Honolulu Federal Sav. and Loan Ass'n v. Pao

• Decision Date: 17 August 1983
• Docket Number: Nos. 8304,8406,s. 8304
• Court: Hawaii Court of Appeals
• Parties: HONOLULU FEDERAL SAVINGS AND LOAN ASSOCIATION, a federal savings and loan association, Plaintiff-Appellee, v. Nicholas R. PAO, Mabel Pao, Leonard F. Calistro, and Catherine Calistro, Defendants-Appellees, Hawaii Thrift & Loan, Incorporated, a Hawaii corporation, and Amfac Financial Corp., a Hawaii corporation, Defendants, and Maikailoa Ventures, Purchaser-Appellant.

Page 50

668 P.2d 50

4 Haw.App. 478

HONOLULU FEDERAL SAVINGS AND LOAN ASSOCIATION, a federal

savings and loan association, Plaintiff-Appellee, v. Nicholas R. PAO, Mabel Pao, Leonard F. Calistro, and Catherine Calistro, Defendants-Appellees,

Hawaii Thrift & Loan, Incorporated, a Hawaii corporation,

and Amfac Financial Corp., a Hawaii corporation, Defendants,

and

Maikailoa Ventures, Purchaser-Appellant.

Nos. 8304, 8406.

Intermediate Court of Appeals of Hawai'i.

Aug. 17, 1983.

Syllabus by the Court

1. For purposes of appeal, a foreclosure case is divided into two appealable parts. The first part is the decree of foreclosure. The second part includes all other orders which are appealable upon the entry of the last of the series of orders which collectively embrace the entire controversy. In case of a deficiency, the last and final order is the deficiency judgment.

2. The remedy sought in an equitable action is addressed to the sound discretion of the trial court. The granting of equitable relief will not be overturned on review unless the appellate court is convinced that the trial court abused its discretion.

3. Waiver means an intentional or voluntary relinquishment of, or refusal to use, a right. To constitute a waiver, there must have existed a right claimed to have been waived and the waiving party must have had knowledge, actual or constructive, of the existence of such right at the time of the purported waiver.

4. A stipulation made inadvertently, inadvisedly, or improvidently should not be permitted to be withdrawn by the court when the other party will be prejudiced thereby.

5. The general rule is that an appellant is precluded from raising for the first time on appeal a question which was not presented in the trial court, unless justice otherwise requires.

John R. Lacy, Honolulu (Goodsill Anderson & Quinn, Honolulu, of counsel), for purchaser-appellant.

Brian P. Aburano, Honolulu (William H. Gilardy, Jr. and Michiro Iwanaga, Honolulu, on brief, Burke, Ashford, Sakai, McPheeters, Bordner & Gilardy, Honolulu, of counsel), for plaintiff-appellee.

V. Spencer Page, Honolulu, for defendants-appellees Nicholas R. Pao, Mabel Pao, Leonard F. Calistro, and Catherine Calistro.

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

TANAKA, Judge.

Maikailoa Ventures (MV), a Hawaii general partnership, the purchaser at a mortgage foreclosure sale, appeals the lower court's order denying its motion to rescind the sale and forfeiting its $100,000 partial payment of the purchase price. We affirm.

The issues on appeal are (1) whether the lower court erred in holding that MV waived its right to rescind and agreed to the forfeiture and (2) whether the lower court abused its discretion in decreeing forfeiture of the entire $100,000. We answer no to both questions.

On January 11, 1978, plaintiff Honolulu Federal Savings and Loan Association (Honfed) initiated an action to foreclose a mortgage made by defendants Nicholas R. Pao, Mabel Pao, Leonard F. Calistro, and Catherine Calistro (collectively the mortgagors). The mortgage covered 3.668 acres of land (property) adjacent to the Haleiwa Beach Park in Waialua, Oahu, and secured a promissory note for $600,000.

On August 1, 1978, the court entered its order granting Honfed's motion for summary judgment and for a decree of foreclosure. Danny Graham (Graham) was appointed the commissioner to sell the property.

After delays for various reasons, Graham sold the property to MV ¹ for the highest bid price of $910,000 at a public auction held on May 23, 1980. As required, a deposit of $50,000 was made.

By an order filed on August 18, 1980, the court extended the closing date. The court required, inter alia, (1) the closing to be on or before October 19, 1980, (2) partial payments by MV of $50,000 by July 21, 1980 and $210,000 by September 5, 1980, and (3) the forfeiture of all deposits and payments if the sale was not consummated on or before the closing date. By an order filed on August 20, 1980, the court confirmed the sale.

On September 4, 1980, MV's counsel Roy M. Kodani (Kodani) filed a motion which sought to have the closing date and the payment date for the $210,000 extended until Graham was ready to deliver a 25-foot easement or, in the alternative, a rescission of the sale and a return of the $100,000 already paid to Graham. In his affidavit attached to the motion, Kodani stated that (1) in publicizing the sale, Graham represented that the property "is accessed by Kahalewai Place" which is 25 feet wide; (2) MV relied upon such representation; and (3) after the judicial sale, it was discovered that the property is "land locked" and that "there is no 25 feet wide access right-of-way extending from the subject property to Kamehameha Highway."

