83 Hawai'i 65, Kunewa v. Joshua

• Decision Date: 28 August 1996
• Docket Number: No. 16229,16229
• Citation: 924 P.2d 559
• Parties: 83 Hawai'i 65 Blossom Joshua KUNEWA, Plaintiff-Appellee, and Gladys K. Brash, Lorraine K. Daniel and Doris K. Farm, Plaintiffs, v. Isaac K. JOSHUA, Jr., aka Isaac Kahele Joshua, Jr., Defendant-Appellant.
• Court: Hawaii Court of Appeals

Page 559

924 P.2d 559

83 Hawai'i 65

Blossom Joshua KUNEWA, Plaintiff-Appellee and Gladys K. Brash, Lorraine K. Daniel and Doris K. Farm, Plaintiffs, v. Isaac K. JOSHUA, Jr., aka Isaac Kahele Joshua, Jr. Defendant-Appellant.

No. 16229.

Intermediate Court of Appeals of Hawai'i.

Aug. 28, 1996.

[83 Hawai'i 66] Syllabus by the Court

The circuit court correctly ruled that a defendant exceeded his authority when the defendant used a general power of attorney from his mother to gift substantially all of her property to himself, to the exclusion of his four sisters. The clear and unambiguous language of the power of attorney did not expressly authorize the defendant to make a gift to himself, and we will not construe any broad, all-encompassing grants of power to the defendant under the power of attorney to confer the power to make a gift.

The circuit court properly instructed the jury that it could consider the plaintiff's reasonable attorney fees in computing the amount of punitive damages. The instruction provided objective guidance to the jury in calculating the amount of punitive damages, thus allowing punitive damages to be more accurately measured and decreasing the potential for an arbitrary and abusive punitive damages award. Additionally, the instruction helped to ensure that a plaintiff entitled to punitive damages can be made truly whole as a result of a defendant's wrongful and malicious act.

The circuit court erred, however, in admitting evidence at trial of the defendant's refusal to comply with a partial summary judgment order directing the defendant to return to the administrator of his mother's estate the assets he had wrongfully conveyed to himself. Such evidence was irrelevant to the defendant's state of mind at the time he allegedly committed fraud in conveying his mother's property to himself. Since the jury's award of punitive damages may have been based on the foregoing evidence, we remand this case for a new trial on punitive damages.

Edward Y. N. Kim, Kim & Kim, on the briefs, Honolulu, for defendant-appellant.

Carroll S. Taylor (Taylor, Leong & Chee, of counsel), on the brief, Honolulu, for plaintiff-appellee.

Before BURNS, C.J., WATANABE and HEEN, JJ., RECUSED. ^*

WATANABE, Judge.

This lawsuit arises out of a dispute over whether Defendant-Appellant Isaac K. Joshua, Jr., also known as Isaac Kahele Joshua, Jr. (Defendant), exceeded his authority when he used a general power of attorney from his mother, Rose K. Joshua (Mother), to gift substantially all of Mother's property to himself, to the exclusion of his four sisters, Gladys K. Brash (Gladys), Lorraine K. Daniel (Lorraine), Doris K. Farm (Doris), and Plaintiff-Appellee Blossom Joshua Kunewa (Plaintiff) ¹ (collectively, Sisters).

Defendant appeals from the First Circuit Court's: (1) July 14, 1989 order granting partial summary judgment in Plaintiff's favor, which concluded that Mother's power of attorney did not authorize Defendant to convey Mother's property to himself without consideration and which directed Defendant to hold all property so transferred as constructive trustee for the beneficiaries of Mother's estate (Partial Summary Judgment Order); (2) June 9, 1992 Amended Judgment based upon a special jury verdict, awarding Plaintiff $34,670.10 in special damages and $95,000 in punitive damages (Amended Judgment); and (3) April 26, 1991 Order Denying Defendant's Motion for Reconsideration of [the February 4, 1991 Order Denying] Defendant's Motions for (A) Judgment Notwithstanding the Verdict, (B) Reconsideration of Order Denying Motion for Directed Verdict and (C) New Trial (April 26, 1991 Order).

We (1) affirm the Partial Summary Judgment Order, (2) affirm that part of the Amended Judgment which awarded Plaintiff special damages, vacate that part of the Amended Judgment which awarded Plaintiff punitive damages, and remand for a new trial on the punitive damages issue, and (3) vacate the April 26, 1991 Order.

BACKGROUND

Mother was the widow of Isaac Joshua, Sr. (Father), who died on January 9, 1963. On September 15, 1947, both Mother and Father executed wills, bequeathing their individual estates to the other, and in the event of the death of the survivor, then in equal shares to their five children--Plaintiff, Defendant, Gladys, Lorraine, and Doris.

