Court Opinion

ID: 4514507
Source: CourtListenerOpinion
Date Created: 2020-03-10 23:02:59.129279+00
Date Added: 2024-06-11T09:49:04.689142
License: Public Domain

***FOR PUBLICATION IN WEST’S HAWAII REPORTS AND PACIFIC REPORTER***

                                                              Electronically Filed
                                                              Supreme Court
                                                              SCWC-XX-XXXXXXX
                                                              10-MAR-2020
                                                              11:33 AM

           IN THE SUPREME COURT OF THE STATE OF HAWAII

                                ---o0o---

 TRUSTEES OF THE ESTATE OF BERNICE PAUAHI BISHOP, also known as
    KAMEHAMEHA SCHOOLS, Respondents/Plaintiffs-Counterclaim
                      Defendants-Appellees,

                                    vs.

 RONALD G.S. AU, Petitioner/Defendant-Counterclaimant-Appellant.

                            SCWC-XX-XXXXXXX

         CERTIORARI TO THE INTERMEDIATE COURT OF APPEALS
              (CAAP-XX-XXXXXXX; CIV. NO. 13-1-0420)

                             MARCH 10, 2020

 RECKTENWALD, C.J., NAKAYAMA, McKENNA, POLLACK, AND WILSON, JJ.

                OPINION OF THE COURT BY POLLACK, J.

          Chapter 634J of the Hawaiʻi Revised Statutes authorizes

a court to enter an order declaring a plaintiff to be a

vexatious litigant in particularly defined circumstances.             The

circuit court in this case determined that the defendant

qualified as a “plaintiff” for the purpose of the vexatious

litigant statute and that the required circumstances were
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demonstrated.   The Intermediate Court of Appeals affirmed the

circuit court’s ruling.

          Upon review of the vexatious litigant statute and its

legislative history, we hold that the circuit court and

Intermediate Court of Appeals erred in determining that the

defendant in this case qualified as a “plaintiff” and that other

requirements set forth in the statute were satisfied.            We also

hold that a court’s vexatious litigant determination must be

supported by findings that set forth, with reasonable

specificity, the perceived misconduct, including a finding of

bad faith when applicable.       Finally, we conclude that the record

does not show that the motions underlying the vexatious litigant

order in this case were made in bad faith.

                            I.   BACKGROUND

          On June 17, 1970, the Trustees of the Estate of

Bernice Pauahi Bishop (Bishop Estate) leased a parcel of land

located in Honolulu, Hawaiʻi (the property), to Kam Wo Wong and

Lillie Choy Wong as joint tenants for a period of 53 years and 9

months.   On June 1, 1978, the Wongs assigned their interest in

the lease to Ronald G.S. Au.      In 2010, Bishop Estate filed a

complaint against Au alleging he had breached the lease

agreement and seeking damages and possession of the property.

Au counterclaimed, alleging, inter alia, that Bishop Estate had

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breached the lease agreement and was engaging in retaliatory

eviction.    The parties entered into a settlement agreement on

August 24, 2012 (settlement agreement).          By the terms of the

settlement agreement, Au had until a date certain to pay lease

payments owed to Bishop Estate in the principal amount of

$62,000.

            On February 13, 2013, Bishop Estate filed a complaint

against Au in the Circuit Court of the First Circuit (circuit

court),1 alleging that Au had breached the settlement agreement

by failing to make the required payment by December 31, 2012,

and that Au’s breach entitled Bishop Estate to damages,

termination of the lease, and possession of the property.             On

August 2, 2013, Au, proceeding pro se, filed a counterclaim, and

later a first amended counterclaim, which included claims that

Bishop Estate had breached the lease and the settlement

agreement by unreasonably withholding permission to allow him to

assign one-half of his lease interest to a third party (the

lease interest), that the settlement agreement as written was

void and unenforceable because the parties had agreed that the

amount would be due December 31, 2013, not December 31, 2012,

that Bishop Estate had tortiously interfered in Au’s assignment

     1
            The Honorable Rhonda A. Nishimura presided over the proceedings.

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of the lease interest in the property to a third party, and that

Bishop Estate had engaged in a retaliatory eviction.

          On June 6, 2013, Bishop Estate moved for summary

judgment of the claims in its complaint, asserting that it was

entitled to immediate termination of the lease and repossession

of the property based on Au’s failure to comply with the terms

of the settlement agreement.      Au opposed the motion, arguing

that his failure to make payment on December 31, 2012, was due

to Bishop Estate tortiously interfering in his assignment of the

lease interest and that payment was actually due on December 31,

2013.   The circuit court granted Bishop Estate’s motion for

summary judgment and entered an order on September 18, 2013,

terminating the lease and awarding Bishop Estate damages in the

amount of $130,735.40 and possession of the property (summary

judgment order).

          On September 25, 2013, Au filed a motion for

reconsideration of the summary judgment order (motion for

reconsideration), arguing the court had not considered the

claims and affirmative defenses in his counterclaim,

specifically his claim of retaliatory eviction, and that if it

had, summary judgment would not have been granted in Bishop

Estate’s favor.    In response, Bishop Estate asserted that each

argument in the motion for reconsideration had either been

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raised in Au’s opposition to the motion for summary judgment or

was untimely and therefore waived.        The court denied the motion

for reconsideration on April 30, 2014, stating its decision was

based on its review of the record and “good cause.”

