Court Opinion

ID: 2794087
Source: CourtListenerOpinion
Date Created: 2015-04-15 21:03:11.730298+00
Date Added: 2024-06-11T11:15:21.930192
License: Public Domain

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                                                              Electronically Filed
                                                              Supreme Court
                                                              SCWC-12-0000266
                                                              15-APR-2015
                                                              08:39 AM

            IN THE SUPREME COURT OF THE STATE OF HAWAI#I

                                ---o0o---

        MARK C. KELLBERG, Respondent/Plaintiff-Appellant,

                                    vs.

        CHRISTOPHER J. YUEN, in his capacity as Planning
       Director, County of Hawai#i, and COUNTY OF HAWAI#I,
                Petitioners/Defendants-Appellees.

                             SCWC-12-0000266

         CERTIORARI TO THE INTERMEDIATE COURT OF APPEALS
               (CAAP-12-0000266; CIV. NO. 07-1-157)

                             APRIL 15, 2015

   RECKTENWALD, C.J., NAKAYAMA, McKENNA, AND POLLACK, JJ., AND
     CIRCUIT JUDGE GARIBALDI, IN PLACE OF WILSON, J., RECUSED

             OPINION OF THE COURT BY RECKTENWALD, C.J.

           This appeal requires us to consider the circumstances

under which a court must consider ordering the joinder of unnamed

parties under Rule 19 of the Hawai#i Rules of Civil Procedure
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(HRCP).

           A dispute arose when the Planning Director of the

County of Hawai#i (Planning Director) approved the application of

Michael Pruglo to consolidate and resubdivide the pre-existing

lots on his 49-acre parcel of land in Ninole, Hawai#i (Subject

Property).   Respondent/plaintiff-appellant Mark C. Kellberg, who

owned land adjacent to the Subject Property, objected to the

approval because he claimed that the consolidation and

resubdivision violated the Hawai#i County Subdivision Control

Code, also known as Chapter 23 of the Hawai#i County Code (HCC),

by increasing the number of lots on the Subject Property.

           Kellberg later filed suit against

petitioners/defendants-appellees, Christopher J. Yuen, in his

capacity as Planning Director, and the County of Hawai#i

(collectively, “County Defendants”) in the Circuit Court of the

Third Circuit.

           Kellberg’s complaint included six counts:           Count I

alleged that the Planning Director violated Chapter 23; Count II

alleged that the Planning Director’s violations of Chapter 23

rendered the subdivision void and entitled Kellberg to a

declaratory judgment; Count III alleged that the County

Defendants violated Kellberg’s right to due process; Count IV

alleged that the Planning Director abused his discretion by not

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remedying the violations of Chapter 23 in a timely manner; Count

V alleged that Kellberg was entitled to an injunction requiring

the County Defendants to comply with Chapter 23; and Count VI

alleged that Kellberg was entitled to monetary damages.            Kellberg

prayed for a declaratory judgment that the subdivision was

illegal and void under Chapter 23, a decree of specific

performance for the Planning Director to bring the subdivision

into compliance with Chapter 23, an injunction enjoining further

subdivision of the Subject Property inconsistent with Chapter 23,

monetary damages, and attorney’s fees and costs.

           The circuit court granted the County Defendants’ motion

for summary judgment on all counts.        Kellberg appealed, and the

Intermediate Court of Appeals (ICA) vacated and remanded with

instructions for the circuit court to dismiss the case for lack

of subject matter jurisdiction because Kellberg failed to exhaust

his administrative remedies.       Kellberg filed an application for a

writ of certiorari, which was accepted.

           This court held that the ICA erred “by holding that

Kellberg’s Complaint should have been dismissed for lack of

subject matter jurisdiction based on the exhaustion doctrine.”

Kellberg v. Yuen, 131 Hawai#i 513, 534, 319 P.3d 432, 453 (2014)

(“Kellberg I”).    Accordingly, this court vacated the ICA’s

judgment and remanded to the ICA for consideration of the

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remaining issues raised by Kellberg in his appeal.           Id. at 537,

319 P.3d at 456.

           On remand, the ICA held that the Planning Director’s

approval of Pruglo’s subdivision was invalid because it increased

the number of lots, and therefore, Kellberg was entitled to

judgment as a matter of law on Counts I and II.           The ICA further

held that Counts III and IV were moot.         The ICA vacated the

circuit court’s judgment in favor of the County Defendants and

remanded to the circuit court.

           We accepted the County Defendants’ timely application

for a writ of certiorari, which presented the following

questions:

           1.    Where the undisputed evidence demonstrated the
                 subject property consists of six, not seven
                 lots, was it error to declare the subdivision
                 invalid?

           2.    Prior to vacating the judgment in favor of the
                 County and entering judgment in favor of
                 Kellberg, should the ICA have considered all of
                 the County’s arguments which were relied upon by
                 the Circuit Court in granting summary judgment?

           3.    When a party seeks to invalidate a subdivision
                 must the owners of the subject property be
                 joined as parties prior to voiding the
                 subdivision?

           As set forth below, the ICA erred in ruling on the

merits of Kellberg’s claims without addressing whether the owners

of the lots within the Subject Property (lot owners) were

required to be joined as parties under HRCP Rule 19.              Because

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Kellberg sought to have the subdivision declared void, the lot

owners were necessary parties under Rule 19(a).             Nothing in the

record establishes that they could not have been joined.

Therefore, we vacate the judgments of the ICA and circuit court

and remand to the circuit court with instructions to order the

joinder of the lot owners under Rule 19.

             On remand, if it is not feasible to join the lot

owners, the circuit court must consider the factors set forth in

HRCP Rule 19(b) and determine whether in equity and good

conscience the action should proceed among the parties before it,

or whether the action should be dismissed, the lot owners thus

being regarded as “indispensable.”          In other words, a court may

not reach the merits of a case until either the necessary parties

are joined, or the court determines that the action may proceed

in their absence.

                               I.   Background

A.   Factual background

             In April 2000, Prudential Orchid Isle Properties

(Prudential) requested from the County of Hawai#i Planning

Department a determination of the number of pre-existing lots1 on

      1
            HCC § 23-3(21) (Supp. 2012) defines “pre-existing lot” as “a
specific area of land that will be treated as a legal lot of record based on
criteria set forth in this chapter.”

             HCC § 23-118(a) (2005) provides that the Planning Director
                                                                 (continued...)

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a 49-acre parcel of land zoned as AG 202 in Ninole, Hawai#i.

Kellberg I, 131 Hawai#i at 516, 319 P.3d at 435.            On May 22,

2000, then-Planning Director, Virginia Goldstein, wrote to

Prudential that the Subject Property consisted of six pre-

existing lots.     Id.   A map attached to Goldstein’s letter showed

that the larger 48.47–acre portion of the Subject Property

consisted of five adjoining lots, and that the smaller 0.6–acre

non-contiguous portion of the Subject Property constituted a

sixth lot (identified as Lot 4 on the map).           Id.

            In December 2003, the then-owners of the Subject

Property informed the Planning Department that they desired to

consolidate and resubdivide the Subject Property and believed

      1
       (...continued)

            shall certify that a lot is pre-existing if the lot
            meets one of the following criteria:

            (a) The lot was created and recorded prior to November
            22, 1944 or the lot was created through court order
            (e.g. partition) prior to July 1, 1973, and the lot
            had never been legally consolidated, provided that no
            preexisting lot shall be recognized based upon a lease
            except for a lease which complied with all other
            applicable laws when made, including Territorial
            statutes regulating the sale or lease of property
            . . . , and on September 25, 2002, the proposed lot
            contains a legal dwelling, or has been continuously
            leased since January 8, 1948, as a separate unit.

            (b) The lot was created prior to December 21, 1966, as
            an agricultural lot in excess of twenty acres pursuant
            to County ordinance.
      2
            “AG 20” means the land is in an agricultural district, so under
Chapter 25 of the HCC, the parcel may not include a lot smaller than twenty
acres. HCC § 25-5-71 (Supp. 2009).

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that the property consisted of at least seven lots.                Id.   In June

2004, Yuen, who had taken over as Planning Director, responded

that the Subject Property consisted of two separate lots, one of

which was the small non-contiguous plot.            Id.

              Also in 2004, Pruglo purchased the Subject Property.

Id.     In January 2005, Sidney M. Fuke, a planning consultant

working with Pruglo, wrote to the Planning Director to

memorialize a discussion between Fuke and Yuen, in which Fuke

claimed that the Planning Director agreed that based on

Goldstein’s May 2000 letter, the Subject Property consisted of

six pre-existing lots.         Id.   On April 7, 2005, Fuke, on Pruglo’s

behalf, filed a “Consolidation/Resubdivision Application” with

the Planning Department, seeking to consolidate and resubdivide

the Subject Property’s six pre-existing lots into six new lots.

