Price v. AIG Hawaii Ins. Co., Inc.

• Decision Date: 29 March 2005
• Docket Number: No. 24596.,24596.
• Citation: 111 P.3d 1,107 Haw. 106
• Parties: Doctor Nui Loa PRICE, also known as Maui Loa Price; Kia Artrip, also known as Luukia Leiolani Sandra Maria Artrip; and Leilehualani K. Kane, Individually and as Co-Special Administrators of the Estate of Samuel Hubert Price, also known as Kamuela Price, Plaintiffs-Appellants, v. AIG HAWAI'I INSURANCE COMPANY, INC., Defendant-Appellees, and John Does 1-10; Jane Does 1-10; Doe Corporations 1-10; and Doe Partnerships 1-10, Defendants.
• Court: Hawaii Supreme Court

111 P.3d 1

107 Haw. 106

Doctor Nui Loa PRICE, also known as Maui Loa Price; Kia Artrip, also known as Luukia Leiolani Sandra Maria Artrip; and Leilehualani K. Kane, Individually and as Co-Special Administrators of the Estate of Samuel Hubert Price, also known as Kamuela Price, Plaintiffs-Appellants, v. AIG HAWAI'I INSURANCE COMPANY, INC., Defendant-Appellees, and John Does 1-10; Jane Does 1-10; Doe Corporations 1-10; and Doe Partnerships 1-10, Defendants.

No. 24596.

Supreme Court of Hawai'i.

March 29, 2005.

As Corrected on Denial of Reconsideration April 22, 2005.

Earle A. Partington, for plaintiffs-appellants.

Lisa M. Ginoza, Honolulu, R. John Seibert, and Kenneth J. Mansfield, Honolulu (of McCorriston Miller Mukai MacKinnon LLP), for defendant-appellee.

MOON, C.J., LEVINSON, NAKAYAMA, and DUFFY, JJ.; ACOBA, J., Dissenting in Part and Concurring in Part.

Opinion of the Court by MOON, C.J.

This appeal arises from an automobile accident that resulted when a vehicle operated by Timothy Mariano collided with a vehicle in which Samuel Hubert Price, aka Kamuela Price, [hereinafter, Kamuela] was riding. Kamuela died as a result of the accident. Thereafter, plaintiffs-appellants Doctor Nui Loa Price, aka Maui Loa Price; Kia Artrip, aka Luukia Leiolani Sandra Maria Artrip; and Leilehualani K. Kane, individually, and as co-special administrators of the Estate of Kamuela, [hereinafter, collectively, Price] made a claim and demand on defendant-appellee AIG Hawai'i Insurance Company, Inc. [hereinafter, AIG], the insurance company which insured the vehicle in which Kamuela was riding, for uninsured motorist (UM) benefits. However, AIG denied the claim on the basis that Mariano's vehicle was insured at the time of the accident. Price thereafter filed the instant lawsuit.

Price appeals from the circuit court of the first circuit's¹ December 26, 2001 judgment in favor of AIG. On appeal, Price argues that the circuit court erred in: (1) granting AIG's motion for summary judgment inasmuch as depositions attached to the motion and its supporting memoranda were inadmissible; and (2) awarding AIG attorneys' fees and costs without apportioning between assumpsit and non-assumpsit claims.

As discussed more fully infra in section III, we affirm the circuit court's order granting AIG's motion for summary judgment, vacate the award of attorneys' fees, and remand for a redetermination of the proper amount of attorneys' fees.

I. BACKGROUND

A. Factual Background

On March 6, 1998, a motor vehicle in which Kamuela was riding was struck by a 1988 Ford Thunderbird (Thunderbird) operated by Mariano. Kamuela died as a result of the injuries he sustained during the accident.

At the time of the collision, the vehicle in which Kamuela was riding was insured under a motor vehicle policy issued by AIG.² The policy carried $300,000 in UM benefits, but did not carry underinsured motorist benefits.

Mariano's Thunderbird was also insured at the time of the collision.³ According to AIG's records, Mariano, who was also insured by AIG, first applied for and received a motor vehicle insurance policy from AIG on January 16, 1998, covering a 1983 Mazda. At that time, AIG's insurance policy provided in part:

DEFINITIONS

....

J. "Your covered auto" means:

....

2. Any of the following types of vehicles on the date you become the owner:

a. a private passenger auto; or

....

This provision (J.2) applies only if:

a. you acquire the vehicle during the policy period;

b. you ask us to insure it within 30 days after you become the owner; and

c. with respect to a pickup or van, no other insurance policy provides coverage for that vehicle.

(Emphasis in original.) On February 28, 1998, Mariano purchased the Thunderbird and, within thirty days, he notified AIG of the purchase and requested that the Thunderbird be covered by the insurance policy. Thus, Mariano's insurance policy, which provided for bodily injury liability in the amount of "$20/40,000 Each Person/Accident," covered the Thunderbird "effective" February 28, 1998.

Following the accident, Price made a claim and demand on AIG for payment of $300,000 in UM benefits under Kamuela's insurance policy. AIG denied the claim on the basis that Mariano's Thunderbird was covered by an insurance policy at the time of the accident and, thus, was not an uninsured vehicle.

