Ebbtide, LLC v. Hawaiian Ebbtide Hotel, Inc. ( 2024 )

NOT FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER
Electronically Filed
Intermediate Court of Appeals
CAAP-XX-XXXXXXX
10-MAY-2024
07:52 AM
Dkt. 88 SO
NO. CAAP-XX-XXXXXXX
IN THE INTERMEDIATE COURT OF APPEALS
OF THE STATE OF HAWAI‘I
EBBTIDE, LLC., an Oregon limited liability company,
Plaintiff-Appellee/Cross-Appellant,
v.
HAWAIIAN EBBTIDE HOTEL, INC., a Hawaii corporation,
Defendant-Appellant/Cross-Appellee
APPEAL FROM THE DISTRICT COURT OF THE FIRST CIRCUIT
HONOLULU DIVISION
(CASE NO. 1RC181005026)
SUMMARY DISPOSITION ORDER
(By: Nakasone, Presiding Judge, McCullen and Guidry, JJ.)
This is a summary possession case. Defendant-
Appellant/Cross-Appellee Hawaiian Ebbtide Hotel, Inc. (HEH)
appeals from three post-judgment orders entered by the District
Court of the First Circuit's (district court): (1) October 16,
NOT FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER
2018 Order Granting Defendant [HEH's] Motion to Reconsider and
to Set Aside Judgment for Possession and Writ of Possession,
Filed September 24, 2018, and Oral Motion to Dismiss (Order);
(2) October 30, 2018 Order Denying [HEH's] Motion for Attorneys'
Fees and Costs (Attorneys' Fees Order); and (3) November 8, 2018
Order Denying HEH's Motion to Reconsider and/or Set Aside Denial
of [HEH's] Motion for Attorneys' Fees and Costs (Order Denying
Reconsideration).1 Plaintiff-Appellee/Cross-Appellant Ebbtide,
LLC (Ebbtide) cross-appeals from those same three post-judgment
orders.2
HEH argues three points of error on appeal, all which
relate to the district court's denial of attorney's fees. HEH
argues that the district court erred in denying HEH's: (1)
motion for fees and costs; (2) first motion to reconsider/set
aside its denial of HEH's motion for fees and costs; and (3)
second motion to reconsider/set aside its denial of HEH's motion
for fees and costs.3 Ebbtide raises one point of error on
1 The Honorable Michael K. Tanigawa presided.
2 Ebbtide filed its complaint for summary possession, in August
2018, seeking, inter alia, a judgment terminating its lease agreement with
HEH (the Lease), and a writ of possession removing HEH from the subject
property. The operative Lease was the Amended and Restatement of Lease,
entered into on December 21, 2000. The district court entered its Judgment
for Possession and Writ of Possession in September 2018. HEH subsequently
filed its Motion to Reconsider and to Set Aside Judgment for Possession and
Writ of Possession.
3 HEH's Notice of Appeal did not designate the November 23, 2018
Order Denying Defendants' [Second] Motion to Reconsider and/or Set Aside
(continued . . .)
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appeal, arguing that "[t]he District Court erred in its [] Order
in holding that it lacked jurisdiction over the case and thus
granting HEH's Motion to Set Aside Judgment for and Writ of
Possession."
Upon careful review of the record and relevant legal
authorities, and having given due consideration to the arguments
advanced and the issues raised by the parties, we resolve HEH
and Ebbtide's points of error as follows:4
(1) Ebbtide contends that the district court erred in
concluding that it lacked jurisdiction over Ebbtide's summary
possession action. Ebbtide filed its complaint pursuant to
Hawaii Revised Statutes (HRS) § 666-1 (2016),5 which gives the
3 (. . .continued)
Court Order Denying Defendant's Motion to Reconsider and/or Set Aside Denial
of Defendant's Motion for Attorneys' Fees and Costs, as an order being
appealed. We therefore decline to address HEH's third point of error.
Chun v. Bd. of Trs. of Emps. Ret. Sys. of the State of Haw., 92 Hawaiʻi 432,
448, 992 P.2d 127, 143 (2000) (ruling that because appellants "did not, in
. . . their notices of appeal, designate the . . . order as an order from
which an appeal was being taken, they have not properly appealed it.").
