POSTED: 3 NOVEMBER 2008 - 8:30am HST

HSF Corporation & Hawaii Supreme Court

image above: The battle begins. Detail of poster art for movie "Tropic Thunder".

by Dick Mayer on 30 October 2008

Here is a 2007 article that was written to describe the "Act 2" case that will be heard on appeal at the Supreme Court on December 18, 2008.

Special legislation? Judge didn't think so
by Christie Wilson on 15 November 2007 in The Honolulu Advertiser
Much of the legal debate in court focused on Article XI, Section 5, of the Hawai'i Constitution that states that "legislative power over the lands owned by or under the control of the state and its political subdivisions shall be exercised only by general laws."

Attorney Isaac Hall said Act 2 is clearly "special" — not "general" — legislation designed to solely benefit Hawaii Superferry and specifically grant the company use of 5.1 acres of state land at Kahului Harbor.
State Attorney General Mark Bennett said Article 11, Section 5, has not been subject to court interpretation yet, but that its legislative history shows it was meant to prevent lawmakers from conveying a particular property to a particular recipient. The law was passed likely in response to "sweetheart land exchanges" in territorial days between the state and the "Big Five" corporations, he said.

The attorney general argued that Act 2 is not special legislation because language in the law states that it applies to any "large capacity ferry vessel company." Although that category includes Hawaii Superferry, it would apply to any other ferry company wishing to do business in Hawai'i, so it does not violate equal protection standards, according to Bennett.

" The fact that it may apply only to one party is irrelevant as long as you have set up a class and it is rational ... then it is not special legislation," Bennett said.

He noted the law also does not legislate use of a particular property, since it states that ferry companies can use Kahului Harbor and improvements and facilities on any other islands.

Hall retorted that Bennett was taking the court and others for "village idiots" by arguing that Act 2 was not crafted specifically to salvage Hawaii Superferry.

" There is no one in this whole world who thinks this is anything but 'Superferry legislation,' " he said.
Bennett reminded Maui Circuit Judge Joseph Cardoza of his own words in granting the injunction on Oct. 9 and in a subsequent order, saying, "The obligation of this court is to apply the law as it is written. The court is not authorized to rewrite our laws."

The injunction was based on state law as it existed at the time, Bennett said, but Act 2 changed the law and legislated that the ferry can operate while the review is under way. The legal basis for the injunction has disappeared, he said.

Cardoza agreed with Bennett on every point, saying the governor is authorized to convene a special session, and that Act 2 requires the executive branch to comply with its public trust duties and that compliance with those duties will be closely monitored.

He said Article 11, Section 5, was not relevant to Act 2 since the new law does not involve legislative power over state lands.

Act 2 "is clearly focused on removing large capacity ferry vessel companies from the scope of Chapter 343 and the environmental review process. Whether that reflects good or bad legislative policy is certainly a question that can be discussed, but it does not render Act 2 unconstitutional," Cardoza said.

Although prior court rulings prohibited commencement of Hawaii Superferry before environmental review, the judge said Act 2 removed large capacity ferry vessels from the purview of Chapter 343. In determining that the new law is constitutional, he said he had no option but to dissolve the injunction.

And eleven months later was this article  identifying issues behind the Supreme Court's decision to allow the appeal to skip the Intermediate Court of Appeals.

State Supreme Court to hear Superferry appeal

By Edwin Tanji on 16 October 2008 in The Maui News

Th Legality of state’s environmental exemption key issue. Maui leaders who questioned allowing the Hawaii Superferry to operate before an environmental impact statement is completed said Wednesday they are pleased that the Hawaii Supreme Court has agreed to review the issue.

" We were very happy," said Irene Bowie, executive director of Maui Tomorrow, one of the three community organizations that opposed allowing the Superferry to run before all environmental risks are assessed.

Three Maui state senators who voted against the exemption for the Superferry said they are particularly interested to see how the Supreme Court will rule on the constitutionality of the law approved in a special legislative session in October 2007.

" Shan, Kalani and I felt that the whole process was wrong," said Sen. Roz Baker, who represents the South Maui and West Maui district. "We knew there was great sentiment on Maui that all of the law should have been followed and we felt the Department of Transportation erred in doing it the way it did."