          On March 12, 2015, Bishop Estate filed a motion for

summary judgment on Au’s first amended counterclaim, arguing it

had not breached the lease by withholding consent to assignment

of Au’s lease interest because it had an unqualified right to

withhold consent, and thus it could not have tortiously

interfered with Au’s assignment of the lease interest or

unreasonably withheld consent.       In opposition, Au maintained

that Bishop Estate had fraudulently induced his assent to the

settlement agreement, had breached the lease by refusing to

permit assignment of his interest in the lease, and had violated

statutory provisions proscribing unfair and deceptive business

practices.   At the April 16, 2015 hearing, the court orally

granted the motion.     In its written order, filed on May 18, 2015

(counterclaim summary judgment order), the court found that Au

failed to submit evidence that the settlement agreement was

obtained by fraud or that Bishop Estate had unreasonably

withheld permission to assign Au’s interest in the lease.

          A month before the circuit court issued the

counterclaim summary judgment order, Au filed a motion to vacate

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or set aside the summary judgment order under Hawaii Rules of

Civil Procedure (HRCP) Rule 60(b) (Rule 60(b) motion to vacate).2

Au contended that the $62,000 principal amount due under the

settlement agreement was for real property taxes Bishop Estate

had paid, which had been incorrectly calculated because Bishop

Estate had failed to consider refunds Au had obtained through

certain tax appeals.     Bishop Estate countered that any argument

as to the accuracy of the calculations should have been raised

during earlier proceedings and was not a basis to reconsider the

court’s summary judgment order.

          The circuit court denied Au’s Rule 60(b) motion to

vacate at a hearing held on May 13, 2015.         In its oral ruling,

the court indicated that Au’s motion had been filed more than

one year after the entry of the summary judgment order, but the

court reviewed the merits of the motion, “notwithstanding the

     2
          HRCP Rule 60(b) (2006) provides in relevant part as follows:

          On motion and upon such terms as are just, the court may
          relieve a party or a party’s legal representative from a
          final judgment, order, or proceeding for the following
          reasons: (1) mistake, inadvertence, surprise, or excusable
          neglect; (2) newly discovered evidence which by due
          diligence could not have been discovered in time to move
          for a new trial under Rule 59(b); (3) fraud (whether
          heretofore denominated intrinsic or extrinsic),
          misrepresentation, or other misconduct of an adverse party;
          . . . . The motion shall be made within a reasonable time,
          and for reasons (1), (2), and (3) not more than one year
          after the judgment, order, or proceeding was entered or
          taken.

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timeliness issue as to when the motion could [or] should have

been brought.”    The court found that Au’s calculations were not

reliable because he did not explain them or identify supporting

sources, and that Au did not exercise appropriate diligence as

he could have raised the issue earlier.         The court’s oral

findings were set forth in a June 2, 2015 written order.

However, two weeks before entry of the written order, Au filed a

motion to reconsider the court’s denial of his Rule 60(b) motion

to vacate (renewed motion to vacate).        Au proffered declarations

from his accountant to substantiate his contention that the

settlement agreement amount of $62,000 was incorrectly

calculated and to demonstrate the reliability of his own

calculations.    Bishop Estate contended that the motion was

untimely, the argument had been waived, and, in any event, Au’s

calculations remained inaccurate.

          On May 29, 2015, again prior to the entry of the June

2, 2015 order, Au had filed a motion for reconsideration of the

counterclaim summary judgment order (motion to reconsider CCSJ

order).   Au asserted that, because of his argument in the

renewed motion to vacate that the settlement amount of $62,000

was based on erroneous calculations, vacatur of the summary

judgment order entered in favor of Bishop Estate would also

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permit reconsideration of the counterclaim summary judgment

order.

           The court entered final judgment on June 12, 2015.

The final judgment terminated Au’s interest in the property,

returned possession of the property to Bishop Estate, and

awarded a monetary judgment against Au in the amount of

$130,735.40.

           On June 16, 2015, Au filed a notice of appeal.3            On

that same day, the court issued an order denying Au’s renewed

motion to vacate, summarily ruling that its decision was based

on its review of the motion, memoranda, declarations, and

exhibits filed in support of and in opposition to the motion.

Two days later, the court by minute order denied Au’s motion to

reconsider CCSJ order.      A written order denying the motion was

entered on August 19, 2015, again stating only that the decision

was based on the court’s review of the record.4

           On June 29, 2015, Au filed a motion to vacate the

final judgment (motion to vacate final judgment).            Au maintained
      3
            This appeal was heard by the Intermediate Court of Appeals (ICA)
in CAAP-15-466. In an amended summary disposition order entered on December
22, 2017, the ICA affirmed the circuit court’s final judgment and award of
attorneys’ fees in favor of Bishop Estate.
     4
            On June 26, 2015, Bishop Estate filed a motion for the award of
costs and a motion for an award of attorneys’ fees, which Au opposed. On
August 14, 2015, the circuit court granted in part and denied in part these
motions.

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that the final judgment was premature because it was entered

before the court’s denial of his renewed motion to vacate and

the motion to reconsider CCSJ order.         Since these motions were

still pending at the time the court entered final judgment, Au

contended the judgment could not have been a final, appealable

judgment because the motions presented unresolved, non-

collateral issues.      Au contended that because the judgment had

not resolved all issues in the case, his notice of appeal filed

on June 16, 2015, would be dismissed as premature.            Bishop

Estate responded that the court was not required to rule on Au’s

pending motions for reconsideration before entering final

judgment.5    On August 26, 2015, the court issued an order denying

Au’s motion.

             On August 25, 2015, prior to the court’s denial of his

motion to vacate final judgment, Au filed a motion for

correction, modification, or relief from judgment under HRCP

Rule 60(b) (motion for correction).         Au reiterated his argument

that the entry of final judgment was premature and asked that

the court vacate the final judgment of June 12, 2015, and enter

the August 19, 2015 order in which the court denied Au’s motion

     5
            Bishop Estate argued that, to the extent Au’s pending motions
were prejudgment motions, the entry of judgment constituted a denial of those
motions, and to the extent the motions were post-judgment motions, the court
was not required to rule on them before entry of judgment.

