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Atooi Aloha, LLC v. Gaurino

United States District Court, D. Hawaii

October 19, 2018

ATOOI ALOHA, LLC, by Millicent Andrade and Craig B. Stanley, its Managing Members, et al., Plaintiffs,
v.
ABNER GAURINO, et al., Defendants.

          ORDER GRANTING DEFENDANT/THIRD-PARTY PLAINTIFF APT-320 LLC'S MOTION FOR CONFIRMATION OF SALE, DISTRIBUTION OF PROCEEDS, AND DEFICIENCY JUDGMENT; EXHIBIT A

          JIL A. OTAKE, UNITED STATES DISTRICT JUDGE.

         INTRODUCTION

         Defendant/Third-Party Plaintiff APT-320 LLC (“APT-320”) requests confirmation of the sale of the real property being foreclosed upon in this action, located at 3721 Kanaina Street, Honolulu, Hawaii TMK (1)-3-1-025-008 CPR 0088 (“Property”). APT-320 further requests that the Court: 1) determine reasonable expenses and attorneys' fees for the Commissioner; 2) determine other amounts due and owing for its other claims; 3) determine the priorities and claims of all other parties to this action; 4) enter a deficiency judgment in its favor if the sale proceeds are insufficient to pay its claims; 5) issue a judgment for possession and a writ of possession giving the purchaser possession of the Property; 6) deem abandoned any personal property found in the Property and authorize the purchaser to dispose of said personal property; 7) discharge the Commissioner following the conveyance and distributions and filing of the distribution statement; and 8) enter judgment pursuant to Federal Rule of Civil Procedure (“FRCP”) 54(b).

         For the reasons articulated below, the Court GRANTS the Motion.

         BACKGROUND

         As the Court and the parties are familiar with the history of this case, the Court includes only those facts relevant to the disposition of the instant Motion.

         On February 13, 2014, Plaintiff Atooi Aloha, LLC (“Atooi Aloha”) entered into an agreement to purchase 333 shares of Better Living Global Marketing (“BLGM”) in exchange for the conveyance of the Property to Defendant Abigail Gaurino (“Abigail”). Following the conveyance of the Property, Abigail obtained a $200, 000.00 mortgage on the property from Investors Funding Corporation (“IFC”), which IFC then assigned to APT-320.

         On January 31, 2018, Chief U.S. District Judge J. Michael Seabright issued an Order Re: Motions for Summary Judgment and Motion for Interlocutory Decree of Foreclosure (“SJ/Foreclosure Order”), Doc. No. 238, wherein he granted summary judgment in APT-320's favor and concluded that APT-320 established a prima facie case that it is entitled to foreclose on the mortgage.

         On March 1, 2018, Chief Judge Seabright issued a Foreclosure Decree. Doc. No. 262. In it, he ordered that the mortgage be foreclosed upon, that Thomas J. Wong be appointed as Commissioner, and that the Property be sold in a manner allowed by law.

         On September 20, 2018, the Commissioner filed his Report. Doc. No. 318. According to the Report, the Commissioner published a notice in the Honolulu Star-Advertiser, which contained a description of the Property, and location of the public auction. The auction took place on May 22, 2018, at noon, in front of the Judiciary Building, Honolulu, Hawaii. APT-320 presented the winning bid in the amount of $399, 000.00. The Commissioner recommends that this bid be confirmed and seeks compensation totaling $5, 414.53, which is comprised of $4, 425.00 in fees and $989.53 in expenses.

         On September 30, 2018, APT-320 filed the Motion for Confirmation of Sale, Distribution of Proceeds, and Deficiency Judgment (“the Motion”). Doc. No. 329.

         On October 10, 2018, APT-320 filed a Motion for Attorney's Fees and Costs, requesting $84, 219.86 in fees and $701.47 in costs. Doc. No. 340.

         LEGAL STANDARD

         Under Hawai‘i law, a “court's authority to confirm a judicial sale is a matter of equitable discretion.” Sugarman v. Kapu, 104 Haw. 119, 124, 85 P.3d 644, 649 (Haw. 2004) (quoting Brent v. Staveris, 7 Haw.App. 40, 45, 741 P.2d 722, 726 (Haw. Ct. App. 1987) (citation omitted)). In the absence of arbitrary action, courts enjoy broad discretion with respect to the confirmation of judicial sales. Id. (citation omitted). “In exercising its discretion, the ‘court should act in the interest of fairness and prudence, and with a just regard to the rights of all concerned and the stability of judicial sales.'” Brent, 7 Haw.App. at 45, 741 P.2d at 726 (quoting Hoge v. Kane II, 4 Haw.App. 533, 540, 670 P.2d 36, 40 (Haw. Ct. App. 1983)). Courts may deny the confirmation of a sale when the ...


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