L}:’tz»f‘a ii §,§ _S`S{A§:{y
NOT FOR PUBLICATION IN WES'I"S'HAWAI‘I REPORTS AND PACIFIC REPORTER
NOS.
29338 and 29524
IN THE INTERMEDIATE COURT OF APPEALS`
OF THE STATE OF HAWAfI
NO. 29338
GARY BART; EARL G. BART TRUST; GARY D. STICE
',.»~4
W
APOLONIA A. STICE; PARALUMAN P. STICE-DURKIN;
LIGAYA L. STICE-BEREDINO; EDWIN T. CRYER;
ANN C. HARTHORN; MURCIA-TORO, INC., a NeVada
corporation duly registered in the State of HawaiH4
CHARO RASTEN; CARMEN LESHER; CAROLINE D. SIMPSON;
SMITH FAMILY TRUST; E. BRIAN SMITH; BARBARA J. BAKER;
STEPHEN L. BAKER; HELFERICH FAMILY TRUST; UDO HELFERICH;
FARAH HELFERICH; DIANE G. FAYE TRUST; DIANE D. FAYE TRUST,
LINDSAY C. FAYE TRUST; NAN GUSLANDER; WHIT L. PRESTON;
HILARY PRESTON; MICHAEL J. TIERNAN; ELIZABETH T. TIERNAN;
MARGARET SULLIVAN; WILLIAM VAN DYK; PIETER S. MYERS;
MARK G. MORAN; AND CAPRICE R. MORAN,
Plaintiffs-Appellants,
v.
BOARD OF LAND AND NATURAL RESOURCES,
STATE OF HAWAfI; DEPARTMENT OF LAND AND NATURAL
RESOURCES, STATE OF HAWAfI; and LAURA THIELEN,
in her capacities as Chairperson of the BOARD
OF LAND AND NATURAL RESOURCES and AdministratOr
of the DEPARTMENT OF LAND AND NATURAL RESOURCES,
Defendants-Appellees
(Civil No.
08-01-0030)
and
NO. 29524
GARY BART; EARL G. BART TRUST; GARY D. STICE;
APOLONIA A. STICE; PARALUMAN P. STICE-DURKIN;
LIGAYA L. STICE-BEREDINO; EDWIN T. CRYER;
ANN C. HARTHORN; MURCIA-TORO, INC., a Nevada
corporation duly registered in the State of HawaiU4
CHARO RASTEN; CARMEN LESHER; CAROLINE D. SIMPSON;
BARBARA J. BAKER; STEPHEN L. BAKER; HELFERICH FAMILY TRUST;
UDO HELFERICH; FARAH HELFERICH; DIANE G. FAYE TRUST;
DIANE G. FAYE; DIANE D. FAYE TRUST; DIANE D. FAYE;
LINDSAY C. FAYE TRUST; LINDSAY C. FAYE; NAN
GUSLANDER TRUST; NAN GUSLANDER; L. WHIT PRESTON TRUST;
L. WHIT PRESTON; HILARY PRESTON TRUST; HILARY PRESTON;
MICHAEL J. TIERNAN; ELIZABETH T. TIERNAN; MARGARET
SULLIVAN; WILLIAM A. VAN DYK; PIETER S. MYERS;
MARK G. MORAN; CAPRICE R. MORAN, IVE REVOCABLE TRUST;
HEATHER IVE; JONATHAN IVE;
and TROY ECKERT,
Plaintiffs-Appellants,
v.
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NOT FOR PUBLICATION IN WEST'S HAWAI‘I REPORTS AND PACIFIC REPORTER
BOARD OF LAND AND NATURAL RESOURCES,
STATE OF HAWAfI; DEPARTMENT OF LAND AND NATURAL RESOURCES, STATE
OF HAWAfI; and LAURA H. THIELEN, in her capacities as
AdminiStratOr of the STATE OF HAWAfI DEPARTMENT OF LAND AND
NATURAL RESOURCES, and Chairperson of the BOARD OF LAND AND
NATURAL RESOURCES, Defendants-Appellees
(Civil No. 08-01-OO77)
APPEAL FROM THE CIRCUIT COURT OF THE FIFTH CIRCUIT
\ MEMORANDUM OPINION
(By5 Nakamura, C.J., Foley and Fujise, JJ.)
