FOR PUBLICATION
IN
THE INTERMEDIATE COURT OF APPEALS
OF THE STATE OF HAWAI`I
---o0o---
BRYAN
TONEY and LILIBETH TONEY, Plaintiffs-Appellants,
v.
LAMOTO "RAY" FAUHIVA, doing business as
HAWAIIAN ISLE MASONRY, Defendant-Appellee
NO. 26693
APPEAL
FROM THE CIRCUIT COURT OF THE THIRD CIRCUIT
(CIVIL NO. 02-1-229K)
OCTOBER 28, 2005
BURNS, C.J., WATANABE AND NAKAMURA, JJ.
OPINION OF THE COURT BY BURNS, C.J.
Plaintiffs-Appellants Bryan Toney (Bryan) and Lilibeth Toney (collectively, the Toneys) appeal from the June 16, 2004 Final Judgment in favor of Defendant-Appellee Lemoto "Ray" Fauhiva (Fauhiva), and the July 14, 2004 Judgment awarding Fauhiva $8,245.25 for costs and $5,745.00 for attorney fees. (1) We affirm.The Toneys were owners of residential land located in the District of North Kona, Hawai`i, identified as Tax Map Key (3) 7-3-059:022 Lot 7-Q. During March 2002, the Toneys were in the process of constructing a residence on their property. They were operating pursuant to the "owner-builder" exception stated in Hawaii Revised Statutes (HRS) § 444-2(7) (Supp. 2004). During this time, the Toneys entered into a contract with Fauhiva, a licensed masonry contractor. In the contract, Fauhiva agreed to construct a retaining wall on the Toneys' property. Fauhiva completed construction of the retaining wall in April 2002. Later that year, on August 20 or 21, the retaining wall collapsed. (2)
On December 10, 2002, the Toneys filed a Complaint, in the Circuit Court of the Third Circuit, seeking damages "including but not limited to the cost to [the Toneys] of clearing of collapsed wall(s) and rubble and excavation for replacement wall(s); labor and materials for the failed and replaced wall(s); payment for damages to adjoining residential property upon which the walls collapsed; costs and attorneys fees, for all of which [Fauhiva] is liable."
By leave of the circuit court, the Toneys, on July 16, 2003, filed their First Amended Complaint for Damages. In their First Amended Complaint, the Toneys contended inter alia that Fauhiva had failed to comply with the disclosure requirements imposed by HRS § 444-25.5 (Supp. 2003). Specifically, they alleged:
9. The contracted matter and [Fauhiva] and [the Toneys'] relationship and activities referred to above are subject to and governed by Chapter 444 of the Hawaii Revised Statutes and particularly Section 444-25.5 thereof.
11. Because of [Fauhiva's] violation of an [sic] failure to comply with Chapter 441 [sic] and Section 444-25.5 thereof, [Fauhiva] has violated Chapter 480 of the Hawaii Revised Statutes, thereby entitling [the Toneys] to the relief provided by that Chapter.
A jury trial was held on February 24 and 25, and on March 2 and 3, 2004. At trial, at the conclusion of the Toneys' evidence, both parties moved for a directed verdict on the issue of the applicability of HRS § 444-25.5. The parties stipulated to the following: (1) the applicability of HRS Chapter 444 is solely a question of law; (2) the Toneys were owner-builders when they hired Fauhiva; (3) Fauhiva was a licensed contractor; and (4) HRS § 444-25.5 was not followed. Concluding that HRS Chapter 444 was not applicable, the circuit court orally granted Fauhiva's motion for directed verdict. The written order was filed on March 30, 2004.On a special verdict form, the jury determined that Fauhiva was negligent in constructing the retaining wall, Bryan was negligent in connection with the construction of the retaining wall, Fauhiva's negligence was a 30 percent cause of the damages, and Bryan's negligence was a 70 percent cause of the damages. On June 16, 2004, the circuit court entered a Final Judgment that stated, in relevant part:
Pursuant to the March 30, 2004 Order granting [Fauhiva's] Motion for Directed Verdict with Respect to [the Toneys'] Hawaii Revised Statues [sic] § 444-25.5 Claims, the jury special verdict entered on March 3, 2004 and good cause appearing therefor;
1. Final Judgment is entered in favor of [Fauhiva] with respect to all of [the Toneys'] claims and that [the Toneys] recover nothing herein.
