A judge denied Mauna Kea Resort Services’ request for an injunction Wednesday, ordering that organization to enter mediation with another community association.
The Uplands at Mauna Kea Association filed suit last month against Mauna Kea Resort Services, an umbrella organization for several other resort homeowners associations, alleging the company had fraudulently withheld millions in common area fees for roads and other services.
Uplands attorney Jerry Hiatt said Wednesday 3rd Circuit Court Judge Ronald Ibarra also denied a temporary restraining order against Uplands.
Mauna Kea Resort Services’ attorney Melvin Miyagi argued in his injunction request that declaring his client in default, allowing Uplands to initiate a lien on his client’s property and instituting foreclosure proceedings would irreparably damage his client.
Miyagi called Uplands’ lawsuit “unsubstantiated claims for previously unbilled assessments.”
A lien or cloud on Mauna Kea Resort Services’ titles would threaten a contemplated sale of several properties, Miyagi said, adding Uplands and his client were in the midst of an ongoing dispute over road maintenance and security expense.
Mauna Kea Resort Services “in good faith, has been attempting to reconcile the alleged miscalculations and determine the property amount, if any, that it underpaid for The Uplands Entry Road expenses,” Miyagi wrote in his argument supporting the restraining order and injunction. “Up until recently, negotiations had been ongoing” but the parties had not yet been able to reach a settlement.
Hiatt, in his filing opposing the injunction and restraining order, said Mauna Kea Resort Services’ would not be subjected to irreparable damage, and any “injury” to the company “is instead merely hypothetical and speculative. Mauna Kea’s Motion implies that the Uplands Association’s lawsuit … is somehow interfering with Mauna Kea’s sale of three Lots in the Uplands known as Lots A, D, and E. But (a Mauna Kea official) stated he didn’t know if any sale was in escrow, or even if a purchase agreement has been signed for any of those Lots.” During a deposition, Hiatt said, Miyagi “refused” to let this official answer the question about the sale, even though the official raised the issue first and Miyagi made the sale a “key part” of the basis for his motion.
Preliminary estimates put the figure in unpaid fees at about $5 million. According to the lawsuit, the various community associations on the property have a formula by which their respective shares of common area costs are calculated. The Uplands group is an umbrella association of four different homeowners associations and several undeveloped lots, attorney Bruce Voss said. They represent a total of 166 lots.
