Court Opinion

ID: 4243979
Source: CourtListenerOpinion
Date Created: 2018-02-09 21:10:28.928278+00
Date Added: 2024-06-11T14:17:13.479515
License: Public Domain

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                                                          Electronically Filed
                                                          Supreme Court
                                                          SCAP-16-0000496
                                                          09-FEB-2018
                                                          10:22 AM
                IN THE SUPREME COURT OF THE STATE OF HAWAII

                            ---oOo---
________________________________________________________________

            RICHARD NELSON III, KALIKO CHUN, JAMES AKIONA, SR.,
           SHERILYN ADAMS, KELII IOANE, JR., and CHARLES AIPIA,
                   Plaintiffs-Appellees-Cross-Appellants,

                                         vs.

   HAWAIIAN HOMES COMMISSION, THE DEPARTMENT OF HAWAIIAN HOME
  LANDS, JOBIE MASAGATANI, in her official capacity as Chair of
the Hawaiian Homes Commission, WILLIAM K. RICHARDSON,1 MICHAEL P.
    KAHIKINA, DOREEN NAPUA GOMES, GENE ROSS DAVIS, WALLACE A.
 ISHIBASHI, DAVID B. KAAPU, and WREN WESCOATT, in their official
     capacities as members of the Hawaiian Homes Commission,
              Defendants-Appellees-Cross-Appellees,

                                         and

 WESLEY MACHIDA, in his official capacity as the State Director
              of Finance, and the STATE OF HAWAII,
             Defendants-Appellants-Cross-Appellees.
________________________________________________________________

                                 SCAP-16-0000496

            APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT
                   (CAAP-16-0000496; CIV. NO. 07-1-1663)

                                 FEBRUARY 9, 2018

          RECKTENWALD, C.J., NAKAYAMA, McKENNA, AND POLLACK, JJ.,
                        WITH WILSON, J., DISSENTING

1
      Pursuant to Hawaiʻi Rules of Evidence Rule 201 (1980), this court takes
judicial notice that William K. Richardson passed away on November 10, 2017.
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                     OPINION OF THE COURT BY McKENNA, J.

                                 I. Introduction

          This case is on appeal before this court for the second

time.       In the first appeal, we determined that the political

question doctrine2 did not bar a judicial interpretation of the

meaning of “sufficient sums” for the Department of Hawaiian Home

Lands’ (“DHHL”) administrative and operating expenses, pursuant

to Article XII, Section 1 of the Hawaii Constitution.                Limited

judicially discoverable and manageable standards existed to

interpret the term “sufficient sums,” based on the 1978

Constitutional Convention delegates’ estimate that DHHL’s

administrative and operating costs were $1.3 to 1.6 million at

that time, and, going forward, that figure could be adjusted for

inflation.       Nelson v. Hawaiian Homes Comm’n, 127 Hawaiʻi 185, 277
P.3d 279 (2012) (“Nelson I”).

          On remand to the Circuit Court of the First Circuit

(“circuit court”),3 the circuit court held a bench trial and

found, however, that DHHL’s actual need for its administrative

and operating expenses was over $28 million.              It then concluded

that the legislature was constitutionally obligated to make such

an appropriation to DHHL for fiscal year 2015-16.               The circuit

2
    Under the political question doctrine, “certain matters are political in
nature and thus inappropriate for judicial review.” Nishitani v. Baker, 82
Hawaiʻi 281, 290, 921 P.2d 1182, 1191 (App. 1996) (citation omitted).
3
    The Honorable Jeannette H. Castagnetti presided.

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court also enjoined the defendants (the State of Hawaiʻi and its

Director of Finance, collectively the “State Defendants”) from

violating the constitution or breaching their fiduciary duties

to the Hawaiian Homelands trust beneficiaries.

       The State Defendants filed a motion for reconsideration,

which the circuit court granted in part and denied in part.                 The

circuit court granted the motion in part to modify those

portions of the order that (1) called for the over $28 million

appropriation and (2) enjoined the defendants from violating the

constitution or breaching their fiduciary duties to Hawaiian

Homelands trust beneficiaries.        In its amended order, the

circuit court simply declared that (1) the State of Hawaii did

not provide sufficient sums to DHHL, and (2) that the defendants

must fulfill their constitutional and trust responsibilities.

       This court accepted transfer of this appeal from the

Intermediate Court of Appeals (“ICA”).          On appeal, the State

Defendants argue that (1) the circuit court erred in declining

to use the 1978 baseline of $1.3 to 1.6 million, adjusted for

inflation, to calculate “sufficient sums” for DHHL’s

administrative and operating expenses; and (2) the circuit court

erred in ordering the State Defendants to fulfill their

constitutional obligations under Article XII, Section 1.              The

Hawaii State Legislature, as amicus curiae, filed a brief in

support of the State Defendants.
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       We hold that the circuit court erred by engaging in a

comprehensive inquiry into the amount DHHL actually needed for

its administrative and operating expenses.           Under Nelson I, the

only judicially discoverable and manageable standard for

determining “sufficient sums” for DHHL’s administrative and

operating budget was established by the delegates of the 1978

Constitutional Convention as $1.3 to 1.6 million, adjusted for

inflation.    127 Hawaiʻi at 202-03, 277 P.3d at 296-97.           We

observed that “consideration of [how many lots, loans, and

rehabilitation projects (and their scope)] could provide the

basis for increasing the required administrative funding above

the 1978 baseline identified by the delegates”; however, we

cautioned that such consideration “could also involve the courts

in addressing issues . . . that involve political questions.”

