REPORT TITLE:
Homestead


DESCRIPTION:
Changes homestead lease amounts to $1.  Eliminates cash freehold
agreements.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        
THE SENATE                              S.B. NO.           453
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO HOMESTEAD LEASES.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  Section 171-99, Hawaii Revised Statutes, is
 
 2 amended to read as follows:
 
 3      "171-99  Continuation of rights under existing homestead
 
 4 leases, certificates of occupation, right of purchase leases and
 
 5 cash freehold agreements.(a)  Issuance of land patents to
 
 6 occupier or lessee of homestead lands.  A fee simple patent shall
 
 7 be issued to every existing occupier under a certificate of
 
 8 occupation issued heretofore, and to every lessee under a nine
 
 9 hundred and ninety-nine year homestead lease issued heretofore,
 
10 of public lands, where the lands have been improved under the
 
11 certificate or lease, or have been used as a place of residence
 
12 by the occupier or lessee for an aggregate continuous period of
 
13 not less than ten years upon payment to the board of land and
 
14 natural resources of a [fair market price, disregarding the value
 
15 of the improvements made by the occupier or lessee, which price
 
16 shall be determined by appraisal as provided for in this
 
17 chapter;] $1; provided that the board may exclude from such
 
18 patents areas required as roadways to other lots.
 
19      (b)  Issuance of patent, lessee of right of purchase lease.
 

 
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 1 The lessee of any existing right of purchase lease shall, at such
 
 2 time and under such conditions as are contained in the lease, be
 
 3 entitled to a land patent from the board conveying to the lessee
 
 4 a fee simple title to the land described in the lessee's lease
 
 5 upon the payment of [the fair market price of the land as
 
 6 determined by appraisal as provided for in this chapter,] $1;
 
 7 provided the lessee has reduced to cultivation twenty-five per
 
 8 cent of the premises and has resided thereon not less than two
 
 9 years and has substantially performed all other conditions of the
 
10 lessee's lease.
 
11      [(c)  Cash freeholds, agreement, patent, conditions.  At the
 
12 end of three years from the date of the payment of the first
 
13 installment, the holder of a freehold agreement is entitled to a
 
14 land patent for the premises described therein, if the following
 
15 conditions, in addition to those set forth herein, have been
 
16 substantially performed:
 
17      (1)  Payment of the balance of the purchase price in equal
 
18           installments, in one, two, and three years
 
19           respectively, from the date of the freehold agreement
 
20           with interest annually at the rate of four per cent;
 
21           provided that the freeholder may pay the installment
 
22           before it is due, and thereby stop the corresponding
 
23           interest;
 

 
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 1      (2)  Cultivation of not less than twenty-five per cent of
 
 2           the area of the premises, and the planting and care of
 
 3           not less than an average of ten timber, shade or fruit
 
 4           trees per acre, if agricultural land, at any one time
 
 5           before the end of the third year, or fencing in the
 
 6           same if pastoral land within such time; provided that
 
 7           if the premises are classed as pastoral-agricultural
 
 8           land, the foregoing alternative conditions shall apply
 
 9           respectively to the two kinds of land;
 
10      (3)  Maintenance by the freeholder of the freeholder's home
 
11           on the premises from the end of the first to the end of
 
12           the third year;
 
13      (4)  Conditions for the prevention of waste, the planting of
 
14           trees or the protection of trees growing or to be
 
15           planted on the premises, or for the destruction of
 
16           vegetable pests that may be on such premises or the
 
17           prevention of the future introduction of such pests
 
18           thereon;
 
19      (5)  Payment of all taxes that may be due on account of the
 
20           premises.
 
21      The holder of a freehold agreement shall allow the land
 
22 agents to enter and examine the premises at all reasonable times
 
23 to see that the conditions are being performed.  The holder shall
 

 
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 1 not assign or sublet, conditionally or otherwise, the holder's
 
 2 interest or any part thereof, under the freehold agreement,
 
 3 without the written consent of the board indorsed on the
 
 4 agreement; and provided further that freeholders having the whole
 
 5 interest in a freehold agreement may at any time when all the
 
 6 conditions thereof to be performed by the freeholder up to such
 
 7 time shall have been substantially performed, surrender to the
 
 8 government the interest by delivery of the freehold agreement to
 
 9 the land agent with the intention to surrender the same clearly
 
10 indorsed thereon, and signed by them and duly attested.  The
 
11 surrender shall release the freeholders from all further duty or
 
12 performance of the conditions of the instrument surrendered.  But
 
13 no such surrender shall be permitted if any freeholders are under
 
14 the age of eighteen years unless the minors are represented by
 
15 statutory guardians; and provided further that any freeholder
 
16 over the age of eighteen may assign the freeholder's interest to
 
17 the freeholder's cotenants.
 
