WH Shipman, Ltd. v. Hawaiian Holiday

802 P.2d 1203
CourtHawaii Intermediate Court of Appeals
DecidedDecember 13, 1990
Docket13758
StatusPublished

This text of 802 P.2d 1203 (WH Shipman, Ltd. v. Hawaiian Holiday) is published on Counsel Stack Legal Research, covering Hawaii Intermediate Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
WH Shipman, Ltd. v. Hawaiian Holiday, 802 P.2d 1203 (hawapp 1990).

Opinion

802 P.2d 1203 (1990)

W.H. SHIPMAN, LIMITED, Plaintiff-Appellee,
v.
HAWAIIAN HOLIDAY MACADAMIA NUT CO., INC., Defendant-Appellant.

No. 13758.

Intermediate Court of Appeals of Hawaii.

June 14, 1990.
Certiorari Granted June 28, 1990.
Certiorari Dismissed December 13, 1990.

*1204 John W. Goemans and Dennis W. Potts on the briefs, Honolulu, for defendant-appellant and for DeDomenico Orchards, Inc., General Partner of Keaau Agriculture, respectively.

Wayne Nasser and Adrian W. Rosehill, Honolulu (Ashford & Wriston, of counsel), on the brief for plaintiff-appellee.

Before BURNS, C.J., and HEEN and TANAKA, JJ.

TANAKA, Judge.

Defendant Hawaiian Holiday Macadamia Nut Co., Inc. (Hawaiian Holiday) appeals the summary judgment in favor of plaintiff W.H. Shipman, Limited (Shipman). Hawaiian Holiday contends that the lower court abused its discretion in imposing on it extreme discovery sanctions, thereby precluding *1205 it from resisting Shipman's motion for summary judgment. We agree and vacate the judgment.

DeDomenico Orchards, Inc. (DeDomenico Orchards), a general partner of Keaau Agriculture, appeals the lower court's denial of its Hawaii Rules of Civil Procedure (HRCP) Rule 19(a) motion to join Keaau Agriculture in the case as a "party in interest." We affirm the denial.

I. FACTS

A. The Participants

Shipman, a Hawaii corporation, is the owner and lessor of 2,717.447 acres of land (Land) at Keaau-Mountain View, in the Puna District, County of Hawaii.

Hawaiian Holiday, a Hawaii corporation, is the lessee of the Land. It is primarily a macadamia nut processor and distributor. Hawaiian Holiday is owned and controlled by Paul DeDomenico.

DeDomenico Orchards was incorporated to cultivate and manage macadamia nut orchards. DeDomenico Orchards is owned and controlled by Paul DeDomenico.

Keaau Agriculture is a limited partnership consisting of DeDomenico Orchards and Pacific Agriculture, the general partners, and several limited partners, most of whom are individuals residing in Texas.

B. The Lease and Its Alleged Breach

On October 4, 1984, Shipman and Hawaiian Holiday entered into a lease of the Land (Lease). The term of the Lease was approximately 55 years, commencing November 15, 1984, and ending December 31, 2039. The Lease provided for minimum rent of $70 per plantable acre per annum for the first five years. For the purpose of calculating the rent, the Lease provided that 2,593 acres of the Land were plantable to macadamia nut trees. The minimum rent increased for the next two five-year periods. The percentage rent was based on the "gross proceeds" from the sale of macadamia nuts and products and other crops.

Commencing in 1985, differences arose between Hawaiian Holiday and Shipman regarding the plantable acreage of the Land. The differences culminated in Shipman's March 4, 1988 letter informing Hawaiian Holiday of its default under the Lease and the cancellation of the Lease effective March 31, 1988.

C. The Lawsuit

On April 12, 1988, Shipman filed a tencount complaint against Hawaiian Holiday, alleging breaches of the Lease in several particulars, including failure to pay lease rent and real property taxes. Shipman sought possession of the Land and recovery of the unpaid rent, other charges, and damages.

On May 19, 1988, Hawaiian Holiday answered the complaint and counterclaimed. The counterclaim alleged that the provision that 2,593 acres of the Land was plantable was a mutual mistake and sought reformation of the Lease to reflect the actual plantable acreage.[1]

On July 18, 1988, Shipman served Hawaiian Holiday with a first request for production of documents and a request for answers to first set of interrogatories (Interrogatories). On July 25, 1988, Shipman served Hawaiian Holiday with its first request for admissions and second request for admissions. Shipman's counsel granted Hawaiian Holiday extensions of time to respond to the discovery requests to September 8, 1988. In response to Shipman's first request for production of documents, Hawaiian Holiday served Shipman with the requested documents on September 9, 1988.

On September 26, 1988, Shipman noticed the taking of depositions of Paul DeDomenico and Rod Saunders, Chief Executive Officer and Vice President, respectively, of Hawaiian Holiday. Their depositions were taken on October 19, 1988.

Also on September 26, 1988, Shipman filed a motion to compel discovery (Motion to Compel), seeking sanctions against Hawaiian *1206 Holiday for discovery violations. Hawaiian Holiday did not file any response in opposition to the motion and failed to appear at the hearing on October 25, 1988. The court orally granted Shipman's motion.

On October 28, 1988, Hawaiian Holiday served Shipman with (1) answers to the Interrogatories, (2) answers to first request for admissions, and (3) answers to second request for admissions.

On November 2, 1988, the lower court set a jury-waived trial for the case commencing February 13, 1989.

On November 14, 1988, the lower court entered its order granting Shipman's Motion to Compel (November 14, 1988 Order). The November 14, 1988 Order provided that (1) Hawaiian Holiday was "precluded from asserting, or offering evidence of, any matters covered by the [Interrogatories] ... in defense of any claims [in the case]," (2) all matters covered in the first and second requests for admissions were "deemed admitted in their entirety," and (3) Shipman be awarded its expenses of the motion, including reasonable attorneys' fees. Record, Vol. 1 at 204.

Hawaiian Holiday responded with its November 25, 1988 "Motion to Amend Order Granting [Shipman's] Motion to Compel Discovery" (Motion to Amend), which, in essence, sought a reconsideration of the November 14, 1988 Order. In an affidavit attached to the Motion to Amend, Hawaiian Holiday's attorney stated that (1) the answers to the Interrogatories were completed on September 27, 1988, and delivered to the office of Hawaiian Holiday's chief executive officer for execution, with instruction that the executed answers be sent to Shipman; (2) he assumed that the answers had been executed and mailed to Shipman, "making unnecessary any hearing on the [September 26, 1988 Motion to Compel]"; (3) he later learned that the answers had not been executed since they were misplaced in Hawaiian Holiday's office; and (4) the answers were located on October 25, 1988, and executed on that date. Record, Vol. 1 at 224. The court denied the Motion to Amend on December 16, 1988.

On December 27, 1988, Shipman filed a motion for summary judgment. On January 11, 1989, the day before the scheduled hearing on Shipman's summary judgment motion, DeDomenico Orchards filed a "Motion for Joinder of Keaau Agriculture as a Party in Interest" (Joinder Motion) and a motion to stay all proceedings pending the determination of the Joinder Motion.

On January 12, 1989, the lower court heard and orally granted Shipman's motion for summary judgment. On January 18, 1989, the court heard and orally denied DeDomenico Orchards' Joinder Motion and motion for stay. Written orders regarding these motions and a judgment were filed on March 9, 1989. The judgment terminated the Lease effective April 8, 1988, held that Shipman was entitled to immediate possession of the Land, and awarded Shipman damages, costs, and fees.

Both Hawaiian Holiday and DeDomenico Orchards timely appealed.

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