Smothers v. Renander

• Decision Date: 11 September 1981
• Docket Number: No. 7485,7485
• Citation: 2 Haw.App. 400,633 P.2d 556
• Court: Hawaii Court of Appeals
• Parties: F. L. SMOTHERS, Plaintiff-Appellee, v. Arthur W. RENANDER, Jr., Defendant-Appellant, and Mukai, ICHIKI, Rafetto & MacMillan, Defendants, v. HAWAIIAN TRUST COMPANY, LTD., Administrator for the Estate of Harry W. Green, Deceased, and as agent for the heirs-at-law of Harry W. Green; and Cyrus L. Green, Harry C. Green, Maymo Dawn Scott and Iris J. Falcom (heirs-at-law of Harry W. Green, Deceased), Intervenors-Appellees.

Page 556

633 P.2d 556

2 Haw.App. 400

F. L. SMOTHERS, Plaintiff-Appellee, v. Arthur W. RENANDER, Jr., Defendant-Appellant, and Mukai, ICHIKI, Rafetto & MacMillan, Defendants, v. HAWAIIAN TRUST COMPANY, LTD., Administrator for the Estate

of Harry W. Green, Deceased, and as agent for the

heirs-at-law of Harry W. Green; and Cyrus L. Green, Harry C.

Green, Maymo Dawn Scott and Iris J. Falcom (heirs-at-law of

Harry W. Green, Deceased), Intervenors-Appellees.

No. 7485.

Intermediate Court of Appeals of Hawai'i.

Sept. 11, 1981.

Syllabus by the Court

1. Attorney's fees may not be awarded absent statute, agreement, stipulation, or precedent authorizing the allowance thereof.

2. A party seeking attorney's fees has the burden to show that the fees are reasonable and that the fees are for services reasonably and necessarily incurred.

3. The trial court's determination of the amount of fees to award is a matter of discretion which will not be disturbed upon appellate review except for the abuse thereof.

4. The fact that the lower court was not provided with an hourly breakdown of services is not necessarily grounds for reversal of an award of fees.

5. Except for the limitation of reasonableness, the limitations which apply when costs are awarded pursuant to statute or rule do not apply when costs are awarded pursuant to an agreement which provides for the award of all advances, costs, or expenses.

6. It is error to award as costs pursuant to statute or rule the expenses for transportation of the attorney, for copies of depositions taken by other parties, for xerox services, for telephone services, for unspecified postal services, and for a party's travel, meals, and lodging.

7. A suit to enforce an agreement to execute and record a release of mortgage is a suit for specific performance and it is not an action in the nature of assumpsit under HRS § 607-14 (1976).

8. Where in the trial court a losing party agrees that fees are due under HRS § 607-14 (1976) but not HRS § 607-17 (1976) and the winning party successfully continues to seek fees under HRS § 607-17 (1976), on appeal the losing party is not barred from contending that fees are not due under both HRS §§ 607-14 (1976) and 607-17 (1976).

9. A mortgage which provides that in the event of foreclosure the mortgagor shall not be liable for any deficiency but which does not require foreclosure in the event of default nor specify that foreclosure is the only remedy upon default does not prohibit the mortgagee from pursuing prior to foreclosure any lawful means to collect all amounts due under the mortgage.

William J. Rosdil, Hilo, for defendant-appellant.

Edward M. Sanpei, Honolulu (Ethan D. B. Abbott, Honolulu, with him on the brief; Hamilton, Gibson, Nickelsen, Rush & Moore, Honolulu), for plaintiff-appellee.

David Waters, Honolulu (William C. McCorriston and Bettina W. J. Lum, Honolulu, on the brief; Goodsill, Anderson & Quinn, Honolulu), for intervenors-appellees.

Before HAYASHI, C. J., and PADGETT and BURNS, JJ.

BURNS, Judge.

Plaintiff-Appellee F. L. Smothers, Defendant-Appellant Arthur W. Renander, Jr., and Intervenor-Appellee Hawaiian Trust Company, Ltd. (HTC), were parties in a nonjury trial to determine the validity of and their respective rights under various oral and written agreements. The trial court found in favor of Smothers and HTC. Renander appeals the award of attorney's fees and costs to the victors.

The specific issue is whether the award of costs, expenses, and attorney's fees was authorized by statute, stipulation, agreement, or precedent and, if so, how much should be awarded. We hold that some items were authorized and some were not.

On December 30, 1969, Smothers purchased 31.79 acres of land in Kona from Hawaiian Trust Company and Renander; gave HTC a $635,367.18 promissory note secured by a non-recourse purchase money first mortgage; and gave Renander a $174,600.00 promissory note secured by a non-recourse purchase money second mortgage.

On April 30, 1970, Renander purchased an adjoining 26.61 acres from HTC and gave HTC a $497,833.14 note secured by a non-recourse purchase money first mortgage.

On December 29, 1972, by agreement between the parties, Smothers' debt to HTC was reduced to $444,757.03; Smothers' debt to Renander was reduced to $96,400.00; Renander's debt to HTC was reduced to $337,080.49; and new notes and mortgages were signed.

In a letter to Smothers dated May 1, 1976, Renander agreed to release Smothers from his note and second mortgage obligation to Renander if HTC reduced in a specific fashion the payments Renander was required to make on his note and mortgage obligation to HTC.

