Developers Built a $500,000 House on the Wrong Lot in Hawaii; Now the Lot Owner Is Being Sued – The Inertia

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Developers build house on Big Island lot

An example of one of the vacant lots for sale in Hawaiian Paradise Park. Photo: Hawaii Life Real Estate

The Inertia

When Annaleine “Anne” Reynolds bought an empty one-acre lot in a Big Island subdivision called Hawaiian Paradise Park, she had big plans for it. But in a very strange turn of events, a developer built a house on it without her knowledge. Now, she’s being sued.

“There’s a sacredness to it and the one that I chose to buy had all the right qualities,” Reynolds told Hawaii News Now.

Hawaiian Paradise Park, known as HPP, is a sparsely populated but spread-out community in the Puna district. It is situated south of Hilo on the Big Island’s easternmost side. It’s a growing area full of lots for sale, and developers are building everything from track homes to to mansions. It’s made up mostly of lava rock, speckled with trees and vegetation, far enough away from Pahoa Town and Keaau to avoid the tourists, but close enough to enjoy the benefits of the things a more urbanized area has to offer. Hilo is about 20 miles away, and the area is a hot spot for Native Hawaiian petroglyphs and heiau. For those looking for absolute Hawaiian serenity, HPP is a tempting spot.

According to the Associated Press, Reynolds bought the empty chunk of land in 2018. It was sold at a county tax auction, and she got it for a steal: just $22,500. The house that now stands on it? It’s worth around $500,000.

The lot owner doesn’t want the house and has endured problems like higher taxes and squatters,” Hawaii News Now reported. “Now, to add insult to injury, she’s being sued over someone else’s mistake.”

She bought the lot a year before the pandemic locked the world down, and was biding her time until she could use it. But last year, a real estate broker called her up and let her know that he had sold the house on her property. She was understandably confused.

developers on Hawaiian Paradise Park

Hawaiian Paradise Park, where you might find a house built on your lot by mistake. Photo: Hawaii Life Real Estate

“And then he informed me, ‘oh well, I just sold the house, and it happens to be on your property,’” Reynolds told reporters. “So we need to resolve this. And I’m like, ‘what? Are you kidding me?’”

The company that mistakenly built the house on the wrong lot was PJ’s Construction, a local building outfit that was hired by developer Keaau Development Partnership. The plan was to build 12 homes on parcels that Keaau Development purchased. The lots were marked out by telephone poles, but someone made a grave mistake.

Hawaii News Now reported that “an attorney for PJ’s Construction said the developers didn’t want to hire surveyors.”

Now, in a bizarre twist, Reynolds is being taken to court over the mix-up. Already, the empty house is attracting would-be squatters. “There’s a lot of fingers being pointed between the developer and the contractor and some subs,” James DiPasquale, a lawyer out of Honolulu explained. “Before they put the fence on this property there was people coming already to this property. I know kind of looking inside.”

Since the Reynolds and developer are in a bit of a strange situation, the house can’t be sold. She was able to have a look at the house on her lot in person, though, and she was not happy with what she found. It appeared that squatters had laid claim to the empty house and were making themselves comfortable.

“Both had poop,” she said of the bathrooms. “The hallway one had poop on the floor. It was so disgusting.”

When the mistake was discovered, the developers tried to offer a solution that wasn’t suitable for Reynolds. Hawaii News Now wrote that they offered to trade a lot that sits beside hers and sell her the house they’d built at a discount. To make matters worse, her property taxes have skyrocketed now that there is a structure sitting on her land. She gave the developers a hard no for an answer.

“It would set a dangerous precedent, if you could go on to someone else’s land, build anything you want, and then sue that individual for the value of it,” DiPasquale said.

When Reynolds refused Keaau Development Partnership’s offer, they turned around and sued PJ’s Construction, the architect, the prior property owner’s family, and the county, which approved the building permits.

Reynolds, as one would expect, has filed a counterclaim against Keaau Development Partnership, claiming that the construction was never authorized and that she had no idea it was happening.

The developer’s representatives claim that they’ve done their best to fix their mistake, but that the other parties involved aren’t open to their solutions. “That’s why the developer says they have pulled everyone into the lawsuit,” Hawaii News Now explained, “in hopes a judge can help unravel this half-million-dollar mistake.”

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