Id.

              On June 1, 2005 the Planning Director granted tentative

approval of the preliminary plat map included with Pruglo’s

application.      Id.   Fuke submitted a final plat map to the

Planning Director on July 1, 2005.           Id.   Both the preliminary

plat map and the final plat map identified a 48-acre portion of

the Subject Property as “Parcel 1,” and divided Parcel 1 into six

lots.     Id.   Both maps also showed the existence of a 0.6-acre

non-contiguous portion of the Subject Property.              Id.    While the

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non-contiguous portion was labeled “Parcel 2” on the preliminary

plat map, it was not labeled on the final plat map.            Id.

           In July 2005, the Planning Director approved Pruglo’s

consolidation and resubdivision application.          Id.    Kellberg, an

owner of a parcel of land adjacent to the Subject Property,

claimed that he first learned of Pruglo’s application and the

Planning Director’s approval “on August 11, 2005, when he

observed a ‘for sale’ sign on the Subject Property, and a realtor

later called him with an offer to sell him a newly created lot

along his property line.”       Id. at 517, 319 P.3d at 436.         The next

day, Kellberg went to the Planning Department and attempted to

file an appeal.    Id.   A Planning Department employee informed

Kellberg that he could not file an appeal because the thirty-day

period for filing appeals had already passed.          Id.   Kellberg left

his contact information with the employee and requested that the

Planning Director call him later that day.          Id.   The Planning

Director did not call Kellberg.       Id.

           Kellberg voiced his concerns about the subdivision

approval in letters to the Planning Director on August 16, 2005,

and January 17, 2006.     Id.    In both letters, Kellberg explained

that because the subdivision resulted in seven lots instead of

six, it was inconsistent with the Planning Director’s prior

approval for a six-lot subdivision.         Id.   Kellberg further

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explained that this error was evident in the final subdivision

plan on file with the Planning Department, which revealed that

the Planning Department did not account for the existence of the

non-contiguous portion of the Subject Property.           Id.

           In March 2006, Kellberg requested from the Planning

Department information on how to appeal the Planning Director’s

approval of Pruglo’s subdivision application to the Board of

Appeals, County of Hawai#i (BOA).        Id.   The Chairman of the BOA

informed Kellberg that he could not appeal because the thirty-day

period for filing appeals had passed.          Id.

           On April 19, 2006, Pruglo submitted a second

consolidation and resubdivision application to the Planning

Department, this time seeking to consolidate the non-contiguous

portion of the Subject Property with one of the six lots created

by the previous subdivision.       Id. at 517-18, 319 P.3d at 436-37.

Kellberg asked the Planning Director to notify him when Pruglo’s

subdivision application was approved.          Id. at 518, 319 P.3d at

437.

           Several months later, in August 2006, Kellberg’s

counsel informed the Planning Director that he assumed an appeal

was premature because Kellberg had not received notice of any

action on behalf of the Planning Director in regards to Pruglo’s

pending application.     Id.   Kellberg’s counsel requested

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notification of when tentative approval was granted.              Id.

           The following passage is taken from an October 23, 2006

letter from the Planning Department to Kellberg and his counsel:
           On May 22, 2000, the Planning Department sent a letter
           on this subject stating that the department recognized
           six pre-existing lots within this tax map key [(TMK)]
           parcel. However, in response to a December 24, 2004
           request to recognize seven lots, based on some old
           plantation camp houses, the Planning Department sent a
           letter stating that only two lots were recognized.
           This was a mistake, because the Department should have
           respected the previous determination. Later, Mr.
           Fuke, representing the owner, met with me to discuss
           the case for more lots based on the old houses. . . .
           When [Fuke] brought it to my attention that the
           Department had previously recognized six lots, I told
           Mr. Fuke that we would honor the previous letter,
           which is our general policy. I did not re-analyze the
           number of lots based upon the old houses.

           [Pruglo] then submitted a consolidation/resubdivision
           (Sub. 05-00064) based on the six pre-existing lots.
           As Mr. Kellberg correctly points out, there was a
           mistake in the approval of that subdivision. One of
           the six recognized lots was a 0.699 acre portion of
           Grant 11,070. For some reason, it was not contiguous
           with the remainder of TMK No. 3-2-2-35. In the
           consolidation/resubdivision, the Planning Department
           did not notice that this noncontiguous portion had
           been included in the lot count. Thus, it remained
           separate, and is now TMK No. 3-2-2-110. Thus, with
           the six lots in Sub. 05-00064 and parcel 110, there
           are now seven lots instead of six.

           I am not going to do anything to undo this situation
           at this time. Sub. 05-00064 has received final
           subdivision approval and at least some of the lots
           have been sold. Given that parcel 110 is physically
           separated from the remainder of Sub. 05-00064, and
           from any property owned by the subdivider, I cannot
           see a way to erase its separate existence.

(Emphases added).

           Kellberg responded to the Planning Director in a

February 6, 2007 letter, asserting that it was within the

Planning Director’s power under Chapter 23 “to resolve the

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original lot count ‘mistake’ by simply . . . reducing the total

number [of lots] created to the requisite six.”             Kellberg I, 131

Hawai#i at 519, 319 P.3d at 438.

B.     Proceedings in the circuit court and before the BOA

             In May 2007, Kellberg filed a complaint in the circuit

court against the County Defendants.          Id.   Kellberg’s complaint

included six counts.

             Although not pled with precision, Count I alleged the

Planning Director violated Chapter 23 of the HCC by approving

Pruglo’s application because the subdivision resulted in seven

lots rather than two, and that Kellberg was “a person aggrieved”

by the approval; Count II alleged that the Planning Director’s

violations of Chapter 23 rendered the subdivision void and that

Kellberg was entitled to a declaratory judgment as to these

violations; Count III alleged that the County Defendants violated

Kellberg’s right to due process under the United States and

Hawai#i constitutions by not providing him with notice of the

Planning Director’s approval of Pruglo’s application and by

depriving him of an opportunity to voice his objections to the

approval; Count IV alleged that the Planning Director abused his

discretion by not remedying the violations of Chapter 23 in a

timely manner and thus his approval of the subdivsion was void;

Count V alleged that Kellberg was entitled to an injunction

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requiring the County Defendants to comply with Chapter 23 and

prohibiting them from permitting more than two lots on the

Subject Property and from allowing any subdivision of the Subject

Property other than in accordance with the HCC; and Count VI

alleged that Kellberg’s property had been “adversely and

materially impacted” by the Planning Director’s approval of

Pruglo’s subdivision application, that Kellberg suffered

“material and substantial disadvantage and monetary harm,” and

that he was entitled to monetary damages.          Id. at 519-20, 319

P.3d at 438-39.     Counts II-VI incorporated all of the allegations

in the prior counts.

           The complaint included the following prayer for relief:
           A.     Pursuant to all Counts, that SUB-05-00064 be
                  declared illegal and violative of the
                  Subdivision Control Code and therefore void; and

           B.     That pursuant to Count II and Chapter 632 this
                  Court declare that Defendant Yuen’s conduct in
                  approving SUB-05-00064 as described hereinabove
                  is illegal and void as against public policy;
                  and

           C.     That pursuant to Count III and the Fifth and
                  Fourteenth Amendments to the United States
                  Constitution and Article I, § 5 of the Hawai#i
                  Constitution Plaintiff be provided procedural
                  and substantive due process with notice and an
                  opportunity to be heard on the merits of SUB-05-
                  00064; and

           D.     That pursuant to Count IV this Court find
                  Defendant Yuen’s refusal to act to correct SUB-
                  05-00064 constitutes an abuse of discretion and
                  direct him to take such actions as are necessary
                  to correct SUB-05-00064 to comply with the
                  Subdivision Control Code and Zoning Code; and

           E.     That pursuant to Count V this Court issue its

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                  mandatory injunction requiring Defendant Yuen
                  correct SUB-05-00064 and restraining and
                  enjoining Defendant Yuen and Defendant County
                  from approving further subdivision of the
                  Subject Property unless and until the Subject
                  Property is brought into compliance with the
                  Subdivision Control Code; and

            F.    That pursuant to Count VI this Court award
                  Plaintiff monetary damages according to proof at
                  trial; and

            G.    That Plaintiff be awarded his attorney’s fees
                  and costs; and

            H.    That this Court grant Plaintiff such other and
                  further relief as is just and proper.

(Emphasis added).

