Ruppersberger v. Ramos

Filing 99

ORDER DENYING RECEIVER'S MOTION FOR WRIT OF POSSESSION AND EJECTMENT re: 64 . Excerpt of conclusion:"The Court grants Plaintiff leave to file an Amended Complaint to foreclose his Mor tgage on the Property.3 Plaintiff must file his Amended Complaint within thirty days of the entry of this Order."IT IS SO ORDERED. Signed by JUDGE ALAN C. KAY on 12/4/2018 . ___________________________3"Since Plaintiff has been granted leave to amend his complaint in order to foreclose his Mortgage, it appears that there is no need at this time for Mr. Haeukulani to serve as Receiver. Accordingly, Mr. Haeukulani is dismissed from this action." (afc) WRITTEN ORDER follows hearing held 12/3/2018. Minutes of hearing: ECF 98 . Charles M. Heaukulani terminated.

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAI`I
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JOHN SIDNEY RUPPERSBERGER,
Plaintiff,
vs.
ROSARIO MAE RAMOS,
Defendant.

ORDER DENYING RECEIVER’S MOTION FOR WRIT OF POSSESSION AND
EJECTMENT
For the reasons set forth below, the Court DENIES the
Receiver’s Motion for Writ of Possession and Ejectment.

In view

of this ruling, the Court also dismisses Receiver Heaukulani.
BACKGROUND
On March 8, 2011, Plaintiff John Sidney Ruppersberger
(“Plaintiff” or “Ruppersberger”) filed a Complaint in this Court
to collect on two promissory notes executed by Defendant Rosario
Mae Ramos (“Defendant” or “Ramos”) in favor of Plaintiff in the
principal amount of $80,000.

Complaint ¶¶ 9, 14, ECF No. 1.

On November 4, 2011, the Magistrate Judge held a
settlement conference on the record and a settlement was
reached.

ECF No. 28.

After the parties filed the Stipulation

for Dismissal, the Court approved it on January 3, 2012.

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ECF

No. 35.

The stipulation provided, in pertinent part, as

follows:
1.

The parties hereby agree that the
above-captioned action is dismissed and
discontinued with prejudice, as to the
named defendant, pursuant to Rule 41(a)
of the Federal Rules of Civil
Procedure.

2.

Any and all claims of damages by
plaintiff which are the subject of this
action or otherwise arise out of any
incidents alleged in the Complaint are
hereby settled, as against the named
defendant, by the terms of the $118,000
mortgage, promissory note and limited
power of attorney (collectively
hereinafter the “Settlement Documents”)
in full satisfaction of all claims for
damages, costs, disbursement and legal
fees.
. . . .

4.

In consideration for the execution of
the Settlement Documents stated in
Paragraph #2, above, plaintiff hereby
releases the named defendant and her
heirs, executors, administrators and
assigns, from any and all claims,
liabilities and causes of action
related to or arising out of any and
all of the events set forth in the
Complaint in the above-captioned
action.
. . . .

6.

This Stipulation of Dismissal and any
Order entered thereon shall have no
precedential value or effect whatsoever
and shall not be admissible in any
other action or proceeding as evidence
or for any other purpose except in an

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action or proceeding to enforce this
Stipulation of Dismissal.
ECF No. 35 at 1-2.
On February 13, 2015, Plaintiff filed a Motion to
Enforce Settlement Agreement.

ECF No. 36.

At an initial

hearing on the Motion, the Magistrate Judge raised a question as
to whether the Court had jurisdiction to enforce the settlement.
See ECF No. 45 at 2.

Plaintiff’s Counsel filed a Supplemental

Memorandum addressing this issue.

Id. at 3-7.

On July 7, 2015, after holding a hearing, Magistrate
Judge Barry M. Kurren issued Findings and Recommendation to
Grant Plaintiff’s Motion to Enforce Settlement Agreement
(“F&R”).

ECF No. 51.

The F&R found that the Court had

“jurisdiction to enforce the settlement agreement, as the
Stipulation for Dismissal incorporated the material terms of the
settlement, thus granting this Court ancillary jurisdiction to
enforce the settlement.”

