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                                                       Electronically Filed
                                                       Supreme Court
                                                       SCWC-XX-XXXXXXX
                                                       02-MAR-2020
             IN THE SUPREME COURT OF THE STATE OF HAWAII
                                                       08:00 AM
                            ---oOo---
________________________________________________________________

                    DONNA H. YAMAMOTO, an individual,
                     Petitioner/Plaintiff-Appellant,

                                      vs.

 DAVID W.H. CHEE; TOM CHEE WATTS DEGELE-MATHEWS & YOSHIDA, LLP,
               Respondents/Defendants-Appellees.
________________________________________________________________

                               SCWC-XX-XXXXXXX

           CERTIORARI TO THE INTERMEDIATE COURT OF APPEALS
                   (CAAP-XX-XXXXXXX; 1CC151001696)

                                MARCH 2, 2020

             NAKAYAMA, McKENNA, POLLACK, AND WILSON, JJ.,
          WITH RECKTENWALD, C.J., CONCURRING AND DISSENTING

                   OPINION OF THE COURT BY McKENNA, J.


                             I.     Introduction

       This case concerns whether attorney Donna H. Yamamoto

(“Yamamoto”) is required to arbitrate claims against Tom Chee

Watts Degele-Mathews & Yoshida, LLP (the “Law Firm” or

“Partnership”) and Law Firm Partner David W.H. Chee (“Chee”)

(collectively, “Defendants”) contained in her August 27, 2015
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complaint filed in the Circuit Court of the First Circuit1

(“circuit court”).

       When Yamamoto, a founding partner of the Law Firm, left the

Partnership, she handed Chee a personal check made payable to

the Law Firm to repay a 401(k) loan.             Chee allegedly knew that

the 401(k) loan had already been repaid from Yamamoto’s

Partnership capital account but did not inform Yamamoto.                When

Yamamoto later demanded that Defendants return the funds from

her personal check, Defendants refused.

       After Yamamoto filed suit, on December 16, 2015, Defendants

moved to compel arbitration of Yamamoto’s claims (“motion to

compel”).     Defendants asserted that the agreement founding the

Partnership (the “Partnership Agreement”), signed by Yamamoto,

required the arbitration of any disputes “in connection with”

that agreement.      The circuit court granted Defendants’ motion to

compel, concluding Yamamoto’s claims arose out of the

Partnership Agreement, and therefore the arbitration clause

applied.     Additionally, the circuit court concluded Defendants

had provided appropriate notice to initiate the arbitration

under Hawaiʻi Revised Statutes (“HRS”) § 658A-9 (Supp. 2001).2


1
       The Honorable Edwin C. Nacino presided.
2
       HRS § 658A-9 (Supp. 2001) provides as follows:
             (a) A person initiates an arbitration proceeding by giving
             notice in a record to the other parties to the agreement to
             arbitrate in the agreed manner between the parties or, in
             the absence of agreement, by certified or registered mail,

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       The Intermediate Court of Appeals (“ICA”) affirmed the

circuit court, concluding Defendants had provided adequate

notice and that Yamamoto’s allegations “touch[ed] [the]

matter[]” of the handling of her Partnership capital account,

which was covered by the Partnership Agreement.             Yamamoto v.

Chee, CAAP-XX-XXXXXXX, at 4 (App. Apr. 13, 2018) (SDO).

Yamamoto asserts the ICA erred on both issues, and presents the

following two questions in her certiorari application:

             A. Whether the [ICA] used the wrong test and ignored
             precedent to determine the arbitrability of a dispute under
             an agreement?

             B. Whether strict compliance with § 658A-9, HRS is required
             and if so, whether the statute is jurisdictional?

             Corollary: Whether it is reversible error to allow a party,
             effectively, to give a proper § 658A-9, HRS notice after
             that party filed a motion to compel?

       For the reasons set forth below, we hold the ICA erred when

it concluded that (1) Yamamoto’s claims were “in connection

with” the Partnership Agreement, and (2) compliance with HRS §

658A-9’s notice requirements is not required to initiate

arbitration.




             return receipt requested and obtained, or by service as
             authorized for the commencement of a civil action. The
             notice shall describe the nature of the controversy and the
             remedy sought.

             (b) Unless a person objects for lack or insufficiency of
             notice under section 658A-15(c) before the beginning of the
             arbitration hearing, by appearing at the hearing the person
             waives any objection to lack of or insufficiency of notice.

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       Accordingly, we vacate the ICA’s May 15, 2018 Judgment on

Appeal and remand this case to the circuit court for further

proceedings consistent with this opinion.

                                  II.   Background

       The Law Firm, a limited liability law partnership, was

formed effective January 1, 2012 pursuant to a Partnership

Agreement signed by Yamamoto, Chee, and others.             Yamamoto was a

partner in the Law Firm for eight months until August 31, 2012.