            The County Defendants raised ten defenses in their

answer, including that Kellberg failed to join necessary parties

and failed to exhaust administrative remedies.

            In July 2008, the County Defendants filed a motion to

dismiss for failure to exhaust administrative remedies and for

failure to join an indispensable party (County’s Motion to

Dismiss).    They argued that (1) the circuit court did not have

subject matter jurisdiction because Kellberg failed to exhaust

all available administrative remedies by not appealing the

Planning Director’s October 23, 2006 letter within thirty-days,

and (2) dismissal was warranted because Pruglo was an

“indispensable” party under HRCP Rule 19.3

     3
            HRCP Rule 19 (2000) provides, in relevant part:

            (a) Persons to be Joined if Feasible. A person who is
            subject to service of process shall be joined as a
                                                               (continued...)

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            At the hearing on the motion,4 the following exchange

occurred between the circuit court, Kellberg’s counsel

(Whittaker), and the County Defendants’ counsel (Udovic):
                  THE COURT: -- okay. The indispensable parties
            one really depends on what remedies you’re -- you’re
            really seeking. If you’re seeking to undo the
            subdivision, then maybe Mr. Udovic’s correct. If
            you’re just seeking damages, maybe not.

            . . . .

                  . . . But if I determined that it is an illegal
            subdivision, it will definitely affect the property
            rights of the people who have now bought the

      3
       (...continued)
            party in the action if . . . (2) the person claims an
            interest relating to the subject of the action and is
            so situated that the disposition of the action in the
            person’s absence may (A) as a practical matter impair
            or impede the person’s ability to protect that
            interest or (B) leave any of the persons already
            parties subject to a substantial risk of incurring
            double, multiple, or otherwise inconsistent
            obligations by reason of the claimed interest. If the
            person has not been so joined, the court shall order
            that the person be made a party. . . .

            (b) Determination by Court Whenever Joinder Not
            Feasible. If a person as described in subdivision
            (a)(1)-(2) hereof cannot be made a party, the court
            shall determine whether in equity and good conscience
            the action should proceed among the parties before it,
            or should be dismissed, the absent person being thus
            regarded as indispensable. The factors to be
            considered by the court include: first, to what
            extent a judgment rendered in the person’s absence
            might be prejudicial to the person or those already
            parties; second, the extent to which, by protective
            provisions in the judgment, by the shaping of relief,
            or other measures, the prejudice can be lessened or
            avoided; third, whether a judgment rendered in the
            person’s absence will be adequate; fourth, whether the
            plaintiff will have an adequate remedy if the action
            is dismissed for nonjoinder.

(Emphases added).
      4
            The Honorable Glenn S. Hara presided, and continued to do so until
December 17, 2010. The Honorable Ronald Ibarra presided thereafter.

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           subdivided lots.

                 MR. WHITTAKER: Indeed. Indeed. But that is
           not Mr. Kellberg’s complaint and that is not the suit
           that he has filed; and indeed if the County’s got a
           problem with that or a concern, then all of the
           remedies Rules 19 [joinder of persons needed for just
           adjudication], 20 [permissive joinder of parties], 14
           [third-party practice], 13 [counterclaim and cross-
           claim], they join who they want, but they can’t make
           [Kellberg] sue his neighbor because he complains
           against the County’s Planning Director for his illegal
           action. They can’t just say, well, Rule 19, you’ve
           got to go through your neighbor. No, no. The bad act
           complaint that was committed by the County of Hawaii
           and its Planning Director.

                 . . . What pleading would I create when I have
           had no complaint from Mr. Kellberg versus Mr.
           [Pruglo]? Mr. [Pruglo] is the beneficiary of the
           County’s illegal action . . . .

                 . . . If they want him in, let them bring him
           in.

                 MR. UDOVIC: Your Honor, the real issue here is
           that the lawsuit filed by Mr. Kellberg is going to
           affect Mr. [Pruglo] and the other persons by holding
           the property, and we’re not the one doing that. Mr.
           Kellberg is. It’s his obligation to bring in the
           necessary parties under Rule 19 to make sure that just
           determination of the action takes place.

                 THE COURT: Okay. I’m going to, again, deny
           your motion with respect to the dismissal because of
           the lack of joinder of indispensable parties. At this
           point, it doesn’t seem to me that the landowners are
           indispensable.

                 If the Court -- the Court given the, uh,
           requested relief I think [it] can give complete relief
           in terms of what Mr. Kellberg’s asking for. I think
           it’s the County’s anticipation of the fallout of that
           relief that will, uh, possibly, uh, affect the rights
           of other parties; and at that point, I don’t know if
           it’s more of a problem of the County versus those
           landowners and the subdivider without Mr. Kellberg’s
           participation in that matter if it gets that far.

           In September 2008, the circuit court entered an order

denying the County’s Motion to Dismiss, finding that the County

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failed to establish that administrative processes were available

to Kellberg, and that while Pruglo “has an interest in SUB 05-

00064, he is not an indispensable party to this action.”

            In May 2009, Kellberg filed a motion for partial

summary judgment as to Counts I (Violation of Statute), II

(Declaratory Judgment), and IV (Abuse of Discretion) of the

complaint.    Kellberg I, 131 Hawai#i at 521, 319 P.3d at 440.              In

opposition, the County Defendants again argued that Kellberg

failed to join indispensable parties.         In July 2009, the circuit

court entered an order granting Kellberg’s motion for partial

summary judgment, concluding that Kellberg should have been

afforded an opportunity to appeal the Planning Director’s

October 23, 2006 letter, and “remand[ing]” the case to the BOA to

consider Kellberg’s appeal of the October 23, 2006 letter.              Id.

It appears the circuit court did not address the issue of

indispensable parties.5

            In September 2009, Kellberg filed a petition with the

BOA appealing the Planning Director’s:          (1) January 12, 2005

      5
             Subsequently, on August 12, 2009, “Fuke submitted a revised
application for Subdivision 06–000333, to consolidate the non-contiguous
parcel (TMK 3–2–02:110) with another lot created by Subdivision 05–00064 (TMK
3–2–02:68),” which revised Pruglo’s April 19, 2006 application. Kellberg I,
131 Hawai#i at 518 n.3, 319 P.3d at 437 n.3. “Although the final approval of
Subdivision 06–000333 is not included in the record on appeal,” id., it
appears the consolidation was approved in December 2010. On April 13, 2011,
Daryn Arai, the Planning Department’s Planning Program Manager and an employee
of the Planning Department since 1987, declared that the non-contiguous lot
had “been consolidated with an adjoining property.”

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decision to honor Goldstein’s May 22, 2000 determination that the

Subject Property consisted of six lots; (2) July 11, 2005

approval of Pruglo’s first consolidation and resubdivision

application; and (3) October 23, 2006 letter stating that the

Planning Director had valid reasons for not bringing the Subject

Property into compliance with Chapter 23.            Kellberg I, 131

Hawai#i at 521, 319 P.3d at 440.          The County Defendants filed a

motion to dismiss Kellberg’s petition.            Id. at 522, 319 P.3d at

441.     The County Defendants argued that Kellberg lacked standing,

the Planning Director’s October 23, 2006 letter was not an

appealable decision, and that the BOA lacked jurisdiction because

Kellberg failed to file an appeal within the thirty-day time

period allowed for appeals.

              Following a hearing, the BOA dismissed Kellberg’s

petition on the basis that it lacked jurisdiction because

Kellberg’s appeal of the Planning Director’s October 23, 2006

letter was filed after the thirty-day appeal period had expired.

Id.

              In March 2010, Kellberg then filed in the circuit court

a motion for partial summary judgment on Count V (Injunction) and

for Injunction Against the County of Hawai#i (Motion for

Injunction).      Id.   Kellberg’s Motion for Injunction sought “an

injunction remanding the case to the Planning Department with

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instructions to the Planning Director to bring the subdivision

into compliance with [Chapter 23 of the HCC], and enjoining the

County Defendants from ‘allowing the further sale, transfer of

ownership, or development and improvement of lots created’ by the

subdivision until compliance is demonstrated.”            Id.

           In opposition, the County Defendants argued that an

injunction was not warranted because, inter alia, such relief

would adversely affect the rights of the lot owners who were not

parties to the suit, and thus would violate HRCP Rule 19.

           At the start of the April 28, 2010 hearing on the

Motion for Injunction, the circuit court sought clarification on

why the parties were before the court in light of its remand to

the BOA:
                 THE COURT: . . . I just have a couple
           questions, and I understand that this is basically a
           motion for the summary judgment on injunctive relief,
           but my recollection is that this case was remanded
           back to the [BOA]?

