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Feb. 27, 2026 Get Citation Alerts Download PDF Add Note

Walley Isle Motors, LTD. v. La Costa

Hawaii Intermediate Court of Appeals

• Citations: None known

• Docket Number: CAAP-23-0000729

• Opinion

• Authorities (6)

• Cited By (0)

• Summaries (0)

• Similar Cases (15.7K)

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Combined Opinion

NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

Electronically Filed
Intermediate Court of Appeals
CAAP-XX-XXXXXXX
27-FEB-2026
07:58 AM
Dkt. 77 MO

NO. CAAP-XX-XXXXXXX

IN THE INTERMEDIATE COURT OF APPEALS
OF THE STATE OF HAWAI#I

VALLEY ISLE MOTORS, LTD.,
Plaintiff/Counterclaim Defendant-Appellant,
v.
P. DENISE LA COSTA, Defendant/Counterclaimant-Appellee

APPEAL FROM THE DISTRICT COURT OF THE SECOND CIRCUIT
WAILUKU DIVISION
(CASE NO. 2DRC-XX-XXXXXXX)

MEMORANDUM OPINION
(By: Hiraoka, Presiding Judge, Wadsworth and McCullen, JJ.)
Valley Isle Motors, Ltd. appeals from the Judgment for
P. Denise La Costa entered by the District Court of the Second
Circuit, Wailuku Division, after a bench trial.1 We vacate the
Judgment and remand for entry of an amended judgment.

BACKGROUND

Valley Isle sued La Costa for $7,567.20. The amended
complaint alleged that La Costa "had service work performed at
her request by Valley Isle Motors which work was approved by her
insurer State Farm which issued checks for the approved work.
[La Costa] caused payment to be stopped on the State Farm
checks."

1
The Honorable Lance D. Collins presided.
NOT FOR PUBLICATION IN WEST'S HAWAI#I REPORTS AND PACIFIC REPORTER

La Costa counterclaimed for a "minimum of $21,000 for
[d]amages to [her] vehicle while in the care and custody of
[Valley Isle], and failure by [Valley Isle] to properly repair
[her] vehicle."
After a three-day bench trial, the District Court
entered findings of fact, conclusions of law, and a decision and
order. The Judgment for La Costa, for $10,325.05 plus $2,581.26
in attorney fees, was entered on November 20, 2023. This appeal
followed.

POINTS OF ERROR

Valley Isle contends the trial court erred by
(1) denying its claim for the cost of repairing the sunroof of
La Costa's car, (2) allowing La Costa to call "a previously
undisclosed 'rebuttal' witness to testify as an expert";
(3) ruling that the sunroof repair was covered under the
manufacturer's warranty; (4) awarding damages for the center
instrument panel; and (5) awarding attorney fees. It challenges
findings of fact [FOF] nos. 2-9, 13-15, and 19, and conclusions
of law [COL] nos. 1-9.

STANDARDS OF REVIEW

We review findings of fact under the clearly erroneous
standard. Cowan v. Exclusive Resorts PBL1, LLC, 156 Hawai#i 268,
272, 574 P.3d 288, 292 (2025). A finding of fact is clearly
erroneous if the record lacks "credible evidence which is of
sufficient quality and probative value to enable a person of
reasonable caution to support a conclusion[,]" or if we are "left
with a definite and firm conviction that a mistake has been
made." Est. of Klink ex rel. Klink v. State, 113 Hawai#i 332,
351, 152 P.3d 504, 523 (2007).

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Conclusions of law are not binding on an appellate
court, and are reviewed de novo. Cowan, 156 Hawai#i at 272, 574
P.3d at 292. But a conclusion presenting mixed questions of fact
and law is reviewed under the clearly erroneous standard because
it implicates the facts and circumstances of that case. Id.
We review an order granting or denying attorney fees
for abuse of discretion. Cowan, 156 Hawai#i at 272, 574 P.3d at
292. A court abuses its discretion if it clearly exceeds the
bounds of reason or disregards rules or principles of law or
practice to the substantial detriment of a party litigant. Id.

