Case Title: Save Diamond Head Waters, LLC v. Hans Hedemann Surf, Inc. ICA Opinion, filed 12/19/2008 [pdf], 119 Haw. 452. Application for Writ of Certiorari, filed 02/05/2009. S.Ct. Order Accepting Application for Writ of Certiorari, filed 03/16/2009 [pdf].

Citation: 121 Haw. 16

Docket Number: 

State: hawaii

Court: Hawaii Supreme Court

Date: 2009-07-13T00:00:00Z

Document:
LAW LIBRARY

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OF HAWAI'I

 

IN THE SUPREME COURT OF THE

 

‘000-==

 

RS LLC. a Hawaii limited

 

SAVE DIAMOND HEAD Wi
KAPIOLANI PARK PRESERVATION SOCIETY,

liability corporation;
LUC, a Hawaii limited liability corporations MIKE
an indi

BEASON,

 

and RICHARD K. QUINN,

‘an individual
rs /Rppellants-Appellees,

Petiti:

 

 

 

HANS HEDEMANN SURF, INC.
Respondent /Appellee-Appeliant,

=
co

SOHIKY CF nega

 

and

CITY AND COUNTY OF HONOLULU, by and through the
DEPARTMENT OF PLANNING’ AND PERMITTING,
Respondent /Appellee-Appellee,

and

McINERY FOUNDATION, a Hawaii corporation; and

HOTEL KAIMANA, INC., a Hawaii corporation,
Respondent s/Appellees-Appellees.

 

Waters,

Beason;

No. 27604

CERTIORARI TO THE INTERMEDIATE COURT OF APPEALS
(CIV. NO, 5-1-1145)

JULY 13, 2009

MOON, C.J., NAKAYAMA, ACOBA, AND DUFFY, JJ., AND
CIRCUIT JUDGE ALM, ASSIGNED’ BY REASON OF VACANCY

OPINION OF THE COURT BY DUFFY,
Petitioners/Plaintifts-Appellees Save Diamond Head
, LLC; Kapiolani Park Preservation Society, LLC; Mike

ollectively SDHW) filed a timely

 

and Richard K. Quinn

Application for Writ of Certiorari (Application) urging this
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court to review the January 9, 2009 judgment of the Intermediate

Court of Appeals (ICA) based on its Opinion in Save D

Waters, LLC, V. Hans Hedemann Surf, Inc. (SDHW), No. 27804, 119
Hawai'i 452, 198 P.3d 715 (App. 2008). The ICA’s Opinion

lead

reversed the circuit court of the first circuit's! (circuit
court) April 19, 2006 Amended Final Judgment on Administrative
Appeal, Vacating and Modifying Decision of the Zoning Board of
Appeals Matter Number 2004/28A-04.

In its Application, SDM presented the following

questions:

1. Must a reviewing court use the de nove standard of
review to ascertain the scope of authority granted to
an administrative agency by a legislative body?

2. Goes an acministrative agency (here the [Department of
jernitting and Planning ("DE?)]} have the power to

{ft and interpret administrative rules in » fashion
contrary to the plain language of the governing
ordinances?

3. Must an administrative agency apply exieting statutory
standards when exercising its quasi-judicial function
or ray st ignore such standarde and craft new
Steasonable” standards?

4, Must the reviewing courts coneider and apply the
statutorily imposed standards in reviewing the quasi-
Judicial determinations of the agency?

5. Does an administrative agency exceed ite power by
conditioning a zoning variance on the applicant
lundertaking to fulfii1 a public police function, such
5 maintaining order on a seawall hundreds of yards
from the applicant’ s premises?

 

      

 

 

We accepted SDHi”s Application on March 16, 2009, and

oral argument was held on May 7, 2003.

‘The Honorable Eden Elizabeth Hifo presided.

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For the following reasons, we (1) vacate the ICA's

 

opinion and (2) affirm the circuit court's amended final judgment
fon the grounds that the Director's mixed finding of fact and
conclusion of law that the Hans Hedemann Surf, Inc.'s (Surf
School} use of the New Otani Kaimana Beach Hotel's (Hotel)

premises was a permissible change in nonconforming use was

clearly erroneous as it is not supported in the record,

 

BACKGROUND

AL Factual Backaround

The ICA set forth the following facts in its opinion:

 

Hedonann operates Hans Hedenann Surf School (Surf School], 2
commercial surfing school, at four O'ahu locations. This
Sispute relates te the surf School Located on the ‘ground
Floor (Shop #7) of the Hotel. The Hotel consists of 124
Unies and ts situated on WalkrkI beach, in che ares makas'"!
Of Kapiolani Fark and Kalakaus Avenue ‘and between Kaimana
Beach Park on the “Eval” side and various other properts

fon the opposite side.

 

 

 

 

The Hotel was constructed in 1950 and expanded in
1962, At the time it was built, the property underlying the
Hotei was toned as pare of the fotel and Apartment Oletriet
SL." This zoning district dia not allow for comercial uses
other than businesses that primarily served the tenants and
Occupants of the bulldings in unich they were located, know
a5 “accessory uses.”

 

# ~*Makait is a Hawaiian word meaning ‘on the seaside, toward the sea,

in the direction of the sea,’” OAM, 119 Hawai'i ar 455 n.3., 198 P.34 at 118
nl3. (quoting Mary Kawona Fukui, Sanuél #, Elbert, Hawaiian letionary, 224
(rey. ed. 1986)!