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to reconsider CCSJ order as a final order.         Au contended this

was necessary for him to properly appeal the court’s denial of

his motion.   Bishop Estate responded that the court was not

required to rule on the motion to reconsider CCSJ before entry

of final judgment in order for Au to appeal its denial.            Bishop

Estate also asked the court to declare Au a vexatious litigant

pursuant to Hawaii Revised Statutes (HRS) § 634J-7.6           Bishop

Estate stated that its request was based on Au’s repeated

assertion of previously decided arguments, particularly his

contention that the amount owed under the settlement agreement

was incorrectly calculated.      During the hearing on September 18,

2015, Au withdrew his motion for correction.          The court minutes

do not reflect a ruling on Bishop Estate’s request that Au be

deemed a vexatious litigant.

          On December 17, 2015, Au filed a motion to stay

enforcement of the final judgment pending determination of the

amount of a supersedeas bond (motion to stay).          Au argued that

     6
          HRS § 634J-7 (1993) provides in relevant part as follows:

          [T]he court, on its own motion or the motion of any party,
          may enter a prefiling order which prohibits a vexatious
          litigant from filing any new litigation in the courts of
          this State on the litigant’s own behalf without first
          obtaining leave of the presiding judge of the court where
          the litigation is proposed to be filed. Disobedience of
          this order by a vexatious litigant may be punished as a
          contempt of court.

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the amount of the supersedeas bond should not be set by the

amount set forth in the final judgment because certain

attorneys’ fees had erroneously been awarded because of the

pending appeal of the amount calculated to be owed under the

settlement agreement.      Bishop Estate argued in response that Au

was attempting to relitigate the amount owed under the

settlement agreement and the amount of attorneys’ fees awarded.

In a subsequent motion, Au proffered a lien on certain real

property owned by Au and his wife as an alternative to posting a

bond.

           Before the hearing on these motions, Bishop Estate

filed a motion to declare Au a vexatious litigant under HRS

§ 634J-1(2) and (3) based on Au’s repeated assertion of

arguments that Bishop Estate contended were already resolved.

Bishop Estate identified seven motions filed by Au that it

maintained were attempts to relitigate already resolved issues.7

Au argued in opposition that he, as a defendant in the action,

could not be declared a vexatious litigant and that in any event

his motions had never been determined to be frivolous or made in

bad faith.    Au asserted that Bishop Estate’s motion was intended

     7
            The seven motions identified by Bishop Estate were Au’s
(1) motion for reconsideration; (2) Rule 60(b) motion to vacate; (3) renewed
motion to vacate; (4) motion to reconsider CCSJ order; (5) motion to vacate
final judgment; (6) motion for correction; and (7) motion to stay.

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only to harass him and asked that the court impose monetary

sanctions against Bishop Estate under HRCP Rule 11.               After

hearing arguments, the court granted the motion, declaring Au a

vexatious litigant.8

            The circuit court thereafter issued a written order

granting the motion (vexatious litigant order).           The court

concluded Au met HRS § 634J-1’s definition of “plaintiff”

because he had, through the seven identified motions, sought to

relitigate the merits of the summary judgment order and thereby

“maintained” the litigation.        The court also found that because

Au’s multiple motions, which had all received adverse rulings,

sought to relitigate the summary judgment order, Au met the

definition of a vexatious litigant under either HRS § 634J-1(2)

or (3).9   Au filed an interlocutory appeal challenging the

vexatious litigant order.

     8
            Before ruling on the vexatious litigant motion, the court orally
denied Au’s motion to stay and motion to post supersedeas bond. The court
later issued a written order denying the motions on the basis that Au had
failed to demonstrate that his proffered alternative of a lien on real
property was an adequate substitute for a bond.
     9
            HRS § 634J-1(2) and (3) (1993) provide as follows:

            “Vexatious litigant” means a plaintiff who does any of the
            following: . . .

            (2) After litigation has been finally resolved against the
            plaintiff, relitigates or attempts to relitigate in propria
            persona and in bad faith, either:

                                                                 (continued. . .)
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                         II.    ICA PROCEEDINGS

            In a Summary Disposition Order filed June 28, 2019,

the ICA affirmed the circuit court’s interpretation of HRS

§ 634J-1, holding that Au qualified as a “plaintiff” because he

maintained the litigation through the numerous motions he filed

in this case.10     The ICA also determined that Au met the

definition of a vexatious litigant under HRS § 634J-1(2),

concluding that Au sought to relitigate the merits of issues

that the court had already resolved through his contention that

the settlement amount was incorrectly calculated in the seven

motions identified by Bishop Estate.11

(. . .continued)

                   (A) The validity of the determination against the
                   same defendant or defendants as to whom the
                   litigation was finally determined; or

                   (B) The cause of action, claim, controversy, or any
                   of the issues of fact or law, determined or concluded
                   by the final determination against the same defendant
                   or defendants as to whom the litigation was finally
                   determined;

            (3) In any litigation while acting in propria persona,
            files, in bad faith, unmeritorious motions, pleadings, or
            other papers, conducts unnecessary discovery, or engages in
            other tactics that are frivolous or solely intended to
            cause unnecessary delay[.]
      10
            Additionally, the ICA observed in a footnote that “at least for
the purposes of his counterclaims, Au is a plaintiff as he commenced or
instituted those claims.”
      11
            The ICA observed that it had recently held in CAAP-XX-XXXXXXX
that Au knew or should have known about the incorrectly calculated amount at

                                                               (continued. . .)
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            The ICA held that the circuit court was not required

to make a specific finding that any of Au’s motions were made in

bad faith and that bad faith could be inferred from Au’s

reassertion of the same argument in different motions.12

Further, the ICA determined, HRS chapter 634J did not require

specific findings of fact or conclusions of law to be made.