In 1980, Mother was hospitalized for medical problems. After she was released from the hospital, Mother asked Defendant to take her to an attorney so that she could settle her property and business affairs. On June 26, 1980, Defendant took Mother to see attorney Matthew Pyun (Pyun), a friend of Defendant. At Mother's request, Pyun prepared a document, which Mother subsequently signed, giving Defendant a general power of attorney to manage Mother's affairs (June 26, 1980 power of attorney).

The June 26, 1980 power of attorney, which was recorded at the Hawai'i Bureau of Conveyances on June 27, 1980, read in relevant part, as follows:

ROSE KAPU JOSHUA of 2105 St. Louis Drive, City and County of Honolulu, State of Hawaii [Hawai'i],

have made, constituted and appointed and by these presents do make, constitute and appoint ISAAC KAHELE JOSHUA, JR., of 86-124 Hoaha Street, Waianae [Wai'anae], City and County of Honolulu, State of Hawaii [Hawai'i],

my true and lawful attorney, for me in my name, place and stead, and for my use and benefit with full power and authority to do and perform every act, deed or thing that I might or could do if personally present, including without limitation, the following:

* * * * * *

2. To bargain, contract, purchase, receive and take real property and/or any interests therein and to accept the seizin and possession thereof and the delivery of all deeds, leases, assignments, agreements, options and other conveyance documents thereto, and to rent, lease, sublease, bargain, sell, release, convey, mortgage, hypothecate, and in every manner deal with the real property I now own, and any real property I may hereafter acquire, upon such terms and conditions, and under such covenants as he shall think fit;

3. To bargain and agree for, buy, sell, mortgage, hypothecate and in any and every way and manner deal in and with goods and merchandise, choses in action and other property in possession or in action;

* * * * * *

6. To sign, seal, execute, acknowledge and deliver for me and in my name, and as my act and deed, such deeds, options, grants, leases, assignments, covenants, indentures, agreements, mortgages, hypothecations, bills, checks, bonds, notes, receipts, evidences of debts, and such other The foregoing power of attorney did not contain any language expressly permitting Defendant to make gifts of Mother's property.

[83 Hawai'i 68] instruments in writing of whatever kind and nature as may be necessary or proper in the premises.

Defendant did not use the June 26, 1980 power of attorney to transfer title to any of Mother's property until the summer of 1987. On June 20, 1987, Mother suffered a stroke and was hospitalized. Her treating physician, Dr. Bernard Fong (Dr. Fong), discussed with Defendant and Sisters the possibility of Mother not being able to live beyond the next four days. Dr. Fong also informed Defendant and Sisters that Mother, on the other hand, might have a prolonged recovery, in which case the cost of her care and treatment could consume all of her assets.

After the meeting with Dr. Fong, Defendant decided to use the June 26, 1980 power of attorney to transfer all of Mother's assets to himself. Because Defendant initially could not locate the June 26, 1980 power of attorney, he requested that attorney Blake Okimoto (Okimoto) prepare another power of attorney and have Mother execute it at the hospital.

Upon arrival at Mother's hospital room on June 22, 1987, Okimoto found that Mother "was bedridden and unable to communicate verbally[.]" To determine whether Mother were mentally competent to execute this second power of attorney, Okimoto explained the contents of the power of attorney document to Mother and informed her that if she signed the document, she would be giving Defendant the ability to act on her behalf as to all property that she owned. Okimoto asked Mother to squeeze his hand if she understood what he was explaining to her, and Mother responded by squeezing his hand. Okimoto also asked Mother if it was her desire to convey her property to Defendant, and Mother again squeezed Okimoto's hand.

Because of her physical condition, Mother was unable on her own to sign her name on the power of attorney document. Defendant, therefore, assisted Mother by guiding her hand to the signature line of the document and holding her hand steady as she made an "X" mark. Okimoto, who was also a notary public, then signed and sealed the notarial acknowledgment certificate on the document, thus certifying that Mother had appeared before him and had signed the document as her free act and deed. Okimoto also required Mother to sign her "X" in his notarial record book, ² which contained documentation of all notarial acts performed by Okimoto. Okimoto then had both Defendant and Defendant's wife, Maile Joshua (Maile), sign the power of attorney document as witnesses. He also required Maile and the following individuals, who were present in the hospital room and had witnessed Mother's signing of the power of attorney document, to sign his record book as witnesses to the transaction: Doris, who would later be named as the personal representative of Mother's estate; Lorraine; and Faith Brash, Lorraine's daughter and Mother's granddaughter.

Following Mother's execution of the second power of attorney, Defendant located the original June 26, 1980 power of attorney at the Bureau of Conveyances. Before Mother died on September 9, 1987, Defendant used the original power of attorney to transfer to himself Mother's interest in a lien-free home on St. Louis Drive, some real property on the Big Island, and some real property in California. In...