The Hawaii Supreme Court on Wednesday heard oral
arguments in a breach-of-trust lawsuit against the state Department of Hawaiian Home Lands that has dragged on for 20 years.
But as with all other phases of the complex class-action case, the
2,700 plaintiffs will have to wait indefinitely before they learn what happens next.
On the 60th anniversary
of Hawaii statehood, the justices listened to arguments from attorneys for both sides and peppered them with questions before taking the case under advisement. They didn’t indicate when a decision would be made.
The high court will decide whether to uphold key elements of a lower court ruling that found the department
liable for damages for breaching a trust agreement by not providing homesteads to eligible Native
Hawaiians on a timely basis. DHHL beneficiaries must be at least 50% Hawaiian.
The lawsuit, filed in 1999, has dragged on for so long that an estimated 300 to
400 plaintiffs have died,
even as the wait list for DHHL homesteads has swelled to about 28,000 beneficiaries.
The lower court ruled a
decade ago that the state breached the trust agreement — a fiduciary obligation it assumed as a condition of statehood — and was liable for damages.
“The case presents an opportunity for the court to say, ‘Time’s up, no more waiting,” Carl Varady, one of two plaintiff attorneys, told the justices.
Clyde Wadsworth, solicitor general for Hawaii, asked the justices to overturn the Circuit Court order, citing what he said were multiple errors.
Among the flaws, according to Wadsworth, were holding the state liable for damages due hundreds of claimants who never had
viable claims and for crafting a damages-calculation model that was contrary
to state law.
“We must, we must,
we must comply with the statutory language,” he said.
The justices questioned Wadsworth about several
aspects of the state’s case,
including its position that
the state should not be liable for delays caused by a claimant’s failure to participate
in a homestead offering – even if the failure was due
to the plaintiff being unable able to qualify for a home loan.
But Associate Justice Richard Pollack said being unable to qualify financially was not a failure to participate given that the state only makes a limited number of lots available and specifies the financial criteria for qualifying.
“It seems like by setting the financial qualifications, they (state officials) determine who’s going to be an appropriate claimant,” he said.
If a claimant is unable to qualify, however, the state shouldn’t be liable for damages beyond that point because that part of the delay would be not be caused by the state’s breach, Wadsworth argued.
“It’s not like we’re trying to take advantage of poor folks,” he told the justices.
Varady said imposing financial qualifications “cycles back to 60 years of mismanagement and underfunding
of the trust asset. That’s the only reason it exists. Had
the trust been properly
managed, there would be no waiting list, there would be sufficient resources and there would be no argument that lack of financial wherewithal would disqualify anyone.”
The justices also grilled Wadsworth on the state’s position that the plaintiffs must provide evidence of how much they paid for housing on non-homestead lands potentially going back decades.
“They would have to remember what they paid in 1967,” Chief Justice Mark Recktenwald said. “I don’t remember what I paid in 1967.
I couldn’t even come close to guessing.”
But Wadsworth said that although receipts and other documentation represented the best evidence, plaintiffs could testify about their past housing expenses or show what the going rent was for the areas where they lived at the time.
Kauai resident Liberta
Albao, 75, one of the plaintiffs who attended the hearing, told the Honolulu Star-
Advertiser that the state’s
arguments were nothing but excuses and implored the defendants to settle the case.
Otherwise, she said,
Hawaiians will continue to rise up and speak out against injustices.
“That’s why you have Mauna Kea,” she said, referring to the protest on the Hawaii island mountain that has blocked construction of the Thirty Meter Telescope for weeks.
If the justices decide in
the plaintiffs’ favor, the next phase of the case – determining actual damages – would switch to an administrative process overseen by a
special master.