Anticipating that the sale to MV would not close as scheduled, Honfed filed a motion on September 5, 1980 requesting the court to authorize a new sale of the property.

On September 11, 1980, the court heard both motions. Based on the representations of the attorneys present at the hearing, the court granted an extension of 90 days ² on the condition that MV secure the payment of $210,000. Unfortunately, no written order evidencing the court's rulings was filed. ³

On December 5, 1980, Mervyn W. Lee, a new attorney for MV, filed a motion for rescission and for a refund of the $100,000 payment. The basis of the motion was the lack of the 25-foot access easement and misrepresentation by Graham. On the same day, Honfed filed its motion seeking a new sale and sanctions against MV and two of its partners.

Both motions were heard on December 11, 1980. By an order filed on January 29, 1981, the court (1) approved the "Order Extending Closing Date and Establishing Further Security" prepared by William H. Gilardy, Jr. (Gilardy), counsel for Honfed, and attached as Exhibit "A" to Honfed's December 5, 1980 motion; (2) declared the $100,000 paid by MV to be forfeited; (3) canceled the sale to MV; and (4) ordered Graham to conduct a new sale.

In the interim, on January 16, 1981, John R. Lacy (Lacy), the third attorney for MV, filed a motion to intervene ⁴ to assert MV's claim for reimbursement of the $100,000. At the hearing held on January 29, 1981, the court orally denied the motion since the $100,000 had already been declared forfeited. This ruling is included in the order filed on March 30, 1981.

On March 16, 1981, Lacy moved for reconsideration of the January 29, 1981 order forfeiting MV's $100,000 which was denied on April 21, 1981. On May 19, 1981, MV filed its notice of appeal.

In the interim, at a judicial sale held on January 19, 1981, Graham sold the property to Feung Jung Huang or nominee for $760,000. This sale was confirmed by the court in its order filed on March 30, 1981.

On July 13, 1981, a deficiency judgment of $164,116.82 was entered against the mortgagors. MV filed its second notice of appeal on August 12, 1981 and an amended notice of appeal on August 13, 1981.

I.

We first address the issue of appellate jurisdiction. Both Honfed and the mortgagors contend that, as to certain orders from which MV appeals, its notices and amended notice of appeal were untimely. For example, they claim that the May 19, 1981 notice of appeal was too late as to the January 29, 1981 order which, inter alia, forfeited the $100,000. We disagree.

Hoge v. Kane, 4 Haw.App. 246, 663 P.2d 645 (1983), is dispositive of this issue. In Hoge, we stated:

For purposes of appeal, foreclosure cases are bifurcated into two, not three or more, separately appealable parts.... The first part is the decree of foreclosure ....

The second part includes all other orders. With rare exception, all other orders are appealable upon the entry of the last of the series of orders which collectively embrace the entire controversy.... In foreclosure cases which result in a deficiency, the last and final order which starts the clock running is usually the deficiency judgment.

Id. at ---, 663 P.2d at 646-47 (footnotes and citations omitted).

Here, the appeal clock began running on July 13, 1981 when the deficiency judgment was filed. The August 12, 1981 notice of appeal, as amended on August 13, 1981, brought up on appeal all pertinent orders entered since the filing of the August 1, 1978 order granting Honfed's motion for summary judgment and for an interlocutory decree of foreclosure.

II.

In essence, MV argues that (1) the property purchased by it lacked a 25-foot access easement to a public highway; (2) if it waived its right to rescind the sale in consideration of a 90-day extension of time and agreed to forfeit the $100,000 already paid, such waiver was conditioned upon its obtaining the 25-foot access easement; (3) the easement was not acquired; and (4) thus, the court erred in failing to grant its motion for rescission and a refund of the $100,000. We disagree.

A.

Initially, we address the question of the applicable standard of review. MV claims that, inasmuch as the lower court's actions were based on certain findings of facts made by it, the "clearly erroneous" standard is applicable. Honfed argues that the "abuse of discretion" standard must be applied.

MV challenges the "findings" in the "Order for a New Sale" filed on January 29, 1981. However, the numbered paragraphs therein were orders and not findings of fact. MV also refers to the "findings" in the "Order Denying Motion of Maikailoa Venturers [sic] for Reconsideration of Order that Maikailoa Venturers [sic] Forfeit $100,000" filed on April 21, 1981. However, they too were not proper findings of fact under Rule 52(a), Hawaii Rules of Civil Procedure (HRCP) (1981). Rule 52(a) concerns findings in an action "tried upon the facts without a jury or with an advisory jury." In the instant case, there was no evidentiary hearing and the "findings" were a result of oral representations made to the court by the parties' attorneys. Thus, the Rule 52(a) "clearly erroneous" standard is not...