§171-79  Purchase of fee title by lessee. At any time after the requirement of construction of a residence upon thepremises has been fulfilled and after ten years from the date of the issuanceof the lessee's residential lease, any residential lessee who is financiallyable to purchase the fee title to the premises demised to the lessee by thelessee's residential lease may, if not in default under the terms of thelessee's lease, purchase the fee title at its fair market value determined asof the date of the exercise of the lessee's option to purchase.  The fairmarket value shall be determined by appraisers and shall exclude the value ofimprovements erected by the lessee and shall be determined as if the premiseswere not subject to the residential lease or to any mortgage made by thelessee.  The patent or deed issued upon purchase shall state that within theten-year period following the date of issuance of the patent or deed, the landor any interest therein shall not, without the written consent of the board ofland and natural resources, be sold, leased, or otherwise transferred to anyperson disqualified under sections 171-74 and 171-75, except that the lesseemay mortgage the premises and improvements, without the board's consent, torecognized lending institutions, which mortgage may be freely assigned by themortgagee and the fee title sold to any person or corporation or agency ofgovernment at or after foreclosure. [L 1962, c 32, pt of §2; Supp, §103A-75;HRS §171-79; gen ch 1985]

 

Case Notes

 

  Fee simple interest may be purchased under §171-99(a) bypayment of "fair market price", which, under this section and§171-99(a), requires appraisers to ignore both the value of improvementserected on the premises and the lease encumbrances.  85 H. 217, 941 P.2d 300.