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Kondaur Capital Corp. v. Matsuyoshi

Intermediate Court of Appeals of Hawaii

March 7, 2014

KONDAUR CAPITAL CORPORATION, Plaintiff-Appellee,
v.
LEIGH MATSUYOSHI, Defendant-Appellant, and JOHN DOES 1-10, JANE DOES 1-10, DOE PARTNERSHIPS 1-10, DOE CORPORATIONS, 1-10, DOE ENTITIES 1-10, ALL PERSONS RESIDING WITH AND ANY PERSONS CLAIMING BY AND THROUGH OR UNDER THEM, Defendants

NOT FOR PUBLICATION IN WEST'S HAWAII REPORTS AND PACIFIC REPORTER

APPEAL FROM THE CIRCUIT COURT OF THE FIFTH CIRCUIT (CIVIL NO. 12-1-0185)

Joe P. Moss for Defendant-Appellant.

Jonathan W.Y. Lai Thomas J. Berger for Plaintiff-Appellee.

Foley, Presiding J., Leonard and Reifurth, JJ.

MEMORANDUM OPINION

Defendant-Appellant Leigh Matsuyoshi (Matsuyoshi) appeals from the September 18, 2012 "Judgment on Order Granting Plaintiff Kondaur Capital Corporation's Motion for Summary Judgment Against All Defendants on Complaint Filed June 5, 2012" entered in the Circuit Court of the Fifth Circuit[1] (circuit court) in favor of Plaintiff-Appellee Kondaur Capital Corporation (Kondaur Capital).

Matsuyoshi contends the circuit court erred by:

(1) granting Kondaur Capital's motion for summary judgment, and
(2) denying Matsuyoshi's Hawai'i Rules of Civil Procedure (HRCP) Rule 60(b) motion to set aside judgment on the order granting Kondaur Capital's motion for summary judgment.

I. BACKGROUND

By a warranty deed dated February 13, 2007, Jun Matsuyoshi and others conveyed a property located at 2888 Hoolako Street, Lihue, Hawai'i 96766 (Hoolako Property) to Matsuyoshi. The Hoolako Property is located in Kaua'i County.

On March 29, 2007, Resmae Mortgage Corporation (Resmae Corporation) recorded a mortgage on the property with the Bureau of Conveyances as Document No. 2007-057187 (Mortgage). The Mortgage listed Matsuyoshi as the borrower of $500, 000, which she would repay with interest, subject to an adjustable rate rider, no later than May 1, 2037. The Mortgage included an acceleration clause, which provided that Matsuyoshi would be given at least 3 0 days to cure a default of payment. The notary section of the Mortgage represents that Matsuyoshi personally appeared to Notary Public of the State of Hawai'i, Kai Yamamoto (Yamamoto), on March 26, 2007 in the City and County of Honolulu. Yamamoto signed the Mortgage.

At the time Matsuyoshi entered into the Mortgage agreement, Resmae Corporation was in Chapter 11 bankruptcy. On June 5, 2007, the United States Bankruptcy Court for the District of Delaware under Case No. 07-10177, filed its "Findings of Fact, Conclusions of Law, and Order Under 11 U.S.C. § 1129(a) and (b) and Fed.R.Bankr.P. 3020 Confirming the Second Amended Plan of Reorganization of the Debtor Proposed by the Debtor and Sponsored by RMC Mortgage Holdings LLC" (Bankruptcy Order).[2] The Bankruptcy Order, among other things, created the Resmae Liquidating Trust and provided, " [t]itle to and possession of the Trust Property . . . shall be deemed transferred and delivered to the Trust without further act or action under any applicable agreement, law, regulation, order, or rule of law." The Bankruptcy Order sets forth a permanent injunction that bars any claim against the property based on factual allegations arising prior to June 15, 2007, the effective date of the Bankruptcy Order.[3]

By letter dated May 20, 2008, Resmae Corporation gave Matsuyoshi notice of their intent to foreclose on the property because her Mortgage loan was in default. Resmae Corporation stated Matsuyoshi owed $9, 704.34 and required that she pay this amount, including other charges that may become due in the meantime, by June 20, 2008. "Failure to do so will result in acceleration of the due date of all sums secured by this mortgage or deed of trust and the mortgage property being referred for foreclosure action, which may result in sale of the property."

On August 28, 2008, Resmae Corporation recorded an assignment of its interest to Resmae Liquidation Properties, LLC (Resmae Liquidation Properties).

On October 3, 2008, Matsuyoshi was personally served with a notice of Resmae Liquidation Properties' non-judicial foreclosure action against the property. On October 17, 2008, Jun Matsuyoshi was also personally served with notice of Resmae Liquidation Properties' non-judicial foreclosure action in the state of New Jersey.

On November 17, 2008, Lester K.M. Leu (Leu), attorney for Resmae Liquidation Properties recorded a "Mortgagee's Affidavit of Foreclosure Under Power of Sale" (Mortgagee's Affidavit of Foreclosure) on behalf of Resmae Corporation, as Mortgagee. Leu affirmed that Resmae Corporation had sent a notice of default to Matsuyoshi on May 20, 2008; that notice of the public auction sale of the property, to be held November 13, 2008 at noon at 777 Punchbowl Street, Honolulu, Hawai'i 96813, was published in the Honolulu Star-Bulletin for three weeks commencing October 6, 2008; and that Resmae Liquidation Properties bought the property for $416, 900.20 at the nonjudicial foreclosure public auction sale.

On January 22, 2009, Leu recorded a quitclaim deed by and between Resmae Liquidation Properties as foreclosing mortgagee on the Hoolako Property for consideration in the sum of ten dollars.

On July 14, 2010, Resmae Liquidation Properties granted the Hoolako Property to Kondaur Capital via quitclaim deed for one dollar. The quitclaim deed was recorded on February 24, 2011 in the State of Hawai'i Bureau of Conveyances under Document Number 2011-032290 (Quitclaim Deed).

By letter dated May 22, 2012, Kondaur Capital informed Matsuyoshi that she and all other occupants were required to vacate the Hoolako Property immediately.

On June 5, 2012, Kondaur Capital filed a complaint against Matsuyoshi in the instant case, requesting the circuit court eject Matsuyoshi and all other persons from the Hoolako Property and award Kondaur Capital rent for the period Matsuyoshi had unlawfully possessed the Hoolako Property. Kondaur Capital's complaint contained the following pertinent factual allegation: "[Kondaur Capital] acquired title and current ownership of the [Hoolako] Property through a Quitclaim Deed recorded on February 24, 2011 in the Bureau of Conveyances, State of Hawai ['] i under Document Number 2011-032290 ('Quitclaim Deed')."

On June 29, 2012, Kondaur Capital filed a motion for summary judgment. Attached to the motion were affidavits from Kondaur Capital's asset manager, Ann Pham (Pham), and Kondaur Capital's attorney, Thomas J. Berger (Berger). Pham affirmed that Kondaur Capital's records included the ...


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