Pelosi v. Wailea Ranch Estates

Opinion by

ACOBA, J.,

concurring in part and dissenting in part.

I concur in the majority’s conclusion that “[PlaintiffrCounterclaim Defendant-Appellant Angelo] Pelosi [ (Pelosi) ] was entitled to a mandatory injunction, ordering [Defendant-Appellee Wailea Ranch Estates (WRE), a general partnership (the partnership and its partners are hereinafter collectively referred to as the WRE Defendants), the Individual Defendants/Counterclaimants-Appel-lees,1 and Defendant-Appellee Tina Sohn *535(Sohn) ] to remove the tennis court from Lot 29 [of the Maui Meadows III (MM III) Subdivision],” majority opinion at 534, 985 P.2d at 1101, but not in its reasoning in arriving at that conclusion.

Further, I do not agree with the majority’s holding that “due to Pelosi’s laches in bringing the action to enforce the covenant as to the roadway, Pelosi is not entitled to a mandatory injunction to remove the roadway[,]” and the majority’s conclusion that “the [second circuit court (the court) ] did not abuse its discretion when it balanced the equities and declined to order removal of the roadway.” Majority opinion at 524, 985 P.2d at 1091. Rather, I would instruct the court to order the WRE Defendants, the Individual Defendants, and Sohn to remove the roadway as well as the tennis court from Lot 29 because both structures violated the November 5, 1971 MM III “Declaration of Restrictive Covenants” which limits the uses to which Lot 29 may be subjected (the MM III Covenants).

I.

In Pelosi v. Wailea Ranch Estates, 10 Haw.App. 424, 876 P.2d 1320, reconsideration denied, 10 Haw.App. 631, 879 P.2d 591, cert. denied, 77 Hawai'i 373, 884 P.2d 1149 (1994) (Pelosi I), this court remanded the case to the court with instructions to determine whether “Defendants [(the Pelosi I court referring to both the WRE Defendants and the Individual Defendants) ] deliberately and intentionally violated the MM III Covenants or intentionally assumed the risk of such violation^]” Id. at 446, 876 P.2d at 1331 (emphasis added). If such violation was found, this court ordered that “a mandatory injunction should issue forthwith, ordering Defendants to remove the roadway and tennis court on Lot 29.” Id. (emphasis added).

Nowhere in its instructions to the court did this court distinguish between the potential culpability of the WRE Defendants and the Individual Defendants or other subsequent purchasers as the majority does now. Further, on appeal in Pelosi I, and on remand to the court, none of the parties argued that the WRE Defendants’ liability and that of the Individual Defendants or Sohn was, or should be treated as, distinct from one another. The majority’s decision to make Pelosi’s remedy for violation of the MM III Covenants contingent upon ownership of Lot 29 at the time of trial or at the time of appeal is insupportable. The record clearly demonstrates that the MM III Covenants applied not only to the WRE Defendants, but to the Individual Defendants and Sohn as well.

II.

The Individual Defendants received notice of the restrictive covenant through the chain of title for each lot. The record contains warranty deeds for several of the lots in the WRE Subdivision.2 Each warranty deed in the record states that, together with the conveyance of the particular lot, each owner received “an undivided one-ninth (l/9th) interest ... of Lots 10,11, and 12 of [the WRE Subdivision].”

Lot 10 of the WRE Subdivision included Lot 29. Pelosi I, 10 Haw.App. at 430-31, 876 P.2d at 1324-25. The conveyance of Lots 10, 11 and 12 was specifically subject to, inter alia, the MM III Covenants, described in the deeds as “Restrictive Covenants and Conditions dated November 5, 1971, recorded in Liber 8403 at Page 464, affecting portions of Lot 10 of the [WRE] Subdivision.”

In their answers to Pelosi’s complaint, all of the WRE Defendants and the Individual Defendants admitted that Lot 29 was subject to the MM III Covenants. Sohn has never filed an answer in this case but does not contend otherwise.

Thus, the record plainly and amply demonstrates that notice of the MM III Covenants was in the chain of title for the lots in the *536WRE Subdivision. Indeed, the majority agrees that “the deeds of the Individual Defendants [including Sohn] to their respective lots in the WRE Subdivision incorporated the [MM III] Covenants so that ... the Individual Defendants [and Sohn] had at least constructive notice of the requirements of the covenant.” Majority opinion at 530, 985 P.2d at 1097 n. 3 (emphasis added).

III.

The first paragraph of the MM III Covenants contained the restrictive covenant at issue:

No lot shall be used except for residential purposes. No building shall be erected, placed or permitted to remain on any lot other than a single family dwelling not to exceed one and one-half stories in height and any accessory buildings.

Pelosi I, 10 Haw.App. at 428, 876 P.2d at 1323 (emphases added).

Considering the purpose of the MM III Covenants and the facts, this court concluded in Pelosi I that the subject covenant was “clearly breached” by Defendants:

In our view, the clear and unambiguous terms of the MM III Covenants, construed in accordance with their plain, ordinary, and accepted meanings, lead to but one conclusion: only one single-family dwelling and such buildings as are strictly accessory to the use of that dwelling may be constructed on an MM III houselot. Since Lot 29 contains no single-family dwelling, and the roadway and tennis court[3] on Lot 29 are accessory to residences in a completely different subdivision, the restrictive covenant was clearly breached.

