Hawaii Ct App Upholds Attorneys Fees And Costs For Eminent Domain Appeals

by Robert Thomas, InverseCondemnation.com

As we predicted in our oral argument preview, the Hawaii Intermediate Court of Appeals made short work of the issues in City & County of Honolulu v. Sherman, No. 28945 (Dec. 27, 2011). Just two weeks after oral argument, the court issued its opinion (unpublished; again, not a surprise).

The court concluded that the "chapter 38" takings were correctly dismissed, and (in the more interesting part of the opinion), that the trial court should have considered and awarded the property owner the attorneys fees and costs it sustained as a result of an earlier appeal which did not result in an outright landowner victory, but merely a remand for further consideration. On remand, the trial court dismissed the eminent domain case.

The ICA relied on County of Hawaii v. C&J Coupe Family Ltd. P'ship, 120 Haw. 400, 208 P.3d 713 (2009), which held that if an eminent domain action is dismissed or otherwise fails, the property owner is entitled under Haw. Rev. Stat. § 101-27 to recover the damages (attorneys fees and costs) it incurs in the case, including those is sustains on appeal. Under Coupe, the ICA correctly rejected the City's arguments that (1) the property owner was not entitled to damages because it did not prevail in the first appeal, (2) it missed the deadline to recover its fees and costs, and (3) the trial court did not have jurisdiction to consider fees and costs incurred in an appellate court.

Here are your "how do you seek fees and costs in a Hawaii eminent domain case" talking points:

• The 101-27 damage issue does not become ripe until it is determined the property will not or cannot be taken. A property owner has no obligation to apply to recover its fees and costs until then.

• Under Coupe, if a taking ultimately fails or is dropped by the government, the property owner is entitled to recover everything under section 101-27, even if it did not prevail at every stage of the case, including intermediate or interlocutory appeals. What matters is whether the property is "finally taken." If it isn't, the property owner recovers.

• All courts have jurisdiction to award section 101-27 damages if a taking fails. By way of illustration, here's what should happen next in Sherman: (1) the trial court on remand should award the property owner damages for all fees and costs it incurred from the time of filing the complaint up through the trial court's most recent determination that the property could not be taken, including the damages sustained by virtue of the first appeal; and (2) the ICA has jurisdiction to award section 101-27 damages for fees and costs incurred in the latest appeal under Rule 39 of the Rules of Appellate Procedure.

Here are your oral argument talking points:

• Arguments that a court has the equitable power to ignore the plain language of a condemnation statute or ordinance, that a local government has the equitable power to condemn property, or that the city council's determination whether to take property is merely a "rubber stamp" of a city agency, are not likely to succeed.

• Even if you have little or nothing to say at appellate oral arguments, at least you need to show up. For whatever reason, the City's attorneys did not make an appearance at the oral argument and apparently did not tell the court, prompting the Chief Judge to ask "anyone know where the City is?" Ouch.

City and County of Honolulu v. Sherman, No. 28945 (Haw. Ct. App. Dec. 27, 2011)