TO THE INTERMEDIATE COURT OF APPEALS (CAAP-10-0000181; MASTER
FILE NO. 00-1-MFL)
Alexander Y. Marn, individually, and Alexander Y. Marn, and
Ernestine L. Marn, as Co-trustees of the Revocable Living
Trust Agreement of Alexander Y. Marn, petitionerspro se
Guttman and Dawn Egusa for James. K. M. Dunn, as Successor
Trustee of the Annabelle Y. Dunn Trust,
B. Desmarais for James Y. Marn, Jr.
K.Y. Ing and Zachary M. DiIonno for Liquidating Receiver S.
RECKTENWALD, C.J., NAKAYAMA, McKENNA, POLLACK, AND WILSON,
appeal is the most recent development in the Marn family
litigation, which has been ongoing for almost twenty years
and concerns the ownership and control of the Marn family
business. In brief, in 1998 Petitioner-Appellant Alexander Y.
Marn (Alexander) sought a declaratory judgment and specific
performance regarding his rights to the family business.
Despite a jury demand, a bench trial was held and the Circuit
Court of the First Circuit (circuit court) held in favor of
Respondent-Appellee James K.M. Dunn (Dunn). The Intermediate
Court of Appeals (ICA) affirmed the circuit court's
judgment on all counts.
issue for our review is whether Alexander was denied his
right to a jury trial when the circuit court decided the
underlying dispute by bench trial.
Alexander was constitutionally entitled to a trial by jury on
his action for declaratory judgment, and because the record
indicates that a jury trial was properly demanded and
preserved, we hold that the ICA gravely erred in affirming
the circuit court's decision to conduct a bench trial in
this case. As such, the ICA's March 23, 2016 judgment on
appeal, which affirmed the circuit court's October 25,
2010 partial final judgment, is vacated and remanded on the
ground that Alexander was entitled to a jury trial.
case arises from a partnership dispute between four siblings
over the operation of a family business, McCully Associates,
and the siblings' respective interests in the business.
Marn parents built a successful family business through Ala
Wai Investment, Inc., a Hawai'i corporation, and McCully
Associates (MA), a Hawai'i limited partnership. Ala Wai
Investment was the corporate general partner of MA, and MA
developed and managed various Marn properties, including the
McCully Shopping Center.
the Marn children (James, Alexander, Annabelle, and Eric)
served as limited partners and owned equal shares of MA.
Annabelle died in 1996 and her interest in MA was left to her
husband, James Dunn, as the trustee of the Annabelle Y. Dunn
Trust (AYD Trust). The underlying dispute in this case arose
between some of the Marn siblings and Dunn over
Annabelle's interest in MA.
Circuit Court Proceedings
the last seventeen years, various suits were brought by
members of the Marn family over the ownership and control of
MA and its properties. These suits were consolidated for
discovery and case management, but not for trial. Of the
cases that were filed, only Civil No. 98-4706-10 (the Buyout
case) and Civil No. 98-5371-12 (the Judicial Accounting
case)reached trial. On appeal for our review is
a single issue regarding the Buyout case.
October 29, 1998, Alexander and Eric filed the original
complaint for the Buyout case,  seeking both declaratory relief
and specific performance regarding the partners' rights
to buy-out Annabelle's interest in MA. Alexander and Eric
asserted that two agreements, the McCully Associates
Partnership Agreement (Partnership Agreement) and the
Transfer Restriction Agreement (Transfer Agreement), both
drafted in 1982 and signed by all siblings, were created
"to ensure that the Marn Properties would stay in the
to Alexander and Eric, under the Partnership and Transfer
Agreements, a partner was prohibited from disposing of his or
her interest in MA without first offering to sell his or her
interest to the other partners. Accordingly, Alexander and
Eric asserted that when Annabelle died and her interest in MA
passed to Dunn through the AYD Trust, Dunn was obligated to
offer to sell this interest in accordance with the terms of
the Partnership and Transfer Agreements.
such, under the heading "Claim for Declaratory Relief,
" Alexander and Eric made the following request for
25. Plaintiffs believe that the trustees of the Revocable
Trust, the personal representatives of the Estate of
Annabelle Dunn (Defendants James Dunn and Stephen Marn),
and/or such persons who currently hold Annabelle's
Partnership interests, are obligated to sell those interests
in accordance with the terms of the Partnership Agreement and
the Transfer Restriction Agreement[.]