   

 

“'Ewa’ is a “{p]iace name wast of Honolulu used as a direction
kerm.’” SOM, 128 Hawaili ae 455 nev 198 B.3d at 716 n-4 (quoting Hawaiian
Dictionary at 42)

   

At the tine the Hotel was expanded, business uses were prohibited
within hotel and apartment districts, Revised Ordinances of Honolulu (ROH) 5
2is3. (1557). However, accessory uses were permitted 28 follows:

   

 
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On January 2, 1969, the Comprehensive Zoning Code tock
effect. This placed the Hote! inte an Aud Apartment
District, whien did not allow hotels, “Again, only accessory
Gcanercial uses were permitted in buildings contaccing a
Biniman of $0 dvelling or lodging unite and no external
evidence of the existence of the accessory uae was
permissible

 

on Decenber 23, 1982, Ordinance £2-58 (the Land Use
Ordinance (400) codi fied ax ROH Chapter 21) changed the
zoning of the Hotel to ite current Av? Medium Density
Apartrent District designation. Hotel and accessory uses
fare not permitted in Ac? districts. However, because hotel
Use Was acceptable at the time of the Hotel's construction

 

 

 

(Clertain accessory uses incidental to and customarily
conducted within hotel and apartment districts shall be
permitted and allowed, provided they are in compliance with
Sil existing laws, ordinances, and Fegulatione spplicable
thereto. The form accessory uses” shal include, without
Liniting the generality of ts meaning, restaurants, barber
‘shops, Beauty parlors, massage studioe, haberdasheries,
Wearing apparel shops, flower shops, newestande, gift shops
and other personal service shops

 

 

 

 

ROH $ 21-3.1(a). Accessory uses were limited to apartrents and hotels with
ore than twenty rooms. RON § 21-3.1(a) (1)- Additionally, the “personal
shops and businesses shall be operated prinarily as a service to and for the
Convenience of the tenants and occupants of the building in which such

srvices are located(.)" KOM § 21-3.1(a) (2). Further, no doors, entrances,
signs, adverticanents, or displays could be locates on the exterior of she
Baildings. ROW § 21-3.1(a) (3)~(4) +

 

follow

 

“Accessory use" is currently defined

 

“Accessory use” means a use which meets the following conditions

(1) Tea use which is conducted on the same zoning let as the
principal use to which it is related uhether located within

 

fhe same building or an accessory building or structure, oF
a5 an accessory use of Lend)
(2) 2s clearly incidentat to and customarily found in connection

with the principal usey and

(3) Te operated and maintained substantially for the benefit or
convenience of the cuners, occupant, employees, custoners
of visitors of the zoning lot with the principal use.

 

Land Use Ordinance {100} § 21-10.1 (1990),
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land the Hotel has continued to b
Survives cea nonconforming use.

 

used as @ hotel, hotel use

The record is unclear as to when the Hotel's use of
Shop #7 ended and its use for commercial purposes began. As
early as. 1993, other commercial tenants used shop #) to rent
fut kayaks, body boards, ‘surfing and other seach equiprent
‘The record fails to establish wnether the prior rental
businesses constitutes an accessory use ora non-accessory
se, iver, whether the customers of these Basineases were’
prinarily’notel guests or the general public.

 

    

Hedesann began renting Shop #7 en January 1, 2002.
Hodemann both rents and sells equipment bot primarily wes
fhe space aa “an assembly point for its clients.” A
Scubstantiai partion” of Hedenann’ s custoners are Brought
the location via shuttle from other Waikiki locations. At
Shop #7, students are iseved surfboards and they use the

    

 

Hotei's’ property outside Shop #7 to reach the ocean, where
Surfing Lessons are conducted.”
Although shop #7 had been previously used to rent

 

ocean equipment, Hedensnn's use Sf Shop #7 genezates
“widespread Local opposition.” Tt ia onclear from the
record when that opposition began, but a petition signed by
approximately 700 people objecting to the Surf Schools
activities was submitted during these proceedings. Zn.
Particular, area residents conplained of noise, congestion,
Parking issues, vandaiion, erespassing and “other ili:
Eaused by the Surf school

   

 

* At the time the LUO changed the zoning of the Hotel, “a
nonconforming use” was defined a5

Any use of 2 structure or zoning lot which waa previously
Lawful but which does not conform to the applicable use.
regulations of the district in whicn it is loceted, either
fon the effective date of this Chapter or as a result of any.
Subsequent anendnent

wo Art, IX, (1983 ed.)

