ROGER ROXAS and THE GOLDEN BUDHA CORPORATION, a foreign
corporation, Plaintiffs-Appellees/Cross-Appellants, v. FERDINAND E. MARCOS and IMELDA MARCOS, Defendants-Appellants/Cross-Appellees
The defendant-appellant/cross-appellee Imelda Marcos (Imelda), in her alleged capacity as personal representative of the Estate (the Marcos Estate) of former Philippine President Ferdinand E. Marcos (Ferdinand), appeals from that portion of the amended judgment of the first circuit court entered in favor of the plaintiffs-appellees/cross-appellants the Estate of Rogelio (aka Roger) Domingo Roxas (the Roxas Estate) and the Golden Budha Corporation (GBC) (collectively, the plaintiffs-appellees) and against the Marcos Estate. The plaintiffs-appellees cross-appeal from: (1) that portion of the amended judgment (a) entered in favor of Imelda, in her individual capacity, and against the plaintiffs-appellees and (b) ordering the Marcos Estate to pay damages for conversion in the amount of $22,001,405,000.00; (2) the circuit court's order granting in part and denying in part the plaintiffs-appellees' motion for an award of prejudgment interest; and (3) the circuit court's order granting in part and denying in part the plaintiffs-appellees' motion to alter the judgment.
Imelda argues that the circuit court erred in: (1) amending the judgment to substitute Imelda as the personal representative of the Marcos Estate and entering judgment against her in that capacity; (2) denying Imelda's motions for directed verdict and judgment notwithstanding the verdict, argued on the grounds that (a) the Roxas Estate's claims against the Marcos Estate were barred by (i) the statute of limitations, (ii) the "act of state" doctrine, (iii) the "head of state" doctrine, and (iv) lack of personal jurisdiction, and (b) there was insufficient evidence to support the Roxas Estate's claims for (i) conversion, (ii) false imprisonment, and (iii) damages; (3) failing to give preclusive effect to the opinion of a Philippines trial court regarding the authenticity of the "golden" buddha; and (4) admitting hearsay evidence under the "co-conspirators exception" of Hawai`i Rules of Evidence (HRE) Rule 803(a)(2)(C) (1993).(1)
Imelda's points of error (2)(a)(i), (2)(a)(ii), (2)(a)(iii), (2)(a)(iv), (2)(b)(i), (2)(b)(ii), (3), and (4) are without merit. With regard to her first point of error, we hold that Imelda's purported "substitution" as "personal representative" of the Marcos Estate was ineffective to bind the Marcos Estate but that her conduct during these proceedings judicially estops her from denying personal liability to the extent of her interest, as an heir, in the Marcos Estate. We further hold that Imelda is correct that the evidence, adduced at trial, of the value of the thousands of gold bars allegedly contained in unopened boxes discovered by Roxas and converted by Ferdinand was too speculative to support an award of damages. Accordingly, we reverse that portion of the circuit court's amended judgment concerning damages for conversion.
In their cross-appeal, the plaintiffs-appellees argue that the circuit court erred in: (1) ruling, as a matter of law, that conversion of property is a condition precedent to the imposition of a constructive trust and the commission of a fraudulent conveyance with respect to the property; (2) instructing the jury that the proper measure of damages for the conversion of the gold bars and the golden buddha was the value of the bars at the time of conversion rather than the highest value of the gold between the time of the conversion and the time of trial; and (3) failing to award prejudgment interest to the Roxas Estate and awarding inadequate prejudgment interest to GBC.
With regard to the plaintiffs-appellees' first point of error, we agree that conversion is not, pursuant to Philippine law, a condition precedent to liability based on a theory of constructive trust and that the circuit court erred in so ruling. Accordingly, we vacate the portion of the amended judgment entered in Imelda's favor on GBC's claim based on constructive trust and remand for further proceedings before the circuit court sitting in equity. On the other hand, we hold that the circuit court correctly ruled that the jury's verdict in this case precluded a finding of liability against Imelda for fraudulent conveyances.
With regard to the plaintiffs-appellees' second point of error, we hold that the circuit court erred in its instructions regarding the value to be assigned to the converted property, although we adopt a rule different than that advocated by the plaintiffs-appellees. Accordingly, we remand for a new trial on the limited question of the proper valuation of the converted property.
Finally, we hold that the circuit court abused its discretion in failing to award prejudgment interest to GBC from the time of the conversion of Roxas's property. Therefore, we remand the matter for the entry of an award of prejudgment interest in GBC's favor with respect to the converted property.
A. Factual Background(2)
1. Discovery of the treasure
Roxas worked as a locksmith in Baguio City, the Philippines. He was also an amateur coin collector and treasure hunter. In 1961, Roxas met a man named Fuchugami in Baguio City, who claimed that his father had been in the Japanese army and had drawn a map identifying the location of the legendary "Yamashita Treasure." The treasure purportedly consisted of booty, which had been plundered from various Southeast Asian countries, during World War II, by Japanese troops under the command of General Tomoyuki Yamashita and which was allegedly buried in the Philippines during the final battle for the islands in order to keep it out of the hands of the Americans.
At around the same time, Roxas met Eusebio Ocubo, who claimed to have served as General Yamashita's interpreter during World War II. Ocubo advised Roxas that, during the war, he had been taken to some tunnels controlled by General Yamashita, in order to retrieve silver to pay for food for the Japanese troops. There, he observed boxes of various sizes that contained gold and silver. Shortly thereafter, he also observed a golden buddha statue, which was kept at a convent near the tunnels.
Armed with Fuchugami's description of his father's maps and Ocubo's representations, Roxas organized a group of partners and laborers to search for the treasure and obtained a permit for the purpose from Judge Pio Marcos, a relative of Ferdinand. Judge Marcos informed Roxas that, in accordance with Philippine law, a thirty-percent share of any discovered treasure would have to be paid to the government.
Sometime in 1970, Roxas's group began digging on state lands near the Baguio General Hospital. After approximately seven months of searching and digging "24 hours a day," the group broke into a system of underground tunnels.
Inside the tunnels, the group found wiring, radios, bayonets, rifles, and a human skeleton wearing a Japanese army uniform. After several weeks spent digging and exploring within the tunnels, Roxas's group discovered a ten-foot thick concrete enclosure in the floor of the tunnel. On January 24, 1971, the group broke through the enclosure. Inside, Roxas discovered a gold-colored buddha statue, which he estimated to be about three feet in height. The statue was extremely heavy; it required ten men to transport it to the surface using a chain block hoist, ropes, and rolling logs. Although he never weighed the statue, Roxas estimated its weight to be 1,000 kilograms, or one metric ton. Roxas directed his laborers to transport the statue to his home and place it in a closet.
Roxas also found a large pile of boxes underneath the concrete enclosure, approximately fifty feet from where the buddha statue had been discovered. He returned the next day and opened one small box, which contained twenty-four one-inch by two-and-one-half-inch bars of gold. Roxas estimated that the boxes were, on average, approximately the size of a case of beer and that they were stacked five or six feet high, over an area six feet wide and thirty feet long. Roxas did not open any of the other boxes.
Several weeks later, Roxas returned to blast the tunnel closed, planning to sell the buddha statue in order to obtain funds for an operation to remove the remaining treasure. Before blasting the tunnel closed, Roxas removed the twenty-four bars of gold, as well as some samurai swords, bayonets, and other artifacts. Roxas twice attempted to report his find to Judge Marcos, but was unsuccessful in contacting him.
During the following weeks, Roxas sold seven of the gold bars and sought a buyer for the golden buddha. Roxas testified that Kenneth Cheatham, the representative of one prospective buyer, drilled a small hole under the arm of the buddha and assayed the metal. The test revealed the statue to be solid twenty-two carat gold.(3) Roxas also testified that a second prospective buyer, Luis Mendoza, also tested the metal of the statue, using nitric acid, and concluded that it was "more than 20 carats."
On April 1, 1971, Roxas showed the buddha to a third prospective buyer, Joe Oihara, who was accompanied by another individual, Romeo Amansec. Oihara told Roxas that he was staying at the home of Ferdinand's mother, Josefa Edralin Marcos. Oihara examined the buddha at length, performed another assay, and also closely scrutinized the designs on the statue. He indicated an interest in buying the buddha, promising to return in several days with a partial payment of one million pesos. Rendered suspicious by Oihara's long scrutiny of the buddha, Roxas undertook his own examination and discovered that the head was removable. Inside, he found "more than two hand[s]ful" of what he surmised to be uncut diamonds. He placed the diamonds in his closet near the buddha and replaced the head.
2. The raid on Roxas's house
On April 5, 1971, at 2:30 a.m., men purporting to be from the Criminal Investigation Service (CIS) and the National Bureau of Investigation (NBI), two Philippine national security agencies, knocked on Roxas's door, claiming to have a search warrant. When Roxas failed to respond, the men broke two of Roxas's front windows and pointed the barrels of their rifles inside. They informed Roxas that if he did not open the door within three minutes he would be shot.
Roxas opened the door, and eight men wearing military uniforms entered the house, accompanied by Oihara. They briefly displayed a document that they claimed was a search warrant. Before they snatched it away, Roxas was able to determine that it contained language regarding a "violation of [a] Central Bank regulation and illegal possession of firearms" and that it was signed by Judge Marcos. The men beat Roxas's brother with their rifles and ordered Roxas's family and his two bodyguards to lie down on the floor. When they left, they took the buddha, the diamonds, the remaining seventeen bars of gold, the samurai swords, a piggy bank belonging to Roxas's children, and his wife's coin collection.
Roxas reported the raid to the media and the local police. Subsequently, he went to Judge Marcos's home. Roxas asked Judge Marcos why he had signed the search warrant. Judge Marcos responded that he had had no choice because "the principe" ("the prince") had ordered the confiscation. When Roxas asked who "the principe" was, Judge Marcos responded that it was Ferdinand. Judge Marcos also advised Roxas that it was Oihara's companion, Amansec, who had initially applied for the search warrant, claiming to have seen a gun in Roxas's house. Judge Marcos appeared angry that Roxas had reported the case to the police and the media and stated that, as a result, the CIS and the NBI would likely kill Roxas. Roxas interpreted Judge Marcos's remarks as a threat; nevertheless, on April 7, 1971, Roxas returned to the police station and signed a complaint.
Roxas and his family traveled to Cabantuan City to enlist the aid of Provincial Governor Joson, who provided Roxas with four bodyguards. Roxas then went into hiding in Cabantuan City. Soon thereafter, on April 19, 1971, the military deposited a buddha statue with the City Court in Baguio City.
While he was in Cabantuan City, Roxas was approached by Rosario Uy and Anita Igna. They offered Roxas three million pesos to publicly affirm that the buddha statue held by the court was the same one that he had found. They also told him that they represented Ferdinand's mother. Roxas refused the offer. Later, Uy reached him by telephone and renewed the offer, assuring Roxas that he need not be afraid to accept because Ferdinand would be the one paying him. Roxas again refused.
Roxas's story began to appear regularly in the newspapers, radio, and television and to attract the attention of opposition politicians. Roxas met with a number of politicians, as well as with Philippine Secretary of Justice Vicente Abad Santos. Roxas told the Secretary his story, and the Secretary promised to guarantee Roxas's safety for a trip to Baguio City to identify the buddha in the City Court.
On April 29, 1971, Roxas traveled to the courthouse in Baguio City, accompanied by his bodyguards, two prosecutors from the Justice Department, a lawyer whom Roxas had hired, and a number of reporters and cameramen. Upon examination of the statue, Roxas concluded that it was not the same buddha that he had discovered because: (1) its color was different; (2) it had different facial features; (3) the head was not detachable; and (4) there was no hole under the arm where the original buddha had been drilled. On camera, Roxas announced his conclusion to those present. Roxas then brought the group to his house, where he showed them the damage caused by the raiding party and the closet where he had stored the buddha. Roxas later received an invitation to testify before the Philippine senate about the events; he did so on May 4, 1971.
3. Arrest and torture
On May 18, 1971, Roxas was arrested in Cabantuan City by three men in civilian clothing. Roxas testified that the men told him "to go with them to make a negotiation with the President." They also reassured him, "Don't be afraid. We are under Malacanang[(4)] -- you know, we are under Malacanang agent. We can make a negotiation to the President, and nothing more." The men took him to the home of Colonel Ponciano Gonzales.
There, an individual identified as Colonel Olivas punched Roxas in the stomach five times. When Roxas asked him why he was being beaten, Colonel Olivas responded, "You're mentioning the name of the President[.]" One of the men then said, "We must report to the President that Rogelio Roxas is in our custody." Colonel Olivas placed a telephone call, during which he appeared to Roxas to be speaking to Ferdinand, because he addressed the other party as "Mr. President."
Subsequently, Roxas was taken to the constabulary headquarters in San Fernando, Pampanga. Once there, a number of soldiers led him to a dark room, where he was shown a picture of his wife and children and told that he must cooperate if he wanted to see them again. The soldiers ordered Roxas to "pinpoint those senators, that they pay me to implicate the name of the president." Roxas refused to sign such a statement, and the soldiers responded by shocking him with wires attached to a large battery. The soldiers also interrogated Roxas about the location of the remaining treasure; however, he refused to divulge this information. The soldiers continued to shock him for several hours and, on one occasion, burned him with cigarettes.
Roxas was then taken to the residence of a judge, where he was directed to sign an affidavit. However, because of the torture he had endured, he was unable to clasp his hand around the pen, and, therefore, could not sign. The soldiers then transported Roxas to a hotel in Angeles City. There, he was questioned again about the location of the treasure. When he refused to respond, he was beaten with a rubber mallet until he passed out. After the beatings, he noticed a great deal of damage to his right eye and ear, neither of which ever fully healed.
Roxas was kept in a room at the hotel for two weeks, during which time he was repeatedly ordered to sign yet another affidavit. This affidavit averred that the raid in his house had been performed "in a peaceful manner" and that the members of the raiding party had possessed no automatic weapons as had been reported in the press. When Roxas finally signed the affidavit, he was brought back to the city court in Baguio City and ordered to point at the buddha statue while being photographed and to identify gold bars as those taken from his home.
That night, Roxas picked the lock on the window of his room and escaped. After finding refuge at his sister's home, Roxas contacted a senator and was again asked to testify before the senate, which he did on June 30, 1971. In his deposition in the instant case, Roxas testified that, during the June 30, 1971 hearing, he told the senators about being tortured.(5)
After the senate hearing, Roxas returned to Baguio City. Once there, he received a letter from Cesar Dumlao, a finance officer at the Malacanang, requesting a meeting on behalf of Ferdinand. Roxas met with Dumlao and was shown a letter, which indicated that Ferdinand was offering to pay him five million pesos.(6) Roxas was instructed to return the next day; however, he did not report back because he became frightened.
One week after his return to Baguio City, Roxas was arrested for failing to appear at a hearing on an illegal weapons charge that had been pending against him since January 28, 1971. He was brought before a judge, who ordered him incarcerated as a result of his default.
On August 21, 1971, Senator Osmena sent an attorney to bail Roxas out of jail. Roxas traveled with the attorney to Manila to meet with Senator Osmena. Senator Osmena asked Roxas to speak at a political rally that evening. Roxas agreed, but he was unable to speak because the rally was bombed before he could start. Roxas ran away and went into hiding for almost one year.
When Roxas finally returned to his Baguio City home in July 1972, he was immediately arrested by two men, who represented to him that they were from the CIS. These men took Roxas to a naval base in the province of Zambales, where he was confined in the stockade. While there, Roxas was questioned by Provincial Commander Rodolfo Patalinghod about his discovery of the golden buddha.
On September 21, 1972, Ferdinand declared martial law in the Philippines; the order remained in effect until 1983. After the declaration, General Fabian Ver visited Roxas in his cell. General Ver admitted that he had been among the raiding party at Roxas's house. He also told Roxas that there had been "an order to kill [Roxas] by the military," but that the order had been canceled when it was discovered that Roxas was a member of the Church of Christ. He advised Roxas to keep quiet about his case, in light of the fact that martial law had been declared.
In January 1973, Roxas was transferred to a prison camp in Baguio City and tried on the charges of possession of an illegal firearm and unlawfully firing a revolver into the air. He was convicted of both counts by the Third Branch of the City Court of Baguio and sentenced, in connection with the first charge, to an "indeterminate penalty of imprisonment ranging from One (1) year and One (1) day as minimum to Four (4) years as maximum" and, in connection with the second, to a fine. Judgment was entered on January 31, 1973. During his incarceration, Roxas was beaten and questioned about the location of the treasure on two occasions by a man known as Colonel Gemoto -- who identified himself as a member of the "Task Force Restoration" -- accompanied by representatives of the CIS.
4. Military excavations
Roxas was released from prison on November 19, 1974. When he arrived home the next day, he noticed soldiers standing outside tents near the Baguio General Hospital. Sometime in December 1974, some soldiers visited Roxas in his shop and told him that they were members of the Task Force Restoration, which was conducting excavations behind the hospital. They listed their address in Roxas's logbook (which was never produced at trial) as Malacanang Palace. The soldiers asked him to come with them to help with the excavation; he refused. Roxas passed by the site in 1976 and saw that the excavations were still ongoing. In October 1976, Roxas and his family moved to Visayan City, where they stayed for the next ten years without further incident relating to the Yamashita treasure.
Juan Quijon (Juan) and his son, Romulo Quijon (Romulo), corroborated Roxas's testimony regarding the excavations. Juan had worked as a nursing attendant at Baguio General Hospital from 1945 to 1988. He noticed a number of soldiers involved in excavation behind the hospital between 1974 and 1975. Over a one-week period, Juan observed men carrying large wooden boxes out of a tunnel and placing them in trucks. Each box was carried by at least four -- and sometimes six -- men. The soldiers' uniforms bore the initials "PSC," and the trucks had the letters "PMA" painted on them. Juan also observed men removing some steel boxes with the aid of a winch. The soldiers left in August 1975.
Romulo testified that he worked as a cook for the soldiers performing excavations behind the hospital in 1974. Romulo testified that the "PSC" on the soldiers' uniforms stood for "Presidential Security Command," and the "PMA" painted on the trucks stood for "Philippine Military Academy." The soldiers employed civilians to perform most of the digging. Romulo saw these civilians pushing and pulling boxes out of a hole and loading them into trucks. The boxes appeared to be old and in poor condition. Some fell apart while being carried, and gold-colored bars fell out onto the ground. Romulo observed approximately ten boxes per day being loaded into trucks over a period of one year. He testified that the soldiers were "very strict" about keeping the public out of the area and that armed guards were posted at the trucks during the loading.
5. Laundering and sale of the gold
Robert Curtis, an American owner of a mining and refining business in Sparks, Nevada, testified that, in late 1974, he received a number of telephone calls from Norman Kirst, an associate of Ferdinand, inviting him to travel to the Philippines to meet the president. Kirst stated that Ferdinand wanted Curtis's company to resmelt some gold bars and change the "hallmarks."(7) Ferdinand also wanted Curtis to change the chemical composition of the gold while resmelting it so that its origin would not be identifiable. Curtis initially refused the invitation, but finally relented and traveled to the Philippines to meet with Ferdinand.
When he arrived, Curtis met with a number of Ferdinand's aides and generals, including General Ver. He also met with Colonel Lachica, who was "Imelda Marcos' personal security and went with her wherever she went." Colonel Lachica took part in the conversations about resmelting and "rehallmarking and purifying the gold[.]" Finally, after approximately ten days, he met with Ferdinand, Olof Jonsson (another American, see infra), General Ver, and Kirst.
Ferdinand told Curtis that he had recovered an enormous amount of gold from the Yamashita treasure, which he had found at various sites, and that he needed help because the "International World Court had . . . passed a ruling that any . . . World War II treasures that were recovered would revert back to the countries from . . . whence they were taken." Ferdinand told him that he had so much gold that selling it could have a large effect on the world economy or even "start World War III."
Curtis also testified that General Ver had brought him to a basement room in the Marcoses' Miravelles summer palace, where the gold bars were kept. Curtis entered a room "about roughly 40 by 40," stacked to the ceiling with bars of gold. He estimated the ceiling to be ten feet high. Two or three four-foot wide aisles ran through the stacks of gold. The bars were in a standard seventy-five kilogram size. He noticed that the bars had "[o]riental markings" on them. Later, Ferdinand showed Curtis a solid gold buddha statue with a removable head, which Curtis identified from the pictures taken at Roxas's house as the same buddha that Roxas had discovered.
On cross-examination, Curtis testified that his study of the Yamashita treasure had suggested that the treasure contained eighteen buddhas and was distributed among 172 sites. He also testified that Ferdinand had told him that the gold that Curtis had seen had come from a site in the Luzon region. Moreover, in 1975, while Curtis was working with Ferdinand, another site was discovered in the town of Teresa, and more gold was retrieved.
Curtis and others began the work of designing and building a refinery in the Philippines to fulfill Ferdinand's requests. However, on July 5, 1975, General Ver took him to a military cemetery at Fort Bonafacio, walked him to a freshly-dug hole, and put a gun to his head, saying "[W]e're good friends but[,] I'm sorry, I have to do this." Curtis was able to talk General Ver out of shooting him and then quickly left the Philippines. He did not return to the Philippines as long as Ferdinand remained in power.
Olof Jonsson also testified that he had seen stacks of gold bars. Jonsson testified that he had first traveled to the Philippines at the invitation of a colonel stationed at Clark Air Force Base. He was brought there to use his powers as a psychic to locate gold that the colonel believed to be buried there. Jonsson described his psychic powers as including telekinesis, clairvoyance, telepathy, and the power to dematerialize objects with his mind.
While he was in the Philippines, Jonsson was asked to meet Ferdinand. He was brought to Ferdinand's office in the Malacanang Palace. Ferdinand invited Jonsson to stay at a guest house on the palace grounds. After several weeks, Jonsson left the Philippines, but he returned in 1975 with Curtis when the latter had traveled to the Philippines in order to discuss resmelting gold with Ferdinand. On this occasion, Jonsson met again with Ferdinand and General Ver. General Ver showed him a basement room in the guest house outside Malacanang Palace and another room in the summer palace, both filled with gold. He was also shown a golden buddha in the summer palace that was too heavy for him to move. Jonsson described the basement room in the guest cottage as being approximately twenty feet wide, forty feet long, and twelve feet high. He estimated the room in the summer palace as measuring "probably 40 feet by 25 or something" and twelve feet in height. Both rooms were filled with two-foot-long bars of gold stacked to the ceiling. Jonsson testified that it was possible that the bars were four inches wide and four inches thick, but that he could not recall exactly.
A number of witnesses also testified regarding Ferdinand's alleged attempts to sell his gold surreptitiously. Two Australian citizens, Michael O'Brien and John Doel, testified that they were partners in an Australian real estate venture. In 1983, O'Brien and Doel were seeking capital to finance their project. The partners met a Malaysian, Andrew Tan Beng Chong (Tan), who asked the partners to serve as brokers for the sale of ten thousand metric tons of gold in exchange for commissions on the sale. When O'Brien asked Tan the identity of the owner of such a large amount of gold, Tan stated only that the gold was available and could not be sold by regular means because of the source. O'Brien and Doel agreed to assist and created a company, designated "Remington," to carry out the transactions. The partners found buyers for the gold, and Doel subsequently traveled to the Philippines on April 20, 1983 at Tan's instruction. Doel met with Colonel Eike Manois, who claimed to represent the principal seller in the transaction but refused to disclose the seller's identity. At a subsequent meeting, however, a man identified as "Doming" Clemente, an associate of the colonel's, told Doel that Ferdinand was the owner of the gold. Clemente also stated that Imelda was aware of the transaction, but that Ferdinand was handling the details.
During the time that Doel and O'Brien were working on completing the transaction, Clemente relayed an offer from Ferdinand to sell Doel a one-ton golden buddha that Ferdinand had obtained in Baguio City. Doel refused the offer. Clemente also told Doel that the gold bars, which were the object of their transaction, had been "war booty items" and had been "buried in tunnels behind the hospital at Baguio City."
O'Brien also traveled to the Philippines. At one point, when he expressed doubt as to the existence of so much gold, he was blindfolded and taken to a warehouse. Inside the warehouse was a stack of approximately three hundred to four hundred boxes, each the size of a six-pack of beer. O'Brien opened one and observed that it contained three crudely smelted gold bars, which he described as being pitted "like an orange peel." He tried to lift several other boxes and found them too heavy to move. The partners were successful in having the parties sign contracts for the sale of the gold, but, as of July 1983, only a portion of the contracts were executed to their knowledge.
Norman Dacus, a retired American police officer, testified that he lived in the Philippines between August 1983 and April 1985. Dacus had relocated there because he had been recruited by a friend, Joseph Zbin, to become his partner "in brokering gold for [President] Marcos[.]" Dacus met with O'Brien and Clemente with respect to arranging gold transactions. He also met with Ferdinand, General Ver, and other army officers. Dacus was involved in "educating" Ferdinand about "how gold has a fingerprint on it and how you can tell which gold comes from which country." Ferdinand advised him that the first increments of gold he planned to sell were in ten-kilogram ingots, bearing the stamp of the Central Bank. At a subsequent meeting, Ferdinand stated that some of the gold was in metric ton blocks. On one occasion, Dacus was shown what he estimated to be one hundred metric tons of gold, located in a vault at the Coconut Planter's Bank. Later, Dacus was flown to Ilocas Norte and taken to a shrine constructed for Ferdinand. Inside, he observed an approximately four-foot tall, gold-colored buddha statue and what he estimated to be three hundred to five hundred metric tons of gold comprised of twenty-five kilogram ingots.
Based on portions of the testimony of Robert Curtis, Olof Jonsson, Michael O'Brien, and Norman Dacus, Nelson Colton, a long-time gold trader and manager in the gold refining industry, rendered an opinion regarding the value of the gold that the witnesses had allegedly observed. Colton estimated the volume and value of the gold described by the various witnesses in terms of the price of gold on the world market on various dates, including the time of the alleged conversion and in 1980, when gold was at its highest world price subsequent to the alleged conversion.
6. Move to Hawai`i
On February 25, 1986, after they were removed from power by a popular revolution, the United States government transported Ferdinand and Imelda to Hawai`i. Soon thereafter, Roxas contacted a childhood friend, Felix Dacanay, who had become a Georgia resident, to help him press his claims against the Marcoses. On June 3, 1986, Roxas assigned all of his rights to the Yamashita treasure to GBC, which Dacanay had incorporated in Georgia, in exchange for a minority holding of non-voting shares. Richard Hirschfield, an American attorney, testified that he met the Marcoses in Hawai`i in 1986 or 1987. Ferdinand hired him to arrange for an eighteen million dollar loan from Al-Fassi, a member of the Saudi royal family. Marcos offered to secure the loan with gold bullion, of which he claimed to possess tons. He told Hirschfield that he "had access to this Yamashita Treasure from the General of the Japanese War." Hirschfield also testified that either Ferdinand or Imelda told him that they had taken a golden buddha from the person who discovered the treasure and replaced it with a brass buddha.
7. The Baguio City Court proceeding regarding the buddha
Roxas died on May 25, 1993. On April 20, 1995, his brother, Jose Roxas (Jose), commenced an action in Branch III of the Regional Trial Court of Baguio City, praying for release of the buddha statue being retained by the clerk of court and claiming that "I and our family desire to keep the said buddha as a m[e]mento of our late brother, ROGELIO D. ROXAS." Jose's petition was supported by two of Roxas's sons; however, Jose admitted to the court that Roxas had had a number of children out of wedlock whose names he did not know "because [Roxas] had several mistresses."
At the initial hearing on the petition, conducted on April 28, 1995, Jose testified that he had been present when the raiding party confiscated the buddha. The court directed Jose to inspect the buddha in the clerk's possession and testify whether it was the same one taken from Rogelio Roxas. The court noted from its own observation that "[i]t appears . . . that the color is gold but it is superficial, it is only the outer part because there are parts where the color was chipoff [sic] and what you see is silver or white[.]" Jose identified the buddha as the statue confiscated from Roxas's house.
