85 Hawai'i 238, Lester v. Rapp

• Decision Date: 10 June 1997
• Docket Number: No. 16387,16387
• Citation: 942 P.2d 502
• Parties: 85 Hawai'i 238 Velma LESTER, Petitioner-Appellant, v. John J. RAPP, Attorney at Law, Respondent-Appellee, and Michellee LESTER and Patrick R.K. Campos, Appellees, v. Norman LESTER, Petitioner-Appellant, and Martin WOLFF, Appellee/John Rapp, Respondent-Appellee, v. Velma LESTER and Norman Lester, Petitioners-Appellants.
• Court: Hawaii Supreme Court

Page 502

942 P.2d 502

85 Hawai'i 238

Velma LESTER, Petitioner-Appellant, v. John J. RAPP, Attorney at Law, Respondent-Appellee, and Michellee LESTER and Patrick R.K. Campos, Appellees, v. Norman LESTER, Petitioner-Appellant, and Martin WOLFF, Appellee/John Rapp, Respondent-Appellee, v. Velma LESTER and Norman Lester, Petitioners-Appellants.

No. 16387.

Supreme Court of Hawai'i.

June 10, 1997.

Earle Partington, Honolulu, for Petitioner-Appellant Norman Lester.

Richard Pafundi, Honolulu, for Petitioner-Appellant Velma Lester.

John Rapp, appearing pro se.

Before MOON, C.J., LEVINSON, NAKAYAMA and RAMIL, JJ., and Circuit Judge KOCHI, in place of KLEIN, J., recused.

MOON, Chief Justice.

Petitioners-appellants Norman Lester and Velma Lester (collectively, the Lesters) filed a timely application for a writ of certiorari seeking review of the Intermediate Court of Appeals' (ICA) December 17, 1996 memorandum opinion affirming, inter alia, the circuit court's denial of their motion for attorney's fees and sanctions against respondent-appellee John J. Rapp.

On January 6, 1997, this court granted certiorari on the issue of attorney's fees and sanctions. Mr. Rapp filed a supplemental brief on February 5, 1997; the Lesters did not file a supplemental brief. For the reasons set forth below: (1) we remand this matter to the circuit court for a specific determination of whether, in the court's discretion, a sanction of attorney's fees is warranted, and, if so, for the imposition of reasonable attorney's fees against Mr. Rapp and (2) because Mr. Rapp may have engaged in conduct that does not comport with the rules governing professional conduct, we refer this matter to the Office of Disciplinary Counsel (ODC) for its review and any appropriate action.

I. BACKGROUND

Subsequent to a jury trial regarding the disputes between the parties, the jury returned verdicts in favor of, inter alia, Mr. Rapp and against, inter alia, the Lesters. Final Judgment was entered against the Lesters on June 26, 1991 in the amount of $658.00 in actual damages and $100,000.00 in punitive damages. The Lesters timely moved for judgment notwithstanding the verdict (JNOV) or in the alternative, for a new trial or remittitur, but the motion was denied by order on July 24, 1991. The order, however, was subsequently voided and an identical order was filed on August 13, 1992.

Apparently, Mr. Rapp had drafted the original order, opposing counsel approved it as to form and the judge signed it on July 23, 1991. The clerk file-stamped it on July 24, 1991. However, for inexplicable reasons, the original order was not entered into the record, nor was it indexed on the docket sheet. Mr. Rapp apparently received a file-stamped copy; however, it is unclear from the record whether copies were distributed to the other parties. Nevertheless, cognizant of the trial court's ruling, the Lesters appealed to this court. The appeal was dismissed, however, because the order from which the appeal was taken was not contained in the record. Upon reviewing the record, the Lesters' appellate and present counsel (attorney Earle Partington for Norman, attorney Richard Pafundi for Velma) discovered that, indeed, the order was missing.

They sought to resolve the problem by having the judge issue a new order so that they could properly appeal. On July 14, 1992, the Lesters filed "Norman Lester's and Velma Lester's Motion to Void the Purported 'Order Denying Norman and Velma Lester's Motion for Judgment Notwithstanding the Verdict or in the Alternative for a New Trial or Remittitur Filed June 5, 1991' Purportedly filed July 24, 1991 and for Attorney's Fees and Sanctions Against John Rapp."

Unbeknownst to the Lesters, prior to their having filed the motion, Mr. Rapp had, on June 16, 1992, taken his file-stamped July 24, 1991 order out of his files and had either gone to the clerk of the court or sent it with his secretary to have it inserted into the record. Mr. Rapp also enclosed an additional copy of the order in an envelope and had it hand-delivered to Mr. Partington and Mr. Pafundi. He did not identify himself as the delivering party and apparently failed to include a cover letter or certificate of service.