            The ICA therefore concluded that the circuit court did

not abuse its discretion in declaring Au a vexatious litigant

and affirmed the vexatious litigant order.13

                     III.    STANDARDS OF REVIEW

            The interpretation of a statute is a question of law

reviewable de novo.      Tax Found. v. State, 144 Hawaiʻi 175, 185,

439 P.3d 127, 137 (2019).

            A vexatious litigant determination is reviewed under

an abuse of discretion standard.          Ek v. Boggs, 102 Hawaiʻi 289,

294, 75 P.3d 1180, 1185 (2003).        “[A]n abuse of discretion

(. . .continued)

the time of the summary judgment motions and therefore it could not provide a
basis for reconsideration under HRCP Rule 60(b).

      12
            The ICA concluded that the circuit court was entitled to rely on
a presumption of the correctness of its prior rulings, rejecting Au’s
argument that the court could not deem him a vexatious litigant on the basis
of motions that had been appealed.
      13
            The ICA found it unnecessary to determine whether Au met the
definition under HRS § 634J-1(3).

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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.

(alterations in original) (quoting Ass’n of Apartment Owners of

Wailea Elua v. Wailea Resort Co., 100 Hawaiʻi 97, 119, 58 P.3d
608, 630 (2002)).

                          IV.    DISCUSSION

   A. Au Does Not Meet the Definition of “Plaintiff” Under HRS
                              § 634J-1.

          HRS § 634J-7 empowers a court to enter a prefiling

order prohibiting a vexatious litigant from filing any new

litigation on the litigant’s own behalf without first obtaining

leave of the presiding judge of the court where the litigation

is proposed to be filed.14      As set forth by HRS § 634J-1, a

“vexatious litigant” for purposes of HRS § 634J-7 must be a

“plaintiff.”   HRS § 634J-1 defines “plaintiff” as “the person

who commences, institutes or maintains litigation or causes it

     14
          As stated, HRS § 634J-7 provides in relevant part as follows:

          [T]he court, on its own motion or the motion of any party,
          may enter a prefiling order which prohibits a vexatious
          litigant from filing any new litigation in the courts of
          this State on the litigant’s own behalf without first
          obtaining leave of the presiding judge of the court where
          the litigation is proposed to be filed. Disobedience of
          this order by a vexatious litigant may be punished as a
          contempt of court.

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to be commenced, instituted, or maintained[.]”15             In this case,

both the circuit court and the ICA determined that HRS § 634J-1

defined “plaintiff” so expansively that Au was a “plaintiff” for

purposes of HRS § 634J-1--even though he was the defendant in

the case--because he had, by filing the identified seven

motions, caused the litigation to be maintained.

             This court’s construction of statutes is guided by

well-settled principles.         See State v. Choy Foo, 142 Hawaiʻi 65,

72, 414 P.3d 117, 124 (2018); State v. Wheeler, 121 Hawaiʻi 383,

390, 219 P.3d 1170, 1177 (2009).            We first examine the language

of the statute itself.        Choy Foo, 142 Hawaiʻi at 72, 414 P.3d at

124.    If the language is plain and unambiguous, we must give

effect to its plain and obvious meaning.            Id.   Also, implicit in

statutory construction is our foremost obligation to ascertain

and give effect to the intention of the legislature, which is

obtained primarily from the language of the statute itself.                   Id.

Finally, when there is doubt, doubleness of meaning, or

indistinctiveness or uncertainty of an expression used in a

statute, an ambiguity exists.          Id.    When there is ambiguity, the

       15
             HRS § 634J-1 defines “Plaintiff” in full as follows:

             “Plaintiff” means the person who commences, institutes or
             maintains litigation or causes it to be commenced,
             instituted, or maintained, including an attorney at law
             acting on the attorney’s own behalf.

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meaning of ambiguous words may be sought by examining the

context or resorting to extrinsic aids to determine legislative

intent.    Citizens Against Reckless Dev. v. Zoning Bd. of

Appeals, 114 Hawaiʻi 184, 194, 159 P.3d 143, 153 (2007).

           The relevant language of HRS § 634J-1 states that

“‘plaintiff’ means the person who commences, institutes or

maintains litigation or causes it to be commenced, instituted,

or maintained[.]”     Looking solely to this language, it is not

plain or unambiguous that the term “plaintiff” refers to any

party, including a defendant, who maintains litigation by filing

motions.   Thus, the meaning of the term “plaintiff” is ambiguous

as defined by HRS § 634J-1.      It is therefore necessary to

examine the context and extrinsic aids pertaining to the statute

to determine whether the legislature intended the definition of

“plaintiff” in HRS § 634J-1 to broadly encompass parties that

maintain litigation by filing motions, as the circuit court and

the ICA determined.