At a second hearing, held on May 15, 1995, Jose testified that the buddha that had been in Roxas's house was "made of lead or copper but the reporters added that said Buddha was made of gold." He testified further that "[Roxas] also knew it was made of lead" but that Roxas had claimed that it was gold because he had been bribed by politicians to do so. Accordingly, Jose described his purpose in initiating the proceeding as follows:
It is the claim of the reporter[s] that it was made of gold. The reporters are wrong. That's why if that Buddha will be given to me, I want it to be burned so that there will be no evidence against the Marcoses or it will not be a cause of shame to our country.
When the court asked him what he meant by "shame to our country," he responded that
a politician will be able to use it against [Ferdinand Romualdo, aka] Bongbong[,] Marcos [II]. . . . [b]ecause it is still fresh in the minds of our people that his father was blamed for confiscating the Buddha but the truth is that he did not do it. What I mean is that this Buddha can be a ground for shame as it was a substitute for what was allegedly to be the golden Buddha and allegedly seized by President Marcos and so lest it will be used for that purpose, this should be melted and obliterated. . . .
The trial court's record included a letter to the judge sent by Daniel Cathcart, the attorney for GBC and the Roxas Estate, dated June 27, 1995. The letter alleged that Imelda had met with Jose and offered him money to petition the court for the brass buddha and falsely identify it as the one taken from Rogelio. In the letter, Cathcart further stated:
I understand that another hearing is set for sometime in the month of July at which time the court may turn over the fake Buddha to Jose Roxas. I bring these facts to your attention so that you can determine whether or not the facts are true, and under the facts as you find them, whether the Buddha should be turned over to Jose Roxas.
Cathcart's letter concluded by asking the court to "deny possession of the fake Buddha to Jose Roxas." Another Philippine national, Alberto Umali, also submitted a claim to the buddha, based on a purported contract with Roxas to share the treasure that Roxas found. Umali claimed that he needed custody of the buddha in order to use it as evidence in furtherance of his efforts to recover the actual golden buddha.
The trial court filed an order containing its findings on May 30, 1996. The court determined that the buddha had been kept solely on the authority of a search and seizure order issued in 1971 and that the state was no longer legally justified in retaining it. The only question that remained was, as between Umali and Jose, who had the better claim to the buddha. The court ruled that Umali's contractual claim should be brought against the administrator of the Roxas Estate and was insufficient to support the release of the buddha to Umali in the current proceeding. Accordingly, the court released the buddha to Jose "IN TRUST FOR the estate of the late Rogelio Roxas." The court added the following observations:
Now, as to whether or not there is that controversial Golden Buddha different from the one now in custody of this Court, there is none. It bears repeating that the Republic of the Philippines with the vast resources under its command surely would and should have found that kind of treasure a long time since but the fact remains that it has not and the fact that it is made of gold appears merely to be the creation of unscrupulous minds.
This Court feels, rather sadly, that when the true Marcos estate is finally unraveled and subsequently ordered to be divided, everyone wants to be counted in. And in the frenzied and mad scramble for a share of the late President Marcos's estate, everything and anything is possible and anyone who shall get a share, whether deserved or not, becomes a matter of who has the cutting edge and the speculation is that whoever gets hold of the Buddha, in the final analysis, has that edge.
The court's order made no mention of Cathcart's letter or the facts alleged therein.
B. Procedural Background
1. Initial pleadings
Roxas and GBC filed the instant lawsuit against Ferdinand and Imelda on February 19, 1988. In the complaint, Roxas asserted claims of false imprisonment and battery against Ferdinand only. These claims related to his repeated detentions and torture, which the complaint specifically alleged that Ferdinand had orchestrated "for and on his own behalf and not in any official capacity as President of the Philippines or otherwise[.]" GBC asserted claims for relief against both Ferdinand and Imelda for (1) conversion, (2) constructive trust, and (3) fraudulent conveyances. In particular, GBC's claims related to the taking of the golden buddha, the gold bars, and other items from Roxas's home, as well as the taking of the gold bars from the treasure site and the subsequent conveyances of some of those items.
The Marcoses attempted to remove the action to the United States District Court for the District of Hawai`i, but the federal district court remanded the matter back to the first circuit court by an order filed on August 23, 1988. The Marcoses' first responsive pleadings in the state trial court consisted of a motion to dismiss the complaint, accompanied by a motion for a more definite statement, both filed on January 20, 1989. In their memorandum in support of the motion to dismiss, the Marcoses argued that the complaint should be dismissed because: (1) service of process was improper; (2) the actions were barred by the statute of limitations; (3) the defendants were immune under the doctrine of "head-of-state" immunity; (4) adjudication of the case was precluded under the "act of state" doctrine; and (5) the doctrine of forum non conveniens compelled dismissal.
The circuit court denied both motions by order dated April 25, 1989. The Marcoses filed an answer to the complaint on April 6, 1989. Among the affirmative defenses included in the answer was the claim that "[t]he court lacks personal jurisdiction over the Defendants."
2. Substitution of parties
On September 29, 1989, Ferdinand died. His death was first reflected in the record on June 5, 1990, when the plaintiffs-appellees filed motions for an order compelling discovery concerning the identity of the proper person to substitute as a party defendant for Ferdinand, as well as for an order extending the time to effect the substitution. Apparently, during the same period, Imelda was pursuing litigation in the Philippines in an attempt to be appointed personal representative of the Marcos Estate. In anticipation of her success, on March 17, 1992, the parties filed the following written stipulation:
IT IS HEREBY STIPULATED and agreed that Imelda Marcos be substituted pursuant to Rule 25 of the Hawai`i Rules of Civil Procedure[(8)] for the purpose of defending this litigation as the representative of Defendant Ferdinand Marcos deceased. This stipulation is without prejudice to any issue pertaining to abatement or survival of actions or claims.
After Roxas's death in 1993, the circuit court granted a motion to substitute Dacanay, in his capacity as personal representative of the Roxas Estate, for Roxas as a party plaintiff.
On June 6, 1995, Imelda's counsel filed a status report with the circuit court, noting that
[t]he government of the Republic of the Philippines ("Republic") and Mrs. Marcos have, during this time, litigated in the courts of the Philippines the question of whether the Republic or Mrs. Marcos should be designated by the Philippines probate court as personal representative of the estate of the late President Marcos. The probate court has ruled in favor of the Republic, and has appointed its designated representative as the administrator of the estate of the late President Marcos. Mrs. Marcos has vigorously opposed this decision on the grounds the Republic claims to be a creditor of the estate to the extent of the entirety of the assets in the estate, and therefore, is disqualified from being administrator of the estate.
Attached to the status report was a copy of a letter purportedly sent to one of the Marcoses' attorneys by the Solicitor General of the Philippines. The letter stated that a probate proceeding had been opened for Marcos's estate in the Regional Trial Court of Pasig, Metro Manila, the Philippines, and that the Commissioner of the Philippine Bureau of Revenue, Liwayway Vinzons-Chato, had been provisionally appointed as special administrator of the estate. Because Vinzons-Chato had not appointed counsel to represent her in any American trial proceedings, the Solicitor General instructed Imelda's counsel "to desist from representing the Estate of the late Ferdinand E. Marcos and/or to appear in any proceedings involving the Estate of the late Ferdinand E. Marcos, such as in the taking of depositions and/or representing the Estate thereat or at any other forum." The status report concluded that, "[i]n view of the conflicting positions, the Court may wish to defer trial of the cause until further resolution of the ongoing dispute between the Republic and Mrs. Marcos in the courts of the Republic." Vinzons-Chato never made any attempt to intervene in the present action, and neither party attempted to add her as a party defendant.
On January 11, 1996, the Regional Trial Court of the
National Capital Judicial Region, Branch 156, in Pasig City,
Metro Manila, filed an order admitting the will of Ferdinand
Marcos to probate.(9)
Pursuant to the provisions of that will, the
court appointed Imelda Marcos and her son, Bongbong, as executors
and personal representatives of the estate contingent on the
filing of a bond. However, at oral argument in the instant
appeal, Imelda's counsel represented to this court that, on
appeal of the trial court's order by the state, the Philippines
Supreme Court had reversed the trial court's order appointing
Imelda and Bongbong as executors.(10) On April 16, 1996, the plaintiffs-appellees moved to
substitute Irene Silverman for Ferdinand as a party defendant.
Silverman, a California attorney, had been appointed personal
representative of the Marcos Estate, with power over its
California assets, by the Los Angeles County Superior Court, in a
probate action initiated by GBC in California. See supra note 9.
In addition, GBC had petitioned the first circuit court to open a
probate proceeding in Hawai`i, naming Silverman as personal
representative of the Marcos Estate.(11) The plaintiffs-appellees
brought their motion for substitution of parties "on the grounds
that, as [a] result of the death of Ferdinand Marcos, it [was]
necessary to add the judicially-appointed personal representative
of his estate as a party defendant in his place and stead."
Imelda opposed the motion, arguing that the March 17, 1992
stipulated substitution filed by the parties sufficed: "[T]here
is a proper Rule 25 Substitution of Party. All defendants who
have appeared in this case, as I say, have been substituted where
appropriate in this case and there is no logical or legal basis
to appoint a personal representative." In opposing the motion,
however, Imelda made no mention of the January 11, 1996 Baguio
City trial court order. The plaintiffs-appellees countered that
"[w]hether or not that stipulation is effective and equivalent to
having a judiciously [sic] appointed administrator is an issue
that could be raised at a later time that could collaterally
attack this judgment, and[,] accordingly[, we] want to make sure
we had the right people here before we went to trial." The circuit court denied the plaintiffs-appellees'
motion on the ground that "Imelda Marcos has already by
stipulation agreed to defend as a personal representative," but
offered to reconsider its ruling if GBC was successful in
procuring an order from the Hawai`i probate proceeding naming
Silverman as personal representative of the Marcos Estate. The plaintiffs-appellees renewed their motion for
substitution on June 7, 1996. In her memorandum in opposition,
Imelda argued that Silverman was not a proper party for
substitution. In addition, however, her memorandum raised, for
the first time, the following equivocation: Although the undersigned counsel continue to represent Imelda
Marcos, individually and in her capacity as the agreed upon
representative of the defendant Ferdinand E. Marcos in this
litigation, we do not, and never have, represented any judicially
appointed personal representative of the Estate of Ferdinand E.
Marcos in this or any other litigation. . . . Without addressing the issue of whether the stipulation
entered into by the parties in this case is binding on the Estate for
purposes of being able to enforce whatever judgment, if any, may
be entered in this case against the Estate, and without addressing
the issue of whether the Estate may have a valid objection to these
proceedings and the enforcement of any judgment rendered herein
on the grounds that the undersigned counsel did not have any
authority to represent the Estate, Irene Silverman should not be
substituted in this action as the personal representative of the
Estate . . . . . . . Defendants do not, by virtue of this memorandum, take
a position on the necessity of adding a judicially appointed
representative of the Estate of Ferdinand E. Marcos for purposes of
this litigation. . . . The circuit court again denied the plaintiffs-appellees' motion for substitution, apparently(12) based on the
probate court's earlier oral ruling denying GBC's 1995 petition
for adjudication of intestacy and appointment of a personal
representative. On July 8, 1996, the probate court filed a written
order finally disposing of GBC's petition for appointment of
Silverman as personal representative of the Marcos Estate, ruling
that the Marcos Estate was not subject to probate in Hawai`i
because Ferdinand had neither (1) been domiciled in the state nor
(2) maintained property in the state at the time of his death.
Nevertheless, Silverman subsequently filed another petition
asking to be named special administrator of the Marcos Estate.
The probate court denied that petition, by order dated February
24, 1997, on the same grounds. On July 10, 1996, the plaintiffs-appellees petitioned
this court for a writ of mandamus ordering the circuit court to
substitute Silverman as a party defendant, arguing that the March
17, 1992 stipulated substitution of Imelda was insufficient as a
matter of law. We denied the petition. The issue resurfaced on several occasions during the
trial. In the course of jury selection, Imelda's counsel stated
that he represent[ed] Ferdinand Marcos and Imelda Marcos. Ferdinand
Marcos, as most of you know, if not all of you, is deceased and his
estate was never joined in this case so it's just as if he was being
sued as if [he] was [sic] alive. Of course he's not. The only thing that I want is someone who would be fair to
my clients. . . . (Emphases added.) In addition, during the settling of jury
instructions, the plaintiffs-appellees agreed with Imelda to
modify an instruction that advised the jury, as originally
drafted, that "[t]he defendants [in this case] are Imelda Marcos
and the Estate of Ferdinand Marcos" by removing the reference to
"the Estate." Imelda's counsel then requested that Ferdinand's
name appear before Imelda's in the instruction. The circuit
court agreed to the further modification. 3. Motion in limine to exclude out-of-court
statements of the Marcoses' alleged co-conspirators On January 29, 1996, Imelda filed a "Trial Brief On
Conspiracy, Vicarious Admissions[,] and Defendant's Assets" in
support, inter alia, of a motion in limine to exclude the out-of-court statements of the Marcoses' alleged co-conspirators and
agents. She argued that the plaintiffs-appellees had proffered
no evidence, other than the hearsay statements of the alleged co-conspirators and agents themselves, to connect the Marcoses to
any conspiracy. The plaintiffs-appellees responded on February
28, 1996 with an "Offer of Proof Re Conspiracy and Agency."
Attached to this lengthy document as appendices were portions of
the depositions of a number of witnesses, including Robert
Curtis, Norman Dacus, John Doel, Olof Jonsson, and Michael
O'Brien. The plaintiffs-appellees noted that Ferdinand had been
seen in possession of enormous amounts of gold, as well as a
golden buddha statue. On February 14, 1996, the circuit court conducted a
hearing on Imelda's motion in limine. The court ruled that, as a
threshold matter, the plaintiffs-appellees had established the
existence of a conspiracy involving Ferdinand and numerous
others, the object of which was to deprive Roxas of his
discovered treasure, arrest him, and torture him. In this
connection, the court ruled that the parties that were involved in the conspiracy are Romeo Amansec,
Colonel Marcelino Barba, Marcelino Cubacub, Sergeant DeVera, Colonel
Eduardo, Colonel Gonzalez, Anita Inga, Ferdinand Marcos, Judge Pio
Marcos, Colonel Olivas, the Presidential Security Command, Joe
Uehara,[(13)] Rosario Uy[,] and General Fabian Ver. That is as to the
original conspiracy to obtain the property. There are some unidentified parties, but to the extent that they were
testified about and to the extent that they made statements and appear to
have been in contact with then President Marcos, those statements can also
come in. The circuit court also found that there had been a separate
conspiracy to launder and dispose of the discovered treasure, the
members of which included Ferdinand and Imelda, as well as Domingo [sic] Clemente, Robert Curtis, Norman Dacus, Francisco
DeGuzman, John Doel, Norman Kirst, Colonel Lachica, Pedro Laurel, . . .
Ferdinand Bong Bong Marcos, Jr., . . . Victor Nituda, Michael O'Brien,
the President of the Central Bank[,] and General Fabian Ver. Accordingly, the circuit court ruled that the out-of-court
statements of these people, uttered in furtherance of the
conspiracy, would be admissible under the co-conspirators
exception to the hearsay rule pursuant to HRE Rule 803(a)(2). 4. Motions for partial summary judgment and in limine
regarding the Baguio City Regional Trial Court order On June 7, 1996, Imelda filed a motion for partial
summary judgment on GBC's claim for conversion of the golden
buddha, as well as a motion in limine to exclude evidence
concerning the golden buddha. Both motions were predicated on
the May 30, 1996 order of the Baguio City Regional Trial Court
releasing the buddha in the clerk's custody to Jose Roxas.
Imelda contended that the trial court's finding that the buddha
taken from Roxas was not made of gold was binding on GBC "under
the principles of res judicata and collateral estoppel." She
argued that Cathcart's letter constituted an "appearance" in the
proceedings in the Baguio City Regional Trial Court and that
Umali also represented GBC as local counsel. Cathcart denied
that Umali was associated with GBC and asserted that he had been
accorded no notice of the proceedings in the Baguio City Regional
Trial Court prior to writing his letter. On July 16, 1996, the circuit court denied Imelda's
motions, ruling that GBC had not been accorded due process in the
Baguio City proceedings. 5. Motion for directed verdict Imelda moved for a directed verdict on July 12, 1996.
She argued that: (1) the "act of state" doctrine precluded the
plaintiffs-appellees' lawsuit; (2) the "head of state" doctrine
rendered the Marcoses immune from the lawsuit; (3) the circuit
court lacked personal jurisdiction over Ferdinand Marcos; and (4)
there was insufficient evidence to support any of the asserted
claims for relief. The circuit court denied the motion. 6. Verdict and judgment The circuit court submitted the Roxas Estate's claims
of battery and false imprisonment and GBC's claim of conversion
to the jury. It reserved GBC's equitable claims of constructive
trust and fraudulent conveyances to be decided by the court after
the jury returned its verdict. The jury returned a special verdict on July 19, 1996,
finding in favor of the Roxas Estate and against "Ferdinand
Marcos" on the Roxas Estate's claims of battery and false
imprisonment and awarding damages in the amount of $6,000,000.00.
The jury further found in favor of GBC and against "Ferdinand
Marcos" on the conversion claim, itemizing the value and quantity
of property converted, "on the date of the conversion," on the
verdict form as follows: (1) one golden buddha, valued at
$1,300,000.00; (2) seventeen gold bars, valued at $100,000.00;
(3) one coin collection, valued at $5,000.00; (3) "3 handfuls" of
diamonds, of unknown value; and (4) "one storage area" of gold
bullion, valued at $22,000,000,000.00. By contrast, the jury found in favor of Imelda, in her
individual capacity, and against GBC on its conversion claim
against her. In addition, the jury found, inter alia, that: (1)
Ferdinand had not been "acting in his capacity as President and
Commander-in-Chief of the Armed Forces of the Philippines when he
took the actions complained of by the plaintiffs"; (2) the
converted property had not been "taken pursuant to a valid search
warrant"; (3) Roxas had not been "lawfully arrested, tried,
convicted and imprisoned in accordance with Philippine law"; and
(4) the plaintiffs had "filed this lawsuit within the time frame
provided by law." The circuit court filed its judgment pursuant to the
jury's verdict on August 28, 1996. The judgment recited that it
was entered "in favor of Plaintiff Felix Dacanay, as Personal
Representative of the Estate of Roger Roxas" and "against
Defendant Ferdinand Marcos" on the battery and false imprisonment
claims and in favor of GBC and "against Defendant Ferdinand
Marcos" on the conversion claim. Judgment, however, was entered
in favor of Imelda and against the plaintiffs-appellees on all
claims that they had asserted against her. In the judgment, the
circuit court reserved jurisdiction over GBC's claims of
constructive trust and fraudulent conveyance as to Ferdinand, as
well as over the issues of costs, attorneys' fees, and
prejudgment interest. 7. Motion for prejudgment interest The circuit court addressed the plaintiffs-appellees'
motion for prejudgment interest at a hearing held on September,
20, 1996. The Roxas Estate argued that it was entitled to
prejudgment interest at the rate of ten percent per annum from
April 5, 1971, the date on which Roxas was allegedly first
beaten, through July 19, 1996, the date of the jury's special
verdict. GBC argued that it was entitled to prejudgment interest
at the rate of ten percent per annum from January 1, 1975 through
July 19, 1996, encompassing "the period of time in which
[Ferdinand] converted the balance of the treasure from the
tunnels at Baguio City." During the hearing on the issue, the
circuit court indicated that it was concerned that the jury
instructions had not made clear to the jury whether its damage
award for battery and false imprisonment was to be based on the
value of the injury at the time it was sustained and that the
award might have been made in "today's dollar[,] which is very
different from what the value of the assault may have been on the
date of the assault." Accordingly, the circuit court took the
matter under advisement. In an order filed on October 18, 1996, the circuit
court granted the plaintiffs-appellees' motion in part and denied
it in part, awarding GBC prejudgment interest at the rate of ten
percent per annum from February 19, 1988 -- the date of the
filing of the lawsuit -- to July 19, 1996 -- the date of the
jury's special verdict --, in the amount of $18,517,346,893.15.
The circuit court denied the motion as to the claims of the Roxas
Estate. 8. Imelda's motions for judgment notwithstanding the
verdict and for a new trial Imelda filed a motion for judgment notwithstanding the
verdict on September 9, 1996, reiterating the arguments advanced
in support of her motion for a directed verdict. On the same
day, she filed a motion for a new trial as to Ferdinand only,
arguing that: (1) the circuit court had erred by admitting
hearsay statements under the co-conspirators exception of HRE
Rule 803; and (2) the verdict was against the weight of the
evidence, both as to liability and as to the amount of damages.
The circuit court denied both motions in orders filed on October
18, 1996. 9. The plaintiffs-appellees' motion to alter the
judgment On September 6, 1996, the plaintiffs-appellees moved to
alter the judgment pursuant to Hawai`i Rules of Civil Procedure
(HRCP) Rule 59 (1996).(14) The plaintiffs-appellees argued that
the judgment should be amended: (1) to add the "Estate of
Ferdinand Marcos" as a proper party defendant; (2) to increase
the value of damages awarded to GBC to reflect the highest value
of the gold during the time of the conversion; (3) to strike the
judgment in favor of Imelda, inasmuch as GBC's claims of
constructive trust and fraudulent conveyance against her had yet
to be tried; and, accordingly, (4) to reserve jurisdiction on
those claims as well with regard to the Marcos Estate. At the conclusion of the hearing on the motion, the
circuit court ruled as follows: With regard to Imelda Marcos as a party to the remaining causes of
action[,] the Court notes that[,] by way of its verdict, the jury has found
that she was not legally responsible for any conversion. And a conversion
is a condition precedent to establishing constructive trust or that there be
fraudulent conveyance thereafter. And so the Court denies the plaintiffs'
request to add Imelda Marcos as to the remaining causes of action. With regard to the matter of the Estate of Ferdinand Marcos, as
counsel are well aware, at every juncture when the plaintiffs had attempted
to add or substitute Irene Silverman as a representative of the Estate, this
Court did not intend to suggest that the appropriate party defendant was
the Estate of Ferdinand Marcos. And the Court refers counsel to the action
taken by the Honorable Patrick Yim[,] who, pursuant to Rule 25, did
substitute Imelda Marcos as a representative for the Estate of Ferdinand
Marcos. So the Court will grant the Motion to Alter Judgment. And the
judgment will reflect a judgment against the Estate of Ferdinand Marcos,
Imelda Marcos as personal representative. With regard to the Motion to Alter Judgment, with regard to the
amount of damages returned by the jury, the Court stands on its prior
ruling that the issue of the value of gold should be the value at the time of
the conversion and not at the highest value reached. And the Court denies
the Motion to Alter Judgment to reflect damages at the $860 an ounce
amount. Accordingly, the circuit court entered judgment against
"Defendant Imelda Marcos, as Personal Representative of the
Estate of Ferdinand Marcos" on the battery, false imprisonment,
and conversion claims, by an amended judgment filed on October
21, 1996. II. STANDARDS OF REVIEW A. Motion To Alter Judgment This court reviews a circuit court's decision to grant
a motion to alter a judgment pursuant to HRCP Rule 59(e) for
abuse of discretion. Gossinger v. Association of Apartment
Owners of the Regency of Ala Wai, 73 Haw. 412, 425, 835 P.2d 627,
634 (1992). "An abuse of discretion occurs if the trial court
has clearly exceeded the bounds of reason or has disregarded
rules or principles of law or practice to the substantial
detriment of a party litigant." State v. Davia, 87 Hawai`i 249,
253, 953 P.2d 1347, 1351 (1998) (citations and internal quotation
signals omitted). B. Conclusions Of Law We review the trial court's [conclusions of law] de novo under the
right/wrong standard. Raines v. State, 79 Hawai`i 219, 222, 900 P.2d
1286, 1289 (1995). "Under this . . . standard, we examine the facts and
answer the question without being required to give any weight to the trial
court's answer to it." State v. Miller, 4 Haw. App. 603, 606, 671 P.2d
1037, 1040 (1983). See also Amfac, Inc. v. Waikiki Beachcomber Inv.
Co., 74 Haw. 85, 119, 839 P.2d 10, 28, reconsideration denied, 74 Haw.
650, 843 P.2d 144 (1992). Thus, a [conclusion of law] "is not binding
upon the appellate court and is freely reviewable for its correctness." State
v. Bowe, 77 Hawai`i 51, 53, 881 P.2d 538, 540 (1994) (citation omitted). State v. Kane, 87 Hawai`i 71, 74, 951 P.2d 934, 937 (1998)
(quoting Aickin v. Ocean View Inv. Co., 84 Hawai`i 447, 453, 935
P.2d 992, 998 (1997)) (brackets in original). C. Motions For Directed Verdict And For Judgment
Notwithstanding The Verdict [D]enials of directed verdict or judgment notwithstanding the
verdict (JNOV) motions are reviewed de novo. Verdicts based on
conflicting evidence will not be set aside where there is substantial
evidence to support the jury's findings. We have defined "substantial
evidence" as credible evidence which is of sufficient quality and probative
value to enable a person of reasonable caution to support a conclusion. In deciding a motion for directed verdict or JNOV, the evidence
and the inferences which may be fairly drawn therefrom must be
considered in the light most favorable to the nonmoving party and either
motion may be granted only where there can be but one reasonable
conclusion as to the proper judgment. Kawamata Farms v. United Agri Products, 86 Hawai`i 214, 253, 948
P.2d 1055, 1094 (1997) (quoting Takayama v. Kaiser Found. Hosp.,
82 Hawai`i 486, 495, 923 P.2d 903, 912 (1996) (citation, some
internal quotation marks, and original brackets omitted)). See
also Tabieros v. Clark Equip. Co., 85 Hawai`i 336, 350, 944 P.2d
1279, 1293 (1997). D. Summary Judgment We review [a] circuit court's [denial] of summary judgment de
novo under the same standard applied by the circuit court. Amfac Inc., . . .
74 Haw. [at] 104, 839 P.2d [at] 22 . . . (citation omitted). As we have
often articulated: [s]ummary judgment is appropriate if the pleadings, depositions,
answers to interrogatories, and admissions on file, together with
the affidavits, if any, show that there is no genuine issue as to any
material fact and that the moving party is entitled to judgment as a
matter of law. Id. (citations and internal quotation marks omitted); see . . . HRCP . . .
Rule 56(c) (1990). Estate of Doe v. Paul Revere Ins. Group, 86 Hawai`i 262, 269-70,
948 P.2d 1103, 1110-11 (1997) (quoting Morinoue v. Roy, 86
Hawai`i 76, 80, 947 P.2d 944, 948 (1997)) (some brackets added
and some in original). E. Admission Of Statements Of Co-Conspirators Before admitting a co-conspirator's statement over objection that it
does not qualify under HRE 803(a)(2)(C), the trial court must be satisfied
that the statement actually falls within the definition of that rule; "[t]here
must be evidence that there is a conspiracy involving the declarant and the
nonoffering party, and that the statement was made 'during the course and
in furtherance of the conspiracy.'" Bourjaily [v. United States], 483 U.S.