Id. at 437, 876 P.2d at 1327 (emphasis added). The majority, however, leaves Pelosi without a remedy for the wrongful construction of a roadway on Lot 29.

IV.

The WRE Defendants apparently no longer hold an interest in Lot 29. After having-decided that the WRE Defendants intentionally violated the MM III Covenants, the majority observes:

[ I]t would be inequitable to preclude a person seeking to enforce the covenant from entitlement to mandatory injunctive relief merely because the violator of the covenant no longer holds an interest in the property. At the same time, we recognize that it may be unfair in certain situations to require an “innocent purchaser” of property on which a prior landowner has deliberately and intentionally violated or intentionally assumed the risk of violating a restrictive covenant to bear the brunt of a mandatory injunction to remove the covenant violation.

Majority opinion at 530-531, 985 P.2d at 1097-1098.

The import of this proposition is that a restrictive covenant runs only against the first purchaser, even if subsequent purchasers have notice of the covenant through their chain of title. Such a result is unacceptable if restrictive covenants are to have any meaning or effect. Contrary to the court’s and the majority’s view, the Individual Defendants and Sohn were not “innocent,” for subsequent purchasers with notice are bound to restrictive covenants:

An equitable restriction only binds a subsequent purchaser for value where the purchaser has acquired an interest with “notice” of the original promise. The requisite notice can be actual notice or “constructive” notice established by recordation of a prior instrument containing the restriction. ... Whether later deeds incorporate the restrictions or not, subsequent grantees take with notice of the recorded declaration of restrictions....

9 R. Powell & P. Rohan, Powell on Real Property § 60.01[2] at 60-10-60-11 (1998) [hereinafter Powell ] (emphasis added) (foot*537notes omitted). Accordingly, the mere transfer of interest in the land from the WRE Defendants to the Individual Defendants and Sohn did not nullify the covenant. The Individual Defendants and Sohn had notice of the MM III Covenants through the chain of title to their respective lots. Thus, they were and are bound by the MM III Covenants.

In this suit, neither the Individual Defendants nor Sohn sought to sue over as against the WRE Defendants for any damages which they might suffer as a result of the covenant’s breach. Thus, even the Individual Defendants and Sohn recognize that their rights and obligations were inextricably tied to the WRE Defendants4 since the subject covenant burdened the land, and is as binding on the WRE Defendants’ successors-in-interest to Lot 29 as it was on the WRE Defendants themselves.

V.

Unlike the majority, I believe the “relative hardship” doctrine does not apply to this case. In Sandstrom v. Larsen, 59 Haw. 491, 499, 583 P.2d 971, 978 (1978), the Hawai'i Supreme Court ruled that

[ a] basic consideration in the enforcement of restrictive covenants “is that they are enforceable through the equitable relief afforded by an injunction.” McDonough v. W.W. Snow [Constr.] Co., 131 Vt. [436,] 441, 306 A.2d [119,] 122 [ (1973) ]. As such, because the court is enforcing an established legal right embodied in the covenants, “the relative hardships to the parties has no application to the award of final relief to the plaintiff.” Id.

(Emphasis added). Thus, where a restrictive covenant is violated, the relative effects of enforcing it are not relevant.

In McDonough, cited by the Hawai'i Supreme Court, the Vermont Supreme Court observed that “ ‘[wfhether there will be greater hardship on the defendants than benefit to the plaintiff has no application here to the award of final relief to the plaintiff for the protection of established legal rights.’ ” 306 A.2d at 124 (emphasis added) (quoting Welch v. Barrows, 125 Vt. 500, 218 A.2d 698, 705 (1966) (holding that, where a defendant with notice of a restrictive covenant barring construction on a certain parcel of land had, nevertheless, erected one-and-one-half cabins on the restricted land, the proper remedy was to order removal of the cabins)). Thus, a restrictive covenant embodying “an established] legal right[]” may not be undermined by any supposed relative hardship brought about by its enforcement. McDonough, 306 A.2d at 124.

In Peters v. Davis, 426 Pa. 231, 231 A.2d 748, 752 (1967), another case relied on by the supreme court in Sandstrom, the Pennsylvania Supreme Court held that “[i]f a property owner, deliberately and intentionally violates a valid express restriction running with the land or intentionally takes a chance, the appropriate remedy is a mandatory injunction to eradicate the violation.” (Internal quotation marks omitted.)

Plainly, then, the application of the relative hardship doctrine is rejected where a defendant deliberately violated or intentionally takes a chance of violating a restrictive covenant. Sandstrom, 59 Haw. at 501, 583 P.2d at 979. Where, as here, subsequent purchasers, like the Individual Defendants and Sohn, had notice of the restrictive covenant and yet chose to proceed with the purchase of the offending property, I believe they have “intentionally take[n] a chance” and thus “a mandatory injunction [should issue] to eradicate the violation.” Id. at 500, 583 P.2d at 978 (citation and internal quotation marks omitted).

