NEIL YONEJI, Successor Trustee of the Mitsuo Yoneji Revocable Trust Dated November 27, 1985 and NEIL YONEJI and CLAIRE YONEJI, individually and as Trustees of the Yoneji Revocable Family Trust Dated August 31, 1998, Plaintiffs-Appellants,
CHARLENE YONEJI, Defendant-Appellee
MARY KAZUMI YONEJI, JOHN DOES 1-10, JANE DOES 1-10, DOE PARTNERSHIPS, CORPORATIONS OR ENTITIES 1-20, Defendants
APPEAL FROM THE CIRCUIT COURT OF THE FIFTH CIRCUIT. CIVIL NO. 09-1-0282.
On the briefs: Patrick K. Shea, Sara Jo Buehler, (Shea & Kamiya) and Rebecca A. Copeland, for Plaintiffs-Appellants.
Jason G.F. Wong and Michel A. Okazaki, for Defendant-Appellee.
FOLEY, Presiding J., REIFURTH, AND GINOZA, JJ.
[136 Hawai'i 13] FOLEY, J.
Plaintiff-Appellant Neil Yoneji, Successor Trustee of the Mitsuo Yoneji Revocable Trust Dated November 27, 1985 (Mitsuo Trust) and Neil Yoneji (Neil) and Claire Yoneji, individually and as Trustees of the Yoneji Revocable Family Trust Dated August 31, 1998 (Yoneji Family Trust) (collectively, Yonejis) appeal from the Circuit Court of the Fifth Circuit's (circuit court):
(1) " Amended Judgment (Amends the Judgment Filed May 1, 2013)," filed January 27, 2014;
(2) " Judgment," filed May 1, 2013; and
(3) " Order Granting Defendant Charlene Yoneji's Motion for Summary Judgment (Filed 2/22/13)," (Order) filed May 1, 2013.
On appeal, the Yonejis contend that (1) the circuit court erred in granting a motion for summary judgment in favor of Defendant-Appellee Charlene Yoneji (Charlene) and (2) the circuit court abused its discretion in awarding Charlene attorneys' fees and costs.
This case involves a family trust, the Mitsuo Trust, that is funded by rental income generated from two income-producing properties (together, Properties) that were originally owned by grantor, Mitsuo Yoneji (Mitsuo). The Mitsuo Trust left interests in the Properties to Mitsuo's two sons, Neil and Owen Yoneji (Owen), and any children Mitsuo's sons may have had. Owen was married to Charlene and had one child, Mary Yoneji (Mary).
Four family trusts owned the Properties in varying percentages: the Mitsuo Trust, the Revocable Trust of Owen Kazuo Yoneji, dated January 11, 1994 (Owen Trust), the Revocable Trust of Charlene Tsuruko Yoneji, dated January 11, 1994 (Charlene Trust), and
[136 Hawai'i 14] the Yoneji Family Trust. According to Neil, all profits and expenses related to the Properties were handled through a single trust bank account at the First Hawaiian Bank (Mitsuo Trust Account), which operated under the Mitsuo Trust. Neil and Owen served as Successor Individual Co-Trustees of the Mitsuo Trust. Mary was not properly appointed Successor Individual Co-Trustee of the Mitsuo Trust.
Mary declared that on or about April 11, 2008, per Owen's instructions, she issued a bank check payable to Charlene in the amount of $67,031.14 from the Mitsuo Trust Account without the authorization of Neil. Charlene endorsed the check to Owen and returned it to Mary, who then deposited the check into a Kaua'i Government Federal Credit Union account to which Neil alleges he did not have access.
On October 26, 2009, the Yonejis filed this lawsuit, alleging that Mary and Charlene improperly depleted the Mitsuo Trust Account, and wrongfully redirected the rental income from the Properties, which were co-owned by the various family trusts, to Mary in her personal capacity. The Yonejis also alleged that Charlene was liable for conversion, unjust enrichment, conspiracy, constructive fraud, constructive trust, and prima facie tort for her involvement. On December 22, 2009, Mary and Charlene filed their Answer. On March 14, 2012, Mary's attorney turned over $152,772.46 to the circuit court pending the conclusion of litigation. Mary claims that the interpled funds included the $67,031.14 taken from the Mitsuo Trust Account.
On May 1, 2012, the circuit court filed a " Stipulation For Appointment Of A Special Master." The Special Master was tasked with the following:
1. [Conducting] an audit of the assets, revenues, and expenses of the [Properties] from March 1, 2008 to present.
2. [Determining] the interests of the co-owners of the [Properties] and their past and present entitlement to profits and responsibility for expenses.
3. [Determining] the final account among the co-owners, taking into consideration all distributions and the proceeds/credit from the sale of the [Properties].
4. [Determining] the parties' rights to the amounts related to the [Properties] held, in custody and/or control by any of the parties and the clerk of the Court.
All parties also agreed that " the trier of fact shall rely on the report of the Special Master in determining the amounts, if any, owed by and between all parties in [this] entitled action, subject to their determination of any disputed genuine issue of material fact (as set forth by the Court)[.]" On July 30, 2012, the circuit court issued its " Order Setting Trial Date" that ordered all exhibits to be delivered to the court and served by March 8, 2013.
On February 22, 2013, Charlene filed her Motion for Summary Judgment (MSJ), which included a request for an award of attorneys' fees and costs pursuant to Hawaii Revised Statutes (HRS) § 607-14.5 (Supp. 2014). On March 25, 2013, the Yonejis filed their Opposition to the MSJ. In the Opposition, the Yonejis withdrew all claims made in their individual capacities and argued that genuine issues of material fact remain, which would preclude summary judgment.
On April 2, 2013, the circuit court held a hearing on the MSJ. During the hearing, the Yonejis noted to the court that many of the material issues in the case had not yet been determined because the Special Master had not yet issued his report. The circuit court orally granted the MSJ, finding " I don't understand why the master is taking as long as he is. But I don't -- I cannot imagine there would be something that the master would find in his focus and in his perspective regarding the accounting that would have any impact on the claims against Charlene Yoneji." In granting the MSJ, the circuit court noted that it was " adopting in full" the arguments that Charlene's counsel made in support of her MSJ.
On May 1, 2013, the circuit court reduced its decision to the written Order and Judgment. The court's Order also found that the Yonejis' claims against Charlene were frivolous and awarded Charlene reasonable attorneys fees of $49,117.33 and costs of $2,948.60.
[136 Hawai'i 15] On January 27, 2014, the circuit court entered an Amended Judgment in favor of Charlene on all claims asserted by the Yonejis, pursuant to Rule 54(b) of the Hawai'i Rules of Civil Procedure.
On February 25, 2014, the Yonejis filed a timely notice of appeal.
II. STANDARD OF REVIEW
A. Motion for Summary Judgment
The appellate court reviews " the circuit court's grant or denial of summary judgment de novo." Querubin v. Thronas, 107 Hawai'i 48, 56, 109 P.3d 689, 697 (2005).
Summary judgment is appropriate if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. A fact is material if proof of that fact would have the effect of establishing or refuting one of the essential elements of a cause of action or defense asserted by the parties. The evidence must be viewed in the light most favorable to the non-moving party. In other words, we must view all of the evidence and the inferences drawn therefrom in the light most favorable to the party opposing the motion.
Id. at 56, 109 P.3d at 697 (quoting Durette v. Plastic Recycling, Inc., 105 Hawai'i 490, 501, 100 P.3d 60, 71 (2004)).
The Hawai'i Supreme Court has set forth the following burden-shifting paradigm for situations where the non-movant ...