Surfrider Foundation v. Zoning Bd. of Appeals, No. SCAP-13-0005781 (Haw. Sep. 23, 2015)

8/20/2019 Surfrider Foundation v. Zoning Bd. of Appeals, No. SCAP-13-0005781 (Haw. Sep. 23, 2015)

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I N THE SUPREME COURT OF THE STATE OF HAWAI ʻI

***FOR PUBLICATION IN WEST’S HAWAIʻI REPORTS AND PACIFIC REPORTER***

Electronically Filed

Supreme Court

SCAP-13-0005781

23-SEP-201509:22 AM

- - -o0o- -

SURFRI DER FOUNDATI ON; HAWAI I ’ S THOUSAND FRI ENDS; KA I WI COALI TI ON; and KAHEA – THE

HAWAI I AN- ENVI RONMENTAL ALLI ANCE, Pet i t i oners / Pl ai nt i f f s - Appel l ant s ,

vs .

ZONI NG BOARD OF APPEALS, CI TY & COUNTY OF HONOLULU; DI RECTOR OF THE DEPARTMENT OF PLANNI NG &

PERMI TTI NG, CI TY & COUNTY OF HONOLULU; KYO- YA HOTELS & RESORTS LP; AND 20, 000 FRI ENDS OF LABOR,

Respondent s/ Def endant s- Appel l ees.

SCAP- 13- 0005781

APPEAL FROM THE CI RCUI T COURT OF THE FI RST CI RCUI T( CAAP- 13- 0005781; CI V. NO. 13- 1- 0874- 03)

Sept ember 23, 2015

NAKAYAMA, McKENNA, POLLACK, AND WI LSON, J J . , WI TH RECKTENWALD, C. J . , CONCURRI NG SEPARATELY

OPI NI ON OF THE COURT BY POLLACK, J .

I. INTRODUCTION

I n 1976, t he Honol ul u Ci t y Counci l est abl i shed t he

Wai ki ki Speci al Desi gn Di st r i ct i n r esponse “to t he r api d


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devel opment of t he 1960s and 1970s, and the changes produced by

t hat devel opment . ” The Ci t y Counci l f ound t hat “[ t ] o t he wor l d,

Wai ki ki i s a r ecogni zed symbol of Hawai i [ ] and t he al l ur e of

Wai ki ki cont i nues, ser vi ng as t he anchor f or t he st at e’ s t our i st

i ndust r y. ” The Counci l concl uded t hat whi l e “Wai ki ki needs t o

mai nt ai n i t s pl ace as one of t he wor l d’ s pr emi er r esor t s i n an

i nt er nat i onal mar ket [ ] , t he sense of pl ace t hat makes Wai ki ki

uni que needs t o be r etai ned and enhanced. ” Accordi ngl y, t he

Ci t y Counci l devel oped speci f i c r equi r ement s and desi gn cont r ol s

“t o gui de car ef ul l y Wai ki ki ’ s f ut ur e and pr ot ect i t s uni que

Hawai i an i dent i t y. ”

Among t he pr ovi si ons enact ed t o pr ot ect Wai ki ki ’ s

Hawai i an i dent i t y i s a l i mi t at i on on devel opment next t o t he

shor el i ne. The Counci l est abl i shed a coast al hei ght set back

r equi r ement because of t he “need t o st ep back t al l bui l di ngs

f r om t he shor el i ne t o maxi mi ze publ i c saf et y and t he sense of

open space and publ i c enj oyment associ ated wi t h coast al

r esour ces. ” The Counci l al so pr ovi ded f or a var i ance pr ocess

when compl i ance wi t h t he Land Use Or di nance woul d r esul t i n

unnecessar y har dshi p.

I n t hi s case, we ar e cal l ed upon t o det er mi ne whether

a var i ance gr ant ed f or a pr oposed 26- st or y hot el and r esi dent i al

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t ower t hat permi t t ed a 74 percent encr oachment i nt o t he coast al

hei ght setback al ong t he Wai ki ki shor el i ne was pr oper l y i ssued. 1

II. BACKGROUND

A. The Waikiki Special District

The Land Use Or di nance of t he Ci t y and County of

Honol ul u ( LUO) desi gnat es “cer t ai n ar eas i n t he communi t y i n

need of r est or at i on, pr eservat i on, r edevel opment or

r ej uvenat i on” as speci al di st r i ct s. Revi sed Or di nances of t he

Ci t y and Count y of Honol ul u ( ROH) § 21- 9. 20 ( 1990) . For each

speci al di st r i ct, t he LUO set s f or t h obj ecti ves, i dent i f i es

pr omi nent vi ew cor r i dor s and hi st or i c pr oper t i es, and out l i nes

r equi r ement s and desi gn cont r ol s t o gui de devel opment t o

“pr ot ect [ and] enhance t he physi cal and vi sual aspect s of [ t he

di st r i ct ] f or t he benef i t of t he communi t y as a whol e. ” ROH §

21- 9. 20- 1.

The Honol ul u Ci t y Counci l ( Ci t y Counci l ) desi gnat ed

t he Wai ki ki Speci al Di st r i ct 2 “t o gui de car ef ul l y Wai ki ki ’ s

f ut ur e and pr ot ect i t s uni que Hawai i an i dent i t y. ” ROH § 21

1 The quot ed passages i n t he I nt r oduct i on ar e f r om provi si ons of t he Land Use Or di nance of t he Ci t y and Count y of Honol ul u t hat wi l l bedi scussed l at er i n t hi s Opi ni on.

2 The Wai ki ki Speci al Desi gn Di st r i ct was r enamed t he Wai ki kiSpeci al Di st r i ct . The boundar i es of t he WSD are def i ned by a map accessi bl ea t : ht t p: / / www. honol ul u. gov/ r ep/ si t e/ ocs/ r oh/ ROH_Chapt er _21_Exh9. 19. 18_ar t 10__ . pdf . pdf ( l ast vi si t ed Sept ember 2, 2015) . The WSD i s bounded ont he nort h and west by Al a Wai Bl vd. ( i ncl udi ng the pi er s i n t he Al a Wai YachtHarbor ) , on t he sout h by t he Paci f i c Ocean, and on t he west by Kapahul u Ave.

3

http://www.honolulu.gov/rep/site/ocs/roh/ROH_Chapter_21_Exh9.1http://www.honolulu.gov/rep/site/ocs/roh/ROH_Chapter_21_Exh9.1


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9. 80. Wi t hi n t he Wai ki ki Speci al Di st r i ct ( WSD) , t he Ci t y

Counci l r ecogni zed t he need t o st ep back bui l di ngs f r om t he

shor el i ne i n or der t o opt i mi ze “t he sense of open space and

publ i c enj oyment al ong t he beach. ” ROH § 21- 9. 80- 4( g) ( 2) . To

accompl i sh t hi s obj ect i ve, t he Ci t y Counci l est abl i shed t he

f ol l owi ng mi ni mum set backs t hat “appl y to al l zoni ng l ot s al ong

t he shor el i ne” wi t hi n t he WSD:

( A) Ther e shal l be a bui l di ng hei ght set back of 100 f eet i nwhi ch no st r uct ur e shal l be per mi t t ed. Thi s set back shal l

be measur ed f r om t he cer t i f i ed shor el i ne; [3

] and

( B)

Beyond t he 100- f oot l i ne ther e shal l be a bui l di ng hei ghtset back of 1: 1 (45 degr ees) measur ed f r om t he cer t i f i edshor el i ne.

ROH § 21- 9. 80- 4( g) ( 2) ( Coast al Hei ght Set back).

The WSD r equi r ement s and desi gn cont r ol s set f or t h i n

t he LUO ar e “suppl ement ed by a desi gn gui debook” ( WSD Desi gn

Gui debook) t hat “shal l be used as a pr i nci pal t ool by the

di r ect or t o expr ess t hose . . . el ement s whi ch demonst r at e

consi st ency wi t h t he i nt ent , obj ect i ves, gui del i nes, and

3 The cer t i f i ed shor el i ne i s depi ct ed i n ROH Exhi bi t 21- 1. 15, and

def i ned wi t hi n t he Hawai i Admi ni st r at i ve Rul es § 13- 222- 2 (adopt ed December13, 2002) , as “a si gned st atement by t he chai r person of t he boar d of l and andnatur al r esources t hat t he shorel i ne i s as l ocat ed and shown on t he map as of a cer t ai n dat e. ” “Shor el i ne” i s def i ned as:

t he upper r eaches of t he wash of t he waves, ot her t hanst or m or sei smi c waves, at hi gh ti de dur i ng the season oft he year i n whi ch the hi ghest wash of t he waves occur s,usual l y evi denced by the edge of vegetat i on gr owt h, or t heupper l i mi t of debr i s l ef t by t he wash of t he waves.

I d.

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st andar ds of t he [ WSD] . ” ROH § 21- 9. 80- 4. Wi t h r espect t o t he

Coast al Hei ght Setback, t he WSD Desi gn Gui debook pr ovi des, “A

set back f r om t he shor el i ne i s r equi r ed t o maxi mi ze publ i c

saf et y, t he sense of open space, l at er al access al ong t he beach,

and t he publ i c enj oyment associ at ed wi t h our coast al r esour ces. ”4

Addi t i onal l y, t he Coast al Hei ght Set back i s desi gned t o

“cont r i but e to a Hawai i an sense of pl ace” by “r educ[ i ng] t he

per cept i on of cr owdi ng, enhanc[ i ng] t he aest het i cs of Wai ki ki

and i mpar t [ i ng] a gr eat er sense of Hawai i ana i n t he bui l t

envi r onment . ” WSD Desi gn Gui debook at 25.

Al t hough the Ci t y Counci l enact ed t he LUO t o “pr ovi de

r easonabl e devel opment and desi gn st andar ds f or t he l ocat i on,

hei ght , bul k and si ze of st r uct ur es, ” a par t y may appl y f or a

var i ance on the basi s of unnecessar y har dshi p by submi t t i ng an

appl i cat i on t o t he Honol ul u Depar t ment of Pl anni ng and

Per mi t t i ng. Revi sed Char t er of t he Ci t y and Count y of Honol ul u

( RCCCH) § 6- 1517 ( 2000 Edi t i on, 2003 Supp. ) . I n or der t o

est abl i sh unnecessar y har dshi p, t he appl i cant must demonst r at e

t hat t he f ol l owi ng t hr ee requi r ement s as pr escr i bed i n t he Ci t y

Chart er have al l been met :

4 Dep’ t of Pl anni ng and Per mi t t i ng, Ci t y and Cnt y. of Honol ul u, WSDDesi gn Gui debook ( May 2002) , ht t p: / / www. honol ul udpp. or g/ Por t al s/ 0/ pdf s/ zoni ng/ WSD. pdf ( l ast vi si t ed Sept ember 2, 2015) ; ROH § 21- 9. 80- 4( g) ( 2) .

5

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On March 19, 2010, Kyo- ya submi t t ed var i ance

appl i cat i on No. 2010/ VAR- 9 ( var i ance appl i cat i on) t o t he

Depar t ment of Pl anni ng and Per mi t t i ng r equest i ng t hat t he

Pr oj ect be al l owed t o encr oach i nt o the Coast al Hei ght Set back.