127 Hawaiʻi at 203, 277 P.3d at 297.

       In this case, the circuit court exceeded our mandate in

Nelson I when it determined the amount DHHL actually needed for

its administrative and operating expenses.           Accordingly, we

vacate the circuit court’s First Amended Final Judgment, Final

Judgment, and underlying orders, and remand this case to the

circuit court to determine the current value of $1.3 to 1.6

million (in 1978 dollars), adjusted for inflation.

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                               II.   Background

A.     Nelson I

        In Nelson I, six individual plaintiffs (Richard Nelson III;

Kaliko Chun; James Akiona, Sr.; Sherilyn Adams; Kelii Ioane,

Jr.; and Charles Aipia; collectively, “the Plaintiffs”) filed a

first amended complaint alleging that the State Defendants and

DHHL had violated Article XII, Section 1 of the Hawaiʻi State

Constitution.      That constitutional provision states the

following:

             The legislature shall make sufficient sums available for
             the following purposes: (1) development of home,
             agriculture, farm and ranch lots; (2) home, agriculture,
             aquaculture, farm and ranch loans; (3) rehabilitation
             projects to include, but not limited to, educational,
             economic, political, social and cultural processes by which
             the general welfare and conditions of native Hawaiians are
             thereby improved; (4) the administration and operating
             budget of the department of Hawaiian home lands; in
             furtherance of (1), (2), (3) and (4) herein, by
             appropriating the same in the manner provided by law.

Hawaiʻi State Constitution, Article XII, Section 1.             In Count 1,

the Plaintiffs alleged that the State had failed to make

sufficient sums available to DHHL for the four purposes

enumerated above.       In Count 2, the Plaintiffs alleged that DHHL

breached its trust duties to its beneficiaries by failing to

request sufficient sums from the State.           In Count 3, the

Plaintiffs alleged that the DHHL Defendants breached their trust

obligation to beneficiaries by leasing DHHL lands for commercial

purposes to raise funds.        Lastly, in Count 4, the Plaintiffs

alleged that the DHHL Defendants breached their obligation to

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trust beneficiaries by failing to ascertain whether trust lands

were necessary for general homestead purposes before offering

them for commercial lease.        The parties stipulated to dismiss

Counts 3 and 4 without and with prejudice, respectively.

       The circuit court granted the State Defendants’ motion for

summary judgment (in which the DHHL Defendants joined),

concluding that Counts 1 and 2 raised non-justiciable political

questions.    The circuit court concluded that there were “no

judicially discoverable and manageable standards for resolving

the dispute over the definition and determination of ‘sufficient

sums’” under the Hawaiʻi Constitution “without making initial

policy determinations of a kind clearly for nonjudicial

discretion.”     In other words, the circuit court declined to rule

on the Plaintiffs’ claims, leaving their resolution to the

political process.      See Nelson I, 127 Hawaiʻi at 194, 277 P.3d at

288.

       On initial appeal to the ICA, an ICA majority concluded

Plaintiffs’ claims were not barred by the political question

doctrine.    Nelson v. Hawaiian Homes Comm’n, 124 Hawaii 437, 246
P.3d 369 (App. 2011).       Chief Judge Nakamura concurred with the

majority’s holding that the political doctrine question did not

preclude the justiciability of the dispute over whether the

legislature provided DHHL with “sufficient sums.”            124 Hawaiʻi at

447, 246 P.3d at 379 (Nakamura, C.J., concurring).             In his
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opinion, the “pre-1978 levels and the framers’ intent, including

their concern with the DHHL’s leasing of lands to the general

public” provided the court with “judicially discoverable and

manageable standards for evaluating whether the Legislature has

satisfied the ‘sufficient sums’ requirement of Article XII,

Section 1 without resort to nonjudicial policy determinations.”

124 Hawaiʻi at 452, 246 P.3d at 384 (Nakamura, C.J., concurring).

       On certiorari, this court first traced the development of

our political question jurisprudence.          We observed that the

“political question doctrine is often considered the most

amorphous aspect of justiciability.’”          Nelson I, 127 Hawaiʻi at

194, 277 P.3d at 288 (quoting Nishitani, 82 Hawaiʻi at 299, 921
P.2d at 1191) (brackets omitted).         We stated, “The doctrine is

the result of the balance courts must strike in preserving

separation of powers yet providing a check upon the other two

branches of government.”       Nelson I, 127 Hawaiʻi at 194, 277 P.3d

at 288 (citing Trustees of the Office of Hawaiian Affairs v.

Yamasaki, 69 Haw. 154, 737 P.2d 446 (1987)).           In Yamasaki, this

court adopted the test set forth by the United States Supreme

Court in Baker v. Carr, 369 U.S. 186 (1962), which states

            Prominent on the surface of any case held to involve a
            political question is found: (1) a textually demonstrable
            constitutional commitment of the issue to a coordinate
            political department; or (2) a lack of judicially
            discoverable and manageable standards for resolving it; or
            (3) the impossibility of deciding without an initial policy
            determination of a kind clearly for nonjudicial discretion;
            or (4) the impossibility of a court’s undertaking

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            independent resolution without expressing lack of respect
            due coordinate branches of government; or (5) an unusual
            need for unquestioning adherence to a political decision
            already made; or (6) the potentiality of embarrassment from
            multifarious pronouncements by various departments on one
            question.

Nelson I, 127 Hawaiʻi at 194, 277 P.3d at 288 (citing Yamasaki,
69 Haw. at 170, 737 P.2d at 455 (quoting Baker, 369 U.S. at

217)) (brackets omitted).       In Nelson I, the issue was whether

the determination of “sufficient sums” under Article XII,

Section 1 presented a nonjusticiable political question due to

“a lack of judicially discoverable and manageable standards” for

resolving the issue and/or “the impossibility of deciding

without an initial policy determination of a kind clearly for

nonjudicial discretion.”       Nelson I, 127 Hawaiʻi at 193-94, 277
P.3d at 287-88.