[171,] 175 . . . [(1987)]; accord State v. Yoshino, 45 Haw. 206, 214-15,
364 P.2d 638, 644 (1961). "Preliminary questions concerning the . . .
admissibility of evidence shall be determined by the court." HRE 104(a)
(1985). Where the preliminary facts necessary for the admissibility of
evidence are disputed, the offering party has the burden to prove facts
supporting admission by a preponderance of the evidence. See Bourjaily,
483 U.S. at 176 . . . . On appeal, the trial court's determination of preliminary factual
issues concerning the admission of evidence will be upheld unless clearly
erroneous. See id. at 181 . . . . "A finding of fact is clearly erroneous
when, despite evidence to support the finding, the appellate court is left
with the definite and firm conviction in reviewing the entire evidence that
a mistake has been committed." Hawai`i's Thousand Friends v. City and
County of Honolulu, 75 Haw. 237, 248, 858 P.2d 726, 732 (1993) (citation
omitted) (internal brackets omitted). State v. McGriff, 76 Hawai`i 148, 157, 871 P.2d 782, 791 (1994). F. Jury Instructions When jury instructions or the omission thereof are at issue on
appeal, the standard of review is whether, when read and considered as a
whole, the instructions given are prejudicially insufficient, erroneous,
inconsistent, or misleading. Erroneous instructions are presumptively harmful and are a ground
for reversal unless it affirmatively appears from the record as a whole that
the error was not prejudicial. Tabieros, 85 Hawai`i at 350, 944 P.2d at 1293 (quoting State v.
Arceo, 84 Hawai`i 1, 11, 928 P.2d 843, 853 (1996) (citations,
internal quotation marks, and brackets omitted)). G. Prejudgment Interest "Prejudgment interest, where appropriate, is awardable
under Hawai`i Revised Statutes (HRS) § 636-16 (1993)[(15)] in the
discretion of the court and is reviewed under the abuse of
discretion standard." Eastman v. McGowan, 86 Hawai`i 21, 26-27,
946 P.2d 1317, 1322-23 (1997) (citations omitted). III. DISCUSSION A. The Circuit Court Committed An Abuse Of Discretion In
Altering The Judgment To Designate Imelda Marcos As Personal
Representative Of The Marcos Estate, But Imelda's Own Misconduct
Warranted Entry Of Judgment Against Her In Her Personal Capacity
To The Extent Of Her Interest In The Marcos Estate. Imelda urges on appeal that the circuit court erred in
granting the plaintiffs-appellees' motion to alter the judgment
in order to enter judgment against her as "personal
representative" of the Marcos Estate. She asserts that her
stipulated substitution, pursuant to HRCP Rule 25, see supra note
8, as "the representative of Defendant Ferdinand Marcos deceased"
was insufficient to justify the entry of a judgment against the
Marcos Estate itself. HRS § 634-61 (1993) provides in pertinent part that
"[t]he death of a . . . defendant . . . shall not cause an action
to abate, but it may be continued upon substitution of the proper
parties as determined by the rules of court[.]"(16) (Emphasis
added.) HRCP Rule 25(a)(1), see supra note 8, provides for the
substitution of "the proper parties" in the case of the death of
an originally named party. The term "proper parties" is neither
defined in the HRS nor in the HRCP. Imelda argues that "proper parties," within the
meaning of HRCP Rule 25(a)(1), are restricted to legal
representatives, i.e., judicially-appointed representatives.
Accordingly, Imelda maintains that, inasmuch as she was not a
judicially-appointed personal representative, she had no power to
bind the Marcos Estate, and the amended judgment against it was,
therefore, a nullity. The plaintiffs-appellees counter that: (1) Imelda's
argument is precluded by the doctrine of collateral estoppel; (2)
HRCP Rule 25(a)(1) allows for substitution of the heirs of a
party and not the party's legal representative; and (3) Imelda's
stipulation should bind her and this court on the issue of her
status as the successor to Ferdinand in the instant litigation. We address the foregoing issues in the order presented
by the plaintiffs-appellees. 1. The "substitution of parties" issue is not
precluded by the doctrine of collateral estoppel. The plaintiffs-appellees argue that the question
whether Imelda could properly be substituted as the personal
representative of the Marcos Estate was previously litigated and
decided in a federal lawsuit brought against the Marcoses by a
class of Philippine victims of torture and detention. See Hilao
v. Estate of Marcos, 103 F.3d 762 (9th Cir. 1996) (Hilao I).
Roxas was not a party to Hilao I, having opted out of the group
of class action plaintiffs in order to pursue the instant
lawsuit. In that case, the plaintiffs moved for a contempt order
against Imelda and Bongbong, alleging violation of a preliminary
injunction prohibiting the Marcos Estate and its representatives
from disposing of any assets of the Estate. Id. at 763. The
plaintiffs maintained that Imelda and Bongbong had transgressed
the preliminary injunction by "(1) agreeing to transfer artworks
beneficially owned by the Defendant Estate from the United States
to the Philippines; and (2) agreeing to divide all assets owned
by the Estate between the Republic and the Appellants." Id. at
763-64. The district court granted the motion. Id. at 764. On
appeal, the United States Court of Appeals for the Ninth Circuit
ruled, inter alia, as follows: Appellants argue that they are non-parties to this litigation and
have not been appointed as personal representatives of the Estate. They
argue that their status leaves them powerless to transfer or alienate assets
of the Estate, and therefore incapable of being in contempt of an injunction
forbidding transfer and alienation. Appellants acknowledge their
voluntary substitution as legal representatives of the Defendant Estate for
the purposes of defending this action, but argue that in spite of the
substitution, they remain non-parties. Appellants' arguments regarding their status as non-parties are
without merit. Rule 25(a)(1) of the Federal Rules of Civil Procedure
[(FRCP)] provides that "[i]f a party dies and the claim is not thereby
extinguished, the court may order substitution of the proper parties". The
substituted party steps into the same position as [the] original party.
Ransom v. Brennan, 437 F.2d 513, 516 (5th Cir.), cert. denied, 403 U.S.
904 . . . (1971). As properly substituted parties in this case, Appellants
obviously are not non-parties. Appellants clearly had notice of, and were
subject to, the terms of the injunction. Id. at 766 (footnote omitted). Pursuant to the foregoing passage
from Hilao I, the plaintiffs-appellees insist that Imelda is
estopped from asserting that her substitution was improper in the
instant case. Collateral estoppel is a bar to relitigation of an
issue where "(1) the issue decided in the prior suit is identical
to the issue presented in the action in question; (2) there was a
final judgment on the merits in the prior suit; and (3) the party
against whom collateral estoppel is asserted was a party or in
privity with a party to the prior suit." State of Hawai`i Org.
of Police Officers (SHOPO) v. Society of Professional Journalists
-- University of Hawai`i Chapter, 83 Hawai`i 378, 400, 927 P.2d
386, 408 (1996) (citing Bush v. Watson, 81 Hawai`i 474, 480, 918
P.2d 1130, 1136, reconsideration denied, 82 Hawai`i 156, 920 P.2d
370 (1996), cert. denied sub nom Albino v. Machado, 117 S. Ct.
1082 (1997)). The first prong of the test for collateral estoppel --
identity of issue -- has not been met here. The Hilao I court
decided that Imelda and Bongbong had been properly substituted in
that case pursuant to Rule 25 of the federal rules of civil
procedure. In the present case, Imelda raises a question of
interpretation of the Hawai`i rule. As the plaintiffs-appellees
note, "HRCP Rule 25 is nearly identical to its federal
counterpart." Nonetheless, they are not coextensive, and the
federal court's interpretation of the federal rule is not binding
on Hawaii's interpretation of its own rule. Accordingly, the
Hilao I court's legal conclusion as to FRCP Rule 25 did not
decide the same issue as that presented in the matter before us,
and Imelda is therefore free, on appeal, to question the
significance of her substitution pursuant to the March 17, 1992
stipulation. 2. HRCP Rule 25(a)(1) does not allow for substitution
of a party merely because she is the widow of the original
defendant. a. There is no controlling Hawai`i case law. Turning, then, to the substance of Imelda's argument,
we address the meaning of the term "proper parties" for purposes
of HRCP Rule 25(a)(1). The plaintiffs-appellees argue that
existing Hawai`i precedent supports their argument that "proper
parties" include an heir of a deceased defendant, regardless of
whether the heir has been judicially appointed as the legal
representative of the estate. They cite first to Colburn v.
United States Fidelity and Guarantee Co., 25 Haw. 479 (1920). In
Colburn, this court addressed the question whether, under the
then-existing statutory framework, a plaintiff-appellant who died
after filing an appeal could be replaced by the executor of his
estate as a proper party. Id. This court held that [t]he statute makes no provision for procedure where a case has
proceeded to final judgment and has been removed to this court upon
appeal but it seems clear to us that in such a case where the plaintiff dies
after the case is entered in this court the personal representative of the
deceased plaintiff (or his heirs where they instead of the personal
representative would succeed to his rights) should be permitted to appear
in his stead. Id. at 481 (emphasis added). Although the plaintiffs-appellees
rely on the foregoing language, it is apparent, in context, that
this court's parenthetical qualification was intended to apply to
instances in which heirs have succeeded directly to the
plaintiff's rights, if any, in a claim for relief, such as, for
example, an action for title to land. In the present case,
Imelda does not claim to be Ferdinand's successor-in-interest to
any material claims for relief. Unlike the procedural posture of
Colburn, the present case poses the question whether Imelda may
be substituted, as a successor defendant on behalf of the Marcos
Estate, regarding claims for battery, false imprisonment, and
conversion initially asserted against Ferdinand. Next, the plaintiffs-appellees cite Sutton v. Ho, 43
Haw. 241 (1959), for the proposition that, as the plaintiffs-appellees put it, "in an action involving title to land, heirs
may be substituted for the deceased party, though they need not
be." Be that as it may, the Sutton court emphasized that
"[t]here is no question that the administrators are the proper
and the only necessary parties to be substituted for present
appellees if the case involved a controversy over personal
property only." Id. at 242 (citing, inter alia, Colburn). It is
only where a dispute involves title to land that a claim for
relief may be revived in the names of a deceased's heirs,
although such a claim for relief may also be revived exclusively
in the name of the deceased's personal representative. Id.; see
also Campbell v. DuPonte, 57 Haw. 510, 518, 559 P.2d 739, 744,
reh'g denied, 57 Haw. 564, 560 P.2d 1303 (1977). Of course, the
instant case does not involve real property. Finally, the plaintiffs-appellees point out that, in
Carter v. Davis, 18 Haw. 439, 454 (1907), this court "construed
the terms 'legal representatives' and 'personal representatives'
to mean 'heirs,' as well as executors and administrators of an
estate within the context of a trust deed." Once again, however,
the plaintiffs-appellees fail to appreciate the context of this
court's ruling. As the Carter court clearly held, the
construction of particular terms contained within a trust deed is
dependent upon the relationship between those terms and the rest
of the document, as well as the intent of the deed's drafter.
Id. at 454-55. Accordingly, this court's construction of the
terms "legal representatives" and "personal representatives," as
contained in the particular 1879 trust deed at issue in Carter,
is of little assistance to our current task of interpreting the
meaning of HRCP Rule 25(a)(1). This court came closer to addressing the issue at bar
in Bagalay v. Lahaina Restoration Foundation, 60 Haw. 125, 588
P.2d 416 (1978). In Bagalay, this court construed the former
version of HRS § 663-7 (1955), which allowed survival of actions
"in favor of the legal representative" of the decedent party.
Id. at 135 & n.5, 588 P.2d at 423 & n.5. Noting the holding in
Carter, the Bagalay court observed that, [i]n the context of survival statutes similar to that of HRS § 663-7, one
court has construed the term to include heirs-at-law, regardless of the fact
that the heir had not qualified as an administrator of the decedent's estate.
Strother v. District of Columbia, 372 A.2d 1291 (D.C. 1977). Other courts
have held that the term refers only to executors and administrators who
have been appointed either by law or by will. Hill v. James, 252 Miss.
501, 175 So.2d 176 (1965); State v. Hollenbeck, 394 S.W.2d 82 (Mo. [Ct.
App.] 1965). Id. at 136, 588 P.2d at 423-24. However, the Bagalay court
expressly declined to weigh in with respect to the conflicting
authority: "It is not necessary, in this case, to decide whether
the term 'legal representative' includes heirs at law[.]" Id. at
136, 588 P.2d at 424 (emphasis added).(17) Accordingly, it appears that the question at issue
remains one of first impression in Hawai`i. b. The majority rule in other jurisdictions is
that only judicially appointed representatives may
be substituted for a decedent party. Imelda cites to the decisions of a number of federal
and state courts that have construed their respective equivalents
of HRCP 25(a)(1) to restrict the substitution of the parties in
the event of death to the deceased's legal representative,
meaning the judicially appointed representative. Indeed, this
appears to be the majority view. See, e.g., Malonee v. Fahy, 200
F.2d 918, 919 (9th Cir. 1952); Roberson v. Wood, 500 F. Supp.
854, 859 (S.D. Ill. 1980); Marcano v. Offshore Venezuela, 497 F.
Supp. 204, 207 (E.D. La. 1980); Madison v. Vintage Petroleum,
Inc., 872 F. Supp. 340, 342 (S.D. Miss. 1994), aff'd, 87 F.3d
1311 (5th Cir. 1996); Killough v. Killough, 373 So.2d 336, 337-38
(Ala. Ct. App. 1979); Fryer v. Kaiser Found. Health Plan, Inc.,
34 Cal. Rptr. 688, 691 (Cal. Ct. App. 1963); Epps v. Vogel, 454
A.2d 320, 323 n.3 (D.C. Ct. App. 1982) (noting that the federal
courts normally require a legal representative); In re Estate of
Einstoss, 257 N.E.2d 637, 641 (N.Y. 1970); see also 7C Wright &
Miller, Federal Practice and Procedure § 1956 (1986). A number of courts have crafted a narrow exception to
the foregoing rule in favor of the primary distributee of an
already-distributed estate. See Kilgo v. Bowman Transp. Inc., 87
F.R.D. 26 (N.D. Ga. 1980), aff'd 789 F.2d 859 (11th Cir. 1986)
(person named as executor in plaintiff's will, but who does not
become executor because he elects statutory share rather than
probating will, is a substitutable "proper party"); Ashley v.
Illinois Cent. Gulf R.R. Co., 98 F.R.D. 722, 724 (S.D. Miss.
1983) ("Unless the estate of a deceased party has been
distributed at the time of the making of the motion for
substitution, the 'proper' party for substitution would be either
the executor or administrator of the estate of the deceased.");
Hardy v. Kaszycki & Sons Contractors, 842 F. Supp. 713 (S.D.N.Y.
1993) (mem.) (holding that widow was proper party to substitute,
where husband's estate contained insurance policies in favor of
his heirs); Gronowicz v. Leonard, 109 F.R.D. 624, 626 (S.D.N.Y.
1986). As noted above, the plaintiffs-appellees rely on Hilao
I, in which the Ninth Circuit upheld the substitution of Imelda
and Bongbong for the Marcos Estate pursuant to FRCP Rule
25(a)(1). Hilao I, 762 F.3d at 766. However, we are constrained
to note that the Hilao I court offered no analysis in reaching
its ipse dixit result. Further, the plaintiffs-appellees cite to
McSurely v. McClellan, 753 F.2d 88 (D.C. Cir.), cert. denied, 474
U.S. 1005 (1985). In that case, the court held that requiring a
"legal representative" for substitution under Rule 25(a)(1) would
be overly burdensome on a plaintiff: "[c]ompelling a plaintiff
to 'institut[e] machinery in order to produce some representative
of the estate ad litem' would contravene the purpose of amended
Rule 25(a)(1) 'to dispel unwarranted rigidity and allow more
flexibility in substitution.'" Id. at 98 (quoting Rende v. Kay,
415 F.2d 983, 986 (D.C. Cir. 1969)). However, in McSurely, the
estates of the deceased parties had been distributed to the
respective widows prior to their substitution, and the court
relied, in part, on the "already-distributed estate" exception
described in Ashley and Kilgo, supra. McSurely, 753 F.2d at 96,
99. By contrast, there is no evidence in the present record that
the Marcos Estate had been distributed -- either at the time the
stipulated substitution was filed or at the time the plaintiffs-appellees moved to alter the judgment. In any event, to the extent that the broad language
of McSurely supports the plaintiffs-appellees' position that any
heir may be substituted for a deceased defendant, the reasoning
is unpersuasive. A party-defendant might very well, depending on
the laws of the state or country with jurisdiction over probate,
disinherit his or her spouse in his or her will. Moreover, a
lawsuit in which the decedent's spouse is substituted as a party
defendant may come to judgment before probate of the decedent's
will is completed. Knowing that he or she is not provided for in
the decedent's will, such a spouse might not be motivated
properly to defend the estate's interests as a substituted party.
Alternatively, the rule suggested by the plaintiffs-appellees invites the scenario in which an heir is substituted as
the "proper party" even though a personal representative or
special administrator has already been appointed by a probate
court for the estate of the deceased party. Indeed, in the
instant case, a special administrator, Commissioner Vinzons-Chato, had been named for the Marcos Estate by the Philippine
probate court prior to the filing of the plaintiffs-appellees'
motion to alter the judgment. As all sides appear to
acknowledge, Vinzons-Chato and Imelda were not of one mind as to
the distribution of the Marcos Estate. Moreover, at the time of
the motion to alter the judgment, both the parties and the
circuit court were aware that GBC had failed to secure the
appointment of an alternate personal representative in Hawai`i
probate proceedings. Finally, we note that the Hawai`i Uniform Probate Code (UPC),
HRS chapter 560, clearly contemplates that a personal
representative or special administrator is to represent an
estate, in judicial proceedings and otherwise, in dealing with
the estate's creditors. See HRS §§ 560:3-104 ("No proceeding to
enforce a claim against the estate of a decedent or the
decedent's successors may be revived or commenced before the
appointment of a personal representative."), 560:3-617 ("A
special administrator appointed by order of the court in any
formal proceeding has the power of a general personal
representative except as limited in the appointment[.]"), 560:3-715(22) ("[A] personal representative . . . may properly . . .
[p]rosecute or defend claims, or proceedings in any jurisdiction
for the protection of the estate[.]"), and 560:3-804 (providing
that creditors must present their claims to the personal
representative) (Supp. 1997). Accordingly, we hold, as a general rule, that an heir
of an undistributed estate, who has not been judicially appointed
as the personal representative of a decedent's estate, is not a
"proper party" for substitution pursuant to HRCP Rule 25(a)(1).(18) 3. Imelda is judicially estopped from attempting to
renounce her prior disingenuous position regarding her legal
status, argued to and accepted by the circuit court, and,
therefore, has constructively consented to personal
liability for the judgment against the Marcos Estate to the
extent of her share of the estate's assets. The plaintiffs-appellees alternatively argue that, even
if Imelda's status as Ferdinand's widow is insufficient in itself
to justify her substitution pursuant to HRCP Rule 25, the fact
that she stipulated to the substitution should operate to estop
her from claiming that the Marcos Estate was not properly
substituted as a party defendant. Clearly, Imelda could not
unilaterally appoint herself the personal representative of the
Marcos Estate merely by way of stipulation with another party,
see HRS 560:3-103 (Supp. 1997) (providing that personal
representatives are "appointed by order of the court or
registrar"); neither could the circuit court's acceptance of the
parties' stipulation constitute an order of the probate court
appointing Imelda as personal representative of the estate. Nevertheless, this court cannot and need not blind itself to
the deception Imelda has obviously attempted to perpetuate upon
the court in this case. As she conceded at oral argument, Imelda
herself drafted the March 17, 1992 stipulation for substitution
and has employed the same language with respect to stipulations
entered into in lawsuits in other jurisdictions. The stipulation
is cleverly worded to avoid the use of the terms "personal
representative" and "Estate of Ferdinand Marcos." See supra
section I.B.2. The lack of these terms, however, does not alter
the obvious purpose of the document -- to substitute Imelda as
the "proper party" to defend the lawsuit on behalf of her
deceased husband. Imelda also concedes that she was fully aware that she
had not, as of the time she entered into the stipulation, been
appointed executrix of Ferdinand's will. However, she maintains
that she entered into the stipulation because "it was believed
that, as surviving spouse and heir of the decedent, [she] would
eventually be appointed personal representative" and that, after
her attempt to achieve this end was initially thwarted in the
Philippine probate proceeding, she promptly informed the circuit
court and the other parties. However, the "morphing" quality of
Imelda's characterizations of her own conduct and motives belies
her alleged good intentions. Imelda appears first to have proposed the concept of
substituting herself for Ferdinand in a letter dated February 14,
1991, signed by her counsel and addressed to counsel for
plaintiffs-appellees. That letter, a copy of which Imelda
apparently sent to the motions judge, proposed in relevant part: As you know, the will of Ferdinand Marcos named his widow,
Imelda Marcos[,] as one of the personal representatives of the
estate. Pursuant to Haw. R. Civ. P. 25, we hereby offer to stipulate
to the substitution of Mrs. Marcos in this action as the
representative of the Ferdinand Marcos Estate. Enclosed is an
executed stipulation making the substitution. If the form is
satisfactory to you, you are authorized to file it with the Court. (Emphasis added.) When the plaintiffs-appellees later moved to substitute
Irene Silverman as personal representative of the Marcos Estate,
"on the grounds that . . . it is necessary to add the judicially-appointed personal representative of his estate," Imelda's
counsel opposed the motion, arguing that "[t]here is a proper
Rule 25 Substitution of Party. All defendants who have appeared
in this case . . . have been substituted where appropriate . . .
and there is no logical or legal basis to appoint a personal
representative." The circuit court expressly relied on Imelda's
argument -- which is the diametric opposite of that offered by
Imelda on appeal -- as the basis for denying the plaintiffs-appellees' motion. Imelda did not dispute the plaintiffs-appellees' representation to the circuit court that her counsel
had signed no less than forty documents already filed with the
court, which characterized Imelda as the "representative" of the
Marcos Estate. Imelda's counsel first began to backpedal from his
position that Imelda was the Marcos Estate's "representative" in
his memorandum in opposition to the plaintiffs-appellees' second
motion to substitute Silverman, see supra section I.B.2,
simultaneously maintaining that he (1) "continued to represent
Imelda . . . , individually and in her capacity as the agreed
upon representative of the defendant Ferdinand," (2) did not and
never had "represented any judicially appointed personal
representative of the [Marcos Estate]" in the present or any
other litigation, (3) expressed no view as to whether the March
17, 1992 stipulation bound the Marcos Estate in any way with
respect to any judgment that might be entered against it, and (4)
took no "position on the necessity of adding a judicially
appointed representative of the [Marcos Estate] for purposes of
this litigation." At the same time, Imelda's counsel insisted
that "Irene Silverman should not be substituted in this action as
the personal representative of the [Marcos] Estate." As the trial progressed, Imelda's counsel made
continued references to her representative capacity with regard
to her deceased spouse and to Ferdinand's status as a defendant
in the litigation. During jury selection, Imelda's counsel
declared to the potential jurors that he represented Ferdinand
Marcos in the action "just . . . as if [he] was [sic] alive,"
despite the fact that the Marcos Estate had "never been joined."
Further, during the settlement of jury instructions, Imelda's
counsel insisted that Ferdinand's name be read first to the
jurors before Imelda's when describing the defendants. Imelda has never attempted to explain how it is
conceptually possible for her to have represented "Ferdinand E.
Marcos, deceased" in this litigation without representing his
estate pursuant to HRCP Rule 25. As Imelda herself concedes,
Ferdinand ceased to be a party upon his death, and, therefore,
could only be "present" in the litigation through a
representative of his estate. See Bagalay, 60 Haw. at 135, 588
P.2d at 423 ("A deceased person cannot be a party to a legal
proceeding, and the effect of death is to suspend the action as
to the decedent until his legal representative is substituted as
a party.") Moreover, Imelda never moved to set aside her
stipulated substitution as the "proper party" to succeed
Ferdinand as a party defendant or for summary judgment on the
basis that her substitution was improper, deliberately choosing,
instead, to persist in the defense of the case against Ferdinand.
In Rosa v. CWJ Contractors, Ltd., 4 Haw. App. 210, 664 P.2d 745
(1983), the Intermediate Court of Appeals (ICA) was confronted
with a party advancing a similarly shifting set of contentions.
In that case, the plaintiffs had obtained a judgment against CWJ
Corporation, Ltd. (Corporation). Id. at 211-12, 664 P.2d at 747.
Subsequently, the plaintiffs sued CWJ Contractors, Ltd.
(Contractors), alleging the same facts and asserting a number of
the same claims previously directed against Corporation.
Contractors moved to dismiss two of the counts, invoking res
judicata as a defense. Id. at 212, 664 P.2d at 748. The
plaintiffs successfully opposed the motion, arguing that res
judicata did not apply because Contractors and Corporation were
distinct entities and Contractors was not a party to the first
lawsuit. Id. at 218, 664 P.2d at 751. Subsequently, the
plaintiffs filed a successful motion for summary judgment,
wielding res judicata offensively against Contractors and arguing
that Contractors was a wholly-owned subsidiary of Corporation and
was in privity with it. Id. The ICA held that the plaintiffs
were precluded, by virtue of the doctrine of "judicial estoppel,"
from prevailing on the basis of two mutually exclusive positions
regarding the relationship between Contractors and Corporation.
Id. at 220, 664 P.2d at 749. Pursuant to the doctrine of judicial estoppel, [a] party will not be permitted to maintain inconsistent positions or
to take a position in regard to a matter which is directly contrary to,
or inconsistent with, one previously assumed by him, at least
where he had, or was chargeable with, full knowledge of the facts,
and another will be prejudiced by his action. Id. at 218, 664 P.2d at 751 (quoting 28 Am.Jur.2d Estoppel and
Waiver § 68, at 694-95 (1966) (indentation omitted)). Judicial
estoppel "'partakes . . . of positive rules of procedure based on
manifest justice and, to a greater or less[er] degree, on
considerations of the orderliness, regularity, and expedition of
litigation.'" Id. at 219, 664 P.2d at 751 (quoting Trask v. Tam
See, 42 Haw. 324, 333 (1958)). This doctrine prevents parties
from "playing 'fast and loose' with the court or blowing 'hot and
cold' during the course of litigation." Id. (citing Godoy v.
Hawaii County, 44 Haw. 312, 354 P.2d 78 (1960); see also Yuen v.
London Guar. & Accident Co., Ltd., 40 Haw. 213 (1953); Allen v.
Zurich Ins. Co., 667 F.2d 1162 (4th Cir. 1982); Edwards v. Aetna
Life Ins. Co., 690 F.2d 595 (6th Cir. 1982)). By means of her stipulation in this case, Imelda
accepted the benefit of maintaining full control over the defense
of the Marcos Estate, in which she had a substantial interest.
