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                                                               Electronically Filed
                                                               Supreme Court
                                                               SCAP-13-0005234
                                                               27-FEB-2017
                                                               08:01 AM




            IN THE SUPREME COURT OF THE STATE OF HAWAII

                            ---o0o---
 _______________________________________________________________

                           RUSSELL L. HUNGATE,
                          Plaintiff-Appellant,

                                     vs.

      THE LAW OFFICE OF DAVID B. ROSEN, A LAW CORPORATION,
   DAVID B. ROSEN, and DEUTSCHE BANK NATIONAL TRUST COMPANY,
                      Defendants-Appellees.
________________________________________________________________

                             SCAP-13-0005234

        APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT
      (CAAP-13-0005234; CAAP-14-0000772; CIVIL NO. 13-1-2146;
                       CIVIL NO. 13-1-2146)

                            FEBRUARY 27, 2017

 RECKTENWALD, C.J., NAKAYAMA, McKENNA, POLLACK, AND WILSON, JJ.

                  OPINION OF THE COURT BY WILSON, J.

           This case concerns a non-judicial foreclosure

conducted pursuant to Hawaii Revised Statutes (HRS) § 667 Part I
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(Supp. 2008), which was repealed by the state legislature on

June 28, 2012 by Act 182.       Plaintiff-Appellant Russell L.

Hungate (Hungate) appeals the Circuit Court of the First

Circuit’s (circuit court) order granting Defendants-Appellees

David B. Rosen’s and his law office’s (collectively, Rosen)

motion to dismiss the complaint.          Hungate also appeals the

circuit court’s order granting Defendant-Appellee Deutsche Bank

National Trust Company’s (Deutsche Bank) motion to dismiss the

first amended complaint.1

           On appeal, we consider whether the circuit court

wrongly dismissed Hungate’s claims alleging Deutsche Bank and

Rosen violated statutory, contractual, and common law duties,

and committed unfair or deceptive acts or practices (UDAP).              We

conclude the circuit court erred in dismissing the majority of

Hungate’s claims.     Accordingly, we vacate in part the circuit

court’s November 5, 2013 order granting Rosen’s motion to

dismiss, vacate in part the circuit court’s April 8, 2014 order

granting Deutsche Bank’s motion to dismiss, and remand for

further proceedings.




     1
            On appeal, Hungate’s case was split into two appellate case
numbers. SCAP-13-0005234 is Hungate’s appeal of the circuit court’s order
dismissing the original complaint. SCAP-14-0000772 is Hungate’s appeal of
the circuit court’s order dismissing the first amended complaint, which
Hungate filed after the circuit court dismissed his original complaint.
Hungate’s cases were consolidated by this court into SCAP-13-0005234.


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                               I.    Background

           Because the circuit court dismissed Hungate’s August

6, 2013 complaint and his first amended complaint, filed

December 19, 2013, pursuant to Hawaii Rules of Civil Procedure

(HRCP) Rule 12(b)(6) (2000), we take the factual allegations

from the complaints as true for purposes of this appeal.             See

Young v. Allstate Ins. Co., 119 Hawaii 403, 406, 198 P.3d 666,

669 (2008).    Hungate’s initial complaint and first amended

complaint included the following factual allegations.

A.   Factual Allegations

           Hungate secured a mortgage loan from IndyMac Bank,

F.S.B. (IndyMac), in the amount of $324,090 to purchase real

property in Kalāheo, Kauai in 2007.2        Hungate executed the

mortgage on February 10, 2007 and recorded it in the Bureau of

Conveyances on February 16, 2007.         In March 2007, IndyMac

assigned its interest in Hungate’s mortgage to one of its

subsidiaries, which then assigned its interest to Deutsche Bank.

           To address the possibility of foreclosure, the

mortgage contract included a power of sale clause that allowed

the property to be sold through a non-judicial foreclosure.                The

power of sale clause, found in section 22 of Hungate’s mortgage,

      2
            At the proceeding on Rosen’s motion to dismiss, Hungate’s counsel
represented that the property was a vacant 10,000 square foot lot with ocean
views. Hungate planned to build a “dream home” on the property but he did
not proceed with his plan after he experienced financial difficulties.


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reads in relevant part as follows: “Lender shall publish a

notice of sale and shall sell the Property at the time and place

and under the terms specified in the notice of sale.”

            On August 5, 2008, IndyMac notified Hungate that his

loan was in default because he had not made the required

payments.    On January 14, 2009, an individual acting on behalf

of IndyMac3 executed a notice of mortgagee’s intention to

foreclose under power of sale.        On March 16, 2009, the notice of

intention of foreclosure was properly filed at the Bureau of

Conveyances by IndyMac on behalf of Deutsche Bank as the holder

of the note.    The notice offered Hungate’s property for sale

with a quitclaim deed and made no warranties.

            Deutsche Bank retained Rosen, a Hawaii-licensed

attorney, to conduct the foreclosure of Hungate’s property.

Deutsche Bank followed the non-judicial foreclosure process set

forth in HRS § 667 Part I.4

            To begin the non-judicial foreclosure process, Rosen

published a notice of sale in The Garden Island, a newspaper of

general circulation, as required by former HRS § 667-5(a)(1)

(Supp. 2008).     Under HRS § 667-5(a)(1), the attorney must

     3
            The record is unclear as to whether the individual was employed
by IndyMac or another entity.
      4
            An alternative non-judicial foreclosure process with additional
statutory requirements, codified in HRS § 667 Part II (Supp. 2008), was also
available.



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publish the notice of the mortgagee’s intention to foreclose

“once in each of three successive weeks . . . in a newspaper

having a general circulation in the county in which the

mortgaged property lies[.]”       In compliance with this

requirement, Rosen published a notice of sale once a week for

three weeks on March 20, March 27, and April 3, 2009.             The

notice of sale stated a sale date of April 17, 2009.5

           Rosen then postponed the sale a total of four times in

2009: from April 17 to May 15, from May 15 to June 12, from June

12 to July 17, and from July 17 to August 14.           These dates were

never published.     Whether the postponement was publicly

announced to the bidders who attended each sale date, as

required by HRS § 667-5(d), is contested.

           At the August 14, 2009 sale, Deutsche Bank was the

sole bidder with a winning credit bid of approximately $161,250.

This amount was substantially below the market value of

Hungate’s property.      A “Mortgagee’s Grant Deed Pursuant to Power

of Sale” was recorded at the Bureau of Conveyances on October

30, 2009 by Deutsche Bank.

B.   Procedural History

           On August 6, 2013, Hungate filed his initial complaint

against Rosen and Deutsche Bank.          Hungate contended that

     5
            The notice states, in relevant part, that the mortgagee “gives
notice that Mortgagee will hold a sale by public auction on April 17, 2009 at
12:00 noon At [sic] the flagpole fronting the fifth circuit court building.”


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Deutsche Bank and Rosen wrongfully conducted the foreclosure of

Hungate’s property by (1) advertising a proposed sale date 28

days after the date of the first published notice, when HRS §

667-76 required that the sale date be at least 29 days after the

first published notice; (2) failing to publicize the postponed

sale date, in violation of the mortgage’s power of sale clause;

and (3) breaching their common law duty to secure the best

possible price for the property.          Hungate also argued that

Deutsche Bank and Rosen violated HRS § 480-27 because their

actions constituted unfair and deceptive trade acts or practices

and resulted in unfair methods of competition.

            Rosen filed a motion to dismiss under HRCP Rule

12(b)(6).    Rosen argued (1) the initial sale date was scheduled

after the expiration of four weeks, when including the date

first advertised, and thus he complied with HRS § 667-7; (2)


     6
            HRS § 667-7 (Supp. 2008) states as follows:

            (a)   The notice of intention of foreclosure shall contain:
                  (1)   A description of the mortgaged property; and
                  (2)   A statement of the time and place proposed for
                        the sale thereof at any time after the
                        expiration of four weeks from the date when
                        first advertised.

