HB981 • 2026

RELATING TO ATTORNEYS' FEES.

Active

The official status still shows this bill as active or still awaiting another formal step.

Sponsor: MATAYOSHI, CHUN, POEPOE, TARNAS
Last action: 2025-12-08
Official status: Carried over to 2026 Regular Session.
Effective date: Not listed

Plain English Breakdown

The bill summary does not provide specific details on enforcement mechanisms or penalties for non-compliance.

Rules for Attorneys' Fees in Construction Defect Cases

This bill sets limits on the amount of attorneys' fees that can be charged when dealing with construction defects, ensuring plaintiffs receive at least ninety percent of their repair costs after fees are deducted.

What This Bill Does

Limits attorney's fees to twenty-five percent of the recovery amount in cases related to construction defects.
Ensures a plaintiff receives an amount that is at least ninety percent of the repair cost for the construction defect, after attorney's fees and costs are deducted.

Who It Names or Affects

People involved in legal disputes over construction defects
Attorneys representing parties in such disputes

Terms To Know

construction defect: A deficiency in, or arising out of, the design, specifications, surveying, planning, construction, supervision, or observation of construction of a building or structure.

Limits and Unknowns

The bill does not affect contracts that existed before its effective date.
It is unclear how this law will be enforced and what penalties might apply for non-compliance.

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

HD1

Hawaii published version HD1

Plain English: This amendment limits the attorney's fees that can be charged in construction defect cases to a maximum of twenty-five percent of the recovery amount.

Adds new sections to Hawaii Revised Statutes Chapter 605 and 607, limiting attorneys' fees for plaintiffs in construction defect disputes or actions to no more than 25% of the recovery amount.

The amendment text specifies a future effective date (July 1, 3000) which is likely an error and not intended as a real implementation date.
It does not provide details on how to handle contracts existing before this Act's effective date.

Bill History

2025-12-08 D
Carried over to 2026 Regular Session.
2025-02-19 H
The committee(s) on JHA recommend(s) that the measure be deferred.
2025-02-14 H
Bill scheduled to be heard by JHA on Wednesday, 02-19-25 2:00PM in House conference room 325 VIA VIDEOCONFERENCE.
2025-02-11 H
Passed Second Reading as amended in HD 1 and referred to the committee(s) on JHA with none voting aye with reservations; none voting no (0) and Representative(s) Cochran, Ward excused (2).
2025-02-11 H
Reported from CPC (Stand. Com. Rep. No. 429) as amended in HD 1, recommending passage on Second Reading and referral to JHA.
2025-02-05 H
The committee on CPC recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 10 Ayes: Representative(s) Matayoshi, Chun, Ilagan, Ichiyama, Iwamoto, Kong, Lowen, Marten, Tam, Pierick; Ayes with reservations: none; 0 Noes: none; and 0 Excused: none.
2025-02-03 H
Bill scheduled to be heard by CPC on Wednesday, 02-05-25 2:00PM in House conference room 329 VIA VIDEOCONFERENCE.
2025-01-23 H
Referred to CPC, JHA, referral sheet 3
2025-01-23 H
Introduced and Pass First Reading.
2025-01-21 H
Pending introduction.

Official Summary Text

RELATING TO ATTORNEYS' FEES.
Settlements; Civil Actions; Attorney's Fees and Costs; Construction Defects
Limits the accrued attorneys' fees and costs in matters relating to, or actions brought as a result of, construction defects to twenty-five per cent of the recovery amount. Effective 7/1/3000. (HD1)

Current Bill Text

Read the full stored bill text

HB981

HOUSE OF REPRESENTATIVES

H.B. NO.

981

THIRTY-THIRD LEGISLATURE, 2025

STATE OF HAWAII

A BILL FOR AN ACT

RELATING
TO ATTORNEYS' FEES
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

����
SECTION 1.
�
The legislature finds that attorney's fees
can cost a prevailing party a significant portion of their settlement amount or
monetary award.
�
In some cases, a
prevailing party may only receive sixty to sixty-five per cent of the
settlement amount or monetary award after attorney's fees and costs are
deducted.
�
For a plaintiff that is suing
for construction defects, a significant reduction in the settlement amount or
monetary award may not leave the plaintiff with enough money to cover the necessary
repair costs.
�
In that situation, the
plaintiff may end up in a worse position than before they initiated the lawsuit
and publicly disclosed the existence of the construction defects.
�
A property with known construction defects
may become significantly devalued which will impact the plaintiff's ability to
sell or refinance the property.

����
The purpose of this Act is to limit the
attorneys' fees in settlement agreements relating to, or actions brought as a
result of, construction defects to ensure that plaintiffs can better afford the
repair costs.

����
SECTION 2.
�
Chapter 605, Hawaii Revised Statutes, is
amended by adding a new section to be appropriately designated and to read as
follows:

����
"
�605-
�
Attorney's
fees in settlements relating to construction defects; limitation.
�
(a)
�
Notwithstanding any other law to the
contrary, practitioners shall limit the amount of attorney's fees in any
settlement agreement arising from a dispute relating to construction defects to
ensure that the plaintiff receives an amount that is at least ninety per cent
of the repair cost for the construction defect, after attorney's fees and
costs, if any, are deducted.

����
(b)
�

For the purposes of this section, "construction defect" means
a deficiency in, or arising out of, the design, specifications, surveying,
planning, construction, supervision, or observation of construction of a
building or structure.
"

����
SECTION 3.
�
Chapter 607, Hawaii Revised Statutes, is
amended by adding a new section to be appropriately designated and to read as
follows:

����
"
�607-
�
Attorney's
fees in actions brought as a result of construction defects; limitation.
�
(a)
�
Notwithstanding any other law to the
contrary, a court shall limit the amount of attorney's fees allowed or awarded
in actions brought as a result of construction defects to ensure that the
prevailing plaintiff receives monetary damages in an amount that is at least
ninety per cent of the repair cost for the construction defect, after
attorney's fees and costs, if any, are deducted.

����
(b)
�

For the purposes of this section, "construction defect" has
the same meaning as in section 605- .
"

����
SECTION 4.
�
This Act shall not be applied so as to impair
any contract existing as of the effective date of this Act in a manner
violative of either the Constitution of the State of Hawaii or Article I,
section 10, of the United States Constitution.

����
SECTION 5.
�
This Act does not affect rights and duties
that matured, penalties that were incurred, and proceedings that were begun
before its effective date.

����
SECTION 6.
�
New statutory material is underscored.

����
SECTION 7.
�
This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________

Report Title:

Settlements;
Civil Actions; Attorneys' Fees; Construction Defects

Description:

Limits
the attorneys' fees in settlement agreements relating to, or actions brought as
a result of, construction defects to ensure that plaintiffs receive an amount
that is at least ninety per cent of the repair cost for the construction defect.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.