Now that the plaintiffs-appellees have prevailed against the
estate, Imelda argues that she was without authority to act as
she did in proffering and entering into the stipulation. In
other words, she now claims that because of her wrongful act of
holding herself out as a proper party for substitution, the
plaintiffs-appellees should now be stripped entirely of their
judgment.(19) The Arizona Supreme Court rejected a similar argument
in Jasper v. Batt, 264 P.2d 409 (Ariz. 1953). In Jasper, the
plaintiffs sued in an Arizona state court for injuries arising
out of an automobile accident. Id. at 410. After the defendant
died during the pendency of the litigation, the plaintiffs
stipulated with the widow, who had been named executrix of
defendant's will by a California court, to substitute her name as
defendant in the lawsuit. Id. No ancillary probate proceedings
were ever initiated in Arizona. Id. After a jury trial, the
executrix prevailed. Id. On appeal, the plaintiffs argued that
the trial court lacked jurisdiction to enter judgment in favor of
the executrix, inasmuch as she was never appointed by an Arizona
court as the representative of her husband's estate. Id. at 411. The Jasper court held that "[t]he court had
jurisdiction to try and determine the case as originally
instituted, and the court had the jurisdiction and power to
proceed with the case when there was brought before it one who
was represented by both parties as having the authority to
represent the estate." Id. at 412. The court further held that
the plaintiffs were bound by their stipulation because they had
failed, pursuant to Arizona Rules of Civil Procedure Rule 9(a),(20)
to "negatively aver" that the executrix lacked the requisite
authority "to be sued in a representative capacity." Id. In
response to the plaintiffs' argument that, "had they been
successful, their judgment would have been void and not a valid
claim against the Arizona estate," the court noted that [w]e do not decide this question as to parties not before the court
who might have an interest in the estate. We do hold, however,
that all parties to the litigation, so far as their personal interests are
concerned, waived any question as to authority and were bound by
the result. [The executrix,] having by stipulation represented [that]
she had authority to appear and defend the action on behalf of the
Arizona estate, had equally with the plaintiffs waived her right to
question the untruthfulness of such representation. Id. (emphasis added) (indentation omitted).(21) We deem the Jasper court's analysis to be instructive,
although we rely upon the doctrine of judicial estoppel to reach
the same result. Parties should not be permitted to abuse the
mechanism of substitution of parties by stipulation to derive
unfair advantage on appeal when the judgment in the trial court
is unfavorable or not otherwise to their liking. Accordingly,
insofar as Imelda's "personal interests" are concerned, we hold
that she has waived any question as to her own authority and is
personally bound by the judgment in this case. However, as
discussed supra in section III.A.2, no matter how unfair Imelda's
action may be, she nevertheless lacked the legal authority to
bind the Marcos Estate. Thus, we may, for our own purposes,
answer the question left unaddressed by the Jasper court's
holding -- the Marcos Estate was not bound by Imelda's
stipulation. To clarify what we mean by Imelda's "personal
interests," we turn to fundamental principles of equity, from
which the doctrine of judicial estoppel derives. One of the glories of equity jurisprudence is that it is not bound by
the strict rules of the common law, but can mold its decrees to do
justice amid all the vicissitudes and intricacies of life. The
principles upon which it proceeds are eternal; but their application
in a changing world will necessarily change to meet changed
situations. We hold the court of equity has plenary power to mold
its decrees in such form as to conserve the equities of all parties[.] Fleming v. Napili Kai, Ltd., 50 Haw. 66, 70, 430 P.2d 316, 319,
reh'g denied, 50 Haw. 83, 431 P.2d 299 (1967) (citation and
internal quotation signals omitted). In other words, "'[t]he
relief granted in equity is dictated by the equitable
requirements of the situation, and must be adapted to the facts
and circumstances of the particular case.'" Almeida v. Almeida,
4 Haw. App. 513, 523, 669 P.2d 174, 182 (1983) (quoting Shinn v.
Edwin Yee, Ltd., 57 Haw. 215, 235, 553 P.2d 733, 746 (1976)).
See also Food Pantry v. Waikiki Business Plaza, Inc., 58 Haw.
606, 614, 575 P.2d 869, 876 (1978). Moreover, "'equity will not
permit a wrong to be without remedy.'" Meheula v. Hausten, 29
Haw. 304, 313 (1926). Due in large part to the circuit court's reliance on
Imelda's arguments regarding the propriety of her substitution as
a party defendant for Ferdinand, the plaintiffs-appellees have
obtained a judgment that cannot be enforced against the Marcos
Estate. Simply "estopping" Imelda from claiming that the estate
is not bound, when in fact the plaintiffs-appellees cannot
collect their judgment from the estate, offers the plaintiffs-appellees no relief from Imelda's wrongdoing. At the same time,
it is clear that Imelda fully defended her interests in the
estate by vigorously contesting the merits of the plaintiffs-appellees' case against her late husband through the services of
the same counsel employed by Ferdinand for the same purpose while
he was alive. Therefore, in order to achieve manifest justice
consistent with the doctrine of judicial estoppel, the equities
of this case require us to hold Imelda personally liable, at
least to the extent of her interest in the assets of the Marcos
Estate, for the amount of the plaintiffs-appellees' judgment
against Ferdinand, as that amount has been modified according to
this opinion, see generally infra.(22) Accordingly, we vacate the portion of the circuit
court's amended judgment entered against "Defendant Imelda
Marcos, as Personal Representative of the Estate of Ferdinand
Marcos" with respect to the plaintiffs-appellees' battery, false
imprisonment, and conversion claims and remand for entry of
judgment as to those claims against Imelda, in her personal
capacity, to the extent of her interest in the Marcos Estate. B. The Statute Of Limitations Was Tolled During The Period
Of Ferdinand's Constitutional Immunity From Suit. Imelda contends that Roxas's claims for relief sounding
in battery and false imprisonment, as well as GBC's claim of
conversion, were barred by operation of the relevant statutes of
limitations. She points out that the instant lawsuit was not
filed until seventeen years after the golden buddha was allegedly
confiscated, fourteen years after Roxas was last allegedly
assaulted, and twelve to thirteen years after the remaining
treasure was allegedly recovered from the tunnel near the Baguio
General Hospital. HRS § 657-9 (1993) provides that [w]hen a cause of action has arisen in any foreign jurisdiction, and by the
laws thereof an action thereon cannot there be maintained against a person,
by reason of the lapse of time, an action thereon shall not be maintained
against the person in this State, except in favor of a domiciled resident
thereof, who has held the cause of action from the time it accrued. Thus, by its terms, HRS § 657-9 requires that the plaintiffs-appellees' claims for relief must have been brought in compliance
with the time constraints imposed by any applicable Philippine
statute of limitations. The parties do not dispute that Imelda adequately
established that the relevant time period mandated by the statute
of limitations for false imprisonment and battery, pursuant to
Article 1146 of Philippine Civil Code, is two years, and, for
conversion, pursuant to Article 1140 of the Philippine Civil
Code, four years. The jury was instructed regarding these
statutes of limitations. However, the jury was also instructed,
without objection, that "[t]he statute of limitations has been
devised to operate primarily against those who slept on their
rights and not against those desireous to act but who cannot do
so for causes beyond their control." The latter instruction was
a direct quotation from Republic of the Philippines v. The Court
of Appeals, 137 SCRA 220, 228 (1985) (de Vera), an authority
supplied to the circuit court by the plaintiffs-appellees. In
addition, the jury was instructed -- in this instance, over
Imelda's objection -- that "[t]he time for filing a lawsuit does
not begin to run on plaintiff if it was impossible or virtually
impossible for Roger Roxas to file a lawsuit. The statute of
limitations only begins to run from the date that the lawsuit
could be filed." In their closing argument, the plaintiffs-appellees
urged that the relevant statutes of limitations were tolled in
the present case because Ferdinand, while still in power, (1) had
engineered an amendment to the Philippine Constitution making him
immune from lawsuit during his term of office and (2) had so
threatened Roxas that he had justifiably feared challenging
Marcos in court. On appeal, Imelda argues that (1) Hawai`i
should not recognize duress as a defense to the statute of
limitations, citing cases from a number of state and federal
jurisdictions, and (2) Ferdinand was not immune from lawsuits
unrelated to his official acts. Inasmuch as we disagree with
Imelda's latter argument, we need not reach the former.(23) In de Vera, the issue before the Philippine Supreme
Court was whether a trial court's issuance of an alias writ of
execution of a prior judgment was barred by the statute of
limitations, inasmuch as the judgment had become final more than
five years before. de Vera, 137 SCRA at 227. The Republic had
sued Mercy and Juan de Vera (collectively, the de Veras) for back
rent for an apartment the de Veras rented in a building owned by
the state. Id. at 222. The Republic prevailed, and a judgment
was filed in its favor on May 18, 1961. Id. at 223. The de
Veras appealed the judgment, but, by decision filed on August 27,
1968, the Republic prevailed in the Court of Appeals. On April
15, 1969, the Republic filed its first motion for the execution
of the trial court's judgment. Id. The motion was granted by an
order filed on April 17, 1969. However, the de Veras appealed
the order on the ground that service of the Republic's motion had
been insufficient. Id. at 224. Pending the appeal, the trial
court recalled the writ of execution. Id. at 225. The Republic
again prevailed on appeal and filed a motion for the issuance of
an alias writ of execution on January 25, 1974. Id. The de
Veras opposed the motion, but the trial court granted it in an
order filed on July 12, 1974. Id. at 226. The de Veras moved to quash the writ, but the trial
court refused to do so. Id. at 226. The de Veras then appealed
to the Court of Appeals, where they prevailed. Id. In response
to the petition for a writ of certiorari filed by the Republic in
the Philippines Supreme Court, the de Veras argued that the
Republic's motion for the alias writ of execution was time-barred
because Rule 39, Section 6 of the Revised Rules of Court provided
that "a judgment may be executed on motion within five (5) years
from the date of its entry or from the date it became final[.]"
Id. at 227. The Philippines Supreme Court held that the statute of
limitations had been tolled because the de Veras had, by their
own actions, caused the delay in filing the writ. Id. at 228.
Accordingly, the Supreme Court reversed the decision of the Court
of Appeals. As noted above, the de Vera court also expressly
held that the statue of limitations does not apply to "those
desirous to act but [who] cannot do so for causes beyond their
control." Thus, pursuant to de Vera, (1) if a party, through her
own actions, causes a delay resulting in her opponent's inability
to comply with the statute of limitations in a timely fashion or
(2) if it is otherwise impossible for a party to comply with the
statute of limitations, then (3) the statute of limitations is
tolled under Philippine law. It is manifestly apparent in this case that it would
have been impossible for Roxas to file a lawsuit in the
Philippines, which asserted the claims for relief at issue
herein, during the Marcos regime. Article VII, § 7 of the 1973
Philippines Constitution (adopted through Ferdinand's
instrumentality) provided as follows: "The President shall be
immune from suit during his tenure." In 1981, when the
constitution was further amended and the relevant section was
renumbered, the following language was added: "Thereafter, no
suit whatsoever shall lie for official acts done by him or by
others pursuant to his specific orders during his tenure. The
immunities provided herein shall apply to the incumbent President
referred to in Article XVII of this Constitution." Phil. Const.
art. VII, § 15 (1981).(24) Imelda argues that the foregoing constitutional
language stands only for the proposition that, as president,
Ferdinand was immune from suit for his official acts. She points
out that, in response to her defenses of "head of state" and "act
of state" immunity (see discussion infra), the plaintiffs-appellees have argued that Ferdinand's alleged acts of
appropriating the gold and causing Roxas to be unlawfully
detained and tortured were not "official." However, she cites no
Philippine legal authority to support her reading of the
constitution. Absent case law construing the relevant provision, this
court is left only with the plain language of the constitution
itself. Nothing in the plain language of article VII, § 7 of the
1973 constitution supports the proposition that its scope was
restricted to lawsuits predicated on "official acts," as Imelda
suggests. Rather, the more literal sense of the section is that
it absolutely barred all lawsuits filed against the president
while he held that office. Our interpretation is only fortified
by the 1981 amendment, which clarified that, even after his
tenure as president, Ferdinand would not be subject to lawsuits
based on his official acts. Pursuant to the rule of statutory
construction denominated expressio unius est exclusio alterius --
the express inclusion of a provision implies the exclusion of
another --, Ferdinand would have been subject to suit only for
his "non-official acts" once his presidential term had ended.
See Fought & Company v. Steel Eng'g and Erection, Inc., 87
Hawai`i 37, 55, 951 P.2d 487, 505 (1998); Keliipuleole v. Wilson,
85 Hawai`i 217, 227, 941 P.2d 300, 310 (1997); State v. Cornelio,
84 Hawai`i 476, 495 n.33, 935 P.2d 1021, 1040 n.33 (1997); Arceo,
84 Hawai`i at 29 n.38, 928 P.2d at 871 n.38; International Sav.
and Loan Ass'n v. Wiig, 82 Hawai`i 197, 200, 921 P.2d 117, 120
(1996). Accordingly, it is clear that Roxas would have been
unable to bring any lawsuit against Ferdinand in the Philippines
so long as Ferdinand remained in power. Thus, pursuant to de
Vera, the statutes of limitations were tolled as a matter of law
until the collapse of Ferdinand's regime. The record indicates
that Ferdinand's presidency effectively ended on the date he was
brought to Hawai`i -- February 25, 1986. The instant lawsuit was
filed on February 19, 1988, within the two-year Philippines
statute of limitations relating to battery and false imprisonment
(i.e., Article 1146) and the four-year Phillippines statute of
limitations relating to conversion (i.e., Article 1140).
Imelda's statute of limitations defense therefore fails. C. The Plaintiffs-Appellees' Lawsuit Was Not Barred By The
Act Of State Doctrine. Imelda next argues that the plaintiffs-appellees'
claims were barred by the "act of state" doctrine.(25) Pursuant to
the act of state doctrine, a court will not review the actions of
a foreign sovereign because [e]very sovereign State is bound to respect the independence of every
other sovereign State, and the courts of one country will not sit in
judgment on the acts of the government of another done within its own
territory. Redress of grievances by reason of such acts must be obtained
through the means open to be availed of by sovereign powers as between
themselves. Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398, 416 (1964)
(quoting Underhill v. Hernandez, 168 U.S. 250, 252 (1897)).
Although earlier decisions described the doctrine in terms of
international comity, in Sabbatino, the United States Supreme
Court made clear that the act of state doctrine is not merely a
function of comity, but a restriction on federal courts emanating
from the structure of the United States Constitution itself: The text of the Constitution does not require the act of state doctrine; it
does not irrevocably remove from the judiciary the capacity to review the
validity of foreign acts of state. The act of state doctrine does, however, have "constitutional"
underpinnings. It arises out of the basic relationships between branches of
government in a system of separation of powers. It concerns the
competency of dissimilar institutions to make and implement particular
kinds of decisions in the area of international relations. The doctrine as
formulated in past decisions expresses the strong sense of the Judicial
Branch that its engagement in the task of passing on the validity of foreign
acts of state may hinder rather than further this country's pursuit of goals
both for itself and for the community of nations as a whole in the
international sphere. 376 U.S. at 423. See also W.S. Kirkpatrick & Co. v.
Environmental Tectonics Corp., Int'l, 493 U.S. 400, 404 (1990)
("This Court's description of the jurisprudential foundation for
the act of state doctrine has undergone some evolution over the
years. We once viewed the doctrine as an expression of
international law . . . . We have more recently described it,
however, as a consequence of domestic separation of powers[.]"
(citing, inter alia, Sabbatino)). Despite the fact that it
justified the act of state doctrine on the basis of the
separation of powers among the federal branches of government,
the Sabbatino court also clarified that the doctrine is binding
on state courts as well, as an "exclusive[] . . . aspect of
federal law." Sabbatino, 376 U.S. at 424-26. Imelda contends that the act of state doctrine covers
any "governmental" act by a foreign official, regardless of the
act's illegality under international or local law. She
interprets a number of Supreme Court and other older federal
appellate decisions to support her position. See, e.g.,
Sabbatino, 376 U.S. at 431 ("the act of state doctrine is
applicable even if international law has been violated");
American Banana v. United Fruit Co., 213 U.S. 347 (1909) (act of
state doctrine barred judicial inquiry into seizure of plantation
by Costa Rican soldiers allegedly acting at the behest of the
defendant company); Oetjen v. Central Leather Co., 246 U.S. 297
(1918) (act of state doctrine barred inquiry into the Mexican
government's confiscation of leather hides); Ricaud v. American
Metal Co., 246 U.S. 304 (1918) (act of state doctrine barred
judicial inquiry into the Mexican government's confiscation of
lead bullion); Bernstein v. Van Hegghen Freres Societe Anonyme,
163 F.2d 246 (2d Cir.) (act of state doctrine barred judicial
inquiry into false imprisonment and conversion under Nazi anti-Jewish laws), cert. denied, 332 U.S. 772 (1947). Imelda fails, however, to cite Republic of the
Philippines v. Marcos, 862 F.2d 1355 (9th Cir. 1988) (en banc),
cert. denied, 490 U.S. 1035 (1989) (Republic II).(26) In that
case, the Republic sued the Marcoses, alleging that they had
stolen public and private Philippine money and arranged for it to
be transferred out of the Philippines. Republic II, 862 F.2d at
1358-59. The Marcoses asserted the act of state doctrine as a
defense. In its initial opinion on appeal, the Ninth Circuit,
sitting as a panel of three judges, sided with the Marcoses,
holding that the act of state doctrine barred the lawsuit. See
Republic of the Philippines v. Marcos, 818 F.2d 1473 (9th Cir.
1987). However, on rehearing en banc, the Ninth Circuit reversed
itself. Republic II, 862 F.2d at 1360-61. The court noted that,
in Sabbatino, the United States Supreme Court had tempered the
act of state doctrine with regard to officials who were no longer
in power at the time of the filing of the lawsuit in question.
Id. at 1360. The Sabbatino Court had observed that, in deciding
whether the act of state doctrine applied, "[t]he balance of
relevant considerations may also be shifted if the government
which perpetrated the challenged act is no longer in existence . . . for the political interest of this country may, as a
result, be measurably altered." Sabbatino, 376 U.S. at 428.
Interpreting the foregoing language, the Ninth Circuit held that, [o]nce deposed, the dictator will find it difficult to deploy the defense
successfully. . . . A fortiori, when a ruler's former domain has turned
against him and seeks the recovery of what it claims he has stolen, the
classification has little or no applicability. The act of state doctrine is
supple, flexible, ad hoc. The doctrine is meant to facilitate the foreign
relations of the United States, not to furnish the equivalent of sovereign
immunity to a deposed leader. Republic II, 862 F.2d at 1360-61. The Republic II court further
noted that, in Alfred Dunhill of London Inc. v. Republic of Cuba,
425 U.S. 682 (1976), the United States Supreme Court had held
that the burden of proving that the acts in question were "acts
of state," (i.e., "facts . . . sufficient to demonstrate that the
conduct in question was the public act of those with authority to
exercise sovereign powers," id. at 694 (emphasis added)) rests on
the defendants. Republic II, 862 F.2d at 1361. See also Clayco
Petroleum Corp. v. Occidental Petroleum Corp., 712 F.2d 404, 406
(9th Cir. 1983) ("[W]ithout sovereign activity effectuating
'public' rather than private interests, the act of state doctrine
does not apply."), cert. denied, 464 U.S. 1040 (1984). The United States Court of Appeals for the Second
Circuit came to a similar conclusion in a lawsuit brought by the
Republic against the Marcoses and some of their holding
companies, which sought an injunction barring the defendants from
transferring or encumbering properties allegedly purchased in New
York with monies wrongfully taken from the Philippines. See
Republic of the Philippines v. Marcos, 806 F.2d 344 (2d Cir.
1986), cert. denied sub nom New York Land Co. v. Republic of the
Philippines, 481 U.S. 1048 (1987) (Republic I).(27) The Republic I
court described its rejection of Marcos's act of state defense in
the following terms: Appellants simply fail to make the crucial distinction between acts of
Marcos as head of state, which may be protected from judicial scrutiny
even if illegal under Philippine law, and his purely private acts. Although
the distinction between public and private acts of a foreign official may be
difficult to determine, our courts have repeatedly done so. Id. at 359 (citations omitted). In this connection, the Republic
I court also observed that the fact of Ferdinand's involuntary
ouster greatly lessened the danger of the court encroaching upon
the prerogatives of the federal executive: [T]he Marcos government is no longer in power. Thus, the danger of
interference with the Executive's conduct of foreign policy is surely much
less than the typical case where the act of state is that of the foreign
government. . . . Thus, before the doctrine is applied even to Marcos's
public acts, the court must weigh in balance the foreign policy interests
that favor or disfavor application of the act of state doctrine. Id. (citations omitted). Similarly, in addressing Manuel Noriega's appeal from
his conviction of drug-related offenses, the United States
District Court for the Southern District of Florida emphasized
that not all acts of a head of state are public acts: The fact that Noriega is alleged to have utilized his official position to
engage in criminal activity does not, as Defendant suggests, cast his
actions in a public light; as we well know, government officials are as
capable of exploiting their positions of power for private, selfish ends as
they are for [a] public purpose. The inquiry is not whether Noriega used
his official position to engage in the challenged acts, but whether those
acts were taken on behalf of Noriega instead of Panama. United States v. Noriega, 746 F. Supp. 1506, 1522 (S.D. Fla.
1990), aff'd, 117 F.3d 1206 (1997), cert. denied, 118 S. Ct. 1389
(1998) (emphasis added). See also Jimenez v. Aristeguieta, 311
F.2d 547, 557-58 (5th Cir. 1962) ("Appellant's acts constituting
the financial crimes . . . were not acts of Venezuela sovereignty
. . . . [E]ach of these acts was for the private financial
benefit of the appellant. They constituted common crimes
committed by the Chief of State in violation of his position and
not in pursuance of it. They are as far from being an act of
state as rape." (Internal quotation marks omitted.)), cert.
denied, 373 U.S. 914 (1963). In the present matter, Roxas alleged that Ferdinand
detained and tortured him in order to ascertain the location of
the Yamashita treasure and that Ferdinand had converted the
golden buddha and the rest of the treasure for his own "private,
selfish ends." Thus, this case, as Roxas cast it, is
distinguishable from Sabbatino, Oetjen, and Ricaud, in which
revolutionary governments appropriated private property for
public use. Imelda, on the other hand, emphasizes that [t]he evidence at trial established that the treasure allegedly confiscated by
Marcos was supposedly discovered on government property, that the
government by law owned a substantial interest in the treasure, that Roxas
concealed the treasure in his home for months without reporting his
discovery to any government official, that he thereafter sold a portion of
the treasure and attempted to locate a buyer for the rest of it without the
government's knowledge or consent, and that after learning about the
existence of the alleged treasure, the police confiscated it pursuant to a
search warrant issue by a Philippine court. The evidence further
established that Roxas was charged, tried, convicted, sentenced, and
imprisoned by a Philippine court for illegal possession of a firearm. Assuming, arguendo, that Imelda's characterization of
what the evidence at trial "established" is accurate, she has
nevertheless failed to meet her burden of demonstrating that
Marcos's acts were acts of state (i.e., public acts). First, the
testimony of Olsson, Doel, and O'Brien regarding (1) the storage
of gold in Ferdinand's "summer palace" and at the Malacanang and
(2) Ferdinand's surreptitious attempts to sell it, combined with
(3) Hirschfield's testimony regarding Ferdinand's post-presidential attempts to use the gold as security for a personal
loan, was sufficient for the circuit court to reasonably infer,
as a threshold evidentiary matter, that Ferdinand had converted
the treasure strictly for his benefit, rather than for that of
the state. Thus, although evidence that the state had some
legitimate interest in the gold supported Imelda's position, the
circuit court could rationally have been persuaded that Ferdinand
never had any intention of turning the gold over to the state. Further, although the evidence showed that Roxas was
tried for and convicted of a crime in a Philippine court, it also
showed that he was repeatedly detained and tortured before any
trial ever took place. During these detentions, he was
interrogated about the Yamashita treasure -- a subject having
nothing to do with his alleged possession of a firearm. Roxas's
testimony also indicated that, while he was imprisoned by the
civil authorities after his conviction on the firearm charges, he
was periodically removed for further questioning and beatings by
military personnel in connection with his discovery of the
treasure. The circuit court could reasonably have inferred that
his detention and torture were carried out at Ferdinand's
personal command and effectuated in order for Ferdinand
personally to appropriate the treasure. Accordingly, although
there was conflicting evidence, the circuit court's implied
finding that Ferdinand's acts were of a personal rather than
public nature was not clearly erroneous. Moreover, as noted by
the Republic I and Republic II courts, Marcos's status as a
deposed dictator appears to have greatly lessened any potentially
adverse foreign policy impact that this case might have. Finally, we are aware that Congress has expressly
exempted confiscations of personal property that are illegal
under international law from the scope of the act of state
doctrine. See 22 U.S.C.A. § 2370(e)(2) (1990).(28) This
provision, variously referred to in the case law as the
"Sabbatino amendment" and the "Hickenlooper amendment," was
enacted in response to the Supreme Court's decision in Sabbatino.
See West v. Multibanco Comermex, S.A., 807 F.2d 820, 829 (9th
Cir.), cert. denied, 482 U.S. 906 (1987). Despite its
"constitutional underpinnings," the power of Congress to limit
the act of state doctrine has been upheld by virtue of its
peculiarly prudential character. See id. at 829 n.8; Banco
Nacional de Cuba v. Farr, 383 F.2d 166, 178-83 (2d Cir.), cert.
denied, 390 U.S. 956 (1967). Under international law, "[v]alid
expropriations must always serve a public purpose[.]" West, 807
F.2d at 831. In the present case, Ferdinand's expropriation of the
Yamashita treasure and Roxas's attendant detention and torture
were shown to have been carried out for Ferdinand's personal
benefit and were therefore violative of international law. That
being so, we hold that the act of state doctrine is no bar to the
plaintiffs-appellees' claims for relief. D. Because He Had Already Been Deposed When The Present
Lawsuit Was Filed, Ferdinand Was Not Protected By "Head Of State"
Immunity. Imelda asserts that Ferdinand was immune from suit in
Hawai`i by virtue of the "head of state" doctrine. Grounded in customary international law, the doctrine of head of state
immunity provides that a head of state is not subject to the jurisdiction of
foreign courts, at least as to official acts taken during the ruler's term of
office. The rationale behind the doctrine is to promote international
comity and respect among sovereign nations by ensuring that leaders are
free to perform their governmental duties without being subject to
detention, arrest, or embarrassment in a foreign country's legal system. Noriega, 746 F. Supp. at 1519 (citations and footnote omitted).
Imelda asserts that head of state immunity applies equally to
former heads of state, citing Nixon v. Fitzgerald, 457 U.S. 731
(1982) (holding that the United States president has absolute
immunity for acts within the 'outer perimeter' of his official
responsibility), and Hatch v. Baez, 7 Hun. 596, 600 (N.Y. 1876)
(holding that former heads of state retain their immunity). Nixon is clearly inapposite to the instant matter
because the immunity discussed in that case derived from the
constitutional role of the president of the United States within
the construct of separation of powers. See Nixon, 457 U.S. at
753. It is worth noting that the United States Court of Appeals
for the Ninth Circuit has rejected a similar attempt by Marcos,
in connection with a contempt citation entered against him in a
federal lawsuit, to claim protection by analogy to federal
presidential immunity: Marcos' reliance upon [presidential immunity] is misplaced. His status is
hardly comparable to that of a President of the United States. Although
Marcos originally was granted immunity from liability in this case as a
head of state, he is now an alien with no official status who has chosen to
take up his residence in this country. Estate of Domingo v. Republic of the Philippines, 808 F.2d 1349,
1351 (9th Cir. 1987) (Domingo I).(29) The United States District Court for the Western
District of Washington relied in part on the foregoing
characterization to reject Ferdinand's assertion of head of state
immunity, ruling that "[h]ead of state immunity serves to
safeguard the relations among federal governments and their
leaders, not[,] as the Marcoses assert, to protect former heads
of state regardless of their lack of status." Estate of Domingo
v. Republic of the Philippines, 694 F. Supp. 782, 786 (W.D. Wash.
1988), appeal dismissed, 895 F.2d 1416 (9th Cir. 1990) (Domingo
II). In any case, other than the nineteenth century New York
decision cited by Imelda, we have found no other authority that
applies head of state immunity to former heads of state. Modern
authority is to the contrary. As the plaintiffs-appellees have
observed, Ferdinand has repeatedly and unsuccessfully claimed
head of state immunity in various lawsuits around the country.
See, e.g., Domingo II, 694 F. Supp. at 786; In re Mr. and Mrs.
Doe, 860 F.2d 40, 45 (2d Cir. 1988) (holding that any immunity
had been waived by the Republic, but noting that "were we to
reach the merits of the [head of state immunity] issue, we
believe there is respectable authority for denying head-of-state
immunity to a former head of state"); Republic II, 806 F.2d at
360 (also failing to reach the issue directly, but noting that
the court was "not at all certain" that head of state immunity
applied to former heads of state). Accordingly, we hold that Ferdinand is not protected by
head of state immunity. E. Ferdinand Was Subject To The Personal Jurisdiction Of
The Circuit Court. Imelda maintains that it was improper for the circuit
court to exercise personal jurisdiction over Ferdinand because:
(1) the events upon which the plaintiffs-appellees' claims were
based occurred exclusively in the Philippines; (2) Roxas was a
citizen and resident of the Philippines; (3) Ferdinand was a
citizen and resident of the Philippines; (4) Ferdinand's presence
in Hawai`i was due to his involuntary exile from the Philippines,
which was caused by a "unilateral act of the United States
government -- an act tantamount to kidnapping"; (5) Ferdinand
never intended to become a permanent resident of Hawai`i, but,
rather, intended to return to the Philippines; and (6) Ferdinand
transacted no business, committed no tortious act, caused no
injury, and owned no real estate in Hawai`i. The plaintiffs-appellees respond that the issue of
personal jurisdiction is precluded by the doctrine of collateral
estoppel, in light of a purported ruling of the United States
District Court for the District of Hawai`i, which they cite as
Republic of the Philippines v. Marcos, 1986 U.S. Dist. LEXIS
22542. However, the plaintiffs-appellees failed to provide a
certified copy of this apparently unpublished opinion.
