Wheels of Justice, LLC v. Title Guaranty Escrow Services, Inc.

Electronically Filed
Intermediate Court of Appeals
CAAP-XX-XXXXXXX
20-MAR-2024
08:46 AM
Dkt. 89 SO

NO. CAAP-XX-XXXXXXX

IN THE INTERMEDIATE COURT OF APPEALS

OF THE STATE OF HAWAIʻI

WHEELS OF JUSTICE, LLC, a Nevada limited liability company,
Plaintiff-Appellant,
v.
TITLE GUARANTY ESCROW SERVICES, INC., Defendant/Crossclaim
Defendant/Crossclaimant/Third-Party Plaintiff-Appellee;
ISLAND TITLE CORPORATION, Defendant/Crossclaimant/Third-Party
Plaintiff/Crossclaim Defendant-Appellee;
CLINTON HINCHCLIFF, JR., Defendant/Crossclaim Defendant-
Appellee; CLINTON HINCHCLIFF, SR., Defendant/Crossclaim
Defendant-Appellee; HINCHCLIFF INVESTMENTS LLC,
Defendant/Crossclaim Defendant-Appellee;
NIMBLE LAND, INC., a Hawaii Corporation, Third-Party
Defendant/Crossclaimant-Appellee;
and
JOHN AND JANE DOES 1-20; DOE CORPORATIONS, PARTNERSHIPS,
and/or OTHER ENTITIES 1-20, Defendants

APPEAL FROM THE CIRCUIT COURT OF THE THIRD CIRCUIT
(CASE NO. 3CC09100178K)

SUMMARY DISPOSITION ORDER
(By: Hiraoka, Presiding Judge, Wadsworth and Guidry, JJ.)
NOT FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER

This matter involves a dispute concerning a real

property transaction. Plaintiff-Appellant Wheels of Justice,

LLC (WOJ) appeals from the Amended Final Judgment, filed

March 27, 2019 (Amended Judgment), entered by the Circuit Court

of the Third Circuit (circuit court).1

WOJ contends on appeal that the circuit court erred in

granting summary judgment in favor of Title Guaranty Escrow

Services, Inc. (Title Guaranty), and Island Title Corporation

(Island Title).2 Upon careful review of the record and relevant

legal authorities, and having given due consideration to the

arguments advanced and the issues raised by the parties, we

affirm the circuit court's Amended Judgment.

"On appeal, the grant or denial of summary judgment is

reviewed de novo." Ralston v. Yim, 129 Hawaiʻi 46, 55, 292 P.3d

1276, 1285 (2013) (citations omitted). The court applies the

following standard,

[S]ummary judgment is appropriate if the pleadings,
depositions, answers to interrogatories and admissions on
file, together with the affidavits, if any, show that there
is no genuine issue as to any material fact and that the
moving party is entitled to judgment as a matter of law. A
fact is material if proof of that fact would have the

1 The Honorable Robert D.S. Kim presided. The Honorable Ronald
Ibarra initially presided over this case through 2017.

2 WOJ presents no discernible argument in support of its contention
that "[b]y granting summary judgment to the Appellees , [sic] the Circuit
Court violated [WOJ's] constitutional rights to due process and equal
protection by denying it property, possession, and ownership interests." We
thus decline to address that contention. In re Guardianship of Carlsmith,
113 Hawaiʻi 236, 246, 151 P.3d 717, 727 (2007) ("[An appellate] court may
disregard a particular contention if the appellant makes no discernible
argument in support of that position." (cleaned up)).

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NOT FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER

effect of establishing or refuting one of the essential
elements of a cause of action or defense asserted by the
parties. The evidence must be viewed in the light most
favorable to the non-moving party. In other words, we must
view all of the evidence and inferences drawn therefrom in
the light most favorable to the party opposing the motion.

Id., at 55-56, 292 P.3d at 1285-86.

WOJ challenges the circuit court's entry of separate

Findings of Fact, Conclusions of Law, and Order dated

December 11, 2018 (December 2018 Order), and January 30, 2019

(January 2019 Order), respectively. The December 2018 Order

awarded summary judgment in favor of Title Guaranty and against

WOJ. The January 2019 Order awarded summary judgment in favor

of Island Title and against WOJ.

