O'Grady v. State.

***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
Electronically Filed
Supreme Court
SCAP-14-0001363
27-SEP-2017
08:21 AM
IN THE SUPREME COURT OF THE STATE OF HAWAIʻI
---O0O---
MICHAEL PATRICK O’GRADY, individually; and
LEILONI O’GRADY, individually,
Petitioners/Plaintiffs-Appellants,
vs.
STATE OF HAWAIʻI and
STATE OF HAWAIʻI DEPARTMENT OF TRANSPORTATION,
Respondents/Defendants-Appellees,
and
THE COUNTY OF HAWAIʻI; HAWAIIAN ELECTRIC COMPANY;
HAWAIIAN ELECTRIC LIGHT COMPANY; HAWAIIAN ELECTRIC
INDUSTRIES, INC.; HULU LOLO, INC.; and DOES 1-100, inclusive,
Defendants.
SCAP-14-0001363
APPEAL FROM THE CIRCUIT COURT OF THE THIRD CIRCUIT
(CAAP-14-0001363; CIV. NO. 07-01-0372)
SEPTEMBER 27, 2017
RECKTENWALD, C.J., McKENNA, POLLACK, AND WILSON, JJ., AND
CIRCUIT COURT JUDGE CRABTREE, IN PLACE OF NAKAYAMA, J., RECUSED
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
OPINION OF THE COURT BY POLLACK, J.
I. INTRODUCTION
After this court filed its opinion in O’Grady v.
State, No. SCAP-14-0001363, 2017 WL 2464970 (Haw. June 7, 2017),
Michael Patrick O’Grady and Leiloni O’Grady (collectively, the
O’Gradys or Petitioners) moved for an award of attorney’s fees
in the amount of $15,842.14 and costs in the amount of
$4,815.17, pursuant to sections 662-9 and 662-12 of the Hawaii
Revised Statutes (HRS) and Hawaiʿi Rules of Appellate Procedure
(HRAP) Rule 39, against the State of Hawaiʿi (State) and the
State of Hawaiʿi Department of Transportation (DOT)
(collectively, Respondents). We grant the O’Gradys’ request for
costs but deny their request for attorney’s fees.
II. DISCUSSION
A. Attorney’s fees under HRS §§ 662-9 and 662-12
The O’Gradys contend that this court has the
discretion to award attorney’s fees pursuant to HRS § 662-9
(2016) and HRS § 662-12 (2016). Respondents oppose the
O’Gradys’ request for attorney’s fees, arguing that under HRS §
662-12, “there must be a judgment in favor of Petitioners
against the State,” and that “there has been no judgment” in
this case. Thus, Respondents assert that the O’Gradys’ request
for attorney’s fees is “at best, premature.” Further,
2
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
Respondents contend that the fees requested cannot be awarded as
sanctions because “the State was not the appealing party.”
Our analysis commences with the statutory
interpretation of HRS § 662-9 and HRS § 662-12. “Statutory
interpretation is a question of law reviewable de novo.” Boyd
v. Haw. State Ethics Comm’n, 138 Hawaii 218, 224, 378 P.3d 934,
940 (2016). The established canons of statutory interpretation
advise us to begin with the plain-language interpretation of the
provisions of the statute at issue, bearing in mind that
“implicit in the task of statutory construction is our foremost
obligation to ascertain and give effect to the intention of the
legislature, which is to be obtained primarily from the language
contained in the statute itself.” Id. (quoting Estate of Roxas
v. Marcos, 121 Hawaii 59, 66, 214 P.3d 598, 605 (2009)). A
court may examine other sources, including a statute’s
legislative history, in order to “discern the underlying policy
[that] the legislature sought to promulgate” in the enactment of
the statute. State v. Abel, 134 Hawaii 333, 339, 341 P.3d 539,
545 (2014) (alteration in original) (quoting State v. McKnight,
131 Hawaii 379, 388, 319 P.3d 298, 307 (2013)).
HRS § 662-9 states as follows: “In an action under
this chapter, court costs and fees as set by law may be allowed
to the prevailing party.” HRS § 662-9 (emphasis added). HRS §
3
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
662-9 thus allows an award of “fees,” which includes attorney’s
fees. See Fee, Black’s Law Dictionary (10th ed. 2014) (defining
“fee” as “[a] charge or payment for labor or services, esp.
professional services” and includes “attorney’s fees”). The
amount of fees awarded by a court, however, must be determined
as “set by law.” HRS § 662-9. Accordingly, while HRS § 662-9
provides discretionary authority to the courts to award fees to
the prevailing party, the allowable amount and the manner in
which such fees is to be calculated are governed by another
source of law. See id. HRS § 662-12, entitled “Attorney’s
fees,” of the State Tort Liability Act is a statute that “set[s]
by law” the manner in which attorney’s fees may be determined
and awarded by a court under HRS § 662-9. See State v.
