Gold Coast Neighborhood Ass'n v. State, SCWC-14-0000472.

• Court: Supreme Court of Hawai'i
• Writing for the Court: OPINION OF THE COURT BY POLLACK, J.
• Citation: 403 P.3d 214
• Parties: GOLD COAST NEIGHBORHOOD ASSOCIATION, v. STATE of Hawai'i State of Hawai'i By Its Attorney General v. Tropic Seas, Inc.; The Association of Apartment Owners of Diamond Head Beach, Inc. ; Olivia Chen Lum, Trustee of the Olivia Chen Lum Revocable Living Trust; Clarence Kwon Hou Lum, Trustee of the Clarence Kwon Hou Lum Trust and Trustee Under the Will and Estate of Chow Sin Kum Lum; Jeanne S.J. Chan and Howard N.H. Chan, Trustees of the Jeanne S.J. Chan Trust; Diamond Head Ambassador Hotel, Ltd.; Diamond Head Apartments, Ltd. ; C S Apartments, Ltd.; The Association of Apartment Owners of 2987 Kalakaua Condominium; Tahitienne, Incorporated ; The Association of Apartment Owners of 3003 Kalakaua, Inc.; The Association of Apartment Owners of 3019 Kalakaua, Inc.
• Decision Date: 25 August 2017
• Docket Number: SCWC-14-0000472.

403 P.3d 214

GOLD COAST NEIGHBORHOOD ASSOCIATION,
v.
STATE of Hawai'i

State of Hawai'i By Its Attorney General
v.
Tropic Seas, Inc.; The Association of Apartment Owners of Diamond Head Beach, Inc. ; Olivia Chen Lum, Trustee of the Olivia Chen Lum Revocable Living Trust; Clarence Kwon Hou Lum, Trustee of the Clarence Kwon Hou Lum Trust and Trustee Under the Will and Estate of Chow Sin Kum Lum; Jeanne S.J. Chan and Howard N.H. Chan, Trustees of the Jeanne S.J. Chan Trust; Diamond Head Ambassador Hotel, Ltd.; Diamond Head Apartments, Ltd. ; C S Apartments, Ltd.; The Association of Apartment Owners of 2987 Kalakaua Condominium; Tahitienne, Incorporated ; The Association of Apartment Owners of 3003 Kalakaua, Inc.; The Association of Apartment Owners of 3019 Kalakaua, Inc.

SCWC-14-0000472.

Supreme Court of Hawai'i.

AUGUST 25, 2017

Douglas S. Chin and William J. Wynhoff, Honolulu, for petitioner.

Robert G. Klein, Jordon J. Kimura, Randall K. Schmitt, and Troy J.H. Andrade, Honolulu, for respondent.

McKENNA AND POLLACK, JJ., AND CIRCUIT COURT JUDGE CASTAGNETTI, IN PLACE OF WILSON, J., RECUSED, WITH NAKAYAMA, J., DISSENTING, WITH WHOM RECKTENWALD, C.J., JOINS

OPINION OF THE COURT BY POLLACK, J.

I. INTRODUCTION

For at least the past 65 years, residents and visitors of O'ahu have been free to walk along the cement path atop a seawall (the Seawall) on or near the seaward boundaries of property between 2943 Kalakaua Avenue and 3019 Kalakaua Avenue to access the beach, shoreline, and ocean in order to swim, surf, fish, and enjoy other activities of island living. Over the course of these many decades, the State has paid for and completed repairs and maintenance on the Seawall, enabling the public to continue to safely use the footpath. As recently as 2006, the Hawai'i State Legislature appropriated funds to repair the Seawall. However, the State shortly thereafter disclaimed any duty to maintain the Seawall, prompting commencement of this lawsuit to require the State to maintain and keep the Seawall in good and safe condition.

The Circuit Court of the First Circuit (circuit court) ruled that based on the applicable law and the uncontested evidence in this case, the State had obtained an easement for public use over and across the Seawall by virtue of common law implied dedication. The

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Intermediate Court of Appeals (ICA) unanimously agreed. We conclude that in light of (1) Hawaii's long-standing principles of common law, (2) the historical significance and deep roots of implied dedication in this jurisdiction as evidenced by nearly 150 years of this court's precedent, and (3) the undisputed evidence in this case, the circuit court and the ICA correctly determined that the State obtained an easement over and across the Seawall by common law implied dedication.

In addition to determining that the State owned an easement over and across the Seawall by implied dedication, the circuit court also ruled that the State owned the real property under the Seawall by virtue of surrender under Hawaii Revised Statutes § 264-1(c)(2) (2007). Given this court's precedent, however, ownership of the Seawall was not transferred to the State by virtue of surrender. Thus, the circuit court and the ICA erred in concluding that the State owns the Seawall and the real property under the Seawall.

Given our disposition with respect to the merits of Gold Coast's claims in this case, we also determine whether the circuit court properly denied Gold Coast's motion for attorneys' fees and costs against the State. Although the ICA determined that an award of both fees and costs was permissible in this case, we conclude that this ruling and the circuit court's ruling were both partially erroneous because the State waived its sovereign immunity with respect to costs but not attorneys' fees.

