Court Opinion

ID: 9906020
Source: CourtListenerOpinion
Date Created: 2023-11-30 19:03:12.728077+00
Date Added: 2024-06-11T09:24:04.280660
License: Public Domain

NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

                                                 Electronically Filed
                                                 Intermediate Court of Appeals
                                                 CAAP-XX-XXXXXXX
                                                 30-NOV-2023
                                                 08:03 AM
                                                 Dkt. 166 SO

                          NO. CAAP-XX-XXXXXXX

                IN THE INTERMEDIATE COURT OF APPEALS

                        OF THE STATE OF HAWAI#I

        JAWMIN L.L.C., a Hawaii limited liability company,
                        Plaintiff/Appellant,
                                 v.
     HOKUKANO RANCH, INC., a Hawaii corporation; THOMAS PACE;
    KEALAKEKUA HERITAGE RANCH, LLC, a Hawaii limited liability
   company; PACIFIC MAKAI PROPERTY MANAGEMENT LLC, a California
limited liability company; HOKUKANO FOREST PARTNERS LLC, a Hawaii
         limited liability company, Defendants/Appellees,
                   and MARY GREENWELL, Defendant

         APPEAL FROM THE CIRCUIT COURT OF THE THIRD CIRCUIT
                      (CIVIL NO. 3CC17100171K)

                     SUMMARY DISPOSITION ORDER
  (By:   Hiraoka, Presiding Judge, Wadsworth and McCullen, JJ.)

           Jawmin L.L.C. appeals from the Second Amended Final
Judgment in favor of Thomas Pace, Hokukano Ranch, Inc.,
Kealakekua Heritage Ranch, LLC, Pacific Makai Property
Management, LLC, and Hokukano Forest Partners LLC, entered by the
Circuit Court of the Third Circuit on March 18, 2020.1 We affirm
in part, vacate in part, and remand for further proceedings.

     1
           The Honorable Melvin H. Fujino presided.
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                                 BACKGROUND

           Jawmin owns real property in Kealakekua on the island
of Hawai#i. Heritage Ranch, Pacific Makai, and Hokukano Forest
own real property sharing common boundaries with Jawmin's
property.
           On May 17, 2017, Jawmin sued Heritage Ranch, Pacific
Makai, Hokukano Forest, Pace, and Hokukano Ranch.2 Jawmin
alleged that animals owned by Pace and Hokukano Ranch trespass
onto Jawmin's property "and cause tremendous damage by breaking
fences, natural barriers, and equipment, and eating many of the
new seedlings that are vital to [its tree cultivation] business."
Hokukano Ranch doesn't share a common boundary with Jawmin; its
animals allegedly get onto Jawmin's property by going through
Heritage Ranch's property. The complaint contained seven counts:
(1) violation of Hawaii Revised Statutes (HRS) § 142-64 by
Hokukano Ranch and Pace; (2) negligence against Hokukano Ranch
and Pace; (3) trespass against Hokukano Ranch and Pace;
(4) punitive damages against Hokukano Ranch and Pace;
(5) petition for a fence under HRS Chapter 664 against all
defendants; (6) declaratory judgment against Hokukano Ranch and
Pace; and (7) injunctive relief against Hokukano Ranch and Pace.
          Pace, Hokukano Ranch, Hokukano Forest, and Heritage
Ranch moved for partial summary judgment on Jawmin's HRS
Chapter 664 fence petition, and separately moved for partial
summary judgment on Jawmin's claims for damages. Pace moved for
summary judgment on all claims. The circuit court granted those
motions.
          Jawmin moved for partial summary judgment on its HRS
Chapter 664 fence petition and declaratory judgment claims. The
circuit court denied the motion.
          The parties stipulated to dismiss Jawmin's claims for
declaratory and injunctive relief.

      2
            Mary Greenwell was also named as a defendant.   She was dismissed
by stipulation.

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          The circuit court entered a judgment. Jawmin appealed.
The circuit court awarded costs to Pace, Hokukano Ranch, Hokukano
Forest, and Heritage Ranch. We remanded for the circuit court to
enter an amended judgment. The circuit court entered an amended
judgment. We remanded for the circuit court to enter another
amended judgment. The circuit court entered the Second Amended
Final Judgment, which disposed of all claims by and against all
parties and awarded costs to Pace, Hokukano Ranch, Hokukano
Forest, and Heritage Ranch.3

                                 DISCUSSION

          Jawmin contends that the circuit court erred by:
(1) denying its motion for partial summary judgment and granting
the defendants' motion for partial summary judgment on the HRS
Chapter 664 fence petition; (2) granting the defendants' motion
for partial summary judgment on Jawmin's claim for damages;
(3) granting Pace's motion for summary judgment; and (4) awarding
costs to Pace, Hokukano Ranch, Hokukano Forest, and Heritage
Ranch.

