County of Haw. v. C & J Coupe Family Ptner.

Decision Date24 December 2008
Docket NumberNo. 28822.,28822.
Citation198 P.3d 615,119 Haw. 352
CourtHawaii Supreme Court
PartiesCOUNTY OF HAWAI`I, a municipal corporation, Plaintiff/Counterclaim Defendant-Appellee v. C & J COUPE FAMILY LIMITED PARTNERSHIP, Defendant/Counterclaimant-Appellant and Robert Nigel Richards, Trustee Under The Marilyn Sue Wilson Trust; Miles Hugh Wilson; John Does 1-100; Jane Does 1-100; Doe Partnerships 1-100; Doe Corporations 1-100; Doe Entities 1-100; And Doe Governmental Units 1-100, Defendants. C & J Coupe Family Limited Partnership, Third-Party Plaintiff-Appellant v. 1250 Oceanside Partners aka Hokuli'a, Third-Party Defendant-Appellee (Civ. No. 00-1-0181K). County of Hawai`i, a municipal corporation, Plaintiff/Counterclaim Defendant-Appellee v. C & J Coupe Family Limited Partnership, Defendant/Counterclaimant/Cross Claimant-Appellant and 1250 Oceanside Partners Aka Hokuli'a, Defendant/Cross Claim Defendant-Appellee and Robert Nigel Richards, Trustee Under The Marilyn Sue Wilson Trust; Miles Hugh Wilson; John Does 1-100; Jane Does 1-100; Doe Partnerships 1-100; Doe Corporations 1-100; Doe Entities 1-100; and Doe Governmental Units 1-100, Defendants (Civ. No. 05-1-015K).

Robert H. Thomas, Honolulu (Kenneth R. Kupchak, Mark M. Murakami, and Christi-Anne H. Kudo Chock with him on the briefs) (Damon Key Leong Kupchak Hastert), for appellant, C & J Coupe Family Limited Partnership.

Joseph K. Kamelamela, Hilo (Michael J. Udovic, Ivan M. Torigoe, and Katherine A. Garson with him on the briefs) Deputies Corporation Counsel, County of Hawai`i, for appellee County of Hawai`i.

William Meheula, Honolulu (Winer, Meheula & Devens), for appellee 1250 Oceanside Partners aka Hokuli`a.

NAKAYAMA, ACOBA, and DUFFY, JJ.; with MOON, C.J., concurring separately and dissenting, with whom LEVINSON, J., joins.

Opinion of the court by ACOBA, J.

This case arises from two condemnation actions brought by Plaintiff-Appellee County of Hawaii (Appellee or the County). In both actions Appellee sought to condemn property belonging to Defendant-Appellant C & J Coupe Family Limited Partnership (Appellant)1 for use as a public highway (Bypass).2 1250 Oceanside Partners (Oceanside), a development company that was to build the Bypass through an agreement with Appellee, was added in Civ. No. 00-1-0181K (Condemnation 1) as a Third-Party Defendant and, therefore, is the Third-Party Defendant-Appellee in the appeal in that case. Oceanside was ordered joined as a defendant on indispensable party grounds in Civ. No. 05-1-015K (Condemnation 2) and, therefore, is the Defendant-Appellee in the appeal from that case. The court consolidated the cases and dismissed Condemnation 1 in favor of Appellant but granted condemnation in Condemnation 2, entering judgment in favor of Appellee and Oceanside on September 27, 2007. Oceanside joined Appellee in its answering brief on appeal and, therefore, is bound by the resolution herein of the issues raised.

Appellant appeals from (1) the automatic denial by operation of law of Appellant's post-judgment motion for statutory damages pursuant to HRS § 101-27 (1993)3 in Condemnation 1 and (2) the September 27, 2007 First Amended Final Judgment of the Circuit Court of the Third Circuit (the court)4 in favor of Appellee in Condemnation 2. Related to the court's judgment dismissing Condemnation 1, Appellant argues that it was entitled to statutory damages under HRS § 101-27 because "[Appellee] did not succeed in taking the property in that case." Related to Condemnation 2, Appellant argues that (1) the court lacked subject matter jurisdiction under the doctrine of abatement, and (2) if the court had subject matter jurisdiction, it erred in failing to consider whether the asserted public purpose was a pretext for private benefit. On appeal, Appellant asks this court to (1) remand Condemnation 1 for an award of damages,5 and (2)(a) reverse the court's Judgment in Condemnation 2 for lack of jurisdiction, or, in the alternative, (b) vacate the Judgment in Condemnation 2 and remand for determination of whether the asserted public purpose was pretextual.