26. In the alternative and if the sale of Annabelle's
Partnership interest has not been triggered by the foregoing
events, Plaintiffs believe that they were deceived or, at a
minimum, reasonably operated under a mistake of fact, in
their consent to the holding of Annabelle's interest in
the partnership in the name of the Revocable Trust. Had they
known that the Marn Properties would not be kept within the
Marn family, they would not have consented to the purported
27. Plaintiffs have deposited into escrow 1) earnest money
and 2) documents ready for execution, to effect and
facilitate the transfer of Annabelle's Partnership
interest as required by the foregoing agreements. The escrow
was ready to close on or before September 28, 1998.
Plaintiffs made demand upon James Dunn and Stephen Marn to
sell Annabelle's Partnership interest in accordance with
the foregoing agreements, but they refused to do so.
28. As a result, a genuine dispute has arisen between the
parties, which is ripe for decision. A decision at this time
will materially aid the parties in their own planning and in
the operation of the Partnership.
under the heading "Claim for Specific Performance,
" Alexander and Eric made the following request for
If the Court agrees that Defendants are obligated to sell
Annabelle's interest in the Partnership to the remaining
limited partners, then Plaintiffs request that the Court
enforce the terms of the purchase and sale provisions, as the
Plaintiffs are ready, willing and able to perform and they
have no adequate remedy at law, because the underlying asset
of the Partnership is real property, the loss of which cannot
be adequately compensated by damages. Plaintiffs pray
judgment as follows:
1. That process issue out of and under the seal of this
court, citing and summoning the defendants to appear and
respond as required by law; and
2. That the court determine that those Defendants who hold
the Partnership interest originally held in the name of
Annabelle Y. Dunn are obligated to sell the same to the
remaining limited partners; or, in the alternative,
3. That the Consent to Assignment of Annabelle's
Partnership interest to her Revocable Trust was ineffective
to waive Plaintiffs' rights to purchase Annabelle's
4. That this Court order the sale of the Annabelle Y. Dunn
partnership interests in McCully Associates to the other
limited partners of the Partnership at a price consistent
with sections 1, 2, 3 and 4 of the McCully Associates
Partnership Agreement and the Transfer Restriction Agreement
annexed as Exhibit "B" thereto.
5. For their cost of court, reasonable attorneys [sic] fees
and such other relief as is just.
December 4, 1998, the AYD Trust filed an answer to the
complaint, admitting that it had refused to sell
Annabelle's partnership interest and denying that
"any transfer of partnership interest is
'required.'" The AYD Trust also included in its
answer a demand for jury trial. On December 11, 1998, the AYD
Trust filed a first amended answer to the complaint, which
also included a jury demand.
October 15, 1999 and February 1, 2002 orders setting
trial for the Buyout case, it was noted that the case was set
for a jury trial.
of 2005, the court's appointed receiver for MA (the
Receiver) filed a motion for summary judgment or, in the
alternative, a motion to strike jury demands in the Buyout
and Judicial Accounting cases. Eric filed a
memorandum in opposition to the motion to strike jury demand,
which Alexander joined. In its order granting in part the
Receiver's motion for summary judgment, the
court concluded that it was unnecessary to
decide the jury issue at that point.
a pretrial hearing on August 24, 2005, the trial by jury
issue was discussed for the Buyout case. Wayne Sakai, counsel
for Eric and Linda Marn, argued that there should be a jury
trial for the Buyout case because there were factual and
legal issues that needed to be resolved. Steven Guttman,
counsel for Dunn,  argued that a jury trial had not been
demanded for the Buyout case and that there was no right to
demand a jury trial at this time. The circuit court agreed
[MR. SAKAI]: Your Honor, if I may address and add to what Mr.
Guttman and Mr. Freed said is we believe that another --the
third issue would be ripe for the Court's adjudication
without being enmeshed in the I.R.S. criminal investigation
would be the buy-out. . . . It just goes to the ability of
Eric and Alexander Marn's ability to buy-out the Dunn,
Annabelle Dunn's share.
And our position is that's a valid agreement, and that
should be heard by the Court. And if the Court hears that,
there's another catch to it is, I believe, that
there's factual determinations to be made in addition to
legal issues, than [sic] a jury trial should be warranted on
that aspect of it. Because it does not involve at all
the I.R.S. It does involve factual and legal issues, and I
think we need -- not I think, I -- I believe we need a
jury to determine the factual issues, and the Court to
determine the legal issues.
But the buy-out is very isolated, and it's very clean,
your Honor, very clean. And I think that requires a very
short jury trial that, basically, there's not too much
for the jury to determine. I think the factual issues
are there. If they want to do a stipulated facts, we can do
that, but I -- I don't think they want to do that. So
we need a jury to determine the facts of the case, but I
think that's a -- a document that cries out to be
adjudicated separate and apart from the I.R.S. issue.
The buy-out is very important, and it could have significant
impact upon the current mediation right now. I'm only