            (1)   The circuit court did not err by granting partial
summary judgment on Jawmin's HRS Chapter 664 fence petition. We
review a circuit court's grant or denial of summary judgment de
novo using the same standard applied by the circuit court.
Nozawa v. Operating Engineers Local Union No. 3, 142 Hawai#i 331,
338, 418 P.3d 1187, 1194 (2018). We "may affirm a grant of
summary judgment on any ground appearing in the record, even if
the circuit court did not rely on it." Reyes v. Kuboyama, 76
Hawai#i 137, 140, 870 P.2d 1281, 1284 (1994) (citations omitted);
see also State v. Taniguchi, 72 Haw. 235, 239, 815 P.2d 24, 26
(1991) ("[W]e have consistently held that where the decision

      3
            Pacific Makai doesn't appear to have filed its own dispositive
motion or substantive joinders in the other defendants' motions.
Nevertheless, judgment was entered in its favor and against Jawmin.

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below is correct it must be affirmed by the appellate court even
though the lower tribunal gave the wrong reason for its action."
(citation omitted)).
          Summary judgment is appropriate if there is no genuine
issue of material fact and the moving party is entitled to a
judgment as a matter of law. Nozawa, 142 Hawai#i at 342, 418
P.3d at 1198. A fact is material if proof of that fact would
establish or refute an essential element of a cause of action or
defense. Id. The evidence must be viewed in the light most
favorable to the non-moving party. Id.
          HRS § 664-21 (2016) allows a landowner who desires to
fence their land or, having fenced the land, desires to provide
for fence maintenance, to petition a circuit court. The petition
must

          designate the land by name or description, the location
          thereof, and the boundary or boundaries desired to be fenced
          or the fence desired to be maintained; and shall designate
          the adjoining land or lands and state the name or names of
          the owners, lessees, and occupants thereof.

HRS § 664-21(b) (emphasis added).

          When the desired fence is intended for the purpose of
          confining animals of each adjacent owner . . . in their
          respective lands, the court shall decide equitably on the
          kind of fence to be built or maintained, to the end that
          trespass shall be prevented and that injury or damage to
          either party shall be reduced to the very minimum, and the
          portion or portions to be erected or maintained by either
          the respective land owners or any of the occupants or
          lessees of the particular parcels of land affected, insofar
          as their respective interests are concerned, or the share
          which each shall contribute to the cost thereof.

HRS § 664-23(b) (2016) (emphasis added).
          The parties argue about whether use of the words
adjoining and adjacent make HRS §§ 664-21 and 664-23 ambiguous;
whether the definitions in Black's Law Dictionary or in Merriam-
Webster's Unabridged Dictionary should be applied; whether the
statutes should or must be read in pari materia with HRS § 142-

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644 under HRS § 1-165; and whether Jawmin's statutory
interpretation would lead to absurd results. See State v. Moon,
152 Hawai#i 195, 209, 524 P.3d 1219, 1233 (2023) ("If a literal
construction of statutory language would produce an absurd
result, we presume that result was not intended and construe the
statute in accord with its underlying legislative intent."
(citation omitted)). None of those arguments are dispositive.
           Interpretation of a statute is a question of law
reviewed de novo. Barker v. Young, 153 Hawai#i 144, 148, 528
P.3d 217, 221 (2023). We start with the statute's language;
"implicit in the task of statutory construction is our foremost
obligation to ascertain and give effect to the intention of the
legislature, which is to be obtained primarily from the language
contained in the statute itself." Id. (citation omitted).
          According to Jawmin's complaint, the fence it wants is
to be "erected along the entirety of its western and southern
boundaries[.]" There is no dispute that: (a) Hokukano Ranch owns
at least some of the trespassing animals; (b) Hokukano Ranch's
property and Jawmin's property don't share a common boundary;
(c) the properties owned by Hokukano Forest, Heritage Ranch, and
Pacific Makai share common boundaries with Jawmin's property; but
(d) Hokukano Forest, Heritage Ranch, and Pacific Makai don't own
the trespassing animals.

