United States District Court, D. Hawaii
FINDINGS AND RECOMMENDATION TO GRANT
DEFENDANT/THIRD-PARTY PLAINTIFF APT-320 LLC'S MOTION FOR
ATTORNEY'S FEES AND COSTS 
Richard L. Puglisi United States Magistrate Judge
the Court is Defendant/Third-Party Plaintiff APT-320
LLC's Motion for Attorney's Fees and Costs, filed on
October 10, 2018 (“Motion”). See ECF No.
340. In the Motion, APT-320 LLC requests an award of
attorney's fees and costs against Defendant Abigail
Gaurino. Id. Defendant Cristeta C.
filed a Statement of No. Opposition on October 12, 2018. ECF
No. 342. Plaintiffs filed a Statement indicating that they
did not oppose the requested fees and costs as against
Defendant Abigail Gaurino only, and not against Plaintiffs,
on October 15, 2018. ECF No. 345. Defendants Abner Gaurino,
Abigail Gaurino, and Aurora Gaurino filed a Statement of No.
Opposition to the Motion on October 16, 2018. ECF No. 348.
Third-Party Defendant Association of Apartment Owners of
Diamond Head Sands' filed a Statement of No. Position to
the Motion on November 19, 2018. ECF No. 356. No. other
parties filed a response to the Motion and the time for
filing such a response has expired. This matter is suitable
for disposition without a hearing pursuant to Local Rule
7.2(d). After careful consideration of the Motion and the
relevant authority, the Court FINDS AND RECOMMENDS that
APT-320 LLC's Motion be GRANTED.
purposes of this Motion, the Court only recites those
background facts related to APT-320 LLC's claims against
Defendant Abigail Gaurino. On February 13, 2014, Plaintiff
Atooi Aloha, LLC entered into an agreement to purchase shares
in exchange for the conveyance of certain real property
located at 3721 Kanaina Street, Honolulu, Hawaii TMK
(1)-3-1-025-008 CPR0088 (“the Property”) to
Defendant Abigail Gaurino. Following the conveyance of the
Property, Defendant Abigail Gaurino obtained a $200, 000 Note
and Mortgage on the Property from Investors Funding
Corporation, which were then assigned to APT-320 LLC.
action, summary judgment was granted in favor of APT-320 LLC
on its claim of foreclosure. See ECF No. 238, 262.
The Property was then sold, the sale was confirmed by the
district court, and a judgment for possession was entered.
See ECF Nos. 350, 351.
present Motion, APT-320 LLC requests attorney's fees and
costs against Defendant Abigail Gaurino related to its
foreclosure claim in this action and also for attorney's
fees and costs that it incurred in pursuing a foreclosure
action in Hawaii state court. See ECF No. 340-1.
diversity cases, the Court must apply state law in
determining whether the prevailing party is entitled to
attorneys' fees. Kona Enters., Inc. v. Estate of
Bishop, 229 F.3d 877, 883 (9th Cir. 2000). Under Hawaii
law, “[o]rdinarily, attorneys' fees cannot be
awarded as damages or costs unless so provided by statute,
stipulation, or agreement.” Stanford Carr Dev.
Corp. v. Unity House, Inc., 141 P.3d 459, 478 (Haw.
2006) (citing Weinberg v. Mauch, 890 P.2d 277, 290
APT-320 LLC seeks an award of fees under Hawaii Revised
Statutes Section 607-14. Section 607-14 provides that
attorneys' fees shall be awarded “in all actions in
the nature of assumpsit and in all actions on a promissory
note or other contract in writing that provides for an
attorney's fee.” Haw. Rev. Stat. § 607-14.
Section 607-14 also provides that such fees shall “not
exceed twenty-five per cent of the judgment.” Haw. Rev.
Stat. § 607-14. To award attorneys' fees under
Section 607-14, the court must determine whether: (A) the
action is in the nature of assumpsit; (B) APT-320 LLC is the
prevailing party; (C) the fees requested are reasonable; and
(D) the fees do not exceed twenty-five percent of the
Action in the Nature of Assumpsit or Action on a Promissory
Note or Other Contract in Writing That Provides for an
LLC states, without any discussion, that its crossclaim
against Defendant Abigail Gaurino for foreclosure is in the
nature of assumpsit. ECF No. 340-1 at 6. Based on the
Court's review of the applicable Hawaii case law, actions
for foreclosure have routinely been held to be statutory,
rather than contractual, in nature, and therefore, not in the
nature of assumpsit. See, e.g., James
B. Nutter & Co. v. Domingo, 388 P.3d 47 (Haw. Ct.
App. 2016) (“Because the basis for [plaintiff's]
requested relief of the right to foreclose was statutory
rather than contractual, the portion of [plaintiff's]
action dealing with its right to foreclose on the property
does not fall within HRS § 607-14.”); see
also Order Re: Motions for Summary Judgment and Motion
for Interlocutory Decree of Foreclosure, ECF No. 238 (citing
Hawaii Revised Statutes § 667-1.5, the statutory
provision providing for foreclosure by judicial action, in
granting APT-320 LLC's motion for summary judgment).
in this action, APT-320 LLC's crossclaim for foreclosure
did not solely rely on its statutory right to foreclose, but
also alleged that Defendant Abigail Gaurino defaulted on the
Note and Mortgage. See ECF No. 40-1. Both the Note
and Mortgage contain provisions providing for an award of
attorney's fees to the prevailing party. ECF No. 340-3 at
2 (providing that the borrower defaults on the Note,
“the Note holder will have the right to be paid back
for all its reasonable costs and expenses. Those expenses
include, for example, reasonable attorney's fees and
collection agency fees.”); ECF No. 340-4 at 4
(providing that the mortgager “will pay all expenses,
including reasonable attorneys' fees, incurred by the
Mortgagee, whether in litigation or otherwise, to sustain the
lien or priority of this Mortgage, or to protect or enforce
any of the Mortgagee's rights hereunder”).
Accordingly, the Court finds that APT-320 LLC's claim for
foreclosure against Defendant Abigail Gaurino was an action
on a contract in writing that provides for an attorney's
fee and APT-320 LLC is eligible for an award of
attorney's fees under that provision of Section 607-14.