            (b)   The affidavit described under section 667-5 may
                  lawfully be made by any person duly authorized to act
                  for the mortgagee, and in such capacity conducting
                  the foreclosure.
      7
            HRS § 480-2(a) (2008) states that “[u]nfair methods of
competition and unfair or deceptive acts or practices in the conduct of any
trade or commerce are unlawful.”



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publication of a sale postponement notice was not required by

HRS § 667-5(d)8 or the mortgage;9 and (3) Rosen is not liable to

Hungate because Rosen did not owe a duty of care to Hungate, a

non-client.

            On November 5, 2013, the circuit court granted Rosen’s

motion to dismiss.10     The court ruled that (1) Rosen complied

with HRS §§ 667-5 and 667-7 as a matter of law; (2) HRS § 667-

5(d) and the power of sale clause of the mortgage did not

require publication of the postponement of the non-judicial

foreclosure sale; (3) Hungate lacked standing to assert claims

under HRS chapter 480; and (4) Hungate’s common law claims were

foreclosed because Rosen did not owe a duty to Hungate.

            On December 19, 2013, Hungate filed his first amended

complaint against Rosen and Deutsche Bank.          The claims were

nearly identical to those alleged in the initial complaint.11



      8
            HRS § 667-5(d)(Supp. 2008) states in relevant part as follows:
“Any sale, of which notice has been given . . . may be postponed from time to
time by public announcement made by the mortgagee or by a person acting on
the mortgagee’s behalf.”
     9
            Rosen noted that the notice of mortgagee’s intention to foreclose
under power of sale stated that “[t]his sale may be postponed from time to
time by public announcement made by Mortgagee or someone acting on
Mortgagee’s behalf.” (Emphasis omitted).
     10
            The Honorable Rhonda A. Nishimura presided.
      11
            In addition to the claims raised in the initial complaint,
Hungate alleged that Deutsche Bank’s practice of granting quitclaim deeds,
rather than limited warranty deeds, was an unfair and deceptive trade
practice. This claim is not an issue before the court.



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            Deutsche Bank filed a motion to dismiss the first

amended complaint, making arguments similar to those presented

by Rosen.

            On April 8, 2014, the circuit court granted in part12

Deutsche Bank’s motion to dismiss Hungate’s first amended

complaint.    As with its prior dismissal of Hungate’s August 6,

2013 complaint, the court ruled that (1) Deutsche Bank complied

with the notice requirement under HRS §§ 667-5 and 667-7 as a

matter of law, and (2) HRS § 667-5(d) and the power of sale

clause did not require that postponements of sale be published.

            After appealing to the Intermediate Court of Appeals,

the parties filed applications for transfer that were

subsequently granted by this court.

                          II.   Standards of Review

A.   Motion to Dismiss

            The circuit court’s grant of a motion to dismiss is

reviewed de novo.     Kamaka v. Goodsill Anderson Quinn & Stifel,

117 Hawaii 92, 104, 176 P.3d 91, 103 (2008), as amended (Jan.

25, 2008).    Further, the appellate court must accept the

allegations made in the complaint as true and “view them in the


     12
            The circuit court stayed Hungate’s claim regarding Deutsche
Bank’s use of quitclaim deeds pending the appeals in Lima v. Deutsche Bank
National Trust Co., No. 13-16091 (9th Cir. filed May 30, 2013); Gibo v.
United States Bank National Ass’n, No. 13-16092 (9th Cir. filed May 30,
2013); and Bald v. Wells Fargo Bank, N.A., No. 13-16622 (9th Cir. filed Aug.
12, 2013), which raised the same or similar issues.


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light most favorable to the plaintiff[s]; dismissal is proper

only if it ‘appears beyond doubt that the plaintiff[s] can prove

no set of facts in support of [their] claim[s] that would

entitle [them] to relief.’”       Wong v. Cayetano, 111 Hawaii 462,

476, 143 P.3d 1, 15 (2006)(citations omitted).           “However, in

weighing the allegations of the complaint as against a motion to

dismiss, the court is not required to accept conclusory

allegations on the legal effect of the events alleged.”             Pavsek

v. Sandvold, 127 Hawaii 390, 403, 279 P.3d 55, 68 (App. 2012)

(citation omitted).

B.   Statutory Interpretation

           Statutory interpretation is reviewable de novo.

Citizens Against Reckless Dev. v. Zoning Bd. of Appeals, 114

Hawaii 184, 193, 159 P.3d 143, 152 (2007).          When construing

statutes, the court is governed by the following rules:

                 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.

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

C.   Interpretation of Contracts

           “[T]he construction and legal effect to be given a

contract is a question of law freely reviewable by an appellate

court.”   Hawaiian Ass’n of Seventh-Day Adventists v. Wong, 130

Hawaii 36, 45, 305 P.3d 452, 461 (2013)(citation omitted).

                               III. Discussion

           Taking the facts alleged in Hungate’s complaints as

true, the circuit court improperly dismissed Hungate’s initial

complaint and first amended complaint.          In reaching this

conclusion, we assess Hungate’s claims against Deutsche Bank and

Rosen, respectively.

           In Part A, we hold the circuit court erred in

dismissing the majority of Hungate’s claims against Deutsche

Bank regarding the alleged HRS chapter 667 Part I violations.

Additionally, we conclude the mortgage’s power of sale clause

required Deutsche Bank to publish all postponements of the

foreclosure sale.     Regarding Hungate’s HRS chapter 667 Part I

claims against Rosen, we conclude that the statute required

Rosen (1) to give proper notice of the sale date under former

HRS § 667-7 and (2) to give notice of the postponements of the

sale in accordance with the mortgage’s power of sale clause per

former HRS § 667-5.      However, we hold that those statutory


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provisions do not create a private right of action against the

attorney of a foreclosing mortgagee.         We conclude Hungate does

not have a cause of action against Rosen under former HRS § 667-

5 and his claims against Rosen based upon the mortgage’s power

of sale clause cannot stand.

           In Part B, we determine that Deutsche Bank had a

common law duty to Hungate to use reasonable means to obtain the

best price for Hungate’s property.         In Part C we hold that the

circuit court erred in dismissing Hungate’s unfair or deceptive

acts or practices claim against Deutsche Bank, but properly

dismissed Hungate’s UDAP claim against Rosen.

A.   The Circuit Court Erred in Dismissing the Majority of
     Hungate’s Claims Alleging HRS Chapter 667 Part I Violations
     against Deutsche Bank

           Hungate alleges that Deutsche Bank and Rosen

improperly conducted the foreclosure sale of Hungate’s property.

Specifically, Hungate contends Rosen and Deutsche Bank: (1)

advertised a foreclosure date earlier than permitted under HRS

§ 667 Part I; (2) failed to publish the notices of postponements

of the sale as was required by the power of sale clause; and (3)

improperly permitted a non-attorney to prepare and sign the

notice of sale.

           We hold that the circuit court erred in dismissing

Hungate’s complaints against Deutsche Bank on the basis of the

first two allegations.      As to the third allegation, former HRS

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§ 667-5 does not require a Hawaii-licensed attorney to prepare

and sign a notice of sale, and we affirm in part the circuit

court’s April 8, 2014 order dismissing Hungate’s first amended

complaint.

           Regarding the allegations against Rosen, we conclude

that Hungate does not have a cause of action against Rosen for

violating statutory requirements under HRS chapter 667, or for

his failure to adhere to the requirements of the mortgage’s

power of sale clause.