       We ultimately “affirm[ed] the ICA’s judgment, but only on

the narrower ground that the determination of what constitutes

‘sufficient sums’ for administrative and operating expenses

under the Hawaiʻi Constitution’s Article XII, Section 1 is

justiciable and not barred as a political question.”             127 Hawaiʻi

at 206, 277 P.3d at 300.       We held judicially discoverable and

manageable standards existed to determine “sufficient sums” for

DHHL’s administrative and operating expenses, based on the 1978

Constitutional Convention delegates’ estimate that those costs

were $1.3 to 1.6 million at that time.          Nelson I, 127 Hawaii

185, 277 P.3d 279.      This court did not judicially determine what

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“sufficient sums” would be, and we imposed no funding

requirements upon the legislature.          We held only that the

political question doctrine did not bar justiciability of the

case.

       In arriving at this holding, we turned to the 1978

Constitutional Convention history.          We quoted the spirited

discussion among the delegates who were trying to “pin down a

numerical figure” for DHHL’s funding generally.             127 Hawaii at

202, 277 P.3d at 296.        We reproduced Delegates Burgess, De Soto,

and Sutton’s dialogue, through which they “ultimately arrived at

$1.3 to 1.6 million as a ‘sufficient sum’ . . . [as] to

administrative and operating expenses” specifically, as follows:

             Delegate Burgess: [W]hat would be the estimated cost of
             these programs which are mandated?

             ....

             Delegate De Soto: What we propose with respect to “shall
             fund” is the administrative and costs of running the
             Hawaiian homes program, which would amount to operating and
             administrating approximately $1.3 to $1.6 million, taking
             into consideration inflation, collective bargaining
             agreements that go into inflation with the pay.

             ....

             Delegate Burgess: I would ask — is the $1.3 to $1.6 million
             that was mentioned the total cost of the programs which are
             mandated to the legislature? Does that amount include the
             development of home, agriculture, farm and ranch lots, and
             the other aims that are cited on page 2 of the proposal?

             ....

             Delegate Burgess: Does the $1.3 to $1.6 million figure that
             was mentioned just a few minutes ago include the costs of
             the home developments, the loans and the other
             rehabilitation projects which are referred to on page 2? —
             in other words, the development of home, agriculture, farm
             and ranch lots; the home, agriculture, aquaculture, ranch

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            and farms loans; and all of those programs. Are all of
            those included in the total estimate of the $1.3 million to
            fund this program, or is the total cost to the State
            different from that?

            ....

            Delegate Sutton: The $1.3 to $1.6 million is for
            administrative costs at present. Their need is more. The
            way the State itself can fund all the rest of the projects
            — and directly answering your question, delegate, is no, is
            not only $1.3 to $1.6 million — the way the State can find
            the funds is through mutual agreement with different parts
            of the government here in Hawaii; and that is, for the poor
            people who qualify, that is for HHA or Hawaiian Homes
            Commission Act properties, that there are similar needs and
            requirements for those to get the land — that is, under
            $10,000 net assets. The State may fund these projects and
            come out with considerably more for the people at less of
            an expense, simply because the Hawaiian homes commission
            has land and does not need to condemn and purchase other
            land to fit the needy at that level.

Id. (citation omitted).       Synthesizing these discussions, we

concluded

            Thus, by the end of the Committee on the Whole Debates,
            what was certain was that the $1.3 to $1.6 [million] figure
            represented “sufficient sums” for administrative and
            operating expenses only. As to that purpose under Article
            XII, then, the 1978 Constitutional Convention history does
            provide judicially discoverable and manageable standards
            that do not involve initial policy determinations of a kind
            clearly for nonjudicial discretion. At a minimum, funding
            at or above the $1.3 to $1.6 million envisioned in 1978
            would be required.8 Therefore, the determination of what
            constitutes “sufficient sums” for administrative and
            operating expenses is not barred by the political question
            doctrine.
            8
             Presumably, this figure could be adjusted to reflect the
            impact of factors such as inflation or increased collective
            bargaining costs, both of which were acknowledged by
            Delegate De Soto as factors that could appropriately be
            taken into account in determining the required
            contribution.

127 Hawaii at 202-03, 277 P.3d at 296-97 (citation omitted).

This court thus ruled that judicially discoverable and

manageable standards existed with respect to “sufficient sums”

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for administrative and operating expenses, i.e., $1.3 to 1.6

million in 1978 dollars, adjusted for inflation.             127 Hawaiʻi at

202-03, 203 n.8, 277 P.3d at 296-97, 297 n.8.            We also stated

that Delegate Sutton’s statement (“Their need is more”) referred

only to DHHL’s need for more money for another enumerated

purpose under Article XII, Section 1.          127 Hawaii at 203, 277
P.3d at 297 (interpreting “Their need is more” to refer to more

money for the development of home, agriculture, farm, and ranch

lots, not for administrative and operating expenses.)