                 MR. UDOVIC: Yeah. But the problem is it never
           came from there the first time, Judge.

                 THE COURT:   Oh, okay.

                 MR. UDOVIC: It was sent there. You sent it to
           there. You called it remand, but it never came up
           from the [BOA].

                 THE COURT: I thought that was more like a -- an
           order to -- to have the hearing on the appeal.

           . . . .

                 . . . I guess the question I   had was, didn’t
           they finally dismiss the appeal on   the same grounds
           that I found that Mr. Kellberg had   a basis to go ahead
           and have an appeal, and that is --   the timing of all

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           of these matters did not allow him to adequately lodge
           an appeal with the board?

           . . . .

                 MR. WHITTAKER: . . . I pointed out to the [BOA]
           and to Mr. Udovic, in response to the motion at that
           proceeding, that it was contrary to the intent and to
           the letter of Your Honor’s order.

                 . . . It was manifestly Your Honor’s intent that
           the [BOA] and the administrative agencies deal with
           the substance of this problem. Having failed to do
           so, we have asked Your Honor, on this motion, to deal
           with it in a very direct way, by instructing the
           planning director to bring it into compliance.

           The court then considered whether it was appropriate to

grant the Motion for Injunction.
                 MR. UDOVIC: I don’t think this is an
           appropriate vehicle for a summary judgment. I think
           there needs to be an evidentiary hearing with respect
           to the issues in this particular case. As we’ve
           pointed out, Your Honor, there are multiple issues in
           this case which exist, irrespective of the claims, the
           claims that title to these properties is being
           affected by requested [sic] injunction, that these
           parties aren’t parties to the -- to the -- to the –-
           to these proceedings. They weren’t named parties. I
           just stand on the issues that were submitted already
           in the documents that were submitted.

                 THE COURT: So why can’t I just grant the motion
           with respect to, as Mr. Whittaker says, having the
           planning director put things in order as it should
           have been, and you guys deal with the parties that
           need to be dealt with?

                 MR. UDOVIC: Well, if that’s the case, Your
           Honor, I would ask that, if the court issues an order
           like that, I would ask for an interlocutory appeal.

                 THE COURT: Okay, but why can’t -- what would be
           the problem with that?

                 MR. UDOVIC: Because what he’s asking you to do,
           Judge, is to have the planning director somehow, like
           there’s three different pieces of property which have
           already been sold. There’s bona fide purchasers on
           those lots. Are we going to disassociate those
           persons with – with -- from their properties? Are we
           gonna dispel them?

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              THE COURT: That’s your problem, right? You may
        have to buy ‘em out, you may have to pay ‘em, I don’t
        know.

              MR. UDOVIC: Well, but those are issues, I
        think, which -- which underlie this entire action,
        Your Honor.

              THE COURT: But then why are we at that point
        now that we have those three buyers?

              MR. UDOVIC: Because the properties were sold
        before this -- this lawsuit was even filed. You know,
        they were already owner of this property before this -
        - before Mr. Kellberg filed this action.

              THE COURT:   Mr. Whittaker?

              MR. WHITTAKER: There was an owner, actually two
        owners, I believe, before the action was filed. There
        were no bona fide purchasers for value. These parties
        knew, or should have known, because Mr. Pruglo knew
        from the day after the illegal subdivision was
        approved, that it was objected to by Mr. Kellberg,
        because a realtor presented at his property line
        offering to sell him a two-acre parcel of a 49-acre
        adjoining parcel. And he immediately began questions
        that’s led him, four and a half years later, to Your
        Honor’s courtroom asking that the planning director be
        told to bring the subdivision into compliance with the
        subdivision control code.

              Yes, Judge, as you pointed out, they may have to
        deal with those two buyers. One of them is -- has
        subsequently sold to another party, who certainly
        cannot claim to be ignorant of the proceedings. She
        was involved in the [BOA] proceedings. The other
        buyer, or owner, was Sydney Fuke, the individual who
        was instrumental in securing this subdivision for the
        buyer. And they are basically problems that they
        created with the planning director and the planning
        department, and they are not Mr. Kellberg’s problem.

        . . . .

              MR. WHITTAKER: . . . I know the court will,
        rely on Hawaii law in determining the issuance of the
        injunction. It’s clear that we have met the three-
        part test, including the likelihood of prevailing on
        the merits. We’ve prevailed already on Your Honor’s
        determination that there is a problem with compliance
        with the subdivision control code. The balance of
        irreparable damage clearly favors Mr. Kellberg in this
        lawsuit with the planning director and, as Your Honor
        has pointed out, they turned their back on the
        opportunity that this court gave them to solve it the

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           first time. It now requires a more clear
           direction. . . .

                 THE COURT: . . . I’m inclined to go ahead and
           grant the motion, but I’m reluctant to do so, at the
           same time. And let me tell you why.

                 First of all, in the back of my mind, there is a
           -- a feeling that perhaps if, at least on a summary
           judgment level, the issue of whether or not there may
           be adequate remedies at law in terms of damages would
           preclude the granting of a motion for summary
           judgment.

                 Second of all, the arguments that I have not
           fully resolved in my mind right now is whether
           injunctive relief of the nature that you’re requesting
           would, in fact, involve the part -- the interest
           parties who are not joined in the suit. Being that it
           would affect parcels that are already, at least on the
           book, legally subdivided and already conveyed. So, at
           this point, I really haven’t made up my mind, so I’ll
           take the matters under advisement, and I’ll reread the
           memos and consider the evidence.

(Emphases added).

           The circuit court subsequently entered an order denying

Kellberg’s Motion for Injunction, explaining in pertinent part:
                 2. [Kellberg’s Motion for Injunction] seeks to
           have this court issue an injunction prayed for in
           Count V in the initial complaint in this case filed on
           May 11, 2007. [Kellberg’s] Motion for Partial Summary
           Judgment filed on May 27, 2009 resulting in the
           court’s June 24, 2009 order remanding the matter to
           the [BOA] did not specifically invoke Count V of the
           complaint. This court’s order dated June 24, 2009,
           however, rendered Count V moot as the remand addressed
           [Kellberg’s] right and opportunity to be heard
           referred to in Count V.

                 3. The court denies [Kellberg’s] motion for the
           additional reason that [Kellberg] has failed to join
           the property owners of the subdivided property who
           would be affected by undoing the subdivision as
           required by the provisions of Rule 19 of [the HRCP.]

                 4. The motion for summary judgment would also
           be denied because there are genuine issues of material
           fact as to the equities of granting the motion in
           terms of the effect of the injunction on others even
           if they were found to be not required to be joined by

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           Rule 19 [of the] HRCP. [Kellberg’s] motion is not for
           a temporary restraining order or preliminary
           injunction to maintain the status quo. It is for a
           mandatory injunction to undo a completed action of a
           county agency upon which others have already relied.
           Granting the plaintiff injunctive relief would entail
           possible irreparable harm to others. The extent of
           such harm needs to be balanced as against the harm
           plaintiff sustains if injunction is not granted.
           These are material issues of which the facts are not
           undisputed.

                 5. Assuming there were no genuine issues of
           material fact involving the irreparable harm involved,
           the court would still deny the motion for injunctive
           relief finding that the equities in this matter do not
           favor [Kellberg] even assuming the property may have
           been subdivided in violation of the provisions of the
           [HCC]. A mandatory injunction undoing the subdivision
           would directly affect vested property rights of the
           persons who are now owners of the subdivided property
           which clearly outweighs the indirect effects of a
           presumed illegal subdivision that an adjoining
           property owner such as Mr. Kellberg might suffer due
           to, for example, increased density of use of the
           adjoining property.

(Emphases added).

           Approximately three weeks later, the circuit court

entered a second order denying the Motion for Injunction.

Kellberg I, 131 Hawai#i at 523, 319 P.3d at 442.          The second

order, which was substantially similar to the first order,

concluded, in relevant part:
           1.    Plaintiff’s Motion for Partial Summary Judgment
                 on Count V is deemed moot in light of the
                 court’s ruling on Plaintiff’s Motion for Partial
                 Summary Judgment on Count I (Violation of
                 Statute), Count II (Declaratory Judgment) and
                 Count IV (Abuse of Discretion) filed May 27,
                 2009 ordering the case to the [BOA] for
                 consideration of the issues. Plaintiff’s
                 failure to exhaust his administrative remedies
                 forecloses this court from further action in
                 this matter.

           2.    Furthermore, the court finds that owners of the
                 subdivided property are indispensible parties to

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                 this action as required under Rule 19 of the
                 HRCP, as to the relief sought on Count V.