DISCUSSION

The trial evidence showed that La Costa bought a
Lincoln from Jim Falk Valley Isle Motors on March 11, 2019. It
was in an accident on September 13, 2019. La Costa took it to
Precision Auto Body. [Id.] The damage was repaired and La Costa
picked the Lincoln up the Wednesday before Thanksgiving. As she
was driving home, she noticed the instrument panel lights were
out. She took the Lincoln back to Precision, but was told "this
isn't what we can fix." She had the Lincoln towed to Valley Isle
on December 4, 2019.
La Costa testified that Valley Isle "had my vehicle for
three and a half months, and the issue was not fixed by them."
La Costa then had the Lincoln towed to Studio Auto Body. She
testified, "it was returned to me fixed." State Farm paid Studio
$6,358.08.
La Costa picked the Lincoln up from Studio on April 22,
2020. She tried to open the sunroof while she was driving, but
it wouldn't open. She took the Lincoln to Valley Isle on May 5,
2020. She reported the sunroof wasn't working. It turned out
the sunroof wasn't working because rodents had damaged wires in
the passenger-side A-pillar. Valley Isle completed the repair.

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State Farm paid Valley Isle with two checks, but payment was
stopped.

1. Valley Isle proved its claim for the cost of repairing the Lincoln's sunroof.

To prove its claim in the nature of assumpsit, Valley
Isle had to show (a) an agreement; (b) performance by Valley
Isle; (c) breach by La Costa; and (d) damages. Cf. Adelman v.
Steely, No. CAAP-XX-XXXXXXX, 2024 WL 621694, *2 (Haw. App.
Feb. 14, 2024) (SDO).
Valley Isle challenges FOF nos. 4-7 and 13-15:

1. During the specific term of the limited
   warranty, the Lincoln suffered a malfunctioning moonroof[ 2]
   rendering [the moonroof] inoperable.

2. [La Costa] gave timely notice of the
   malfunctioning moonroof.

3. [Valley Isle] repaired the moonroof over a
   period of three months.

4. [Valley Isle] determined that a rodent
   infestation had occurred in the Lincoln.
   . . . .

5. [La Costa] made a claim against her
   comprehensive vehicle insurance policy to cover the cost of
   the repairs.

6. [La Costa]'s insurance carrier delivered to
   [Valley Isle] two checks payable to the order of [Valley
   Isle] in the amount of $7,567.20 which were subsequently
   subject to a stop-payment order.

7. [Valley Isle] made demand on [La Costa] for
   payment of the repairs.

FOF nos. 4-7 and 13-15 are supported by substantial
evidence and were not clearly erroneous.
Valley Isle presented evidence that La Costa asked it
to repair her Lincoln's sunroof. The trial court correctly found

2
The parties use the terms sunroof and moonroof interchangeably.

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that Valley Isle repaired the sunroof. The trial court found
that La Costa refused to pay for the repair. La Costa did not
challenge the reasonableness of Valley Isle's $7,567.20 repair
bill. Valley Isle proved its assumpsit claim.

1. Valley Isle's point about the trial court allowing La Costa's proffered expert witness to testify is moot.

Valley Isle contends the trial court erred by allowing
La Costa to call Bruce Burger, an undisclosed witness, to testify
as an expert. Burger was not identified on La Costa's trial
witness list. La Costa's answering brief presents no argument,
conceding the error. But the trial court's error was harmless,
and Valley Isle's point is moot.
Burger conceded the Lincoln's sunroof was "the most
complicated one that I've looked at. . . . [I]t's got the most
apparatus, the most buttons, and the most functions" (emphasis
added). He believed there was a problem with the Lincoln's
sunroof. He testified:

the moonroof would remain stationary the entire time that I
sat parked in the car, but once I went out driving, it
remained stationary up until the point in time, like -- and,
again, I don't know exactly how long it took to begin
starting its movement, but after about 20 minutes, when I
looked up and observed, it had indeed moved a substantial
amount forward.

