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Electronically Filed
Supreme Court
SCAP-XX-XXXXXXX
10-FEB-2026
12:56 PM
Dkt. 69 OP
IN THE SUPREME COURT OF THE STATE OF HAWAIʻI
---o0o---NOVA BURNES, et al.,
Plaintiffs-Appellees,
vs.
HAWAIIAN ELECTRIC COMPANY, INC. dba HAWAIIAN ELECTRIC, et al.,
Defendants-Appellees,
and
ACE AMERICAN INSURANCE COMPANY, et al.,
Intervenor Subrogation Plaintiffs-Appellants.
SCAP-XX-XXXXXXX
APPEAL FROM THE CIRCUIT COURT OF THE SECOND CIRCUIT
(CAAP-XX-XXXXXXX; CASE NO. 2CCV-XX-XXXXXXX)
FEBRUARY 10, 2026
McKENNA, ACTING C.J., EDDINS, AND GINOZA, JJ.,
CIRCUIT JUDGE MORIKONE, IN PLACE OF DEVENS, J., RECUSED,
AND CIRCUIT JUDGE TOMASA, ASSIGNED BY REASON OF VACANCY
OPINION OF THE COURT BY EDDINS, J.
I.
On August 8, 2023, fire devastated Lahaina, the former
capital of the Hawaiian Kingdom. Over one hundred people lost *** FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER ***
their lives. Hundreds suffered physical and emotional injuries.
Properties and historic sites were destroyed. Businesses and
livelihoods impacted by the fires paused as Lahaina worked to
rebuild. The lasting physical and mental health toll, and
social, cultural, and economic impacts of this catastrophe
continue to resonate in Hawaiʻi and beyond.
Following the Lahaina fire and other same-day fires in Kula
and Olinda, individually represented plaintiffs (Individual
Plaintiffs) sued Hawaiian Electric Company, Kamehameha Schools,
the State of Hawaiʻi, the County of Maui, and others
(Defendants). Meanwhile, class actions were filed in state
court, then removed to federal court. Later those lawsuits were
consolidated and refiled in state court as a single class
action. That consolidated class action is now before us.
The class action nears finality in the Circuit Court of the
Second Circuit. Sophisticated court-ordered mediation led to a
“global settlement” in August 2024. This settlement’s initial
terms were reduced to a global settlement term sheet that
resolved all claims against Defendants for an aggregate
settlement amount. On November 1, 2024, Individual Plaintiffs
executed an individual settlement agreement with Defendants.
That same day, the class action plaintiffs (Class Plaintiffs)
signed a class action settlement agreement with Defendants.
These complementary settlement agreements constitute the “global
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settlement.” At that time, the $4.037 billion aggregate
settlement amount was not yet allocated between the class and
individual settlements.
This appeal involves Class Plaintiffs’ insurers’
(Subrogating Insurers) effort to intervene in the class action
settlement proceedings. Subrogating Insurers believe they have
an interest in the proceedings that justifies intervention by
right under Hawaiʻi Rules of Civil Procedure (HRCP) Rule 24(a)(2)
and permissive intervention under HRCP Rule 24(b)(2).
We hold that Subrogating Insurers do not have a protectable
interest that allows them to intervene. Based on applicable
Hawaiʻi statutes, In re Maui Fire Cases held that when insureds
and defendants settle, the insurer’s sole remedy is a lien on
the settlement. In re Maui Fire Cases (Maui Fires), 155 Hawaiʻi
409, 425, 565 P.3d 754, 770 (2025). In the context of a tort
settlement, insurers may not seek to recoup insurance payments
through their own lawsuits against defendants. See id. at 432,
565 P.3d at 777.
Here, Class Plaintiffs have settled with Defendants. This
settlement activated the Hawaiʻi Revised Statutes (HRS) § 663-10
lien framework. It foreclosed potential subrogation suits by
Subrogating Insurers against Defendants related to the Class
Plaintiffs.
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Still, Subrogating Insurers insist they retain equitable
subrogation rights justifying intervention. Some class members
may fail to submit their claim against the class settlement
fund. There, they receive no settlement award. Thus,
Subrogating Insurers complain that there is nothing for them to
attach liens to under HRS § 663-10. Subrogating Insurers are
wrong. A non-claiming class member’s choice does not conjure
equitable subrogation rights.
Adopting Subrogating Insurers’ position would functionally
eliminate mass tort class settlements. It would also erode HRCP
Rule 23’s framework, one that promotes uniformity, judicial and
litigation economy, and procedural remedies for under-resourced
plaintiffs who would otherwise be unable to pursue litigation.
Subrogating Insurers’ effort to narrowly construe a class
settlement inevitability as conferring subrogation rights fails.
For purposes of equitable subrogation, class members’
entitlement to recover from the settlement fund constitutes
recovery from the tortfeasor. When a class settles, insurers
are limited to their exclusive HRS § 663-10 remedy - liens. See
Maui Fires, 155 Hawaiʻi at 432, 565 P.3d at 777. Further,
because subrogation is fundamentally a derivative claim
(insurers may only subrogate when insureds have the right to
sue, and insurers have paid the insured), resolution of a tort
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lawsuit by settlement ends insurers’ subrogation rights. See
id. at 416, 432, 565 P.3d at 761, 777.
The settlement’s dispatch of Subrogating Insurers’
subrogation rights without party status satisfies due process.
We have already held that insurers suffer no prejudice when
policyholders settle and extinguish subrogation rights without
insurer consent. Id. at 437-38, 565 P.3d at 782-83. We did not
hold that HRS § 663-10’s exclusive lien remedy and process
offends due process. See id. Accordingly, a settlement
provision that allows Subrogation Insurers to file claims with
the settlement fund does not bestow class member status and the
connected due process right to opt out.
We further conclude that no protectable interest exists
based on Subrogating Insurers’ claim that the settlement fund is
insufficient. Economic interests alone do not confer
intervention rights.
It’s evident. Subrogating Insurers lack a protectable
interest justifying intervention by right. And absent a
protectable interest, the disposition of this action does not
“as a practical matter, impair or impede [Subrogating Insurers’]
ability to protect [such an] interest.” See Ing v. Acceptance
Ins. Co., 76 Hawaiʻi 266, 271, 874 P.2d 1091, 1096 (1994)
(citation omitted). Without a protectable interest, Subrogating
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Insurers cannot intervene by right. See id.; Baehr v. Miike, 80
Hawaiʻi 341, 345, 910 P.2d 112, 116 (1996).
Even if Subrogating Insurers had a protectable interest,
their motion was untimely. Subrogating Insurers should have
intervened when they knew or should have known that settlement
would adversely impact their interests. When the class action
settlement was publicized on November 4, 2024, Subrogating
Insurers knew the settlement may impact their interests.
Waiting until after our March 2025 Maui Fires opinion (when they
were certain of this court’s holding regarding their subrogation
interests) was misguided. Intervention derails a complex and
delicate settlement, substantially prejudicing the parties.
Thus, the motion to intervene was too late.
We also conclude that the circuit court properly denied
permissive intervention. See HRCP Rule 24(b)(2).
We affirm Second Circuit Court Judge Peter T. Cahill’s
order denying Subrogating Insurers’ motion to intervene.
II.
