Educators Ventures, Inc. v. Bundy, 7299

• Decision Date: 18 October 1982
• Docket Number: No. 7299,7299
• Citation: 652 P.2d 637,3 Haw.App. 435
• Parties: EDUCATORS VENTURES, INC. and Hawaii Education Association, Plaintiffs-Appellants, v. Gwendolyn Florence BUNDY, Defendant, and Real Estate Commission of the State of Hawaii, Defendant-Intervenor-Appellee.
• Court: Hawaii Court of Appeals

Page 637

652 P.2d 637

3 Haw.App. 435

EDUCATORS VENTURES, INC. and Hawaii Education Association Plaintiffs-Appellants, v. Gwendolyn Florence BUNDY, Defendant and Real Estate Commission of the State of Hawaii Defendant-Intervenor-Appellee.

No. 7299.

Intermediate Court of Appeals of Hawai'i.

Oct. 18, 1982.

Syllabus by the Court

1. Under HRS § 467-16, recovery by an aggrieved person from the real estate recovery fund is limited to $10,000, including reasonable attorney fees.

2. The fundamental objective in construction of statutes is to ascertain and give effect to the intention of the legislature.

3. Where the language of the statute in question is ambiguous or of doubtful meaning, judicial construction and interpretation are warranted.

4. If the statute as punctuated does not reflect what is otherwise indicated to be the true legislative purpose, in order to effectuate such purpose the punctuation may be disregarded, transposed or the statute may be repunctuated.

5. Where there is doubt or doubleness of meaning in a statute, ambiguity exists.

6. In case of ambiguity, courts may resort to extrinsic aids in the construction of a statute. Courts may take legislative history into consideration in construing a statute.

7. Reference to other analogous statutes with similar language and dealing with similar subject matter may be helpful in the interpretation of a doubtful statute.

Paul Alston, Shelby Anne Floyd, James T. Paul and Jeffrey S. Grad, Honolulu (Paul, Johnson & Alston, and Jeffrey S. Grad, Law Corp., Honolulu, of counsel), on briefs for plaintiffs-appellants.

Sidney K. Ayabe, Honolulu (Libkuman, Ventura, Ayabe & Hughes, Honolulu, of counsel), on brief for defendant-intervenor-appellee.

Before BURNS, C.J., and HEEN and TANAKA, JJ.

TANAKA, Judge.

Pursuant to Hawaii Revised Statutes (HRS) § 467-16 (1976), plaintiffs-appellants sought payment from the real estate recovery fund (Fund) of a portion of an unsatisfied judgment previously obtained against defendant Gwendolyn Florence Bundy (Bundy) plus attorney fees incurred in obtaining the judgment. The lower court ordered payment from the Fund of $10,000 to each plaintiff, but denied any additional payment therefrom for attorney fees. ¹ Plaintiffs appeal from the denial of additional payment for attorney fees.

HRS § 467-16 provides in pertinent part as follows:

The real estate commission shall establish and maintain a real estate recovery fund from which any person aggrieved by an act, representation, transaction, or conduct of a duly licensed real estate broker, or real estate salesman, upon the grounds of fraud, misrepresentation, or deceit, 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.

The only issue before us is whether, under HRS § 467-16, the recovery by an aggrieved person is limited to $10,000 including reasonable attorney fees or $10,000 plus reasonable attorney fees.

We construe HRS § 467-16 to mean $10,000 including reasonable attorney fees and affirm.

On October 3, 1977, plaintiffs obtained a judgment against Bundy, a licensed real estate salesperson, in the sum of $397,794.58, including punitive damage of $100,000.00. The judgment was based on a jury's special verdict which found that in a real estate investment transaction, Bundy had made false representations which plaintiffs relied upon and that Bundy had breached an agreement entered into with plaintiffs. Subsequently, on December 8, 1977, the court awarded plaintiffs costs of $9,731.93, including statutory attorneys' commission of $8,069.86.

Plaintiffs sought to satisfy the judgment by various post-judgment procedures without success.

On September 12, 1978, plaintiffs filed a motion seeking recovery from the Fund pursuant to HRS § 467-18. ² The Real Estate Commission of the State of Hawaii (Commission), administrator of the Fund, intervened. On November 13, 1978, the lower court entered an order directing payment of $10,000 to each of the plaintiffs from the Fund. The order further provided that the $10,000 maximum specified in HRS § 467-16 "was intended to include any amount of compensation awarded for attorneys' fees." Plaintiffs' appeal followed.

I.

