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Posts Tagged ‘Commercial Litigation’

Hawaii Attorney Effie Steiger Selected As A Rising Star by Super Lawyers

Saturday, October 19th, 2013

Effie Steiger, of the Law Offices of Philip R. Brown, has been selected for the 2014 Hawaii Super Lawyers Rising Stars list.  Each year, no more than 2.5 percent of the lawyers in each state are selected by the research team at Super Lawyers to receive this honor.  This is the second prestigious honor received by Ms. Steiger.  The National Trial Lawyers Association also selected Ms. Steiger for its “Top 40 under 40” trial lawyers in Hawaii.

Steiger Photo

Super Lawyers, a Thomson Reuters business, is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional achievement.  The annual selections are made using a patented multiphase process that includes a statewide survey of lawyers, an independent research evaluation of candidates and peer reviews by practice area.  The result is a credible, comprehensive and diverse listing of exceptional attorneys.

The Super Lawyers lists are published nationwide in Super Lawyers Magazines and in leading city and regional magazines and newspapers across the country.  Super Lawyers Magazines also feature editorial profiles of attorneys who embody excellence in the practice of law.  For more information about Super Lawyers, visit SuperLawyers.com.

Effie Steiger is a litigation attorney who focuses on commercial litigation and personal injury cases.

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Honolulu Magazine Lists Philip R. Brown Among the Best Lawyers in Hawaii

Friday, December 7th, 2012

Philip R. Brown was once again listed in Honolulu Magazine’s annual issue of The Best Lawyers in Hawaii.

Philip Brown is also listed in The Best Lawyers in America.  Mr. Brown also has the highest ethical/legal rating (AV) from Martindale Hubbell.  Mr. Brown is also listed by the National Trial Lawyers Association in the Top 100 Trial Lawyers.  Mr. Brown is listed in the Bar Register of Preeminent Lawyers under Civil Trial Practice, Commercial Litigation, and Personal Injury.  This is the third consecutive year that Mr. Brown has been recognized in Honolulu Magazine as one of the Best Lawyers in Hawaii.

This was also a banner year for firm attorney Effie Steiger.  In 2012, the National Trial Lawyers recognized Effie Steiger as one of the “Top 40 Under 40” trial lawyers in Hawaii.

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Hawaii Attorney Philip R. Brown Rated AV Preeminent by Martindale Hubbell

Friday, February 3rd, 2012

Hawaii Attorney Philip R. Brown is proud to announce that he has once again received an AV Preeminent rating from his peers as recognized in the 2012 edition of Martindale Hubbell.  The AV rating is the “highest possible peer review rating for legal ability and ethical standards.”  According to Martindale Hubbell, the AV rating is the “pinnacle of professional excellence earned through a strenuous Peer Review Rating process that is managed and maintained by the world’s most trusted legal resource.”

Mr. Brown has been AV rated since 2000.  Below is a brief video about this achievement.

http://www.youtube.com/watch?v=XU2dwear13M&feature=youtube_gdata_player

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Agency Relationship in Hawaii

Tuesday, August 16th, 2011

A person may be held liable for the acts of another if an agency relationship is established.  According to the Hawaii Supreme Court, “an agency relationship may be created through actual or apparent authority.”  Cho Mark Oriental Food, Ltd. v. K & K Intern., 73 Haw. 509, 515-17 (1992) (Brackets and citations omitted.).  There are two types of actual authority; express actual authority and implied actual authority.  Id.  Express actual authority is created by an express agreement.  Id.  In the alternative, implied actual authority “may arise either independent of any express grant of authority or it may arise as a necessary or reasonable implication required to effectuate some other authority expressly conferred by the principal.”  Id.  “The focus is on the agent’s understanding of his authority inasmuch as the relevant inquiry is whether the agent reasonably believes, because of the conduct of the principal (including acquiescence) communicated directly or indirectly to him, that the principal desired him so to act.” Id.