           According to its legislative history, HRS chapter 634J

was enacted in order to statutorily define “vexatious litigant”

and to require plaintiffs falling within that definition to post

security in cases where the court determines that the plaintiff

is a vexatious litigant and there is no reasonable probability

that the plaintiff will prevail.         S. Stand. Comm. Rep. No. 467,

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in 1993 Senate Journal, at 978.       The chapter’s purpose was to

reduce the number of frivolous cases being filed in the court

system.     Id.    The bill was amended in the Senate “to clarify

that the definition of vexatious litigant is limited to the

plaintiff.”       Id.   Similarly, the House Standing Committee Report

recommended that the final language clarify that “a vexatious

litigant is a person and a plaintiff” due to concern that the

definition of a vexatious litigant could bar certain groups such

as environmentalists or Native Hawaiians from filing legitimate

claims.     H. Stand. Comm. Rep. No. 1178, in 1993 House Journal,

at 1473.     The legislature’s decision to limit the definition of

a vexatious litigant to plaintiffs strongly indicates the

legislature did not intend the definition of “plaintiff” to

encompass all litigants, and particularly not defendants.

             The context in which HRS § 634J-1 defines “plaintiff”

is also instructive.       State v. Yokota, 143 Hawaiʻi 200, 205, 426
P.3d 424, 429 (2018) (“[L]aws in pari materia, or upon the same

subject matter, shall be construed with reference to each

other.”).     HRS § 634J-1 defines “defendant” as “a person

(including a corporation, association, partnership, firm, or

governmental entity) against whom litigation is brought or

maintained, or sought to be brought or maintained.”           (Emphasis

added.)     The ICA concluded that a party is a “plaintiff” for

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purposes of HRS § 634J-1 if that party maintains litigation by

filing motions.16     Since the definitions of “plaintiff” and

“defendant” in HRS § 634J-1 are in pari materia, the meaning of

“maintained” in HRS § 634J-1’s definition of defendant must be

in accordance with the meaning of “maintained” in HRS § 634J-1’s

definition of “plaintiff.”       Kam v. Noh, 70 Haw. 321, 325, 770
P.2d 414, 417 (1989) (“In the absence of an express intention to

the contrary, words or phrases used in two or more sections of a

statute are presumed to be used in the same sense throughout.”).

            Thus, because a defendant is defined as one against

whom litigation is maintained, and, according to the ICA and the

circuit court, litigation can be maintained by filing motions,

then any party that files motions would become a “plaintiff” and

any party against whom a motion is filed would become a

“defendant.”    Under this interpretation, nearly all litigants

would simultaneously satisfy HRS § 634J-1’s definition of

“plaintiff” and “defendant,” eroding the distinction between

“plaintiff” and “defendant” such that either term simply means

“litigant.”    When the legislature uses different words in a

statute, however, the different words are presumed to have

different meanings.      Agustin v. Dan Ostrow Constr. Co., 64 Haw.
16
            In reaching this conclusion, the ICA relied solely on the
dictionary definition of “maintain” and did not consider the legislative
history or the context of the statute.

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80, 83, 636 P.2d 1348, 1351 (1981).         The distinction within the

statute, as well as the legislative history, therefore requires

that we give different meanings to these different words and

interpret “plaintiff” in a manner that is not so expansive as to

swallow the distinction between plaintiffs and defendants, which

the legislature explicitly sought to preserve.17

            Based on the foregoing, we hold that HRS § 634J-1’s

definition of “plaintiff” does not encompass a litigant who

maintains litigation by filing motions in the litigant’s

capacity as a defendant.18      The ICA and the circuit court erred

in ruling to the contrary.

  B. Au Also Would Not Meet the Definition of Vexatious Litigant
                        Under HRS § 634J-1(2).

            Even assuming Au had met the definition of “plaintiff”

under HRS § 634J-1, he would not qualify as a “vexatious

      17
            See also Standard Mgmt., Inc. v. Kekona, 98 Hawaiʻi 95, 105, 43
P.3d 232, 242 (App. 2001) (holding that trial court erred by expanding HRS
§ 634J-1’s definition of “plaintiff” to include plaintiffs’ counsel; stating
that, “Under HRS § 634J–1, only a plaintiff may be deemed a vexatious
litigant: ‘Vexatious litigant means a plaintiff[.]’” (alteration in
original)). The ICA in this case held that, “To the extent that
the SMI court determined that a vexatious litigant cannot be a defendant,
that determination was dicta.”
     18
            Although the ICA found that Au was a plaintiff for the purpose of
his counterclaims, only one of the motions underlying the vexatious litigant
order was filed by Au in his capacity as a counterclaimant, which
indisputably was insufficient to support the order. It is thus unnecessary
to decide whether a counterclaimant may qualify as a “plaintiff” under HRS
§ 634J-1.

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litigant” under HRS § 634J-1(2).         This subsection defines a

vexatious litigant as a plaintiff who

          [a]fter litigation has been finally resolved against the
          plaintiff, relitigates or attempts to relitigate in propria
          persona and in bad faith, either:

          (A) The validity of the determination against the same
          defendant or defendants as to whom the litigation was
          finally determined; or

          (B) The cause of action, claim, controversy, or any of the
          issues of fact or law, determined or concluded by the final
          determination against the same defendant or defendants as
          to whom the litigation was finally determined[.]

(Emphases added.)    In this case, the circuit court found that Au

was a vexatious litigant by relying on subsection (2) or, in the

alternative, subsection (3) of § 634J-1.         The ICA agreed that Au

met the above definition of a vexatious litigant under

subsection (2) and declined to consider whether Au met the

definition under subsection (3).

          Significantly, HRS § 634J-1(2) is limited in its

application to plaintiffs who attempt to relitigate issues after

they have been finally resolved.         Litigation is not finally

resolved until appellate review of the proceeding is complete or

the period in which the parties may seek review has expired.