Alangcas, 134 Hawaii 515, 527, 345 P.3d 181, 193 (2015) (“Laws
in pari materia, or upon the same subject matter, shall be
construed with reference to each other. . . . .” (quoting State
v. Kamanao, 118 Hawaii 210, 218, 188 P.3d 724, 732 (2008))).
In pertinent part, HRS § 662-12 reads as follows:
The court rendering a judgment for the plaintiff pursuant
to this chapter . . . may, as a part of such judgment, . .
. determine and allow reasonable attorney’s fees which
shall not, however, exceed twenty-five per cent of the
amount recovered and shall be payable out of the judgment
awarded to the plaintiff; provided that such limitation
shall not include attorney’s fees and costs that the court
may award the plaintiff as a matter of its sanctions.
HRS § 662-12.
4
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
HRS § 662-12 provides courts with discretionary
authority to “determine and allow reasonable attorney’s fees,”
and it also governs the allowable amount of attorney’s fees
(“twenty-five per cent of the amount recovered”) and the manner
in which it may be awarded to the plaintiff (“payable out of the
judgment awarded”) subject to an exception (if the fees are “a
matter of . . . sanctions”). HRS § 662-12. Reading HRS § 662-
12 in pari materia with HRS § 662-9, when the plaintiff is the
prevailing party in a suit brought under the State Tort
Liability Act, the court rendering a judgment for the plaintiff
may, pursuant to HRS § 662-12, allow reasonable attorney’s fees
not to exceed twenty-five percent of the amount recovered and
payable out of the judgment awarded to the plaintiff. HRS §§
662-9, 662-12.1
This interpretation is supported by Levy v. Kimball,
51 Haw. 540, 465 P.2d 580 (1970), which interpreted HRS § 662-
12, and by the amendments to HRS § 662-12 that the legislature
enacted subsequent to our decision in Levy. At the time that
1
The limitation as to the amount of allowable attorney’s fees and
the manner in which attorney’s fees may be awarded, however, does not apply
if such fees are being awarded as sanctions. We also note that HRS § 662-12
applies only when the court is “rendering a judgment for the plaintiff.”
Thus, where the State is the prevailing party under HRS § 662-9, HRS § 662-12
does not “set by law” the amount of awardable attorney’s fees or the manner
in which such fees may be awarded, as this statute only applies to the
plaintiff; in such a situation, there must be another statute that
independently “set[s] by law” the attorney’s fees that may be awarded to the
State as the prevailing party. See HRS § 662-9.
5
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
Levy was decided, HRS § 662-12 provided as follows: “The court
rendering a judgment for the plaintiff pursuant to this chapter
. . . may, as a part of such judgment, award, or settlement,
determine and allow reasonable attorney’s fees which shall not,
however, exceed twenty per cent of the amount recovered.” 51
Haw. at 543, 465 P.2d at 582 (quoting HRS § 662-12 (1968)). The
State in Levy argued that the phrase “as a part of such
judgment” in HRS § 662-12 implied that the attorney’s fees
awarded under the statute would be paid out of the judgment, not
in addition to it. Id. Rejecting the argument, this court held
that “HRS § 662-12 authorizes the trial court to award an
attorney’s fee up to 20 per cent of the judgment, in addition to
the judgment and not out of the judgment.” Id. at 546, 465 P.2d
at 584.
After Levy was decided, the legislature amended HRS §
662-12 in 1979, as follows:
Attorney’s fees. The court rendering a judgment for the
plaintiff pursuant to this chapter or the attorney general
making a disposition pursuant to section 662-11 may, as a
part of such judgment, award, or settlement, determine and
allow reasonable attorney’s fees which shall not, however,
exceed [twenty] twenty-five per cent of the amount
recovered and shall be payable out of the judgment awarded
to the plaintiff; provided that such limitation shall not
include attorney’s fees and costs that the court may award
the plaintiff as a matter of its sanctions.
1979 Haw. Sess. Laws Act 152, §4 at 333.2
2
The Act, as it appears in the 1979 Session Laws, was not Ramseyer
formatted (i.e., repealed statutory material is bracketed and stricken and
(continued . . .)
6
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
The original House Bill--H.B. 1634, H.D. 1, 10th Leg.
Reg. Sess. (1979)--“would have repealed section 662-12 . . . on
the theory that such repeal would discontinue the present
practice by judges of allowing attorney’s fees in addition to
judgments awarded in favor of plaintiffs.” S. Stand. Comm. Rep.
No. 861, in 1979 Senate Journal, at 1389. The accompanying
House Standing Committee Report explains:
Your Committee heard testimony that because the 20% award
is made over and above the judgment, it is 20% higher than
would be made against any other defendant. Your Committee
feels that there is no reasonable basis for such a
differentiation and finds that the disallowance of such an
award is desirable and necessary.
H. Stand. Comm. Rep. No. 619, in 1979 House Journal, at
1434.
