Carmichael v. Board of Land and Natural Resources., 506 P.3d 211

Background

In 2000 the Board of Land and Natural Resources (BLNR) issued four one‑year revocable water permits to Alexander & Baldwin/East Maui Irrigation (A&B/EMI) for ~33,000 acres in East Maui, authorizing diversion of >100 million gallons/day and deliveries to HC&S and Maui County; the permits cited HRS §171‑58.
After suspension of a proposed 30‑year lease, the permits were placed on “holdover”/annual continuation status (via DLNR master lists) and were continued year‑to‑year through the BLNR continuation decision of December 12, 2014 (extending month‑to‑month into 2015).
Petitioners (Nā Moku, private plaintiffs) sued in 2015 alleging HEPA (HRS ch. 343) violations because no Environmental Assessment (EA) had been prepared for the ongoing diversions; they sought declaratory and injunctive relief and invalidation of the permits.
The circuit court granted petitioners’ partial MSJ, holding the long‑continued revocable permits exceeded BLNR authority under HRS chapter 171 and were invalid; the ICA vacated and remanded, finding HRS §171‑55 could authorize continuations and that its “notwithstanding” clause nullified HEPA for such permits.
The Hawai‘i Supreme Court vacated the ICA decision in part: it held (1) BLNR’s 2014 continuation was not supported under HRS §171‑55 because BLNR failed to make required “best interests” findings and discharge its public‑trust duties, and (2) HEPA does apply because A&B’s water development/diversion/use is a HEPA “action” involving use of State lands; the case was remanded to determine exemption and remedy issues.
The Court also applied the mootness exceptions (capable of repetition yet evading review and public interest) to decide the merits despite the 2014 permit period having expired.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Does HEPA apply to the continued revocable permits / water diversions?	The A&B diversions are an applicant "action" that proposes use of State lands and thus require an EA under HRS ch. 343.	HRS §171‑55 (and the continuing‑permit process) either preclude HEPA review or the continuations merely preserve the status quo and are not HEPA "actions."	HEPA applies: the permitted development/diversion/use is an "action" under HEPA and involves use of State lands; remand to determine exemptions and EA/EIS needs.
Does HRS §171‑55’s "notwithstanding any other law" clause override HEPA and permit indefinite renewals despite §171‑58’s one‑year cap?	§171‑55 does not nullify HEPA and §171‑58 limits water permits to one year; the notwithstanding clause only clarified authority to avoid public auction.	§171‑55 authorizes month‑to‑month continuances for additional one‑year periods and its notwithstanding clause supersedes conflicting laws (including HEPA and §171‑58 limits).	§171‑58 limits temporary water dispositions to a maximum of one year; §171‑55 does not nullify HEPA and cannot be read to evade environmental review.
Was BLNR’s 2014 continuation authorized under HRS chapter 171 and the public‑trust duty?	BLNR exceeded its authority by effectively allowing decades‑long continuance without findings; permits are invalid.	BLNR acted within §171‑55, pursuant to the public trust, and the continuance was routine and necessary.	BLNR did not make required factual findings that continuances "serve the best interests of the State" or otherwise show proper exercise of discretion as public trustee; 2014 continuation not authorized on that record.
Is the case moot?	Exceptions apply because continuations are annually renewable (evade review) and the issue is of broad public interest.	Case is moot: permits expired, circumstances changed (sugar ceased, DEIS published), and no effective remedy remains.	Mootness exceptions apply (capable of repetition yet evading review; public interest), so the Court reached the merits.

Key Cases Cited

Villaver v. Sylva, 145 Hawaiʻi 29, 445 P.3d 701 (Haw. 2019) (summary‑judgment standard)
Nu‘uanu Valley Ass’n v. City & Cnty. of Honolulu, 119 Hawaiʻi 90, 194 P.3d 531 (Haw. 2008) (summary‑judgment principles)
State v. Wheeler, 121 Hawaiʻi 383, 219 P.3d 1170 (Haw. 2009) (statutory interpretation rules)
Citizens Against Reckless Dev. v. Zoning Bd. of Appeals, 114 Hawaiʻi 184, 159 P.3d 143 (Haw. 2007) (statutory construction guidance)
Umberger v. Dep’t of Land & Nat. Res., 140 Hawaiʻi 500, 403 P.3d 277 (Haw. 2017) (what qualifies as a HEPA "action")
Kauai Springs, Inc. v. Planning Comm’n of Kauai, 133 Hawaiʻi 141, 324 P.3d 951 (Haw. 2014) (public‑trust duties and agency obligation to show exercise of discretion)
In re Water Use Permit Applications, 94 Hawaiʻi 97, 9 P.3d 409 (Haw. 2000) (distinguishing protected trust purposes from private commercial use)
Pit River Tribe v. U.S. Forest Serv., 469 F.3d 768 (9th Cir. 2006) (lease extensions do not necessarily "merely preserve the status quo")