     4
          HRS § 142-64 (2011) provides:
          If any [cattle, horse, mule, ass, swine, sheep, or goat]
          trespasses on any unfenced cultivated ground, the owner
          thereof shall pay upon proof, the full amount of the damage
          or loss to the landowner or to any person in possession of
          the land, whoever suffers the damage or loss.
     5
          HRS § 1-16 (2009) provides:
          Laws in pari materia, or upon the same subject matter, shall
          be construed with reference to each other. What is clear in
          one statute may be called in aid to explain what is doubtful
          in another.

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          By its terms, HRS § 664-23 applies when "the desired
fence is intended for the purpose of confining animals of each
adjacent owner . . . in their respective lands" (emphasis added).
The fence Jawmin wants (along its western and southern
boundaries) would confine Jawmin's animals (if it owned any) to
Jawmin's land. But it wouldn't confine Hokukano Ranch's animals
to Hokukano Ranch's land; the animals could still go onto land
owned by Hokukano Forest, Heritage Ranch, and Pacific Makai.
Hokukano Forest, Heritage Ranch, and Pacific Makai own no animals
for a fence to confine; Jawmin made no argument about why those
defendants should have to build or maintain a fence along their
common property boundaries.
          HRS §§ 664-21 and 664-23 have no application to the
undisputed facts of this case. The circuit court did not err by
granting the defendants' motion for partial summary judgment and
denying Jawmin's motion for partial summary judgment on Jawmin's
HRS Chapter 664 petition.

            (2)   The circuit court erred in part by granting the
motion for partial summary judgment on damages filed by Pace,
Hokukano Ranch, Hokukano Forest, and Heritage Ranch. It isn't
clear why Hokukano Forest and Heritage Ranch were included as
movants, because Jawmin's claims for damages were asserted
against Hokukano Ranch and Pace only.
          Jawmin's claims for damages were based on HRS § 142-64
and tort theories of negligence and trespass.6 The motion argued
that (a) Jawmin did not mitigate its damages, (b) Jawmin's claims
for damages were barred by laches, and (c) Jawmin's claims for
damages incurred before May 17, 2015, (two years before Jawmin
filed its complaint) were barred by the statute of limitations.

      6
             Jawmin's complaint alleged a cause of action for punitive damages,
but a claim for punitive damages isn't an independent tort; it is purely
incidental to a separate cause of action. Ross v. Stouffer Hotel Co. (Haw.),
76 Hawai#i 454, 466, 879 P.2d 1037, 1049 (1994).

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Jawmin's memorandum in opposition addressed each argument. The
circuit court based its decision on the doctrine of laches,7 so
that is the only issue we will discuss.
          In Hawai#i laches applies to both legal and equitable
claims. Ass'n of Apt. Owners of Royal Aloha v. Certified Mgmt.,
Inc., 139 Hawai#i 229, 235-36, 386 P.3d 866, 872-73 (2016). A
defendant asserting a laches defense must prove two things:
(1) the plaintiff unreasonably delayed bringing their claim under
the circumstances; and (2) the delay prejudiced the defendant.
HawaiiUSA Fed. Credit Union v. Monalim, 147 Hawai#i 33, 42, 464
P.3d 821, 830 (2020).
          For the first prong, "[l]apse of time alone does not
constitute laches. Since laches is an equitable defense, its
application is controlled by equitable considerations." Pelosi
v. Wailea Ranch Ests., 91 Hawai#i 478, 491, 985 P.2d 1045, 1058
(1999) (cleaned up). Jawmin acquired its property in 2010 and
claimed to have "had repeated conversations with the Hokukano
Defendants and sent numerous emails and letters" about Hokukano
Ranch's trespassing animals starting in 2010. Jawmin's lawsuit
wasn't filed until 2017. Jawmin's interrogatory answers stated
that "Defendant Pace and other representatives of Hokukano
Defendants repeatedly stated that they would address the issue
[of the trespassing animals], often assuring that they had
ordered the materials to build a fence." "After years of
inaction by the Hokukano Defendants, [Jawmin]'s counsel sent a
series of letters (dated April 7, 2017, May 31, 2017, and
August 28, 2017) to Hokukano Defendants requesting the removal of
the Trespassing Animals and that remedial action commence

     7
            The circuit court orally ruled: "I would find under the doctrine
of laches that the defendants are prejudiced so the Court will grant those
[sic] motion as on that basis." The order granting the motion stated:
"Plaintiff's claims for damages against Defendants . . . are barred in their
entirety by the doctrine of laches. As the Court grants Defendants' Motion on
the basis of laches, this Order does not address either of Defendants'
alternative grounds[.]"