In this consolidated appeall arising out of a dispute
over land use, the following parties appealed from the following
Final Judgments entered in the Circuit Court of the Fifth
Circuit2 (circuit court):
(l) In Civil No. O8~Ol-OO30, an agency appeal,
Appellants-Appellants Gary Bart; Earl G. Bart Trust; Gary D.
Stice; Apolonia A. Stice; Paraluman P. Stice~Durkin; Ligaya L.
Stice-Beredino; EdWin T. Cryer; Ann. C. Harthorn; Murcia-Toro,
Inc , a Nevada corporation duly registered in the State of
Hawafi; Charo Rasten; Carmen Lesher; Caroline D. Simpson; Smith
Family Trust; E. Brian Smith; Barbara J. Baker; Stephen L. Baker;
Helferich Family Trust; Udo Helferich; Farah Helferich; Diane G.
Faye Trust; Diane D. Faye Trust; Lindsay C. Faye Trust; Nan
Guslander; Whit L. Preston; Hilary Preston; Michael J. Tiernan;
Elizabeth T. Tiernan; Margaret Sullivan; william van Dyk; Pieter
S. Myers; Mark G. Moran; and Caprice R. Moran (Agency Plaintiffs)
appealed from the Final Judgment entered on August 7, 2008 in
favor of Appellees~Appellees Board of Land and Natural Resources,
State of Hawafi (BLNR); Department of Land and Natural
Resources, State of HawaFi (DLNR); and Laura H. Thielen
l On January 9, 2009, this court granted a stipulation to consolidate
appeal Nos.. 29338 and 29524. Although the majority of the same parties appear
as plaintiffs in both appeals, there is a difference in the parties.
2 The Honorable Kathleen N.A. Watanabe presided.
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(Thielen) in her capacities as Chairman of the BLNR and
Administrator of the DLNR (collectively, Defendants or
Appellees).
(2) In Civil No. 08-1-0077, a complaint for
declaratory judgment and injunctive relief, Plaintiffs-Appellants
Gary Bart; Earl G. Bart Trust; Gary D. Stice; Apolonia A. Stice;
o Paraluman P. Stice-Durkin; Ligaya L. Stice-Beredino; Edwin T.
Cryer; Ann. C. Harthorn; Murcia-Toro, Inc., a Nevada corporation
duly registered in the State of HawaFi; Charo Rasten; Carmen
Lesher; Caroline D. Simpson; Barbara J. Baker; Stephen L. Baker;
Helferich Family Trust; Udo Helferich; Farah Helferich; Diane G.
Faye Trust; Diane G. Faye; Diane D. Faye Trust; Diane D. Faye;
Lindsay C. Faye Trust; Lindsay C. Faye; Nan Guslander Trust; Nan
Guslander; L. Whit Preston Trust; L. Whit Preston; Hilary Preston
Trust; Hilary Preston; Michael J. Tiernan; Elizabeth T. Tiernan;
Margaret Sullivan; William A. van Dyk; Pieter S. Myers; Mark G.
Moran; Caprice R. Moran; Ive Revocable Trust; Heather Ive;
Jonathan Ive; and Troy Eckert (Civil Plaintiffs) appealed from
the Final Judgment entered on November l7, 2008 in favor of
Defendants.
we will refer to Agency Plaintiffs and Civil Plaintiffs
collectively as Appellants. On appeal, Appellants raise the
following points of errors:
A. Agency Appeal
l. Did the Circuit Court err when it dismissed
Appellants' HRS [Hawaii Revised Statutes] chapter 91
appeal on the grounds that the Court lacked subject
matter jurisdiction to review the [BLNR's] denial of
Appellants' Petition and its denial of Appellants'
request for contested case hearing although HRS
§ 183C~8 authorizes appeals in accord with chapter 91
from any final order of the DLNR?
2. Did the Circuit Court err in dismissing the chapter 91
appeal pursuant to HRCP [Hawafi Rules of Civil
Procedure] Rule l2(b)(1) on the grounds that no
"contested case hearing" had been held even though the
[BLNR’s] denial of the Petition was final, was made in
a public meeting required by law, and the Petition was
a request that the [BLNR] determine Appellants' legal
"rights, duties, or privileges" under their CDUPs
[conservation district use permits]?
