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Ito v. Investors Equity Life Holding Co.

Supreme Court of Hawai'i

February 27, 2015

GORDON ITO, Insurance Commissioner of the State of Hawai'i, Petitioner-Appellee,

Page 119

[Copyrighted Material Omitted]

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James J. Bickerton and Nadine Y. Ando, for appellant.

William C. McCorriston and John Y. Yamano, for appellee Gordon Ito, Insurance Commissioner of the State of Hawai'i.

David J. Reber, and Lindalee K. Farm and Franklin D. O'Loughlin, pro have vice and Cindy C. Oliver, pro hac vice, for appellee Hawaii Life and Disability Insurance Guaranty Association.



Page 121

[135 Hawai'i 52] NAKAYAMA, J.


Investors Equity Life Holding Company (IELHC) is the former parent company and sole shareholder of Investors Equity Life Insurance Company of Hawaii, Ltd. (IEL). In 1994 IEL was liquidated, thus creating the IEL estate. The State of Hawai'i Insurance Commissioner (Commissioner) was appointed as IEL's liquidator (Liquidator). This case concerns the Liquidator's denial of IELHC's purported claim to all remaining assets of the IEL estate.

In 1996, IELHC surrendered all of its shares in IEL to the Commissioner as part of a settlement agreement to resolve claims relating to IEL's insolvency. The Liquidator canceled IELHC's shares in IEL and issued new shares in IEL to the Hawaii Life and Disability Insurance Guaranty Association (HLDIGA).[1] As consideration for these new shares in IEL, HLDIGA cancelled $249,975 of its claims against IEL's estate arising out of its subrogation of covered IEL policyholders' claims.

The Liquidator proceeded to administer IEL's estate -- marshaling assets, distributing funds, and filing interim reports. More than eleven years elapsed before, in 2008, IELHC wrote the Liquidator two letters claiming that IELHC presently held legal or equitable title to all of IEL's stock and demanding that the Liquidator deliver to IELHC all shares and assets remaining in IEL's estate.

Page 122

After failing to resolve the dispute through mediation, IELHC filed a lawsuit in the Superior Court of California against current and former Insurance Commissioners, as well as other individuals involved in the liquidation [135 Hawai'i 53] of IEL (the California Lawsuit). The action was stayed on the grounds of forum non conveniens.[2]

In 2009, the Liquidator determined that IELHC's letters and its California Lawsuit constituted a claim against IEL's estate. The Liquidator denied the claim, and his determination was upheld by order of the Circuit Court of the First Circuit (circuit court).

IELHC appealed to the Intermediate Court of Appeals (ICA) and applied for mandatory and discretionary transfer to this court. We accepted IELHC's application for discretionary transfer on the grounds that the appeal presents a question of first impression of whether IELHC's letters to the Liquidator and the California Lawsuit constituted a claim against IEL's estate under Hawai'i Revised Statutes (HRS) § 431:15-329 (2005).

In its opening brief, IELHC raises five points of error[3]: (1) " The circuit court below had no subject matter jurisdiction to confirm an 'IELHC claim' which [Commissioner] Schmidt himself contrived, but which appellant has not brought" ; (2) " The circuit court had no personal jurisdiction over appellant" ; (3) " Because the California lawsuit is a prior pending action, the 'IELHC claim' which [Commissioner] Schmidt invented must be abated" ; (4) " The summary procedures utilized by the circuit court denied appellant's rights to due process" ; and (5) " Even if appellant had brought the 'IELHC claim,' which appellant had not, [Commissioner] Schmidt is judicially estopped from asserting that appellant's claim is too late." We hold that the circuit court did not err in concluding that IELHC asserted a claim against IEL's estate and that this claim was time barred. Furthermore, the circuit court had personal jurisdiction over IELHC and subject matter jurisdiction over IELHC's claim, there were no grounds for abating the adjudication of IELHC's claim, and the circuit court's procedures met constitutional due process requirements.


A. The liquidation of Investors Equity Life Insurance Company of Hawaii

Page 123

IEL was an insurer whose business consisted of deferred annuities and traditional and interest-sensitive life insurance policies. On August 5, 1994, then State of Hawai'i Insurance Commissioner Lawrence Reifurth commenced an insurance insolvency proceeding by filing a petition for the liquidation of IEL in the circuit court, pursuant to the Insurers Supervision, Rehabilitation and Liquidation Act (ISRLA), [4] HRS § § 431:15-306 [135 Hawai'i 54] (1993)[5] and 431:15-301 (1993). IEL had a net deficit in excess of $90,000,000, and the Commissioner had seized its assets on June 22, 1994.