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immediately." Viewed in the light most favorable to Jawmin, the
evidence shows a genuine issue of material fact about whether
Jawmin's delay in filing suit was reasonably induced by Hokukano
Ranch's and Pace's alleged repeated promises to address the
trespassing animal issue and to build a fence.
          For the second prong, "[w]hat qualifies as prejudice
for purposes of the laches doctrine invariably depends on the
facts and circumstances of a particular case, but it is
ordinarily understood as anything that places the defendant in a
less favorable position." Monalim, 147 Hawai#i at 42, 464 P.3d
at 830 (cleaned up). Hokukano Ranch and Pace argued that
evidence about alleged damages to Jawmin's "prior forestry
operations" has been lost, and "memories have faded." However,
Hokukano Ranch and Pace acknowledge that evidence from Jawmin's
bankruptcy case (filed in 2010), a 2014 report by Tom Baribault,
Ph.D., and a 2017 report by R.S. Senock, Ph.D. support its
defenses to Jawmin's damage claims. There was a genuine issue of
material fact whether Jawmin's delay in filing suit actually
prejudiced Hokukano Ranch or Pace and, if so, to what extent.
The record indicates that the delay — and resultant loss of
potential evidence — could actually have prejudiced Jawmin's
ability to prove damages. We conclude that the circuit court
erred by granting summary judgment to Hokukano Ranch and Pace
based on laches.

          (3)   The circuit court erred in part by granting Pace's
motion for summary judgment. Pace's motion argued that (a) he
didn't own the animals that allegedly trespassed on Jawmin's
property, and (b) Hokukano Ranch wasn't his alter ego. There
were genuine issues of material fact about whether Pace
negligently oversaw Hokukano Ranch's operations, and whether
Pace's alleged negligence caused damage to Jawmin's property.
However, the circuit court did not err by granting partial
summary judgment on Jawmin's theory of alter ego liability,

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because Jawmin did not offer evidence to support its claim that
Hokukano Ranch was Pace's alter ego.
          (a) Pace stated that he owned no animals kept on
Hokukano Ranch property, and owned no livestock in Hawai#i.
Jawmin offered Pace's deposition testimony that he "oversees the
ranching operations" of Hokukano Ranch and was aware that
Hokukano Ranch's "animals sometimes wander onto lots now owned by
other people" including Jawmin. An officer, director,
shareholder, manager, or employee of a corporation can be
personally liable for the corporation's tortious conduct if there
was "active or passive participation" in the tortious conduct.
Cahill v. Hawaiian Paradise Park Corp., 56 Haw. 522, 526, 543
P.2d 1356, 1360 (1975); E. Star, Inc., S.A. v. Union Bldg.
Materials Corp., 6 Haw. App. 125, 134-35, 712 P.2d 1148, 1155
(1985); see also Burgess v. Arita, 5 Haw. App. 581, 594, 704 P.2d
930, 939 (1985) (holding that corporate officers or directors who
participate in tortious conduct aren't shielded by the
corporation and will be personally liable). Viewed in the light
most favorable to Jawmin, there was a genuine issue of material
fact about whether Pace negligently oversaw Hokukano Ranch's
operations by letting Hokukano Ranch's animals trespass on, and
cause damage to, Jawmin's property. The circuit court erred by
granting partial summary judgment for Pace on Jawmin's claims of
negligence and trespass.
          (b) But the circuit court did not err by granting
partial summary judgment for Pace on Jawmin's HRS § 142-64 claim.
The statute applies only to owners of trespassing animals.
Jawmin offered no evidence that Pace owned the allegedly
trespassing animals.
          Jawmin's alternate theory of liability against Pace was
based on Hokukano Ranch being Pace's alter ego.

          A claim based on the alter ego theory is not in itself
          a claim for substantive relief, but rather to
          disregard the corporation as a distinct defendant is

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           procedural.[8] A finding of fact of alter ego . . .
           furnishes a means for a complainant to reach a[n]
           . . . individual upon a cause of action that otherwise
           would have existed only against the . . . corporation.
           . . . One who seeks to disregard the corporate veil
           must show that the corporate form has been abused to
           the injury of a third person.

