O'Grady v. State., 140 Haw. 36

On March 8, 2007 a rockfall on State Route 11 on Hawaiʻi Island struck the O’Gradys’ car, causing injuries. The accident site had been rated a Class A (highest hazard) by the State’s Rockfall Hazard Rating System (RHRS) since December 22, 2004.
The Hawaiʻi District (responsible for maintaining Route 11) lacked a routine, coordinated, operational-level rockfall-mitigation system, and district maintenance personnel were not integrated with or routinely informed by the RHRS.
The O’Gradys sued the State and DOT for negligence and related claims. At a non-jury liability trial the circuit court found the State owed a duty and breached it, but concluded the plaintiffs failed to prove legal causation and entered judgment for the State.
The circuit court also discussed the discretionary function exception, observing that routine, operational maintenance is not discretionary while large-scale projects contingent on legislative appropriation may be.
The Hawaiʻi Supreme Court held the circuit court misapplied the legal-causation standard (requiring proof that compliance would have prevented the rockfall) and remanded for application of the proper Mitchell two-prong causation test; it also concluded the record did not support application of the discretionary function exception to the operational-level mitigation failure.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the State's breach was the legal/proximate cause of the O’Gradys’ injuries	The State’s failure to maintain an operational rockfall mitigation system was a substantial factor in causing the injuries	The court below should find the State not liable because plaintiffs did not prove that compliance would have prevented the rockfall (and cited funding/prioritization as justifications)	Vacated & remanded: court misapplied causation by requiring prevention; plaintiffs need only prove the State’s breach was a "substantial factor" under Mitchell; factual causation must be reassessed under correct standard.
Whether the discretionary function exception bars liability	The exception does not apply to failure to implement routine, operational rockfall-mitigation measures	The State argued that broader policy/prioritization and resource constraints (and possibly large-scale remediation decisions) implicate discretionary policy judgment	Held: Operational, routine mitigation falls outside the exception; the State bears the burden to prove any discretionary-function defense and did not carry that burden on these facts.

Mitchell v. Branch, 45 Haw. 128, 363 P.2d 969 (Haw. 1961) (adopts substantial-factor test for legal cause)
McKenna v. Volkswagenwerk Aktiengesellschaft, 57 Haw. 460, 558 P.2d 1018 (Haw. 1976) (factual causation and substantial-factor discussion)
Knodle v. Waikiki Gateway Hotel, Inc., 69 Haw. 376, 742 P.2d 377 (Haw. 1987) (rejects but-for instruction that conflicts with Mitchell substantial-factor test)
Taylor-Rice v. State, 91 Haw. 60, 979 P.2d 1086 (Haw. 1999) (articulates Mitchell two-prong test and discretionary-function analysis)
Estate of Klink ex rel. Klink v. State, 113 Haw. 332, 152 P.3d 504 (Haw. 2007) (State duty to maintain roads; breach can be legal cause)
Breed v. Shaner, 57 Haw. 656, 562 P.2d 436 (Haw. 1977) (interpreting the discretionary-function exception and distinguishing operational acts from broad policy decisions)