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Deutsche Bank National Trust Co. v. Greenspon

Supreme Court of Hawaii

September 17, 2018

MICHAEL C. GREENSPON, Petitioner/Defendant-Appellant.


          Michael C. Greenspon pro se.

          J. Blaine Rogers Jenny J.N.A. Nakamoto for respondent/plaintiff-appellee.



          POLLACK, J.

         This case considers whether a motion for sanctions may be dismissed without prejudice when the underlying facts and issues allegedly establishing the sanctionable conduct are also at issue in another pending case involving the same parties. We also consider whether a final order must be signed by a district court clerk or judge for an appeal to lie from that order. We conclude that the trial court acted within its proper discretion when it dismissed the motion for sanctions without prejudice. We further hold that the signature of a court clerk or judge is generally necessary for appellate review of a final order. In the circumstances of this case, however, we determine that other signed filings related to the order being appealed were sufficient to provide appellate jurisdiction.


         On March 31, 2003, Michael C. Greenspon obtained a loan from IndyMac Bank, F.S.B. (IndyMac) that was secured by a mortgage (the Mortgage) encumbering the property acquired by Greenspon (the Property). The Mortgage states that the promissory note for the loan (the Note) was made payable to IndyMac, and it identifies IndyMac as the mortgagee/lender. On July 11, 2008, IndyMac was closed by the Federal Deposit Insurance Corporation (FDIC). Upon IndyMac's closure, IndyMac Federal Bank, F.S.B. (IndyMac Federal) was assigned IndyMac's interest in the Mortgage.

         In late 2008, Greenspon defaulted on the Note. IndyMac Federal subsequently instituted a non-judicial foreclosure sale. A notice of foreclosure was recorded in the Bureau of Conveyances, and a public auction of the Property was scheduled.

         The foreclosure auction was conducted in early 2010. An affidavit regarding the foreclosure sale (Affidavit of Sale) identified "FDIC as Receiver for IndyMac Federal Bank, FSB" as mortgagee and Greenspon as mortgagor. The highest bidder at the auction was listed as "Deutsche Bank National Trust Company" (Deutsche Bank). A deed was filed in the Bureau of Conveyances, identifying the grantor as FDIC as Receiver for "IndyMac Bank, FSB" and the grantee as Deutsche Bank (the Deed). Deutsche Bank then mailed a written notice to vacate to the occupants of the Property. Greenspon remained on the premises.

         A. Ejectment Complaint, Motion for Summary Judgment, and Motion to Dismiss

         Deutsche Bank filed a Verified Complaint for Ejectment (ejectment action) against Greenspon in the District Court of the Second Circuit, Lahaina Division (district court) seeking a judgment and writ of possession for the Property. Deutsche Bank subsequently filed a Motion for Summary Judgment and Writ of Possession (Motion for Summary Judgment) asserting that, through its purchase at the non-judicial foreclosure sale, it became the fee simple owner of the Property and was entitled to possession.

         In response to the Motion for Summary Judgment, Greenspon filed a motion to dismiss based on lack of subject matter jurisdiction by the district court and an opposition to the Motion for Summary Judgment (Motion to Dismiss). Greenspon challenged the validity of Deutsche Bank's interest in the Property, arguing, inter alia, that IndyMac's assignment of the Mortgage to IndyMac Federal was fraudulently conducted seven months after the FDIC's closure of IndyMac. Further, Greenspon asserted, the Deed conflicted with the Affidavit of Sale because the Deed listed "FDIC as Receiver for IndyMac Bank, FSB" as the grantor whereas the Affidavit of Sale listed "FDIC as Receiver for IndyMac Federal, F.S.B." as the mortgagee. Thus, Greenspon contended, neither IndyMac nor IndyMac Federal had contractual authority to conduct the power of sale or the non-judicial foreclosure conveying the Property to Deutsche Bank. Because title to the Property was in dispute, Greenspon concluded, summary judgment was inappropriate and the district court lacked jurisdiction under Hawaii Revised Statutes (HRS) § 604-5(d) (1993)[1] to hear the case.