She was joined by Sens. J. Kalani English and Shan Tsutsui in saying that the law approved in a special session after a Maui circuit judge blocked the ferry service appeared to be an exemption for a special interest that violated the constitution.

But when legislators were briefed by the state attorney general last year, Baker said they were told it did not.

The fact that the Supreme Court agreed to hear the case "is a sign that it's a more significant issue that needs to be addressed," English said.

" They are saying it's a major issue that the Supreme Court must decide. It's the right court to give finality to these issues," he said.

Wailuku attorney Isaac Hall, who is representing Maui Tomorrow, the Sierra Club and the Kahului Harbor Coalition in the appeal, said the key issue is whether the special legislation granting an exemption from environmental laws is constitutional.

He noted that the order signed by Chief Justice Ronald Moon grants the transfer to the Supreme Court from the state Intermediate Court of Appeals both on the grounds that the case raises a question of fundamental public importance and because there is a novel legal issue to be addressed.

Hawaii Superferry officials and the state attorney general's office did not respond to requests for comment Wednesday.

The case arises out of a 2007 Supreme Court ruling that the state Department of Transportation should not be making $40 million in harbor improvements to accommodate the Superferry without an environmental assessment, as required by Hawaii law.

The transportation director waived environmental requirements for the harbor improvements or the Superferry operations in signing agreements with Hawaii Superferry in 2004 to provide the harbor facilities.

The Maui groups filed a civil suit questioning the failure to require an environmental assessment. The complaint was initially denied in 2nd Circuit Court. But the Supreme Court in August 2007 held that an environmental assessment was required before the Superferry should be allowed to operate.

When 2nd Circuit Judge Joseph Cardoza granted an injunction blocking the Superferry's operations, Gov. Linda Lingle called the Legislature into special session to consider a bill that granted an exemption to "a qualifying ferry vessel company . . . capable of transporting large capacities of people, motor vehicles and cargo" to allow it to run while an environmental impact statement is prepared.

After a lengthy hearing, Cardoza upheld the new law on Nov. 14, 2007, and lifted the injunction, opening the way for the Superferry to operate into Kahului Harbor.

" It's interesting, " Hall said. "The order to accept the appeal is signed by him (Chief Justice Moon), but is joined by all of the justices."

The case is to be scheduled for oral arguments, but the timing is not yet known, he said.

For Hall, there is another factor that has strong personal interest. In ruling in favor of the injunction based on the original Supreme Court decision, Cardoza granted attorney's fees and costs to Hall. The state and Hawaii Superferry appealed that order, which is part of the new case going to the Supreme Court.

Tsutsui said that he believed the legal disputes could have been avoided if the state administration and Hawaii Superferry had handled public concerns.

" Most of it was avoidable, we felt. If Superferry had been more cooperative in dealing with the community's concerns and some of the questions, we wouldn't be here. There wouldn't be this cloud over the whole project.

" From a business standpoint, it makes sense to cross your t's and dot your i's before you start putting down your money. And you want to embrace your potential customers, make sure they will accept you."

Tsutsui said the legal problems result from a combination of factors.

" I think the Superferry acted on bad information given to them by the Department of Transportation and ultimately the administration," he said. "But again, businesses need to do their own due diligence and their homework before they make commitments of their funds."

English said he objected to the legislation for what he sees as a special interest and he appreciates the court's decision to consider the issue.|

" Our constitution does prohibit special interest legislation and I think that's going to be one of the main issues," he said.

English said if the Supreme Court were to allow the environmental exemption for a business, "I have a number of programs and projects that I can call by their generic names and ask for approval."

Baker said the three Maui senators voiced their opposition to the law to make a statement during the special legislative session.

" The main reason I voted no was that I didn't think that the way the administration had dealt with the whole issue was appropriate. I think it should have gone through the whole process," she said.

Bowie was hopeful that the Supreme Court would invalidate the exemption law, which should result in reinstating the injunction until an environmental impact statement is accepted.

A draft EIS on the harbor improvements to accommodate the ferry operations is expected to be released by the end of October. But it will be subject to comment, and a final EIS still could be subject to legal challenges.

One of the factors will be that the Superferry has been operating, which will provide data on issues such as whether passengers are transporting prohibited products and substances. Bowie said a task force required by the exemption law has been conducting risk assessments that she said "show a lot of weaknesses in the inspection system."

