After five years of drawn-out litigation, the state has reached a proposed settlement agreement with Denise and James O’Shea, who were accused of building an illegal seawall along Sunset Beach on Oahu’s famed North Shore.

The O’Sheas will have about two years to remove the wall, which coastal experts say has been harming the beach, and all fines essentially will be waived, according to the agreement, which still needs to be approved by the Board of Land and Natural Resources. While the O’Sheas could have faced penalties of $15,000 a day for the seawall, the agreement knocks down an initial fine of $77,500 to $52,500. Under the terms, the O’Sheas will be allowed to credit the fine to the costs of tearing down the wall.

The terms also specify that the settlement agreement runs with the property and that if the seawall is not removed by Dec. 31, 2024, the state may immediately remove the wall itself and charge the O’Sheas or any future owner for the work. The owner at the time also could face fines for not complying with the order.

The four-bedroom, two-bath house at 59-171-D Ke Nui Road has been up for sale for close to $2 million for six months, according to a real estate listing that touts the oceanfront property’s view of “six iconic surf breaks and year-round sunsets.”

The Land Board is scheduled to review and vote on the settlement agreement during its Friday board meeting.

Denise O’Shea said she didn’t want to comment on the case.

The enforcement action against the O’Sheas was brought in 2017 by the Department of Land and Natural Resources’ Office of Conservation and Coastal Lands, which is charged with protecting the state’s natural resources and public beaches. In OCCL’s submittal to the Land Board on the case this month, coastal officials say that the seawall is exacerbating beach erosion, blocking public access along the shoreline and creating unsafe conditions as lifeguards can’t patrol the stretch of coastline.

OCCL said it’s confident that the state would prevail in the court case if it went to trial, but that it’s recommending the case be settled in order to speed up the removal of the seawall “for the sake of the sandy beach which the state has a public trust duty to protect for future generations.”

OCCL says that the O’Sheas would almost certainly appeal a court decision in favor of the state and would likely obtain a stay, pausing enforcement of the judgment.

“Thus, even assuming that the state prevails on appeal, it would likely be several years before OCCL could enforce a judgment ordering that the wall be removed,” OCCL wrote. “While this case is on appeal, the new seawall will continue to damage public trust lands.”

Coastal scientists have long warned that seawalls cause beach loss. Oahu has lost about one-quarter of its beaches to seawalls, and scientists have cautioned that by midcentury the island might have just a handful of healthy beaches if more isn’t done to protect the public coastlines.

OCCL, in its submittal to the Land Board, stressed that Oahu’s North Shore beaches are “among some of the most valuable natural resources in the state” and “are an essential economic engine for the North Shore community.”

The O’Sheas purchased their Sunset Beach property in 2001, according to DLNR. At the time, an old seawall built on the public shoreline fronted the property. The state says it’s not clear whether the seawall had been built illegally or if it was grandfathered in, as the specific date of construction is unknown. But grandfathered seawalls can’t be repaired if they are significantly damaged, and in 2017 the wall collapsed. The state says the O’Sheas then built a separate wall from the one that collapsed, remnants of which remain strewn along the beach.

The massive new wall, made of boulders and concrete, is 15 feet tall, 46 feet long and 8 feet thick at the base, tapering to about 2 feet thick at the top, according to DLNR.

The O’Sheas’ seawall case made headlines in 2017, in part because the wall was built along one of Hawaii’s most treasured beaches. During a heated Land Board meeting in 2017, Sam Lemmo, OCCL’s former administrator, sought to order the O’Sheas to remove the wall and pay a fine of $77,500, plus $15,000 for every day they failed to comply with the order.

“We have essentially a seawall that was completely rebuilt, and it was done without any sort of permit from any government entity, any approval, any consent, on one of the most spectacular beaches on the planet,” Lemmo told the Land Board at the time.

But before the hearing was over, the O’Sheas had requested a contested case, an administrative appeals process. The hearing never happened, as the state took the issue to court, seeking an order to have the O’Sheas remove the seawall.

In September 2018 the O’Sheas filed a counterclaim against the state alleging that the state had built the seawall fronting the property in the 1950s and then failed to maintain it, contributing to its collapse and damage to their property.

The state “allowed the seawall to deteriorate, jeopardizing the O’Sheas lives, home and property,” according to the counterclaim, filed by the O’Sheas’ attorney Gregory Kugle. The counterclaim sought unspecified compensation and damages relating to the collapse of the old seawall, including the depreciation of the property’s value. The O’Sheas also asked the court to order the state to repair and maintain the seawall. The counterclaim doesn’t make clear whether the O’Sheas sought to have the state rebuild the collapsed wall in front of their home or maintain the new 15-foot wall that they built.