Thereafter, HTC agreed to reduce Renander's required payments in the specific fashion suggested by Renander. HTC also modified Smothers' December 29, 1972, note and mortgage by a Loan Modification Agreement dated May 7, 1976 (Smothers' LMA).

HTC's agreement to reduce Renander's payments was contained in a Loan Modification Agreement also dated May 7, 1976 (Renander's LMA). Renander signed his LMA on June 10, 1976, at which time he also agreed to subordinate his mortgagee's interest in Smothers' property to HTC's May 7, 1976, mortgagee's interest. However, Renander failed to release Smothers from his note and mortgage obligation or to subordinate the lien of his mortgage.

On May 10, 1977, Smothers sued Renander (and his attorneys, Mukai, Ichiki, Rafetto & MacMillan (MIRM) to compel Renander to release Smothers from his note and second mortgage obligation. Renander filed an answer denying the May 1, 1976, letter agreement and the May 7, 1976, Renander LMA. He also filed a counterclaim against Smothers, claiming that when Smothers negotiated the LMAs he breached a contractual duty owed to Renander, caused damages, ¹ created a constructive trust, and was unjustly enriched.

On February 1, 1978, the trial court granted HTC's motion to intervene as a party plaintiff, ² and HTC filed a complaint asking the court to declare which agreements were valid and binding and which were not and to enforce the valid ones. Renander filed a counterclaim against HTC, alleging it breached its agreement in the December 29, 1972, HTC-Renander mortgage to permit partial releases of portions of the mortgaged property and that it conspired with Smothers to cause Smothers to breach his fiduciary obligations to Renander.

MIRM interpleaded against Smothers and Renander and, by stipulation, it was excused from the case with the understanding that the court would order one or both parties to pay it $600.00 fees and costs.

After a bench trial, the lower court decided in favor of Smothers and against Renander and ruled that Renander was obligated to release Smothers' note and mortgage, that Smothers' note and mortgage was null and void, that Renander's counterclaims were without merit, and that Renander owed HTC.$55,125.00 under the Renander LMA for calendar years 1975, 1976, and 1977. It ordered Renander to pay Smothers $15,600.00 for attorney's fees and $4,154.13 for costs and expenses, to pay HTC $19,000.00 for attorney's fees and $1,608.61 for costs, and to pay MIRM $600.00 for fees and costs.

On appeal, Renander contends that the trial court erred when it awarded fees and costs to Smothers and to HTC.

SMOTHERS' ATTORNEY'S FEES

Smothers sued to enforce the commitments Renander made to him in the letter dated May 1, 1976. In that letter, Renander agreed that if HTC reduced his obligation in a specific fashion, then he would release Smothers from his note and mortgage obligation to Renander. The execution of the Renander LMA fulfilled the condition and Renander was then obligated to release Smothers from his obligation. When he refused, Smothers sued to compel him to do so.

Attorney's fees may not be awarded absent statute, agreement, stipulation, or precedent authorizing the allowance thereof. Yokochi v. Yoshimoto, 44 Haw. 297, 353 P.2d 820 (1960); 10 Wright & Miller, Federal Practice and Procedure: Civil § 2675 (1973). In the Smothers-Renander portion of this case, we have no authorizing statute, agreement, stipulation, or precedent.

HRS § 607-17 (1976) ³ (suit on a promissory note or other contract in writing) is not applicable because the May 1, 1976, letter did not provide for attorney's fees. HRS § 607-14 (1976) ⁴ (suit in the nature of assumpsit) is not applicable because Smothers' claim against Renander is not an action "in the nature of assumpsit."

Smothers' suit against Renander was for specific performance. Specific performance is an equitable remedy of ancient origin. 71 Am.Jur.2d, Specific Performance, § 1 (1973). On the other hand, assumpsit is a common law form of action for the recovery of damages for non-performance of a contract. Black's Law Dictionary 112 (5th ed. 1979); Allied Amusements v. Glover, 40 Haw. 92 (1953); Osorio v. Waterhouse Tr. Co., 29 Haw. 376 (1926); Braham v. Honolulu Amusement Co., Limited, 21 Haw. 583 (1913); 1 Am.Jur.2d, Actions, §§ 11, 13, 14 (1962).

However, a portion of Renander's counterclaim against Smothers is "in the nature of assumpsit" and HRS § 607-14 (1976) is applicable to that portion. As against Renander's counterclaim, Smothers was a winning defendant and as such, for that portion of the case, he is entitled to a reasonable fee not to exceed HRS § 607-14's percentages "upon the amount sued for" by Renander in his counterclaim. Although at the end of the trial Renander admitted he could not prove damages, his request prior to that time was for $100,000.00. We hold that Smothers is entitled to the $3,125.00 maximum attorney's fees authorized by HRS § 607-14 (1976) on Renander's $100,000.00 counterclaim.

Smothers points out that Renander's only objection in the lower court to his request for attorney's fees was that the request was based on HRS § 607-17 (1976) and Food Pantry v. Waikiki Business Plaza, Inc., 58 Haw. 606, 575 P.2d 869 (1978), rather than on HRS § 607-14 (1976) and that...