The Hawaii Supreme Courtroom held that the Workplace of the Auditor for the state doesn’t have the authority to pierce the veil of attorney-client privilege and acquire the confidential communications of the Workplace of Hawaiian Affairs.
According to the opinion, the 2 constitutionally-created state companies discovered themselves at odds over two legal guidelines—a bit of the Hawaii Revised Statutes and a regulation regarding attorney-client privilege. The Workplace of the Auditor believes that HRS Part 23-5 entitles it to obtain all data of an auditee, together with attorney-client communications, protected by Hawaii Guidelines of Proof (HRE) Rule 503. However the Workplace of Hawaiian Affairs, the topic of the audit, sued, arguing that attorney-client privilege overcomes the authority of the auditor and preserves the confidentiality of these communications.
Justice Todd W. Eddins, in his written opinion, said that the state’s excessive court docket disagreed that the auditor had the authority to acquire the confidential communications and rejected the competition that the Workplace of the Auditor’s jurisdiction and non-justiciability bars the go well with.
Chief Justice Mark E. Recktenwald and Affiliate Justices Paula A. Nakayama, Sabrina S. McKenna, and Michael D. Wilson joined Eddins.
The Hawaii Legislature handed Act 37, or the Workplace of Hawaiian Affairs Appropriations Act of 2019, which conditioned the discharge of common funds from OHA upon receipt of an audit report, in response to the opinion. Defendants Leslie H. Kondo, and the State of Hawaii Workplace of the Auditor, started the audit of the Workplace of Hawaiian Affairs and the Board of Trustees of the Workplace of Hawaiian Affairs.
In accordance with the opinion, the auditor requested for data together with unredacted govt session minutes from the OHA. Since these minutes contained privileged attorney-client communications, the OHA urged that they supply the auditor redacted minutes, in response to the opinion,
“This dissatisfied the Auditor,” stated Eddins. “The Workplace of the Auditor has limitless energy to entry all OHA data, he advised OHA.”
The 2 companies continued to disagree, leading to a stalemate, in response to Eddins.
“Then the Auditor packed up his audit, explaining in a late December 2020 letter to OHA that he couldn’t end the audit with out OHA’s attorney-client communications,” said Eddins.
Earlier than suspending the audit, Kondo advised the OHA that he had “‘the power to if essential to subpoena data, or subpoena folks’” however that “‘I don’t consider we ever want to drag that set off for a State Company. I consider a State Company should cooperate,’” the opinion stated.
Eddins known as the auditor’s determination to not subpoena the data “odd” because the legislature has given him the ability to take action.
Because of the unfinished audit, the OHA didn’t obtain its common funds. However the legislature finally amended Act 37 to permit the funds the be launched. Within the time between the audit suspension and the discharge of the funds, the OHA sued Kondo and the Workplace of the Auditor. In a two-count grievance filed in February 2020, the OHA hunted for declaratory reduction within the Circuit Courtroom of the First Circuit.
The primary depend, which was dismissed by the circuit court docket, sought a declaratory judgment that the auditor violated Act 37 by failing to submit an audit. The second sought declaratory judgment “that neither HRS Chapter 23 nor the Hawaii State Structure requires OHA to speak in confidence to the State Auditor privileged attorney-client communications protected against disclosure,” the opinion stated.
“The circuit court docket sided with OHA, granting its movement for abstract judgment and denying the auditor’s movement for judgment on the pleadings,” said Eddins.
“The Auditor contends that HRS § 23-5 and HRE Rule 503 don’t battle,” said Eddins. “And since there isn’t a battle, the Auditor’s superior powers snap the attorney-client privilege.”
Eddins rejected these arguments and held that until an audit’s topic waives attorney-client privilege, or a court docket orders disclosure, the Workplace of the Auditor could not entry the privileged communications. The opinion went on to state that the 2 legal guidelines on this case don’t battle.
“The Auditor’s powers and the attorney-client privilege can coexist,” stated Eddins. “The legal guidelines usually are not explicitly opposite or inconsistent. And courts, just like the circuit court docket right here, can learn HRE Rule 503 and HRS § 23-5 in concord, giving impact to each statutes. The legal guidelines don’t have to incompatibly collide.”
Eddins said that OHA argued that if it caves to the auditor absent a court docket order, then attorney-client privilege can be waived. However the auditor insisted that OHA doe not waive privilege by giving him the requested data.
“If Kondo guarantees OHA he gained’t inform anyone, his argument appears to run, then OHA hasn’t waived the privilege and will hand over its attorney-client communications,” stated Eddins.
The justice once more disagreed with the auditor, stating that simply because the auditor, “shall not be required to reveal” data doesn’t imply he won’t accomplish that. Eddins stated that there isn’t a assurance in HRS Part 23-5 that any “involuntary” disclosure will stand up to problem and stay confidential.
“With no safety, OHA’s counsel made the fitting name—the one one per a lawyer’s skilled and moral obligations,” stated Eddins.
The state excessive court docket affirmed the order by First Circuit Choose Jeffrey Crabtree granting OHA’s movement for abstract judgment and denying the auditor’s movement for judgment on the pleadings.
Neither counsel for Kondo and the Workplace of the Auditor, Douglas S. Chin of Starn, O’Toole, Marcus & Fisher, nor counsel to the OHA, Kurt W. Klein of the Klein Legislation Group, instantly responded to a message in search of remark.
