A recent decision of the Intermediate Court of Appeals has not settled the law on ownership of accreted shore land in Hawai`i, but has rather set in motion heated debate on exactly what the court’s decision means.
By January 11, less than two weeks of the court’s release of the decision (December 30), the state of Hawai`i was asking for clarification and the private parties who brought the original lawsuit were seeking reconsideration.
Ironically, vagueness over the meaning of a lower court ruling was the very thing that caused the initial appeal to the ICA.
Given the high stakes at the heart of the matter – nothing less than the state’s claimed right to own, and the public’s right to enjoy, beach property that has accreted in front of private land – the vigorous pursuit of clarity is hardly surprising.
A ‘Public Trust Mandate’…
In 2003, the state Legislature passed and the governor signed a bill that became known as Act 73. This law denied private property owners the right to claim as their own any land that had accreted between their seaward boundary and the high-water mark. Eighteen years earlier, the state had, through Act 221, limited beachfront property owners’ rights to accreted land by stating that before any such land could be formally claimed, landowners would have to demonstrate that the accretion was “permanent,” which, under Act 221, meant that it had to have been present at least 20 years.
In 2005, several owners of property on Portlock Road in East O`ahu, fronting Maunalua Bay, challenged Act 73, stating that it amounted to an unconstitutional “taking” and asking the court for injunctive relief, which would have effectively required the state to continue processing any applications to register title to accreted lands.
Judge Eden Hifo of the First Circuit Court agreed with the property owners in a preliminary ruling that Act 73 “represented a sudden change in the common law and effected an uncompensated taking of, and injury to, (a) littoral owners’ accreted land, and (b) littoral owners’ right to ownership of future accreted land.” In her order of May 3, 2006, however, she did not provide the injunctive relief sought.
Hifo also stated that Act 221 “did not alter the common law of Hawai`i with respect to the ownership of accreted land,” which, she continued, “belongs to the littoral landowner,” whether or not the landowner had registered title to it.
Essentially, Hifo left it to the state to decide whether to enforce the law (and compensate landowners for their losses) or simply walk away from Act 73.
Thereafter the state, with the concurrence of the private landowners, filed its interlocutory appeal, which sought clarification on the central question of whether Act 73 did, indeed, amount to a taking.
A key part of the state’s argument is the classification of accreted lands into three classes: those existing before Act 221; those existing from 1985 (when Act 221 was passed) to May 19, 2003 (when Act 73 took effect); and those that might come into existence after that date. Lands in the first class were not affected by either Act 221 or Act 73, the state noted. In addition, there was no taking involved in Act 73, the state argued, since under Act 221, logically, with accreted lands required to be present at least 20 years, no accreted lands could have come into being in the 18 years between passage of Act 221 and Act 73. With no such lands in existence, the idea that owners of adjoining lands could have suffered a taking was not legally defensible, the state argued. “Act 73 did not take away any existing right or ability of littoral landowners to utilize, or otherwise control or assert dominion over, Class II accretions,” the state argued in its appeal. “It merely took away their hope that sometime in the future they might have control over those accretions if and when the accretions stayed in existence for 20 years.”
As for the third category of accreted land – that which occurred after May 19, 2003 – the state had every right to deny adjoining landowners the right to claim that as their private property, the state argued. Act 73 had no effect on the landowners’ main parcel of land, the state argued, but only interfered with the littoral landowners’ “hope of future control” over accretions. The fact that such hope was dashed “cannot amount to a direct appropriation of property rights,” the state said in its appeal.
In addition, the state noted, the plaintiffs in the case “did not even purchase their beachfront land before the passage of Act 73,” so “they could not have had any [investment-backed] expectations as to ever using” accreted lands.
In any event, the state’s argument went, the public’s interest in using these lands was enshrined in the “public trust constitutional mandate of Article XI, Section 1” of the Hawai`i Constitution, which says that “all public natural resources are held in trust by the state for the benefit of the people.”
… Or a Common Law Right
The landowners’ position, as set forth by attorneys Paul Alston and Laura Couch, is that common law protects the rights of littoral property owners to claim accreted shore lands.
Act 73 took away those rights, they argued, by fixing the seaward boundary “of virtually every oceanfront parcel … as of May 19, 2003.” Judge Hifo’s ruling, the plaintiffs said, requires the state to pay for this taking and, until it does, the state is enjoined from enforcing Act 73.
“No one in this action is suggesting that the state should not increase the size of public beaches by expanding them into areas mauka of the shoreline,” the plaintiffs wrote in their brief to the ICA. “Large public beaches are wonderful; they bring much happiness to Hawai`i’s citizens and tourists, alike. However, private landowners are under no obligation to donate their private property for the cause. If the state wishes to increase the width of public beaches it can surely do so, but not without compensating private landowners.”