The Senate Standing Committee amended the House Draft
“to make attorney’s fees payable out of judgments awarded to
plaintiffs, thus treating the problem more directly,” and this
change was confirmed by the Conference Committee.3
(. . . continued)
new statutory material is underscored), as was authorized by the 1978 version
of HRS § 23G-16.5 (providing that “[w]henever, in any Act, statutory material
to be repealed is bracketed and new material is underscored as a matter of
bill drafting style, the revisor, in printing the Act, need not include the
brackets, the bracketed material, or the underscoring). To clearly
illustrate the 1979 amendments, Ramseyer formatting was supplied to the block
quote.
3
See S. Stand. Comm. Rep. No. 861, in 1979 Senate Journal, at
1389, see H.B. 1634, H.D. 1, S.D. 1, 10th Leg. Reg. Sess. (1979); Conf. Comm.
Rep. No. 62, in 1979 Senate Journal, at 981; Conf. Comm. Rep. No. 60, in 1979
House Journal, at 1115.
7
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
The 1979 amendment and its accompanying committee
reports reflect that the legislature intended to reverse Levy’s
holding that fees under HRS § 662-12 would be awarded in
addition to the judgment. Thus, the language of HRS § 662-12,
as it stands today, permits an award of attorney’s fees, but the
fee award of the court must not exceed twenty-five percent of
the amount recovered and must be paid from the proceeds of the
judgment, not in addition to it.4
The United States District Court for the District of
Hawaii recently reached the same result in Kauhako v. State of
Hawaii Board of Education Department of Education, Civil No. 13-
00567 DKW-KJM, 2016 WL 7365206 (D. Haw. Nov. 28, 2016), adopted
by No. CV 13-00567 DKW-KJM, 2016 WL 7362835 (D. Haw. Dec. 19,
2016). After looking at the 1979 amendments to HRS § 662-12,
the district court held that the statute permits an award of
fees payable out of the judgment, not in addition to it. Id. at
*5. Under the circumstances, it declined to award attorney’s
4
HRS § 662-12 does not require a court to award attorney’s fees,
and a decision not to do so may be particularly appropriate when there is an
attorney-client fee agreement exceeding the statutory amount or the presence
of other reasons not to award fees. See Kauhako v. State of Haw. Bd. of
Educ. Dep’t of Educ., Civil No. 13-00567 DKW-KJM, 2016 WL 7365206 (D. Haw.
Nov. 28, 2016), adopted by No. CV 13-00567 DKW-KJM, 2016 WL 7362835 (D. Haw.
Dec. 19, 2016) (recommending that the district court deny attorneys’ fee
award under HRS § 662-12 because the award would come out of and not be added
to the judgment); Viveiros v. State, 54 Haw. 611, 614, 513 P.2d 487, 489-90
(1973) (affirming trial court’s denial of awarding attorney’s fees under HRS
§ 662-12).
8
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
fees to the plaintiff because doing so would only apportion the
judgment without “increas[ing] the net result to the moving
party.” Id.
The O’Gradys, on the other hand, suggest an
interpretation of HRS § 662-9 that would allow recovery of
attorney’s fees in full, in addition to the judgment. According
to the O’Gradys, so long as they are the “prevailing part[ies]”
within the meaning of that phrase under HRS § 662-9, they can
recover the full amount of their attorney’s fees under HRS
§ 662-9 without regard to the restrictions and limitations in
HRS § 662-12. This interpretation disregards the words “as set
by law” in HRS § 662-9 and the specific provisions in HRS § 662-
12 regarding recovery of attorney’s fees. In particular, the
O’Gradys’ interpretation not only would allow parties to claim
attorney’s fees in addition to the judgment, it would also
circumvent the amount of attorney’s fees that may be awarded by
a court in suits brought under the State Tort Liability Act.
Further, the O’Gradys’ position would bypass the statutory
revisions made by the legislature through the 1979 amendment to
HRS § 662-12.
The O’Gradys also contend that they can recover the
full amount of their attorney’s fees “as a sanction” under HRS §
662-12. However, the exclusion in HRS § 662-12 that pertains to
“sanctions” means that, if sanctions were to be awarded pursuant
9
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
to another legal authority, then it must be specifically
excluded from the statutory amount that a court may award
pursuant to HRS § 662-12. See HRS § 662-12. HRS § 662-12, by
itself, does not provide sufficient grounds for awarding
attorney’s fees “as sanctions,” and the O’Gradys do not identify
any authority that would permit this court to award attorney’s
fees as sanctions.5
We therefore conclude that HRS § 662-9 allows a court
to award attorney’s fees only to the extent permitted under HRS
§ 662-12. Consequently, we evaluate the O’Gradys’ request for a
court award of attorney’s fees pursuant to the parameters of HRS
§ 662-12.6
5
This conclusion is supported by the legislative history of the
1979 amendment to HRS § 662-12. The Conference Committee exempted
“sanctions” from the application of the twenty-five-percent cap and the
requirement that the attorney’s fees be awarded from the judgment awarded to
plaintiffs because “it is necessary that the authority of the court to award
sanctions against the Attorney General and his staff should not be negated by
implication.” Conf. Comm. Rep. No. 62, in 1979 Senate Journal, at 981—82;
Conf. Comm. Rep. No. 60, in 1979 House Journal, at 1115. The Conference
Committee noted that “sanctions are to be allowed similarly as against all
other party litigants whenever unreasonable conduct by the Attorney General
or his staff is deemed by the court to have unfairly required accrual of
attorney’s fees and costs by the opposing party.” Conf. Comm. Rep. No. 62,
in 1979 Senate Journal, at 981—82; Conf. Comm. Rep. No. 60, in 1979 House
Journal, at 1115. Thus, the legislature, in amending HRS § 662-12,
recognized that the courts already had a preexisting power to impose
sanctions pursuant to various other laws, and the exception for “sanctions”
included in the 1979 amendment to HRS § 662-12 simply acknowledged that power
and structurally conformed HRS § 662-12 with that power so that the statute
would not conflict or implicitly negate that power. HRS § 662-12, therefore,
did not create an independently sufficient authority for a court to award
attorney’s fees as sanctions.
