1. Public Access Shoreline Hawai‘i
2. Jerry Rothstein, Public Access Shoreline Hawai‘i Coordinator
3. Angel Pilago

1. Skip Spaulding, Honolulu, HI
2. Arnold L. Lum, San Francisco, CA
3. Denise E. Antolini, San Francisco, CA
4. Eric S. Walters, San Francisco, CA
5. Lea O. Hong, Sierra Club Legal Defense Fund

1. Hawai‘i County Planning Commission
2. Fred Y. Fujimoto, Hawai‘i County Planning Commission Chairman
3. Nansay Hawai‘i, Inc.

1. Roy Arnold Vitousek, III, Honolulu, HI
2. J. Robert Arnett, II, Cades Schutte Fleming and Wright, Honolulu, HI
3. Nani Lee, Cades Schutte Fleming and Wright, Honolulu, HI
4. John P. Powell, Cades Schutte Fleming and Wright, Honolulu, HI
5. Joseph Kalani Kamelamela, Deputy Corp. Counsel, Hilo, HI
6. Michael J. Matsukawa, Hilo, HI

Supreme Court of Hawai‘i

N/A

N/A

• Coastal Zone Management Act (“CZMA”) Hawai‘i Revised Statutes (“H.R.S.”) Chapter 205A

1. Nansay Hawai‘i, Inc.’s (“Nansay”) sought to develop a resort complex consisting of two hotels, a golf course, clubhouse, a multiple family residential units, single family residential units, and other related improvements. The proposed development was located within the Kohanaiki ahupua‘a, and included 7,200 feet of coastline and anchialine ponds. The proposed development would have infringed on the general public’s access to and use of the beach area and the anchialine ponds.
   
2. On March 7, 1990, Nansay applied to the Commission for a special management area permit (“SMAP”). On September 28, 1990, and November 8, 1990, the Commission held public hearings on Nansay’s application. Public Access Shoreline Hawai‘i (“PASH”) was concerned about the impact of the proposed development on the preservation and protection of public beach and shoreline access. At the September 28, 1990 hearing, PASH requested for a contested case hearing, and at the November 8, 1990 hearing, PASH presented several grounds for its request. The Commission found that PASH did not have a sufficient interest in the proceeding to entitle PASH to contested case hearing procedures under the Commission’s rules (“Rules”). Subsequently, the Commission approved Nansay’s SMAP, and PASH appealed the Commission’s decision to the circuit court.
   
3. The circuit court found that the Commission inappropriately denied PASH’s request for a contested case hearing because PASH had a sufficient interest in the proceeding distinguishable from the general public. The Commission and Nansay appealed the circuit court’s decision.
   
4. The Intermediate Court of Appeals of Hawai‘i (“ICA”) held that undeveloped land used traditionally and currently by native Hawaiians for subsistence, religious, and cultural purposes created a right, which the Hawai‘i state courts had an obligation to preserve and protect. This obligation extended to the Commission. Accordingly, the court vacated the Commission’s denial of PASH’s request for a contested case hearing and remanded to the Commission with instructions to grant PASH’s request. Pilago was concerned that Nansay’s development would destroy important cultural sites, however, Pilago did not claim to have exercised any cultural or religious activities on the land in question. The ICA found that Pilago’s interest was indistinguishable from the general public and therefore insufficient to entitle him to contested case hearing procedures. Accordingly, the court affirmed the Commission’s decision denying Pilago’s request for a contested case hearing. The Supreme Court of Hawai‘i issued a writ of certiorari to review the ICA’s decision.
   
5. The court first considered whether the circuit court had jurisdiction to review the Commission’s decision by determining the following: (1) whether there was a contested case hearing; (2) whether there was a final decision and order; (3) whether PASH was involved, or participated, in the contested case hearing, and (4) whether PASH’s interest was injured. The court held that the circuit court had jurisdiction to review the Commission’s decision:
   a) A contested case hearing is: (1) required by law, and (2) determines the rights, duties, or privileges of specific parties. The court found that a public hearing for a SMAP application is required by H.R.S. § 205A-29. Additionally, Nansay sought to determine whether its interest was superior to the native Hawaiians’ protected interests in regards to the development site in Kohanaiki. Hence, the court held that the SMAP application proceeding was a contested case.
   b) H.R.S. § 205A-29 states that action on a SMAP is a final action, and the Commission gave its final views for the purposes of judicial review. Therefore, the court held that there was a final decision and order.
   c) The court found that PASH’s participation in the two public hearings was in compliance with the Rules and amounts to involvement in a contested case under H.R.S. § 91-14(a).
   d) The court reviewed de novo whether PASH had an interest injured by the approval of the SMAP for the land in Kohanaiki. The court agreed with the ICA’s assessment that PASH’s interest in the undeveloped area in the ahupua‘a was clearly distinguishable from the general public’s interest; PASH had demonstrated that the land had been traditionally and was currently used by native Hawaiians for subsistence, cultural, and religious purposes.
   