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3. Did the Circuit Court err in holding that the [BLNR's]
December l4, 2007 public meeting in which Appellants‘
Petition was denied was not a "contested case hearing"
for purposes of jurisdiction under HRS § 91-14?
4. Did the Circuit Court err in failing to remand the
action to the BLNR for the BLNR to rule on Appellants'
request for a contested case hearing because the
Chairperson lacks authority to deny requests for
contested case hearings and only the BLNR has the
authority to allow or deny a contested case?
B. Declaratory Judgment Action
1. Did the Circuit Court err when it granted summary
judgment to all claims on the grounds that as a matter
of law, Appellants were not entitled to a contested
case hearing on the merits of the Petition?
2. Did the Circuit Court err in granting summary judgment
as a matter of law on the grounds that the no-rental
rule and conditions are not vague or ambiguous and
give fair notice that certain conduct is prohibited
where it is undisputed that both Appellees themselves
and the Circuit Court have been unable to articulate
what conduct is prohibited by the no-rental rule and
conditions, and there was evidence of inconsistent
enforcement?
3. Did the Circuit Court err when it granted summary
judgment to all claims alleged in the Complaint on the
grounds that as a matter of law, the no-rental
conditions in the CDUP are not overbroad when there
were undisputed facts in the record demonstrating that
the [BLNR] had previously admitted the no~rental
conditions are "unreasonable" and not enforceable and
there were undisputed facts in the record
demonstrating that the DLNR itself conducts short-term
vacation rental in the Conservation District and thus
there was a genuine issue of material fact as to
whether the no~rental conditions are consistent with
the purposes of the Conservation District in HRS
[Chapter] l83C?
4. Did the Circuit Court err when it refused or failed to
decide whether the no-rental rule and condition, as
apparently interpreted by the Circuit Court, exceeded
statutory authority of the BLNR and whether they were
inconsistent with the standards of HRS [Chapter] l83C?
5. Did the Circuit Court err in granting summary judgment
as a matter of law that the denial of Appellants'
Petition was proper notwithstanding the existence of a
genuine issue of material fact as to whether an
illegal executive session was held by the [BLNR] in
deciding the Petition?
6. Did the Circuit Court err in granting summary judgment
on Appellants‘ claim that OCCL [Office of Conservation
and Coastal Lands] lacked authority to enforce the
CDUP conditions against Appellants where there was
clear undisputed evidence in the record that the OCCL
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was proceeding in an enforcement action against
Appellants?
7. Did the Circuit Court abuse its discretion in denying
Appellants' Motion to Compel when the discovery sought
by Appellants was discoverable and directly relevant
to the claims and defenses alleged by the parties, the
discovery could have had a material impact on the
merits of the claims that the Court dismissed by
summary judgment, and thus resulted in substantial
prejudice to Appellants?
8. Did the Circuit Court abuse its discretion in denying
Appellants' request for an HRCP Rule 56(f) continuance
to conduct discovery and granting summary judgment
where Appellees had refused to produce any records in
response to Appellants' pending discovery request,
Appellants had no opportunity to conduct discovery,
Appellants had filed a Motion to Compel, the discovery
sought to be compelled was highly relevant to the
claims and defenses alleged by the parties, and the
discovery could have had a material impact on the
merits of the claims that the Court dismissed by
summary judgment?
We vacate and remand the agency appeal for BLNR
determination on the Agency Plaintiffs' entitlement to a
contested case hearing under Hawaii Administrative Rule (HAR)
§ 13-1-29.1. Because we vacate and remand on this point, we
decline to address Appellants' other points.
I. BACKGROUND
Appellants own real property in the Haena Hui Partition
area on the island of Kadai. The real property is located
within a State of Hawai‘i land use Conservation District.
Appellants were granted CDUPs for single-family residences on
their properties. The CDUPs included a no-rental condition,
which prohibited renting out a single-family residence or using
it for any commercial purpose.
HAR § 13-5-42(a)(5) prohibits the use of single-family
residences for rental or commercial purposes without prior
approval from the BLNR.
