In Re Kekauoha-Alisa

This case requires us to determine whether a mortgage company violated Hawaii state law when it did not publicly announce the postponement of a foreclosure sale of property owned by Appellant Margery Kanamu-Kalehuanani Kekauoha-Alisa, and if so, to ascertain the proper remedy for that violation. A federal bankruptcy court held that Appellees’ failure publicly to announce the foreclosure violated the requirements of Hawaii’s nonjudicial foreclosure procedure under Hawaii Revised Statute (HRS) § 667-5, as well as its consumer protection law, HRS § 480-2. The court voided the sale of the Appellant’s property and awarded her treble damages of $417,761.66 under HRS § 480-13 for violation of the consumer protection statute. The Bankruptcy Appellate Panel reversed, ruling that the mortgagee’s actions did not violate state law.

We hold that (1) the lack of public announcement did violate Hawaii’s nonjudicial foreclosure statute, and (2) this defect was a deceptive practice under state law. Accordingly, we affirm the bankruptcy court’s avoidance of the foreclosure sale. However, we remand to the bankruptcy court for a proper calculation of attorneys’ fees and damages under HRS §…