354 P.3d 436
Haw.2015Background
- DOT-A has leased and operated Dillingham Airfield (federally owned) since 1983 and collects landing fees from commercial users, including Pofolk Aviation Hawai‘i, Inc. and Hale Oʻlele Corp. (collectively Pofolk).
- Statutes at issue: HRS § 261-7(e) authorizes DOT-A to set landing fees (without chapter 91 rulemaking) to keep the statewide airport system self-sustaining; HRS § 261-12(a) grants DOT-A rulemaking authority but states "No rule of the director shall apply to airports or air navigation facilities owned or operated by the United States."
- DOT-A Procedure 4.5.04 § E requires non‑signatory aircraft operators to pay fees "as established by Hawai‘i Administrative Rules (HAR) of the Department of Transportation," and HAR § 19-16.1-3 sets the fee rates.
- In 2012–2013 DOT-A assessed approximately $264,994.99 in unpaid landing fees against Pofolk; Pofolk paid $50,837.99 under protest and sued seeking return, declaratory relief that HAR § 19-16.1-3 (as applied) is invalid under HRS § 261-12(a), and injunctive relief.
- The circuit court denied injunctive relief and entered judgment for DOT-A; the ICA affirmed, deferring to DOT-A’s construction that its procedures (not rules) impose fees and that referencing HAR for rates does not violate § 261-12(a). The Hawai‘i Supreme Court granted certiorari and affirmed the ICA, clarified.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether HRS § 261-12(a)’s ban on application of a "rule of the director" to U.S.-owned/operated airports prohibits DOT-A from imposing landing fees at Dillingham by a procedure that references HAR rates | § 261-12(a) forbids any application of DOT rules to federally owned airports; DOT-A may not rely on HAR rates — fees must be set without reference to DOT rules | DOT-A may impose fees under § 261-7(e) and adopt procedures to collect them; referencing HAR for rates does not mean a prohibited "rule" is being applied to the federal airport | The court held § 261-12(a) does not preclude DOT-A from imposing landing fees at Dillingham via procedures that reference HAR rates; statutes construed together permit DOT-A’s practice |
| Whether § 261-7(e) (authorizing fees without chapter 91) is preempted or contradicted by § 261-12(a) | § 261-7(e) requires setting fees without reference to rules; when statutes conflict, the more specific § 261-7(e) should control and prevent use of HAR rates for federal airports | No irreconcilable conflict: § 261-7(e) removes chapter 91 procedural requirements but does not forbid DOT from using rules for rate detail; reading § 261-12(a) literally would create absurd results | The court held there is no irreconcilable conflict; both statutes can be given effect and a literal reading of § 261-12(a) would yield absurd outcomes |
| Whether DOT-A’s longstanding practice of assessing landing fees at Dillingham merits deference | Agency practice cannot override clear statutory prohibition | Agency’s consistent, unchallenged construction is entitled to weight when statute is ambiguous | The court gave deference to DOT-A’s construction where statute is ambiguous but emphasized independent statutory analysis; DOT-A’s interpretation was not palpably erroneous |
| Whether invalidating DOT-A’s referenced use of HAR rates would be consistent with legislative intent and chapter 261 policies | Literal reading of § 261-12(a) better protects federal operations from state rules | Legislative purpose (self-sustaining statewide airports; broad DOT-A authority to foster aeronautics) supports allowing DOT-A to set and collect fees, including at leased federal fields | The court found the legislative history and chapter 261’s purposes support DOT-A’s authority to impose fees and reference HAR rates; concerns about interfering with federal operations were not implicated here |
Key Cases Cited
- Chun v. Employees' Ret. Sys., 61 Haw. 596, 607 P.2d 415 (1980) (agency construction of its statute is entitled to weight when statute is ambiguous)
- Gillan v. Gov't Emps. Ins. Co., [citation="119 Hawai'i 109, 194 P.3d 1071"] (2008) (statutory interpretation is reviewed de novo; deference to agency interpretation when statute is ambiguous)
- Treloar v. Swinerton & Walberg Co., 65 Haw. 415, 653 P.2d 420 (1982) (consistent, unchallenged administrative practice has persuasive force)
- Norwegian Nitrogen Prods. Co. v. United States, 288 U.S. 294 (1933) (contemporaneous administrative construction of statutes carries weight)
- Schmidt v. HSC, Inc., [citation="131 Hawai'i 497, 379 P.3d 416"] (2014) (literal statutory construction may be rejected where it yields absurd results)
- Kewalo Ocean Activities v. Ching, [citation="124 Hawai'i 313, 243 P.3d 273"] (2010) (contextual aids are used to resolve statutory ambiguities)