3. There are no further claims or parties in Civil No. 02-1-0229K.
On April 7, 2004, Fauhiva filed a motion for an award of attorneys fees and costs. On June 10, 2004, the circuit court entered its Order Granting in Part [Fauhiva's] Motion for Costs and Attorneys' Fees awarding Fauhiva $8,245.25 for costs and $5,745.00 for attorney fees. A Judgment to this effect was entered on July 14, 2004.The Toneys filed a notice of appeal on July 16, 2004. An amended notice of appeal was subsequently filed on July 20, 2004. The appeal was assigned to this court on December 20, 2004.
In their opening brief, the Toneys contend:
A. The Circuit Court below erred in granting [Fauhiva's] motion for a directed verdict by its ORDER GRANTING DEFENDANT LEMOTO "RAY" FAUHIVA dba HAWAIIAN ISLE MASONRY'S MOTION FOR DIRECTED VERDICT WITH RESPECT TO PLAINTIFFS' HAWAII REVISED STATUES [sic] § 444-25.5 CLAIMS entered on March 3[0], 2004. . . .
C. The Circuit Court below erred in entering its Final Judgment entered on June 16, 2004, and its Judgment entered on July 14, 2004, by not including awards in [the Toneys'] favor as provided for by H.R.S § 444-25.5 and particularly subsection d) thereof, and H.R.S. Chapter 480.
The test of the validity of a directed verdict is whether the evidence is such that, after giving to plaintiffs' evidence all value to which it is legally entitled, and indulging every legitimate inference which may be drawn from the evidence in plaintiffs' favor, it can be said that there is no evidence to support a jury verdict in plaintiff's favor.
Lang v. Beech Aircraft Corp., 4 Haw. App. 237, 244, 663 P.2d 640, 644-45 (1983).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.
Nelson v. Univ. of Hawai`i, 97 Hawai`i 376, 393, 38 P.3d 95, 112 (2001) (brackets omitted) (quoting Carr v. Strode, 79 Hawai`i 475, 486, 904 P.2d 489, 500 (1995)).
Questions of statutory interpretation are questions of law to be reviewed de novo under the right/wrong standard.
[When construing a statute,] our foremost obligation is to ascertain and give effect to the intention of the legislature, which is to be obtained primarily from the language contained in the statute itself. And we must read statutory language in the context of the entire statute and construe it in a manner consistent with its purpose.
In construing an ambiguous statute, the meaning of the ambiguous words may be sought by examining the context, with which the ambiguous words, phrases, and sentences may be compared, in order to ascertain their true meaning. Moreover, the courts may resort to extrinsic aids in determining legislative intent. One avenue is the use of legislative history as an interpretive tool.
Lingle v. Hawai`i Gov't Employees Ass'n, AFSCME, Local 152, 107 Hawai`i 178, 183, 111 P.3d 587, 592 (2005) (internal quotation marks, brackets, and ellipses omitted) (quoting Guth v. Freeland, 96 Hawai`i 147, 149-50, 28 P.3d 982, 984-95 (2001)).
The title of HRS Chapter 444 (1993 & Supp. 2002) is "CONTRACTORS". It states, in relevant part:
§ 444-2 Exemptions. This chapter shall not apply to:
(7) Owners or lessees of
property who build
or improve residential, farm, industrial, or commercial buildings or
structures on property
for their own
use, or for use by their grandparents, parents, siblings, or children
and who do not offer the buildings or structures for
sale or lease;
provided that
this exemption shall not apply to electrical or plumbing work that must
be performed only by persons or
entities licensed
under this chapter,
or to
the owner or lessee of the property if the owner or lessee is licensed
under chapter 448E.