As proposed, t he Pr oj ect woul d encr oach about 40 f eet i nt o t he

100- f oot coast al setback at t he bui l di ng’ s ewa cor ner 5 and about

60 f eet at t he Di amond Head cor ner . Addi t i onal l y, a si gni f i cant

por t i on of t he bui l di ng up t o t he 16t h f l oor woul d encr oach i nt o

t he 1: 1 hei ght set back measur ed f r om t he cer t i f i ed shor el i ne,

and “f r om t he 17t h f l oor , t he ent i r e bui l di ng encroaches i nt o

t he coast al hei ght set back. ” I n t ot al , “about 74. 3 per cent of

t he bui l di ng encr oaches i nt o t he Coast al Hei ght Set back”;

“Conver sel y, onl y 25. 7 per cent of t he bui l di ng compl i es wi t h t he

coast al hei ght set back. ”


I n i t s var i ance appl i cat i on, Kyo- ya mai nt ai ned t hat

al t hough t he Pr oj ect was “unabl e t o compl y wi t h t he st r i ct

r equi r ement s of [ t he Coast al Hei ght Set back] , ” t he Pr oj ect

sat i sf i ed t he t hr ee r equi r ement s f or i ssuance of a var i ance.

5 “Ewa” i s def i ned as a “[ p] l ace name west of Honol ul u, used as adi r ect i onal t er m. ” M. Pukui & S. El ber t , Hawai i an Di ct i onar y 42 ( r ev. ed.1986) .

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i. First Requirement: Deprived of the Reasonable Use of the

Applicant’s Land or Building

Kyo- ya argued i t woul d be depr i ved of t he r easonabl e

use of i t s l and i f t he LUO was st r i ct l y appl i ed because t he

or di nance woul d “r educe t he bui l dabl e por t i on of t he pr oper t y t o

r oughl y 11, 283 squar e f eet , or appr oxi mat el y 33% of t he whol e

l ot ar ea. ” I f t he LUO “wer e st r i ct l y f ol l owed, ” Kyo- ya

cont ended t hat i t “woul d not even be abl e to r ebui l d t he

exi st i ng [ DHT] . ”6

Kyo- ya mai nt ai ned t hat t he St ate of Hawai i ent er ed

i nt o an agr eement i n 1965 wi t h t he owners of cer t ai n beach f r ont

parcel s under whi ch t he St ate commi t t ed t o expand t he beach and

“[ p] r ot ect and pr eserve al l exi st i ng beach” i n a desi gnat ed ar ea

( 1965 Beach Agreement ) . 7 Al t hough t he contempl at ed beach

6 As di scussed i nf r a, t he LUO al l ows f or t he renovat i on orr econst r uct i on of nonconf or mi ng uses and st r uct ur es, subj ect t o cer t ai ncondi t i ons and appr oval s. See ROH § 21- 9. 80- 4( e) .

7 I n t he 1965 Beach Agreement , Li ne B r epr esents t he makaipr oper t y l i ne and Li ne A desi gnat es the cur r ent cert i f i ed shor el i ne. Thet ext of t he agr eement st at es, i n par t , as f ol l ows:

1. The St at e wi l l use i t s best ef f or t s t o const r uct t hebeach seawar d of Li ne B i n t he Sur f r i der- Royal Hawai i anSect or subst ant i al l y i n accor dance wi t h the Cooper at i vePr oj ect .

. . .

3. The Owner s wi l l r el ease and qui t cl ai m t o t he St at ef or ever al l of t hei r r especti ve estate, r i ght , t i t l e andi nt er est . . . i n and t o t he Sur f r i der - Royal Hawai i anSect or of Wai ki ki Beach now or f r omt i me to t i mehereaf t er exi st i ng seawar d of Li ne B, whet her cr eated by

( cont i nued . . . )

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expansi on was never compl eted, Kyo- ya asser t ed t hat had “t he

beach been const r uct ed by t he St ate” pur suant t o t he 1965 Beach

Agr eement , “i t i s l i kel y t hat t he beach f r ont i ng t he [ DHT] si t e

woul d be appr oxi mat el y 180 f eet wi der t han i t i s t oday” and the

shor el i ne woul d have been r ecer t i f i ed t o r ef l ect t he i ncr eased

wi dt h. Addi t i onal l y, i f t he beach had been extended, Kyo- ya

submi t t ed t hat “al most no por t i on of t he [ Pr oj ect ] woul d

encr oach i nt o t he coast al hei ght setback. ”

ii.

Second Requirement: Unique Circumstances

Kyo- ya cont ended t hat t he reasonabl eness of t he

nei ghborhood zoni ng was not dr awn i nt o quest i on by i t s var i ance

r equest because i t was “f or ced” t o appl y f or a var i ance due t o

uni que ci r cumst ances, r at her t han as a resul t of gener al

condi t i ons i n t he nei ghbor hood. For exampl e, t he Pr oj ect si t e


const r uct i on or ot her wi se, r eser vi ng t o the Owner s . . .f ul l and f r ee access bet ween t hei r r espect i ve abut t i ngl ands and t he sea across sai d beach and t o use sai dbeach f or a bathi ng beach and f oot passage.

. . .

5. The St at e wi l l r el ease and qui t cl ai m t o t he r espect i veOwner s . . . sever al l y i n pr opor t i on t o thei r r especti vef r ont ages al ong Li ne A . . . cont emporaneousl y wi t h t he

Owner s’ conveyance t o t he St at e . . . al l t he l and oft he Sur f r i der- Royal Hawai i an Sect or of Wai ki ki Beachbet ween Li nes A and B . . . PROVI DED, HOWEVER, t hat sai dl and between l i nes A and B shal l r emai n subj ect t o thepubl i c easement . . . unt i l a beach at l east sevent y-f i ve ( 75) f eet wi de shal l have been cr eat ed seaward of Li ne B.

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“i s bounded on t he Ewa si de by t he hi st or i c Banyan Wi ng, ” whi ch

i s l i st ed on t he Nat i onal and St at e Regi st er of Hi st or i c Pl aces.

Kyo- ya ar gued t hat i t had f or egone consi der abl e f i nanci al gai n

by choosi ng not t o redevel op t he Banyan Wi ng and t hat “[ i ] f Kyo

ya chose to r edevel op t hi s por t i on of t he compl ex, i t coul d

devel op a hot el or r esi dent i al t ower t hat meet s al l LUO, WSD and

[ Pl anned Devel opment - Resor t ( PD- R) ] r equi r ement s. ”

Addi t i onal l y, Kyo- ya cont ended t he Pr oj ect si t e “i s

among t he nar r owest par cel s of l and al ong Wai ki ki Beach” t hat i s

subj ect t o t he Coast al Hei ght Set back. ” The nar r owness of t he

Pr oj ect si t e “i s exacer bat ed, ” Kyo- ya ar gued, “by the absence of

t he subst ant i al beach whi ch was t o have been bui l t by t he St at e

per t he 1965 Beach Agr eement ” i n addi t i on t o t he pr esence of t he

hi st or i c Banyan Wi ng. Kyo- ya f ur t her argued t hat t he par cel ’ s

“uni que si ze and shape” caused t he i mpact of t he Coast al Hei ght

Set back t o be “gr eat er t han on any ot her par cel al ong Wai ki ki

Beach. ”

iii. Third Requirement: Essential Character of the Neighborhood

and Intent and Purpose of the Ordinance

Wi t h r espect t o the t hi r d r equi r ement , Kyo- ya

submi t t ed t hat t he var i ance “wi l l not al t er t he essent i al

char act er of t he l ocal i t y nor be cont r ar y t o t he i nt ent and

pur pose of t he zoni ng code. ” Kyo- ya char acter i zed Wai ki ki as “a

densel y devel oped, ur bani zed ar ea, f i l l ed wi t h l ar ge hot el s,

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condomi ni ums, and mi xed- use pr oj ect s whi ch push (and i n many

cases exceed) t he l i mi t s of per mi t t ed hei ght s, densi t i es, and

ot her zoni ng and bui l di ng r egul at i ons. ” Kyo- ya ar gued t hat many

of t he “exi st i ng hot el s al ong Wai ki ki Beach al r eady encr oach

i nt o t he coast al hei ght set back” and t hat al l owi ng t he Pr oj ect

t o si mi l ar l y encr oach woul d not al t er t he essent i al char act er of

Wai ki ki . Kyo- ya cont ended t he Proj ect ’ s “mauka- makai

or i ent at i on, i ncr eased publ i c open space, i mpr oved beach access

and addi t i on of sur f boar d r acks shoul d go a l ong way t oward

r est or i ng t he char act er of Wai ki ki . ”

Addi t i onal l y, Kyo- ya asser t ed t he Pr oj ect was

consi st ent wi t h WSD obj ect i ves t o “[ p] r ovi de f or t he abi l i t y to

r enovat e and r edevel op exi st i ng st r uct ur es whi ch mi ght ot herwi se

exper i ence det er i or at i on” and al l ow f or “cr eat i ve devel opment

capabl e of subst ant i al l y cont r i but i ng t o r ej uvenat i on and

r evi t al i zat i on of t he [ WSD] . ” Kyo- ya mai nt ai ned t hat t he

Proj ect was consi st ent wi t h t he WSD obj ect i ve t o “i mpr ove where

possi bl e mauka vi ews . . . and a vi sual r el at i onshi p wi t h t he

ocean” and t he obj ect i ve t o “[ p] r ovi de peopl e- or i ent ed,

i nt er act i ve, l andscaped open spaces t o of f set t he hi gh- densi t y

urban ambi ence. ”

Fi nal l y, Kyo- ya ar gued t hat t he i mpact of t he

encr oachment i nt o t he Coast al Hei ght Setback woul d be mi t i gated

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by the St ate of Hawai i ’ s pl anned Wai ki ki Beach Mai nt enance

Pr oj ect ( Beach Mai nt enance Pr oj ect ) t hat i s “expect ed t o add

r oughl y f or t y- f eet ( 40’ ) of dr y beach t o t he beach f r ont i ng t he

[ DHT] . ”

C. Director’s Decision

The Di r ect or hel d a publ i c hear i ng on Kyo- ya’ s

var i ance appl i cat i on and subsequent l y i ssued Fi ndi ngs of Fact ,

Concl usi ons of Law, and Deci si on and Or der ( Di r ect or ’ s Deci si on

or Deci si on) gr ant i ng “Par t i al Appr oval ” of Kyo- ya’ s var i ance

appl i cat i on.

I n hi s Deci si on, t he Di r ect or descr i bed t he var i ance

appl i cat i on as a request t o al l ow t he Pr oj ect t o encr oach

appr oxi mat el y 74 per cent i nt o t he Coast al Hei ght Set back. The

Di r ect or not ed t hat i n addi t i on t o t he var i ance r equest f r om t he

Coast al Hei ght Set back, t he Pr oj ect r equi r ed addi t i onal

appr oval s and permi t s, i ncl udi ng a Pl anned Devel opment - Resort

( PD- R) Per mi t . 8

8 The purpose of a PD- R permi t i s descr i bed wi t hi n t he LUO asf ol l ows:

[ T] o pr ovi de oppor t uni t i es f or cr eat i ve r edevel opment not

possi bl e under a st r i ct adherence to t he devel opmentst andar ds of t he speci al di st r i ct. Fl exi bi l i t y may bepr ovi ded f or pr oj ect densi t y, hei ght , pr eci nct t r ansi t i onalhei ght set backs, yar ds, open space and l andscapi ng whent i mel y, demonst r abl e cont r i but i ons benef i t i ng t he communi t yand t he st abi l i t y, f unct i on, and over al l ambi ance andappear ance of Wai ki ki are pr oduced.


