Du Preez v. Banis et al
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION FOR SUMMARY JUDGMENT AND DENYING AS MOOT DEFENDANTS' MOTION TO DISMISS re 137 Motion to Dismiss for Failure to State a Claim re 148 Motion for Summary Judgment. Signed by JUDGE LESLIE E. KOBAYASHI on 09/30/2015. -- On the basis of the foregoing, Defendants' Motion for Summary Judgment, filed June 26, 2015, is HEREBY GRANTED IN PART AND DENly, this Court: 1) GRANTS summary j udgment in favor of Defendants as to Counts II, III, IV, V, and VII; 2) GRANTS summary judgment in favor of Defendants Kent Green and Rachel Bridgewater as to Counts I and VI; and 3) DENIES Defendants' Motion for Summary Judgment as to all other portions of Counts I and VI. There being no remaining claims against Green and Bridgewater, this Court DIRECTS the Clerk's Office to terminate them as parties. (eps)CERTIFICATE OF SERVICEPartici pants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
RONI DU PREEZ,
RICK BANIS, DON CARANO, FRED )
SCARPELLO, JOHN MACKALL, ET
CIVIL NO. 14-00171 LEK-RLP
ORDER GRANTING IN PART AND DENYING IN PART
DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT AND
DENYING AS MOOT DEFENDANTS’ MOTION TO DISMISS
On May 19, 2015, Defendants Rick Banis, Don Carano,
Fred Scarpello, John Mackall, and Representatives/Executors/
Trustees of William Pennington (collectively, “Trustee
Defendants”), Kent Green (“Green”), Racquel Bridgewater
(“Bridgewater”), WNP Enterprises, Inc. (“WNP”), and Western
Equities LLC (“Western,” and all collectively, “Defendants”)
filed their Motion to Dismiss the Third Amended Complaint for
Damages and Equitable Relief (“Motion to Dismiss”), and, on
June 26, 2015, they filed their Motion for Summary Judgment.
[Dkt. nos. 137, 148.]
Plaintiff Roni Du Preez (“Plaintiff”) filed her
memorandum in opposition to the Motion to Dismiss (“Dismissal
Opposition”) on June 1, 2015, and Defendants filed their reply
(“Dismissal Reply”) on July 13, 2015.
[Dkt. nos. 143, 151.]
Plaintiff filed a surreply (“Dismissal Surreply”) on July 23,
[Dkt. no. 152.]
Plaintiff filed her memorandum in opposition to the
Motion for Summary Judgment (“Summary Judgment Opposition”) on
August 19, 2015, and Defendants filed their reply (“Summary
Judgment Reply”) on August 31, 2015.
[Dkt. nos. 163, 176.]
Plaintiff filed a surreply (“Summary Judgment Surreply”) on
September 9, 2015.
[Dkt. no. 192.]
These matters came on for hearing on September 14,
After careful consideration of the motions, supporting
and opposing memoranda, the arguments of counsel, and the
relevant legal authority, Defendants’ Motion for Summary Judgment
is HEREBY GRANTED as to Counts II, III, IV, V, and VII, and as to
the portions of Counts I and VI against Green and Bridgewater.
The Motion for Summary Judgment is HEREBY DENIED as to all other
portions of Counts I and VI.
In light of the Court’s ruling on the Motion for
Summary Judgment, Defendants’ Motion to Dismiss is HEREBY DENIED
The gravamen of this case is that Plaintiff seeks to
enforce the promises that she alleges her former employer,
Plaintiff filed all of her memoranda pro se, but, by the
time of the hearing, she was represented by counsel. See
Appearance of Counsel, filed 9/11/15 (dkt. no. 195).
William Pennington (“Pennington”), made to her before she
accepted the position as the manager of his vacation home in
Wailea, on the Island of Maui (“the Property”) and during the
course of her employment.
The relevant procedural background of
this case is set forth in this Court’s January 30, 2015 order
addressing Defendants’ motion to dismiss a prior version of the
complaint (“1/30/15 Order”).
[Dkt. no. 74.2]
This Court will
therefore only address the events that occurred after the filing
of the 1/30/15 Order.
On March 2, 2015, Plaintiff filed her Second Amended
Complaint for Damages and Equitable Relief (“Second Amended
[Dkt. no. 92.]
On April 27, 2015, the magistrate
judge granted Plaintiff’s motion for leave to file a third
amended complaint, [dkt. no. 125,] and Plaintiff timely filed her
Third Amended Complaint for Damages and Equitable Relief (“Third
Amended Complaint”) on May 5, 2015 [dkt. no. 130].
The Third Amended Complaint alleges the following
claims against all Defendants, except where specified: breach of
implied contract (“Count I”); wrongful termination (“Count II”);
breach of the covenant of good faith and fair dealing
(“Count III”); interference with prospective economic advantage
The 1/30/15 Order is also available at 2015 WL 415890. It
addressed Plaintiff’s First Amended Complaint for Damages and
Equitable Relief (“First Amended Complaint”). [Filed 7/21/14
(dkt. no. 38).]
against Green (“Count IV”); fraudulent misrepresentation
(“Count V”); promissory estoppel (“Count VI”); and breach of oral
contract (“Count VII”).
Plaintiff prays for judgment in her
favor as to all counts and the following relief: compensatory
and/or consequential damages in the amount of $2,500 per month
“for the duration of her life or reasonable date of retirement”;
an award of “lost income and benefits for the remainder of her
work life until reasonable retirement age”; an award of “an
amount equivalent to the pension she would have received upon
retirement”; $250,000 in damages for emotional distress; punitive
or exemplary damages; reasonable attorneys’ fees and costs; and
any other appropriate relief.
[Third Amended Complaint at pgs.
In the Motion to Dismiss, Defendants argue that this
Court should dismiss all of Plaintiff’s claims pursuant to Fed.
R. Civ. P. 12(b)(6) because each one fails to state a claim upon
which relief can be granted.
To the extent that any of
Plaintiff’s claims survive dismissal, Defendants argue that this
Court should dismiss them as to Bridgewater because the Third
Amended Complaint does not allege sufficient facts to support
Plaintiff’s claims against her.