In all actions
brought under this paragraph, proof
of the
sale or lease, or offering for sale or lease, of the structure not more
than
one year after
completion is prima facie evidence that the
construction or
improvement of the structure was undertaken for the
purpose of sale or
lease; provided that this provision shall not apply to residential
properties
sold or leased to employees of the
owner or lessee;
provided further
that in order to qualify for this exemption the owner or lessee must
register for
the exemptions as
provided in section
444-9.1. Any owner or lessee of
property found to have violated this paragraph shall not be permitted
to
engage in any
activities pursuant to this paragraph or to register
under section 444-9.1 for a period of three years. There is a
presumption that an
owner or lessee has violated this section, when the owner or lessee
obtains an exemption from the licensing
requirements of
section 444-9
more than
once in two years[.]
§ 444-9 Licenses required. No person within the purview of this chapter shall act, or assume to act, or advertise, as general engineering contractor, general building contractor, or specialty contractor without a license previously obtained under and in compliance with this chapter and the rules and regulations of the contractors license board.
§ 444-9.1 Issuance of building permits; owner-builder registration. (a) Each county or other local subdivision of the State which requires the issuance of a permit as a condition precedent to the construction, alteration, improvement, demolition, or repair of any building or structure shall also require that each applicant for such a permit file as a condition to the issuance of a permit a statement that the applicant and all specialty contractors are licensed under this chapter, giving the license numbers and stating that the licenses are in full force and effect, or, if the applicant is exempt from this chapter, the basis for the claimed exemption; provided that if the applicant claims an exemption under section 444-2(7), the applicant shall also be required to certify that the building or structure is for the applicant's personal use and not for use or occupancy by the general public. Each county or local subdivision of the State shall maintain an owner-builder registration list which shall contain the following information: (1) the name of any owner or lessee who claims an exemption from this chapter as provided in section 444-2(7); (2) the address of the property where exempt building or improvement activity is to occur; (3) a description of the type of building or improvement activity to occur; (4) the approximate dates of construction activity; and (5) whether any electrical or plumbing work is to be performed and if so, the name and license number of the person or entity who will do the work. The absence of such registration is prima facie evidence that the exemption in section 444-2(7) does not apply.
(c) To qualify for the exemption under
section 444-2(7), the county shall provide the applicant with a
disclosure statement in substantially the
following form:
"Disclosure Statement
The county shall not issue a building permit to the owner-applicant until the applicant signs a statement that the applicant has read and understands the disclosure form.
(d) A county building inspector or other building official shall report to the regulated industries complaints office the name and address of any person, who, in the opinion of the building inspector or official, has violated this chapter by accepting or contracting to accomplish work which would classify the person as a contractor under this chapter.
. . . .
(1) Explain verbally in
detail to the
homeowner all lien rights of all parties performing under the contract
including the homeowner, the
contractor,
any subcontractor or any materialman supplying commodities or labor on
the project;
(3) Disclose all information pertaining to the contract and its performance and any other information that the board may require by rule.
(1) Contain the
information provided in
subsection (a) and any other relevant information that the board may
require by rule;
(2) Be signed by the contractor and the homeowner; and
(c) For the purpose of this section, "homeowner" means the owner or lessee of residential real property, including owners or lessees of condominium or cooperative units.
DISCUSSION
The Toneys challenge the circuit court's decision that HRS Chapter 444-25.5 is inapplicable in this case. In support of their contention that HRS § 444-25.5 is applicable, the Toneys rely on this court's prior holdings in Hiraga v. Baldonado, 96 Hawai`i 365, 31 P.3d 222 (App. 2001), and Jones v. Phillipson, 92 Hawai`i 117, 987 P.2d 1015 (App. 1999).
In Hiraga, the first issue was whether a licensed general contractor who failed to comply with the disclosure requirements of HRS § 444-25.5 was precluded from recovering in quantum meruit for work performed according to contract. See Hiraga, 96 Hawai`i at 372, 31 P.3d at 229. The answer was no.