" It validates our position that this is what should have been done right first all along," she said.

Until the Supreme Court takes up the appeal, the Superferry will also continue to operate, Bowie noted, which will provide more information on the safety of the vessel. When the ferry first began regular operations in December 2007, there were severe difficulties with the docking system in Kahului Harbor from the heavy winter swells and the ferry itself incurred damage that put it into dry dock for two months.

" It's October. The whales are back and the swells are back. It's going to be an interesting time," she said.

The Honolulu Advertizer version on the same issue says the action by the Hawai'i Supreme Court means they will get another chance to argue that Act 2 is unlawful." If the court rules that Act 2 is unconstitutional, then the injunction should be reinstated until a real EIS is done pursuant to Chapter 343.

High court takes ferry appeal

by Christie Wilson on 15 October 2008 in The Honolulu Advetiser

Maui groups seek end to law that let ship run before environmental review. The Hawai'i Supreme Court yesterday agreed to hear an appeal seeking to invalidate a state law that allowed Hawaii Superferry to begin operation last year without an environmental impact statement.

The court said it was transferring the case from the lower Intermediate Court of Appeals and would schedule oral arguments because it involves a matter "of imperative or fundamental public importance." A date for arguments was not announced.

The Sierra Club, Maui Tomorrow and the Kahului Harbor Coalition requested the transfer as part of their appeal of a Maui Circuit Court ruling in November that upheld the new law known as Act 2.

The last time the three groups were allowed to present oral arguments before the Supreme Court, they won an uncommonly swift judgment that brought a halt to Hawaii Superferry service.

In that August 2007 ruling, the court said the state Department of Transportation violated environmental laws by not conducting a study of the potential impacts of the new interisland ferry and $40 million in ferry-related port improvements.

A subsequent monthlong trial before Maui Circuit Court Judge Joseph Cardoza resulted in an injunction that prevented the state from allowing Hawaii Superferry to use Kahului Harbor until an environmental impact statement could be completed, a process that could have taken several years.

Company officials said the decision would kill the $250 million enterprise, and the Legislature and Gov. Linda Lingle moved quickly to convene a special session that resulted in Act 2, which exempts "large capacity ferry vessels" from the environmental statute known as Chapter 343. The statute requires an environmental review before a project can proceed.
With Act 2 in place, essentially voiding his earlier ruling, Cardoza dissolved the injunction, rejecting arguments that the new law is unconstitutional because it is "special" legislation designed for the sole benefit of Hawaii Superferry.

The three groups appealed, and yesterday's action by the Hawai'i Supreme Court means they will get another chance to argue that Act 2 is unlawful.

Wailuku attorney Isaac Hall, representing the Sierra Club, Maui Tomorrow and the Kahului Harbor Coalition, said "it's encouraging" the court accepted the case on the grounds that it involves an issue of importance and at the discretion of Chief Justice Ronald T.Y. Moon.

" If the court rules that Act 2 is unconstitutional, then the injunction should be reinstated until a real EIS is done pursuant to Chapter 343," Hall said.

Hall also has argued that Act 2 interfered with a court order, violating the balance of power among the three branches of government, and that elected leaders disregarded their public trust duties under the state constitution to protect Hawai'i's fragile environment and the traditional and customary rights of Native Hawaiians.

The Advertiser was unable to contact state Attorney General Mark Bennett or Hawaii Superferry to comment.

In previous court hearings, Bennett argued that Act 2 is not special legislation because language in the law states that it applies to any "large capacity ferry vessel company," not just Hawaii Superferry.

The ferry resumed service between Honolulu and Maui on Dec. 13 and is operating under more than 40 state-imposed conditions meant to address environmental concerns that include the potential for collisions with humpback whales, the spread of invasive species, and depletion of Native Hawaiian subsistence resources by ferry passengers taking their vehicles and boats to the Neighbor Islands.

In the meantime, the DOT is conducting an environmental study.

see also:
Island Breath: IS Superferry service dissolving
Island Breath: HSF RRA hilites problems
Island Breath: State & HSF task force failure
Island Breath: HSF after the fact EIS
Island Breath: "Tropic Thunder" on Kauai