As the record reflects, Title Guaranty and Island

Title satisfied their initial burden of production. Title

Guaranty and Island Title provided evidence, including copies of

the escrow and title insurance paperwork, showing that the

parties to the property transaction at issue were Nimble Land,

Inc. (Nimble) and Hinchcliff Investments LLC (Hinchcliff); WOJ

was not a party. Ralston, 129 Hawaiʻi at 60, 292 P.3d at 1290

("[A] summary judgment movant may satisfy his or her initial

burden of production by either (1) presenting evidence negating

an element of the non-movant's claim, or (2) demonstrating that

the nonmovant will be unable to carry his or her burden of proof

at trial." (citations omitted)).

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NOT FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER

The burden then shifted to WOJ. Kondaur Cap. Corp. v.

Matsuyoshi, 136 Hawaiʻi 227, 240-41, 361 P.3d 454, 467-68 (2015)

("Only with the satisfaction of [movant's] initial showing does

the burden shift to the [non-moving] party to respond by

affidavits or as otherwise provided in [Hawaiʻi Rules of Civil

Procedure] Rule 56, setting forth specific facts showing that

there is a genuine issue for trial.") (cleaned up) (underscore

omitted). WOJ did not meet its burden of establishing that,

notwithstanding its non-party status, there exists a genuine

issue of material fact for trial.

First, WOJ did not establish a genuine issue of

material fact as to whether Title Guaranty owed any duty to WOJ,

a non-party to the property transaction and/or escrow agreement.

Pursuant to well-established law, Title Guaranty, as escrow, had

a fiduciary duty to faithfully comply with the instructions of

the parties to the escrow agreement. DeMello v. Home Escrow,

Inc., 4 Haw. App. 41, 47, 659 P.2d 759, 763 (App. 1983) ("The

general rule is that an escrow depository occupies a fiduciary

relationship with the parties to the escrow agreement or

instructions and must comply strictly with the provisions of

such agreement or instructions." (citations omitted)).

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NOT FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER

Second, WOJ did not establish a genuine issue of

material fact as to whether Island Title owed any duty to WOJ, a

non-party to the property transaction and title insurance

agreement. Island Title acted as the authorized issuing agent

for First American Title Insurance Company, with the role of

facilitating the issuance of title insurance to Hinchcliff in

its property transaction with Nimble. See Chun v. Park,

51 Haw. 462, 464, 462 P.2d 905, 907 (1969) (imposing upon title

company, towards buyer and lender, "a duty to use reasonable or

ordinary care in the preparation of the certificate of title

search[.]"). Island Title did so with buyer Hinchcliff's

written agreement that the sale would be subject to WOJ's claim.3

3 WOJ's recordation and notice of the lis pendens did not create a
duty on the part of Title Guaranty or Island Title towards WOJ. The lis
pendens provided notice to the buyer of the property, Hinchcliff, of WOJ's
pending lawsuit. The lis pendens did not impose a duty upon Title Guaranty
or Island Title to prevent the closing of the property sale. IndyMac Bank v.
Miguel, 117 Hawaiʻi 506, 521, 184 P.3d 821, 836 (App. 2008) ("The doctrine of
lis pendens is intended to protect a claimed interest in property from being
defeated by a subsequent sale to a bona fide purchaser during the course of
litigation." (citation omitted)). In this case, the sale proceeded – at the
parties' instruction – with Hinchcliff's written agreement that the sale
would be subject to WOJ's claim.

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NOT FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER

For the foregoing reasons, we affirm the circuit

court's Amended Judgment.

DATED: Honolulu, Hawaiʻi, March 20, 2024.

On the briefs: /s/ Keith K. Hiraoka
Presiding Judge
R. Steven Geshell,
for Wheels of Justice, LLC /s/ Clyde J. Wadsworth
a Nevada limited Associate Judge
liability company,
Plaintiff-Appellant. /s/ Kimberly T. Guidry
Associate Judge
Charles A. Price,
for Title Guaranty Escrow
Services, Inc.,
Defendant/Crossclaim
Defendant/Crossclaimant/
Third-Party Plaintiff-Appellee.

Regan M. Iwao,
for Island Title Corporation,
Defendant/Crossclaimant/
Third-Party Plaintiff/Crossclaim
Defendant-Appellee.

Peter Knapman
for Clinton Hinchcliff, Jr.,
Clinton Hinchcliff, Sr., and
Hinchcliff Investments LLC,
Defendants/Crossclaim Defendants-
Appellees.

John R. Remis, Jr.
for Nimble Land, Inc.,
a Hawaii Corporation,
Third-Party Defendant/
Crossclaimant-Appellee.

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