Id. Conclusions of Law (“COL”) ¶ 2.

Additionally, the F&R noted the Court had jurisdiction because
the Court had diversity jurisdiction.

Id.

The F&R also noted that as part of the Settlement
Agreement, Defendant executed a new $118,000 Promissory Note and
Mortgage in favor of Plaintiff.
6(a).

Id.

Findings of Fact (“FOF”) ¶

The Promissory Note and Mortgage were secured by rental

real property referred to as the “Kaloli House” or the

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“Property,” located at 15-1414 18th Avenue, Puna, Hawai`i, Tax
Map Key No. (3) 1-5-044-114.

Id.

The Promissory Note provided

for a quick payment upon the sale of the Kaloli House, which was
contemplated to occur by June 30, 2012.

Id.

FOF ¶ 6(b).

If

the Kaloli House was not sold by June 30, 2012, the parties
agreed that Plaintiff would be authorized to market and sell it.
Id.

FOF ¶ 6(c).

Specifically, Defendant agreed that she would

cause the tenants to vacate the premises, and Plaintiff would be
authorized to market the Property for sale and move into the
Kaloli House and pay Defendant rent.

Id.

To enable Plaintiff

to market the Property, Defendant executed a Limited Power of
Attorney authorizing Plaintiff to market it.

Id. FOF ¶ 6(d).

If the sale proceeds were insufficient to satisfy the amounts
due under the Promissory Note and Mortgage, the deficiency would
be rolled over into a new Promissory Note and Mortgage on
another real property owned by Defendant.

Id. ¶ 6(e).

The F&R concluded that Defendant breached the
Settlement Agreement by, inter alia, failing to pay the
Promissory Note and not attempting to sell the Kaloli House, as
agreed to by the parties.

Id. FOF ¶ 8.

Defendant also failed

to evict the tenants, as the parties agreed, and interfered with
Plaintiff’s attempts to market and sell the Kaloli House.

Id.

Specifically, Plaintiff removed “For Sale” signs, unsuccessfully
sought a restraining order against Plaintiff, and purportedly
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revoked the Limited Power of Attorney.

Id.

The Magistrate

Judge recommended that the Court appoint a Receiver to market
and sell the Kaloli House.

Id. at 8.

The F&R also recommended

that the Court retain jurisdiction to supervise and assist the
Receiver to perform his duties.

Id.

No objections to the F&R

were filed and on July 27, 2015, the Court entered its Order
Adopting the F&R.

ECF No. 53.

On September 4, 2015, the Court entered an Order
appointing a Receiver.

ECF No. 54.

On May 3, 2016, the

Magistrate Judge entered an Order Granting Plaintiff’s Motion to
Substitute Receiver.

ECF No. 63.

In the Order, the Magistrate

Judge appointed Charles M. Heaukulani as Receiver to market and
sell the Kaloli House.

Id. at 3.

The Receiver was authorized

to: (1) take immediate possession and control of the Kaloli
House; (2) collect rents from any tenants or occupants of the
house; (3) if necessary, seek to evict or eject any tenants or
occupants; and (4) if necessary, seek court authority to proceed
by way of auction in the event the Property could not be sold by
a private sale within a reasonable time period.

Id.

The Order

enjoined Defendant from interfering with the Receiver’s efforts
to market and sell the Kaloli House and from attempting to
regain possession and control of the Kaloli House during the
pendency of the action.

Id. at 3-4.

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The Court also retained

jurisdiction to supervise and assist the Receiver in performing
his duties.

Id. at 4.

On December 27, 2016, the Receiver filed a Motion for
Writ of Possession and Ejectment (“Motion”).

ECF No. 64.

The

Motion requests that the Court issue a writ of possession and
ejectment for the Kaloli House.

Id. at 1.

The Receiver states

that neither the Defendant nor the present occupants of the
Kaloli House have been cooperative in his efforts to market and
sell the Property.

Id. at 2.

He has not been able to obtain a

copy of the lease for the tenant currently residing in the
Property, and he has reached out to Defendant on numerous
occasions and has received a limited or no response.

Id. at 2.

