Thousands of Native Hawaiians are set to receive financial compensation from the state in a historic breach-of-trust case recently decided by Hawai?i?s Supreme Court. A court-appointed special master will determine what damages are owed the plaintiffs after years and even decades-long waits for Hawaiian homesteads. Much of the calculation depends on the cost of a parcel of land in M??ili, O?ahu.
Courts often face challeges in calculating damages in complicated class-action lawsuits like the homestead case, also known as the Kalima lawsuit. An obvious choice would be to base compensation on the cost of rent for “X” amount of years. But it?s not that simple, says attorney Carl Varady. He and Tom Grande are co-lead counsel for the plaintiffs in the suit.
“Because these claims go back decades, few people will have receipts, especially if they were living with family or poor and living on the beach, houseless, etc.,” says Varady. “The people who were most impoverished and need the benefits of homesteading the most are the least likely to have proof. And I think the court recognized that.”
The Hawai?i Supreme Court ruled that the state breached its trust duty to Native Hawaiian beneficiaries of the Hawaiian Home Lands Trust by not awarding homestead lots in a timely manner. The land trust was established by Congress in 1921 to provide homestead lots to those of 50 or more percent Native Hawaiian blood. The state currently has nearly 10,000 beneficiaries on Hawaiian homestead lands with another 27,000 and more on the waitlist.
The state Supreme Court ruled last week that the claimants in the Kalima case will not be required to present proof of housing expenses to receive compensation. Instead, damages will be based on the fair market rental value of a residential lot in M??ili on any given year -- a method Varady calls the M??ili measure.
“So, for example, if someone applied in 1975 and received an award in 1989, the fair market rental value for that time period would be the value of their claim,” says Varady.
He says it's difficult to come up with a ballpark figure for the total amount because land values fluctuate each year. Varady says folks who applied later will likely receive more money because land values have gone up over time. But why M??ili?
“It was accepted that this was a reasonable measure rather than picking something at the higher end of the market -- you know, a lot in Kahala by way of example,” says Varady. “M??ili was chosen because it?s a conservative measure and could be used as a valuation, not only for O?ahu but neighbor island residential properties as well.”
Reconciling differences over damages has been the focus of the case for the past 11 years. Varady says more than 400 plaintiffs have died since the lawsuit began in 1999. Raynette Ah Chong?s father, Joseph Ching, was one of those plaintiffs. He applied for Hawaiian homes in 1962 and died in 2001 with no homestead.
“When I came into this, I didn?t know what my dad was doing,” says Ah Chong.
The 59-year-old Kahalu?u resident took her father?s place in the lawsuit and is determined to see it through.
“They ruled in our favor so they ruled that we are entitled to the damages and the state is liable. However, that?s the ruling. Now we gotta get to the next step,” says Ah Chong. “So it?s not over yet. This is going to take a while.”
Varady says descendants of deceased claimants are eligible to receive damages. The next step is for the court-appointed special master to evaluate each and every claim and make a recommendation for the courts to ultimately decide.