Chee, the chairperson of the Law Firm’s management committee,

apparently wished to move the Law Firm’s 401(k) accounts to

another company, to be managed by his personal financial

advisor.     To accomplish the move, Chee proposed that the Law

Firm pay all loans made against the 401(k) accounts.              Then, once

the 401(k) accounts were moved to the new management company,

new loans would be made against the 401(k) accounts to repay the

Law Firm.

       Yamamoto had a loan against her 401(k) account in the

amount of $19,134.31.       Yamamoto and Chee agreed that she would

repay the Law Firm directly when she received the distribution

of her 401(k) funds after she left the partnership.              However, on

August 31, 2012, the Law Firm allegedly debited $19,134.31 from

Yamamoto’s Partnership capital account to repay the loan without

her knowledge or consent.



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       Unaware that her Partnership capital account had already

been debited $19,134.31 to repay the Law Firm, Yamamoto handed

Chee a personal check payable to the Law Firm for the same

amount.    Yamamoto apparently told Chee that the check was to

repay the firm as they had previously agreed.            Additionally, the

memo line of the personal check read “401K loan repay.”

       Chee allegedly knew the Law Firm had already been repaid

but concealed from Yamamoto that he had already debited

Yamamoto’s capital account in the amount of $19,143.31.

Yamamoto made numerous requests for the return of the funds

obtained from her personal check, but Defendants refused to

return them.     Yamamoto then filed a three-count complaint in the

circuit court on August 27, 2015, asserting claims for

conversion, fraudulent conversion, and punitive damages.

       On November 27, 2015, before Defendants’ deadline to answer

the complaint, Defendants’ counsel e-mailed Yamamoto’s counsel

requesting that Yamamoto dismiss her complaint and submit the

matter to arbitration pursuant to Article XIII, section 13.10 of

the Partnership Agreement.”         This section states in its entirety

(with emphasis added):

             Arbitration. In the event of any dispute between or among
             the Partners in connection with this Agreement, such
             dispute shall be resolved by arbitration as follows: said
             dispute shall be determined by a single arbitrator mutually
             agreed upon by the Partners involved; otherwise the
             arbitrator shall be selected by the executive in charge of
             the Honolulu office of Dispute Prevention & Resolution,
             Inc. The arbitrator shall be neutral and qualified by
             reason of education and experience. The parties to the

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             arbitration shall waive the rights provided in HRS §658A-
             15(b)(2), and the fourth sentence of (c), 17(c), and 21
             (a), (c) and (e). The decision of the arbitrator selected
             in either manner shall be final, conclusive and binding on
             all parties to the arbitration. The decision may be
             enforced under HRS Chapter 658A. The allocation of the
             costs and expenditures of the arbitration, including
             attorneys’ fees and costs of the parties, shall be
             allocated between or among the parties to such arbitration
             as the arbitrator shall determine.

       On December 16, 2015, Defendants filed a motion to dismiss,

the motion to compel, and a request for attorney’s fees and

costs.    With respect to the motion to compel, Defendants argued

that Yamamoto’s complaint consisted of claims that arose in

connection with Plaintiff’s status as a partner of the Law Firm.

Defendants asserted Yamamoto’s claims “arose in reference to the

law partnership because she seeks the recovery of moneys that

she allegedly paid to [the Law Firm] with respect to a loan on

her 401K account with [the Law Firm].”           Defendants explained,

“All of Plaintiff’s claims hinge on the allegation that

$19,143.31 was deducted from her capital account and paid to

[the Law Firm] in advance of her repaying that same amount to

the firm.     To establish the truth or falsity of that central

allegation requires an analysis of Plaintiff’s capital account

and the credits and deductions to that account that were made in

accordance with the Partnership Agreement.”

       In her response, Yamamoto argued that Defendants failed to

comply with the notice requirements of HRS § 658A-9, which

requires that absent an agreement between the parties regarding


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the manner in which to initiate arbitration, arbitration may

only be initiated “by certified or registered mail, return

receipt requested and obtained, or by service as authorized for

the commencement of a civil action.”          As the Partnership

Agreement does not address the manner in which parties should

initiate arbitration, and as Defendants’ e-mail did not comply

with the statutory notice requirements, Yamamoto argued the

motion to compel should be denied pursuant to Ueoka v.

Szymanski, 107 Hawai‘i 386, 395-96, 114 P.3d 892, 901-02 (2005)

(“[W]e believe that requiring a party to initiate arbitration

before filing a motion to compel arbitration best supports the

policy reasons behind encouraging arbitration . . . .              HRS §

658A-9 . . . requires that the person seeking to initiate an

arbitration proceeding satisfy certain formal requirements.”).