See, e.g., Catron v. Tokio Marine Mgmt., Inc., 90 Hawaiʻi 407,

412, 978 P.2d 845, 850 (1999) (observing that the case had not

reached final resolution because appeals were pending);

Silvestrone v. Edell, 721 So. 2d 1173, 1175 n.2 (Fla. 1998)

(holding that litigation is concluded upon expiration of time of
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appeal or completion of appellate review for purposes of a

statute of limitations for legal malpractice claims).

This interpretation is consistent with the statute’s overarching

purpose of reducing the institution of frivolous cases seeking

to relitigate matters that have been finally determined.

S. Stand. Comm. Rep. No. 467, at 978.

          Here, the court’s summary judgment order did not “finally

resolve[]” the litigation against Au because either the time for

filing a notice of appeal had not expired or appellate review

had not been completed when Au filed the relevant motions.19                Au

could therefore not be deemed a vexatious litigant under HRS

§ 634J-1(2), even if he had been a “plaintiff.”           See Part IV.A.

Accordingly, the ICA erred in concluding that the circuit court

did not abuse its discretion when it determined that Au was a

vexatious litigant under HRS § 634J-1(2).

     19
            Because HRS § 634J-1(2) requires litigation to be finally
resolved, the circuit court could not rely on a presumption of the
correctness of its rulings as a basis for declaring Au a vexatious litigant
under this subsection, as stated by the ICA.

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  C. A Finding of Bad Faith Is Required in Order To Conclude a
        Litigant Is Vexatious Under HRS § 634J-1(2) or (3).

          In addition, to meet the definition of a vexatious

litigant under either HRS § 634J-1(2) or (3), the plaintiff must

have acted in bad faith.      These subsections provide that a

vexatious litigant is a plaintiff who

          (2) [a]fter litigation has been finally resolved against
          the plaintiff, relitigates or attempts to relitigate in
          propria persona and in bad faith, either: . . . ;

          (3) [i]n any litigation while acting in propria persona, files,
          in bad faith, unmeritorious motions, pleadings, or other papers,
          conducts unnecessary discovery, or engages in other tactics that
          are frivolous or solely intended to cause unnecessary delay[.]

(Emphases added.)

          The bad faith requirement was carefully considered by

the legislature when HRS chapter 634J, “Vexatious Litigants,”

was being enacted.    A House Standing Committee Report indicates

significant concern that plaintiffs would be deemed vexatious

merely for filing motions that were repetitive.

          The testimony of the [Hawaiʻi State Bar Association]
          addressed the definition of the term “repeatedly” as used
          in Paragraphs [634J]-1(2) and (3) of the new chapter
          because it might unfairly bar meritorious claims under this
          proposed legislation. The HSBA was concerned that the term
          “repeatedly” may be applied to plaintiffs who “repeatedly”
          relitigate two or three times or plaintiffs who
          “repeatedly” file motions, pleadings, or other papers that
          appear unmeritorious. It is not uncommon for litigants,
          especially those litigating pro se, to file more than one
          claim for legitimate reasons or have claims brought in
          state court to be later litigated in federal court, and
          vice versa. Moreover, it is not uncommon for plaintiffs to
          repeatedly file motions, pleadings, or other papers due to
          basic unfamiliarity with the judicial process.

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H. Stand. Comm. Rep. No. 1178, at 1473 (emphases added).            To

address this concern, the legislature specified that vexatious

litigants must have acted in bad faith.

          Your Committee, therefore, finds that the term “repeatedly”
          as used in Paragraphs [634J]-1(2) and (3) of the new
          chapter should refer to plaintiffs who relitigate in bad
          faith and who deliberately and intentionally abuse the
          system by bringing claims frivolously or causing
          unnecessary delay. The passage of this bill is not meant
          to punish litigants that are unfamiliar with the judicial
          process and are earnestly attempting to protect or preserve
          their rights. Your Committee has therefore amended this
          bill to insert the phrase “in bad faith.”

Id. (emphases added).     The legislative history of HRS chapter

634J demonstrates that the inclusion of the bad faith

requirement in HRS § 634J-1(2) and (3) was intended to limit the

definition of vexatious litigant to those plaintiffs who attempt

to relitigate in bad faith and who intentionally abuse the

system by filing frivolous claims or deliberately cause

unnecessary delay.    That is, the legislature did not intend to

punish plaintiffs who earnestly attempt to protect or preserve

their rights, even when the effort to do so involves the

repeated filing of motions that appear unmeritorious.

          In the vexatious litigant order in this case, the

circuit court found that Au had filed seven motions that sought

to relitigate the merits of the summary judgment order, and that

each of those motions had been decided adversely to Au.            The

court did not conclude orally or in the written order that any

of Au’s seven motions were frivolous, unmeritorious, or made in
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bad faith--nor was such a finding made at the time the motions

were denied by the court.      The court also did not state that it

was inferring bad faith from the totality of Au’s conduct during

the litigation.

          Despite the circuit court’s lack of findings as to bad

faith, the ICA stated that the court could infer bad faith from

Au’s insistence on relitigating the same issues in differently

titled motions.    However, allowing the court to infer bad faith

from the filing of motions that “relitgate the merits of the

issues already disposed of,” as the ICA did in this case,

effectively reads the bad faith requirement out of HRS § 634J-

1(2) and (3).   In doing so, the ICA directly contravened the

legislature’s purpose of including the requirement that the

plaintiff be found to have acted in bad faith before being

deemed vexatious under HRS § 634J-1.        H. Stand. Comm. Rep. No.

1178, at 1473 (“Paragraphs [634J]-1(2) and (3) of the new

chapter should refer to plaintiffs who relitigate in bad

faith[.]”).

