Last October, U.S. District Judge Jill A. Otake granted a motion by the City & County of Honolulu and its Department of Planning and Permitting for summary judgment on a complaint brought in May 2023 by companies owned by the developer of the Marconi Point Condominiums project.
The companies argued that the city had violated their rights because it had given assurances years ago that development there — which sits entirely within the city’s Special Management Area — would not require a Special Management Area permit, then later reversed its position.
The city and the DPP, however, have countered that 1) the agency never gave the official assurances the companies claimed it did, and 2) it always maintained the authority to exercise its discretion to require an SMA permit review.
The companies, all owned by developer Jeremiah Henderson III, appealed to the 9th U.S. Circuit Court of Appeals. They argued in their March 30 opening brief that the DPP had abused its discretion by relying on “speculative future development,” and that the court had erred when it found that the agricultural subdivision permit filed by Makai Ranch, one of Henderson’s companies, had not been automatically approved.
In its April 29 answering brief, counsel for the city argued that the appeal “addresses a critical question: whether Makai Ranch can use litigation to bypass the environmental review and public participation required before coastal development may proceed under the Hawaiʻi Coastal Zone Management Act. The answer is no. Environmental review must occur before development can be permitted in sensitive environmental areas.
“Makai Ranch owns property within [the SMA]. Makai Ranch’s property is registered as a ‘historic district’ on the National Register of Historic Places, and it contains historic buildings that the CZMA is intended to protect. Portions of the property lie within the state ‘conservation’ zoning district, and the property contains a conservation easement. The property is located in an environmentally sensitive area, and development on the property requires rigorous review.”
In their May 20 reply to the city’s brief, Makai Ranch’s attorneys argue that the case is not about discretionary land-use judgment, but is about the statutory limits on an agency’s discretion. “The legislature imposed deadlines, defined exemptions, and required agencies to make decisions based on the project before them. DPP did none of those things,” they wrote.
Solar Flare-Up
RCA Trade Center, Inc. and MP Unit 21, LLC — both Henderson companies — last year sued in federal court companies involved in the installation of solar PV panels on eight large agricultural warehouses at the Marconi Point Condominiums project.
RCA and MP Unit 21 own the condominium units upon which the warehouses sit, as well as the warehouses themselves. Years ago, they entered into leases with Hawaii FIT Sixteen, LLC, and Hawaii FIT Seventeen, LLC, which had planned to install a large rooftop PV system that would export electricity to Hawaiian Electric Company under its feed-in-tariff program.
RCA and MP Unit 21 alleged the solar companies and their contractors damaged the warehouse rooftops, causing them to leak. In their countersuit filed in January, the solar companies argued that their landlords had failed to disclose that the warehouses were built with faulty materials.
On March 20, RCA and MP Unit 21 filed complaints in 1st Circuit Court
against Hawaii FIT Sixteen and Seventeen, arguing that the latter companies failed to comply with their leases. RCA and MP Unit 21 are seeking judgments giving them possession of the rooftops.
In April, the solar companies filed notices seeking to remove the March complaints to federal court. Then on May 5, RCA and MP Unit 21 filed a motion to remand the case to state court. Henderson stated in a declaration accompanying the motion that the rooftops “have experienced persistent and widespread leaks affecting all of the warehouses.”
Since last October, RCA and MP Unit 21 have been trying to sell the warehouses for $14 million.
Briefs on the motion are due this month. U.S. District Judge Otake will decide after reviewing the briefs whether a hearing should be held.
— Teresa Dawson