6
The holding in this case is based upon our analysis of HRS §§
662-9 and 662-12 and does not address other statutory provisions or
applicable law allowing an award of attorney’s fees against the State.
10
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
B. The O’Gradys’ request for recovery of attorney’s fees under
HRS §§ 662-9 and 662-12 is premature
As discussed, in a suit brought under the State Tort
Liability Act, HRS §§ 662-9 and 662-12 permit a “court rendering
a judgment for the plaintiff” to “determine and allow reasonable
attorney’s fees” to the “prevailing” plaintiff, but the fees
awardable by a court may not exceed twenty-five per cent of the
amount that the plaintiff recovered and must be paid “out of the
judgment awarded to the plaintiff.” HRS §§ 662-9 (2016), 662-12
(2016).
Accordingly, the first issue for this court to address
regarding the O’Gradys’ request for attorney’s fees is whether
this court’s judgment on appeal in O’Grady v. State, No. SCAP-
XX-XXXXXXX, 2017 WL 2464970 (Haw. June 7, 2017), is a “judgment
for” the O’Gradys under HRS § 662-12. Generally, “[a] judgment
is the final action of a court, which disposes of the matter
before it.” Inter-Island Resorts, Ltd. v. Akahane, 44 Haw. 93,
96, 352 P.2d 856, 859 (1960); accord Final Judgment, Black’s Law
Dictionary (10th ed. 2014) (defining “final judgment” as “[a]
court’s last action that settles the rights of the parties and
disposes of all issues in controversy”).
We have discussed the concept of a judgment “for” a
party, as a requirement for fee-shifting, in Nelson v.
University of Hawaii, 99 Hawaii 262, 54 P.3d 433 (2002). In
11
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
Nelson, the petitioner sought appellate attorney’s fees pursuant
to HRS § 378-5(c) (1993),7 after this court vacated a circuit
court judgment favoring the defendant university and remanded
the case for a new trial. Id. at 264, 54 P.3d at 435. HRS §
378-5(c) directs an award of attorney’s fees for “any judgment
awarded” to an employment discrimination plaintiff. HRS § 378-
5(c). After looking to HRS § 378-5 as a whole, the Nelson court
held that “the phrase ‘judgment awarded to the plaintiff’ refers
generally to favorable relief or damages that follow as a result
of a finding that the defendant engaged in discriminatory
practice.” Nelson, 99 Hawaii at 266, 54 P.3d at 437.
Consequently, this court denied the request for attorney’s fees
because the judgment on appeal “merely vacate[d] a trial court
judgment unfavorable to the plaintiff and place[d] the plaintiff
back where [she] started.” Id.HRS § 662-12 is substantially similar to HRS § 378-
5(c), the fee-shifting statute at issue in Nelson. Read as a
whole, HRS § 662-12 provides that an award of attorney’s fees
may be paid out of (1) “a judgment for the plaintiff,” or (2) an
7
HRS § 378-5(c) provides as follows:
In any action brought under this part, the court, in
addition to any judgment awarded to the plaintiff or plaintiffs,
shall allow costs of action, including costs of fees of any
nature and reasonable attorney’s fees, to be paid by the
defendant.
12
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
“award” or “settlement” pursuant to alternative resolution of
the case under HRS § 662-11 (2016).8 All of these dispositions
of a case involve the payment of damages to the plaintiff
pursuant to a determination (or admission) that the State is
liable in tort. The language of HRS § 662-12 thus indicates
that “a judgment for the plaintiff” must, at minimum, order
payment of damages or other favorable relief in favor of the
plaintiff. See Nelson, 99 Hawaii at 266, 54 P.3d at 437.
In this case, the judgment on appeal will vacate the
circuit court’s judgment and remand the case for further
proceedings. We stated in our opinion that the circuit court
“misapprehended the relevant standard for evaluating legal
causation” and clarified the correct test. O’Grady, 2017 WL
2464970, at *1. Accordingly, we instructed the circuit court to
determine, on remand, “whether the State’s breach of its duty
was the legal cause . . . of the O’Gradys’ injuries” by applying
the analytical standard set forth in our opinion. Id. at *13.