B. Procedural Background

1. Complaint

On December 8, 2000, Price filed a complaint against AIG, asserting that the Thunderbird was not insured at the time of the accident and, therefore, that AIG should have provided UM benefits to Price under Kamuela's insurance policy. In the complaint, Price alleged, inter alia, that "AIG has breached the terms of [Kamuela's] automobile insurance contract and the express or implied covenant of good faith and fair dealing by its conduct in denying uninsured motorist coverage of $300,000[.]" Specifically, Price asserted the following claims: (1) "breach of automobile policy"; (2) "collusion, fraud, misrepresentation, non-disclosure"; (3) "negligence"; (4) "violation of Hawai'i Revised Statutes [(HRS)] § 431-13-103"; (5) "breach of good faith [and] fair dealing"; (6) "punitive damages"; and (7) "treble damages." On January 2, 2001, AIG filed its answer to the complaint.

2. Motion for Summary Judgment

On April 2, 2001, AIG moved for summary judgment on all of Price's claims, arguing that "the vehicle that hit the [Kamuela] vehicle was insured.... As a result, [Price is] not entitled to UM benefits under [Kamuela's] policy and no cause of action exists against AIG for its alleged wrongful denial of the claimed benefits." AIG attached eight exhibits to its motion, two of which are challenged on appeal as inadmissible. The contested exhibits are: (1) excerpts from a deposition given by Mariano during a tort action preceding the instant case, Price, et. al. v. Mariano, Civil No. 98-4662-10(CKH) (Haw. 1st Cir.); and (2) a copy of a deposition given in this case by the records custodian of the used car company that sold Mariano the Thunderbird. AIG's attorney declared that the copies of the depositions were "true and correct" copies. On May 4, 2001, Price filed a memorandum in opposition to AIG's motion.

On May 9, 2001, AIG filed a reply memorandum in support of its motion for summary judgment. AIG attached four new exhibits to the memorandum, two of which are challenged on appeal as inadmissible. The challenged exhibits are copies of two separate depositions taken of Michael Onofrietti, AIG's "[v]ice president and actuary and director of underwriting and product management." Again, AIG's counsel declared that the deposition copies attached to the memorandum were "true and correct copies."

On July 6, 2001, Price filed a supplemental memorandum in opposition to AIG's motion. On August 8, 2001, AIG filed a supplemental reply memorandum, to which it attached five new exhibits, four of which are challenged on appeal. The four exhibits consist of excerpts of depositions taken of: (1) Mariano; (2) Wendi Kealoha; (3) Rosie Reiley; and (4) Teresita Todani.⁴ AIG's counsel declared that the deposition copies were "true and correct copies."

On September 12, 2001, after a hearing on the matter, the circuit court entered findings of fact as follows:

(1) as of March 6, 1998, when a motor vehicle accident occurred that is the subject of the above-captioned action, an enforceable policy of motor vehicle insurance issued by [AIG] to [Mariano] was in effect; (2) on or about February 28, 1998, and under First [Hawaiian] Ins. & Guar. Co. v. Financial Security Ins. Co., 72 Haw. 80, 807 P.2d 1256 (1991), [Mariano] acquired an insurable ownership interest in a 1988 Ford Thunderbird; (3) within thirty days of acquiring said ownership interest, [Mariano] notified [AIG] of this fact and of his request that the Thunderbird vehicle be covered under his existing policy of motor vehicle insurance; (4) that under pertinent provisions of said policy, and upon [Mariano]'s notification that he wanted coverage for the newly acquired vehicle, said vehicle was covered as of the date he acquired the car which date was before March 6, 1998; and (5) as of March 6, 1998, the Mariano Thunderbird involved in the referenced accident was an insured vehicle. As to each of the foregoing factual findings, the [c]ourt finds that there is no genuine issue of material fact.

Based on the foregoing, the circuit court granted AIG's motion for summary judgment.

3. Attorneys' Fees and Costs

On September 26, 2001, AIG filed a motion for "attorneys' fees in the amount of $21,386.00 and costs in the amount of $639.67."⁵ Therein, AIG argued that it was entitled to attorneys' fees under HRS § 607-14 (Supp.1997),⁶ inasmuch as "the `essential character' of this action is one for contract breach and nothing else." AIG argued that "all of [Price]'s claims arose from [AIG]'s alleged breach of its insurance contract to provide UM benefits. Absent the existence of this alleged breach, not one of [Price]'s remaining claims could survive. All flowed inherently and inextricably from the alleged breach of contract."

In the memorandum in opposition to AIG's motion for attorneys' fees and costs, Price argued, inter alia, that, "[w]hile the underlying policy is a contract, the claims of [Price] were that [AIG]'s overt acts of collusion, non disclosure, fraud, and misrepresentation, formed the basis for bad faith and unfair claims settlement practices ... and formed the basis for an award of punitive and treble damages for unfair and deceptive practices." Thus, Price maintained that "the nature of the case sounded in tort and not in contract" and that, therefore, the circuit court should deny AIG's request for fees.

On November 14, 2001, the circuit court, without holding a hearing on the matter or entering findings of fact or conclusions of law, granted AIG's motion for fees and costs. The court awarded AIG "reasonable [a]ttorney's fees of $20,000 and costs of $648.31."

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