Under the majority’s approach, parties, like the WRE Defendants, can breach a restrictive covenant but preclude its enforcement and escape liability by simply selling the property. It appears, then, that the *538WRE Defendants could have escaped liability for breaching the restrictive covenant at any time during the course of the proceedings, either during trial, on remand, or on appeal, by simply transferring their interest in Lot 29.

Further, subsequent purchasers who have notice of the covenant, yet proceed to purchase the property, are excused as “innocent” because they purchased after the initial breach. Under the majority’s reasoning, it is difficult to determine exactly when a party, such as Pelosi, could ever enforce a restrictive covenant against a subsequent purchaser. The fact is the restrictive covenant continues to be and is currently being breached.

In sum, the relative hardship doctrine circumvents the plain purpose of a restrictive covenant. “The entire validity of the doctrine of relative hardship has been challenged on the ground that it cannot fairly be called a ‘hardship’ to enforce against a defendant a restriction of which he [or she] had knowledge or notice when he [or she] acquired his [or her] land." Powell, supra, § 60.10[1] at 60-152 (footnote omitted) (emphasis added) (citing Sandstrom,, 59 Haw. at 491, 583 P.2d at 971). Given the notice to the Individual Defendants and Sohn and the clear breach of the MM III Covenants, the relative hardship doctrine is simply not applicable in this case. Any supposed hardship to the Individual Defendants and Sohn was one of their own making.5

VI.

Further, I cannot concur in the majority’s belief that Pelosi’s right to enforce a restrictive covenant cannot extend to subsequent “innocent” purchasers. In Sandstrom, the supreme court addressed the ability of a successor-in-interest in land to enforce a restrictive covenant. The supreme court noted that under Hawai'i Rules of Civil Procedure (HRCP) Rule 25(c), a “successor-in-interest [to the benefit of a restrictive covenant] may be substituted as a named party and may continue to seek enforcement of the ... injunction.” Sandstrom, 59 Haw. at 502, 583 P.2d at 979. It follows that this rule, if applicable, allows a party, like Pelosi, to enforce a restrictive covenant against any successor-in-interest of the WRE Defendants who takes subject to the restrictive covenant.

HRCP Rule 25(c), entitled “Transfer of Interest,” provides that “[i]n case of any transfer of interest, the action may be continued by or against the original party, unless the court upon motion directs the person to whom the interest is transferred to be substituted in the action or joined with the original party.” (Emphasis added.) In this case, Pelosi filed suit against the WRE Defendants and Doe Defendants. Pelosi I, 10 Haw.App. at 432, 876 P.2d at 1325. He subsequently identified some of the Doe Defendants as the Individual Defendants. Id. Later, on remand, Pelosi joined Sohn. Majority opinion at 524, 985 P.2d at 1091 n. 1. Plainly, then, under HRCP Rule 25(c), Pelosi can maintain *539an action for injunctive relief against these WRE Defendants’ successors-in-interest.

VII.

Alternatively, even if the doctrine of relative hardship should be applied, the majority’s application of the doctrine under these facts leads to an inequitable result. “The doctrine of relative hardship, sometimes called ‘balancing the equities,’ is applied in situations in which the enforcement of a restriction will harm the defendant without substantially benefitting the plaintiffs land.” Powell, supra, § 60.10[3] at 60-150 (footnote omitted) (emphasis added).

Here, enforcement of the restrictive covenant will “substantially benefit[ ]” Pelosi. Id. As noted in Pelosi I, the purpose of the MM III Covenants was to “establish and insure a sound and proper subdivision for residential purposes.” 10 Haw.App. at 428, 876 P.2d at 1323 (brackets omitted). To effectuate that purpose, the MM III Subdivision was divided into 273 houselots and fifteen roadway parcels. Id. Use of the houselots, such as Pelo-si’s houselot and Lot 29, was restricted to residential purposes. Id. Pelosi purchased his lot with the belief that the neighboring lot would be used for a houselot, not that it would be used for a roadway and tennis court of an adjoining subdivision. Enforcing the restrictive covenant would obviously preserve and thus substantially benefit the residential nature of the MM III Subdivision and Pelo-si’s lot, as was intended when the MM III Subdivision was created.

VIII.

The majority, however, further finds that in balancing the equities, Pelosi was guilty of “laches.” Although laches was raised as an affirmative defense in the answers filed by the WRE Defendants and the Individual Defendants and at trial, there has never been an express finding that Pelosi committed laches.

Assuming that the equitable defense of laches could be applied by this court at this late stage in the proceedings,6 the facts of this case do not support the conclusion that Pelosi committed laches.7

The majority concluded, 'in relevant part, as follows:

Our review of the record indicates that there was substantial evidence adduced below to support the ... court’s findings that the roadway was substantially completed by July 1987 and that Pelosi did not express concerns about the roadway until late 1987 at the earliest. ...
Since Pelosi waited until May 1988 to formally request that the WRE Defendants remove the roadway and until August 1988 to file the instant action, we cannot conclude that the ... court erred when it considered Pelosi’s delay, balanced the equities, determined that closing up the roadway would deprive the Individual Defendants of access to the WRE Subdivision and create too much of a hardship on them, and consequently, declined to award Pelosi mandatory injunctive relief.