It follows that we did not ourselves determine the question of
8
HRS § 662-11 provides:
(a) The attorney general may arbitrate, compromise,
or settle any claim cognizable under this chapter.
(b) Claims arbitrated, compromised, or settled by the
attorney general for $10,000 or less shall be paid from the
state risk management revolving fund. Claims arbitrated,
compromised, or settled by the attorney general for more
than $10,000 shall be paid only after funds are
appropriated by the legislature for the payment of those
claims.
13
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
legal causation. Neither did we resolve whether the O’Gradys
had established their negligence claim against the State nor
order the State to pay damages to the O’Gradys. Like the
plaintiff in Nelson, our judgment in this case merely returns
the O’Gradys to a prior position in the proceedings, and the
judgment therefore “does not, in itself, provide any grounds for
an award of fees” to the O’Gradys. Nelson, 99 Hawaii at 266, 54
P.3d at 437. Thus, we hold that the O’Gradys’ request for
attorney’s fees under HRS § 662-12 is premature because there
has been no judgment for the O’Gradys in this case.9 See id.
C. Appellate costs pursuant to HRAP Rule 39
The O’Gradys argue that they are entitled to costs
pursuant to HRAP Rule 39. The O’Gradys maintain that, when a
judgment is vacated, HRAP Rule 39(a) enables courts to tax costs
at their discretion, that HRAP Rule 39(d) enables courts to tax
costs against the State “if an award of costs is authorized by
9
Because, at the outset, we conclude that the request for
attorney’s fees is premature, it is not necessary to consider arguments
regarding the quantum or reasonableness of fees to which the O’Gradys contend
they are entitled. Similarly, we do not need to resolve Respondents’
argument pertaining to the applicability of this court’s opinion in DFS Group
L.P. v. Paiea Properties, which held “that the twenty-five per cent limit [in
HRS § 607-14] does not apply in cases that involve ‘only an adjudication of
rights in which no monetary liability is in issue.’” 110 Hawaii 217, 221,
131 P.3d 500, 504 (2006) (quoting Food Pantry, Ltd. v. Waikiki Bus. Plaza,
Inc., 58 Haw. 606, 621, 575 P.2d 869, 880 (1978)). Finally, the O’Gradys
assert that, since the ultimate damage award is unknown at this stage, any
attorney’s fees immediately awarded would be an offset from the fees
ultimately awarded. The O’Gradys do not provide any authority to support
this contention, and we do not address it in light of our disposition.
14
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
law,” and that HRAP Rule 39(c) provides a definition for
“appellate costs.”
Respondents, on the other hand, assert that HRAP Rule
39(b), which governs “Costs for and against the State of
Hawaiʿi,” applies in this case rather than HRAP Rule 39(a).
Therefore, Respondents argue that “there must be some other law
authorizing costs against the State under the circumstances.”
Respondents then note that the O’Gradys “do not cite to any
specific law that expressly authorizes the award of costs
against the State.” In the alternative, if the court holds that
HRAP Rule 39(a) applies, Respondents request this court to
decline to award appellate costs because “[i]n this case
[Respondents] neither participated in inappropriate conduct
below nor filed a frivolous appeal.”
The construction of a court rule is subject to de novo
review. In re Ishida-Waiakamilo Legacy Tr., No. SCWC-13-
0000449, 2017 WL 2590870, at *4 (Haw. June 15, 2017). HRAP Rule
39(b) provides:
(b) Costs for and against the State of Hawaiʿi. In
cases involving the State of Hawaiʿi or an agency or officer
thereof, if an award of costs against the State is
authorized by law, costs shall be awarded in accordance
with the provisions of this Rule; otherwise costs shall not
be awarded for or against the State of Hawaiʿi, its
agencies, or its officers acting in their official
capacities.
HRAP Rule 39(b) (2016). Therefore, as to costs, the first issue
is whether the O’Gradys have identified a law that authorizes an
15
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
award of costs against the State of Hawaiʿi. If so, HRAP Rule
39(b) directs that the provisions of HRAP Rule 39 apply as they
ordinarily would. See Oahu Publ’ns, Inc. v. Abercrombie, 134
Hawaiʿi 16, 24 n.5, 332 P.3d 159, 167 n.5 (2014) (holding that
HRAP Rule 39(a) would apply where requesting party cited statute
authorizing recovery of “reasonable attorney’s fees and all
other expenses”).
The O’Gradys seek costs pursuant to HRS § 662-9, which
states that, “[i]n an action under [the State Tort Liability
Act], court costs and fees as set by law may be allowed to the
prevailing party.” HRS § 662-9 (2016). Respondents challenge
the source of authority that the O’Gradys identified, arguing
that HRS § 662-9 does not itself permit an award of costs
against the State but merely implies that “there must be some
other law” authorizing the award of such costs. Respondents
argue that, since the O’Gradys do not cite any such law, costs
should not be awarded.
