The private company that claims to own about 2 1/2 miles of crumbling streets in Kakaako said Tuesday that it’s poised to finally settle the lawsuit challenging its claim to those roads.
If that settlement is reached, Kakaako Land Co. would remain the owner of that stretch of road in the neighborhood despite state officials’ efforts to wrest away control, according to KLC co-owner Cedric Chun. The company would then pursue a separate quiet title action in court to uphold its ownership, he added.
The legal battle has already dragged on more than five years, with local businesses and residents stuck in the middle as the Chuns have charged tenants for parking and stretches of Clayton, Waimanu, Cummins, Kawaiahao, Ilaniwai and Queen streets have deteriorated.
“We are living in no-man’s land,” Robert Emami, owner of The Car Store on Kawaiahao, lamented Tuesday. “We’ve been going four, five years now. We’re living in this crap situation.”
Michael Carroll, the Honolulu attorney who represents several Kakaako business owners suing the Chuns in state Circuit Court, was unavailable to discuss the case Tuesday.
The docket shows a settlement conference slated for 10 a.m. Wednesday. Meanwhile, the state Attorney General’s office, which is also a party to the suit, maintains that the city has actually owned the Kakaako streets in question since the 1960s. However, if city leaders still think they need to condemn the streets they should go ahead and do so, it adds.
If the Chuns do prevail as the legal owners, they’ll move on to fight a hefty fine of more than $250,000. The Hawaii Community Development Authority issued that penalty earlier this year for KLC charging tenants to park while neglecting to repair the roads.
KLC is contesting the fine, but HCDA officials say they’ll await the outcome of the state lawsuit before scheduling a contested case hearing.
Chun said he and his brother, KLC co-owner Calvert Chun, think the city should acquire the roads from their company. In 2016, Honolulu city leaders approved a resolution to take those streets via eminent domain.
Officials in Mayor Kirk Caldwell’s administration have been slow to act since then.
Like HCDA, they appear to be waiting for an outcome in the suit, although Caldwell’s office was unable to respond to questions about the roads saga sent late Tuesday. If the city does eventually purchase the streets, KLC would likely see a windfall in the millions of dollars based on prior similar sales, according to Chun.
It’s all a far cry from “the end is near,” which House Speaker Scott Saiki declared of the Chuns’ control over those streets in April, when the HCDA fine was issued.
“I was anticipating HCDA would take action” and the state court would make a ruling in the lawsuit, Saiki said Monday. “That hasn’t happened.”
Emami called it “sad for the state of Hawaii and sad for the City and County of Honolulu” that local government hasn’t been able to resolve the problem.
Conditions are so bad that they pose a safety hazard to pedestrians, Emami said.
“Nothing is working,” he added.
The controversy over bustling Kakaako’s privately controlled streets dates back to 1903, when landowner Charles Desky dedicated his Kakaako streets to Hawaii’s former territorial government by way of a Senate resolution, according to court documents.
No deed for that transfer has ever been located, however.
“Here’s the crux of the entire controversy right here. For whatever reason, Desky did not deliver a deed to the territory,” Chun said Tuesday. “The problem is there is no deed, there is no conveyance.”
Nonetheless, local government maintained the roads for more than a century after the Senate resolution. Meanwhile, in 1985, Desky’s granddaughter, Adele Christian, passed ownership of her family’s Kakaako roads over to the Chuns.
“My brother and I — we were young guys and we just kind of stumbled on these streets” while doing research at the state Bureau of Conveyances, Chun said Tuesday.
“We just happened to flip open the phone book and find Adele Christian — we weren’t sure if she was alive or dead,” Chun added. “We had no plan. We just bought it.”
The brothers had no plans to charge parking at the time, he added — “we just bought it as a fluke.”
In 2010, however, they started charging tenants “at the urging of HCDA” to help prevent the homeless from taking shelter on those streets, according to Chun and KLC’s lawyer, Jonathan Ortiz.
HCDA officials further thanked the Chuns in an email that year for allowing state authorities on the roads they controlled in order to remove “squatters” and derelict property, part of a “Queen Street Beautification” project.
“Please note that no homeless advocates or media showed up at the event,” the HCDA email stated as it asked for the Chuns’ continued cooperation.
Still, the Chuns’ move to charge parking raised the ire of the surrounding community and prompted a showdown between KLC and the city.
Previously, the city had maintained the KLC-controlled roads as part of its public easement to use them, Chun said. Once KLC started charging tenants and towing cars, however, the city stopped that maintenance. They’ve largely fallen into disrepair.
“I do feel bad. People like Bob Emami – they’re kind of stuck in the middle,” Chun said Tuesday. “On the one hand the city should be maintaining it, on the other hand, the city doesn’t want to maintain it so people like Bob are just stuck.”
Chun declined to disclose how much KLC makes in parking fees — “my brother would kill me,” he quipped Tuesday. The company charges between $110 and $150 a month on more than 100 stalls, he did offer.
Chun added that the company has paid for some repairs and pothole patches where the damage was egregious, but it maintains that the repairs remain the city’s responsibility because of its easement. He further declined to say how much KLC has spent on those sporadic repairs.
“Do the other private owners have any obligation? We just want to be treated the same as everybody else. We are being singled out. The government is not harassing Bishop Estates,” Chun said, referring to Kamehameha Schools. “Or Howard Hughes.”
The two companies are prominent Kakaako landowners.
Still, Emami said tow trucks regularly patrol the streets controlled by the Chuns. They frequently swoop in and tow customers who park in assigned stalls, he added.
The combined value of the disputed roads is “not nominal,” Chun said Tuesday. In 2006, he said, the brothers sold a road in Waikiki — Pau Street — for about $10 million.
Thus, the lawsuit over those roads’ ownership remains high stakes.
In an Aug. 14 interim order, Judge Jeffrey Crabtree determined that the 1903 resolution isn’t sufficient to show Desky ultimately passed ownership on to the Territorial government.
Crabtree added, however, that the record of Desky’s heirs remains incomplete. It’s not confirmed that Desky’s granddaughter, Adele Christian, inherited those streets as hers to pass along to the Chuns, he said.
“Without a formal process to determine heirs, any judgement rendered by this court could be questioned and in fact invalidated in the future,” Crabtree wrote this past summer. “There must be an heirs determination before this case can be concluded.”
In the meantime, Emami said, many Kakaako business on those roads remain anxious. “We feel like we’re hostages,” he said.
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