With regard to apparent authority, the Hawaii Supreme Court held in Cho also held as follows:

Apparent authority arises when “the principal does something or permits the agent to do something which reasonably leads another to believe that the agent has the authority he was purported to have.”  The critical focus is not on the principal and the agent’s intention to enter into an agency relationship, but on whether a third party relies on the principal’s conduct based on a reasonable belief in the existence of such a relationship.  Apparent authority can occur under the following circumstances:

 (1)The principal has manifested his consent to the exercise of such authority or has knowingly permitted the agent to assume the exercise of such authority; (2). . . the third person knew of [the principal’s actions]. . .and, acting in good faith, had reason to believe, and did actually believe, that the agent possessed such authority; and (3) . . . the third person, relying on such appearance of authority, has changed his position and will be injured or suffer loss if the act done or transaction executed by the agent does not bind the principal.

Cho Mark Oriental Food, Ltd. v. K & K Intern., 73 Haw. at 516-17.  (Brackets and citations omitted.)

When an agent acts with apparent authority, “the principal can be vicariously liable to wronged third parties even when the agent acts wholly out of personal motive or with the purpose of defrauding his principal and even when the principal is innocent and deprived of any benefit.”  Premium Financing Specialists, Inc. v. Hullin, 90 S.W.3d 110, 113 (Mo.App.W.D. 2002).  It is important to make sure that anyone purportedly acting as your agent is acting in your best interests since you may be liable for his or her actions.

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Hawaii Attorney Philip Brown selected to the Best Lawyers in America

Monday, August 24th, 2009

Hawaii attorney Philip R. Brown has been selected by his peers to be included in the 2010 edition of The Best Lawyers in America. Obviously, he is delighted to have received this great honor.

“For over a quarter of a century, Best Lawyers has been regarded- by both the profession and the public-as the definitive guide to legal excellence in the United States. Selection to Best Lawyers is based on exhaustive and rigorous peer-review survey … by the top attorneys in the country.”

Admittedly, legal professionals may disagree as to the “definitive guide to legal excellence in the United States”. Best Lawyers, Martindale Hubbell , The Bar Register of Preemenient Lawyers and the American Trial Lawyers Association can all make solid claims to be the definitive guide to legal excellence. Philip Brown has now received the highest rating from each of those legal guides.

Philip Brown is listed in The Best Lawyers in America under Commercial Litigation. Mr. Brown has the highest ethical/legal rating (AV) from Martindale Hubbell. Mr. Brown is also listed by the American Trial Lawyers Association in the Top 100 Trial Lawyers. Finally, Philip Brown is listed in the Bar Register of Preeminent Lawyers under Civil Trial Practice, Commercial Litigation, and Personal Injury.

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Opportunity to Cure in a Services Contract

Tuesday, March 10th, 2009

A contracting party who fails to give proper notice and opportunity to cure any alleged breach, default, or defect (as expressly required in the contract) is in breach of the contract. See Kalaus v Prime Care Physician, 20 A.D. 3d 452, 454 (N.Y.A.D. 2 Dept., 2005)(Defendants breached the contract with plaintiff for failure to give plaintiff 30 days to cure plaintiff’s breach as expressly provided in the contract. Plaintiff was awarded summary judgment on the issue of liability). The party who is held in breach for failing to give proper notice and opportunity to cure also loses any of its claims or defenses related to the other party’s alleged breaches. Id. (“Based on the conclusion that that defendants breached the termination for cause provision of the employment agreement [for failing to give plaintiff notice of his breach and opportunity to cure], it is irrelevant whether the defendants did, in fact, have the requisite cause to terminate the plaintiff’s employment.”)(brackets added). See also The American Outdoorsman, Inc. v Pella Products, Inc., 144 P.3d 81, *8 (Kan.App., 2006)(“[E]ven if American Outdoorsman’s network change could be considered a material breach, Pella should not be allowed to assert this breach as a defense when it failed to give American Outdoorsman the opportunity to correct such breach.”) Likewise, “an injured party that acts precipitously and terminates before it is entitled to do so loses its defense as well as the possibility of claiming damages for total breach, and will itself be liable for damages for total breach.” Farnsworth on Contract section 8.18 (3d.ed., 2004).