       Yamamoto also argued that the arbitration clause in the

Partnership agreement did not apply to her claims because they

are for conversion, or “civil theft” of the funds from her

personal check, not Defendants’ use of her capital account funds

to repay the Law Firm.       She posited that the Partnership

Agreement does not require arbitration of conversion or theft

claims.    Yamamoto argued that the Law Firm was organized “solely

for the purpose of rendering legal services and services

ancillary thereto,” unrelated to the conversion of personal

property.     Thus, Yamamoto contended that regardless of whether

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“in connection with” is read narrowly or broadly, the conversion

of personal funds “cannot possibly lie within the scope of an

agreement covering the rendering of legal services.”              Moreover,

Yamamoto argued, at the time she handed the personal check to

Chee, she was no longer a partner in the firm, underscoring that

the transaction did not hinge on her former partnership status.

       On January 13, 2016, subsequent to the filing of Yamamoto’s

response but before the January 19, 2016 hearing date,

Defendants filed with their reply a copy of a letter dated

January 12, 20163 sent by certified mail, return receipt

requested, demanding arbitration of Yamamoto’s complaint

pursuant to Section 13.10 of the Law Firm’s Partnership

Agreement.     The letter stated in its entirety:

             This letter represents Defendants’ written demand for
             arbitration of Plaintiff’s Complaint filed August 27, 2015
             under 13.10 of the Partnership Agreement. This written
             demand for arbitration is being sent pursuant to Haw. Rev.
             Stat. § 658-9.

Also attached to the January 13, 2016 filing was a copy of

Defendants’ November 27, 2015 e-mail.           The record does not

reflect whether Defendants obtained a return receipt for the

January 12, 2016 letter.

       At the January 19, 2016 hearing, the circuit court granted

Defendant’s motion to compel, concluding that Yamamoto’s



3
      Although the letter is dated “January 12, 2015,” Defendants have noted
the year should have read “2016.”

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arguments were “form over substance,” as “[o]ur jurisdiction

favors ADR in lieu of litigation.”

       Yamamoto timely appealed the circuit court’s order granting

Defendant’s motion to compel, and presented two points of error:

             1.   The circuit court erred in the construction and legal
                  effect of the arbitration clause in finding that
                  conversion of personal funds fell within the scope of
                  the arbitration clause in the partnership agreement
                  between Plaintiff-Appellant and Defendants-Appellants
                  entered into to provide legal and ancillary services
                  thereto . . . .

             2. The circuit court erred in finding that strict
                compliance with the formal notice requirements in
                Section 658A-9 HRS was not required before filing a
                motion to compel arbitration pursuant to Section 658A-7,
                HRS . . . .

The ICA affirmed the circuit court’s order.              Yamamoto, SDO at 9.

       With respect to whether Defendants had issued proper notice

pursuant to HRS § 658A-9, the ICA concluded the circuit court did

not err in determining that the January 12, 2016 letter had

satisfied statutory notice requirements, even though the letter

was mailed nearly a month after the motion to compel.                See

Yamamoto, SDO at 8.         According to the ICA, Ueoka does not

mandate the denial of a motion to compel where notice is given

after the filing of the motion.              See Yamamoto, SDO at 7.       The

ICA first opined that Ueoka was distinguishable because, in that

case, this court noted that the parties who sought arbitration

had not filed a demand for arbitration at any time “[d]espite

the circuit court’s stated willingness to reconsider the stay

issue if a demand for arbitration was filed.”              Yamamoto, SDO at

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7 (quoting Ueoka, 107 Hawai‘i at 395, 114 P.3d at 901).

Accordingly, the ICA reasoned, nothing in Ueoka prohibits the

parties from curing any defective notice.

       Second, the ICA explained that the written notice

requirement in the Uniform Arbitration Act, upon which HRS

chapter 658A is based, “serves as the functional equivalent of

notice pleading in a court action.”          Yamamoto, SDO at 6 (quoting

Block v. Plosia, 916 A.2d 475, 482 (N.J. App. Div. 2007)).

Thus, the ICA concluded, because the January 12, 2016 letter

“demand[ed] arbitration of []Plaintiff’s Complaint,” and because

a copy of the November 27, 2015 e-mail stating that Defendants

sought to resolve Yamamoto’s claims by arbitration pursuant to

the Partnership Agreement’s arbitration clause was attached to

the letter, Defendants had provided “a short and plain

statement” that sufficiently “notified Yamamoto of what they

wanted to arbitrate.”       See Yamamoto, SDO at 6-7.

       Third, according to the ICA, although “initiating

arbitration before filing a motion to compel ‘best supports’ the

statute’s rationale” of promoting alternative methods of dispute

resolution in an effort to reduce litigation, it would be

inconsistent with the arbitration statutes’ stated policy to

reduce the caseload of the courts to (1) deny the motion to

compel, (2) require a new demand to be made, and (3) then



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require a new motion to compel before hearing a motion to compel

arbitration.     See Yamamoto, SDO at 8-9.