The current definition of “a nonconforming use” ss:

 

‘Nonconforning use" means sny use of a structure or a roning
ot which was previously lawful but hich does not conform
to the applicable use regulations of the district in which
it ig Located, either on October 22, 1986 or az a feault of
lany subsequent amendment to this chapter [LUO], or 2 zoning
nop amenament

 

 

wo $ 21-10.1,
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‘SOHW, 119 Hawai'i at 454-56, 198 P.3d at 717-19 (some footnotes
omitted).
B. The Director's Declaratory Ruling

On March 4, 2004, SOHW filed a petition for a
declaratory ruling from the Director of the City and County of
Honolulu Department of Planning and Permitting (DPP) on whether
the Surf School “operates in compliance with the regulations of
the zoning ordinance for nonconformities.” In beginning his
analysis, the Director set forth the provisions of the Land Use
Ordinance (LUO) that relate to nonconforming uses. He quoted LUO
§ 21-4.110(c) (1), which states that

A nonconforming use shall not extend to any part of the
Structure or lot which wae not arranged or deeigned for euch
Use at the tine of adoption of the provisions of thie
Chapter or subsequent anenanent; nor shall she nonconforming
lise! be expanded in any manner, of the hours of operation
Increased: Notwithstanding the foregoing, a recrestionsl
lise that is accessory to the nonconforming use may Be
expanded or extended if the following conditions are met:

 

 

 

() The recreational accessory use will be expanded ox
extended to a structure in wnich a permitted use aso
{S'being conducted, whether that structure is on the
sane lot or an adjacent lot; and

(B) The recreational accessory use is accessory to both
the perritted ee and the nonconforming wee.

The Director then quoted LUO Sec. 21-4.110 (c) (4), which governs
changes in nonconforming uses, states that

Any nonconforming use may be changed to another
Ronconforming use of the same nature and general impact, ox
to a more restricted use, provided chat the change toa nore
restricted use gay be sade cnly if the relation of the use’

Xo_she surcounding property ie auch thet adverse effects on

‘Bocubants and -nelanbarina progert ies Mil nat oe srester
shat_if the ofiains! nonconforming use contanued.

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(Emphasis in original.)

The Director firat found that the Surf School was not
an accessory use of the Hotel because “{mjost of the students are
not guests of the on-site hotel.” See LUO § 21-10.1 (" ‘Accessory
use’ means a use which . . . [i]s operated and maintained
substantially for the benefit or convenience of the owners,
cccupants, employees, customers or visitors of the zoning let
with the principal use."). Rather, the Director concluded that
“the use should be considered an ‘office’ since the primary on-
site activity is the assembly and registration of students and
the distribution of surf boards to then.”

‘The Director further found that the Surf School was not
an expansion of a nonconforming use prohibited by LUO §
21-4.110(c) (1). He reasoned that the Surf School did not involve
“a new structure or the physical expansion of an existing

structure” and the hours of the surf school -- 8:30 a.m. to

 

 

Pom. == could not be considered an expansion of the Hotel's
‘twenty-four hour operation. Instead, the Director found that
“the establishnent of a surf school on the site more properly
represents a ‘change in use,’ rather than an ‘expansion’ of the

nonconforming us

 

To frame his analysis of whether the Surf School was a

permissible change in nonconforming use, the Director stated that
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current soning regulations clearly permit changes in
nonconforming use under LUO Section 21-¢.110(e) 14), provided
‘the change in use does not result in greater adverse effects
for occupants and neighboring properties. This means that
any of the ground-flocr commercial uses on the site
Considered principal uses, including the surf school,
Permissible so long as their impact on surzcunding
Properties is no greater than that of the hote! use,

   

 

    

 

‘The Director Limited the adverse effects under consideration to
the “adverse effects on the various land uses within the
neighborhood, including the seawall, rather than on the ocean

itself.” The Director noted that “(t]he LUO does not stipulate

 

criteria that must be applied to changes in nonconforming use in

order to determine whether a greater adverse effect will occur,

 

80 changes in nonconforming use must be evaluated on a
case-by-case basis.” As a result, he analyzed the nonconforming
use issue according to the framework provided by “Interpretation
No. 88/INT-6, issued by the DPP on December 19, 1988, [which]
addresses how changes in nonconforming use can be evaluated by
providing guidelines for decision-making on whether a proposed
change in use may involve greater adverse effects.” The

interpe
fon how to defin

 

ation number £8/INT-6 (Decenber 19, 1986) provid
‘sane nature” and "more restricted use":

 

guidance

 

Each change in use shall be evaluated on a case-by-case basis,
ting the following guidelines for decision-making?

Hours of operation Are the hours longer or changed in 9
Way which say create conflicts with
Surrounding conforming uses?
Chientele volume Are nore clients or visitors
Gxpectes to be attracted to the
site?
the parking standard higher, or
the parking demand expected to be

 

 

Parking

 

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following portions of the Director’s analysis are most relevant

to the dispositive issue of this appea:

School's use of the Hotel's premises was a permissible change

whether the surt

 

 

nonconforming use under the LUO. As analyzed by the Director:

eestNt-6

2. GLdentele Volume: Information available to the DFP
Concerning tne hanber cf sur! school customers
(students) indicates that class size varies greatly.

 

For purposes of this Analysis,

‘Sci school cpersting on the araunds of the note:

should be _nodreater than iit operated a2 an
‘Aocessary use of the hotel At issue then Te the
Tevet of activity or intensity of ase which results in
Greater adverse effects. OPP staff observed no
Significant impacts associated with the surf school
ietivities on the morning they conducted their site
Sisit. At that time, there were only 4 students in
the class. “On the other hand, @ large nunber of
Complaints from area residents, over a sustained
period of tine, clearly indicates that there are
Bdverse effects associated with the surf school's
activities, particularly when class size is Large.
Relevant sulsances include noise (shouting and
yelling) and congestion at the seawall. further, it
would be difficuit to find that a class savolving 30
£0150 students would be typinal for sn accessory use
sia l2éunit note).

