 Today, we're going to explore the uniquely Hawaiian land tenure system Mark Zuckerberg recently ran afoul of, Kuliana Lands. My guest is the president of the Native Hawaiian Bar Association, Paul F. Nahua Lucas. Mr. Lucas is a licensed attorney, currently serving as senior counsel for the Education Legal Division at Kamehameha Schools, advising Kamehameha on the issues relating to education, employment, intellectual property, and Native Hawaiian rights. Aloha, welcome. And as far as we know, we're not related, but we might be on the Hawaiian side, just not on the Lucas side, if anybody's wondering. Aloha. Nice to be here. Thank you. So Mr. Zuckerberg ran afoul of some, what I understand from you is new legislation or actually old legislation that he was trying to avoid the new legislation from. At any rate, for most people, it's a little confusing what happened. And so thank you for coming and sharing your considerable experience with the Native Hawaiian Legal Corp. You were there for eight years as a staff attorney and another 15 plus as the president for the board. So you've seen this issue of Kuliana Lands from many sides. Yes. We, the Native Hawaiian Legal Corporation, received the grant from the Office of Hawaiian Affairs to represent Native Hawaiians who are defendants in these kind of action. Quiet title action is a legal term. Quiet title is a legal term for determining the title. Who owns the title? And the history of this is that up until OHA provided us with the grant back in the early 80s, there was no kind of work being done. And so many of these Kuliana Lands were being taken through adverse possession and largely for a mere pittance. And some were not even being compensated at all. So Kuliana Lands, where did they come from? What are they? Kuliana refers to, it used to be, it meant Hawaiian, it meant responsibility or interest. After 1850, it referred to a parcel of land, plot of land, which was either a house lot or agricultural land. Usually it was irrigated tarot terraces, which were awarded during the Kingdom in 1850, two years after the Mahele of 1848. And these plots of land had the rights of access to and from a public road. They also had the rights of water. They could use water from a stream and also gathering in undeveloped areas of the surrounding parcels. Of the surrounding parcels, regardless of who the owner was. That is correct. And that is something that is very, very special and unique. And it was created during a time when we were making the transition from our traditional land tenure to our western system of what we know today of a private property ownership. And so these Kuliana are really a thumbprint or an imprint of that traditional land tenure system that existed and oftentimes was inconsistent and conflicted with the subsequent commercial use of the surrounding lands, which was for sugar, for ranching, etc. So are there a lot of Kuliana lands? The total number of Kuliana lands that were awarded back during the pursuant to the act of August 6, 1850, was approximately 100,000 acres statewide. So it's very little, but they are scattered throughout the state. And some of them range as small as a quarter acre, all the way up to six, seven, eight acres. Any idea how many of them there are? That still exists today? No, I haven't done an inventory of them, so not pretty sure. So it was set up as a way of integrating traditional Hawaiian land, didn't have land tenure, actually, in the Kingdom days. Yes, when they set up this transition period, they said if you want to file a claim for a fee simple title to land, you need to file it within a two-year period, which is 1846 to 1848. And so everybody filed both chiefs and tenants. Now you can imagine at that time there was this cultural, you know, learning curve about, you know, do I really get to own land? And for some, they made the transition well. For others, it was a real struggle. Who claims, sometimes you had the head of the household claiming on behalf of 15 or 16 family members, whereas maybe, you know, you'd say why doesn't everybody claim? Well, culturally it was for the elder or the head of the household to make that claim. And the concept of ownership wasn't exactly a familiar one. That's right. If you look at some of the early land records and the claims that are filed, many of the tenants claim use rights as opposed to title. They say, well, I would like to use that spring. I would like to use that holla tree over there because I always gather my low holla to make my mats. I would like, and so you have all of these use rights, which in real property law really doesn't guarantee the preservation of that particular resource. And so this was started actually by King Commander, the third, Kauikea Oli, who received interesting a lot of opposition from his privy council, his Ahaku Kamalu, the chiefs, because they did not want to recognize all of these rights that involved going out to someone else's property to go into Maoka, go down to the shoreline, getting rights of water. But Kauikea Oli was very insistent and said, if these people do not have these type of rights, the land that we award them is valueless. And so let us give them that. And