The petition for liquidation sought liquidation on the grounds that IEL was insolvent and that attempts to rehabilitate IEL would substantially increase the risk of loss to policyholders, would be futile, and would serve no useful purpose.[6]

Appellant IELHC -- IEL's parent company and sole shareholder -- intervened in the proceeding by stipulation of the parties. IELHC opposed the petition for liquidation and petitioned for approval of a rehabilitation plan wherein IELHC would contribute assets to IEL that would generate a potential cash flow of more than $87,000,000.

The circuit court[7] concluded that IELHC's rehabilitation plan was " not reasonable or feasible." The court further concluded that, pursuant to HRS § 431:15-104(c) (1993), only the Commissioner could seek approval of a rehabilitation plan and, pursuant to HRS § 431:15-305 (1993), only directors of an insurer could object to a petition for liquidation. The court granted the petition for liquidation, ordered the liquidation of IEL under the Commissioner's supervision, appointed the Commissioner as liquidator of IEL, and directed the Liquidator to take possession of IEL's assets and administer them under the general supervision of the court. Judgment on the petition for liquidation was entered in favor of the Commissioner and against IEL and IELHC on January 27, 1995.

IELHC appealed the judgment. The appeal was dismissed by a January 11, 1996 opinion of this court, holding that IELHC did not have standing to oppose the petition to liquidate IEL because HRS § 431:15 did not recognize the interests of shareholders -- such as IELHC -- of an insolvent insurer. See Metcalf v. Investors Equity Life Ins. Co., 80 Hawai'i 339, 340, 910 P.2d 110, 111 (1996) (hereinafter Metcalf v. IEL).[8]

During the pendency of the appeal, the circuit court,[9] by order on August 23, 1995, approved the Liquidator's liquidation plan for the disbursement of IEL's assets. The order established a claims bar date of December 1, 1995 for the submission of creditor claims to IEL assets. The order also approved a service agreement between the Liquidator and HLDIGA and approved disbursements to HLDIGA. Under the agreement, HLDIGA assumed policy coverage for the vast majority of policyholders -- all but about 100 of approximately 13,000 -- and the policyholders covered by HLDIGA were deemed to have assigned and subrogated all of their claims against IEL's estate to HLDIGA. As of November 30, 1995, HLDIGA had $143,000,000 in claims against IEL's estate due to HLDIGA's assumption of IEL's policyholder liabilities.

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[135 Hawai'i 55] As part of the liquidation plan, on March 22, 1995, the Liquidator, HLDIGA, and Hartford Life Insurance Company (Hartford),[10] the assuming insurer, entered into an Assumption Reinsurance Agreement, which was approved by the circuit court on June 21, 1995.[11] Under the agreement, Hartford reinsured all of IEL's policyholders previously assumed by HLDIGA. HLDIGA retained continuing obligations to contribute to the funding of the policies Hartford assumed.

B. The Commissioner's lawsuit against Investors Equity Life Holding Company

Contemporaneously with the liquidation of IEL, then-Commissioner Lawrence Reifurth brought suit against IELHC and Gary Vose (the sole shareholder, director, and President of IELHC), among others, for alleged tortious misconduct in causing the failure of IEL. The Commissioner's complaint, filed November 17, 1994, alleged that IELHC diverted IEL's assets into risky investments and reckless real estate transactions, primarily for the benefit of non-IEL entities. IELHC settled the lawsuit with the Commissioner by executing a settlement agreement on July 16, 1996. As a condition of settlement, the agreement provided that IELHC surrender to IEL all of its shares in IEL for cancellation and forfeiture. On October 9, 1996, Gary Vose, on behalf of IELHC, surrendered 208,693 shares of IEL to Commissioner Metcalf, for " cancellation and forfeiture pursuant to HRS § 431:5-101." To evidence the surrender, Gary Vose executed a document entitled " Stock Surrender and Forfeiture," to which he attached the original stock certificate.

The circuit court,[12] in the liquidation proceeding, held a hearing on the Motion to Approve Settlement Agreement on October 28, 1996 and approved the agreement on November 8, 1996. Counsel for IELHC appeared at the hearing. On November 27, 1996, IELHC, through its president Gary Vose, executed a Waiver of Right of Appeal of Order Granting Liquidator's Motion to Approve Settlement Agreement, in which it " waive[d] and release(d) any and all rights [it had], or may in the future have, to appeal from, or otherwise seek judicial review or reconsideration of, the Order Granting Motion to Approve Settlement Agreement, including any and all written orders, findings of fact, conclusions of law, decisions and/or judgments relating to the Order Granting Motion to Approve Settlement Agreement."

