Owners will fight
to keep land despite
court ruling

U.S. Supreme Court
ruling clears the way for
leasehold conversion

By Gordon Y.K. Pang
Star-Bulletin

Property owners are vowing to continue the fight against the city's mandatory leasehold condominium conversion law despite a U.S. Supreme Court ruling that clears the way for the city to force them to sell their fee interests.

"I cannot believe our justice system could dare to do this to us," said Phyllis Zerbe of the Small Landowners Association about yesterday's decision.

"Whether it's legal or not, it's wrong," Zerbe said. "It's wrong to take someone's private property and transfer those rights to someone else under the guise of public purpose."

Zerbe's organization, which claims to represent 400 to 500 landowners, had filed suit challenging the legality of the city's lease-to-fee conversion law.

Kekoa Paulsen of Kamehameha Schools/Bishop Estate, the state's largest private landowner, said he expects the trust to challenge the rule on an applied basis.

"We certainly will do that in instances where it's a naked taking of trust assets," Paulsen.

The Small Landowners Association is apparently prepared to do the same although Zerbe was vague yesterday.

"We're going to do something," she said. "We are not just going to stand there and let somebody take property away from us."

Bob Voege of the Hawaii Leaseholders Equity Coalition said the Supreme Court simply confirmed those in leasehold condominiums are due the same rights as those in leasehold single-family homes.

Voege noted that the condo ordinance was patterned after a 1967 state law that allowed single-family homeowners to buy their leased land from the landowners. That law, intended to break up the concentration of private land ownership in Hawaii, was upheld by the Supreme Court in 1984.

"Now those of us who live vertically have the same right," he said.

Voege added that a large landowner like Bishop Estate stands to make millions in the sale of the fee interests.

City Councilman Jon Yoshimura, who heads the Council's Policy Committee, said the ruling came as no surprise following the 9th U.S. Circuit Court of Appeal's decision to uphold the city ordinance last year.

"The decision speaks for itself," Yoshimura said. "This is a condemnation, a constitutionally valid taking for which there must be just compensation."

Chris Parsons, the city's deputy corporation counsel, said: "We hope the leasehold conversion program can now go forward without further delay."