       We held, “Article XII, Section 1 and its constitutional

history, however, do not shed light on what would constitute

‘sufficient sums’ for the other three enumerated purposes,” lot

development, loans, and rehabilitation projects.             127 Hawaiʻi at

206, 277 P.3d at 300.       Thus, “the political question doctrine

bars judicial determination of what would constitute ‘sufficient

sums’ for those purposes, and the ICA erred in concluding

otherwise.”    Id.   We noted that consideration of the other three

purposes “could provide the basis for increasing the required

administrative funding beyond the 1978 baseline identified by

the delegates, but could also involve the courts in addressing

issues (the development of lots, loans, and rehabilitation

projects) that involve political questions.”           Id.    We rejected,

however, the State’s argument that “challenges associated with

determining the upper limit of the required administrative

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funding render the calculation of the minimum required

contribution nonjusticiable.”         Id.   We stated, “It is clear that

the constitutional delegates intended to require appropriation

of ‘sufficient sums’ to relieve DHHL of the burden of general

leasing its lands to generate administrative and operating

funds, and to that end, they identified the minimum funding

necessary for such expenses.”         Id.   (footnote omitted).

       Prior to the entry of this court’s judgment, the Plaintiffs

requested an award of attorneys’ fees and costs under the

private attorney general doctrine.          Nelson v. Hawaiian Homes

Comm’n, 130 Hawaii 162, 307 P.3d 142 (2013).            In analyzing and

ultimately denying the request, this court nonetheless

recognized that the Plantiffs’ litigation produced the following

result:     “DHHL will be able to shift the funds it was spending

on administrative and operating expenses towards fulfilling its

trust duties to its beneficiaries.”          130 Hawaii at 167, 307 P.3d

at 147.     Once this court resolved the fees and costs request and

issued its judgment, the case returned to the circuit court for

further proceedings.

B.     Remand Proceedings before the Circuit Court

       1.   The Parties’ Motions for Summary Judgment (“MSJ”)

             a.   Plaintiffs’ MSJ

       On remand to the circuit court, the Plaintiffs filed a MSJ,

arguing that there were no genuine issues of material fact, and

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that the Plaintiffs were entitled to an order declaring that the

State had failed to sufficiently fund DHHL, and that DHHL had

breached its trust duty to vigorously seek sufficient funding.

The Plaintiffs argued that DHHL requested from the State, and

the State appropriated to DHHL, sums for administrative and

operating expenses that were far less than DHHL’s actual need.

In opposition to the Plaintiff’s MSJ, the State Defendants

argued that “sufficient sums” should be calculated based on the

$1.3 million figure4, drawn from the 1978 constitutional history

of Article XII, Section 1, adjusted for inflation.

               b.   DHHL’s MSJ

          The DHHL Defendants also filed a MSJ, asking for Count II

of the first amended complaint to be dismissed, on the basis

that no genuine issue of material fact existed as to whether

DHHL had requested sufficient funds for its administrative and

operating expenses from the legislature for the 2013-2015 fiscal

biennium.       The DHHL Defendants stated that they requested $25

million per year for the 2013-2015 fiscal biennium for

administrative and operating expenses, and were appropriated

around $9 million per year by the legislature.               Therefore, they

argued, they demonstrated that they fulfilled their trust duty

4
      Before the circuit court, the State Defendants asserted that the $1.3
million figure, adjusted for inflation, represented “sufficient sums.”
Before this court, however, the State Defendants assert that the $1.3 to 1.6
million figure, adjusted for inflation, represents “sufficient sums.”

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to seek sufficient sums for administrative and operating

expenses from the State.          The State Defendants again counter-

argued that “sufficient sums” for DHHL was $1.3 million5,

adjusted for inflation.

               c.   The State Defendants’ MSJ

          The State Defendants also filed a MSJ.         They argued that

Article XII, Section 1 requires the legislature to make

“sufficient sums” available for DHHL’s administrative and

operating budget “in the manner provided by law.”               According to

the State Defendants, the “manner provided by law” was through

the legislature’s appropriation process, described in Article

VII, Sections 5, 7, 8, and 9 of the Hawaii Constitution, and

Section 213(f) of the Hawaiian Homes Commission Act, which

governs the Hawaiian home administration account.

               d.    The Circuit Court’s Orders Denying All Parties’
                     MSJs

          The circuit court denied all of the parties’ MSJs.            In its

order denying the Plaintiffs’ and DHHL’s MSJs, the circuit court

explained that it required a “fuller development of the facts”

in order to determine whether the State violated its

constitutional duty to make sufficient sums available to DHHL

for its administrative and operating budget, and whether DHHL

5
      Again, before the circuit court, the State Defendants asserted that the
$1.3 million figure, adjusted for inflation, represented “sufficient sums.”
Before this court, however, the State Defendants assert that the $1.3 to 1.6
million figure, adjusted for inflation, represents “sufficient sums.”

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breached its fiduciary duty to its beneficiaries by failing to

request sufficient sums from the legislature.            The circuit court

then issued an order summarily denying the State Defendants’

MSJ.

       2.   Bench Trial

       The case then proceeded to an eight-day bench trial.            DHHL

relied principally upon Hawaiian Homes Commission Chair Jobie

Masagatani and DHHL administrative services officer Rodney Lau

to establish the $28 million figure as “sufficient sums” for

DHHL’s administrative and operating budget for the 2015-2016

fiscal year.     These witnesses testified that DHHL arrived at the

$28 million figure by starting with a base budget of moneys

already appropriated for DHHL’s administrative and operating

budget in prior years.       From there, DHHL determined how many

more administrative positions it needed to deliver quality

services to its beneficiaries and meet its mission.             To that

subtotal, DHHL added a 5% inflation factor, estimating that it

needed $28.1 – 28.2 for its administrative and operating

expenses.

