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Oral Argument Before the Hawaii Supreme Court

(Amended 12/07/15)

No. SCWC-13-0000531, Thursday, January 21, 2016, 11:15 a.m.

WILLIAM A. ARTHUR, SR., Individually, and THE ESTATE OF MONA ARTHUR thru William A. Arthur, Sr. as the Personal Representative, Respondents/Plaintiffs-Appellants/Cross-Appellees, vs. STATE OF HAWAI`I, DEPARTMENT OF HAWAIIAN HOME LANDS; KAMEHAMEHA INVESTMENT CORPORATION; DESIGN PARTNERS INC., Respondents/Defendants-Appellees/Cross-Appellees, and COASTAL CONSTRUCTION CO., INC., Respondent/Defendant-Appellee/Cross-Appellant; SATO AND ASSOCIATES, INC.; and DANIEL S. MIYASATO, Petitioners/Defendants-Appellees/Cross-Appellants; KAMEHAMEHA INVESTMENT CORPORATION, Respondent/Third-Party Plaintiff-Appellee/Cross-Appellee, vs. KIEWIT PACIFIC CO., Respondent/Third-Party Defendant-Appellee/Cross-Appellee. KIEWIT PACIFIC CO., Respondent/Fourth-Party Plaintiff-Appellee/Cross-Appellee, vs. PACIFIC FENCE, INC., Respondent/Fourth-Party Defendant-Appellee/Cross-Appellee.

The above-captioned case was set for argument on the merits at:

Supreme Court Courtroom
Ali`iolani Hale, 2nd Floor
417 South King Street
Honolulu, HI 96813

Attorneys for Petitioners Sato and Associates, etc.:

Kevin P.H. Sumida, Frank K. Goto, Jr., Bennett J. Chin, Jane Kwan, Anthony L. Wong and Lance S. Au

Attorneys for Respondent Kamehameha Investment:

Brad S. Petrus, Joseph F. Kotowski, David R. Harada-Stone and Lyle M. Ishida

Attorneys for Respondent Coastal Construction:

Wayne M. Sakai, Michiro Iwanaga, and Max J. Kimura

Attorneys for Respondent Pacific Fence:

Robert P. Richards, Michael N. Tanoue, and Christina Y. Bae

Attorneys for Respondent State of Hawaii, DHHL:

Randall Y. Yamamoto and Brian Y. Hiyane

Attorneys for Respondent Kiewit Pacific:

Cary T. Tanaka, Dawn M. Nakagawa, Greg H. Takase, Wesley H.H. Ching and Sheree Kon-Herrera

Attorneys for Respondent Arthur:

Lester K.M. Leu, Gary Y. Okuda, Karyn A. Doi and Leighton K. Lee

Attorneys for Respondent Design Partners:

Arthur H. Kuwahara

Attorneys for Respondent Kalawahine Streamside:

Jonathan L. Ortiz, Wade J. Katano, and Christine S. Prepose-Kamihara

NOTE: Order accepting Application for Writ of Certiorari, filed 09/18/15.

NOTE: Certificate of Recusal, by Associate Justice Paula A. Nakayama, filed 11/23/25.

NOTE: Order postponing oral argument, filed 11/24/15. (Rescheduled from 12/03/15, 10:00 a.m. to 01/21/16, 11:15 a.m.)

NOTE: Order assigning Circuit Court Judge R. Mark Browning, in place of Nakayama, J., recused, filed 12/03/15.

COURT: MER, CJ; SSM, RWP, and MDW, JJ., and Circuit Court Judge Browning, in place of Nakayama, J., recused.

[ Listen to the entire audio recording in mp3 format ]

Brief Description:

This case is a contract dispute between Petitioners/Defendants-Appellees/Cross-Appellants Sato and Associates, Inc. and Daniel S. Miyasato (collectively, “Sato” or “Engineer”), and Respondent/Defendant-Appellee/Cross-Appellee Kamehameha Investment Corporation (“KIC” or “Developer”). Sato timely applied for writ of certiorari (“Application”) on August 7, 2015 from a June 8, 2015 Judgment entered by the Intermediate Court of Appeals (“ICA”) pursuant to its February 27, 2015 Opinion (“Opinion”). In relevant part, the ICA affirmed the Circuit Court of the First Circuit’s (“circuit court[’s]”) “Order Granting Defendant and Third-Party Plaintiff Kamehameha Investment Corporation’s Motion for Partial Summary Judgment Against Defendant Sato & Associates, Inc. . . .” filed May 27, 2011, insofar that it held, among other things, that “Defendant Sato had a joint and several duty to defend Defendant and Third-Party Plaintiff KIC from December 15, 2005.”

Heavily relying on Pancakes of Hawaii, Inc. v. Pomare Properties Corp., 85 Hawai`i 286, 944 P.2d 83 (App. 1997), the ICA concluded that pursuant to the Project Consultant Agreement (“Agreement”) between Sato and KIC, Sato had a duty to defend KIC in the wrongful death action brought by Respondents/Plaintiffs-Appellants/Cross-Appellees, William A. Arthur, Sr. (“William”) and the Estate of Mona Arthur (collectively, “Arthurs”) upon KIC’s tender of defense to Sato. The Arthurs had resided at the Kalawahine Streamside Housing Development that was developed by KIC, wherein KIC had contracted with Sato to serve as the project’s civil engineer. In their wrongful death suit, the Arthurs alleged, among other things, that Mona fell on the property and ultimately died from her injuries; and Mona’s death was due to the negligence of KIC, Sato, and other parties. A second amended complaint also raised a claim for punitive damages against KIC.

In its Application, Sato presented two questions: (1) “Was Pancakes wrongly decided?” (2) “In applying Pancakes, did the ICA fail to strictly construe the indemnity contracts at issue by treating Sato and other contractual indemnitors as insurers and the subject indemnity contracts as insurance policies?” Upon accepting the Application, this court further ordered the parties to address the following two issues in supplemental briefs:

(1) Is the duty to defend presented in Sato’s non-insurance, construction contract with KIC coextensive with Sato’s duty to indemnify?

(2) Given case law and legislative history, does Hawai?i Revised Statutes § 431:10-222 (2005), render void any provision in a construction contract requiring the promisor to defend “the promisee against liability for bodily injury to persons or damage to property caused by or resulting from the sole negligence or wilful misconduct of the promisee, the promisee’s agents or employees, or indemnitee?”