In the Motion for Summary
Judgment, Defendants argue that Plaintiff has not identified any
genuine issue of material fact, and therefore they are entitled
to judgment as a matter of law as to any claim that survives the
Motion to Dismiss.
On September 10, 2015, Defendants filed their Request
for Judicial Notice in Support of Motion for Summary Judgment
[Dkt. no. 194.]
Defendants ask this Court to take
judicial notice of the following:
[R]ather than producing any records or testimony
that might support Plaintiff’s conclusory
assertions [regarding the manager that she hired
for the businesses that she previously ran with
her husband and the opportunity to start a
business in 2008 that she forwent], Plaintiff and
her husband have (1) filed objections and motions
to quash Defendants’ subpoenas [see Dkt. Nos. 177,
178, 179, 180, 181, and 182], and (2) filed a new
complaint against Defendants’ counsel and the
process server in the Circuit Court of the Second
Circuit, State of Hawaii, asserting that
Defendants’ efforts to obtain such discovery
amounts to an abuse of process.
[Request at 2 (emphasis and second set of brackets in original).]
The complaint in the state court case is attached to the Request
as Exhibit 1.
This Court is required to grant the Request if it
addresses facts that are subject to judicial notice and
Defendants provided the “necessary information.”
See Fed. R.
A fact is subject to judicial notice if it “is
not subject to reasonable dispute because it: (1) is generally
known within the trial court’s territorial jurisdiction; or
(2) can be accurately and readily determined from sources whose
accuracy cannot reasonably be questioned.”
Court FINDS that the filing of the documents referenced in the
Request is subject to judicial notice, and it GRANTS the REQUEST
as to the filing of those documents.
This Court, however, FINDS that the documents are not
relevant to the issues currently before it.
contend that Plaintiff should be precluded from presenting
certain evidence at trial because of her failure to provide
requested discovery, Defendants must file the appropriate motion.
Plaintiff has requested leave to file a surreply in
opposition to the Motion to Dismiss.
[Dismissal Surreply at 2.]
Local Rule 7.4 states that, other than the memorandum in
opposition and the reply, “[n]o further or supplemental briefing
shall be submitted without leave of court.”
Insofar as this
Order denies the Motion to Dismiss as moot, this Court also
DENIES AS MOOT Plaintiff’s request for leave to file the
In the Summary Judgment Surreply, Plaintiff argues that
this Court should not consider Defendants’ argument in the
Summary Judgment Reply that: “Any reasonable person would have
understood [the alleged promise] to be intended to suggest, at
most, that Mr. Pennington treats people well, and would be a good
boss for so long as good services were provided.”
Judgment Surreply at ¶ 8 (quoting Summary Judgment Reply at 34).]
Plaintiff contends that Defendants improperly raised this
argument for the first time in the Summary Judgment Reply.
at ¶ 9.]
Local Rule 7.4 states, in pertinent part, “[a]ny
argument raised for the first time in the reply shall be
The argument that Plaintiff cites from the Summary
Judgment Reply is merely an extension of the issues that
Defendants raised in the Motion for Summary Judgment.
Mem. in Supp. of Motion for Summary Judgment at 10 (“the sole
statement on which Plaintiff relies - ‘stick with me and I will
take care of you for life’ - is not sufficiently definite to be
Thus, to the extent that Plaintiff asks this
Court to strike or disregard the argument that she quotes from
the Summary Judgment Reply, Plaintiff’s request is DENIED.
This Court now turns to the merits of Defendants’
Motion for Summary Judgment.
Defendants’ Motion for Summary Judgment
Plaintiff worked as a personal assistant for the prior
owner of the Property, John Cavanaugh (“Cavanaugh”), from
approximately October 2002 until he sold the Property to
Pennington in January 2005.
[Pltf.’s Decl. in Opp. to Defs.’
Motion for Summary Judgment (“Pltf.’s Decl.”), filed 8/19/15
(dkt. no. 166), at ¶¶ 6, 11, 58.3]
When Plaintiff worked for
Cavanaugh, she was self-employed as an independent contractor.
She set her own schedule and had the ability to decline work from
This allowed Plaintiff to divide her time between working
for Cavanaugh and working with her husband on their own
[Id. at ¶¶ 8-9.]
Although Cavanaugh did not require
Plaintiff to work with him exclusively, she relinquished all of
her other clients.
[Id. at ¶¶ 7, 58.]
On or around January 19, 2005, Plaintiff interviewed
with Pennington for the position of property manager for the
[Id. at ¶ 13.]
Also present at the interview were
Robin Langel, Pennington’s live-in caretaker, and Green.
According to Plaintiff, Green took notes during the meeting, but
he has stated during discovery that he has no recollection of
whether or not he took notes, and that he was unable to locate
any notes regarding the interview.
[Id. at ¶¶ 20-21 & n.8
(citing Pltf.’s Decl., Exh. 10 (Def. Kent Green’s Responses and
Objections to Pltf.’s Request for Admissions) at Response to
Request No. 3).]
At the interview, Plaintiff and Pennington discussed,
inter alia, the job responsibilities, required hours, and
Plaintiff submitted twenty one exhibits with her
declaration. Exhibit 19 to Plaintiff’s Declaration, which itself
includes Exhibits A through H, is filed separately from
Plaintiff’s Declaration as dkt. no. 164.
The terms of the position included:
-working exclusively for Pennington;
-working full-time and being on call twenty-four hours a day,
seven days a week, including holidays, when Pennington was
staying at the Property;
-working more than forty hours per week when Pennington was
staying at the residence and reducing her hours accordingly
during weeks when he was not there;
-complying with a schedule set by the Head Housekeeper,
Terri Langel, who Plaintiff would report to, and who would
train Plaintiff and provide her with more detailed
[Id. at ¶¶ 26-26.d.]
After Pennington informed Plaintiff of the job
requirements, he stated that she would be paid $2,500 per month.
Plaintiff did not accept the offer at that time.
asked Plaintiff if she had any questions.
[Id. at ¶¶ 29-31.]
32. I was concerned that the employment
would be short-term, due to Mr. Pennington’s
advanced age and declining health, and discussed
my reservations at the interview.