that's what we have to do. It's amazing, amazing way of taking care of this really thorny problem of integrating to really different systems. So as the years have gone on, and families have generations, the interest has come down to small, small percentages, and that's presented problems. Can you talk about how the Kuyana lands have, the work that you did at Native Hawaiian Legal Corp, for instance, in helping families who are facing problems, either they don't know where they are or who owns the rest of it. So what have you had to do? Well, typically what happens is the landowner who seeks to quiet title a piece of property has to publish it in the newspaper, and that's where most of our clients at Native Hawaiian Legal Corp would see their name or the name of an ancestor or family member would tell them, hey, look, I saw your auntie's name in the paper. Go check it out. And that's required by law. They have to give notice to everybody. And that's part and parcel of the course. Oftentimes it costs money to hire an attorney to be represented, going to court. And so that's what was the purpose of this grant that we received from the Office of Hawaiian Affairs. And since the early 1980s, Native Hawaiian Legal Corporation has been the defender and protector for land titles. We go in there. Sometimes they wouldn't know how they are connected genealogically. We would assist them by doing genealogical searches in the Department of Health and Bureau of Conveyances, also checking on the land title to make sure that their ancestor did not convey it out so that the interest still passed down to them. And these types of fractionated interests are actually quite common among our Juliana owners. And it's just due to the nature of it. And it's not unique in other indigenous communities. For example, Indian tribes, they receive allotments from the federal government. They have the same issues where the interest just gets fractionated as it gets handed down. The states are not probated. And people have to make a decision one way or the other about what to do with the property because it does become unwieldy. And every family is different as to how they approach these problems. But you have issues about one line is paying the taxes for other people. We call them the deadbeat relatives. They don't pay, but yet they don't want to give up their interest or sell. And so it becomes a stalemate. We have people who want to use the property, others who don't, but they don't want that person to be living on the property. So what do you do? So what do you do? Well, the law says that you can file what's called a quiet title and partition action. That's one of the ways legally to force the determination of owners of the property. That's the quiet title piece of it. And then the second piece of it is a partition. And the partition statue up until very recently said that the court could look at a lot of different factors. He or she, the judge could look at whether it could be partitioning kind, which meant you would cut it up into a physical piece for that particular co-tenant based on their interests, or they could sell it. And the sale was usually at public auction on the steps of a courthouse to the highest bidder. That law has since changed. It did not favor the Kuliana owner, because essentially what it did was it forced someone that had a lot of money. It could be one of the co-tenants, or it could be somebody at the end when it went to public auction to just purchase the Kuliana and share the proceeds, or pay off the owners, and then have clear title to the property. So just to make sure I understand, if they showed up for an auction, and how did that work? How did the judge just said, okay, well, we have to go to auction, or it automatically went to auction if they didn't have large enough parcels to divide? Well, what they would try to do, if they wanted to get a better price, they could negotiate among all the owners, and they have to agree to have it at a sale, a private sale. But if not, the court would then establish, would appoint a real estate commissioner, and that commissioner would then have the property appraised, get a minimum upset price based on the appraised property, and then have an auction, and they'd go to the steps of the courthouse and say, this is the minimum upset price, and then the bidding would start. And so Uncle Joe had no way to hold on to the piece of property? That's correct. You could. Even though he'd left that, been living there his whole life. That's correct. You could consolidate your interests, and then, based on what the fair market value was, you could take that percentage of interest and use that as a credit bid. But basically, if you had somebody that had more money, and power, and who wanted a piece of property, and I'll bid you, it went to the high bidder. That was it. But something changed last year. What changed? Well, there was a recent amendment to the partition phase of the property side of the law, and it took effect January of this year, and it's called the Uniform Partition of Ayers Property Act. And it's a series of the uniform property laws, or uniform laws that are usually adopted by these commissioners