MDG Supply, Inc. v. Diversified Investments, Inc.
| Decision Date | 17 November 1969 |
| Docket Number | No. 402,No. 4818,No. 401,401,402,4818 |
| Citation | 463 P.2d 525,51 Haw. 375 |
| Parties | , 51 Haw. 479 MDG SUPPLY, INC., a Hawaii corporation, Plaintiff-Appellee, v. DIVERSIFIED INVESTMENTS, INC., a Hawaii corporation, Glenn H. Simons, Jr., and Catherine C. Simons, Defendants-Appellants. (Civil) MAUI CONCRETE & AGGREGATES, INC., a Hawaii corporation, MDG Supply, Inc., a Hawaii corporation, and Credit Associates of Maui, Ltd., a Hawaii corporation, Plaintiffs-Appellees, v. DIVERSIFIED INVESTMENTS, INC., a Hawaii corporation, Defendant-Appellant. (Civil) |
| Court | Hawaii Supreme Court |
Syllabus by the Court
1. Once compromise and settlement agreement is embodied in consent judgment, it cannot be rescinded unilaterally; so, notice of such rescission is properly struck from record.
2. Judgment of foreclosure of mortgage or other lien is final, since it determines merits of controversy, even though attorneys' fees are left to be determined subsequent to foreclosure sale, such determination being merely an incident to enforcement of such judgment.
3. Circuit court retains jurisdiction to enforce appealed judgment subsequent to filing of notice of appeal, unless supersedeas bond is filed under H.R.C.P. Rule 62(d).
William S. Ellis, Jr., appellant pro se, for the petition.
Ralph E. Corey, Honolulu, for all other appellants.
B. Martin Luna, Wailuku (Ueoka & Vail, Wailuku, of counsel), for appellees.
Before RICHARDSON, C. J., and MARUMOTO, ABE, LEVINSON and KOBAYASHI, JJ.
The parties presently concerned with this appeal are the trustees in dissolution of Diversified Investments, Inc., as appellants, and MDG Supply, Inc., as appellee. Originally, Kula Development Corporation and William S. Ellis, Jr., had also joined as appellants. But they have withdrawn after considerably muddying the record.
Stripped of all immaterial matters, the ultimate question for decision on this appeal is the validity of the Amended Order Appointing Commissioners and Ordering Sale of Real Property, entered by the second circuit court on September 9, 1968, in Civil Nos. 401 and 402.
The material facts are as follows:
On December 27, 1965, the circuit court entered a judgment relative to Civil No. 401 and the second claim in Civil No. 402, which provided:
(a) With respect to Civil No. 401, that Diversified owed MDG $8,010.04, as of December 31, 1965, which was secured by Mechanics Lien No. 52 on Lot 2 (tax map key 2-3-20:11), area 4.05 acres, in Kula, Maui, owned by Diversified; that the mechanics lien be foreclosed by the sale of Lot 2 at public auction conducted by commissioners appointed by the court; and that the reasonable fees for MDG's attorneys, and the costs of foreclosure, including the commissioners' fees, be determined at a hearing on the confirmation of foreclosure sale.
(b) With respect to the second claim in Civil No. 402, that Diversified owed MDG $34,381.02 on December 31, 1965, which was secured by a mortgage on Lot 2, and also on Lot 4 (tax map key 2-3-20:9), area 0.74 acre, owned by Diversified; and that the mortgage be foreclosed by the sale of Lots 2 and 4 in the same manner and with the same requirements regarding the determination of attorneys' fees and costs of foreclosure as in Civil No. 401.
Simultaneously with the entry of the judgment, the court entered an order to stay its enforcement until December 31, 1967, and providing that MDG may have it The judgment and the stay order were entered pursuant to a stipulation for their entry contained in a document entitled 'Compromise and Settlement Agreement' filed the same day. The document was signed by attorney for MDG and attorney for Diversified, Kula Development Corporation, William S. Ellis, Jr., and two other persons, Glenn H. Simons, Jr., and Catherine C. Simons. It provided that it was made 'unconditionally and without reservation whatsoever other than that contained herein.'
enforced upon ex parte motion after the expiration of the period of stay.
The reservations contained in the document, pertinent to this appeal, were (1) that the undertakings of the parties therein were to be construed solely as a compromise resolution of the issues in Civil No. 401 and the second claim in Civil No. 402, without the necessity of trial, and not to be construed as an admission or waiver of claims, counterclaims, or defenses by Diversified, Kula Development Corporation, or William S. Ellis, Jr., with respect to parties other than MDG in Civil No. 402; and (2) that costs advanced and reasonable attorneys' fees payable to MDG's attorneys for services rendered with respect to Civil No. 401, the second claim in Civil No. 402, and Mechanics Lien No. 52 were to be determined after the entry of the judgment and stay order, with the right reserved in Diversified to appeal from such determination.
Diversified did not pay the amounts owing to MDG under the judgment within the period of the stay. Instead, on December 30, 1967, one day before the expiration of the stay, it filed a document entitled 'Notice of Rescission,' in which it purported to inform MDG of its rescission of the compromise and settlement agreement. To this notice, MDG interposed a motion to strike. The circuit court granted the motion on September 3, 1968.
On August 22, 1968, MDG moved for enforcement of the judgment, with notice to Diversified. Diversified opposed. On September 3, 1968, the court granted the motion, and entered an order entitled 'Order Appointing Commissioners and Ordering Sale of Real Property.' This order directed the sale of Lot 4 at public auction by the commissioners appointed therein. Diversified filed notice of appeal from this order, and also from the order granting MDG's motion to strike its notice of rescission, on September 6, 1968. Three days later, on September 9, 1968, MDG obtained from the circuit court, upon ex parte motion without notice to Diversified, an amended order appointing commissioners and ordering sale of real property. The amended order substituted Lot 2 for Lot 4 as the property to be sold. Diversified filed an amended notice of appeal on September 19, 1968, in which it listed the amended order, as well as the original order appointing commissioners and ordering sale of real property and the order striking its notice of rescission, as the adjudications appealed from.
On October 18, 1968, during the pendency of this appeal, Diversified was dissolved as a corporation. This court duly substituted its trustees in dissolution as appellants.
Upon the foregoing facts, we shall consider the points relied upon by appellants on this appeal.
The first point relied upon is that the circuit court abused its discretion, and thereby committed reversible error, in striking Diversified's notice of rescission of the compromise and settlement agreement. This point is not only without any merit whatsoever but is in fact frivolous.
The notice merely set forth Diversified's crass and unilateral decision to repudiate an agreement under which it had bought two years' time to pay its admitted obligations to MGD. At the time the notice was filed, there was nothing to repudiate, insofar as MDG was concerned, because the compromise and settlement agreement had become functus upon the entry of the judgment and the stay order. Thus, the notice served no purpose other The other points relied upon are that the circuit court erred in entering the original order and the amended order appointing commissioners and ordering sale of real property because the judgment sought to be enforced thereby was interlocutory; and that the circuit court further erred in entering the amended order because it did so without notice to Diversified and at a time when it had no jurisdiction over Civil Nos. 401 and 402...
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