4 We review the point of error raised in Ebbtide's cross-appeal
first.
5 HRS § 666-1 states,
Whenever any lessee or tenant of any lands or tenements, or
any person holding under the lessee or tenant, holds
possession of lands or tenements without right, after the
termination of the tenancy, either by passage of time or by
reason of any forfeiture, under the conditions or covenants
in a lease, or, if a tenant by parol, by a notice to quit
of at least ten days, the person entitled to the premises
may be restored to the possession thereof in [the] manner
hereinafter provided.
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district court authority to grant summary possession on the
termination or forfeiture of a lease.
Pursuant to HRS § 604-5(d) (2016), "the district
courts shall not have cognizance of real actions, nor actions in
which the title to real estate comes into question[.]" Id. In
Queen Emma Found. v. Tingco, 74 Haw. 294, 845 P.2d 1186 (1992),
the Hawaiʻi Supreme Court clarified that "HRS chapter 666, the
summary possession statute, was enacted to provide an expedient
remedy to restore a landlord to the possession of his premises
when it is clear that the tenant holds nothing more than a
possessory interest in the property." Id. at 304, 845 P.2d at
1190-91 (emphasis added).
In determining whether a lease involves a question of
title, as opposed to a mere possessory interest, the Tingco
court considered, inter alia, the "anticipated [] long-term
relationship between lessor and lessees, that enabled and
required lessees to build their residences" and construct
"improvements" on the leased land, and that "provide[d] the
lessees with the right to assign and mortgage the lease without
the approval and consent of the lessor." Id. at 301, 845 P.2d
at 1189.
The district court, applying the Tingco factors,
determined,
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with respect to the issue of jurisdiction, I think I do
have to decide that.
I find that –- I looked not only at the term of the
lease, but the –- I mean the duration of the lease, but the
specific terms of the lease, and, honestly, the ability to
mortgage without consent makes it seem very much like
something more than just a possessory interest.
I do not think that there was a conveyance of title
of any kind, but the mortgage without consent was I think
for me the tipping point in addition to the duration of the
lease.
. . . .
THE COURT: The motion to dismiss is granted without
prejudice, since it's just based upon the jurisdiction of
the court, not the merits of the case itself.
We review the district court's jurisdictional ruling
de novo, as a question of law, under the right/wrong standard.
Lingle v. Haw. Gov't Emps. Ass'n, AFSCME, Local 152, AFL-CIO,
107 Hawaiʻi 178, 182, 111 P.3d 587, 591 (2005). Applying this
standard, we conclude that the district court was not wrong in
determining that it lacked jurisdiction because the record
reflects that the Lease conveyed to HEH more than a mere
possessory interest in the subject property.
The Lease granted HEH the right to "assign, mortgage,
pledge, encumber or in any manner transfer [the] lease" without
Ebbtide's prior written consent, subject to certain enumerated
conditions. Moreover, HEH was permitted to and, in some cases,
required to perform "improvements" on the subject property.6
6 Section 6, Maintenance and Repair of Improvements of the Lease
provides, in pertinent part,
(continued . . .)
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Thus, it appears that, as in Tingco, HEH had "marketable
property interests" in the subject property.7 Tingco, 74 Haw. at
301, 845 P.2d at 1189.
We conclude that the district court was not wrong in
determining that the Lease conveyed to HEH more than a mere
possessory interest in the subject property, such that the
district court lacked jurisdiction over Ebbtide's summary
possession action.
6 (. . .continued)
(b) [HEH] shall undertake structural alterations to
the Improvements only for the purpose of keeping the
Improvements in good condition and repair or for the
purpose of erecting new Improvements of equal or higher
fair market value as the existing Improvements . . .
(Emphasis added.)