     1. HRS § 1-29 Governs the Scheduling of a Foreclosure Sale
        Under Former HRS § 667 Part I13

           Former HRS § 667-7(a)(2) required that “[t]he notice

of intention of foreclosure shall contain: . . . A statement of

the time and place proposed for the sale [of the mortgaged

property] at any time after the expiration of four weeks from

the date when first advertised.”          (Emphasis added).    Thus,




     13
       The events at issue here occurred between 2007 and 2009. In the wake
     of the mortgage crisis, the legislature formed a Mortgage Foreclosure
     Task Force in 2010. See 2010 Haw. Sess. Laws, Act 162, § 2, at 375.
     The Task Force recommended extensive changes to the Hawaiʿi foreclosure
     statute in reports to the legislature in December 2010 and December
     2011, and many of those changes were subsequently enacted by the
     legislature in the 2011 and 2012 legislative sessions. See generally
     Final Report of the Mortgage Foreclosure Task Force to the Legislature
     for the Regular Session of 2012 (December 2011); see also 2011 Haw.
     Sess. Laws, Act 48 at 84; 2012 Haw. Sess. Laws, Act 182, at 630. Among
     other things, those revisions imposed UDAP liability on foreclosing
     mortgagees for a series of specific violations of the statutory
     procedures which now govern nonjudicial foreclosure. HRS § 667-60
     (2016).



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whether the advertised sale date on April 17, 2009 was “after

the expiration of four weeks” is the crux of this issue.

           Hungate contends that HRS § 1-29 is the proper method

to calculate whether Deutsche Bank and Rosen complied with HRS

§ 667-7.   HRS § 1-29 (2009) provides that time periods are

calculated “by excluding the first day and including the

last[.]”   Under Hungate’s analysis, Deutsche Bank and Rosen

advertised a foreclosure sale date that was exactly 28 days from

the date the notice was published, and therefore the sale was

not scheduled “after the expiration of four weeks.”

           Deutsche Bank and Rosen argue that we should apply the

time computation rule set forth in Silva v. Lopez, which

required that we “include the day of the first publication and

exclude the day the act is advertised to be done.”            Silva, 5

Haw. 262, 270 (Haw. Kingdom 1884).         The time computation rule of

Silva indicates that Deutsche Bank and Rosen advertised a sale

date in compliance with the four-week requirement.

           We hold that HRS § 1-29 is the appropriate computation

rule.   In 1923, the Hawaii legislature passed Act 3, the

predecessor to HRS § 1-29, which set forth a time computation

rule that is substantially the same as HRS § 1-29.            1923 Haw.

Sess. Laws Act 3, § 1 at 2.       To explain the necessity of Act 3,

the chair of the House Judiciary Committee noted that “under our

existing statutes no definition is given nor method supplied in

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the computation of time for the performance or completion of an

Act under contract or legal requirement[.]”           H. Stand. Comm.

Rep. No. 9, in 1923 House Journal, at 97.          Due to the absence of

a time computation provision, he explained that “numerous

interpretations [of time computation] based principally on the

decisions of other courts and jurisdictions” resulted.             Id.

Silva is one such case that used the decisions of other courts

to determine a time computation rule.         Specifically, the Silva

court cited a New Hampshire case in deciding that the day an act

occurred was included in computing time.          Silva, 5 Haw. at 262.

By passing Act 3, which became HRS § 1-29, the Hawaii

legislature outlined the procedure by which we now calculate

time.   Thus, HRS § 1-29 sets forth the computation rule to be

used when calculating the scheduling of foreclosure sales

pursuant to HRS § 667 Part I.

           HRS § 1-29 mandates that the earliest date for the

sale of Hungate’s property was April 18, 2009, and thus Deutsche

Bank did not give the requisite amount of notice.            HRS § 1-29

states that “[t]he time in which any act provided by law is to

be done is computed by excluding the first day and including the

last[.]”   Combined with the “after the expiration of four weeks”

language from HRS § 667-7(a)(2), HRS § 1-29 requires that March

20, 2009, the date Deutsche Bank and Rosen first published the

notice of sale, be excluded from the notice calculation as it

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was “the first day.”      Counting four weeks—28 days—from March

21, 2009, results in the earliest possible sale date falling on

April 18, 2009.     Accordingly, the circuit court erred in

determining that a sale date of April 17, 2009 complied with the

requirements of HRS § 667-7.

     2. The Power of Sale Clause Required Deutsche Bank to
        Publish Postponements of the Foreclosure Sale

           Hungate argues that Deutsche Bank and Rosen were

required to publish all postponements of the April 17, 2009 sale

date for two reasons: (1) the original sale date advertised in

the notice was one day early and thus notice was not properly

given, and (2) the power of sale clause of Hungate’s mortgage

required publication of postponements of the foreclosure sale.

           Deutsche Bank and Rosen contend the power of sale

clause cannot require publication of postponements because

former HRS § 667-5(d)(Supp. 2008) allows for sales to be

postponed “from time to time by public announcement[.]”             This

section presupposes, however, that “notice has been given” in

accordance with HRS § 667-7(a)(2).14        Former HRS § 667-5(d).         As

noted supra, Deutsche Bank did not comply with the time

computation required by HRS § 667-7(a)(2) and thus did not, as


      14
            Because former HRS §§ 667-5 and 667-7 are in pari materia,
inasmuch as they both discuss the notice of intention of foreclosure, we read
the two statutes together. See HRS § 1-16 (2009) (“Laws in pari materia, or
upon the same subject matter, shall be construed with reference to each
other.”).


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required by HRS § 667-5(d), give proper notice.           Therefore,

Deutsche Bank cannot avail itself of the public announcement

postponement method in HRS § 667-5(d).

           Even assuming Deutsche Bank provided timely notice of

the date of sale by public announcement, Hungate contends

Deutsche Bank was required—pursuant to former HRS § 667-

5(a)(2)—to publish all postponements of the foreclosure sale in

compliance with the mortgage’s power of sale clause.            HRS § 667-

5(a)(2) states that the attorney shall “[g]ive any notices and

do all acts as are authorized or required by the power [of sale]

contained in the mortgage.”       (Emphasis added).      Thus, if the

mortgage’s power of sale clause requires more than what is

required under HRS § 667 Part I, the mortgagee must follow the

requirements of the power of sale clause.          The relevant portion

of the power of sale clause of Hungate’s mortgage states: “If

Lender invokes the power of sale, . . . Lender shall publish a

notice of sale and shall sell the Property at the time and place

and under the terms specified in the notice of sale.”             (Emphases

added).   Under Hungate’s interpretation of the clause, any

change in the time, place, or terms specified in the notice of

sale, which includes the date, time, and place of the sale,

requires the lender to publish a new notice of sale with the new

terms.



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           In contrast to Hungate’s position, Deutsche Bank and

Rosen interpret the power of sale clause to allow postponement

by public announcement because the notice of sale expressly

permits oral postponement.       The power of sale clause states that

the mortgagee “shall sell the Property at the time and place and

under the terms specified in the notice of sale.”            (Emphasis

added).   Because the notice of sale expressly states that the

sale “may be postponed from time to time by public announcement

made by Mortgagee or someone acting on Mortgagee’s behalf,”

Deutsche Bank and Rosen assert that oral postponement complied

with the “terms specified in the notice of sale.”            According to

Deutsche Bank’s and Rosen’s analysis of the power of sale

clause, only a single notice must be published, and not “a

notice of sale for each postponed date.”          (Emphasis added)

(citing Lima v. Deutsche Bank Nat’l Trust Co., 943 F. Supp. 2d

1093, 1101 (D. Haw. 2013)).       Thus, under Deutsche Bank’s and

Rosen’s interpretation of the power of sale clause, once a

notice of sale is published, the power of sale is complied with

as long as future postponements are publicly announced orally at

the time of the scheduled sale.

           Because there are two reasonable interpretations of

the power of sale clause, an ambiguity exists as to whether a

new notice must be published to postpone the foreclosure sale.

See Wong, 130 Hawaii at 45, 305 P.3d at 461 (explaining a

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contract is ambiguous “when its terms are reasonably susceptible

to more than one meaning”).       The application of contract

interpretation principles to resolve the power of sale clause’s

ambiguity supports the conclusion that Deutsche Bank was

required to publish postponement notices.          “[A]ny ambiguity in a

mortgage instrument should be construed against the party

drawing the documents,” State Sav. & Loan Ass’n v. Kauaian Dev.

Co., 62 Haw. 188, 198, 613 P.2d 1315, 1322 (1980), or in other

words, “against the party who supplies the words[.]”