Admittedly, the party breaching the contract could argue that (i) there was a mutual rescission of the agreement or (ii) it was orally modified. However, “to establish rescission by mutual consent, the contracting parties’ acts and declarations must be inconsistent with the continued existence of the previous contract.” AAA Uniform and Linen Supply, Inc. v. Barefoot, Inc., 17 S.W. 3d 627,629 (Mo.App. W.D. 2000) (emphasis added). Moreover, proof of these “acts and declarations” of “rescission must be clear, positive, unequivocal and decisive, and it must manifest the parties’ actual intent to abandon contract rights.” Id.

The second option, “a written contract can subsequently be orally modified if all of the requisites of a valid or enforceable agreement are met.” Honolulu Federal Sav. And Loan Ass’n v. Murphy 7 Haw.App 196, 205 (Haw.App.1988). “A requisite is that the modification must be supported by new consideration.” Id.

For a discussion of our Commercial Litigation Practice click
here .

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Truth in Lending Act in Hawaii

Tuesday, February 17th, 2009

The Truth in Lending Act (TILA) found in 15 U.S.C.A. section 1601, et. seq. was enacted to “protect consumers and promote the ‘informed use of credit.’” Washington v Americquest Mortgage.Co., 2006 WL 1980201, *6 (N.D.Ill., 2006). As such, TILA requires creditors to conspiciously disclose certain terms and costs information prior to a credit transaction. Id. This information includes, but is not limited to, the annual percentage rate and “finance charge,” order of disclosures, and use of different terminology. 15 U.S.C.A. section 1632(a).

The Statute of Limitation on a TILA action is one year for closed ended credit cases pursuant to 15 U.S.C.A. section 1640. The exception to the one year statute of limitation is when the remedy sought is to enforce the right of rescission under 15 U.S.C.A. section 1635. 15 U.S.C section 1635 provides that in any consumer credit transaction in which a security interest is retained or acquired in any real property which is used as the residence of the person to whom credit is extended, the obligor has the right to rescind the transaction until midnight of the third business day following the consummation of the transaction or the delivery of the disclosures required by the Truth in Lending Act, whichever is later, by notifying the creditor of his intention to rescind. 15 U.S.C section 1635. 15 U.S.C section 1635 applies to loans on unimproved lots that are intended for recreational or residential use. Charnita, Inc. v. F. T. C., 479 F.2d 684, 686-87, (C.A.3, 1973).

For a link to commercial litigation areas regularly practiced by this office please click here.

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Interference with Hawaii Business

Tuesday, February 10th, 2009

The tort of intentional interference with prospective economic advantage was examined by the Hawaii Supreme Court in Robert’s Hawaii School Bus, Inc. v Laupahoehoe Transp. Co., Inc.

The primary objective of the tort of interference with prospective business advantage or opportunity is the protection of legitimate and identifiable business expectancies… Weighing against social and individual interests in protection of business expectancies and efforts to acquire property are the interests in legitimate business competition. That is, much of the common law is premised on the theory that competitors should have an opportunity to compete for business until such time as it is cemented by contract or agreement. Public and individual interests in free competition become particularly acute where a plaintiff anticipates, but is not yet assured, that a contractual or firm business relationship will materialize. Where the plaintiff’s contractual relations are merely contemplated or potential, the public interest is best served by allowing any competitor the opportunity to divert those prospects to itself, so long as the means used are not themselves improper. Any contrary rule may tend to establish and perpetuate trade monopolies. As the “expectancy” becomes more remote or less firmly established, the interest in free competition among business persons becomes more compelling.

