Deutsche Bank National Trust Company v. Yata

• Court: Hawaii Intermediate Court of Appeals
• Decided: June 9, 2022
• Docket: CAAP-18-0000922
• Status: Published

Opinion

NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

Electronically Filed Intermediate Court of Appeals CAAP-XX-XXXXXXX 09-JUN-2022 07:53 AM Dkt. 62 SO

NO. CAAP-XX-XXXXXXX

IN THE INTERMEDIATE COURT OF APPEALS

OF THE STATE OF HAWAI#I

DEUTSCHE BANK NATIONAL TRUST COMPANY AS TRUSTEE FOR MORGAN STANLEY ABS CAPITAL I INC. TRUST 2006-NC4, Plaintiff-Appellee, v. BLAINE T. YATA, Defendant-Appellant, and BROOKE J.C. RIOPTA; AMBER M. RIOPTA; CASIE A. RIOPTA, COUNTY OF KAUAI WASTEWATER MANAGEMENT; AND DOES 1-20, inclusive, Defendants

APPEAL FROM THE CIRCUIT COURT OF THE FIFTH CIRCUIT (CASE NO. 14-1-0185)

SUMMARY DISPOSITION ORDER (By: Ginoza, Chief Judge, Leonard and Wadsworth, JJ.)

Defendant-Appellant Blaine T. Yata (Yata) appeals from

the November 1, 2018 Order Denying [Yata's] Motion for Rehearing

and/or Reconsideration of this Court's Decision Granting

Plaintiff's Motion for Summary Judgment as Against

all Defendants and for Interlocutory Decree of Foreclosure (Order

Denying Reconsideration) (quotation marks deleted) entered by the NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

Circuit Court of the Fifth Circuit (Circuit Court).1 Yata also

challenges the Circuit Court's Findings of Fact; Conclusions of

Law; Order Granting Plaintiff's Motion for Summary Judgment as

Against All Defendants and for Interlocutory Decree of

Foreclosure (Foreclosure Decree), and Judgment, both entered on

July 19, 2018.

Yata raises a single point of error on appeal,

contending that Plaintiff-Appellee Deutsche Bank National Trust

Company, as Trustee for Morgan Stanley ABS Capital I Inc. Trust

2006-NC4 (Deutsche Bank) failed to establish its standing to

foreclose against Yata, and therefore, the Circuit Court erred in

entering the Order Denying Reconsideration, as well as the

Foreclosure Decree and Judgment.

Upon careful review of the record and the briefs

submitted by the parties, and having given due consideration to

the arguments advanced and the issues raised by the parties, we

resolve Yata's point of error as follows:

On April 17, 2018, Deutsche Bank filed Plaintiff's

Motion for Summary Judgment as Against All Defendants and for

Interlocutory Decree of Foreclosure, along with a supporting

memorandum, declaration and exhibits (Motion for Summary

Judgment); a hearing was set for May 24, 2018. At the May 24,

2018 hearing, counsel for Yata appeared and requested a

1 The Honorable Randal G.B. Valenciano presided.

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continuance to file an opposition, which was granted. Despite

the continuance, no opposition (or any form of objection) in

response to the Motion for Summary Judgment was filed. Neither

Yata nor his counsel appeared at the continued hearing on the

Motion for Summary Judgment, which was held on June 26, 2018.

Accordingly, to the extent that Yata contends – based on hearsay

objections that were not raised in response to the Motion for

Summary Judgment – that the Circuit Court erred in entering the

Foreclosure Decree and Judgment, Yata's arguments are without

merit. See generally Price v. AIG Haw. Ins. Co., Inc., 107

Hawai#i 106, 111, 111 P.3d 1, 6 (2005) (failure to raise

evidentiary objections to affidavits and exhibits in support of

summary judgment can result in waiver of such objections).

