Price v. State of Hawaii

Decision Date18 September 1991
Docket Number90-15863,Nos. 90-15117,s. 90-15117
Citation939 F.2d 702
PartiesDr. Nui Loa PRICE, aka Maui Loa, individually and in his capacity as chief of the Hou Hawaiians; The Hou Hawaiians, a Native Hawaiian Ohana; and Kamuela Price, individually, and in his capacity as member of the elder council of the Hou Hawaiians, Plaintiffs-Appellants, v. STATE OF HAWAII, William W. Paty, individually and as Chairman of the Board of Land and Natural Resources of the State of Hawaii; Herbert K. Apaka, Jr.; Moses W. Kealoha; J. Douglas Ing; John Arisumi; Herbert Arata, individually and as Members of the Board of Land and Natural Resources of the State of Hawaii; John Waihee, individually and as Governor of the State of Hawaii; The Honolulu Sailors Home Society, a Hawaii non-profit corporation; HFSL Corp., a Hawaii corporation, dba Harbor Associates; Peter S. Smith, dba Smith Development Corp.; Glenn K. Okada, dba G.K.O. Corp.; and HonFed Bank, a federal savings bank, Defendants-Appellees.
CourtU.S. Court of Appeals — Ninth Circuit

James Weinstein and Randall Udelman, Arizona State University of Law, Tempe, Ariz., for plaintiff-appellant Kamuela Price, and Walter R. Schoettle, Honolulu, Hawaii, for plaintiffs-appellants Nui Loa Price and the Hou Hawaiians.

Steven S. Michaels and Randall Y.K. Young, Deputy Attys. Gen., Honolulu, Hawaii, for defendants-appellees State of Hawaii and Hawaii officials, Keith J. Steiner, Honolulu, Hawaii, for defendant-appellee Honolulu Sailors Home Soc., Philip J. Leas, Cades, Schutte, Fleming & Wright, Honolulu, Hawaii, for defendants-appellees HFSL Corp., Peter S. Smith and Glenn K. Okada, and John P. Moon and Lissa H. Andrews, Honolulu, Hawaii, for defendant-appellee HonFed Bank.

Appeal from the United States District Court for the District of Hawaii.

Before BEEZER, NOONAN and FERNANDEZ, Circuit Judges.

FERNANDEZ, Circuit Judge:

Once again we visit the scene of the ongoing contest which pits Dr. Nui Loa Price, Kamuela Price and the Hou Hawaiians (appellants) against the State of Hawaii (the State) and a number of its officials. 1 This visit we find a pitched battle into which a number of private parties have also been drawn. Those parties are the Honolulu Sailors Home Society (HSHS), HFSL Corporation, dba Harbor Associates, Peter S. Smith, dba Smith Development Corp., Glenn K. Okada, dba G.K.O. Corporation, and HonFed Bank. We will sometimes refer to all of this group as the "private appellees." Appellants claim that a certain parcel of land in which the private appellees purportedly have an interest is, in fact, owned by the State and is subject to the public trust which was created at the time that the State was admitted to the Union. Based upon the facts pled and otherwise before us in this action, we disagree and we affirm the district court's dismissal of the action as to all defendants other than the state officials.

PROCEDURAL POSTURE AND BACKGROUND FACTS

In 1893 the Provisional Government of the Hawaiian Islands granted a parcel of land to HSHS (the lot). The grant provided that the lot "shall be used only for the purposes and uses of a Sailors Home ... equally available to the sailors of all nations...." It went on to provide that if the "described lot or any part thereof shall at any time cease to be used for the purposes of a Sailors Home, the whole of said lot shall forthwith revert to the Government of the Hawaiian Islands."

HSHS took possession of the lot and commenced using it for a sailors home. Unfortunately, as is so often true when perpetual restrictions are imposed upon the uses of land, changes in the uses of surrounding properties made the restriction outdated, onerous and lacking in economic sense. The lot is in the heart of Honolulu's downtown business district.

HSHS, however, did not simply violate the restrictions and abide the consequences. Rather, it commenced legal proceedings in which it asked the courts of Hawaii to approve certain plans in advance. Those plans would, in the opinion of HSHS, make use of the lot in a way that carried out the intent of the grantor, even though the uses may not, at first blush, have appeared to have been within the specific terms of the grant itself. HSHS resorted to the courts on three separate occasions, but only the last resort is the subject of this case.

In 1969, HSHS filed an action in which the State was made a party. The Attorney General of the State appeared and represented its interests. At that time, the Circuit Court of the First Judicial Circuit of the State of Hawaii determined that the lot itself was not going to be the physical location of a sailors home, but that its use in combination with other adjacent property would "constitute an actual physical use of a substantial portion of the premises for sailors." Moreover, said the court, this would be a "fair, just and reasonable" arrangement. See Findings of Fact and Conclusions of Law in In re the Honolulu Sailors' Home Society, CV No. 28078 (July 14, 1969). See also the judgment of even date. In other words, the court placed its imprimatur upon the contemplated transaction.