18      (d)  Right of purchase lease; termination, forfeiture, or
 
19 surrender.  Upon the termination of a right of purchase lease by
 
20 lapse of time, or upon the forfeiture or surrender of the lease
 
21 or a freehold agreement, the board may in its discretion and
 
22 within the limit of its authority open the premises or any part
 
23 thereof for disposition in the manner or for such uses as
 

 
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 1 provided in this chapter.  Before the disposition the fair market
 
 2 value thereof shall be established by appraisal.  The value
 
 3 attributable to the improvements in the appraisal shall be paid
 
 4 to the surrendering lessees or freeholders, upon resale of the
 
 5 premises, and the director of finance shall pay the amount of the
 
 6 valuation upon the requisition of the board out of such funds.
 
 7      (e)] (c)  Interests, descent; certificate of occupation or
 
 8 homestead lease.  In case of the death of any occupier or lessee
 
 9 under an existing certificate of occupation or existing homestead
 
10 lease, all the interest of the occupier or lessee, any
 
11 conveyance, devise, or bequest to the contrary notwithstanding,
 
12 in land held by the decedent by virtue of such certificate of
 
13 occupation or homestead lease shall vest in the relations of the
 
14 decedent as follows:
 
15      (1)  In the widow, widower, or reciprocal beneficiary;
 
16      (2)  If there is no widow, widower, or reciprocal
 
17           beneficiary, then in the children;
 
18      (3)  If there are no children, then in the widows, widowers,
 
19           or reciprocal beneficiaries of the children;
 
20      (4)  If there are no such widows, widowers, or reciprocal
 
21           beneficiaries, then in the grandchildren;
 
22      (5)  If there are no grandchildren, then in the parents or
 
23           surviving parent;
 

 
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 1      (6)  If there are no parents or surviving parent, then in
 
 2           the sisters and brothers;
 
 3      (7)  If there are no sisters and brothers, then in the
 
 4           widowers, widows, or reciprocal beneficiaries of the
 
 5           sisters and brothers;
 
 6      (8)  If there are no such widowers, widows, or reciprocal
 
 7           beneficiaries, then in the nieces and nephews;
 
 8      (9)  If there are no nieces or nephews, then in the
 
 9           widowers, widows, or reciprocal beneficiaries of the
 
10           nieces and nephews;
 
11     (10)  If there are no such widowers, widows, or reciprocal
 
12           beneficiaries, then in the grandchildren of the sisters
 
13           and brothers;
 
14     (11)  If there are no grandchildren of any sister or brother,
 
15           then in the State.
 
16      All the successors, except the State, shall be subject to
 
17 the performance of the unperformed conditions of the certificate
 
18 of occupation, or the homestead lease, in like manner as the
 
19 decedent would have been subject to the performance if the
 
20 decedent had continued alive; provided that if a widow, widower,
 
21 or reciprocal beneficiary, in whom the interest shall have
 
22 vested, shall thereafter marry again and decease leaving a
 
23 widower, widow, or reciprocal beneficiary and a child or children
 

 
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 1 of the first marriage surviving, the interest of the deceased
 
 2 shall vest in such child or children; and provided further that
 
 3 in case two or more persons succeed together to the interest of
 
 4 any occupier or lessee, according to the foregoing provisions,
 
 5 they shall hold the same by joint tenancy so long as two or more
 
 6 shall survive, but upon the death of the last survivor, the
 
 7 estate shall descend as provided above.
 
 8      [(f)] (d)  Option of cotenant to compel others to buy or
 
 9 sell.  In case two or more persons become cotenants under any
 
10 existing right of purchase lease, certificate of occupation, or
 
11 homestead lease by inheritance or otherwise, any one or more of
 
12 such persons less than the whole number may file in the office of
 
13 the land agent an offer to the remainder of the persons to buy
 
14 their interest in the premises or to sell them their own interest
 
15 therein at a stated price according to the proportion of the
 
16 respective interest in question, and may deposit with the land
 
17 agent the amount of the offered price in money, with a fee of
 
18 $10.  The land agent shall thereupon notify the persons to whom
 
19 the offer is made of the nature of the offer and order them to
 
20 file with the land agent their answer within sixty days whether
 
21 they will buy or sell according to the offer.  If the persons to
 
22 whom the offer is made file with the land agent within sixty days
 
23 of the time of their receiving the notification, their answer
 

 
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 1 stating that they will sell their interest according to the terms
 
 2 of the offer, the land agent shall indorse the fact of the sale
 
 3 with the amount of the consideration on the lease and pay to such
 
 4 persons the amount of the consideration deposited with the land
 
 5 agent according to their individual interest; and the interest of
 
 6 such persons shall thereupon vest in the persons making the
 
 7 offer.  The fact of the transfer shall be properly recorded in
 
 8 the official records of the land agent and indorsed upon the
 
 9 lease held by the lessee.
 
