A Molokai couple who accused their condo association and individual directors of harassing and intimidating them for trying to get new leaders elected to the board have settled their lawsuit against the association for about $1.2 million.
A jury previously had awarded the Ke Nani Kai Condominium homeowners nearly $4 million in damages to compensate them for what they said were six years of retaliation for seeking to oust the directors and an unlicensed contractor who has a criminal record but did work around the complex.
The verdict, believed to be the largest in Hawaii involving a nonconstruction condo dispute, captured the attention of condo boards throughout the state, particularly because three Ke Nani Kai directors — despite serving as volunteers — each were ordered to pay damages of $200,000 to $300,000.
A judge, however, subsequently set aside the verdict, saying it was flawed, and ordered a new trial.
The settlement, approved earlier this month by the court, effectively ends the case against the association and directors.
But the attorney for Jim and Nancy Bevill said his clients still plan to go to trial against the handyman, who also was named as a defendant.
The two insurance carriers for the association and directors will pay the Bevills $1.175 million as part of the settlement agreement. In return, all claims against them will be dismissed.
The case was closely watched here in part because Hawaii has the largest concentration of condominiums of any state in the country and because condo representatives say governance and neighbor-to-neighbor disputes have been on the rise.
According to the Bevills’ lawsuit, the couple became the target of threats, harassment and intimidation by a resident manager and the unlicensed contractor who was hired to do repairs around Ke Nani Kai. A small group of homeowners who controlled the board at the time directed or condoned the abuse, and the harassment intensified after the Bevills wrote a letter to Ke Nani Kai homeowners urging them to elect a new slate of directors, according to the lawsuit.
After an eight-week trial last year, a jury ruled for the Bevills on all 11 counts, finding that the directors, the association or their agents or employees engaged in racketeering, civil conspiracy, gross negligence, malicious prosecution, abuse of process, breach of contract and negligent and intentional infliction of emotional distress, according to the jury documents.
Lawyers for the defendants argued that the verdict was defective for several reasons, including having a judgment against the condo board even though the board wasn’t named as a defendant.
Maui Circuit Judge Rhonda Loo agreed to set aside the verdict and set a new trial for July 2014.
Plaintiffs’ attorney Terry Revere said the trial against the handyman, Frank Maurizio, will be held then.
Attorney Mark Bennett, who was hired by the insurance carriers to represent the association and directors after the jury reached its initial verdict, said his clients were pleased with the settlement because the judge agreed to dismiss all claims against them and because the settlement amount was far less than what the jury decided.
Given the uncertainties, expense and time involved in going to trial again, the association felt the settlement, which did not include any admission of wrongdoing, was a reasonable compromise, Bennett said.
The directors named in the lawsuit no longer are on the board.
Revere said his clients at one point were willing to let the association off the hook had their representatives agreed not to interfere with the Bevills’ attempt to get the handyman banned from the property, but that didn’t happen.
Maurizio could not be reached for comment.
