Encumbrances And Restrictions Flashcards
Course overview Encumbrances specific to Hawaii including Udgements Mechanic’s liens Property liens Private and public land use restrictions State environmental laws Uniform Land Sales Practices Act
Should be able to
Discuss how various general and specific liens affecting Hawaii real property owners
Identify the impact of public restrictions on development of land in Hawaii
Describe the key provisions of the Uniform Land Practices Act
GENERAL LIENS
Upon a person’s death, general liens for his debts are created when creditors file claims against his estate.
Federal and state governments may impose ESTATE or INHERITANCE TAXES on estate.
There is no estate tax in Hawaii.
An INCOME TAX lien is a general lien when a government files a tax warrant with the
Registrar of Conveyances. Once this is recorded, it applies to ALL OF Ta pers property and has priority as of the date the lien was recorded.
A court decree or monetary judgement becomes a JUDGEMENT LIEN when it is recorded in the Assistant Registrar of the Land Court or at the Bureau of Conveyances.
Such a lien continues for the length of time of the underlying judgement. If a debtor satisfies the judgement, he has to obtain from the creditor a satisfaction of judgement to indicate the judgement has been paid. Any time during the lien period and before judgement is satisfied, the judgement creditor may seek to have judgement enforced by execution.
MECHANICS LIEN
Effective date of lien is the day of visible commencement and up to 45 days after work completion to file.
It has priority over all other liens EXCEPT Government Liens and
Mortgage liens that used state funds
DATE OF COMPLETION is.
The date the General Contractor or owner publishes the notice of completion and files an affidavit with Circuit Court, stating notice was published.
One year after actual abandonment or completion of work, if no notice published
Once court finds probable cause, it will attach the lien to the property. The person who filed the lien then has 3 mos. in which to file an action to enforce the lien before it expires.
PROPERTY TAXES , , involuntary liens that could result in the property being sold for non payment of taxes. They have priority over all other liens. In event of foreclosure, these taxes paid first.
Property Tax year is July1 thru June.
Paid to the County Finance Director in 2 equal installments
1st: Due on or before Aug. 20th of assessment yr. and covers payment from July1 thru Dec. 31
2nd: Due on or before Feb. 20 of assessment yr and covers Jan1 thru June 30
HOMEOWNERS TAX EXEMPTION (HRS248)
Certain exemptions from property tax
Owner-occupied Homeowner Exemption
Homeowner who resides in home for longer than nine mos, including a person who has: a long term lease and pays property tax
Is buying under agreement of sale
Owns a coop or condo
Will be assessed value exemption and will be taxed balance
Couple separated may prorate the exemption between them
Exemptions
In order for the exemption to take effect the following year, homeowner must apply for it in year of sale. However deadline for filing exemption application is diff. In diff. Areas
By dec. 31 in Maui and Hawaii or by sept. 30 following sale in Oahu. Once the exemption application is approved, the amount is auto. Deducted each year until property is sold. Single family homes varies by county and by age. Honolulu it is $80,000. For under 65 and $120,000. For over 65
Additional exemptions are applied for certain owners :
Blind or deaf people
Disabled vets who pay no real property taxes
Government agencies
Persons with Hansen’s disease (leprosy)
Religious org. And educational institutions
Persons who are totally disabled, paralytic, amputees or incurable insane
Property Tax Appeals
Notice of Assessment sent every year. Contains
Assessed value
General land class
Amount of exemption
If owner disagrees, he may, prior to the start of the new tax year may:
Discuss the matter with the tax assessors office
Appeal to the
Tax Board of Review
Tax Appeal Court or
If the amount in dispute is less than $1,000.00 , small claims section of the State Tax Appeal Court
Deadline for Appeal
Jan. 15th in Honolulu Cty
April 9th in all other cities
Grounds for Appeal
1. Assessment of property exceeds its market value by more than10% in Honolulu and more than 20% in all other counties
- Lack of uniformity or inequality brought about by:
Illegality or
An error in the application of assessment methods to the property - Denial of an exemption to which a qualified taxpayer is entitled.
- Illegality on any ground arising under the Constitution or federal law or the laws of Hawaii or the ordinances of a city
An APPEALING-taxpayer must:
Pay all taxes by due dates or he will be charged a penalty
Pay the stipulated costs for an appeal
Prove that assessors assessment is incorrect, usually by submitting data from sales of comparable properties to support his position
If tax paper prevails, any overpayment is refunded
PRIVATE RESTRICTIONS. may be conditions or covenants
A CONDITION is a restriction that provides for ownership to revert to the former owner if condition is violated.
These conditions or requirements create a defeasible(able to be terminated) fee estate.
PRIVATE RESTRICTIONS. may be conditions or covenants
COVENANT is a promise to do or not to do something.
Subdivisions have covenants that I.e. establish setbacks lines and limit the types of structures that may be built.
Violation of a covenant may result in
Suit for damages by any person adversely affected by the violation. OR
Injunction to force correction of the violation
Where there are private and public restrictions , the more stringent will prevail.
LAND USE LAW. adopted 1981
Law establishes guidelines for land use management and classifies all of the land in the state into 4 districts:
- Urban
- Rural
- Agricultural
- Conservation
95% is slit between conservation and agricultural districts.
.2% is rural property
4.7%. is urban property
State land Commission establishes boundaries for each district for entire state. It also considers special use permits
Boundary changes
Other land issues
A ZONING ORDINANCE or land use ordinance is a restriction on the use of private land.
Under the OHANA LAW,
The building of an additional residential unit on a property zoned as a residential lot for one swelling is permitted, provided the dwelling meets all the county requirements.
Under the FAMILY CHILD CARE HOMES (FCCH) exception , with registration with the state , a private home ( whether an apt., townhouse, single family dwelling) may be used to provide care of 3-6 children unrelated to the occupant.
Planned Development Housing (PDH) formerly known as PUDS may be encouraged by certain zoning decisions.
High wash of waves , evidenced by growth of vegetation or deposited debris , normally marks the boundary of public vs. private property.
The Hawaiian Coastal Zine Management Program ( HCMO) states all beaches are public property. Except access to beaches may be controlled and blocked by private owners.
The shoreline setback statute established restrictive zone of 40’ from upper reaches of the wash of waves although the zone is 20 feet for certain parcels of land.
The Shoreline Protection Act called for establishment of Special Management Areas (SMA) extended a minimum of 100 yards inland from shoreline vegetation or debris line.