         Greenspon also filed a complaint in the Circuit Court of the First Circuit (circuit court action) naming Deutsche Bank; IndyMac Federal; OneWest Bank, F.S.B.; and Cal-Western Reconveyance Corporation as defendants and asserting various claims of fraud pertaining to the title of the Property.[2]

         At the hearing on the Motion for Summary Judgment, [3]Greenspon requested that the district court take judicial notice of his circuit court action. The district court accepted a copy of the circuit court action complaint, but, finding Deutsche Bank had met its burden for summary judgment, orally granted Deutsche Bank's Motion for Summary Judgment.

         Deutsche Bank subsequently filed its opposition to Greenspon's Motion to Dismiss. Deutsche Bank argued that the oral ruling granting Deutsche Bank summary judgment rendered the Motion to Dismiss moot.

         The district court, however, granted Greenspon's Motion to Dismiss and dismissed the case without prejudice (Dismissal Order).[4] The Dismissal Order stated that the district court had taken judicial notice of the circuit court action and that the district court lacked subject matter jurisdiction over Deutsche Bank's ejectment action because title to the Property was in dispute. The district court also vacated the oral ruling granting Deutsche Bank's Motion for Summary Judgment.

         B. Greenspon's Motion for Sanctions

         In June 2014, Greenspon submitted a motion for costs and attorney's fees based upon District Court Rules of Civil Procedure (DCRCP) Rule 11 (1996)[5] (Motion for Sanctions) for the filing of a "false verified complaint." Relying upon evidence and proceedings in the circuit court action, Greenspon argued that Deutsche Bank had no right to possession of the Property and that its counsel negligently and recklessly failed to make any reasonable inquiry into the validity of Deutsche Bank's title claims prior to filing the ejectment action.[6] Thus, Greenspon argued, sanctions against both Deutsche Bank and its counsel were necessary because the ejectment action lacked a factual basis, was frivolous, and was brought for improper purposes. Accordingly, Greenspon requested that the district court impose DCRCP Rule 11 sanctions and enter an award for all attorney's fees and costs Greenspon incurred in defending the ejectment action, with interest.

         In response, Deutsche Bank argued that its claims were not frivolous and that the district court granted Greenspon's Motion to Dismiss primarily to allow the circuit court action to be fully litigated and resolved. Any issues regarding title raised by Greenspon in the Motion for Sanctions, Deutsche Bank maintained, were determinations made in the circuit court action that was then pending appeal and were thus beyond the district court's jurisdiction. Deutsche Bank therefore contended that the district court should not grant Greenspon's Motion for Sanctions.[7]

         The district court held a hearing on the Motion for Sanctions and issued an order denying the motion without prejudice (Order Denying Sanctions).[8] In a footnote in the order, the district court explained that the denial was without prejudice because the Motion for Sanctions raised issues of title that were pending appeal in Greenspon's circuit court action:

As represented by counsel for [Deutsche Bank] in the Opposition, Greenspon v. Deutsche Bank National Trust Company, CAAP-13-0001432, is currently on appeal. As the Court understands, that case involves among other things, issues relating directly to the issue of title to the subject property. The outcome of said appeal may have a direct bearing upon the instant case. Accordingly, unless and until a decision has been made on said appeal, the [Motion for Sanctions] may be premature and is therefore being denied without prejudice.

         C. Greenspon's Motion for Taxation of Costs

         On September 9, 2014, Greenspon filed an ex parte request for taxation of costs (Request for Costs) citing DCRCP Rule 54(d) (1996) [9] and HRS §§ 607-9[10] and 607-13 (1993).[11]Greenspon also filed a proposed "Order Granting Prevailing Defendant's Ex Parte Request for Taxation of Costs" (Proposed Order for Costs). In the Request for Costs, Greenspon stated his costs as $1, 695.61 through the termination of the ejectment action. He provided documentation supporting his request, including, inter alia, a copy of the minutes from a hearing on Deutsche Bank's motion for reconsideration of the order granting Greenspon's Motion to Dismiss at which the court indicated that it would consider a request for costs from Greenspon when submitted.

