Hawaiian Properties, Ltd. v. Tauala

254 P.3d 487, 125 Haw. 176, 2011 Haw. App. LEXIS 398
CourtHawaii Intermediate Court of Appeals
DecidedApril 28, 2011
Docket29546
StatusPublished
Cited by1 cases

This text of 254 P.3d 487 (Hawaiian Properties, Ltd. v. Tauala) is published on Counsel Stack Legal Research, covering Hawaii Intermediate Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hawaiian Properties, Ltd. v. Tauala, 254 P.3d 487, 125 Haw. 176, 2011 Haw. App. LEXIS 398 (hawapp 2011).

Opinion

Opinion of the Court by

LEONARD, J.

Defendant-Appellant Regina Tauala (Tauala) appeals pro se from the Judgment for Possession (Judgment) and Writ of Possession (Writ), both filed on November 17, 2008 in the District Court of the First Circuit, Honolulu Division (District Court). 1 The District Court ordered that Plaintiff-Appellee Hawaiian Properties, Ltd. (HPL) was entitled to possession of the premises occupied by Tauala and issued a writ of possession against Tauala.

The threshold issue in this appeal is whether, as Tauala contends, the District Court erred in denying her Motion to Dismiss (Motion to Dismiss) for lack of jurisdiction. Based on the statutory limits of the civil jurisdiction of the district courts, .as previously construed by the Hawai’i Supreme Court, we conclude that, as cooperative member, Tauala had more than a mere possessory interest in the subject premises and her right to occupy her cooperative unit cannot be cancelled or terminated in a district court summary possession action. Accordingly, we vacate and remand.

I. BACKGROUND

A. The Parties’History

For many years, Tauala has lived in unit # 16C of Makalapa Manor Apartments, a Hawaii Cooperative Corporation (Makalapa Manor or the Cooperative), which is located at 99-128 Kohomua St., Aiea, Hawaii. HPL is the managing agent for the Cooperative. It appears that the Cooperative was developed in the early 1970’s, pursuant to financing insured by the federal Secretary of Housing and Urban Development, acting by and through the Federal Housing Commissioner (HUD), and Tauala’s parents bought into the Cooperative in 1971. A HUD-approved document entitled “Makalapa Manor Apartments Information Bulletin (Information Bulletin),” 2 which is cited by both parties in conjunction with the Motion to Dismiss, provides considerable insight into the nature of the Cooperative, including the following (emphasis added):

A subscription for membership in a housing cooperative is more than an application for a place to live. It lends to your participation in the cooperative ownership and operation of a housing project. ... The cooperative approach to housing instills a pride of ownership resulting *178 in a deeper interest in maintaining the property and participating in civic affairs. A cooperative is operated on a democratic basis. It gives the residents a greater insight and appreciation of the democratic process in general. Cooperative residents normally occupy the premises for longer terms than renters ....
Cooperative housing offers the following financial benefits:
(1) The absence from the monthly housing cost of the owner’s profit inherent in most rental projects.
(2) Tax benefits as described later in this Bulletin.
(3) Rental schedules usually include an allocation for vacancy loss. In a cooperative, the monthly charges usually include only such income losses, if any, as have actually been incurred.
(4) Maintenance costs in a well-operated cooperative are minimized since experience has shown that owners take better care of their property. Cooperative members frequently handle the redecoration of their units on a “do-it-yourself’ basis, thus eliminating this as a project expense.
(5) A cooperative is operated on a nonprofit basis. Thus, increases in the monthly housing cost are limited to actual increases in operating costs.
(6) If a cooperative is successfully operated, a modest equity accrued upon resale may result, subject to limitations set forth in the By-Laws.
Your cooperative is receiving the benefit of special financing which Congress provided in Section 236 of the National Housing Act to assist families of lower income and displaced families in meeting their housing needs....
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The cooperative has been incorporated as a nonprofit cooperative housing corporation for the purpose of acquiring, owning, and operating a housing project consisting of town houses the permanent occupancy of which will be restricted to members in the cooperative. If your subscription is accepted by the cooperative and approved by FHA, you will become a member of the cooperative. The cooperative will deliver to you the membership certificate representing your interest in the cooperative not later than the time of initial mortgage closing, provided your cash equity investment has been paid in full in accordance with the terms of the Subscription Agreement. ...
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The funds provided by your subscription and the subscription of other members will constitute the equity investment and are intended to furnish the cost of acquiring the project over and above the mortgage proceeds and to provide working capital funds ...
The cooperative’s members are in effect their own landlord. They pay monthly carrying charges to their cooperative in accordance with the Occupancy Agreement. The cooperative corporation holds title to the property and executes a blanket mortgage. The individual member signs no note or mortgage and has no personal obligation thereunder.
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[] INCOME TAX ADVANTAGES.
(a) In computing his over-all housing cost, the member may wish to consider the benefit of the federal income tax deductions allowed to tenant-stockholders of cooperative housing corporations under the provisions of Section 216 of the Internal Revenue Code. Under this provision, provided 80 percent of the income of the cooperative consists of carrying charges received from its members, the members are entitled to deduct from their gross income their proportionate share of real estate taxes and mortgage interest paid by the cooperative....
(b) A member of a cooperative has available to him the same basic federal income tax advantages available to a home owner who sells his home and purchases a new one. Residence has been defined by the Internal Revenue Service to include a cooperative apartment. If a person sells or exchanges his principal residence at a gain, the gain is taxable. However, if *179 within the year before or the year after the sale, the seller buys and occupies another residence, the gain is not taxed at the time of the sale if the cost of the new residence equals or exceeds the adjusted sales price of the old residence....
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If after taking occupancy you wish to move from the project, you may sell your interest,

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Cite This Page — Counsel Stack

Bluebook (online)
254 P.3d 487, 125 Haw. 176, 2011 Haw. App. LEXIS 398, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hawaiian-properties-ltd-v-tauala-hawapp-2011.