party's
claim or defense was frivolous as provided in subsection (b)."
Under HRS § 607-14.5(b), "the court must find in writing that all
or a portion of the claims or defenses made by the party are
frivolous and are not reasonably supported by the facts and the

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law in the civil action." In this case the circuit court did not
find in writing that any of the claims made by Bank were
frivolous or not reasonably supported by the facts and the law.
The circuit court was not authorized to award attorneys' fees
under HRS § 607-14.5.

          B.     Costs

          Gillespie's application for costs cited HRS §§ 607-14
and 607-14.5. The circuit court's Order cited no other authority
for awarding costs.
          HRS § 607-14 pertains to attorneys' fees in actions in
the nature of assumpsit, etc. It does not authorize an award of
costs.
          The circuit court was not authorized to award costs
under HRS § 607-14.5 because it did not find in writing that any
of the claims made by Bank were frivolous or not reasonably
supported by the facts and the law.

                                III.

           Based upon the foregoing, the "Order Granting Defendant
Robert M. Gillespie's [sic] Application for Fees and Costs Filed
November 1, 2017," entered on January 25, 2018, is reversed; the
"Amended Final Judgment as to All Claims and All Parties,"
entered on January 25, 2018, is vacated to the extent it awards
attorneys' fees, costs, and Hawai#i general excise tax to
Gillespie.
           DATED: Honolulu, Hawai#i, August 9, 2021.

On the briefs:
                                       /s/ Lisa M. Ginoza
Charles R. Prather,                    Chief Judge
Robin Miller,
Peter T. Stone,                        /s/ Katherine G. Leonard
for Plaintiff-Appellant.               Associate Judge

Gary V. Dubin,                         /s/ Keith K. Hiraoka
Frederick J. Arensmeyer,               Associate Judge
for Defendant-Appellee
Robert M. Gillespie, Jr.

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