$67,280 in fees to collect $11,498 is not disproportionate enough to reverse
$67,280 in fees to collect $11,498 is not disproportionate enough to reverse
2026-09-10 · Hawaii · Courts
A Hawaii planned community association recovered $67,280.34 in fees and costs on a collection amount of $11,498.21, and the Intermediate Court of Appeals declined to call that an abuse of discretion.1
Ewa Villages Owners Association v. Tautua, No. CAAP-24-0000060, memorandum opinion filed June 18, 2026. Unpublished; no certiorari disposition on record as of this writing. An earlier appeal from the foreclosure decree itself was affirmed in 2025.
How it got there
Ewa Villages is a master-planned residential community on Oahu. The association foreclosed under HRS § 421J-10.5 and HRS § 667-1.5 in November 2020 to recover $18,949.96 in dues, late fees, repair reimbursement and assessments, following the owners’ noncompliance with a 2015 judgment.
The owners refused to allow open houses and refused an interior inspection. The property sold at auction to the association for $15,000, subject to the mortgage and a City special assessment lien.
The two holdings
On the price. Applying Hoge v. Kane: “[c]onsidering the particular circumstances of this case — the Tautuas’ refusal to comply with the 2015 Judgment, refusal to hold an open house, refusal to allow an inspection of the Property — and the forced nature of a foreclosure sale, we cannot say that the sale price subject to the mortgage and the SAE lien shocks the conscience.”
On the fees. The panel leaned on a single word in the statute. HRS § 421J-10(a) entitles the association to “[a]ll costs and expenses, including reasonable attorneys’ fees.” “The Tautuas do not claim any of the fees or costs were unreasonable beyond saying they exceed the ‘collection amount.’ And we decline to find abuse based solely on the attorneys’ fees and costs exceeding the ‘collection amount,’ as HRS § 421J-10 allows for ‘all’ reasonable attorneys’ fees.”
What this means for an owner contesting fees
Generalised proportionality arguments lose. “These fees are too high relative to the debt” is, on this authority, not an argument at all — it is an observation about a ratio the statute does not limit.
What is left is specific: line-item challenges to particular time entries, rate challenges, duplication, block billing, work not reasonably necessary to the collection. That is more work and it requires the bills, but it is the only path the opinion leaves open.
What it means for a planned community board — including the part that cuts the other way
The same subsection runs both directions, and the panel quoted it: “provided that if the association is not the prevailing party, all costs and expenses, including reasonable attorneys’ fees, incurred by any such person or persons as a result of the action of the association, shall be promptly paid on demand to the person by the association.”
Note the trigger. In chapter 421J it is “not the prevailing party.” In the condominium chapter, HRS § 514B-157(a), it is “if the claims upon which the association takes any action are not substantiated.” Those are different tests, and a planned community association carries the harder one: losing is enough.
Section 421J-10(a) also assigns the court the job of deciding reasonableness, so a board that lets its counsel run an unexamined bill is exposed at exactly the moment it loses.
The condominium comparison worth knowing
Under § 514B-157(b), an owner whose claim is substantiated gets fees from the association. And if the owner’s claim is not substantiated, the association gets its fees — “unless before filing the action in court the owner has first submitted the claim to mediation, or to arbitration under subpart D, and made a good faith effort to resolve the dispute.”
That clause is the single most consequential sentence in Hawaii association fee law: an owner who mediates first is shielded from the association’s fees even on a losing claim. Chapter 421J has no equivalent shield — its exception covers claims first submitted to § 421J-13 mediation or filed in small claims court.
The practical sequence for both sides
- Owners: mediate before filing, and keep the record of having done so in good faith. Then, if fees are awarded anyway, challenge the bill line by line rather than the ratio.
- Boards: a fee award is not a free option. Review counsel’s billing as it accrues, because the reciprocal clause turns an unexamined bill into an association liability the moment a claim fails.
- Both: note that an entity that is not an “association” within § 421J-2 gets no fee shift at all — a definitional question Hawaii appellate courts have decided against fee claimants more than once.
What to watch
Certiorari, and whether any 2027 measure revives the fee cap. SB 2037 (2026) would have capped fees awarded under § 514B-157 at 25% of the underlying claim; the Senate committee deleted the cap before the bill died in Judiciary without a hearing. The idea is not gone, only unfiled.
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