Section 14, Surrender of the Lease, provides, in pertinent part,
Upon the expiration or earlier termination of the term of
this Lease, all Improvements then located on the Premises
shall, with the Premises, be vacated and surrendered free
of all liens by Lessee to Lessor and shall become the
property of Lessor . . . it nevertheless being understood
that upon expiration or termination, title to the
Improvements shall automatically vest in Lessor by
operation of law and no Lessee's execution of a bill of
sale or assignment requested by Lessor shall in any manner
be deemed a condition precedent to the automatic vesting of
title.
(Emphasis added.)
7 We note that the dispositive issue is whether HEH held property
rights in the land "beyond mere possession," not whether the Lease was
specifically a long-term lease of residential property. Tingco, 74 Haw. at
301, 845 P.2d at 1189.
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(2) HEH contends that the district court erred in
denying attorneys' fees to HEH. In its Attorneys' Fees Order,
the district court stated,
Motion for fees and costs is premature. Dismissal was
without prejudice. No determination was made on the merits
and therefore there is no prevailing party.
We review the district court's denial of attorneys' fees under
the abuse of discretion standard. Chun v. Bd. of Trs. of Emps.'
Ret. Sys. of the State of Haw., 106 Hawaiʻi 416, 431, 106 P.3d
339, 354 (2005).
As the Hawaiʻi Supreme Court has instructed,
[u]sually the litigant in whose favor judgment is rendered
is the prevailing party. Thus, a dismissal of the action,
whether on the merits or not, generally means that
defendant is the prevailing party. There is no requirement
that the judgment in favor of the prevailing party be a
ruling on the merits of the claim.
Wong v. Takeuchi, 88 Hawaiʻi 46, 49, 961 P.2d 611, 614 (1998)
(cleaned up). See also Sheehan v. Grove Farm Co., Inc.,
114 Hawaiʻi 376, 395 163 P.3d 179, 198 (App. 2005) ("The holding
of Wong is clear on its face: any dismissal, regardless of
basis, generally renders the defendant the prevailing party for
purposes of awarding costs (and attorneys' fees).").8
8 In Oahu Publications, Inc. v. Abercrombie, 134 Hawaiʻi 16,
332 P.3d 159 (2014), the Hawaiʻi Supreme Court affirmed the general principle
that "the litigant in whose favor judgment is rendered is the prevailing
party[,]" and "[t]here is no requirement that the judgment in favor of the
prevailing party be a ruling on the merits." Id. at 24, 332 P.3d at 167(internal quotation marks omitted) (quoting Wong, 88 Hawaiʻi at 49, 961 P.2d
at 614). On the facts before it, however, the court concluded that the
appellee was not a "prevailing party" on appeal where the appeal was
dismissed without prejudice to the appellant filing another appeal after a
(continued . . .)
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Pursuant to the controlling caselaw, we conclude that
the district court abused its discretion in declining to address
HEH's fees motion on the erroneous basis that there was no
prevailing party.
For the foregoing reasons, we affirm the district
court's October 16, 2018 Order Granting Defendant [HEH's] Motion
to Reconsider and to Set Aside Judgment for Possession and Writ
of Possession, and we vacate the district court's October 30,
2018 Attorneys' Fees Order and November 8, 2018 Order Denying
Reconsideration. We remand for further proceedings consistent
with this summary disposition order.
DATED: Honolulu, Hawaiʻi, May 10, 2024.
On the briefs:
/s/ Karen T. Nakasone
Dallas Walker Presiding Judge
for Defendant-Appellant/
Cross-Appellee /s/ Sonja M.P. McCullen
Associate Judge
Randolph R. Slaton
Kristi L. Arakaki /s/ Kimberly T. Guidry
for Plaintiff-Appellee/ Associate Judge
Cross-Appellant
8 (. . .continued)
flaw in the judgment was corrected. Id. at 25-26, 332 P.3d at 168-69. The
court reasoned that "the ICA's dismissal of the first appeal did not finally
resolve the . . . case," and "[t]he [appellant] was free to file a second
appeal once the circuit court corrected the judgment[.]" Id. at 25, 332 P.3d
at 168. Here, unlike in Oahu Publications, the district court's dismissal,
on jurisdictional grounds, finally resolved the district court case.
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