Hawaii Supreme Court: Beachfront Property Is Worthless

by Robert Thomas, Inverse Condemnation, October 6, 2025

In a case we’ve been following for what seems like forever, the Hawaii Supreme Court has issued an opinion in Maunalua Bay Beach Ohana 28 v. State of Hawaii, No. SCWC-19-0000776 (Sep. 17, 2025), holding that littoral property owners are owed nothing for the temporary regulatory taking of small portions of accreted beach.

Act 73 Takes Accreted Beachfront Property

After a long fight, the property owners obtained a favorable liability verdict from the trial court, which was affirmed by the court of appeals. So far, so good.

The case goes all the way back to a statute the Hawaii Legislature adopted in 2003, which made certain land accreted on littoral private property public land. As the court put it, “Act 73 prevented anyone other than the State from registering or quieting title to accreted lands, except where that accretion restored eroded lands.” Slip op. at 4.

Sounds like a taking, and sure enough a lawsuit followed, claiming that the ipse dixiting of accreted land was a taking because it represented a change in the common law under which the adjacent owners would own the accreted land. Nine years later, the legislature amended the statute which effectively terminated any taking.

The trial court dismissed the takings claim, but the court of appeals held that the statute worked an uncompensated taking of the land accreted before the effective date of the statute. (The court rejected a claim that the statute also confiscated future accreted land, but that is another story.) The appeals court sent the case back for a ruling on whether these plaintiffs own land that qualified, and if so, the valuation of the accreted land.

After a bench trial, the court correctly concluded that there was a temporary (nine year) taking, not a permanent one. The parties stipulated that just compensation was to be measured by the fair rental value of the accreted land as of the effective date of the statute, subject to the governmental and private restrictions that burdened the land. After considering the parties’ evidence which included testimony from appraisers, the trial court concluded that just compensation is $0. 

The court of appeals affirmed, concluding the the verdict was based on the trial court’s view of the relative credibility of the appraisers, and if the trial court saw the property owners’ appraiser as less credible than the State’s, then that was that.

If The Trial Court Believes Their Appraiser and Not Yours, You Are Probably in Trouble

The owners asked the Hawaii Supreme Court to review the decision: beachfront property in Hawaii in one of Oahu’s most tony neighborhoods could not be worth nothing, could it? Even nominal just compensation or severance damages should be awarded, right?

The Hawaii Supreme Court held no. Yes, “Act 73 effected a taking of the Ohanas’ accreted lands.” Slip op. at 14. Zero dollars in just compensation is just fine. The supreme court, like the court of appeals, fell back on the testimony and evidence, and applied the appellate standard of review to conclude that the trial court’s factual and credibility determinations were not clearly erroneous or an abuse of discretion. The parties had stipulated that just compensation would be calculated by the fair market rental value, and “[a]fter hearing testimony from dueling experts as to the fair rental value of the property, the [trial] court determined that the Ohanas were entitled to just compensation in the amount of zero dollars.” Id.

No Nominal Damages, Because No Constitutional Violation

As for nominal damages (an argument likely pressed here by the property owners because a finding of nominal damages would make the plaintiffs the prevailing party, triggering recovery of attorneys’ fees), the court held that even though “the Ohanas were able to prove that there was a temporary taking” under the Hawaii Constitution, slip op. at 19, the injury in a takings case is not the taking itself, “but rather an entitlement to just compensation.” Slip op. at 20. Thus, there’s not even a “technical injury,” which is the usual trigger to nominal damages:

Here, the Ohanas were able to prove that there was a temporary taking under article I, section 20 of the Hawaii Constitution. Maunalua Bay I, 122 Hawaii at 57, 222 P.3d at 464 (“Act 73 effectuated a permanent taking of littoral owners’ ownership rights to existing accretions to the owners’ oceanfront properties that had not been registered or recorded or made the subject of a then-pending quiet-title lawsuit or petition to register the accretions.”). “A takings claim seeks compensation for something the government is entitled to do; a taking is not a legal injury, but rather an entitlement to just compensation.” See DW Aina Lea, 148 Hawaii at 404, 477 P.3d at 844. As the ICA in Maunalua Bay II properly concluded, “[the Ohanas] did not sustain a ‘technical injury due to a violation of some legal right[.]’ Kanahele, 125 Hawaii at 457–58, 263 P.3d at 737–38. They were not entitled to nominal damages.” Maunalua Bay II, 154 Hawaii at 152, 547 P.3d at 1182. Instead, the proper remedy for a takings claim is just compensation. DW Aina Lea, 148 Hawaii at 404, 477 P.3d at 844.

Yes, the State took the accreted property, but it didn’t have to provide just compensation because the property was valueless. No comp, no constitutional injury.

No Surprise: No Private Attorney General Fees, Either

The court also rejected the owners’ claim that they were entitled to recover attorneys’ fees under the private attorney general doctrine. Under the court’s previous rulings, plaintiffs who challenge the government and obtain a ruling that benefits the public may be entitled to recover fees. The Hawaii Supreme Court has de facto limited that doctrine to cases in which environmental plaintiffs (or similar) win cases, and not where property owners vindicate their rights.

The court held that although the State might not enjoy immunity for just compensation (an issue it declined to address, see slip op. at 25), it does for private attorney general fees, and the Hawaii Constitution’s takings clause has not waived that immunity in inverse condemnation claims.

The court relied on a prior decision which held that attorneys fees are not part of just compensation and the because the State has not separately waived sovereign immunity for fees in eminent domain cases.

In State v. Davis, we considered whether our Takings Clause waived sovereign immunity in direct condemnation actions. 53 Haw. 582, 499 P.2d 663 (1972). We concluded it did not. Id.at 587, 499 P.2d at 667-68. At the time, article I, section 18 of the Hawaii Constitution contained our Takings Clause, which provided “Private property shall not be taken for public use without just compensation.” Noting that the definition of just compensation adopted by this court “contains no reference to attorneys’ fees or litigation costs,” we held, “in accordance with the overwhelming weight of authority that attorneys’ fees and expenses, including expert witness’ fees, are not embraced within the meaning of ‘just compensation’ for purposes of article I, section 18 of the Hawaii Constitution.” Davis, 53 Haw. at 587, 499 P.2d at 667-68. -- Slip op. at 25-26 (footnote omitted).

If the court isn’t going to recognize a waiver in straight takings claims, you can pretty much guess that it won’t be willing to do so in inverse cases:

This court did not address the whether then article I, section 18 waived sovereign immunity for attorneys’ fees in inverse condemnation cases. Nonetheless, because our reasoning in Davis applies equally to direct condemnation and inverse condemnation cases, and in the absence of authority to the contrary, it would be incongruent to read just compensation to include inverse condemnation but not direct condemnation actions. We therefore conclude that the Hawaii Constitution prior to the 1968 amendment had not waived sovereign immunity for attorneys’ fees in inverse condemnation cases. -- Slip op. at 27.

The court also concluded that the addition of a “damagings clause” to the Hawaii Constitution in 1968 didn’t change that. Damagings are severance damages, not attorneys’ fees:

“[O]r damaged” certainly encompasses a broader range of situations meriting just compensation than had been previously contemplated, and its inclusion was clearly intended to remedy the perceived inadequacies of our then-existing Takings Clause. Nevertheless, nothing from the proceedings indicates that attorneys’ fees would be recoverable. “[O]r damaged” merely allows for just compensation for property damage caused by government actions that do not rise to the level of a taking, such as diminution in value. -- Slip op. at 30-31.

Will this decision bring the long saga to an end? Probably so, but you never know.

PDF: Maunalua Bay Beach Ohana 28 v. State of Hawaii, SCWC-19-0000776 (Haw. Sep. 17, 2025)