The Receiver believes that the present occupants of the Property
are Zachere C. Andrade and others.

Id. 1

The Receiver states that access to the Kaloli House is
necessary to schedule inspections and address deferred
maintenance.

He also wishes to determine whether several issues

related to the condition of the Property—including termite
evidence in the downstairs bathroom, an inoperable hot water
heater, and a water leak and related wood rot in the kitchen and
1

Plaintiff filed his Motion to Enforce the Settlement Agreement
against, inter alia, JOHN DOE 1-50 and JANE DOE 1-50 defendants
who are persons whose names and identities are presently unknown
to Plaintiff and who are located on the Kaloli House without
Plaintiff’s or the Receiver’s authorization or permission. ECF
No. 34. The Receiver’s Motion similarly includes these
Defendants. ECF No. 64.
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pantry dining areas—are worth repairing before marketing the
Property for sale.

Id.

Defendant filed a Memorandum in

Opposition to the Motion on January 9, 2017.
April 3, 2017, Plaintiff filed his Reply.

ECF No. 68. 2

On

ECF No. 83.

Concurrently with her Opposition, Defendant also filed
a Rule 60(b) Motion to Set Aside the Order Adopting the
Magistrate Judge’s Findings and Recommendation, arguing that the
Court’s decision that it retained jurisdiction over the
Settlement Agreement was void.

ECF No. 67.

On March 24, 2017,

the Court denied Defendant’s Rule 60(b) Motion, finding the
Court had jurisdiction to enforce the Settlement Agreement under
diversity jurisdiction.

ECF No. 81.

On the same day, the Court

set a hearing on the Motion for Writ of Possession and Ejectment
for April 17, 2017.
On April 12, 2017, Defendant appealed Court’s Order
Denying Defendant’s Motion to Set Aside Order Adopting
Magistrate Judge’s Findings and Recommendation.

On January 16,

2018, the Court of Appeals for the Ninth Circuit entered an
order dismissing the case due to Defendant’s failure to file an
opening brief.

On February 5, 2018, Defendant filed a Motion to

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The Court initially scheduled a hearing on the Motion for Writ
of Possession and Ejectment. However, given the issues raised
in the Rule 60(b) Motion, the Court vacated the hearing date,
finding it necessary to consider the Rule 60(b) Motion prior to
considering the Motion for Writ of Possession and Ejectment.
ECF No. 69.
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Reinstate the Case, which the court denied on March 26, 2018.
On April 17, 2018, Defendant filed another Motion to Reinstate
the Case, along with an Opening Brief.

On June 20, 2018, the

court denied Defendant’s second Motion to Reinstate the Case.
On August 13, 2018, Plaintiff requested that this
Court place the Motion for Writ of Possession and Ejectment back
on its calendar.

The Court held a hearing on the Motion for

Writ of Possession and Ejectment on December 3, 2018.
DISCUSSION
The All Writs Act, 28 U.S.C. § 1651(a), permits “all
courts established by Act of Congress” to “issue all writs
necessary or appropriate in aid of their respective
jurisdictions and agreeable to the usages and principles of
law.”

See In re Lakusta, No. C 06-6105, 2007 WL 2255230, at *3

(N.D. Cal. Aug. 3, 2007); see also Hamilton v. Nakai, 453 F.2d
152, 157 (9th Cir. 1971) (stating that “powers under § 1651(a)
should be broadly construed”).

In the absence of a governing

federal statute, federal courts must apply state law remedies
when the case involves the seizure of property.

See Ford Motor

Credit Co. v. Sebastopol Ford, Inc., No. C-07-cv-1783 JSW (EMC),
2007 WL 1189749, at *1-2 (N.D. Cal. Apr. 19, 2007) (applying
California law governing writ of possession of personal
property).

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It is well settled that courts have inherent authority
to enforce agreements that settle litigation before it.

See

Bouwman v. RBC Mortg. Co., 336 F. App’x 621, 622 (9th Cir. 2009)
(affirming order compelling specific performance on the parties’
settlement agreement); Callie v. Near, 829 F.2d 888, 890 (9th
Cir. 1987) (“It is well settled that a district court has the
equitable power to enforce summarily an agreement to settle a
case pending before it.”).
Under Hawai`i law, the Court must construe a
settlement agreement under ordinary contract principles.