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hei ght set backs, ”9 t he “bui l di ng woul d have t o t ake t he f or m of a

massi ve monol i t hi c wal l . ” The Di r ect or concl uded t hat i n

compar i son, t he Pr oj ect “of f er s some i mpor t ant desi gn advant ages

t hat are more conduci ve t o t he WSD desi gn obj ect i ves, but t hat

can onl y be accompl i shed by a t r ade- of f i n t er ms of coast al

set back encr oachment s. ”

The Di r ect or addr essed t he physi cal const r ai nt s of t he

si t e t hat r est r i ct devel opment al ong t he shor el i ne. The

Di r ect or f ound t hat i f t he zoni ng code was st r i ct l y appl i ed, t he

bui l dabl e ar ea of t he DHT Lot “woul d be reduced t o l ess t han 35

per cent ” wi t h a maxi mum hei ght l i mi t of about 170 f eet .

Consequent l y, t he Di r ect or f ound t hat i f Kyo- ya wer e not gr ant ed

t he request ed var i ance, Kyo- ya “woul d not be abl e t o devel op i n

accor dance wi t h t he [ PD- R] per mi t . ”

Next , t he Di r ect or f ound t hat t he ext ent of Kyo- ya’ s

r equest ed 74 percent encr oachment i nt o t he Coast al Hei ght

Set back woul d have been si gni f i cant l y r educed “[ i ] f t he beach

9 “Pr eci nct t r ansi t i onal hei ght set backs” i s a di st i nct r equi r ementunder t he LUO and separ ate f r omt he Coast al Hei ght Set back at i ssue i n thi sappeal . As set f or t h i n ROH Tabl e 21- 9. 6( B) and ROH § 21- 9. 80- 6( c) ( 2) ,pr eci nct t r ansi t i onal hei ght set backs ar e as f ol l ows:

Tr ansi t i onal Hei ght Setbacks. For any por t i on of ast r uct ur e above 40 f eet i n hei ght , addi t i onal f r ont , si deand r ear hei ght set backs equal t o one f oot f or each 10 f eeti n hei ght , or f r acti on t her eof , shal l be pr ovi ded. Wi t hi nt he hei ght setback, bui l di ngs wi t h gr aduat ed, st epped f ormsshal l be encour aged ( see Fi gur e 21- 9. 2) .

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had been const r uct ed and/ or mai nt ai ned as agr eed t o by t he St ate

[ under t he 1965 Beach Agr eement , because] t he cer t i f i ed

shor el i ne woul d pr obabl y be l ocat ed much f art her seaward t han

t he exi st i ng shor el i ne. ” The Di r ect or r easoned, “The pr oposal ,

vi ewed i n [ t he cont ext of t he 1965 Beach Agr eement ] , i s not

excessi ve. ” The Di r ect or addi t i onal l y f ound t hat under t he

Wai ki ki Beach Mai nt enance Pr oj ect , t he beach woul d be i ncr eased

by 40 f eet and t hat t he cer t i f i ed shor el i ne “woul d l i kel y

r ef l ect t he beach expansi on. ”

The Di r ect or concl uded t hat “[ f ] or t hese and ot her

r easons, ” Kyo- ya “woul d be deni ed r easonabl e use of t he si t e i f

not al l owed t o encr oach i nt o t he pr esent 100- f oot coast al

set back and t he coast al hei ght set back. ” However , t he Di r ector

al so concl uded t hat “t he pr oposed set back encr oachment exceeds

what woul d be al l owed i f t he beach wi dt h were i ncr eased by 180

f eet ”; t her ef or e, “t he hei ght of t he [ Pr oj ect ] shoul d be r educed

t o compl y wi t h t he . . . coast al hei ght setback as measur ed f r om

. . . ( t he beach wi dt h i nt ended i n t he 1965 [ Beach] Agr eement ) . ”

Wi t h r egard t o t he second r equi r ement of t he var i ance

t est , t he Di r ect or f ound Kyo- ya’ s appl i cat i on t o be “suppor t ed

by uni que ci r cumst ances” i ncl udi ng t hat t he Pr oj ect l ot i s “one

of t he nar r owest l ot s al ong t he shor el i ne i n [ t he] ar ea except

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f or t he publ i c beach par k l ot s. ”10 The Di r ect or not ed t hat

compl i ance wi t h t he 20- f oot f r ont yar d set back and t he 100- f oot

coast al set back ef f ect i vel y r educes t he bui l dabl e ar ea of t he

DHT l ot by 33 percent .

The Di r ect or f ound t he shor el i ne t o be anot her “uni que

ci r cumst ance [ of t he si t e] . ” The Di r ect or st at ed t hat whi l e t he

“var i ance and/ or encr oachment s ar e based on t he exi st i ng

[ cer t i f i ed] shor el i ne, ” “t he shor el i ne al ong t he si t e i s subj ect

t o dr ast i c change by ar t i f i ci al means, and, i n f act , may move

seaward by r oughl y 40 f eet under t he pl anned [ Wai ki ki Beach

Mai nt enance Pr oj ect ] . ” I n l i ght of t he r est or at i on pl an, t he

Di r ect or concl uded, “I t woul d be r easonabl e t o al l ow f ul l

devel opment t o pr oceed at t hi s t i me, consi der i ng t hat t he

encr oachment s wi l l be r educed subst ant i al l y once t he beach

r est or at i on i s done. ”

As t o t he t hi r d r equi r ement of t he var i ance t est , t he

Di r ect or concl uded t he Pr oj ect woul d not al t er t he essent i al

char act er of t he nei ghbor hood. The Di r ect or f ound t he

10 The Di r ect or not ed t hat Kyo- ya’ s Speci al Management Per mi t

r equi r ed Kyo- ya t o pr eser ve t he hi st or i c Banyan Wi ng f or a mi ni mum of 25years and t hat “[ t ] he pr oposed encr oachment s woul d permi t [ Kyo- ya] , i nef f ect , t o t r ansf er some of t he devel opment potent i al f r omt he Banyan Wi ngsi t e t o t he DHT si t e. ” The Di r ect or mai nt ai ned t hi s “t r ansf er ” woul d “be af ai r t r ade- of f , si nce t he pr oposal woul d al so pr omote sever al i mpor t ant WSDgoal s and obj ect i ves. ” However , t he Di r ect or al so noted t hat Kyo- ya“i ndi cat ed t hat [ i t has] no i nt ent i on of r emovi ng t he hi st or i c Banyan Wi ng. ”

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“est abl i shed char act er of Wai ki ki ” t o be “a densel y popul at ed

and hi ghl y devel oped, ur bani zed area, whi ch i ncl udes a wi de mi x

of l and uses. ” Fur t her , t he Di r ect or not ed t hat “[ m] any

exi st i ng st r uct ur es ar e nonconf or mi ng and exceed t he hei ght

l i mi t and maxi mum densi t y [ ] , encr oach i nt o requi r ed yar ds and

set backs, and l ack the mi ni mum open space and l andscapi ng. ”

The Di r ect or addi t i onal l y f ound t he Pr oj ect t o be

“consi st ent wi t h sever al i mpor t ant WSD obj ect i ves. ” The

Di r ect or det er mi ned t hat “t he new bui l di ng i s necessary t o

r epl ace an agi ng, decl i ni ng st r uct ur e wi t h a new, mor e

at t r act i ve and f unct i onal st r uct ur e, whi ch wi l l enhance Wai ki ki

as a vi si t or dest i nat i on”; al l ow Kyo- ya t o pr eser ve t he hi st or i c

Banyan Wi ng; and “provi de[ ] publ i c access t o t he beach, vi ew

channels from Kalākaua Avenue t o t he ocean, as wel l as other

si gni f i cant publ i c benef i t s . ”

Af t er anal yzi ng t he var i ance t est ’ s t hr ee

r equi r ement s, t he Di r ect or made the f ol l owi ng Concl usi ons of

Law:

1)

There i s evi dence t hat t he Appl i cant woul d be depr i vedof a r easonabl e use of t he l and or bui l di ng i f t hepr ovi si ons of t he zoni ng code wer e st r i ct l y appl i ed.

2) The r equest of t he appl i cant i s due t o uni queci r cumst ances and not t o general nei ghbor hoodcondi t i ons, and i t does not quest i on t he r easonabl enessof t he nei ghborhood zoni ng.

3) The r equest wi l l not al t er t he essent i al char act er oft he nei ghborhood nor be cont r ary to t he i nt ent andpur pose of t he zoni ng or di nance.

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Accor di ngl y, t he Di r ect or gr ant ed par t i al appr oval of Kyo- ya’ s

var i ance appl i cat i on t o al l ow t he Pr oj ect t o encr oach

appr oxi mat el y 74 per cent i nt o t he Coast al Hei ght Set back. The

Di r ector ’ s par t i al appr oval was condi t i oned on, i nt er al i a,

submi ssi on of r evi sed pl ans “whi ch show t he [ Pr oj ect ] shal l

compl y wi t h t he 1- t o- 1 ( 45- degr ee angl e) coast al hei ght setback

as measured f r om . . . ( t he appr oxi mat e beach wi dt h i nt ended i n

t he [ 1965 Beach Agr eement ] ) . ”11

III. Appellate Proceedings

A. Zoning Board of Appeals12

Sur f r i der Foundat i on, Hawai i ’ s Thousand Fr i ends, Ka

I wi Coal i t i on, and KAHEA- - The Hawai i an Envi r onment al Al l i ance

( col l ect i vel y, Sur f r i der) f i l ed a pet i t i on ( Pet i t i on) t o t he

Zoni ng Boar d of Appeal s ( ZBA) chal l engi ng the Di r ect or ’ s

f i ndi ngs and concl usi on t hat Kyo- ya’ s r equest f or a var i ance

f r om t he Coast al Hei ght Set back met t he r equi r ement s f or

i ssuance of a var i ance as set f or t h by t he Ci t y Char t er . 13 I n

11 Accor di ng to Kyo- ya, t he Di r ect or ’ s condi t i on ef f ect i vel y r educedt he hei ght of t he Pr oj ect by appr oxi mat el y si x f l oor s.

12 The ZBA hel d a hear i ng t o deci de mot i ons t o i nt er vene f i l ed by

numerous par t i es at whi ch the ZBA grant ed i nt ervenor st atus t o Kyo- ya, 20, 000Fri ends of Labor , Hawai i ’ s Thousand Fr i ends, Ka I wi Coal i t i on, Sur f r i derFoundat i on, and KAHEA- - The Hawai i an Envi r onment al Al l i ance.

13 Kyo- ya f i l ed a mot i on t o di smi ss Sur f r i der ’ s appeal , ar gui ng t hatSur f r i der ’ s appeal was subst ant i vel y and pr ocedur al l y i nsuf f i ci ent underRCCCH § 6- 1516.