Richard Busta, Valley Isle's shop foreman and lead
senior master Ford technician, was asked whether the sunroof can
close on its own while the Lincoln was being driven. Busta
explained:

It is designed to actually close approximately
8 inches at 15 miles an hour, and that's to reduce the wind
noise and buffeting within the vehicle. That's a design of
the system.
. . . .

That is a design. In fact, it's actually even stated
in the owner's manual.

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Burger was successfully impeached. The trial court's
error in allowing an undisclosed witness to testify was harmless
because the court found that Valley Isle "repaired the
moonroof[.]" Valley Isle's point of error is moot.

1. The trial court clearly erred by finding and concluding the sunroof repair was covered under the manufacturer's warranty.

Valley Isle challenges FOF no. 2:

1. Part of the sale of the Lincoln included a written, express limited warranty for a specific term and was a basis of the bargain.

FOF no. 2 is not clearly erroneous. The Lincoln Motor
Company Warranty Guide was in evidence as La Costa's Exhibit B.
Valley Isle challenges FOF no. 3:

1. Relevant portions of the limited warranty were:

"the authorized dealer will, without charge, repair,
replace or adjust all parts on your vehicle that
malfunction or fail during normal use during the
applicable coverage period due to a manufacturing
defect in factory-supplied materials or factory
workmanship." Def. Exh. B at 11

"SYNC Hands-Free Communication and Entertainment
System" Def. Exh. B at 16

"Other Items or Conditions Not Covered" Def. Exh. B
at 17

"Ford and your dealer are not responsible for any time
or income that you lose, any inconvenience you might
be caused, the loss of your transportation or use of
your vehicle, the cost of rental vehicles, fuel,
telephone, travel, meals or lodging, the loss of
personal or commercial property, the loss of revenue,
or for any other incidental or consequential damages
you may have." Def. Exh. B at 7

(Emphasis added.)
FOF no. 3 is incomplete. The Warranty Guide also
describes what the warranty covers in more detail:

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Under your New Vehicle Limited Warranty if:
- your Lincoln vehicle is properly operated and maintained,
and
- was taken to an authorized dealership for a warranted
repair during the warranty period,

then the authorized dealer will, without charge, repair,
replace, or adjust all parts on your vehicle that
malfunction or fail during normal use during the applicable
coverage period due to a manufacturing defect in factory-
supplied materials or factory workmanship.

This warranty does not mean that each Lincoln vehicle is
defect free. Defects may be unintentionally introduced into
vehicles during the design and manufacturing processes and
such defects could result in the need for repairs. Ford
provides the New Vehicle Limited Warranty only to remedy
manufacturing defects that result in vehicle part
malfunction or failure during the warranty period.

The remedy under this written warranty, and any implied
warranty, is limited to repair, replacement, or adjustment
of defective parts. This exclusive remedy shall not be
deemed to have failed its essential purpose so long as Ford,
through its authorized dealers, is willing and able to
repair, replace, or adjust defective parts in the prescribed
manner. Ford's liability, if any, shall in no event exceed
the cost of correcting manufacturing defects as herein
provided and upon expiration of this warranty, any such
liability shall terminate.

(Emphasis added.)
Valley Isle challenges FOF nos. 8 and 9:

1. Based upon the rodent infestation determination,
   [Valley Isle] deemed the malfunctioning moonroof to be
   excluded from the limited warranty coverage.

2. No credible evidence was presented that any
   serious investigation or testing was performed to conclude
   that the rodent infestation was the cause [of] the
   malfunction, just that the existence of a rodent infestation
   excluded the malfunctioning moonroof from coverage of the
   warranty.