Under HRAP Rule 39(b), costs must be “authorized by
law.” HRAP Rule 39(b) reiterates the general rule that costs
cannot be awarded against the State of Hawaiʿi unless there is a
“clear relinquishment” of the State’s sovereign immunity. See
Nelson v. Hawaiian Homes Comm’n, 130 Hawaii 162, 168, 307 P.3d
142, 148 (2013) (“[A]n award of costs and fees to a prevailing
party is inherently in the nature of a damage award.
16
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
Accordingly, to properly award . . . costs against [the State] .
. ., there must be ‘a clear relinquishment’ of the State’s
immunity in this case.” (first and third alterations in
original) (footnote omitted) (citation omitted)). Thus, there
must be a law that clearly relinquishes the State’s sovereign
immunity from court costs and authorizes an award of such costs.
HRAP Rule 39(b); Nelson, 130 Hawaii at 168, 307 P.3d at 148.
This court has previously established “that the State
has waived immunity to suit . . . to the extent as specified in
HRS chapter[] . . . 662.” Nelson, 130 Hawaii at 169, 307 P.3d
at 149 (footnote omitted) (quoting Taylor–Rice v. State, 105
Hawaii 104, 110, 94 P.3d 659, 665 (2004)). The plain language
of HRS § 662-9 specifically grants a court discretion to award
“court costs . . . as set by law . . . to the prevailing party.”
Thus, HRS § 662-9 clearly relinquishes the State’s immunity from
court costs awardable to prevailing parties in suits brought
under the State Tort Liability Act. Id. As such, HRS § 662-9
“authorize[s] by law” the award of court costs under HRAP Rule
39(b).
Respondents misapprehend the plain language of HRS §
662-9 in arguing that HRS § 662-9, by itself, is not sufficient
to “authorize by law” the award of costs under HRAP Rule 39(b).
Contrary to Respondents’ position, the phrase “as set by law” in
17
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
HRS § 662-9 is not fundamentally equivalent to the phrase “as
authorized by law” in HRAP Rule 39(b).
As relevant to this case, the ordinary signification
of the word “authorize” is “[t]o give legal authority” or “to
empower.” Authorize, Black’s Law Dictionary (10th ed. 2014);
see State v. Guyton, 135 Hawaii 372, 378, 351 P.3d 1138, 1144
(2015) (“In conducting a plain meaning analysis, ‘this court may
resort to legal or other well accepted dictionaries as one way
to determine the ordinary meaning of certain terms not
statutorily defined.’” (quoting State v. Pali, 129 Hawaii 363,
370, 300 P.3d 1022, 1029 (2013))). In contrast, to “set” means
“to fix or decide on as a time, limit, or regulation”; “to fix
at a certain amount”;10 to “[p]ut or bring into a specified
state”; or to “[f]ix (a price, value, or limit) on something.”11
Thus, while HRAP Rule 39(b) requires some law that
gives legal authority or empowers an appellate court to award
costs to a plaintiff who prevails in a suit brought under the
State Tort Liability Act, HRS § 662-9 provides that the quantum
of costs that may be awarded under the statute must be regulated
and fixed by law and may not exceed the limits to the amount
10
Set, Merriam-Webster, https://www.merriam-
webster.com/dictionary/set (last visited Aug. 17, 2017).
11
Set, English Oxford Living Dictionaries,
https://en.oxforddictionaries.com/definition/set (last visited Aug. 17,
2017).
18
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
that the applicable law prescribes. Therefore, HRS § 662-9
fulfills the requirement in HRAP Rule 39(b) that “an award of
costs against the State is authorized by law,” but the manner in
which costs is computed and awarded is informed and regulated by
other applicable law. HRS § 662-9; HRAP Rule 39(b).
Further, reading HRS § 662-9 in pari materia with HRAP
Rule 39(b), the provisions of Rule 39 “set[s] by law”--i.e.,
regulates and limits--the amount of costs that can be awarded to
a prevailing plaintiff in a suit brought under the State Tort
Liability Act. HRS § 662-9; HRAP Rule 39(b). HRAP Rule 39(b)
states that “if an award of costs against the State is
authorized by law, costs shall be awarded in accordance with the
provisions of this Rule.” Because HRS § 662-9 “authorize[s] by
law” the award of costs in this case, the provisions of HRAP
Rule 39 control the amount of awardable costs and the
evidentiary burden that must be satisfied in order to be
entitled to such costs. HRAP Rule 39(b). This is consistent
with our conclusion that the phrase “as set by law” in HRS §
662-9 means that the computation and amount that may be awarded
as costs against the State must be limited by other governing
law, which, in this case, are the relevant provisions of HRAP
Rule 39.