A. Circuit Court Filings
To start, we revisit the procedural posture preceding our
March 2025 Maui Fires decision and the present appeal.
As we related in Maui Fires, Individual Plaintiffs brought
numerous actions against several defendants in the Circuit Court
of the Second Circuit. 155 Hawaiʻi at 414, 565 P.3d at 759. The
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court initiated a special proceeding per Rules of the Circuit
Courts of the State of Hawaiʻi Rule 12 to “coordinate the
issuance of complex case management orders applicable to all
individual proceedings in the numerous cases arising from the
Maui wildfires.” Id. “[T]he circuit court ordered liaison
counsel to coordinate the Individual Action Plaintiffs[] . . .
then appointed a special settlement master and co-administrators
to facilitate settlement.” Id. at 414-15, 565 P.3d at 759-60.
“Separately three class action lawsuits were filed in the
First and Second Circuits in the name of injured parties that
had not yet filed individual actions (Consolidated Class
Plaintiffs). These three class actions were removed to the
United States District Court for the District of Hawaiʻi, where
they were consolidated into a single action and later re-filed
in the Second Circuit.” Id. at 415, 565 P.3d at 760.
In October 2024, the Consolidated Class Plaintiffs and
Defendants stipulated to dismiss the federal class action
complaints. Id. at 415 n.2, 565 P.3d at 760 n.2. On October
30, 2024, Class Plaintiffs refiled a single complaint in the
Circuit Court of the Second Circuit. Id.
Before then, the Individual Plaintiffs, Class Plaintiffs,
Defendants, and Subrogating Insurers had participated in courtordered mediation to resolve the pending actions. Id. at 415,
565 P.3d at 760. In early August 2024, all parties (minus the
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Subrogating Insurers) signed a settlement term sheet. Id. That
document detailed a global settlement resolving all claims
against Defendants. Id. The settlement required either (1)
written release by all Subrogating Insurers of claims against
Defendants, or (2) “a judgment, order, or opinion determining
that if the Settlement Agreement between the [Individual and
Class Plaintiffs] and the Paying Parties becomes
effective, . . . the Subrogating Insurers’ exclusive remedy for
any Maui Fires Claims would be asserting liens, if any, against
their policyholders for their respective shares of the Aggregate
Settlement Amount[.]” Id. (brackets in original omitted).
As Maui Fires explained, “[o]n August 19, 2024, pursuant to
the proposed global settlement, the circuit court issued an
order declaring itself to have ‘exclusive jurisdiction,
authority, and legal duty to review and resolve any and all
subrogation claims or liens arising out of claims for payments
under HRS § 663-10 in the event the global settlement of the
Maui Fires claims between Plaintiffs and Defendants becomes
effective.’” Id. at 416, 565 P.3d at 761.
On September 12, 2024, the circuit court reserved three
questions to this court. Id. We accepted the reserved
questions on September 25, 2024, ordered briefing, held oral
argument, and on March 17, 2025, published our opinion answering
the reserved questions. See id.
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We held that “the lien-claim process established by HRS
§ 663-10 provides the exclusive remedy for an insurer to recover
for claims paid to an insured for damages caused by a thirdparty tortfeasor where the insured has settled with the
tortfeasor[.]” Id. at 425, 565 P.3d at 770.
Days later, on March 24, 2025, Class Plaintiffs moved for
preliminary class certification, settlement agreement approval,
and appointment of class counsel. The settlement agreement
provides for a class settlement fund totaling $135 million.
B. The Class Settlement
On November 1, 2024, as part of the global settlement and
shortly after Class Plaintiffs re-filed their action in state
court, Class Plaintiffs and Defendants executed a Class
Settlement Agreement. On the same day, the Individual
Plaintiffs executed an Individual Settlement Agreement with
Defendants.
The Class Settlement Agreement conditioned the settlement
on either a written release by “[e]ach and every” Subrogating
Insurer of all claims against Defendants, or a final and
unappealable decision that
if the Class and Individual Settlement Agreements become
effective, (a) the Subrogation [Insurers’] exclusive remedy
for any claims arising out of the Maui Fires would be
asserting liens, if any, against their policyholders for
their respective shares of the Aggregate Settlement Amount,
and (b) the Subrogation [Insurers] shall be barred from
bringing or maintaining any claims arising out of the Maui
Fires against the Defendants.
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To meet this condition, the settlement agreement states
that Judge Cahill’s August 19, 2024 special proceeding order
regarding the operation of HRS § 663-10 “constitutes a decision
of a trial court that, if rendered Final and Unappealable, would
satisfy Section 5.1.2.”
According to the settlement agreement, the “Settlement
Class” is defined as all persons who suffered injuries (physical
or economic), or who had property damage or damages to their
businesses arising from the fires. The Settlement Class also
includes other “eligible” family or personal representatives of
injured or deceased individuals. The “Settlement Class”
excludes defendants and “insurers and insurance syndicates that
claim or could claim damage or harm regarding the Maui Fires
arising out of a right of subrogation or reimbursement[.]”
“Class Plaintiffs” are “all Persons included within the
Settlement Class who do not timely and validly elect to opt-out
of the Settlement Class pursuant to the procedures set forth in
the Class Notice.” Class Plaintiffs are thus class members (or
those who fall under the broad Settlement Class definition) who
remain part of the class after the opt-out deadline.
The settlement agreement also defined “Class Claimant.” A
“Class Claimant,” as defined by the settlement agreement, is
“any Person who files a claim for or receives a Monetary Award
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from the Class Settlement Fund.” Per Section 4.1.2(k) of the
settlement agreement, the class settlement plan (to be crafted
after preliminary approval for the court’s final approval) must
“address the resolution of claims of Subrogat[ing] Insurers for
payments made to policyholders who are Class Plaintiffs but are
not Class Claimants, which shall include a process for such
insurers to submit claims on behalf of their insureds when such
insureds do not submit a claim.” Put differently, when a class
member does not file a claim against the settlement fund,
§ 4.1.2(k) allows insurers to seek reimbursement via the
settlement plan’s claims process.
C. Subrogating Insurers’ Motion to Intervene
On April 8, 2025, Subrogating Insurers moved to intervene.
They argued that they met all four HRCP Rule 24(a) intervention
by right factors. These factors are: “a) whether the
application was timely; b) whether the [applicants] claimed an
interest relating to the property or transaction which was the
subject of the action; c) whether the disposition of the action
would, as a practical matter, impair or impede the [applicants’]
ability to protect that interest; and d) whether the
[applicants’] interest was inadequately represented[.]” Ing, 76
Hawaiʻi at 271, 874 P.2d at 1096 (brackets in original omitted).
First, Subrogating Insurers maintained that their motion
was timely. Before this court’s March 17, 2025 Maui Fires
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opinion, they “did not know and could not know their subrogation
rights with respect to the Class Action litigation and the
proposed settlement agreement.” The parties would suffer no
prejudice, Subrogating Insurers insisted, because intervention
would allow Class Plaintiffs to renegotiate the settlement terms
and avoid footing the cost of the notice process.
Second, Subrogating Insurers argued that they possess a
protectable interest in equitable subrogation rights that would
be impaired by the settlement’s release of their claims against
Defendants. Third, Subrogating Insurers asserted that the
settling parties cannot adequately represent them because those
parties aspire to release their subrogation claims without
compensation.