33. I asked, “How long have your employees
been working for you?” in order to bring up the
issue of job security.
34. Mr. Pennington understood what I was
asking smiled and replied, “A long time”. A short
discussion ensued in which various employees and
their length of employment for Mr. Pennington
and/or his corporations were mentioned.
. . . .
36. Mr. Pennington made it known we would be
entering into a long term employment agreement by
saying “This is for the long term”.
37. Mr. Pennington also told me, during the
negotiations, and prior to an agreement, “I want
good people working for me. With me, you will not
have to worry about your future.”
38. Mr. Pennington then explicitly told me,
“Stick with me and I will take care of you for
[Id. at pgs. 11-12 (emphasis added).]
After Pennington made that
statement, Plaintiff verbally accepted the position, and shook
hands with Pennington, Langel, and Green.
[Id. at ¶ 41.]
Plaintiff believed the statement to be a promise of “compensation
for life,” and she would not have accepted the position without
that promise, which was “an integral part of the contract.”
at ¶¶ 47, 49.]
She states that the $2,500 monthly salary, “was
less money than [she] was earning at the time, was without
benefits, and was without agreeing to any raises or cost of
living increases, which [she] had received while working for
[Id. at ¶ 49.]
Plaintiff states that Pennington
hired another former Cavanaugh employee in January 2005 to work
at the Property and perform similar duties to Plaintiff.
person was paid $6,000 per month.
[Id. at pg. 15 n.12 (citing
Pltf.’s Decl., Exh. 13 at WNP00362-64 (check records from Western
Equities, LLC to Cathy Hetzel for $3,000.00 for “Contract Labor”
for three bi-monthly periods in 2005)).]
Plaintiff believed Pennington’s statement and that he
had the financial ability to honor it.
From her prior employment
with Cavanaugh, Plaintiff knew that Pennington purchased the
Property for $9.2 million in cash and that Pennington “agreed to
purchase the furniture and cars that were in the [Property] via
[Id. at ¶¶ 44-46 & n.11 (citing Pltf.’s Decl.,
Exh. 12 (fax dated 1/7/05 to “Racquel Bridgewater” from Cathy A.
Hetzel for John E. Cavanaugh)).]
According to Plaintiff, during her employment,
Pennington reaffirmed his promise of lifetime compensation:
56. Mr. Pennington also told me, when him,
myself and Mr. Langel were discussing an employee
that had been fired, “don’t do anything to get
fired and I will take care of you for life.”
57. When I expressed fear that I would lose
him and my job, I was told, “That’s not going to
happen. Don’t worry you are taken care of.”
[Id. at pg. 17.]
Plaintiff was employed at the Property for over seven
[Defs.’ Concise Statement of Facts in Supp. of Motion for
Summary Judgment (“Defs.’ CSOF”), filed 6/26/15 (dkt. no. 149),
at ¶ 25; Pltf.’s Separate Concise Statement of Facts in Opp. to
Motion for Summary Judgment (“Pltf.’s CSOF”), filed 8/19/15 (dkt.
no. 165), at ¶ 25 (stating that Defendants’ paragraph 25 is
During that time, Plaintiff “did not receive a
raise, or any benefits, as [she] had been promised lifetime
In addition to the exhibits attached to Plaintiff’s
Declaration and the Summary Judgment Opposition, there are eleven
exhibits attached to Plaintiff’s CSOF.
[Pltf.’s Decl. at ¶ 53.]
employment, Plaintiff was paid with checks from either Western or
WNP Enterprises Inc.
[Id. at ¶ 55 (citing Pltf.’s Decl., Exh. 14
(sample check records)).]
The check records have corresponding
However, Plaintiff states that she never
provided an invoice, as an independent contractor would.
Defs.’ CSOF, Decl. of Andrew J. Lautenbach (“Lautenbach Decl.”),
Exh. A (trans. of videotaped depo. of Plaintiff on 6/4/15
(“Pltf.’s Depo.”)) at 218 (acknowledging that the checks defense
counsel showed her for payments to her in April 2012 state
“Invoice Amount,” but stating that she “never sent an invoice”).]
According to Plaintiff, Defendants had Pennington
declared incompetent around August 2008, and they took control of
Defendants conducted an evaluation of Plaintiff,
which included a background check.
Scarpello’s law firm,
Scarpello & Huss, Ltd., conducted the background check.
Plaintiff cites a letter regarding the background check as
evidence that she was an employee, not an independent contractor.
[Id. at ¶ 68 (citing Pltf.’s Decl., Exh. 20 (letter dated 8/25/08
to Plaintiff from a Scarpello & Huss, Ltd. investigator stating,
“[p]ursuant to your submitting an application for employment or
an application for a background investigation for continued
employment, a Credit Background report was obtained by Scarpello
& Huss, Ltd.”)).]
Pennington died in May 2011.
Pltf.’s CSOF at ¶ 25.]
[Defs.’ CSOF at ¶ 25;
Plaintiff’s employment was terminated
when Western sold the Property in March 2012.
[Pltf.’s Decl. at
¶ 62, Exh. 21 (collection of documents regarding the sale of the
After her termination, Plaintiff sent two letters to
the Trustee Defendants reminding them of the terms of her
employment with Pennington, but they did not respond.
¶¶ 72-73, Exhs. 8-9.]
Plaintiff states she performed all of the
conditions required of her under her contract.
[Pltf.’s Decl. at
Defendants do not concede that Pennington made the
statement: “Stick with me and I will take care of you for life.”
However, in considering a motion for summary judgment, “[a]ll
evidence and inferences must be construed in the light most
favorable to the nonmoving party.”
Maui Elec. Co. v. Chromalloy
Gas Turbine, LLC, Civil No. 12–00486 SOM–BMK, 2015 WL 1442961, at
*4 (D. Hawai`i Mar. 27, 2015) (citing T.W. Elec. Serv., Inc. v.
Pac. Elec. Contractors Ass’n, 809 F.2d 626, 631 (9th Cir. 1987)).
Defendants - and this Court - therefore assume, for purposes of
the Motion for Summary Judgment, that Pennington made that
Defendants argue that, even assuming that Pennington
made the statement, Plaintiff’s claims fail because “each
require[s] Plaintiff to prove an actionable promise” and the
statement “is too indefinite to be enforced under any theory.”