See

State Farm Fire & Cas. Co. v. Pacific Rent-All, Inc., 90 Haw.
315, 323-24, 978 P.2d 753, 761-62 (1999).

When the terms of a

contract are definite and unambiguous there is no room for
interpretation.
1, 20 (2006).

Wong v. Cayetano, 111 Haw. 462, 481, 143 P.3d
Furthermore, under Hawai`i law, it is well

established that in contracts for the sale of real property,
“specific performance of contract is a matter of right and
equity will enforce it, absent circumstances of oppression and
fraud.”

Kalinoski v. Yeh, 9 Haw. App. 473, 481, 847 P.2d 673,

678 (1993).
Under the plain terms of the Settlement Agreement, the
$118,000 Promissory Note and Mortgage were secured by the Kaloli
House.

The Promissory Note provided for a payment upon the sale

of the Kaloli House, which Defendant agreed to sell by June 30,
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2012.

If the Kaloli House was not sold by that date, the

parties agreed that Plaintiff would be authorized to market and
sell it.

Defendant also agreed that she would cause the tenants

to vacate the premises.

To enable Plaintiff to market the

Property, Defendant executed a Limited Power of Attorney
authorizing Plaintiff to market it.

As set forth in the

Magistrate Judge’s F&R, Defendant did not fulfill her
obligations under the Settlement Agreement.

She did not pay the

Promissory Note, attempt to sell the house, or cause the tenants
to vacate the premises.

In fact, Defendant thwarted Plaintiff’s

attempts to market the Property or to allow Plaintiff to move
into the Property by removing “For Sale” signs, unsuccessfully
seeking a restraining order against Plaintiff, and purportedly
revoking the Limited Power of Attorney.

Since the Court’s Order

Adopting the Magistrate Judge’s F&R, Defendant continues to be
uncooperative.
To enforce the terms of the Settlement Agreement
through specific performance, the Court appointed a Receiver to
market and sell the Property.

The Court authorized the Receiver

to, inter alia, take possession and control of the Kaloli House
and if necessary to seek to evict or eject any tenants of the
Kaloli House.

The Court also retained jurisdiction to assist

the Receiver in the performance of his duties.

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Because

Defendant and her tenants have failed to cooperate, the Receiver
has been unable to enforce the Settlement Agreement.
Notwithstanding the Court’s reservation of
jurisdiction to assist the Receiver in enforcing the settlement
agreement, along with Defendant’s brazen lack of cooperation,
the Court finds that granting the Receiver’s Writ of Possession
and Ejectment is not appropriate given the facts of the instant
case.
Defendant argues that Plaintiff does not have title to
the Property and therefore cannot obtain a writ of possession
and ejectment.

Under Hawai`i law, to maintain a possession and

ejectment action, the plaintiff must prove that he owns the
parcel in issue, meaning that he or she must have “‘the title to
and right of possession of’” such parcel.

Kondaur Capital Corp.

v. Matsuyoshi, 136 Haw. 227, 241, 361 P.3d 454, 468 (2015)
(quoting Carter v. Kaikainahaole, 14 Haw. 515, 516 (Haw. Terr.
1902) (holding that an action of ejectment is the remedy at law
for a “complainant who has the title to and right of possession
of certain land”)).

Additionally, the plaintiff must establish

that “‘possession is unlawfully withheld by another.’”

Id.

Although Plaintiff has the right of possession and
Defendant has unlawfully withheld possession of the Property,
neither Plaintiff nor the Receiver has ownership of or title to
the Property.

Plaintiff, in his Reply, argues that the
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appointment of a Receiver divested Defendant of possession,
management and control of the property.

Reply at 3.

Although

the Receiver has the right of possession and Defendant has
wrongfully withheld possession, no order of this Court has
divested Defendant of title to the Property.

Accordingly, the

Court finds that the Receiver has not met the title element that
is required in order for this Court to grant the Receiver’s
Motion for Writ of Possession and Ejectment.
In addition, it is well-settled that under Hawai`i
law, courts have the power to specifically enforce valid
contracts for the sale of real property.