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i t s posi t i on st at ement , Sur f r i der ar gued t hat t he Di r ect or ’ s

concl usi on t hat t he Pr oj ect sat i sf i ed t he t hr ee r equi r ement s of

RCCCH § 6- 1517 was based on er r oneous f i ndi ngs of mater i al

f act s .

Sur f r i der mai nt ai ned t hat Kyo- ya di d not meet t he

f i r st r equi r ement f or i ssuance of a var i ance because “t he r ecor d

i ndi cat es t hat [ Kyo- ya] woul d not be depr i ved of r easonabl e use

of t he pr oper t y i f t he var i ance i s deni ed. ” Sur f r i der cont ended

t hat t he “proper t y i s al r eady occupi ed by a nonconf or mi ng, 8

st or y hot el bui l di ng t hat can be f ul l y renovat ed wi t hout t he

need f or a var i ance under t he [ LUO] , ” t hat Kyo- ya was not

ent i t l ed to achi eve al l of t he appl i cabl e maxi mum devel opment

st andar ds i n the LUO, and that t he 1965 Beach Agreement had not

been r eal i zed.


RCCCH § 6- 1516 pr ovi des, i n r el evant par t , as f ol l ows:

Sect i on 6- 1516. Zoni ng Boar d of Appeal s –

. . . An appeal shal l be sust ai ned onl y i f t he boar d f i ndst hat t he di r ect or ’ s act i on was based on an er r oneousf i ndi ng of a mat er i al f act , or t hat t he di r ect or had act edi n an ar bi t r ar y or capr i ci ous manner or had mani f est l yabused di scr et i on.

The ZBA gr anted i n part , and deni ed i n par t Kyo- ya’ s mot i on. The ZBA f oundt hat Sur f r i der “asser t ed i n [ i t s] Pet i t i on t hat t he Di r ector ’ s acti on i npar t i al l y appr ovi ng t he Var i ance Appl i cat i on was based upon one or moreer r oneous f i ndi ngs of mat er i al f act ” but t hat Sur f r i der “di d not al l ege orar gue i n t he Pet i t i on t hat any aspect of t he Di r ect or ’ s act i on . . . wasar bi t r ar y or capr i ci ous or a mani f est abuse of t he Di r ect or ’ s di scret i on. ”

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Sur f r i der ar gued t hat Kyo- ya f ai l ed t o meet t he second

r equi r ement because t he pr oper t y i s not par t i cul ar l y uni que and

i s t ypi cal of t he gener al condi t i ons of ocean- f r ont pr oper t y i n

t hat par t of Wai ki ki . ” Thus, Sur f r i der mai nt ai ned t hat t he

r easonabl eness of t he nei ghbor hood zoni ng i s i n f act dr awn i nt o

quest i on by t he var i ance request .

Sur f r i der ar gued t he thi r d r equi r ement was al so not

met because “t he r equest , i f appr oved, wi l l al t er t he essent i al

char act er of t he l ocal i t y and i s cont r ar y t o t he i nt ent and

pur pose of t he zoni ng code. ” Sur f r i der poi nt ed out t hat t he

Di r ect or ’ s f i ndi ngs “di d not even addr ess whet her t he pr oj ect i s

cont r ary to t he i nt ent and pur pose of t he WSD, whose obj ect i ves

cent er on mai nt ai ni ng Wai ki ki ’ s uni que Hawai i an i dent i t y and

r educi ng t he appar ent hei ght of bui l di ngs. ”

Kyo- ya, t he Di r ect or , and 20, 000 Fr i ends of Labor

( Fr i ends of Labor ) each f i l ed a posi t i on st at ement wi t h t he ZBA.

Kyo- ya ar gued t hat Sur f r i der “f ai l [ ed] t o al l ege a si ngl e

f i ndi ng of mat er i al f act t o have been i n er r or l et al one

‘ cl ear l y er r oneous. ’ ” Kyo- ya mai nt ai ned t hat t he Di r ect or

speci f i ed t he par t i cul ar evi dence t hat suppor t ed hi s gr ant i ng of

t he var i ance and pr oper l y concl uded t hat al l t hr ee requi r ement s

f or a zoni ng var i ance had been sat i sf i ed.

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As t o the f i r st var i ance r equi r ement , Kyo- ya cont ended

t hat i t woul d be deni ed r easonabl e use of i t s pr oper t y i f i t

wer e not al l owed t o encr oach i nt o t he Coast al Hei ght Set back.

Kyo- ya asser t ed t hat t he 1965 Beach Agr eement conf er r ed on i t

“r i ght s and expect at i on gr ant ed by the st ate” t hat must be

consi dered i n det er mi ni ng what r easonabl e use i t coul d expect of

i t s pr oper t y. Kyo- ya addi t i onal l y ar gued t hat i t “has t he r i ght

under t he cur r ent WSD and i t s PD- R t o const r uct t he

densi t y/ f l oor ar ea i t pr oposes” but t hat wi t hout t he var i ance

t he r esul t i ng bui l di ng woul d be mat er i al l y i nconsi st ent wi t h t he

WSD obj ect i ves and gui del i nes.

Wi t h r egard t o t he second r equi r ement , Kyo- ya asser t ed

t hat t he Moana Par cel has t he gr eat est wi dt h- t o- dept h r at i o of

any par cel al ong Wai ki ki Beach and i ncl udes a hi st or i c

st r uct ur e. Thus, Kyo- ya ar gued t he Di r ect or proper l y concl uded

t hat t he Moana Par cel has uni que ci r cumst ances t hat do not cal l

i nt o quest i on t he gener al zoni ng code.

I n addr essi ng t he t hi r d r equi r ement , Kyo- ya

mai nt ai ned, “I t cannot be di sput ed t hat Wai ki ki i s a hi ghl y

ur bani zed ar ea [ ] wi t h many l ar ge and t al l bui l di ngs i n cl ose

pr oxi mi t y t o t he Moana Par cel . ” Kyo- ya t her ef or e cont ended t he

“essent i al char act er of t he nei ghbor hood i s a dense ur ban area

f ul l of t al l hot el and condo bui l di ngs. ”

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23/78


Accor di ngl y, t he ZBA deni ed Sur f r i der ’ s appeal of t he

Di r ector ’ s Deci si on. 14 Sur f r i der t i mel y f i l ed a not i ce of appeal

t o t he Ci r cui t Cour t of t he Fi r st Ci r cui t ( ci r cui t cour t ) f r om

t he ZBA Or der .

B. Circuit Court

I n i t s openi ng br i ef , 15 Sur f r i der ar gued t hat t he

Di r ect or br eached hi s dut y t o enf orce the LUO when he gr ant ed

Kyo- ya a par t i al var i ance “cont i ngent upon compl i ance wi t h a

hypot het i cal cer t i f i ed shor el i ne 180 f eet out t o sea f r om t he

cur r ent cer t i f i ed shor el i ne. ” Sur f r i der cont ended t hat

“var i ances must be based on t he cur r ent cer t i f i ed shor el i ne, not

some undetermi ned f ut ur e shor el i ne. ”

Sur f r i der next addr essed t he requi r ement s f or i ssuance

of a var i ance. As to t he f i r st r equi r ement of t he var i ance

t est , Sur f r i der r easser t ed t he f ol l owi ng: ( 1) t he Di r ector di d

not pr ovi de evi dent i ar y suppor t f or i t s concl usi on t hat Kyo- ya

woul d be depr i ved of t he r easonabl e use of i t s l and i f i t was

r equi r ed t o compl y wi t h t he Coast al Hei ght Set back; ( 2) t he

Di r ect or er r oneousl y f ound t hat t he f ai l ur e of t he St at e t o

14 The ZBA addi t i onal l y noted Sur f r i der wai ved any ar gument t hat t heDi r ect or act ed i n an ar bi t r ar y or capr i ci ous manner or had mani f est l y abusedhi s di scret i on.

15 I n i t s openi ng br i ef , Sur f r i der pr esent ed sevent een poi nt s of er r or and i dent i f i ed ni ne er r oneous f i ndi ngs wi t h r espect t o t he ZBA Or der .

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25/78


I n hi s answer i ng br i ef , t he Di r ect or r est at ed hi s

f i ndi ngs of f act and anal ysi s cont ai ned wi t hi n hi s Deci si on and

r easser t ed hi s concl usi ons. The Di r ect or cont ended t hat ,

cont r ar y t o Sur f r i der ’ s ar gument , he di d not r el y upon t he 1965

Beach Agreement t o det er mi ne whet her Kyo- ya woul d be deni ed

r easonabl e use under RCCCH § 6- 1517, but r ather t o consi der t he

r easonabl eness and i mpose a l i mi t on t he extent of t he var i ance

per mi t t ed.

Kyo- ya and Fr i ends of Labor ar gued i n t hei r r espect i ve

answer i ng br i ef s t hat none of t he al l eged er r oneous f act s

Sur f r i der i dent i f i ed wer e act ual l y er r oneous or mat er i al t o t he

Di r ector ’ s Deci si on. 16 Kyo- ya asser t ed t hat cont r ar y to

Sur f r i der ’ s cont ent i on, t he ZBA’ s f i ndi ngs of f act wer e “mor e

t han adequat e” t o suppor t i t s concl usi on.

Kyo- ya al so cont ended t hat Sur f r i der “mi sconst r ue[ d]

t he Di r ect or ’ s Deci si on, ” whi ch “di d not gr ant a var i ance t hat

i s ‘ condi t i oned upon compl i ance wi t h a hypot het i cal cer t i f i ed

shor el i ne. ’ ” Kyo- ya f ur t her ar gued t hat Sur f r i der ’ s

i nt er pr et at i on of case l aw as r equi r i ng t he appl i cant t o pr ove

t hat i t “woul d have been deni ed ‘ any reasonabl e use’ but f or”16 I n i t s r epl y br i ef t o Fr i ends of Labor , Sur f r i der mai nt ai ned t hat

t he Di r ect or di d not eval uat e the “economi c vi abi l i t y of t he pr oposedst r uct ur e as compar ed t o other st r uct ur al opt i ons” but r ather based hi sdeci si on on “a ser i es of hypothet i cal scenar i os that amount t o er r oneousf acts . ”

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t he var i ance i s mi sl eadi ng, woul d el i mi nat e t he Di r ect or ’ s

di scr et i on, and “woul d br i ng an end t o l and use i n Hawai i as i t

has been pr act i ced si nce st at ehood. ”

Af t er a hear i ng on Sur f r i der ’ s appeal , t he ci r cui t

cour t ent er ed i t s Fi ndi ngs of Fact , Concl usi ons of Law, and

Deci si on and Or der Af f i r mi ng t he Deci si on and Or der of t he ZBA

( ci r cui t cour t ’ s Or der ) . The ci r cui t cour t concl uded t hat

Sur f r i der “f ai l ed t o sat i sf y [i t s] bur den t o demonst r at e t hat

t he Di r ect or ’ s act i on i n par t i al l y appr ovi ng t he [ Zoni ng]

Var i ance Appl i cat i on was based on any er r oneous f i ndi ngs of

mat er i al f act. ”

Sur f r i der f i l ed a not i ce of appeal f r om t he ci r cui t

cour t ’ s Or der af f i r mi ng the ZBA Or der . 17

C. Supreme Court18

I n i t s openi ng br i ef , Sur f r i der r ei t er at es t hat i t was

Kyo- ya’ s bur den t o pr ove t hat i t s pr oj ect sat i sf i es al l t hr ee

r equi r ement s of t he var i ance t est and t hat t he Di r ect or ’ s

17 On Apr i l 10, 2014, Sur f r i der f i l ed an appl i cat i on t o t r ansf er i t sappeal t o t hi s cour t , whi ch was gr ant ed on May 15, 2014.

