More than ten years ago, the state Land Use Commission ordered Bridge \u2018Aina Le\u2018a to explain why it had not begun work to develop more than 1,000 acres of land in South Kohala that had been put into the Urban land use district back more than two decades earlier, in January 1989. <\/p>\n\n\n\n
That order-to-show-cause (OSC) vote launched a series of events that has yet to reach its conclusion. A case before the 9th U.S. Circuit Court of Appeals almost certainly will not move the process toward development of the land any further down that road, but, however it is decided, it will mark an important milestone in the seemingly interminable history of litigation and legal issues surrounding efforts to build out a town of more than 2,000 homes with a commercial center, school, golf course, and other amenities. <\/p>\n\n\n\n
Bridge \u2018Aina Le\u2018a sued the state over\nthat vote and the subsequent decision of\nthe LUC, in 2011, to revert the Urban land\nback to the Ag district. The company alleged\nthe votes had violated its constitutional\nrights to due process and equal protection\nand claimed that the action amounted to\nan unconstitutional taking of its property.\nThat lawsuit eventually reached the Hawai\u2018i\nSupreme Court, which, in November 2014,\nfound that the LUC had not complied with\nits own rules when it voted in 2011 to revert\nthe land to the state Agricultural district.\nIt did not, however, uphold Bridge\u2019s claim\nthat its constitutional rights had been\nviolated.\n<\/p>\n\n\n\n
As the state case made its way up to the Hawai\u2018i Supreme Court, Bridge was also seeking to recover the economic damages it claimed the LUC vote had caused it. That case was being heard in federal court. During the pendency of the state litigation, the federal case was on hold. <\/p>\n\n\n\n
After the Hawai\u2018i Supreme Court made its ruling, the federal case was taken up once more, with Bridge \u2018Aina Le\u2018a seeking around $50 million in damages from the state. <\/p>\n\n\n\n
Settlement talks proved productive. In mid-2016, the state attorney general\u2019s office and lawyers for Bridge reaching an agreement that provided for the state to pay Bridge $1 million and the case being dropped. By this time, Bridge had sold or had an option to sell most of the Urban district land to another company, DW \u2018Aina Le\u2018a, LLC, that ultimately would take over development plans. <\/p>\n\n\n\n
While the settlement amount fell short of what Bridge was demanding, Bridge still was suffering no loss on the real estate deals it had made. In 1999, it had purchased 3,000 acres (the parcel with 1,060 acres in Urban and 30 in Ag, and another 1,900 acres in Ag that surrounded the mostly Urban land on three sides) for just $5.2 million, after several previous owners had been unable to move forward with the urban development proposed to the LUC back in 1987. In March 2009, it sold off a 61-acre parcel of Urban land to DW \u2018Aina Le\u2018a, Inc., for $5 million and gave DW \u2018Aina Le\u2018a an option to purchase the remainder of the Urban land. <\/p>\n\n\n\n
From 2009 to 2015, Bridge sold off all but a 27-acre lot of the Urban land, zoned Commercial, to \u2018Aina Le\u2018a, for total purchase price of around $32 million. <\/p>\n\n\n\n
In its brief to the appeals court of January\n30, the state takes note of the gains made\nby Bridge: \u201cBridge bought the entire 3,000\nacres for $5.2 million and received from DW\nfor the sale of the property $18 million in\ncash and a secured $14 million note, much\nof which was received after the reversion.\nThere can be little doubt that, even taking\ninto account the approximately $3 million\nBridge spent working on the property,\nBridge made a profit.\u201d\n<\/p>\n\n\n\n
A $1 <\/em><\/strong>Award By the time the jury heard the case, in\nMarch 2018, several pretrial motions had\nbeen heard to limit the scope of testimony\nand evidence that could be presented.\n<\/p>\n\n\n\n Critically to Bridge \u2018Aina Le\u2018a\u2019s case, the presiding judge, Susan Oki Mollway, had granted the state\u2019s motion to dismiss the report of Bridge \u2018Aina Le\u2018a\u2019s accountant. The accountant, David Burger, stated that in the five-year period that the reversion was being litigated, Bridge had earned an average of 10.12 percent a year on its capital investments. Separately, Bridge\u2019s appraiser, Steven Chee, reported that the LUC\u2019s vote in 2009 to revert the property reduced its value by $34 million. By multiplying the $34 million by the return on investment and the period \u2013 5.68 years \u2013 that the devaluation lasted, Bridge\u2019s experts calculated the company\u2019s losses as a result of LUC action at $19,543,744. <\/p>\n\n\n\n The state objected to the Burger and\nChee statements. Burger\u2019s statement did\nnot meet the court\u2019s standards for expert\ntestimony. And without Burger\u2019s report,\nChee\u2019s lacked any effect.\n<\/p>\n\n\n\n Bridge attempted to supplement Burger\u2019s statement with additional information, but the time for submission of evidence had passed. <\/p>\n\n\n\n The jury heard the case, but was not able\nto hear any evidence supporting Bridge\u2019s\nclaim of damages. When the verdict was\nreturned, the jury had found that Bridge had\nsuffered damages, but Judge Mollway had\nnot allowed them to determine just what\nthose damages should be. Instead, having\ndisallowed Bridge\u2019s reports supporting its\ndamage claims, Mollway granted nominal\ndamages of $1.\n<\/p>\n\n\n\n By not allowing the jury to hear the damage evidence, Bridge says, \u201cthe district usurped the role of the jury which \u2013 having found that a taking occurred \u2013 should have been permitted to determine which expert\u2019s testimony to credit and which rate of return to apply.\u201d <\/p>\n\n\n\n Appeals\n<\/p>\n\n\n\n In its October 31, 2018, brief to the 9th Circuit, Bridge says that the Mollway\u2019s ruling to exclude evidence of the company\u2019s losses \u201cform the centerpiece of this appeal.\u201d <\/p>\n\n\n\n \u201cThe district court placed more importance on the \u2018teeth\u2019 that the federal rule [on evidence] than on Bridge\u2019s right, mandated by the U.S. and Hawai\u2018i constitutions, to receive an adequate award of just compensation,\u201d the brief from Bridge attorneys Bruce D. Voss, Matthew C. Shannon, and John D. Ferry III states. <\/p>\n\n\n\n What\u2019s more, Bridge also is asking the appellate court to overturn the decision of Mollway to grant immunity to the individual commissioners on the LUC who voted in favor of the reversion. And it appeals the lower court\u2019s decision to dismiss its claim that its constitutional rights to equal protection were violated, for which it also sought damages. <\/p>\n\n\n\n The state has also appealed the lower\ncourt decision to deny several of its motions\nhaving to do with assessing damages.\n<\/p>\n\n\n\n The appeals court has not yet set a date\nfor hearing arguments on the case.\n<\/p>\n\n\n\n \u2014Patricia Tummons <\/strong><\/p>\n","protected":false},"excerpt":{"rendered":" More than ten years ago, the state Land Use Commission ordered Bridge ‘Aina Le‘a to explain why it had not begun work to develop more than 1,000 acres of land in South Kohala that had been put into the Urban … Continued<\/a><\/p>\n","protected":false},"author":1,"featured_media":8842,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[451],"tags":[7],"class_list":["post-11057","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-march-2019","tag-patricia-tummons"],"_links":{"self":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts\/11057","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=11057"}],"version-history":[{"count":0,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts\/11057\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/media\/8842"}],"wp:attachment":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=11057"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=11057"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=11057"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
Ignoring the advice of the state attorney general, the 2017 Legislature did not approve the settlement and litigation resumed in federal district court in Honolulu. <\/p>\n\n\n\n