See, e.g., Kalinowski,

9 Haw. App. at 481-82, 847 P.2d at 678-79 (holding that specific
performance is available to a purchaser of a specific
condominium unit where the seller breaches the sale agreement);
Scotella v. Osgood, 4 Haw. App. 20, 25, 659 P.2d 73, 76-77
(1983) (finding that specific performance of a contract for the
purchase of land may be decreed even where the buyer seeking
enforcement has breached the contract); Hurst v. Kukahi, 25 Haw.
194, 195 (Haw. Terr. 1919) (holding that specific performance of
a contract for the sale of land is appropriate absent a showing
of unfairness, injustice, inequality, or grossly inadequate
consideration).
The Court is unaware, however, of any Hawai`i cases
involving specific performance of a settlement agreement
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concerning real property similar to the one at issue before the
Court.

Here, the Settlement Agreement required Defendant to

sell the Property in order to pay a promissory
51 FOF ¶ 6(b).

note.

ECF No.

When Defendant failed to sell the Property by

June 30, 2012, the Settlement Agreement granted Plaintiff the
right to market and sell the Property in order to pay the
Promissory Note.

Id. FOF ¶ 6(c).

However, Plaintiff and

Defendant are not parties to an agreement for the sale of land,
where one party is seeking specific enforcement against the
other—they are parties to an agreement that authorizes Plaintiff
to sell Defendant’s real property in order to satisfy a debt.
Therefore, the facts of this case are distinguishable from those
Hawai`i cases where courts have decreed specific performance of
contracts for the sale of real property.

See

Kalinowski, 9

Haw. App. at 481-82, 847 P.2d at 678-79; Scotella, 4 Haw. App.
at 25, 659 P.2d at 76-77; Hurst, 25 Haw. at 195.

For the

foregoing reasons, the Court finds that specific performance is
inappropriate in this case.
However, the Court notes that Plaintiff holds a
Mortgage on the Property in amount of $118,000.00 which
Defendant executed as part of the Settlement Agreement.
No. 36-6.

See ECF

After a mortgagee brings a foreclosure action and

establishes title to a property, a court may issue a writ of

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possession and ejectment in order to remove the mortgagor from
the property.

Carter, 14 Haw. at 516.

Plaintiff’s Mortgage on the Property secures the
Promissory Note and its Addendum, which Defendant also executed
pursuant to the Settlement Agreement.

See ECF No. 36-4, 36-5.

The Mortgage sets forth Plaintiff’s remedies, including his
right to foreclose the Mortgage, in the event Defendant fails to
pay the Promissory Note or breaches a covenant contained in the
Mortgage.

The Magistrate Judge found that the Settlement

Agreement was breached for numerous reasons, including that
Defendant did not pay the Promissory Note.

ECF No. 51 FOF ¶ 8.

For the foregoing reasons, and in accordance with the
discussion at the Court’s Hearing held on December 3, 2018,
Plaintiff may proceed with enforcement of the Settlement
Agreement by amending his complaint to foreclose his Mortgage.
CONCLUSION
For the foregoing reasons, the Court DENIES the
Receiver’s Motion for Writ of Possession and Ejectment.

The

Court grants Plaintiff leave to file an Amended Complaint to
foreclose his Mortgage on the Property. 3

Plaintiff must file his

Amended Complaint within thirty days of the entry of this Order.

3

Since Plaintiff has been granted leave to amend his complaint
in order to foreclose his Mortgage, it appears that there is no
need at this time for Mr. Haeukulani to serve as Receiver.
Accordingly, Mr. Haeukulani is dismissed from this action.
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IT IS SO ORDERED.
DATED:

Honolulu, Hawai`i, December 4, 2018.

________________________________
Alan C. Kay
Sr. United States District Judge

Ruppersberger v. Ramos, Civ. No. 11-00145 ACK-KJM, Order Denying Receiver’s
Motion for Writ of Possession and Ejectment.

However, the Court notes at this time that Mr. Haeukulani may be
reappointed as Commissioner during the foreclosure sale.
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