Rice v. Cayetano

Citations: 146 F.3d 1075; 98 Daily Journal DAR 6753; 98 Cal. Daily Op. Serv. 4773; 1998 U.S. App. LEXIS 13200; 1998 WL 324980Docket: No. 97-16095

Court: Court of Appeals for the Ninth Circuit; June 22, 1998; Federal Appellate Court

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Hawaii conducts special elections for trustees of the Office of Hawaiian Affairs (OHA), which requires that candidates and voters be Hawaiian. This restriction is based on the premise that only Hawaiians have a vested interest in the public trust funds established for their benefit. Harold F. Rice, a Caucasian, challenges the district court's ruling that upheld these voter qualifications, asserting that the restriction violates the Fifteenth Amendment and the Equal Protection Clause. The court affirms the lower court's decision, stating that limiting voting rights to Hawaiians is justified, given their unique stake in the trust.

The background includes Hawaii's transition from an independent kingdom to U.S. territory, with significant land ceded and a commitment to use revenues from these lands for public benefit. The Hawaiian Homes Commission Act of 1920 defined "native Hawaiian" and was designed to support the rehabilitation of the Hawaiian population. Upon statehood in 1959, Hawaii adopted the HHCA definition in its constitution, ensuring the public lands were held in trust for the benefit of native Hawaiians. The OHA was established in 1978 to manage these trust assets, with a governance structure requiring trustees to be Hawaiian, enforcing the voter restriction based on the trust's beneficiaries. Rice has lived in Hawaii his entire life but does not meet the eligibility criteria to vote in these elections.

Rice, who is Caucasian and does not meet the statutory definition of Hawaiian or native Hawaiian, applied to vote in the 1996 election for trustees of the Office of Hawaiian Affairs (OHA). His application was denied because it required him to be Hawaiian, prompting Rice to challenge this exclusion under 42 U.S.C. 1983, arguing that it violates the Voting Rights Act, the Fourteenth and Fifteenth Amendments, and other constitutional provisions. The district court upheld the voting restriction as constitutional, stating it is not racially based but recognizes the unique status of native Hawaiians, linked to Hawaii's trust obligations. The court noted that OHA’s functions are not governmental and are specifically aimed at benefiting Hawaiians. Rice appealed, asserting that OHA's authority to provide services based on race is unconstitutional, claiming it violates the Fifteenth Amendment by conditioning voting rights on racial identity, and the Fourteenth Amendment due to improper racial classifications under strict scrutiny standards. He also raised a new argument on appeal regarding anti-nobility provisions, asserting that it creates unequal classes among citizens based on ancestry. In response, Hawaii argued that the voting limitation is a legal classification tied to trust beneficiaries, not a racial one, and asserted compliance with federal definitions and obligations concerning native Hawaiians. Hawaii maintained that its classification meets rational basis scrutiny standards, similar to the relationship between the federal government and Native American tribes.

Rice challenges Hawaii's assertion that the right to vote is merely a reflection of native Hawaiians' legal status, arguing that the classification of beneficiaries under the Office of Hawaiian Affairs (OHA) trusts is racially based. However, the constitutionality of this racial classification is not at issue in the case, leading to the acceptance of the trusts and their governance structure as lawful. It is recognized that land was appropriately set aside for native Hawaiians and that the OHA, governed by a board of Hawaiian trustees, has a duty to these beneficiaries. Therefore, it is reasonable for the state to allow Hawaiians to decide their trustees, framing the voting restriction as legal or political rather than primarily racial.

Rice contends that Hawaii has established a racially exclusive voting bloc, which he argues violates the self-executing nature of the Fifteenth Amendment, as it explicitly limits voting rights to Hawaiians. The Hawaii Constitution and relevant statutes explicitly classify voters based on race. However, the voting restriction relates specifically to electing trustees who manage trust properties for Hawaiians and does not apply to general elections where all qualified voters can participate. The district court likens these special elections to those upheld in Salyer Land Co. v. Tulare Water Dist. and Ball v. James, where voting eligibility was limited to landowners due to the special nature of the elections. These precedents suggest that such restrictions may be permissible when the elected body does not exercise general governmental powers and the voting impact is limited to a specific group disproportionately affected by the agency's actions. Rice argues against this rationale, citing OHA's financial authority and its relevance to all citizens of Hawaii, but the framework established by prior cases still supports the legality of the voting restrictions in this context.

Salyer cannot be entirely disregarded, as Rice's discontent with the Office of Hawaiian Affairs (OHA) is not within the scope of this case. Public lands and funds are dedicated to benefiting the Hawaiian peoples, who are the only parties with legal interest in the management of these resources. Their authority to choose who administers the trust aligns with Salyer's principles, despite the race-based qualifications involved. The historical context of voting restrictions for trustees is tied to longstanding concerns for the Hawaiian race, originating from the Hawaiian Homes Commission Act of 1920 and continuing through Hawaii's statehood, which acknowledged a trust obligation to native Hawaiians.