           3.    Plaintiff’s failure to join owners of the
                 subdivided property means the action cannot
                 proceed in good conscience against the parties
                 before the court.

           4.    A mandatory injunction undoing the subdivision
                 would directly affect vested property rights of
                 the persons who are now owners of the subdivided
                 property and are not parties to this action.

           5.    Genuine issues of material fact exist when
                 balancing the equities between the unnamed
                 property owners and the Plaintiff which would
                 result in irreparable harm to the unnamed
                 property owners if the court were to grant
                 Plaintiff’s request for a permanent injunction.

           6.    Even assuming no genuine issues of material fact
                 are in existence, the court denies Plaintiff[’]s
                 motion for a permanent injunction. The grant of
                 an injunction is an equitable remedy and the
                 court is required to balance the equities
                 between the Plaintiff and the unnamed
                 indispensable parties.

           7.    Even in the event the court were to find the
                 subject property was subdivided in violation of
                 the provisions of the Hawaii Subdivision Code, a
                 mandatory injunction would be denied. The
                 issuance of an injunction would directly affect
                 vested property rights of the persons who are
                 now owners of parcels of the subdivided
                 property. The equities of the vested property
                 owners clearly outweigh the indirect effect of a
                 presumed illegal subdivision that an adjoining
                 property owner might suffer.

(Emphases added).

           On December 9, 2010, nearly two months after the

circuit court filed its second order, Kellberg filed a Motion for

Leave to File First Amended Complaint (Motion to Amend).

Kellberg explained that although he continued to disagree with

the circuit court as to the issue of indispensable parties, he

had “no alternative but to request permission to amend his

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Complaint” to include the lot owners as parties.           Kellberg’s

proposed amended complaint, which was attached to his memorandum

as an exhibit, added a number of new counts and named the

following defendants in addition to the County Defendants:

Pruglo; Christie D. Guastella and John H. Payne, II; John Scott

McCann and Frances Santa Maria McCann; and Susan T. McGuire, as

owners of lots within the Subject Property.          Those parties were

named defendants as to all counts, including the additional

counts contained in the amended complaint.

           The County Defendants opposed the Motion to Amend,

arguing that the amended complaint added new allegations and

claims, which Kellberg was dilatory in raising and would

“unfairly prejudice the County.”          The County Defendants further

argued that because additional discovery may be needed with

respect to the additional parties, Kellberg “should not be

allowed to impose these costs, expenses and delays upon the

County simply because he forgot to include necessary parties in

his complaint . . . .”

           The circuit court granted Kellberg’s Motion to Amend on

March 3, 2011.    Kellberg, however, did not file the amended

complaint.

           On April 21, 2011, the County Defendants moved for

summary judgment on all counts, asking the court to dismiss the

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complaint.   Kellberg I, 131 Hawai#i at 523, 319 P.3d at 442.               The

County Defendants argued that (1) Pruglo’s application to

consolidate and resubdivide the Subject Property did not seek to

change the number of lots on the property and the number of lots

did not change, and thus Pruglo’s application was exempt from the

standards and requirements of the HCC; (2) Kellberg’s due process

claims were without merit; (3) Kellberg’s abuse of discretion

claim was without merit; (4) Kellberg made a strategic decision

not to name the owners of the lots created by the consolidation

and resubdivision of the Subject Property as defendants, it was

too late to join the lot owners because the two-year statute of

limitations had run, and the case should not proceed without

them; and (5) Kellberg failed to exhaust his administrative

remedies by failing to appeal within thirty days of both the

Planning Director’s approval of Pruglo’s application and the

BOA’s ruling against Kellberg, and the circuit court therefore

lacked jurisdiction.

           The County Defendants argued that the lot owners were

indispensable parties because by seeking to void the subdivision,

Kellberg’s action “would severely affect the property owners who

are not parties and cannot be parties.”         The County Defendants

pointed out that even after the circuit court granted Kellberg

permission to add the indispensable parties, Kellberg failed to

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file his amended complaint and did not add them as parties.

           Kellberg responded that:       (1) the maps on file with the

Planning Department, together with the Planning Director’s

June 2, 2004 letter, indicate the Subject Property consisted of

two pre-existing lots, not six or seven; (2) Kellberg exhausted

all administrative remedies available to him prior to filing the

lawsuit with the circuit court; and (3) the owners of the lots

were not indispensable parties, or were only indispensable as to

Count V of Kellberg’s complaint.

           The County Defendants replied that Kellberg failed to

put forth any admissible evidence refuting the County Defendants’

arguments, and there were no genuine issues of material fact.

           At the May 2011 hearing on the County Defendants’

motion for summary judgment, the following exchange occurred

between the attorneys and the court:
                 MR. WHITTAKER: But, Judge, other than what I
           put in the Memorandum in Opposition and referenced
           back in the record, I don’t have a whole lot more to
           add. It is concerning to me that this motion was
           brought when it was by counsel who is new to the case,
           to a Court that is new to the case. . . . [O]n today’s
           motion I can stand on my papers, Judge, there’s enough
           in the record. It just cannot be granted.

                 THE COURT: Yeah, if -- I think you’re correct,
           if there’s admissible evidence in the file which you
           point out to, certainly the Court should review that.
           But frankly, as you stated, you know, whatever the
           past record is regarding this, this Court has not
           reviewed the entire file. Except the motions and
           pleadings in support of the motion before the Court.

           . . . .

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                   So if you want me to review the entire file and
             argue that what is in the entire file is supplement to
             your position, the Court would appreciate if you would
             point out that certain document.

                   MR. WHITTAKER: Well I believe in our statement
             of facts we refer the Court back to the memorandum
             that we filed that rebut the spin on the facts that
             the Defendants tried to give this court. And it is,
             Judge, a spin. Definitively.

                   And in answer to the allegations that I am
             making some kind of scurrilous statement about anybody
             here in my opposition; not so, Judge. I am simply
             telling the Court the facts as Plaintiff believes the
             record clearly supports them. . . .

                   THE COURT: Okay.   Miss Martin?

                   MS. MARTIN: Thank you, Your Honor.

                    Your Honor, it’s undisputed that pre-existing
             lots were recognized back in 2000. And it’s
             undisputed that pre-existing lots are not subject to
             the subdivision ordinance. There is [sic] really no
             facts in dispute for a jury to decide in this case. .
             . . The Defendants are entitled to this -- to have
             summary judgment granted their favor. Thank you, Your
             Honor.

                   THE COURT: Okay, I’m going to take it under
             submission.

             In June 2011, the circuit court granted summary

judgment in favor of the County Defendants on all counts.

Kellberg I, 131 Hawai#i at 523, 319 P.3d at 442.

C.     Kellberg’s appeal to the ICA

             Kellberg timely appealed to the ICA the order granting

summary judgment in favor of the County Defendants, and eight

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prior orders by the circuit court.6        Kellberg I, 131 Hawai#i at

523, 319 P.3d at 442.

            As relevant here, Kellberg argued in his opening brief

that (1) he had no available administrative remedy prior to

filing the lawsuit and his attempt to pursue an administrative

remedy at the BOA had been futile; (2) the circuit court erred in

granting summary judgment in favor of the County Defendants and

“dismissing the case” based on its finding that the lot owners

were “indispensable parties” because there was no evidence in the

record that the lot owners could not have been joined; and (3)

because the subdivision was illegal, the lot owners’ rights did

not vest.

            The County Defendants answered, inter alia, that (1)

Kellberg failed to exhaust administrative remedies; (2) Kellberg

made a strategic decision not to name the property owners, who

were “indispensible parties”; and (3) the lot owners had

significant property rights and the Planning Director

appropriately refused to take those away.          The County Defendants

      6
            Kellberg appealed the following eight orders that were identified
in the circuit court’s Final Judgment: (1) July 24, 2009 order granting
Motion for Partial Summary Judgment; (2) September 22, 2010 order denying
Motion for Injunction; (3) October 15, 2010 order denying Motion for
Injunction; (4) June 14, 2011 order denying Motion for Supplemental Injunctive
Relief; (5) June 16, 2011 order denying Motion to Enforce Judgment; (6) June
16, 2011 order granting motion for summary judgment; (7) August 31, 2011 order
granting in part and denying in part Motion to Vacate; (8) January 23, 2012
order denying Motion for Clarification; and 9) February 28, 2012 Final
Judgment. Kellberg I, 131 Hawai#i at 523 n.12, 319 P.3d at 442 n.12.