 

 

 

higher?

Traffic Will" the new use attract heavier
vehicles or greater frequency of
vehicle ceips?

Noise Te more noise expected? During aight
hours?

Compared to the previous

non-conforming use, is the proposed

Use compatible with existing

Surrounsing uses? Wish conforming

Adjacent

 

Nonconforming commercial accessory uses in Waikiki would be
allowea to continue even if the Duilding is converted ts
apartment. us

 

 

oacenber 19, 1988)
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‘The DPP is not aware of any historical adverae effects
associated with the operation of the nonconforming hotel on
the site similar to those associated with the surf school
Felative to noise, seawall congestion, and tncompatibilitii
With surrounding and conforming uses on the properties in
the surrounding neighborhood. the relationship between the
surf schosl and these adverse effects are apparently
Associated with large surfing class site, and should be
Controlled by limiting class size. If the adverse effects
Gan be controlied by limiting clase sie, than she sure
achool's activities should aot have an inpact areater than
i itns| curt schesl cperated ae accectory ase of the hotel.
The clase site should be Limited to no more than Tz students
er Session, and no more than 3 sessions per day. The surf
School operator should also take appropriate actions te
Binimize congestion along the seawell edjacent to the
Shoreline in the vicinity of ite activities during the
periods of ita surfing insteuction.

 

 

 

 

Finally, it is the operator's responsibility to comply with
these Controls. Failure to comply may necessitate
reevaluation by the DFP concerning its conclusions about the
ability to mitigate the related adverse effects of the surf
School on the surrounding neighborhood. If the adverse
effects cannot be adequately controlled a discussed herein,
then the conclusions reached by this Analysis may need to be
revised accordingly, and, a conclusion that this particular
Shange in nonconforaing use cannot be permitted under any
Eondstscne.

 

 

 

(Emphasis added.)
Based on the above analysis, the Director made
conclusions of law which stated, in relevant part,

F, Since it constitutes a principal use, the surf school
festablishnent on the site shail be considered a change in
fonconferming use for the comsercial space specifically
identified ag Shop No. J. The change in use 13 from a
principal hotel to office use.

 

 

There is adequate evidence that the surf school

tablishment can involve greater adverse effects (in
Particular seawall congestion, noise, and
Unconpatibiiiey with surrounding residential end
apartment uses) cn surrounding properties within the
Beighborhood when the size of a surfing class is £00
large.

 

 

The change in nonconforming use, which occurred at the
Jocation identified as shop No. 7, has the potential
For greater adverse effects than if the hotel use of

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that location been (sic) continued, ox a
Soetated a2 an accessory use of the Reter

Recordingiy, the change In use shall not be permitted
pursuant co LUO Section 21-4-110(e) (¢) unless the
Size of the surfing classes can be limited such that
the adverse effects are no longer a problem. This
Limit shall be 12 students per class and 3 classes pei
Gays equated to a maximum clase size of 18 people (52
Students ang 3 instructors). If the intensity of use
should ever exceed this level, then it shall

Constitute a soning vielation of 00 Section 21-
Elio (c) (41, and the establishment and/or Landowners
Gf lessees shall be subject to appropriate enforcement
seticn,

 

 

 

    

 

 

 

 

(Emphasis added.)

 

The Director’s Declaratory Ruling stated:

The Hans Bederann Surf Schcol may operate on the site as a
permitted change in nonconforming use (fren hotel to
bffice), subject to the provisions of 100 section 21-
4.110(c} (4), provided:

 

A, Its related surfing instruction operations shall not
at any time exceed a maximum size af 12 students per
Glass, and 3 classes per day: ang

B. The surf school operator shall take appropriate

actions to insure that the seawall adjacent to the
Shoreline in the vicinity of its operations is kept

free of congestion during its periods of instruction.

C. The Zoning Board of Appeals Decision

SDHW timely appealed to the Zoning Board of Appeals

 

 

(2BA) on June 29, 2004. The ZBA subsequently conducted a
contested case hearing pursuant to the ZBA’# rules and the
Administrative Procedure Act, Hawai'i Revised Statutes (HRS)
chapter 91, The 28A affirmed the Director's Ruling:

22, the Director's Ruling was not based on an
erroneous finding of material face and was not an aroitrary
Sr capricious (sic), nor did the Director abuse nie
discretion in concluding that (Hedenana)'s use of the Stop
fon the {Hotel} Property is 2 permitted change in
nonconforming use.

 

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13, the Director*s determin: Hedemann) =
luce of the Shop [# 7] on the [aotel] Property as an office
for surfing instruction, subject to conditions war not Based
on an erroneous finding of material fact, was neither

"ous, Ror an abuse of hit dsscretion,

 

 

 

Pe ‘ “ or.
SDHW appealed to the circuit court. The circuit court
vacated the 2BA’s decision “insofar as it allows the operation of
a commercial surf school at [the Hotel).”
The circuit court focused on “whether the Director has
the power to grant a WO § 21-4.110(c) (4) exception by crafting

‘conditions’

 

in this case by imposing volume restrictions on
new use -- to mitigate any greater adverse effects on surrounding
Properties."” After considering the issue de nove, the circuit

court made the following conclusions of 1:

 

 

14, lhether the Director has the authority under the v0
and the City Charter to craft “conditions” to's change ia
Aonconforming use in order that the adverse effects on
Aeighboring properties will not be greater than the original
henconfarming use, and thereby bring a change in
onconforning use within the ambit sf the 1JO § 21-6,120(e),
Exception, is 9 Legal question subject to ge news review.
Yt requires the interpretation of the governing statutes,
including the L00'and the Honolulu Revised city Charter.