On November 12, 1996, the Liquidator executed a stock subscription agreement between IEL and HLDIGA. Through this agreement, the Commissioner issued 49,500 new shares of IEL stock to HLDIGA. In exchange, HLDIGA canceled $249,975 of its $143,000,000 in claims against the IEL estate resulting from its assumption of IEL's policyholder liabilities and its continuing obligations to Hartford. HLDIGA established the Hawaii Association Grantor Trust, overseen by Buck & Associates with Fred Buck as trustee, to hold the shares. The agreement stated that IEL had 208,693 outstanding shares of capital stock held by IELHC, owned by Gary Vose, and that IELHC had agreed to surrender the issued stock for cancellation and forfeiture under its settlement agreement with the Liquidator. The stock subscription agreement pledged that, simultaneously with the surrender and cancellation of all shares of IEL common stock held by IELHC, IEL would issue 49,500 shares of common stock to the Hawaii Association Grantor Trust for the benefit of HLDIGA.

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The Liquidator filed a motion to approve the amendments to settlement agreement and to approve the stock subscription agreement on December 12, 1996 and served IELHC with the motion and notice of hearing. The amendments to the agreement were attached to the motion as Exhibit A, [135 Hawai'i 56] and the stock subscription agreement was attached as Exhibit 1 to Exhibit B.[13] On December 27, 1996, at the hearing on the motion, counsel for IELHC, Kimble Cook and Lyle Hosoda, appeared and stated that IELHC had no objections.[14] The circuit court,[15] in the liquidation proceeding, approved the agreement on December 30, 1996.

C. IELHC's claims to the ownership and property of IEL

The Liquidator proceeded to administer IEL's assets, make partial distributions of funds to HLDIGA, and file interim reports with the circuit court.[16] The Liquidator's February 27, 2008 report showed a deficit of approximately $13,000,000 in IEL's estate as of December 31, 2008.

HLDIGA remains a significant creditor of IEL's estate. In 2002, it submitted an updated Proof of Claim asserting a claim against IEL for $174,961,455 as a Class 2[17] and Class 4[18] creditor and for the residual amount of the estate as a Class 9[19] creditor, as the sole shareholder of IEL. At that time, the claim had been partially satisfied, leaving a claim amount of $38,580,355 plus HLDIGA's shareholder claim for any residual assets in IEL's estate. Since then, the Liquidator has distributed $3,336,943 to HLDIGA for administrative expenses incurred. As of 2009, the Liquidator's records showed an outstanding creditor claim of $35,243,412 to HLDIGA, not including any additional amount that may be due for administrative expenses incurred and interest accrued since the date of its claim.

On April 23, 2008, IELHC wrote then Liquidator J.P. Schmidt a letter (first letter), claiming that the February 27, 2008 report " materially misstated and misrepresented" the financial condition of IEL's estate and that the estate had a surplus of more than $21,000,000, not a deficit.[20] IELHC also claimed that the Commissioner's 1996 " taking," or " attempt at such taking," of IEL's stock was " not in accordance" with Hawai'i law and that the disposition of the stock to HLDIGA was a " further taking without just compensation and ultra vires acts beyond the statutory authority of the Insurance Commissioner." Consequently, IELHC claimed that it presently had " equitable title, legal title, or both to IEL's stock" and demanded that the Commissioner deliver " all authorized, issued, and outstanding shares of stock of IEL" and distribute " the remaining surplus of the estate."

Page 126

[135 Hawai'i 57] IELHC reasserted title to IEL's stock in a July 2, 2008 letter to the Liquidator (second letter). The second letter stated that the Liquidator's and HLDIGA's claims to ownership of IEL's stock were " far from free and clear, and are subject to doubt and dispute." IELHC posited that its surrender of IEL shares made the shares " forfeitable," but not necessarily " forfeited." Citing the statute governing the " Impairment of Capital," HRS § 431:5-101 (2005),[21] IELHC asserted that " [u]nless and until [the shares were] actually forfeited, they necessarily remain[ed] IEHLC's [sic] shares even though the insurance Commissioner [sic] may have physical possession of them." IELHC suggested that the parties employ a professional mediator and seek " a mutually agreeable resolution."