Class Plaintiffs and Defendants both opposed the motion to
intervene. Class Plaintiffs responded that Subrogating Insurers
lack a protectable interest that could be impaired by this
action because HRS § 663-10’s lien-claim process provides their
exclusive remedy. Defendants agreed that Subrogating Insurers
possess no protectable interest in equitable subrogation. They
also argued the motion to intervene was untimely, and that Class
Plaintiffs adequately represent Subrogating Insurers’ interests.
In their reply, Subrogating Insurers raised for the first
time a non-lien theory of recovery. Subrogating Insurers assert
that the settlement designates them as Class Claimants who may
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recover directly from the settlement when insured class members
do not submit settlement claims. They say this procedural
difference – direct recovery rather than recovery through liens
on class members’ settlement payments - “demonstrates why [Maui
Fires] does not extend to the class action settlement.”
On June 24, 2025, the circuit court denied Subrogating
Insurers’ motion to intervene. The court ruled that Subrogating
Insurers “failed to establish a legally protectable interest
that would be impaired by the disposition of this action.” It
reasoned that the settlement confines Subrogating Insurers to a
lien remedy under HRS § 663-10. Subrogating Insurers lack
subrogation rights, the court found, reciting a line from Maui
Fires: “A right that does not exist cannot be prejudiced.” 155
Hawaiʻi at 438, 565 P.3d at 783.
The circuit court rejected Subrogating Insurers’ claim that
this court, in answering the reserved questions, “was not aware
of how the application of HRS § 663-10 would affect class action
settlements.” The court reasoned that our decision considered
the global settlement, which included the class action
settlement. It also noted that the Class Plaintiffs filed an
amicus brief and participated in the reserved questions’ oral
argument. Further, the circuit court concluded that because HRS
§ 663-10 applies to “any civil action in tort,” and this class
action is “indisputably” a civil action in tort, Maui Fires
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applies equally to class action settlements. Thus, Maui Fires’
holding that limits insurers’ equitable subrogation upon a tort
settlement applies to class actions.
In a footnote, the circuit court noted that “[i]f an
insured does not opt out of the class and declines to submit a
claim, § 4.1.2(k) of the Class Settlement Agreement allows the
insurer to submit a claim on the insured’s behalf.” The court
found that the settlement provision allowing insurers to submit
claims on behalf of non-claiming class members bears “no nexus”
to Subrogating Insurers’ grounds for intervention. Whether
insurers will submit such claims remains uncertain, the court
explained, and will be determined “after the settlement is
approved and the claims process is underway.” In other words,
an insurer’s ability to submit claims for non-claiming insureds
only arises after settlement approval. The court reasoned that
this settlement provision “gratuitously protects the value of
liens for insurers” in this scenario, but “cannot have the
unintended effect of creating an intervention right for nonparty insurers that does not already exist[.]”
The circuit court also rejected Subrogating Insurers’ due
process challenge to releasing their subrogation rights without
party status. The court applied Maui Fires’ holding that
policyholders may settle and extinguish subrogation rights
without insurer consent. This raised no constitutional
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concerns, the court found. Because they never had subrogation
rights to begin with, Subrogating Insurers suffered no
prejudice.
The court concluded that Subrogating Insurers lacked due
process rights. Nonetheless, Subrogating Insurers “received
sufficient process,” it reasoned. They filed proposed
objections to the settlement, and argued during a May 28, 2025
motion to intervene hearing. Later, after there is an
allocation to challenge, the court explained, Subrogating
Insurers “will also be allowed the opportunity to argue[] . . .
that the settlement allocates money between general and special
damages in bad faith, to the degree the Hawaii Supreme Court’s
decision affords them such a right.” But this future
“opportunity” comes after approval and allocation, and thus
“cannot be used to object to the settlement itself.” Thus, the
court found, Subrogating Insurers “received ample process in
this matter.”
The court further found that the action’s disposition does
not impair Subrogating Insurers’ HRS § 663-10 lien rights. The
court referenced Section 4.1.2(k) of the class settlement
agreement. It “expressly preserves the full extent of the
[Subrogating] Insurers’ lien rights under HRS § 663-10.”
Subrogating Insurers claimed that the settlement fund
inadequately satisfied their liens. But the court ruled that
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“[a]n economic stake in the outcome of the litigation” cannot
justify intervention. See Greene v. United States, 996 F.2d
973, 976 (9th Cir. 1993).
Next, the circuit court rejected Subrogating Insurers’
objections to the settlement amount and class settlement
allocation. Maui Fires created a check for “bad faith” on the
allocation between general and special damages. But our
opinion, the court reasoned, did not require that insurers
receive full reimbursement, or allow insurers to object to the
insureds’ settlement amounts. Because the damages allocation
remains unknown until settlement approval and the claims process
begins, the circuit court concluded that intervention before
then “would do nothing to protect the [i]nsurers’ lien rights as
the [s]upreme [c]ourt defined them.”
The court also deemed the motion untimely. Subrogating
Insurers should have intervened when they had “reason to know
that negotiations might produce a settlement . . . to their
detriment.” See California Dep’t of Toxic Substances Control v.
Com. Realty Projects, Inc., 309 F.3d 1113, 1120 (9th Cir. 2002).
The court found “[t]hat occurred in November 2024, when the
class settlement was made public and after the [Subrogating]
Insurers had been involved in the negotiations.” And
intervention would be highly prejudicial, the court found,
because it would “threaten to unwind the complex and delicately
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balanced global settlement agreement.” See Ing, 76 Hawaiʻi at
272, 874 P.2d at 1097 (losing a settlement would be highly
prejudicial).
The circuit court further stated that even if the other
HRCP Rule 24(a)(2) factors were met, it would deny the motion
because Class Plaintiffs adequately represent Subrogating
Insurers’ interests. When the intervention applicant has the
same “ultimate objective” as an existing party, “a presumption
of adequacy of representation arises.” See Arakaki v. Cayetano,
324 F.3d 1078, 1086 (9th Cir. 2003). Here, the court noted,
Subrogating Insurers share Class Plaintiffs’ goal to maximize
recovery from Defendants.
Last, the circuit court denied permissive intervention
under HRCP Rule 24(b)(2). Because Subrogating Insurers have no
protectable interest in the lawsuit, allowing Subrogating
Insurers to intervene would not “assist in the just and
equitable adjudication of any issues between the parties.” See
Baehr, 80 Hawaiʻi at 345, 910 P.2d at 116.
Subrogating Insurers appealed to the Intermediate Court of
Appeals. On October 1, 2025, Class Plaintiffs applied for
transfer. We granted the transfer application on October 22,
2025. Briefing concluded on January 14, 2026. We held oral
argument on January 27, 2026.
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III.
A. Subrogating Insurers are not entitled to intervention by
right
We hold that because Subrogating Insurers lack a
protectable interest in this class action, they are not entitled
to intervention by right under HRCP Rule 24(a)(2). By
extension, without a protectable interest, no impairment arises
from disposition of this action. These conclusions alone
preclude intervention. But there’s more. The motion to
intervene is untimely.