Restatement (Second) of Contracts § 206 (Am. Law Inst. 1981).

The ambiguity in the power of sale clause should thus be

resolved against Deutsche Bank, as the party who supplied the

words of the contract.      Thus, the more stringent interpretation,

which requires postponements of the sale be published through a

new notice, prevails.      Accordingly, the circuit court should not

have dismissed Hungate’s complaints based on its reasoning that

Deutsche Bank was not required to publish all postponements of

the foreclosure sale.

     3. A Hawaii-licensed Attorney Is Not Required to Prepare or
        Sign a Notice of the Mortgagee’s Intention to Foreclose

           Former HRS § 667-5 (Supp. 2008) requires a mortgagee

foreclosing under a power of sale “be represented by an attorney

who is licensed to practice law in the State and is physically

located in the State.”      HRS § 667-5(a).      The attorney must


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“[g]ive notice of the mortgagee’s . . . intention to foreclose

the mortgage and of the sale . . . by publication” and “[g]ive

any notices and do all acts as are authorized or required by the

power contained in the mortgage.”         HRS § 667-5(a)(1)-(2).

Hungate contends that Deutsche Bank did not comply with HRS

§ 667-5 because the notice of sale for Hungate’s property was

not prepared and signed15 by an attorney licensed in Hawaii.16

           The language of former HRS § 667-5 does not require a

Hawaii-licensed attorney to prepare or sign the notice.             Our

“fundamental starting point for statutory interpretation is the

language of [HRS § 667-5] itself.”         Citizens Against Reckless

Dev., 114 Hawaii at 193, 159 P.3d at 152.          HRS § 667-5 only

requires an attorney to “give notice” and “do all acts as are

authorized or required” by the power of sale.           HRS § 667-

5(a)(1)-(2).    Neither of these requirements involves the

preparation and signing of a notice.         The language of the

statute itself thus does not provide that a Hawaii-licensed

attorney is required to prepare or sign a notice.



     15
            Hungate also uses the terminology that a non-attorney “published”
the notice. But, as Deutsche Bank notes, Hungate stated in his opening brief
in CAAP-13-0005234 that “Rosen caused to be published [the notice of sale] in
the Kauai publication The Garden Island.”
      16
            Deutsche Bank argues that Hungate waived this issue because it
was not properly raised at trial. Hungate explains that this issue was
raised in his memorandum in opposition to the motion to dismiss. Assuming
arguendo that this claim was not waived, this claim is nonetheless meritless.


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           Additionally, the legislative history of HRS § 667-5

does not evince the intent that a Hawaii-licensed attorney

prepare or sign a notice of the mortgagee’s intention to

foreclose.    The legislature’s purpose in enacting HRS § 667-5

was to ensure that where a power of sale clause is included in

the mortgage, interested parties be able to request and timely

receive information.      See Conf. Comm. Rep. No. 3-08, in 2008

House Journal, at 1710, 2008 Senate Journal, at 793; S. Stand.

Comm. Rep. No. 2108, in 2008 Senate Journal, at 917.            To

accomplish this, the legislature required a mortgagee to hire a

Hawaii-licensed attorney, who is physically present in the

state, to serve as a “contact individual” in order to facilitate

the providing of information.        S. Stand. Comm. Rep. No. 2108, in

2008 Senate Journal, at 917.       A Hawaii-licensed attorney must

therefore serve as a contact individual and provide notice of a

mortgagee’s intent to foreclose on a property—but the

legislative history contains no indication of legislative intent

that the attorney prepare or sign a notice of the mortgagee’s

intention to foreclose.

           Accordingly, the circuit court properly dismissed

Hungate’s first amended complaint as to his claim that a non-

attorney prepared and signed the notice of sale.




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      4. Former HRS §§ 667-5 and 667-7 Create No Private Right of
         Action Against a Foreclosing Mortgagee’s Attorney

           Hungate contends Rosen owed statutory duties under HRS

§§ 667-5 and 667-7.     In response, Rosen argues former HRS § 667-5

fails to involve the kind of “special relationship” between

Hungate and Rosen necessary for an attorney to owe a duty to a

non-client.    Generally, a duty imposed on an attorney in favor

of an adversary of the attorney’s client poses an “unacceptable

conflict of interest.”      Buscher v. Boning, 114 Hawaiʻi 202, 220,

159 P.3d 814, 832 (2007).       For that reason, absent special

circumstances, attorneys owe no duty of care to non-clients. See

id.   The question raised here is whether the requirements of

former HRS § 667-5 and former HRS § 667-7 impose duties that may

be enforced against the attorney of a foreclosing mortgagee

under a private right of action.

           Requirements imposed by statutes do not necessarily

give rise to a private right of action. Cannon v. University of

Chicago, 441 U.S. 677, 688 (1979)(noting that the fact that a

“statute has been violated and some person harmed does not

automatically give rise to a private cause of action in favor of

that person”).     In considering whether a duty imposed by statute

creates a private right of action, our court has consistently

focused on the intent of the legislature.          Whitey’s Boat

Cruises, Inc. v. Napali-Kauai Boat Charters, Inc., 110 Hawaiʻi


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302, 312, 132 P.3d 1213, 1223 (2006).          We review such questions

de novo as a matter of law.       Namauu v. City & Cty. of Honolulu,

62 Haw. 358, 362, 614 P.2d 943, 946 (1980)(noting that “the

nature and extent of duty imposed by statute is a matter of

law”).

           The language of former HRS § 667-5, as amended in

2008, indicates the legislature intended attorneys to provide

notice of the mortgagee’s intention to foreclose and notice of

the sale of the mortgaged property; the language also shows the

legislature intended attorneys to comply with the power of sale

clause in the mortgage.       Former HRS § 667-5(a) explicitly states

that “[t]he attorney shall[] . . . [g]ive notice of the

mortgagee’s . . . intention to foreclose the mortgage and of the

sale of the mortgaged property.”          (Emphasis added).    In

addition, the attorney “shall . . . do all acts as are

authorized or required by the power contained in the mortgage,”

such as complying with the power of sale clause of the mortgage.

Former HRS § 667-5(a)(2) (emphasis added).          An attorney thus is

required under the statute to give proper notice and to perform

all acts authorized or required by the power of sale clause.17

Although Rosen failed to follow some requirements of former HRS


     17
            Former HRS § 667-5(d), however, permits the mortgagee or “some
person acting on the mortgagee’s behalf”—not necessarily an attorney—to
postpone the sale by public announcement.



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§ 667-5, we hold that the statute did not create a cause of

action against attorneys who fail to follow its requirements.

            In determining whether a private cause of action

should be recognized based on statutory requirements, we

consider the following factors: (1) whether the plaintiff is

“one of the class for whose especial benefit the statute was

enacted”; (2) whether there is “any indication of legislative

intent, explicit or implicit, either to create such a remedy or

to deny one”; and (3) whether a private cause of action would be

“consistent with the underlying purposes of the legislative

scheme to imply such a remedy for the plaintiff.”            Whitey’s Boat

Cruises, 110 Hawaiʻi at 312, 132 P.3d at 1223.           While each factor

is relevant, “the key factor” is whether the legislature

“intended to provide the plaintiff with a private right of

action.”    Id. at 313 n.20, 132 P.3d at 1224 n.20; see also

Touche Ross & Co. v. Redington, 442 U.S. 560, 575 (noting that

the three factors used to assess whether a private cause of

action may be implied from statutory language ultimately “are

ones traditionally relied upon in determining legislative

intent”).

            We first consider whether Hungate was a member of the

class for whose special benefit the statute was enacted.             As

discussed supra, the statute was amended to benefit the “party

in breach of the mortgage agreement.”         H. Stand. Comm. Rep. No.

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1192, in 2008 House Journal, at 1450.            As the party in breach of

the mortgage contract, Hungate falls within the class for whom

the statute was enacted.

