United States District Court, D. Hawaii
MICHAEL SAKATANI; 808 FARMS LLC; KURTIS L. DERELL; AND CAROL H. JUNG, Plaintiffs,
CITY AND COUNTY OF HONOLULU, HAWAII; CITY AND COUNTY OF HONOLULU DEPARTMENT OF PLANNING AND PERMITTING; DIRECTOR OF CITY AND COUNTY OF HONOLULU DEPARTMENT OF PLANNING AND PERMITTING; JOHN DOES 1-10; JANE DOES 1-10; DOE GOVERNMENT ENTITIES 1-10; DOE CORPORATIONS 1-10; DOE PARTNERSHIPS 1-10; and DOE ENTITIES 1-10, Defendants.
ORDER GRANTING PLAINTIFFS' MOTION TO
A. Otake United States District Judge
case concerns a dispute over whether the City and County of
Honolulu (“the City”) is required to issue sewer
and building permits to Plaintiffs 808 Farms LLC, Michael
Sakatani, Kurtis L. Derell, and Carol H. Jung
(“Plaintiffs”). After being denied sewer and
building permits for the development of their properties,
Plaintiffs filed suit in state court asserting state law,
federal takings, and due process claims against the City, its
Department of Planning and Permitting (“DPP”),
and the Director of the DPP (collectively
“Defendants”). Defendants removed the case on
federal question jurisdiction. Now before the Court is
Plaintiffs' motion to remand pursuant to Railroad
Comm'n of Tex. v. Pullman Co., 312 U.S. 496 (1941).
After careful consideration of the parties' submissions
and argument, for the reasons set forth below, the motion to
remand is granted.
own parcels of undeveloped residential-zoned land on Papahehi
Place in Honolulu. Doc. No. 1-2 at ¶¶ 1-2. Both
parcels suffered from flooding and ground movement in the
1980s, which damaged portions of Papahehi Place. Id.
¶¶ 17, 27. According to the Complaint, the Housing
and Community Development Corporation of Hawaii
(“HCDCH”),  a public agency, purchased the parcels
of land after the flooding and ground movement had damaged
the properties. Id. ¶ 17. On October 3, 2005,
the HCDCH granted the properties by quitclaim deed
(“the 2005 Quitclaim Deed”) to Metropolitan
Maintenance, Inc. Plaintiffs subsequently purchased the
properties. Id. ¶¶ 1, 13, 14, 16.
Plaintiff 808 Farms, through its agent Plaintiff Sakatani,
purchased its parcel of land by warranty deed on March 2,
2016. Id. ¶¶ 1, 13. Plaintiffs Darell and
Jung co-purchased their parcel of land by warranty deed on
August 25, 2016. Id. ¶ 14.
warranty deeds are subject to the “terms and
conditions” of the 2005 Quitclaim Deed. Id.
¶¶ 13-14. The 2005 Quitclaim Deed states that the
purchasers recognize and accept the purchase of land in an
“as is, where is” condition; that the grantor of
the property has made no warranties or representations as to
the suitability of the property for any use or as to the
physical condition of the property; and that the purchaser is
not relying on any representations or covenants about the
condition of the property (the “As Is Clause”).
Id. ¶ 18. The 2005 Quitclaim Deed also states
that the purchaser acknowledges that the property has been
subject to ground movement and continues to move.
2015, prior to Plaintiffs Darell and Jung purchasing their
property, the DPP issued what Plaintiffs describe as a
conditional approval for a sewer connection. Id.
¶ 20. The conditional approval stated that to receive a
sewer connection permit, Plaintiffs needed to submit: (1)
construction plans for review and approval; and (2) a
geotechnical report to (a) confirm that there was no ground
movement and (b) determine the proper design and construction
to protect new sewer lines from future ground movement.
Id. Plaintiffs Derrel and Jung assert that they
purchased the property in reliance on the conditional
approval, expecting that a sewer permit would be granted if
they met the conditions stated. Id. ¶ 21.
Plaintiff 808 Farms did not receive a conditional approval.
Id. ¶ 23.
sets of Plaintiffs applied for sewer connection permits.
Id. ¶¶ 22-26. They each submitted a
geotechnical report showing that there was no detectable
ground movement. Id. ¶¶ 22, 25. Plaintiffs
Derrel and Jung also submitted construction plans for their
sewer connections in compliance with the conditional
approval. Id. ¶ 22.
February 2016, DPP denied 808 Farms' sewer connection
application because the State had determined there was ground
movement in the area, and that ground stability had not been
established. Id. ¶ 23. The denial stated that
the Hawai‘i Housing Financial Development Corporation
(“HHFDC”) “noted that no dwellings shall be
constructed on the subject lot.” Id.
Subsequently, in a letter to Plaintiffs Derell and Jung on
May 4, 2017, and in a letter to Plaintiff Sakatani on August
22, 2017, DPP informed Plaintiffs that it would not issue
sewer connections or building permits until the HHFDC had,
upon cessation of ground movement, repaired the damage to
Papahehi Place and installed new utility and sewer lines.
Id. ¶ 26. The denial letters also stated that
the “As Is Clause” of the 2005 Quitclaim Deed
established that no warranties or representations were
provided regarding the suitability of the property for any
particular use. Id. The Complaint alleges that
contrary to the DPP's denial of Plaintiffs' sewer
applications, the DPP has issued sewer permits to other
property owners on Papahehi Place, allowing them to construct
residences in the area. Id. ¶ 28.
August 3, 2018, Plaintiffs sued Defendants in state court.
Doc. No. 1-2. Plaintiffs assert causes of action for
declaratory relief (Count I) to declare that DPP must issue
sewer and related building permits; for injunctive and
mandamus relief (Count II) to require DPP to issue sewer and
related building permits; for estoppel and vested rights
(Count III) asserting that the City cannot deny them sewer
connection permits after giving Plaintiffs a conditional
approval on which they relied; for violation of due process
rights under the United States and Hawai‘i
Constitutions (Count IV); for inverse condemnation under the
United States Constitution (Count V); and for violation of 42
U.S.C. § 1983 (Count VI). Id.
August 28, 2018, Defendants removed the case to this Court on
the basis of federal question jurisdiction. Doc. No. 1. On
August 31, 2018, Defendants moved to dismiss the Complaint
for failure to state a claim upon which relief could be
granted. Doc. No. 5. On September 24, 2018, Plaintiffs filed
the present motion to remand the case back to state court
under the Pullman abstention doctrine.
Pullman abstention doctrine was first established in
Railroad Commission of Texas v. Pullman Co., 312
U.S. 496 (1941). The doctrine authorizes federal courts to
abstain from adjudicating federal constitutional challenges
when a sensitive issue of state law would moot or narrow the
federal issue and allows a state court to address the state
law issue first. See, e.g., Pullman, 312
U.S. at 501; Haw. Hous. Auth. v. Midkiff, 467 U.S.
229, 236 (1984). The doctrine provides federal courts with a
way to “avoid both unnecessary adjudication of federal
questions and ‘needless friction with state
policies.'” Midkiff, 467 U.S. at 236
(quoting Pullman, 312 U.S. at 500). Thus,