Background
This case arose from a foreclosure action brought by U.S. Bank National Association, acting as trustee for a Citigroup mortgage loan trust backed by asset-backed pass-through certificates issued in 2007, against homeowner Phyllis Kehaulani Duncan Chun. The case was filed in the Circuit Court of the First Circuit of Hawai’i (Case No. 1CC141002192), indicating the underlying foreclosure proceedings began around 2014. Arrow Financial Services, LLC was also named as a defendant in the action.
Chun contested the foreclosure, asserting counterclaims against U.S. Bank. The Circuit Court ruled in favor of U.S. Bank, and Chun appealed to the Intermediate Court of Appeals (ICA), which docketed the matter as CAAP-23-0000573. After the ICA ruled against her, Chun sought further review by filing an Application for Writ of Certiorari with the Hawai’i Supreme Court on May 15, 2026.
The Supreme Court panel consisted of Chief Justice Devens, Justices McKenna and Ginoza, Circuit Judge Hamman sitting in place of Justice Eddins who was recused, and Circuit Judge Tomasa assigned by reason of vacancy on the court.
The Court’s Holding
The Hawai’i Supreme Court rejected Chun’s Application for Writ of Certiorari on July 6, 2026. The one-page order, signed by all five justices, provides no written analysis or reasoning, which is typical for certiorari denials — the court exercises its discretion to decline review without explaining its rationale.
The rejection leaves the Intermediate Court of Appeals’ decision in favor of U.S. Bank as the final appellate ruling in the case. Chun has exhausted her appellate remedies in the Hawai’i state court system.
Key Takeaways
- The Hawai’i Supreme Court declined to review the ICA’s decision, leaving the foreclosure judgment in favor of U.S. Bank National Association undisturbed.
- A certiorari rejection in Hawai’i carries no precedential weight and does not constitute a ruling on the merits of the underlying legal questions raised by Chun.
- The case illustrates the multi-year duration of contested foreclosure litigation in Hawai’i, with trial court proceedings dating to approximately 2014 concluding at the appellate level in 2026.
Why It Matters
While this certiorari rejection is not a merits ruling and establishes no new law, it signals the end of prolonged foreclosure litigation stemming from the 2007 mortgage securitization era. Cases involving Citigroup’s 2007 asset-backed securities trusts have been litigated in courts across the country for over a decade, often raising questions about standing, chain of title, and the authority of trustees to foreclose.
For practitioners handling foreclosure defense in Hawai’i, the outcome underscores that once the ICA has ruled against a borrower, securing Supreme Court review remains a high bar. Attorneys should ensure that all dispositive arguments are fully developed at the circuit court and ICA levels rather than preserved for certiorari, which the Supreme Court has broad discretion to deny without explanation.