Hawaii’s Intermediate Court of Appeals Rejects “Private Attorney General” Fee-Shifting Doctrine In Land Court Case

BY ROBERT THOMAS – In 2009, in the “Superferry” case, the Hawaii Supreme Court, after years of hinting (but not finding a suitable vehicle), formally adopted the “private attorney general’ doctrine allowing attorneys’ fee shifting in certain select circumstances. See Sierra Club v. Dep’t of Transp., 202 P.3d 1226 (Haw. 2009). Under that doctrine, a court evaluating a claim for fees and costs evaluates three “factors” —

• The strength or societal importance of the public policy vindicated by the litigation.

• The necessity for private enforcement and a magnitude of the burden on the plaintiff.

• The number of people standing to benefit from the decision.

The first two factors are pretty vague and have not been further defined except in the initial instance in the Superferry case, in which the court held that when a case establishes a legal principle, it might qualify as “public policy” vindicated by the litigation, and when a plaintiff is going it alone and contradicting the government’s position it may show the need for private enforcement. As far as we know, since the theory was first adopted, no other Hawaii appellate court has approved of an award fees and costs under the private attorney general doctrine (believe us, we’ve tried in a couple of cases).

The Hawaii Intermediate Court of Appeals recently joined the list of courts narrowly construing the doctrine in Aloha Tower Dev. Corp. v. State of Hawaii, No. 30484 (Dec. 19, 2012), in which the ICA reversed a trial court’s award of private attorney general fees, concluding that the prevailing plaintiff did not satisfy the first or second part of the analysis.

The case was a Land Court fight over a deed restriction. The State sought to amend the certificate of title to Irwin Park, which had been donated to the State on the condition that it always be used as a park, although there were questions about whether the donor withdrew the condition while she was alive. The Aloha Tower Development Corporation apparently wants to construct a parking structure on the land, so it petitioned the Land Court to expunge the deed restriction. The heirs under the donor’s will responded, and Scenic Hawaiiintervened claiming that neither the State nor the heirs would adequately represent the public to argue the restriction was valid and had not been withdrawn.

Turns out the heirs did “vigorously” object, and further, the City and County of Honolulu intervened to object to the expungement request. The Land Court eventually concluded that the donor had not waived the condition, and refused to expunge it. Finally, applying the private attorney general doctrine, the court awarded Scenic Hawaii $135,637 in fees and costs.

The ICA construed the “societal importance of the public policy vindicated” by the litigation narrowly, rejecting the argument that Scenic Hawaii forced ATDC and the state to preserve the park for the public. The Land Court resolved a factual dispute about whether the donor had withdrawn the condition, and not a legal question of whether the government had a public trust duty to try and maintain the park as a park. Further, in the ICA’s view, the Land Court’s determination did not preserve Irwin Park, and the ruling was “only tangential” to that issue. The court contrasted that result with the Superferry case, which it held established a legal principle. The court also held there was no necessity for private enforcement, because both the heirs and the City appeared and defended. Because Scenic Hawaii did not meet the first two factors, the ICA did not consider the number of people benefitted by the decision.

Some thoughts:

• The ICA construed the private attorney general doctrine narrowly, holding that as a matter of law, the prevailing plaintiff must establish a legal principle, not simply win in a case that involves factual disputes that may arguably have some public benefit. The plaintiff’s goals don’t matter, nor do the results achieved, really. In footnote 9 (p. 12), the court explained that even though the Land Court’s ruling may have resulted in the state abandoning its parking structure plans, this did not rise to the level of vindicating “public policy.”

• With that limitation, it will be interesting to see whether trial courts can realistically  apply the private attorney general doctrine — after all, the only place to establish a legal principle is in an appellate court — or whether appellate courts have, in effect, reserved that privilege to themselves.

• Also, the court concluded that the plaintiff must actively contest the government’s action or policy, not merely serve as the “straw that stirs the drink,” to quote Reggie Jackson. Here, Scenic Hawaii didn’t go it alone, and although it bucked the state’s and ATDC’s goals, it was joined by the heirs and more importantly by the City. Hard to say that you are representing the public interest alone when a government is on your side.

• It’s our experience is that courts generally aren’t enthusiastic about awarding fees and costs, and this case and other attempts to recover fees under the private attorney general doctrine confirm that view.

The ICA’s opinion contains a concise history of the private attorney general doctrine in Hawaii (pages 6 – 11) and is worth reading for that alone.

Aloha Tower Dev. Corp. v. State of Hawaii, No. 30484 (Dec. 19, 2012)

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