       As to whether the arbitration clause of the Partnership

Agreement encompassed Yamamoto’s claims, the ICA’s analysis

focused on the “in connection with” language from the clause:

“In the event of any dispute between or among the Partners in

connection with this Agreement, such dispute shall be resolved

by arbitration . . . .”        Yamamoto, SDO at 3 (emphasis in

original).     The ICA first observed that other courts have

construed “arising in connection with” (which the ICA viewed as

no different from “in connection with”) broadly when addressing

arbitration clauses.       Yamamoto, SDO at 3 (citing Simula, Inc. v.

Autoliv, Inc., 175 F.3d 716, 721 (9th Cir. 1999); Coffman v.

Provost * Umphrey Law Firm, L.L.P., 161 F. Supp. 2d 720, 725

(E.D. Tex. 2001), aff’d sub nom. Coffman v. Provost Umphrey LLP,

33 F.Appx 705 (5th Cir. 2002)).

       The ICA then turned to Yamamoto’s specific factual

allegations, as “[w]hether a claim falls within the scope of an

arbitration agreement turns on the factual allegations in the

complaint.”     Yamamoto, SDO at 4 (quoting Cty. of Hawaiʻi v.

Unidev, LLC, 129 Hawai‘i 378, 396, 301 P.3d 588, 606 (2013)).

The ICA summarized Yamamoto’s allegations as follows:

             (1) Chee debited [Yamamoto’s] partnership capital account
             without her consent; (2) Chee concealed the fact that
             Yamamoto’s loan was repaid out of her partnership capital
             account, still accepted her personal check and used it for

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             purposes other than repaying the 401k loan; and (3) neither
             Chee nor [the Law Firm] have returned the funds, despite
             numerous demands from Yamamoto.

Yamamoto, SDO at 4.       The ICA then examined whether these

allegations “touched matters” covered by the Partnership

Agreement.     Yamamoto, SDO at 4 (quoting Simula, 175 F.3d at 721

(“To require arbitration, [Plaintiff’s] factual allegations need

only ‘touch matters’ covered by the contract containing the

arbitration clause . . . .”)).         The ICA concluded that they did;

specifically, Yamamoto’s allegations regarding the handling of

her Partnership capital account “touch[ed] matters” covered by

the Partnership Agreement.        As such, the ICA held the circuit

court did not err in concluding that the factual allegations in

Yamamoto’s Complaint fell within the scope of the arbitration

clause.    See Yamamoto, SDO at 5.

       For the foregoing reasons, the ICA affirmed the circuit

court’s March 9, 2016 Order Compelling Arbitration.              Yamamoto,

SDO at 9.

                         III. Standards of Review

A.     Statutory Interpretation

       Statutory interpretation is a question of law reviewable de

novo.    See Citizens Against Reckless Dev. v. Zoning Bd. of

Appeals, 114 Hawaiʻi 184, 193, 159 P.3d 143, 152 (2007) (citation

omitted).     When construing statutes, the court is governed by

the following rules:

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                First, the fundamental starting point for statutory
             interpretation is the language of the statute itself.
             Second, where the statutory language is plain and
             unambiguous, our sole duty is to give effect to its plain
             and obvious meaning. Third, implicit in the task of
             statutory construction is our foremost obligation to
             ascertain and give effect to the intention of the
             legislature, which is to be obtained primarily from the
             language contained in the statute itself. Fourth, when
             there is doubt, doubleness of meaning, or indistinctiveness
             or uncertainty of an expression used in a statute, an
             ambiguity exists.
                When there is ambiguity in a statute, “the meaning of
             the ambiguous words may be sought by examining the context,
             with which the ambiguous words, phrases, and sentences may
             be compared, in order to ascertain their true meaning.”
             Moreover, the courts may resort to extrinsic aids in
             determining legislative intent, such as legislative
             history, or the reason and spirit of the law.

114 Hawaiʻi at 193-94, 159 P.3d at 152-53 (citations omitted.)

B.     Motion to Compel Arbitration

       A motion to compel arbitration is reviewed de novo and

based on the same standard that applies to a summary judgment

ruling.    See Koolau Radiology, Inc. v. Queen’s Med. Ctr., 73

Hawaiʻi 433, 440, 834 P.2d 1294, 1298 (1992) (“[W]e review this

case [motion to compel arbitration] de novo, using the same

standard employed by the trial court and based upon the same

evidentiary materials as were before it in determination of the

motion.” (citations, internal quotation marks, and alterations

omitted)).