(Emphasis added.)
FOF no. 8 is clearly erroneous. La Costa points to no
evidence showing she made a warranty claim with Valley Isle. The
evidence was that Valley Isle billed State Farm, State Farm paid

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Valley Isle, but payment was stopped after La Costa asked State
Farm to stop payment. La Costa points to no evidence showing
Valley Isle denied a warranty claim because rodents infested the
Lincoln.
FOF no. 9 is clearly erroneous. Busta opened
La Costa's May 5, 2020 repair order "for a sunroof being
inoperative." He testified in detail about the testing he
performed.
Valley Isle service technician Craig Farr also
testified in detail about the testing and repair he performed.
He ultimately detected a problem "at the right-hand A-pillar,
which is the pillar that runs up along the side of the windshield
in the front door." He "took the -- the trim panel off and [he]
saw the chewed wires[.]" "[I]t was two or three wires that were
chewed by a rodent that were creating -- or creating the concern
where the window wasn't operating properly." "The wiring in the
A-pillar was repaired. The sunroof initial -- the sunroof and
the sunshade initialized as they were supposed to and was working
as it was designed."
FOF no. 9 refers to "[n]o credible evidence" being
presented. An appellate court will ordinarily not pass upon
issues dependent upon credibility of witnesses. Cowan, 156
Hawai#i at 272, 574 P.3d 292. But here, Busta's and Farr's
testimony was corroborated by Valley Isle's 24-page Repair Order
(Valley Isle Exhibit 1) and six pages of diagnostic communication
between Valley Isle's technicians and Ford (Valley Isle
Exhibit 2). La Costa presented no evidence to show there was
another cause for the sunroof being inoperable. Under these
circumstances, we are "left with the definite and firm conviction
in reviewing the entire evidence that a mistake has been
committed." Cowan, 156 Hawai#i at 272, 574 P.3d at 292.
FOF no. 9 also contained the clearly erroneous finding
that Valley Isle told La Costa "the existence of a rodent

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infestation excluded the malfunctioning moonroof from coverage of
[sic] the warranty." (Emphasis added.) Again, La Costa points
to no evidence showing Valley Isle denied a warranty claim
because rodents infesting the Lincoln was excluded.
The conclusion about the exclusion was a mixed finding
and conclusion because the trial court had to apply the evidence
to the Warranty Guide. "The construction and legal effect to be
given a contract is a question of law[.]" Cowan, 156 Hawai#i at
273 n.3, 574 P.3d at 293 n.3.
The uncontroverted evidence showed the sunroof didn't
work because rodents had chewed the wiring. As a matter of law,
the warranty did not apply to the repair work because rodents
chewing on wiring is not a manufacturing defect, nor does it make
the wires (a part) defective. The warranty exclusions were never
implicated because the warranty didn't apply. Cf. Sturla, Inc.
v. Fireman's Fund Ins. Co., 67 Haw. 203, 210, 684 P.2d 960, 965
(1984) (stating "the basic principle that exclusion clauses
subtract from coverage rather than grant it").
Valley Isle challenges COL nos. 1-9. All pertain to
the warranty issue. Some are actually mixed findings and
conclusions. They were wrong, clearly erroneous, or inapposite,
for the reasons explained above.
The trial court cited Ford Motor Company v. Gunn, 181
S.E.2d 694 (Ga. App. 1971). There, the Georgia court of appeals
did not have to decide whether the defect (abnormal vibration in
steering wheel, seats, and body of Gunn's car) was covered by, or
excluded from, Ford's new vehicle warranty.
The trial court cited the Magnuson-Moss Warranty Act,
15 U.S.C. § 2301 et seq. La Costa's counterclaim did not state a
claim for damages under 15 U.S.C. § 2310 (d).
The trial court cited Rose v. Chrysler Motors
Corporation, 28 Cal. Rptr. 185 (Cal. App. 1963). There, Rose
bought a Plymouth. "From the beginning, it was apparent that its