               The second factor considers whether there is “any

indication of legislative intent, explicit or implicit, either

to create such a remedy or to deny one.”             Whitey’s Boat Cruises,

Inc., 110 Hawaiʻi at 312, 132 P.3d at 1223.             Former HRS § 667-5

and its legislative history are silent as to whether the

legislature intended to create a cause of action on behalf of

the mortgagor against the mortgagee’s lawyer.18              “[I]mplying a

private right of action on the basis of [legislative] silence is

a hazardous enterprise, at best.”            Touche Ross & Co, 442 U.S. at

571.    Nonetheless, legislative silence alone is not dispositive.

See 1A C.J.S. Actions § 62 (2016)(when a statute is silent, a

court may infer a statutory private right of action where there

is strong evidence that “the statutory scheme” implies it).

               We turn, then, to the third factor, whether a private

cause of action would be consistent with “the underlying

purposes of the legislative scheme.”            Whitey’s Boat Cruises,

Inc., 110 Hawaiʻi at 312, 132 P.3d at 1223. Here, amendments to

the foreclosure process set forth in HRS chapter 667 Part I were

intended to “expand[] the rights of mortgagors.”               Kondaur

       18
               HRS § 667-4 (1993) does provide the mortgagor may defend against
foreclosure.


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Capital Corp. v. Matsuyoshi, 136 Hawaiʻi 227, 239, 361 P.3d 454,

466 (2015) (explaining that amendments to former HRS § 667-5

“added requirements that mortgagees must fulfill in order to

accomplish a valid foreclosure sale” resulting in a benefit to

mortgagors by “expand[ing] and bolster[ing] the protections to

which they are entitled”).

           However, a close reading of the legislative history of

the 2008 amendment shows it was enacted to set additional

burdens on the mortgagee to protect the mortgagor; the statute

was not amended to regulate attorneys representing mortgagees.

The amendment’s structure or scheme attempted “to streamline and

ensure transparency in the non-judicial foreclosure process by

requiring a foreclosure mortgagee to provide pertinent

information regarding the property to interested parties.”              S.

Stand. Comm. Rep. No. 2108, in 2008 Senate Journal, at 917

(emphasis added).

           The committee reports explain that potential buyers

and other interested parties faced difficulties in obtaining

updated information regarding foreclosure sales from banks and

entities located outside of Hawaiʻi: “A large number of Hawaii

foreclosures are handled by servicing corporations located on

the mainland that provide little to no information relating to

the foreclosure to parties that are entitled to information

regarding the property to be foreclosed.”          Conf. Comm. Rep. No.

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3-08, in 2008 House Journal, at 1710, 2008 Senate Journal, at

793.   Due to the growing concern that mortgagees were creating

obstacles for parties seeking information, the legislature

required a mortgagee to hire a Hawaiʻi-licensed attorney, who is

physically present in the state, to serve as a “contact

individual.”    S. Stand. Comm. Rep. No. 2108, in 2008 Senate

Journal, at 917.     The legislature concluded that a “Hawaii-based

attorney will ensure that interested parties have a means to

obtain information from a person with a local presence and the

ability to provide useful information.”          Conf. Comm. Rep. No. 3-

08, in 2008 House Journal, at 1710, 2008 Senate Journal, at 793.

Thus, the underlying structure and intent of the amendment was

to enable interested parties to request and receive information

in a timely manner from mortgagees, and not to regulate

attorneys’ conduct.      Permitting a mortgagor to assert a claim

against the foreclosing mortgagee’s attorney for failure to

comply with former HRS § 667-5 falls outside this statutory

scheme.

           We also consider the further factor of whether

“additional remedies are unnecessary” when determining whether

to recognize a new cause of action.         Best Place, Inc. v. Penn

America Ins. Co., 82 Hawaiʿi 120, 126, 920 P.2d 334, 340 (1996).

In this case, creating a cause of action under former HRS § 667-

5 is not necessary to protect the interests of the mortgagor.

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Rather, the mortgagor can protect its interests through filing a

claim against the mortgagee for wrongful foreclosure.             See

Santiago v. Tanaka, 137 Hawaiʿi 137, 158-59, 366 P.3d 612, 633-

34 (2016) (holding the nonjudicial foreclosure was wrongful and

awarding restitution to mortgagor).          When voiding the

foreclosure is not possible, the mortgagor is entitled to

“restitution of their proven out-of-pocket losses” through a

wrongful foreclosure claim.       Id. at 158, 366 P.3d at 633.

Because mortgagees could be required to provide restitution to

injured mortgagors under a wrongful foreclosure claim, a

“sufficient incentive” exists for mortgagees to ensure that the

foreclosure proceedings are correctly performed by attorneys.

Best Place, Inc., 82 Hawaiʿi at 127, 920 P.2d at 341.             The

interests of the mortgagor are thus protected.

           In sum, we conclude that recognizing a cause of action

based upon former HRS § 667-5 is not warranted.           Because former

HRS §§ 667-5 and 667-7 are in pari materia, inasmuch as they

both discuss the notice of intention of foreclosure, we read the

two statutes together.      See HRS § 1-16 (2009) (“Laws in pari

materia, or upon the same subject matter, shall be construed

with reference to each other.”).          Accordingly, for the same

reasons Hungate cannot assert a cause of action against Rosen

under HRS § 667-5, he cannot assert a claim under HRS § 667-7.

           Hungate also makes a contract-based argument that

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Rosen was required to adhere to the mortgage’s power of sale

clause because former HRS § 667-5(a)(2) states that the attorney

shall “[g]ive any notices and do all acts as are authorized or

required by the power [of sale] contained in the mortgage.”

However, Hungate’s ability to make this contract-based claim

ultimately relies upon the availability of a cause of action

under former HRS § 667-5.       As discussed supra, Hungate cannot

assert a viable cause of action against Rosen under HRS § 667-5;

thus, his contract-based claim does not stand.

B.   Deutsche Bank Must Use Reasonable Means to Obtain the Best
     Price for a Foreclosed Property

           In addition to Hungate’s allegations that Deutsche

Bank and Rosen violated HRS § 667 Part I and the mortgage

contract, Hungate asserts that Deutsche Bank violated common law

duties established in Silva and Ulrich v. Sec. Inv. Co., 35 Haw.

158 (Haw. Terr. 1939).      Quoting Ulrich, Hungate contends that

failing to give proper notice under former HRS § 667-7(a)(2) and

failing to publish postponement announcements as required by the

mortgage’s power of sale clause constituted violations of the

common law duty to “use all fair and reasonable means in

obtaining the best prices for the property on sale[.]”             Ulrich,

35 Haw. at 168.     We agree.    In reaching this conclusion, we

first discuss the duty owed by mortgagees under Ulrich.             We then

address the burden of the mortgagee who purchases the foreclosed


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property to demonstrate that the foreclosure sale was “regularly

and fairly conducted” and that “an adequate price” was paid by

the mortgagee.     Ulrich, 35 Haw. at 168.

     1. Deutsche Bank Owes a Common Law Duty to Hungate

           We recently reaffirmed Ulrich and recognized that this

common law duty extends to mortgagees conducting non-judicial

foreclosure sales of real property.         See Kondaur Capital Corp.

v. Matsuyoshi, 136 Hawaiʿi 227, 361 P.3d 454 (2015).            At the

time Ulrich was decided, the law did not distinguish between

real property and chattel mortgages;19 accordingly, the court did

not limit Ulrich’s holding to chattel mortgages.            See RLH §


     19
            The statutory provisions governing non-judicial foreclosures when
Ulrich was decided were Revised Laws of Hawaii (RLH) §§ 4724-4728 (1935).
Ulrich, 35 Haw. at 163. RLH § 4724, the former version of HRS § 667-5,
provided as follows:

           Notice of foreclosure; affidavit after sale. When a power
           of sale is contained in a mortgage, the mortgagee, or any
           person having his estate therein, or authorized by such
           power to act in the premises, may, upon a breach of the
           condition, give notice of his intention to foreclose the
           mortgage, by publication of such notice in the English
           language once in each of three successive weeks, the first
           publication to be not less than twenty-eight days before
           the day of sale, and the last publication to be not less
           than fourteen days before the day of sale, in a newspaper
           published either in the county in which the mortgaged
           property lies, or in Honolulu, and having a circulation in
           such county; and also give such notices and do all such
           acts as are authorized or required by the power contained
           in the mortgage.      He shall, within thirty days after
           selling the property in pursuance of the power, file a copy
           of the notice of sale and his affidavit, setting forth his
           acts in the premises fully and particularly, in the bureau
           of conveyances, in Honolulu. The affidavit and copy of the
           notice shall be recorded by the registrar, with a notice of
           reference thereto in the margin of the record of the
           mortgage deed, if recorded in his office.