In Hiraga, the second issue was whether a licensed contractor who failed to comply with the disclosure requirements of HRS § 444-25.5 was authorized to impose an HRS § 507-42 lien (for supplying labor and/or material) to the homeowner's property. For the following reason, the answer was no. HRS § 444-25.5(d) says that any violation of it "shall be deemed an unfair or deceptive practice and shall be subject to provisions of chapter 480[.]" HRS § 480-12 says that contracts in violation of HRS Chapter 480 are void. Thus, when contractor Hiraga violated HRS § 444-25.5, he also violated HRS § 480-12 and thereby voided the contract. Consequently, Hiraga was not authorized to impose an HRS § 507-42 lien on Baldonado's property.
In Jones, the issue before this court was whether an owner-builder's violation of the conditions for exemption contained in HRS § 444-2(7) prevented the owner-builder from bringing suit against an unlicensed contractor for breach of contract. See Jones, 92 Hawai`i at 127-28, 987 P.2d at 1025-26. The answer was no.
In the instant case, the construction of the Toneys' house and the subject retaining wall was being done by the Toneys pursuant to the owner-builder exemption stated in HRS § 444-2(7). This owner-builder exemption allows owners or lessees of property to act as their own general contractor without having to satisfy the licensing requirements imposed by HRS Chapter 444, so long as the structures or improvements built are for their or their close relative's personal use. Jones, 92 Hawai`i at 126, 987 P.2d at 1024.
The plain language of HRS § 444-2(7) states that HRS Chapter 444 "shall not apply to" "[o]wners or lessees of property who build or improve residential, farm, industrial, or commercial buildings or structures on property for their own use[.]" Clearly, that language means that the owner-builder is not required to comply with the requirements of HRS § 444-9 quoted above. On the other hand, it clearly does not mean that HRS § 444-9.1 quoted above does not apply to owner-builders. Does it mean that licensed subcontractors the owner-builder may or must hire, pursuant to HRS §§ 444-2(7) and -9.1, must comply with § 444-25.5 quoted above when dealing with owner-builders? In light of the language in HRS § 444-9.1 using the word "owner-builder", stating that the owner-builder is acting as his own general contractor even though he does not have a license, that the owner-builder must supervise the construction himself, that the owner-builder's construction must comply with all applicable laws, ordinances, building codes, and zoning regulations, and that "[t]he county shall not issue a building permit to the owner-applicant until the applicant signs a statement that the applicant has read and understands the disclosure form[,]" and the language in HRS § 444-25.5 that the disclosure it requires must be done "prior to the application for a building permit," we conclude that the answer is no.In other words, although owner-builders do not have most of the burdens imposed by HRS Chapter 444, they also do not have the benefits and protections of HRS Chapter 444. Therefore, pursuant to HRS § 444-2(7), the Toneys did not have the benefit of and, as to the Toneys, Fauhiva was not obligated to comply with the provisions of HRS § 444-25.5.
CONCLUSION
Accordingly, we affirm the March 30, 2004 Order Granting Defendant Lemoto "Ray" Fauhiva dba Hawaiian Isle Masonry's Motion for Directed Verdict, the June 16, 2004 Final Judgment, and the July 14, 2004 Judgment.
On the briefs:
Lamoto "Ray"
Fauhiva,
pro se
Defendant-Appellee
(Gregory K.
Markham and
Keith K. Kato,
Chee & Markham,
on the brief).
1. Judge Ronald Ibarra presided.
2. Plaintiff-Appellant Bryan Toney (Bryan) testified, in relevant part:
A. He said he needed to be paid in cash.
Q. Did you in fact pay him cash?
. . . .
A.
Yes.
Q.
And how much
were you making?
A. I make a hundred dollars a day, plus tips and fish money.
Q.
Okay. Could you
explain what job position you have that paid you that amount of money
at that time?
A.
I crew on a
boat. I'm a mate. Just take people fishing.
Q . . . Is it not correct, Mr. Fauhiva, that you had an agreement with Mr. Toney to build a retaining wall on his property?
Q And was that agreement for $6 a square foot plus Mr. Toney providing the materials?
. . . .
A Oh, lifetime supply.
A As much as he can.
Q After you capped the wall, how many square feet did you determine that you built?
Q Okay. And how much money was that?
Q The whole job?
Q That's the total of what you got?
. . . .
A Yes.
Q Did you intend the wall would only stay there for a few months, or longer?