 

 

‘The circuit court did not reach the other issues in SDifi's appeal:

23, the Court, in Light of its decision here, does
not re: ised by Petitioners, including the
Tgufulnese of (1) the delegation by the Director of nis
authority co a private entieyi (2) the Direstor®
determination that the change from a Rotel uae to 6
commercial use and then a change from an accessory,
Commercial use to a non accessary commercial [sic] do not
constitute a forbidden “expansion of use”; and (3) she
Director's finding that the nonconforming surf school use
was of the “sane nature and general impact” as the hotel

 

 

 

 

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15. No provision of the City Charter grants the Director
the power to craft conditions to anelisrate adverse effects
bf atehange in nonconforming use on neighboring properties,
80 that the L00 § 21-¢.110(2) (4) exception can be used

 

 

16. No provision in the 100, and particularly LUO $
284.2010) gives the Director the power to craft
Conditions to’aneliorste adverse effects of a change in
Renconforming ose on neighboring properties go thar the 10
$ 21-4-110(c] (4) excepeion can Be used. The ordinance
implies the opposite: “strict Limits are placed on
Ronconforming dacs to discourage the perpetuation of these
Uses and thug facilitate the timely conversion to conforming

 

 

 

17. the Director interpreted the LUO § 21-4.110(c) to
permit a change {rom one nonconforming use to a new
Ronconforming use, notwithstanding adverse effects from the
Renconforming uae, subject only to conditions he imposes ts
TiSie"Sacn adverse eetects.

18. The Director's interpretation of the 100 grants
broad authorsty to himself 20 allow certain variances by
eratting his omn conditions. this interpretation
contradicts the City Charter, which imposes a detailed
Fegulatory achene for allowing variances,

19. The Land Use Ordinance is subordinate to the city
Charter. Any interpretation of the 100 which conflicts with
the Charter ie contrary to law:

‘The proposition is self-evident that an ordinance must
Contorm to, be subordinate ts, not conflict with, and
pot exceed’ the charter, and can no more change oF
Limit the effect of tho charter than a legssiative act
can modify or supersede = provision of the
Constitution of the state. Ordinances must not only
Conform with the express terms of the charter, but
they must not conflict in any degree with its object
Sr with the purposes [of the charter).

Mazeie vs 09 Soto, 80 Haw. 425, 431, 911 P.2d 60, 66 (1996),
citing, Fasi-y. City council, 72 Haw. 513, 518, 623 P.2a
242, 744 (1992). Resord, Nedabborhood Boatd Now 24 Waianae
Coaae) v, State Lana Use Conmission, 6¢ Haw, 265, 639 P-2a
i037 (1982).

20. ‘They the Director's interpretation of the LUO to
‘Allow a 100 $ 21-4.110(c) (4) exception notwithstanding
Soverse effects of the new nonconforming use on the
Reighboring parcels and occupants, was in violation of the
Orainance itself, in violation of the Revised City Charter,
exceeded the Director's authority and the jurisdiction of
the agency and the Director's order was made upon unlawful
procedure. Accordingly, the detersinations of the Director

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and the ZBA below were contrary to (1) the LUO and (2), the
Revises City Charter and (3} in excess of the Director's
authority. Pursuant to HRS § 91-18(1), (2) and (3), the
determinations of the 28h are overruled.

22.{aic] The Director's failure to follow the LUO and
the Honolulu Revised city Charter has allowed the surf
school's operation to continue in spite of she adverse
Impacts caused by such operation, Given the amount of
Raterials supnitees in the record cataloguing adverse
Gmpacts associated with the surf school and the Lengthy
period the surf school has been operating on the Eraperty,
the Court finds that substantial rights of che Fetseioners
have been prejudiced,

 

 

 

  

 

 

In the circuit court's Amended Final Judgment on
Administrative Appeal, Vacating and Modifying Decision of the
Zoning Board of Appeals Number 2004/ZBA-04, it stated that:

Pursuant to Hawal'l Revised Statutes § 91-14, it Le hereby
ordered, adjudged, and decreed that (SOHW)"S appeal is
Granted and the court. hereby’

 

Vacates the June 3, 2005 decision of the (204)

c"insofar az it allows the operation sf 2
Commercial surf school operation at or,on
{Hotel’s property] in derogation of it's a-2
Medium Density Apartment District Zoning

Modifies the June 3, 2005 decision of the 8A in
428A matter ‘munber 2008/28A-08, by inserting the
following:

The Director of the Department of Planning
3nd Permitting’s declaratory ruling that
the Hans Wedesann Surf School may operate
on the grounds of the New Otani Kaimana
Beach Hotel (sic) a permitted change in
Roneonforning use (from hotel to office) ,
Subject to the provisions on [sic] ROH §
2i-dtio(e), was arbitrary and/or
capricious and constituted an abuse of
Giberetion,

   

 

 

Orders Respondent /Appellee city and County of
Monolutu, by and through the Zoning Board of
Appeals and the Departeent of Planning and
Permitting, to take all necessary actions te
effectuate this orser{-)

 

(Some internal capitalization modified.)

