Ellis v. Crockett

• Decision Date: 25 February 1969
• Docket Number: No. 4706,4706
• Citation: 451 P.2d 814,51 Haw. 45
• Parties: , 51 Haw. 86 William S. ELLIS, Jr., Florence A. Ellis, Masaru Sumida, Stanley Unten, Charley Shiraishi v. William F. CROCKETT, Lyman T. Harada, Katsuyo Harada, Stephen T. Harada, and William H. Balthis.
• Court: Hawaii Supreme Court

Page 814

451 P.2d 814

51 Haw. 45, 51 Haw. 86

William S. ELLIS, Jr., Florence A. Ellis, Masaru Sumida Stanley Unten, Charley Shiraishi v. William F. CROCKETT, Lyman T. Harada, Katsuyo Harada Stephen T. Harada, and William H. Balthis.

No. 4706.

Supreme Court of Hawai'i.

Feb. 25, 1969.

As Amended and Rehearing Denied March 12, 1969.

Syllabus by the Court 1. General damages, which are not required to be specifically stated pursuant to H.R.C.P., Rule 9(g), are those damages which usually accompany the kind of wrongdoing alleged in the complaint so that the mere allegation of the wrong gives sufficient notice to the opposite party of the kind of damage that will be claimed at trial.

2. H.R.C.R., Rule 9(g), in requiring special damages to be specifically stated, refers to those damages which are of a relatively unusual kind and which, without specific notice to the adversary, may not be understood to be part of the claim.

3. There is no legal injury when a person is induced by false representations to do an act which it is his duty to do.

4. In a claim based upon deceit, while the causal connection between the damages and the deceit need not be alleged with as great precision as might be possible or desirable, the complaint, at a minimum, must adequately notify both the defendant and the court as to the nature of the claimed damages.

5. In order to have a claim based upon deceit, the plaintiff must have suffered actual pecuniary damage.

6. In claim based upon deceit, there may be no recovery for mental anguish and humiliation not intentionally inflicted.

7. Issues which must be raised by way of compulsory conterclaim pursuant to H.R.C.P., Rule 13(a) may not thereafter be raised in an independent action against the same parties who were plaintiffs in the former suit.

8. A plaintiff may not sue a defendant who was at all times acting as agent for a principal against whom a suit is barred because of the compulsory counterclaim requirements where the facts underlying the claims against both are identical.

9. A complaint for fraudulent failure to disclose certain facts is defective if there are not allegations showing that there was a duty on the part of the defendants to make such a disclosure.

10. The defense of collateral estoppel may be raised by a motion to dismiss pursuant to H.R.C.P., Rule 12(b)(6), where it appears from the face of the complaint or from the taking of judicial notice or prior interrelated proceedings which are alluded to in the complaint.

11. Collateral estoppel is an aspect of res judicata which precludes the relitigation of a fact or issue which was previously determined in a prior suit on a different claim between the same parties or their privies.

12. Collateral estoppel precludes relitigation of a fact or issue previously determined when riased defensively by one not a party in a prior suit against one who was a party in that suit and who himself raised and litigated that fact or issue.

13. Although the tort of 'conspiracy' has not been clearly defined, it is clear that there can be no civil claim based upon a conspiracy alone.

14. Where an independent action pursuant to H.R.C.P., Rule 60(b) is brought to relieve a party from a judgment because of a fraud upon the court, the complaint must state with particularity the circumstances constituting the fraud pursuant to Rule 9(b).

15. A plaintiff is entitled under H.R.C.P., Rule 15(a), prior to the serving of a responsive pleading, to amend his complaint for the first time as a matter of right at the time when a court orally grants a motion to dismiss the complaint for failure to state a claim upon which relief could be granted.

Ralph E. Corey, Honolulu, for appellants, except Ellis.

William S. Ellis, Jr., pro se.

William F. Crockett, Crockett & Crockett, Wailuku, Maui, for appellees.

Before RICHARDSON, C. J., MARUMOTO, ABE and LEVINSON, JJ., and KING, Circuit Judge, assigned by reason of vacancy.

LEVINSON, Justice.

The seventeen-page complaint in this case is prolix and ambiguous, sometimes contradictory, and often difficult to comprehend. Although there are numerious allegations of fraud, most of which are stated with particularity as required by the Hawaii Rules of Civil Procedure, Rule 9(b), the complaint as a whole is a gross violation of H.R.C.P., Rule 8(e)(1) which requires that '(e)ach averment of a pleading shall be simple, concise, and direct.' Both rules should be adhered to. The complaint purports to allege five 'causes of action,' an outdated term not used in the Hawaii Rules of Civil Procedure which have been in effect in this jurisdiction since June 14, 1954.