[Mem. in Supp. of Motion for Summary Judgment at 2.]
Plaintiff’s Contract Claims
Counts I, III, VI, and VII are contract-based claims,
and this Court will first address Defendants’ argument that the
statement “Stick with me and I will take care of you for life” is
too indefinite to be enforceable in the context of contract
This district court has stated:
Hawaii law instructs that “[t]o be enforceable, a
contract must be certain and definite as to its
essential terms.” Boteilho v. Boteilho, 58 Haw.
40, 42, 564 P.2d 144 (1977) (citation omitted);
see also Clarkin v. Reimann, 2 Haw. App. 618, 627,
638 P.2d 857 (1981). An “essential term,”
however, is not merely a term that one of the
parties views as “essential” to inducing his or
her assent, . . . but rather a term integral to
the contract itself, such as a price term
specifying the monthly rent or a term indicating
how rent should be calculated in a lease
agreement, as was the case in Clarkin. See
Clarkin, 2 Haw. App. at 628, 638 P.2d 857.
Boskoff v. Yano, 217 F. Supp. 2d 1077, 1088 (D. Hawai`i 2001)
(some alterations in Boskoff).5
Thus, an agreement “‘is not
invalid because certain details are not worked out, where such
details are not essential to the proposal and do not change its
terms or purpose.’”
Constantino v. U.S. Bank, N.A., CV. No. 09-
00066 DAE-RLP, 2011 WL 4435388, at *6 (D. Hawai`i Sept. 23, 2011)
(quoting Assocs. Fin. Servs. Co. of Haw. v. Mijo, 950 P.2d 1219,
This Court has ruled that there was diversity jurisdiction
at the time of removal, and, as a court sitting in diversity, it
applies state substantive law. See 1/30/15 Order, 2015 WL
415890, at *2, 9.
1232 (Haw. 1998)).
Plaintiff has conceded that her belief that Pennington
promised her lifetime compensation was based on the context of
his statement - “Stick with me and I will take care of you for
[Pltf.’s CSOF at ¶ 6 (“Ms. Du Preez understood from the
context of the promise that she would get $2,500.00 a month until
retirement age or death.
This was Mr. Pennington’s intent as
well, as evident from context.”).]
She admits that she
speculated whether she would be paid through a lump sum or an
[Id. at ¶ 5.]
She also admits that no one at her
January 19, 2005 interview used the term “lump sum.”
CSOF at ¶ 9; Pltf.’s CSOF at ¶ 9.]
Although the purported promise of lifetime compensation
in some form was “essential” to Plaintiff in that she would not
have accepted the position without it, it was a “detail[ that
was] not essential to the proposal and [did] not change its terms
See Boskoff, 217 F. Supp. 2d at 1088; Constantino,
2011 WL 4435388, at *6.
The “essential terms” for the formation
of the contract included, for example, the duties of the position
and the monthly salary.
Accord Clarkin, 2 Haw. App. at 628, 638
Thus, the fact that the details of the purported
lifetime compensation were “not worked out” did not preclude the
formation of a contract.
See Constantino, 2011 WL 4435388, at
Count I - Breach of Implied Contract
As to Count I, the issue is whether, having formed a
contract regarding Plaintiff’s services as the manager of the
Property, Plaintiff and Pennington ever worked out the details of
the purported promise of lifetime compensation.
statement - “Stick with me and I will take care of you for life”
- occurred in the context of other statements that he made,
including: “This is for the long term”; and “With me, you will
not have to worry about your future.”
[Pltf.’s Decl. at ¶¶ 37-
Further, during Plaintiff’s employment, Pennington
reiterated, “don’t do anything to get fired and I will take care
of you for life.”
[Id. at ¶ 56.]
He made that statement when
he, Plaintiff, and Robin Langel were having a conversation about
another employee who had been fired.
expressed her fear that she would lose her job when Pennington
died, he told her: “That’s not going to happen.
are taken care of.”
Don’t worry you
[Id. at ¶ 57.]
The Hawai`i Supreme Court has stated:
An implied contract, in the proper sense, is where
the intention of the parties is not expressed, but
an agreement in fact, creating an obligation, is
implied or presumed from their acts, as in the
case where a person performs services for another,
who accepts the same, the services not being
performed under such circumstances as to show that
they were intended to be gratuitous, or where a
person performs services for another on request.
Kemp v. State of Hawai`i Child Support Enf’t Agency, 111 Hawai`i
367, 391, 141 P.3d 1014, 1038 (2006) (citations omitted).
This Court acknowledges that it is a close question
whether Pennington’s and Plaintiff’s actions gave rise to an
implied or presumed obligation that Plaintiff would receive
However, issues of Plaintiff’s
credibility are a critical component of that determination, and
this Court cannot rule on credibility issues on a motion for
See, e.g., Kauhako v. State of Haw. Bd. of
Educ. Dep’t of Educ., Civil No. 13-00567 DKW-BMK, 2015 WL
5312359, at *7 (D. Hawai`i Sept. 9, 2015) (citing Nelson v. City
of Davis, 571 F.3d 924 (9th Cir. 2009) (“[C]redibility
determinations, the weighing of the evidence, and the drawing of
legitimate inferences from the facts are jury functions, not
those of a judge.”) (citations omitted))).
Viewing the record in the light most favorable to
Plaintiff, this Court FINDS that she has responded to Defendants’
Motion for Summary Judgment with sufficient evidence in support
of her implied contract claim.
See Nauman v. Bugado, 374 F.
Supp. 2d 893, 900 (D. Hawai`i 2005) (“Generally, when a plaintiff
fails to respond to a motion for summary judgment with sufficient
evidence to support his or her claims, that plaintiff has failed
to meet its burden of showing the existence of a genuine issue of
material fact, and therefore summary judgment will be granted to
the defendant.” (citing T.W. Elec. Service, 809 F.2d at 630)).
Further, this Court FINDS that there are genuine issues of
material fact regarding whether Plaintiff and Pennington formed
an implied contract that required Pennington to pay her lifetime
This Court CONCLUDES that Defendants are not
entitled to judgment as a matter of law.6
See Fed. R. Civ. P.