C.     Contract Interpretation

             As a general rule, the construction and legal effect to be
             given a contract is a question of law freely reviewable by
             an appellate court. The determination whether a contract
             is ambiguous is likewise a question of law that is freely
             reviewable on appeal. These principles apply equally to
             appellate review of the construction and legal effect to be
             given a contractual agreement to arbitrate.


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Brown v. KFC Nat’l Mgmt. Co., 82 Hawaiʻi 226, 239, 921 P.2d 146,

159 (1996) (internal quotation marks and citations omitted).

                               IV.   Discussion

A.     Arbitration must be initiated pursuant to HRS § 658A-9
       prior to the filing of a motion to compel arbitration under
       HRS § 658A-7.

       On certiorari, Yamamoto again argues that Ueoka, 107 Hawaiʻi

386, 114 P.3d 892, mandates strict compliance with HRS § 658A-

9’s notice requirements.        According to Yamamoto, Defendants

neither complied with the timing nor content of the notice

requirements under the statute.         Defendants, on the other hand,

reiterate that Yamamoto’s arguments as to notice are “form over

substance,” as she does not assert she was uncertain as to why

the e-mail and letter were sent, or for which claims arbitration

was being sought.      Moreover, Defendants argue that requiring

literal compliance with the arbitration initiation statute would

produce an absurd and unjust result.

       Yamamoto correctly asserts that Ueoka is instructive.                 That

case involved the sale of real property from Okuno to Szymanski

(“first contract”), and the immediate re-sale of the property by

Szymanski to Hartley (“second contract”).           See 107 Hawai‘i at

388, 114 P.3d at 894.       Both contracts contained arbitration

provisions, and both sales hinged on, among other things, the

installation of four water meters on the property.             When issues

arose regarding the installation of the requisite water meters,

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Szymanski requested mediation, but Okuno refused and filed a

complaint in circuit court.          See 107 Hawai‘i at 389, 114 P.3d at

895.     Hartley then intervened in that case, to which Szymanski

filed a statement of no position, and Hartley also separately

filed a lawsuit against Okuno and Szymanski.             See id.    Szymanski

then filed a motion to stay all court proceedings initiated by

Hartley pending arbitration, which was denied.             See 107 Hawai‘i

at 391, 114 P.3d at 897.

        On appeal, this court clarified that HRS § 658A-9 applies

to any party to an arbitration agreement that wishes to initiate

arbitration, and is not limited to a party asserting a claim.

See 107 Hawai‘i at 395, 114 P.3d at 901.            We then rejected

Szymanski’s arguments that he satisfied the notice requirements

of HRS § 658A-9 when he “demand[ed] arbitration in filing two

circuit court documents: (1) his statement of no position on

Hartley’s application to intervene, and (2) his motion to stay

proceedings pending arbitration.”            Id.   We observed that

“[w]hile those pleadings may demonstrate Szymanski’s intent to

invoke arbitration, they do not satisfy the statutory

requirements of HRS § 658A-9 for the initiation of arbitration.”

Id.

        We went on to analyze HRS § 658A-7 (Supp. 2001), which

governs motions to compel or stay arbitration, in pari



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materia with HRS § 658A-9.        HRS § 658A-7 states in relevant

part:

             Motion to compel or stay arbitration. (a) On motion of a
             person showing an agreement to arbitrate and alleging
             another person’s refusal to arbitrate pursuant to the
             agreement:

             (1) If the refusing party does not appear or does not
             oppose the motion, the court shall order the parties to
             arbitrate; and

             (2) If the refusing party opposes the motion, the court
             shall proceed summarily to decide the issue and order the
             parties to arbitrate unless it finds that there is no
             enforceable agreement to arbitrate.

HRS § 658A-7(a).      We concluded that “[i]n the absence of

Szymanski’s satisfaction of those requirements for initiation of

the arbitration proceeding, Hartley cannot be found to have

refused to arbitrate,” and therefore the circuit court was not

obligated to order arbitration.         Ueoka, 107 Hawai‘i at 396, 114

P.3d at 902.

       Pursuant to these guiding principles, the circuit court

erred in granting Defendants’ motion to compel.             At the time

Defendants filed their motion, no letter had been issued by

certified mail, no return receipt had been obtained, and

therefore any allegations in the motion that Yamamoto had

refused to arbitrate were baseless as a matter of law.                 Further,

to permit Defendants to “cure” the notice defect after Yamamoto

had submitted her response to the motion to compel, as the ICA

allowed, effectively restricted Yamamoto’s right to object in

writing to the motion, especially because HRS § 658A-7(a) tasks

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the court to “proceed summarily,” i.e., expeditiously,4 to decide

the issue of arbitrability.         This goes to the heart of Ueoka’s

holding that a party “cannot be found to have refused to

arbitrate” until the formal requirements for initiating an

arbitration are met.