Majority opinion at 532, 985 P.2d at 1099 (underscored emphasis in original) (italicized emphases added).

A.

With respect to the equitable defense of laches, the Hawai'i Supreme Court has ruled that

[ t]he doctrine of laches reflects the equitable maxim that “equity aids the vigilant, not those who slumber on their rights.” Where applicable, it acts to bar a court from considering an equitable action ... because of a perception that it is more equitable to defendants and important to *540society to promote claimant diligence, discourage delay and prevent the enforcement of stale claims.

Adair v. Hustace, 64 Haw. 314, 320-21, 640 P.2d 294, 300 (1982) (quoting 2 S. Symonds, Pomeroy’s Equity Jurisprudence § 418 (5th ed.1941)) (footnote omitted).

Two components must exist before the doctrine of laches will apply. Adair, 64 Haw. at 321, 640 P.2d at 300. “First, there must have been a delay by the plaintiff in bringing his claim, and that delay must have been unreasonable under the circumstances.” Id. “Second, that delay must have resulted in prejudice to the defendant.” Id. The supreme court further emphasized that “‘[i]n suits in equity the question [of diligence] is determined by the circumstances of each particular case.’” Id. (quoting Patterson v. Hewitt, 195 U.S. 309, 317, 25 S.Ct. 35, 49 L.Ed. 214 (1904)).

Also, with respect to injunctive relief in general, a complainant is entitled to a reasonable time in which to decide whether injunc-tive relief should be sought:

Lapse of time will not defeat a complainant’s right to injunctive relief unless it appears that he had knowledge or ample means of knowledge of all the circumstances upon which his rights depend, and of the violation or threatened violation of those rights, since without such knowledge or means of acquiring knowledge implied assent cannot be imputed to him, nor can it be said that he permitted the defendant to proceed to his disadvantage.... [ 0]ne is not required to seek injunctive relief as soon as he obtains knowledge of the facts entitling him thereto; he is allowed a rear sonable time in which to consider whether it is advisable to seek such relief.

42 Am.Jur.2d Injunction § 63 at 809 (1969) (emphasis added). Under the circumstances, I do not believe Pelosi unreasonably delayed bringing his claim.

B.

Pelosi testified that the ultimate use of Lot 29 as a roadway lot was not immediately evident since the lot was initially used to transport materials to the subdivision:

In the second half of 1987, we noticed that a dirt path was cleared through the mountain side of the lot, that is Lot 29, the lot next [door] to us, and all kinds of vehicles, machines and trucks were going back and forth, and we figured they [wejre using this as a way to do some work back there.
Subsequently, they concerned [sic] some more of [Lot 29] and kept bringing in all kind of fill materials, building [Lot 29] up. And then, finally, in the latter part of 1987, they brought in more fill and material, and it was to the point that next to our property line there were about five feet, there was a bank about five feet high and they were all spilling, trespassing onto our property.
[[Image here]]
[Construction of the tennis court began a]fter they paved the road, either the end of1987 or beginning ofl988[.J

(Emphases added.)

Pelosi did not simply wait until May 1988 to request removal of the roadway as the majority intimates. He testified that in October or November 1987 he requested information on the WRE Subdivision and the use of Lot 29. In response, Defendant-Appellee Eduardo F. Bello (Bello), one of the WRE partners, gave Pelosi a packet of information describing the WRE Subdivision. The packet contained a map which showed access to the WRE Subdivision through Lot 29, but did not specify the type of access over Lot 29.

Pelosi also testified that “around the same time,” October or November 1987, three of the WRE partners, Defendants-Appellees Hugh Jeffrey Farrington (Farrington), John Kean (Kean), and Stephen K. Rink (Rink), “barg[ed]” into his office. Pelosi related he told Farrington, Kean, and Rink that construction of a roadway and tennis court on Lot 29 by WRE would be “a violation of the [MM III] Covenants[.]” According to Pelosi, Farrington, Kean, and Rink denied that a roadway was being built on Lot 29. Instead, Farrington, Kean, and Rink stated that WRE was building “just a private driveway.” They also stated that WRE was “considering” building a tennis court on Lot 29. See *541Majority opinion at 529, 985 P.2d at 1096 n. 2.

However, as the majority observes in a footnote, more than a year earlier, a March 12, 1986 letter from WRE partner, Defendant-Appellee Stephen Pitt (Pitt), to Alvin K. Fukunaga, Director of Public Works for the County of Maui (County), “clearly reveals that the roadway and tennis court were part of the WRE Defendants’ initial plans for Lot 29.”8

According to Pelosi, after the subject meeting, he made several attempts to find out what was occurring on Lot 29. Pelosi testified that he “phoned the County[, and] ... went up to the County Land Use [Office], in person,_to look at maps and ... the subdivision folder, [and/or] meet with someone to get details.”

In a letter dated November 10, 1987 from Pelosi to Kenneth Kong of the Land Use and Codes Administration of the County, Pelosi asked about the uses of Lot 29 for a tennis court and roadway and County approvals of such uses.9 From the record, it appears that Pelosi did not receive a response to his letter.10

Then, as noted in a letter dated May 18, 1988, Pelosi’s attorney, Edward F. Mason (Mason), notified Rink of Pelosi’s demand that the WRE Defendants remove the roadway and return Lot 29 to residential purposes.11

In a letter dated May 26, 1988, Rink responded that WRE believed the construction on Lot 29 did not violate the MM III Covenants and that “[t]he partnership ... intends to completed [sic] the tennis court.”