The Circuit Court considered the issue of standing –

i.e., whether Deutsche Bank established that it had possession of

the subject note (Note) at the time of the filing of the

complaint – in conjunction with [Yata's] Motion for Rehearing

and/or Reconsideration of this Court's Decision Granting

[Deutsche Bank's] Motion for Summary Judgment as Against All

Defendants and for Interlocutory Decree of Foreclosure (Motion

for Reconsideration) (quotation marks omitted) filed on July 3,

2018.

Yata challenges the Circuit Court's Order Denying

Reconsideration, arguing that Deutsche Bank offered no admissible

evidence that it possessed the Note at the time it filed the

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complaint herein, as required under Bank of Am. v. Reyes-Toledo,

139 Hawai#i 361, 390 P.3d 1248 (2017), and the Hawai#i Supreme

Court cases that followed Reyes-Toledo.

As discussed in U.S. Bank Tr., N.A. v. Verhagen, 149

Hawai#i 315, 325, 489 P.3d 419, 429 (2021), the "[t]estimony of a

witness with personal knowledge of a document may establish the

foundation necessary" to satisfy the authentication requirements

of Hawaii Rules of Evidence (HRE) Rule 901. In Verhagen, the

supreme court further explained: [R]ecords received from another business and incorporated into the receiving business' records may in some circumstances be regarded as created by the receiving business. [Thus,] when a record is treated as created by the receiving business, a person is qualified to authenticate it if the person has enough familiarity with the record-keeping system of the business that created the record, i.e., the receiving or incorporating business. Accordingly, a person may be qualified to authenticate an incorporated record even if the person lacks familiarity with the records or record-keeping practices of the entity that actually created the record.

Id. at 325, 489 P.3d at 429 (cleaned up).

The supreme court pointed to the importance of

considering whether records created by the other business were

incorporated into the loan servicer's own records and were not

merely in the servicer's custody, in particular where there is

testimony from the servicer's custodian or witness qualified to

testify about its records that: the servicer incorporated and

kept the documents in the normal course of business; the servicer

typically relies upon the accuracy of the contents of the

documents; and the circumstances otherwise indicate the

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trustworthiness of the documents. Id. at 326, 489 P.3d at 430

(citation omitted).

Here, with the Motion for Summary Judgment, Deutsche

Bank submitted, inter alia, a declaration of Matthew Mountes

(Mountes), Second Assistant Vice President of Specialized Loan

Servicing LLC (SLS), loan servicer for Deutsche Bank; and in

conjunction with its response to the Motion for Reconsideration,

Deutsche Bank submitted, inter alia, a declaration of Mark

McCloskey (McCloskey), Assistant Vice President of SLS, both

attesting to their personal review and knowledge of SLS's

records, including incorporated records. With careful

consideration of the supreme court's directives in Verhagen, and

upon review of the evidence presented by Deutsche Bank, we

conclude that Mountes and McCloskey were qualified witnesses with

personal knowledge of SLS's procedures for creating its records,

including its procedures for incorporation of records of other

businesses into SLS's records, and SLS's reliance on those

records and maintenance of those records in the course of its

regularly-conducted business activities, after a pre-

incorporation process of quality control and verification

procedures. Although indicia of trustworthiness are not profuse,

we conclude that the record provides sufficient indicia of

trustworthiness, including with respect to the evidence that the

Note was in the possession of Deutsche Bank, through its

custodian Deutsche Bank National Trust Company, at the time the

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foreclosure complaint was filed. Thus, we conclude that the

Circuit Court did not err or abuse its discretion in denying the

Motion for Reconsideration and rejecting Yata's argument that

Deutsche Bank did not have standing to foreclose on the subject

property.

For these reasons, the Circuit Court's November 1, 2018

Order Denying Reconsideration and its July 19, 2018 Foreclosure

Decree and Judgment are affirmed.

DATED: Honolulu, Hawai#i, June 9, 2022.

On the briefs: /s/ Lisa M. Ginoza Gary Victor Dubin, Chief Judge Frederick J. Arensmeyer, for Defendant-Appellant. /s/ Katherine G. Leonard Associate Judge Marvin S.C. Dang, Amy Jackson, /s/ Clyde J. Wadsworth for Plaintiff-Appellee. Associate Judge