       The State Defendants relied upon Department of Budget and

Finance administrator Neil Miyahira to testify that “sufficient

sums” needed to be determined through the typical legislative

appropriation process.       Miyahira testified that he was familiar

with the $1.3 to 1.6 million figure established at the 1978

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Constitutional Convention as “sufficient sums.”            Nevertheless,

he testified that the Department of Budget and Finance evaluates

DHHL’s budget requests in the normal course, as it does with any

other State department, without regard to the mandate contained

in Article XII, Section 1.        He also testified that he considered

“administrative and operating expenses” to include only

“salaries and operating expenses for [DHHL’s] offices.”

       3.   The Circuit Court’s Findings of Fact, Conclusions of
            Law, and Order

       After trial, the circuit court issued its Findings of Fact,

Conclusions of Law, and Order (“FOFs, COLs, and Order”).                Key to

this appeal, the circuit court’s Finding of Fact (“FOF”) 44

states, “DHHL needs more than $28 million annually for its

administrative and operating budget for fiscal year 2015-16, not

including repairs.”      The circuit court then declared and ordered

the following:

            1. The State of Hawaii has failed to provide sufficient
            funds to the Department of Hawaiian Home Lands for its
            administrative and operating budget in violation of the
            State’s constitutional duty to do so under article XII,
            section 1 of the Hawaii Constitution.

            2. The State of Hawaii must fulfill its constitutional
            duty by appropriating sufficient general funds to the
            Department of Hawaiian Home Lands for its administrative
            and operating budget so that the Department does not need
            to use or rely on revenue directly or indirectly from
            general leases to pay for these expenses.

            3. Although what is “sufficient” will change over the
            years, the sufficient sums that the legislature is
            constitutionally obligated to appropriate in general funds
            for DHHL’s administrative and operating budget (not
            including significant repairs) is more than $28 million for
            fiscal year 2015-2016.

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            4. Prior to 2012, the DHHL Defendants breached their trust
            duties by failing to take all reasonable efforts –
            including filing suit – to obtain all the funding it needs
            for its administrative and operating budget.

            5. The defendants shall prospectively fulfill their
            constitutional duties and trust responsibilities. They are
            enjoined from violating these obligations.

            6. Judgment on Counts 1 and 2 shall be entered in favor of
            Plaintiffs and against the State Defendants (as to Count 1)
            and the DHHL Defendants (as to Count 2).

The circuit court then entered Final Judgment.

       4.   The State Defendants’ Motion for Reconsideration

       Ten days later, the State Defendants filed a motion for

reconsideration.     The State Defendants argued that insufficient

evidence supported the $28 million figure.           Consequently, they

asked the circuit court to eliminate paragraph 3 in its order.

The State Defendants also argued that paragraph 5 violated the

constitutional principle of separation of powers.            Specifically,

the State Defendants asserted, “[F]or reasons provided in the

State Defendants’ motion for summary judgment, filed 4/17/15,

‘sufficiency’ within the meaning of art. XII, Section 1, is to

be determined by the legislature, through its usual budgeting

process, not by the courts.”        (Emphasis in original.)       The State

Defendants argued that the separation of powers doctrine

prohibited the court from compelling the legislature to

appropriate any particular amount of money.           Consequently, they

asked the circuit court to eliminate paragraph 5 in its order.

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       The legislature, as amicus curiae, was granted leave to

file a memorandum in support of the State Defendants’ motion for

reconsideration.     The legislature argued that the circuit

court’s ruling usurped the legislature’s power to appropriate

public funds.     The legislature asked the circuit court to amend

its judgment and order to make it clear that the circuit court

was not ordering an appropriation.

       The court held a hearing on the motion for reconsideration,

then reconvened the parties for its oral ruling three days

later.   The circuit court first orally ruled that substantial

evidence supported its finding that over $28 million constituted

sufficient sums for DHHL’s administrative and operating expenses

for fiscal year 2015-2016.        The circuit court next addressed the

State Defendants’ argument that the circuit court violated the

separation of powers doctrine by ordering the legislature to

appropriate funds, and that the circuit court’s authority was

limited to providing declaratory relief only.            The circuit court

orally ruled as follows:

            [W]hen the courts determine that the State has not met its
            constitutional duty to act and has not complied with the
            Constitution because the amount appropriated, as determined
            through the budgetary process, is insufficient and does not
            pass constitutional muster, the remedy can and should be
            compliance with the requirement to make sufficient sums
            available for DHHL’s administrative and operating budget.
            Otherwise, there is no effective remedy for the State’s
            violation of its constitutional duty to fund.

The circuit court then concluded that “declaratory relief alone

is not a sufficient remedy to the years of underfunding of the

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Department of Hawaiian Homelands that it has suffered and that a

form of injunctive relief is appropriate and necessary for the

State to comply with its constitutional mandate under Article

XII, section 1.”

       The circuit court’s written order granted in part and

denied in part the State Defendants’ motion for reconsideration.

The circuit court denied the motion in part, declining to

reconsider its finding that over $28 million constituted

“sufficient sums” for DHHL’s administrative and operating

expenses for fiscal year 2015-2016.         The circuit court granted

the motion in part, modifying paragraphs 3 and 5 so that the

order would not be “construed in any form as an order for the

Legislature to appropriate funds.”         Paragraph 3 was modified to

eliminate language obligating the legislature to appropriate a

sum certain to DHHL for its administrative and operating

expenses, concluding instead that the legislature’s current

appropriation was insufficient:

            Although what is sufficient will change over the years, the
            amount of general funds appropriated to DHHL for its
            administrative and operating budget for fiscal year 2015-
            2016 ($9,632,000) is not sufficient. The State of Hawaii
            is required to comply with the Hawaii Constitution and must
            fund DHHL’s administrative and operating expenses by making
            sufficient general funds available to DHHL for its
            administrative and operating budget for fiscal year 2015-
            2016.