“Hawai`i common law has always recognized littoral landowners’ vested rights to accretion above the high water mark… Act 73, in contrast, said all existing and future accretion was (and would forever be) state land. By doing this without paying compensation to the littoral owners, the state went too far,” the plaintiffs claimed.
Contrary to what the state had argued, Hawai`i law never required littoral landowners to formalize their ownership of accreted lands; “Instead, the ‘high water mark’ has always been the controlling boundary,” the plaintiffs argued in their reply to the state’s appeal.
As to the state’s argument that the claimed losses are only potential and speculative, that is “way off the mark,” the plaintiffs’ attorneys write. “The rights lost by Act 73 are not a mere possibility; in effect, Act 73 rewrites all littoral owners’ deeds so their shorefront boundaries are not ma ke kai [along the water] (or its equivalent) but fixed lines. The accretion rights lost are present and immediate whether the accretion is existing (and previously unrecorded) or may occur some day in the future.”
The state had pointed out that littoral owners would not lose their access to the water since, as members of the public, they, too, would have every right to cross accreted lands to get to the beach. But the plaintiffs’ attorneys put a different spin on this: “The right to ‘future’ accretion is a key component of Appellees’ property rights because it ensures littoral landowners they will remain littoral landowners… It is no mystery why property along the beach is usually the most expensive on the market; it is adjacent to the shoreline. Property which is near the beach but interrupted by a park, public restroom, lifeguard station or shower is not as valuable as land directly on the shoreline.”
Filing amicus briefs with the ICA were the Pacific Legal Foundation, represented by Robert H. Thomas, advocating for private property rights, and Hawai`i’s Thousand Friends, represented by Carl Christensen, which suggested that the court was free to determine that the landowners had no vested right to future land accretions.
The ICA Opinion
“It is true that under Hawai`i common law, land accreted to oceanfront property belongs to the oceanfront property owner,” the Intermediate Court of Appeals found. However, it continued, the very first chapter of Hawai`i Revised Statutes gives the Legislature and the courts the power to override common law. It goes on to note that the Hawai`i Supreme Court has upheld the power of the Legislature to “change or entirely abrogate common law rules,” although in so doing, it “may not violate a constitutional provision.”
So what of the plaintiffs’ claims to have a constitutionally protected private property right to accreted lands?
On this question, the ICA seems to have divided its consideration into two parts: the issue with respect to existing accretions, and that with respect to future accretions.
With respect to future accretions, the ICA seemed to agree with the state: “Any claims that plaintiffs may have to future accretions are purely speculative,” the ICA wrote. “Plaintiffs have no vested right to future accretions that may never materialize and, therefore, Act 73 did not effectuate a taking of future accretions without just compensation.”
(It disagreed with the state, however, over the effect of Act 221 – the 1985 law – on landowners’ rights to accreted land. While the act set forth standards for registering title to accreted lands, the ICA noted, it “did not change the Supreme Court’s precedent that accreted land above the high-water mark belongs to the littoral owner of the land to which the accretion attached. Act 221 also did not provide that all accreted land above the high-water mark was public or state land until the littoral owner proves that the accretion was natural and permanent.”)
With respect to existing accretions, the ICA determined, “Act 73 permanently divested a littoral owner of his or her ownership rights to any existing accretions to oceanfront property that were unregistered or unrecorded as of the effective date of Act 73… and, therefore, Act 73 effectuated a taking of such accretions.”
The ICA remanded the case back to Hifo, with instructions that she determine whether the plaintiffs have existing accreted lands and, if so, to assess the damages they incurred as a result of Act 73.
In its motion for clarification, the state asked the ICA to affirm the state’s position that the takings effected by Act 73 apply only to what the state called Class II accreted land (that which accreted between June 4, 1985 and May 19, 2003).
In the plaintiffs’ motion for reconsideration, the court is asked to look at the case in light of a fresh-off-the-press ruling from the 9th U.S. Circuit Court of Appeals. This new, “previously uncited, Ninth Circuit Case law both undermines the cases underpinning the [ICA] opinion and supports [plaintiffs’] argument that ‘boundary fixing’ cases are constitutionally distinct from cases, such as those cited in the opinion, in which the interference with future accretion involves the government exercising its rights as owner of submerged lands,” the plaintiffs’ attorneys write.
They also dispute the court’s findings that the public trust doctrine as well as HRS 1-1 can diminish littoral owners’ rights to future accretions; the court’s finding that nothing in the record shows the plaintiffs had existing accreted lands; and the court’s comments on the propriety of Judge Hifo’s decision to accept the case as a class-action lawsuit.
On January 20, the ICA denied both motions.