[§201H-51]  Corporation's right to
repurchase or rent real property; authority to seek recovery.  (a) 
Notwithstanding any provisions to the contrary, during the period in which the
restrictions in section 201H-47 are in effect, the following provisions shall
apply when dwelling units developed, constructed, financed, purchased, or sold
pursuant to Act 105, Session Laws of Hawaii 1970, as amended, are found to have
a substantial construction defect, or when vacant lands developed, financed,
purchased, or sold pursuant to Act 105, Session Laws of Hawaii 1970, as
amended, are found to have a substantial soil defect:



(1)  The corporation shall have the right, but not the
obligation, to repurchase a dwelling unit or land that has a defect, regardless
of whether or not the owner wishes to sell; provided that those repurchases
shall be in accordance with the following provisions:



(A)  The corporation may repurchase a dwelling
unit or land if:



(i)  The dwelling unit or land is deemed unsafe
by the county building department;



(ii)  The defects are irreparable; or



(iii)  In the opinion of the corporation, the
defect is of such magnitude that it will take longer than one year to repair;



(B)  The corporation's purchase price shall be
based on the formula set forth in section 201H‑47(a)(1);



(C)  After repairs to the unit or land are
completed, the former owner shall have the first right of refusal to repurchase
the real property;



(D)  The corporation shall give preference in
all other projects of the corporation to all owners whose real property is
repurchased by the corporation under this subsection, and the corporation may
waive certain eligibility requirements for these owners; and



(E)  If the corporation exercises its right to
repurchase defective real property against an owner's wishes pursuant to this
paragraph, the corporation shall provide relocation assistance to that owner as
provided in chapter 111;



(2)  If the corporation does not opt to repurchase
defective real property, the corporation shall also have the right, but not the
obligation, to enter into a contract to repair a dwelling unit which has a
construction defect or land which has a soil defect.  During the period that
the real property is being repaired, the corporation shall rent that real property
from the owner for an amount not to exceed the owner's present mortgage
payments; and



(3)  If the corporation does not execute either a
contract to repurchase the real property or an agreement to repair and rent the
real property within ninety days after written notice is given to the
corporation of a construction defect, the owner may pursue any other available
legal remedies.



For the purposes of this section:



"Substantial construction defect"
includes but is not limited to:



(1)  Structural defects such as shifting foundations
and bearing walls;



(2)  Structural deficiencies due to the use of
defective or undersized materials; and



(3)  Defects affecting the health and safety of
occupants.



"Substantial soil defect" means
shifting, sliding, or sinking ground of such degree as to affect the dwelling
unit on the land or the health and safety of the occupants of the land.



(b)  If moneys are expended by the corporation
pursuant to subsection (a)(1) and (2), the corporation shall have the authority
to take necessary legal action against the developer, co‑developer,
general contractor, and their subcontractors, consultants, and other parties
notwithstanding chapter 657.



(c)  If real property developed, constructed,
financed, purchased, or sold pursuant to Act 105, Session Laws of Hawaii 1970,
as amended, is found to have a substantial construction or soil defect, the
corporation shall have the right, but not the obligation, to file or cause to
be filed a legal action on behalf of or by the owner or lessee of the real
property for the recovery of damages or for injunctive relief against the
developer, co-developer, general contractor, and their subcontractors,
consultants, and other parties notwithstanding chapter 657.  Additionally,
notwithstanding any provision of rule 23 of the Hawaii rules of civil
procedure, the corporation may file or cause to be filed a legal action brought
under this subsection as a class action on behalf of or by at least two owners
or lessees of real property that have similar substantial construction or soil
defects.



(d)  Nothing in this chapter shall be construed
to diminish the rights or remedies of the corporation otherwise provided under
common law, by law, or by contract.



(e)  The corporation shall adopt rules pursuant
to chapter 91 necessary for the purposes of this section.



(f)  This section shall not apply to a
particular real property and shall not apply after subsequent transfers of
title of that real property if the corporation releases the restrictions when
the real property is financed under a federally subsidized mortgage program.



(g)  If any subsection, sentence, clause, or
phrase of this section, or its application to any person or transaction or
other circumstances, is for any reason held to be unconstitutional or invalid,
the remaining subsections, sentences, clauses, and phrases of this section, or
the application of this section to other persons or transactions or
circumstances, shall not be affected.  The legislature hereby declares that it
would have passed this section and each subsection, clause, or phrase thereof,
irrespective of the fact that any one or more subsections, sentences, clauses,
or phrases of this section, or its application to any person or transaction or
other circumstance, may be declared unconstitutional or invalid. [L 2006, c
180, pt of §3]