We agree with Subrogating Insurers in one respect. Class
Plaintiffs inadequately represent their interests. Subrogating
Insurers need to run the table, though. “Failure to meet even
one [factor] prevents intervention ‘by right’ under HRCP Rule
24(a)(2).” Baehr, 80 Hawaiʻi at 345, 910 P.2d at 116. The
absence of a protectable interest and untimeliness preclude
intervention.
We begin with the second HRCP Rule 24(a)(2) factor – a
protectable interest in the subject of the action.
1. Subrogating Insurers do not have a protectable
interest
a. Maui Fires applies to class actions
Maui Fires held that once an insured settles with a
tortfeasor, a subrogating insurer’s “exclusive remedy” is a lien
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on the settlement recovery under HRS § 663-10. 155 Hawaiʻi at
425, 565 P.3d at 770.
A judgment or settlement in “any civil action in tort”
activates HRS § 663-10’s lien process. Subrogating Insurers say
that Maui Fires does not apply to class actions. But a class
action premised on a tort claim is a civil action in tort. So
when class action parties settle, subrogating insurers are
restricted to statutory liens on plaintiffs’ recovery. See id.
We did not limit Maui Fires to individual settlements. The
statutory term “settlement” encompasses class settlements, not
just individual ones.
Class settlements receive the same treatment as individual
settlements under HRS § 663-10. “Any civil action” is a plain,
all-inclusive legislative pronouncement that covers every civil
suit. HRS § 663-10 (emphasis added). “Any” tort suit includes
individual and class actions. The statute contains no
restriction to individually negotiated agreements; it envisions
“‘a comprehensive structure for addressing liens and subrogation
rights’ whenever an insured party pursues a judgment or
settlement from a third-party tortfeasor.” Maui Fires, 155
Hawaiʻi at 426, 565 P.3d at 771 (emphasis added) (quoting
Yukumoto v. Tawarahara, 140 Hawaiʻi 285, 294-95, 400 P.3d 486,
495-96 (2017)). “[T]he plain language of the statute[] . . .
evinces a broad application[.]” Id.
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HRS § 663-10’s reference to “the judgment or settlement”
does not limit the lien process to individual settlements. Nor
does HRS § 663-10 exclude HRCP Rule 23’s class action framework
and settlement procedure.
Rule 23 itself does not require class members to engage in
settlement negotiations and affirmatively consent to settlement.
See HRCP Rule 23(a). Rather, the rule permits class
representatives to pursue claims on behalf of passive class
members, promoting judicial and litigation efficiency, and
decreasing economic burdens on class members. See id.; Life of
the Land v. Land Use Comm’n of State of Haw., 63 Haw. 166, 179,
623 P.2d 431, 442 (1981) (“[HRCP Rule 23’s] pragmatic objectives
include economies of time, effort, and expense, as well as
uniformity of decision for persons similarly situated.”).
HRS § 663-10’s lien procedures apply to all settlements and
must be read harmoniously with HRCP Rule 23. Both frameworks
advance aligned objectives: avoiding duplicative litigation,
enhancing efficiency, and promoting orderly distribution. See
Life of the Land, 63 Haw. at 179, 623 P.2d at 442; Maui Fires,
155 Hawaiʻi at 429, 565 P.3d at 774 (quoting H. Stand. Comm. Rep.
No. 4-86, in 1986 House Journal, at 42-43).
Read alongside HRCP Rule 23, neither HRS § 663-10’s text
nor legislative intent suggests that it applies only to
individual settlements. To hold otherwise allows insurers to
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“interfere with the ability of the injured Plaintiffs and the
Defendants to settle their dispute” in the class context, a
disfavored outcome we rejected in Maui Fires. 155 Hawaiʻi at
435, 565 P.3d at 780 (“[A]llowing the Subrogating Insurers to
pursue reimbursement through direct subrogation actions against
the Defendants, rather than the HRS § 663-10 lien-claim process,
would interfere with the ability of the injured Plaintiffs and
the Defendants to settle their dispute.”).
When it comes to HRS § 663-10, formalistic distinctions
between individual and class settlements make no sense. Our
holding promotes uniformity in serving HRS § 663-10’s design.
Maui Fires’ central holding applies to class actions.
b. Equitable subrogation is unavailable when class
members settle but do not file settlement claims
We turn next to Subrogating Insurers’ argument that they
have a protectable interest in subrogation because some class
members may not submit settlement claims. We hold that class
members’ decision to forego filing claims does not create a
protectable interest in subrogation.
Settlement displaces subrogation. “Where the insured
recovers by settlement or judgment against the tortfeasor, HRS
§§ 431:13-103(a)(10)(A) and 663-10 apply and equitable
subrogation has no place.” Maui Fires, 155 Hawaiʻi at 433, 565
P.3d at 778. Maui Fires preserved insurers’ subrogation rights
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only where there is no recovery from the tortfeasor. Id. It
does not follow that Subrogating Insurers are entitled to
equitable subrogation when class members fail to file claims
against the settlement. See id. at 425, 565 P.3d at 770 (“HRS
§ 663-10 does not apply in the absence of a settlement or
judgment.”).
Subrogating Insurers’ intervention interest, as they define
it, relies on a narrow subset of class members who choose not to
file claims against the settlement. Because some class members
will inevitably decline to participate in the claims process,
treating non-claimants as having never “settled” would grant
insurers equitable subrogation rights - and with them,
intervention-worthy interests - in every mass tort class action.
This would scuttle class action settlements unless defendants
obtain releases of insurers’ claims. Permitting a subrogationbased intervention “workaround” discourages comprehensive
settlement. Defendants’ settlement goal is always to obtain
releases of all potential claims, especially in the class action
context. See Kris J. Kostolansky & Diane R. Hazel, Class Action
Settlements: Res Judicata, Release, and the Identical Factual
Predicate Doctrine, 55 Idaho L. Rev. 263, 266 (2019).
The economics are straightforward. Defendants settle to
limit their liability. Subrogating insurers seek to maximize
reimbursement. Allowing subrogation for non-claiming class
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members in a tort suit undermines the very releases that make
class settlements possible. Intervention for a limited subclass
of non-claiming class members would frustrate Rule 23’s core
purposes: efficiency and access to justice through collective
recovery. See Life of the Land, 63 Haw. at 179, 623 P.2d at
442; Gregory M. Wirt, Missed Opportunity: Stephenson v. Dow
Chemical Co. and the Finality of Class Action Settlements, 109
Penn St. L. Rev. 1297, 1298-99 (2005). Our class action
framework does not allow this approach.
For equitable subrogation purposes, class members’
entitlement to recover from the settlement fund constitutes
recovery from the tortfeasor. Upon class settlement, insurers
are limited to an exclusive statutory remedy. Liens. See HRS
§ 663-10; Maui Fires, 155 Hawaiʻi at 432, 565 P.3d at 777.
Subrogating Insurers’ position that “uninterested” (nonparticipating) class members do not actually “pursue” recovery
misreads basic class action procedural principles. HRCP Rule 23
allows representative class members to protect the class’
interests without requiring active class member participation in
settlement or judgment. HRCP Rule 23(a). Class members are
bound by the final judgment. Unless they opt out, they’re in.
HRCP Rule 23(c)(2) (“the judgment, whether favorable or not,
will include all members who do not request exclusion”); HRCP
Rule 23(e) (“A class action shall not be dismissed or
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compromised without the approval of the court, and notice of the
proposed dismissal or compromise shall be given to all members
of the class in such manner as the court directs.”).