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The Surf School appealed to the ICA. The ICA reversed

the circuit court's judgement, concluding that the Director had

   

discretion to grant the impact-aneliorating conditions and did

 

not abuse his discretion in finding that the Surf School's use
Shop # 7 constituted a valid change in nonconforming use of shop
# 7 because the “ruling was reasonably based on the evidence
before the Director and constituted a reasonable application of
the applicable zoning ordinance and the DPP’s previous
interpretation of that ordinance.” SDHM, 119 Hawai'i at 465, 198
P.3d at 728.

IT. STANDARDS OF REVIEW
A. Appeal from the ZEA

The ZBA As the administrative agency designated to hear and
Geternine appeals from the director’s actions. in the
administration of the City and county of Honolulu zoning
cose.

ip 77 Howat 168, 175, 683 Pea 623, 656 (1394) -
Thue, she 28's order was sn acministrsvive decision subyect
to review by the circuit court. Hawai Revised Statutes
(BRS) § 91-14 (2).

Windward Marine Resort, Inc. v. Sullivan, 86 Hawai'i 171, 177,
948 P.2d 992, $98 (App. 1997).

Review of a decision made by theo:
review of an agency's decision

 

Whether the circuit court wae right oF wrong in ite
Secision, applying the standards set fereh in HRS § 91-1
(1993) £0 tne agency’s decision.

Citizens Against Reckless Dev. v. Zoning Bd, of Appeals, 114
Hawai‘l 184, 193, 159 P.3d 143, 153 (2007) (citing Korean

   

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mple of zu Livan, 87 Hawai'i 217,

229, 953 P.2d 1315, 1327 (1998), HRS $ 91-14(g), “Judicial

review of contested cases,” provides:
(a) Upon review of the record the court may affirm the
Gecision of the agency of remand the case with instructions
for further proceedings; or it may reverse oF modify the
snd order if the substantial rights of the
petitioners may have been prejudiced because the
Sdsinistrative findings, conclusions, decisions, or orders

 

    

  

(2) tn violation of constitutions
provisions; or

 

or statutory

(2) th excess of the statutory authority oF
jurisdiseion of the agency’ oF

(3) Made upon ui

 

awful procedure: or

(a) Affected by other error of law oF

(3) Clearly erroneous in view of the reliable,

probative, and substantial evidence on the whole

Fecord; of

(6) Arbitrary, or cepricious, of characterized by

abuse of discretion or clearly unarranted exercise of

Siseretion.
HRS § 91-14(g) (1993). “*Under HRS § 91-14(g), conclusions of
law are reviewable under subsections (1), (2), and (4)+ questions
regarding procedural defects are reviewable under subsection (3);
[findings of fact] are reviewable under subsection (5); and an

agency’s exercise of discretion is reviewable under subsection

 

(6)."" Paul v. Dept sp., 115 Hawai"i 416, 426, 168 P.30
546, 556 (2007) (internal brackets omitted) (quoting Konno v.

County of Hawai'i, 85 Hawai'i 61, 77, 937 P.2d 397, 413 (1997).
“A conclusion of law that presents mixed questions of fact and
law is reviewed under the clearly erroneous standard because the

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conclusion is dependent upon the facts and cir

 

metances of the
particular case.” esh Produce (Hawaii), tne.

Internati

 

al_Longsh wi y ocal 142, AFL-CI0,
112 Hawai'i 489, 499, 146 P,3d 1066, 1076 (2006) (internal

brackets and quotation marks om:

 

ed) (quoting Brice v. Zoning
Bd. of L gi ty of Honolulu, 77 Hawai'i 168,

172, 883 P.24 629, 633 (1994).

B. Interpretation of the Revised Ordinances of Honolulu and the
Sharter of the City and County of Honoluly

We have stated that:

When interpreting municipal ordinances, we apply the sane
Fules of construction that we epply to seatates: While an
Aaziniscrative agency's interpretation of the ordinance that
Ges responsible for iaplenenting is normally accorded
great weignt, no deference is required when the agency”
Gneerpretation conflicts with or contradicts the manifest
purpose of the ordinance it seeks to implement

 

Colony Surf, Ltd. v. Dir. & Permitting, 116
Hawai'i 510, 514, 174 P.3d 349, 353 (2007) (quoting City 6 County
of Honolulu v. Hsiung, 109 Hawai'i 159, 172, 124 P.3d 434, 447
(2005).

‘This court reviews the interpretation of a statute de

Journalists Univ. of Hawai'i Chapter, 83 Hawai'i 378, 402, 927

 

P.2d 286, 410 (1996). Statutory construction is guided by

established rules:

 

First, the fundamental

 
    

Second, where the stat\
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le duty i to give effect to ite
plain and sbvicus seaning, Third, implicit in the
Faek of statutory construction is’ our foremost
Obligation to ascertain and give ee!
intention of the legislature, which is to
inariiy from the language contained sn
elf. Fourth, when there is doubt, doubleness of
neaning, or indietinetiveness or uncertainty of an
expression used ina statute, an ambiguity exis

Peterson v. Hawai'i Elec, Light Co., Inc., 85 Hawai‘! 322, 327-28,
944 P.2d 1265, 1270-71 (1997), superseded on other grounds by HRS

§ 269-15.5 (Supp. 1999) (block quotation format, brackets,

Unambiguous, our

      

    

     

citations, and quotation marks omitted).