Robert’s Hawaii School Bus, Inc. v Laupahoehoe Transp. Co., Inc., 91 Hawaii 224, 258-59 (Hawaii, 1999)(superseded by statute as stated by Hawaii Medical Ass’n v. Hawaii Medical Service Ass’n, Inc., 113 Hawai’i 77 (Hawai’i, 2006) on unrelated grounds)(citing 2 Joseph D. Zamore, Business Torts 12.01[2], at 12-5 to 12-6 (1999) (footnotes omitted) (emphasis added).

Further, the Hawaii Supreme Court provided that,

[T]he following elements have evolved into the tort of intentional or tortious interference with prospective business advantage: (1) the existence of a valid business relationship or a prospective advantage or expectancy sufficiently definite, specific, and capable of acceptance in the sense that there is a reasonable probability of it maturing into a future economic benefit to the plaintiff; (2) knowledge of the relationship, advantage, or expectancy by the defendant; (3) a purposeful intent to interfere with the relationship, advantage, or expectancy; (4) legal causation between the act of interference and the impairment of the relationship, advantage, or expectancy; and (5) actual damages.

Id. (emphasis added).

In Robert’s Hawaii School Bus, Inc. v Laupahoehoe Transp. Co., Inc., the Hawaii Supreme Court used the above factors and upheld the trial court conclusion that plaintiff’s claim for intentional interference with prospective economic advantage failed since “there was insufficient evidence to show that: (1) such conduct was designed to disrupt appellants’ relationship with DAGS; (2) the relationship had the probability of ripening into a future economic benefit for STI; (3) STI would have been awarded the Big Island routes; and/or (4) STI was injured and suffered damages.”

In many cases, the tort of intentional interference with prospective economic advantage comes down to whether “absent the interference, the [prospective business] relations were reasonably likely to develop.” Looney v M-Squared, Inc., 586 S.E.2d 44, 49 (Ga.App., 2003). In Looney v M-Squared, Inc., the Court of Appeals of Georgia held that even with defendants’ interference, plaintiff corporation failed to show that plaintiff would have formed the alleged relationship. Looney v M-Squared, Inc., 586 S.E.2d at 49. Instead, the evidence showed that the corporation “decided not to pursue” that relationship. Id.

As noted, causation is also an element that must be established. “In order to be liable, a defendant’s interference must cause the loss or, in other words, a defendant’s conduct must not only qualify as improper interference, it must also actually induce the third party to terminate its relationship with the plaintiff.” The Film and Tape Works, Inc. v Junetwenty Films, Inc., 856 N.E.2d 612, 620-21 (Ill.App. 1 Dist., 2006) See also Gruber v. Victor, No. 95 CIV. 2285, 1996 WL 492991 at *21 (S.D.N.Y., August 28, 1996). “[T]o maintain an action for intentional interference with prospective economic advantage there must be some certainty that plaintiff would have gotten the contract but for the defendant’s interference.” (citing Mandleblatt v Devon Stores, Inc., 521 N.Y.S.2d 672, 677 (1st Dept., 1987)(internal quotation omitted).

In The Film and Tape Works, Inc. v Junetwenty Films, Inc., defendants produced evidence that the third party corporation would have done business with defendants regardless if defendants worked for plaintiff corporation or for themselves. Id. Basically, the third party would have done business with defendant regardless of the presence of plaintiff corporation. Id. As such, the Appellate Court of Illinois held that defendants’ action did not cause any damages to plaintiff. Id.

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Interference With Hawaii Contracts

Tuesday, July 29th, 2008

In certain specific cases, a Plaintiff may bring a claim if someone has interfered with a prospective business advantage. The Hawaii Supreme Court has addressed the required elements of this tort in Hawaii as:

[T]he following elements have evolved into the tort of intentional or tortious interference with prospective business advantage: (1) the existence of a valid business relationship or a prospective advantage or expectancy sufficiently definite, specific, and capable of acceptance in the sense that there is a reasonable probability of it maturing into a future economic benefit to the plaintiff; (2) knowledge of the relationship, advantage, or expectancy by the defendant; (3) a purposeful intent to interfere with the relationship, advantage, or expectancy; (4) legal causation between the act of interference and the impairment of the relationship, advantage, or expectancy; and (5) actual damages.