          Further, the ICA’s analysis on this issue was

predicated on an incorrect interpretation of our caselaw.             In

concluding that the circuit court did not have to explicitly

find that Au acted in bad faith, the ICA stated that bad faith

does not need to be explicitly stated in a sanctioning order and

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can be inferred from conduct.       (Citing to Bank of Hawaii v.

Kunimoto, 91 Hawaiʻi 372, 390, 984 P.2d 1198, 1216 (1999).)            In

Kunimoto, however, this court held only that where the circuit

court makes findings that “are tantamount to a specific finding

of bad faith . . . . [such] findings are sufficient to enable

[an appellate] court to infer a specific finding of bad faith by

the circuit court.”     91 Hawaiʻi at 390, 984 P.2d at 1216

(emphasis added).     We did not hold that the appellate court

should scrutinize the record to determine whether it supports an

inference that the circuit court made a specific finding of bad

faith, let alone whether the record supports the making of an

inference that the circuit court could, hypothetically, have

made.   Rather, the court in Kunimoto simply stated that in cases

where the circuit court’s findings are equivalent to a finding

of bad faith, the appellate court will infer a specific finding

of bad faith by the circuit court.        Id. (holding that the

circuit court’s findings that the appellants’ conduct

constituted fraud upon the court, which was at best reckless and

at worst knowing and intentional, was tantamount to a finding of

bad faith by the court).

          Here, the circuit court’s findings that Au had filed

seven motions that sought to relitigate the merits of the

summary judgment order, and that each of those motions had been

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decided adversely to Au, are not tantamount to a finding of bad

faith.20   Cf. id.    Therefore, the ICA erred in concluding that

the circuit court could have inferred bad faith from the filing

of these motions.

           The ICA also held that the circuit court is not

obligated to make findings of fact or conclusions of law in

granting a motion to declare a plaintiff a vexatious litigant

under HRS § 634J-7.      It is well established, however, that

orders imposing sanctions should “set forth findings that

describe, with reasonable specificity, the perceived misconduct

(such as harassment or bad faith conduct), as well as the

appropriate sanctioning authority.”         Id.; see also Kawamata

Farms, Inc. v. United Agri Prods., 86 Hawai‘i 214, 257, 948 P.2d
1055, 1098 (1997); Enos v. Pac. Transfer & Warehouse, Inc., 79

Hawai‘i 452, 459, 903 P.2d 1273, 1280 (1995); Kaina v. Gellman,

119 Hawaii 324, 331, 197 P.3d 776, 783 (App. 2008) (stating that

a sanctioning order “must inform the party of the authority

pursuant to which he or she is to be sanctioned”).            The

requirement that a court should make findings that state the

perceived misconduct with reasonable specificity when sanctions

      20
            Additionally, as discussed infra Part IV.D, a review of the seven
motions that underlie the vexatious litigant order refutes the contention
that they were collectively filed in bad faith.

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are imposed has been applied in multiple situations, such as

sanctions for discovery violations, filing a complaint, and

delay in withdrawing a motion.       Fujimoto v. Au, 95 Hawaii 116,

153, 19 P.3d 699, 736 (2001) (failure to review court rule

before filing the complaint); Kawamata Farms, 86 Hawai‘i at 256,
948 P.2d at 1097 (discovery fraud); Enos, 79 Hawai‘i at 460, 903
P.2d at 1281 (undue delay in withdrawing motion).

            The making of findings regarding the purported

misconduct, including bad faith, serves multiple important

purposes.   First, it clearly identifies and explains to the

sanctioned person the conduct underlying the sanction.

Additionally, findings that describe with reasonable

particularity the perceived misconduct facilitate a meaningful

and more efficient appellate review.        Kunimoto, 91 Hawai‘i at

390, 984 P.2d at 1216.     Specifying the sanctioning authority,

including the court’s inherent authority if applicable, is also

necessary for meaningful appellate review.         Kaina, 119 Hawaii at

331, 197 P.3d at 783.     Finally, the findings assure both the

litigants and the court that the decision to impose sanctions

was the result of reasoned consideration.         See Enos, 79 Hawai‘i

at 459, 903 P.2d at 1280 (stating that specific findings assure

litigants and the judge that the decision was the product of

thoughtful deliberation).
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           A prefiling order preventing the litigant from filing

any new litigation, or an order during litigation that prohibits

the filing of documents without leave of the court, is

indisputably a sanction on that litigant.          See Black’s Law

Dictionary 1608 (11th ed. 2019) (defining “sanction” as “a

provision that gives force to a legal imperative by either

rewarding obedience or punishing disobedience”).            Requiring

trial courts to make findings of fact when declaring a plaintiff

a vexatious litigant is also warranted by the fact that such

determination under HRS chapter 634J, unlike monetary sanctions,

continues to affect the litigant in future litigation and

impairs the litigant’s right to access the judicial system.

Thus, we hold that a court imposing a vexatious litigant order

under HRS chapter 634J is required to make findings that set

forth, with reasonable specificity, the perceived misconduct,

including a finding of bad faith when applicable, and the

authority under which the sanction is imposed.21           Cf. Kunimoto,

     21
            In concluding that the circuit court was not required to make any
specific findings of fact, the ICA relied on HRCP Rule 52. HRCP Rule 52, the
ICA observed, provides that “findings of fact and conclusions of law are
unnecessary on decisions of motions under Rules 12 or 56 or any other motion”
unless the motion concerns amendment of a judgment or judgment on partial
findings. However, our cases establish the importance of setting forth
findings of fact in a sanctioning order, regardless of the authority under
which the sanctions are imposed.

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91 Hawaii at 390, 984 P.2d at 1216; Kaina, 119 Hawaii at 331,
197 P.3d at 783.