Despite the prohibition on renting, some Appellants
rented their properties. On March 23, 2007, cease and desist
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letters were sent to Appellants.3 The letters indicated that the
OCCL4 had "received information regarding the alleged,
unauthorized vacation rental use of the subject property." The
letters further stated:
»The OCCL notes you will have until June 30, 2007 to cease
any unauthorized use on the subject parcel. Should you fail
to cease such illegal use by this date, you will be subject
to fines up to $2,000.00 per day, pursuant to Chapter 13-5,
HAR, in addition to administrative costs incurred by the
[DLNRJ.
The letters were signed by Peter T. Young, BLNR Chairperson.
The letters did not constitute formal enforcement
action against Appellants.
On September ll, 2007, Agency Plaintiffs filed a
Petition for Deviation from Conditions (Petition), pursuant to
HAR § 13-5-42(c), with the DLNR. The Petition requested "the
deletion of any language which purports to prohibit the owner of
a single family residence built pursuant to the CDUP from renting
the property.f The BLNR denied the Petition on December l4,
2007, and the DLNR notified Agency Plaintiffs of the denial by
letter dated December 18, 2007, Agency Plaintiffs timely
requested a contested case hearing on the denial.
on or about January 14, 2008, Thielen, the Chairperson
of the BLNR, wrote a letter to Agency Plaintiffs' counsel denying
Agency Plaintiffs' request for a hearing. The letter stated that
"[t]he request is denied because a contested case hearing on this
matter is not required by law." Thielen signed the letter in her
official capacity as the BLNR Chairperson. The BLNR did not
consider or act on Agency Plaintiffs' request,
on February l4, 2008, Agency Plaintiffs appealed to the
circuit court from the denial of their Petition and their request
for a contested case hearing, pursuant to HRS § 91-14 (l993 &
Supp. 2009).
3 The record indicates that each Appellant received a cease and desist
letter except for Guslander/Preston.
4 occL is an office within the DLNR.
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on March l2, 2008, Defendants filed their Motion to
Dismiss for Lack of Subject Matter Jurisdiction. Although the
Agency Plaintiffs opposed the motion, the circuit court granted
it and entered the Final Judgment on August 7, 2008.
Agency Plaintiffs timely appealed from the Final
Judgment to this court.
on April l4, 2008, Civil Plaintiffs filed a declaratory
judgment action against Defendants, asking for, among other
things, a declaration that Thielen's action in denying Civil
Plaintiffs' request for a contested case hearing "should be
reversed." on May 20, 2008, Defendants filed a motion to dismiss
the Complaint for Declaratory Judgment and Injunctive Relief,
owhich motion the circuit court ultimately denied.
on August ll, 2008, Defendants filed a Motion for
Summary Judgment as to all Claims and Parties. Civil Plaintiffs
opposed the motion, on November 17, 2008, the circuit court
granted Defendants' motion for summary judgment and entered the
Final Judgment.
Civil Plaintiffs timely appealed.
II. STANDARD OF REVIEW
"On secondary judicial review of an administrative
decision, HawaiF]i appellate courts apply the same standard
of review as that applied upon primary review by the circuit
court." Kaiser Fbund. Health Plan, Inc. v. Dep't of Labor &
Indus. Relations, 70 Haw. 72, 80, 762 P.2d 796, 800-01
(l988). 'For administrative appeals, the applicable standard
of review is set forth in [HRS] § 91-14 (2004), which
provides:
Upon review of the record the court may affirm the
decision of the agency or remand the case with
instructions for further proceedings; or it may
reverse or modify the decision and order if the
substantial rights of the petitioners may have been
prejudiced because the administrative findings,
conclusions, decisions, or orders are:
(1) In violation of constitutional or statutory
provisions; or
(2) In excess of the statutory authority or
jurisdiction of the agency; or
(3) Made upon unlawful procedure; or
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(4) Affected by other error of law; or
(5) Clearly erroneous in view of the reliable,
probative, and substantial evidence on the whole
record; or
(6) Arbitrary, capricious, or characterized by abuse
of discretion or clearly unwarranted exercise of
discretion. `
HRS § 91-14(g). Pursuant to HRS § 91-l4(g)(5),
administrative findings of fact are reviewed under the
clearly erroneous standard, which requires [the appellate]
court to sustain its findings "unless the court is left with
a firm and definite conviction that a mistake has been
made." Bumanglag v. Oahu Sugar Co., Ltd., 78 HawaFi 275,
279, 892 P.2d 468, 472 (1995) (block format and citation
omitted). Administrative conclusions of law, however, are
reviewed under the de novo standard inasmuch as they are
“not binding on an appellate court." Id. (block format and
citation omitted). "Where both mixed questions of fact and
law are presented, deference will be given to the agency's
expertise and experience in the particular field and the
court should not substitute its own judgment for that of the
agency " Dole Hawaii Div.~Castle & Cooke, Inc. v. Ramil, 71
Haw. 4l9, 424, 794 P.2d lll5, lll8 (l990). "To be granted
deference, however, the agency's decision must be consistent
with the legislative purpose." Camara v. Agsalud, 67 Haw.