To hold otherwise undercuts finality principles in class
actions. An “absent” class member who does not opt out pursues
the civil action resolving their claims. See HRCP Rule
23(c)(2); Maui Fires, 155 Hawaiʻi at 433, 565 P.3d at 778; Akau
v. Olohana Corp., 65 Haw. 383, 388, 652 P.2d 1130, 1134 (1982)
(“A judgment in a class action consisting of the people actually
injured will bind the members who are all those allowed to
sue.”). Thus, insurers are limited to the statutory lien
process. See Maui Fires, 155 Hawaiʻi at 433, 565 P.3d at 778.
We pause to discuss core principles supporting equitable
subrogation. An insurer’s rights are derivative. Subrogation
rights derive from and are coextensive with an insured’s claims.
See State Farm Fire & Cas. Co. v. Pac. Rent-All, Inc., 90 Hawaiʻi
315, 329, 978 P.2d 753, 767 (1999). Insurers have no greater
rights than their insureds. See id. “[S]ubrogation involves
‘stepping into’ the shoes of another, when an insurer brings an
action against a tortfeasor based upon its subrogation rights,
the insurer’s rights flow from the insured’s rights.” Id.
(quoting 4 R. Long, The Law of Liability Insurance § 23.03, at
23–13 to 23-14 (1998)).
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Where the insureds’ claims are resolved via settlement, so
too are the insurers’ derivative actions. Insurers cannot
subrogate when their insureds have settled. See id.
Class members are bound by the settlement, despite whether
they file their own claims to recover from the settlement fund.
It follows that even if those non-claiming class members do not
recover direct payments from the settlement fund, the
subrogating insurers are still limited to reimbursement from the
settlement. See id. Insurers cannot subrogate settled claims.
See id.
Maui Fires recognized that equitable subrogation prevents a
tortfeasor’s unjust enrichment. 155 Hawaiʻi at 433, 565 P.3d at
778. Class settlements eliminate this concern. Defendants agree
to compensate claimants without a liability finding. Even when
class members do not submit settlement claims, defendants remain
committed to pay a certain amount. That payout remains constant
even when class members don’t file claims. At the same time,
there is no plaintiff windfall concern because plaintiffs who
forego filing claims will not recover twice. See id. at 416,
565 P.3d at 761 (“Subrogation prevents a double recovery by
limiting the insured from collecting damages for the same injury
from both the insurer and the tortfeasor.”).
Next, we address Subrogating Insurers’ position that absent
“competition” with their insureds, they may subrogate.
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Subrogating Insurers misread Maui Fires. They say HRS § 663-10
only kicks in “when there is some form of practical competition
between an insurer and their insured for settlement funds.”
Not so. HRS § 663-10 does not hinge on competition between
insurer and insured for settlement funds. Maui Fires held that
absent settlement or judgment, no competition exists between
insured and insurer for tortfeasor funds. 155 Hawaiʻi at 433,
565 P.3d at 778. Thus the insurer’s third-party claim poses no
risk to the insured’s recovery. Id. In those circumstances (no
settlement or judgment), equitable subrogation prevents
tortfeasor unjust enrichment. Id. (citing State Farm, 90 Hawaiʻi
at 331, 978 P.2d at 769).
Subrogating Insurers maintain that “competition” between
the insurer and the insured must exist before their equitable
subrogation rights may be precluded. Subrogating Insurers
insist that where the insured plaintiff “stands ‘to recover
nothing on [their] own, there [is] no risk of [their] recovery
being diminished.’” See id. at 435, 565 P.3d at 780. Thus,
they say, HRS § 663-10 does not apply absent competition.
Again, Subrogating Insurers misread Maui Fires. This
court’s discussion of plaintiffs’ non-recovery did not create a
“competition” precondition. Subrogating Insurers selectively
cite our opinion’s analysis of Park v. City & Cnty. of Honolulu,
a workers’ compensation case they previously relied on in Maui
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Fires. There we explained that citing Park was “misplaced”
because employee Park’s claim had been dismissed. Id. at 435,
565 P.3d at 780 (citing Park v. City & Cnty. of Honolulu, 154
Hawaiʻi 1, 3, 543 P.3d 433, 435 (2024)). “Because the plaintiff
stood to recover nothing on her own, there was no risk of her
recovery being diminished by the insurer’s subrogation action,”
this court reasoned. Id. The passage Subrogating Insurers
invoke merely distinguishes Park. It does not graft a general
competition requirement. See id.
As we flagged, Park involved “no recovery by judgment or
settlement of a third-party claim against which the insurer
would have been able to assert a lien under HRS § 663-10.” Id.
We contrasted Park with the Maui Fires case, “where the
Plaintiffs have reached the terms of a settlement agreement with
the Defendants, and where allowing the Subrogating Insurers to
pursue their own, separate subrogation actions risks diminishing
or destroying entirely the Plaintiffs’ recovery under the
proposed settlement.” Id.
The “competition” concept in Maui Fires protects insureds
from prejudice when insurers pursue equitable subrogation. See
id. at 425, 565 P.3d at 770. But competition generally does not
limit when HRS § 663-10 applies. Equitable subrogation applies
only when no settlement or judgment exists, and thus there’s no
competition between the insured and the insurer for the same
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funds from the same defendants. Id. Therefore, equitable
subrogation is only available when (1) a judgment or settlement
has not been reached, and (2) the insurer can recover only
through a separate action. See id.
Here, the insureds and the defendant-tortfeasors have
settled. Defendants committed to compensate class members
through the settlement agreement and fund. A “judgment or
settlement against which the insurer may assert a lien” now
exists. See id. at 433, 565 P.3d at 778. So the “competition”
Subrogating Insurers invoke neither exists nor is required.
Class action settlement eliminates a primary justification
for equitable subrogation: preventing a tortfeasor’s unjust
enrichment. See id. Settlement avoids potential unjust
enrichment regardless whether insurers are fully compensated.
Here, unused class settlement funds will be “redistributed
to Class Claimants in an amount proportional to their pro rata
share of the recovery.” No funds revert to Defendants.
Therefore, individual class member claim filings do not affect
competition for settlement funds. The settlement amount paid by
Defendants remains fixed, no matter the degree of class member
participation.
The legislature balanced the interests of the insured and
the insurer. In Maui Fires, we explained that to create “a
fair, uniform and comprehensive procedure governing the rights
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and obligations of insurance companies and consumers for the
reimbursement of insurance benefits from third-party sources of
recovery,” the legislature “‘limit[ed] reimbursement and
subrogation for all insurance companies’ to the comprehensive
procedure prescribed by HRS §§ 431:13-103(a)(10) and 663-10.”
155 Hawaiʻi at 431, 565 P.3d at 776 (quoting H. Stand. Comm. Rep.
No. 1330-00, in 2000 H. Journal, at 1515; Yukumoto, 140 Hawaiʻi
at 296, 400 P.3d at 497). The statutory framework prevents
insurers from blocking tort settlements because their lien
interests are affected. See id. Yet, Subrogating Insurers
aspire to relitigate HRS § 663-10’s operation.
Subrogating Insurers believe the settlement’s process
(allowing them to file claims on behalf of insureds) conflicts
with HRS § 663-10 because liens attach only after class members
receive awards. The statute requires no such thing. See HRS
§ 663-10.