*542Mason sent a follow-up letter to Rink dated August 10, 1988. That letter advised Rink that a complaint would be filed on August 16, 1988, “unless by that date [WRE] ha[d] agreed either to remove the road and tennis court from Lot 29 or ha[d] otherwise made an acceptable settlement offer to [Pelo-si].” Thereafter, on August 26, 1988, Pelosi filed his verified complaint in the court.

Assuming Pelosi was aware of the use of Lot 29 as a roadway in July, he took a little more than a year to file suit; assuming, as he testified, that the permanency of the roadway only became evident toward the end of 1987, suit was filed in less than a year. In the meantime, he apparently sought the intervention of the County, the cooperation of the WRE Defendants, and the help of an attorney. Certainly, delay was caused by the WRE Defendants because as the majority recognizes, the WRE Defendant “were not candid with Pelosi about their plans for the lot.” Majority opinion at 529-530, 985 P.2d at 1096-1097. I do not believe the steps taken by Pelosi unreasonably delayed the case under the circumstances. They were rational and prudent steps taken in deciding whether it was “advisable to seek” ultimate relief through the court. 42 Am.Jr.2d, supra, at 809.

C.

Even assuming that Pelosi’s delay was unreasonable, I do not believe the delay “resulted in prejudice to the defendants].” Id.

I do not see how, given their knowledge of the covenant and their subsequent conduct, it could be said that the WRE Defendants would be prejudiced in any way by a supposed unreasonable delay. They simply chose to disregard the covenant.

Like the WRE Defendants, the Individual Defendants and Sohn had notice that Lot 29 was subject to the MM III Covenant at issue and yet chose to purchase lots in the WRE Subdivision. Presumably, those of the Defendants who purchased subsequent to the filing of Pelosi’s complaint would have had additional notice by way of the pending litigation.12 Accordingly, whatever delay might be attributable to Pelosi had no effect on the conduct of the Individual Defendants and Sohn.

IX.

Assuming arguendo that the equities must be balanced, I believe the court and the majority are incorrect in prohibiting Pelosi from adducing evidence that an alternative means of access to the WRE Subdivision may be available. See Pelosi I, 10 Haw.App. *543at 442 n. 5, 876 P.2d at 1329 n. 5 (noting that Pelosi “contends that there is a ‘fire break’ road available to Defendants and that Lot 29 is merely the most convenient access to [the WRE Subdivision]”).

During trial, Kean testified that the fee break road was initially used as access to the WRE Subdivision:

[Counsel for Pelosi]: At the time of the purchase of the 20 acres, or right before, I believe, you told me that you had seen or been over a temporary access to those 20 acres through ... one of the roads that ends at [MM III Subdivision], you are aware of which one I mean, because we went over that?
[Kean]: The fire break.
[Counsel for Pelosi]: Whatever you want to call—
[Kean]: It was a fee break.
[Counsel for Pelosi]: That was a temporary access to that 20 acres?
[Kean]: Fire break is a temporary access, because the Lot 39 was not 29, was not yet graded. We brought on the fire break above to the 20 acres with initial—
[Counsel for Pelosi]: You got back and forth through it, through the fire break?
[Kean]: Initially, initially.
[Counsel for Pelosi]: That is a rough fee break?
[Kean]: Very tough.
[Counsel for Pelosi]: You can get there?
[Kean]: I could.

(Emphases added.)

Subsequently, Paul Mancini (Mancini), an attorney for ‘Ulupalakua Ranch (Ranch), testified that Ranch consolidated Lot 29 into a larger twenty-acre lot prior to conveying the subdivision to the WRE Defendants in order to provide the “most convenient access” to the subdivision:

[Mancini]: ... By consolidating Lot [29] with the larger lot, we only had one lot we could sell the whole property to the purchasers.
[Counsel for WRE Defendants]: Can you tell the [c]ourt and the [j]ury why there was that consolidation?
[Mancini]: Well, ... Ranch had owned Lot [29] and it appeared that this was the most convenient type access into this property for these people who wanted to buy the property.

(Emphasis added.)

Following trial, on December 6, 1990, the court entered findings of fact (findings) and conclusions of law (conclusions) adverse to Pelosi on his claims for injunctive and declaratory relief. Finding 9 stated, “Following its acquisition of Lot 29 and the adjoining parcel, [the WRE Defendants] constructed a tennis court on Lot 29 and a road across Lot 29. Said road was absolutely necessary as an access to the [WRE] Subdivision ... as every subdivision, to be legal, must have an access.” (Emphasis added.) Pelosi appealed from finding 9, contending that the fee break road is “a possible alternate access” to the subdivision. Pelosi I, 10 Haw.App. at 435, 876 P.2d at 1326. This court, however, found it “unnecessary” to address Pelosi’s appeal with respect to the fee break road because this court concluded “as a matter of law, that [the WRE Defendants and the Individual Defendants] breached the restrictive covenant in question.” Id.