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also argued that the lot owners could no longer be joined as

defendants because the applicable two-year statute of

limitations, Hawai#i Revised Statutes (HRS) § 657-77, had run,

and neither HRCP Rule 15(c)8 nor Rule 17(d)9 provided relief

because Kellberg knew the identities of the lot owners and “made

      7
            HRS § 657-7 (1993) provides: “Actions for the recovery of
compensation for damage or injury to persons or property shall be instituted
within two years after the cause of action accrued, and not after, except as
provided in section 657-13.” HRS § 657-13 (1993) provides an exception to the
two-year statute of limitations for plaintiffs who are, at the time the cause
of action accrued, minors, insane, or imprisoned.
     8
           HRCP Rule 15(c) (2012) provides:

           (c) Relation back of amendments. An amendment of a
           pleading relates back to the date of the original
           pleading when

           (1) relation back is permitted by the law that
           provides the statute of limitations applicable to the
           action, or

           (2) the claim or defense asserted in the amended
           pleading arose out of the conduct, transaction, or
           occurrence set forth or attempted to be set forth in
           the original pleading, or

           (3) the amendment changes the party or the naming of
           the party against whom a claim is asserted if the
           foregoing provision (2) is satisfied and the party to
           be brought in by amendment (A) has received such
           notice of the institution of the action that the party
           will not be prejudiced in maintaining a defense on the
           merits, and (B) knew or should have known that, but
           for a mistake concerning the identity of the proper
           party, the action would have been brought against the
           party.
     9
           HRCP Rule 17(d) (2000) provides, in relevant part:

           (d) Unidentified defendant.

           (1) When it shall be necessary or proper to make a
           person a party defendant and the party desiring the
           inclusion of the person as a party defendant has been
           unable to ascertain the identity of a defendant . . .
           .

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a strategic decision” not to name them as defendants.            The County

Defendants pointed out that despite the circuit court’s grant of

Kellberg’s motion for leave to amend his complaint to add the lot

owners, Kellberg did not do so.

           In his reply, Kellberg conceded the he made a

“strategic decision” not to name the lot owners because they were

“not necessary parties to the action.”         Kellberg argued that he

made this decision because the County, not the lot owners, was

responsible for the subdivision approval.         Kellberg further

argued that the statute of limitations did not apply and that if

the County was “genuinely concerned” about being subject to

multiple or inconsistent obligations, it “always had the power to

insulate itself by way of a third party complaint.”

           In its June 20, 2013 Memorandum Opinion, the ICA

concluded that “Kellberg failed to exhaust the administrative

remedies available to him before commencing his action, leaving

the circuit court without jurisdiction to act on his complaint.”

Kellberg I, 131 Hawai#i at 524, 319 P.3d at 443.          Based on the

foregoing conclusion, the ICA vacated the circuit court’s Final

Judgment and remanded the case for an order of dismissal.             Id. at

525, 319 P.3d at 444.

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D.           Kellberg I

             Kellberg sought and this court accepted review of the

ICA’s decision.      This court held that the ICA erred “by holding

that Kellberg’s Complaint should have been dismissed for lack of

subject matter jurisdiction based on the exhaustion doctrine.”

Kellberg I, 131 Hawai#i at 534, 319 P.3d at 453.            Accordingly,

this court vacated the ICA’s July 19, 2013 Judgment on Appeal,

and remanded to the ICA for “consideration of the remaining

issues raised by Kellberg in his appeal.”             Id. at 537, 319 P.3d

at 456.

E.           The ICA’s decision on remand

             On remand, the ICA considered whether the circuit court

properly granted summary judgment in favor of the County

Defendants.     The ICA first concluded the County Defendants were

not entitled to summary judgment on Counts I and II.              As noted

above, Count I of Kellberg’s complaint alleged the Planning

Director violated Chapter 23 of the HCC by approving Pruglo’s

application because the subdivision resulted in seven lots rather

than two, and that Kellberg was “a person aggrieved” by the

approval.     Id. at 519, 319 P.3d at 438.          Count II alleged that

the Planning Director’s violations of Chapter 23 rendered the

subdivision void and that Kellberg was entitled to a declaratory

judgment as to these violations.            Id.   The ICA therefore

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concluded that the Planning Director’s approval of Pruglo’s

application was invalid, and that Kellberg was entitled to

judgment as a matter of law on Counts I and II.           Based on its

disposition of Counts I and II, the ICA concluded that Kellberg’s

constitutional claims asserted in Count III and allegation that

the Planning Director abused his discretion and violated the law

in Count IV were moot.      The ICA then vacated the circuit court’s

judgment as to Counts V (Injunction) and VI (Damages) because it

concluded that the circuit court granted summary judgment in

favor of the County Defendants as to Counts V and VI based on its

grant of summary judgment as to Counts I-IV.           The ICA did not

address the Rule 19 issues raised by the parties.

            The ICA therefore vacated the circuit court’s February

28, 2012 Final Judgment, and remanded with instructions for the

circuit court to enter summary judgment in favor of Kellberg on

Counts I and II, and to conduct further proceedings consistent

with its opinion, including a determination of any appropriate

forms of relief in favor of Kellberg.10

      10
            In a footnote, the ICA clarified that its ruling as to Count V

            should not be construed as a ruling that Kellberg is
            entitled to an injunction prohibiting the County “from
            permitting more than two (2) lots on the Subject
            Property,” which he is not, or any other specific form
            of relief. Rather, the circuit court may consider
            other appropriate relief on remand.

(Emphasis added).

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           The ICA entered its Judgment on Appeal on May 1, 2014,

and the County Defendants timely filed an application for a writ

of certiorari.    The County Defendants raise the following three

questions in their application:
           1.    Where the undisputed evidence demonstrated the
                 subject property consists of six, not seven
                 lots, was it error to declare the subdivision
                 invalid?

           2.    Prior to vacating the judgment in favor of the
                 County and entering judgment in favor of
                 Kellberg, should the ICA have considered all of
                 the County’s arguments which were relied upon by
                 the Circuit Court in granting summary judgment?

           3.    When a party seeks to invalidate a subdivision
                 must the owners of the subject property be
                 joined as parties prior to voiding the
                 subdivision?

                        II.   Standard of Review

           This court reviews a grant or denial of summary

judgment de novo.    First Ins. Co. of Haw. v. A&B Props., 126

Hawai#i 406, 413, 271 P.3d 1165, 1172 (2012) (citing Nu#uanu

Valley Ass’n v. City & Cnty. of Honolulu, 119 Hawai#i 90, 96, 194

P.3d 531, 537 (2008)).
           Furthermore, summary judgment is appropriate if the
           pleadings, depositions, answers to interrogatories and
           admissions on file, together with the affidavits, if
           any, show that there is no genuine issue as to any
           material fact and that the moving party is entitled to
           judgment as a matter of law. A fact is material if
           proof of that fact would have the effect of
           establishing or refuting one of the essential elements
           of a cause of action or defense asserted by the
           parties. The evidence must be viewed in the light
           most favorable to the non-moving party. In other
           words, we must view all of the evidence and inferences
           drawn therefrom in the light most favorable to the
           party opposing the motion.

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Id. (quoting Nu#uanu Valley Ass’n., 119 Hawai#i at 96, 194 P.3d at

537) (brackets omitted).

                            III.   Discussion

           The County Defendants argue that even if the Planning

Director’s approval of the subdivision was error, the ICA did not

consider alternative arguments raised in the County Defendants’

motion for summary judgment, including Kellberg’s failure to join

indispensable parties.      Kellberg responds that although the ICA

did not explicitly address the County Defendants’ alternative

arguments, the ICA implicitly rejected them.          Kellberg further

argues that the lot owners are not indispensable parties under

HRCP Rule 19 because they could have been joined by either the

County Defendants or by the court.

           Resolution of this appeal requires us to consider HRCP

Rule 19, which was cited by the County Defendants as an

alternative argument in their motion for summary judgment.             The

purpose of this rule is to protect the parties, and certain non-

parties who have the requisite interest in the case, to prevent

duplicative litigation and possibly inconsistent judgments.             As

set forth below, the ICA erred in ruling on the merits of

Kellberg’s claims without addressing whether the lot owners were

required to be joined as parties under Rule 19.           Because Kellberg

sought to have the subdivision declared void under each count,

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which would practically impair or impede the lot owners’ ability

to protect their interests, the lot owners were necessary parties

under Rule 19(a).    Nothing in the record establishes that they

could not have been joined, and thus the ICA should have vacated

and remanded with instructions for joinder under Rule 19.