Accordingly, they have failed to offer proof of the prior
adjudication of the issue. In any event, Imelda's arguments regarding personal
jurisdiction fail because the Marcoses waived the issue at the
outset of the lawsuit. Their first responsive pleading in this
case was a motion to dismiss the complaint, accompanied by a
motion for a more definite statement, both filed on January 20,
1989. Their motion to dismiss alleged several defects in the
complaint, including insufficiency of service, but did not allege
that the circuit court generally lacked personal jurisdiction
over Marcos. HRCP Rule 12(g) (1996) provides that [a] party who makes a motion under this rule may join with it any other
motions herein provided for and then available to him. If a party makes a
motion under this rule but omits therefrom any defense or objection then
available to him which this rule permits to be raised by motion, he shall
not thereafter make a motion based on the defense or objection so omitted,
except a motion as provided in subsection (h)(2) hereof on any of the
grounds there stated. HRCP Rule 12(h)(1) (1996) provides that [a] defense of lack of jurisdiction over the person, improper venue, or
insufficiency of service of process is waived (A) if omitted from a motion
in the circumstances described in subdivision (g), or (B) if it is neither
made by motion under this rule nor included in a responsive pleading or an
amendment thereof permitted by Rule 15(a) to be made as a matter of
course. (Emphases added.) We therefore hold, notwithstanding that the defense of
lack of personal jurisdiction was asserted in the Marcoses'
answer to the plaintiffs-appellees' complaint, that the Marcoses'
failure to assert it in their motion to dismiss constitutes a
waiver of the issue pursuant to HRCP Rule 12(g) and (h). Even if the issue had not been waived, Imelda's
argument would fail. In order to exercise personal jurisdiction
over a defendant, [d]ue process requires that a nonresident defendant have sufficient
"minimum contacts" with the forum state "such that the maintenance of
the suit does not offend 'traditional notions of fair play and substantial
justice.'" International Shoe Co. v. Washington, 326 U.S. 310, 316, 66
S.Ct. 154, 158, 90 L.Ed. 95 (1945). "'[I]t is essential in each case that
there be some act by which the defendant purposefully avails itself of the
privilege of conducting activities within the forum State, thus invoking the
benefits and protections of its laws.'" Burger King Corp. v. Rudzewicz,
471 U.S. 462, 475, 105 S.Ct. 2174, 2183, 85 L.Ed.2d 528 (1985) (quoting
Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239, 2 L.Ed.2d
1283 (1958)). The determining inquiry is whether "'the defendant's
conduct and connection with the forum State are such that he should
reasonably anticipate being haled into court there.'" Id. at 474, 105 S.Ct.
at 2183 (quoting World-Wide Volkswagen Corp. v. Woodsen, 444 U.S.
286, 297, 100 S.Ct. 559, 567, 62 L.Ed.2d 490 (1980)). There is no
"talismanic jurisdictional formula" and the court weighs each case on its
facts. Id. at 485-86, 105 S.Ct. at 2189 (citation omitted). In re John Doe, born on August 6, 1987, 83 Hawai`i 367, 373, 926
P.2d 1290, 1306 (1996) (quoting Shaw v. North Am. Title Co., 76
Hawai`i 323, 329-30, 876 P.2d 1291, 1297-98 (1994)). It is undisputed that Ferdinand lived in Hawai`i from
February 25, 1986 until his death on September 29, 1989.
Although Imelda alleges that Ferdinand was involuntarily removed
from the Philippines and desired to return there, she does not
allege that he was somehow imprisoned in Hawai`i. In other
words, there is nothing in the record suggesting that, had he
wished, Ferdinand could not have moved somewhere else. Nothing
requires that a person establish Hawai`i as a domicile (i.e.,
move here with the present intention of remaining indefinitely)
in order to purposefully avail himself of this forum. Cf. In re
Estate of Marcos, 88 Hawai`i at 154-55, 963 P.2d 1130-31 (holding
that the Hawai`i circuit court had no jurisdiction over the
probate of Ferdinand's estate, inasmuch as probate jurisdiction
is limited by statute to decedents formerly domiciled in the
state). Pursuant to Imelda's logic, a person could move to
Hawai`i and live here for an indeterminate period of time, so
long as he or she never formed the intent to remain indefinitely,
without ever becoming subject to personal jurisdiction in this
state. This would be absurd. Ferdinand's three-year and seven-month sojourn in
Hawai`i was neither fleeting nor involuntary. Accordingly, he
"availed himself" sufficiently of the forum to be amenable to
suit in this jurisdiction. F. The Circuit Court Did Not Err In Its Preliminary
Determination That The Plaintiffs-Appellees Had Established The
Existence Of Conspiracies Involving Ferdinand and Numerous Others
-- The Objects Of Which Were To Deprive Roxas Of His Discovered
Treasure, Arrest And Torture Him, And Then Launder And Dispose Of
The Treasure -- As The Evidentiary Basis For The Admission Of The
Out-Of-Court Statements Of A Number Of Ferdinand's Subordinates. Imelda contends that the circuit court erred in its
preliminary determination, made pursuant to HRE Rules 104(a) and
803(a)(2)(c), see supra note 1, that the Marcoses were members of
conspiracies to take and dispose of Roxas's property, as well as
to arrest, detain, and torture Roxas. She complains that the
circuit court's ruling opened the door to a "tremendous amount of
hearsay testimony," so great that she was unable to designate
each instance in her brief. Imelda did, however, expressly
identify the following "blatant and prejudicial" examples: [1.] Oihara's statements, as claimed by Roxas[,] that "his
[Oihara's] address [was that] of Dona Josefa Edralin Marcos" and "he
[Oihara] is staying at the house of Dona Josefa.". . . [2.] Judge Marcos' statements, as claimed by Roxas, "He said we
cannot do nothing because the prince -- the prince in Tagalog is principe.
That's prince in English. Principe ordered the confiscation of the buddha"
and in response to counsel's question as to who was the prince, "He said
the President. He said President Marcos." . . . [3.] Statements made by Anita Inga and Rosario Uy, as claimed by
Roxas in response to his question inquiring on whose behalf they are
negotiating, "who according to them, the name is Dona Josefa Edralin
Marcos. That is the -- that is the -- told me that words and they even give
me a phone number of that Dona Josefa." . . . . "Next, we receive a long
distance from Rosario Uy telling me that I'm not afraid because President
Marcos is the one will pay -- will pay me." . . . . . "That I'm not afraid
because the President will -- is the one who will pay me." . . . [4.] The statement allegedly made by the men who arrested him in
Cabantuan City on or about May 18, 1971, as claimed by Roxas, "They
told me to go with them to make a negotiation to the President." "You
follow me, according to them. Don't be afraid. We are under Malacanang
-- you know, we are under Malacanang agent. We can make a negotiation
to the President, and nothing more." . . . . "They said that they are from
Malacanang, and I believe them because they have a gun." . . . [5.] Statements allegedly made by Colonel Olivas, as claimed by
Roxas, in response to Roxas' inquiry as to why he is being punched in the
stomach, "You're mentioning the name of the President, according to
him." . . . . Further, the statement of another unidentified person present at
the time of the above statement, "We must report to the President that
Rogelio Roxas is in our custody." . . . [6.] Further statements allegedly made by Colonel Olivas while he
was talking on the telephone, as claimed by Roxas, "I want to talk to boss
-- to the boss. And then maybe the other side said the boss is sick, you
know. He is not doing well. He said -- he said to the boss that Rogelio
Roxas -- we captured this Rogelio Roxas. And then after a few second,
there is a -- he said Mr. President, yes. Maybe something like that. Mr.
President, we captured Rogelio Roxas." . . . [7.] Statements allegedly made by two men who visited Roxas in
his shop in December 1974, as claimed by Roxas, "As I understand, they
are belong to those groups who are digging at the back of the hospital.
The military. They are belong to the Task Force Restoration." . . . . "They
address is Malacanang Palace, is Malacanang." "First we only talking
about tunnel, about my experience. And after several visit in my house --
in my shop, I mean, I'm sorry -- they reveal that they belong to the
excavation in the back of the hospital. And they ask me if I can help them
because I have a lot of past experience about the diggings." . . . [8.] Statements allegedly made by Doming Clemente during the
1983 gold negotiations, as claimed by John Doel[:] "He at all times and
immediately confirmed and referred to as 'these items belonged to code
one.' We talked frequently in codes. It was a stipulation and instruction
that Doming said was established by the palace." "He identified code one
as the President." "The owner of the gold, as advised and confirmed
frequently, was code one, President Ferdinand Marcos." "Clemente always
arrived with the reference, 'I have received instructions. I have received
instructions from the palace. I have just come from the palace."
"Occasionally, he confirmed that his instructions came directly from the
President." . . . . "He frequently stated that the items, these items, these
pieces were stored in Baguio, Baguio City. He said these were -- These
items were war booty items. They had been buried in tunnels behind the
hospital in Baguio City. . . . Doel further testified Clemente offered to sell
him a "one tonne" buddha from "Baguio" on "account of the principal,
code one." Imelda further argues that there was no evidence of conspiracy
among Ferdinand and Oihara, Uy, Igna, Clemente, the various
individuals who arrested Roxas in Cabantuan City, and Judge Pio
Marcos. In this connection, Imelda urges that we adopt the rule
of the United States Court of Appeals for the Ninth Circuit,
interpreting of Federal Rules of Evidence Rule (FRE)
801(d)(2)(E)(30) that "a co-conspirator's out-of-court statement,
standing alone, is insufficient to establish that the defendant
had knowledge of and participated in a particular conspiracy."
United States v. Silverman, 861 F.2d 571, 577 (9th Cir. 1988).
The Silverman court tempered its rule as follows: [W]hen the proponent of the co-conspirator's statement offers no
additional proof of defendant's knowledge of and participation in the
conspiracy, the statement must be excluded from evidence. Where, on the
other hand, some additional proof is offered, the court must determine
whether such proof, viewed in light of the co-conspirator's statement
itself, demonstrates by a preponderance of the evidence that defendant
knew of and participated in the conspiracy. Id. at 578 (emphasis in original). Even if this court were to adopt the Silverman rule for
its analysis of HRE Rule 803(a)(2)(C), the requirements of the
rule would be satisfied in the present case. As the plaintiffs-appellees pointed out to the circuit court, a number of
witnesses, including Curtis, Jonsson, and Doel, testified that
they had personally seen a golden buddha statue, as well as rooms
full of gold bars, in locations controlled by Ferdinand,
including his own office and summer home. Ferdinand's personal
possession of the fruits of the alleged conspiracy to convert
Roxas's property is strong evidence of Ferdinand's involvement.
Moreover, Ferdinand's witnessed possession of large amounts of
gold, combined with the testimony of Curtis, O'Brien, Doel, and
Dacus that at least some of the gold was resmelted and
surreptitiously sold, constitutes sufficient corroboration of the
testimony that Ferdinand was attempting to launder and
fraudulently convey Roxas's gold. Placing the testimony of
percipient witnesses in the context of the many statements of the
alleged conspirators that implicated Ferdinand, the Silverman
anti-bootstrapping rule is satisfied. Imelda also makes arguments with regard to individual
co-conspirators. First, she challenges the sufficiency of the
evidence regarding a conspiracy between Oihara and Ferdinand.
However, Roxas's deposition testimony indicated that Oihara
represented that he was sojourning at Ferdinand's mother's home
and that he had accompanied the raiding party on Roxas's home
when the buddha had been taken. The foregoing, in conjunction
with the evidence that Ferdinand had possession of a similar
buddha at a later time, constituted a sufficient basis for the
circuit court's ruling. Second, Imelda argues that only their own statements
tie Uy, Igna, Clemente, and the persons who arrested Roxas to
Ferdinand. Once again, however, the fact that Ferdinand had
possession of the buddha and gold bullion corroborates the
statements of these individuals that they were attempting to
collect the gold for Ferdinand. Finally, Imelda argues that there was no evidence of
"any meeting, understanding, agreement, or communication between
Judge Pio Marcos and former President Marcos that would support
the existence of an unlawful conspiracy between them." This
argument ignores the testimony of Roxas to the effect that Judge
Marcos told him that he, Judge Marcos, had issued a search
warrant on Ferdinand's order, and that Roxas's life would be in
danger if Roxas pursued his claim for return of the buddha.
Obviously, Ferdinand's order to Judge Marcos was "a
communication," and because the search warrant was not issued in
accordance with Philippine law, the circuit court could
legitimately determine that a conspiracy existed between the two
to perpetrate an illegal confiscation of Roxas's property. Thus,
Imelda's argument must fail. On balance, we hold that the plaintiffs-appellees'
proffer to the circuit court was sufficient to justify its
preliminary determination of the existence of conspiracies, and
this court cannot hold that it was clearly erroneous. G. There Was Sufficient Evidence To Support The Jury's
Special Finding That Ferdinand Converted The Treasure That
Roxas Found. Imelda argues that there was insufficient evidence
to support the jury's special finding that Ferdinand converted
the golden buddha and the rest of the treasure found by Roxas.
She reasons that: (1) there was no evidence to show that the
search warrant displayed by the raiding party was not valid;
and (2) Roxas failed adequately to "occupy" the treasure
remaining in the tunnels after dynamiting the entrance closed
and, therefore, had no further right of possession. 1. There was sufficient evidence that the raid on
Roxas's home was illegal. As noted, Imelda contends that there was no evidence
to support the jury's special finding that Roxas's property
was taken pursuant to an invalid search warrant under
Philippine law. The jury was instructed in accordance with
Imelda's Proposed Instruction No. 29, which stated that, [i]f the golden Buddha and other property was withheld from
Roxas pursuant to a valid search warrant, the Golden Budha
Corporation cannot recover on its conversion claim. A search
warrant is valid if the following requisites exist: (1) It must be issued upon probable cause. (2) The probable cause must be personally determined by the judge. (3) The judge must examine under oath or affirmation the
complainant and the witnesses he may produce. . . . The judge must,
before issuing the warrant, personally examine in the form of
searching questions and answers[ ] in writing and under oath the
complainant and any witnesses he may produce on facts personally
known to them and attach to the record their sworn statements together
with any affidavit submitted. . . . (4) The warrant must describe with particularity the place to be
searched and the person or things to be seized. (5) The warrant must be in connection with one specific
offense. Proposed Instruction No. 29 was based on a summary of the
applicable Philippine law, as set forth in an affidavit of
Renato Dilag, a Philippine lawyer, which Imelda had proffered. Because the search warrant was never produced at
trial, it is difficult to assess whether all of the foregoing
prerequisites were satisfied. However, the jury could
reasonably have inferred that the seizure of the golden buddha
and other items was unlawful based on the following evidence:
(1) Roxas's testimony that Judge Pio Marcos had represented to
him that he, Judge Marcos, had issued the warrant on
Ferdinand's personal order, rather than on his own,
independent analysis of the presence or absence of probable
cause; (2) Roxas's testimony that he had been coerced into
identifying a false buddha that had been placed in the custody
of the clerk of court; and (3) the testimony of Jonsson and
Curtis that they had observed Ferdinand in possession of a
golden buddha. These facts, taken as true, support an
inference that the raid on Roxas's home did not constitute a
legitimate governmental seizure of evidence, but was rather a
wrongful appropriation of Roxas's property orchestrated by
Ferdinand himself. Accordingly, the circuit court did not err
in denying Imelda's motion for a directed verdict, allowing
the question to go to the jury, and denying Imelda's motion
for JNOV or for new trial. 2. There was sufficient evidence to support the
jury's determination that Roxas "found" the treasure pursuant
to Philippine law. Imelda cites a number of federal cases addressing
the maritime laws of finds and salvage to support her
contention that, because Roxas's actions with regard to the
treasure he left in the tunnels failed to alert others of his
claim to possession, he failed to "occupy" it and, therefore,
lost his rights to it. See, e.g., Treasure Salvors, Inc. v.
Unidentified Wrecked and Abandoned Sailing Vessel, 640 F.2d
560 (5th Cir. 1981); Cobb Coin Co., Inc. v. Unidentified
Wrecked and Abandoned Sailing Vessel, 525 F. Supp. 186 (S.D.
Fla. 1981); Moyer v. Wrecked and Abandoned Vessel, Known as
the Andrea Doria, 836 F. Supp. 1099 (D. N.J. 1993); Bemis v.
R.M.S. Lusitania, 884 F. Supp. 1042 (E.D. Va. 1995), aff'd, 99
F.3d 1129 (4th Cir. 1996), cert. denied, 118 S. Ct. 1558
(1998). However, as discussed supra note 16, Philippine law,
not American maritime law, governs this case, and it was the
responsibility of the parties to apprise the court of the
relevant Philippine law. With regard to "possession" under Philippine law,
the circuit court instructed the jury, pursuant to Philippine
Civil Code § 438, as follows: To recover on its claim for conversion, plaintiff must prove that Roger
Roxas had a right under Philippine law to possess whatever treasure he
found. In this regard you are instructed that[,] under Philippine law[,]
hidden treasure belongs to the owner of the land on which it is found.
Nevertheless, when the discovery is made on the land of another, or of
the government, or any of its subdivisions, the finder is entitled to one-half of the treasure so long as the discovery was by chance or by good
luck. You are further instructed that if the finder is a trespasser, he
shall not be entitled to any share of the treasure. The foregoing instruction was a slightly modified version(31) of
Imelda's Proposed Instruction No. 37. Imelda did not propose
any instructions regarding "occupancy" as an element of
possession under Philippine law, nor did she ever suggest to
the circuit court that her instruction failed to completely
define "possession" for purposes of Philippine law. Inasmuch
as Imelda failed to advise the circuit court of any additional
elements of possession pursuant to Philippine law, she cannot
now complain that the circuit court gave and the jury followed
her own proposed instruction.(32) We hold that Roxas's deposition testimony contained
sufficient evidence to support the jury's finding that he
"found" the treasure "by chance or by luck." Accordingly,
there was sufficient evidence to support the jury's verdict
concerning Ferdinand's liability for conversion. H. There Was Sufficient Evidence To Support The Jury's
Special Finding That Ferdinand Caused Roxas To Be Falsely
Imprisoned. Imelda argues that Roxas failed to prove that his
detention and imprisonment were unlawful, inasmuch as he was
tried and convicted by the Baguio City Regional Trial court on
firearms charges. However, Roxas's uncontroverted testimony
was that he was first detained on May 18, 1971 by military
personnel, who interrogated him about the Yamashita treasure
and also subjected him to torture. This detention obviously
had nothing to do with any weapons charge. The jury could
reasonably have based its finding that Ferdinand falsely
imprisoned Roxas based on the foregoing testimony alone.
Accordingly, Imelda's argument is without merit. I. There Was Insufficient Evidence To Support The
Jury's Damage Award Pertaining To The Value Of The Gold Bars
Allegedly Contained In The Unopened Boxes Found Near The
Golden Buddha. Imelda next contends that there was insufficient
evidence to support the jury's award of $22,000,000,000.00,
representing the supposed value of the boxes of gold
purportedly found by Roxas in the Baguio City tunnel. In the
Philippines, [t]he damages recoverable in any case must be susceptible of
ascertainment with a reasonable degree of certainty or, as the rule is
sometimes stated, must be certain both in their nature and in respect to
the cause from which they proceed. Therefore, uncertain, contingent,
or speculative damages cannot be recovered, either in actions ex
contractu, or in actions ex delicto. Choa Tek Hee v. Philippine Publishing Co., 34 Phil. 447, 456
(1916) (citation and internal quotation marks omitted)
(holding that insufficient proof of lost profits had been
introduced to support damages in a libel action). See also
Heredia v. Salinas, 10 Phil. 157, 162-63 (1908) (holding that
alleged losses due to an attorney's flawed representation were
too speculative to support a damage award).(33) Imelda complains that Roxas never observed the
contents of more than one of the boxes he found and that Ocubo
testified that, when he looked inside the boxes during World
War II, they had contained both gold and silver coins.
Moreover, she asserts that there was insufficient evidence to
link the rooms full of gold allegedly observed by Curtis,
Jonsson, Dacus, and O'Brien with Roxas's discovery in the
Baguio City tunnel. In this connection, she notes that Curtis
testified that Ferdinand had represented to him that there
were 172 Yamashita treasure sites from which he had extracted
gold; thus, Imelda asserts that "the gold [that Curtis] and
Jo[nsson] allegedly saw could have come from any of those
sites." However, Doel testified that Clemente had told him
that the tens of thousands of metric tons of gold he had been
asked to sell on Ferdinand's behalf were "war booty . . .
[that] had been buried in tunnels behind the hospital at
Baguio City."(34) It is well established that "[t]he [finder of fact]
may accept or reject any witness' testimony in whole or in
part." State v. Clark, 83 Hawai`i 289, 303-04, 926 P.2d 194,
208-09 (1996) (quoting State v. Eastman, 81 Hawai`i 131, 139,
913 P.2d 57, 65 (1996)) (some brackets in original and some
added). The jury was free to credit Curtis's testimony that
he had personally observed a room full of gold bars, but to
reject his testimony as to its origin. Furthermore, the
Quijons and Roxas testified that men appearing to be
Ferdinand's soldiers had unearthed boxes where Roxas alleged
that he discovered the gold and that at least some of the
boxes were confirmed to have contained gold bars. A
reasonable jury could have inferred from the totality of this
evidence that: (1) the gold to which Clemente referred in his
conversation with Doel was the same gold as that viewed by
Curtis, Jonsson, Dacus, or O'Brien, or by all four of them at
different times and in different locations; and (2) Clemente's
admission signified that all of the gold being laundered had
been found in the tunnels that Roxas had discovered.
Accordingly, regardless of whatever else was contained in the
boxes when Roxas discovered them, there was substantial
circumstantial evidence to support the jury's implicit finding
that the gold in the Marcoses' possession, viewed by one or
all of the foregoing percipient witnesses, had previously been
contained in those same boxes. Imelda makes a more persuasive argument, however,
with regard to the plaintiffs-appellees' evidence concerning
the quantity and value of the gold observed by the percipient
witnesses in the present case. The plaintiffs-appellees
exhorted the jury to derive the value of the converted gold
bullion based solely on the estimates of the ratio of the
weight of gold to its volume, as offered by their expert,
Nelson Colton, who premised his opinions on his reading of the
deposition testimony of Curtis, Jonsson, Dacus, and O'Brien.
The reported observations of these witnesses were extremely
vague. For example, Jonsson testified that the room he had
seen was "[m]aybe 40 feet by 20, something like that"
(emphases added), and that he "believed" that the ceiling was
twelve feet tall, "[m]aybe more. I don't remember."
(Emphasis added.) Later in his testimony, Jonsson opined that
the room was "[m]aybe 42 feet or something. . . . Forty-five
. . . 45 by 25, something like that." (Emphasis added.) He
further testified that there had been a passageway "as wide as
a person's body," which ran the length of the room.
Similarly, Curtis described the room he had observed as
"roughly 40 by 40" with a ceiling that was "at least ten-foot
high." (Emphases added.) There were "at least two, possibly
three aisles," which were "not more than four or five feet"
wide, amidst the piles of gold which were "stacked almost to
the top." (Emphases added.) For his part, O'Brien testified
that he had been taken to a warehouse, in which he had
observed a stack of "three to four hundred" boxes, only one of
which he opened to find "crudely smelted" gold bars, which
were "pitted . . . like an orange peel." Finally, Dacus
testified that he had observed gold stacked in a vault at the
central bank, which he estimated to be "about a hundred cubic
feet." (Emphasis added.) Dacus made a similar estimate,
without explaining his rationale, regarding the "300 to 500
metric tons of gold," which he testified that he had seen in
Ilocas Norte. While we acknowledge that it may be unreasonable to
expect a passing eyewitness to be capable of quantifying the
weight of an entire roomful of gold bars with mathematical
precision, the fact remains that the foregoing witnesses'
estimates afforded the jury no legitimate basis for
determining damages. The range, for example, between
O'Brien's estimate of 300 to 400 boxes of gold yields an
enormous difference in value. Moreover, O'Brien testified
that he actually opened only one box, which was not filled
with gold, but only contained three bars. Similarly,
Jonsson's vacillation among his various estimates of the
dimensions of the room in which he had observed gold generates
a margin of error comprising thousands of tons. More importantly, none of the plaintiffs-appellees'
witnesses could or did testify as to the degree of purity of
the gold they had allegedly observed. As Colton testified,
gold is stored and traded in widely varying degrees of purity
-- a variable that, of course, markedly affects the value of
any particular quantity. Colton could not have known or
reliably estimated the purity of the gold bullion observed by
Curtis, Jonsson, Dacus, and O'Brien, inasmuch as none of these
witnesses provided any reliable guidance on the question.
Accordingly, his estimates of the gold's total value
constituted little more than a guess. Turning to the "handsful" of diamonds that Roxas had
allegedly found secreted in the head of the golden buddha,
counsel for the plaintiffs-appellees candidly admitted to the
jury in his closing argument that he could not point to any
evidence to establish their value: "How many diamonds were
there? I don't know. What carat or weight were these
diamonds? I don't know. How good were these diamonds? Were
they blue whites? Were they the best, the wors[t]? We have
no way of proving that to you." Accordingly, he counseled the
jury to award GBC nothing with respect to these items: "I
can't ask you to guess or speculate. And so [GBC] can't
recover anything for diamonds." Unfortunately for GBC, the
same reasoning and result must also apply to the boxes of gold
bullion. By contrast, Roxas testified that he had estimated
both the weight and size of the golden buddha statue based on
the work of his laborers in removing it from the tunnels. The
plaintiffs-appellees also introduced photographs showing the
size and design of the statue. Furthermore, Roxas testified
as to the results of two chemical analyses performed by
potential purchasers of the statue, both of which determined
the statue to be of a purity over twenty carats, and one of
which allegedly determined that the gold in the statue was
twenty-two carats. Accordingly, there was a reasonable basis
for the jury to make a determination that the statue was
composed of virtually pure gold and, as of the date of
conversion, was worth $1,300,000.00,(35) in accordance with
Colton's testimony. Accordingly, we hold that the circuit court erred in
failing to grant Imelda's motion for a directed verdict with
respect to the damage award for the gold bullion allegedly
contained in the unopened boxes that Roxas discovered. With
respect to the remainder of the damage award, however, see
infra sections III.L and III.M. J. The Circuit Court Rightly Refused To Give Preclusive
Effect To The Baguio City Regional Trial Court's Decision. Borrowing an argument from the plaintiffs-appellees,
Imelda herself invokes the doctrine of collateral estoppel in
relation to her motion for partial summary judgment. She
urges that: (1) Roxas entered an appearance in a Baguio City
court proceeding regarding the golden buddha statue by way of
a letter of his attorney, Daniel Cathcart; and (2) the Baguio
City Regional Trial Court's decision definitively settled the
issue of the buddha's metallurgical composition. The Hawai`i appellate courts have apparently never
addressed the question whether the judgments of foreign
countries will be recognized for purposes of collateral
estoppel.(36) It is unnecessary to answer the question in the
instant case, however, because, assuming the potential for
collateral estoppel, the necessary prerequisites are not met
by the Baguio City Regional Trial Court's order in any event. As noted supra, in section III.A.1, collateral
estoppel bars relitigation of an issue when the following
conditions coalesce: (1) identity of issues; (2) a final
adjudication on the merits; and (3) involvement as a party in
the prior lawsuit of the person, or the person's privies,
against whom it is asserted. SHOPO, 83 Hawai`i at 400, 927
P.2d at 408. First, the issue before the Philippine court, as
that court articulated it, was who had the better claim to the
buddha statue in the court's custody. The court's
pronouncements that the statue was not composed of gold and
that a golden buddha had never existed were not essential to
the resolution of the issue before it. Second, there is no
indication in the record that the document denominated an
"Order," generated by the Baguio City Regional Trial Court,
constituted a final judgment. Finally, and most crucially,
the Roxas Estate was not involved as a party, either directly
or through a proxy, in the Baguio City proceedings. In her
argument to the circuit court, Imelda suggested that, under
Philippine law, Cathcart's letter to the Baguio City Regional
Trial Court constituted an "appearance" in that case.