Subrogating Insurers complain that when class members do
not file claims and obtain awards, no recovery exists for lien
attachment. They say that the settlement plan does not actually
“include provisions that address the resolution of claims of
Subrogation Insurers for payments made to policyholders who are
Class Plaintiffs but are not Class Claimants” and does
not “include a process for such insurers to submit claims on
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behalf of their insureds when such insureds do not submit a
claim.”
The putative absence of an insurers’ claims procedure in
the settlement plan does not affect our intervention analysis.
Subrogating Insurers have not alleged an actual violation of
their lien rights or an inability to assert claims on behalf of
their insureds (to the contrary they have asserted settlement
claims for their insureds). They merely insist that subrogation
should be available when class members do not submit claims with
the settlement fund.
In any event, intervention in the class settlement
proceedings is not a condition to later challenge lien
reimbursement rights under HRS § 663-10. To repeat, settlement
precludes subrogation. So the settlement provision does not
confer subrogation rights, and the settlement plan’s purported
procedural gap does not affect our subrogation analysis.
In Maui Fires we preserved insurers’ subrogation rights
when there is no recovery from the tortfeasor. 155 Hawaiʻi at
425, 565 P.3d at 770 (“HRS § 663-10 does not apply in the
absence of a settlement or judgment.”). But that ruling does
not entitle insurers to equitable subrogation when class members
fail to file claims against the settlement. See id.
We rebuff Subrogating Insurers’ formalistic stance that
Section 4.1.2(k)’s insurer claims process does not constitute
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assertion of a lien under HRS § 663-10. Subrogating Insurers
contend that when insurers file claims on behalf of class
members, no “judgment or settlement” exists for lien attachment.
The argument about Section 4.1.2(k)’s procedure does not alter
its substance. This settlement agreement provision achieves the
same result as a traditional HRS § 663-10 lien. Subrogating
Insurers recover from their insureds’ settlement proceeds, just
as under statutory liens. The HRS § 663-10 lien process ensures
that insurers recover the appropriate portion (or all) of their
insured’s special damages obtained through settlement. See HRS
§ 663-10. When insurers recover special damages through the
claims process, HRS § 663-10’s objectives are met. In class
actions, an insured’s absence from the settlement claims process
does not manufacture subrogation rights.
c. Release of equitable subrogation rights without
party status does not violate due process
Subrogating Insurers say their designation as “Class
Claimants” in the settlement agreement violates due process.
The “Class Claimant” designation, the insurers contend,
“unlawfully deprive[s] [them] of the due process rights afforded
to full class members.” Due process, they believe, requires
giving class members the opportunity to opt out of the class to
“prosecute their own claims.” Class Plaintiffs and Defendants
counter. Even though insurers may file claims on behalf of
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class members, they are not Class Claimants, a subclass of class
members who actually file claims against the settlement.
Class members have the right to opt out and be excluded
from the class (and thus, settlement). HRCP Rule 23(c)(2);
Patrickson v. Dole Food Co., Inc., 137 Hawaiʻi 217, 229, 368 P.3d
959, 971 (2015); Silber v. Mabon, 18 F.3d 1449, 1454 (9th Cir.
1994) (quoting Phillips Petroleum Co. v. Shutts, 472 U.S. 797,
812 (1985)) (“[D]ue process requires at a minimum that an absent
[class] plaintiff be provided with an opportunity to remove
[themself] from the class by executing and returning an ‘opt
out’ or ‘request for exclusion’ form to the court.”).
Though they themselves have no such rights, Subrogating
Insurers try to invoke class members’ due process rights. But
class members’ procedural opt-out protections do not extend to
insurers. Class members’ due process opt-out rights are
inaccessible to Subrogating Insurers.
As an initial matter, Subrogating Insurers object that the
settlement binds them, as though they were class members. The
settlement between the Class Plaintiffs and Defendants, though,
neither adjudicates insurers’ rights nor imposes obligations on
them. Rather, the settlement itself forecloses equitable
subrogation by activating HRS § 663-10’s lien-claims process -the insurers’ exclusive remedy. See Maui Fires, 155 Hawaiʻi at
425, 565 P.3d at 770. The “opt out” right Subrogating Insurers
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covet as their primary procedural protection, therefore, is
unavailable.
First, we have already held that insurers suffer no
prejudice when policyholders settle and douse subrogation rights
without insurer consent. Id. at 437-38, 565 P.3d at 782-83. We
did not hold that limiting insurers to the statutory lien
process violates due process. Nor did Subrogating Insurers
argue this at the time. See id. Second, insurers submitting
claims with the settlement fund on behalf of non-claiming class
members does not confer class member status or the right to opt
out. See Alden v. Kona Palisades, Inc., 3 Haw. App. 47, 49, 641
P.2d 330, 332 (App. 1982) (“[J]udicially-approved settlement is
binding upon the members of the class who have not opted out.”);
4 William B. Rubenstein, Newberg and Rubenstein on Class Actions
§ 13:22 (6th ed.) (“Courts regularly find that nonclass members
have no standing to object to a proposed settlement.”).
Subrogating Insurers’ due process argument rests on class
member rights. Yet the settlement expressly excludes
Subrogating Insurers from the Settlement Class. The
settlement’s claims process for insurers does not change this.
We return to the well-worn metaphor of subrogation: the
insurer steps into the insured’s shoes and acquires no
independent rights. See Maui Fires, 155 Hawaiʻi at 418, 565 P.3d
at 763 (citing State Farm, 90 Hawaiʻi at 329, 978 P.2d at 767).
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To grant subrogating insurers their own separate opt-out rights
as extra class members, cobbles shoes that do not fit the
insured. Instead of stepping into their insureds’ shoes,
Subrogating Insurers try to shoehorn themselves into the
settlement as independent parties. This effort collides with
the core rationale for equitable subrogation. Thus, Subrogating
Insurers lack a due process right to opt out under HRCP Rule
23(b).
d. Economic interest in the settlement amount is not
a protectable interest
We next address Subrogating Insurers’ claim that the class
settlement is underfunded.
Economic interest alone does not establish intervention
rights. “An economic stake in the outcome of the litigation,
even if significant, is not enough” to establish a protectable
interest. Greene, 996 F.2d at 976. Greenlighting intervention
based on supposed settlement fund shortfalls would give insurers
veto power over tort settlements. The settlement fund’s
purported inadequacy does not create a protectable interest.
Subrogating Insurers also challenge the settlement. They
quote Maui Fires: “settling parties may not, in bad faith,
structure their settlement in such a way as to nullify the
protections afforded to insurers[.]” See Maui Fires, 155 Hawaiʻi
at 439, 565 P.3d at 784. Subrogating Insurers, though, skip the
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part that limited insurer protections to those “under HRS § 663-10.” Id.
Maui Fires addressed settlement structure in the context of
“protections afforded to insurers under HRS § 663-10.” Id. We
gave examples of settlement structures that nullify HRS § 663-10’s protections: “settlement . . . that purports to waive a
property and casualty insurer’s right to assert an otherwise
valid lien,” and “a settlement improperly structured as for
general damages only, when the circumstances do not warrant such
a settlement.” Id. These scenarios constitute settlement in
bad faith. See id.