The rules of statutory construction applied in this jurisdiction were summarized in In Re Hawaiian Telephone Company, 61 Haw. 572, 608 P.2d 383 (1980). Our supreme court stated:

The fundamental objective in construction of statutes is to ascertain and give effect to the intention of the legislature. The intention of the legislature is to be obtained primarily from the language contained in the statute itself. Accordingly, a basic tenet of statutory interpretation is that where the language of the law in question is plain and unambiguous, construction by this court is inappropriate and our duty is only to give effect to the law according to its plain and obvious meaning. On the other hand, where the language of a statute is ambiguous or of doubtful meaning, or where literal construction of the statute would produce an absurd or unjust result, clearly inconsistent with the purposes and policies the statute was designed to promote, judicial construction and interpretation are warranted and also the court may resort to extrinsic aids to construction.

Id. at 577-578, 608 P.2d at 387 (citations omitted).

Paradoxically, both plaintiffs and the Commission claim that the language of HRS § 467-16 is unambiguous, but arrive at opposite results.

The crucial words in HRS § 467-16 involved in the case are "an amount of not more than $10,000 for damages ..., including court costs and fees as set forth by law, and reasonable attorney fees as determined by the court." Plaintiffs argue that the presence of the comma before the last phrase results in a plain meaning of $10,000 for damages, including costs and fees as set forth by law, plus reasonable attorney fees as determined by the court. On the other hand, the Commission contends that the "placement of the comma is not necessarily indicative of legislative intent." If the presence of the comma is ignored, HRS § 467-16 clearly means $10,000 for damages, including costs and fees as set forth by law and including reasonable attorney fees.

A treatise on statutory construction provides:

[P]unctuation is a part of the act and ... it may be considered in the interpretation of the act but may not be used to create doubt or to distort or defeat the intention of the legislature. When the intent is uncertain, punctuation, if it affords some indication of the true intention, may be looked to as an aid.

On the other hand, if the act as originally punctuated does not reflect what is otherwise indicated to be the true legislative purpose, in order to effectuate such purpose the punctuation may be disregarded, transposed, or the act may be repunctuated.

2A C. Sands, Sutherland Statutory Construction, § 47.15, at 98 (4th ed. 1973) (footnotes omitted).

We do not believe that the placement of a comma in HRS § 467-16 should be determinative of the intent of the legislature in its enactment. The presence of the comma has caused a doubt as to the meaning of HRS § 467-16. Where there is "doubt" or "doubleness of meaning," an ambiguity exists. State v. Sylva, 61 Haw. 385, 388, 605 P.2d 496, 498 (1980). Due to such ambiguity, we resort to extrinsic aids to the construction of HRS § 467-16. See State v. Tavares, 63 Haw. 509, 630 P.2d 633 (1981); In Re Hawaiian Telephone Company, supra.

II.

"Courts may take legislative history into consideration in construing a statute." Life of the Land v. City & County, 61 Haw. 390, 447, 606 P.2d 866, 899 (1980); Kamanu v. E.E. Black, Ltd., 41 Haw. 442 (1956). We will resort to legislative history to construe HRS § 467-16 in light of legislative intent.

In 1967, the legislature authorized and directed the Commission to establish the Fund. ³ The purpose of the 1967 act was "to furnish financial protection to the consumer public when dealing with real estate brokers and salesmen by providing a fund which, under certain circumstances, will satisfy unpaid judgments against real estate brokers and salesmen." The funds necessary to carry out this purpose were to "be provided by real estate brokers and salesmen without undue burden to them." Senate Stand.Comm.Rep. No. 882, 4th Hawaii Leg., Reg.Sess., reprinted in Senate Journal 1233, 1234 (1967); House Stand.Comm.Rep. No. 700, 4th Hawaii Leg., Reg.Sess., reprinted in House Journal 745 (1967) (emphasis added). To limit the burden imposed on real estate brokers and salesmen, section 170-15 of the act (now HRS § 467-16) provided that an aggrieved person may recover "an amount of not more than ten thousand dollars for damages," and section 170-23 (now HRS § 467-24) stated that the liability of the Fund "shall not exceed twenty thousand dollars ($20,000) for any one licensee." ⁴

In 1976, HRS § 467-16 was amended to specifically allow recovery of court costs and fees and reasonable attorney fees from the Fund. ⁵ The legislative reason for the amendment was as follows:

Under existing law any person aggrieved by an act, representation, transaction or conduct of a duly licensed real estate broker or salesman upon grounds of fraud, misrepresentation or deceit may recover by court order from the real estate recovery fund an amount not more than $10,000 for damages sustained by such fraud, misrepresentation or deceit. No specific statutory provisions provide for recovery of court costs and fees and attorney fees. This bill would allow recovery for these items of cost from the real estate recovery fund.

Senate Stand.Comm.Rep. No. 747-76, 8th Hawaii Leg., Reg.Sess., reprinted in Senate Journal 1210 (1976). Similar language is found in House Stand.Comm.Rep. No....