However, she cited no authority for this dubious proposition.
Cf. Bush, 81 Hawai`i at 480-81, 918 P.2d at 1136-37 (holding
that the filing of an amicus brief in a former proceeding,
which resulted in an adverse decision, was insufficient to
support the application of collateral estoppel because the
amicus had no power to control the course of the former
proceeding). Neither the Roxas Estate nor GBC was listed as a
party to the Baguio City proceeding in any of the associated
documents that Imelda submitted to the circuit court.
Further, the Baguio City Regional Trial Court's order makes no
mention of the plaintiffs-appellees' "involvement" through
Cathcart. Imelda's alternative contention in the circuit court
that Alberto Umali represented the Roxas Estate in the Baguio
City proceeding has no greater support in the record. The
pleadings and documents proffered by Umali to the Baguio City
Regional Trial Court all assert his own interest in the
buddha, based on an alleged contract between Umali and Roxas
in which Roxas agreed to share the proceeds of his discovery.
Umali never claimed to represent the Roxas Estate, either in
documents filed with the court or in the transcripts of the
proceedings that were provided to the circuit court. Moreover, it is clear from his testimony that Jose
Roxas neither represented the plaintiffs-appellees nor their
interests. Jose testified that he wished to immediately burn
the buddha in order to protect the Marcoses and the
Philippines from further "shame" emanating from Roxas's
ongoing claims against the Marcoses. Clearly, Jose Roxas was
not of one mind with Felix Dacanay, the personal
representative of the Roxas Estate and the incorporator of
GBC, who has pursued the instant lawsuit. It is true that two
of Roxas's sons were present at the hearings, providing their
implicit support to Jose's petition. However, Jose himself
testified that Roxas had other children who were not present
or involved, and Roxas's widow was apparently not involved.
Therefore, all potential beneficiaries of the estate were not
represented. Accordingly, we hold that the circuit court did not
err as a matter of law in declining to give preclusive effect,
by way of collateral estoppel, to the "order" of the Baguio
City Regional Trial Court. K. The Circuit Court's Ruling That The Plaintiffs-Appellees' Claims For Constructive Trust And Fraudulent
Conveyance Were Precluded By The Jury's Special Finding That
Imelda Did Not Convert Roxas's Property Was Erroneous With
Respect To The Claim For Constructive Trust But Correct With
Respect To The Claim For Fraudulent Conveyance. In their cross-appeal, the plaintiffs-appellees
contend that the circuit court erred in entering judgment in
favor of Imelda on GBC's claims for constructive trust and
fraudulent conveyance against Imelda in her individual
capacity. They argue that the circuit court erred in ruling,
as a matter of law, that these claims were precluded by the
jury's special finding that Imelda did not convert Roxas's
property. 1. Philippine law does not interpose conversion as
a precondition to the creation of a constructive trust. As noted supra at note 16, Philippine law governs
the plaintiffs-appellees' substantive claims for relief in
this case. The plaintiffs-appellees cite to a decision of the
Philippines Supreme Court, Sumaoang v. Honorable Judge,
Regional Trial Court, Branch XXXI, Guimba, Nueva Ecija, 215
SCRA 136 (Phil. 1992), in support of their argument that
conversion is not a condition precedent to the creation of a
constructive trust. In that case, an attorney who had
successfully litigated a land title dispute sued his former
clients when they failed to pay him for his services. Id. at
138-41. Although the trial court expressly ruled that the
attorney was entitled to one-half of the value of the land, in
accordance with the terms of the contingent fee agreement
signed by the parties, it nevertheless (and apparently
inadvertently) awarded the attorney a sum equivalent to the
value of the entire plot of land. Id. at 141. The attorney
filed a writ of execution on his judgment and was subsequently
able to purchase the entire plot of land at a public auction.
Id. at 142. The Philippines Supreme Court held that the trial
court's order was erroneous and that the attorney was deemed
to have title to one-half of the plot of land in constructive
trust for the benefit of his former clients. Id. at 145-46.
The Sumaoang court explained that, in the Philippines, "[i]f
property is acquired through mistake or fraud, the person
obtaining it is, by force of law, considered a trustee of an
implied trust for the benefit of the person from whom the
property comes." Id. at 145-46 (quoting Phil. Civ. Code §
1456). The Court clarified, however, that it was not
necessary that the constructive trustee personally be found
liable for fraud or mistake. Rather, "[t]he 'mistake' or
'fraud' that results in an implied trust being impressed upon
the property involved[] may be the mistake or fraud of a third
person, and need not be a mistake or fraud committed directly
by the trustee himself under the implied trust." Id.
(emphasis in original) (footnote omitted). Accordingly, the
Sumaoang court ruled that "an implied trust was established
upon the land acquired by [the attorney] even though the
operative mistake was a mistake of respondent trial judge."
Id. In response, Imelda quotes from an annotation of
Philippine trust law, which states that, "if a person obtains
legal title to property by fraud or concealment, courts of
equity will impress upon the title a so-called constructive
trust in favor of the defrauded party." Pompeyo Rodolfo J.
Cabrillas, Annotation, Trust and Trust Relations, 61 SCRA 309
(1974). Imelda also notes, as have the plaintiffs-appellees,
that Philippine Civil Code § 1456 links "mistake or fraud"
with the establishment of a constructive trust. Neither of
the foregoing authorities, however, stands for the proposition
that only the individual personally responsible for the
mistake or fraud may be subject to the imposition of a
constructive trust. In any case, the clear holding of
Sumaoang as described above, undermines any such argument.
Likewise, Imelda's citation to various American authorities on
constructive trust is immaterial, inasmuch as the Philippines
Supreme Court possesses the ultimate authority to determine
Philippine law. See In re Shoop, 41 SCRA 213, 254-58 (Phil.
1920) (noting that the Philippines has a mixed common
law/civil law system and that the supreme court's opinions
represent controlling precedent). Alternatively, Imelda argues that GBC's claim of
constructive trust against her necessarily failed by virtue of
the jury's implicit finding that she had never had possession
or dominion over any of Roxas's property when it expressly
found that she had not converted it. In this connection, we
note that the jury was instructed regarding the issue of
conversion pursuant to the provisions of Philippine Revised
Penal Code Article 315 (Article 315), which pertains to the
crime of "estafa" or "swindling."(37) At trial, Imelda proffered
the affidavit of a Filipino attorney, Renato Dilag, which
averred that a private civil action for conversion in the
Philippines is based on Article 315.(38) Pursuant to Dilag's
affidavit and Imelda's proposed instruction, the jury was
instructed that the essential elements of the Philippine tort
of conversion are that: "(a) [t]he accused defrauded another
by means of deceit[] and (b) [d]amage or prejudice capable of
pecuniary estimation was caused to the offended party." Thus,
it was on the strength of the foregoing instruction that the
jury found that Imelda had not engaged in conversion. This
can only mean that the jury was unable to (1) find that Imelda
personally (a) defrauded Roxas (i.e., exercised unauthorized
control over Roxas's property) (b) by means of deceit, (2)
determine the value of the property over which Imelda had
control, or (3) both. We may not and do not infer, as Imelda
would have us, that the jury necessarily found that Imelda
exerted no dominion or control over Roxas's property. On the
contrary, the jury might simply have found that any deceit
involved was perpetrated by Ferdinand. As Imelda points out, note 1 to Article 315 provides
in relevant part that "[f]raud as used in the Code should be
taken in the broad sense and includes any act by means of
which an undue gain is obtained. To defraud is to deprive a
person of what rightfully belongs to him." While the
Philippine definition of fraud may be "broad," it nevertheless
does not include the additional element of "deceit," which is
apparently necessary to rise to the level of the criminal
offense of "swindling" or "estafa." Note 47 to Article 315 defines "conversion" as an unauthorized assumption and exercise of the right of ownership
over goods or personal chattels belonging to another, to the alteration
of their condition or the exclusion of the owner's rights. It takes place
when a person actually appropriates the property of another to his own
beneficial use and enjoyment or to that of a third person. (Footnote omitted.) The foregoing definition of "conversion"
lends credence to Imelda's argument that conversion is
coextensive with the exercise of any unlawful dominion over
another's property under Philippine law and, therefore, that
the jury's finding exonerating Imelda of conversion
necessarily precluded the imposition of a constructive trust.
However, the jury was not instructed in accordance with note
47. On the contrary, Imelda's own proposed instruction, the
substance of which the circuit court incorporated into that
given the jury, mandated that the jury must find deceit -- not
merely unauthorized dominion -- in order to establish
conversion under Philippine law. "As a rule, we presume that
the jury followed the circuit court's instructions." Kawamata
Farms, 86 Hawai`i at 247, 948 P.2d at 1088 (citations
omitted). Given the heightened responsibility of the parties
to apprise the trial court of governing foreign law, Imelda
cannot now complain that her own instructions misstated the
law to her detriment. See supra notes 16 and 32. Thus, the
jury's special verdict with respect to conversion could not
definitively foreclose the imposition upon Imelda of the
status of a constructive trustee. In other words, by
following the circuit court's instruction, the jury could have
found that Imelda had not converted Roxas's property because
of the lack of any affirmative showing of "deceit" on her
part. Finally, Imelda argues that insufficient evidence
was adduced at trial to support a finding that she had
exercised dominion or control over Roxas's property. However,
although it is not entirely clear, the record on appeal
appears to reflect that the circuit court ruled that it would
undertake its own fact-finding regarding the plaintiffs-appellees' equitable claims against the Marcoses after the
jury's verdict.(39) There was, therefore, no need for the
plaintiffs-appellees to adduce evidence regarding Imelda's
control or dominion over Roxas's property during the phase of
the proceeding that was tried to the jury. Accordingly, we hold that the circuit court erred in
ruling as a matter of law that the plaintiffs-appellees'
constructive trust claim was foreclosed by the jury's verdict.
We therefore vacate the circuit court's judgment in favor of
Imelda in her individual capacity and against the plaintiffs-appellees with regard to their constructive trust claim and
remand for further proceedings before the circuit court
sitting in equity. 2. The jury's special finding that Imelda did not
convert Roxas's property precluded GBC from prevailing on its
claim of fraudulent conveyance. The plaintiffs-appellees also contend that the
circuit court erred in ruling that the jury's special verdict
as to Imelda with regard to conversion foreclosed the
possibility that Imelda could be liable for fraudulent
conveyance. The parties failed at trial to provide the
circuit court with any clear expression of Philippine law
pertaining to the claim of "fraudulent conveyance."
Accordingly, this court will apply Hawai`i law. See supra
note 16. HRS § 651C-4 (1993), a provision of Hawaii's version
of the Uniform Fraudulent Transfer Act, provides in relevant
part that [a] transfer made or obligation incurred by a debtor is fraudulent as to
a creditor whether the creditor's claim arose before or after the transfer
was made or the obligation incurred, if the debtor made the transfer or
incurred the obligation: (1) With actual intent to hinder, delay, or defraud any creditor of the
debtor; or (2) Without receiving a reasonably equivalent value in exchange for
the transfer or obligation, and the debtor: (A) Was engaged or was about to engage in a business or a
transaction for which the remaining assets of the debtor were
unreasonably small in relation to the business or transaction; or (B) Intended to incur, or believed or reasonably should have
believed that the debtor would incur, debts beyond the debtor's
ability to pay as they became due. In the plaintiffs-appellees' complaint, GBC alleged,
inter alia, that in April of 1971 and on repeated occasions thereafter up to the present
time the Defendants, and each of them, in an effort to hide the
Yamashita Treasure from the Plaintiff and others, conveyed,
hypothecated and otherwise disposed of portions of the Yamashita
Treasure to third parties including relatives, friends, and corporations
owned and or controlled by the Defendants, all for inadequate
consideration and all for the purpose of permanently depriving the
owner of the Yamashita Treasure of his property. (Emphasis added.) As the highlighted language in the
complaint emphasizes, GBC was alleging that Imelda transferred
Roxas's property for inadequate consideration with the intent
to "permantly depriv[e]" Roxas and his assigns of the
property. The issue, then, is whether this alleged conduct
was subsumed within the jury instruction pertaining to
conversion. See supra section III.K.1. The instructions, as they were actually given to the
jury, did not include the legal definitions of "defraud" or
"deceit." Accordingly, we presume that the jury applied the
commonly understood meaning of those terms. Cf. HRS § 1-14
(1993) ("The words of a law are generally to be understood in
their most known and usual signification[.]"). Webster's New
World Dictionary (3d college ed. 1988) defines "deceit," inter
alia, as "a dishonest action or trick." Id. at 357. The same
dictionary defines "defraud" as "to take away or hold back
property, rights, etc. from by fraud; cheat." Id. at 362.
Clearly, GBC's allegation that Imelda attempted to conceal the
Yamashita treasure through surreptitious transfers entailed a
"dishonest action or trick" designed to "cheat" her creditors.
Accordingly, the circuit court was correct in ruling that
the jury's special verdict with regard to conversion,
premised, as it was, on an instruction that erroneously
required the jury to determine whether Imelda had engaged in
"deceit," and therefore entailing an implicit finding that
Imelda had not engaged in such conduct, precluded GBC from
prevailing on its claim of fraudulent conveyance against
Imelda in her individual capacity. L. The Proper Measure Of Damages In Connection With
GBC's Conversion Claim Was The Value Of The Golden Buddha And
The Seventeen Gold Bars Within A Reasonable Time After Roxas
Learned Of The Conversion. The plaintiffs-appellees argue that the circuit
court erred in instructing the jury that the correct measure
of damages in connection with GBC's claim for relief arising
out of the conversion of Roxas's gold was the value of the
gold on the date of conversion. They assert, instead, that
the proper measure should have been the highest value of the
gold between the time of its taking and the entry of the
circuit court's amended judgment. Like most of the issues on appeal in this matter, it
would be appropriate to apply Philippine law to the measure of
damages. Unfortunately, once again, none of the parties have
cited any Philippine authority. Accordingly, this court will
apply Hawai`i law. See supra note 16. Imelda cites to this court's opinion in Tsuru v.
Bayer, 25 Haw. 693, 699-700 (1920), for the proposition that
the measure of damages for conversion is "the fair reasonable
value of the property at the time of the conversion."
However, in that case, the conversion at issue was of the
personal effects of the lessee of a building, which were taken
and sold by the building's owner. Id. at 694. Accordingly,
the Tsuru court was not concerned with the valuation of a
commodity of fluctuating value, such as the gold involved in
the instant case. Indeed, it appears that the issue has never
been directly addressed by the Hawai`i appellate courts. In Brougham v. Swarva, 661 P.2d 138, 143-44 (Wash.
Ct. App. 1983), a case involving the conversion of silver
coins, the Washington Court of Appeals summarized the
approaches adopted by the various jurisdictions toward the
valuation of fluctuating commodities as follows: Prior [Washington state] cases have applied the standard measure of
damages for conversion of stock, i.e., the fair market value at the date
of conversion, Rogich v. Dressel, 45 Wash.2d 829, 278 P.2d 367
(1954)[;] Elliott v. Seattle Co., 178 Wash. 94, 34 P.2d 442 (1934)[;]
Hetrick v. Smith, 67 Wash. 664, 122 P. 363 (1912) [(40)], but recent
decisions in other jurisdictions have held otherwise. Some decisions have awarded damages based on the highest
value reached by the stock or personal property between the time of
conversion and trial. Ott v. Fox, 362 So. 2d 836 (Ala. 1978);
Chattanooga Discount Corp. v. West, 219 F. Supp. 140, 146 (N.D.
Ala. 1963) (security conversion); Royal-Liverpool Ins. Group v.
McCarthy, 229 S.C. 72, 91 S.E.2d 881 (1956) (automobile
conversion).[(41)] Other jurisdictions have awarded the highest price
between the date of conversion and a reasonable time after learning
thereof. Fletch v. Cobuzzi, 510 F. Supp. 263 (W.D. Pa. 1981) (stock
conversion); Reed v. White, Weld & Co., 571 S.W.2d 395 (Tex. Civ.
App. 1978) (conversion of securities).[(42)] Still other courts have
applied the "New York rule[,]" which awards the highest price within
a reasonable time after learning of the conversion[,] disregarding the
period between conversion and learning thereof. Klein v. Newburger
Loeb & Co., 151 So. 2d 879 (Fla. App. 1963) (stock conversion);[(43)]
Schug v. Michael, 310 Minn. 22, 245 N.W.2d 587 (1976) (stock
conversion); Hoffman v. Dorner, 86 A.D.2d 651, 447 N.Y.S.2d 20
(1982) (conversion of gold and silver coins).[(44)] Finally, some courts
have awarded damages based on their highest value between the time
of conversion and judgment. Kaplan v. Cavicchia, 107 N.J.Super. 201,
257 A.2d 739 (1969) (conversion of securities); U.S. Cities Corp. v.
Sautbine, 126 Okl. 172, 259 P. 253 (1927) (stock conversion).[(45)] (Emphasis added.) In line with the first approach described by the
Brougham court, Imelda cites Charles Selon & Assocs, Inc. v.
Aisenberg, 431 N.E.2d 1214 (Ill. Ct. App. 1981). In
Aisenberg, the Illinois Court of Appeals declined to adopt an
exception to the general rule that "damages are set at the
date of conversion" for converted gold. The Aisenberg court
noted that the Illinois Supreme Court had similarly declined
to make an exception for converted stock, arguing that such an
exception "was based on the premises that the plaintiff
originally obtained the stock for a permanent investment and
would have kept it until the time of trial" and that such
premises were "arbitrary and speculative." Id. at 1217
(citing Sturges v. Keith, 57 Ill. 451 (1870)). See also
Gerstle v. Gamble-Skogmo, Inc., 478 F.2d 1281, 1305 (2d Cir.
1973) (holding that the assumption that the plaintiffs would
have sold stocks at their highest value was "too untenable and
speculative to support an award of damages" (citation and
internal quotation marks omitted)). We agree that some subjectivity inheres in any
measure of damages that assumes that the victim of a
conversion would have sold the commodity at the highest price
during a particular period of time. However, [t]he hallmark of conversion cases is the interference with the
plaintiff's ability to transfer [commodities] he owns or to which
he is entitled. The injury that the plaintiff suffers is the
deprivation of his range of elective action, and by applying the
conversion measure of damages a court endeavors to restore
that range of elective action. To require the plaintiff to show
that he would have sold his securities, had he been able, is to
require him to prove that he would have taken the very steps
that defendant's wrongful act . . . precluded him from taking. . .
. The defendant's acts prevent a court from determining
with any degree of certainty what the plaintiff would have done
with his [commodities] had they been freely alienable.
Because it is the defendant who creates this uncertainty,
fundamental justice requires that, as between [the plaintiff] and
[the defendant], the perils of such uncertainty should be laid at
defendant's door. American Gen. Corp. v. Continental Airlines Corp., 622 A.2d 1,
10 (Del. Ch.), aff'd, 620 A.2d 856 (Del. 1992) (citations and
internal quotation signals omitted) (some brackets added and
some in original). On the other hand, we believe that the approach
advocated by GBC and adopted in some jurisdictions -- i.e.,
that the measure of damages must be the highest value of the
converted property between the time of the conversion and the
time of judgment or the filing of the complaint -- tips the
balance too far to the other side. There is no persuasive
punitive or compensatory rationale for penalizing the
defendant (absent bad faith delay) or rewarding the plaintiff
for the time required for the plaintiff to file a complaint or
obtain a judgment. "[T]o adopt the highest value between the
time of actual conversion and the trial would be to encourage
the owner to delay and speculate upon the chances of higher
markets, without assuming the chances of lower markets."
Newburger Cotton Co. v. Stevens, 267 S.W. 777, 778 (Ark.
1925). However readily ascertainable the relevant time period
might be pursuant to this rule, we deem the rule's unfairness
to outweigh its predictability. On balance, we agree with the resolution at which
the Brougham court arrived. After considering the options
available to it, the Brougham court adopted the "New York
rule," holding that "the measure of damages is the highest
value of the property wrongfully and knowingly converted
between the time of conversion and a reasonable time after the
person learns of such conversion." Id. at 144. "Such a
rule," declared the Brougham court, protects the victim who has invested in property for speculative
purposes when the market either rises or falls subsequent to the
conversion. The innocent victim should not suffer a loss because of a
wrongful taking and withholding of his property. Neither should he be
granted the windfall of complete umbrella protection by being awarded
the highest possible valuation of the property from the time of its
taking to the entry of judgment or its return. Id. at 144 (citation omitted).(46) The "New York rule" errs on the side of granting the
unforeseen benefit of a fluctuating commodity's increase in
value to the innocent victim of conversion rather than to the
converter, but it does not do so to the extent of conferring
an unreasonable windfall. It also avoids the foreseeable
possibility that, because of a sudden and infelicitous dip in
the market for a particular commodity on the date of
conversion, the victim of conversion would be inadequately
compensated for his or her loss by operation of the general
rule. Moreover, the New York rule tempers the speculative
nature of such a measurement of damages by disregarding the
market prices of the converted commodity between the time of
conversion and the time the plaintiff discovers the
conversion. We can be relatively certain that the plaintiff
would not have sold the commodity during that time period
absent the defendant's wrongdoing because "'if he had desired
to dispose of [his property] in that interval, he would have
learned of the conversion.'" Schultz v. Commodity Futures
Trading Comm'n, 716 F.2d 136, 141 (2d Cir. 1983) (quoting In
re Salmon Weed & Co., 53 F.2d 335, 341 (2d Cir. 1931))
(brackets in original). We therefore expressly adopt the New
York rule with respect to the valuation of fluctuating
commodities. With regard to how the trier of fact is to arrive at
its determination of a "reasonable time," the courts applying
the "New York rule" have described the object of that inquiry
as the time necessary to replace the converted commodity. See
Schultz, 716 F.2d at 140 ("The 'true and just measure of
damages in these cases' is 'the highest intermediate value of
the [commodity] between the time of its conversion and a
reasonable time after the owner has received notice of it to
enable him to replace the [commodity].'" (Quoting Galigher v.
Jones, 129 U.S. 193, 201 (1889).); Mayer v. Monzo, 117 N.E.
948, 950 (N.Y. 1917) (the value of the converted commodity is
the highest value within "a reasonable time after notice of
the conversion within which to determine whether he will
purchase other [commodities] in the place thereof"); Gelb v.
Zimet Brothers, Inc., 228 N.Y.S.2d 111, 113 (N.Y. Sup. Ct.
1962), aff'd, 237 N.Y.S.2d 989 (N.Y. 1963) (following Mayer);
American General Corp., 622 A.2d at 13 ("[T]he date should be
established by resort to a 'constructive replacement' purchase
by the plaintiff, i.e., how long it would have taken the
plaintiff to replace the [commodity] on the open market.");
Hornblower & Weeks-Hemphill Noyes v. Lazere, 222 N.W.2d 799,
807 (Minn. 1974) (following Gelb). In other words, the rule
sets as an outside boundary for the determination of the value
of the converted commodity the latest date upon which a
"reasonable investor" with adequate funds would have reentered
the market by purchasing a replacement for his or her
converted commodity to "cover" the damages from the
conversion. See Mitchell v. Texas Guld Sulphur Co., 446 F.2d
90, 105 (10th Cir. 1971), cert denied, 404 U.S. 1004 (1972).
The rule's underlying premise is that any increase in value of
the commodity after that cut-off date would have been enjoyed
by the reasonable investor and should therefore not be awarded
to the plaintiff who (presumably) missed his or her chance to
be exposed to the market. Thus, applying the New York rule to
the present case, the date of close of the evidence at trial
would , as a matter of law, be the absolute end-point beyond
which the "reasonable time" cannot extend, inasmuch as the
market values of the converted Buddha statue and gold bars
beyond that date would be unknowable to the trier of fact. Accordingly, the circuit court's jury instruction
regarding the valuation of the converted gold was erroneous.
Likewise, the special verdict form erroneously required the
jury to value the gold as of the date of conversion. Because
we have already held that there was insufficient evidence to
support an award of damages for such gold bullion as may have
been contained in the unopened boxes allegedly found by Roxas,
inasmuch as the record was speculative regarding the gold's
quantity and purity, see supra section III.I, there is no need
to remand for a recalculation of the value of that gold.
However, with respect to the golden buddha statue and the
seventeen gold bars taken from Roxas's home, a new trial on
the issue of value is necessary, and we therefore vacate that
portion of the circuit court's judgment regarding the damages
attributable to the golden buddha statue and the seventeen
golden bars and remand for further proceedings. On retrial,
the circuit court should instruct the jury that the measure of
damages for the conversion of the golden buddha and the
seventeen gold bars is the highest value of the gold between -- and including -- the date of conversion and a reasonable
time thereafter.(47) The reasonable time is bounded by the
latest date on which a reasonable investor with adequate funds
would have replaced the converted gold. The reasonable time
cannot extend beyond the date of the close of evidence at
trial. Moreover, the circuit court should require the jury to
make special finding of the date corresponding to the highest
value of the gold within the reasonable time for purposes of
calculating an award of prejudgment interest. See infra
section III.M.2. M. The Circuit Court Did Not Abuse Its Discretion In
Failing To Award Prejudgment Interest With Regard To The Roxas
Estate's Claims Of Battery And False Imprisonment; It Did,
However, Commit An Abuse Of Discretion By Awarding Prejudgment
Interest Regarding GBC's Claim Of Conversion Merely From The
Commencement Of The Lawsuit. As a final matter, the plaintiffs-appellees contend
that the circuit court committed abuses of discretion in
ruling on their motion for prejudgment interest. They urge
that the Roxas Estate should have been awarded prejudgment
interest from April 5, 1971, the date of Roxas's first
detention and torture, with respect to its claims of battery
and false imprisonment, whereas the circuit court granted none
at all. They also argue that GBC should have been awarded
prejudgment interest from January 1, 1975, rather than from
the date of the filing of the complaint. 1. In connection with Roxas's battery and false
imprisonment claims, the circuit court acted within the scope
of its discretion in denying prejudgment interest from the
date of Roxas's first arrest, inasmuch as the jury may have
tailored its award to account for the passage of time. Prejudgment interest is awardable at the discretion
of the court pursuant to HRS § 636-16 (1993). Eastman, 86
Hawai`i at 26-27, 946 P.2d at 1222-23. HRS § 636-16 provides
that, [i]n awarding interest in civil cases, the judge is authorized to
designate the commencement date to conform with the circumstances
of each case, provided that the earliest commencement date in cases
arising in tort, may be the date when the injury first occurred and in
cases arising by breach of contract, it may be the date when the breach
first occurred. Prejudgment interest is "essentially compensatory in
nature" and is "given on money demands as damages for delay in
payment, being just compensation to the plaintiff for a
default on the part of his debtor." Sussel v. Civil Serv.
