KO OLINA DEVELOPMENT, LLC, a Delaware limited liability company v. CENTEX HOMES, A Nevada general partnership

This disposition is not appropriate for publication and is not precedent*
except as provided by 9th Cir. R. 36-3.
NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
KO OLINA DEVELOPMENT, LLC, a
Delaware limited liability company,
Plaintiff - Appellant,
v.
CENTEX HOMES, A Nevada general
partnership,
Defendant - Appellee.
No. 10-17548
D.C. No. 1:09-cv-00272-DAE-
LEK
MEMORANDUM*
KO OLINA DEVELOPMENT, LLC, a
Delaware limited liability company,
Plaintiff - Appellee,
v.
CENTEX HOMES, A Nevada general
partnership,
Defendant - Appellant.
No. 11-15246
D.C. No. 1:09-cv-00272-DAE-LK
Appeal from the United States District Court
for the District of Hawaii
FILED
NOV 06 2012
MOLLY C. DWYER, CLERK
U .S. C OU R T OF APPE ALS

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David A. Ezra, District Judge, Presiding
Argued and Submitted October 17, 2012
Honolulu, Hawaii
Before: REINHARDT, THOMAS, and PAEZ, Circuit Judges.
We consider here the cross-appeals by Ko Olina Development, LLC (KOD)
and Centex Homes. KOD appeals from the district court’s judgment. Centex
appeals from the district court’s denial of its motion for reconsideration of an order
enforcing the judgment. We have jurisdiction under 28 U.S.C. § 1291, and affirm.
I. KOD’s Appeal
We review de novo the interpretation and meaning of contract provisions.
Milenbach v. C.I.R., 318 F.3d 924, 930 (9th Cir. 2003). Under Hawai’i law, which
applies here, the terms of a contract are interpreted according to their plain,
ordinary and accepted use in common speech, unless the contract indicates a
different meaning. Amfac, Inc. v. Waikiki Beachcomber Inv. Co., 839 P.2d 10, 24
(Haw. 1992). We look no further than the four corners of the document to
determine whether an ambiguity exists, and the parties' disagreement as to the
meaning of a contract or its terms does not render clear language ambiguous.
Stanford Carr Dev. Corp. v. Unity House, Inc., 141 P.3d 459, 471 (Haw. 2006). An
“ambiguity is found to exist . . . only when the contract taken as a whole, is

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reasonably subject to differing interpretation.” Sturla, Inc. v. Fireman's Fund Ins.
Co., 684 P.2d 960, 964 (Haw. 1984).
The terms of KOD’s option contract to purchase the Commercial
Apartments, consisting of the Right of First Refusal (ROFR) and its First and
Second Amendments, are dispositive. The district court determined that the
Limited Common Elements of the condominium development were akin to
licenses, rather than easements. Under this rubric, the district court concluded that
Centex could “recharacterize” certain Limited Common Elements as Common
Elements because they were not fixed property interests that ran with the transfer
of the dominant estate. We do not find it necessary to determine the common law
property nature of the Limited Common Elements, and resolve this issue solely
under relevant Hawai’i contract law and the governing condominium documents.
We agree with the district court that the express terms of the documents that
create the option contract for the purchase of the Commercial Apartments are
unambiguous. Because the option as created by the ROFR and its Amendments
does not include in its terms any reference to the Limited Common Elements or
any appurtenant interests to the Apartments, the express terms of the option
contract do not limit Centex’s reserved right to recharacterize the Limited
Common Elements. Even if the option did encompass appurtenant interests to the

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Apartments, those interests would be assessed by reference to the Condominium
Declaration, and thus the entire Condominium Declaration must also be
considered. Article XXIII of the Condominium Declaration reserves Centex's right
to recharacterize the Limited Common Elements as long as Centex owns the
Commercial Apartments, which it did at the time of recharacterization. By its
express terms, the option does not supersede this prior reserved right.
KOD argues that its option includes the right to purchase the Apartments as
they existed on the day the option was created, with the Limited Common
Elements appurtenant. An option contract, however, is distinct from a real estate
sale contract or a conveyance. See Yee Hop v. Nakuina, 27 Haw. 286, 289 (1923).
We must evaluate the option contract only on its own terms.
Because the terms of the option contract are unambiguous, we affirm the
district court’s finding that Centex did not violate KOD’s option when it exercised
its reserved right to recharacterize Limited Common Elements appurtenant to
apartments Centex owned.
II. Centex’s Appeal
To resolve a subsequent dispute arising from the exercise of the option, the
district court granted KOD’s motion to enforce the Findings of Fact, Conclusions
of Law and Judgment. On January 21, 2011, the district court denied Centex’s

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Motion for Reconsideration. Preliminarily, we conclude that because the January
21, 2011 enforcement order did not expand the scope of the judgment, the district
court did not exceed its jurisdiction when it granted KOD’s motion. We further
conclude, for the reasons stated by the district court, that the terms of the option as
reflected in the ROFR and Amendments did not authorize Centex to impose
restrictive conditions on the sale of the Commercial Apartments to KOD under the
option. We therefore affirm.
AFFIRMED.

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