18 Addi t i onal l y, Sur f r i der cont ends t he Di r ector f ai l ed t o

adequat el y suppor t hi s f i ndi ngs and t hat evi dence of i nsuf f i ci ent mat er i alsupport f or a requi r ed f act ual f i ndi ng t hat a var i ance r equi r ement has beenmet i s evi dence of an er r oneous f i ndi ng, not evi dence of abuse of di scr et i on.Kyo- ya ar gues t hat Sur f r i der ’ s chal l enge t o t he Di r ect or ’ s r el i ance on t he1965 Beach Agr eement , as wel l as t o t he Di r ector ’ s det ermi nat i on of whethert he Pr oj ect meet s t he thr ee requi r ement s of t he var i ance test , i nvol ves t heDi r ect or ’ s di scr et i on, and was t hus wai ved.

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Deci si on “pl ai nl y i ndi cat e[ s] t hat nei t her [ Kyo- ya] nor t he

Di r ect or met [ t hei r ] bur den. ” 19 Sur f r i der agai n poi nt s out t hat

t he 1965 Beach Agr eement “does not pr ovi de a l egal basi s f or a

var i ance” f r om t he LUO “whi ch r equi r es bui l di ng setbacks t o be

measur ed f r om t he cur r ent cer t i f i ed shor el i ne. ” Sur f r i der asks

t hat t hi s cour t r ever se t he ci r cui t cour t ’ s Or der and t he

Di r ect or ’ s Deci si on and deny Kyo- ya’ s var i ance appl i cat i on.

Kyo- ya r esponds t hat t he Di r ect or di d not r el y on t he

1965 Beach Agr eement t o j ust i f y t he var i ance, but r at her l ooked

t o t he agr eement af t er t he Di r ector determi ned “a var i ance was

war r ant ed” t o det er mi ne t he extent of t he var i ance t o gr ant . I n

any event , Kyo- ya argues t hat “even i f Sur f r i der coul d somehow

show t hat consi der at i on of t he 1965 Beach Agreement was

i mpr oper , t hi s woul d not be suf f i ci ent t o rever se the ZBA. ”

Wi t h r espect t o f i ndi ng depr i vat i on of “r easonabl e use, ” Kyo- ya

ar gues “t hi s was not a si t uat i on wher e Kyo- ya was s i mpl y t r yi ng

t o make a ‘ gr eat er pr of i t ’ ; i nst ead, t he Di r ect or f ound t hat t he

var i ance was ‘ necessary t o mai nt ai n economi c vi abi l i t y. ’ ” Kyo

19 Sur f r i der addi t i onal l y ar gues t hat t he Di r ect or does not havedi scr et i on t o gr ant var i ances f r om“mandatory zoni ng code r equi r ement s. ”Because Sur f r i der di d not previ ousl y r ai se t hi s ar gument , i t i s notconsi der ed. Mi zoguchi v. St at e Far m Mut . Aut o. I ns. Co. , 66 Haw. 373, 383,663 P. 2d 1071, 1077 ( 1983) .

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ya addi t i onal l y r easser t s ar gument s t hat i t pr evi ousl y made i n

pr i or pr oceedi ngs. 20

IV. Standards of Review

A. Findings and Conclusions

Revi ew of a deci si on made by t he ci r cui t cour t upon

i t s r evi ew of an agency’ s deci si on i s a secondar y appeal .

Korean Buddhi st Dae Won Sa Templ e of Hawai i v. Sul l i van, 87

Hawai i 217, 229, 953 P. 2d 1315, 1327 ( 1998) . The st andard of

r evi ew i s one i n whi ch t hi s cour t must determi ne whether t he

ci r cui t cour t was r i ght or wr ong i n i t s deci si on, appl yi ng t he

st andar ds set f or t h i n HRS § 91- 14( g) t o t he agency’ s deci si on.

I d.

Under HRS § 91- 14( g) ( 5) ( 1993) , f i ndi ngs of f act ar e

r evi ewed t o det er mi ne whether t hey ar e “[ c] l ear l y er r oneous i n

vi ew of t he r el i abl e, pr obat i ve, and subst ant i al evi dence on t he

whol e r ecor d. ” A f i ndi ng of f act i s cl ear l y er r oneous when t he

r ecor d l acks subst ant i al evi dence- - i . e. , cr edi bl e evi dence of a

suf f i ci ent qual i t y and pr obat i ve val ue t o enabl e a per son of

r easonabl e caut i on t o suppor t a concl usi on- - t o suppor t t he

f i ndi ng. Br emer v. Weeks, 104 Hawai i 43, 51, 85 P. 3d 150, 158

20 The Di r ect or and Fr i ends of Labor each f i l ed t hei r r espect i veanswer i ng br i ef s i n whi ch t hey assert ed argument s t hat were submi t t ed i n t hepr oceedi ngs bel ow or pr esent ed by Kyo- ya i n i t s answer i ng br i ef .

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( 2004) ; McPherson v. Zoni ng Bd. of Appeal s, 67 Haw. 603, 606,

699 P. 2d 26, 28 ( 1985) .

A “[ concl usi on of l aw] t hat pr esent s mi xed quest i ons

of f act and l aw i s r evi ewed under t he cl ear l y er r oneous s t andar d

because t he concl usi on i s dependent upon t he f act s and

ci r cumst ances of t he par t i cul ar case. ” Pr i ce v. Zoni ng Bd. of

Appeal s of Ci t y & Cnt y. of Honol ul u, 77 Hawai i 168, 172, 883

P. 2d 629, 633 ( 1994) . Because t he Di r ect or ’ s concl usi ons of l aw

i n t hi s case pr esent ed mi xed quest i ons of f act and l aw, t hey ar e

r evi ewed “under t he cl ear l y er r oneous st andar d t o det er mi ne i f

t he agency deci si on was cl ear l y er r oneous i n vi ew of r el i abl e,

pr obat i ve, and subst ant i al evi dence on t he whol e r ecor d. ” Poe

v. Hawai i Labor Rel at i ons Bd. , 87 Hawai i 191, 195, 953 P. 2d 569,

573 ( 1998) .

B. Incompetent Evidence

“The admi ssi on of i r r el evant or i ncompet ent mat t er

bef or e an admi ni st r at i ve agency does not const i t ut e r ever si bl e

er r or i f t her e i s subst ant i al evi dence i n t he r ecor d t o sust ai n

t he agency’ s det er mi nat i on. ” Shor ba v. Bd. of Educ. , 59 Haw.

388, 397, 583 P. 2d 313, 319 ( 1979) ( quot i ng Schyman v. Dep’ t of

Regi st r at i on & Educ. , 133 N. E. 2d 551, 525- 26 ( I l l . App. Ct .

1956) ) . However , i f a pet i t i oner can show pr ej udi ce r esul t i ng

f r om t he admi ssi on of i r r el evant or i ncompet ent evi dence, t he

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admi ss i on of such evi dence may be gr ounds f or r eversal . See

i d. ; Pr i ce, 77 Hawai i at 176, 883 P. 2d at 637. “[ P] r ej udi ce

cannot be al l eged t o t he admi ss i on of i mpr oper evi dence unl ess

i t be shown t hat t he [ agency] r el i ed on i t . ” Shor ba, 59 Haw. at

397, 583 P. 2d at 319 ( quot i ng Schyman, 133 N. E. 2d at 561- 562) .

C. Interpretation of a Statute, Ordinance, or Charter

“The i nt er pr et at i on of a st at ut e, or di nance or char t er

i s a quest i on of l aw r evi ewabl e de novo. ” Kor ean Buddhi st , 87

Hawai i at 229, 953 P. 2d at 1327 ( al t er at i ons omi t t ed) ( quot i ng

St ate v. Ar ceo, 84 Hawai i 1, 10, 928 P. 2d 843, 852 ( 1996) )

( i nt er nal quot at i on mar ks omi t t ed) .

V. Discussion

The Di r ect or may grant a var i ance f r om a provi si on of

t he LUO upon t he gr ound of unnecessary hardshi p i f t he thr ee

r equi r ement s set f or t h i n RCCCH § 6- 1517 have been sat i sf i ed:

( 1) t he appl i cant woul d be depr i ved of t he reasonabl e useof such l and or bui l di ng i f t he pr ovi si ons of t he zoni ngcode wer e st r i ct l y appl i cabl e;

( 2) t he r equest of t he appl i cant i s due t o uni queci r cumst ances and not t he gener al condi t i ons i n thenei ghborhood, so that t he r easonabl eness of t henei ghborhood zoni ng i s not dr awn i nt o quest i on; and

( 3) t he r equest , i f appr oved, wi l l not al t er t he essent i alchar act er of t he nei ghborhood nor be cont r ar y t o t he i nt entand pur pose of t he zoni ng or di nance.

“The bur den of est abl i shi ng t he f act ual f oundat i on f or t he

f or egoi ng l egal pr econdi t i ons r est s wi t h t he appl i cant , ” Kor ean

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Buddhi st , 87 Hawai i at 234, 953 P. 2d at 1332 ( ci t i ng McPher son,

67 Haw. at 607, 699 P. 2d at 28) ; however , i t i s t he Di r ect or

who, pr i or t o gr ant i ng a var i ance, must “speci f y t he par t i cul ar

evi dence whi ch support s t he gr ant i ng of t he var i ance. ” RCCCH §

6- 1517. 21 I n i t s appeal , Sur f r i der ar gues t hat t he ci r cui t cour t

er r ed i n af f i r mi ng t he ZBA Or der and t he Di r ect or ’ s Deci si on

because t he Di r ect or ’ s f i ndi ngs and concl usi ons di d not

demonst r at e t hat Kyo- ya sat i sf i ed t he t hr ee r equi r ement s f or

i ssuance of t he var i ance.

A. Deprived of the Reasonable Use of Land or Building

To sat i sf y t he f i r st var i ance r equi r ement , t he r ecor d

must show t hat “t he appl i cant woul d be depr i ved of t he

r easonabl e use of such l and or bui l di ng i f t he pr ovi si ons of t he

zoni ng code wer e st r i ct l y appl i cabl e. ” RCCCH § 6- 1517.

