(a) Effect of breach of restriction. Except as otherwise provided in this chapter any sale or attempted sale, contract, or conveyance contrary to § 206-10 shall be void. Any use contrary to § 206-10 may be enjoined by the State, the board of land and natural resources or an owner or owners of the residence lots within the same development project. Except as otherwise provided in this chapter, if a sale, contract, or conveyance contrary to § 206-10 is attempted, or a use contrary to § 206-10 is not voluntarily remedied or is not or cannot be remedied by injunction, or a building is not erected in accordance with section 206-10(d), the lot affected shall be forfeited and the title revested in the State upon suit by the State establishing any of the foregoing. Upon the forfeiture, the board shall sell the lot at public auction, or at private sale, for the current market value, to a purchaser eligible to purchase from the board in the first instance, and the original purchaser shall be reimbursed insofar as possible, after deduction of costs of resale. Provided that in the event title to any lot passes to any obligee, or to any agency of the United States government, pursuant to the terms of any insurance or guarantee of mortgage loss by such agency, no forfeiture or revesting in the board shall be enforced.
Contract: A legal written agreement that becomes binding when signed.
Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
Development project: means a specific unit for development within a designated area for which a program of acquisition and development is established. See Hawaii Revised Statutes 206-1
Injunction: An order of the court prohibiting (or compelling) the performance of a specific act to prevent irreparable damage or injury.
Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
Obligee: means any bondholder, agents or trustees for any bondholders, or lessor demising to the board property used in conjunction with a development project, or any assignee of the lessor's interest or any part thereof, and the federal government when it is a party to any contract with the board. See Hawaii Revised Statutes 206-1
Residence lot: means a lot not exceeding one-half acre in size, obtained by subdivision of lands acquired pursuant to this chapter and used for one or two family residential use only, except as may otherwise be provided herein. See Hawaii Revised Statutes 206-1
(b)Mortgage of residence lots. Nothing herein shall prevent the conveyance of a residence lot by way of mortgage to any person or corporation.(c) Nothing in this chapter shall be construed as limiting the power of the board to vest in an obligee the right, in the event of a default by the:
(1)Board or by the purchaser, to take possession of a development project or lot or cause the appointment of a receiver thereof, free from all the restrictions imposed by this chapter; or(2) Purchaser, to acquire title to a lot or the property mortgaged by the purchaser free from all the restrictions imposed by this chapter.