       The ICA’s reasoning that “requiring a motion to compel

arbitration to be denied, a new demand to be made, and then a

new motion to compel to be filed[] would be inconsistent with

the policy considerations” encouraging arbitration recognized by

this court, see Ueoka, 107 Hawaiʻi at 395, 114 P.3d at 901, fails

to consider that the formal mechanisms for initiating

arbitration under HRS § 658A-9 are meant to systemically reduce

litigation at the outset.        Yamamoto, SDO at 8-9.       In other

words, requiring the preliminary step of formally initiating

arbitration pursuant to HRS § 658A-9 before filing an HRS §


4
      Chapter 658 is based on the Uniform Arbitration Act (Unif. Law Comm’n
2000). See Conf. Comm. Rep. No. 115, in 2001 House Journal, at 1093-94. In
a comment to the Uniform Arbitration Act, “summarily” is noted to have been
defined to mean that a trial court should act expeditiously and without a
jury trial to determine whether a valid arbitration agreement exists.” Unif.
Arbitration Act § 7 cmt. (citation omitted); see, e.g., Stenzel v. Dell,
Inc., 870 A.2d 133, 139 (Me. 2005) (quoting id.); Netco, Inc. v. Dunn, 194
S.W.3d 353, 362 (Mo. 2006), as modified on denial of reh’g (June 30, 2006)
(“Although this court has not expressly addressed the meaning of the term
‘proceed summarily,’ and the statute does not provide a special definition,
under the legal definition, which this court now adopts, summary proceedings
are those that are conducted ‘without the usual formalities and without a
jury.’” (quoting Black’s Law Dictionary 1476 (8th ed. 1999) (brackets
omitted)). The Colorado Supreme Court considered the comment to Uniform
Arbitration Act § 7, when it concluded that if, after considering affidavits,
pleadings, discovery, and stipulations submitted by the parties a court
determines that material issues of fact exist, “it must conduct an expedited
evidentiary hearing to resolve the dispute.” J.A. Walker Co. v. Cambria
Corp., 159 P.3d 126, 130 (Colo. 2007) (citation and brackets omitted).

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658A-7 motion is intended to reduce litigation, e.g., the filing

of motions to compel or to stay arbitration in court.              Thus,

permitting the filing of a motion to compel arbitration before

the initiation of arbitration proceedings actually increases the

amount of litigation in the courts.          Ueoka recognized such

considerations, noting that “[a]llowing a party to compel

arbitration after filing a lawsuit (without filing a notice

initiating arbitration) does nothing to avoid litigation or

reduce the number of cases crowding our courts.”             Ueoka, 107

Hawaiʻi at 395, 114 P.3d at 901.

       Therefore, the ICA erred in affirming the circuit court’s

order granting Defendants’ motion to compel despite Defendants’

failure to initiate arbitration pursuant to HRS § 658A-9 before

filing a motion to compel arbitration pursuant to HRS § 658A-7.

       We therefore hold that the requirements of HRS § 658A-9

must be met before a party files a motion to compel arbitration.

B.     As the arbitration clause does not encompass
       Yamamoto’s claims for conversion, the ICA erred in
       affirming the circuit court’s order granting
       defendants’ motion to compel arbitration.

       We next address whether Yamamoto’s claim falls within the

scope of the Partnership Agreement’s arbitration clause.                On

certiorari, Yamamoto takes issue with the ICA’s use of two cases

to support its conclusion that her claims must be arbitrated:

Simula, 175 F.3d 716, and Coffman, 161 F. Supp. 2d 720.                She


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first argues that the ICA’s use of the “touch matters” test from

Simula ignores another of Simula’s requirements: for an

arbitration clause, which employs “arising in connection with”

language, to reach a dispute, that dispute must first have a

“significant relationship to the contract” or “hav[e] [its]

origin or genesis in the contract[,]” citing Simula, 173 F.3d at

721.

        Second, she points out that Coffman, 161 F. Supp. 2d 720,

which the ICA cited to support its interpretation of the scope

of the phrase “in connection with,” had also noted: “Just

because the Partnership Agreements may be referred to as

evidence, however, does not make Plaintiff’s . . . claims

arbitrable.      Because Plaintiff’s . . . claims could be

maintained independently of the contract, such claims do not

fall within the scope of the arbitration clause.”              161 F. Supp.

2d at 732 (citations omitted).          Yamamoto points out that Coffman

further explained that the test in the Fifth Circuit is whether

“the . . . claim was so interwoven with plaintiff’s rights under

contract that plaintiff ‘could have just as easily alleged a

breach of contract action.’”          Ford v. NYLCare Health Plans of

Gulf Coast, Inc., 141 F.3d 243, 250 (5th Cir. 1998) (citation

omitted).      Thus, in Coffman, which involved an employee of a law

firm who had signed a partnership agreement containing an

arbitration clause, the Texas federal district court determined

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that the plaintiff’s breach of fiduciary duty claim was

arbitrable because it could be re-labeled as a breach of

contract action, whereas her claims for violation of Title VII

were not arbitrable.       161 F. Supp. 2d at 733.