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4724; Kondaur, 136 Hawaiʿi at 240, 361 P.3d at 467 (analyzing

RLH § 4727); Ulrich, 35 Haw. at 163-68.          In Kondaur, we

explained that Ulrich’s rationale, to protect the mortgagor from

being “wrongfully and unfairly taken advantage of by the

mortgagee,” applies with equal force to non-judicial foreclosure

sales of real property.      Kondaur, 136 Hawaiʿi at 240, 361 P.3d

at 467.   Mortgagors of both real and personal property therefore

continue to benefit from the protections set forth in Ulrich.

Id. at 240, 361 P.3d at 467.       Accordingly, under Kondaur and

Ulrich, in addition to the duties required under the now-

repealed HRS § 667 Part I, a mortgagee has a duty to use “fair

and reasonable means in obtaining the best prices for the

property on sale.”     Id. at 235, 361 P.3d at 462 (citing Ulrich,

35 Haw. at 168); see also Silva, 5 Haw. at 265 (requiring the

mortgagee “to use discretion in an intelligent and reasonable

manner, not to oppress the debtor or to sacrifice his estate”).

           We further clarify that the mortgagee’s duty to seek

the best price under the circumstances does not require the

mortgagee to obtain the fair market value of the property.

Indeed, “[m]any commentators have observed that the foreclosure

process commonly fails to produce the fair market value for

foreclosed real estate.”       Restatement (Third) of Prop.:

Mortgages § 8.3 cmt. a (Am. Law Inst. 1997).           There are several

reasons why foreclosure sales fail to attract fair market value

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bids, such as the difficulty in inspecting the subject

properties, technical publication notices, marketable title

concerns, and the lack of a willing seller.           Id.; see also First

Bank v. Fischer & Frichtel, Inc., 364 S.W.3d 216, 226 (Mo. 2012)

(en banc) (Teitelman, C.J., dissenting) (stating “‘it is well

known that property, when sold at a forced sale, usually does

not bring its full value’ and, instead, ‘has the potential of

bringing only a fraction of the fair market value’” (citations

omitted)).    While final bids on foreclosed property need not

equate to fair market values, the mortgagee nonetheless has a

duty to use fair and reasonable means to conduct the foreclosure

sale in a manner that is conducive to obtaining the best price

under the circumstances.

     2. Deutsche Bank Carries the Additional Burden to
        Demonstrate a Regular and Fair Sale and an Adequate Sale
        Price

             In addition to the duty of a mortgagee to use fair and

reasonable means to obtain the best price for the property, a

mortgagee who purchases the foreclosed property has the burden

to show that the sale was “regularly and fairly conducted” and

that “an adequate price” was paid under the circumstances.

Ulrich, 35 Haw. at 168; see also Kondaur, 136 Hawaiʿi at 241-42,

361 P.3d at 468-69.      As we explained in Kondaur, “[i]n instances

where the mortgagee assumes the role of a purchaser in a self-

dealing transaction, the burden is on the mortgagee . . . to

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establish its compliance with these obligations.”            Id. at 240,

361 P.3d at 467.     This burden properly falls on the mortgagee

because in choosing to conduct the non-judicial foreclosure sale

under HRS § 667 Part I, the mortgagee elects a position superior

to the mortgagor with a duty to treat the mortgagor fairly and

without resorting to the advantage derived from its authority to

conduct the sale.

           There is no neutral party, such as a court,

supervising the sale and ensuring a fair and reasonable process.

When the non-judicial foreclosure sale results in the mortgagee

purchasing the property, it is therefore imperative that the

mortgagee establish that this result occurred after a fairly

conducted sale.     Id. at 241-43, 361 P.3d at 468-70.

Accordingly, because Deutsche Bank purchased Hungate’s property,

Deutsche Bank has the burden to establish that the sale was

fairly conducted and resulted in an adequate price under the

circumstances.     Id. at 240-42, 361 P.3d at 467-69.

C.   The Circuit Court Erred in Dismissing Hungate’s Unfair or
     Deceptive Acts or Practices Claim Against Deutsche Bank,
     but Properly Dismissed Hungate’s Claim Against Rosen

           Hungate alleged that Deutsche Bank and Rosen committed

unfair or deceptive acts or practices, in violation of HRS




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§ 480-2,20 by providing less than the statutorily required four

weeks of notice and failing to publish the notice of sale.              HRS

§ 480-2(a) provides that “unfair or deceptive acts or practices

in the conduct of any trade or commerce are unlawful.”

           HRS § 480-2 contains “broad language in order to

constitute a flexible tool to stop and prevent fraudulent,

unfair or deceptive business practices for the protection of

both consumers and honest business[persons].”           Haw. Cmty. Fed.

Credit Union v. Keka, 94 Hawaiʿi 213, 228, 11 P.3d 1, 16 (2000)

(quoting Ai v. Frank Huff Agency, Ltd., 61 Haw. 607, 616, 607

P.2d 1304, 1311 (1980), overruled on other grounds by Robert’s

Haw. Sch. Bus, Inc. v. Laupahoehoe Transp. Co., 91 Hawaiʿi 224,

247, 982 P.2d 853, 876 (1999)).        “HRS chapter 480’s paramount

purpose was to ‘encourage those who have been victimized by

persons engaging in unfair or deceptive acts or practices to

prosecute their claim’ thereby affording ‘an additional

deterrent to those who would practice unfair and deceptive

business acts.’”     Zanakis-Pico v. Cutter Dodge, Inc., 98 Hawaiʿi

309, 317, 47 P.3d 1222, 1230 (2002) (citations omitted).             This

statute “is remedial in nature and must be liberally construed

in order to accomplish the purpose for which it was enacted.”

Keka, 94 Hawaiʿi at 229, 11 P.3d at 17; see also Compton v.

     20
            Hungate also alleged an unfair methods of competition claim in
his complaint and first amended complaint, but does not dispute the circuit
court’s dismissal of that claim in his appeal.


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Countrywide Fin. Corp., 761 F.3d 1046, 1052 (9th Cir.

2014)(applying Hawaiʿi law).

            To assert an unfair or deceptive acts or practices

claim pursuant to HRS § 480-2, Hungate must qualify as a

“consumer” and the alleged conduct of Rosen and Deutsche Bank

must involve “trade or commerce.”         We address separately

Hungate’s claims against Deutsche Bank and Rosen for unfair and

deceptive acts or practices.

       1.   Hungate Sufficiently Alleged Deutsche Bank Violated
            HRS § 480-2 by Engaging in Unfair or Deceptive Acts
            or Practices

            As a mortgagor who purchased residential property,

Hungate alleges he qualifies as a consumer under HRS chapter

480.    A consumer is a “natural person who, primarily for

personal, family, or household purposes, purchases, attempts to

purchase, or is solicited to purchase goods or services or who

commits money, property, or services in a personal investment.”

