ELR Citation: ELR 20113
No(s). 90-15661 (9th Cir. Sep 23, 1991)

The court holds that a privately held lagoon in Hawaii is not subject to the federal navigational servitude, and the federal government's attempt to require public access to the lagoon may only be accomplished by paying compensation under the Fifth Amendment. The Puko'o fishpond was created by native Hawaiians around 1829, by constructing a stone wall across an inlet to the Pacific Ocean. In 1960, a development company constructed the present lagoon, which involved the destruction of the fishpond wall and replacement with dredged material to create an approach channel, a boat anchorage basin, and public beaches on submerged public lands. In 1980, the developer sold the property to a trust that sought to promote native Hawaiian culture and to keep the property as clean and tranquil as possible by limiting access to the area to a limited number of organizations that share the trust's goals. When a local charter boat operator complained to the U.S. Army Corps of Engineers that he was denied access to the lagoon, the Corps expressed its view that the denial of public access violated a condition in the trust's dredging permit and the public's rights under the federal navigational servitude. A trust representative subsequently sought declaratory judgment to secure a right to deny public access to the lagoon. After finding the lagoon navigable, the district court held that it was not subject to the navigational servitude and that the Corps could not require public access without paying compensation as a taking under the Fifth Amendment.

The court first notes that the navigational servitude, unlike the power to regulate navigable waters under the Commerce Clause, is not coextensive with Congress' regulatory authority. Theoretically, there are no waters in the United States that are immune from the power to regulate navigation, based on how the courts have expanded the Commerce Clause to cover both waterways once navigable but no longer so, and waterways never navigable but which may become so with reasonable improvements. The navigational servitude does not extend beyond the highwater mark.

The court next finds that the district court, after weighing the evidence submitted by both parties on the disputed issue of the navigability of the pond, properly found the trust's evidence to be more persuasive than the government's. Although the district court's language indicates that its finding of inconsistencies in the testimony of the Corps' witnesses was in part connected with the court's consideration of the witnesses' credibility, the district court's findings are owed special deference and its treatment of the Corps' fact witnesses is not clearly erroneous. The district court did not base its findings regarding navigability on the fact that the Corps' witnesses were "admitted trespassers" when they were alleged to have navigated the pond, but merely noted the fact. Moreover, the district court could have concluded that a witness who will knowingly break the law is less trustworthy on the witness stand, or may be biased towards the Corps' position in opening the lagoon to public access. In all, the record supports the district court's conclusion that the fishpond wall in its ordinary state constituted a barrier to navigation, and it did not err in finding that Puko'o inlet was not navigable in fact.

The court next holds that the district court properly concluded that the navigational servitude, dormant or otherwise, has not attached to Puko'o Lagoon, since the trust's expectation of private ownership of the lagoon was with the backing of Hawaiian law. First, the court rejects the Corps' argument that the U.S. Supreme Court decision in Economy Light & Power Co. v. United States, 256 U.S. 113 (1921), requires the imposition of the navigational servitude as a matter of law in all instances where the area was once but is not longer navigable. Rather, the court relies on the U.S. Supreme Court decision in United States v. Kaiser Aetna, 444 U.S. 164, 10 ELR 20042 (1979), which rejected the notion that navigability for purposes of the Takings Clause is coterminous with navigability for purposes of regulatory power or admiralty jurisdiction. The Supreme Court in Kaiser Aetna placed significant weight on the treatment of the pond as private property and the reasonable investment-backed expectations of the pond's owners, which is grounded on considerations of English common law and notice to the parties of the government's dominant servitude. In this case, the trust purchased the property in reliance on the private status, under Hawaiian law, of the lagoon. Thus, although the government may regulate the lagoon, the Corps' attempt to require public access goes too far, and such a requirement may be imposed only by paying compensation for the taking.

[The district court's decision is published at 20 ELR 20515.]

Counsel for Defendants-Appellants
Apphia T. Schley
Environment and Natural Resources Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000

Counsel for Plaintiff-Appellee
Diane D. Hastert
Damon, Key, Bocken, Leong, Kupchak
1001 Bishop St., Pauahi Tower, Ste. 1600, Honolulu HI 96813
(808) 531-8031

Before Chambers & Rymer, JJ.