Paragraph 5 was modified to eliminate language enjoining the

defendants from violating their constitutional duties or

breaching their trust responsibilities; as amended, paragraph 5
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reads, “The Defendants must fulfill their constitutional and

trust responsibilities.”

          The circuit court then entered an “Order Amending Order

Issued November 27, 2015” reflecting the changes to paragraphs 3

and 5 in its order.

          The Plaintiffs filed a motion for reconsideration of that

order.       They asked the circuit court to again modify its order

to explicitly state, “Sufficient sums for DHHL’s administrative

and operating budget (not including significant repairs) is more

than $28 million for fiscal year 2015-16.”               The circuit court

summarily denied the motion.

          The circuit court then entered a First Amended Final

Judgment.        The State Defendants appealed.6        This court accepted

transfer of this case from the ICA.

C.        Points of Error on Appeal

          On appeal, the State Defendants raise the following points

of error:

                1. The circuit court erred, as a matter of law, when,
                notwithstanding firmly established principles of
                constitutional construction, it construed the provisions of
                the amendment the delegates to the 1978 Constitutional
                Convention made to article XII, section 1 of the Hawaii
                Constitution and concluded that

                      a. The term “administration and operating budget”
                      includes and is the budget for all of DHHL’s
                      administrative and operating expenses, including

6
      The Plaintiffs also cross-appealed. For reasons described in greater
detail in n.8, we find the Plaintiffs’ points of error on appeal
unpersuasive.

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                     “actual administrative and operating expenses,”
                     “programmatic costs,” and “operating costs” as that
                     term is defined in section 37-62, Hawaii Revised
                     Statutes (HRS).
                     . . . .
                     b. Despite the availability of federal funds, and
                     express authority in the HHCA to pay particular
                     operating expenses with funds other than receipts
                     from DHHL’s general leasing and other dispositions of
                     “available land,” all of DHHL’s administration and
                     operating budget must be funded by general funds.
                     . . . .
                     c. DHHL Defendants have the first and last word as
                     to which expenses and how much funding is needed for
                     its annual administrative and operating expenses, and
                     neither the director of finance, governor, nor the
                     legislature may reduce or eliminate an expense DHHL
                     includes in its administration and operating budget.7
               . . . .
               2. The circuit court erred in finding and concluding and
               declaring that the State of Hawaii failed to provide
               sufficient funds to DHHL for its administrative and
               operating budget, and rejecting State Defendants’ position
               that article XII, section 1 of the Hawaii Constitution only
               requires funding for DHHL’s administration and operating
               budget of $1.3-$1.6 million (the 1978 Baseline).
               . . . .
               3. The circuit court erred in concluding that injunctive
               relief in favor of Plaintiffs and against State Defendants,
               particularly the legislature, is appropriate, and enjoining
               State Defendants, particularly the legislature, from
               violating their constitutional duties and trust
               responsibilities. . . .

In short, the State Defendants challenge (1) whether the circuit

court erred in declining to use the 1978 baseline of $1.3 to 1.6

million, adjusted for inflation, to calculate “sufficient sums”;

and (2) whether the circuit court erred in ordering the State

7
      The State Defendants provide no argument on the first point of error
and its three subparts. These points are deemed waived. See Hawaiʻi Rules of
Appellate Procedure (“HRAP”) Rule 28(b)(7) (2015) (requiring the appellant’s
opening brief to include “[t]he argument, containing the contentions of the
appellant on the points presented and the reasons therefor, with citations to
the authorities, statutes and parts of the record relied on,” and stating,
“Points not argued may be deemed waived.”) Furthermore, as to point of error
1.c, the circuit court did not actually conclude that DHHL has “the first and
last word as to which expenses and how much funding is needed for its annual
administrative and operating expenses. . . .” There is no such conclusion of
law so stating.

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Defendants to fulfill their constitutional obligations under

Article XII, Section 1.8

                            III.   Standard of Review

          The appellate court reviews “questions of constitutional

law de novo, under the right/wrong standard.”               Jou v. Dai-Tokyo

Royal State Ins. Co., 116 Hawaii 159, 164-65, 172 P.3d 471, 476-

77 (2007) (citation omitted).

8
      On cross-appeal, the Plaintiffs raise the following points of error:
(1) “[t]he State Defendants’ motion for reconsideration was based on
arguments that could have been, or were argued earlier”; and (2) “[t]he State
Defendants waived their objections to the injunctive relief requested by
[Plaintiffs].” We find these points of error unpersuasive. First, the
Plaintiffs argue that the State Defendants raised their separation of powers
argument initially in their MSJ and, therefore, could not raise that argument
again in their motion for reconsideration. See, e.g., Sousaris v. Miller, 92
Hawaiʻi 505, 513, 993 P.2d 539, 547 (2000) (“Reconsideration is not a device
to relitigate old matters or to raise arguments or evidence that could and
should have been brought during an earlier proceeding.”) (footnote omitted).
The State Defendants did raise the separation of powers argument in their
MSJ, but that was for the purpose of preventing a judicial determination of
“sufficient sums” altogether. When the State Defendants raised the
separation of powers argument again in their motion for reconsideration, it
was in direct response to the circuit court’s order affirmatively obligating
the State to fund over $28 million in administrative and operating expenses
to DHHL. The State Defendants assert, and we agree, that the separation of
powers argument raised in response to the circuit court’s order served a
different purpose than the separation of powers argument raised in the State
Defendants’ MSJ. Therefore, the State Defendants could not have raised (and
did not raise) the argument earlier. The circuit court, therefore, did not
err in granting, in part, the State Defendants’ motion for reconsideration.
Further, in granting, in part, the State Defendants’ motion for
reconsideration, the circuit court also properly modified its order so that
it would not be “construed in any form as an order for the Legislature to
appropriate funds.”
      Second, the Plaintiffs argue that the State Defendants waived any
objection to the circuit court’s imposition of injunctive relief. As this
opinion later notes, however, the circuit court erred in directing a $28
million appropriation in its initial order; its amended order properly
directed the State Defendants simply to fulfill their constitutional
responsibilities. Thus, there is no need to address this point of error.

