Brothers claim victory in lawsuit over Kakaako streets

A dispute in the streets of Kakaako over what some participants view as extortion to park on what were long considered public roads has been settled after five years of litigation.

Six area business and landowners settled the case Wednesday against brothers Calvert and Cedric Chun who do business as Kakaako Land Co. and in 2010 began charging to park on at least eight roads they claim to have bought from an heir of a man who developed parts of Kakaako more t han 100 years ago.

Calvert Chun said all claims in the lawsuit, which contested ownership of the streets asserted by Kakaako Land, were dismissed. He also said the plaintiffs agreed to pay Kakaako Land an undisclosed sum of money.

Despite the settlement however, state officials maintain that seven roads are owned by the state under a 3-year-old Hawaii law that so far has not affected how the Chuns use the roads for parking income.

The state’s contention under the 2016 law is that the seven roads — whole or partial segments of Ward Avenue and Queen, Kawaiahao, Ilaniwai, Cooke, Cummins and Hustace streets — were conveyed to the Territory of Hawaii under a joint House and Senate resolution in 1903.

That action 116 year ago, Resolution No. 9, said the developer of the roads, Charles Desky, was “ready and willing” to convey the streets to the territory at no charge, and directed the superintendent of public works to accept a deed for the streets. However, no one has found evidence that such a deed was ever conveyed.

The state’s claim that ownership was conveyed under the resolution mirrors a claim that was ruled upon in the lawsuit before Wednesday’s settlement.

This ruling may cast doubt on the validity of the state’s claim under the 2016 law, Act 232.

Circuit Court Judge Jeffrey Crabtree ruled in August that the 1903 resolution didn’t transfer ownership of the streets because formal requirements of the resolution weren’t met.

“The court concludes Joint Resolution 9 did not result in transferring the Kakaako streets from Mr. Desky to the Territory in 1903,” the order said. “Joint Resolution 9 indicates an agreement was reached that Mr. Desky would transfer the Kakaako streets, and the government would accept. But, for whatever reason, a deed did not happen as far as the record shows.”

According to Chun, the ruling suggests that the state’s ownership claim based on the resolution is invalid even though the ruling doesn’t mention Act 232.

“That was the heart of the state’s case in attempting to claim title via the 1903 resolution,” Chun said in an email.

Act 232 states: “The acceptance by the territorial legislature or the legislature of a dedication of land in the Kakaako community development district by a private owner is sufficient to convey title to the state.”

The state Office of the Attorney General had a different take on whether Crabtree’s ruling undermines Act 232.

“Insofar as the order doesn’t reference Act 232 it doesn’t affect it,” Krishna Jayaram, special assistant to the attorney general, said in an email.

In January, the state recorded a quitclaim deed claiming ownership of the seven streets. The deed interestingly explains that ownership was transferred from the state to the state, and cites a section of Hawaii law amended by Act 232.

Quitclaim deeds don’t necessarily establish legal title to real estate because they don’t offer warranties against the existence of other ownership interests.

The Chun brothers filed their own quitclaim deed to the streets in 1985 after paying an heir of Desky $5,000 plus returns equal to 25% of rental income from the streets.

In 2010, the Chuns began reserving street parking that had long been free and charging $100 or more per month per space that included spots fronting many small businesses. Area businesses and residents complained about the restrictive parking, about streets not being maintained and about other safety issues, including parking in areas with city no-parking signs.

The business and landowners who sued included Queen Auto LLC, Theodore Uyeda, Hayashi Family Corp., Tropical Lamp &Shade Co., Tropical Otto Parts and U. Okada Co.

Burke, in the lawsuit, said he was coerced into renting parking stalls fronting his business. After he failed to pay, a law firm representing the Chuns demanded payment and noted that “a towing company is standing by.”

Michael Carroll, an attorney representing the plaintiffs, said he could not comment on the settlement because of a confidentiality clause.

The state, meanwhile, is trying to disrupt the parking control under a law passed last year that says privately owned roads in Kakaako must meet city construction and maintenance standards if the owner charges a fee for any use and the roads have been used by the public for at least six months.

The Chun brothers believe this law is invalid because it singles them out, and they have contested $250,000 in fines imposed under the law because the roads don’t meet the described standards.

Some Kakaako residents and business owners have been holding out for the city to seize ownership of the streets through condemnation. But that process has been dragging on for three years.

The Chuns have said they are open to selling the streets to the city.