           Courts apply the alter ego doctrine with great caution and
           reluctance. In fact, many courts require exceptional
           circumstances before disregarding the corporate form.

Robert's Haw. Sch. Bus, Inc. v. Laupahoehoe Transp. Co., 91
Hawai#i 224, 241, 982 P.2d 853, 870 (1999) (citation omitted),
superseded on other grounds by statute as noted in Haw. Med.
Ass'n v. Haw. Med. Serv. Ass'n, Inc., 113 Hawai#i 77, 107, 148
P.3d 1179, 1209 (2006).
           Many factors can be considered to determine whether a
corporation is the alter ego of a person, and no single factor is
dispositive. Calipjo v. Purdy, 144 Hawai#i 266, 277 & n.23, 439
P.3d 218, 229 & n.23 (2019) (listing 25 factors to consider in
determining whether a corporation is the alter ego of a person).
But a two-part test must be satisfied:

           It must be made to appear that [1] the corporation is not
           only influenced and governed by that person, but that there
           is such a unity of interest that the individuality, or
           separateness, of such person and corporation has ceased, and
           [2] that the facts are such that an adherence to the fiction
           of the separate existence of the corporation would, under
           the particular circumstances, sanction a fraud or promote
           injustice.

Id. at 277, 439 P.3d at 229 (cleaned up) (emphasis added).
          Jawmin's memorandum opposing Pace's motion listed
several facts it contended "clearly show that [Jawmin]'s claims
of Pace's personal liability are grounded in the Robert's Hawaii
factors[.]"    However, even viewed in the light most favorable to

     8
            Pace argues that Jawmin failed to plead an alter ego theory of
liability. Hawai#i is a notice pleading jurisdiction; it wasn't necessary for
Jawmin's complaint to "plead legal theories with precision." Bank of Am.,
N.A. v. Reyes-Toledo, 143 Hawai#i 249, 259, 428 P.3d 761, 771 (2018) (cleaned
up).

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Jawmin, there is no evidence showing that Hokukano Ranch's
"corporate form has been abused to the injury of" Jawmin,
Robert's Haw., 91 Hawai#i at 241, 982 P.2d at 870 (emphasis
omitted), or that failing to recognize that Hokukano Ranch was
Pace's alter ego would "sanction a fraud or promote injustice[,]"
Calipjo, 144 Hawai#i at 277, 439 P.3d at 229 (citation omitted).
Jawmin presented no evidence that, for example, Hokukano Ranch
was undercapitalized or would otherwise be unable to satisfy a
judgment for damages because of acts or omissions by Pace. We
conclude that the circuit court did not err by granting partial
summary judgment for Pace on Jawmin's theory of alter ego
liability.

          (4)   The circuit court erred by awarding costs to Pace,
Hokukano Ranch, Hokukano Forest, and Heritage Ranch in a lump
sum. Those defendants sought to recover their costs as
prevailing parties, under Hawai#i Rules of Civil Procedure Rule
54(d). But only Hokukano Forest and Heritage Ranch are
prevailing parties. We vacate the unapportioned award of costs.

                             CONCLUSION

          For these reasons, the Second Amended Final Judgment is
affirmed as to Kealakekua Heritage Ranch, LLC, Pacific Makai
Property Management, LLC, and Hokukano Forest Partners LLC, but
vacated as to Thomas Pace and Hokukano Ranch, Inc. The partial
summary judgment on count 1 (HRS § 142-64) is affirmed as to
Thomas Pace but vacated as to Hokukano Ranch, Inc. The partial
summary judgments on counts 2 through 4 are vacated as to Pace
and Hokukano Ranch. The partial summary judgment on count 5 (HRS
Chapter 664) is affirmed (counts 6 and 7 were dismissed by
stipulation). This case is remanded to the circuit court for

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further proceedings consistent with this summary disposition
order.
          DATED: Honolulu, Hawai#i, November 30, 2023.

On the briefs:
                                       /s/ Keith K. Hiraoka
Leroy E. Colombe,                      Presiding Judge
Winston I. Wong,
for Plaintiff/Appellant.               /s/ Clyde J. Wadsworth
                                       Associate Judge
William M. Harstad,
Derek B. Simon,                    /s/ Sonja M.P. McCullen
Erika S. Gustin,                   Associate Judge
for Defendants/Appellees
Hokukano Ranch, Inc., Thomas
Pace, Kealakekua Heritage Ranch, LLC,
and Hokukano Forest Partners LLC.

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