This interpretation is further supported by the
decision in Educators Ventures, Inc. v. Bundy, 3 Haw. App. 435,
19
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
652 P.2d 637 (1982). Pursuant to HRS § 467-16 (1976), the
circuit court in that case ordered the payment of $10,000 from
the real estate recovery fund to each of the plaintiffs for
damages, court costs and fees, and attorney’s fees. Id. at 436—
37, 652 P.2d at 638. HRS § 467-16 provided that persons
aggrieved by the acts of a licensed real estate broker or
salesman
may recover by order of the circuit court or district court
of the county where the violation occurred, an amount of
not more than $10,000 for damages sustained by the fraud,
misrepresentation, or deceit, including court costs and
fees as set by law, and reasonable attorney fees as
determined by the court.
HRS § 467-16 (emphasis added). The ICA affirmed the circuit
court’s award and held that the 10,000-dollar limit in HRS §
467-16 applied not only to damages and court costs and fees, it
applied equally to attorney’s fees. Educators Ventures, Inc., 3
Haw. App. at 437, 652 P.2d at 638. Although the phrase “set by
law” appears in HRS § 467-16, the ICA affirmed the circuit
court’s award and did not look to other statutes or legal
authority that would independently permit the circuit court’s
award to the plaintiffs. See id. at 437—41, 652 P.2d at 638—40.
Implicit in the ICA’s opinion is that HRS § 467-16 sufficed to
empower the circuit court to render an award that included
“court costs and fees as set by law.” See id. This is
consistent with our determination in this case that HRS § 662-9
provides authority to this court to award costs and that the
20
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
phrase “as set by law” does not mean that another statute or
legal source must independently allow for the award of costs
against the State. We therefore conclude that HRS § 662-9
“authorize[s] by law” the award of costs against Respondents in
this case, and the amount of awardable costs and the manner in
which such costs can be awarded are “set by law” by the
provisions of HRAP Rule 39.
In light of the foregoing, we proceed to the
determination of whether the O’Gradys are entitled to costs
pursuant to HRAP Rule 39(b) and HRS § 662-9. Under HRS § 662-9,
“costs . . . may be allowed to the prevailing party.” HRS §
662-9’s requirement is mirrored by the intent underlying HRAP
Rule 39: “to allow the party prevailing on appeal to recover
those costs reasonably incurred in prosecuting the appeal.” Jou
v. Argonaut Ins. Co., 133 Hawaii 471, 477, 331 P.3d 449, 455
(2014) (quoting Leslie v. Estate of Tavares, 93 Hawaii 1, 7, 994
P.2d 1047, 1053 (2000)). Thus, the O’Gradys may be awarded
costs only if they are the prevailing party in their appeal to
this court. Nelson, 130 Hawaii at 165, 307 P.3d at 145 (“The
first step in analyzing whether Plaintiffs are entitled to
attorneys’ fees (and costs) is to determine whether they are the
‘prevailing party.’”). The O’Gradys argue that they prevailed
on the main disputed issue in the appeal--“whether the circuit
21
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
court erred in deciding that the State was not the cause of the
O’Grady’s [sic] injuries”--because this court vacated the
circuit court’s judgment in favor of the State on the issue of
causation. Hence, the O’Gradys assert that they were the
“prevailing party” in the appeal and are entitled to costs under
HRS § 662-9.
“The ‘prevailing party’ is the one who “prevails on
the disputed main issue.” Nelson, 130 Hawaii at 165, 307 P.3d
at 145 (quoting Food Pantry, Ltd. v. Waikiki Bus. Plaza, Inc.,
58 Haw. 606, 620, 575 P.2d 869, 879 (1978)). In determining
which party prevailed on the disputed main issue on appeal, a
court can compare the relief sought with the relief awarded.
Jou, 133 Hawaii at 477, 331 P.3d at 455. But “[e]ven if the
party does not prevail ‘to the extent of his original
contention, he will be deemed to be the successful party for the
purpose of taxing costs.’” Nelson, 130 Hawaii at 165, 307 P.3d
at 145 (quoting Food Pantry, Ltd., 58 Haw. at 620, 575 P.2d at
879).
The disputed main issues on appeal were (1) whether
“the circuit court erred in holding that the State’s breach of
its duty of care was not a legal cause of the [O’Gradys’]
injuries” and (2) whether the discretionary function exception
applied in this case. O’Grady v. State, No. SCAP-14-0001363,
22
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
2017 WL 2464970, at *1 (Haw. June 7, 2017). This court held
that the circuit court “misapprehended the relevant standard for
evaluating legal causation,” id., by requiring the O’Gradys to
prove factual and legal matters that are not relevant to
determining the existence of legal causation, id. at *9—13.
Additionally, we held that “the State ha[d] not established that
it [was] relieved from liability under the discretionary
function exception with regard to the duty recognized by the
circuit court.” Id. at *17. Thus, we vacated the second
amended judgment and remanded the case to the circuit court for
further proceedings consistent with the opinion. Id. at *18.
