The Hawaii Intermediate Court of Appeals overturned an award of attorney fees in a declaratory relief action filed by the insurer. See Allstate Ins. Co. v. Silva, 2010 Haw. App. LEXIS 806 (Haw. Ct. App. Dec. 9, 2010).
Silva was injured on his motorcycle when struck by an auto driven by Ponce. Silva sued Ponce for negligence and requested, among other relief, reasonable attorney fees. Ponce defaulted. Silva wrote to Ponce's auto insurer, Allstate, requesting its position on the matter.
Allstate filed an action for declaratory relief, seeking to establish that neither Ponce nor Silva were entitled to coverage. The Circuit Court granted declaratory relief to Allstate. The Hawaii Supreme Court vacated the Circuit Court's decision, holding that Allstate had a duty to defend and/or indemnify under the policy. Allstate then paid $25,000 to Silva, the policy limits for bodily injury.
Two years later, Silva filed a motion for entry of judgment and attorney fees. Allstate opposed the motion, arguing the case was moot because policy limits had been paid. Further, Allstate argued attorney fees were unavailable under Haw. Rev. Stat. 607-14 because its declaratory relief action was not in the nature of assumpsit, as required by the assumpsit fee statute.
Nevertheless, the Circuit Court granted the request for Entry of Judgment and Silva's request for fees under Haw. Rev. Stat. 607-14. Ponce had assigned to Silva all claims for relief Ponce had against Allstate, including a breach of contract claim based on Allstate's initial failure to pay the liability claim.
The ICA vacated the judgment and award of fees. Allstate only sought a declaration as to its rights or responsibilities as the insurer, not money damages. Thus, its declaratory relief action was not in the nature of assumpsit and the Circuit Court erred in awarding fees to Silva under Haw. Rev. Stat. 607-14.
