2005-10-24_Request_Change_re_Tentative_Subdivsion

Home

r Memorandum to Chris r uen, Director Planning Department October 24, 2005 Page 3 The selling and buying of land by an owner and a purchaser are common-law rights; therefore, statutes and ordinances in derogation of a common-law right must be strictly construed in their prohibitive applications, giving due regard to the purposes of the statutes and ordinances and the evils which the legislature intended to prohibit, and will not be extended beyond the course of the evils sought to be prevented. See Whitlow v. Jennings and Kaneshiro, 40 Haw. 523 (1954). "Restrictions upon the sale of unapproved subdivisions are twofold: (1) for the protection of the public, and (2) for the protection of purchasers of subdivisions." Id. at 528. The purpose of the Hawaii statutes and County ordinances relating to subdivisions is "to prevent the subdividing of large areas into smaller areas for the purpose of sale, lease or rent, without providing for adequate light, air, fire protection, traffic safety and to insure the proper sanitation and drainage of lands. The provision against the owner selling such land without approval is to protect an unwary purchaser who may find he has bought a parcel of land upon which he cannot build, cannot install public utilities, etc., because the lot does not comply with the building ordinances or other health or police measures." Id. at 528. The seller in Whitlow agreed to subdivide and enter into and execute an agreement to sell, and the buyer to purchase a lot, upon the condition that the seller would, in conformity with the statutory requirements, obtain approval of the proposed subdivision by the planning commission of the City and County of Honolulu. It was further agreed that the agreement to sell would be placed in escrow and the agreement to sell would be wholly ineffectual and would not be delivered until final approval by the city planning commission of the proposed subdivision, at which time — and not before - the escrow agreement would be delivered by the escrow holder to the buyer and thereupon take effect. Based on the foregoing facts, the Court held that the escrow agreement did not fall within the purpose of the statute because "(1) the public was fully protected as the contract was of no force and effect until the subdivision was approved by the planning commission; (2) the purchaser was protected for the same reason; and (3) the seller would be protected in that the placing of the agreement in escrow was an assurance that the contract to subdivide, when performed, would not be in vain and the various expenses . . . would not be lost to the vendor." Id. at 532-533. The whole purpose of Section 23-76 and other similar ordinances and statutes is to protect the public and the unwary purchaser from substandard subdivisions. Unlike the escrow agreement in Whitlow, Mr. Bassan's escrow agreement with First American Title Company does not contain a condition requiring the seller to obtain final subdivision approval from the Planning Department before the agreement to sell will be effectual and delivered to the buyer. In other words, the escrow agreement provided to me by Mr. Bassan contains no language which would prevent the conveyance of lots to buyers prior to Mr. Bassan obtaining final subdivision approval from the Planning Department. If, under these circumstances, the Planning Department agrees not enforce Section 23-76, there is no incentive for Mr. Bassan to complete the improvements required for obtaining final subdivision approval, which goes against the w