HRS § 480-1 (2008).      “[I]n the context of consumer debt, the

determination of whether the individual seeking suit is a

‘consumer’ should rest on whether the underlying transaction

which gave rise to the obligation” met the requirements of HRS

§ 480-1.    Flores v. Rawlings Co., LLC, 117 Hawaiʿi 153, 164, 177

P.3d 341, 352 (2008).      Here, the underlying transaction involved

committing money in a personal investment pursuant to HRS § 480-

1, namely, purchasing residential property.           See Keka, 94

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Hawaiʿi at 227, 11 P.3d at 15 (citing Cieri v. Leticia Query

Realty, Inc., 80 Hawaiʿi 54, 69, 905 P.2d 29, 44

(1995))(explaining “real estate or residences qualify as

‘personal investments’”).       Further, we have held that an

individual who purchases residential property through acquiring

a loan, i.e., a “loan borrower,” is a “consumer” committing

money in a personal investment within the meaning of HRS § 480-

1.   Keka, 94 Hawaiʿi at 227, 11 P.3d at 15 (citing Cieri, 80

Hawaiʿi at 69, 905 P.2d at 44).        Hungate, as a loan borrower who

purchased residential property, is thus a consumer.

            We also conclude Deutsche Bank’s acts occurred in

trade or commerce.     Trade or commerce means a “business

context.”    Cieri, 80 Hawaiʿi at 65, 905 P.2d at 40.

Transactions conducted in a business context, “by their very

nature, include transactions conducted by a financial

institution,” such as a “loan extended by a financial

institution[.]”     Keka, 94 Hawaiʿi at 227, 11 P.3d at 15.          Thus,

the nature of a non-judicial foreclosure, which results from a

loan transaction, is that of a transaction conducted in the

business context.     It is undisputed that Deutsche Bank is a

financial institution regularly engaged in providing loans and

conducting foreclosures.       Deutsche Bank’s acts throughout the

foreclosure proceedings therefore occurred in the business

context.

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            We next consider whether Hungate alleged sufficient

facts that Deutsche Bank engaged in unfair or deceptive acts.21

“The question of whether a practice constitutes an unfair or

deceptive trade practice is ordinarily a question of fact.”

Balthazar v. Verizon Haw., Inc., 109 Hawaiʿi 69, 72 n.4, 123

P.3d 194, 197 n.4 (2005) (citation omitted).           To determine

sufficiency, we accept the allegations made in Hungate’s

complaints as true and “view them in the light most favorable

to” Hungate.    Cayetano, 111 Hawaiʿi at 476, 143 P.3d at 15.

“[D]ismissal is proper only if it ‘appears beyond doubt that the

plaintiff[s] can prove no set of facts in support of [their]

claim[s] that would entitle [them] to relief.’”           Id. (citation

omitted).

            A practice “is unfair when it [1] offends established

public policy and [2] when the practice is immoral, unethical,

oppressive, unscrupulous or [3] substantially injurious to

consumers.”    Keka, 94 Hawaiʿi at 228, 11 P.3d at 16 (citation

omitted).    Hungate need not allege that Deutsche Bank’s actions

     21
            The circuit court did not reach the merits of Hungate’s unfair or
deceptive acts or practices claim in its dismissals of the initial complaint
and the first amended complaint. In its dismissal of the initial complaint,
the circuit court found that Hungate did not have standing to assert an
unfair or deceptive acts or practices claim against Rosen, and thus did not
reach the merits of Hungate’s claim. In dismissing the first amended
complaint against Deutsche Bank, the court explained that Hungate’s unfair or
deceptive acts or practices claim was based in part on his allegation that
Deutsche Bank failed to comply with the four-week requirement and failed to
publish notice of the postponements of the foreclosure sale. The court
determined that Hungate did not state a claim as to these issues and did not
further address Hungate’s unfair or deceptive acts or practices claim.


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meet all three of these factors to assert an unfair act or

practice.    See id. at 229, 11 P.3d at 17 (determining that the

conduct in question was “unethical, oppressive, unscrupulous and

substantially injurious to consumers,” but not addressing

whether the conduct offended public policy); Kapunakea Partners

v. Equilon Enters. LLC, 679 F. Supp. 2d 1203, 1210 (D. Haw.

2009)(analogizing the three factors as applied to federal

antitrust laws to application of HRS § 480-2 to determine “[a]

practice may be unfair because of the degree to which it meets

one of the criteria or because to a lesser extent it meets all

three” (citation omitted)).

            A practice may be unfair if it “offends public policy

as it has been established by statutes, the common law, or

otherwise[.]”    Kapunakea Partners, 679 F. Supp. 2d at 1210

(citing FTC v. Sperry & Hutchinson, 405 U.S. 233, 244 n.5

(1972)).    Hungate claims Deutsche Bank’s conduct offended public

policy because Rosen’s actions, on behalf of Deutsche Bank,

violated HRS § 667 Part I, as discussed supra.           Deutsche Bank

also bore a common law duty to “use all fair and reasonable

means in obtaining the best prices for the property on sale[.]”

Kondaur, 136 Hawaiʿi at 235, 361 P.3d at 462 (citing Ulrich, 35

Haw. at 168); see also U.S. Bank Nat’l Ass’n v. Castro, 131

Hawaiʿi 28, 39, 313 P.3d 717, 728 (2013)(recognizing that a

purpose of non-judicial foreclosure statutes is to “protect the

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debtor from a wrongful loss of property” (citation omitted));

Hoge v. Kane, 4 Haw. App. 533, 540, 670 P.2d 36, 40 (1983)

(discouraging any action that “prevents a free, fair, and open

[judicial foreclosure] sale or [that] chills the sale”).             A

factfinder could determine Deutsche Bank’s conduct offended

public policy or otherwise met the test for “unfair,” and

therefore Hungate sufficiently alleged that Deutsche Bank

engaged in unfair acts or practices.

           Hungate also alleged that Deutsche Bank conducted the

non-judicial foreclosure deceptively.         A deceptive act or

practice is “(1) a representation, omission, or practice[] that

(2) is likely to mislead consumers acting reasonably under the

circumstances [where] (3)[] the representation, omission, or

practice is material.”      Courbat v. Dahana Ranch, Inc., 111

Hawaiʿi 254, 262, 141 P.3d 427, 435 (2006) (citation omitted).

A representation, omission, or practice is material if it

“involves ‘information that is important to consumers and,

hence, likely to affect their choice of, or conduct regarding, a

product.’”    Id. (citation omitted).       The test to determine

deceptiveness “is an objective one, turning on whether the act

or omission ‘is likely to mislead consumers,’ . . . as to

information ‘important to consumers’ . . . in making a decision

regarding the product or service.”         Id. (citations omitted).



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“[P]roof of actual deception is unnecessary.”           Rosa v. Johnston,

3 Haw. App. 420, 427, 651 P.2d 1228, 1234 (1982).

            The same conduct that Hungate alleges to be unfair may

also be considered to be deceptive.         Hungate contends Rosen’s

practice, on behalf of Deutsche Bank, of conducting foreclosure

sales on the 28th rather than 29th day from the date of first

publication and failing to publish postponements of the sale

date was likely to mislead reasonable consumers and could reduce

buyer interest.     Such practices could render potential buyers

less able to determine whether the property was available for

sale and less able to obtain important information regarding the

property.    As the United States Court of Appeals for the Ninth

Circuit explained, “[p]roper notice of the actual date of a

foreclosure auction is essential to ensure that foreclosed

properties bring adequate prices and that the public has an

appropriate opportunity to bid.”          Kekauoha-Alisa v. Ameriquest

Mortg. Co. (In re Kekauoha-Alisa), 674 F.3d 1083, 1091 (9th Cir.

2012).   Although Kekauoha-Alisa presented a stronger case in

which no public announcement of the sale was provided at all,

the failure to publish the postponement of a foreclosure sale

could mislead consumers.       Thus, a factfinder could determine

Rosen’s scheduling of a foreclosure sale too early and failure

to publish postponement notices, while acting on Deutsche Bank’s

behalf, were deceptive acts.