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                              IV.   Discussion

       The State Defendants argue the circuit court erred in the

manner in which it determined “sufficient sums.”            On remand for

the determination of what constituted “sufficient sums” under

Article XII, Section 1, the circuit court held a trial to

establish the amount DHHL actually needed for its administrative

and operating expenses for fiscal year 2015-2016.            The State

Defendants insisted, on the other hand, that Nelson I required

only that “sufficient sums” be determined with reference to the

$1.3 to 1.6 million figure established at the 1978

Constitutional Convention, adjusted for inflation.

       The State Defendants are correct.        Our Nelson I opinion

clearly concluded that the only “judicially discoverable and

manageable standard” for determining “sufficient sums” for

DHHL’s administrative and operating expenses was the $1.3 to 1.6

million figure established by the Constitutional Convention

delegates, adjusted for inflation:

            Thus, by the end of the Committee on the Whole Debates,
            what was certain was that the $1.3 to $1.6 million figure
            represented “sufficient sums” for administrative and
            operating expenses only. As to that purpose under Article
            XII, then, the 1978 Constitutional Convention history does
            provide judicially discoverable and manageable standards
            that do not involve initial policy determinations of a kind
            clearly for nonjudicial discretion. At a minimum, funding
            at or above the $1.3 to $1.6 million envisioned in 1978
            would be required. Therefore, the determination of what
            constitutes “sufficient sums” for administrative and
            operating expenses is not barred by the political question
            doctrine.

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Nelson I, 127 Hawaii at 202-03, 277 P.3d at 296-97 (footnote

omitted, emphasis added).9

           There is no suggestion in Nelson I that what constitutes

“sufficient sums” would be recalculated periodically by the

circuit court as “actual sums,”10 because to do so would involve

the judiciary in “initial policy determinations of a kind

clearly for nonjudicial discretion.”              That is what occurred in

this case.        Instead, this court determined in Nelson I that the

amount sufficient in 1978 for administrative and operating

expenses ($1.3 to 1.6 million) could be adjusted for inflation.

In other words, in 1978, the delegates established “sufficient

sums” that would not be recalculated in the future, but adjusted

in a manner that could be mathematically determined, not

judicially determined.           Further, were “actual sums” the

9
      The delegates arrived at this numerical determination after extensive
discussion of the 1976 DHHL General Plan, the increasing number of homestead
applicants, the need for a bigger DHHL staff, and the need for automated
record-keeping systems. Nelson I, 127 Hawaiʻi at 200, 202-03, 277 P.3d at
294, 296-97. Therefore, we respectfully disagree with the Dissent, which
posits that Nelson I leaves open present judicial reconsideration of these
factors. Dissent Sections II.A.3 and II.B.
10
      Therefore, we respectfully disagree with the Dissent that the circuit
court was free to “affirmatively” determine, as “sufficient sums,” DHHL’s
“actual” administrative and operational costs. Dissent Section II.C.
Respectfully, the Dissent misreads Nelson I, which concluded only that “a
judicial determination of what affirmatively constitutes ‘sufficient sums’
for the other three constitutional purposes [in Article XII, Section 1] is
nonjusticiable, based on the political question doctrine.” Nelson I, 127
Hawaiʻi at 206, 277 P.3d at 300. The Dissent misinterprets this sentence to
mean that this court expressly held that the circuit court could
“affirmatively” determine “sufficient sums” as “actual” sums for DHHL’s
administrative and operating expenses. Nelson I did not so hold.

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standard, there would be no need for Delegate De Soto to state

that the $1.3 to 1.6 million figure could be adjusted for

inflation, as periodically recalculating actual, present sums

requires no adjustment for inflation.

       The State Defendants also argue that the $1.3 to 1.6

million figure did not need to be adjusted for increased

collective bargaining costs in addition to inflation, but

increased collective bargaining costs were included in

inflation.     To support this argument, they point to Delegate De

Soto’s comment at the 1978 Constitutional Convention, which was,

“What we propose with respect to ‘shall fund’ is the

administrative and costs of running the Hawaiian homes program,

which would amount to operating and administrating approximately

$1.3 to 1.6 million, taking into consideration inflation,

collective bargaining agreements that go into inflation with the

pay.”    Debates in the Committee of the Whole on Hawaiian Affairs

Comm. Prop. No. 11, in 2 Proceedings of the Constitutional

Convention at 421-22.        To the State, Delegate De Soto

acknowledged that increased pay due to collective bargaining

agreements is one major contributor to inflation; it is not

separate from inflation, but a key contributor to inflation.

This interpretation appears to be faithful to Delegate De Soto’s

floor speech.      In short, the State Defendants conclude that the

State is constitutionally mandated to provide to DHHL, for

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administrative expenses, a level of funding at or above $1.3 to

1.6 million, adjusted for inflation.          This amount, they argue,

is consistent with the framers’ intent.

       The DHHL Defendants disagree with the State Defendants.

