Court Opinion

ID: 5129515
Source: CourtListenerOpinion
Date Created: 2021-11-25 00:03:09.271784+00
Date Added: 2024-06-11T08:23:12.349045
License: Public Domain

NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

                                                  Electronically Filed
                                                  Intermediate Court of Appeals
                                                  CAAP-XX-XXXXXXX
                                                  24-NOV-2021
                                                  07:49 AM
                                                  Dkt. 62 SO

                           NO. CAAP-XX-XXXXXXX

                  IN THE INTERMEDIATE COURT OF APPEALS

                         OF THE STATE OF HAWAI#I

   U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE FOR MASTR ASSET
    BACKED SECURITIES TRUST, 2006-FRE2, Plaintiff-Appellee,
                                v.
             EARL KYOJI OMIZO, Defendant-Appellant,
                               and
               JOHN and MARY DOES 1-10, Defendants

          APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT
                       (CIVIL NO. 1CC121000219)

                        SUMMARY DISPOSITION ORDER
         (By:   Ginoza, Chief Judge, Leonard and Hiraoka, JJ.)

            Defendant-Appellant Earl Kyoji Omizo appeals from the
Judgment in favor of Plaintiff-Appellee U.S. Bank NA entered by
the Circuit Court of the First Circuit on June 18, 2019.1 For
the reasons explained below, we affirm the Judgment.
          Bank filed an amended complaint against Omizo on
August 26, 2016. The amended complaint alleged that Bank had
completed a nonjudicial foreclosure on property owned by Omizo.
Bank was the high bidder at the foreclosure auction. Bank
recorded an affidavit of foreclosure and a deed transferring
title to the property to itself. Omizo continued to remain on
the property. Count I sought a writ of ejectment. Count II
sought recovery of damages for Omizo's continuing occupancy of

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            The Honorable Jeannette H. Castagnetti presided.
  NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

the property. Count III alleged that if the court determined the
nonjudicial foreclosure was invalid:

          the non-judicial foreclosure may be set aside; that the
          Mortgage shall be deemed to still be a valid and existing
          lien against the Property, with the same priority, force and
          affect, as if it had not been foreclosed by the non-judicial
          foreclosure; and that [Bank] may be entitled to proceed with
          a judicial foreclosure.

Omizo answered the amended complaint; he did not assert a
counterclaim against Bank.
          Bank filed a motion for summary judgment on April 24,
2018. Omizo's opposition was filed on May 22, 2018. He argued
that the nonjudicial foreclosure was void because Bank failed to
publish notice of rescheduling the foreclosure auction, as
required by Hungate v. Law Off. of David B. Rosen, 139 Hawai#i
394, 403-04, 391 P.3d 1, 10-11 (2017). He did not argue that
Bank had lacked standing to nonjudicially foreclose his mortgage.
Bank filed a reply memorandum on May 24, 2018.
          Bank's motion was heard on May 30, 2018. Bank offered
to "stipulate to the fact that the nonjudicial foreclosure is
invalid, and that the mortgage be reinstated." In response to
the circuit court's questions, Bank's counsel clarified:

                But we're not asking for an adjudication ruling of the
          Court. We're just saying if the Court's going to deny the
          writ [of ejectment], due to the fact that the nonjudicial
          foreclosure was invalid under the Hungate case, then it just
          revests title back into the borrowers, and put the mortgage
          back on title, on -- as a lien against the property.

                And at that point, Your Honor, we may or may not file
          a foreclosure action. I mean, it just depends too if we're
          going to try to settle this matter. But at least
          everything's brought back to status quo, based on the fact
          that the nonjudicial foreclosure was invalid under of [sic]
          the Hungate case, Your Honor.

The circuit court took the motion under advisement, pending
settlement discussions between the parties.
          A year passed without a settlement. On June 18, 2019,
the circuit court entered findings of fact, conclusions of law,
and an order granting in part and denying in part Bank's motion.

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

The circuit court concluded that Bank's nonjudicial foreclosure
was void under Kondaur Cap. Corp. v. Matsuyoshi, 136 Hawai#i 227,
361 P.3d 454 (2015) and Hungate. The circuit court denied the
motion "with respect to Counts I [ejectment] and II [damages]" of
Bank's amended complaint. On Count III, the circuit court
granted the following declaratory relief:

          A.   The non-judicial foreclosure as evidenced by the
               Mortgagee's Affidavit of Foreclosure Sale Under Power
               of Sale recorded in the Bureau of Conveyances of the
               State of Hawaii on December 30, 2010 as Document
               No. 2010-203923 is void;

          B.   The title of the Property shall be restored in the
               name of EARL KYOJI OMIZO;

          C.   The Mortgage dated December 30, 2005 and recorded in
               the Bureau of Conveyances of the State of Hawaii as
               Document No. 2005-266361 shall be reinstated under the
               same terms, conditions, and priority as it was prior
               to the non-judicial foreclosure;
          D.   [Bank] may be entitled to proceed with a judicial
               foreclosure; and
          E.   This Order is entered as a final judgment pursuant to
               Rule 54 (b) of the Hawaii Rules of Civil Procedure as
               there is no reason for delay.

Also on June 18, 2019, the circuit court entered the Judgment in
favor of Bank as to Count III (declaratory relief), as required
by Rule 58 of the Hawai#i Rules of Civil Procedure (HRCP); the
Judgment contained the language required by HRCP Rule 54(b).
This appeal followed.
          Omizo's sole contention on appeal is that "[t]he
Circuit Court committed reversible error in granting summary
judgment, because [Bank] failed to establish its standing."
Omizo's contention lacks merit. He cites Bank of Am. v.
Reyes-Toledo, 139 Hawai#i 361, 370, 390 P.3d 1248, 1257 (2017),
for the proposition that a plaintiff seeking summary judgment in
a foreclosure action has the burden to establish standing to
enforce the note and mortgage at the time the complaint was
filed. But Count III of Bank's amended complaint did not seek
foreclosure. It sought declaratory relief. The circuit court's
HRCP Rule 54(b)-certified judgment granted declaratory relief,

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

not a decree of foreclosure.     A party has standing to seek
declaratory relief:

          (1) where antagonistic claims exist between the parties
          (a) that indicate imminent and inevitable litigation, or
          (b) where the party seeking declaratory relief has a
          concrete interest in a legal relation, status, right, or
          privilege that is challenged or denied by the other party,
          who has or asserts a concrete interest in the same legal
          relation, status, right, or privilege; and (2) a declaratory
          judgment will serve to terminate the uncertainty or
          controversy giving rise to the proceeding.

Tax Found. of Hawai#i v. State, 144 Hawai#i 175, 202, 439 P.3d
127, 154 (2019). The record reflects that Bank had standing to
request declaratory relief against Omizo about the legal
consequences of its invalid nonjudicial foreclosure.
          For the foregoing reasons, the Judgment entered by the
circuit court on June 18, 2019, is affirmed.
          DATED: Honolulu, Hawai#i, November 24, 2021.

On the briefs:
                                        /s/ Lisa M. Ginoza
Gary V. Dubin,                          Chief Judge
Frederick J. Arensmeyer,
for Defendant-Appellant.                /s/ Katherine G. Leonard
                                        Associate Judge
Edmund K. Saffery,
Deirdre Marie-Iha,                      /s/ Keith K. Hiraoka
Lauren K. Chun,                         Associate Judge
for Plaintiff-Appellee.

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