§480-12 Contracts void. Any
contract or agreement in violation of this chapter is void and is not
enforceable at law or in equity. [L 1961, c 190, §10; Supp, §205A-10; HRS
§480-12]
Case Notes
Construing the evidence in plaintiff decedent's trustee's
favor, there was sufficient evidence (decedent mortgagee's impairments, e.g.,
advanced age, inability to see or hear, and dementia, rendered decedent
"incapable of reading, writing and understanding re-finance mortgage
documents") that the mortgage between decedent and defendants was void
under this section, such that plaintiff may continue to seek rescission under
chapter 480. 848 F. Supp. 2d 1182 (2012).
Although a damage claim under §480-13 based on
violations of §480-2 may only be asserted against the wrongdoer, a rescission
claim under chapter 480 can stand against subsequent assignees if the contract
is void; where plaintiff had alleged that defendant mortgage broker assigned or
sold loans to other defendants, plaintiff could seek rescission against other
defendants if mortgage broker violated chapter 480 and the loans were void;
however, a plaintiff seeking affirmatively to void a mortgage transaction under
this section must "place the parties in as close a position as they held
prior to the transaction". 861 F. Supp. 2d 1153 (2012).
A partially illegal contract may be upheld by severing the
illegal portion. 61 H. 607, 607 P.2d 1304.
Where plaintiff did not provide to homeowners the lien
disclosure notices before or upon signing of the contract or prior to the
commencement of the work as required by §444-25.5(a), plaintiff's conduct was
an unfair or deceptive practice that rendered its contract void and
unenforceable at law or in equity under this section; thus, plaintiff was not
entitled to a lien upon homeowners' property under §507-42, and trial court did
not err in dismissing its lien application. 111 H. 349, 141 P.3d 996.
As this section voided the contract between homeowner and
contractor, §507-42 and this section precluded the imposition of a §507-42 lien
upon the homeowner's property by contractor who failed to comply with the
requirements of §444-25.5. 96 H. 365 (App.), 31 P.3d 222.
Section 444-25.5(d) and this section do not preclude some
recovery in quantum meruit from a homeowner by a contractor who fails to comply
with the requirements of §444-25.5; the amount cannot exceed the amount that
would have been due the general contractor under the contract had the contract
not been void, less the amount previously paid the contractor and the total of
the amount paid and owed to all sub-contractors and materialmen. 96 H. 365
(App.), 31 P.3d 222.
Where plaintiff was attempting to eject defendants from a
property that plaintiff purchased at a public auction that was held because of
defendants' failure to pay the amount due and owing on a promissory note and
mortgage on the property, the circuit court erred in finding that because the
plaintiff did not originate the loan, the defendants could not raise an unfair
or deceptive acts or practices defense against the plaintiff. 137 H. 53
(App.), 365 P.3d 389 (2016).
Notes of Decisions
Courbat v. Dahana Ranch, Inc., 141 P.3d 427 (Haw. 2006).
· cites it 18× “As a deceptive trade practice, the Courbats maintain, the waiver is void under HRS § 480-12, see supra note 1. 1. The elements of a deceptive trade practice claim for rescission of a contract To render the waiver void, the Courbats must establish that it is an unseverable part…”
Ai v. Frank Huff Agency, Ltd., 607 P.2d 1304 (Haw. 1980).
· cites it 13× “HRS § 443-47, 5 the commission by a collection agency of a practice prohibited by Chapter 443 is to be characterized as an unfair or deceptive act or practice for the purpose of HRS § 480-2; it accordingly decreed that the promissory note was null, void and unenforceable at law…”
Citicorp Mortg., Inc. v. Bartolome, 16 P.3d 827 (Haw. App. 2000).
· cites it 15× “ue process; (5) there was a complete absence of any admissible evidence supporting the granting of summary judgment; (6) Appellants were fraudulently induced into refinancing their residence with North American; (7) the default judgment against Robin Bartolomé was the product of…”
Hiraga v. Baldonado, 31 P.3d 222 (Haw. App. 2001).
· cites it 23× “d as follows: (a) the amount that would have been due such general contractor under the contract had the contract not been void, (b) less (i) the amount previously paid to the general contractor and (ii) the total of the amounts paid and owed to all of the sub-contractors and…”
Flores v. Rawlings Co., LLC, 177 P.3d 341 (Haw. 2008).
· cites it 10× “The circuit court granted the plaintiffs’ motion for summary judgment on this count, declared the promissory note null, void, and unenforceable under HRS § 480-12, 26 and awarded damages to the plaintiffs in the amount of $1,000 plus costs as provided by HRS § 480-13(a)(l).”
Au v. Repub. State Mortg. Co., 948 F. Supp. 2d 1086 (D. Haw. 2013).
· cites it 9× “ll be void and unenforceable;” (2) Count Five asserted violations of the Truth in Lending Act (“TILA”) against Republic, Cotton, and Sand Canyon — and, under certain circumstances, TILA allows a claim for rescission (although the court had determined that Plaintiffs TILA-based…”
Young v. Bank of New York Mellon, 848 F. Supp. 2d 1182 (D. Haw. 2012).
· cites it 17× “Rescission under HRS § 480-12 Unlike a Chapter 480 damages claim, a rescission claim under Chapter 480 can stand against subsequent assignees if the contract is void (if, for example, the consumer lacked capacity to enter into the contract).”
Assocs. Fin. Servs. Co. of Hawaii, Inc. v. Richardson, 56 P.3d 748 (Haw. App. 2002).
· cites it 8× “ntends the circuit court erred when it: (a) granted summary judgment and a decree of foreclosure because there was no admissible evidence in Associates' motion papers properly brought before the circuit court establishing any loan default, contradicting Richardson's affirmative…”
808 Dev., LLC v. Murakami, 141 P.3d 996 (Haw. 2006).
· cites it 4× “5(d) fall under (1) HRS § 480-2(a) (1993), which declares “unfair or deceptive acts or practices in the conduct of any trade or commerce” unlawful and (2) HRS § 480-12 (1993), under which any contracts involving such unlawful practices are “void and .”
Hawaii Cmty. Fed. Credit Union v. Keka, 11 P.3d 1 (Haw. 2000).
· cites it 2× “HRS § 480-12 provides that ”[a]ny contract or agreement in violation of this chapter is void and is not enforceable at law or in equity.”
Newcomb v. Cambridge Home Loans, Inc., 861 F. Supp. 2d 1153 (D. Haw. 2012).
· cites it 4× “2001) (holding that even *1169 though plaintiff-general contractor could not enforce a contract that was void pursuant to HRS § 480-12, he could still recover in quantum meruit for work performed according to the contract).”
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