No. 28358, Wednesday, October 10, 2012, 10 a.m.

(Amended 08/03/12)

PILA`A 400 LLC, Appellant-Appellant, v. BOARD OF LAND AND NATURAL RESOURCES and DEPARTMENT OF LAND AND NATURAL RESOURCES, STATE OF HAWAI`I, Appellees-Appellees.

Attorney(s) for Appellant-Appellant:

Wesley H.H. Ching and Kathleen M. Douglas (Fukunaga Matayoshi Hershey & Ching) and Colleen Hanabusa

Attorney(s) for Appellees-Appellees:

David M. Louie, Attorney General and William J. Wynhoff, Deputy Attorney General (for Dep’t of Land and Natural Resources, State of Hawai`i)

David M. Louie, Attorney General; Russell A. Suzuki and Diane Erickson, Deputy Attorneys General (for Board of Land and Natural Resources, State of Hawai`i)

NOTE: Order granting motion to continue oral argument, filed 8/2/12.

COURT: Fujise, J., Presiding Judge, Circuit Court Judges Wilson and Lee, in place of Nakamura, C.J., Foley and Leonard, JJ., recused.

SPECIAL NOTE: The above argument will take place in the Supreme Court courtroom on the Second Floor of Ali`iolani Hale, 417 South King Street, Honolulu, Hawai`i.

[ Listen to the entire audio recording in mp3 format ]

Brief Description:

This is a secondary appeal arising out of the Board of Land and Natural Resources (BLNR), Appellee-Appellee’s, imposition of a $3.8 million penalty against Appellant-Appellant Pilaʻa 400, LLC (Appellant), which was organized by James Pflueger, for damages to Kauai’s Pila`a Beach, the coral reef at the beach, and water quality caused by tons of mud flowing into the ocean from construction on property owned by Appellant.

On appeal, Appellant contends that the circuit court erred by affirming the BLNR order because: (1) the order exceeds the statutory authority of the agency under Hawaii Revised Statutes (HRS) § 183C-3(7) as the agency has no jurisdiction over grading and construction outside the conservation district; (2) the order violates HRS § 91-9(b), because Appellant never received notice that it was being investigated for dumping solid material in a conservation area; (3) the order violates HRS §§ 91-3 and 183C-3(3), because the BLNR and Department of Land and Natural Resources failed to adopt rules establishing methodology for calculating and assessing environmental damages to state land; (4) the order violates HRS § 91-12 because the damage assessment does not include express findings to support the assessment; (5) the order found Appellant responsible for illegal activity of its predecessor; (6) the BLNR failed to follow the recommendations of the hearings officer; and (7) the federal consent decree related to the same incident acts as a full and fair resolution of the State’s claims against Appellant.