Maui wildfire settlement clears Hawaii Supreme Court hurdle
ANDREW VLIET / SPECIAL TO THE HONOLULU STAR-ADVERTISER
An aerial view of destroyed structures six months after the devastating wildfire on August 8th that destroyed much of Lahaina.
A stalled $4 billion Maui wildfire litigation settlement has been propelled forward by a Hawaii Supreme Court ruling today.
The state’s high court ruled unanimously in answering three questions of Hawaii law that a Circuit Court judge used to underpin the validity of the settlement deal.
One key question pertained to whether state law supports the lower court’s ruling by Circuit Judge Peter Cahill that banned insurance companies from pursuing separate litigation seeking to have the settlement payers reimburse the insurance companies for claims the insurers paid to customers for losses in the Aug. 8, 2023, disaster that killed 102 people and destroyed most of Lahaina as well as property in Upcountry Maui.
All five Hawaii Supreme Court justices said in their written order that the exclusive remedy for a property and casualty insurer to recover claims paid for damages caused by a party deemed responsible for a wrongful act, when there is a settlement between the responsible party and the insured, is recovery from the insured.
The 3-page decision is being celebrated by lawyers who are leading the settlement effort on behalf of more than 17,000 victims, including plaintiffs who filed more than 600 lawsuits in Circuit Court on Maui seeking wildfire damages.
“We are absolutely thrilled with this decision from the Hawaii Supreme Court,” Cynthia Wong, liaison counsel for the plaintiffs group, said in an email. “Their ruling is a powerful affirmation of the law in Hawaii. They demonstrated an unwavering commitment to justice and fairness.”
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Wong said that the pending settlement can now be considered for approval by Cahill.
Attorneys for the insurers could not be reached for immediate comment. Close to 200 insurance companies have paid about $2.3 billion in claims so far to fire victims and expect to pay over $1 billion more. The companies may seek reimbursement from policyholders for any amount of compensation that exceeds the value of what policyholders lost.
The parties that have agreed to pay $4 billion to Maui fire victims are Hawaiian Electric, the state, Kamehameha Schools, Spectrum Oceanic LLC and Hawaiian Telcom. They sided with plaintiffs attorneys in the Supreme Court proceeding.
Hawaiian Electric has agreed to cover the biggest piece of the settlement, at $1.99 billion. A company power line damaged in high wind was found to be the cause of a fire that raged through Lahaina after reigniting.
The state and Kamehameha Schools, owners of land with vegetation that allowed the Lahaina fire to spread, agreed to pay $872.5 million each. Spectrum Oceanic LLC and Hawaiian Telcom, companies that share utility infrastructure with Hawaiian Electric, are to collectively pay about $300 million.