The Commissioner and IELHC participated in voluntary formal mediation through the end of 2008, but they were unable to negotiate a resolution of IELHC's claims.

On May 4, 2009, IELHC filed a complaint in the California Superior Court against: then-Commissioner Schmidt; former-Commissioner Reifurth; HLDIGA; Hawaii Association Grantor Trust; Buck & Associates and Fred Buck as trustees of the Hawaii Association Grantor Trust; Kerry Komatsubara in his individual and official capacity as Special Deputy Liquidator of IEL; Timothy Bogan in his capacity as the Former Chief Examiner of the Hawai'i Division of Insurance; and McCorriston Miho Miller Mukai LLP, and William McCorriston and John Yamano individually, as Commissioner Schmidt's former attorneys. The complaint reasserted IELHC's claims of a surplus in IEL's estate and of an unconstitutional taking of its IEL stock, as well as claims for denial of due process and equal protection, unreasonable seizure, unconstitutional taxation, fraud, negligent misrepresentation, breach of fiduciary duty, conversion, unfair competition, civil conspiracy, and aiding and abetting.

In the complaint, IELHC specifically asserted that it had demanded all outstanding shares of IEL stock and made a claim to distributions from IEL's estate:

56. Promptly upon discovery of the relevant facts and circumstances giving rise to this action, by letter sent on April 23, 2008 Plaintiff served a demand upon Schmidt, through their respective attorneys, for Schmidt to deliver to Plaintiff all of the authorized, issued, and outstanding shares of stock of IEL, and any certificates representing said shares; and claim to distribution of the monies and assets remaining in the estate of IEL.
57. Schmidt has failed and refused to deliver to Plaintiff all of the authorized, issued, and outstanding shares of stock of IEL, and any certificates representing said shares; and claim to distribution of the monies and assets remaining in the estate of IEL.

The complaint sought compensatory damages of $60,000,000, punitive damages, an accounting, an injunction, a constructive trust over all assets in IEL's estate, restitution, declaratory relief, and attorneys' fees. The complaint specifically sought a declaration that IELHC " has legal and equitable right, title and interest in the monies and assets remaining in the estate of and in IEL's stock, and shares, certificates, and value of such stock."

Page 127

By order dated October 6, 2009, the Superior Court of the State of California stayed the action, on motion by the Commissioner, on grounds of forum non conveniens. The California Court of Appeal affirmed the order by opinion dated May 31, 2011. Investors Equity Life Holding Co. v. Schmidt, 195 Cal.App.4th 1519, 126 Cal.Rptr.3d 135, 139 (Cal. Ct. App. [135 Hawai'i 58] 2011) (hereinafter IELHC v. Schmidt). The court reasoned that the only significant question on appeal was whether Hawai'i constituted a suitable alternative forum in light of the possible expiration of the statute of limitations. Id. at 142-43. It stated:

Defendants have agreed to toll the statute of limitations from February 25, 2009, the date plaintiff filed its California action, to the date plaintiff files suit in Hawaii. Their second stipulation makes clear that, if this action is refiled in Hawaii, one issue will be the timeliness of any claims time barred in that state as of February 25, 2009. . . . In addition, they argue Hawaii, like California, recognizes the delayed accrual of a claim where the plaintiff is reasonably ignorant of it, plus the tolling of a statute of limitations where a defendant conceals the existence of a cause of action.

Id. at 144. Because IELHC would face the same burden of establishing the timeliness of its claim in California or Hawai'i, the California Court of Appeal concluded that the trial court's stay was proper. Id. at 146.

D. Adjudication of IELHC's claims against IEL's estate

On November 20, 2009, the Liquidator issued a Notice of Determination of Claim Submitted by [IELHC] pursuant to HRS § 431:15-329(a).[22] In the Notice of Determination, the Liquidator stated that IELHC's first and second letters, and IELHC's May 4, 2009 California Lawsuit, constituted a claim to assets of IEL's estate made by IELHC. The Liquidator denied the claim and concluded that " the entire IELHC Claim fails because IELHC has not established that it is either the shareholder of [IEL], or that it was wrongfully deprived of its ownership of shares of [IEL]." The Liquidator reasoned that IELHC's claim to all shares of IEL stock was without merit because IELHC voluntarily surrendered and forfeited its shares of IEL stock as a condition of the 1996 settlement agreement. Furthermore, IEL's purported Class 9 shareholder claim was subordinate to all higher priority claims, there were insufficient assets available for distribution to Class 9 shareholders, and IELHC's claim was untimely inasmuch as the August 23, 1995 order approving the Commissioner's liquidation plan established December 1, 1995 as the claims bar date.