          The circuit court’s order declaring Au a vexatious

litigant under HRS § 634J-1(2) or (3) was therefore additionally

deficient because it failed to specify the perceived misconduct

that constituted bad faith and the court’s findings were not

tantamount to a finding of bad faith.        Accordingly, the ICA

erred in affirming the circuit court’s order on this basis also.

     D. The Record Does Not Support a Finding of Bad Faith.

          The circuit court concluded that Au was a vexatious

litigant because he filed seven motions that sought to

relitigate the merits of the summary judgment order and each of

those motions was decided adversely to Au.         In affirming the

circuit court, the ICA determined that Au met the definition of

a vexatious litigant because, through the seven motions, he

“continued to relitigate or attempt to relitigate issues of law

or fact finally determined against him” in bad faith.            A close

review of the seven motions underlying the vexatious litigant

order demonstrates that they do not support the ICA’s inference

that Au sought to relitigate the merits of the summary judgment

order in bad faith.

          Au’s motion for reconsideration was the first motion

underlying the vexatious litigant order.         In this motion, Au

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argued that the circuit court did not duly consider the

contentions in the counterclaim, particularly his argument that

he was the subject of a retaliatory eviction, before granting

summary judgment for Bishop Estate.        Bishop Estate maintained

that Au waived this argument by not including it in his

opposition.   In denying the motion, the court stated only that

its decision was based on its review of the record and for good

cause.

          In the second motion identified, the Rule 60(b) motion

to vacate, Au contended that the $62,000 owed to Bishop under

the settlement agreement was incorrectly calculated.            Bishop

Estate argued that Au waived this argument by failing to raise

it in an earlier proceeding.      The court’s order denying this

motion stated that its decision was based on the untimeliness of

the motion, the unreliability of Au’s proffered calculations,

and Au’s waiver of the argument by not raising it in his

opposition to Bishop Estate’s motion for summary judgment.

          Au’s renewed motion to vacate the summary judgment

order, the third motion, sought to correct a deficiency in his

motion to vacate that the court had identified, namely the

unreliability of his calculations, by proffering a declaration

from his accountant.

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            The fourth motion, Au’s motion to reconsider CCSJ

order, was filed when the third motion was pending.           Au filed

this motion apparently on the premise that the court might

credit the new evidence in his renewed motion to vacate.              Since

the circuit court had considered, at least in part, the merits

of the Rule 60(b) motion to vacate in determining that Au’s

calculations were unreliable, Au’s motion to reconsider CCSJ

order also sought to preserve his challenge to the counterclaim

summary judgment order based upon his submission of the new

evidence.

            The fifth motion identified was Au’s motion to vacate

final judgment, which sought this relief because the final

judgment had been entered while Au’s renewed motion to vacate

and the motion to reconsider CCSJ order were pending.            Au

contended that the premature entry of the final judgment would

result in his notice of appeal being dismissed as premature.

The motion was clearly an effort to ensure that issues were

preserved for appeal by addressing the sequence of events

involving the timing of the entry of the final judgment.

            Au’s motion for correction, the sixth motion, was

filed prior to the court’s denial of his motion to vacate final

judgment.   In this motion, Au asked the court to vacate the

final judgment and prepare a new final judgment so that he could

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properly seek appeal of the court’s denial of his motion to

reconsider CCSJ order.     As with the motion to vacate final

judgment, Au was attempting to preserve his right to appeal an

adverse order.    This motion was withdrawn at the hearing prior

to its disposition.

          Finally, the seventh motion was Au’s motion to stay.

In this motion, Au argued that enforcement of the judgment

should be stayed pending the determination of a supersedeas

bond.   Au maintained that the amount of the supersedeas bond

should not be set by the amount stated in the final judgment

because certain attorneys’ fees were erroneously awarded and

because of the pending appeal of the court’s rejection of his

argument that the amount owed under the settlement agreement was

incorrectly calculated.     The court ultimately denied Au’s motion

because it found his proffered alternative security, a lien on

certain real property, was an inadequate substitute for a

supersedeas bond.

          In each of the motions, Au presented arguments that

were not demonstrably in bad faith or even frivolous.            Indeed,

the circuit court made no such finding on any of the motions.

Although Au did include the rejected argument that the

settlement agreement was based on an incorrect calculation in

several of his motions, the mere inclusion of an apparently

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unmeritorious argument within a motion asserting other grounds

for relief does not establish that the motion was made in bad

faith, or was done with the deliberate intent to delay the

proceedings.    See H. Stand. Comm. Rep. No. 1178, at 1473.            As

the legislature noted, HRS chapter 634J is not meant to punish

litigants that are earnestly attempting to protect or preserve

their rights.22    Id.

            Considering the seven motions both separately and

together, the record does not support a finding that Au sought

to relitigate the merits of the summary judgment order in bad

faith.

                             V.   CONCLUSION

            For the foregoing reasons, the ICA’s July 26, 2019

judgment on appeal and the circuit court’s vexatious litigant

order are reversed.

Ronald G.S. Au                            /s/ Mark E. Recktenwald
petitioner pro se
                                          /s/ Paula A. Nakayama
Dennis W. Chong Kee
                                          /s/ Sabrina S. McKenna
Christopher T. Goodin
for respondents                           /s/ Richard W. Pollack
                                          /s/ Michael D. Wilson

     22
            Although a defendant who files a frivolous motion is not subject
to the vexatious litigant statute, defendants, including self-represented
defendants, are subject to HRCP Rule 11 and may be sanctioned under its
provisions in appropriate circumstances. See HRCP Rule 11(c).

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