56(a) (stating that a party is entitled to summary judgment “if
the movant shows that there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter
This Court therefore DENIES Defendants’ Motion for
Summary Judgment as to Count I.
Count VII - Breach of Oral Contract
Defendants have argued that Counts I and VII are
duplicative and that Plaintiff cannot proceed on both claims.
However, Fed. R. Civ. P. 8(d)(2) allows a plaintiff to plead “2
or more statements of a claim . . . alternatively or
In concluding that Defendants are not entitled to judgment
as a matter of law as to Count I, this Court also rejects their
argument that the claim is barred by the Statute of Frauds, Haw.
Rev. Stat. § 656-1(7). This Court has already addressed the
Statute of Frauds issue in the 1/30/15 Order. 2015 WL 415890, at
*6-7. This Court denied Defendants’ motion to dismiss the breach
of implied contract claim in the First Amended Complaint because
it found that the factual allegations were “sufficient to support
a plausible argument that this Court should grant Plaintiff
relief from the operation of the Statute of Frauds.” Id. at *7.
Based on the same reasoning, this Court now finds that there are
genuine issues of material fact regarding relief from the Statute
of Frauds, and it concludes that Defendants are not entitled to
judgment as a matter of law on the Statute of Frauds issue.
hypothetically, either in a single count or . . . in separate
See also Soule v. Hilton Worldwide, Inc., 1 F. Supp. 3d
1084, 1103 (D. Hawai`i 2014) (stating that “Rule 8(d) allows a
plaintiff to pled [sic] in the alternative”).
“Under Hawai`i law, an oral contract must contain the
following elements in order for it to be enforceable: (1) an
offer, (2) an acceptance, and (3) consideration.”
Ctr. v. Kaiser Found. Health Plan, Inc., 948 F. Supp. 2d 1131,
1144 (D. Hawai`i 2013) (citing Douglass v. Pflueger Hawaii, Inc.,
110 Hawai`i 520, 525, 135 P.3d 129 (2006)).
has presented evidence that she formed an oral contract with
Pennington to employ her as the manager of the Property, she has
not presented any evidence that there was an oral offer and
acceptance regarding the alleged lifetime compensation.
supra Section II.A.1, Plaintiff has conceded that, at the
January 19, 2005 interview, she based her belief that she was
entitled to lifetime compensation on the context of Pennington’s
statements, not on the express promise of such a benefit.
Plaintiff has also conceded that, during her employment, she and
Pennington never had a conversation in which he used the term
“lump sum” in connection with her employment.
[Defs.’ CSOF at
¶ 10; Pltf.’s CSOF at ¶ 10.]
This Court therefore FINDS that Plaintiff has failed to
respond to Defendants’ Motion for Summary Judgment with
sufficient evidence to support her claim for breach of oral
Thus, she has failed to establish a genuine issue of
material fact as to that claim, and Defendants are entitled to
judgment as a matter of law.
See Nauman, 374 F. Supp. 2d at 900.
This Court GRANTS Defendants’ Motion for Summary Judgment as to
Count III - Breach of the Covenant
of Good Faith and Fair Dealing
As this Court noted in the 1/30/15 Order, “[u]nder
Hawai`i law, ‘every contract contains an implied covenant of good
faith and fair dealing that neither party will do anything that
will deprive the other of the benefits of the agreement.’”
WL 415890, at *9 (quoting Best Place, Inc. v. Penn Am. Ins. Co.,
82 Hawai`i 120, 123–24, 920 P.2d 334, 337–38 (1996)).
faith performance ‘emphasizes faithfulness to an agreed common
purpose and consistency with the justified expectations of the
Hawaii Leasing v. Klein, 5 Haw. App. 450, 456,
698 P.2d 309, 313 (1985) (quoting Restatement (Second) of
Contracts § 205 cmt. a (1981)).
This district court, however, has observed that the
Hawai`i courts have never held that a cause of action for breach
of the covenant of good faith and fair dealing exists in every
type of contract and with every type of breach.
court has stated:
Hawai`i courts have not recognized a separate tort
cause of action for bad faith or breach of the
duty of good faith and fair dealing based upon any
type of contract in any circumstances. Moreover,
in Francis v. Lee Enterprises, Inc., 89 Hawai`i
234, 971 P.2d 707, 711–12 (1999), the Hawai`i
Supreme Court stressed the importance that claims
of bad faith be limited to “the insurance context
or situations involving special relationships
characterized by elements of fiduciary
responsibility, public interest, and adhesion.”
The Hawai`i Supreme Court stated that the
limitation on the tort of bad faith was important
due to the fact that recovery in tort was very
different from contractual remedies. Id. at
712–13. Accordingly, the Hawai`i Supreme Court
stated that Hawai`i law will not allow a recovery
in tort “in the absence of conduct that
(1) violates a duty that is independently
recognized by principles of tort law and
(2) transcends the breach of the contract.” Id.
Sung v. Hamilton, 710 F. Supp. 2d 1036, 1050 (D. Hawai`i 2010).
Thus, in the instant case, in order to survive summary
judgment on Count III, Plaintiff must present sufficient evidence
to raise a genuine issue of material fact as to Defendants’
conduct beyond the alleged breach of implied contract.
responding to Defendants’ Motion for Summary Judgment, Plaintiff
cannot rely on the allegations of the Third Amended Complaint,
and she “must set forth specific facts showing that there is a
genuine issue for trial.”
See Porter v. Cal. Dep’t of Corr., 419
F.3d 885, 891 (9th Cir. 2005) (quoting Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 256, 106 S. Ct. 2505, 91 L. Ed. 2d 202
Plaintiff has not presented sufficient evidence of
conduct - beyond the alleged breach of the implied contract 21
that breached the covenant of good faith and fair dealing.
Instead, Plaintiff appears to rely on the same conduct to support
both her breach of implied contract claim and her claim for
breach of the covenant of good faith and fair dealing.
This Court therefore FINDS that Plaintiff has failed to
establish a genuine issue of material fact as to her claim for
breach of the covenant of good faith and fair dealing, and it
CONCLUDES that Defendants are entitled to judgment as a matter of
This Court GRANTS Defendants’ Motion for Summary Judgment
as to Count III.