On January 15, 2010, IELHC timely filed objections to the Liquidator's determination. IELHC argued that the Liquidator had no personal jurisdiction over IELHC, the Liquidator had no subject matter jurisdiction " over what the Liquidator purports to be a 'claim' asserted by [IELHC]," and the Liquidator was barred from making the purported determination. Specifically, IELHC argued that: (1) the Liquidator was disqualified from making the determination because the Liquidator -- as a defendant in IELHC's California Lawsuit -- had a personal interest in the matter that prevented him from providing disinterested, objective advice; (2) IELHC did not submit a claim or proof of claim to the Liquidator; (3) the California Lawsuit's assertion of claims against the Liquidator was not an assertion of claims against the estate of IEL; (4) IELHC's " claim," as defined by the Liquidator, is not the type of claim considered by HRS § 431:15-329; and (5) the Liquidator had " no jurisdiction, right, or authority unilaterally to assume jurisdiction over the California Action or any of the claims or causes of action alleged therein." IELHC demanded that the Liquidator immediately withdraw the November 20, 2009 determination."

Page 128

The Liquidator rejected IELHC's arguments and declined to withdraw the November 20, 2009 determination. Pursuant to HRS § 431:15-329(b), [23] on May 11, 2010, the [135 Hawai'i 59] Liquidator filed a Motion for an Order Confirming the Liquidator's Determination of a Disputed Claim in the circuit court liquidation case. He argued that the denial of IELHC's claim should be confirmed for the reasons cited in the November 20, 2009 determination and that the " undisputed record" of the liquidation proceedings supported a denial of IELHC's claim.

HLDIGA filed a Joinder in Liquidator's Motion for an Order Confirming the Liquidator's Determination of a Disputed Claim on May 21, 2010.

IELHC opposed the Liquidator's motion and moved to dismiss it. IELHC argued that: (1) IELHC never filed a claim with the Liquidator and therefore the circuit court lacked subject matter jurisdiction over the Liquidator's motion; (2) IELHC had a constitutional right to a jury trial to determine the disputed ownership of the IEL stock; (3) the Liquidator had no right or authority to determine the ownership of IEL's stock because it was not a part of IEL's estate; (4) the Liquidator had a conflict of interest in " fabricating" and adjudicating IELHC's " claim" while being a defendant accused of misconduct in IELHC's California Lawsuit; (5) the Liquidator's procedures did not afford IELHC administrative or procedural due process; (6) the circuit court lacked personal jurisdiction over IELHC; (7) because the California Lawsuit involved many of the same issues between the same parties, abatement of the Liquidator's motion was necessary; and (8) the Liquidator's determinations regarding the ownership of IEL's stock constituted an attempt to enforce a settlement agreement, which would necessitate filing a separate action. IELHC also opposed HLDIGA's joinder, stating that HLDIGA has no standing under HRS § 431:15-329.[24]

The circuit court[25] granted the Liquidator's motion and denied IELHC's motion to dismiss by Findings of Fact, Conclusions of Law and Order entered on October 6, 2010. The circuit court concluded, in relevant part:

Conclusions of Law
. . . .
3. In its letters to the Liquidator dated April 23, 2008 and July 2, 2008 and its First Amended Complaint filed in the California Lawsuit, IELHC asserts that it is entitled to all IEL stock and all residual assets in IEL's estate. . . . These assertions constitute claims against the IEL estate within the meaning if [sic] ISRLA.
4. A party cannot avoid the substantive requirements of a law by failing to follow the procedural requirements of the law. A demand to a liquidator for payment of money or transfer of property out of the insolvent insurer's estate, by one claiming a right to such funds or property, is a " claim" within the meaning of ISRLA, regardless of the form in which it is asserted.
5. Resolution of who owns and has rights to IEL's stock determines a potential right to distribution from the estate of IEL. . . .
6. The Court concludes that IELHC has asserted a claim against the estate of IEL under ISRLA, which claim the Liquidator has denied.
7. ISRLA requires the Court to determine disputed claims . . . [pursuant to] H.R.S. § 431:15-329.
8. To permit parties to assert claims against the IEL estate in various forms (including as lawsuits elsewhere) and not recognize those claims as claims against the IEL estate under ISRLA would undermine [135 Hawai'i 60]

