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Dela Cruz v. Quemado

Supreme Court of Hawaii

January 23, 2018

FLORENCIO E. DELA CRUZ, ANASTACIA A. DELA CRUZ, and JENNIFER M. RESPECIO, Petitioners/Plaintiffs-Appellants,
v.
IRENE B. QUEMADO, MARVIN QUEMADO, JR., and BRYAN T. HIGA, Respondents/Defendants-Appellees.

         CERTIORARI TO THE INTERMEDIATE COURT OF APPEALS (CAAP-14-0000916; CIV. NO. 08-1-1089)

          Joseph P.H. Ahuna, Jr., and David K. Ahuna for petitioners

          Johnaaron Murphy Jones for respondent Irene B. Quemado

          RECKTENWALD, C.J., NAKAYAMA, McKENNA, POLLACK, AND WILSON, JJ.

          OPINION

          RECKTENWALD, C.J.

         I. Introduction

         While this case concerns civil claims arising from an armed robbery, our decision focuses on the circuit court's entry of default and subsequent decisions regarding the default.

          On the afternoon of June 1, 2006, jewelry business owners Florencio Dela Cruz and Anastacia Dela Cruz ("the Dela Cruzes") were robbed at gunpoint by Marvin Quemado, Jr. ("Marvin"), and Bryan Higa ("Higa"). Marvin and Higa were indicted in federal court and pled guilty to conspiracy to commit robbery, robbery, and using and carrying a firearm during and in relation to the robbery.

         In May 2008, the Dela Cruzes and their daughter, Jennifer Respecio (together, "Petitioners"), filed a civil suit against Irene Quemado ("Irene"), Marvin's mother, alleging that Irene was negligent because she invited the Dela Cruzes to her home and exposed her son Marvin to the Dela Cruzes' valuable jewelry.[1] Petitioners contended that Irene's actions unreasonably increased the risk that Marvin would rob the Dela Cruzes. Petitioners argued that, based on Marvin's history of drug abuse and felony convictions for possession and promotion of drugs, Marvin's actions were foreseeable, and thus, Irene had a duty to control Marvin's conduct to prevent "foreseeable harm."

         Irene answered, and the case proceeded in litigation for a number of years. However, after Irene and her attorney failed to appear at a scheduled settlement conference in February 2013, the Circuit Court of the First Circuit entered default against Irene.[2] Irene moved for reconsideration of the entry of default and to set aside the entry of default, and the circuit court denied both motions.

         Petitioners moved for entry of default judgment against Irene. Although the circuit court had entered the default against Irene, and denied her motion to set aside the entry of default, it denied Petitioners' motion for entry of default judgment. In the order denying Petitioners' motion to enter default judgment against Irene, the circuit court also sua sponte dismissed Petitioners' claims against Irene with prejudice. Subsequently, the circuit court entered final judgment against Petitioners as to their claims against Irene.

         The Intermediate Court of Appeals (ICA) affirmed the circuit court's decision denying entry of default judgment, based on the merits of Petitioners' negligence case. Dela Cruz v. Quemado, 137 Hawai'i 36, 42, 364 P.3d 934, 940 (App. 2015).

         In their application for writ of certiorari, Petitioners presented questions related to foreseeability and the standard of evidence used by the ICA. We accepted certiorari and requested supplemental briefing on whether the circuit court: (1) abused its discretion in entering default against Irene, (2) abused its discretion in not setting aside the entry of default against Irene, and (3) erred in sua sponte dismissing Petitioners' claims and then entering judgment against Petitioners.

         We hold that the circuit court abused its discretion in entering default against Irene and in failing to set aside the entry of default. We further hold that the circuit court erred in sua sponte dismissing Petitioners' claims with prejudice and entering final judgment against them. As set forth below, we therefore vacate and remand the case for further proceedings consistent with this opinion.

         II. Background

         A. Negligence Claim

         On May 30, 2008, Petitioners filed a complaint in circuit court against Irene Quemado, Marvin Quemado, and Bryan Higa.[3] The following allegations are set forth in the complaint:

         Petitioners Florencio and Anastacia Dela Cruz were the owners of Flor and Annie Jewelry. On June 1, 2006, the Dela Cruzes went to Irene Quemado's house at Irene's invitation, to exchange jewelry. Irene invited her son Marvin to examine and try on some of the jewelry. The complaint alleged that Marvin "had a criminal history of using and promoting illegal drugs, including felony convictions for possessing and promoting drugs, and was on parole/probation for his felony drug conviction[.]"