During remand, Pelosi moved the court to allow testimony on the issue of an alternative access to the WRE Subdivision. Attached to the motion was an affidavit of Spencer C. Ryland, P.E., a licensed professional engineer in the State of Hawai'i (Ryland). Ry-land prepared a report “concerning the feasibility of constructing an access road to [the WRE Subdivision] from Launa Drive, one of the public roads on the [MM III] Subdivision” (the report). A copy of the report was attached to Ryland’s affidavit and stated as follows:

An existing fee break road already exists along the proposed alignment.... It is understood that this existing rough-graded road provides emergency fire access along the northern boundary of [the WRE Subdivision]. This road connects to the existing paved water reservoir access roadway on Launa Drive.
Upgrading the existing road to a residential access roadway which satisfies Maui County Design Standards would be a rela*544tively straightforward, simple process from a civil engineering perspective. The most challenging portion would be crossing a small drainage gulch. This would be accomplished with twin-arch culverts and a fill, similar to the ones presently existing in Plat 19 of [MM III Subdivision] downstream of the proposed crossing.
Outside of this minor drainage construction, the roadway would be constructed using a leveling course of crushed aggregate subbase on top of the existing solid rock, asphalt treated base on top of the subbase, and a surface wearing course of asphalt concrete.

(Emphasis added.) The report included a map showing the location of the fire break road and photographs of the road.

The court denied Pelosi’s motion.

I believe this was an abuse of discretion.

In Pelosi I, this court did not instruct the court on remand to restrict its review of the evidence to that adduced at trial. 10 Haw. App. at 446, 876 P.2d at 1331. Indeed, this court did not decide whether finding 9, which was appealed by Pelosi, was correctly made, thus leaving that issue open on remand in conjunction with its instruction that “the trial court may balance the equities.” Id. Therefore, in order for the court to fairly “balance the equities,” evidence of an alternative access which obviated any alleged hardship should have been considered. However, on remand, the court apparently took the position that it was not going to receive any evidence outside of that which had already been received at trial.13

X.

Finally, the case should be remanded for a determination of damages which have been and/or will be suffered by Pelosi as a result of the breach of covenant.

On November 29, 1995, Pelosi filed a “Memorandum on Damages” in which he asserted that breach of the restrictive covenant caused (1) diminution in value of Pelosi’s property in the amount of $100,000 to $150,-000, and (2) loss of the economic use of Pelosi’s property in the amount of $34,160.

On December 6, 1995, the Defendants (ostensibly the WRE Defendants and the Individual Defendants) filed their “Responsive Memorandum on Damages,” arguing that Pe-losi was not entitled to damages in addition to the $20,000 already awarded by the jury on Pelosi’s nuisance claim.

Pelosi was awarded a nominal judgment of two dollars for breach of the covenant. In its findings the court apparently disregarded Pelosi’s testimony because (1) the jury had made an award for nuisance caused on Lot 29, and (2) Pelosi’s claims were based on his own opinion.14

*545I believe the court was in error. First, at trial, the jury found that the restrictive covenant had not been breached. In contrast, Pelosi I determined, as a matter of law, that the restrictive covenant had been breached. Because the jury erroneously found that there was no breach of covenant, Pelosi could not have been fully compensated under the jury’s nuisance award. Thus, Pelosi has a claim for special and consequential damages against the Defendants arising from violation of the restrictive covenant. See Powell, supra, § 60.07 at 60-121-60-122.

Second, I believe Pelosi’s own testimony concerning the value of his land following the breach of the covenant was sufficient without any other evidence to establish his purported damages. See Territory v. Adelmeyer, 45 Haw. 144, 158, 363 P.2d 979, 987 (1961) (“An owner, by virtue of his ownership and consequent familiarity with the land and real estate market, is generally held to be qualified to give his opinion as to the value of his land, the weight to be given such testimony being a question for the jury.”) Therefore, the nominal judgment should be set aside and the issue of damages for breach of the covenant remanded for redetermination.

. The phrase "Individual Defendants” as used herein refers to the named Individual Defendants/Counterclaimants-Appellees at the time this court issued its opinion in Pelosi v. Wailea Ranch Estates, 10 Haw.App. 424, 876 P.2d 1320, reconsideration denied, 10 Haw.App. 631, 879 P.2d 591, cert. denied, 77 Hawai'i 373, 884 P.2d 1149 (1994) (Pelosi I), who were identified as the owners of individual lots in the Wailea Ranch Estates (WRE) Subdivision, and who shared an undivided interest in Lot 29 of the Maui Meadows III (MM III) Subdivision. Defendant-Appel-lee Tina Sohn (Sohn) was not joined as a defendant until after the remand required under Pelosi *535I and is referred to separately from the Individual Defendants.

. Warranty deeds for WRE Subdivision lots 1, 2, 3, 4, 6, 7, and 9 are attached to the deposition of Jeannie Wenger, the Custodian of Records for Standard Title & Escrow (Standard), which is included in the record on appeal. All of those warranty deeds state that the conveyance was subject to the November 5, 1971 MM III "Declaration of Restrictive Covenants" (the MM III Covenants).