On July 24, 1992, approximately five weeks after Mr. Rapp had caused the order to be inserted, the circuit court entertained oral argument on the Lesters' motion to have the July 24, 1991 order voided and new one entered in its place. At the hearing, the following discussion took place:

[BY MR. RAPP] Mr. Partington is wrong when he represents to the court that this order is not in the file. In the '87 file it's in file 10. In the 1990 case it's in file 6.... It's a perfectly proper order.... [T]here's nothing wrong with the order.... It's in the record now. There's no basis for striking it.

[BY MR. PARTINGTON] I'll just ask, Your Honor, it's in the record now, I'd like to know when and how it got there.... It's not on the docket sheet.... It certainly wasn't in there when we wrote the brief and when I checked several weeks ago.... Now, if it's appeared in the file, I can't account for that....

[THE COURT] At this point, it looks like some sort of clerical error.

....

[MR. PARTINGTON] We have no objection to Your Honor voiding the file stamp and ordering that that order be refiled. We just want to make sure that that order bears the file stamp of now and does not go on appeal bearing a file stamp of 1991 because Mr. Rapp will argue that the appeal is not timely.

....

[MR. RAPP] Judge, there's no error. The order was file stamped July 24, 1991.

This is correct. There's no error to correct. The order was properly entered.

[THE COURT] Well, Mr. Rapp, it might be an error if it's not there though because when I look at the document then I agree with you....

[MR. RAPP] Well, he's wrong. He's wrong. All you got to do is pull out file 10 in the 87 case, and file 6 in the 1990 case and you'll see he's wrong.

[THE COURT] It's in there?

[MR. RAPP] It's in there.

....

[MR. PARTINGTON] Now if this thing is in the file, it's gotten in the file very mysteriously in the last few months, but it's still not on the docket sheet.

....

[THE COURT] Things can mysteriously appear in files, but very difficult to appear on the index though, not impossible. Gentlemen, I do need to look at the volumes cited by counsel. I need to look whether or not it's in the file.

(Emphasis added).

Throughout the court's and opposing counsel's obvious mystification, Mr. Rapp did not disclose that he knew the order had not previously been entered into the record or that the only reason it was now there was because he had caused it to be. Knowing full well that there had been an error insofar as the order had not been entered into the record, he stated to the judge, "Judge, there's no error.... The order was properly entered." Moreover, he did nothing to disabuse the court's concurrence with him that, because the order was file stamped July 24, 1991, if it was in the record, appellate jurisdiction would be properly defeated as untimely. The court took the matter under advisement until it could verify the record.

On August 11, 1992, the court once again heard oral argument on the same motion:

[THE COURT] It appears very clear to this Court, though, that when this matter came on for hearing or at least when this matter was up on appeal before the Supreme Court this Court's order of the 24th of July of 1991 was not in the file nor was it reflected in the index. It appears after the dismissal of the appeal that this order somehow made its way into the file.

[MR. PARTINGTON] We are told by the clerks your Honor, that apparently Mr. Rapp brought it to the Clerk's Office on the 16th of June [1992].... I think there are serious ethical questions involving what was done here....

[THE COURT] Counsel, I'm not in a position to pursue the question of ethical violation.

[MR. PARTINGTON] We would ask that sanctions be imposed in view of my concern at Mr. Rapp's apparent deliberate misrepresentation to the Court last time. Mr. Rapp knew the issue was was this order in the record, and if so, when did it get in the record? From what we have learned from the Clerk's Office, he put it there on the 16th of June, 1992 and yet led this Court to believe this order was not only in the record but in fact had been there all along.

[THE COURT] Thank you. Mr. Rapp?

....

[MR. RAPP] What the Court should do under these circumstances.... There is no question ... [that] the order was sent to the Court and you signed it, and the order was sent down to the Clerk's Office, and it was file stamped July 24, 1991. And we have, we have had some statements without really a foundation by Mr. Partington.... Now he's saying that this order was not entered into the file.... In Schwartz there was an amended complaint that had been submitted to the Court, the Court accepted it, but somehow it did not get into the file folder, but it was clear, just as it's clear here, that the order was ... actually submitted.... Under those circumstances the proper thing to do is to order that it's filed nunc pro tunc back on the original date ..., July 24, 1991.... Now Mr. Partington .... had his remedies.

[MR. PARTINGTON] Your Honor, I have a request that we be permitted to make a record by calling Mr. Rapp as a witness.... [H]e's attempting to perpetrate a fraud upon the court and the other parties by slipping this matter in....

[THE COURT] Well, in any case, Mr. Rapp, was this order placed in the file the 16th of [June]?

[MR. RAPP] I have no direct hand knowledge. I will be glad to tell you Honor what happened.... I never had the original, but I had a file-stamped copy.... I don't know where he gets off saying I went down to the clerk. I did not induce the clerk to do anything. I never talked to the clerk.

[THE COURT] Mr. Rapp, did anyone from your office go down there?

[MR. RAPP] Yes, I sent somebody from my office down with ... a handwritten note and a...