Robert’s Hawaii School Bus, Inc. v Laupahoehoe Transp. Co., Inc., 91 Hawaii 224, 258-59 (Hawaii, 1999).

With regards to determining whether there is a “valid business relationship or a prospective advantage or expectancy,” the law is well settled that a “unilateral belief and hope that a contract would result” is “inadequate to sustain a cause of action” for tortious interference with prospective business expectancy. Gore v Shepard, 50 P.3d 705, 710-11 (Wyo., 2002) “A reasonable probability of a contract [ie. business advantage] is shown if there is a reasonable assurance of a contract in view of all of the circumstances.” Id. (brackets added); See also, Sea-Pac Co., Inc. v United Food and Commercial Workers Local Union 44, 699 P.2d 217, 220 (Wash., 1985)(“the plaintiff must show that the future opportunities and profits are a reasonable expectation and not based on merely wishful thinking.”).

Moreover, the Defendant must have actually caused Plaintiff to lose a prospective business advantage. Proof of causation comes down to whether “absent the interference, the [prospective business] relations were reasonably likely to develop”. Looney v M-Squared, Inc., 586 S.E.2d 44, 49 (Ga.App., 2003). Therefore, “in order to be liable, a defendant’s interference must cause the loss or, in other words, a defendant’s conduct must not only qualify as improper interference, it must also actually induce the third party to terminate its relationship with the plaintiff.” The Film and Tape Works, Inc. v Junetwenty Films, Inc., 856 N.E.2d 612, 620-21 (Ill.App. 1 Dist., 2006) See also Gruber v. Victor, No. 95 CIV. 2285, 1996 WL 492991 at *21 (S.D.N.Y., August 28, 1996). “[T]o maintain an action for intentional interference with prospective economic advantage there must be some certainty that plaintiff would have gotten the contract but for the defendant’s interference.” (citing Mandleblatt v Devon Stores, Inc., 521 N.Y.S.2d 672, 677 (1st Dept., 1987)(internal quotation omitted).

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Theft of a Corporate Opportunity

Tuesday, November 6th, 2007

We have represented clients alleged to have been involved in a “theft of a corporate opportunity.” As most people know, “a corporate officer or director is under a fiduciary duty of individual loyalty, good faith and fair dealing in conducting corporate business.” Racine v Weisflog, 477 N.W.2d 326, 329 (Wis App., 1991). One of the primary duties is that a corporate officer cannot divert assets of the corporation and use them for the officer’s personal advantage.

In Hawaii, the “corporate opportunity” doctrine has been explained as follows:

If there is presented to a corporate officer or director a business opportunity which the corporation is financially able to undertake, is, from it nature, in the line of the corporation’s business and is of practical advantage to it, is one in which the corporation has an interest or a reasonable expectancy, and, by embracing the opportunity, the self-interest of the officer or director will be brought into conflict with that of his corporation, the law will not permit him to seize the opportunity for himself.

Lussier v Mau-Van Development, Inc., 4 Haw.App. 359, 368 (Hawaii App., 1983)(Citing Guth v Loft, Inc., 5 A.2d 503, 511 (Del.Ch., 1939).

If an officer or director diverts a “corporate opportunity” for his or her own personal gain, then such action may constitute a breach of the officer or director’s fiduciary duty to the corporation (ie. the duty of loyalty). The damages for such breach may include, (i) recovery of any profits earned (usually with the imposition of a constructive trust on the property taken), (ii) compensatory damages, and/or (iii) injunctive relief.

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