In 1993, Congress expressed regret for the overthrow of the Kingdom of Hawaii and the subsequent disenfranchisement of Native Hawaiians. The preferential treatment for Hawaiians established through trusts and the creation of OHA parallels the special treatment of Native Americans recognized in Morton v. Mancari. While Hawaiians differ from Native Americans in certain respects, both cases illustrate that preferential treatment based on governmental obligations can be political, not purely racial, even if racial criteria are involved.

The Fifteenth Amendment prohibits racially-based voting restrictions, but this case does not pertain to a general election for government officials. The voting qualification, although racially defined, does not preclude those with an interest in the election's outcome from participating. Limiting the vote for trustees to Hawaiians does not infringe upon non-Hawaiians' voting rights in a significant way, as the election is not for government functions but for trustees whose fiduciary responsibilities are exclusively to native Hawaiians and Hawaiians. Thus, electing trustees from interested parties ensures effective management and adherence to fiduciary duties.

Hawaii law does not systematically prevent non-Hawaiians from voting, thus Rice's voting rights are not denied under the Fifteenth Amendment. Rice contends that the racial voting restriction for OHA trustees violates the Fourteenth Amendment. While acknowledging that the law includes a racial classification, it is deemed primarily contextual rather than purely racial, akin to historical voting limitations based on land ownership. The court recognizes Hawaii's rationale for allowing only those with a vested interest in the trust to vote, which aligns with the state’s fiduciary responsibilities to native Hawaiians and aboriginal descendants. Although the voting restriction is subject to strict scrutiny due to its racial nature, it is justified by Hawaii’s obligation to manage trust assets for its indigenous population. The classification is thus upheld as it ensures that only those with a legal interest in trust management can participate in trustee elections. The court also declines to address Rice's new argument regarding the Anti-Nobility Clauses, affirming the decision. The definitions of 'Hawaiian' and 'native Hawaiian' are provided, along with a note on the standing of Rice as a Caucasian resident claiming injury from the voting restriction.

Historical facts related to the dispute are acknowledged as complex and potentially misleading without further context. The appeal does not hinge on any single historical fact but aims to provide sufficient background. Section 5(f) of the Admission Act mandates that lands granted to Hawaii be held as a public trust for supporting public schools, improving conditions for native Hawaiians as defined by the Hawaiian Homes Commission Act, promoting farm and home ownership, making public improvements, and providing lands for public use. The Hawaii Constitution reinforces that these lands, excluding 'available lands' as defined by the HHCA, are to be held in public trust for native Hawaiians and the general public.

The Office of Hawaiian Affairs (OHA) is tasked with enhancing the conditions of native Hawaiians and is responsible for program coordination, policy assessment, and funding for related initiatives. While the five purposes of the 5(f) trust exist, they lack specific revenue allocations administered by OHA. Claims under the Voting Rights Act have been abandoned by Rice, who relies on scholarly work addressing the constitutionality of the underlying arrangement rather than the voting rights provision in question. The document refrains from commenting on the constitutionality of the trust structure or OHA's purposes, except for the specific voting limitation being challenged.

Haw.Rev.Stat. 10-16(c) allows beneficiaries to sue board members for misapplication of funds and breach of fiduciary duty. The Fifteenth Amendment prohibits voting discrimination based on race. OHA trustees possess authority over the management of funds and properties dedicated to native Hawaiians, including revenue from the 5(f) trust. Their responsibilities include policy formulation, provision of grants, and offering technical and financial assistance for native Hawaiian programs. The board is also tasked with developing a master plan, collaborating with other agencies, maintaining program inventories, and securing federal funds to support initiatives for native Hawaiians.

Section 13D-4 mandates that members of the board of trustees be elected during a special election held alongside the general election every even-numbered year. Rice argues that historical obligations were directed specifically toward 'native Hawaiians,' not merely those of Hawaiian ancestry, as the current OHA statute suggests. While the 1978 constitutional amendments expanded the definition of beneficiaries to include 'Hawaiians,' this distinction is not pertinent to the current appeal, as the classification itself is not contested. The document references previous legal discussions questioning the relevance of Mancari in light of Adarand, noting that current legal precedents must be followed until explicitly overturned, which has not occurred. Additionally, the Committee's report on Section 5, which established OHA, emphasized that trustees should be elected to ensure that those who own the assets have control over them, thereby improving governance and accountability, and enhancing the fiduciary relationship between trustees and native Hawaiians. The excerpt concludes with a citation of the Fourteenth Amendment, which prohibits states from infringing on the rights of citizens and mandates due process and equal protection under the law.