         Marvin examined the jewelry and asked if he could try on a gold necklace. Marvin took the necklace upstairs and was gone for about twenty minutes before Irene went upstairs to check on him. According to the complaint, while he was upstairs, Marvin "conspired and devised a plan" with Higa to rob the Dela Cruzes of their jewelry.

         The Dela Cruzes left Irene's house and arrived at their next appointment at a nearby restaurant, where Higa robbed Florencio at gunpoint. Marvin and Higa were later arrested and indicted in federal court, where they pled guilty to multiple charges related to the robbery.

         Petitioners contended that Irene was negligent in exposing Marvin to the jewelry because it unreasonably increased their risk of harm. They asserted that Irene knew "or should have known" about Marvin's drug use, and that Marvin "had a gun and associated with violent criminals, such as [Bryan] Higa." Thus, they contended that Irene should be held liable because Marvin's actions were "foreseeable" given his prior history of drug use and felony convictions for possession and promotion of drugs.

         Irene filed a motion to dismiss the complaint for failure to state a claim. She argued that the complaint failed to allege that she engaged in any of the criminal actions of the other defendants. She asserted that she did not know of or engage in any misconduct, and that her son, Marvin, was over eighteen years of age at the time of the robbery.

         The circuit court denied Irene's motion to dismiss in December 2009. Throughout 2010 and 2011, the parties corresponded regarding the applicability of Irene's insurance policy to the case. Petitioners moved for and were granted six continuances to file their pretrial statement. Petitioners filed a pretrial statement in December of 2011, and Irene filed her pretrial statement on January 18, 2012. Irene argued, inter alia, that she had no duty to Petitioners, that she did not breach any duty, that she did not cause Petitioners' injury, and that she was "not liable for the unforeseeable acts of third parties."

         B. Default

         1. Entry of Default

         On February 17, 2012, Petitioners filed a request and notice for a trial setting status conference. The trial setting status conference was scheduled for March 15, 2012. A March 14, 2012, minute order provides that "off-by agreement, trial setting status conference continued to: 4/10/11, [4] 8:30 am. Mr. Jones informed to file an amended notice."[5] The record reflects that Johnaaron M. Jones, Irene's attorney, did not file the amended notice. Jones did not attend the trial setting status conference on April 10, 2012. The court set the dates for a settlement conference, a trial readiness conference, trial, and motion in limine deadlines. The scheduled dates were included in the court minutes, and the court issued a trial setting status conference order setting forth the following dates: the settlement conference on February 13, 2013, the trial readiness conference on March 13, 2013, and trial the week of April 8, 2013.

         Irene and Jones failed to appear at the scheduled settlement conference on February 13, 2013.[6] As a sanction for her failure to appear, the circuit court entered an order of entry of default against Irene, citing Rules of the Circuit Courts of the State of Hawai'i (RCCH) Rule 12.1(a)(6).[7] The February 13, 2013 court minutes state:

The court took judicial notice of the records and files and history of this case and noted the nonappearance of Mr. Jones on the Trial Setting Status Conference of 4/12/12 where a copy of the TSSC order was mailed to him.[8]
. . .
The court also noted the last appearance by Mr. Jones was the 1/18/12 filing of Defendant's pretrial statement.
Court held colloquy with [Petitioners' counsel] re: contacts with Mr. Jones.
The court further noted no withdrawal was filed by Mr. Jones.
Court finds sanctions under 12.1(6) is appropriate and will hold defendant in default . . .

         The circuit court also based its order on its finding that Irene and her attorney had "failed to discuss or attempt to negotiate a settlement prior to the conference, failed to have a person authorized to settle the case present at the conference, and failed to deliver a confidential settlement letter to the Judge" prior to the conference. In its order of entry of default, filed March 6, 2013, the circuit court stated that it found no good cause for Jones's "series of failures and neglect." In addition to ...


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