Kaho'ohanohano v. State, 114 Haw. 302

Summary

The Hawai'i Supreme Court considered challenges to Act 100 of the 1999 legislative session, which retroactively applied certain Employees' Retirement System investment earnings to offset employer contributions. The court held that the individual plaintiffs lacked standing, but that the ERS trustees had standing and were entitled to summary judgment on their claim that Act 100 violated article XVI, section 2 of the Hawai'i Constitution by impairing accrued retirement benefits. The case was remanded for further proceedings on the trustees' remaining claims.

Holdings

1. The individual plaintiffs and SHOPO lacked standing because they failed to demonstrate an actual or threatened, distinct, and palpable injury to themselves or their members resulting from Act 100.
2. The ERS Trustees had standing as fiduciaries to challenge Act 100 because they alleged an actual or threatened injury to the ERS and its funds, the injury was fairly traceable to Act 100, and declaratory or injunctive relief could redress it.
3. The Trustees' claims for declaratory relief were not moot because a substantial controversy remained and declaratory relief could terminate the uncertainty concerning Act 100 and future diversion of ERS investment earnings.
4. The Trustees' constitutional challenge was justiciable and was not barred by the political-question doctrine.
5. Sovereign immunity did not bar the Trustees' claims for prospective declaratory and injunctive relief because the requested relief was not tantamount to an award of damages and did not have a direct and unavoidable effect on the State treasury.
6. HRS § 661-5 did not bar the Trustees' constitutional claims because those claims were not cognizable under HRS chapter 661.
7. Article XVI, section 2 of the Hawai'i Constitution protects not only ERS members' accrued retirement benefits but also, as a necessary implication, the sources of funds used to provide those benefits. Act 100 violated that provision because it retroactively diverted ERS employer contributions and impaired the funding sources for accrued benefits.

Questions Presented

1. Whether the individual plaintiffs and SHOPO had standing to challenge Act 100.
2. Whether the ERS Trustees had standing in their fiduciary capacities to challenge legislation allegedly impairing the ERS.
3. Whether the Trustees' declaratory-relief claims were moot after Act 100 had been implemented.
4. Whether the action presented a nonjusticiable political question.
5. Whether sovereign immunity barred the Trustees' claims for declaratory and injunctive relief.
6. Whether HRS § 661-5's two-year statute of limitations applied to the Trustees' constitutional claims.
7. Whether Act 100 violated article XVI, section 2 of the Hawai'i Constitution by impairing accrued ERS benefits and the sources funding those benefits.

Disposition

vacated