“Reasonabl e use, ” wi t hi n t he meani ng of t he char t er , “i s not

necessar i l y t he use most desi r ed by t he pr oper t y owner ”; r at her ,

t o be depr i ved of t he r easonabl e use of i t s pr oper t y, t he

pr oper t y owner must est abl i sh an i nabi l i t y t o make r easonabl e

21 The r ol e of t he Di r ect or i n eval uat i ng an appl i cat i on f or a

var i ance f r om a pr ovi si on of t he LUO i s gr eat er t han t hat of an i mpar t i alar bi t er of f act. “Unl i ke an or di nar y cour t , t he [ Di r ector] has the f uncti onof ser vi ng as an advocat e of t he publ i c i nt er est . ” Fi nal Report of t heChar t er Commi ss i on of t he Ci t y and County of Honol ul u 1971- 1972 at 34( ci t at i on omi t t ed) . The Di r ect or “ shoul d al ways pl ace t hi s consi der at i onf or emost , r at her t han l ooki ng upon i t s dut i es as t hat of a si mpl e ar bi t r at i onof di sput es among pr i vat e par t i es. ” I d.

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use of i t s l and or bui l di ng wi t hout t he var i ance. Kor ean

Buddhi st , 87 Hawai i at 234- 5, 953 P. 2d at 1332- 33 ( appl i cant

f ai l ed t o show t hat i t coul d not make r easonabl e use of t he l and

or i t s hal l wi t hout t he r equest ed var i ance) ; McPher son, 67 Haw.

at 605- 06, 699 P. 2d at 28 ( f i ndi ng t he appl i cant had not

est abl i shed depr i vat i on of r easonabl e use because t he recor d was

“devoi d of any evi dence that t he appl i cant coul d not make

r easonabl e use of t he l and or bui l di ngs i n conf or mi t y wi t h t he

[ zoni ng code] or her pr e- exi st i ng nonconf or mi ng use”) ; see al so

RCCCH § 6- 1517 n. 30 ( “[ W] i t hi n t he meani ng of t he chart er , ”

“r easonabl e use” “i s not t he use most desi r ed by t he pr oper t y

owner; [ t he] pr opert y owner must show i nabi l i t y t o make any

r easonabl e use of hi s l and wi t hout t he var i ance. ”) .

I n t hi s case, t he Di r ect or concl uded “[ t ] her e i s

evi dence t hat [ Kyo- ya] woul d be depr i ved of a reasonabl e use of

t he l and or bui l di ng i f t he [ Coast al Hei ght Set back] was

st r i ctl y appl i ed” f or t he f ol l owi ng r easons: t he Pr oj ect i s

necessary t o mai nt ai n economi c vi abi l i t y; t he zoni ng code woul d

r educe t he bui l dabl e ar ea of t he DHT l ot ; i f not al l owed t he

var i ance, Kyo- ya woul d not be abl e t o devel op i n accor dance wi t h

t he PD- R permi t ; t he 1965 Beach Agr eement woul d have r esul t ed i n

a si gni f i cant l y di f f er ent bui l dabl e ar ea on t he si t e; and t he

cur r ent beach r epl eni shment pr oj ect wi l l ext end t he beach wi dt h

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by a mi ni mum of 40 f eet and t he cer t i f i ed shor el i ne wi l l l i kel y

r ef l ect t he beach expansi on. 22

Sur f r i der chal l enges bot h t he Di r ect or ’ s ul t i mat e

concl usi on t hat Kyo- ya sat i sf i ed t hi s r equi r ement of t he

var i ance t est , as wel l as sever al of t he under l yi ng f i ndi ngs t he

Di r ect or based hi s concl usi on upon. Sur f r i der speci f i cal l y

cont ends t hat t he Di r ect or er r oneousl y f ound t hat Kyo- ya woul d

be deni ed reasonabl e use based on t he 1965 Beach Agreement and

t hat t he Pr oj ect “i s necessar y t o mai nt ai n economi c vi abi l i t y. ”

Each of t he Di r ect or ’ s r easons f or concl udi ng t hat “t her e i s

evi dence” t hat Kyo- ya woul d be depr i ved of t he r easonabl e use of

t he l and i s addr essed bel ow.

i. Economic Viability23

The Di r ect or based hi s concl usi on t hat Kyo- ya woul d be

depr i ved of a “r easonabl e use” i f t he Coast al Hei ght Set back was

st r i ctl y appl i ed i n par t on hi s f i ndi ng t hat t he Pr oj ect “i s

22 The Di r ect or addi t i onal l y ment i oned several WSD obj ect i ves i n hi sdi scussi on of t he f i r st r equi r ement of t he var i ance t est . For exampl e, t heDi r ect or st at ed t hat mai nt ai ni ng economi c vi abi l i t y i s consi st ent wi t h t heWSD obj ect i ve t o “pr ovi de oppor t uni t i es f or cr eat i ve devel opment t hatcont r i but e[ s] t o t he r ej uvenat i on and r evi t al i zat i on of t he speci aldi st r i ct . ” The Di r ect or ’ s di scussi on of t he WSD obj ect i ves wi l l be di scussedi n r el at i on t o the t hi r d r equi r ement of t he var i ance t est - - t he i nt ent and

pur pose of t he LUO- - as t he obj ect i ves do not per t ai n to whet her t he recor dest abl i shes t hat Kyo- ya woul d be deni ed the reasonabl e use of i t s l and undert he f i r st r equi r ement of t he var i ance t est .

23 Because t he part i es anal yze one aspect of r easonabl e use of t hel and or bui l di ng i n t er ms of economi c vi abi l i t y, we appl y thi s measure of anal ysi s i n t hi s case.

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necessary t o mai nt ai n economi c vi abi l i t y. ” Sur f r i der ar gues

t hat t he Di r ector ’ s f i ndi ng as t o economi c vi abi l i t y i s

er r oneous because i t i s not suppor t ed by t he r ecor d. Kyo- ya,

t he Di r ect or , and Fr i ends of Labor ar gue that t he Di r ect or

suf f i ci ent l y f ound t hat t he Pr oj ect was necessar y f or economi c

vi abi l i t y and t hat i t was Sur f r i der ’ s bur den t o pr ove ot her wi se.

To r ei t er at e, i n or der t o demonst r at e depr i vat i on of

r easonabl e use wi t hi n t he meani ng of t he Ci t y Char t er , t he

pr oper t y owner must est abl i sh an i nabi l i t y t o make r easonabl e

use of i t s l and or bui l di ng wi t hout t he r equest ed var i ance.

Kor ean Buddhi st , 87 Hawai i at 234- 35, 953 P. 2d at 1332- 33;

McPher son, 67 Haw. at 605- 06, 699 P. 2d at 28; see al so RCCCH §

6- 1517 n. 30; Fi nal Repor t of t he Char t er Commi ssi on of t he Ci t y

and Count y of Honol ul u 1971- 1972 at 33 ( ci t at i on omi t t ed)

( “[ T] he pr oper t y owner must be abl e t o show, i f he compl i es wi t h

t he pr ovi si ons of t he or di nance, t hat he cannot make any

r easonabl e use of hi s pr oper t y. ”) . 24

24 I n Korean Buddhi st , t he appl i cant sought a var i ance af t er t hef act f or i t s newl y const r uct ed t empl e hal l t hat exceeded t he maxi mum hei ght

al l owed under t he zoni ng code. 87 Hawai i at 234- 35, 953 P. 2d at 1332- 33. I naf f i r mi ng t he Di r ector’ s deni al of t he var i ance, t hi s cour t hel d, i nt er al i a,t hat “‘ r easonabl e use’ of t he l and, wi t hi n t he meani ng of t he Ci t y Char t er ,i s not necessar i l y t he use most desi r ed by t he owner. ” I d. The cour tr easoned that because the appl i cant f ai l ed “t o est abl i sh that i t coul d makeno reasonabl e use of t he l and or i t s Hal l wi t hout ” t he hei ght var i ance, t hef i r st r equi r ement of t he var i ance t est had not been sat i sf i ed. I d.


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Fur t her , “t he f act t hat [ an appl i cant ] mi ght make a

gr eat er pr of i t by usi ng hi s pr oper t y i n a manner pr ohi bi t ed by

t he or di nance i s consi der ed i r r el evant , si nce al most any

i ndi vi dual appl i cant coul d make t hat same showi ng. ” Korean

Buddhi st , 87 Hawai i at 234- 35, 953 P. 2d at 1332- 33 ( quot i ng

Fi nal Repor t of t he Char t er Commi ssi on of t he Ci t y and Count y of

Honol ul u 1971- 1972 at 33) ; see al so 3 E. C. Yokl ey, Zoni ng Law &

Pr act i ce, § 20- 7 ( 4t h ed. 1979) ( “Under t hi s pr ong of t he t est ,

t he f act t hat anot her use woul d be mor e pr of i t abl e t o t he

pr oper t y owner i s not a suf f i ci ent basi s f or a boar d t o gr ant a

var i ance. ”) ; Dep’ t of Pl anni ng and Per mi t t i ng, Ci t y and Cnt y. of

Honol ul u, Zoni ng Var i ance Gui debook (August 3, 2010) ,

ht t p: / / www. honol ul udpp. or g/ Por t al s/ 0/ pdf s/ zoni ng/ zvar 2. pdf

( “Var i ances cannot be gi ven t o . . . al l ow t he appl i cant t o save

money or make mor e money on a pr oposed proj ect . ”) .

As Sur f r i der ar gues, al t hough t he Di r ect or f ound t hat

t he var i ance was necessar y t o “mai nt ai n economi c vi abi l i t y, ”


Si mi l ar l y, i n McPher son, t hi s cour t f ound t he r ecor d t o be“devoi d of any evi dence t hat t he appl i cant coul d not make r easonabl e use of

t he l and or bui l di ngs i n conf ormi t y wi t h t he [ zoni ng code] or her pr eexi st i ng nonconf ormi ng use, ” and t hus we concl uded t hat t he ZBA’ s cont r aryf i ndi ng was cl ear l y er r oneous. 67 Haw. at 605- 06, 699 P. 2d at 28. I n otherwords, because t he appl i cant had not est abl i shed that she coul d not makeot her r easonabl e use of t he l and or bui l di ngs but f or t he var i ance, t he cour thel d t hat t he appl i cant f ai l ed t o sat i sf y the f i r st r equi r ement of t hevar i ance t est. I d.

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t her e i s no f i nanci al dat a25 i n t he r ecord t o suppor t such a

f i ndi ng; r at her , i t appear s t he Di r ect or mer el y r eci t ed

st at ement s Kyo- ya made i n i t s var i ance appl i cat i on: “[ t ] he

Appl i cant i ndi cat es” t hat t he “f aci l i t i es and ameni t i es of t he

exi st i ng [ DHT] ar e ext r emel y out dat ed”; i f t he DHT “i s not

al l owed t o be r edevel oped t hat woul d cont r i but e t o t he decl i ne

of t he al r eady agi ng st r uct ur e”; and “[ t ] he Appl i cant suggest s”

t hat an ol der hot el “cannot compet e wi t h ot her t our i st

dest i nat i ons t hat of f er super i or accommodat i ons. ”26 However ,

t hese st atement s ar e merel y assert i ons of Kyo- ya unsupport ed by

t he r ecord. See McPherson, 67 Haw. at 606, 699 P. 2d at 29

25 Al t hough the Di r ector di d not make any economi c f i ndi ngs as t ot he exi st i ng DHT or t he pr oposed Proj ect , he di d make f i ndi ngs as t o t heeconomi cs of t he Banyan Wi ng and a t heoret i cal r econst r uct ed Banyan Wi ng i nhi s anal ysi s of t he second r equi r ement of t he var i ance t est . The Di r ect orf ound t hat a r econst r uct ed Banyan Wi ng may i ncrease i n val ue by 79 percentcompar ed wi t h t he cur r ent wi ng. However , as not ed supr a, t he Banyan Wi ng i sa hi st or i c st r uct ur e t hat cannot be redevel oped f or a mi ni mum of 25 year s.Addi t i onal l y, t he Di r ect or not ed t hat Kyo- ya i ndi cat ed “t hat t hey have noi nt ent i on of r emovi ng t he hi st ori c Banyan Wi ng. ” Thus, t he economi c f i ndi ngsper t ai ni ng t o the Banyan Wi ng are not r el evant t o whet her Kyo- ya woul d bedeni ed t he r easonabl e use of t he l and i f not al l owed a var i ance f r omt heCoast al Hei ght Set back f or t he Pr oj ect .

