A buyer purchases a fee simple property in Hawaii and obtains title insurance. After closing, the buyer discovers that native Hawaiian families have been exercising traditional gathering rights on a portion of the property for generations, accessing the land to collect plants used in cultural ceremonies. The title insurance company denies the claim, stating that this encumbrance is not covered. Which of the following best explains the legal basis for the title insurer's denial?
Correct Answer
B) Native Hawaiian traditional and customary rights recognized under the Hawaii Constitution and HRS Section 1-1 are not extinguished by fee simple title transfer and may be excluded from title insurance coverage as pre-existing rights
Under the Hawaii Constitution (Article XII, Section 7) and HRS Section 1-1, native Hawaiian traditional and customary rights — including access and gathering rights — are legally recognized and may encumber private property. These rights are not extinguished by a fee simple deed. Title insurance policies may exclude these rights from coverage as pre-existing encumbrances or matters not shown by public records. This is a unique feature of Hawaii real estate law that does not exist in other states. Licensees must advise buyers that fee simple ownership does not eliminate these rights and that title insurance may not fully protect against them.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Community property is a system where property acquired during a marriage is owned equally by both spouses.
A freehold estate represents ownership of real property with an indefinite duration.
Joint tenancy is a form of co-ownership in which two or more persons hold equal, undivided interests in property with the right of survivorship. When one joint tenant dies, their interest automatically passes to the surviving joint tenants.
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