Comm'n, 74 Haw. 599, 618-19, 851 P.2d 311, 321,
reconsideration denied, 74 Haw. 650, 857 P.2d 600 (1993)
(quoting Lucas v. Liggett & Myers Tobacco Co., 51 Haw. 346,
349, 461 P.2d 140, 143 (1969)). See also Amfac, Inc., 74 Haw.
at 137, 839 P.2d at 36 ("The purpose of [HRS § 636-16 is] to
allow the court to designate the commencement date of interest
in order to correct the injustice when a judgment is delayed
for a long period of time for any reason, including litigation
delays." (Citations and internal quotation marks omitted.)). The plaintiffs-appellees maintain, somewhat
hyperbolically, that prejudgment interest is "virtually
mandatory" and is a "right" recognized at common law. More
moderately, the plaintiffs-appellees acknowledge that this
court has stated that "prejudgment interest is to be allowed
wherever it is properly proved." Sussell, 74 Haw. at 618, 851
P.2d at 313 (citing City and County of Honolulu v. Caetano, 30
Haw. 1 (1927)). However, it is clearly within the discretion
of the circuit court to deny prejudgment interest where
appropriate, for example, where: (1) the defendant's conduct
did not cause any delay in the proceedings, see Amfac, Inc.,
74 Haw. at 137, 839 P.2d at 36; (2) the plaintiff himself has
caused or contributed to the delay in bringing the action to
trial, see Schmidt v. Board of Directors of the Association of
Apartment Owners of the Marco Polo Apartments, 73 Haw. 526,
534-35, 836 P.2d 479, 484 (1992); or (3) an extraordinary
damage award has already adequately compensated the plaintiff,
see Leibert v. Finance Factors, Ltd., 71 Haw. 285, 293, 788
P.2d 833, 838 (holding that it was an abuse of discretion for
the circuit court to award prejudgment interest to a treble
damages award), reconsideration denied, 71 Haw. 664, 833 P.2d
899 (1990). In this case, the circuit court declined to grant
prejudgment interest to the Roxas Estate because (1) the jury
might have incorporated the value of Roxas's general damages
from the date of his initial arrest and torture to the date of
his death in its damage award in connection with the battery
and false imprisonment claims and (2) the jury's damage award
was sufficient to compensate the estate for any loss of
interest. The plaintiffs-appellees are correct that it was
Marcos's own actions in engineering a new constitutional
provision, which conferred immunity from suit on himself, that
caused the protracted delay in commencing the present action.
Imelda, however, counters that the plaintiffs-appellees
contributed to the delay as well -- reiterating her arguments
that Roxas was under no duress and could freely have sued in
the Philippines. As discussed supra, section III.B, Imelda's
arguments are without merit. The "delay" factor, therefore,
militates in the plaintiffs-appellees' favor. As noted above, however, in Amfac, Inc., this court
reiterated that there may be reasons separate and apart from
whether the defendant was responsible for delay that may enter
into the calculus relating to the allowance of prejudgment
interest. In the present case, the circuit court premised its
ruling on its determination that the jury may already have
compensated the Roxas Estate for litigation delay. The
plaintiffs-appellees argue that the circuit court's basis
constituted improper speculation into the jury's intentions.
The jurors were not instructed to factor interest into their
damage award, the plaintiffs-appellees note, and, therefore,
it would be improper to impute an unknown intention to them.
As Imelda observes, however, the plaintiffs-appellees
themselves implicitly invited the jury to tailor its damages
award to include any delay in compensation. In his closing
argument, Cathcart urged that: the issue is what is reasonable compensation for the pain, the suffering
and the anxiety and the fears which [Roxas] endured from January
25th, 1971, a period of time when, as Felix Dacanay described it, he
was hunted like an animal. Where his life with his family was
interrupted. Where he feared for his family's life and where ultimately
he went down to Viscayan to get away from the possible danger and
all that for a period January 25, 1971 until he died on May 24th, 1993.
That's 22 years, if my math is correct. Obviously the pain, the suffering and the anxiety was more
intense while he was being threatened and tortured. When General
Ver came up to him and said: Roger, don't make any trouble. The
threat's clear. When he lived in fear for the rest of his life and had to
hide much of his life or go to remote or distant places much of his life.
What's it worth? It's worth what you say it's worth. Imelda further notes that the special verdict form directed
the jury to "state the amount of actual damages, if any, to be
awarded to the plaintiff Estate of Roger Roxas to compensate
it for any injuries or damages suffered during his lifetime as
a result of his false imprisonment and/or battery." (Emphasis
added.) In light of the foregoing, it was not unreasonable
for the circuit court to infer that the jury actually
compensated Roxas for his post-imprisonment suffering. Thus,
although Ferdinand was clearly responsible for causing the
delay in the adjudication of the plaintiffs-appellees' claims,
given the wording of the special verdict form, Cathcart's
legitimate exhortation of the jury to factor Roxas's post-imprisonment years of suffering into its damage award, and the
magnitude of the sum -- $6,000,000.00 -- actually awarded to
the Roxas Estate in damages, we cannot say that the circuit
court "exceeded the bounds of reason" in declining to award
prejudgment interest to the Roxas Estate. Accordingly, we
hold that the circuit court did not abuse its discretion by
denying the plaintiffs-appellees' motion for prejudgment
interest with respect to the Roxas Estate. That portion of
the circuit court's October 18, 1996 order is affirmed. 2. The circuit court committed an abuse of
discretion by failing to award GBC prejudgment interest from
the date of the conversion. Without articulating any reasons for doing so, the
circuit court allowed GBC prejudgment interest commencing from
the date the plaintiffs-appellees' lawsuit was filed, rather
than from January 1, 1975 (the approximate date on which
Ferdinand allegedly began converting most of the treasure from
the tunnels at Baguio City, see supra section I.B.7), as
requested. The plaintiffs-appellees argue that this unfairly
accorded the Marcoses the opportunity to realize the
investment profit from Roxas's gold during the period of its
conversion and continuing to the date of the complaint. Because the special verdict form specifically
limited the jury's award to the value of the gold actually
converted, it cannot be said that the plaintiffs-appellees'
damages were of such an extraordinary nature as to fall within
the Liebert exception. See supra section III.M.1. Moreover,
the rationale underlying the awarding of prejudgment interest
in conversion actions is clear and intuitive: We begin with the proposition that interest is compensatory in nature,
not punitive, and it is for this reason that interest is properly given to a
plaintiff from the date of conversion of his property by a defendant
until the date judgment is satisfied. There is no sound reason why a
plaintiff should not be able to recover a loss in earnings of an asset
which defendant converted. Lucas, 51 Haw. at 348, 461 P.2d at 142 (citations omitted).
Finally, as noted above, the responsibility for the delay in
commencing the present action lies overwhelmingly with
Ferdinand. Therefore, it would appear that there is little
justification for the circuit court's ruling. Imelda argues that (1) the purpose of prejudgment
interest is not to force the defendant to disgorge profit,
but, rather, to discourage delay in adjudication, and (2)
pursuant to McKeague v. Talbert, 3 Haw. App. 646, 658 P.2d 898
(1983), the circuit court lacked the discretion, in any case,
to award prejudgment interest for any period prior to May 8,
1979, the effective date of HRS § 636-16. Imelda's first argument amounts to little more than
a semantic dispute with the plaintiffs-appellees. Clearly,
the implication in this court's oft-repeated characterization
of prejudgment interest as "compensatory" is that the award is
meant to make the plaintiff whole with respect to delay in
receiving damages to which he or she is entitled. The
foregoing proposition is the functional equivalent of the
notion that prejudgment interest is designed to afford the
plaintiff the approximate investment value of the damage
award, which the law presumes the defendant has acquired as a
windfall. Imelda's second argument is more substantial than
her first, but, in the end, also fails. In McKeague, supra,
the ICA construed HRS § 636-16, noting that, prior to the
enactment of that statute, this court had expressly approved
of the award of prejudgment interest, where properly proved,
in City and County of Honolulu v. Caetano, 30 Haw. 1 (1927),
and Lucas, supra. McKeague, 3 Haw. App. at 660-61, 658 P.2d
at 909. The ICA also quoted from the language of the
conference committee report on 1979 Haw. Sess. L. Act 78,
which promulgated HRS § 636-16, as follows: The purpose of this bill is to more clearly define the trial
judge's descretion [sic] in awarding interest in civil cases. Your Committee understands that at the present time interest is
generally awarded commencing on the day the judgment is rendered.
Where the issuance of a judgment is greatly delayed for any reason,
such fixed commencement date can result in substantial injustice.
Allowing the trial judge to designate the commencement date will
permit more equitable results. Also, it is expected that party litigants
will give serious regard to this discretion on the part of the trial judge
so that those who may have had an unfair leverage by the arbitrariness
of the prior rule will arrive at the realization that recalcitrance or
unwarranted delays in cases which should be more speedily resolved
will not enhance their position or assure them of a favorable award. Id. at 662, 658 P.2d at 909 (quoting Conf. Comm. Rep. No. 67,
in 1979 Senate Journal, at 984) (brackets in original)
(footnote omitted). The ICA surmised that the situation that gave rise to the statute was that, notwithstanding
Caetano and Lucas, plaintiffs in this jurisdiction have not pleaded and
proved interest as an element of damages except in contract actions or
actions for liquidated damages. Also, notwithstanding that in Lucas
the court said § 478-2 does not preclude prejudgment interest, the
courts in this jurisdiction have not been asked to award it. Id. at 662, 658 P.2d at 910 (footnote omitted). The McKeague
court then held: (1) that HRS § 636-16 had "replaced" the
Lucas rule; (2) that the legislature had expressed no intent
that HRS § 636-16 should have retroactive effect; and,
therefore, (3) that, by dint of the new statute, circuit
courts had no discretion to award prejudgment interest for any
period prior to its enactment on May 18, 1979. Id. at 663,
658 P.2d at 910. Notwithstanding the McKeague court's analysis, the
history underlying HRS § 636-16 establishes that the
legislature intended retroactive effect to be given to the
statute's provisions. See HRS § 1-3 (1993) (providing that
"[n]o law has any retrospective operation unless otherwise
expressed or obviously intended"). The clear spirit of HRS §
636-16, as unambiguously expressed in the conference committee
report quoted by the McKeague court itself was to codify the
courts' preexisting discretion to award prejudgment interest.
The ICA thus misapprehended the spirit underlying HRS § 636-16
by construing the statute to restrain the courts from awarding
prejudgment interest for periods prior to its enactment -- in
effect, according the courts less discretion on the issue than
before. The unfairness thus engendered is especially
apparent in cases like the one at bar, in which the
plaintiffs-appellees expressly prayed for prejudgment interest
in their complaint and actually adduced the requisite proof at
trial; yet because the ICA held that HRS § 636-16 replaced the
common law rule on prejudgment interest, they ostensibly do
not enjoy the same access to prejudgment interest as
plaintiffs whose judgments were entered before 1979.
Moreover, the ICA's interpretation in McKeague effectively
delayed the implementation of the new statute (itself designed
to end delays) by years, inasmuch as the statute could not
affect any action involving a compensable injury occurring
before May 18, 1979. Finally, the McKeague interpretation
allowed tortfeasors to benefit from the investment potential
of damage awards that, but for the tortfeasors' own attempts
to delay judgment, would have been in the possession of
plaintiffs. Cf. Hawaiian Beaches, Inc. v. Kondo, 52 Haw. 279,
281, 474 P.2d 538, 540 (1970) (holding that the "ordinary
meaning" of the term "interest" is "payment made for the
privilege of using another's money" (citations omitted)). Contrary to the ICA's analysis in McKeague, we
believe that HRS § 636-16 should be afforded retroactive
effect because it is a remedial statute designed to clarify
and encourage the exercise of judicial discretion in the award
of prejudgment interest. Cf. State v. Von Geldern, 64 Haw.
210, 638 P.2d 319 (1981) (holding that the legislative history
of the penal code evinced a desire by the legislature to
provide flexibility in sentencing and that sentencing
provisions could therefore be applied retroactively); Palea v.
Rice, 34 Haw. 150, 158 (1937) ("[W]here a remedial statute is
clearly intended to cure a defect in an earlier statute so as
to make it operative in the bestowal of accruing benefits to
persons from the date of the earlier statute, and is without
ambiguity in meaning and intent in that respect, the
legislative intent as to retroaction must be given effect, for
the spirit or reason of the law is the life of the law."). We
therefore overrule McKeague insofar as it holds that HRS §
636-16 restricts the circuit court's discretion in awarding
prejudgment interest to periods subsequent to may 18, 1979. We have already held that the issue of damages must
be remanded to the circuit court in order to afford the jury
the opportunity to determine the highest value of the golden
buddha statue and the seventeen gold bars converted from Roxas
between the date of conversion and a reasonable time after
Roxas had notice of the conversion, excluding any time between
the conversion and Roxas's discovery of it. See supra section
III.L. Pursuant to the New York rule, the jury, on remand,
might find that the value of the gold corresponds to its
market value on a date subsequent to the date of conversion.
In such an event, the jury will already have compensated GBC
for Roxas's loss of market appreciation between the date of
conversion and the date of the value chosen. Just as it would
be unfair to compensate the Roxas Estate doubly for the "time
value" of the damages arising out of its claims of battery and
false imprisonment damages by awarding prejudgment interest
when the jury has already factored the passage of time into
its award, see supra section III.M.1, it would be unfair to
award GBH prejudgment interest for the period between the date
of conversion and the date corresponding to the value of the
gold chosen by the jury. Cf. American General Corp., 622 A.2d
at 13-14 (holding, in a breach of contract case, that
prejudgment interest started to accrue from the date the
plaintiff's damages actually began to accrue rather than from
the date of the breach). Accordingly, we hold that, upon
retrial of the issue, the circuit court should award
prejudgment interest on the damages arising out of the
conversion of the golden buddha and the seventeen gold bars
from the date corresponding to the value of the gold chosen by
the jury.
Based on the foregoing analysis, we (1) reverse that portion of the circuit court's amended judgment awarding GBC $22,000,000,000.00 for "one storage area" of gold bullion, (2) vacate those portions of the amended judgment (a) entering judgment in favor of the plaintiffs-appellees and against Imelda, in her capacity as personal representative of the Marcos Estate, (b) awarding GBC $1,400,000.00 in damages for conversion of the golden buddha statue and the seventeen gold bars, and (c) entering judgment in favor of Imelda and against the plaintiffs-appellees on GBC's claim for constructive trust, and (3) remand the matter to the circuit court for (a) the entry of judgment against Imelda in her personal capacity, to the extent of her interest in the Marcos Estate, on the Roxas Estate's claims of battery and false imprisonment, and GBC's claim of conversion against Ferdinand, (b) a new trial on the value of the converted golden buddha statue and seventeen gold bars, (c) an award of prejudgment interest on the damages awarded as a consequence of the conversion of the golden buddha and seventeen gold bars, commencing from the date corresponding to the value of the gold assigned by the jury, and (d) further proceedings, to the extent necessary, on GBC's equitable claim against Imelda,
in her personal capacity, for constructive trust. In all other respects, the circuit court's amended judgment is affirmed.
On the briefs:
Lex Smith, Bert T. Kobayashi,
Jr. (of Kobayashi, Sugita &
Goda) for defendant-appellant/
cross-appellee Imelda Marcos,
and Stephen R. Johnson (Law
Office of Linn & Neville of
Oklahoma City, OK), appearing
Pro Hac Vice
Ward D. Jones and Alexander T.
MacLaren (of Chuck Jones and
MacLaren) for plaintiffs-
appellees/cross-appellants
The Estate of Roger Roxas and
The Golden Budha Corporation,
and Daniel C. Cathcart (Law
Office of Magana, Cathcart &
McCarthy of Los Angeles, CA),
appearing Pro Hac Vice
1. HRE Rule 803 provides in relevant part that "[t]he following [is] not excluded by the hearsay rule, even though the declarant is available as a witness: . . . A statement that was offered against a party and was uttered by . . . a co-conspirator of the party during the course and in furtherance of the conspiracy."
2. Most of the trial testimony relevant to this appeal and cross-appeal was introduced by way of the depositions of various witnesses (including, most crucially, Rogelio Roxas), which were read to the jury. Much of the remaining trial testimony consisted of edited videotapes of the depositions of other witnesses.
Over the course of several weeks of pretrial motions and conferences, the parties litigated which portions of the foregoing depositions would be admissible, and the circuit court rendered oral rulings from time to time. Apparently, the parties agreed that the court reporter would not transcribe the redacted trial deposition testimony as it was read into the record. Neither party appears to have marked the redacted versions of the deposition transcripts as trial exhibits for identification. Instead, the unredacted versions of the transcripts (both those read to the jury and those prepared in conjunction with the videotapes) were designated as part of the record on appeal, along with over one dozen videocassettes. In their briefs, all parties cite without explanation to the deposition transcripts, which, as noted, are not technically part of the trial record. Neither side indicates where, if anywhere, the record contains a centralized listing of the admitted portions of the deposition testimony.
Accordingly, this court has been left to piece together crucial portions of the trial record through a maze of designations, counterdesignations, objections, and rulings spread in no particular order throughout thousands of pages of transcripts and more than twelve hours of videotaped testimony. This is not an appropriate means of preparing a record for review on appeal. For the purposes of any further proceedings in the present case on remand, see infra, and in future cases in general, the circuit courts should require that any deposition testimony read into evidence or displayed by means of videocassette recordings be transcribed by the court reporter as if it were live testimony.
For present purposes, we deem the parties, in effect, to
have stipulated portions of the deposition transcripts as the
trial record in their briefs. Furthermore, we note, subject to a
few exceptions that are not material to our analysis, that the
parties do not dispute the facts as adduced at trial.
Accordingly, we have made reference to the deposition transcripts
in the construction of the following statement of the facts, at
the risk of reciting some facts that may not be in evidence, with
the understanding that our statement of the factual background
essentially mirrors the facts as adopted by the parties in their
appellate briefs.
3. Cheatham testified at trial. Although he acknowledged going
to Roxas's house to see the buddha, he denied performing the
assay, reporting instead that he "saw where someone had taken a -- probably a primitive drill bit or a -- a wooden drill and
drilled a one-inch hole in the bottom of the Buddha to obtain a
sample for analysis."
4. The Malacanang Palace is the Philippine equivalent of the
United States' "White House."
5. An excerpt of the official transcript of the June 30, 1971
hearing, which was read by the defense to the jurors, indicated
that Roxas answered questions about his actions during the period
of his alleged abduction, but did not mention being kidnaped or
tortured. However, it appears that the entire transcript of the
hearing was not introduced into evidence. Therefore, it is
unclear whether the excerpted portion contained the entirety of
Roxas's testimony on that occasion.
6. Neither letter was produced at trial.
7. The "hallmark" of a gold bar is a stamp with a serial number,
which indicates its registration in a particular country.
8. HRCP Rule 25 (1996) provides in relevant part: Substitution of Parties. (a) Death. (1) If a party dies and the claim is not thereby
extinguished, the court may order substitution of the proper
parties. The motion for substitution may be made by any
party or by the successors or representatives of the
deceased party and, together with the notice of hearing,
shall be served on the parties as provided in Rule 5 and
upon persons not parties in the manner provided in Rule 4
for the service of summons, and may be served in any
judicial district. Unless the motion for substitution is
made not later than 120 days after the death is suggested
upon the record by service of a statement of the fact of the
death as provided herein for the service of the motion, the
action shall be dismissed as to the deceased party.
9. This evidence was included in the record on appeal to this
court from the first circuit court's orders declining to open
probate proceedings and appoint a personal representative for the
Marcos Estate in Hawai`i. This court's disposition of that
appeal was filed on September 16, 1998. See In re Estate of
Marcos, 88 Hawai`i 148, 963 P.2d 1124 (1998). Both Imelda and
GBC were parties to that action. In addition, Irene Silverman (a
California attorney temporarily named special administrator of
Marcos's California assets, see infra) and Commissioner Vinzons-Chato were active parties. The Pasig City trial court's January 11, 1996 order was not
made a part of the record on appeal in the instant case. "While
matters not properly presented to the trial court may not
ordinarily be considered by the appellate court on appeal, an
appellate court may[,] in its discretion, take judicial notice of
files or records of a case on appeal." State v. Schmidt, 70 Haw.
443, 446, 774 P.2d 242, 244 (1989) (citing Eli v. State, 63 Haw.
474, 478, 630 P.2d 113, 116 (1981) and Hawai`i Rules of Evidence
(HRE) Rule 201). Moreover, "[c]ourts have generally recognized
that they may, in appropriate circumstances, take notice of
proceedings in other courts, both within and without their
judicial system[,] if those proceedings have a direct relation to
the matter at issue." Sapp v. Wong, 3 Haw. App. 509, 512 n.3,
654 P.2d 883, 885-86 n.3 (1982) (citations omitted). See also
Turner v. State, 79 Hawai`i 118, 120, 899 P.2d 401, 403 (App.),
cert. denied, 79 Hawai`i 341, 902 P.2d 976 (1995); Waimea Falls
Park, Inc. v. Brown, 6 Haw. App. 83, 87-88, 712 P.2d 1136, 1140
(1985); State v. Durry, 4 Haw. App. 222, 224-25, 665 P.2d 165,
169 (1983), overruled on other grounds by State v. Jackson, 81
Hawai`i 39, 912 P.2d 71 (1996). The resolution of Imelda's actual status as a court-appointed executor of Ferdinand Marcos's estate directly affects
the propriety of her substitution as a party on behalf of the
estate of Ferdinand Marcos in the present lawsuit. Thus, the
Pasig City court's order is highly pertinent. Furthermore, given
that (1) all parties in the present appeal were active
participants in the probate action in Supreme Court No. 20885 and
(2) those proceedings were clearly ancillary to the instant
lawsuit (because they were initiated by GBC in order to assure
satisfaction of its anticipated judgment in this case), it is
equitable to notice the record in those proceedings. 10. The plaintiffs-appellees adduced no evidence on this issue.
Moreover, the Philippine Regional Trial Court's order regarding
the Marcos Estate, introduced into the record in the Hawai`i
probate proceedings, states that, "[u]pon filing of a bond in the
amount of $50,000.00, let letters testamentary be issued in
solidum to Imelda Trinidad Romualdez-Marcos AND Ferdinand
Romualdez Marcos II, named executors therein." The order also
clarified that, "[p]ending the filing of said bond and their
oath, Commissioner Liwayway Vinzons-Chato of the Bureau of
Internal Review is hereby authorized to continue her functions as
Special Administrator of the Estate of Ferdinand Edralin Marcos."
The probate record is silent as to whether Imelda ever took the
oath or filed the bond. Accordingly, the present record is
devoid of any indication that Imelda has ever been judicially
recognized as executrix or administrator of the Marcos Estate.
11. GBC first sought to institute probate proceedings for the
Marcos Estate in 1990, but its petition was denied by the first
circuit court. See In re Estate of Marcos, 88 Hawai`i at 151,
963 P.2d at 1127. Its motion for reconsideration was also
denied. See id. at 5. A 1995 pleading "again attempted to open
a probate proceeding in Hawai`i" and requested that Silverman be
appointed personal representative of the estate. See id. at 8-9.
Finally, in 1996, Silverman petitioned the probate court for
appointment as special administrator of the Marcos Estate. That
petition was also denied. See id. at 9-10. On appeal, this
court affirmed the probate court's orders. Id. at 22.
12. No transcripts were included in the record on appeal in In re
Estate of Marcos, No. 20885.
13. This appears to be an alternate spelling for "Joe Oihara."
14. HRCP Rule 59 provides in relevant part that "[a] motion to
alter or amend the judgment shall be served not later than 10
days after entry of judgment."
15. HRS § 636-16 provides: Awarding interest. In awarding interest in civil
cases, the judge is authorized to designate the commencement
date to conform with the circumstances of each case,
provided that the earliest commencement date in cases
arising in tort, may be the date when the injury first
occurred and in cases arising by breach of contract, it may
be the date when the breach first occurred.
16. None of the parties address the issue of choice of law in
their briefs. In a ruling that has apparently not been made part
of the record, the circuit court decided to apply Philippine law
to a number of the issues raised by this case, including the
parameters of the plaintiffs-appellees' claims for relief for
battery, false imprisonment, and conversion. In determining what
law governs when multiple jurisdictions are implicated in an
action, [w]e have moved away from the traditional and rigid
conflict-of-laws rules in favor of the modern trend towards
a more flexible approach looking to the state with the most
significant relationship to the parties and subject matter.
See Peters v. Peters, 63 Haw. 653, 634 P.2d 586 (1981).
Primary emphasis is placed on deciding which state would
have the strongest interest in seeing its laws applied to
the particular case. Cf. id. Lewis v. Lewis, 69 Haw. 497, 499, 748 P.2d 1362, 1365 (1988). In this case, all the relevant events occurred in the
Philippines, and, at the time, all parties were residents of the
Philippines. Neither of the plaintiffs -- Felix Dacanay, as
personal representative of the Roxas Estate, or GBC -- has any
particular ties to this jurisdiction. Hawai`i is no more than
the forum of the present dispute. Accordingly, the Philippines
have the greater interest in its outcome, and it was appropriate
for the circuit court to apply Philippine law, as it did, see
infra, to the plaintiffs-appellees' claims for relief. In light of the foregoing, it would have made sense for the
circuit court to have applied Philippine law as to the survival
or abatement of those claims for relief. See Restatement
(Second) of Conflict of Laws § 167 (1971). However, as far as we
can discern, the parties never addressed Philippine law, if there
is any, on the question at trial, and their appellate briefs are
silent on the issue. This court may take judicial notice of the
law of foreign countries. See Hawai`i Rules of Evidence (HRE)
Rule 202(c)(5) (1993). "The court, in determining foreign law,
may consider any relevant material or source, including
testimony, whether or not submitted by a party or admissible
under the Hawai`i Rules of Evidence. The court's determination
shall be treated as a ruling on a question of law." HRCP Rule
44.1 (1996) (emphasis added). Nevertheless, a number of cases in
this and other jurisdictions have held that where the parties
have failed to supply or address applicable foreign law, local
law will be applied. See Touche Ross Ltd. v. Filipek, 7 Haw.
App. 473, 479, 778 P.2d 721, 726 (1989); Block v. Lea, 5 Haw.
App. 266, 268 n.4, 688 P.2d 724, 727-28 n.4, cert. denied, 67
Haw. 685, 744 P.2d 781 (1984); Hall v. American Airlines, Inc., 1
Haw. App. 258, 617 P.2d 1230 (1980); see also Carey v. Bahama
Cruise Lines, 864 F.2d 201, 205-06 (1st Cir. 1988); Nikimiha Sec.
Ltd, v. Trend Group, Ltd, 646 F. Supp. 1211, 1227 (E.D. Pa.
1986); Miller v. A.N. Webber, Inc., 484 N.W.2d 420, 422 (Minn.
Ct. App. 1992); Restatement (Second) of Conflict of Laws § 136
comment (h); Eugene F. Scoles & Peter Hay, Conflict of Laws §§
12.18-12.19 (1992) (collecting cases); contra, Walton v. Arabian
Am. Oil Co., 233 F.2d 541 (2d Cir.), cert. denied, 352 U.S. 872
(1956) (dismissing the case where foreign law was not proved).
In the present matter, we need not directly address whether it is
generally appropriate for courts in this jurisdiction to
ascertain foreign law ex officio because reliable sources of
Philippine law are not available. Under such conditions, it is
eminently sensible to cast the burden of apprising the court
regarding foreign law on the parties, and, where they fail to
meet their burden, to assume acquiescence in the application of
local law. Accordingly, we apply HRS § 634-61 to our analysis.