26 The ent i r et y of t he Di r ect or ’ s anal ysi s per t ai ni ng t o economi cvi abi l i t y of t he DHT t ower i s as f ol l ows:

The Appl i cant i ndi cat es t hat t he f aci l i t i es and ameni t i esof t he exi st i ng Di amond Head Tower are ext r emel y out dat ed.I f t he DHT i s not al l owed t o be redevel oped, t hat woul d

cont r i but e t o t he decl i ne of t he al r eady agi ng st r uct ur e. The Appl i cant suggest s t hat ol der hot el s t hat of f ersubst andar d vi si t or accommodat i ons are not at t r act i ve t ot he modern vi si t or and of t en cannot compet e wi t h ot hert our i st dest i nat i ons t hat of f er super i or accommodat i ons.

Thus, t he proposal i s necessar y t o mai nt ai n economi cvi abi l i t y.

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Mor eover , even i f t he recor d est abl i shed that t he DHT

was “ext r emel y out dated” and woul d cont i nue t o decl i ne i f not

al l owed t o be r edevel oped, t hose “f act s” al one woul d not support

t he f i ndi ng t hat t he Pr oj ect i s necessary t o mai nt ai n economi c

vi abi l i t y because t he LUO expr essl y al l ows exi st i ng

nonconf ormi ng bui l di ngs wi t hi n t he WSD t o be r epai r ed and

r enovat ed as l ong as t he l evel of nonconf ormi t y i s not

i ncr eased. 27 See ROH § 21- 9. 80- 4( e) ( 3) ( “Nonconf ormi ng uses

shal l not be l i mi t ed t o ‘ or di nar y r epai r s’ or subj ect t o val ue

l i mi t s on r epai r s or r enovat i on wor k per f or med. ”) .


( “[ T] he Char t er l i mi t s t he power of t he [ Di r ect or ] t o gr ant

var i ances t o cases where a r at her nar r ow and somewhat t echni cal

set of f act s must be est abl i shed. ”) .

Addi t i onal l y, ROH § 21- 9. 80- 4( e) al l ows a

nonconf ormi ng st r uct ur e t o be repl aced by an ent i r el y new

27 Ot her j ur i sdi ct i ons have hel d t hat i f “t he pr oper t y has anonconf ormi ng use, t her e i s an addi t i onal bur den on t he appl i cant t oest abl i sh t hat mai nt ai ni ng t he nonconf ormi ng use wi l l not al l ow t he appl i cantt o r eal i ze a r easonabl e r et ur n. ” 2 Am. Law. Zoni ng § 13: 15 ( 5t h ed. ) ; seeal so O’ Connor v. Over al l Laundr y, 183 N. E. 134, 138 (I nd. App. 1932) ( “I t i snot a har dshi p or pr act i cal di f f i cul t y i n t he meani ng of t he st at ut e when acor por at i on’ s busi ness has out gr own i t s bui l di ng t o r ef use t o al l ow t hem t oadd t o t hei r pr esent bui l di ng. ”) ; Cr ossroads Recreat i on, I nc. v. Br oz, 149N. E. 2d 65, 67- 69 ( N. Y. 1958) ( uphol di ng t he deni al of a var i ance t o renovat e

a nonconf ormi ng use, because t he owner of a nonconf ormi ng gas st at i on f ai l edt o show he coul d not r eal i ze a r easonabl e ret ur n by conver t i ng the pr oper t yt o a use per mi t t ed by t he zoni ng ordi nances) ; Goodman v. Zoni ng Bd. of Revi ewof Cr anst on, 254 A. 2d 743 ( R. I . 1969) ( r ever si ng t he gr ant of a var i ance t oconver t a nonconf ormi ng nur sery i nt o a car deal ershi p because t here wasi nsuf f i ci ent pr oof t hat cont i nued use of t he nur sery woul d depr i ve t he ownerof al l benef i ci al use of t he l and) .

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st r uct ur e, subj ect t o cer t ai n condi t i ons. Accor di ngl y, even

assumi ng t her e was evi dence i n t he r ecor d t hat est abl i shed t hat

t he exi st i ng DHT i s not economi cal l y vi abl e due t o i t s agi ng

st r uct ur e and “subst andard accommodat i ons, ” r enovat i on and or

r epl acement of a nonconf or mi ng bui l di ng subj ect t o cer t ai n

condi t i ons i s expr essl y aut hor i zed by t he LUO. For t hi s r eason

al so, t her e i s i nsuf f i ci ent evi dence i n t he r ecor d t o show t hat

t he Pr oj ect i s necessar y t o mai nt ai n economi c vi abi l i t y. See

ROH § 21- 9. 80- 4( e) .

The Zoni ng Var i ance Gui debook ( Var i ance Gui debook)

pr ovi des sampl e cases t o i l l ust r at e how each r equi r ement of t he

var i ance t est may be pr oper l y appl i ed. Zoni ng Var i ance

Gui debook, supr a. The Var i ance Gui debook’ s second sampl e case

pr ovi des a par t i cul ar l y rel evant exampl e of an appl i cant who

r equest ed a var i ance t o bui l d an addi t i on t o a dwel l i ng t hat

woul d encr oach i nt o t he si de yar d set back. The Gui debook notes

i n t hi s hypot het i cal case, “The appl i cant ar gue[ d] t hat t he

encr oachment i s necessary because i t i s t he most pr act i cal ,

cost - ef f ect i ve sol ut i on. ” I n eval uat i ng t he var i ance r equest ,

t he Var i ance Gui debook notes t hat t he appl i cant coul d bui l d a

conf or mi ng addi t i on i n ot her l ocat i ons on t he l ot . I d. at 4.

The Gui debook concl udes t hat t he “var i ance cannot be suppor t ed, ”

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i n par t , because “t he appl i cant i s not depr i ved of r easonabl e

use, si nce al t er nat i ves ar e avai l abl e. ” I d. at 5.

The Var i ance Gui debook’ s exampl e i s consi st ent wi t h

t he Kor ean Buddhi st deci si on wher e t hi s cour t hel d t hat an

appl i cant who sought a var i ance t o const r uct a t al l er bui l di ng

t han t hat aut hor i zed by t he or di nance had not demonst r ated

depr i vat i on of r easonabl e use because t he r ecor d showed t hat t he

appl i cant coul d have const r uct ed a shor t er , compl i ant bui l di ng.

87 Hawai i at 234- 35, 953 P. 2d at 1332- 33. Thus, t he mer e f act

t hat Kyo- ya cannot bui l d t he speci f i c bui l di ng desi gn i t desi r es

i s not suf f i ci ent t o suppor t a f i ndi ng t hat Kyo- ya woul d be

depr i ved of t he r easonabl e use of i t s l and or bui l di ng. See

Si nger v. Phi l a. Zoni ng Bd. of Adj ust ment , 29 A. 3d 144, 150 ( Pa.

Commw. Ct . 2011) ( “I t i s wel l - set t l ed t hat i n or der t o est abl i sh

unnecessar y har dshi p f or a di mensi onal var i ance, an appl i cant

must demonst r at e somet hi ng more t han a mer e desi r e t o devel op a

pr oper t y as i t wi shes or t hat i t wi l l be f i nanci al l y bur dened i f

t he var i ance i s not gr ant ed. ”) ; Kor ean Buddhi st , 87 Hawai i at

234- 35, 953 P. 2d at 1332- 33.

As not ed, t he st andar d t o eval uat e depr i vat i on of

r easonabl e use under t he chart er i s t hat t he pr opert y owner must

est abl i sh an i nabi l i t y t o make r easonabl e use of i t s l and or

bui l di ng wi t hout t he r equest ed var i ance. Kor ean Buddhi st , 87

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Hawai i at 234- 35, 953 P. 2d at 1332- 33 ( appl i cant f or var i ance

f ai l ed t o show t hat i t coul d not make r easonabl e use of t he l and

or i t s hal l ) ; McPher son, 67 Haw. at 605- 06, 699 P. 2d at 28

( accor d) . Kyo- ya appar ent l y di sput es t he appl i cabi l i t y of t hi s

st andar d, ar gui ng t o t hi s cour t t hat Sur f r i der ’ s i nt er pr et at i on

of Kor ean Buddhi st i s mi sl eadi ng and woul d el i mi nat e the

Di r ect or ’ s di scr et i on. However , t he st andar d st at ed i n t he

Char t er ’ s var i ance t est i s cl ear - - an appl i cant has t he bur den of

est abl i shi ng t hat t he appl i cant woul d be depr i ved of t he

r easonabl e use of l and or bui l di ngs i f t he pr ovi si ons of t he

zoni ng code wer e st r i ct l y appl i cabl e. Kor ean Buddhi st , 87

Hawai i at 234, 953 P. 2d at 1332 ( “The bur den of est abl i shi ng t he

f act ual f oundat i on f or [ each pr ong of t he var i ance t est ] r est s

wi t h t he appl i cant . ”) . Her e, t he r el i abl e, pr obat i ve, and

subst ant i al evi dence does not suppor t t he concl usi on t hat t he

var i ance i s necessar y f or Kyo- ya to mai nt ai n economi c vi abi l i t y

of i t s l and or bui l di ng.

ii. PD-R Permit Allowances

The next r eason28 st at ed by t he Di r ect or t o show deni al

of r easonabl e use was t hat Kyo- ya woul d not be abl e t o devel op

28 The second r eason gi ven by t he Di r ect or t o show deni al of r easonabl e use mer el y st at ed t he ef f ect of t he zoni ng code pr ovi si ons on t heProj ect : t he bui l dabl e ar ea of t he DHT l ot woul d be reduced t o l ess t han 35


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i n accor dance wi t h i t s PD- R per mi t i f t he var i ance was not

al l owed. Under a PD- R permi t , an appl i cant can appl y t o t he

Ci t y Counci l and t he Di r ect or f or f l exi bi l i t y f r om speci f i cal l y

enumerat ed provi si ons of t he LUO wi t hi n the WSD upon showi ng

t hat “t i mel y, demonst r abl e cont r i but i ons benef i t i ng t he

communi t y and t he st abi l i t y, f unct i on, and over al l ambi ance and

appear ance of Wai ki ki ar e pr oduced. ” ROH § 21- 9. 80- 4( d) . Whi l e

a PD- R per mi t al l ows an appl i cant t o appl y f or f l exi bi l i t y f r om

r equi r ement s r el at i ng t o densi t y, hei ght , pr eci nct t r ansi t i onal

hei ght set backs, yar ds, open space, and l andscapi ng, t he permi t

not abl y does not al l ow f l exi bi l i t y wi t h r espect t o t he Coast al

Hei ght Set back pr ovi si on.