Page 129

the purpose of ISRLA to protect " the interests of insureds, claimants, creditors, and the public generally . . . through . . . [e]nhanced efficiency and economy of liquidation [] to minimize legal uncertainty and litigation; [and] [e]quitable apportionment of any unavoidable loss." H.R.S. § 431:15-101(d). . . .
9. This Court has the duty to resolve IELHC's claim pursuant to H.R.S. § 431:15-329(b), and has subject matter jurisdiction over the Liquidator's Motion for an Order Confirming the Liquidator's Determination of a Disputed Claim Pursuant to H.R.S. Section 431:15-329(b).
. . . .
13. IELHC has been and remains a party to this proceeding by virtue of its intervention and extensive participation in the proceedings over many years. Further, this Court concludes that it has personal jurisdiction over IELHC and that service of process on IELHC was sufficient.
. . . .
18. IELHC is not the legal or equitable shareholder of IEL. IELHC has presented no evidence to demonstrate an entitlement to the IEL stock or to demonstrate that it was wrongfully deprived of its IEL shares. . . . The [1996] Stock Subscription Agreement was lawful, proper and approved by this Court nearly 14 years ago after a hearing at which IELHC's counsel appeared.
19. IELHC voluntarily relinquished its shares as part of the Settlement Agreement approved by this Court. The record affirmatively demonstrates that IELHC has no current interest in IEL's estate and is not entitled to a distribution from the IEL estate as a shareholder of IEL. IELHC does not have any current legal or equitable interest in IEL's stock and IELHC was not wrongfully deprived of its shares.
. . . .
30. Insurance liquidations are considered equitable proceedings. . . . Accordingly, ISRLA does not provide for jury trials of creditor claims. The absence of provisions for jury trials in such proceedings does not offend the Constitution.
. . . .
36. This Court concludes that the Liquidator does not have a conflict of interest and that there is no basis which would disqualify the Liquidator from making a determination on the IELHC claim or moving for confirmation of the denial of the IELHC claim. . . .
37. . . . [T]his Court has exclusive jurisdiction over claims against IEL's estate and is obligated to resolve them. As a result this Court may not properly abate the Liquidator's Motion.

The circuit court also concluded that IELHC's claim was time barred:

IELHC's contention that it was not aware of its claim until March of 2008 is contrary to the record. . . . [T]he record shows that IELHC knew long ago it no longer was a shareholder in IEL, that HLDIGA was the beneficiary of the IEL stock, and that HLDIGA was receiving distributions from the IEL estate. In addition, IELHC has not established that any statutory authority permits the late filing of its claim.

On November 4, 2010, IELHC timely appealed the circuit court's order to the ICA.[26]

After the briefs were filed, on November 16, 2011, IELHC filed an application for transfer to this court. The Liquidator and HLDIGA filed oppositions to the application on November 22, 2011. The application for transfer was granted on December 16, 2011.

Page 130


A. Conclusions of Law

" We review the [circuit] court's conclusions of law de novo under the right/wrong standard." Metcalf v. Voluntary Emps. Benefit Ass'n of Haw., 99 Hawai'i 53, 57, 52 P.3d 823, 827 (2002).

B. Jurisdiction

The existence of jurisdiction is a question of law, reviewed de novo. Dupree v. Hiraga, 121 Hawai'i 297, 312, 219 P.3d 1084, 1099 (2009).

C. Statutory Interpretation

Statutory interpretation is reviewable de novo. Haw. State Teachers Ass'n v. Abercrombie, 126 Hawai'i 318, 320, 271 P.3d 613, 615 (2012). We observe the following principles when interpreting statutes:

" First, the fundamental starting point for statutory interpretation is the language of the statute itself. Second, where the statutory language is plain and unambiguous, our sole duty is to give effect to its plain and obvious meaning. Third, implicit in the task of statutory construction is our foremost obligation to ascertain and give effect to the intention of the legislature, which is to be obtained primarily from the language contained in the statute itself. Fourth, when there is doubt, doubleness of meaning, or indistinctiveness or uncertainty of an expression used in a statute, an ambiguity exists. And fifth, in construing an ambiguous statute, the meaning of the ambiguous words may be sought by examining the context, with which the ambiguous words, phrases, and sentences may be compared, in order to ascertain their true meaning."

Id. (quoting Haw. Gov't Emps. Ass'n v. Lingle, 124 Hawai'i 197, 202, 239 P.3d 1, 6 (2010)).


A. Standard of Review for Liquidation Proceedings

Before reaching the issues raised on appeal, we must first determine what standard of review to afford the decisions of a circuit court during liquidation proceedings (the liquidation court). ...

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