6. Nansay argued that the Commission did not have an obligation to protect and preserve the rights of native Hawaiians. Additionally, the Commission asserted that the obligation put an undue burden on the CZMA process. The court found that the Commission was obligated to protect and preserve the customary and traditional activities of native Hawaiians:
   a) Under the CZMA, a SMAP may be issued if the proposed development meets the following criteria: (1) it will not have a significant adverse environmental or ecological effect; (2) it is consistent with the objectives and policies of the CZMA and special management area guidelines, and (3) it is consistent with the applicable ordinances. Significant adverse effects include: (1) permanent loss or destruction of natural or cultural resources; (2) effects on the economy or social welfare of the public, and (3) acts inconsistent with the CZMA objectives and policies and special management area guidelines. The court found that PASH was entitled to protection under the CZMA because PASH’s asserted interests fell within these categories. Additionally, the court found that the Commission could impose conditions roughly proportional to the impact of the proposed development through the SMAP to preserve access to the subject property for traditional cultural, subsistence, and religious activities without violating constitutional protections.
   b) In addition to protections under the CZMA, the court held that Commission was obligated to preserve the customary and traditional rights of native Hawaiians under the Hawai‘i Constitution:
   
   i) In Kalipi v. Hawaiian Trust Co., 66 Haw. 1, 656 P.2d 745 (1982), the Supreme Court of Hawai‘i tried to conform the traditional native Hawaiian customary practices for land ownership to the modern system of land tenure. The court held that native Hawaiians could enter the undeveloped land of an ahupua‘a for customary, religious, and subsistence purposes. In making this determination, the court balanced the native Hawaiians’ interests and the harm it may cause once it is established that the activity had continued in a particular area. The interests protected, however, did not include non-traditional practices or customary rights exercised in an unreasonable manner. Kalipi did not address whether a native Hawaiian group could claim cultural rights in an ahupua‘a that they did not reside in.
   ii) In Pele Defense Fund v. Paty, 73 Hawai‘i 578, 837 P.2d 1247 (1992), the court held that a native Hawaiian group could claim gathering rights in an ahupua‘a not previously resided by the group.
   iii) The court looked at the development of land ownership in Hawai‘i and found that the western concept of land exclusivity is not universally applicable in Hawai‘i. A Hawaiian land patent confers a limited property interest unlike the western concepts of property.
   iv) The court defined customary rights under Hawai‘i law:
   
   1) Nansay contended that a group, who does not reside on the land, is not entitled to a customary right. In addition, Nansay challenges the holding in Pele claiming that it is inconsistent with fundamental nature of Hawaiian land tenure. The court disagreed with Nansay’s assertion and instead reaffirmed its holding in Pele. The court found that the State has an obligation to protect customary and traditional rights associated with tenancy in an ahupua‘a. Such rights could extend beyond the physical boundaries of that particular ahupua‘a. Therefore, the court held that common law tenancy rights do not limit Hawai‘i’s customary rights.
   2) The court examined the fifty-percent or more Hawaiian blood requirement for a Pele Defense Fund membership in Pele. The court found that the relevant Hawai‘i statutes do not specify the necessary blood quantum to qualify as a native Hawaiian. In addition, the court concluded that customary and tradition rights of native Hawaiians are not derived solely from their race and were not abolished when Hawai‘i became a United States territory. Thus, the court held that the native Hawaiian category includes descendants of native Hawaiians who inhabited the islands before 1778, regardless of their blood quantum.
   3) The court found that a traditional and customary right remains intact even though a particular site in an ahupua‘a has been abandoned and the right is potentially subject to regulation in the public interest.
   4) The court noted that native Hawaiian customary and traditional rights does not preclude landowners from developing their land. Additionally, the State retains the right to impose appropriate regulations on the exercise of native Hawaiian rights through the issuance of permits for the development of land that is undeveloped or not fully developed. Therefore, the State could potentially extinguish the rights of native Hawaiians to practice customary and traditional activities at a particular ahupua‘a if the land becomes fully developed and such practices have become inconsistent with the land. The court, however, declined to scrutinize the various gradations of property use that fall between undeveloped and fully developed land.
   
7. The court considered whether the recognition and protection of native Hawaiian rights on an ahupua‘a constitutes a judicial taking or regulatory taking:
   a) The court found that a judicial decision would constitute an unconstitutional taking of private property if it retroactively altered state law. The court held that it would not be a judicial taking if customary and traditional Hawaiian rights were recognized because western understanding of property law are not universally applicable in Hawai‘i and Hawaiian custom and usage has always been recognized in Hawai‘i state law.
   b) The Commission on remand would be required to protect PASH’s alleged customary rights possibly through Nansay’s permit to develop its land. The extent of imposed conditions on Nansay’s development project would be made until the contested case hearing occurred. Hence, the court held that any claim alleging a regulatory taking was premature until after the contested case hearing.
   
8. Accordingly, the court AFFIRMED the ICA’s decision and REMANDED to the Commission for further proceedings consistent with its analysis.