Honolulu, Hawaii

, 2019


RE: S.B. No. 551

S.D. 1

H.D. 2





Honorable Scott K. Saiki

Speaker, House of Representatives

Thirtieth State Legislature

Regular Session of 2019

State of Hawaii




Your Committee on Judiciary, to which was referred S.B. No. 551, S.D. 1, H.D. 1, entitled:




begs leave to report as follows:


The purpose of this measure is to authorize planned community and condominium associations to use nonjudicial foreclosure to collect delinquencies regardless of the presence or absence of power of sale language in the association's governing documents.


The Hawaii Legislative Action Committee of the Community Associations Institute; Associa; Hawaiian Properties, Ltd.; Anderson Lahne & Fujisaki; Law Offices of Mark K. McKellar, LLLC; Hawaii Council of Associations of Apartment Owners; Collection Section of the Hawaii State Bar Association; Hawaii Kai Peninsula AOAO; Mott Smith Laniloa; Palehua Townhouse Association; Kulana Knolls AOAO; Association of Apartment Owners of the Fairways at Mauna Lani; AOAO Harbour Ridge; and numerous individuals testified in support of this measure. Imanaka Asato, Hui Oiaio, Dubin Law Offices, and many individuals testified in opposition to this measure.


Your Committee has amended this measure by:


(1) Deleting its preamble;


(2) Deleting amendments to chapter 421J (Planned Community Associations) and chapter 514B (Condominiums), Hawaii Revised Statutes;


(3) Clarifying that the explicit grant of power of sale to associations is required for the purposes of enforcing association liens under the association alternate power of sale foreclosure process;


(4) Clarifying that a foreclosing association that acquired a unit through a foreclosure proceeding in violation of the association alternate power of sale foreclosure process between June 28, 2012, and the effective date of this measure, shall be liable for reasonable damages and attorney's fees;


(5) Establishing an association foreclosure task force to review existing foreclosure laws and propose additional solutions that protect the interests of associations and prevent the State's foreclosure laws from unfairly treating unit owners; and


(6) Making technical, nonsubstantive amendments for clarity, consistency, and style.


As affirmed by the record of votes of the members of your Committee on Judiciary that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 551, S.D. 1, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 551, S.D. 1, H.D. 2.


Respectfully submitted on behalf of the members of the Committee on Judiciary,