Count VI - Promissory Estoppel
In the 1/30/15 Order, this Court described the elements
of a promissory estoppel claim under Hawai`i law.
415890, at *12.
For similar reasons as those set forth regarding
Plaintiff’s breach of implied contract claim, see supra Section
II.A.1, this Court FINDS that there are genuine issues of
material fact as to whether there was a promise to provide
Plaintiff with some form of lifetime compensation.
See In re
Herrick, 82 Hawai`i 329, 337-38, 922 P.2d 942, 950-51 (1996)
(setting forth the elements of promissory estoppel).
As to the third element, whether Plaintiff in fact
relied upon the promise, Plaintiff has submitted evidence that:
-she would not have taken the position without the promise of
lifetime compensation because the wages and benefits
associated with the position were below what she had earned
working for Cavanaugh; [Pltf.’s Decl. at ¶¶ 47-49;]
-during her employment at the Property, she forwent any type of
raise or benefits because of the promise of lifetime
compensation; [id. at ¶ 53; Lautenbach Decl., Exh. B
(Pltf.’s Response to Defs.’ First Set of Interrogs.) at
Response to Interrog. No. 6;]
-she forwent working with three businesses that she owned with
her husband at the time she accepted the position, and she
forwent starting a new business in 2008; [Pltf.’s Decl. at
¶¶ 59-60;] and
-she was forced to hire a manager to work with the three
businesses [id. at ¶ 63, Exh. 16 (Aff. of Rudy Becker
(“Becker Aff.”) & list titled “Rudy Payments 2009 and
Plaintiff argues that she and her husband paid Becker more than
Plaintiff received working at the Property.
[Pltf.’s CSOF at
Defendants contest Plaintiff’s assertion that
Pennington required her to work exclusively on the Property.
They point to, inter alia, the fact that, while she was working
there, she also “obtained her real estate license and remained an
officer of several of her husband’s companies.”
[Defs.’ CSOF at
Plaintiff admits these facts, but she asserts that she
never used her real estate license, and that her roles in the
businesses were limited.
[Pltf.’s CSOF at ¶ 30; Pltf.’s Decl. at
¶ 60 & n.16 (stating that she was a part of the businesses “on
paper” and, for example, the extent of her involvement in
Ironwood Ranch during her employment with Pennington “was that in
January 2011 [she] offered Defendant Kent Green and his family,
who were coming to Maui on vacation, free horseback riding
Defendants also argue that Plaintiff’s list of “Rudy
Payments 2009 and 2010” does not establish how much Plaintiff and
her husband paid Becker because it is unclear which line items
are salary related and which are other business expenses.
Becker, however, states that he served as the manager for three
of their businesses for six years, and he received “a monthly
salary plus a percentage share of the profits.”
[Becker Aff. at
He also confirms that Plaintiff “did not participate in the
day to day business or have anything to do with” the three
[Id. at 2.]
Although this Court agrees with
Defendants that the list of 2009 and 2010 payments does not
establish the amount of Becker’s pay, the other materials that
Plaintiff submitted establish that she and her husband hired
Becker because she could not both work with Pennington and work
with the three businesses.
Viewing the record in the light most favorable to
Plaintiff, this Court finds that she has raised a genuine issue
of material fact as to her reliance on the alleged promise of
lifetime compensation, and the issue of whether that reliance was
reasonable involves credibility determinations that this Court
cannot make at the summary judgment stage.
It is a much closer
question whether Plaintiff’s reliance was foreseeable.
“[w]hen evaluating a motion for summary judgment, the court must
‘view the facts and draw reasonable inferences in the light most
favorable to the party opposing the summary judgment motion.’”
United States v. Staton, Civil No. 12-00319 ACK-KSC, 2015 WL
5121944, at *5 (D. Hawai`i Aug. 31, 2015) (emphasis added)
(quoting Scott v. Harris, 550 U.S. 372, 378 (2007)).
standard, this Court finds that Plaintiff has raised a genuine
issue of material fact as to whether her reliance was
Because there are triable issues as to the first
three elements of a promissory estoppel claim, it follows that
there are triable issues as to the fourth element, which is
whether it would be unjust not to enforce the promise.
This Court therefore FINDS that there are genuine
issues of material fact as to Plaintiff’s promissory estoppel
claim, and it CONCLUDES that Defendants are not entitled to
judgment as a matter of law.
Defendants’ Motion for Summary
Judgment is DENIED as to Count VI.
Plaintiff’s Other Claims
Count II - Wrongful Termination
The 1/30/15 Order construed the wrongful termination
claim in the First Amended Complaint as a claim pursuant to
Parnar v. Americana Hotels, Inc., 65 Haw. 370, 652 P.2d 625
2015 WL 415890, at *7-8.
The First Amended Complaint,
however, titled Count II “WRONGFUL TERMINATION - Violation of
Public Policy,” and contained specific allegations about the
“public interest,” “the public good,” and “public policy.”
[First Amended Complaint at pg. 18.]
Plaintiff’s current wrongful termination claim does not
allege a Parnar claim.
Instead, it alleges that Pennington’s
statements “created an atmosphere of job security and fair
treatment” and modified his right to terminate her at-will
[Third Amended Complaint at ¶¶ 40, 43.]
The Hawai`i Supreme Court has
reaffirm[ed] the general principle that, in the
absence of a written employment agreement, a
collective bargaining agreement, or a statutorilyconferred right, employment is at-will. Such atwill employment is, “by definition, . . .
terminable at the will of either party, for any
reason or no reason at all.” Best Place, 82
Hawai`i at 124, 920 P.2d at 357 (1996). As such,
parties to an at-will employment contract enter
into the contract with full knowledge that the
employment is for an indefinite duration and can
terminate at the will of either party. Id.
Correlatively, an employment contract of
indefinite duration will generally be construed as
giving rise to an at-will employment relationship
and as therefore terminable at the will of either
party for any reason or no reason. Parnar, 65
Haw. at 374, 652 P.2d at 627.