. In Pelosi I this court did not make any specific conclusions regarding whether or not a tennis court constituted a "residential purpose” under the MM III Covenants. Instead, this court apparently concluded that the MM III Covenants were breached because the tennis court on Lot 29 was "accessory to residences in a completely different subdivision.” 10 Haw.App. at 437, 876 P.2d at 1327.

. During the initial proceedings in the second circuit court (the court), the appeal that led to Pelosi I, and the subsequent remand, Defendant-Appellee Wailea Ranch Estates, a general partnership, and its partners (collectively the WRE Defendants) and the Individual Defendants were represented by the same counsel. During this current appeal, the WRE Defendants and the Individual Defendants are all represented by the same counsel. The Individual Defendants did not file any appellate briefs separate from those of the WRE Defendants. Neither the Individual Defendants nor Sohn filed cross-claims or third-party complaints against the WRE Defendants.

. The majority relies, in part, on Horvath v. Gladstone, 97 Nev. 594, 637 P.2d 531 (1981) (per curiam).

I do not find Horvath persuasive. That case involved an appeal from a summary judgment granted the Gladstones, who had obtained an order requiring the Horvaths to remove the second story of the Horvaths’ home. Id. at 533. Summary judgment was granted on the basis of res judicata because the Gladstones had obtained a court order in a prior lawsuit directing the Gregorys, the previous owners of the home, to remove the second story. Id. at 532.
On remanding, the Nevada Supreme Court said that the relevant question was whether the Horvaths "had actual or constructive notice of [prior] litigation so as to preclude the balancing of equities ... [,]" id. at 533 n. 3, even though the Horvaths admittedly "had constructive notice of the [restrictive covenant].” Id. at 533. It is important to note that the Horvaths had purchased the home while the Gladstones' ultimately successful appeal from the trial court’s ruling in the Gregorys’ favor was pending. Id. at 532.
Horvath ignores the rule that "a legal right embodied in the covenants” precludes a "relative hardship evaluation[,]” Sandstrom v. Larsen, 59 Haw. 491, 499, 583 P.2d 971, 973 (1978) (internal quotation marks and citations omitted), and thus is subject to the same objections discussed in the text supra. If followed in this jurisdiction, Horvath would establish a new rule which, at most, would require the majority, as in Hoivath, to remand this case to determine which one of the Defendants "had actual or constructive notice of [the] litigation so as to preclude the balancing of equities” in their behalf. Horvath, 637 P.2d at 533. Such an approach poses even more conceptual problems.

. I question whether on appeal this court can, in effect, make a finding of laches, a fact-intensive determination which is left to trial courts.

. In Pelosi v. Wailea Ranch Estates, No. 20254, 91 Hawai'i 137, 980 P.2d 1011 (Haw.App. May 1, 1998) (mem.), vacated and remanded, No. 20254 (Haw. June 12, 1998) (order), this court ruled that a mandatory injunction should issue against the WRE Defendants and the Individual Defendants for removal of both the roadway and the tennis court. Now, under the same facts and record, the majority determines that laches bars Pelosi’s claim with respect to the roadway. Without additional facts supporting a claim for laches, I cannot agree with the majority’s change of opinion.

. That letter stated, in relevant part:

The ... preliminary subdivision approval [of the County of Maui (County) ] dated January 20th, 1986, Section l.C requested that a fire hydrant be installed to serve Lot [29]. It is requested that this requirement be dropped due to the fact that Lot [29] is a roadway lot. The remnant of the land remaining after roadway construction is smaller than County requirements for residential construction. The intent in this instance is to construct a tennis court on this portion of land.

Majority opinion at 529, 985 P.2d at 1096 n. 2 (emphasis in original).

. The November 10, 1987 letter stated, in part:

You may recall our telephone conversation regarding my concerns with the kind of landscape modification that is taking place adjacent to and mauka of my residence!.] My wife shares these concerns.
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A visit to the Real Property Tax Division revealed that TMK 2-1-19-85 [Lot 29] had been dropped. The elimination of this parcel/lot and its use, now and in the future, for purposes other than those for which it was intended, gives rise, in my opinion, to numerous concerns and problems.
I will defend people's right to develop their property provided that what they do is allowed by law and governmental agencies, and does not negatively affect others. However, my concerns lead me, for the moment, into asking the County the following questions:
1. Is what used to be Lot 29 going to be used for a sort of “community” tennis court? In other words, would what used to be a residential lot in one subdivision be used for these purposes by the owners of lots in a different subdivision? If this has been approved, who approved it?
2. Who approved the use of Lot 29 (TMK 2-1-19-85) as a road for access from an existing subdivision [MM III] to a new subdivision [WRE Subdivision]?
A written reply at your earliest convenience will be appreciated.

(Emphases added.)

. While the issue is not raised by the parties, this case may raise serious questions about whether a governmental agency whose attention has been called to a recorded restrictive covenant (which does not violate public policy) may lend approval to clear violations of that covenant.