The good faith requirement prevents collusive settlements.
See id. But it does not confer insurers equitable subrogation
rights. See id. HRS § 663-10 protects insurers’ settlement
entitlement and special damages reimbursement – nothing more.
Id. at 438, 565 P.3d at 783.
Our opinion did not require full insurer reimbursement
through settlement liens. See id. at 439, 565 P.3d at 784.
Rather, as the circuit court observed, we “created a ‘bad faith’
check by providing the right to object that the allocation of
damages between general damages and special damages was not made
in good faith.” Id. This good faith check is not a blank check
for insurers to challenge the settlement amount here, through
intervention.
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Subrogating Insurers do not allege improper conduct. They
do not assert under-allocation of special damages to evade HRS
§ 663-10. Defendants state that “[t]here currently is no
allocation between general and special damages for the insurers
to challenge.” As for the circuit court, it reasoned that
damage allocation will occur only after the court “approves the
settlement and the claims process proceeds.” Maui Fires
expressly preserved challenges to the settlement allocation for
insurers. Id. This bad-faith review does not support
intervention in the settlement itself. See id.
Thus the alleged settlement fund inadequacy fails to
establish a protectable interest justifying intervention.
2. Subrogating Insurers’ non-existent interest is not
impeded or impaired
HRCP Rule 24(a)(2) directs courts to examine if “the
disposition of the action would, as a practical matter, impair
or impede the intervenor’s ability to protect that interest.”
Ing, 76 Hawaiʻi at 271, 874 P.2d at 1096 (cleaned up) (citation
omitted). Impairment flows from a protectable interest. Absent
a protectable interest, exclusion from the litigation does not
constitute impairment. Am. Nat. Bank & Tr. Co. of Chicago v.
City of Chicago, 865 F.2d 144, 147 (7th Cir. 1989) (“Because the
[applicant] has failed to assert a direct, legally protectable
interest, it follows that it has failed to assert an interest
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that could be impaired or impeded by the district court
proceedings.”).
Settlement approval impairs nothing. Absent a protectable
interest in equitable subrogation, a class action settlement
that covers all claims against all defendants causes no
impairment. “A right that does not exist cannot be prejudiced.”
Maui Fires, 155 Hawaiʻi at 438, 565 P.3d at 783. Similarly, a
nonexistent protectable interest cannot be impaired. See id.
Because Subrogating Insurers lack a protectable interest,
disposition of this action causes no impairment. See Ing, 76
Hawaiʻi at 271, 874 P.2d at 1096.
3. Subrogating Insurers’ motion to intervene was untimely
The motion to intervene was untimely. See HRCP Rule
24(a)(2).
Timeliness is “a matter left to the sound discretion of the
trial court.” Ing, 76 Hawaiʻi at 271, 874 P.2d at 1096.
Timeliness depends on the totality of the circumstances. Id.
Two factors matter most. “[E]specially relevant is: (1) the
lapse of time between when [the applicant] should have sought
intervention and when it actually did; and (2) the prejudice
caused to the [existing parties] by the lapse of time.” Id.
Subrogating Insurers insist intervention was timely because
their subrogation rights remained up in the air until Maui
Fires. We disagree.
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Subrogating Insurers should have intervened when the class
settlement became public on November 4, 2024. At that point,
they knew or should have known the settlement would adversely
affect their interests. See Ing, 76 Hawaiʻi at 271, 874 P.2d at
1096; Com. Realty Projects, Inc., 309 F.3d at 1120. The class
settlement agreement conditioned settlement approval on a court
order barring insurers’ subrogation claims against Defendants.
That settlement agreement’s express terms belie Subrogating
Insurers’ argument. Further, knowledge of the settlement amount
(not available in November 2024) is immaterial to their
purported equitable subrogation rights.
The motion to intervene was untimely despite being filed
before preliminary approval. Treating any delay before
preliminary approval as timely would dilute the timeliness
requirement in class action settlements. Intervention
contemporaneous with the settlement’s agreement would have
averted a five-month delay. Given the complexity and scope of
this settlement and the many plaintiffs and defendants, this
delay prejudices the parties - irrespective of whether
preliminary approval preceded the motion to intervene.
Subrogating Insurers cannot wait until they are dissatisfied
with the litigation’s progress. See Ballard v. Garrett, 78
S.W.3d 73, 76 (Ark. 2002). They offer no passable justification
for their delay.
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The putatively stayed proceedings pending Maui Fires also
does not justify tabling intervention from November 2024 to
April 2025. (Subrogating Insurers argue that they couldn’t have
intervened during the stay, while Class Plaintiffs and
Defendants say a stay was not in place at the time.)
Subrogating Insurers concede they waited for our March 2025
decision on the reserved questions before moving to intervene.
Strategic choice, not the stay, caused the delay.
Next, we consider prejudice, the main component of
timeliness. See Hoopai v. Civil Service Comm’n, 106 Hawaiʻi 205,
216, 103 P.3d 365, 376 (2004). Prejudice outweighs mere delay.
“The most important consideration in deciding whether a motion
for intervention is untimely is whether the delay in moving for
intervention will prejudice the existing parties to the case.”
7C Mary Kay Kane & Allan Stein, Fed. Prac. & Proc. Civ. § 1916
(3d ed. Sep. 2025 update).
Intervention that “‘interject[s] numerous other issues into
the litigation’ . . . [leading] to ‘considerable delay’ in the
disposition of the case” prejudices the parties. Hoopai, 106
Hawaiʻi at 216, 103 P.3d at 376 (quoting Blackfield Hawaii Corp.
v. Travelodge Int’l, Inc., 3 Haw. App. 61, 63, 641 P.2d 981, 983
(App. 1982)). So too with intervention that slows relief. See
Alaniz v. Tillie Lewis Foods, 572 F.2d 657, 659 (9th Cir. 1978)
(because the consent decree was “already being fulfilled,”
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revocation of the decree “would create havoc and postpone the
needed relief,” thus prejudicing the parties); Orange Cnty. v.
Air Cal., 799 F.2d 535, 538 (9th Cir. 1986) (allowing
intervention after the City of Irvine learned the outcome “would
not be entirely to its liking,” and “undoing . . . five years of
protracted litigation” would prejudice the parties).
Maui Fires held that “Plaintiffs have reached the terms of
a settlement agreement with the Defendants, and . . . allowing
the Subrogating Insurers to pursue their own, separate
subrogation actions risks diminishing or destroying entirely the
Plaintiffs’ recovery under the proposed settlement.” 155 Hawaiʻi
at 435, 565 P.3d at 780. Intervention five months after
settlement would imperil the settlement and delay relief,
prejudicing the parties.
Given the urgent need for relief in the wake of the Maui
wildfires, unraveling the global settlement would deny
plaintiffs’ relief when they need it most. See id. Granting
intervention would unwind two years of court-ordered mediation
and settlement negotiations, substantially prejudicing the
parties. See id. Intervention at this stage would derail a
“complex and delicately balanced” settlement. See United States
v. State of Oregon, 913 F.2d 576, 588 (9th Cir. 1990) (“[In]
intervening at this stage to challenge the [Idaho salmon harvest
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allocation] plan would seriously prejudice all the parties to
the suit because the plan is complex and delicately balanced.”).