17. The Bagalay court also noted that "[t]he will of appellant
clearly stated that [his guardian] was to be the executrix of the
estate, and as such, she would have been the proper party to be
substituted for the appellant." Bagalay, 60 Haw. at 136, 588
P.2d at 423-24. This sentence might be interpreted to mean that
a person may be substituted for a deceased party so long as she
is named as executrix in the decedent's will. However, in an
earlier part of the opinion, the Bagalay court clarified that it
meant that the executrix in a probated will was the proper party:
"For the purposes of pursuing the present case, we can see no
reason why counsel . . . did not promptly apply for a probate of
the will and have [the appellant's guardian] designated as
executrix and legal representative of appellant." Id. at 134-35,
588 P.2d at 423 (emphases added).
18. As she acknowledged at trial, and as the record in the
Hawai`i probate case indicates, Imelda was actively engaged in
litigating the issue of her appointment as representative of the
Marcos Estate in the Philippines. If, in fact, she had been
named executrix and personal administrator prior to the present
appeal (and even subsequent to the circuit court's ruling), this
court would not disturb her substitution pursuant to HRCP Rule
25(a)(1) or her designation as the personal representative of the
Marcos Estate. "[A]s long as the 'proper party' actually defends
the suit, such defense can cause a waiver of the right to formal
substitution." Mathews v. Mathews, 599 So. 2d 1218, 1221 (Ala.
Ct. App. 1992) (internal quotation marks and citation omitted).
However, on the record before us, the plaintiffs-appellees have
failed to establish that Imelda has been so appointed.
19. We note that Imelda is not alone in adopting a different
stance on appeal. In support of their motions to substitute
Silverman, the plaintiffs-appellees argued that the stipulation
might not be sufficient to guard the judgment against collateral
attack without a judicially appointed representative of the
Marcos Estate. On appeal, they argue that the stipulated
substitution of Imelda is sufficient to support the judgment.
However, the doctrine of judicial estoppel does not apply unless
the changed argument prejudices the opposing party. Rosa, 4 Haw.
App. at 218, 664 P.2d at 751. "To constitute this sort of
estoppel[,] the act of the party against whom the estoppel is
sought must have gained some advantage for himself or produced
some disadvantage to another; or the person invoking the estoppel
must have been induced to change his position or by reason
thereof the rights of other parties must have intervened." Yuen,
40 Haw. at 230 (citation and internal quotation signals omitted).
In other words, a party is free to "plead[] inconsistent claims
or defenses within a single action," but "[a] party is precluded
from subsequently repudiating a theory of action [that has been]
accepted and acted upon by the court" or that has otherwise
detrimentally affected the opposing party. Rosa, 4 Haw. App. at
220, 664 P.2d at 752 (emphasis added). Here, the plaintiffs-appellees' arguments regarding the sufficiency of the stipulation
were rejected by the circuit court and did not otherwise appear
to affect Imelda's defense. Accordingly, the plaintiffs-appellees' change of heart on appeal does not prejudice Imelda,
whereas Imelda's insistence below that the stipulation was
sufficient to protect the interests of the plaintiffs-appellees
was adopted by the circuit court to the plaintiffs-appellees'
detriment. Moreover, we note that the fact that the plaintiffs-appellees may also have been aware that Imelda had not been
judicially appointed as personal representative of the Marcos
Estate at the time they entered into the stipulation does not
defeat the application of judicial estoppel to Imelda in this
case. Judicial estoppel is a subset of the doctrine of "quasi-estoppel," which "has its basis in election, waiver,
acquiescence, or an acceptance of benefits. A party is precluded
from asserting[,] to another's disadvantage, a right inconsistent
with a position previously taken by him. No misrepresentation or
concealment of facts by one and ignorance of the other are
necessary." Id. at 219 n.12, 664 P.2d at 751 n.12 (citing Godoy,
Yuen, and Hartman v. Bertelmann, 39 Haw. 619 (1952)) (emphasis
added).
20. Rule 9(a) Rules of Civil Procedure, Section 21-413,
A.C.A.1939, provides that if a party litigant desires to raise
the issue of the authority of one to be sued in a representative
capacity it must be done by specific negative averment. Rule
12(d) Rules of Civil Procedure, Section 21-436, A.C.A.1952,
provides in effect that any objection to such authority is waived
unless presented before trial. Jasper, 264 P.2d at 412. Accord HRCP Rule 9(a) (1996) ("When a
party desires to raise an issue as to . . . the authority of a
party to sue or be sued in a representative capacity, he shall do
so by specific negative averment, which shall include such
supporting particulars as are peculiarly within the pleader's
knowledge."); HRCP Rule 12(h)(1) (1996) ("A defense of lack of
jurisdiction over the person . . . is waived . . . if it is
neither made by motion under this rule nor included in a
responsive pleading or an amendment thereof permitted by Rule
15(a) to be made as a matter of course.").
21. The Jasper court also approvingly cited to the common law
doctrine of "executor[ship] de son tort" as "another sound reason
for sustaining the judgment." 264 P.2d at 412. [A]ny intermeddling with the estate of a decedent under a
claim of authority, or any act characteristic of the office
of a rightful executor or which evinces legal control, makes
the person doing such act an executor de son tort.
Probably, the most common form of intermeddling is taking
possession of the assets without administration and
controlling the property as if the taker were the legal
representative. In re Estate of Johnson, 705 So. 2d 819, 822 (Miss. 1996)
(citation omitted). See also In re Estate of Retzel, 586 So. 2d
1247, 1252 (Fla. Ct. App. 1991), review denied by CSX Transp.
Inc. v. Estate of Retzel, 593 So. 2d 1051 (Fla. 1992); Palmisano
v. Connell, 534 N.E.2d 1243, 1249 (Ill. Ct. App.), appeal denied,
545 N.E.2d 115 (Ill. 1989). An executor de son tort may also
bind the estate if (1) he or she is later appointed executor, (2)
he or she undertakes an action on behalf of the estate in good
faith that the lawfully-appointed administrator failed to
attempt, despite a duty to do so, or (3) the lawfully appointed
executor or administrator ratifies his or her actions. Jasper,
264 P.2d at 413. This court long ago rejected the doctrine of executorship de
son tort, reasoning that our probate statutes "allow a creditor
of a deceased person to apply for administration" of an estate,
and, therefore, that "[t]he creditor has it always in his power,
by this method, to protect himself, and to obtain possession of
the assets and to prevent any improper meddling with or wasting
of the estate[.]" Frag v. Adams, 5 Haw. 664, 666 (1886). But
see supra note 18, regarding the application of the harmless
error doctrine to the situation in which a substituted party is
subsequently named executor.
22. We express no view as to the potential res judicata or
collateral estoppel effect of this opinion, or as to the
application of any relevant statute of limitations, on any future
lawsuit prosecuted against the Marcos Estate by the plaintiffs-appellees and based upon the claims for relief asserted in the
present case.
23. The plaintiffs-appellees advance the additional argument that
Imelda is collaterally estopped from raising the statute of
limitations issue by Hilao v. Marcos, 103 F.3d 767 (9th Cir.
1996) (Hilao II). In Hilao II, the United States Court of
Appeals for the Ninth Circuit considered the appeal of the final
judgment entered in the same lawsuit giving rise to Hilao I,
discussed supra in section III.A.1. Among the issues raised by
the Marcos Estate in Hilao II was the effect of the statute of
limitations on the plaintiffs' claims. The parties disputed
whether the applicable statute of limitations should be derived
from the Philippine Civil Code, the federal Torture Victim
Protection Act (TVPA), or 42 U.S.C. § 1983. Id. at 773. The Hilao II court responded that "[w]e need not decide
which statute of limitations applies because Hilao's suit was
timely under any of the proposed statutes when equitable tolling
principles are applied." Id. The court cited authority for the
proposition that both the TVPA and Hawai`i law (implicated
because section 1983 suits incorporate state statutes of
limitations) allow for equitable tolling. Id. at 773. However,
the Hilao II court failed to note or discuss any applicable
Philippine authority. The court then determined that any of the
statutes would have been tolled during the Marcos presidency
because (1) Ferdinand "engineered the passage of a constitutional
amendment granting him, and others acting at his direction,
immunity from suit during his tenure in office" and (2) the
plaintiffs were justifiably afraid of retribution. Id.
Accordingly, the Hilao II court concluded that "the filing of
this action was timely under any of the asserted statutes of
limitations." Id. (emphasis added). It would, therefore appear that, technically, the
plaintiffs-appellees have established the elements of collateral
estoppel in the present case, inasmuch as: (1) the issue decided in the prior suit [i.e.,
whether equitable tolling applies] is identical to
the issue presented in the action in question; (2)
there was a final judgment on the merits in the
prior suit; and (3) the party against whom
collateral estoppel is asserted [-- Imelda Marcos,
in her alleged capacity as personal representative
of the Marcos Estate --] was a party or in privity
with a party to the prior suit. SHOPO, 83 Hawai`i at 400, 927 P.2d at 408 (citing Bush, 81
Hawai`i at 480, 918 P.2d at 1136). On the other hand, the Hilao
II court failed to (1) cite any Philippine authority indicating
that Philippine law allows for equitable tolling or (2) otherwise
justify its conclusion. The Hilao II court's ipse dixit answer
to the question of equitable tolling is thus unsatisfying. As
discussed infra, the plaintiffs-appellees should prevail via
application of Philippine law in any case. Accordingly, we need
not rely on the doctrine of collateral estoppel to dispose of the
equitable tolling issue.
24. Imelda claims that all of the language of article VII,
section 7 quoted above was added to the Philippines Constitution
by the 1981 amendment. Our research indicated to the contrary.
See, e.g., Jose N. Nolledo, The New Constitution of the
Philippines Annotated 193 (1975) ("Section 7 of Article VII
provides that the President during his tenure is immune from
suits . . . ."). Compare also Primo L. Tongko, Philippine Government
Under the New Constitution 380 (1975) (reproducing the language
of article VII § 7 as quoted above) with Primo L. Tongko, The
Philippine Government Under the Fourth Republic 371 (1981)
(reproducing the language of article VII § 15 of the amended
constitution as quoted above).
25. The plaintiffs-appellees once again argue that the issue is
precluded by collateral estoppel, this time arising from two
unpublished opinions of the United States Court of Appeals for
the Ninth Circuit. In In Re Estate of Ferdinand Marcos Human
Rights Litigation, 94 F.3d 539, 542 & n.1 (9th Cir. 1996), the
Ninth Circuit noted that it had previously reversed the dismissal
-- on "act of state" grounds -- of five human rights lawsuits
against the Marcoses in two unpublished opinions reported in the
federal reporter's table of decisions as Hilao v. Marcos, 878
F.2d 1438 (9th Cir. 1989) (Hilao III), and Trajano v. Marcos, 878
F.2d 1439 (9th Cir. 1989). The plaintiffs-appellees maintain
that this precedent precluded Imelda from raising the act of
state doctrine as a defense in the instant case. We disagree. We note at the outset that the Ninth Circuit also rejected
the Marcoses' assertion of the act of state defense in an action
brought by the Republic of the Philippines, which asserted RICO
claims against the Marcoses. See Republic of the Philippines v.
Marcos, 862 F.2d 1355, 1360-61 (9th Cir. 1988) (en banc), cert.
denied, 490 U.S. 1035 (1989) (Republic II). We also note that,
although Hilao III, Trajano, and Republic II all involved many of
the same parties, they were nevertheless substantively distinct
lawsuits and related to each other only in subject matter. As discussed above, a precondition to collateral
estoppel is identity of issues. SHOPO, 83 Hawai`i at 400, 927
P.2d at 408. By its very nature, see infra, the act of state
doctrine is concerned with the particular circumstances of the
individual "acts" in question. Neither the alleged conversion of
the gold claimed by Roxas, his detention, nor his torture were at
issue in any of the federal lawsuits cited. Furthermore, the
plaintiffs-appellees have alleged in the present matter that
Ferdinand's conduct vis-a-vis Roxas arose out of the former's
personal desire to acquire the latter's wealth, rather than out
of a generally oppressive political regime. Thus, inasmuch as
the foregoing federal human rights cases did not address issues
identical to those raised in the instant matter, their holdings
may not collaterally estop the assertion of the act of state
doctrine as a defense here.
26. For ease of reference, we have labeled this decision Republic
II, see supra note 25, and we will designate Republic of the
Philippines v. Marcos, 806 F.2d 344 (2d Cir. 1986), cert. denied
sub nom New York Land Co. v. Republic of the Philippines, 481
U.S. 1048 (1987), as Republic I, see infra.
27. See supra note 28.
28. 22 U.S.C. § 2370(e)(2) provides: Notwithstanding any other provision of law, no court in
the United States shall decline on the ground of the federal
act of state doctrine to make a determination on the merits
giving effect to the principles of international law in a
case in which a claim of title or other right to property is
asserted by any party including a foreign state (or a party
claiming through such a state) based upon (or traced
through) a confiscation or other taking after January 1,
1959, by an act of that state in violation of the principles
of international law, including the principles of
compensation and the other standards set out in this
subsection: Provided, That this subparagraph shall not be
applicable (1) in any case in which an act of a foreign
state is not contrary to international law or with respect
to a claim of title or other right to property acquired
pursuant to an irrevocable letter of credit of not more than
180 days duration issued in good faith prior to the time of
confiscation or other taking, or (2) in any case with
respect to which the President determines that application
of the act of state doctrine is required in that particular
case by the foreign policy interests of the United States
and a suggestion to this effect is filed on his behalf in
that case with the court. (Emphasis in original.)
29. We have denominated this case as Domingo I because it appears
to be both related, and chronologically antecedent, to the
opinion of the United States District Court for the Western
District of Washington in Estate of Domingo v. Republic of the
Philippines, 694 F. Supp. 782, 786 (W.D. Wash. 1988), appeal
dismissed, 895 F.2d 1416 (9th Cir. 1990), see infra.
30. FRE Rule 801(d)(2)(E) provides in pertinent part that "[a]
statement is not hearsay if . . . [t]he statement is offered
against a party and is . . . a statement by a co-conspirator of a
party during the course and in furtherance of the conspiracy."
31. The circuit court removed a sentence originally included in
the proposed instruction, which stated: "'By chance' means that
there must be no purpose or intent to look for the treasure."
The circuit court also added the phrase "or by luck" to the end
of the third sentence of the instruction. While these
modifications were significant, they had nothing to do with the
constructs of "occupancy" or constructive "possession." Imelda
has not raised the circuit court's modification of her proposed
instruction as a point of error on appeal.
32. With respect to a plainly erroneous jury instruction given in
a criminal case, we are aware that it is of no consequence that the trial court gave the . . .
instruction at [the defendant's] request. This is because the trial court is the sole source of all definitions
and statements of law applicable to an issue to be
resolved by the jury. Moreover, it is the duty of the
circuit court to see to it that the case goes to the
[jurors] in a clear and intelligent manner, so that
they may have a clear and correct understanding of what
it is that they are to decide, and [the trial court]
shall state to them fully the law applicable to the
facts. And faced with inaccurate or incomplete
instructions, the trial court has a duty to, with the
aid of counsel, either correct the defective
instructions or to otherwise incorporate it into its
own instructions. In other words, the ultimate
responsibility properly to instruct the jury lies with
the circuit court and not with trial counsel. State v. Kupau, 76 Hawai`i 387, 394-95, 879 P.2d 492, 499-500 (1994) (citations, footnotes, internal quotation marks,
brackets, and emphasis omitted). State v. Loa, 83 Hawai`i 335, 358, 926 P.2d 1258, 1281 (1996). Civil cases, on the other hand, are governed by the HRCP.
HRCP Rule 51(e) (1996) provides in relevant part that "[n]o party
may assign as error the giving or the refusal to give, or the
modification of, an instruction . . . unless he objects thereto before the jury retires to
consider its verdict, stating distinctly the matter to which he
objects and the grounds of his objection." Nevertheless, "even
the complete failure to object to a jury instruction does not
prevent an appellate court from taking cognizance of the trial
court's error if the error is plain and may result in a
miscarriage of justice." Montalvo v. Lapez, 77 Hawai`i 282, 288,
884 P.2d 345, 351, reconsideration denied, 77 Hawai`i 489, 889
P.2d 66 (1994) (citations and internal quotation marks omitted).
This too is because, "[o]nce all the evidence has been presented,
it becomes the court's fundamental duty to properly instruct the
jury on the law on the precise issues of fact it is to decide."
Id. at 291, 884 P.2d at 354 (footnote omitted). In the present case, Imelda has made no showing that her
Proposed Instruction No. 37 was plainly erroneous, and we have no
reason to believe that it was. In any event, where the law of a
foreign nation, which is not readily ascertainable by and
accessible to the trial court, is outcome-dispositive of an issue
central to a civil proceeding conducted in the circuit courts of
this jurisdiction, the responsibility of the parties to assist
the court in ferreting out the correct governing legal principles
is particularly heightened. See supra note 16.
33. As it happens, Hawai`i law is in accord. See, e.g.,
Tabieros, 85 Hawai`i at 391, 944 P.2d at 1334 ("[A]ssumptions
[relating to damages and] based on mere speculation that are
foundational to an expert's opinion testimony render the latter
inadmissible as untrustworthy, i.e., as unreliable." (Citation
and internal quotation marks omitted.); Weinberg v. Mauch, 78
Hawai`i 40, 50, 890 P.2d 277, 287 ("[I]t is of the essence in an
action . . . that the plaintiff suffer damages as a consequence
of the defendant's conduct, and these damages cannot be
speculative or conjectural losses." (Citation and internal
quotation marks omitted.)), reconsideration denied, 78 Hawai`i
421, 895 P.2d 172 (1995); Chung v. Kaonohi Center Co., 62 Haw.
594, 612, 618 P.2d 283, 294-95 (1980) (approving an instruction
that advised the jury that it was "not permitted to award a party
speculative damages, which means compensation for loss or harm,
which, although possible, is conjectural or not reasonably
certain"); McLellan v. Atchison Ins. Agency, Inc., 81 Hawai`i 62,
66, 912 P.2d 559, 663 (1996) ("Actual [losses or] damages are
those that are real and substantial as opposed to speculative."
(Citations and internal quotation marks omitted.) (Brackets in
original.)).
34. Imelda's objection to the use of this testimony as hearsay is
addressed supra in section III.F.
35. We note that Imelda does not appear to have directly
challenged the statue's value in her appellate briefing.
36. In 1996, the Hawai`i legislature passed the Uniform Foreign
Money-Judgments Recognition Act, HRS ch. 658C. 1996 Haw. Sess.
L. Act 49, § 1-3 at 69-71. This legislation mandates the
recognition of foreign judgments under certain conditions. It is
not directly applicable in the present case, however, because, by
its own terms, Act 49 relates only to "judgment[s] of a foreign
state granting or denying recovery of a sum of money[.]" HRS §
658C-2 (Supp. 1997). The Act does not preclude recognition of
other types of judgments through the doctrine of comity. See HRS
§ 658C-8 (Supp. 1997) ("This chapter shall not prevent the
recognition of a foreign judgment in situations not covered by
this chapter.")
37. Article 315 provides in relevant part: Swindling (estafa).-- Any person who shall defraud another
by any of the means mentioned hereinbelow shall be punished
. . . provided that . . . the fraud be committed by any of
the following means: 1. With unfaithfulness or abuse of confidence, namely: (a) By altering the substance, quantity, or quality of
anything of value which the offender shall deliver by virtue
of an obligation to do so, even though such obligation be
based on an immoral or illegal consideration. (b) By misappropriating or converting, to the prejudice
of another, money, goods, or any other personal property
received by the offender in trust or on commission, or for
administration, or under any other obligation involving the
duty to make the delivery of or to return the same, even
though such obligation be totally or partially guaranteed by
a bond; or by denying having received such money, goods, or
other property. (c) By taking undue advantage of the signature of the
offended party in blank, and by writing any document above
such signature in blank, to the prejudice of the offended
party or any third person. 2. By means of any of the following false pretenses or
fraudulent acts executed prior to or simultaneously with the
commission of the fraud: (a) By using [a] fictitious name, or falsely pretending
to possess power, influence, qualifications, property,
credit, agency, business or imaginary transactions, or by
means of other similar deceits. (b) By altering the quality, fineness or weight of
anything pertaining to his art or business. (c) By pretending to have bribed any Government
employee, without prejudice to the action for calumny which
the offended party may deem proper to bring against the
offender. In this case, the offender shall be punished by
the maximum period of the penalty. (d) By postdating a check, or issuing such check in
payment of an obligation, the offender knowing that at the
time he had no funds in the bank, or the funds deposited by
him in the bank were not sufficient to cover the amount of
the check, and without informing the payee of such
circumstances. (e) By obtaining any food, refreshment, or
accommodation at a hotel, inn, restaurant, boarding house,
lodging house, or apartment house and the like without
paying therefor, with intent to defraud the proprietor or
manager thereof, or by obtaining credit in a hotel, inn,
restaurant, boarding house, lodging house, or apartment
house by the use of any false pretense, or by abandoning or
surreptitiously removing any part of his baggage from a
hotel, inn, restaurant, boarding house, lodging house, or
apartment house after obtaining credit, food, refreshment,
or accommodation therein without paying for his food,
refreshment, or accommodation. 3. Through any of the following fraudulent means: (a) By inducing another, by means of deceit, to sign
any document. (b) By resorting to some fraudulent practice to insure
success in a gambling game. (c) By removing, concealing or destroying, in whole or
in part, any court record, office files, document, or any
other papers.
Article 315 is a curious basis for this civil conversion
action. See supra note 37. None of its provisions appear to be
limited directly to mere unlawful dominion over another's
property. The most apposite would seem to be subsection (1)(b),
which defines as one permutation of estafa circumstances in which
a person "converts" property that has been "received in trust . .
. or under any other obligation involving the duty to return the
same[.]" Given the circumstances of this case, it is significant
that note 12 to Article 315 distinguishes estafa from the taking
of property by force or intimidation: The essential element of the crime of "estafa" consists
in the ingenuity or cunning employed by the agent for the
purpose of deceiving the one it is intended to victimize.
Obtaining property by fraud is, in a sense, obtaining it
against the true will of the owner, but not in the sense of
obtaining it by force or intimidation, as in robbery. It is therefore difficult, under Philippine law, to view estafa
as somehow coextensive or synonymous with conversion. However,
Imelda has not challenged the circuit court's jury instructions
regarding conversion. Thus, despite the fact that these
instructions appear confusing to us, we cannot, without
independent access to Philippine legal authority, rule as a
matter of law that Dilag's averment about Philippine law is
erroneous.
39. The parties' appellate briefs do not reveal where in the
record the circuit court's order and/or discussion regarding the
bifurcation of the trial as between legal and equitable issues is
located. Cf. Jenkins v. Cades Schutte Fleming & Wright, 76
Hawai`i 115, 119, 869 P.2d 1334, 1338 (1994) ("Neither the
parties nor counsel have a right to cast upon this court the
burden of searching a voluminous record for evidence of
finality[.]"); International Bhd. Of Elec. Workers v. Hawaiian
Tel. Co., 68 Haw. 316, 322-23 n.7, 713 P.2d 943, 950 n.7 (1986)
(counsel has no right to cast upon the court the burden of
searching through a voluminous record to find the ground for an
objection). However, it is clear that the trial was bifurcated
on this basis, and several comments made by the circuit court at
various points during the proceeding lead us to believe that the
court intended, as appropriate, to conduct further fact-finding
regarding the plaintiffs-appellees' equitable claims following
the return of the jury's verdict on the legal claims for relief. For example, in response to Imelda's motion in limine to
exclude evidence that Ferdinand had engaged in "resmelting
operations," the plaintiffs-appellees argued that the evidence
was relevant, inter alia, to their constructive trust claim
against the Marcoses. The circuit court ruled that, if there [are] any issues of equity such as whether or not a
constructive trust should be placed on the property, that
would be an issue for the Court to decide and would not be a
jury issue. . . . [T]he Court's responsibility is to only
permit relevant evidence for the fact finder. Ruling that resmelting was not relevant to the legal claim of
conversion, inasmuch as any conversion of Roxas's property would
have had to have taken place before any resmelting could occur,
the circuit court granted Imelda's motion in limine. By phrasing
its ruling in this way, the circuit court clearly implied that,
if evidence of resmelting were considered relevant to the
equitable claim of constructive trust, it would be considered
separately by the court after the jury's verdict was returned. Similarly, the circuit court granted the plaintiffs-appellees' motion to alter the judgment to expressly reserve
their equitable claims against Ferdinand, "so as to permit
further fact finding on the equitable issues . . . ." (Emphasis
added.)
0 See also George v. Coolidge Bank & Trust Co., 277 N.E.2d 278, 283 (Mass.
1971); National Sur. Corp. v. Hochman, 313 S.W.2d 776, 782 (Mo. Ct. App.
1958).
See also Nelson, 889 F.2d at 148 (stock conversion); Imperial
Sugar Co., Inc. v. Torrans, 602 S.W.2d 275, 276-77 (Tex. Ct. App.
1979) (conversion of sugar).
42. The plaintiffs-appellees also note that the Restatement
(Second) of Torts § 927 (1977) provides in relevant part that,
"in the case of commodities of fluctuating value customarily
traded on an exchange to which traders customarily resort,
[damages for conversion should be measured by] the hig[h]est
replacement value of the commodity within a reasonable period
during which he might have replaced it[.]" Comment (e) to that
section explains that "[t]he purpose of the exceptional rule is
to prevent defendants from appropriating and realizing the
speculative possibilities of a rise in market value without any
compensation to the plaintiff who is deprived of them." Comment
(e) further explains that the duration of the "reasonable period"
is "normally a question for the jury, subject to the control of
the court as in the case of other questions of fact." As
examples of courts following this rule, the plaintiffs-appellees
cite Quest v. Medical Inc. v. Apprill, 90 F.3d 1080, 1086 n.6
(5th Cir.) (applying Texas law to a stock conversion), reh'g
denied, 99 F.3d 1137 (5th Cir. 1996); Nelson v. All Am. Life &
Fin. Corp., 889 F.2d 141, 148 (8th Cir 1989) (applying Iowa law
to a stock conversion and holding that the value is the highest
price within a reasonable time, or until the time of bringing the
action, if not unreasonably delayed); and In re New York, 64 F.
Supp. 487, 491 (D. Conn. 1945). The plaintiffs-appellees cite further to the Restatement of
Restitution § 151 (1937), which provides that [w]here a person is entitled to a money judgment
against another because by fraud, duress or other
consciously tortious conduct the other has
acquired, retained or disposed of his property,
the measure of recovery for the benefit received
by the other is the value of the property at the
time of its improper acquisition, retention or
disposition, or a higher value if this is required
to avoid injustice where the property has
fluctuated in value or additions have been made to
it. (Emphasis added.) However, as Imelda points out, comment (c) to
section 151 explains that the higher value should be allowed "if
[the plaintiff] can prove that he probably would have made a sale
while the subject matter was at its highest point in value." See
also General Ins. Co. of Am. v. Commodity Credit Corp., 430 F.2d
916 (10th Cir. 1970) (adopting this rule).
43. We note that although the Klein court described the "New York
rule" as articulated by Brougham, supra, it did not adopt that
rule, applying instead the "Florida rule," which assigns the
value of a fluctuating commodity at a "reasonable time after
conversion." Klein, 151 So. 2d at 880.
44. See also Galigher v. Jones, 129 U.S. 193 (1889) (adopting the
New York rule as first articulated by the New York Court of
Appeals in Baker v. Drake, 53 N.Y. 211 (1873)); Schultz v.
Commodity Futures Trading Comm'n, 716 F.2d 136 (2d Cir. 1983)
(following Galigher). See generally, Annot., Measure of Damages
for Conversion of Corporate Stock or Certificate, 31 A.L.R.3d
1286 § 5(d) (1970) (collecting cases applying the New York rule).
46. We note that the "reasonable time" includes the date of the
conversion itself. See Schultz, 716 F.2d at 141.
47. As described supra, the New York rule excludes the period
between the time of conversion and the plaintiff's notice of the
conversion, and the "reasonable time" extends after the plaintiff
has notice. On the present record, it would be unnecessary to
instruct as to these distinctions, inasmuch as it was
uncontroverted that Roxas was present during the conversion of
the golden buddha and the gold bars, and, therefore, the moment
of the conversion and Roxas's notice of it were the same.