Sprengeler v. D.R. Horton Hawaii, LLC

NOT FOR PUBLICATION IN WEST'S HAWAI I REPORTS AND PACIFIC REPORTER

Electronically Filed
Intermediate Court of Appeals
CAAP-XX-XXXXXXX
19-SEP-2024
08:20 AM
Dkt. 44 OGMD
NO. CAAP-XX-XXXXXXX

IN THE INTERMEDIATE COURT OF APPEALS

OF THE STATE OF HAWAI I

LINDA L. SPRENGELER; TIMOTHY J. HARRIS; KIMBERLY H. HARE;
NICHOLAS KLAUBA; BRIGITTE A. CARREAU; DEVON A. CROWELL;
JONATHAN G. NUNEZ; AMANDA J. NUNEZ; MATTHEW R. WOODS;
LANI SAIKI-WOODS, Individually and as Next Friend for C.W.;
RUDOLPH D.K. DUNCAN; KAHANAALOHA KUIKAHI-DUNCAN;
MARC VOLKMER, Individually and as Next Friend for V.V.;
CHRISTIE K. VOLKMER; MARK E. SMYTH; JAYE MOREAU;
NOELANI L. PLANAS; and CORINNE K. MOKIAO,
Plaintiffs-Appellees, v.
D.R. HORTON HAWAII, LLC, dba D.R. HORTON-SCHULER DIVISION,
Defendant-Appellant, and
DORVIN D. LEIS CO., INC., Defendant-Appellee, and
JOHN DOES 1-20; JANE DOES 1-20; and DOE ENTITIES 1-20, Defendants

APPEAL FROM THE CIRCUIT COURT OF THE FIFTH CIRCUIT
(CIVIL NO. 5CCV-XX-XXXXXXX)

ORDER GRANTING MOTION TO DISMISS APPEAL
(By: Leonard, Acting Chief Judge, McCullen and Guidry, JJ.)
Upon consideration of the Motion to Dismiss Appeal for
Lack of Jurisdiction (Motion to Dismiss) filed June 4, 2024, by
Plaintiffs-Appellees Linda L. Sprengeler, Timothy J. Harris,
Kimberly H. Hare, Nicholas Klauba, Brigitte A. Carreau, Devon A.
Crowell, Jonathan G. Nunez, Amanda J. Nunez, Matthew R. Woods,
Lani Saiki-Woods, Individually, and as Next Friend for C.W.,
Rudolph D.K. Duncan, Kahanaaloha Kuikahi-Duncan, Marc Volkmer,
Individually, and as Next Friend For V.V., Christie L. Volkmer,
Mark E. Smyth, Jaye Moreau, Noelani L. Planas, and Corinne L.
Mokiao (Appellees), the papers in support and in opposition, and
the record, it appears Appellees seek dismissal of the appeal for
NOT FOR PUBLICATION IN WEST'S HAWAI I REPORTS AND PACIFIC REPORTER

lack of jurisdiction on the basis that the "Order Denying
Defendant[-Appellant] D.R. Horton Hawaii dba D.R. Horton-Schuler
Division's [(Appellant)] Motion To Dismiss Complaint, Filed
November 10, 2023 [Dkt. 1] or in the Alternative Stay Proceedings
and Compel Individual Arbitrations, Filed March 21, 2024 [Dkt.
55]" (Arbitration Order) is not an appealable order. The
Arbitration Order stayed the case, directed the parties to engage
in a consolidated arbitration, and denied Appellant's requests to
dismiss the case and/or compel the parties to individual
arbitrations.
The parties do not dispute that the purchase agreements
at issue in the underlying case contain "Dispute Resolution"
clauses under which any disputes arising from the sale of the
subject properties "shall be arbitrated pursuant to the [Federal
Arbitration Act (FAA)]." Consistent with the parties'
expectations under the purchase contracts, we apply the FAA's
procedural rules in determining whether we have appellate
jurisdiction. See Gabriel v. Island Pacific Academy, Inc., 140
Hawai i 325, 333, 400 P.3d 526, 534 (2017) (determining that the
choice-of-law provision in the contract at issue in the
underlying case dictated the procedural rules governing an appeal
from an order concerning arbitration).
Appellant contends that the court should construe the
Arbitration Order as a denial of a motion to compel individual
arbitrations, which it contends is appealable under the FAA
pursuant to 9 U.S.C. § 16(a)(1)(C) or 9 U.S.C. § 16(a)(3). 1