10      If, however, the persons to whom the offer is made fail to
 
11 answer within sixty days from the time of their being notified of
 
12 the offer or within sixty days from the time the notice of the
 
13 offer mailed to their last known place or places of abode, or
 
14 shall answer within sixty days that they will buy the interest of
 
15 the persons making the offer on the terms offered, but fail
 
16 within sixty days after the notification to deposit the amount
 
17 representing the value of the interest according to the terms
 
18 offered, their interest shall vest in the persons making the
 
19 offer and the amount of the consideration shall be paid by the
 
20 land agent of them individually or their respective
 
21 representatives upon application.  In such case the fact of the
 
22 transfer shall be recorded and indorsed as above provided.
 
23      In the event that any funds held by the land agent hereunder
 

 
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 1 may not be paid to the persons to whom properly payable, because
 
 2 of the inability of the land agent to locate such persons, the
 
 3 funds shall, after the expiration of one year, be deposited in
 
 4 the department of budget and finance of the State and there abide
 
 5 the claim of any person thereto lawfully entitled; provided that
 
 6 no claim to the funds shall be allowed unless the claim is made
 
 7 within five years after the deposit.  Payment of any claim duly
 
 8 filed may be made if the department of budget and finance and the
 
 9 board concur in finding the claim valid and proper, but if the
 
10 claimant fails to obtain concurrency of the department of budget
 
11 and finance and the board within sixty days of the filing of the
 
12 claimant's claim, the claimant may present a petition to the
 
13 circuit court of the first judicial circuit in that behalf,
 
14 notice whereof shall be given to the attorney general, who may
 
15 appear and defend on behalf of the State, and if the court
 
16 renders a judgment in favor of the claimant, the department of
 
17 budget and finance shall pay the amount due without interest.
 
18      But if the persons to whom the offer is made shall, within
 
19 sixty days from the time of the notification, make answer to the
 
20 land agent that they will buy the interest of the offering
 
21 parties and shall deposit within sixty days with the land agent
 
22 the amount required for the purpose according to the terms of the
 
23 offer, the land agent shall indorse and record the fact of the
 

 
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 1 sale as above provided, and pay to the offering parties the
 
 2 amount according to their individual interest; and the interest
 
 3 of the offering parties shall thereupon vest in the answering
 
 4 parties.  In such case the consideration money deposited by the
 
 5 offering parties shall be returned to them.
 
 6      [(g)] (e)  Forfeiture; existing certificate of occupation or
 
 7 homestead lease.  The violation of any of the conditions of any
 
 8 existing certificate of occupation or homestead lease shall be
 
 9 sufficient cause for the board upon failure of the occupier or
 
10 lessee within a reasonable period of time to remedy the default
 
11 after notice thereof in the manner provided in section 171-20 to
 
12 take possession of the demised premises without demand or
 
13 previous entry, with or without legal process, and thereby,
 
14 subject to section 171-21, terminate the estate created.
 
15      [(h)  Forfeiture; cash freeholds.  In the case of default in
 
16 the payment of any of the installments due on any cash freehold
 
17 agreement for thirty days after the same are due, or failure of
 
18 performance of any other conditions, the board may take
 
19 possession of the premises, upon failure of the freeholder within
 
20 a reasonable period of time to remedy the default after notice
 
21 thereof in the manner provided in section 171-20 without demand
 
22 or previous entry, with or without legal process, and thereby
 
23 subject to section 171-21, terminate the estate created.]"
 

 
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 1      SECTION 2.  Section 171-100, Hawaii Revised Statutes, is
 
 2 amended by amending subsection (a) to read as follows:
 
 3      "(a)  The office of Hawaiian affairs may establish a
 
 4 successor determination program to assist persons with an
 
 5 interest or presumed interest in a nine hundred ninety-nine-year
 
 6 homestead lease to determine their legal interests under the
 
 7 provisions of section 171-99[(e).] (c)."
 
 8      SECTION 3.  Section 532-2, Hawaii Revised Statutes, is
 
 9 amended to read as follows:
 
10      "532-2 To heirs.  Whenever any person dies intestate, his
 
11 property, both real and personal, of every kind and description,
 
12 shall descend to and be divided among his heirs, as in this
 
13 chapter prescribed; provided that upon the death, testate or
 
14 intestate, of any occupier or lessee of public land, holding
 
15 under an existing certificate of occupation or an existing nine
 
16 hundred and ninety-nine year homestead lease, succession to the
 
17 decedent's interest in such land shall be determined as provided
 
18 in section 171-99[(e).] (c)."
 
19      SECTION 4.  Statutory material to be repealed is bracketed.
 
20 New statutory material is underscored.
 
21      SECTION 5.  This Act shall take effect upon its approval.
 
22 
 
23                           INTRODUCED BY:  _______________________