Likewise, “(t]he interpretation of [a] charter {
Similar to the interpretation of a statute.” Maui County Counc:
va Thompson, 84 Hawai"i 105, 106, 929 P.2d 1358, 1356 (1996).

 

Specifically,

[ijn interpreting zoning ordinance [under the LUO}, the
duty of this court ia to ascertain and give effect to the
intent of the Honolulu city council’... - Legislative
intent should be determined, if possible, from the Language
of the ordinance, and the language sust be read in the
Context of the entire ordinance and construed in a manner
Consistent with the purposes of the ordinance.

 

 

State v. Lum, 8 Haw. App. 406, 410, 807 P.2d 40, 43 (1992)
(citations omitted) .
TIT. DISCUSSION

As noted earlier herein, the dispositive issue is
whether the Surf School’s use of Shop # 7 of the Hotel's premises
was a permissible change in nonconforming use (from hotel to
office) under the 1U0. For the following reasons, we hold that
the Director's mixed finding of fact and conclusion of law that

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the Surf School’s use of the Hotel’s premises was a permissible
change in nonconforming use was clearly erroneous as it is not
supported in the record,

A, Purpose of the 10

 

‘The stated purpose and intent of the LUO is as follow:

(a) The purpose of the 100 is to regulate Land use in a
Banner that will encourage orderly development in
Accordance with adopted and use policies, snslusing
the Oany general plan and development plans, and t2
promote and protest the public Health, tasaty ane
Nelfare by, hore particularly:

(i) Minktszing adverse effecte resulting from the
inappropriate location, use oF design of sites
and structures:

(2) Conserving the city's natural, historic ang
Scenic resources and encouraging design which
enhances the physical form of the citys and

(3) Asaiseing the publie in identifying and understanding
Feguiations affecting the developnent and ase of land.

 

WO § 21-1.204a) (1).
B. Permissible Nonconforming Uses Under the LUO
Notwithstanding the stated purpose of the LUO, HRS §
46-4 requires that the counties permit certain nonconforming
uses: “Neither this section nor any ordinance enacted pursuant to
this section shall prohibit the continued lawful use of any
building or premises for any trade, industrial, residential,

agricultural, or other purpose for which the building or premise:

 

is used at the time this section or the ordinance takes effect.”
HRS § 46-4 (a) (1993). The burden to prove that a nonconforming

use is valid is on the “owner, occupant or user,” who must “prove

 

that a lot, @ structure, a use, a dwelling unit, or parking or

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loading was legally established as it now exist.” U0 § 21-
4.110 (emphasis added).
At the county level “[s]trict limits are placed on

nonconforming uses to discourage the perpetuation of these uses,

 

and thus facilitate the timely conversion to conforming uses.”
LUO § 21-4.110(c). See alse LUO § 21-4.110 ("Constraints are

placed on nonconformities to facilitate eventual conformity with

 

the provisions of [the LUO].
Several provisions of the LUO regulate nonconforming
uses. According to the Luo,

[al nonconforming use shall not extend to any part of the
structure or lot which was not arranged or designed for such
lise at the tine of adoption of the provisions of this

Chapter or subsequent anenauent; ner shall she nonconforming
lise be expanded in any manner, or the hours of operation
snereased.

 

 

WO § 21-4.110(c) (1). However, the LUO allows for changes in
nonconforming uses that do not conflict with Wo § 21-

4,120(c) (1). See 190 § 21-4.110(c) (4) (providing conditions that
must be satisfied to support a permissible change in
nonconforming use).

Even if a valid nonconforming use existed at the time
the zoning changed, that use will be terminated if there is an
extended discontinuation of the nonconforming use. LUO § 21-
4,110(c) (2) provides that:

Any nonconforming use that ie discontinued for any re
for 12 consecutive nonths, of for 12 months during any

 

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three-year period, shat
temporary cessation of
inary repairs for a
ny 12-month perio’ oh
Ségcontinust ion.

1 however, a

use. for’ purposes
‘not exceeding 120 days during
Be considered

    

        

LUO § 21-4.110(c) (2). It logically follows that once a
nonconforming use is terminated there can no longer be a change
in nonconforming use based on the terminated use

‘This court construes zoning ordinances under the LUO in
parimateria. See Colony Surf, 116 Hawai'i at 516, 174 P.3d at
395; Waikiki Marketplace v. Zoning Bd, of Appeals, 86 Hawai'i
343, 354, 949 P.2d 183, 194 (App. 1997). Based on the provisions
of the LUO pertaining to nonconforming uses, the party who is
arguing for a change in nonconforming use bears the burden to
demonstrate that the prior nonconforming use (1) was an original
conforming use of the premises that was established before the
change in zoning: or (2) was the result of a valid change in
nonconforming use froma prior valid nonconforming uses and (3)
neither the original nonconforming use nor the prior
nonconforming use has been discontinued. See LUO § 21-
4.110, (c) (2), (4).