In light of the issues raised on appeal, our
conclusions with respect to each of them, and our disposition in
this case, the O’Gradys were the “prevailing part[ies].”12 See
Nelson, 130 Hawaii at 166, 307 P.3d at 146 (concluding that the
plaintiffs were the prevailing parties because this court held
that “the political question doctrine did not bar determination”
of certain substantive issues underlying the case, affirming on
12
The relief that the O’Gradys requested was for this court to
“reverse the circuit court’s judgment in favor of the State, and render
judgment in the O’Gradys’ favor.” This court, on the other hand, vacated the
judgment and remanded the case for further proceedings. The fact that the
relief requested and the relief awarded are not the same does not change the
conclusion that the O’Gradys were the prevailing parties on appeal: the
vacatur of the circuit court’s judgment, although short of what the O’Gradys
requested, is still favorable for the O’Gradys. Nelson, 130 Hawaii at 165,
307 P.3d at 145.
23
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
narrower grounds the ICA’s vacatur of the circuit court’s
decision predicated on the political question doctrine).
Having concluded that HRS § 662-9 authorizes the award
of costs against the State in this case and that the O’Gradys
are the prevailing parties under HRS § 662-9, we now determine
the amount of costs that can be awarded “in accordance with the
provisions of . . . Rule [39].” HRAP Rule 39(b). Because this
court vacated the circuit court’s judgment and remanded the case
for further proceedings, the amount that may be awarded to the
O’Gradys is set by law in HRAP Rule 39(a): “if a judgment . . .
is vacated, . . . the costs shall be allowed only as ordered by
the appellate court.” In situations where the circuit court’s
judgment is vacated, “courts have routinely ordered an award of
appellate costs to the party that prevailed on the main disputed
issue on appeal.” Jou, 133 Hawaii at 479, 331 P.3d at 457.
Costs, for the purposes of Rule 39, include “the cost
of the original and one copy of the reporter’s transcripts if
necessary for the determination of the appeal; . . . the fee for
filing the appeal; [and] the cost of printing or otherwise
producing necessary copies of briefs and appendices, provided
that copying costs shall not exceed 20¢ per page.” HRAP Rule
39(c). In substantiating a request for costs, “where
appropriate, copies of invoices, bills, vouchers, and receipts”
shall be attached as support. HRAP Rule 39(d)(1).
24
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
Insofar as Respondents do not make “a specific
objection” to the O’Gradys’ itemized cost request--and the State
in fact asks this court to award the full amount of requested
costs if we find that the O’Gradys are entitled to costs--we
grant in full the costs that the O’Gradys request in the amount
of $4,815.17.13 Wong v. Takeuchi, 88 Hawaii 46, 53, 961 P.2d
611, 618 (1998) (“Unless there is a specific objection to an
expense item, the court ordinarily should approve the item.”
(quoting Lewis, Wilson, Lewis & Jones, Ltd. v. First Nat’l Bank
of Tuscumbia, 435 So.2d 20, 23 (Ala. 1983))); accord Haw.
Ventures, LLC v. Otaka, Inc., 116 Hawaii 465, 480, 173 P.3d
1122, 1137 (2007).
III. CONCLUSION
In a suit brought under the State Tort Liability Act,
the authority of the court to award attorney’s fees to a
prevailing plaintiff under HRS § 662-9 is defined and bounded by
the provisions of HRS § 662-12. The O’Gradys’ request for
attorney’s fees is premature under HRS §§ 662-9 and 662-12
13
The costs that the O’Gradys seek consist of (1) $4,416.36 for
thirteen transcripts, all of which were “necessary for the determination of
the appeal” as they contain relevant testimony from witnesses at the trial
pertinent to this court’s holding on the merits of this case, see HRAP Rule
39(c), and supported by invoices for the transcripts and the corresponding
checks that their counsel paid, see HRAP Rule 39(d)(1); (2) filing fees in
the amount of $315.00, which are allowed under HRAP Rule 39(c)(3); and (3)
photocopying costs in the amount of $86.81, which is allowed and complies
with the 20 cents per page limitation under HRAP Rule 39(c)(4).
25
***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***
because there has been no “judgment for” them within the meaning
of that phrase in HRS § 662-12. As to costs, we conclude that
HRS § 662-9 authorizes by law the award of fees to a prevailing
plaintiff but that the awardable amount, the manner in which the
amount may be requested and the award made, and the
documentation necessary to support the request are governed by
the relevant provisions of HRAP Rule 39. We award the O’Gradys
costs in the amount of $4,815.17 pursuant to HRS § 662-9 and
HRAP Rule 39 because the O’Gradys were the “prevailing party on
appeal,” and the State did not lodge specific objections to any
of the expense items included in the O’Gradys’ request for
costs.
Ronald G. Self and /s/ Mark E. Recktenwald
Rebecca A. Copeland
for petitioners /s/ Sabrina S. McKenna
Douglas S. Chin, /s/ Richard W. Pollack
Caron M. Inagaki, and
Robin M. Kishi /s/ Michael D. Wilson
for respondents State of
Hawaii and State of Hawaii /s/ Jeffrey P. Crabtree
Department of Transportation
26