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            In addition to adequately alleging sufficient facts

that Deutsche Bank’s conduct were unfair or deceptive pursuant

to HRS § 480-2, Hungate was also required to allege sufficient

facts to show he was injured.        See HRS § 480-13.      “[T]he mere

existence of a violation is not sufficient ipso facto to support

the action; forbidden acts cannot be relevant unless they cause

private damage.”     Ai, 61 Haw. at 618, 607 P.2d at 1312

(overruled on other ground by Robert’s, 91 Hawaiʿi at 247, 982

P.2d at 876).    HRS chapter 480 does not define injury or

damages, but “Hawaiʿi courts have not set a high bar for

proving” injury.     Compton, 761 F.3d at 1053.        Hungate need only

allege that “he has, as a ‘direct and proximate result’ of

[Deutsche Bank’s] violation [of section 480-2], ‘sustained

special and general damages’ . . . to withstand a motion to

dismiss.”    Id. at 1054 (citations omitted).         Based on the

allegations in the complaints, the factfinder could determine

Hungate was injured by the foreclosure sale, which eliminated

equity that Hungate held in the property and prevented him from

using the property.

            Accordingly, we hold that Hungate sufficiently alleged

claims of unfair and deceptive acts or practices under HRS

§ 480-2 against Deutsche Bank, and the circuit court erred in

dismissing Hungate’s unfair or deceptive acts or practices claim

against Deutsche Bank.

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     2.   Under the Circumstances, Hungate Cannot Claim Unfair
     or Deceptive Acts or Practices by Rosen

           Hungate also argues that he has standing as a consumer

to assert an unfair or deceptive acts or practices claim against

Rosen.   Rosen maintains that the circuit court properly

dismissed Hungate’s unfair or deceptive acts or practices claim

because Hungate was not a consumer of Rosen’s services.             We

rejected a similar contention in Flores.          In Flores, the

plaintiffs brought an unfair or deceptive acts or practices

claim against a collection agency that provided subrogation and

claims recovery services to the Hawaii Medical Services

Association (HMSA) based on actions conducted in regards to a

loan agreement between plaintiffs and HMSA.           Flores, 117 Hawaiʿi

at 155-57, 177 P.3d at 343-45.        Citing the statute’s definition

of “consumer,” the collection agency argued that the plaintiffs

were not consumers because the plaintiffs did not purchase,

attempt to purchase, or solicit to purchase goods or services

from the agency.     Id. at 163, 177 P.3d at 351; see HRS 480-1.

We disagreed with the agency’s argument, and held that “the

statutory structure of HRS chapter 480 does not require that one

be a ‘consumer’ of the defendant’s goods or services, but merely

a ‘consumer.’”     Id. at 164, 177 P.3d at 352.        A plaintiff

“establishes his standing as a consumer in terms of his

relationship to a transaction, not by a contractual relationship


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with the defendant.”      Id.   Therefore, the “only requirement” is

that the consumer’s commitment of money, property, or services

in a personal investment forms the basis of his complaint.              Id.

at 164-65, 177 P.3d at 352-53.        As Hungate asserts, he is a

consumer based on the mortgage with Deutsche Bank, and is thus

also a “consumer vis-à-vis the mortgagee’s lawyer for the same

transaction.”

           Additionally, Hungate argues that Rosen acted as an

agent for Deutsche Bank in conducting the foreclosure, and thus

should be similarly held liable under the UDAP statute.             Hungate

cites Cieri v. Leticia Query Realty, Inc., 80 Hawaiʿi 54, 65,

905 P.2d 29, 40 (1995), to show that an agent or broker in a

real estate transaction can be sued for UDAP under HRS § 480-2.

However, the unique nature of the attorney-client relationship

warrants distinguishing the role of broker and attorney for

purposes of this case.      Sellers and     purchasers of real estate

often “utilize and rely on brokers for their expertise and

resources, including access to data in locating properties as

well as determining pricing of ‘comparables’ as a basis for

negotiations.”     Cieri, 80 Hawaiʿi at 65, 905 P.2d at 40.          Hence,

the role of a broker is to provide clients with expertise and

resources in real estate transactions.

           In contrast, the role of an attorney involves

representing a client’s interests against those of an opposing

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party within an adversary system.         Attorneys bear a duty to

zealously represent clients “within the bounds of the law.”

Giuliani v. Chuck, 1 Haw. App. 379, 384, 620 P.2d 733, 737

(1980); see also Hawaiʿi Rules of Professional Conduct,

“Preamble,” ¶ 2; ¶ 8; ¶ 9.22       In other settings, we have declined

to recognize a duty in favor of a plaintiff adversely affected

by an attorney’s performance of legal services on behalf of the

opposing party.     In Boning, we noted that “creation of a duty in

favor of an adversary of the attorney’s client would create an

unacceptable conflict of interest.         Not only would the

adversary’s interests interfere with the client’s interests, the

attorney’s justifiable concern with being sued for negligence

would detrimentally interfere with the attorney-client

relationship.”     Boning, 114 Hawaiʿi at 220, 159 P.3d at 832.

           Permitting a party to sue his or her opponent’s

attorney for UDAP under HRS § 480-2 in foreclosure actions

presents a similar issue in that an attorney’s concern with

being sued by a party opponent could compromise his or her

representation of the client.        In a UDAP action, an attorney

would be especially vulnerable to suit because, for example,

under HRS § 480-2 “actual deception need not be shown; the

      22
            Our desire to avoid creating unacceptable conflicts of interest
in this context, to protect attorney-client counsel and advice from the
intrusion of competing concerns, and to allow adequate room for zealous
advocacy, does not encompass, for example, allowing attorneys to conduct
patently illegal activities on behalf of clients.


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capacity to deceive is sufficient.”         Keka, 94 Hawaiʿi at 228, 11

P.3d at 16 (emphasis added) (citations omitted).            Accordingly, a

plaintiff would need only to allege that opposing counsel has

breached the statutory duty under HRS § 480-2 “not to engage in

unfair or deceptive acts or practices in the conduct of any

trade or commerce . . . in a way that caused private damages[]

in order to state a claim under” HRS chapter 480.            Compton, 761

F.3d at 1056.     Given that UDAP lacks a more rigorous or precise

state of mind requirement, “even a carefully rendered opinion

could, if incorrect, have the capacity to deceive.”            Short, 691

P.2d at 172 (Pearson, J., concurring).          The attorney would

therefore “have to insure the correctness of his [or her]

opinions and strategies,” rendering it “virtually impossible for

an attorney to effectively perform the traditional role of legal

counselor.”    Id.   Similar to the negligence issue in Boning, in

foreclosure actions an attorney’s justifiable concern with being

sued by the opposing party for UDAP could compromise the

attorney’s ability to zealously represent his or her client.

Consequently, based on the allegations against Rosen, we decline

to recognize a UDAP claim against him by Hungate under HRS §

480-2 in the instant foreclosure action.23


      23
            We do not now decide whether the 2012 amendments to the
foreclosure statute create potential UDAP liability under some circumstances
for attorneys conducting nonjudicial foreclosures. See HRS § 667-60
(2016)(imposing UDAP liability on “any foreclosing mortgagee” for violating a
                                                             (continued . . .)

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           Accordingly, the circuit court properly dismissed

Hungate’s complaint alleging Rosen violated HRS § 480-2 by

engaging in unfair or deceptive acts or practices.

                               IV.    Conclusion

           For the foregoing reasons, we vacate in part the

circuit court’s November 5, 2013 order granting Rosen’s motion

to dismiss, and vacate in part the circuit court’s April 8, 2014

order granting Deutsche Bank’s motion to dismiss, and remand to

the circuit court for proceedings consistent herewith.


James J. Bickerton,                  /s/ Mark E. Recktenwald
John Francis
Perkin, Stanley K.                   /s/ Paula A. Nakayama
Roehrig
for appellant                        /s/ Sabrina S. McKenna

Christopher T.                       /s/ Richard W. Pollack
Goodin, David B.
Rosen, Peter W.                      /s/ Michael D. Wilson
Olsen
for appellee Rosen

Judy A. Tanaka
for appellee
Deutsche Bank




(. . . continued)
series of provisions governing nonjudicial foreclosure); HRS § 667-1
(2016)(defining “mortgagee” to include “the current mortgagee’s or lender’s
duly authorized agent”).


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