The facts alleged in the complaint appear to be as set forth below:

The controversy developed from the sale of a parcel of land by defendants-appellees Lyman and Katsuyo Harada to the plaintiffs-appellants other than William S. Ellis, Jr., on December 1, 1960. The interest of William S. Ellis, Jr. is alleged to result from his being a creditor of the other plaintiffs-appellants and his having an equitable lien on the land. Prior to the consummaion of the transaction, the vendors 'represented' to the plaintiffs that they would be lenient as to payment of principal and interest due under the the notes and mortgage for the unpaid balance of the purchase price, if the plaintiffs' circumstances so required. They also 'represented' that they would cooperate in an attempt to resolve any problems which might develop. The eventual threats of foreclosure and the ultimate foreclosure are aleged to have been in 'breach' of those 'representations.'

Shortly after the consummation of the sale, the notes and mortgage were assigned to the Bank of Hawaii. Defendant-appellee Balthis, ten an officer of the Bank, notified the plaintiffs of the assignment; but he refused, upon inquiry by plaintiff William S. Ellis, Jr., to divulge the terms of the assignment as between the vendors and the Bank.

One of the two notes for the unpaid balance of the purchase price was paid. However, as time went on, the purchasers became delinquent in making payments due on the remaining note. On several occasions, defendant-appellee Crockett, the attorney for the vendors, demanded full payment of the note pursuant to an acceleration clause and informed the plaintiffs that a foreclosure would follow if the delinquency continued. On these occasions, the plaintiffs were told by Crockett that the vendors were then the owners of the remaining note and the mortgage although at such times the Bank of Hawaii had not as yet reassigned them to the vendors. These threats were alleged to have been made with the 'knowledge and consent' of defendant Balthis.

On one occasion, Crockett secured a purported reassignment of the remaining note and the mortgage, an event which the plaintiffs claim never actually occurred. This was allegedly done for the sole purpose of instigating litigation. One month later, Crockett demanded full payment of the principal and interest to be made within five days after the date of the demand; the demand was alleged to be in breach of the acceleration clause, which provded for thirty days' notice.

There is one other defendant-appellee as yet unmentioned. He is Stephen T. Harada, the son of the vendors. The plaintiffs claim that he and all the other defendants 'falsely and fraudulently' failed to disclose (1) who actually held the note and mortgage on the day Crockett demanded the accelerated payment, and (2) who had instructed Crockett to initiate the foreclosure proceedings which followed.

The foreclosure proceeding was instituted by the vendors, and it resulted in the granting of summary judgment in favor of the vendors. That judgment was appealed and was affirmed by this court in an unreported opinion. It is now claimed that some of the sworn statements made by one or more of the present defendants, except S. Harada, and which were relied upon by the court in the granting of summary judgment were false and made with the intent to deceive the court.

The complaint in this case was filed on September 3, 1966. On September 21, 1966, the defendants moved for dismissal of the entire action pursuant to Rule 12(b)(6) on the ground that the complaint failed to state a claim upon which relief could be granted. The motion was orally granted on February 3, 1967, at which time the plaintiffs asked for permission to amend the complaint. The permission was summarily denied. On February 9, 1967, an order of dismissal without leave to amend was filed. Subsequent motions for rehearing and for an amended order of dismissal were denied, and an appeal was taken to this court.

The only questions before us that we consider necessary to answer are: (1) whether the motion to dismiss was properly granted, and (2) if so, whether, under H.R.C.P., Rule 15(a), the plaintiffs had a right to file an amended complaint after the trial court orally granted the motion to dismiss and before the order was filed. Other specifications of error, except the specification numbered 4, which is premature for decision, are without merit.

1. The Granting of the Motion to Dismiss

We agree with the lower court that none of the alleged 'causes of action' states a claim on which relief may be granted.

A. 'First Cause of Action'

(1) The pleadings

The alleged 'first cause of action' was against all the defendants for deceit, conspiracy to deceive, instigation of litigation, and conspiracy to instigate litigation, culminating in the filing of the mortgage foreclosure action. It is alleged that the acts of the defendants resulted in 'grievous mental suffering and substantial prejudice, harm, and damage, which Plaintiffs estimate and allege amounts to the sum of $100,000.'

The claim based upon instigation of litigation and a conspiracy to instigate litigation is without merit. Appellants have cited no authority in this jurisdiction supporting a claim based on such grounds. Nor have they presented any...