nationwide, and then they propose it for use, and then it's up to the states as to whether or not they want to adopt it. And so Hawaii passed this line in July of last year to take effect as of January 1st, 2017. Well, and then that sort of erupted all over the headlines with Mr. Zuckerberg trying to get his issues settled, just to help educate people here. We have a picture of the paper. So that was set off by this new law, and we're going to take a little break, and then come back and explore the issue further. Thank you. Aloha. My name is John Waihei, and I used to be a part of all the things that you might be angry at. I served in government here and may have made decisions that affects you. So I want to invite you in. I want to invite you in to talk story with me and some very special guests every other Monday here at Talk Story with John Waihei. Come on in, join us, express your opinion, learn more about your state, and then do something about it. Aloha. Hello, I'm Marianne Sasaki. Welcome to Think Tech Hawaii, where some of the most interesting conversations in Honolulu go on. I have a show on Wednesdays from one to two called Life in the Law, where we discuss legal issues, politics, governmental topics, and a whole host of issues. I hope you'll join me. Welcome back to Hawaii is my mainland. I'm Kaui Lucas, and with me here is Paul F. Nathalutus, who is the president of the Native Hawaiian Bar Association, and doing a very good job explaining the intricacies of our unique title and quiet title issues here. Thank you so much. So you were just explaining about the partition part of this, where a Kuyana owners might have to sell at an auction if there wasn't something else worked out among them. Yes, and so the old law basically said that you could ask that the property be partitioned in kind, which is everybody gets a piece, but if the property is too small and cannot be legally subdivided, then the court would be forced to consider a sale. So why might Mr. Zuckerberg have wanted to use this? I don't know all the facts to the case, except I do know that he did buy a large tract of land on Kaua'i, and that I guess there are many of these Kuliana that are in within his parcel, his larger parcel. I think for most people who purchase these tracts, and maybe you're not familiar with the history of land title in Hawaii, it is an inconvenience. They do not like to see people crossing their lands at any time of the day, any hour of the night. Maybe they don't like their laundry that's being hung out to dry, where they can see it from their million-dollar estate. I don't know those reasons, but that's usually for ranches and plantations. A lot of them historically founded an inconvenience in developing the property, making paddocks, whether it be paddocks or be plantation acreages. It was just a real inconvenience to provide access within these commercial parcels to the Kuliana owner, put a fence or put some kind of buffer around those parcels because they did not have title to them. And so that's what I guess was the motive. For other owners that are co-tenants within the parcel, oftentimes it's, as I explained earlier, it's a historical inability to get cooperation among the tenants to develop the property. Lack of paying property taxes is one of the factors. So we have some... There's many different reasons. So there's the change that you explained in the partition law and that the reason Mr. Zuckerberg filed when he did, evidently we don't know for sure, was to fall under the old law. And what is... So the new law has come forth. And how do you see this impacting Native Hawaiians? Well, so going back to your point, if he was a co-plaintiff in this lawsuit, then he had to have purchased an interest in that Kuliana. Otherwise, if you're a surrounding land owner, you cannot force the Kuliana owners to go through this quiet title action. Okay, that's an important point. So he had to have purchased an interest from somebody. And that basically, we have seen this time and time again where somebody purchases an interest, then goes through this process. And at the end, stands waiting to outbid anybody at the courthouse. And then once that's done, properties transferred over, the title is transferred over and it is subsumed into the larger award. Okay, so the new rules are what? So the new rules, the Uniform Partition Affairs Property Act, which goes into effect as of January 1st, really attempts to kind of rein in that ability to force the sale to someone if the co-tenants, primarily families that have owned the property for a long time, desired to make some use of it, desired to keep it. And so a lot of the controls that are in the new law is, for example, if somebody is requesting a sale, the judge has to look at that, has to appoint a non-biased real estate appraiser, has to conduct the sale fairly, make sure that everybody is paid. If there are unknown heirs, they have to set aside that amount in the event that they do come forward at a later point in time. The co-tenants can mobilize and the law says, I believe it's 20% of the co-tenants, if they feel like they want to keep the property, if there is a sale, they can then ask the