           On remand, if it is not feasible to join the lot

owners, the circuit court must consider the factors set forth in

Rule 19(b) and determine whether in equity and good conscience

the action should proceed among the parties before it, or it

should be dismissed, the lot owners thus being regarded as

“indispensable.”

           Rule 19, Joinder of Persons Needed for Just

Adjudication, provides in relevant part:
           (a) Persons to be Joined if Feasible. A person who is
           subject to service of process shall be joined as a
           party in the action if . . . (2) the person claims an
           interest relating to the subject of the action and is
           so situated that the disposition of the action in the
           person’s absence may (A) as a practical matter impair
           or impede the person’s ability to protect that
           interest or (B) leave any of the persons already
           parties subject to a substantial risk of incurring
           double, multiple, or otherwise inconsistent
           obligations by reason of the claimed interest. If the
           person has not been so joined, the court shall order
           that the person be made a party. . . .

           (b) Determination by Court Whenever Joinder Not
           Feasible. If a person as described in subdivision
           (a)(1)-(2) hereof cannot be made a party, the court
           shall determine whether in equity and good conscience
           the action should proceed among the parties before it,
           or should be dismissed, the absent person being thus
           regarded as indispensable. The factors to be
           considered by the court include: first, to what
           extent a judgment rendered in the person’s absence
           might be prejudicial to the person or those already

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            parties; second, the extent to which, by protective
            provisions in the judgment, by the shaping of relief,
            or other measures, the prejudice can be lessened or
            avoided; third, whether a judgment rendered in the
            person’s absence will be adequate; fourth, whether the
            plaintiff will have an adequate remedy if the action
            is dismissed for nonjoinder.

(Emphases added).

            The purpose of Rule 19 is “to protect the interests of

absent persons as well as those already before the court from

multiple litigation or inconsistent judicial determinations.”                7

Charles Alan Wright, Arthur R. Miller, & Mary Kay Kane, Federal

Practice and Procedure § 1602 (3d ed. 2001) § 1602.11

            An analysis under Rule 19 “typically follows two

steps.”12   Marvin v. Pflueger, 127 Hawai#i 490, 499, 280 P.3d 88,

      11
             Although this treatise interprets Rule 19(a) of the Federal Rules
of Civil Procedure (FRCP), this court has observed that “[b]ecause [HRCP Rule
19 is] in all relevant aspects substantively identical to the federal rule[],
we may look to federal cases interpreting their rules for persuasive
guidance.” Marvin v. Pflueger, 127 Hawai#i 490, 499 n.11, 280 P.3d 88, 97
n.11 (2012).
      12
            The timing for raising a defense under Rule 19 is critical. In
Marvin, this court held that under HRCP Rule 12(b)(7), the defense of failure
to join a necessary party under Rule 19(a) must be raised by the defendant in
its answer or by motion, and “before pleading if a further pleading is
permitted[.]” 127 Hawai#i at 500, 280 P.3d at 98. Although the term
“necessary parties” is not used in Rule 19(a), Hawai#i courts sometimes refer
to persons that should be joined as parties if feasible under Rule 19(a) as
“necessary parties.” See, e.g., Life of the Land v. Land Use Comm’n, 58 Haw.
292, 298, 568 P.2d 1189, 1194 (1977) (“If the necessary parties cannot be made
parties to the action then the court should determine whether in equity and
good conscience the action should proceed among the parties before it, or
should be dismissed, the absent person(s) being thus regarded as
indispensable.” (internal quotations omitted)). If such a defense is not
timely raised (i.e., in an answer or by motion, and “before pleading if a
further pleading is permitted”) it is deemed waived under Rule 12(b)(h).
Marvin, 127 Hawai#i at 500, 280 P.3d at 98. Marvin further held that Rule 12
and Rule 19 read together allow “the defense of failure to join an
indispensable party under Rule 19(b)” to be raised at any time. Id. at 502,
280 P.3d at 100 (emphasis in original).
                                                                 (continued...)

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97 (2012) (citing UFJ Bank Ltd. v. Ieda, 109 Hawai#i 137, 142,

123 P.3d 1232, 1237 (2005)).       The first step includes

determination of whether Rule 19(a) applies and of whether

joinder is feasible:      the court “must determine whether an absent

party should be joined if feasible according to the factors

listed in subsection (a).”       Id.
           Rule 19(a) is applicable when nonjoinder would have
           either of the following effects. First, it would
           prevent complete relief from being accorded among
           those who are parties to the action or, second, the
           absentee “claims an interest relating to the subject
           matter of the action and is so situated” that the
           nonparty’s absence from the action will have a
           prejudicial effect on that person’s ability to protect
           that interest or will “leave any of the persons
           already parties subject to a substantial risk of
           incurring double, multiple, or otherwise inconsistent
           obligations.”

Wright et al., supra § 1604 (emphasis added).

           If Rule 19(a) applies, the court then considers whether

the person is subject to service of process in determining

whether joinder is feasible.       If joinder is feasible, the court

must order it.    HRCP Rule 19(a) (“A person who is subject to

service of process shall be joined as a party in the action

. . . .   If the person has not been so joined, the court shall

order that the person be made a party.”         (Emphases added)); see

     12
       (...continued)
            The timing/waiver issues addressed in Marvin are not implicated
here because the County Defendants raised the defense of “necessary parties”
in their Answer. The County Defendants also raised the Rule 19(a) defense in
their Motion to Dismiss and their Memorandum in Opposition to Kellberg’s
Motion for Injunction.

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also Wright et al., supra § 1611 (“If joinder is feasible, the

court must order it; the court has no discretion at this point

because of the mandatory language of the rule.”).

           Under the second step of the Rule 19 analysis, “if the

party meets the requirements under subsection (a) but it is not

feasible to join the party to the lawsuit, the court must proceed

to Rule 19(b) to determine whether it may decide the case without

the nonparty.”    Marvin, 127 Hawai#i at 499, 280 P.3d at 97.

Factors to be considered by the court under this second step

include:   “to what extent a judgment rendered in the person’s

absence might be prejudicial,” the extent to which “prejudice can

be lessened or avoided,” “whether a judgment rendered in the

person’s absence will be adequate,” and “whether the plaintiff

will have an adequate remedy if the action is dismissed for

nonjoinder.”   HRCP Rule 19(b).      This list of considerations is

not exhaustive, and “to a substantial degree the effective

operation of the rule depends on the careful exercise of

discretion by the [trial] court.”         Wright et al., supra § 1608.

If, under this second step, the court dismisses the action rather

than moving forward without the absent party, the nonparty is

described as “indispensable.”       Marvin, 127 Hawai#i at 499, 280

P.3d at 97.

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           Kellberg’s prayer for relief in his complaint

explicitly sought to void the subdivision as “to all counts.”               In

their motion for summary judgment, the County Defendants raised

numerous arguments, including that Kellberg failed to exhaust his

administrative remedies and that the lot owners were

indispensable parties because Kellberg failed to join them and

could no longer do so.      The circuit court granted the County

Defendants’ motion with little explanation, stating only that

“the record reflects the absence of any genuine issue of material

fact.”   On appeal in the ICA, the parties’ arguments included

both the exhaustion issue and the Rule 19 joinder issue.

           The ICA affirmed the circuit court’s judgment,

concluding that the circuit court lacked jurisdiction because

Kellberg failed to exhaust his administrative remedies.            Having

concluded that the circuit court lacked jurisdiction, the ICA did

not consider the County Defendants’ remaining arguments--

including the issue of whether the lot owners were indispensable

parties.   In Kellberg I, this court vacated the ICA’s judgment

and remanded the case, “for consideration of the remaining issues

raised by Kellberg in his appeal to the ICA.”          131 Hawai#i at

537, 319 P.3d at 456.     Although Kellberg did not file a cross

motion for summary judgment, the ICA concluded on remand that the

subdivision was invalid and that Kellberg was entitled to

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judgment as a matter of law, without considering the parties’

arguments under Rule 19.      The ICA erred in this regard.

           In the ICA, Kellberg argued that even if the lot owners

should have been joined under Rule 19(a), there was no evidence

in the record that they could not have been joined.            Therefore,

dismissal of Kellberg’s complaint and summary judgment in favor

of the County Defendants was inappropriate.          Specifically,

Kellberg argued that “[t]he remedy for an absent party adjudged

to be indispensable is not to take the radical step of dismissing

the case . . . .    Instead, under HRCP 19, the court was required

to evaluate whether the missing person was needed for just

adjudication, determine whether the person can be joined, and if

so, to order joinder.”