Appellants were not pleased with the fact that, in effect, no sailors' home was actually to be located on the lot itself. Thus, in 1989, appellants commenced this action for the purpose of having the private appellees ejected from the lot and of having the State commence receiving any income which the lot then produced. The reason that what appears to be a local dispute over property rights is before the federal courts is to be found in section 5(f) of the Hawaii Admissions Act. Pub.L. 86-3, Sec. 5(f), 73 Stat. 4 (1959) (the Act). As pertinent here, section 5(f) reads as follows, and we have emphasized the part most pertinent to our discussion:

The lands ... together with the proceeds from the sale or other disposition of any such lands and the income therefrom, shall be held by said State as a public trust for the support of the public schools and other public educational institutions, for the betterment of the conditions of native Hawaiians ..., for the development of farm and home ownership on as widespread a basis as possible for the making of public improvements, and for the provision of lands for public use. Such lands, proceeds and income shall be managed and disposed of for one or more of the foregoing purposes in such manner as the constitution and laws of said State may provide and their use for any other object shall constitute a breach of trust for which suit may be brought by the United States.

Appellants assert that since the rights of the Provisional Government in the lot passed to the United States and thence to the State upon its admission to the Union, those rights are subject to the provisions of section 5(f) of the Act. That being so, say the appellants, the State through the inaction of its officials has allowed an improper diversion of revenues that should have come into the State's hands and been used for section 5(f) purposes.

This is not the first time that appellants have accused the State and its officials of violating the trust imposed upon the land which was ceded to the State under the terms of the Act. See Price v. Akaka, 928 F.2d 824 (9th Cir.1991) (superseding 915 F.2d 469 (9th Cir.1990)) (Akaka ); Price v. State of Hawaii, 921 F.2d 950 (9th Cir.1990) (Price II ); Price v. State of Hawaii, 764 F.2d 623 (9th Cir.1985), cert. denied, 474 U.S. 1055, 106 S.Ct. 793, 88 L.Ed.2d 771 (1986) (Price I ). In each of those cases, as well as others hereinafter noted, we were required to explore the interface between state and federal law which was created upon the passage of the Act. We must now do so again, although, as will appear, many of the issues before us have already been decided in our prior visitations to this area.

JURISDICTION AND STANDARD OF REVIEW

The district court had jurisdiction pursuant to 28 U.S.C. Sec. 1343 and 42 U.S.C. Sec. 1983. We have jurisdiction pursuant to 28 U.S.C. Sec. 1291.

We review the grant of summary judgment and the grant of a motion to dismiss de novo. Price II, 921 F.2d at 954. Issues of eleventh amendment and qualified immunity are also reviewed de novo. Id. Questions of immunity which arise from facts not in dispute also present issues of law. Id.

We review the district court's award of fees under Rule 11 for an abuse of discretion. Townsend v. Holman Consulting Corp., 929 F.2d 1358, 1365-66 (9th Cir.1991) (en banc) (superseding 914 F.2d 1136, 1143 (9th Cir.1990) (en banc)). Attorneys fees awards under 42 U.S.C. Sec. 1988 are also reviewed for abuse of discretion. Barry v. Fowler, 902 F.2d 770, 773 (9th Cir.1990).

DISCUSSION
A. Standing.

At the outset, we are met by the State's assertion that appellants lack standing. This issue can be quickly disposed of. We have previously made it clear that persons in the position of these appellants do have standing to challenge the use of section 5(f) lands. See Akaka, 928 F.2d at 826-27; Ulaleo v. Paty, 902 F.2d 1395, 1397 (9th Cir.1990); Price I, 764 F.2d at 630. As we have said, although section 5(f) itself does not provide a private right of action, an action under 42 U.S.C. Sec. 1983 is proper. Ulaleo, 902 F.2d at 1397; Keaukaha-Panaewa Community Ass'n v. Hawaiian Homes Comm'n., 739 F.2d 1467, 1470-71 (9th Cir.1984) (Keaukaha II).

B. Immunity; Dismissal of the State and the State Officials.

(1) The State.

Appellants have, once again, attempted to sue the State. As we said in Price II, 921 F.2d at 958: "It is pellucid that they cannot, for the eleventh amendment prohibits it." Thus, the district court properly dismissed the action against the State itself.

(2) State Officers in their Official Capacity.

The complaint seeks retrospective relief against the state officials. It seeks no prospective relief against them. To the extent that it is intended to...

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