       Yamamoto also argues that the ICA failed to consider the

entire Partnership Agreement before determining the scope of the

arbitration clause, contrary to Yogi v. Hawaii Med. Serv. Ass’n,

124 Hawaiʻi 172, 238 P.3d 699 (App. 2010).           In that case, after a

patient successfully appealed to the Hawaiʻi Insurance

Commissioner HMSA’s repeated denials of a preauthorization

request for a medical procedure recommended by the patient’s

physician, the patient brought suit for damages against HMSA,

alleging that HMSA acted unreasonably, wantonly, and

oppressively in denying the preauthorization request.              See Yogi,

124 Hawaiʻi at 174, 238 P.3d at 701.          HMSA sought to compel

arbitration of patient’s claims, citing an arbitration clause

contained in the patient’s medical plan with HMSA.             See id.       The

ICA ultimately affirmed the circuit court’s denial of HMSA’s

motion to compel arbitration.         See Yogi, 124 Hawaiʻi at 178-79,

238 P.3d at 705-06.       After examining the entire medical plan,

the ICA construed the plan to mean that arbitration was an

option that may be selected by a plan enrollee to challenge an

HMSA determination; the other option was a review by a panel

appointed by the Hawaiʻi Insurance Commissioner.            See Yogi, 124

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Hawaiʻi at 177, 238 P.3d at 704.            Because an Insurance

Commissioner-appointed panel was not statutorily authorized to

award money damages, the ICA reasoned the arbitration agreement

likewise was not intended to encompass claims for money damages.

See Yogi, 124 Hawaiʻi at 178, 238 P.3d at 705.            Alternatively,

the ICA also commented that at best, the arbitration agreement

was ambiguous, and that any ambiguity should be construed

against HMSA as the drafter.         See Yogi, 124 Hawaiʻi at 179, 238

P.3d at 706.

       As to the scope of the arbitration clause in this case,

Defendants assert that Yamamoto’s conversion count is not a

“stand-alone claim” because “[w]hether Defendants must refund

moneys to Plaintiff is only determined by whether Plaintiff

actually overpaid her loan from the Law Firm,” which “can only

be decided by examining the accounting entries in her capital

account to verify whether the entries indicate or [do] not

indicate the loan was repaid from moneys transferred from

Plaintiff’s capital account.”         Defendants support the ICA’s

broad interpretation of “in connection with,” [SC DOC 6:10] and

interpret the Ninth Circuit’s Simula decision to mean that “a

direct nexus between the claims and the contract’s subject

matter” is not required for claims to be arbitrable so long as

the “claims ‘touch matters’ covered by that contract” containing

the arbitration agreement.

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       In Yamamoto’s reply, she emphasizes that the ICA’s decision

essentially disregards an individual’s right to a civil jury

trial in favor of a State policy that supports alternative

dispute resolution.       Yamamoto suggests the ICA’s decision

creates a slippery slope that will effectively “chill acceptance

of arbitration clauses, by impermissibly expanding [their] scope

to include virtually any dispute neither covered by the

agreement nor contemplated by the parties.”

       To determine whether the Partnership Agreement’s

arbitration clause encompasses Yamamoto’s claims for conversion,

it is necessary to analyze the language of the arbitration

clause and review Yamamoto’s allegations regarding Chee’s

arrangement to transfer the 401(k) accounts of the Law Firm’s

employees to Chee’s financial advisor.

       The Partnership Agreement’s arbitration clause states, “In

the event of any dispute between or among the Partners in

connection with this Agreement, such disputed shall be resolved

by arbitration . . . .”        As an initial matter, Yamamoto argued

before the circuit court that because the clause applies only to

“any dispute between or among the Partners,” the arbitration

clause did not apply to Yamamoto’s complaint because she was not

a Partner at the time of the alleged conversion.             Yamamoto’s

claim did not arise until after she was no longer a partner, and

Chee took her personal check.         Yamamoto also argued before the

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ICA that the arbitration clause did not apply because Chee’s

arrangement was unrelated to the Partnership’s sole purpose of

“rendering legal services and services ancillary thereto.”                    We

examine this issue further as “the construction and legal effect

to be given a contract is a question of law freely reviewable by

an appellate court.”       Brown, 82 Hawai‘i at 239, 921 P.2d at 159.