They argue that this court in Nelson I “instructed the Circuit

Court to determine on remand ‘sufficient sums’ for DHHL’s

administration and operating budget without limitation or

restriction.”     There is no such remand instruction in the Nelson

I opinion, which simply affirmed the ICA’s judgment.             127 Hawaii

at 206, 277 P.3d at 300.       The DHHL Defendants point out that

Nelson I quoted the following 1978 Constitutional Convention

history, which indicates that the $1.3 to 1.6 million figure

identified by the delegates was not the upper limit and was

insufficient even in 1978:

            Delegate Sutton: The $1.3 to $1.6 million is for [DHHL’s]
            administrative costs at present. Their need is more.
            127 Hawaiʻi at 202, 277 P.3d at 296 (emphasis added).
            . . . .
            “As demands on the department and staff grow, a much bigger
            staff will be required . . . Not only is there a demand on
            the money for staff, but there is also other administrative
            demands that need to be met through funds, especially in
            the area of record-keeping.”
            127 Hawaii at 200, 277 P.3d at 294 (quoting 1 Proceedings
            at 414).

However, as we made clear in Nelson I, the phrase “Their need is

more” did not refer to more money than $1.3 to 1.6 million for

administrative and operating expenses; it referred to more money

for the “development of home, agriculture, farm and ranch lots.”

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127 Hawaii at 203, 277 P.3d at 297.              We held that judicially

calculating “sufficient sums” for that purpose was barred by the

political question doctrine.             127 Hawaii at 205, 277 P.3d at

299.

            For their part, in support of their understanding that

“sufficient sums” means “actual sums,” the Plaintiffs point to

Nelson I’s quotation of the definition of “sufficient” from

Webster’s Third New International Dictionary as “marked by

quantity, scope, power, or quality to meet with the demands,

wants or needs of a situation or of a proposed use or end. . .

.”         Nelson I, 127 Hawaiʻi at 198, 277 P.3d at 292.          This court,

however, found these dictionary definitions too unclear to

apply.11        Id.   (“Even with these popular definitions in mind, it

is unclear what precisely the constitutional delegates intended

when they used the term ‘sufficient sums.’”)                As a result, this

court turned to the 1978 Constitutional Convention history to

interpret the phrase “sufficient sums.”               Id.   The $1.3 to 1.6

million baseline (adjusted for inflation) set by the 1978

Constitutional Convention delegates was the only justiciable

basis for determining “sufficient sums.”               Moreover, if “actual

sums” were the standard, there would have been no need for this
11
      Therefore, we respectfully disagree with the Dissent that the
dictionary definition of “sufficient” provides a judicially discoverable and
manageable standard for determining “sufficient sums.” Dissent Section
II.A.3. This court previously rejected that standard in Nelson I.

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court, in Nelson I, to hold nonjusticiable the determination of

sufficient sums for the other three enumerated purposes in

Article XII, Section 1.       There would also have been no need for

Delegate De Soto to state that the $1.3 to 1.6 million figure

could be adjusted for inflation, as any present calculation of

“actual sums” would not need to be adjusted for inflation.

Again, the Constitutional Convention history supports that the

only “judicially discoverable and manageable standard” for

determining “sufficient sums” for DHHL’s administrative and

operating expenses in 1978 was the $1.3 to 1.6 million baseline

identified by the delegates, adjusted for inflation.

        In short, the Legislature and State Defendants are correct

that the circuit court deviated from Nelson I’s standard for

determining “sufficient sums” for DHHL’s administrative and

operating expenses:      the 1978 baseline level of $1.3 to 1.6

million, adjusted for inflation.

       Because the circuit court rejected this method of

calculating sufficient sums, it made no finding as to what $1.3

to 1.6 million, adjusted for inflation for the 2015-2016 fiscal

year, would be.     We note that, at various points during the

remanded proceedings, the State Defendants calculated $1.3 to

1.6 million adjusted for inflation to be over $4.9 million,

while the legislature calculated it to be $5.8 million.

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       This court is not in a position to make the ultimate

factual finding.     Rather, “[w]here findings are infirm because

of an erroneous view of the law, a remand is the proper course

unless the record permits only one resolution of the factual

issue.”    Wilart Assocs. v. Kapiolani Plaza, Ltd., 7 Haw. App.
354, 360, 766 P.2d 1207, 1211 (1988) (citation omitted).              Here,

the record does not permit only one resolution of the factual

issue.

       Therefore, we vacate the circuit court’s First Amended

Final Judgment, Final Judgment, and underlying orders.             This

case is remanded to the circuit court for further proceedings.

On remand, the circuit court shall determine whether the State

Defendants have provided “sufficient sums” for DHHL’s

administrative and operating budget using the only judicially

discoverable and manageable standard identified in Nelson I:

the 1978 baseline of $1.3 to 1.6 million, adjusted for

inflation.

                               V.   Conclusion

       For the foregoing reasons, the circuit court’s First

Amended Final Judgment, Final Judgment, and underlying orders

are vacated, and this case is remanded to the circuit court to

determine whether the State Defendants have provided “sufficient

sums” for DHHL’s administrative and operating budget for the

2015-2016 fiscal year using the only judicially discoverable and

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manageable standard identified in Nelson I:           the 1978 baseline

of $1.3 to 1.6 million, adjusted for inflation.

Sharla Ann Manley                   /s/ Mark E. Recktenwald
and Summer L.H. Sylva
for plaintiffs-appellees/           /s/ Paula A. Nakayama
cross-appellants
                                    /s/ Sabrina S. McKenna
Charleen M. Aina
for defendants-appellants/          /s/ Richard W. Pollack
cross-appellees

Melvyn M. Miyagi, Brian A.
Kang, and Ross T. Shinyama
for defendants-appellees/
cross-appellees

Mark J. Bennett
for amicus curiae
Hawaiʻi State Legislature

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