Prompt settlement is vital. Delay harms victims and erodes
overall settlement value for injured plaintiffs, especially
those with underinsured or uninsurable injuries. The settlement
agreement itself touts “the benefits of a settlement at this
time to Class Plaintiffs.” (Emphasis added.)
Undue delay prejudicially extends plaintiffs’ suffering and
diminishes relief. Plaintiffs may face increased pressure to
settle for less if the current settlement upends. And rising
class litigation costs will reduce class recovery. See John E.
Lopatka & D. Brooks Smith, Class Action Professional Objectors:
What to Do About Them?, 39 Fla. St. U. L. Rev. 865, 865-66
(2012) (delayed “implementation of a class settlement” creates
“[t]he prospect of financial loss”). Meanwhile, Defendants
likely settled to avoid higher-cost individual settlements,
potential liability findings, and prolonged litigation. See
Lopatka & Smith, supra, at 866 n.3 (“the interests of defendants
in expedition [of litigation termination via settlement] are
different from those of class counsel”).
The multi-faceted, carefully calibrated global settlement
resolves claims for thousands of individual and class
plaintiffs, allocates defendant contributions, and distributes
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billions in settlement funds through individual and class
agreements for a wide range of damages.
After unimaginable loss, Lahaina and its people approach
finality through the global settlement. Settlement will allow
this community to pivot from litigation to restoration.
The class settlement, alongside the individual settlement,
balances multiple interests and provides mutually-beneficial
resolution. Collapse due to Subrogating Insurers’ intervention
would severely prejudice the parties.
The court properly denied the untimely motion to intervene.
4. Class Plaintiffs do not adequately represent
Subrogating Insurers’ interests
We turn to the last intervention requirement. Because
Subrogating Insurers lack a protectable interest that would be
impaired by disposition of this action, and the motion was
untimely, the motion to intervene by right fails. See Baehr, 80
Hawaiʻi at 345, 910 P.2d at 116 (failure to meet even one HRCP
Rule 24(a)(2) factor prevents intervention by right).
Nonetheless, because the circuit court cites the adequate
representation factor as a separate basis for denial, we
clarify. Class Plaintiffs do not adequately represent
Subrogating Insurers’ interests.
An applicant intervenor only needs to show that the party’s
representation of their interests “may have been inadequate.”
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Hoopai, 106 Hawaiʻi at 217, 103 P.3d at 377 (citing Sagebrush
Rebellion, Inc. v. Watt, 713 F.2d 525, 528 (9th Cir. 1983)).
Class Plaintiffs do not represent Subrogating Insurers’ interest
in equitable subrogation for non-claiming class members.
Throughout this litigation, Class Plaintiffs have consistently
opposed subrogation.
Class Plaintiffs quarrel with Subrogating Insurers as to
the “interest” they represent on behalf of the insurers. Class
Plaintiffs say that they share an interest in “maximizing
recovery” with Subrogating Insurers. But they oversimplify the
two parties’ positions and interests.
Subrogating Insurers’ interest in this action is not just
boosting reimbursement. They want to subrogate when class
members do not file settlement claims. While subrogation
enlarges insurer recovery, it conflicts with Class Plaintiffs’
core interests: timely settlement, maximum payment from
Defendants, and release of all subrogation claims as a
settlement condition. See id. at 217, 103 P.3d at 377.
Class Plaintiffs inadequately represented Subrogating
Insurers’ interests. See id.
Still, failure to meet all HRCP Rule 24(a)(2) factors
prevents intervention by right.
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B. The circuit court properly denied permissive intervention
HRCP Rule 24(b)(2) permits intervention when (1) the
application is timely, and (2) “an applicant’s claim or defense
and the main action have a question of law or fact in common.”
HRCP Rule 24(b)(2). When ruling on a motion to intervene, the
court must assess whether intervention would “unduly delay or
prejudice the adjudication of the rights of the original
parties.” Id.
We review denial of permissive intervention for abuse of
discretion, not whether the Rule 24(b)(2) factors are present.
Baehr, 80 Hawaiʻi at 345, 910 P.2d at 116 (“[W]hen we are asked
to review a denial of permissive intervention, our task is not
to determine whether the factors of Rule 24(b)(2) are present,
but it is rather to determine whether the trial court committed
an abuse of discretion in denying the motion.”).
The circuit court correctly exercised discretion in denying
permissive intervention. Untimeliness supports that ruling.
See HRCP Rule 24(b)(2).
Because Subrogating Insurers have no protectable interest
in the settlement terms, we also agree with the circuit court
that intervention does not “assist in the just and equitable
adjudication of any issues between the parties.” See Baehr, 80
Hawaiʻi at 345, 910 P.2d at 116.
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Here, Subrogating Insurers claim an equitable subrogation
right derivative of their insureds’ claims. This interest,
though, does not aid in resolving the lawsuit’s central issues:
Defendants’ liability and whether the settlement is fair,
reasonable, and adequate under HRCP Rule 23. See id.
Without a protectable interest, Subrogating Insurers cannot
establish a “common question of law or fact.” Id. (absent “an
interest relating to the property or transaction which is the
subject of the action” no common questions exist).
Subrogating Insurers assert that their claims share the
“same transactional nucleus of facts.” They distort the
24(b)(2) standard. The “transactional nucleus” test comes from
Wong v. Cayetano’s claim preclusion doctrine, not HRCP Rule
24(b)(2). 111 Hawaiʻi 462, 478, 143 P.3d 1, 17 (2006). We
decline Subrogating Insurers’ invitation to transplant a claim
preclusion standard into the permissive intervention analysis.
The permissive intervention standard requires commonality
between the applicant’s “alleged interest and the main action,”
not a common nucleus of facts. Baehr, 80 Hawaiʻi at 345, 910
P.2d at 116; see HRCP Rule 24(b)(2) (requiring that “an
applicant’s claim or defense and the main action have a question
of law or fact in common”).
Equitable subrogation presents no common questions of law
or fact with these tort claims and the class settlement of those
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claims. Because Subrogating Insurers lack a protectable
interest (an “interest relating to the property or transaction
which is the subject of the action”) they cannot demonstrate
common questions with the main action. See Baehr, 80 Hawaiʻi at
345, 910 P.2d at 116; Maui Fires, 155 Hawaiʻi at 425, 565 P.3d at
770.
IV.
We affirm the Circuit Court of the Second Circuit’s June
24, 2025 order denying Subrogating Insurers’ motion to
intervene.
Adam M. Romney /s/ Sabrina S. McKenna (Vincent G. Raboteau, Michael F.
O’Connor, Richard A. Ing, Mark /s/ Todd W. Eddins S. Anderson, Normand R. Lezy,
Christine Forsline, David R. /s/ Lisa M. Ginoza Denton, on the briefs)
for appellants /s/ Kevin T. Morikone
Terrance M. Revere /s/ Taryn R. Tomasa (Patrick Kyle Smith, Graham B.
LippSmith, MaryBeth LippSmith,
Celene Chan Andrews, Jaclyn L.
Anderson on the briefs)
for appellees
Nova Burnes, et al.
Ginger D. Anders
(Joachim P. Cox, Randall C.
Whattoff, Nicholas D. Fram on
the briefs)
for appellees
Hawaiian Electric Company, Inc.
dba Hawaiian Electric, et al.
46