RCA Trade Center, Inc. v. Hu

Hawaii Intermediate Court of Appeals·Decided June 23, 2026·No. CAAP-24-0000380·Published

Opinion

Electronically Filed

Intermediate Court of Appeals CAAP-XX-XXXXXXX

23-JUN-2026

03:44 PM

Dkt. 66 OP

NO. CAAP-XX-XXXXXXX

IN THE INTERMEDIATE COURT OF APPEALS OF THE STATE OF HAWAIʻI

---o0o---

RCA TRADE CENTER, INC., a Hawaii corporation; and MP UNIT 21, LLC, a Texas limited liability company, Plaintiffs-Appellants,

v.

WAYNE MASAO MUN KEONG HU, TARA LEIKO HU, Defendants-Appellees, and DOES 1–10, Defendants.

APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT (CASE NO. 1CCV-XX-XXXXXXX)

JUNE 23, 2026

LEONARD, PRESIDING JUDGE, MCCULLEN AND GUIDRY, JJ.

OPINION OF THE COURT BY MCCULLEN, J.

Plaintiffs-Appellants RCA Trade Center, Inc., and MP Unit 21, LLC, (collectively, RCA) appeal from the Circuit Court of the First Circuit's May 20, 2024 order granting Defendants- Appellees Wayne and Tara Hu's (together, the Hus) motion to dismiss brought pursuant to Hawaiʻi Revised Statutes (HRS)

Chapter 634G, the Hawaiʻi Public Expression Protection Act (HPEPA), and May 21, 2024 Final Judgment. 1 On appeal, RCA challenges the circuit court's (1) finding of good cause for the Hus' untimely filing of their HPEPA motion to dismiss, (2) dismissal of its complaint, and (3) award of fees and costs. We affirm.

We hold that the circuit court did not (1) abuse its discretion by finding good cause for the Hus' untimely filing or (2) err by dismissing RCA's complaint under HPEPA. We further hold that (3) RCA waived any challenge to the circuit court's award of attorney's fees.

I. BACKGROUND

A. Factual Background In 2016, the Hus acquired a unit within Marconi Point Condominiums, an agricultural condominium project (the Project) located in Kahuku, Oʻahu, Hawaiʻi. The Project comprises "two (2) lots totaling 96 acres of AG-2 zoned lands" that were "'condominiumized' by the developer into 32 units." "The Project aims to develop agricultural condominiums for active farming and other agricultural operations" and "is not a residential development." "However, zoning laws allow 'farm dwellings' to be constructed within the Project to house individuals engaged in the Project's agricultural operations,

1 The Honorable John M. Tonaki presided.

consistent with what is permitted under applicable zoning ordinances."

In 2017, RCA applied for and received multi-building permits from the City and County of Honolulu's Department of Planning and Permitting (DPP) to construct eight pre-fabricated steel warehouses on their various units within the Project.

Believing the "Project would remain a quiet agricultural condominium project, with few farm dwellings and neighbors" at the time they purchased the unit, the Hus became concerned about "numerous questionable and possibly unlawful activities occurring within the Project" over the next eight years.

These activities — which the Hus believed "substantially changed the nature and character of the Project[] and[] . . . impacted the North Shore Community and the interest of the public with respect to protecting both agricultural lands from non-compliant uses as well as activities that adversely affected the environment" — included (1) the "construction of eight (8) massive metal warehouses . . . on the AG-2 zoned lands[] . . . for the purpose of advertising and leasing spaces . . . to the public for non-agricultural uses"; (2) noncompliance with DPP's special management area and building permit requirements; (3) "hosting illegal and noncompliant uses on AG-2 lands such as 'non-compliant farmers'

markets', 'pop-up markets', weddings, craft fairs, and other social gatherings, some of which utilized [RCA's] warehouse spaces"; and (4) "allowing people vehicular access to the beach areas for 'four-wheeling' in sensitive environmental areas having endangered species."