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wiring system was defective." Id. at 186. Two months later, the
instrument panel burst into flames and the car was severely
damaged. The dealership claimed it only had to repair or replace
the wiring, not any other fire-damaged part of the car. The
California court of appeals ruled that "the responsibility of the
warrantors extends to making all necessary adjustments and
replacing all parts which are required because of defective
workmanship or materials existing in the vehicle considered as a
whole and without regard to whether or not an individual part was
originally defective, per se." Id. at 188. The decision, aside
from not binding us, does not apply here. After Valley Isle
replaced the rodent-chewed wiring, the sunroof worked as
designed.
The trial court cited Cox Motor Car Company v. Castle,
402 S.W.2d 429 (Ky. 1966). There, Castle bought a new truck from
Cox. Within a month, the truck developed "a serious vibration or
shimmy." Id. at 430. Cox told Castle "it was just the nature of
the truck." Id. It contended there was no breach of warranty,
and "the duty was on the buyer to point out what parts were
defective and to ask replacement of those specifically." Id. at
431. The Kentucky court held "that the duty was on the seller,
upon complaint being made of unsatisfactory operation of the
truck, to make an examination designed to disclose the cause."
Id. Here, after La Costa told Valley Isle her Lincoln's sunroof
didn't work, Valley Isle examined it, found the cause, and fixed
it.
The trial court clearly erred by finding and concluding
the sunroof repair was covered under the manufacturer's warranty.

1. The trial court erred by awarding damages for replacing the instrument panel.

This point pertains to La Costa's counterclaim. The
trial court awarded La Costa damages for having to replace the
Lincoln's center instrument panel.

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La Costa's answering brief concedes that her witness,
Rick Grant, "confirmed damages of $23,436.84, less approximately
$5,030 for replacing an instrument panel that should not have
been included in the invoice." But she argues: "Despite [Valley
Isle]'s argument, there is no evidence that the trial court
included the $5,030 amount for the instrument panel in its
award." That is correct; the trial court instead awarded
$3,124.79 for "Center instrument panel." The award consisted of
$1,909.28 plus a forty percent mark-up for parts, and 7.6 hours
of labor at $60.00 per hour. The judgment for La Costa should
have been reduced by $3,124.79.

1. The trial court acted outside its discretion by awarding La Costa attorney fees.

The trial court's decision and order stated:
2. [La Costa] is the prevailing party and
attorneys' fees "not [to] exceed twenty-five per cent" of
the amount awarded [($10,325.05)] shall be taxed to [Valley
Isle]. [Hawaii Revised Statutes §] 607-14[.]

La Costa's attorney submitted a declaration, as ordered
by the trial court, showing the time he spent on the case, his
hourly rate, and the total fees including Hawai#i general excise
tax. The amount exceeded twenty-five percent of the judgment, so
the trial court awarded $2,581.26 under Hawaii Revised Statutes
(HRS) § 607-14.
La Costa's counterclaim alleged "[d]amages to [her]
vehicle while in the care and custody of [Valley Isle], and
failure by [Valley Isle] to properly repair [her] vehicle." The
former sounded in tort, the latter in assumpsit.
We have reduced La Costa's tort recovery by $3,124.79,
but she prevailed on the claim. She is responsible for paying
her attorney's fees under the American Rule, because no fee award
is authorized by statute, stipulation, or agreement. Ranger Ins.
Co. v. Hinshaw, 103 Hawai#i 26, 31, 79 P.3d 119, 124 (2003).

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La Costa did not prevail on her assumpsit claim. The
trial court correctly found that Valley Isle repaired the
sunroof. The trial court's ruling against Valley Isle was based
on its clearly erroneous mixed finding and conclusion that the
sunroof repair was covered under the Warranty Guide.
The trial court acted outside its discretion by
awarding La Costa attorney fees.

CONCLUSION

We vacate the Judgment and remand for further
proceedings.
On remand, the District Court should enter an amended
judgment for (1) $7,567.20 for Valley Isle and against La Costa
on the amended complaint; and (2) $7,200.26 for La Costa and
against Valley Isle on the counterclaim. The District Court
should allow Valley Isle to move for an award of attorney fees
under HRS § 607-14 as the prevailing party on its claim in the
nature of assumpsit.
DATED: Honolulu, Hawai#i, February 27, 2026.

On the briefs:
/s/ Keith K. Hiraoka
Scott W. O'Neill, Presiding Judge
for Plaintiff/Counterclaim
Defendant-Appellant /s/ Clyde J. Wadsworth
Valley Isle Motors, Ltd. Associate Judge

Jack R. Naiditch, /s/ Sonja M.P. McCullen
for Defendant/ Associate Judge
Counterclaimant-Appellee
P. Denise La Costa.

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