       Preliminarily, we note that the term “Partner” is

capitalized in the arbitration clause.           The Partnership

Agreement defines “Partner” as “each of the parties whose

signatures appear at the end hereof.”           The recitals at the start

of the Agreement state:

             This Partnership Agreement is executed with reference to
             the following:

                   A. Each of the parties hereto desires to form a
             limited liability law partnership . . . .

                   B. Each of the parties further desires to set forth
             the terms and conditions for the conduct of the Partnership
             business.

                   NOW, THEREFORE, in consideration of the premises, the
             parties hereby agree as follows: . . . .

(Emphases added.)      Accordingly, each of the Articles in the

Partnership Agreement, including the arbitration clause at

Section 13.10, must be viewed in the light of the “premises”

stated in the recitals, i.e., the arbitration clause must be

read as a “term[] and condition[] for the conduct of the

Partnership business.”       Further, as argued by Yamamoto, the

Partnership Agreement’s “purpose” clause, Article 1.3,


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specifically provides that “[t]he Partnership is organized

solely for the purpose of rendering legal services and services

ancillary thereto.” (Emphasis added.)

       With these considerations in mind, there are two notable

points when examining the arbitration clause, which states: “In

the event of any dispute between or among the Partners in

connection with this Agreement, such dispute shall be resolved

by arbitration . . . .”        First, Yamamoto was a “Partner,” as she

had signed the Partnership Agreement.           Second, her signature was

affixed to the Partnership Agreement “to form a limited

liability law partnership,” and to “set forth the terms and

conditions for the conduct of the Partnership business.”                Thus,

as “the Partnership business” was not to lend money or

administer 401(k) plans, Chee’s arrangement falls outside “the

Partnership business.”       Therefore, any claims arising from the

arrangement do not comprise a “dispute . . . in connection with

this Agreement” and are therefore not subject to the arbitration

clause.5

       The ICA’s SDO focused solely on the phrase “in connection

with” without considering the context of the clause within the

5
      The dissent highlights portions of Article III of the Partnership
Agreement governing “capital accounts,” including a provision stating that
upon withdrawal, a Partner would be entitled to only the amount in that
Partner’s capital account. Yamamoto’s complaint does not request relief
regarding her capital account; rather she alleges conversion (Count I),
fraudulent conversion (Count II), and punitive damages (Count III) based on
the wrongful retention of the personal check she wrote to repay her 401(k)
loan.

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Partnership Agreement.        The arbitration clause applies “to the

conduct of the Partnership business” as specified in the

Partnership Agreement.

        The ICA compared this case to Unidev, 129 Hawai‘i 378, 301

P.3d 588, and concluded that just as the court found the claims

in Unidev arbitrable, so, too, should Yamamoto’s claims be

deemed arbitrable.        See Yamamoto, SDO at 4-5.       There, the court

concluded that because the arbitration clause contained in one

of the agreements between the parties (a housing project

developer and the County of Hawai‘i) “employed general language,”

i.e., “any dispute arising under the terms of this Agreement,”

“it may be inferred . . . that the parties did not intend to

restrict the reach of the arbitration clause simply to claims

involving construction or arbitration of the terms of the

agreement.”      Unidev, 129 Hawai‘i at 384, 394, 301 P.3d at 594,

604.     Unidev, however, is inapposite because the Partnership

Agreement here includes limiting language in its recitals such

that the arbitration clause applies only “to the conduct of the

Partnership business.”

        Thus, although “any doubts concerning the scope of

arbitrable issues should be resolved in favor of arbitration,”

“the mere existence of an arbitration agreement does not mean

that the parties must submit to an arbitrator disputes which are

outside the scope of the arbitration agreement.”              129 Hawai‘i at

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396, 301 P.3d at 606.       “An arbitration agreement is interpreted

like a contract,” and “we have long expressed our disapproval of

interpreting a contract such that any provision be rendered

meaningless.”      129 Hawai‘i at 395, 301 P.3d at 605.         The

Partnership Agreement by its own terms limited the scope of its

provisions, including the arbitration clause at section 13.10,

to “the conduct of the Partnership business.”            Yamamoto’s claim

is not based on the conduct of “Partnership business,” which was

“solely for the purpose of rendering legal services and services

ancillary thereto.”

       Thus, the claims in Yamamoto’s complaint are not subject to

the arbitration clause in the Partnership Agreement.

                               V.   Conclusion

       For these reasons, we vacate the ICA’s May 15, 2018

Judgment on Appeal and the circuit court’s March 9, 2016 Order

Compelling Arbitration.        This matter is remanded to the circuit

court for further proceedings consistent with this opinion.

Michael M. Ching and                        /s/ Paula A. Nakayama
Cheryl Y. Arakaki
for petitioner                              /s/ Sabrina S. McKenna

Gary S. Miyamoto                            /s/ Richard W. Pollack
for respondent
                                            /s/ Michael D. Wilson




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