We hold that (1) a landowner in a condemnation action is entitled to damages under HRS § 101-27 where the property at issue is not finally taken in the context of a particular condemnation proceeding, irrespective of whether the government attempts to take the land through subsequent condemnation proceedings; (2) abatement does not apply where the relief sought in two concurrent actions is not the same; and (3) although our courts afford substantial deference to the government's asserted public purpose for a taking in condemnation proceeding, where there is evidence that the asserted purpose is pretextual, courts should consider a landowner's defense of pretext. Therefore, (1) automatic denial of statutory damages under HRS § 101-27 in Condemnation 1 is vacated and the case remanded for a determination of damages; (2) the court's conclusion that Condemnation 2 was not abated by Condemnation 1 is affirmed, and (3) the court's Judgment in Condemnation 2 is vacated and the case remanded for a determination of whether the public purpose asserted in Condemnation 2 was pretextual.

I.

This case arises from the development of the Hokuli'a subdivision (Hokuli'a) by Oceanside. The project is located on a 1550-acre parcel, which extends from the ocean almost to the Mamalahoa Highway, and crosses the border between North and South Kona on the Island of Hawai`i. Appellant's property is contiguous to the southern border of Hokuli'a. It appears that the zoning of the 1550-acre parcel did not allow for the planned Hokuli'a development.6 Thus, the Hawai`i County Council (HCC) passed Ordinances 96-7 and 96-8, which, in pertinent part, rezoned the Hokuli'a land. As a condition of rezoning, Oceanside agreed to construct a Bypass in the vicinity of Keauhou and Captain Cook. According to Appellee, the Bypass is necessary to "alleviat[e] unacceptable and unsafe traffic conditions."

Appellant characterizes the Bypass as a means of accessing the Hokuli'a development from the existing infrastructure, i.e., Mamalahoa Highway. It maintains that Oceanside agreed, as a condition of rezoning, to "construct a road to connect its property to Mamalahoa Highway."7 Further, Appellant represents that, under this condition, Oceanside was responsible for acquiring the property necessary for the Bypass and for the cost of constructing the Bypass. Contrastingly, Appellee states that, because the Bypass would cross many parcels of privately-owned land, "the [rezoning] ordinances anticipated that [Appellee] might need to use its eminent domain power in connection with the construction of the Bypass." Paragraph 14 of the Development Agreement requires Oceanside to dedicate the Bypass to Appellee upon its completion. Thereafter, Appellee will "assume all responsibility and costs for operation, maintenance, repair, or reconstruction of the [Bypass]."

In April of 1998, the HCC passed Resolution 244-98 adopting the Development Agreement between Appellee and Oceanside. Appellant presents the portions of the Development Agreement following as salient. First, Oceanside was authorized to determine the route of the Bypass and, thus, which property needed to be acquired.

Oceanside shall:

....

(2) Determine the final ... alignment of the entire [Bypass], including intersection areas.

(Capitalization omitted.) Relatedly, Paragraph 10 provided for the exercise of Appellee's eminent domain power if Oceanside could not obtain the land necessary for the Bypass through private sale.

Oceanside shall attempt to negotiate a purchase price with any and all persons. Should Oceanside and any person be unable to negotiate a mutually agreeable purchase price, then Oceanside shall provide [a list of appraisers, from which the landowner must choose one appraiser and accept the price established by the appraiser]. Should Oceanside and the person be unable to select an appraiser or if the person and Oceanside cannot decide on a price recommended by [a] mutually selected appraiser, then upon written request to the Mayor, [Appellee] shall be required to use its condemnation powers to acquire the segment(s) from the person pursuant to Paragraph (11).

(Emphases added.) (Capitalization omitted.) The Development Agreement also allowed for the institution of condemnation proceedings in the absence of negotiations, where the landowner refused to consider selling his or her land to Oceanside.

Notwithstanding Paragraph (10.b), if the person fails to participate in negotiations with Oceanside for the purchase of segment(s) of the [Bypass] from the person despite Oceanside's good faith attempts to negotiate, then Oceanside may, in its sole discretion submit a letter to the Mayor to have [Appellee] utilize its condemnation powers. Upon receipt of the written request [Appellee] shall be required to use its condemnation powers to acquire the segment(s) from the person pursuant to Paragraph (11).

(Emphases added.) (Capitalization omitted.) Second, Paragraph 11 of the Development Agreement established that (1) condemnation actions would be initiated upon Appellee's receipt of a notice of requirement from Oceanside, (2) Oceanside had sole discretion to determine what property to condemn, and (3) Oceanside would reimburse Appellee for any costs incurred as a result of the condemnation proceedings.

Should the person fail to participate in negotiations with Oceanside ..., the condemnation powers of [Appellee] shall be required for the acquisition of the segment(s).

a. Upon Oceanside's tender of a requirement of condemnation by letter to [Appellee], [Appellee] shall within thirty (30) days begin to immediately and expeditiously exercise the same pursuant to HRS chapter 101. Oceanside's tender of such requirement of condemnation to [Appellee] shall constitute a "formal initiation of condemnation action" as that term is used in Condition L(2) of Ordinance 96-8 and...

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