. The letter stated, in relevant part, as follows:

Obviously Lot 29 is not being used by your client [ (WRE) ] for residential purposes but for a roadway to service its subdivision. The use of the lot in this fashion not only violates the [MM III CJovenants bat constitutes an offensive nuisance in its own right. The idea that your client would in addition erect a tennis court on the property simply aggravates its violation of the covenants and its creation of a nuisance in a residential neighborhood.
My clients [ (Pelosi and his wife) ] have attempted to discuss this matter on a number of occasions with you and your client, all to no avail. By this letter demand is hereby made upon your client to remove its road from Lot 29, together with all other asphalt covering, and to regrade the same and return it to residential uses. If this is not done within the next ten days, then the aid of the courts will be sought without further notice to you.

(Emphasis added.)

. At the least, a title search should have disclosed the pending litigation.

The record indicates that counsel for Pelosi sent letters dated August 26, 1988 to (1) Standard, an escrow company handling sales of lots in the WRE Subdivision, and (2) Security Title Corporation (Security), purported to be an escrow company also involved in the sale of lots in the WRE Subdivision, notifying both companies that Pelosi had filed a complaint concerning the use of Lot 29 and requesting Standard and Security to "please notify the [potential b]uyers of [the lots in the WRE Subdivision] that the [c]omplaint filed by ... Pelosi seeks to restrain the further use of [Lot 29] as a roadway access to the subdivision and as a tennis court.”

It may be noted that the record contains a document entitled "Preliminary Report,” prepared by Title Guaranty of Hawaii, Inc. and dated March 2, 1990, which was identified at trial, but not introduced into evidence. The preliminary report, which was for Lot 6 of the WRE Subdivision, clearly showed that title to that lot was subject to the MM III Covenants and Pelosi’s pending lawsuit:

Title Guaranty of Hawaii, Inc. hereby reports that title to [Lot 6 of the WRE Subdivision] is vested in:

O'GREEN ESTATE

a [Hawai'i] registered general partnership Subject only to those matters set forth in Schedule "B" hereof. This report is to the hour of 8:00 o'clock a.m. on March 2, 1990.
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SCHEDULE B

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3. -AS TO [Lots 10, 11, and 12 of the WRE Subdivision] :-
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(C) Covenants, conditions and restrictions dated November 5, 1971, recorded in Liber 8043 at Page 464.
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8. Pending Civil No. 88-0422(3), filed in the Circuit Court of the Second Circuit, State of [Hawai'i], ANGELO PELOSI (Attorney(s) Edward F. Mason and Eugene S. Evans, Jr.), "Plaintiff”, vs. WAILEA RANCH ESTATES, a [Hawai'i] General Partnership, et ah, “Defendants,” re: use of Lot 29.

. The transcript of the November 16, 1995 hearing indicates as follows:

[COUNSEL FOR PELOSI]: I filed a motion on the first part. I asked the [c]ourt to issue a mandatory injunction removing the record [sic] because the defendants had intentionally or taken a chance on violating the covenants.
THE COURT: That’s the one I had the findings of fact.
[COUNSEL FOR PELOSI]: That's correct, but in addition to that, and without being asked, you also did what I guess the phrase is balance of the equities and denied it. I think that the Intermediate Appellate Cowl intended additional evidence to be received on that issue. You didn’t receive it. I'm asking you to receive it.
THE COURT: And at our last hearing it was brought up, I think it was brought up at the last hearing when I ruled on the first issue. It was brought up orally. [Counsel for Defendants] had not yet responded, as I recollect, but you had already filed your motion for additional testimony.
[COUNSEL FOR PELOSI]: That’s correct.
THE COURT: And that’s why I wondered why we’re here today because I already told you guys I’m not going to hear any evidence on this. The only thing I’m going to hear evidence on, and I asked you guys to submit, and, in fact, [Counsel for Pelosi], as I recollect you were going to submit a memo [ (on damages).]
[COUNSEL FOR PELOSI]: That’s correct.
THE COURT: That’s all that’s remaining, as far as I'm concerned. This motion, although technically was not brought up at the last time,
I did rule on it orally and my ruling was I was going to deny that motion. Same thing. Okay.

(Emphases added.)

. The court's findings of fact stated, in relevant part:

4. Activities associated with the construction, use and maintenance of the tennis court[ ] and roadway were considered by the jury at trial in their award to [Pelosi] for his nuisance cause of action.
*5455. The continuation of these activities could have arguably had an affect [sic] on the adjacent property values.
6. [Pelosi] is a licensed real estate broker and gave his estimate of what amount of diminution in value to his property the construction of Lot 29 has caused.
7. [Pelosi’s] conclusion that his lot should be worth $500,000 but could not sell for more than $360,000 to $375,000 were he to disclose the use of Lot 29 is based upon his own review of what was selling and comparable sales as well as his perceived loss of his ability to enjoy his property as he should.
8. This conclusion was based entirely upon [Pelosi’s] opinion and was not substantiated or corroborated by any other evidence.
9. Even if [Pelosi] were qualified as an expert in land appraisal, his opinion would still have required some basis in fact which could be readily identified and substantiated.
10. [Pelosi] did not call any other witnesses to include residents of his property, tenants of his property, experts on property appraisals, other brokers or even neighbors to substantiate his conclusions as to diminution of value and loss of economic use of his property.

(Emphases added.)