As to the eight warehouses, RCA "applied for and received a United States Department of Agriculture Rural Development Business and Industrial Guaranteed Loan of $7,883,000" (the Loan) to "finance the construction of the warehouses." According to RCA, the "program does not provide direct funding but only a federal guaranty to secure repayment obligations in the event of a borrower's default." North Avenue Capital was RCA's lender under the program.

Meanwhile, as discussed in more detail below, the Hawaiʻi Legislature adopted the Uniform Law Commission's model Uniform Public Expression Protection Act (UPEPA) as HPEPA in 2022. 2022 Haw. Sess. Laws Act 96, § 1 at 215-16.

Concerned "that the questionable activities put the Project in danger of being investigated and cited by various federal, state and county governmental agencies," the Hus hired Peter J. Lenhart, Esq., to draft a letter to RCA addressing these and other issues.

On August 29, 2023, Lenhart transmitted the "52-page letter . . . together with Exhibits '1' through '17'" (the

Letter) to RCA, its counsel, and ten additional governmental entities, including DPP, the State of Hawaiʻi Department of Land and Natural Resources, the State of Hawaiʻi Department of Agriculture, and the U.S. Department of Agriculture (USDA).

On September 1, 2023, North Avenue Capital contacted RCA for more information about the Letter, which it received from the USDA. Following the USDA's inquiry into the Letter, North Avenue Capital "informed [RCA] that [it] would be putting a hold on draws from the loan proceeds, which were needed to pay for ongoing construction costs."

Although RCA attempted to assuage North Avenue Capital's concerns, in part by filing the instant lawsuit, North Avenue Capital ultimately "declared [RCA] to be in default of [its] obligations under the loan." "Since December 2023, [RCA has] been able to resolve [North Avenue Capital]'s concern, pending USDA consent to the loan modification." 2 B. Procedural Background On October 25, 2023, less than two months after receiving the Letter, RCA filed a three-count complaint against the Hus, asserting causes of action for Declaratory Relief, Tortious Interference, and Injunctive Relief.

Count I (Declaratory Relief) sought a "declaratory ruling that the warehouses may remain on [RCA's] Units, that

2 RCA does not explain how or why the Loan was modified.

[RCA is] not required to remove the warehouse[s] that have already been constructed, and that [RCA] may continue with construction of the warehouses as intended":

COUNT I

DECLARATORY RELIEF

59. Plaintiffs incorporate by reference each of the allegations in all previous paragraphs.

60. A controversy exists between Plaintiffs and Defendants concerning Plaintiffs' construction of the warehouses.

61. Construction of the warehouses is permitted under all applicable laws and the Declaration.

62. A declaratory ruling will serve to terminate the uncertainty or controversy giving rise to this proceeding.

63. Plaintiffs are entitled to a declaratory ruling that the warehouses may remain upon Plaintiffs' Units, that Plaintiffs are not required to remove the warehouse [sic]

that have already been constructed, and that Plaintiffs may continue with construction of the warehouses as intended.

Count II (Tortious Interference) alleged the Hus "intended to purposefully interfere with the contractual relationship among [RCA], [North Avenue Capital], and the federal government":

COUNT II

TORTIOUS INTERFERENCE

64. Plaintiffs incorporate by reference each of the allegations in all previous paragraphs.

65. The USDA Loan constitutes a valid and binding contract among Plaintiff RCA Trade Center, its lender, and the federal government.

66. Defendants have knowledge of the USDA Loan and underlying contractual relationship, in light of the fact that they transmitted their [Letter] to the USDA and questioned the use of federal funds for construction of the warehouses (although as explained above, the USDA has not actually provided any federal funding, only a guaranty).

67. By transmitting their [Letter] to the USDA and other governmental agencies, Defendants intended to purposefully interfere with the contractual relationship among Plaintiff RCA Trade Center, its lender, and the federal government.

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