County denies $264M claim
to 150 Hokulia lot owners

HILO » Hawaii County has refused to pay a claim of more than $264 million to about 150 owners of lots in the controversial Kona residential project Hokulia, saying no valid reasons were given by the owners' attorneys.

The refusal to pay the money sought in an administrative claim means California attorneys Robert Baker and Rollin Chippey II might file one or more lawsuits in Hawaii to collect the money.

Hokulia is a 1,550-acre project with 730 1-acre home sites, a golf course and other features which was being developed by 1250 Oceanside Partners until 2003 when halted by a Circuit Court ruling.

Judge Ronald Ibarra ruled that the project is an urban use being illegally constructed in an agriculturally designated district.

An Aug. 2 letter from county attorney Joseph Kamelamela to the attorneys gives several reasons why Kamelamela believes lot-owner lawsuits will fail.

Although Ibarra's final ruling was in 2004, he made a preliminary ruling in 2002. Kamelamela's letter says that first ruling started the clock ticking, and the time for lot-owner lawsuits permitted by the statue of limitations has run out.

A major issue is the development agreement between the county and Oceanside, a contract that says the county must provide various forms of assistance to the developer.

Attorneys Baker and Chippey say the county broke the agreement by not granting building permits to lot owners. Kamelamela countered that Ibarra forbade the county to issue permits.

The lot-owner attorneys also said the ruling against the project was the result of the county's failure to properly enforce the state law regarding land use.

Kamelamela countered that the development agreement placed the responsibility on Oceanside to obey the state law.

As to the amount of money owed to lot owners, revised slightly downward since mid-July, Kamelamela called the amount "too speculative" and said there might be no damage at all to lot owners if pending appeals by Oceanside and the county result in the state Supreme Court overturning Ibarra's ruling.

Kamelamela also notes that the California attorneys are not licensed to practice law in Hawaii and could be barred from filing suits here.