           Application of Rule 19 to the facts of this case

demonstrates that Kellberg should be ordered to join the lot

owners as defendants.     As set forth above, under the first step

of the Rule 19 analysis, the initial question is whether the

absent party “claims an interest relating to the subject of the

action and is so situated that the disposition of the action in

the person’s absence may . . . as a practical matter impair or

impede the person’s ability to protect that interest.”            HRCP Rule

19(a).   The lot owners meet this requirement, and the circuit

court recognized as much in denying Kellberg’s Motion for

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Injunction, noting that “undoing the subdivision would directly

affect vested property rights of the persons who are now owners

of the subdivided property.”13      The lots are owned by several

owners, who therefore claim an interest relating to the Subject

Property.    Further, invalidating the subdivision would “impair or

impede” the lot owners’ ability to protect their respective

property interests.     See, e.g., Haiku Plantations Ass’n v. Lono,

56 Haw. 96, 103, 529 P.2d 1, 5 (1974) (“This court cannot

undertake to hear and determine questions affecting the interests

of these absent persons unless they are made parties and have had

an opportunity to come into court.” (quotation marks and citation

omitted)).

            Moreover, failing to include the lot owners in the

instant case may leave the County Defendants “subject to a

substantial risk of incurring double, multiple, or inconsistent

obligations.”    HRCP Rule 19(a).      For example, if the subdivision

is rendered invalid, the lot owners will likely seek their own

      13
            On appeal in the ICA, Kellberg argued that the lot owners did not
have vested property rights because the subdivision was void. This argument
is without merit because, as noted above, the first step of the Rule 19
analysis asks whether the absent party “claims an interest relating to the
subject of the action[,]” not whether the absent party has a vested interest.
HRCP Rule 19(a). Put another way, the question of whether an absent party has
an interest sufficient to trigger the obligation to join that party is
distinct from the ultimate determination of the merits of that claim.
Additionally, an absent party may be silent and still “claim an interest”
under Rule 19(a) because “‘claims an interest’ in this context means nothing
more than appears to have such an interest.” Tell v. Trs. of Dartmouth Coll.,
145 F.3d 417, 419 (1st Cir. 1998).

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relief from the County Defendants.         In these circumstances, Rule

19(a) plainly applies.      Relatedly, granting summary judgment in

favor of the County Defendants without first ordering joinder of

the lot owners was inappropriate.14        See HRCP Rule 21 (2000)

(“Parties may be dropped or added by order of the court on motion

of any party or of its own initiative at any stage of the action

and on such terms as are just.”).

            Kellberg appears to now argue that the lot owners are

not necessary because “he asserted only that the Director (1)

wrongfully approved the 2005 subdivision and (2) denied Kellberg

due process.”     Although this argument is ambiguous, it appears

that Kellberg may be suggesting that he seeks only limited

relief, such as damages.       But his prayer for relief in his

complaint explicitly sought to void the subdivision as “to all

counts.”    Voiding the subdivision would certainly impair or

      14
            We note that the circuit court should have ordered joinder of the
lot owners at several points earlier in the litigation, which could have
prevented the delay and inconvenience that the parties now face and Rule 19
was intended to avoid. For example, the circuit court should have ordered
joinder of the then-existing lot owners when it ruled on the County
Defendants’ Motion to Dismiss and before ruling on Kellberg’s first motion for
partial summary judgment. The County Defendants had raised the issue of
joinder in both proceedings. Further, although the circuit court
appropriately concluded that the lot owners were required to be made parties
as to Count V in its denial of Kellberg’s second motion for partial summary
judgment, the circuit court should have also specifically ordered that the lot
owners be made parties as to all counts in Kellberg’s complaint, since it
sought to invalidate the subdivision in all of the counts. See HRCP Rule
19(a) (“A person who is subject to service of process shall be joined as a
party in the action . . . . If the person has not been so joined, the court
shall order that the person be made a party.” (Emphases added)).

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impede the lot owners’ ability to protect their ownership

interests.

            Under Rule 19, the next question is whether joining the

lot owners is feasible.       Here, there is no suggestion in the

record that the lot owners are not subject to service of process

or that joinder is otherwise not feasible.          Indeed, in the ICA,

Kellberg asserted that “[t]here is no basis in the record to

conclude that the lot owners could not be joined as a party to

Kellberg’s lawsuit.”      (Internal quotation marks and brackets

omitted).    Moreover, after the circuit court denied Kellberg’s

motion for partial judgment as to Count V, Kellberg moved for

leave to file an amended complaint, which would have added the

lot owners as defendants as to all counts.          The circuit court

granted Kellberg’s Motion to Amend, but Kellberg did not file his

amended complaint because he believed the lot owners “were not

necessary parties to the action.”15

            In short, the record does not establish that joinder of

the lot owners is not feasible.        Because it appears that joinder

is feasible, it must be ordered.16        See HRCP Rule 19(a) (“A

      15
            We note that Kellberg should have filed the amended complaint once
approved by the circuit court. See HRCP Rule 15(a)(2) (2012) (stating that if
a motion to amend a pleading is “granted or allowed, the amended pleading
shall be filed . . . and served forthwith.”).
      16
            Because nothing in the record suggests joinder is infeasible, we
need not reach the second step of the inquiry under Rule 19(b), i.e., whether
                                                                (continued...)

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person who is subject to service of process shall be joined as a

party in the action . . . .       If the person has not been so

joined, the court shall order that the person be made a party.”

(Emphases added)).

            As noted above, the County Defendants argue that the

lot owners are indispensable under Rule 19(b) because the statute

of limitations prevents the circuit court from joining them as

parties.    This argument is without merit because the statute of

limitations is a personal defense that a defendant may waive;

thus, it is unclear at this point whether the lot owners will

even assert it and, if so, whether it will apply.            See Mauian

Hotel v. Maui Pineapple Co., 52 Haw. 582, 569, 481 P.2d 310, 314

(1971) (holding that “the statute of limitations is a personal

defense and a person may waive the benefits of such statute”).

Moreover, Rule 19(a) implies that feasability is determined by

whether a person is subject to service of process, rather than

the likelihood of success on the merits.          See HRCP Rule 19(a) (“A

person who is subject to service of process shall be joined as a

party[.]”).

       16
         (...continued)
the circuit court may decide the case without the lot owners. See Marvin, 127
Hawai#i at 499, 280 P.3d at 97 (holding that the court must proceed to Rule
19(b) only if the non-party meets the requirements under Rule 19(a) and cannot
be joined). If that issue arises, it can be considered by the circuit court
in the first instance on remand.

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           Finally, Kellberg asserts that when he sought to amend

his complaint to add the lot owners, the County Defendants

“objected to their inclusion.”       In opposing the Motion to Amend,

however, the County Defendants did not argue that the lot owners

were not necessary under Rule 19 but instead argued that joining

the lot owners would “unfairly prejudice the County” by causing

additional “costs, expenses, and delays.”         Regardless, the

circuit court granted Kellberg’s motion for leave to amend, but

Kellberg did not file an amended complaint.

           In sum, the ICA vacated the judgment in favor of the

County Defendants and directed that the circuit court enter

judgment in favor of Kellberg based on its conclusion that the

subdivision was invalid.      Because invalidating the subdivision

may impair or impede the lot owners’ respective property rights,

and there is no indication that it is not feasible to join the

lot owners, the ICA should have vacated the circuit court’s

judgment and remanded the case with instructions to order that

the lot owners be joined.      See Life of the Land, 58 Haw. at 298,

568 P.2d at 1194 (holding that “the circuit court’s dismissal of

appellants’ complaint for failure to join indispensable parties

was” in error because after finding that the parties were

necessary under Rule 19(a), “the court should have ordered that

they be made parties”); see also Haiku Plantations Ass’n, 56 Haw.

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at 102, 529 P.2d at 5 (holding that a court was “in no position

to render a binding adjudication” if that ruling could affect a

non-party holding a reversionary interest in the parcel of land

that was the subject of the litigation).

                             IV.   Conclusion

           In conclusion, we vacate the ICA’s judgment, vacate the

circuit court’s judgment, and remand the case to the circuit

court for further proceedings consistent with this opinion.

           Specifically, the circuit court must order that the lot

owners be made parties if feasible pursuant to HRCP Rule 19(a).

If it is not feasible to join the lot owners, the circuit court

must then determine, based on consideration of the factors set

forth in Rule 19(b), whether the action should proceed or should

be dismissed.

Laureen L. Martin               /s/ Mark E. Recktenwald
for petitioners
                                /s/ Paula A. Nakayama
Robert H. Thomas
                                /s/ Sabrina S. McKenna
for respondent
                                /s/ Richard W. Pollack

                                /s/ Colette Y. Garibaldi

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