C. The Record Does Not Support a Finding That The Surf Schoo!
ilas_a_Rermissible Change in Nonconforming Use

Central to the determination of whether a change in
nonconforming use is permissible is an analysis of whether the

prior nonconforming use was legally established.

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In this case, the Director compared the Surf School's
use of Shop # 7 with a prior nonconforming accessory use of the
hotel. Specifically, the Director stated:

6 of this Analysis, 1t seers reasonable te
ge invuse t2 2 suet

Srester than i: it operased as an Socsucory Uae of the botel

«Further; it would be difticsit to find that a Sta
Involving 50 to’ 50 students would bs typical for an
accessory use of a i2d-unit hotel.

(flor purpe:

 

 

(Emphases added.) Additionally, he stated that “if the adverse
effects can be controlled by limiting class size, then the surf
school's activities should not have an impact greater than if
Lthel surf school operated as accessory use of the hotel.”
(Emphasis added.) Moreover, the Director’s conclusions of law

state that “(t]he change in nonconforming use, which occurred at

 

the location identified as Shop No. 7, haa the potential for
greater adverse effects than if the hotel use of that Location
been [sic] continued, or if it were operated as an accessory use
of the hotel.” (Emphasis added.)

‘The Director erred when he compared the Surf School's
impact to that of “an accessory use of the hotel,” because the
Director could only weigh the Surf School's impact against a
ecally established prior nonconforming use. Here, the Surf
School's use of Shop #7 cannot be compared to “an accessory use
of the Hotel” because the Surf School did not meet its burden to

prove that there was a legally established prior nonconforming

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accessory use of Shop #7. In other words, the Surf School did

 

not establish (1) that there was a valid accessory use of Shop #

7 by the Hotel before t

 

e 1969 Comprehensive Zoning Code 1

 

aged
the Hotel's zoning from Hotel and Apartment District “L" to A-4
Apartment Districts or (2) there was a valid accessory use of
Shop #7 before the LUO changed the Hotel's zoning from A-é
Apartment District to its current A-2 Medium Density Apartment
District designation.

There is no evidence in the record that there was a
legally established accessory use of Shop # 7 prior to the LUO.
The only prior commercial use of Shop # 7 in the record was the
use of Shop # 7 as a beach equipment rental shop. However, as
stated by the IC,

‘The record ia unclear as to when the Hotel's use of Shop #7
fended and ita use for commercial purposes began. Ae early
21993, other commercial tenants used shop #1 to rent out
kayaks, ‘body boards, surfing and other beach equipment. The
record fa11s to establish whether the prior rental
Businesses constituted an accessory use or a non-accessery
Use, Leery whether the customers of these businesses wore
prinarily’ hotel guests or the general public.

 

    

 

SDH, 119 Hawai"i at 456, 198 P.3d at 719, As the record does
not support a finding that the beach equipment rental use was an
accessory use of the Hotel, it cannot be considered a valid prior
nonconforming accessory use of Shop # 7. Even assuming that the
beach equipment rental use was a valid accessory use of the
Hotel, the Surf School has only shown that the use was
uninterrupted since 1993. Therefore, the Surf School has not met

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its burden to show a “legally established” prior nonconforming
accessory use of Shop #7. See LUO $ 21-4.110. As a result, the
Director erred in comparing the Surf School's use of Shop # 7 to
that of a prior nonconforming accessory use of the hotel.’

Based on the foregoing, the Director's mixed finding of
fact and conclusion of law that a change in nonconforming use was
permissible under LUO § 21-4.110(c) (4) was not supported in the
record. As a result, the ICA erred when it concluded that the
Director's ruling “was reasonably based on the evidence before
the director and constituted a reasonable application of the
applicable zoning ordinance and the DPP’s previous interpretation
of that ordinance.” SDH, 119 Hawai'i at 465, 198 P.3d at 728.
‘SDiiii's Other Issues

Because the Director’s ruling was clearly erroneous, we

 

need not consider any of SDHW’s additional arguments.
IV. CONCLUSION
Accordingly, we vacate the ICA’s Opinion and affirm the

circuit court’s amended final judgment but on different grounds,
namely that the Director's mixed finding of fact and conclusion
of law that the Surf School’s use of Shop # 7 was a permissible

* thus, the only legally established prior nonconforming use on
record was the nonconforming hotel ise, Although the Director stated that
“any of the ground-floor comercial uses on the [Hotel] site considered
principal uses, including the surf school, are permissible as long os their

Inpact’on surrounding properties is no greater than that of the hotel use,”
ie clesr from his analysis that he did not follow this standard.

 

 

 

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change in nonconforming use was clearly erroneous as it was not

supported in the record.

 

Dane L. Miller
‘and Wilma Sur (of Miller
Tokuyama © Sur, LLP)
for petitioners/appellants-
appellees Save Diamond Head
Waters, LLC; Kapiolani Park
Preservation Society, LLC;

Mike Beason; and Richard K. Quinn

 

 

William W.L. Yuen
‘and Philip W.T. Chang
(of Ching, Yuen & Morikawa)
for respondent /appellee-
appellant Hans Hedemann Surf,
Ine.

Don S. Kitaoka,
Deputy Corporation Counsel,
for respondent /appellee~
appellee City and County of
Honolulu, by and through the
Department of Planning
and Permitting

25

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