Shin v Fujita Kanko Guam, Inc [2009] GUSC 21; 2009 Guam 21 (31 December 2009)

IN THE SUPREME COURT OF GUAM

HEE K. CHO AND TUMON PARTNERS, LLC
Proposed Intervenor-Appellants in

KEVIN SHIN,
Plaintiff-Appellee,

V

FUJITA KANKO GUAM, INC.,
Defendant-Appellee

Superior Court Case No. CV1240-05

SECURITY TITLE, INC.,
Plaintiff-Appellee

V

FUJITA KANKO GUAM, INC. AND KEVIN SHIN,
Defendant-Appellees

Superior Court Case No. CV0001-06
Supreme Court Case No.: CVA08-002

OPINION

Filed: December 31, 2009
Cite as: 2009 Guam 21

Appeal from the Superior Court of Guam
Argued and submitted on March 17, 2009
Hagåtña, Guam

Appearing for Proposed Intervenor-Appellants: James L. Canto II, Esq. SHIMIZU CANTO & FISHER Suite 101 De La Corte Bldg. 167 E Marine Corps Dr. Hagåtña, GU 96910 Appearing for Plaintiff-Appellee: Louie J. Yanza, Esq. MAHER YANZA FLYNN TIMBLIN, LLP 115 Hesler Pl., Ground Flr. Gov. Joseph Flores Bldg. Hagåtña, GU 96910

Appearing for Defendant-Appellee: Richard L. Johnson, Esq. BLAIR STERLING JOHNSON MARTINEZ & LEON GUERRERO A Professional Corp. Ste. 1008 DNA Bldg. 238 Archbishop F.C. Flores St. Hagåtña, GU 96910-5205 Elyze J. McDonald, Esq. CARLSMITH BALL LLP Bank of Hawaii Bldg., Ste. 401 134 W Soledad Ave. P.O. Box BF Hagåtña, GU 96932-5027

BEFORE: ROBERT J. TORRES, Chief Justice; F. PHILIP CARBULLIDO, Associate Justice; and RICHARD H. BENSON, Justice Pro Tempore.

TORRES, C.J.

[1] Appellants and Applicants in Intervention Hee K. Cho and Tumon Partners, LLC ("Cho/TPLLC") appeal from the denial of their motion to intervene in a lawsuit filed by Kevin Shin against Fujita Kanko Guam, Inc. ("Fujita"). In the underlying action, Shin sought specific performance or damages for anticipatory breach and repudiation of an agreement for the purchase and sale of certain real property located in Tumon, Guam. Because we find Cho/TPLLC failed to meet their burden of demonstrating a significantly protectable interest to support their claimed right to intervene, we find no error in the Superior Court’s denial of intervention of right or permissive intervention. The judgment below is AFFIRMED.

I. FACTUAL AND PROCEDURAL BACKGROUND

[2] Defendant-Appellee Fujita entered into an agreement ("the Agreement") on October 12, 2005 for the sale of twenty parcels of land to Plaintiff-Appellee Kevin Shin. The land in question is located at the site of the former Fujita Hotel in Tumon, Guam (the "Property"). Proposed Intervenor-Appellants’ Excerpts of Record ("ER") at 1-2 (Verified Compl. for Anticipatory Breach and Repudiation, Specific Performance, and Breach of Contract and Damages, Dec. 12, 2005). Shin agreed to purchase the Property for $8,250,000.00, with a $300,000.00 deposit to be credited to the purchase price at closing. ER at 14-36 (Verified Compl., Ex. B, "Agreement for Sale of Real Property," Dec. 12, 2005 ) ("Agreement").

[3] The Agreement required the closing to occur no later than 60 days from signing, at 10 a.m. (Guam time). ER at 19 (Agreement). A provision stated the Agreement was not assignable by Shin without Fujita’s consent. ER at 24 (Agreement).¹ Another clause stated the Agreement may not be amended except by a writing signed by both parties. ER at 25 (Agreement). In the event of a material default by either party, the non-defaulting party’s "sole and exclusive remedy" was to cancel the Agreement by written notice to the other party and to Escrow, whereupon the Deposit and accrued interest would be immediately disbursed to the non-defaulting party. ER at 21 (Agreement).² Time was of the essence. ER at 24 (Agreement).

[4] Appellant and applicant for intervention Hee K. Cho ("Cho") alleges that in November of 2005, he entered into a separate, oral agreement with Shin, by which he agreed to provide funding to enable Shin to close the purchase of the Property if Shin’s investors were unable to provide the necessary funds on time ("November Agreement"). ER at 53 (Decl. Hee K. Cho, May 29, 2007). In exchange, Cho "would have rights to part of the property, and Mr. Shin would have rights to part of the property." Id.

[5] The parties dispute what happened next. Shin’s complaint alleges that Shin and Fujita orally modified the Agreement, mutually agreeing to extend the closing date an additional 90 days (the "Extended Closing Date"). ER at 2 (Verified Compl.). Shin alleges that as the closing date drew near, he demanded Fujita’s compliance with the 90-day extension and Fujita had stated it did not intend to comply. Id. Fujita denies ever agreeing to an extension. See Defendant-Appellee’s Supplemental Excerpts of Record ("Defendant-Appellee’s SER") at 3 (Aff. Tamio S. Clark, June 20, 2007); Defendant-Appellee’s SER at 5 (Decl. Tamio S. Clark, Sept. 13, 2006). However, it is undisputed that when the closing date written in the Agreement drew near, Cho did not fund the purchase price. Cho claims he did not provide the funding on or prior to December 12, 2005 because Fujita never issued a demand. Id. His declaration alleges that if Fujita had issued a written demand to Shin for performance for nonpayment, Cho was prepared to advance sufficient funds to Mr. Shin to close the transaction. ER at 54 (Decl. Cho).

[6] On the closing date specified by the Agreement, at 1:14 p.m., Shin filed the complaint for anticipatory breach and repudiation and lis pendens with the Superior Court. ER at 1 (Verified Compl.). Fujita alleges that Shin filed the complaint prior to its receipt of written notice of material default. Defendant Appellee’s SER at 5-9 (Decl. Clark).