Ther ef or e, an appl i cant who wi shes t o bui l d a denser ,

t al l er bui l di ng wi t h l ess open space may appl y f or a PD- R per mi t

upon showi ng that t he pr oj ect wi l l benef i t t he communi t y and

cont r i but e t o t he st abi l i t y and over al l ambi ence of Wai ki ki . On

t he ot her hand, an appl i cant who wi shes t o bui l d wi t hi n t he

Coast al Hei ght Set back must appl y f or a var i ance and sat i sf y the

t hr ee r equi r ement s f or i ssuance of a var i ance. By excl udi ng t he

Coast al Hei ght Set back f r om t he l i st of pr ovi si ons t hat may be


percent wi t h a densi t y l ess t han t he exi st i ng DHT and t he Coast al Hei ghtSet back woul d l i mi t t he bui l di ng t o appr oxi mat el y 170 f eet .

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subor di nat ed t o Kyo- ya achi evi ng t he benef i t s of t he PD- R

per mi t .

The ef f ect of coor di nat i ng t he permi t s i n t hi s manner

r esul t ed i n t he ost ensi bl e i ncl usi on of t he Coast al Hei ght

Setback as bei ng among t he pr ovi si ons t hat can be modi f i ed under

t he PD- R per mi t . Thi s i s di r ect l y cont r ar y t o t he i nt ent i on of

t he Ci t y Counci l : t he Coast al Hei ght Set back st ands apar t f r om

t he PD- R per mi t , and an appl i cant seeki ng a var i ance f r om t he

Coast al Hei ght Set back r equi r ement s must i ndependent l y sat i sf y

t he unnecessary har dshi p t est . Accor di ngl y, t he PD- R per mi t

shoul d not have been consi dered as a basi s f or determi ni ng

r easonabl e use i n or der t o sat i sf y t he f i r st r equi r ement of t he

var i ance t est , as i t enabl es ci r cumvent i on of t he Coast al Hei ght

Set back.

Addi t i onal l y, even i f t he PD- R per mi t wer e r el evant t o

t he det er mi nat i on of “r easonabl e use, ” t he Di r ect or not ed t hat

t her e was an al t er nat i ve bui l di ng desi gn t hat woul d achi eve t he

i ncr eased densi t y aut hor i zed by the PD- R per mi t wi t hout

encr oachi ng i nt o t he Coast al Hei ght Set back. 30 Thus, t he

30 The Di r ect or f ound t hat i f Kyo- ya “i s not al l owed t o encr oachi nt o t he coast al hei ght setback, t he bui l di ng desi gn woul d have t o bedr ast i cal l y changed f r om a r el at i vel y t al l , sl ender desi gn t o a shor t er ,wi der bui l di ng wi t h a l ar ger f oot pr i nt i n or der t o achi eve t he densi t ypermi t t ed by t he PD- R. ” ( Emphasi s added) . The Di r ector di sr egarded t heal t er nat i ve desi gn af t er f i ndi ng t hat i t woul d obstruct views from Kalākaua


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Di r ect or expr essl y acknowl edged t hat Kyo- ya coul d i n f act

achi eve t he f ul l densi t y per mi t t ed by i t s PD- R per mi t wi t h an

al t er nat i ve desi gn t hat woul d not encr oach i nt o t he Coast al

Hei ght Set back.

Addi t i onal l y, asi de f r om t he si ngl e “monol i t hi c”

bui l di ng desi gn hypot hesi zed i n t he Di r ect or ’ s Deci si on, t he

Di r ect or di d not di scuss any ot her al t er nat i ve bui l di ng desi gns

t hat woul d not r equi r e a 74 percent encr oachment i nt o the

Coast al Hei ght Setback apparent l y because t here was no evi dence

i n t he r ecor d r egar di ng al t er nat i ves. Thus, i n ef f ect , t he

Di r ector ’ s Deci si on pr esent ed an ar t i f i ci al “ei t her / or ” scenar i o

wher e Kyo- ya coul d onl y bui l d ei t her t he pr oposed Pr oj ect or a

“shor t er , wi der bui l di ng. ” Thi s scenar i o r esul t ed f r om t he

absence of evi dence r egar di ng ot her avai l abl e opt i ons, i ncl udi ng

t he renovat i on of t he exi st i ng DHT, t he const r uct i on of a

compl i ant bui l di ng desi gn, or a bui l di ng desi gn wi t h a gr eat er

degr ee of compl i ance wi t h the Coast al Hei ght Set back.

An appl i cant f or a var i ance i s not depr i ved of t he

r easonabl e use of i t s l and or bui l di ngs si mpl y because the

appl i cant may not be abl e t o ut i l i ze t he maxi mum pot ent i al


Avenue and t hus be cont r ary t o t he WSD obj ect i ves. We addr ess t hi s f i ndi ngwi t h r egar d t o t he t hi r d r equi r ement of t he var i ance t est .

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densi t y of t he si t e. See Kor ean Buddhi st , 87 Hawai i at 234- 35,

953 P. 2d at 1332- 33; Si nger , 29 A. 3d at 150. Accor di ngl y, t he

Di r ect or ’ s di scussi on of t he PD- R per mi t was not r el evant t o t he

anal ysi s of r easonabl e use under t he f i r st r equi r ement of t he

unnecessar y har dshi p t est .

iii. 1965 Beach Agreement

Next , t he Di r ect or f ound that Kyo- ya woul d be deni ed

r easonabl e use of i t s l and because i f t he St at e had const r uct ed

t he beach as r equi r ed by t he 1965 Beach Agreement , “t he si ze and

conf i gur at i on of t he bui l dabl e ar ea of t he si t e woul d be

s i gni f i cant l y di f f erent . ”

I n 1965, t he St at e and cer t ai n shor el i ne pr oper t y

owner s, i ncl udi ng Kyo- ya’ s par ent company, ent er ed i nt o a

pr i vat e agr eement under whi ch t he St ate agr eed t o use i t s best

ef f or t s t o extend the beach appr oxi mat el y 180 f eet seawar d of

t he cur r ent cer t i f i ed shor el i ne. The 1965 Beach Agr eement was

not i ncor por at ed i nt o t he LUO or r ef er enced i n t he pr ovi si ons of

t he subsequent l y enact ed WSD. Whi l e t her e have been beach

r epl eni shment pr oj ect s i n t he year s si nce t he agr eement , t he

beach wi dth envi si oned by the 1965 Beach Agreement was never

r eal i zed. Ther ef or e, t he agr eement had no ef f ect on t he

cer t i f i ed shor el i ne by whi ch t he Coast al Hei ght Set back i s

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measur ed. 31 Kyo- ya, t he Di r ect or , and Fr i ends of Labor

( col l ect i vel y, Appel l ees) ci t e no aut hor i t y t hat woul d aut hor i ze

t he 1965 Agr eement t o have l egal ef f ect on a var i ance

appl i cat i on.

The Appel l ees cont end t hat t he Di r ect or di d not r el y

on the 1965 Beach Agreement t o det er mi ne whet her Kyo- ya woul d be

deni ed reasonabl e use; however , t he pl ai n l anguage of t he

Di r ect or ’ s Deci si on i ndi cat es ot her wi se. 32 I n i t s var i ance

appl i cat i on, Kyo- ya acknowl edged t hat t he shor el i ne was never

extended pursuant t o t he t erms of t he 1965 Beach Agreement yet

cont ended t hat i f t he beach had been ext ended, “al most no

por t i on of t he [Pr oj ect ] woul d encr oach i nt o the Coast al Hei ght

Set back. ” The Di r ect or adopt ed Kyo- ya’ s r easoni ng i n hi s

deci si on and concl uded t he var i ance, “vi ewed i n [ t he cont ext of

t he 1965 Beach Agr eement ] , i s not excess i ve. ” ( Emphasi s added) .

Addi t i onal l y, af t er t he Di r ect or had ext ensi vel y di scussed t he

31 See not e 3 f or t he def i ni t i on of “cer t i f i ed shor el i ne. ”

32 Kyo- ya ar gued t o the Di r ect or , t he ZBA, and t he ci r cui t cour tt hat t he 1965 Beach Agr eement conf er r ed upon i t cer t ai n r i ght s andexpect at i ons t hat must be consi dered i n determi ni ng what r easonabl e use Kyoya coul d expect of i t s pr oper t y under t he var i ance t est . Kyo- ya al socont ended t hat t he agr eement “al t er ed r eal pr oper t y l aw as i t appl i ed t o the

Moana Par cel and t he ‘ bundl e of l egal st i cks’ t hat [ Kyo- ya] hel d as i t spr oper t y. ” Dur i ng t he var i ance appl i cat i on pr oceedi ng, Kyo- ya mai nt ai nedt hat “t he Di r ect or was r equi r ed t o consi der t he shorel i ne t hat t he St at e of Hawai i i s absol ut el y l egal l y obl i gat ed t o mai nt ai n f or t he benef i t of Kyo- yaand i t s adj oi ni ng l andowner s ( and t he gener al publ i c) ” and t hat i f t heDi r ect or had done so, “t her e woul d have been a mor e permi ssi ve var i ancei ssued. ”

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Beach Agr eement , t he Di r ector f ound t hat “[ f ] or t hese and other

r easons, i t can be r ecogni zed t hat [ Kyo- ya] woul d be deni ed

r easonabl e use of t he si t e i f not al l owed t o encr oach i nt o the

[ Coast al Hei ght Set back] . ” ( Emphasi s added) .

By pl aci ng si gni f i cant r el i ance on t he 1965 Beach

Agr eement as a basi s f or i t s concl usi on t hat Kyo- ya woul d be

deni ed r easonabl e use i f encr oachment was not al l owed, t he

Di r ect or ef f ect i vel y eval uat ed t he r easonabl e use of Kyo- ya’ s

pr opert y i n t erms of t he wi dt h of t he beach i nt ended by t he 1965

Beach Agr eement . Ot her st at ement s i n t he Di r ect or ’ s Deci si on

f ur t her suppor t t he concl usi on t hat t he Di r ect or r el i ed on t he

1965 Beach Agreement t o deter mi ne whet her Kyo- ya woul d be

depr i ved of r easonabl e use of i t s l and.

For exampl e, af t er r ef erenci ng t he 1965 Beach

Agr eement , t he Di r ect or st at ed, “A cl oser l ook at t he 1965

Agr eement suggest s t hat i f t he St ate had const r uct ed t he beach

as r equi r ed, t he si ze and conf i gur at i on of t he bui l dabl e ar ea of

t he si t e woul d be si gni f i cant l y di f f er ent , ” “t he beach f r ont i ng

t he [ Pr oj ect si t e] mi ght be as much as 180 f eet wi der t han i t i s

t oday, ” and t hus “t he bui l di ng set back and hei ght en

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Surfrider Foundation v. Zoning Bd. of Appeals, No. SCAP-13-0005781 (Haw. Sep. 23, 2015)

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