Shoppe v. Gucci Am., Inc., 94 Hawai`i 368, 383, 14 P.3d 1049,
1064 (2000) (some alterations in Shoppe) (some citations
However, the Hawai`i Supreme Court also recognized
that “the previously unfettered right of employers to discharge
employees ‘can be contractually modified and, thus, qualified by
statements contained in employee policy manuals or handbooks
issued by employers to their employees.’”
Id. (quoting Kinoshita
v. Canadian Pac. Airlines, 68 Haw. 594, 601, 724 P.2d 110, 115-16
This district court has stated that “Kinoshita does not
. . . require that an employment status can only be altered by an
Rather, the test appears to be whether,
considering all of the circumstances, the employer has ‘created a
situation instinct with an obligation.’”
Leong v. Hilton Hotels
Corp., 689 F. Supp. 1565, 1571 (D. Hawai`i 1988) (some citations
and internal quotation marks omitted) (quoting Kinoshita, 724
P.2d at 117).
Plaintiff’s position is that Pennington’s statements,
including “Stick with me and I will take care of you for life,”
modified her at-will employment such that she could only be
terminated for cause.
Plaintiff does not dispute that her
employment at the Property was terminated after the Property was
sold in March 2012, following Pennington’s death in May 2011.
[Defs.’ CSOF at ¶ 25; Pltf.’s CSOF at ¶ 25.]
In fact, Plaintiff
herself submitted evidence that she was recommended to the
purchasers, but they did not need the services of a property
manager because they planned to spend much more time at the
Property than Pennington did.
An email dated February 24, 2012
to Plaintiff from a “Richard” states, inter alia:
I wanted to let you know that the trustees have
accepted an offer from a buyer for the
residence. . . .
If this deal goes through, it will close by
April 1. Of course you will be paid through
April 1. I talked to Sean and obviously gave you
the highest recommendation possible for the new
buyers (if you were interested). Sean said that
he had already talked to the new buyers about you,
however it appears that they will be spending most
of their time in Maui. Sean wants to talk to you
about other employment possibilities when you
return. Sean asked that you contact him upon your
[Pltf.’s Decl., Exh. 21 at 2.7]
Thus, even assuming, arguendo, that Plaintiff was an
at-will employee, and that Pennington modified her at-will
employment such that she could only be terminated for cause, the
undisputed evidence is that she was in fact terminated for cause
- the sale of the Property.
Plaintiff has pointed to evidence
that her conversations with Pennington and his wife led her to
believe that Mrs. Pennington would inherit the Property upon
Pennington’s death, and that she would continue to work for
[Pltf.’s CSOF at ¶ 13 (some citations omitted)
(citing Pltf.’s Depo. at 107:10-17).]
Plaintiff has presented no
evidence that, under the circumstances, her at-will employment
was modified because of “a situation instinct with an obligation”
that her employment after Pennington’s death would be for any
minimum period of time.
There is no evidence that Plaintiff was
assured that Mrs. Pennington would not sell the Property or that
Plaintiff would somehow be guaranteed employment with anyone who
Plaintiff’s Exhibit 21 consists of multiple documents that
are not consecutively paginated. The citations to Exhibit 21
refer to the page numbers in the district court’s electronic case
purchased the Property after Pennington’s death.
Plaintiff did remain employed at the Property for almost a year
after Pennington’s death.
Thus, even viewing the record in the light most
favorable to Plaintiff, this Court FINDS that there are no
triable issues of fact and CONCLUDES that Defendants are entitled
to judgment as a matter of law as to Plaintiff’s wrongful
This Court GRANTS Defendants’ Motion for
Summary Judgment as to Count II.
Count IV - Interference with
Prospective Economic Advantage
Under Hawai`i law, a plaintiff must establish the
following elements to prove a claim of “intentional interference
with prospective business advantage”:
(1) the existence of a valid business relationship
or a prospective advantage or expectancy
sufficiently definite, specific, and capable of
acceptance in the sense that there is a reasonable
probability of it maturing into a future economic
benefit to the plaintiff; (2) knowledge of the
relationship, advantage, or expectancy by the
defendant; (3) a purposeful intent to interfere
with the relationship, advantage, or expectancy;
(4) legal causation between the act of
interference and the impairment of the
relationship, advantage, or expectancy; and (5)
Minton v. Quintal, 131 Hawai`i 167, 191, 317 P.3d 1, 25 (2013).
This district court has predicted that, “if presented with the
question, the Hawai`i Supreme Court would hold that a breach of
contract, even if done for improper purposes, does not without
more give rise to improper interference for purposes of a
tortious interference with a prospective business advantage
1/30/15 Order, 2015 WL 415890, at *9 (quoting Kapunakea
Partners v. Equilon Enters. LLC, 679 F. Supp. 2d 1203, 1219 (D.
The Third Amended Complaint only alleges Count IV
[Third Amended Complaint at pg. 25.]
Plaintiff has stated that she mislabeled the claim and intended
to also assert Count IV against Bridgewater.
[Dismissal Opp. at
Even assuming, arguendo, that this Court construed Count IV
as stating a claim against Green and Bridgewater, Plaintiff has
failed to raise a triable issue of fact as to either Defendant.
Plaintiff has not presented any evidence which establishes that
either Green or Bridgewater engaged in other conduct beyond his
or her alleged contribution to the breach of the implied
agreement to provide Plaintiff with lifetime compensation.
Thus, even viewing the record in the light most
favorable to Plaintiff, this Court FINDS that there are no
triable issues of fact and CONCLUDES that Defendants are entitled
to judgment as a matter of law as to Plaintiff’s claim for
wrongful interference with prospective economic advantage.
Court GRANTS Defendants’ Motion for Summary Judgment as to
Count V - Fraudulent Misrepresentation
In the 1/30/15 Order, this Court described the elements
of a fraudulent or intentional misrepresentation claim under
2015 WL 415890, at *10.
Plaintiff bases her
fraudulent misrepresentation claim on Pennington’s statements,
primarily the statement: “Stick with me and I will take care of
you for life.”
She argues that “Defendants have failed to deny
that Mr. Pennington made the statement at issue, and in fact
admitted to the statement.