II. BACKGROUND

A. Construction, Public Use, and State Repairs to the Seawall

At issue in this case is a length of seawall that stretches from the seaward boundaries of property between 2943 Kalakaua Avenue and 3019 Kalakaua Avenue (the Seawall). The Seawall runs along Waikiki's "Gold Coast," an area of condominiums and cooperative apartments located on ocean front lots near the Diamond Head end of Kalakaua Avenue.¹ The Seawall was originally constructed by private parties over eighty years ago. Since approximately 1930, the Seawall has been used by both residents and members of the general public, without interference or restriction, to access the ocean and to traverse along the Waikiki coastline.

For decades, the State has maintained the Seawall, conducted necessary repairs to the Seawall, and otherwise assumed responsibility to preserve and manage the Seawall. In at least 1982, 1984, and 1993, the State conducted various repairs to the Seawall, and local and state appropriations were made by the relevant legislative bodies in contemplation of further repairs in at least 1989, 1992, and 2006. By stipulation of the parties in this case, the repairs were described as follows:

• In June 1982, the State of Hawai'i Department of Land and Natural Resources (DLNR), Land Division, performed "emergency repair work" to "shore approximately 40 feet of the Seawall along the boundary of Diamond Head Apartments." By 1981 Haw. Sess. Laws Act 1, Item K-2, the State legislature authorized the expenditure of $25,000.00 for these repairs.

• Sometime in 1982, the DLNR, Land Division, performed repairs and "rehabilitated broken sections of the Seawall" from the Elks Club property to near the Diamond Head end of Kalakaua Avenue. The funding for the repairs was appropriated by 1981 Haw. Sess. Laws Act 1, Item K-2, and by 1981 Haw. Sess. Laws Act 264, Item K-2.

• "Sometime after May 1984," the State performed additional repair work on "one or more portions of the Seawalls pursuant to work identified as Job No. 1-0L-31, Waikiki Seawall Walkway Rehabilitation, Phase III." The original

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scope of this project consisted of "rehabilitating seawalls, constructing hand railing and other incidental and appurtenant work necessary to complete this project."²

• On December 8, 1992, following Hurricane Iniki, the Honolulu City Council passed a resolution authorizing the DLNR "to rehabilitate the existing Seawall walkway located in Diamond Head, Oahu and identified by TMK Nos. 3-1-032:001, 002, 003, 004, 026, 027, 028 and 029, and 3-1-033:002, 003 , 004, 005, 006, 007, 008, 009, 010, 011, 053, and 056." The repair and rehabilitative work conducted pursuant to this project was limited to portions of the Seawall in front of the Diamond Head Ambassador Hotel. The construction was authorized by the Hawai'i legislature by 1989 Haw. Sess. Laws Act 316, Item K-11. Repairs were completed in September 1993 at a contract price of $609,605.00. Pursuant to this project, "the State built or rebuilt essentially the entire wall in front of ... three properties" along the Seawall, although "to the extent the State built the wall makai of the then shoreline the wall [was] on State property."

• In an October 13, 1993 letter from the DLNR, the Manager-Chief Engineer of the DLNR stated that further repair work on the Seawall was scheduled for TMK Nos. 3-1-32:029, 004, 003, 002, 001, 3-1-033:011 and 009.

• In 2006, the Hawai'i legislature appropriated $2 million for "plans, design and construction for the resurfacing of the seawall and installation of railings along Waikiki's Gold Coast." The appropriation was included within H.B. 1900 in a section titled "Waikiki Seawall Improvements, Oahu."

(Emphases added.)

Since at least 1975, various assertions made by the State have further manifested its long-held position that the Seawall serves as a public right-of-way and that the State has the duty and responsibility to maintain the Seawall for use by the public. The parties stipulated that the following relevant documents would be entered into evidence in this case:

• A February 27, 1975 memorandum authored by Wallace W. Weatherwax, Deputy Attorney General (DAG Weatherwax), to the Department of Transportation's Harbors Division intended to resolve the Harbors Division's inquiry as to "whether or not the State has the responsibility to maintain and improve a public right of way which passes over a seawall located within" TMK No. 3-1-33-2 and TMK No. 3-1-33-53. In the memorandum, DAG Weatherwax stated the fact of "the use by the public of this right of way since 1930" and concluded that "the State has the responsibility to maintain the public right of way over the seawall."

• A 1982 Environmental Assessment issued by the DLNR regarding the repair of a portion of the Seawall near the Diamond Head Apartments, in which the DLNR stated that "[t]he top of the seawall serves as a public walkway for residents and beachgoers to traverse along the shores of Waikiki Beach" and that "[r]esidents, surfers, beachgoers and fishermen use the top of the seawall to traverse between the Diamond Head end of Waikiki Beach and Sans Souci Beach."

• A document dated May 1984 relating to the "Waikiki Seawall Walkway Rehabilitation" project stating that "the State has a right-of-way over the seawall and has obtained a right-of-entry onto" certain properties "for the rehabilitation of the seawall walkway."

403 P.3d 220

• A "Notice of Determination (Negative Declaration)" relating to the "Waikiki Seawall Walkway Rehabilitation Project" issued by the DLNR, Water and Land Development Division, with a handwritten notation at the top identifying the document as "1992-10-23-OA-FEA-Waikiki Seawall Walkway," describing proposed repairs to the Seawall in the amount of $550,000.00 and stating that "the State of Hawai'i has a right-of-way over all the seawalls and walkways and is responsible to keep them in good and safe condition" and that "the walkways are used by the general public."

(Emphases added.) Thus, for many decades, the Seawall has been enjoyed by members of the general public and repaired, maintained, and overseen by the State.

Gold Coast Neighborhood...