Ke Nani Kai Couple Awarded $3.8M in Suit

A west Molokai couple was recently awarded $3.87 million in damages when a Maui jury supported claims of harassment, threats and intimidation in a lawsuit against the Ke Nani Kai (KNK) homeowners association. In 2008, KNK residents Jim and Nancy Bevill, originally from California, sued the association, its board of directors, and several individuals, resulting in what has been called the largest monetary judgment of its kind in the country.

The 120-unit low-rise Ke Nani Kai resort on Molokai’s west end is intended to offer homeowners and vacationers a relaxing atmosphere with ample amenities. But for more than six years, “the Bevills found themselves targets… by an unlicensed contractor with a criminal record who was hired to do various tasks around the complex” as well as the resident manager, according to Terry Revere, who represented the Bevills. The Honolulu attorney called the situation the “equivalent of a John Ford Western where an isolated town is run by a villain and his collection of thugs.”

The jury supported the Bevills’ 11 claims, and found the defendants guilty of engaging in a variety of illegal activities including racketeering, civil conspiracy, gross negligence, malicious prosecution, breach of contract and both negligent and intentional infliction of emotional distress.

Revere said other homeowners experienced similar treatment, but “would not speak out for fear of retaliation,” according to a court filing.

The Bevills racked up over $800,000 in attorney fees alone, according to Revere, and the battle that ensued tore the KNK community apart.

“It pitted homeowners against homeowners,” said KNK resident Bob Aldrich. “It’s a black eye for Ke Nani Kai.”

Broad Implications
Despite current tensions in the aftermath of the lawsuit, Aldrich and some other residents feel it was a necessary step to ensure change not only at KNK, but in homeowners associations around the state and even country.

“I think this will go a long way in waking up homeowners association… nationwide,” said Aldrich. “Owners don’t have a lot of recourse short of spending hundreds of thousands of dollars for dealing with boards that are out of control.”

“The jury sent a very strong message,” said Revere. “If you abuse your owners, and engage in anything close to the outrageous conduct that happened here, juries aren’t going to stand for it.”

The jury awarded over $3 million in punitive damages, which are used to punish intentional or malicious misconduct. $1.3 million of that is to be paid by the board of directors and $700,000 by the condo association. Three individual directors are also being held liable with damages between $190,000 and $300,000, as well as the former resident manager and the unlicensed contractor.

Homeowners and lawyers said it remains to be seen whether insurance will cover costs accrued by the homeowners association.

A History of Intimidation
The complaint filed by the Bevills focuses on the association’s resident manager, Darrel Borling – described as having an explosive temper – and handyman Frank Maurizio, a convicted drug dealer with connections to gang violence, according to the filing. Borling using yelling and threats to intimidate residents while Maurizio violated contract rules while physically and verbally threatening homeowners and vandalizing their vehicles, Revere stated.

When this became too much for the Bevills, they gathered a group of similarly-treated fellow residents and sent a letter to KNK homeowners, alerting them to the crimes. The board filed suit against them in 2007 on grounds of defamation, which was dismissed in court.

The Bevills filed suit in 2008, and the recent decision was made during an eight-week trial. Evidence included condominium records, emails and audio and video recordings to back up the claims. The Bevills deferred personal comment to their attorney when contacted by the Dispatch.

For Jody Canady, a KNK resident of 30 years who was called to testify during the trial, the intimidation began long before the lawsuit was filed.

“It started 20 some odds years ago when Maurizio threatened to kill my husband,” she said. “It scared us so badly we hired a guard service for one month to watch our place at night.”

Canady said the handyman yelled another death threat at her husband, Daryl, in 2003.

Canady testified that in 2010, Maurizio tried to run her off the road, and a phone conversation was also caught on tape of Borling yelling at her.

Daryl Canady, who served as board president long before allegations began, said Borling and Maurizio would “rage around the property scaring everybody.”