2l2, 2l6, 685 P.2d 794, 797 (l984).
Peroutka v. Cronin, 117 HawaiU.323, 326, 179 P.3d 1050, 1053
(2008).
III. DISCUSSION
AAppellants contend that Thielen did not have the
authority to deny Agency Plaintiffs' request for a contested case
and the circuit court erred as a matter of law in failing to
address this error. Appellants argue that the BLNR had to decide
Agency Plaintiffs' request at a publicly noticed meeting.
Parties may request a contested case and petition BLNR
to hold a contested case hearing. HAR § 13-1-29(a) (1982). BLNR
has discretion to deny the request and/or petition:
The board without a hearing may deny a request or petition
or both for a contested case when it is clear as a matter of
law that the request concerns a subject that is not within
the adjudicatory jurisdiction of the board or when it is
clear as a matter of law that the petitioner does not have a
legal right, duty, or privilege entitling one to a contested
case proceeding.
HAR § 13-1-29.l.
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We note that the chairperson's enumerated duties under
HAR § 13-1-8 do not include officially determining a party's
entitlement to a contested case hearing. We also note that the
BLNR has the power to "[d]elegate to the chairperson or employees
of the department of land and natural resources, subject to the
board's control and responsibility, such powers and duties as may
be lawful or proper for the performance of the functions vested
in the board." HRS § 171-6(8) (Supp. 2007); see also HRS § 26-
15(a) (2009 Rep1.>.
on or about January 14, 2008, Thielen, as BLNR
Chairperson, wrote a letter denying Agency Plaintiffs' request
for a contested case hearing on the denial of their request for
deviation from the conditions in their CDUPs "because a contested
case hearing on this matter is not required by law." In
conducting discovery, Appellants found no indication that BLNR
delegated to Thielen the authority to deny requests for contested
case hearings. In their motion for summary judgment, Defendants
conceded that "[t]he Board did not consider or act upon [Agency
Plaintiffs'] request for a contested case hearing." In granting
Defendants' motion for summary judgment, the circuit court did
not make any finding or conclusion as to the propriety of
Thielen's denial letter.
Given the foregoing law and facts, we conclude that
without proper delegation from BLNR, Thielen could not lawfully
deny Agency Plaintiffs' request for a contested case hearing. In
granting Defendants' motions to dismiss the agency appeal and for
summary judgment in the declaratory judgment action, the circuit
court accordingly erred by failing to address the propriety of
Thielen's denial letter.
IV. CONCLUSION
We vacate the Final Judgment filed on August 7, 2008 in
Civil No. 08-1-0030 in the Circuit Court of the Fifth Circuit and
remand the agency action for a BLNR determination on Agency
Plaintiffs' entitlement to a contested case hearing under HAR
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§ 13-1-29.l. The circuit court's November 17, 2008 Final
Judgment in Civil No, 08-1-O077 in the Circuit Court of the Fifth
Circuit as to Civil Plaintiffs' declaratory judgment action is
vacated, and this case is remanded to the circuit court for
further proceedings consistent with this opinion.
DATED; Honoluiu, Hawai‘i, June 23, 20i0.
on the briefs:
Roy A. Vitousek III
Kristin S. Shigemura § §§ ‘
(Cades Schutte LLLP)
for Appellants. Chief Judge
Deirdre Marie-Iha,
Deputy Solicitor General, ~//
for Appellees. _ 6EP
Associate Judge
d,,,,..,,@» “
Associate Judge
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