         Deutsche Bank opposed the Request for Costs, arguing that imposition of costs was inequitable because the district court had first orally granted Deutsche Bank's Motion for Summary Judgment and later reversed its ruling. Greenspon thereafter submitted a proposed "Judgment and Notice of Entry of Judgment" for an award of the requested costs (Proposed Judgment Regarding Costs) to the court.

         On September 22, 2014, the district court stamped the Proposed Order for Costs "DENIED" and "FILED" (Order Denying Request for Costs). The next day, the district court stamped the Proposed Judgment Regarding Costs "DENIED" and "FILED" (Denial of Proposed Judgment). Neither document was signed by a clerk or judge on the signature line provided for the "judge or clerk of the above-entitled court."

         The Denial of Proposed Judgment is accompanied in the record on appeal by a Second Circuit preprinted "denial form" (Denial Form). The Denial Form provides a blank line for a civil case number that was filled in with "10-1-2608" and bears a typewritten notation that reads, "This document is denied for the following reason(s)." Various reasons for which a document may be denied are listed along with checkboxes to indicate the applicable reason for denial. One of the checkboxes is designated "Other" and includes lines upon which to write a reason. The space for "Other" on the Denial Form was marked, and next to it was handwritten: "No judgment granted on Defendant's Sept. 9, 2014 Request for Taxation of Costs." Underneath the signature line of the Denial Form is typewritten "Judge of the above-entitled Court," and a handwritten signature appears on the signature line.[12]

         Greenspon appealed, inter alia, the district court's Order Denying Sanctions and the Order Denying Request for Costs.


         Greenspon and Deutsche Bank reasserted their arguments related to the Motion for Sanctions to the Intermediate Court of Appeals (ICA). Regarding the denial of the Request for Costs, Greenspon contended that there is a strong presumption that costs will be awarded to the prevailing party and a court may not deny costs without explanation unless it is clear from the record that the denial of costs is justified. Here, Greenspon argued, the district court failed to provide any reasoning for denying his Request for Costs. Deutsche Bank responded that it would be inequitable to award Greenspon any costs because Greenspon filed the Request for Costs three years after the Motion to Dismiss was granted and because the district court had wrongfully vacated its ruling granting Deutsche Bank's Motion for Summary Judgment prior to dismissing the case.

         On November 30, 2017, the ICA issued a summary disposition order (SDO) .[13] As to the Order Denying Sanctions, the ICA noted that Greenspon's circuit court action against Deutsche Bank asserted claims for wrongful foreclosure and quiet title; injunctive relief; unfair and deceptive acts and practices; and fraud. The evidence Greenspon relied on to question Deutsche Bank's validity of title and right to possession in the Motion for Sanctions, the ICA stated, derived from discovery and filings in the circuit court action. Thus, the ICA determined that the issues raised in the Motion for Sanctions were the subject of ongoing litigation and that the district court did not abuse its discretion by denying the Motion for Sanctions without prejudice.[14]

         Regarding the denial of Greenspon's Request for Costs, the ICA found that it lacked jurisdiction to review the matter. The ICA described the Order Denying Request for Costs from which Greenspon sought to appeal as a "taxation of costs document" stamped "DENIED" but without any signature by a district court clerk or judge. Because the document lacked the district court clerk or judge's signature required under HRS § 604-20 (2016), [15]the ICA stated it was not an order subject to appellate review under Hawai'i Rules of Appellate Procedure (HRAP) Rule 4 (a) (2016), which requires an appeal from an "entry of judgment or appealable order". The ICA accordingly held that it did not have jurisdiction to consider an appeal of the Order Denying Request for Costs.

         Greenspon filed, and this court accepted, an application for writ of certiorari from the ICA's decision.


         DCRCP Rule 11 is substantially similar to Hawai'i Rules of Civil Procedure (HRCP) Rule 11 (2000), and like HRCP Rule 11, "[a]11 aspects of a [DRCRP] Rule 11 determination should be reviewed under the abuse of discretion standard." Canalez v. Bob's Appliance Serv. Ctr., Inc., 89 Hawai'i 292, 300, 972 P.2d 295, 303 (1999) (quoting ...

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