“When this group [board] came in, they were thought of as Hitler – running it like it was a regime by the devil,” he said.

Jody Canady said she had been hopeful that the lawsuit’s verdict would settle things at KNK. However, that hope was dashed just two weeks ago, when she said a current board member “screamed at our front door that we are the most despicable people they know.”

She said she and her husband filed a police report on the incident, and that they would consider moving from KNK if the economy was better.

The board is not the only group unhappy with the jury’s decision, Jody Canady said, adding residents have been “divided 50/50.”

“I’m afraid I’ve been already ostracized for testifying,” she said. “[Fellow residents] look at me like I’m a monster.”

Looking to the Future
But despite the treatment she may be getting, Jody Canady still applauds the Bevills for taking a stand.

“The Bevills are two people that did something that none of us could afford to do – they took the bull by the horns… I commend them because it took a lot of guts,” she said. “I’m hopeful people will realize this had to be done… we all need to get together and work this out as a team.”

John Sears, a KNK resident and appointed spokesperson for the current board, echoed Canady’s hope for unification.

“We hope that Ke Nani Kai comes to together,” he said. “The board aggressively hopes and will aggressively work to have a community of homeowners.”

Sears said the board is “disappointed in the verdict,” but added that many of the current board members were only recently elected at the annual homeowner meeting, and none of them were on the board at the time the complaint was filed or were named in the lawsuit. He said it’s too soon to elaborate on future action, but “attorneys have been hired.”

Attorney John Zalewski, who represented the association, did not return calls or emails for comment.


3 Responses to “Ke Nani Kai Couple Awarded $3.8M in Suit”

  1. Kalikiano says:

    Without knowing anything about this situation other than what has been reported by the Dispatch staff, all I find myself able to comment is that this sort of unnecessary acrimony certainly tarnishes the island’s famous ‘aloha’. To think such conflicts afflict our lovely island every bit as bitterly as o’dare (on the mainland) is simply a further sad indictment of the ‘system’ that has been imposed upon the islands since the monarchy was overthrown. That’s not to say that the monarchy didn’t have its own rather substantial problems, but again, most of them were the result of western culture being the gross contaminant that catalysed the worst changes to traditional culture here.

    There is a marvelous book published originally in 1969 titled ‘The Hawaiians’ . It is a superb commentary on the many changes that have taken place on the islands since Cook more or less opened the door of Pandora’s Box, and it is filled with several hundred masterful color images of Hawaii’s breathtaking diversity. In that book, there is a small section that describes an actual conversation overheard by the author between two kama’ainas sitting near him at the Hotel Molokai bar.

    One turns to the other over a sip of Primo and says, “Yeah, I know. Dis ‘Friendly Isle’ stuff should be trashed and sumpin lak ‘Molokai, da Angry Isle’ should get da honahs. You could staht by greetin’ dem visitors arrivin’ at Ho’ohlehua wid a sacrifice wheah da pig is slaughtered right dare, in fronta dem…you know, blood, guts, squeals, da whole kine! Have big guys in malos walkin’ round carryin’ spears, eyin’ evryone and let it be known dat once in a while, some lucky malihini get selected at random for human sacrifice to placate Ku. Mebbe dat makum tink a bit befoh decidin’ dey wanna stay here, eh!”

    While not an exact quote, it certainly communicates the essence of what many people doubtless still feel when bourgeoise angst like this surfaces on ‘The Friendly Island’. Let’s all fervently hope for MORE aloha spirit and LESS of this unhappy stuffs, eh! Auwe!

  2. Halls says:

    …sounds like trouble in paradise…we owned a unit at Ke Nani Kai for a couple years, and are familiar with nearly all those involved…It is probably enough to say that very occasionally, in the course of human events, justice is served.

  3. jimmiehuff says:

    It appears this situation has escalated way beyond reason, and the only real winners are the lawyers. Did anyone check into the previous history of all the complaintants?

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