person who is initiating the sale, we would like to buy out your interest. And so it's almost like a first right of refusal. But there are a lot more checks and balances. The court cannot just automatically say, okay, we can't subdivide this legally under the county zoning and building code standards. We have to sell it. They have to look at other factors. And one of them is like the cultural tie, historical ties that the co-tenants have to the property, which before that was not a consideration. It's now a consideration of the law. So it makes it a lot more difficult for them to determine and sell the property. So do you have any idea if it's been used to the new law? Has it been tried yet in the courts? Being that it's so new and not to my knowledge, not to my knowledge. And it's going to be real interesting to see how courts interpret this. So who pays for all of that process? That sounds sort of expensive. You know, having the courts look into the case, is the state paying for it? Who pays for it? Well, usually the court, it will come to the court on appeal and that's when the court will issue some kind of pronouncement as to what the law is and because the courts are the interpreters of the law. And so it will not happen usually unless there is a dispute and someone takes this to court and is dissatisfied for whatever reason with the outcome and chooses to appeal. Okay. And then we've seen as a result of all of the attention and who knew that it would be an international sensation, dear Pila, that there's been legislation proposed. And I think you might have had a chance to look a little bit at these new bills that are making their way in the legislature. Can you speak to that a little bit? Yes. There's one bill that would require that the court order mediation to try and, I guess, resolve the claims that are before the court. And the other law escapes me right now, but not the law, but the proposed legislation. But they call into question, I mean, the ability, I mean, it gets, as we had discussed earlier, raises questions, I think, from a property interest because we're so, we're our Western system, property ownership is so strong that basically these new proposed legislations are basically telling the property owner what they can and cannot do with their property. And I think that it could be subject to some kind of constitutional challenge. I think I am remembering it that one of the bills insists that you, that the person bringing the action have 50% or more. Yes. Okay. So I don't know what it is now. Is that the 20%? Yeah, the 20% is actually for the partition phase of it, but actually anybody that has any interest can bring. So thank you for pointing that out. So the 50% then sets a greater threshold. So it says, if I have 1% of the property, I could not file an action to have my have my interest determined and possibly sold and get and get compensated for it, because I didn't have, you know, I didn't meet the minimum threshold set by the law. And, you know, I'm not saying that it's, it's, it's, you know, the challenge has merit, but I'm, but I'm sure that that that it's going to raise those kind of issues. It's going to raise the issues as far as how do you see this? I know you're just jumping into it right now, but can you think as a, as an attorney who's been dealing with these kind of things, how it might play out in the low E. I mean, in the real world of Hawaiian families who are dealing with Kuliana title. I mean, how does that, how does that, how does that work? If you're a family and, and you have all these heirs and you don't know where they are, but you know, there's the, there's the handful, right? That have been there and are showing up and, you know, really planting the low E and, and doing the harvest and doing it and then, you know, uncle from Cincinnati comes back and says, Hey, wow, this is pretty cool. I want to do something here. Or just the opposite. Why is he there? And, you know, he shouldn't be doing this. Right. I think it's a, it's a, it's a very thorny issue and there's no easy solution to it. I think what we tried to do, and I think we still, still do at, at the native point legal corporation was, we encourage the families to form what we call land trusts. And they're similar to like the large land trusts like, you know. Trust for public land? No. Private land trusts like, like, or, or a charitable trust like, like Kamehameha Schools or, or, or Queen Emma or Queen Delio Coloni. But having it organized, let's say you have 800 people, people who have an interest. What the land trusts would do is they would say, okay, you take all that interest and you convey it into this land trust. And in exchange, you get shares. And so your trustees and then, and then each family member or however the family wants to organize it, gets to elect trustees and those trustees will then manage the property. So you'll have eight trustees as opposed to 800. Well, thank you so much, Paul, for explaining this thorny issue. And this is a picture of your book that I have been enjoying for years. And good luck. And I hope that we can have you back at ThinkTex another time. All right. Pleasure to be here. Thank you, Koie.