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Kekumu v. Kekumu

Intermediate Court of Appeals of Hawaii

June 20, 2013

WENDELL E.K. KEKUMU, Plaintiff-Appellant,
v.
LINDA IVLAY KEKUMU, Defendant-Appellee.

NOT FOR PUBLICATION IN WEST'S HAWAII REPORTS AND PACIFIC REPORTER

APPEAL FROM THE FAMILY COURT OF THE THIRD CIRCUIT {FC-D NO. 07-1-0132)

Joy A. De Lima for Plaintiff'-Appellant.

Brian J. De Lima (Crudele & De Lima) for Defendant-Appellee.

Leonard, Presiding Judge, Reifurth and Ginoza, JJ.

SUMMARY DISPOSITION ORDER

Plaintiff-Appellant Wendall E.K. Kekurau (Husband) appeals from the July 6, 2009 Divorce Decree filed in the Family Court of the Third Circuit (family court), [1] in which the family court awarded alimony to Defendant-Appellee Linda May Kekumu (Wife), entered a property division, and awarded Wife $1, 895.84 in attorney's fees.

On appeal, Husband asserts the following points of error: (1) the family court's conclusion of law regarding the wasting of equity in the marital residence is clearly erroneous; (2) with regard to the family court's property distribution, the family court erred when it failed to address tax refunds and Wife's monetary withdrawals, and to award an "equivalence" to Husband; (3) the family court clearly erred in its findings related to Wife's medical condition and her reasonable efforts to secure full time employment; (4) the family court clearly erred in its findings concerning Wife's ability to obtain medical coverage; (5) the family court erred in finding that "[a]t DOCOEPOT, [2] the parties had a joint account at [HFS Federal Credit Union {HFS FCU)], with an account balance of $50.00[;]" (6) the family court erred in its conclusion that the facts of the case analyzed in light of the statutory factors set forth in HRS § 580-4 7 warrant an award of alimony in favor of Wife; and (7) the family court abused its discretion in awarding Wife $1, 895.84 in attorney's fees.

Based upon a careful review of the record and the briefs submitted by the parties, and having given due consideration to the arguments advanced and the issues raised therein, we resolve Husband's issues as follows:

(1) Husband argues that the family court erred in its COL 1, which concludes that neither party will be charged with wasting the equity held in the marital residence:
1. Neither Plaintiff nor Defendant engaged in conduct during the pendency of this case which warrants a conclusion by the court that either party should be charged with "wasting" the asset comprised of the equity the parties held in the marital residence at the time it was subjected to foreclosure. Therefore, the court declines to engage in a deviation in favor of either party on the basis of the other party's alleged wasting of the equity held in the marital residence.

Discussion

The general principle regarding the "wasting" of marital assets has been succinctly stated by the Hawaii Intermediate Court of Appeals as follows:

A reduction of the dollar value of the marital estate chargeable to a divorcing party occurs when, during the time of the divorce, a party's action or inaction caused a reduction of the dollar value of the marital estate under such circumstances that he or she equitably should be charged with having received the dollar value of the reduction.

Higashi v. Higash[i], 106 Hawaii 228 (App. 2004), at 241 (emphasis added).

The issue therefore, as reflected by the emphasised language above, is not simply whether a reduction in the value of the marital estate can be attributed to the "action or inaction" of one of the parties -- it is whether when considering all of the circumstances it would be equitable to charge the entirety of the loss to one or the other party.

It is plainly evident that the parties in this case failed to maintain their mortgage payments and as a result suffered the foreclosure of the marital residence. It is equally evident that the foreclosure cost the parties a significant sum comprised of their equity at the time of the foreclosure.

Plaintiff insists that the loss should be laid at Defendant's feet because she declined to agree to a sale of the residence during the pendency of the divorce. Indeed, Defendant's reluctance to sell the residence was acknowledged at trial, and made manifest by her conduct during the litigation, i.e. her opposition to Plaintiff's motion to list the house for sale.

However, Plaintiff's argument is made less persuasive by the fact that he agreed at the January 7, 2008, hearing on his motion to list and several times thereafter to continue the motion until moved on and, eventually, until the trial date in October, 2008, by whiqh time the motion had been mooted by events. Plaintiff's failure to press the issue of the sale of the residence clearly undermines his position. In addition, the undisputed fact that Plaintiff, who had been making the mortgage payments, unilaterally stopped making the payments in March, 2008, clearly mitigates against laying all of the blame for the foreclosure on Defendant.

Defendant argues that the unilateral decision by Plaintiff to stop paying the mortgage in March, 2008, is a sufficient basis for attributing the loss entirely to Plaintiff. Defendant's case is the closer case in the court's view, but still fails for several reasons. First, although Defendant's intransigence with regard to selling the residence is clearly insufficient to make her solely responsible for the loss, it clearly was a factor along with other factors to be considered. Further, like Plaintiff, Defendant failed to pursue her legal remedies when she agreed in late June and thereafter to continue her motion for relief (seeking an order that Plaintiff make good on the mortgage) until the time of trial.

In short, while it is easy to conclude that the marital residence was subjected to foreclosure because of the collective failures and even the negligence of both parties, it does not seem so clear cut to the court that either of the two parties was so clearly more to blame than the other that it would be equitable to attribute the entire loss to either of them.

The family court's COL 1 concerning marital "waste" presents a mixed question of law and fact, and thus this court reviews it under the clearly erroneous standard of review. See Booth v. Booth, 90 Hawai'i 413, 416, 978 P.2d 851, 854 (1999).

Husband argues that the family court wrongly "assumes that Plaintiff's attempts to settle by continuing the motion in favor of a settlement conference and agreement to continue the trial to accommodate defense counsel's schedule act as a waiver of Defendant's duty to not waste the marital asset." Husband further argues that while he had discharged his duty not to waste by making mortgage payments for as long as he could afford it and until he started making rental payments when he moved out. Wife stubbornly refused to either sell the house or to make mortgage payments, which she could afford at the time.

Because the family court's COL 1 is supported by its findings of facts, the findings of fact are not clearly erroneous, and the decision "reflects an application of the correct rule of law, " it will not be disturbed. See Doe v. Doe, 120 Hawai'i 149, 165, 202 P.3d 610, 626 (App. 2009) (citation omitted). As Husband concedes, the family court cited correct and applicable law. The correct rule of law regarding "waste" is as follows:

A reduction of the dollar value of the marital estate chargeable to a divorcing party occurs when, during the time of the divorce, a party's action or inaction caused a reduction of the dollar value of the marital estate under such circumstances that he or she equitably should be charged with having received the dollar value of the reduction.

Hiaashi v. Higashi, 106 Hawai'i 228, 241, 103 P.3d 388, 401 (App. 2004) .

Furthermore, Husband does not challenge the findings of fact that support COL 1. In determining that neither party-should be equitably charged with "waste" of the marital residence, the family court essentially concluded that both Husband and Wife contributed to the loss of equity in the marital residence because Husband unilaterally stopped making payments in March 2008, Wife actively opposed and failed to agree to the sale of the residence during the pendency of the divorce, and Husband failed to press the issue of the sale of the marital residence. The conclusion that both parties were at fault such that neither party could be equitably charged with waste is supported by the family court's unchallenged findings of fact. Accordingly, COL 1 is not erroneous.

(2) Husband challenges the family court's property division, arguing that the family court failed to address or consider tax refunds that Wife used, Wife's monetary withdrawals from a credit union account, a tax ...


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