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9 U.S.C. § 16, which governs appeals under the FAA states, in
relevant part,

(a) An appeal may be taken from--

(1) an order--

. . . .

(C) denying an application under section
206 of this title to compel arbitration,
[or]

. . . .

(3) a final decision with respect to an
(continued...)

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NOT FOR PUBLICATION IN WEST'S HAWAI I REPORTS AND PACIFIC REPORTER

The term "final decision" as used in 9 U.S.C.
§ 16(a)(3) refers to "a decision that ends the litigation on the
merits and leaves nothing more for the court to do but execute
the judgment," such as an order directing the parties to proceed
to arbitration and dismissing all claims in the underlying
action. Green Tree Financial Corp.-Alabama v. Randolph, 531 U.S.
79, 86 (2000). Here, the circuit court expressly declined to
dismiss the complaint, and it further ordered that the "action is
stayed pending completion of the consolidated arbitration" and
that it "shall continue to have oversight ability over this
action during the pendency of the stay." Thus, the Arbitration
Order is not appealable under 9 U.S.C. § 16(a)(3).
Moreover, the Arbitration Order is not the type of
order denying arbitration contemplated in 9 U.S.C. § 16(a)(1)(C).
The effect of the Arbitration Order was not to deny an
application that arbitration be held in accordance with the
purchase agreement, but to reject Appellant's argument as to the
form of arbitration contemplated in the purchase agreement, and
further, to stay the case and affirmatively order the parties "to
consolidated arbitrations pursuant to the Purchase Contracts."
See Bushley v. Credit Suisse First Boston, 360 F.3d 1149, 1153-54
(9th Cir. 2004) (holding that the denial of a request to compel
arbitration under the movant's first-choice forum was not an
appealable order denying arbitration under 9 U.S.C. § 16(a)(1)(B)
or (C) because the district court nonetheless ordered arbitration

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(...continued)
arbitration that is subject to this title.

(b) Except as otherwise provided in section 1292(b) of title
28, an appeal may not be taken from an interlocutory order--

(1) granting a stay of any action under section
3 of this title;

(2) directing arbitration to proceed under
section 4 of this title;

(3) compelling arbitration under section 206 of
this title; or

(4) refusing to enjoin an arbitration that is
subject to this title.

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NOT FOR PUBLICATION IN WEST'S HAWAI I REPORTS AND PACIFIC REPORTER

to proceed, "albeit not in the 'first-choice' . . . forum
requested.").
We therefore conclude the Arbitration Order is not
appealable under the FAA. Consistent with the plain language of
9 U.S.C. § 16, we further conclude the Arbitration Order is not
appealable under the collateral order doctrine. See Johnson v.
Consumerinfo.com, Inc., 745 F.3d 1019, 1021–22 (9th Cir. 2014)
("The structure of the statute . . . suggests that Congress
intended to remove appellate jurisdiction from all orders listed
in § 16(b)(1)-(4), regardless of whether any such order could
otherwise be deemed collateral.").
Therefore, IT IS HEREBY ORDERED that Appellees' Motion
to Dismiss is granted, and the appeal is dismissed for lack of
jurisdiction.
DATED: Honolulu, Hawai i, September 19, 2024.

/s/ Katherine G. Leonard
Acting Chief Judge

/s/ Sonja M.P. McCullen
Associate Judge

/s/ Kimberly T. Guidry
Associate Judge

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