Either Mr. Pennington was truthful
when he made the statement, or made a false representation.”
[Summary Judgment Opp. at 41 (footnote omitted).]
position is that Pennington made the statements in his individual
capacity and on behalf of WNP and Western.
She does not
allege that Green or Bridgewater made fraudulent statements to
Instead she alleges that they are responsible for the
promises that Pennington made to her in his business capacities
because of Green’s and Bridgewater’s positions with WNP and
[Pltf.’s CSOF at ¶¶ 33-34.]
Even assuming, arguendo, that Plaintiff’s fraudulent
misrepresentation claim is properly pled, see 1/30/15 Order, 2015
WL 415890, at *11 (describing the heightened pleading standard
for fraud-based claims), this Court would still conclude that
Plaintiff’s claim cannot survive summary judgment.
noted in the 1/30/15 Order,
As this Court
the false representation forming the basis of a
fraud claim “must relate to a past or existing
material fact and not the occurrence of a future
event.” Joy A. McElroy, M.D., Inc. v. Maryl
Group, Inc., 107 Hawai`i 423, 433, 114 P.3d 929,
939 (Ct. App. 2005) (citations and block quote
format omitted) (emphasis in original). Further,
even if the allegations satisfy the other elements
of a fraud claim, “[f]raud cannot be predicated on
statements which are promissory in their nature,
or constitute expressions of intention, and an
actionable representation cannot consist of mere
broken promises, unfulfilled predictions or
expectations, or erroneous conjectures as to
future events[.]” Id. (citations and block quote
format omitted) (emphasis in original). The
exception to this general rule is that “[a]
promise relating to future action or conduct will
be actionable, however, if the promise was made
without the present intent to fulfill the
promise.” Id. (citations and block quote format
omitted) (emphasis in McElroy).
Id. at *10 (alterations in 1/30/15 Order) (emphasis added).
Pennington’s purported statements related to future
events - how Plaintiff would be compensated in the event that
Pennington died while she was working at the Property.
to prevail on a fraudulent misrepresentation claim based on such
statements about future events, Plaintiff must establish that
Pennington made the statements without a present intent to
fulfill the promise.
Plaintiff has not presented any evidence
that raises a triable issue of fact as to that subject.
as Plaintiff’s fraudulent misrepresentation claim against each
Defendant is based upon Pennington’s alleged promise, this Court
FINDS that Plaintiff has failed to identify sufficient evidence
to her claim, in its entirety.
Thus, there is no triable issue
of fact, and this Court CONCLUDES that Defendants are entitled to
judgment as a matter of law as to Plaintiff’s fraudulent
Defendants’ Motion for Summary Judgment
is GRANTED as to Count V.
In light of this Court’s rulings, the only remaining
claims are Count I - Plaintiff’s breach of implied contract claim
- and Count VI - Plaintiff’s promissory estoppel claim.
undisputed that Pennington hired Plaintiff, but she argues that
he was acting both in his individual capacity and in his
capacities with WNP and Western when he hired her.
submitted, inter alia, organizational documents for the two
entities, [Summary Judgment Opp., Exh. 1 (documents regarding
Western), Exh. 2 (documents regarding WNP),] as well as evidence
that she was paid by checks from Western and WNP throughout her
[Pltf.’s Decl. at ¶ 55, Exh. 14 (sample checks).]
This Court therefore FINDS that she has presented sufficient
evidence to raise triable issues of fact as to her claims against
the Trustee Defendants, Western, and WNP.
Plaintiff, however, has not presented any evidence that
would support a breach of implied contract claim or a promissory
estoppel claim against either Green or Bridgewater, individually.
At most, they are relevant witnesses regarding Plaintiff’s claims
against the other Defendants.
This Court FINDS that Plaintiff
has failed to identify sufficient evidence to support her claims
in Counts I and VI against Green and Bridgewater.
Thus, there is
no triable issue of fact, and this Court CONCLUDES that Green and
Bridgewater are entitled to judgment as a matter of law.
Defendants’ Motion for Summary Judgment is GRANTED as to the
portions of Counts I and VI against Green and Bridgewater.
III. Plaintiff’s Request for Summary Judgment
and Defendants’ Motion to Dismiss
In the Summary Judgment Opposition, Plaintiff asks this
Court to award summary judgment in her favor pursuant to Fed. R.
Civ. P. 56(f)(1) and Local Rule 56.1(i).
The only remaining
claims are Counts I and VI, and this Court has found that there
are genuine issues of material fact as to those claims.
Court therefore cannot grant summary judgment in Plaintiff’s
favor as to those claims.
Further, in light of this Court’s rulings regarding
Defendants’ Motion for Summary Judgment, this Court CONCLUDES
that their Motion to Dismiss is moot.
On the basis of the foregoing, Defendants’ Motion for
Summary Judgment, filed June 26, 2015, is HEREBY GRANTED IN PART
AND DENIED IN PART.
Specifically, this Court: 1) GRANTS summary
judgment in favor of Defendants as to Counts II, III, IV, V, and
VII; 2) GRANTS summary judgment in favor of Defendants Kent Green
and Rachel Bridgewater as to Counts I and VI; and 3) DENIES
Defendants’ Motion for Summary Judgment as to all other portions
of Counts I and VI.
There being no remaining claims against
Green and Bridgewater, this Court DIRECTS the Clerk’s Office to
terminate them as parties.
In light of this Court’s rulings on the Motion for
Summary Judgment, Plaintiff’s request for summary judgment
pursuant to Fed. R. Civ. P. 56(f)(1) and Local Rule 56.1(i) is
HEREBY DENIED, and Defendants’ Motion to Dismiss the Third
Amended Complaint for Damages and Equitable Relief, filed May 19,
2015, is HEREBY DENIED AS MOOT.
IT IS SO ORDERED.
DATED AT HONOLULU, HAWAII, September 30, 2015.
/s/ Leslie E. Kobayashi
Leslie E. Kobayashi
United States District Judge
RONI DU PREEZ VS. RICK BANIS, ET AL; CIVIL 14-00171 LEK-RLP;
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION FOR
SUMMARY JUDGMENT AND DENYING AS MOOT DEFENDANTS’ MOTION TO
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